Thurston Regional Housing Council facing a number of funding challenges

The Thurston Regional Housing Council is facing a critical year with limited resources, as it approved the allocation of millions of dollars in funding for affordable housing and homeless services through its 2025 request for proposal (RFP) process.

At an RHC meeting on Dec. 11, Tom Webster, Housing and Homeless Prevention Manager, presented the anticipated funding for affordable housing capital projects and homeless services. He emphasized that the figures are still subject to legislative decisions and finalized state allocations.  

Estimated Affordable Housing Revenues for 2025.

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Affordable housing revenue 

• Home Investment Partnership Program. This is an entitlement the region receives yearly from the Department of Housing and Urban Development (HUD). The council is projecting a decrease to around $700,000 for the upcoming year. Last year's funding was $781,573.  

• HOME American Rescue Plan Program (ARP). In 2024, the council received a $1.4 million, one-time allocation from the HOME ARP. However, in the coming year, that additional source will not be available, reducing overall revenues.  

• The 5386 funding refers to a portion of the local document recording fees set aside for affordable housing projects. Last year, the council allocated $225,000 from this source. However, due to a slight decline in document recording fees, the council is projecting this revenue at $200,000 for the upcoming year.  

• The 1406 funding refers to the local sales tax retention. The council projected this revenue source to remain the same at $1.2 million in 2025.  

• Local Home Fund from Olympia. Webster said Olympia has projected a decrease of $2.06 million for next year.  

• For the county's portion of the Local Home Fund, the council is projecting $5 million in collections. Of that, 60% or $3 million can be used for capital projects, while 30% will be allocated to homeless services and 10% for administration.  

In total, the council has $7.16 million available for affordable housing capital projects. From this, the Affordable Housing Advisory Board has set aside 20%, or approximately $1.4 million for an opportunity fund to quickly address any acquisition needs that may arise.  

This leaves around $5.7 million to be distributed through the affordable housing RFP process.  

Homeless Services Revenues for 2025.

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Homeless services revenue: 

• Consolidated Homeless Grants (CHG). According to Webster, the Housing Council received $7,043,181 through the CHG contract with the state last year. However, the Department of Commerce has notified the council to anticipate a 20% reduction in the CHG funding for the upcoming year. This would result in approximately $5.6 million in available funding, though the amount will depend on the state's final budget decisions.  

• Housing and Essential Needs (HEN). The council is projecting the funding to be similar in 2024 at approximately $4 million. Webster said they are not anticipating a reduction in HEN program funding.  

• The 5386 funding. Last year, the council projected to allocate $1.5 million from this source, but the actual collections were slightly under that amount. For the upcoming year, the council is projecting around $1.3 million in funding, a slight decrease. Webster noted this projection could be adjusted upward if collection trends improve in the coming months.  

• Local Home Fund, which allocates 30% of the projected $5 million in collections to the council, is reflected in the $1.5 million.  

• Eviction Prevention Rent Assistance (EPRA) funding, which is part of the consolidated homeless grant contract, is projected to see a 20% decrease, resulting in $1 million available. Webster mentioned that the council has less flexibility in how these specific rent assistance funds can be used.  

• The Human Services Fund, which is the local sales tax revenue, has been projected at around $350,000 based on the prior year's flat collections. Webster added that the council will be reaching out to the jurisdictions in January to get updated sales tax numbers, which may result in an adjustment to this projection. 

In total, the council is projecting $13.75 million in available funding in 2025, compared with $15.89 million in 2024, reflecting a decrease in resources.  

Recommended Homeless Services set-asides.

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Homeless services set-asides 

For the set-asides, the council is maintaining consistent allocations from previous years and a slight increase in other programs, including: 

• Cold and hazardous weather - $275,000 

• Point in Time Count - $30,000 

• Emergency Funds - $200,000 

• Coordinated Entry - $350,000 

• Housing Basic Needs - $250,000  

• Lived Experience Housing Steering Committee (LEHSC) - $50,000 

• Advisory Board stipends - $25,000 

• DEI training for agencies - $30,000 

Carolina Mejia, of the Thurston Board of County Commissioners (BOCC), inquired about the timeline for receiving the final funding amounts from the state.

Webster explained that the council typically receives good estimates on the state funding once the state budget is finalized. However, it can take an additional 30 days or so before the council gets the final allocation numbers, which he anticipated may not be until May or early June. 

Webster stated that if the actual funding is not too far off from the current estimates, the council will make percentage-based adjustments to the awards.

However, if the funding is substantially less or more than projected, the council will need to reconvene to discuss revising funding decisions, potentially considering new projects if additional money is available, or making difficult choices if the funding is much lower than expected.