wa-26-20-098: Commerce, Department of — WSR 26-20-098

WSR 26-20-098 (26-20)WSR 26-20-098PROPOSED RULESDEPARTMENT OF COMMERCE[Filed October 6, 2026, 3:06 p.m.]Original Notice.Preproposal statement of inquiry was filed as WSR 26-13-084.Title of Rule and Other Identifying Information: Establishing rules for a new community scale weatherization program enacted in HB 2338, chapter 94, Laws of 2026.Hearing Location(s): On November 12, 2026, at 9:00-10:00 a.m. PT, [via Zoom at https://wastatecommerce.zoom.us/webinar/register/WN_EkuSI-4rQ_qY1YZZI2OqLA#/registration].Date of Intended Adoption: November 18, 2026.Submit Written Comments to: Eric Wheeler, P.O. Box 42525, Olympia, WA 98504, email communityscale@commerce.wa.gov, beginning October 7, 2026, 9:00 a.m. PT, by November 12, 2026, 5:00 p.m. PT.Assistance for Persons with Disabilities: Contact Eric Wheeler, phone 360-725-2729, email communityscale@commerce.wa.gov, by November 5, 2026.Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: Implementation of 2026 legislation (HB 2338, 69th legislature, 2026 regular session) authorizing the department of commerce (commerce) to expand the existing low-income weatherization program described in chapter 70A.35 RCW to include community scaled projects. A community scaled project is a weatherization project that includes multiple dwelling units in the same neighborhood or area where overlapping factors, such as environmental, social, or economic conditions, may adversely impact residents, as determined by commerce. Community scaled projects are not subject to the requirement that all units in a weatherization project be occupied by low-income residents. However, commerce must prioritize projects that serve low-income households when selecting community scaled projects for grant funding. Further, community scaled projects have the flexibility to provide comprehensive or partial services for the units being served. Commerce is proposing new rules and revisions to the existing chapter to implement the program in accordance with statute. Reasons Supporting Proposal: The passage of HB 2338 (69th legislature, Laws of 2026) authorized commerce to expand existing rules for the use of funds appropriated to the existing low-income weatherization program described in chapter 70A.35 RCW for community scaled projects. A community scaled project is a weatherization project that includes multiple dwelling units in the same neighborhood or area where overlapping environmental, social, or economic conditions may adversely impact residents, as determined by commerce. Community scaled projects have the flexibility to provide comprehensive or partial services for the units being served and enable commerce to allocate weatherization funds more effectively and extend services to households that have previously lacked access. Rule making is required to update the low-income weatherization program rules in accordance with the recent statutory changes.Statutory Authority for Adoption: RCW 70A.35.090.Statute Being Implemented: RCW 70A.35.080.Rule is not necessitated by federal law, federal or state court decision.Name of Proponent: Department of commerce, governmental.Name of Agency Personnel Responsible for Drafting: Nick Manning, 1500 Jefferson Street S.E., P.O. Box 42525, Olympia, WA 98501-2355, 564-200-4324; Implementation: Allen Carbert, 1500 Jefferson Street S.E., P.O. Box 42525, Olympia, WA 98501-2355, 360-725-2845; and Enforcement: Laura Viik, 1500 Jefferson Street S.E., P.O. Box 42525, Olympia, WA 98501-2355, 360-764-0038.A school district fiscal impact statement is not required under RCW 28A.305.135.A cost-benefit analysis is not required under RCW 34.05.328. Commerce is not a listed agency in RCW 34.05.328.This rule proposal, or portions of the proposal, is exempt from requirements of the Regulatory Fairness Act because the proposal: Is exempt under RCW 19.85.030 (1)(a)(i).Explanation of exemptions: The proposed rule will not impose more-than-minor costs on a business in an industry.Scope of exemption for rule proposal:Is fully exempt.October 6, 2026Vanessa FinelliLegislative and Rule-making CoordinatorRDS-7404.1Chapter 365-180 WAC((ENERGY MATCHMAKERS))LOW-INCOME WEATHERIZATIONAMENDATORY SECTION(Amending WSR 09-22-065, filed 11/2/09, effective 12/3/09)WAC 365-180-030Definitions.(1) "Community" means the local program area served by the weatherizing agency.(2) "Community scale weatherization project" means a project for full or partial weatherization, energy efficiency measures, or structural rehabilitation and repairs for multiple residences located within the same neighborhood or area where overlapping factors including environmental, social, or economic conditions may adversely impact residents.(3) "Department" means the department of commerce.(((3)))(4) "Disadvantaged populations" means populations facing barriers to employment.