1. Washington State’s Low Income Housing Valuation Workgroup 2007 We are here for many reasons: Long standing issue. 2007 Legislation. There are currently many appeals waiting to be heard. Affordable housing assessment practices is a national issue.

2. Washington State’s Low Income Housing Valuation Workgroup 2007 Ground Rules These properties are not “exempt”, therefore the question is; ‘What is the most appropriate way to estimate their fair market value?’ What data can be considered “reliable” for use in determining FMV? What data should not be considered reliable in determining FMV? What misconceptions are there that need to be discussed? Why do owners think assessors are “overvaluing” these properties? Why do assessors think they have valued these properties “at market”? What terms need to be defined?

3. Washington State’s Low Income Housing Valuation Workgroup 2007 Groundrules How do property assessments on “affordable housing” affect tenants. Do some of the property’s operational expenses get subsidized by the government program they are enrolled in, such as property taxes, or marketing expenses. Who do “affordable housing” projects serve? Is there a mixed tenant makeup? Do all tenants have to meet a certain percentage of AMI? Why would a developer develop one of these?

4. Affordable Housing Defining the Problem Affordable housing becoming more common –Local government agency affordability programs –Community Land Trusts –State-mandated affordable housing plans The Problem: –Rapidly rising home values –Limited equity appreciation in affordable units –Property taxed on unrealized market value

5. Affordable Housing – Defining the Problem Determine impact of restrictions on market value for assessment purposes? What’s wrong with using Market sales? Rights of first refusal upon resale. Ownership of land vs. ownership of improvement Recognize effect of restrictions on FMV Develop a “restricted market value” for assessment purposes? Or should market value already consider restrictions?

6. Call to Action: Next Steps Develop a “best practice” for assessing affordable housing Affordable housing landscape has changed Elevate the dialogue among assessors and stakeholders

7. Washington State’s Low Income Housing Valuation Workgroup 2007 Various Programs: Section 42 (Tax Credits) Section 8 (Project based) Section 221(d)(3) (BMIR’s) Section 515 – USDA Rural Section 521 – (Rental assistance) Section 202 – (Senior)

8. Affordable Housing Programs AMI ThresholdDefinitionAffordable Housing Program 30% of AMI Extremely Low Income Public housing Section 8 Housing Choice Voucher 50% of AMI Very Low Income LIHTC/Section 42 Rentals Senior Housing, Sec. 202 80% of AMI Low Income HOME or first time buyer assistance Workforce or employer-assisted housing Community Land Trusts 100%-120% of AMI Moderate & Middle Income First time buyer, with or without down payment assistance

9. OccupationMedian Annual Wages Affordable** Purchase Price Affordability Gap Waiters and Waitresses $12,324 $33,965$357,135 Cashiers $15,480 $47,143$343,957 Retail salespersons $18,936 $61,578$329,522 Cooks (all types) $20,016 $65,658$325,442 Construction laborers $21,060 $70,440$320,660 Truck drivers (all types) $26,232 $92,023$299,077 Customer Service Reps $24,264 $83,812$307,288 Secretaries & Admin Assistants (all types except legal & medical) $24,252$83,763$307,337 Elementary School Teacher $39,876 $148,983$242,117 Secondary School Teacher $44,556 $168,516$222,584 Fire fighters $47,172 $179,440$211,660 Police officers $49,188 $187,857$203,243

10. Occupation<50% AMI<80% AMI<120% AMI<150% AMI $25,673$41,077$61,615$77,019 Waiters and Waitresses X Cashiers X Retail salespersons X Cooks (all types) X Construction laborers X Truck drivers (all types) X Customer Service Reps X Secretaries & Admin Assistants (all types except legal & medical) X Elementary School Teacher X Secondary School Teacher X Fire fighters X Police officers X