Kenmore commission adopts inclusionary zoning framework for 4+ unit developments, removes unit‑size exemption

The Kenmore Planning Commission voted April 1 to make inclusionary housing requirements apply to residential developments that create four or more new dwelling units and to remove a proposed exemption based on unit square footage. Commissioners also approved an annual CPI adjustment to the in‑lieu fee and a review of the fee methodology at least every two years.

The 4–3 vote sends the draft inclusionary language to public hearing with the commission’s direction that projects with fewer than four units remain exempt but that there be no square‑footage exemption (the staff draft had presented options to exempt smaller units). The commission separately approved, by unanimous vote, a motion to use the consulting analysis’ recommended CPI adjustment annually and to require a fuller market reanalysis no more frequently than every two years.

Consultants from Arch presented background, comparative examples from neighboring jurisdictions and a prototypical financial model. Arch’s modeling showed that, under Kenmore market assumptions, projects need to achieve about four units on a prototype site before there is consistent residual land value that can be captured for an affordable housing requirement. That analysis informed the commission’s choice to apply the requirement starting at four units, while exempting one‑ to three‑unit projects to avoid discouraging smaller builders or owner‑builders.

Under the draft the commission approved for public hearing, developers could provide required affordable units on‑site when projects reach thresholds (on‑site units would be required for projects of 10 or more units), or pay a fee in lieu on smaller projects; Arch’s initial fee estimate for Kenmore was about $6 per square foot using the selected method. The draft sets income targets for on‑site units at 80 percent of area median income (AMI) for owner‑occupied units and 60 percent of AMI for renter units; the draft also included a vesting cutoff so applications deemed complete by Dec. 31, 2025, would remain subject to the current adopted code.

Commissioners debated the equity and market tradeoffs of size‑based exemptions, fee timing and whether to base fees on sales price rather than square footage. Vice Chair Thompson and several commissioners said a square‑foot exemption would shrink the policy’s effectiveness and reduce revenue available for deeper‑affordability programs; other commissioners urged caution so the code would not discourage smaller infill projects or owner‑builders. After discussion, the commission removed the square‑foot exemption and kept the policy’s unit‑count threshold and vesting provisions.

The commission voted unanimously to send the revised code language, with its amendments, to staff for a public hearing. Staff said they will post the public‑hearing notice, update the draft to reflect the commission’s edits and return the ordinance to the commission with a staff report summarizing public comments and any additional technical clarifications requested by the commission.