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Lacey planners outline state mandates on middle housing, ADUs, co‑living and unit‑lot subdivisions
Summary
City staff briefed council on new state housing mandates: plan for housing at all income bands under HB 1220; adopt middle‑housing ordinances and ADU allowances; enable unit‑lot subdivisions and implement co‑living rules. Staff will return with code language and racially disparate impact analysis results.
At the Feb. 11 work session, planning staff outlined state mandates that will require updates to Lacey's housing element and municipal code, including planning for housing across income bands, implementing middle‑housing ordinances and expanding accessory‑dwelling‑unit (ADU) allowances.
Staff explained that House Bill 1220 requires jurisdictions to plan for housing across all income bands and to assess racially disparate impacts and displacement risks. The city contracted Uncommon Bridges to prepare a racially disparate‑impacts analysis; staff said the final report is expected soon and will inform policy choices.
Staff summarized middle‑housing requirements under state law (House Bills 1110 and 2321 as discussed in the presentation). For Tier‑2 cities such as Lacey, ordinances must allow specified types of middle housing; the presenter said the city must adopt an ordinance by June 2026 to allow at least two middle‑housing units per lot in many residential zones, with incentives to allow up to four units when at least one is made affordable.
House Bill 1337 (as presented) expands ADU allowances to permit two ADUs per lot in urban growth areas where lot and sanitary constraints permit. Staff noted septic or sewer capacity can limit ADU construction; the Thurston County environmental code sizes septic systems by bedrooms and may prevent additional dwellings where capacity is lacking.
Staff also discussed co‑living (micro‑units with shared kitchens) and unit‑lot subdivisions (unit lots sold individually while shared space remains common), both of which have specific state requirements and deadlines. The presenter said co‑living requirements must be implemented by the end of 2025 and unit‑lot subdivision procedures must be included with short‑plat regulations.
Staff said they will bring middle‑housing survey results to the Planning Commission, prepare draft ordinance language for June submissions to the Department of Commerce where required, and continue public and stakeholder engagement. Staff emphasized that many implementation details (design standards, parking requirements and sanitary feasibility) will be handled in subsequent code amendments.
