Council Backs a Four-Year, No-Cap MFTE Catalyst to Jump-Start HOMA Housing

Bellevue Chamber  |  May 19, 2026

Bellevue City Council on May 19 directed staff to draft a four-year, no-cap MFTE Catalyst for the HOMA housing areas, choosing the most production-forward of the options on the table. The direction asks the Office of Housing to return with strike-draft code that establishes the Catalyst, sunsets it automatically after four years, and builds in a two-year look back so council can check the program against its goals before the term runs out.

What the Catalyst Actually Does

Bellevue's base Multifamily Tax Exemption gives a 12-year property tax exemption to projects that set aside at least 20 percent of units as affordable, with a requirement that units overlapping other affordable programs drop to deeper affordability. Office of Housing Director Bianca Siegel and Senior Affordable Housing Manager Hannah Vaughn Miller walked council through a Supercharger option that exempts HOMA projects from that drop, letting developers satisfy the requirement with units at 80 percent of area median income rather than splitting them between 80 percent and 65 percent. The Catalyst packages the Supercharger as a limited-term incentive aimed squarely at getting projects moving in a difficult construction market.

The Numbers Behind the Decision

The HOMA areas contain roughly 7,700 planned housing units in the Comprehensive Plan. Staff's formal recommendation was a six-year Catalyst capped at 1,500 units, about 20 percent of that planned growth. They also modeled a shorter four-year option with no unit cap, projecting roughly 1,200 participating units against the approximate 2,100 under the six-year version. The four-year option carried the lowest overall fiscal impact of the choices while still delivering strong monthly savings for renters, which is what moved a majority of councilmembers toward it.

“The most expensive housing in Bellevue is the housing that we will not build. That is the biggest impact that we have on our residents.” — Councilmember Vishal Bhargava

Where Council Landed

Councilmember Vishal Bhargava framed the four-year, no-cap approach and the rationale for dropping the unit ceiling: a hard cap creates a lottery-like uncertainty that can chill financing and concentrate development in the areas already easiest to build. He paired the proposal with a two-year look back to test whether the program is producing housing, hitting affordability targets, and managing its fiscal impact, and asked staff to explore faster permitting and design review for projects that reach deeper affordability. Deputy Mayor Hamilton aligned with the four-year, no-cap structure and the look back, crediting the market-rate and affordable housing partners who make projects pencil.

“We need and want more housing now, so our approach has to work in the market conditions as they currently exist. We need to keep our foot on the gas and we need to continue to add to our housing pipeline.” — Deputy Mayor Dave Hamilton

Councilmember Robinson was the most cautious voice, worried about precedent and the property tax revenue the city forgoes through the exemption. She supported the amendment on the condition that the Catalyst automatically reverts to the standard 10 percent at 80 percent AMI and 10 percent at 65 percent AMI after four years, with no further discussion required to end it. Staff confirmed the draft code would sunset the Catalyst at four years by default.

“This is kind of a deal we are making, and I want it to automatically revert. I also like the addition of a two-year look back, just to see if we are meeting our goals.” — Councilmember Lynne Robinson

What It Means and What Comes Next

The outcome tracks closely with what we and our partners in the Eastside Housing Roundtable have argued throughout the HOMA process: that a no-cap, time-limited incentive does more to unlock production in a tough market than a fixed unit ceiling, and that any new tool should come with clear accountability and a built-in review. Staff will now prepare the strike-draft code establishing the Catalyst Supercharger, its vesting provisions, and rules, allowing MFTE to be used alongside fee-in-lieu payments, and will return for council adoption. We will keep tracking the program as it moves from direction to code to the projects it is meant to support.

Read the Coalition Letter: Eastside Housing Roundtable on HOMA MFTE