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Leavenworth pivots from inclusionary zoning to housing impact (nexus) study after no RFP bids
Summary
City staff and elected members agreed to reconfigure a failed $50,000 RFP into a narrower housing impact (nexus) study after consultants declined to bid on the combined feasibility/nexus scope. Councilmembers asked staff to check with legal and consultants on a revised scope and budget before reissuing the RFP.
Leavenworth staff told the joint meeting July 2 that an RFP issued in April to study inclusionary zoning'a combined feasibility and nexus (impact-fee) study with a $50,000 budget'received no proposals. "I did reach out, and I heard from one of the consultants that'the $50,000 that was budgeted was not enough to cover them," staff said.
Council members and commissioners then debated whether to do a feasibility study first (to test whether a mandatory inclusionary requirement would work in Leavenworth) or to commission only a nexus study that legally ties any fee to the development's impact on housing needs. As a staff member explained, a nexus study "has to tie what that fee would be to the impact that it has on the housing market" and typically yields "a range of an appropriate fee and how it is charged, like, per unit, per square foot." The city attorney noted nexus studies often require more legal review, increasing cost.
Several council members favored narrowing the scope to a housing impact (nexus) study and repurposing the budget toward that narrower RFP. "Let us use that budget amount just for a nexus study and see if we might be able to get that," one council member said. Staff said they would: "double check with legal and make sure that I'm moving in the right path there, redraft the RFP, and check with other consultants" about whether the reduced scope would attract bids.
The group discussed policy options the nexus study could support, including: a per-permit fee, a per-square-foot or per-unit charge, or an excise/impact fee model; exemptions or credits for deed-restricted long-term housing; whether ADUs should be treated differently; and legal risk tied to fees affecting second-home owners. Members emphasized that a nexus study must document proportionality and the legal basis for any fee in order to withstand review.
Staff will rework the RFP to focus on a nexus (housing impact) study, consult the city attorney on legal framing, and report back with a revised scope and budget estimate.
