Washington Legislature Bills to Watch for REALTORS®

Legalize Housing in Urban and Rural Areas

Housing costs are at an all-time high, new housing inventory is at all-time low, and the
homeownership rate Washington State continues to decline. So why aren’t more houses
being built? Because in Washington State, more housing is unlawful thanks to local zoning
and Growth Board decisions. The solution is to make housing legal again.
REALTORS® will support legislation that appropriately modifies local zoning and development regulations that prohibit more housing from being built. Unlike other state
legislatures, Washington has yet to take aggressive action on market-rate housing.

The Legislature’s approach should reflect the differences in cities and neighborhoods based on size and proximity to transit and job centers.

Accessory Dwelling Units in Rural Areas – HB 1298/SB 5221Concerning regulation of accessory dwelling units located outside of urban growth areas. Both bills are considered dead this session. In rural areas, REALTORS® support BILLS that would allow detached accessory dwelling units (ADUs) outside urban growth areas (UGAs), subject to size limitations and other requirements. Detached ADUs are a cost-effective solution to housing supply and should not be allowed only in urban areas.

GMA/Density – HB 1157  Housing Supply Tax Incentives for Local Governments

Increasing housing supply through the growth management act and housing density tax incentives for local governments. This bill passed the House, but died in the Senate. These bills enable local governments to receive a portion of the State real estate excise tax (REET) for new housing units built within areas of increased density.

Support Consumer Protections in the Real Estate Agency Law

The use of “love letters” by buyers to describe themselves to the sellers has been discouraged by the real estate industry because information on race, marital status, gender, religion, or other personal information could create a violation of fair housing laws. These types of communications by a buyer would be prohibited, so that the buyer’s personal or family characteristics are not part the seller’s decision to accept a purchase offer.

In addition, in the recent Falcon v. Bowfits Court of Appeals case, the Court ruled that the statutory duties of a real estate broker under Chapter 18.86 RCW apply only to the broker’s own client, not to other brokers or parties to the transaction. This decision is contrary to the purpose and history of the agency law to establish clear statutory duties that protect consumers. For example, the Court’s decision would allow a broker to assert that the statutory duty “to deal honestly and in good faith” applies only to his or her own client, but not to the other broker or other parties in a transaction. This decision is harmful to consumers and must be corrected.

Housing, Land Use & Environmental

New for 2022 Session

Requiring Missing Middle Housing/Zoning for certain cities under the GMA – This bill will likely be based on HB 2780/SB 6536 from the 2020 Session, and introduced as a Gov. Inslee request bill sponsored by Rep. Bateman).

Carbon Emission Reduction in Commercial Buildings – There will likely be two bills, one increasing building energy efficiency for commercial/industrial buildings over 10,000 square feet (including residential multi-family), and a second limiting use or expansion of natural gas in certain buildings. SEPA Reform and Permit Streamlining – There will be a series of bills on SEPA streamlining, permit streamlining, and permit timelines.

Limited sales and use tax incentive program for redevelopment of vacant lands in urban areas  SB 5755 would stimulate the redevelopment of vacant or underdeveloped property in certain urban areas through a limited sales-and-use-tax deferral program. The tax deferral would help the owners of vacant or undeveloped properties build affordable housing. This program would enable cities to more fully realize their planning goals under the Growth Management Act and provide a benefit to the construction industry.

Concerning rent payments made by residential tenants SB 5749 would require that landlords accept non-electronic forms of rental payments in addition to electronic forms. This would lower barriers for seniors, Washingtonians with limited English proficiency, people with limited access to debit or credit cards, and families who struggle to access the internet. Requiring that landlords accept non-electronic forms of payment would alleviate a common challenge for many renters, better ensure that landlords receive rent payments on time, and reduce barriers as the state focuses on transitioning community members out of homelessness.

Holdovers from 2021 Session

HB 1157/SB5390 – REET Density Incentive Zones. Increasing housing supply through the growth management act and housing density tax incentives for local governments. In 2020, this bill passed the House, but died in the Senate.  (SUPPORT)

Accessory Dwelling Units in Rural AreasHB 1298/SB 5221 – Detached ADUs outside Urban Growth Areas (SUPPORT)

HB 1117Requiring Net Ecological Gain in Growth Management Act – Promoting salmon recovery through revisions to the state’s comprehensive planning framework. This bill died in committee (OPPOSE)

HB 1099Adding Climate Change Element to GMA.  Improving the state’s climate response through updates to the state’s comprehensive planning framework. A new version of this bill has been added, but died in the House. (OPPOSE)

HB 1337Accessory Dwelling Units in Urban Areas (SUPPORT)

HB 1241 Planning Planning for affordable housing under the growth management act. This bill died in committee last year. Modifying the GMA planning cycle and deadlines for GMA Comp Plans, and the role of federally-recognized tribes in GMA planning (OPPOSE)

HB 1232 Missing Middle. Adding Missing Middle housing/zoning requirements in the GMA (SUPPORT)

SB 5042Modifying vesting under the Growth Management Act. Concerning the effective date of certain actions taken under the growth management act. This bill had become somewhat controversial in 2020 and died in committee.(OPPOSE)

HB 1144Concerning standing before the growth management hearings board. Modifying standing requirements for appeals to the Growth Boards (SUPPORT)

Tax & Fiscal

Return from 2020

HB 2634 – REET incentive for affordable/non-profit housing (Note: this passed in 2020 but was part of the COVID veto group). (SUPPORT)

Consumer & Business

New for 2022

Uniform Partition of Heirs Property Act – This legislation would modify how “heirs property” (property in which the owner dies intestate and ownership is divided among multiple heirs) can be sold. The bill would end the practice of real estate investors acquiring a fractional interest in inherited property to force a below-market sale. Historically, this practice significantly impacted ownership of inherited farmland by racial minorities.

Landlord Tenant Regulations

New for 2022

Require registration for all for-profit rental housing – This legislation would require for profit landlords to register their units to accommodate point in time counts of available units for rent. The registry would likely be managed through the Department of Commerce.

Housing Justice Act – this legislation would prevent landlords from denying housing to tenants with criminal records.

Housing Court – This legislation would create a separate housing court system to relieve some of the pressure from the courts.

SB 5160 amendments – regarding amendments regarding county service requirements for the Eviction Resolution Program

Rent Control

Momentum on rent control seems to be waning since last sessions bill introductions due to the large infusions of cash for housing assistance, positive employment trends, recent changes to the LLTA, fear of exacerbating the current housing shortage, and overall COVID fatigue. Regardless of momentum, rent control is still on the docket for consideration by the legislature from the previous session;

SB 5139 – Rent Control (OPPOSE) The bill as introduced in the 2021 session prevents rent increases for 6 months after the end of the Governor’s emergency eviction ban and then limits rent increases to 3% for three months thereafter.

How to Testify

The good news for those interested in testifying on legislation is that both houses of the legislature now allow for Universal remote testimony – so people can testify on any bill from anywhere up to an hour prior to a committee meeting.