yrr ^ IN CLIRKS OFFICE '. COURT. amiE OF FMSHMSRM DATE
CHIEF This opinion was filed for record at M.iKon ao ^ ;;Qt *=?
Susan L. Carlson Supreme Court Clerk
IN THE SUPREME COURT OF THE STATE OF WASHINGTON
WASHINGTON STATE HOUSING FINANCE COMMISSION, a public body Corporate and politic of the State of Washington,
NATIONAL HOMEBUYERS FUND, INC., f/k/a Homebuyers Fund, Incorporated, a California nonprofit corporation; GOLDEN STATE FINANCE AUTHORITY, f/k/a California Home Finance Authority, f/k/a/ California Rural Home Mortgage Finance Authority, a California joint powers authority; RURAL COUNTY REPRESENTATIVES OF CALIFORNIA, f/k/a Regional Council of Rural Counties, f/k/a Mountain Counties Water Resources Association, a California nonprofit corporation,
Respondents. No. 96063-1
Filed: JUL 2: 5 2019
YU, J. — This case asks us to review whether petitioner Washington State
Housing Finance Commission (Commission) has standing to challenge respondent Wash. State Hous. Fin. Comm 'n v. Nat'I Homebuyers Fund, /«c., No. 96063-1
National Homebuyers Fund's (NHF)' authority to provide down payment
assistance to Washington residents in conjunction with federally insured
mortgages. The Commission is a Washington public body with delegated
authority to provide down payment assistance within the state in a governmental
capacity. NHF is a California nonprofit corporation established by several
California counties to offer down payment assistance to home buyers nationwide.
The Commission alleges that NHF is falsely claiming governmental authority
when it provides down payment assistance in Washington, thus its activities
impermissibly compete with the Commission's own activities. The Commission
brought this suit to challenge NHF's alleged lack of authority to operate in this
The Court of Appeals reversed the trial court's summary judgment in favor
of the Commission on the basis that the Commission lacked standing. We reverse
and hold that the Commission has standing to bring this action. In doing so, we
express no opinion on the merits of the Commission's claims.
Factual Background and Procedural History
The legislature, in response to a serious shortage of affordable housing,
established the Commission in 1983 for the purpose of making "additional funds
' Also named as defendants are the two associations of California counties that created NHF, Rural County Representatives of California and Golden State Finance Authority. Wash. State Hons. Fin. Comm'n v. Nat'l Homebuyers Fund, Inc., No. 96063-1
available at affordable rates to help provide housing throughout the state." Laws
OF 1983, ch. 161, § 1; RCW 43.180.010. The Commission accomplishes this
mission without using public funds or lending the credit of the state through bond
issuances and revenue it generates from its housing programs. One of these
programs assists low-income and first-time home buyers qualify for a mortgage by
lending them funds for the required down payment. These are low or no interest
loans that do not need to be paid back until either the primary mortgage is paid or
the home is sold.
NHF is a California nonprofit public benefit corporation formed by Rural
County Representatives of California (RCRC) and Golden State Finance Authority
(GSFA). RCRC is a California nonprofit mutual benefit corporation founded by
several counties in California to provide services to those counties and advocate on
their behalf. GSFA is a joint powers authority created by these same counties to
offer home ownership assistance to their residents. NHF was formed for the
purpose of providing down payment assistance to low- and moderate-income home
buyers throughout the United States. The assistance comes in the form of a gift
(which NHF also calls a grant) of up to five percent of the purchase price, which
the home buyer does not need to repay.
Both the Commission and NHF offer their programs in conjunction with
primary mortgages that are insured through the Federal Housing Administration's Wash. State Hons. Fin. Comm 'n v. Nat'I Homebuyers Fund, Inc., No. 96063-1
(FHA) mortgage insurance program. Each partners with participating lenders that
provide the primary mortgage. These insured loans are then purchased, bundled
into mortgage backed securities, and sold for a profit on the open market. The
Commission reinvests these proceeds into its housing programs that benefit
Washington residents. NHF also uses a portion of its proceeds to expand its
housing programs nationwide and distributes excess funds to RCRC to benefit its
The FHA, a part of the United States Department of Housing and Urban
Development (HUD), promotes home ownership for those who may not qualify for
a conventional mortgage by protecting lenders against losses in the event the
borrower defaults on the loan. These loans are made by FHA approved lenders,
who must ensure the loans comply with detailed undei-writing guidelines published
by HUD.^ One such requirement is that the home buyer pay a minimum 3.5
percent down payment. See 12 U.S.C. § 1709(b)(9)(A).
