Council declines to send letter asking county to use HB 1406 funds for feasibility study of supportive housing

The Shelton City Council considered a draft letter on June 17 asking the Mason County commissioners to use House Bill 1406 funds for a feasibility study of converting the former community-lifeline building at 218 North Third Street into permanent supportive housing by New Horizons Communities.

City Manager Mark Ziegler summarized the request and recounted prior discussions with county officials. Ziegler said the city and county had executed an interlocal agreement in 2019 that outlined cooperative affordable-housing efforts and that HB 1406 (legislation passed in 2018) allows a pass-through of certain state sales-tax credits for affordable housing. Ziegler said the county had an estimated balance — which he described during the meeting as roughly $500,000 remaining in the county’s coffers from those funds — and that about $55,000 had been spent previously on a Mason County housing-needs analysis.

Council members debated whether the requested funds should be used for a site-specific feasibility study for 218 North Third Street or for a broader study of potential housing sites. Concerns raised in public comment and by council members included parking and traffic impacts, whether infrastructure improvements (including sprinklers) tied to the building’s sale raised questions about fund accounting, and whether the site was the best location for supportive housing. One council member said they were not in favor of the request as presented; another said the feasibility study would produce answers to parking and land‑use questions. A council member also noted the city’s annual share from the HB 1406 pass-through was comparatively small — roughly $18,000 per year — and that much of the larger balance was held by the county.

A motion to approve the letter and authorize the mayor to sign was moved and seconded. The council took a voice vote; the meeting record shows one or more “nay” responses after the call for ayes and the chair stated the motion failed.

The council did not direct staff to prepare an alternative funding plan or broader site-selection study; members asked staff to continue discussions with the county and some indicated they wanted more information before committing funds.