The Connecting Housing to Infrastructure Program (CHIP) was created in 2021 to fund utility connections to affordable housing.
The program helps local governments encourage the creation of affordable housing by reducing or covering the cost of infrastructure associated with development.
CHIP connects affordable housing projects to utility systems, and can reimburse:
- Water and sewer line upsizing to serve increased density.
- Water and sewer line extensions to serve new infill development.
- Water, sewer and stormwater connections for affordable housing development.
- Water, sewer and stormwater connections for market rate housing when a minimum of 25% of the units are set-aside as affordable to low or moderate-income households.
- Regional stormwater systems or upgrades necessary to support housing development.
- System development charges waived for affordable housing.
Current funding
Commerce is now accepting applications for a new round of Connecting Housing to Infrastructure Program (CHIP) grants. Refer to the 2025-2027 CHIP Program Guidelines (PDF) for detailed information. Applications are due by Friday, Sept. 26.
Eligibility
A CHIP applicant must be a city, county or public utility district in partnership with an affordable housing developer. Projects must meet specific criteria:
- Located in a jurisdiction that imposes an affordable housing sales and use tax under RCW 82.14.530(1)(a)(ii) or RCW 82.14.530(1)(b)(i)(B), RCW 82.14.540, or RCW 84.52.105. This includes all counties and the cities within them except Stevens and Ferry counties.
- Located within the urban growth area (UGA) boundary.
- A minimum of 25% of the units are set-aside as affordable to low- or moderate-income households.
- The affordable housing development must begin construction within 24 months of the CHIP award.
- A strong probability of serving residents within the specified income levels for at least 25 years.
Funding details
CHIP is offering a range of funding options to support the development of affordable housing.
- $55 million for all eligible jurisdictions.
- $30 million for projects serving low-income households in jurisdictions with 150,000 or fewer residents.
- $5 million for projects serving moderate-income households in Chelan, Douglas and Okanagan counties.
CHIP application workshop
Commerce hosted a CHIP pre-application workshop on July 10.
Resources
CHIP connects affordable housing projects to utility systems, and can reimburse costs associated with water, sewer and stormwater improvements and waived system development charges. This includes upsizing water and sewer lines to serve increased density, and water and sewer line extensions to serve new affordable housing developments.
See the CHIP Handbook (PDF) for detailed guidance.
To be eligible for reimbursement for waived system development charges, the applicant must have in place, or put in place, an ordinance which reduces system development charges for affordable housing units, as authorized by RCW 35.92.380 and 36.94.370.
Examples include:
- City of Bellingham’s Ordinance 2015-07-029
- King County Wastewater’s website, which shows how system development charges are levied across a variety of housing types, with a reduction to 0.32 RCEs for affordability.
Since 2021, CHIP has awarded nearly $98 million to support the development of more than 9500 affordable housing units, helping to create housing for the most vulnerable segments of our population. To learn more about previous funding cycles and who was funded, see the following: