Island County combines REET funds in code change; online commenter urged affordable-housing use

Island County commissioners unanimously adopted Ordinance C59-25 on Dec. 1 to amend county code governing real-estate excise tax (REET) funds, combining REIT 1 and REIT 2 into a single fund and removing the requirement to keep them separate.

Susan Geiger, director of budget and risk management, told the board recent state legislation allows expanded use of REIT 2 funds to mirror REIT 1. Geiger said the draft ordinance combines the funds into one fund and incorporates identical allowable uses "with the exception of affordable housing," which the board had previously directed to exclude from the code update.

An online commenter identified as Michael Clyburn urged the board to include affordable housing in the expanded allowable uses, calling it "the wrong move" not to do so given a housing crisis on Whidbey Island.

In deliberations, one commissioner said including affordable housing in the REET fund could dilute funding for traditional capital needs such as parks and county facilities, which historically used REET 2 funding. Another commissioner noted the county has two other dedicated affordable-housing funds with healthy balances and that zoning and land availability—not strictly funding—are barriers to new affordable housing.

After discussion the board moved and seconded the ordinance and adopted it unanimously. The code change simplifies reporting and accounting by allowing the county to track REET activities within a single fund while still coding individual activities to maintain transparency.

The ordinance was presented as Ordinance C59-25 (ICC 3.04A amendment). The board indicated that future boards could amend the code to add or expand allowable uses if priorities change.