FHA restricts where the funds for this minimum down payment can come
from. Borrowers may receive gifts from certain sources, such as family members,
charitable organizations, and government housing programs. But no part of the
minimum down payment can come from a "person or entity that financially
^ Our discussion of the requirements of the FHA mortgage insurance program is meant to provide context to the Commission's claims, not to interpret federal law. Wash. State Hous. Fin. Comm. 'n v. Nat'I Homebuyers Fund, Inc.,No. 96063-1
benefits from the transaction." 12 U.S.C. § 1709(b)(9)(C)(i). This restriction does
not apply to gifts or secondary loans made by a government entity acting in its
governmental capacity within its jurisdiction. Federal Housing Administration:
Prohibited Sources of Minimum Cash Investment Under the National Housing
Act—Interpretive Rule, 77 Fed. Reg. 72,219, 72,220 (Dec. 5, 2012).
These requirements are at the center of the dispute between the parties. The
Commission is an "instrumentality of the state exercising essential government
functions." RCW 43.180.040(1). The legislature has authorized the Commission
to "secure to itself and the people of the state the benefits" of federal housing
programs by making loans for down payment assistance. RCW 43.180.050(1 )(d)-
(e). The Commission alleges that NHF is falsely asserting the same governmental
authority in Washington by providing funds that only authorized government
entities can provide and marketing itself as governmental.
NHF disputes these allegations. It asserts that while it meets HUD's
definition of a government entity (because it is exempt from federal taxation
pursuant to section 115 of the Internal Revenue Code), it is acting in a proprietary,
rather than governmental, capacity when it gifts funds to borrowers in Washington.
In NHF's view, it is not an "entity that financially benefits from the transaction"
within the meaning of 12 U.S.C. § 1709(b)(9)(C) because it receives revenue only
from the sale of mortgage backed securities, not from the individual loan Wash. State Hons. Fin. Comm 'n v. Nat'l Homebuyers Fund, /«c., No. 96063-1
transactions. Consequently, it does not need to invoke the exception for
government entities acting in their governmental capacity.
The Commission filed this lawsuit in 2015, arguing that NHF was
unlawfully invoking governmental authority in this state and interfering with the
Commission's mission and programs. The Commission sought a declaratory
judgment that NHF's ongoing activities in Washington are unauthorized and may
not continue. The Commission also sought an injunction prohibiting NHF from
any further provision of homeownership financing services in Washington.
The parties filed cross motions for summary judgment based on these
arguments, both of which were denied. On reconsideration, the trial court granted
the Commission's request for declaratory relief and declared that NHF's "housing
activities in the State of Washington are prohibited by law." Clerk's Papers (CP)
at 1287 (footnote omitted).
NHF appealed this decision and claimed that the Commission lacked
standing to bring the lawsuit.^ The Court of Appeals held that the Commission
lacked standing because it did not show that it was within the zone of interests that
a statute was intended to protect and it had not demonstrated sufficient economic
injury. The Court of Appeals did not reach the other issues and, instead, reversed
^ NHF also maintained its claim that the court lacked personal jurisdiction over RCRC and GSFA. Wash. State Hons. Fin. Comm 'n v. Nat'l Homebuyers Fund, Inc., No. 96063-1
and remanded with directions to dismiss. Wash. State Hons. Fin. Comm 'n v. Nat'l
Homebuyers Fund, Inc., No. 76510-8-1, slip op. at 10 (Wash. Ct. App. June 11,
2018) (unpublished), http;//www.courts.wa.gov/opinions/pdf/765108.pdf. The
Commission petitioned for review, which we granted.
