Bill would let King County use short‑term lodging tax revenue for community‑led equitable development

The Senate Local Government, Land Use & Tribal Affairs Committee heard testimony on Senate Bill 5138, a measure to let counties use short‑term lodging tax revenue for community‑initiated equitable development in the same way the City of Seattle currently does.

Committee staff Rohan Bhattacharjee told the panel the bill applies to public facilities districts — municipal corporations that may levy taxes or fees to fund regional centers — and would require that the county use its portion of revenue from a short‑term lodging tax for both affordable housing and community‑driven equitable development rather than only affordable housing.

Supporters said the change aims to give community organizations the flexibility to pair housing with cultural spaces, childcare and agricultural uses. Eliana Horne, a policy analyst with Puget Soundstage and lead on the King County Equitable Development Initiative Coalition, said SB 5138 would let communities use short‑term lodging revenue “to actually get to lead development in their communities and lead the way out of the displacement crisis that BIPOC communities are experiencing.”

Friendly Vang Johnson of the PNW BIPOC Farmland Trust described the bill’s potential to preserve farmland and keep small, culturally rooted farming operations viable. Aaron Garcia, executive director of the White Center Community Development Association, said projects in unincorporated communities need flexible funding because “this limitation stands in contrast to Seattle, where the revenue has been a cornerstone of their EDI project.”

Howard Greenwich, research director at Puget Soundstage, told the committee the county has already pledged “over $5,000,000 in short term lodging tax for an equitable development program this year” and that the bill simply aligns county authority with how Seattle uses similar revenue. He said the proposal “will ensure the program is even more successful” and emphasized that the funds would be directed by county staff through an EDI program.

Senators asked how the bill differs from prior lodging‑tax uses and whether the change is limited to King County. Sponsor Senator Lisa Saldanha said the change is intended primarily for King County as written now and that it clarifies that county funds may be used for community‑initiated projects — not to replace affordable housing funding but to allow nonhousing community elements to be funded alongside housing.

Public testimony included multiple community leaders and affordable‑housing advocates from south King County and White Center who said the flexibility would help fund cultural centers, childcare, small business incubation and agricultural preservation alongside housing. No fiscal objections were raised at the hearing; staff said a fiscal note is available.

The hearing record closed after multiple supporters testified remotely and in person. The committee did not take a vote on the bill at this hearing.