Urban3 analysis shows higher tax productivity for mixed‑use development; Lynnwood officials weigh annexation and policy tools

A consultant analysis used by Snohomish County and presented to the Lynnwood City Council on Wednesday shows property tax revenue per acre is far higher for compact, mixed‑use parcels than for low‑density single‑family land — a framing the consultant calls the difference between "miles per tank" and "miles per gallon." Officials said the tool can help the city target annexation, transit‑oriented change and infrastructure investment.

Chris Collier, who presented the Urban3 work for the county alliance, described the analysis as an attempt to measure how much tax revenue each acre produces rather than raw totals. "When you divide value by the acreage that it sits on, you come out far ahead" with smaller commercial parcels and mixed‑use parcels, Collier said, showing maps that re‑ranked county parcels when measured per acre rather than in total assessed value.

The presentation displayed 2021 parcel data for Snohomish County and Lynnwood’s urban growth area and showed examples: some small commercial parcels and mixed‑use downtown parcels produced much higher taxable value per acre than large single‑use campus parcels. The presenters said the tool can be updated and used for subarea planning — for example, to model how parcels around a future light‑rail station might change value if the city encourages different uses.

Collier and Community Planning Manager Carl Omgren said the maps point to tradeoffs and to policy levers: annexation choices, the city’s Unified Development Code and incentives such as Multifamily Tax Exemption (MFTE) programs can change future tax productivity. Omgren noted the city’s recent UDC updates implementing "middle housing" will change value over time; Collier added an example showing how a quarter‑mile area near a future transit stop could increase tax value per acre if denser, mixed uses replace lower‑productivity parcels.

Council members pressed for local context and asked for follow‑up. Council member Decker challenged nationwide slides that compared county and city per‑acre figures, saying the aggregated national numbers were difficult to reconcile with Lynnwood’s local property‑tax experience. Collier and staff said the specific Urban3 county maps and Lynnwood parcel breakdowns remain the best local evidence and that the county data and maps are available for staff and council analysis.

Several council members also asked for targeted studies the city could use for local decisions — for example, modeling the tax outcome from redevelopment of a particular strip mall or the North Line Village site. Collier and Carl Omgren said similar subarea analyses exist in the Urban3 decks and promised staff would work with the presenter to model specific parcels and to update the data.

Council and staff also discussed the city’s MFTE program and development agreements. Collier and Omgren said that in some modeled cases a tax‑exempt multifamily parcel can become a net positive to the city over a longer period once construction and leasing replace lower‑value surface parking — one Urban3 example showed a crossover in tax revenues after roughly a decade for certain exemptions. Omgren said staff is reviewing the city’s MFTE rules in light of recent state changes and recent local development activity.

Ending: Council members asked for follow‑up subarea analyses (including for North Line Village and city‑owned parcels) and asked staff to return with updated parcel data and, where possible, sales‑tax layering to complement property‑tax analysis. Collier and staff said the Urban3 maps are available to staff and can be updated on request.