Whether the Commission has standing to bring this declaratory judgment
Standing generally refers to a particular party's right to bring a legal claim.
When declaratory relief is sought, the Uniform Declaratory Judgments Act
(UDJA), chapter 7.24 RCW, provides that "[a] person . . . whose rights, status or
other legal relations are affected by a statute . . . may have determined any question
of construction or validity arising under the . . . statute . . . and obtain a declaration
of rights, status or other legal relations thereunder." RCW 7.24.020. We utilize
the common law doctrine of standing to clarify the boundaries of this broad
statutory right."^ Grant County Fire Prot. Dist. No. 5 v. City of Moses Lake, 150
The requirements for standing often overlap with the requirement that the lawsuit present a justiciable controversy. To-Ro Trade Shows v. Collins, 144 Wn.2d 403, 411, 27 P.3d 1149 (2001) (quoting Diversified Indus. Dev. Corp. v. Ripley, 82 Wn.2d 811, 815, 514 P.2d 137 (1973)). In its motion for summary judgment, NHF argued that the justiciability requirement was not met because any determination would be advisory rather than final and conclusive. On appeal, NHF argued only that the Commission lacks standing, so we need not address the remaining justiciability requirements. See Five Corners Family Farmers v. State, 173 Wn.2d 296, 302 n.2, 268 P.3d 892 (2011). Wash. State Hons. Fin. Comm'n v. Nat'I Homebuyers Fund, Inc., No. 96063-1
Wn.2d 791, 802, 83 P.3d 419 (2004). Standing is a question of law that we review
de novo. City of Snoqualmie v. Constantine, 187 Wn.2d 289, 296, 386 P.3d 279
We have established a two part standing test in order to establish that a
party's "rights, status or other legal relations are affected by a statute." RCW
7.24.020; Five Comers Family Farmers v. State, 173 Wn.2d 296, 302, 268 P.3d
892 (2011). First, we determine "whether the interest sought to be protected is
'"arguably within the zone of interests to be protected or regulated by the statute or
constitutional guarantee in question.'"" Grant County, 150 Wn.2d at 802 (quoting
Save a Valuable Env't v. City ofBothell, 89 Wn.2d 862, 866, 576 P.2d 401 (1978)
Ass'n of Data Processing Serv. Orgs., Inc. v. Camp, 397 U.S. 150, 152-
53, 90 S. Ct. 827, 25 L. Ed. 2d 184 (1970))). If so, we then determine "whether the
challenged action has caused "'injury in fact,"' economic or otherwise, to the party
seeking standing." Id. (quoting Save a Valuable Env't, 89 Wn.2d at 866). A party
seeking standing must satisfy both prongs of the test. Branson v. Port of Seattle,
152 Wn.2d 862, 876, 101 P.3d 67 (2004).
The UDJA is to be "liberally construed and administered." RCW 7.24.120.
Thus standing is not intended to be a particularly high bar. Instead, the doctrine
serves to prevent a litigant from raising another's legal right. Grant County, 105
Wn.2d at 802. But even when a party does not meet the requirements of our two Wash. State Hons. Fin. Comm 'n v. Nat'l Homebuyers Fund, Inc., No. 96063-1
part test, we sometimes relax these requirements when a matter of substantial
public importance would otherwise evade review. Id. at 803.
The Court of Appeals held that the Commission failed to satisfy either part
of the standing test. We disagree. The statute that authorizes the Commission to
exercise governmental authority also confers an interest against interference fi-om
unauthorized actors that purport to exercise similar governmental authority. The
Commission has also alleged injury related to that interest sufficient for standing.
