North Bend planning commission backs residential impact fee updates, asks council to study hotel park fee

The North Bend Planning Commission on the evening of the meeting reviewed proposed amendments to the city’s impact-fee regulations and voted to forward the changes to city council, while also asking the council to study whether hotels should continue to pay park impact fees.

The commission’s review focused on code changes prepared by city staff to comply with recent state legislation and to scale residential impact fees “according to either building size, trips generated, or number of bedrooms,” City Associate Planner Caitlin Hepworth said during her presentation. “We are bound by a June 30 deadline” to revise residential impact-fee methodology to conform with state law, Hepworth said, referring to state action cited in the staff report.

The amendments in the packet implement the consultant FCS Group’s recommendations for scaling fees and adjust multiple chapters of the North Bend Municipal Code that govern park, transportation and pedestrian/bicycle impact fees. Key changes recommended to the council include: an 80% discount on park “parking pack” fees for qualifying affordable rental and ownership housing; a new, smaller 20% discount category for units the staff describes as “workforce housing;” explicit treatment of accessory dwelling units (ADUs) that keeps ADUs within the same ownership eligible for a credit, and requires payment of impact fees when an ADU is converted to a condominium and sold as a separate unit.

Developers representing the proposed Wyndham Hotel in North Bend urged the commission to reconsider how the park fee applies to hotels. Evan Mann, representing Eastside Investment Group and the Wyndham project, said the current park impact fee applied to hotels — $2,716 per room in the staff packet — is “a bit excessive and more importantly not substantiated by clear evidence of impact.” Mann said his firm’s preliminary estimate of the charge for their project exceeded $334,000 and noted the developer plans roughly $160,000 in public-facing improvements along Bendigo Boulevard. “We respectfully ask this commission to make a formal recommendation…to exempt hotels from the park impact fee or at a minimum ask staff to reevaluate and justify the basis for this charge with localized usage data,” Mann said.

Jeff Fazen, also with Eastside Investment Group, told the commission the developer wants to be a “great partner” with the city but is concerned about the fee’s economic effect on the project.

Commissioners said they heard both sides. Some commissioners urged caution about creating development barriers; others said existing local park use data appeared dated and recommended further study of how transient visitors use parks. One commissioner noted that other nearby jurisdictions take different approaches to hotels in impact-fee schedules and offered to gather comparative data for King County cities.

On ADUs, staff told the commission the intent is to allow credits for ADUs that remain under single ownership (for example, family members living together) and to require payment of impact fees when ownership becomes separate through condominiumization and sale. Hepworth explained that transportation-impact fees were not being exempted in the same way as parks but that exemptions or reductions could be negotiated in development agreements where public benefit is demonstrated.

The commission made a motion to forward the residential impact-fee amendments for council consideration and to request that council/staff pursue additional study of park-impact fees for hotels and commercial uses. The motion text, recorded in the meeting transcript, asked staff to transmit the proposed amendments to North Bend Municipal Code chapters covering impact fees (referenced in the motion as N.B.M.C. 17.36, 17.38 and 17.42) and to recommend that the council consider investing resources to study hotel impacts and the regional treatment of hotel park fees. The transcript does not include a recorded roll-call vote on that motion in the excerpt provided.

Commissioners and staff noted several technical clarifications needed in the code language and the packet maps (staff committed to add clearer legends and definitions such as “small” versus “large” industrial buildings where modulation standards refer to those terms). Staff also confirmed the city’s transportation trip rates are drawn from the Institute of Transportation Engineers trip-generation methodology and that impact fees are intended to assign a proportional share of costs for new development’s impacts on public facilities.

What happens next: the commission forwarded the amendments and the commission’s request for a study of hotel park fees to the city council for final action. Council will receive the commission’s recommendation and the staff report; staff said they plan separate outreach and a later update on commercial impact fees. The meeting transcript notes the commission’s recommendation and the request for additional study but does not record a final city-council decision within the provided excerpt.

Community members, city staff and developers can expect the council review to include the staff impact-fee study by FCS Group, the commission’s recommendations, the developer letters submitted to the commission and any additional comparative data the commission requested about hotel treatment in neighboring jurisdictions.