(((4)))(5) "Energy efficiency measures" means installations or modifications of equipment or systems intended to reduce the energy consumption of a residence. The term may include, but is not limited to, upgrading water heating systems and installing heat pumps or other efficient electric equipment.(6) "Energy matchmakers local coordinated plan" means a proposal(s) for use of funding for local low-income weatherization programs in a specific geographical area.(((5)))(7) "Family wage job" is defined as a job that pays, as a minimum, prevailing wage.(((6)))(8) "Full weatherization" means the implementation and/or installation of all cost-effective, structurally feasible, and sustainable residential weatherization materials, measures, and practices necessary to improve the thermal efficiency and occupant health and safety of a residence, as identified through the department's required energy audit and associated assessment processes.(9) "Low-income" means households at or below ((eighty))80 percent of the state area median income. However, priority will be given to households at or below ((one hundred twenty-five))125 percent of the federally established poverty level.(((7)))(10) "Nonutility sponsor" means an organization that is not an energy supplier and that submits a local coordinated plan.(((8)))(11) "Partial weatherization" means the implementation and/or installation of some, but not all, cost-effective, structurally feasible, and sustainable residential weatherization materials, measures, and practices that improve the thermal efficiency and/or occupant health and safety of a residence, as identified either:(a) Through the department's energy audit and associated assessment processes; and/or(b) By the sponsor as a community need in response to a specific environmental exposure.(12) "Priority community," in the context of community scale weatherization projects, means a community which meets the criteria established in WAC 365-180-120(3).(13) "Residence" means a house or dwelling unit, including a stationary mobile home, an apartment, a group of rooms, or a single room occupied as separate living quarters; but excluding institutional buildings such as: A university, group care facility, nursing home, half-way residence, hospital, hotel, motel, etc.(((9)))(14) "Sponsor" means an organization that submits a match proposal as part of the energy matchmakers local coordinated plan.(((10)))(15) "Sponsor match" means the share, if any, of the cost of weatherization to be paid by the sponsor.(((11)))(16) "Structural rehabilitation and repairs" means measures intended to improve the durability of the structure (such as the foundation, framing, or roof, and more) and/or which are necessary prerequisites for energy efficiency measures or weatherization measures, as identified through the department's required energy audit and associated assessment processes.(17) "Weatherization" means materials or measures, including the education of the low-income household about energy saving behaviors in the home, and their installation or application, that are used to improve the thermal efficiency of a residence and/or health outcomes for occupants.(((12)))(18) "Weatherizing agency" means ((a public or nonprofit private organization, approved by the department, responsible for doing all aspects of the weatherization work))any approved department grantee, tribal nation, or any public service company, municipality, public utility district, mutual or cooperative, or other entity that bears the responsibility for ensuring the performance of weatherization of residences under this chapter and has been approved by the department.AMENDATORY SECTION(Amending WSR 88-02-042, filed 1/4/88)WAC 365-180-040Program funding.(1) The legislature determines the amount of funding available during a specific biennium for low-income weatherization, including energy matchmakers and community scale weatherization. Unless specified by the legislature, the department may allocate the total funding provided between programs at its discretion.(2) For energy matchmakers local coordinated plan funding, each county receives a "planning estimate" based on the number of low-income households and the climatic conditions of the county. This "planning estimate" is available for low-income weatherization in each county if matching requirements are met. Contingent on the availability of funds, the department may award funds in an amount that exceeds the county's "planning estimate."AMENDATORY SECTION(Amending WSR 88-02-042, filed 1/4/88)WAC 365-180-050Proposal for use of funding—Energy matchmakers local coordinated plan funding.(1) Any public or private organization in Washington, Idaho, or Oregon that conducts business in Washington state may propose energy matchmakers funding for a geographical area(s) by submitting an energy matchmakers local coordinated plan.