Law and Justice / Human Services Committee - Regular Meeting

Good afternoon. Welcome to the Snohomish County Health and Community Services Committee. Today is Tuesday, March 10. It's 11AM. We're meeting in the Jackson Boardroom and also remotely. Before we get into the agenda, I'm gonna read a brief public comment script. You'll be taking public comment beginning in person and then remotely. In Zoom, click the hand icon to raise your hand. If calling by phone, press 9 to raise hand. When called, upon press 6 to unmute. Each speaker will have three minutes to speak, and please start your comment with your name and your city of residence. And now we'll do roll call.

Committee Chair Mead? Here. Vice Chair Lo?

Present.

Committee Member Nearing?

Here.

Committee Member Dunn? Here. Committee Member Peterson? Chair, there are four members present.

Great. Thank you. So now we'll get into public comment. First, I'll open up public comment for anyone in person who'd like to provide comment. Seeing none, I'll verify we have no hands raised online.

No hands are raised.

Thank you. So we'll close public comment. We'll get into our action items. We have two of them today. First is motion 20 six-one 105.

For the record, Cynthia Foley, counsel staff. The health department is seeking to enter into an agreement with the Everett School District to allow school district facilities to be used for shelters and mass clinic services during an emergency or disaster. During an emergency, the county will keep the premises in good working condition and keep the site free from from the accumulation of waste or debris. Following the event, the county will pay to repair any damages that occurred to the site. Motion 26 dash one zero five authorizes the executive to sign the emergency use license agreement with the Everett School District. The request is to consider is to move motion 20 six-one 105 to the GLS agenda for council consideration.

Thank you. Do you have any questions or comments from council members or objections to the consent agenda? Seeing none, then we will move this motion to March consent agenda. Next is motion 20 six-one 111.

Thank you. The 2025 hazardous materials emergency preparedness grant program is intended to increase safety during hazardous materials in materials incidents. DEM was awarded a grant for a period of three years. The grant total year one is $28,502. There is an annual match requirement.

The match for year one is $7,609 and will be met with staff time. The grant award for years two and three has to be determined, but the grant total is anticipated to be under $90,000. Grant funds will be used to conduct annual three day hazmat trainings. Additionally, the local emergency planning committee will organize a functional exercise focused on responding to complex to a complex attack involving hazardous materials. The aim is to have all hazmat technicians achieve an advanced hazmat IQ level. The request is to move motion 26 dash one one one to the GLS agenda for to g s to the GLS agenda department.

Thank you. Do you have any questions or comments from council members or objections to consent? Seeing none, then we'll go ahead and move motion 21 dash one one one to March consent agenda. So those are our two action items. We do have one discussion item that we'll move on to. Our human services team is here to give our q four twenty twenty five affordable housing and chemical dependency and behavioral health sales tax report. So I'll invite MJ and Mike Lyticoat, and it looks like we also have Karen here. Welcome.

Good morning, council members. We're here to provide our quarterly report on the use of the chemical dependency and mental health sales tax and the affordable housing and behavioral health sales tax funds. We do these every other quarter, we do them in person. In between quarters, we, do them, just send submit a report for your review. So here's the report for the quarter that ended 12/31/2025.

So we're halfway through the biennium and the biennial budget process. We'll do a quick overview of the fund just as a reminder, provide the quarter four fiscal reports, the potential legislative actions, and, updates and evaluation. I will just warn you that what's on the slide and in for the updates from the legislative session are no longer accurate as of Friday. So we'll give you an update that's real, as opposed to what is on the slide. So just as a high level overview and reminder, the chemical dependency and mental health sales tax, was authorized under, RCW eighty two fourteen four sixty, and those funds may be used for capital cost, operating, delivery of chemical dependency and mental health treatment and services, including housing and for therapeutic court programs and services.