Since the Commission satisfies our standard two part test for standing, there is no
need to resort to the more liberal approach to standing we reserve for matters of
substantial public importance. However, such an approach would be justified in
A. The interest the Commission seeks to protect is arguably within the zone of interests of the Commission's enabling statute
To satisfy the first part of the standing test, the Commission must identify
the interest it is seeking to protect and show that the interest is arguably within the
zone of interests protected or regulated by a particular statute. Id. at 802. The
Commission argues that the statute that authorizes it to exercise governmental
authority when it participates in the FHA mortgage insurance program implicitly
prohibits others from acting in the same governmental capacity in Washington
without similar authorization. We agree that the Commission's interest is arguably
within the zone of interests protected by its enabling statute. Wash. State Hons. Fin. Comm 'n v. Nat'l Homebuyers Fund, Inc., No. 96063-1
Our case law establishes that an actor authorized by the state to participate in
a restricted area has standing to enjoin those that lack similar authorization from
competing in that area. See Day v. Inland Empire Optical, Inc., 76 Wn.2d 407,
416-17, 456 P.2d 1011 (1969); Puget Sound Traction, Light & Power Co. v.
Grassmeyer, 102 Wash. 482, 489-90, 173 P. 504 (1918). And we have allowed
authorized government entities to bring suit against competing government entities
to establish the boundaries of each party's authority. See Skagit County Pub.
Hosp. Dist. No. 304 v, Skagit County Pub. Hosp. Dist. No. 1, 111 Wn.2d 718, 305
P.3d 1079 (2013); Alderwood Water Dist. v. Pope & Talbot, Inc., 62 Wn.2d 319,
382 P.2d 639 (1963). Taken together, these cases support the proposition that a
party that has been delegated the authority to act in a governmental capacity in a
particular area has an interest against interference from others who purport to
exercise similar governmental authority without authorization.
Day involved a dispute between licensed ophthalmologists related to a
statute that prohibited doctors from receiving any kind of compensation for
referrals. 76 Wn.2d at 409. Plaintiffs sought to enjoin certain fellow
ophthalmologists from practicing medicine while simultaneously operating a
prescription optical business, claiming that the profits earned from referring their
own patients to the optical business violated the statute. Id. In addressing
standing, we reaffirmed our precedent holding that members of a licensed
10 Wash. State Hons. Fin. Comm 'n v. Nat'l Homebuyers Fund, Inc., No. 96063-1
profession have a legal and equitable right to seek injunctive relief against
competitors operating without a license. Id. at 417; see also Grassmeyer, 102
Wash, at 490 (holding that authorized streetcar operator entitled to injunctive relief
against unauthorized competitor).
Similarly, we have allowed municipal corporations to challenge
unauthorized competition within their geographic territories from other
government entities. In Alderwood, we were presented the question of "whether a
municipal water district of this state can directly furnish water to the inhabitants of
an area located outside the boundaries of such district but within the boundaries of
another water district." 62 Wn.2d at 320. Both water districts were created
pursuant to Title 57 RCW, and both were subject to a statute that stated "a water
district may provide water services to property owners outside the limits of the
water district." Id. (citing former RCW 57.08.045 (1953)). We interpreted the
statute to mean that a water district may provide services outside its territory only
to areas not within the territory of another district. Id. at 323. While standing was
not at issue in the case, Alderwood clearly stands for the proposition that a
government entity granted authority to operate in a particular space has an interest
against competition fr om others that lack the same authority. See also Skagit
County, 111 Wn.2d at 723-30 (applying Alderwood in the context of public
11 Wash. State Hons. Fin. Comm 'n v. Nat'I Homebiiyers Fund, Inc.,'Ho. 96063-1
These same principles apply here. The legislature has delegated authority to
the Commission to perform an essential governmental function by participating in
the FHA mortgage insurance program in a governmental capacity. RCW
43.180.050(l)(e). As such, the Commission has an interest in preventing
unauthorized actors from asserting similar authority.^
Even when a party has a demonstrated interest at stake, it must still show
that the interest is arguably within the zone of interests regulated or protected by a
particular statute. Grant County, 150 Wn.2d at 802; To-Ro Trade Shows v.
Collins, 144 Wn.2d 403, 414, 27 P.3d 1149 (2001). In Day and Grassmeyer, the
statutes that authorized the parties to act in their respective areas also specifically
prohibited others from doing so without authorization. Thus, the interest against
unauthorized competition was clearly within the zone of interests "regulated or
protected" by the statutes. Since the Commission's enabling act, chapter 43.180
RCW, does not specifically contain a similar prohibition, we must determine if one
is nonetheless implied.
