Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Housing Finance topic
No spam. Unsubscribe anytime.
Commission explores CHIP, MFTE and grants to reduce buyer price
Summary
The commission reviewed funding options to lower effective buyer costs for the proposed units, including CHIP infrastructure grants (about $20,000 toward hookups), down-payment assistance and MFTE; members were told CHIP requires long-term affordability covenants under RCW rules.
David Smith and others walked through the financing levers that could move a $329,000 sale price closer to an affordable effective buyer price. Smith described use of a CHIP infrastructure grant to subsidize sewer and water hook-ups and noted other possibilities such as down-payment assistance and Department of Commerce grants that his team has used on prior projects.
"The loan amount that the affordable buyer, which would be his his effective price, is $239,000," Smith said when summarizing his pro forma assumptions and the effect of layered subsidies. He also flagged the multifamily tax exemption (MFTE) as an effective $20,000 reduction in mortgage cost but acknowledged MFTE shifts cost to other taxpayers — a point that generated discussion about equity and council appetite.
Staff and commission members asked for a clearer list of conditional requirements — for example, Smith said the CHIP grant carries an RCW requirement for a long affordability covenant (discussed as a 50-year obligation). The commission asked staff to outline grant timelines, the exact covenants required by each funding source and how those requirements would affect resale and buyer equity.