The program has been in existence since 2008, and programming began in 2009 with really going up full speed on 2010. We have two funds that make up the county's affordable behavior affordable housing and behavioral sales tax fund, and those are the more recently councilmatic funds that was produced under house bill fifteen ninety as well which is the one that has been under considerable discussion as in legislation right now. And the affordable housing and behavioral health sales tax authorized under RCW at fourteen five thirty, and that's the one we call house bill 14 o six. So, both of those funds do a lot of similar things. The 14 o six funds are actually, a rebate, if you will, of sales tax where the other is a new sales tax that have been passed by council.

So we've put those two together since there's so much similarity between them to create a broader fund. The purpose of which is really to facilitate and expedite the creation of affordable housing and behavioral health facilities. It the capital funds that they allow for services and for operating and maintenance for those programs, particularly on the housing side recognition that there are not housing vouchers from other sources to attach to that. So there's no point in building a house that you can't then or a property that you can't then, operate and maintain. So but it is first and foremost, how do we accelerate the development of capital projects in these areas?

So those are the two pots of money, and we'll be talking later about a a little bit later about the expanded use of those fifteen ninety funds that we'll we anticipate will pass. So for fiscal reports, we'll start out with a chemical dependency and mental health sales tax fund. This fund has been a very popular fund and being used, to its full extent. Basically, as you we here is what's, the first slide shows you what is being spent out of the human services department. So halfway through a biennial budget, you would expect, the expenditures to be at right about 50%.

We ordinarily just, because nobody wants to overexpand on these funds because that would spill over into the general fund. We plan for a 4% underexpenditure for the two year period. And as you can see on the human services side, both in terms of the staffing and our subcontracted services, we're right now at 47%. So that's we're right in the pocket of where we would want and expect to be on expenditures on that fund. On the next page are all the other departments' expenditures.

And collectively, while some are spending, nobody is spending over half of the funds other than OPD is point 4% over half, and we only have one fund significantly not spending according to plan, but at 45.8%, they are too right at that 4% under planned under expenditure amount on that fund. So, overall, we're right exactly where we would expect to be on expenditures midway through the biennium. The affordable housing and behavioral so I will add to that that that fund is now, at this point, actually fully subscribed. We will get through this this year with it being subscribed, fully subscribed, but there will the executive side will be having to take a hard look at how do we get that fund back into a little bit more robust state in the 2728 by a new budget? Now let Kara speak a

little bit to that. Yeah. Kara Main Hester, chief budget officer for the exec's office for the record. Just what MJ said is exactly right. Fully subscribed and fully subscribed to the point that, as you noticed, there is staffing that is funded with that fund. As we move into the 2728 biennium, we do not have the capacity in that fund to pay for the increased salaries and benefit costs of that staffing. So we will have to be looking at some reductions in that fund to maintain the service levels we currently have in that fund. So as you saw, there's staffing. There's a variety of different contracted services. And then there's within human services.

And then there's other departments that have a variety of services that are funded with CDMH. So CDMH is sorry. Let me add one more thing. There is no fund balance currently in CDMH. So we do not have a fund balance to rely on in order to make up the deficit. So we we really are in a situation with CDMH in particular that we need to do two things, both look at the balancing package, obviously, on it, but also look at what our fund balance policies are in that space. Any questions on that?

So how do you reduce so some of this is being expended in programs and some of it is in staff. So you're just talking about reducing programmatic spending to account for the increased cost of salaries and benefits.

That's exactly right.

That's Yep. Yeah. Thank you. I have

a question.

Go ahead.

So it's based on sales tax, and this is a anticipation of sales tax revenue going down?

I think that That is a tough question to answer right now. Sales tax revenue, historically, we've looked at sales tax revenue increases over time somewhere between, I mean, depending on what your look back period is, 5%, 6%, 7%. We've seen years where we've had a negative increase in sales tax. So we've had a loss year over year in sales tax. Given the current situation in The Middle East, frankly, no one knows where sales tax is going to go.