^ Both the dissent and the Court of Appeals find it significant that the delegation of governmental authority to the Commission in chapter 43.180 RCW is not exclusive. See dissent at 3-4; Wash. State Hous. Fin. Comm 'n, No. 76510-8-1, slip op. at 8. But the Commission has never claimed exclusive authority. Instead, the Commission argues that "the mere fact that the legislature has delegated similar authority to local Washington government agencies does not bar the Commission from challenging NHF's lack of authority." Pet'r Wash. State Hous. Fin. Comm'n's Suppl. Br. at 11 (emphasis omitted). All parties agree that both the Commission and the local entities are authorized to act in a governmental capacity in this area. The Commission's challenge is based on NHF's alleged lack of any kind of authority to operate as a government entity anywhere in Washington.
12 Wash. State Hons. Fin. Comm 'n v, Nat'l Homebuyers Fund, Inc., No. 96063-1
To ascertain whether a party's interests are arguably within the zone
regulated or protected by the statute in question, we look to the statute's purpose
and operation. Five Corners, 173 Wn.2d at 304-05. The purpose of chapter
43.180 RCW is to authorize the Commission to perform a "recognized
governmental function" by acting "as a financial conduit which, without using
public funds or lending the credit of the state or local government, can issue
nonrecourse revenue bonds and participate in federal, state, and local housing
programs and thereby make additional funds available at affordable rates to help
provide housing throughout the state." RCW 43.180.010; see also RCW
43.180.040(1) ("The commission is an instrumentality of the state exercising
essential government functions."). In furtherance of this purpose, the Commission
is specifically authorized to "[pjarticipate fully in federal and other governmental
programs . . . to secure to itself and the people of the state the benefits of those
programs and to meet their requirements." RCW 43.180.050(l)(e) (emphasis
added). Thus, the statute operates to create a self-funded entity with the delegated
authority to act on behalf of the state. It is axiomatic that an entity cannot exercise
the authority of the state without authorization to do so. Thus, the Commission's
interest against interference from competitors purporting to exercise such authority
without authorization is implicit within its enabling act.
13 Wash. State Hous. Fin. Comm 'n v. Nat'l Homebuyers Fund, Inc., Fio. 96063-1
As an authorized actor in a restricted area, the Commission has an interest in
excluding unauthorized actors from that space. That interest is within the zone of
interests of the statute that grants the authority. Thus the Commission has satisfied
the zone of interests test.
B. The Commission has alleged sufficient injury for standing
The second part of the standing test asks whether the challenged action has
caused injury in fact, economic or otherwise, to the party seeking standing. Grant
County, 150 Wn.2d at 802. The Court of Appeals held that the Commission failed
to show injury in fact because it did not provide specific evidence of economic
loss. Wash. State Hous. Fin. Comm'n, No. 76510-8-1, slip op. at 10. This
application of the injury in fact test is overly strict.
The injury in fact part of the standing test precludes those whose injury is
speculative or abstract, rather than actual, fr om bringing an action. Grant County,
150 Wn.2d at 802. Our cases analyzing this part of the test have looked to the
type of injury alleged rather than proof of the extent of that injury. For example, in
a challenge to a statute that authorized a particular method of annexing land to a
city, the fact that landowners would face a different tax rate if their land were
armexed was sufficient injury for standing. Id. at 802-03. Even an inference of
noneconomic injury is enough to establish injury for purposes of standing. Thus a
special interest group satisfied the injury in fact test when its goals of preventing
14 Wash. State Hons. Fin. Comm 'n v. Nat'l Homebuyers Fund, 7nc,, No. 96063-1
substance abuse could reasonably be affected by an initiative restmcturing the
state's liquor regulations. Wash. Ass 'n for Substance Abuse & Violence Prevention
V. State, 174 Wn.2d 642, 653, 278 P.3d 632 (2012).
The Commission alleges actual rather than speculative or abstract injury.
