Chelan weighs $77,480 in housing grant requests with just $50,000 available

CHELAN — Two local organizations seeking to expand affordable housing have requested a combined $77,480 from a city grant program with just $50,000 available, leaving the Chelan City Council to determine how much assistance each should receive.

The requests, presented during the Oct. 27 council meeting, come from Chelan Valley Housing Trust and Lake Chelan Valley Habitat for Humanity, both of which are working to increase housing opportunities for residents who struggle with the area's high housing costs.

The Housing Trust has requested $50,000 toward construction of the first six homes in its Chelan River Heights development, a planned 54-home project along Anderson Road. Construction is expected to begin in 2027, with the development planned in two phases of 27 homes each.

Habitat for Humanity is requesting $27,480 for two purposes: $21,480 to cover water and sewer connection fees for two homes in its Pumpkin Lane development, and $6,000 to support administration of its critical home repairs program.

Pumpkin Lane is planned to include nine homes for income-qualified buyers earning between 40% and 80% of the area's median income. Habitat's home repairs program helps lower-income homeowners, including seniors and people on fixed incomes, maintain safe housing.

Finance Director Heidi Evans explained that the city has approximately $132,000 in its affordable housing fund, but council previously designated a maximum of $50,000 for awards during the 2026 application cycle.

The two requests exceed that allocation by $27,480.

If council were to distribute the $50,000 proportionally, each organization could receive approximately 64.5% of its requested amount. That would provide about $32,266 to Chelan Valley Housing Trust and $17,734 to Habitat for Humanity. Council members did not discuss that allocation method during the meeting, and no funding decision was made.

But it's a useful method for explaining why the city may not decide to simply split the money evenly between the two organizations: if each got half of the available funds, it would account for nearly all of Habitat's request, but only half of what the Trust is seeking.

The city could also award different amounts based on project needs, eligible funding sources and other considerations. Evans explained that the city must distinguish between restricted and unrestricted housing funds when determining which expenses can be supported.

Of the approximately $132,000 currently in the affordable housing fund, she said $15,600 is restricted and $116,000 is unrestricted.

The Housing Trust's construction request and Habitat's utility connection fees qualify for the more restricted state-shared tax revenue. Some of Habitat's requested administrative expenses would need to come from unrestricted funds.

Councilmember Tim Hollingsworth, who serves on the Chelan Valley Housing Trust's board of directors, recused himself before the presentation and left the council chambers for the discussion of both applications.

Council members asked about the projects, the available funding and the timetable for making a decision. Some requested additional time to review the applications, along with a staff recommendation for how the money might be distributed.

Evans said staff hoped to bring the matter back for an award decision before the end of the year. The city can provide council members with the complete application materials, including financial and project information not included in the meeting packet.

The council adopted an updated affordable housing grant policy in August and opened a special application period for 2026. The program is expected to make another $50,000 available for grants in 2027.

Later in the meeting, after Hollingsworth had returned to the council chambers, Mayor Erin McCardle praised the city's separate partnership with the Housing Trust on infrastructure for the River Heights development.

McCardle said the city had worked with the organization to secure funding through the state's Connecting Housing to Infrastructure Program, helping cover infrastructure expenses that otherwise could have added more than $2 million to the project's development costs.

She described the partnership as an example of how the city can help reduce the cost of building affordable housing in the community.

That infrastructure grant is separate from the $50,000 housing grant allocation now under consideration.

Council took no action on either application Oct. 27. The requests are expected to return for further discussion before any funding awards are approved.

Andrew Simpson: 509-433-7626 or andrew@ward.media