Thurston County commissioners on Jan. 7 directed staff to prepare contingency scenarios and to postpone action on a major request-for-proposals cycle for housing and homeless services after staff reported uncertainty about state right-of-way funding.

The county's Office of Housing and Homeless Prevention had planned to issue four consolidated RFPs in mid-January for affordable housing capital projects, homeless services, community development block grant (CDBG) awards and the Veterans Emergency Shelter Program. Tom Webster, director of the Office of Housing and Homeless Prevention, told commissioners the RFP schedule had been moved up this year so awards and contracts could be in place by July 1 and come to the board for approval in June.

Webster and county manager Leonard Hernandez said the county received notice at a shared legislative meeting that the right-of-way funding that has supported shelter and transition operations statewide may not appear in the governor's budget as expected. That funding had previously been funded at $75 million statewide. Staff said Department of Commerce officials told county representatives they were seeking $45 million in the governor's proposed budget, which would represent a reduction; the county's historical annual receipts totaled roughly $9 million across the county and city of Olympia. If the $45 million request is approved, Thurston County staff estimated the county's share would be about $5.5 million, leaving a potential $3.5 million shortfall compared with recent years.

Commissioners and staff said the message from the delegation and city leaders was emphatic that the state's budget may not include the prior right-of-way operational funding. Commissioners asked staff to assemble a work session with County Manager Hernandez, Dr. Jen Freiheit (director of Public Health and Social Services) and housing staff to map out scenarios: full funding at various reduced levels, partial funding, and the possibility of no right-of-way funding. The board asked for a clear accounting of current obligations and the county's operating commitments so it can assess options.

Because the RFP cycle has time pressure (Webster said the county typically sees 60 to 70 applications and wanted contracts ready by July 1), commissioners decided to pull the RFP item from the upcoming consent calendar and present the RFPs later after the work session. Commissioner Kelly Mejia and others said the pause should apply only to new funding requests or new projects pending the assessment, not to existing, ongoing contracts.

Commissioners asked staff to provide: a breakdown of current housing and shelter operational obligations; the mix of funding sources (state, federal CDBG, local); the potential service impacts if right-of-way funding is reduced or eliminated; and contingency options to cover critical operations. Staff agreed to return with a work-session presentation and scenario planning.

The commissioners agreed the county would also coordinate with the mayors and the Regional Housing Council so that cities and the county present a unified contingency plan should the state funding not materialize.