First, the Commission complains that NHF's operations in Washington have
diverted funds from its programs. In 2014 and 2015, NHF made grants in excess
of $31.6 million to provide down payment assistance for loans totaling over $688
million to Washington residents. The record shows that when NHF suspended its
program in Washington in 2016, some lenders switched to the Commission's
programs in direct response. CP at 680-86. While the record does not show
exactly how much revenue the Commission may have lost due to NHF's activities,
the evidence is sufficient to support an inference that the Commission has suffered
at least some economic injury.
The Commission also alleges that NHF has caused confusion among
borrowers and lenders regarding NFFF's status and relationship to the Commission.
When NHF began offering its program in Washington, commission staff fielded
numerous inquiries from lenders who thought that NHF was a commission
program or that NHF had partnered with the Commission. CP at 388-89, 415.
When an organization's constituency is confused, its reputation suffers. Thus the
Commission had to either expend effort to clear up the confusion caused by NHF's
15 Wash. State Hons. Fin. Comm 'n v. Nat'I Homebuyers Fund, Inc., No. 96063-1
activities or face diminished goodwill from those it serves. Either way, the
Commission is affected. In an open market, responding to disruptions and
confusion caused by competitors is part and parcel of doing business. There is no
actionable injury because there is no interest against competition. Here, on the
other hand, the Commission asserts an interest as an authorized participant in a
restricted area in being free from unauthorized competition. And confusion caused
by an unauthorized actor is an injury related to that interest.
The Commission satisfies the injury in fact prong of the standing test. The
record supports an inference of economic harm from diverted revenues and
noneconomic harm resulting from confusion among borrowers and lenders after
NHF's entry into Washington.
C. This case raises issues of substantial public importance
Our conclusion that the Commission has standing is supported by the public
importance of the issues raised. On occasion, this court has taken a '"less rigid and
more liberal'" approach to standing when necessary to ensure that an issue of
substantial public importance does not escape review. Grant County, 150 Wn.2d
at 803 (quoting Wash. Nat. Gas Co. v. Pub. Util. Dist. No. 1 of Snohomish County,
77 Wn.2d 94, 96, 459 P.2d 633 (1969)). An issue is of substantial public
importance when it "immediately affects substantial segments of the population
16 Wash. State Hous. Fin. Comm 'n v. Nat'I Homebuyers Fund, Inc., No. 96063-1
and its outcome will have a direct bearing on the commerce, finance, labor,
industry or agriculture generally." Wash. Nat. Gas, 77 Wn. 2d at 96.
We have used this approach to find standing when it was unclear whether a
party had satisfied our standard two part test. For example, in Constantine, the city
challenged the constitutionality of a statute that exempted certain tribal lands from
property tax so long as the tribes negotiated a payment to the city in lieu of taxes
for public services provided to the property. 187 Wn.2d at 291-92. Applying our
two part standing test, it was clear that the city had suffered injury from the loss of
tax property revenue, but it was "a closer call whether the city's interests [were]
within the zone of interests regulated by the challenged statute." Id. at 296. We
resolved the "close call" in favor of finding standing because the question of
whether payments in lieu of taxes were constitutional would impact Indian tribes
across the state and would have implications for our tax system in general. Id. at
297; see also Wash. Nat. Gas, 11 Wn.2d at 96 ("uncertain and nebulous" injury
combined with public importance of issue sufficient for standing).
We have already determined that the Commission has standing to bring this
lawsuit pursuant to our standard test. But even if the Commission had fallen short
of the requirements for either the zone of interests or injury in fact prongs of the
test, the public importance of the issues raised would militate in favor of finding
17 Wash. State Hons. Fin. Comm 'n v. Nat'I Homebiiyers Fund, Inc.,No. 96063-1
"Decent housing for the people of our state is a most important public
concern." RCW 43.180.010. When the Commission was established, "a
significant portion of the state's population was inadequately housed." Wash. State
Hons. Fin. Comm'n v, O'Brien, 100 Wn.2d 491, 496, 671 P.2d 247 (1983). A lack
of affordable housing threatened a "downward spiral effect on the state's
economy," and it was apparent that the private sector had been unable to correct
the housing scarcity. Id. at 493. In response, the legislature created the
Commission to perform a "recognized governmental function" to help make
affordable housing available to more people throughout the state. RCW
43.180.010. As discussed above, the Commission is self funded and relies on the
revenue it generates from participating in the FHA mortgage insurance program.
