PORT ORCHARD — Kitsap Community Resources has agreed to pay back a $1.5 million cash advance the county gave it during the COVID-19 pandemic, under a repayment schedule that runs through August 2031 and is backed by a confession of judgment.
The Kitsap County Board of Commissioners is scheduled to affirm the agreement on its consent agenda Monday, Nov. 9. County staff say commissioners already signed the contract Oct. 18; Monday’s vote would ratify it in open session.
How the money was supposed to work
The county gave the $1.5 million to Kitsap Community Resources, the county’s community action agency, through a 2021 contract so the nonprofit could keep up with rental-assistance payments during the pandemic, according to the staff summary. The money was a restricted “cash-flow milestone advance,” meant to be held in a dedicated account and returned in full to the county, according to the repayment agreement.
“The Milestone Payment was not returned to the County upon the expiration of the original cash-flow management period,” the agreement states.
The agreement says the advance came from county affordable-housing surcharges on recorded documents, collected under state law and held in the county’s Fund 1131 recording-fee balances. Repayments go back to the county’s housing fund.
The repayment terms
Under the agreement:
- Kitsap Community Resources acknowledges owing the full $1.5 million and has already paid $300,000, which the county received by June 29, 2026.
- The remaining $1.2 million is due in 60 monthly payments of $20,000, from September 2026 through Aug. 31, 2031.
- Interest of 12% a year accrues on the unpaid balance but is waived as long as the agency pays on time. If it defaults and doesn’t fix the problem, the waiver ends and interest applies retroactively to the whole remaining balance.
- The agency signed a confession of judgment, which the county holds and won’t file unless the agency defaults. The county can also withhold money it owes Kitsap Community Resources under other contracts after notice and a 10-business-day chance to fix a default.
- The agency agreed to treat the repayment as a priority over its other unsecured creditors, “to the extent KCR is able to do so consistent with its other legal and contractual commitments.”
The agreement describes the deal as a negotiated compromise: the county agreed not to demand immediate full repayment and to waive interest, and Kitsap Community Resources agreed to the confession of judgment and withholding rights.
The packet does not say why the advance was not returned on time. Nothing in the packet indicates the agency has missed a payment under the new schedule.
Kitsap Community Resources runs rental assistance, energy assistance, Head Start and other anti-poverty programs across the county. It also appears elsewhere on Monday’s agenda: commissioners are set to approve $392,000 in 2027 behavioral-health sales tax money for its R.O.A.S.T. rental-assistance program.
Commissioners meet at 5:30 p.m. Monday, Nov. 9, in the Commissioners Chambers of the Kitsap County Administration Building, 619 Division St., Port Orchard. The meeting can be joined on Zoom at us02web.zoom.us/j/81761133877 or by phone at 253-215-8782 (webinar ID 817 6113 3877). Public comment on business and consent items is taken near the start of the meeting, two minutes per person, and written comments can be submitted to the board.
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