Thursday, October 1, 2026
Thurston County has deferred a proposal from New Horizon Communities (NHC) to lease county-owned land on Carpenter Road SE for a 72-unit affordable housing project.
The proposal envisions a 50-year lease for 2.86 acres of public land at 720 Carpenter Road SE. The two-phase development would merge permanent supportive housing and income-restricted apartments.
Phase 1 calls for 32 permanent supportive housing units, with six complying with Americans with Disabilities Act standards.
Phase 2 calls for 40 affordable one-bedroom apartments for households earning 30% to 60% of area median income.
Budget concerns
County officials examined the proposal during the Thurston County Board of County Commissioners work session on Wednesday, Nov. 5, where County Manager Leonard Hernandez said staff could not address new housing commitments until fiscal obligations are settled.
“We’re in a different landscape right now,” Hernandez said. “Our staff recommendation is that we wait to see how this next fiscal year goes.”
Hernadez said the Thurston County Public Health and Social Services (PHSS) Department is still in talks with the state over possible cuts to housing programs.
The department is currently finalizing the county’s U.S. Department of Housing and Urban Development (HUD) agreement, which is expected to modify how local housing grants are utilized locally.
Thurston Regional Housing Council, he added, is reassessing how to distribute existing Washington State Department of Commerce allocations to ongoing projects.
Staff recommend delaying action until the county verifies how much funding would be available in 2026.
Commissioner Carolina Mejia asked whether NHC could proceed if the housing council doesn't award funding.
Hernandez mentioned discussions had occurred but confirmed there was no alternative funding.
“They’re aware that other state funding is also strained, so we were pretty open in our communication ... that some of those funding sources on the county side are also strained,” he said.
“But they did their due diligence in putting together what they would need in order to make this work. Some of those funding components are not available as they were maybe a year ago.”
He urged the board to postpone the plan and revisit it when funding conditions improve.
“We thank New Horizons for the proposal and keep this ready on the shelf. … But at this point, we let them know that, due to some financial constraints, we don’t see this being something we can work on in 2026,” he said.
The board agreed to table the proposal without a formal vote.
Proposed partnership
New Horizon Communities, formerly Quixote Communities, provides permanent supportive housing in Thurston, Mason and Pierce Counties.
New Horizon operates under the “Housing First Service” model, meaning residents are not screened out for prior evictions, low income or criminal background.
In its written proposal in August, New Horizon outlined five partnership terms for proceeding with the project on county land:
Lease agreement - Enter a 50-year lease for $1 per year with an option to extend for another 20 years. The lease would be limitied to the Phase 1 footprint if Phase 2 does not advance within eight years.
Predevelopment support - Disburse $150,000 in predevelopment funding for consulting, design and due diligence reports, such as environmental, geotechnical and surveys as necessary for any use of the property.
Budget endorsement - Back state and federal capital requests for both phases of development.
Infrastructure support - Collaborate on pedestrian infrastructure and community amenities to enhance the area for multifamily housing.
Parking - Explore parking reductions to accommodate additional housing units on the site.
The proposed Carpenter Road plan projected average development costs of $7.3 million for the permanent supportive housing component and $13.7 million for the affordable apartment phase.
Phase 1 would allocate $5.9 million for construction, $1.1 million for soft costs, and $275,000 for reserves and miscellaneous expenses.
Proposed budget sources include $4 million from the Washington State Housing Trust Fund, $450,000 from the Connecting Housing to Infrastructure Program, $1.5 million from the Federal Home Loan Bank, $1 million from Thurston County Housing Funding, $150,000 in Thurston County Predevelopment Funding and $175,000 from private fundraising.
Meanwhile, Phase 2 would budget $11.2 million for construction, $2 million for soft costs, and $510,000 for financing, reserves, and miscellaneous expenses.
11 comments on this item Please log in to comment by clicking here
TheVirtualOne
“New Horizon operates under the “Housing First Service” model, meaning residents are not screened out for prior evictions, low income or criminal background. ”
Great way to build a safe neighborhood.
Monday, November 10, 2025 Report this
JulesJames
Unsafe housing is not "affordable." Safety first. Not housing first. Renting housing to any broke person without regard to criminal and financial history is not a sustainable business model. Its a place for predator, prey and prayers by most anyone lucid enough to choose to move out ASAP.
Monday, November 10, 2025 Report this
OlyBlues
The county is BROKE and millions in debt. This is NOT the time to basically give away public property. This pet project is a horrible idea. None of these uneducated commissioners will be around in 50 years when their predecessors have to deal with another financial mess they have created. The homes built will not be moved in 50 years and no commission is going to evict them. The county must be strategic with any asset they have right now, not pandering to special interests, the homeless industrial complex, or foaming at the mouth over state Commerce grants which they seem to do frequently. They should be laser focused on revenue and survival, not freebie giveaways to score political points.
Tuesday, November 11, 2025 Report this
ejpoleii
I'm pretty sure the address is 720 Carpenter Rd. NE, not SE. The SE site is totally different. The NE site is next to the Olympia police training center and gun range.
As a Thurston citizen, it is clear to me that this proposal is merely another trick to aggrandize the "home first" NGO business. Homes first has been a clear failure. Everyone knows it. Anyone touting it is a fraud.
Tuesday, November 11, 2025 Report this
HappyOlympian
No screening for tenants, what a horrible idea.
Tuesday, November 11, 2025 Report this
DenselikeOlympia
The hell is going on with the County Manager? He's totally hijacking the budget process, which is not his duty under 36.40. He literally locked the auditor out of the financial data softeware and THE AUDITOR'S OFFICE HASN'T BEEN ABLE TO CONFIRM BUDGET ACCURACY, which means his office is an obstruction of the Auditor's statutory responsibility to ensure accurate data is presented to the BOCC. He's clearly violating state law, but he put an unqualified fall guy into the Budget Manager position to shield himself.
So look, everyone, affordable housing is contentious and expensive and all, but WE NEED A COMPETENT & HONEST COUNTY MANAGER TO BE HAVING THIS DISCUSSION AT ALL.
Tuesday, November 11, 2025 Report this
DenselikeOlympia
The actual budget deficit is between $14-16 million, LESS THAN HALF than what the County Manager's office has reported (a report, btw, that has always been prepared by the Auditor's office, as required by state law). Despite knowledge of this discrepancy for weeks, local news publications like the Olympian are still reporting the outdated, incorrect sums. BIG. RED. FLAG. Our local government is breaking budgetary laws and presenting information known to be false to us.
We sure do need some investigative journalists in Olympia. e "according to the public official who bogarted the microphone" is a sure-fire way to publish untruths.
Tuesday, November 11, 2025 Report this
HappyOlympian
Thanks DenselikeOlympia, great info. Please add more insights on jolt forums!
Tuesday, November 11, 2025 Report this
DStusser
Responding to DenselikeOlympia, who included in his comment, "We sure do need some investigative journalists in Olympia."
Yes, sir. We sure do. The best way to ensure that this happens is to contribute to The JOLT -- and the best time to do it is now, during our Annual Campaign, while your dollar is matched more than 1:1 by NewsMatch and GiveLocal.
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Tuesday, November 11, 2025 Report this
LindaD
*** offenders, arsonists, and the mentally ill are going to live somewhere. Better they be in a place where someone can keep an eye on them and help where possible rather than in a sleeping bag on the sidewalk.
Wednesday, November 12, 2025 Report this
DenselikeOlympia
Donated. LMK if there's a monthly donation option. Thanks for your work!
Sunday, November 16, 2025 Report this