As the President & CEO of OlyFed, I’ve had the privilege of serving our community and witnessing the transformative power of homeownership. A provision in Washington State Senate Bill 5794 threatens to undermine these efforts by imposing a 2.1% tax on mortgage interest income, which would more than double the amount of taxes we pay. This will seriously jeopardize the bank’s ability to continue to find creative ways of supporting affordable housing in our community.At a time when other financial institutions have left the mortgage market altogether, this tax will specifically harm local community banks like OlyFed, but not big out-of-state banks or credit unions. As a mutual bank, we’re accountable to you, our customers, and as a portfolio lender, we do not sell our loans to conglomerates across the country. These relationships stay right here in our backyard and this proposal would tax the loans we retain for the greater good of our community.
It’s our business model which allows us to be flexible and creative in how we address issues like affordable housing. In fact, these past two years, OlyFed has provided more than $16 million in affordable home loans to households earning less than 80% of area median income.
We know homeownership means stability, community, the opportunity to build wealth and to access capital through equity. These are key differentiators when it comes to improving education levels, health outcomes and our overall quality of life.
It’s because of these life-changing results, we have been creative when others wouldn’t, helping to finance affordable housing projects in our community like Merritt Manor an 82-unit affordable housing project, as well as a project with the Family Support Center, which provides one of the area’s largest shelters, among many others.
Furthermore, in the last five years we’ve provided more than $2 million in local charitable support on top of our affordable housing efforts.
Just recently, OlyFed provided $100,000 to Interfaith works to help with the construction of their Unity Commons building, which provides emergency shelter for our area’s most vulnerable citizens. Even better, every time we close on a home loan, we donate to local nonprofits addressing affordable housing in our community through our Neighbor-to-Neighbor program.
The proposed tax threatens to take away these community investments at a time when they’re needed most. SB 5794’s supporters argue it’s a necessary step to reform Washington’s tax system, but taxing mortgage interest is a misguided approach undermining statewide efforts to promote equitable access to housing leaving fewer resources for the families and organizations we serve.
I urge our legislators to remove the mortgage interest tax from SB 5794 and let’s work together to find solutions that strengthen Washington’s Housing market by supporting first-time buyers, local affordable housing projects and community banks like OlyFed who continue to be a staple of good for our local economy and neighborhoods.
Sincerely,
Josh Deck
President & CEO
