New building tariffs could make it harder to buy a home in WA

New electrical service could hike up costs for homeowners in Washington.

According to a press release from the Building Industry Association of Washington (BIAW), Puget Sound Energy (PSE) is proposing 30% and 40% tariff increases for line extensions. This would include charges to new service lines and extensions, as well as extensions to plats.

BIAW argued that these tariffs are too high and could impact the future of home building.

“These increases will be catastrophic to the home building industry in Washington state,” BIAW Legislative Director Andrea Smiley said. “Already 80% of households in Washington can’t afford a median-priced home. Every added cost prices more households out of homeownership.”

BIAW noted that one of the best ways to build homes in Washington is directly on undeveloped plats. With PSE’s proposal, this means that the new cost development would be $82.69 per linear foot, according to the BIAW. This means that new home buyers could see an impact of cost increases anywhere from $760 to $1,500 per plat.

“Washington residential home builders struggle to keep up with the demand for new and affordable housing in Washington,” Smiley said. “Ever-rising costs of materials, permits, impact fees, and other regulatory costs only make it worse.”

Washington residents already paying too much

A report by the Washington Department of Commerce stated that Washington needs to build 1.1 million homes over the next 20 years in order to keep up with housing needs projections. In 2021, the Growth Management Act (GMA) found that in order to prioritize affordability, housing and utilities “should cost no more than 30% of household income.” Yet, recent federal data finds that most Washington residents are currently paying more than that.

“Builders in PSE’s service area cannot bear the cost of this nearly 40% increase,” Smiley said. “Because they have to show a level of profit to qualify for financing to build new homes, they will be forced to pass this cost on home buyers, making new homes even less affordable.”

PSE’s request is currently being reviewed by the Washington Utilities and Transportation Commission (UTC). BIAW is urging the UTC to “consider the harm a 30% to 40% tariff increase for PSE-exclusive services will cause homeowners, home builders, and the public.”

Those who want to submit public comments on the matter can do so by visiting this form.