(2) Plans submitted to the department shall be the result of local coordination and cooperation.(3) Plans shall identify weatherizing agencies.AMENDATORY SECTION(Amending WSR 92-03-019, filed 1/7/92, effective 2/7/92)WAC 365-180-060Sponsor match.(1) Energy matchmakers local coordinated plans submitted by energy suppliers shall include a commitment of a matching contribution. Matching contributions can be either cash, in-kind contributions, or both. The match must cover half of the total cost of the low-income weatherization being proposed in the local area.(2) Only resources that would not otherwise have been used for low-income weatherization will be considered as match.(3) A sponsor may pay the sponsor match as lump sum at the time of weatherization, or make yearly payments over a period not to exceed ((ten))10 years. When the sponsor elects to make yearly payments, the value of the payments shall be determined by the department, but shall not be less than the value of the lump sum that would have been made.(4) All match committed shall result in:(a) Increasing the number of residences weatherized;(b) Increasing weatherization measures installed on or in the residence; or(c) Otherwise increasing the thermal efficiency of the residence.(5) The department may place a cap on the amount of match it will accept under subsection (4)(c) of this section.(6) Match waivers may be granted by the department for plans submitted by nonutility sponsors.AMENDATORY SECTION(Amending WSR 09-22-065, filed 11/2/09, effective 12/3/09)WAC 365-180-070Energy matchmakers local coordinated plan—Funding proposal process—Award of contracts.(1) A sponsor shall make a formal proposal using forms issued by the department.(2) The employment requirements of RCW 70.164.040 (3)(e), apply only to individuals hired specifically to repair homes prior to weatherization, and to construct or install weatherization materials in low-income residences.(3) A review team will evaluate the energy matchmakers local coordinated plans, and will be composed of persons with knowledge of energy conservation and of community-based public and private service organizations.(4) Plans which include a commitment of matching resources will be given priority for funding.(5) The department shall have the final discretion to award funds.(6) The department will enter into a contract with weatherizing agencies identified in successful local coordinated plans. This contract shall be signed by an official with authority to bind the weatherizing agency and returned to the department prior to the release of any funds under this program.AMENDATORY SECTION(Amending WSR 88-02-042, filed 1/4/88)WAC 365-180-080Eligibility criteria for clients—Energy matchmakers.(1) Total income of all household members shall be at or below ((one hundred twenty-five))125 percent of the federally established poverty level; or households shall meet other qualifications established by the department for its low-income weatherization program.(2) Residences shall meet the qualifications established by the department for its low-income weatherization programs.AMENDATORY SECTION(Amending WSR 92-03-019, filed 1/7/92, effective 2/7/92)WAC 365-180-090Program services—Energy matchmakers.(1) Weatherizing agencies shall provide weatherization services to eligible low-income households in accordance with the "Washington state low-income weatherization assistance program procedures and guidelines" established by the department.(2) No contribution may be required from the eligible household.(3) Full levels of all cost-effective structurally feasible measures, as determined by the department, shall be installed when a residence is weatherized.(4) No undue or excessive enhancement to a residence shall occur as a result of weatherization provided under this chapter.(5) Before a leased or rented residence is weatherized, the department's "property owner/agency weatherization agreement" form, or subsequent special conditions established by the department when necessary to comply with applicable state or federal law, must be signed by the owner of the building or the owner's authorized agent. Through this form the landlord ensures that, at a minimum, during a period extending through one year following the date of completion of the weatherization work, the amount of rent will not be raised for any reason and during the period extending through three years following the date of completion of the weatherization work performed, rent will not be increased, nor the tenant evicted, as a result of the weatherization provided.(6) Benefits of weatherization work performed on behalf of a low-income tenant shall accrue primarily to the low-income tenant.NEW SECTIONWAC 365-180-100Proposal for use of funding—Community scale weatherization.