We are watching really closely the reports that are coming out. We have noticed that a lot of our reports that we depend on are actually being delayed. I suspect that the folks that do analyze sales tax revenue in the state of Washington also are a little worried about making projections right now. Last projection we had looked like 5% would be fine. I don't think any of us on that make up the revenue team agree with that at this point.

It's the same challenge we're looking facing with every single one of these, tax based, funds that the county operates. It's, where we're dealing with a lot of unknowns right now. Other questions, customer engineering?

Yeah. Thank you. So the programmatic cuts that would need to be made to balance CDMH, what what would be some examples of those?

Well, let's go back up into, you know, say, on the humans I'll just give examples out of the human services side. That's the safest place to do it. We are spending money, for example, on resources to go for the nurse family partnership program. That was one where we might be saying maybe that you know, there's two ways to approach this. One is where can you take targeted reductions and just kind of do belt tightening, and then are there whole lines of business?

Now nothing I'm saying here means that we are suggesting these are the lines of business. This is just strictly for examples. But for example, nurse family partnership is a program we could say, we can't afford to fund that at the same level, so would we be reducing that program? We could be saying, for example, seasonal shelter. Well, you know, the cost of this operating seasonal shelters have been increasing, but is that an area where we'd have to say maybe we have one less shelter? Again, these are strictly examples. I am not saying we have not done the analysis to say where we would make those cuts, but those are examples of the kinds of decisions I would have to

Okay. No. That's helpful. Thank you. Mhmm.

Oh, thank you. Alright. Thank you. Keep moving. Okay. So moving on to affordable housing and behavioral health fund. We we have the we have appropriate and obligated and a number of expenditures out of the funds. So let's start with the new start centers and the Linwood Crisis Response Center. We 13,300,000.0 is obligated for the construction of the two new start centers. 11,000,000 of that was expended on construction in 2025.

5,200,000.0 was obligated, and 2.67 expended committed for new start center operating and maintenance costs in 2025. The council approved site operator contracts, for that fund just recently, 2,680,000 for the Salvation Army and 2,100,000.0 for the YWCA. So those two entities are gonna start. They're moving in now to start operating the centers with the opening on the is it the twenty second or the twenty fourth? Twenty fourth.

The first of the Edmond Center coming up here on the twenty fourth. Everett will be a little bit later down the road here probably about a month. And, again, $3,000,000 was obligated for an interlocal agreement. While it was for a center for the city of Linwood, the dollars are actually interlocal is actually with the North Sound behavioral behavioral health ASO on behalf of the city of Linwood. So I wanna make that distinction, but those monies have now, been obligated.

So additional obligations for other capital projects, and we've separated out fifteen ninety and 14 o six because there are some, differences right now in how those funds can be used. They may not exist after this session. But for 1590 funds totaling 11,000,000 were obligated, 434,000 for the Seymour Community Health Centers, in Monroe, for a mental health and, substance use disorder clinic, 2,560,000.00 for the Compass Health Broadway redevelopment project, and that's really making that whole facility both a a housing and and behavioral health facility. 1,780,000.00 for the Hasco, 200 Street redevelopment in South County, and 6,200,000.0 for Housing Hope Properties, Everett United Church of Christ redevelopment. So those funds have been obligated in fourteen o six, and out of 5,000,000 were obligated, 3,200,000.0 for the Stillaguamish, two apartments over in in the Arlington area, 1,300,000.0 for the Catholic Housing Services Monte Cristo Apartments, Downtown Everett here, and another $3.3191000 going into the Hasco two hundred Street redevelopment project.

So those are all projects underway. Contracting is in some some state of of readiness, but those have already been obligated. We also appropriated another 3,000,000 for administration, but because this has taken longer, the on upgrade up getting up to speed on all these programs, we actually spent less than that and spent about 520,000 just because there was a large longer start up time. So we will be expanding at a faster rate now that these this whole, fund is up and running. And, any funds in any category that were not expended or returned to the fund balance for future appropriation.

