Bellingham considers this new tax to fund homeless programs
Bellingham would collect a new sales tax to ease the homeless crisis by building low-income housing and funding mental health services, under a measure being drafted for consideration in March.
City Councilman Dan Hammill proposed the measure, which would add one-tenth of 1% to Bellingham’s sales tax.
That’s a penny in tax on a $10 purchase.
“What we would be doing is creating another Bellingham Home Fund for affordable housing,” Hammill told The Bellingham Herald in an interview Monday, Feb. 22.
“Voters see the value in this,” Hammill said at a City Council committee session where he introduced the measure.
“They see the solution to homelessness is building housing and providing services for those that need it,” he said.
Such a tax could bring in $3 million a year, Deputy Finance Director Forrest Longman told The Herald in an email.
Current sales tax rate in Bellingham is 8.7%, the same as in Ferndale, Lynden and Mount Vernon, according to the state Department of Revenue.
Seattle’s sales tax rate is 10.1%.
Cities can enact a sales tax for low-income housing under a law that passed the Democratic-controlled Legislature along partisan lines and was signed by Gov. Jay Inslee in 2020.
Hammill’s proposed tax would supplement the Bellingham Home Fund, which is a property tax that collects 36 cents for every $1,000 of assessed value and directs it toward low-income housing.
It raises about $4 million annually, the city said in 2018 when the measure passed with 67% of the vote.
It costs the owner of a $500,000 home $180 a year.
“If we don’t address the fundamental systemic problems squarely, we’ll just keep treating the symptoms,” Hammill told The Herald.
Hammill’s proposal came at the end of a City Council committee session on Monday in which city officials discussed efforts to find housing for the city’s poorest residents — especially those who are homeless and living in motels, temporary shelters or in tents.
“This is not my preferred method. I would prefer the federal government do their job in providing us with funds that we need to address this national issue,” Hammill said during the meeting.
“These are the tools we are left with to address huge failed policy at the federal level. This is the option that we have,” he said.
Council members voted unanimously to have an ordinance authorizing the tax measure ready for consideration at its March 8 meeting.
Under an expedited timeline, it could take effect by March 22, Hammill said.