(1) Any sponsor in the existing weatherization network may submit a proposal for funding for a community scale weatherization project for identified priority communities. Proposals must include the use of grant and any matching funds. Proposals must be submitted during the formal application period in response to a formal request issued by the department and adhere to all guidelines and instructions therein.Proposals received outside of the formal application period will not be considered for community scale weatherization funding.(2) Community scale weatherization proposals must explain which activities they are applying to implement for multiple residences within the same community. Activities may include:(a) Full weatherization;(b) Partial weatherization;(c) Energy efficiency measures; and/or(d) Structural rehabilitation and repairs.(3) Proposals submitted for community scale weatherization projects must include all required information as specified in the forms issued by the department including, but not limited to, identification of priority communities to be served by the community scale project. Priority communities are those which:(a) Score 7 or above on population living in poverty on the environmental health disparities map (EHDM);(b) Score 7 or above on unaffordable housing on the EHDM;(c) Score 7 or above on environmental exposures on the EHDM;(d) Score 7 or above on air quality-related respiratory disease on the EHDM; or(e) Are located on tribal land as defined in RCW 70A.02.010.NEW SECTIONWAC 365-180-110Community scale weatherization—Funding proposal process—Award of contracts.(1) The department may issue a solicitation for sponsor proposals that identifies criteria for a particular round of funding.(2) A sponsor may submit a formal proposal during the formal proposal period following the instructions on the forms issued by the department.(3) The employment requirements of RCW 70A.35.040 (4)(h) apply only to individuals hired specifically to repair homes prior to weatherization and to construct or install weatherization materials in low-income communities. (4) The department will select a team of reviewers within the department. The review team will evaluate the community scale weatherization proposals based on criteria identified in the solicitation and publicly available socioeconomic data.(a) The review team will consider all submitted information as required in the forms issued by the department. Proposals which satisfy the evaluation criteria listed in the forms issued by the department will receive higher scores. Evaluation criteria shall include, but are not limited to, proposals which:(i) Maximize energy efficiency;(ii) Extend the usable life of affordable homes within the priority community; and/or(iii) Improve the health and safety of residents.(b) The review team will consider publicly available socioeconomic data when evaluating proposals. Proposals will score higher based on the number of the following criteria that apply to the identified priority community:(i) Is located in a census tract that is at or below 125 percent of the federal poverty level; and/or(ii) Is located in a census tract that is at or below 80 percent of the state area average median income; and/or(iii) Ranks a 7 or higher on the population living in poverty layer on the environmental health disparities map (EHDM); and/or(iv) Ranks a 7 or higher on the socioeconomic factors theme rank layer on the EHDM; and/or(v) Is located on tribal land as defined in RCW 70A.02.010.(5) The department shall have the final discretion to award full or partial funds.(6) The department will contract with awarded sponsors who are selected by the review committee following the formal application period. This contract shall be signed by an official with authority to bind the weatherizing agency and returned to the department prior to the release of any funds under this program.NEW SECTIONWAC 365-180-120Program services—Community scale weatherization.(1) Weatherizing agencies shall provide weatherization services to implement awarded community scale weatherization projects in accordance with the guidelines established by the department. (2) No contribution may be required from a household within an eligible priority community.(3) No undue or excessive enhancement to a residence shall occur as a result of weatherization provided under this chapter.(4) Before a leased or rented residence is weatherized, the department's "property owner/agency weatherization agreement" form, or subsequent special conditions established by the department, must be signed by the owner of the building or the owner's authorized agent. Through this form, the landlord must agree that the rent on the residence will not be increased nor the tenant evicted as a result of weatherization.(5) Benefits of weatherization work performed within a priority community shall accrue primarily to the residents of that community.