So every time you go into a budget cycle, council has the authority to move those dollars around between categories. We also released, the the notices of fund availability for 2026, and those will, a NOFO was released for the behavioral health capital projects. A number of applications were received. Another NOFO for housing, projects. They have all been reviewed by the technical advisory committee and by the policy advisory board.

The ECAFs are in their process, going through the process. Right now, they're in Legistar and going through process. And so they shall be coming home forward to council here, this month through the, health health and community services committee, for your consideration. I'll just walk through quickly on the next slide what these what the their recommendations are. All $3,000,000 that were set aside in 1590 fund for behavioral health facilities are being recommended to be awarded to Granville Homes LLC for the Holman Recovery Center, project in, East County.

Actually, probably north more north and east. Excuse me. 20,000,000, have been, now this is, like, both what is interesting is coming forward from the PAB is both the '24 or '25 and '26 appropriations of $10,000,000 each. They're trying to they're moving them up because we have, you know, we have received those funds in hand. So they're saying take two years worth of funding for affordable housing and fund the following projects.

4,200,000.0 for helping hands project, a supportive housing, 5,800,000.0 for Everett Gospel Mission Bridge housing and that huge expansion of the campus there, 4,000,000 for the housing Hope Properties Everett United Church, redevelopment for senior housing, 2,900,000.0 for the Everett Station District Alliance for transitional transit oriented development, and 2,900,000.0 to Hasco for the 200 Street redevelopment. So they're saying because some of these projects can bring with them and attract to them low income housing tax credits, which can expedite the construction, the gathering of all the resources, construction more quickly. They said, let's they are recommending the council pushing all that money, the money for '25 and '26 forward so they're all considered at once. So, that will be coming forward for your review with, and consideration. So where are we at the end of, 2025?

Of the $5,000,000 that have been obligated for capital projects out of fourteen, fourteen, o six three point two five have been expended. That means out the door of the 24,000,000 set aside for $15.90 for capital of 13,500,000.0 have actually gone out the door, have been expended, and the others were all on, track to keep moving forward and, be expended. For the city of Lynnwood crisis response center, well, that the dollars have not changed change yet. Those are there. And the new start center operating and maintenance of the money's obligated for the biennium, 2,600,000.0 have been expended.

Again, we would expect that that cost will start ramping up very quickly once these become operational, which would be very shortly here. And, again, the dollars obligated for Salvation Army YWCA, they have not started spending yet, but will shortly. So and we already talked about administration, operation maintenance. So, those dollars are moving forward and and out the door, and we just wanted to just have on there what the ARPA dollars were that we're also involved in, having been obligated. So here's where everything has changed.

This slide is no longer valid. Forget about this slide. So the Washington state legislature, both the house and senate versions of of the legislation are making changes to house bill, 1590, that the bigger part of the money that we have in the affordable housing behavioral health fund. So that has moved, forward. And while the two there's the two houses have not agreed, there are a number of things they have agreed on that will we anticipate will show up in the final bill, and that is that fifteen ninety funds will be able to be used for rehabilitating existing affordable housing, which may include emergency transitional and supportive housing.

Operating and maintenance could be paid for out of $15.90 for both existing and new units, that the funds could be used to provide residents with essential ancillary services, providing residents with resources for basic living and well-being, providing rental assistance. So this no longer is just for Snohomish County in both sides of both houses. The bill would allow for the use of these funds for rental In our case, you know, again, the primary purpose of these funds are capital, but they felt like that this is one of several actions they've taken given that it's not clear what's gonna happen at the federal level in terms of paying for rental assistance for people who are already housed to stay in their housing. So we wanna make sure that, that Washington residents and Snohomish County residents are not, harmed in that process. And, for it it would allow for the entering of ILAs for the pooling of tax receipts.