Thus, impermissible interference with the Commission's ability to generate
revenue through the mortgage insurance program would implicate the affordable
housing and economic concerns the Commission was created to address. Had we
found that either the zone of interests or the injury in fact question was a "close
call," we still would have found that the Commission has standing due to the
public importance of the issues in this case.
We hold that the Commission has standing pursuant to the UDJA. The
Commission's asserted interest against unauthorized competition is within the zone
18 Wash. State Hons. Fin. Comm 'n v. Nat'l Homebuyers Fund, /«c., No. 96063-1
of interests of chapter 43.180 RCW, and the Commission has shown injury in fact
related to that interest. Whether NHF's activities in Washington are of the type
that would require authorization from the legislature is a separate question that
goes to the merits of the Commission's claim. We express no opinion on that issue.
We therefore reverse and remand to the Court of Appeals for consideration of the
remaining issues on appeal. RAP 13.7(b).
19 Wash. State Hons. Fin. Comm'n v. Nat'I Homebuyers Fund, Inc., No. 96063-1
20 Wash. State Hous. Fin. Comm 'n v. Nat'I Homebiiyers Fund, Inc.
OWENS, J. (dissenting) — The Washington State Housing Finance
Commission (Commission) sought a declaratory judgment and injunction against the
National Homebuyers Fund (NHF) barring NHF from continuing to provide down
payment assistance in Washington. The Commission claims that it has standing under
the Uniform Declaratory Judgments Act (UDJA), chapter 7.24 RCW, arguing that its
interest in prohibiting NHF from engaging in such activities in Washington is within
the zone of interests regulated by the Commission's enabling act, chapter 43.180
RCW. I disagree. Because chapter 43.180 RCW does not exclude other entities,
governmental or otherwise, from providing down payment assistance in Washington,
and because the Commission's interest in so excluding is not one of substantial public
importance, I would hold that the Commission fails to establish standing.
To establish standing, the Commission must demonstrate, in part, that the
interest it seeks to protect is '"arguably within the zone of interests to be protected or
regulated by the statute.'" Grant County Fire Prat. Dist. No. 5 v. City of Moses Lake, Wash. State Hons. Fin. Comm 'n v. Nat'l Homebuyers Fund, Inc., No. 96063-1 Owens, J., Dissenting
150 Wn.2d 791, 802, 83 P.3d 419 (2004) (internal quotation marks omitted) (quoting
Save a Valuable Env'tv. City ofBothell, 89 Wn.2d 862, 866, 576 P.2d 401 (1978)).
However, the majority's general proposition that all state-authorized entities are
entitled to a presumption of standing as against all entities not expressly authorized is
inaccurate and overbroad. This case is distinguishable fr om Day v. Inland Empire
Optical, Inc., 76 Wn.2d 407, 456 P.2d 1011 (1969), and Puget Sound Traction, Light
& Power Co. v. Grassmeyer, 102 Wash. 482, 173 P. 504 (1918), on which the
majority relies. In both of those cases, the conduct at issue was expressly declared
unlawful by positive laws (a state statute and a municipal ordinance, respectively).
The interests that the plaintiffs in Day and Grassmeyer sought to protect were thus
clearly within the zones of interests regulated by those laws.
Here, in contrast, chapter 43.180 RCW does not expressly declare it unlawful
for entities other than the Commission to provide down payment assistance. The
Commission argues that chapter 43.180 RCW implicitly prohibits other entities from
doing so under the color of governmental authority. However, the plain language of
RCW 43.180.010—which states that the Commission was established in order to
"make additional funds available . . . to help provide housing throughout the state"—
implies that the Commission's role is intended to be supplemental rather than
exclusive. (Emphasis added.) In fact, the Commission identified in an interrogatory
more than 25 entities aside from itself that provide down payment assistance in Wash. State Hons. Fin. Comm 'n v. Nat'I Homebuyers Fund, Inc.,No. 96063-1 Owens, J., Dissenting
Washington, including numerous municipalities and govermnent agencies.
