Governor Jay Inslee’s Jan. 14 State of the State speech focused primarily on a low carbon fuel standard (LCFS) proposal that in past session has failed to clear the legislature and funding homelessness prevention programs.. Some building advocates say an LCFS would only make housing less affordable, which the state Department of Commerce cites as a driver of homelessness.
Under Inslee’s proposed operating budget, 2,100 more shelter beds would be created throughout the state. Housing assistance would also be provided to 3,000 homeless individuals – 30 percent of the total 10,000 homeless people in Washington.
“Homelessness is a statewide problem and it needs a statewide response,” he said. “Responding to homelessness can’t mean moving people down the road, to someone else’s city or to the next bridge. It’s about prevention, it’s about rent assistance and it’s about supportive housing for our most vulnerable individuals.”
At the same time, the state would provide local governments a grant program to fund homelessness programs.
“I will gauge our success not on where the money comes from, but how many people we can move to safe housing,” Inslee said. “My plan will require financial participation from cities and counties but gives them flexibility to create local solutions to boost shelter capacity.”
In a response, Senate Minority Leader Mark Schoesler (R-9) said: “If you look at our approach to homelessness…we all agree it’s a problem. We just have different ways of getting there. Are we really spending it (money) well?”
Despite strong majorities in both chambers, Inslee’s 2020 supplemental operating budget contained no new revenue sources, including a capital gains income tax found in prior budget proposals. However, the budget does call for taking $300 million from the state’s budget stabilization account, also known as the “rainy day fund,” to pay for homelessness programs.
House Minority Leader JT Wilcox (R-2) told Lens recently that using rainy day fund money “in the end just builds the bow wave, and the bow wave creates deficit(s) used to justify new taxes. We all need to be very vigilant that things that seem innocuous now don’t create a bow wave.”
Inslee also touted the LCFS proposal via SB 5412 intended to reduce greenhouse gas emissions in the state’s transportation sector. LCFS programs generate credits for entities that provide fuel below the standard and deficits for entities that provide fuel above it. If a deficit occurs, entities must purchase credits from clean fuel providers.
“We need to tackle this challenge with the same gusto and belief in inevitable success that have powered our previous triumphs,” Inslee said.
Both Oregon and California have LCFS programs in various stages of implementation. The Puget Sound Clean Air agency (PSCAA) is considering a regional program that would apply to four counties. Aside from the issues of effectiveness with LCFS programs, one objection raised by critics is the cost. According to one estimate, if implemented the PSCAA proposal could cost affected households $900 annually and raise gas prices by $.57 per gallon.
Building Industry Association of Washington Government Affairs Director Jan Himebaugh told Lens recently that an LCFS would also inevitably raise the price of houses. “Residential construction workers aren’t on one job site every day. We have multiple projects across town. It adds a significant amount of money to get to a job to build it, let alone the costs to bring materials to a job site. Material delivery is going to be more expensive.”
She added that it “reduces customer buying power” because they’re “spending more money on gas. That means that they’re going to have less money in their pocket to purchase a home.”