So, again, the additional, the purpose of these additional changes to the system are to address any system disruptions that may be caused by the federal actions, most notably to the continuum of care right now, but it could be happening at in any of the federal programs and promote continuity of operations and stability for existing projects, including by maintaining renewal grant amounts at levels sufficient to support ongoing operations. In other words, there if we have to use those monies to keep what we already have afloat without doing harm to the residents of Snohomish County, they want us to have the flexibility to be able to do that. So with that, let's see. Evaluation, you know, we've gone through this before. We don't yet have people in there, so this is just a reminder slide.

We will start populating, an evaluation of the new start centers when people have moved in both on the efficacy of investments and of the systems level, inputs. And, again, here's just a picture of what that update will look like on a regular basis once we start moving people in, which by the next report, we'll hopefully have some people in one of these. And that is our update for the day on where we are with, those funds.

Thank you for doing that. Thank you for bringing that forward and giving us all the updates for the legislature. I know it's, like, fast moving.

Right? It's so fast moving. Updates there.

Do you any have questions from council members? Council member Dan?

Yeah. On on slide 10, you've got projects that are going to be coming to us. Yes. And then there's also a number on the chart that are still negotiating contracts. So projects that were were awarded Right. In, like, 2024 Right. And then still negotiating, and now we have the next batch. So I'm just seeing a lot still negotiating contracts. So what is kind of the average timeline right now between awarding I agree. Council for approval and then final contract?

It really depends on what their other fund sources are that they're bringing to the table. Be basically, what happens is this and is a complexity with all capital projects. I mean, if you're, like, a private a private builder, you go to a bank and say, I need x amount of money. There's one one party involved. You do the closing with one party, and then you start paying off the the the the cost of that.

They've been servicing the loan. In terms of these projects, they have got to bring every single one of these fund sources into alignment together, and then all of the funders agree to all the other funders, and they all sit down and close all of their loans at the same time. And so if it's not a particularly complex project and these it's not that they are not in contract. Some of these, I think, like, Seymour probably is in contract. They just we haven't started getting expenditures yet because that's a relatively small straightforward.

There's only, you know, one pot of money there. But in particular, you know, you see, for example, the Hasco 200 Street redevelopment. We've got three different awards, and they've got all the other lenders have different awards, multiple layers of awards too coming in because that's a multimillion dollar project. And to the extent possible, entities don't have those single loans from a bank that float them. If they did that, they they would not be, have to go through all these processes.

So depending on the complexity of the project, the number of fund sources, the timing of those fund sources, it can take anywhere from a few months to a few years to actually get that project into, where all the funders can sign and close and they can start construction. What people what people often don't realize is that with construction projects, once you stick a shovel in the dirt, it happens quickly. It's getting to the point of being able to stick that shovel in the dirt, not just on the financing side, but on the zoning, permitting, and all of those other processes that have to take place. And the more complex and big and complex the project is, the more likely that is to take more time.

Okay. Is that something that you're monitoring? Or Yes. Constantly. Council county side of when it's in our hands and our responsibility?

Yes. Yes. Absolutely. And we those dollars show up when we do our six year projections. Once those dollars are obligated, they're showing as obligated in the projections so that we know that we don't have those monies to spend somewhere else because it looks like we've got this big fund balance sitting there Right. Where, in fact, most of that fund balance is actually committed to projects already. So it's it's capital projects are a world unto themselves. And

you mentioned, you know, these are kind of first in dollars Yes. And that they can be used or leveraged or matched Yes. For federal awards. Uh-huh. It sounds like you're not planning to do a notice of funding for 2026. We don't have you don't have authority.

Right now, we do not have expenditure authority in the affordable housing line. We do actually have some expenditure housing in the supportive housing line as well as, of course, we've just released an offer for the the we have money in the behavioral health line. So I've just released a NOFO for that. And we'll be releasing a limited application, a competitive application under recovering housing because during the the The earmark. The earmark that that was that was created.

