Port Orchard staff recommend per-bedroom park impact fee, set public hearing for March 11

City staff presented proposed changes to Port Orchard's park impact fee structure during a Feb. work study session and recommended a per-bedroom fee method to comply with recent state legislation that requires lower proportional fees for smaller housing units and places limits on accessory-dwelling-unit (ADU) charges.

Project manager Mr. Bond told the City Council the Legislature passed two bills that affect local impact-fee practice: one (identified in the presentation as Senate Bill 5258) requires jurisdictions to adopt a rate structure that proportionately lowers fees for smaller housing units using either square footage, bedrooms, or trip generation; a separate provision limits impact fees on an ADU to no more than 50% of the fee that would be charged on the primary unit. "This bill set out that by June thirtieth of 2025, all jurisdictions that charge impact fees shall charge it using a rate structure that proportionately lowers the fees for smaller housing units," Bond said.

Bond presented two implementation options: (1) a per-square-foot rate, and (2) a per-bedroom rate. He reviewed historic building data and recommended a four-year average approach for whichever metric the council adopts. Under staff's recommended per-bedroom approach (using the four-year average), the proposed park impact fee would be $1,616.73 per bedroom. Bond said the per-bedroom approach reduces administrative ambiguity because bedrooms are defined in model building codes (IRC/IBC) and are easier for permitting staff to verify than finished square footage.

The per-square-foot alternative, Bond said, produced a wider range of winners and losers: it would give deeper discounts to many middle-housing types and apartments while increasing fees for some large single-family homes. He noted implementation challenges for the square-foot option, including the need to adopt a consistent policy on whether to include garages or other unconditioned spaces in the square-foot calculation.

Bond told the council he had prepared draft code language to implement the ADU cap and that the city attorney had reviewed the proposed language. He also said the school district is preparing its own impact-fee analysis and may adopt a different metric; the council will consider the school district's proposal when it is submitted.

The Finance Committee earlier in the evening reviewed the options and supported the staff recommendation for the per-bedroom approach. Bond proposed a public hearing on March 11, with action to follow; he recommended an effective date of July 1, 2025, which is the statutory deadline cited in his presentation. Bond said builders and the Home Builders Association had been consulted; he expected the association to submit comments and noted it may prefer the square-foot option.

Councilors asked several clarifying questions about revenue predictability, developer responses, and whether the proposed change would affect incentives for middle-housing or ADU construction. Multiple council members expressed support for the per-bedroom approach on equity grounds and for ease of administration. Bond said the fee schedule would be revisited as part of the city's next park-plan and rate study (required for state grant eligibility) in about three years.

No final ordinance was adopted at the work session. The council set a public hearing for the March 11 council meeting; staff said the council could vote following the hearing or continue the item if testimony prompted further review.