The Capital Budget Committee on Feb. 25 received testimony on substitute House Bill 18 08, which would establish an Affordable Homeownership Revolving Loan Fund at the Department of Commerce to finance permanently affordable homeownership projects developed by nonprofits or government entities.

Committee staff described the program elements: loans would be awarded to nonprofit developers for construction of permanently affordable homes for households earning below 80% of area median income; qualifying projects must include a deed restriction or ground lease of at least 99 years and a resale restriction to preserve affordability, as well as a right of first refusal for the sponsor. Loans generally would not exceed 50% of total project cost. Repayment of the principal and interest would be directed into a new revolving account to finance additional projects. Commerce may use up to 3% of appropriation for administrative costs; the program is subject to appropriation, staff said.

Sponsor Representative Janice Zahn said the measure aims to expand permanently affordable homeownership as a pathway to stability and generational wealth. “This bill provides a revolving loan fund under Commerce that would allow affordable home ownership units to be built,” Zahn said. She told the committee the program’s lower interest loans would help projects move forward amid high construction costs and elevated financing rates.

Ryan Donahue of Habitat for Humanity Seattle‑King‑Kittitas Counties testified in strong support, saying the program would give affordable‑homeownership developers another tool to close project financing stacks and could save public dollars over time because repaid loans are reused. Donahue suggested starting with a pilot funding level on the order of $10 million–$20 million and said the program could scale to higher amounts if appropriations allow.

Staff said a fiscal note from Commerce was requested but not yet available at the time of the hearing. The committee closed testimony after receiving support from affordable‑housing providers and noted that the measure is subject to appropriation and to further fiscal review.