So we it's not that we have no money. Right now, we have no money in the affordable housing line. I know there are some providers who are saying, well, you know, could could you afford fund more of those dollars? At this point, we don't wanna ask for a supplemental appropriation because so many uncertainties. And so that's not to say we may not come back and ask for a supplemental appropriation, but we need the state legislature to wrap up. We need to know what's gonna happen at the federal level. I mean, we've been given authority to use these dollars to keep everything afloat, and we don't know what that looks like yet. We have run so many scenarios, but we don't know which one is gonna be the one that plays out.

I mean, my concern would be losing any federal matching dollars, especially Mhmm. For affordable housing Mhmm. And some of those low income tax credits to to lose some of that. What we're gonna take

care Right. I mean, we're not anticipating the the what the pad has made for recommendations was in line with the appropriation. And so, the state is going to make their decisions about the tax credits based on the information that they have in hand. And, the feds are actually operating a little bit different times time frame. Yes. Different way. But more I would say low income housing tax credits are the primary, thing that we look at, housing finance commission too. But they're gonna make their decisions based on how close to readiness do they think a project is, nothing and would prevent a project from coming back in a year later and asking for the same thing if that were a better timing for them.

Chair Dunn, just wanted to follow-up with your questions. I think one of the things that I have learned a lot about with working on some of these contracts with human services is figuring out a way figuring out ways to economize the the staff time necessary for the NOFOs is really valuable on the county side because that is the same staff that is actually writing contracts. So being thoughtful on that side is one thing to think about. And then I think we should all have our ears to the ground on what the processes are at the federal and state level to make sure that we are aligning. If there's some opportunity we're missing, you know, but there's only so many of us to pay attention to all of these different changes and and everything going on.

You know, bring that forward. We do want to use this funding, which is first in, which is unusual, to actually leverage every penny we can. So, you know, we're always, you know, working on that balancing act of economizing the staff time at the same time of taking advantage of all the opportunities. Do hope that by actually awarding these affordable housing projects earlier, that there was more information out into the ecosystem that allows affordable housing providers to go after more other types of funds. Right?

So you would hope, but I recognize that sometimes the timing doesn't work that way. So and I think as we get further into this, making all these timelines more predictable as we know more will be will be more helpful. Just don't know how realistic that is in the climate we're in right now.

I mean, I certainly understand the uncertainty. My worry is or my hope is just getting dollars into the community as quick as possible. So both contracts executed quickly or efficiently, effectively, but also that we're not kinda sitting on a a fund balance because of uncertainty, because getting things built and getting dollars out would be my preference.

Excuse me. We did not put it in this report, but in fact, our our six year projections, for this fund gets that fund balance down to $8,000,000 by the end of six years. So there's that is something that we're always looking at. And for the '27, '28, if we think that at the time that we go, the executive goes to do that budget, we think that those dollars that those appropriations in those various categories could be increased. We would certainly let that be known. And I think that was part of the PABSS recommendation in saying, let's take two years worth of funding since we've got it in the bank and award it all in one year. So these projects have more money to get going. Then

also on the slide so if we look on new start centers construction, it says planned deliverables, a 123 units. And then new start centers, o and m facilities, you also have a 123 units.

Well, it's it's the same. We're just people wanna know how many units were being impacted by Yeah.

But it it's almost it looks like we're serving a lot more people under deliverables because you're you're listing it twice. And then the services for Salvation Army and YWCA is also new start centers and is listed as persons served. Right. So it just gives the impression that we're helping, like, four times as many people. So maybe under plan to well, if it's just see above or see other We

can do that. Just looks like We can absolutely do that. Yeah. Thank you.

No more questions? Alright. Well, thank you all for being here. Thanks for the presentation. Appreciate all the time as always. That brings us to the end of our agenda and it also is the last meeting that we have as a council for today.

So

council will be adjourned. Thank you.