Furthermore, chapter 43.180 RCW contains no provision protecting the
Commission's geographic territory. Unlike Alderwood Water District v. Pope &
Talbot, Inc., 62 Wn.2d 319, 382 P.2d 639 (1963), and Skagit County Public Hospital
District No. 304 v. Skagit County Public Hospital District No. 1, 111 Wn.2d 718, 305
P.3d 1079 (2013), here, chapter 43.180 RCW does not prohibit other entities from
participating in an activity within a specified territory.
While Alderwood and Skagit County reference a "general rule" against
municipal corporations performing "the same functions at the same time in the same
territory," Skagit County, 177 Wn.2d at 726; Alderwood, 62 Wn.2d at 321, this court
aclmowledged in Alderwood that "this so-called general rule has been virtually
emasculated by the case law of this state." 62 Wn.2d at 321. Nonetheless, insofar as
the general rule "continues to serve as a touchstone in the sense that it expresses a
public policy against duplication of public functions, . . . [it] should alert courts . . . to
the necessity of closely examining in toto statutory provisions conferring authority
upon the potentially competing municipal corporations." Id.
Examining closely the statute conferring authority upon the Commission as an
"instrumentality of the state," there is no plain indication that the legislature intended
the Commission to be the sole governmental entity that may offer down payment
assistance in Washington. RCW 43.180.040(1). Rather, the Commission exists to Wash. State Hons. Fin. Comm 'n v. Nat'l Homehuyers Fund, 7«c., No. 96063-1 Owens, J., Dissenting
augment funding for state residents who could not otherwise afford to buy homes.
Ostensibly, more funding, rather than less, would better achieve that goal.'
Viewing chapter 43.180 ROW in toto, I conclude that it does not contemplate
the exclusion of other governmental entities that seek to give money to low-income
prospective homeowners. As such, I would hold that the Commission cannot
establish standing because excluding NHF fr om providing down payment assistance is
not '"within the zone of interests to be protected or regulated by the statute.'" Grant
County, 150 Wn.2d at 802 (internal quotation marks omitted) (quoting Save a
Valuable Env't, 89 Wn.2d at 866).
I further disagree that the instant issue is of sufficient public importance to
militate in favor of standing despite that the Commission's interests fall outside the
chapter 43.180 RCW's zone of interests. See Grant County, 150 Wn.2d at 803. The
fact that "[d]ecent housing for the people of our state is a most important public
concern" does not, as a matter of course, render the permissibility of NHF providing
down payment assistance in Washington an issue of substantial importance. RCW
43.180.010. Rather, the Commission's pursuit of a declaratory judgment that NHF
lacks authority to provide such assistance presents a narrow issue of the alleged
' See Skagit County, 177 Wn.2d at 738 (Madsen, C.J., dissenting) (noting that the majority's holding that one rural public hospital district may not operate within the territory of another "is contrary to this legislative intent because it has the potential to diminish rather than enhance rural patients' access to health care services"). 4 Wash. State Hous. Fin. Comm'n v, Nat'I Homebuyers Fund, Inc., No. 96063-1 Owens, J., Dissenting
preemptive effect of a state law, chapter 43.180 RCW, on a nonstate actor. Housing is
involved only by implication. As in Grant County, where this court held that two fire
districts did not have standing when the "only interest sought to be protected . . . [was]
protection of their tax base," here, the Commission seeks to protect its revenue base
by excluding NHF from the federally insured mortgage securities market in
Washington. 150 Wn.2d at 804.
In sum, I would hold that the Commission's claim is not within the zone of the
interests protected by chapter 43.180 RCW, nor does it present an issue of substantial
public importance. Thus, the Commission failed to establish standing under the
UDJA. I respectfully dissent. Wash. State Hous. Fin. Comm'n v. Nat'I Homebuyers Fund, Inc.,No. 96063-1 Owens, J., Dissenting