Issaquah committee backs drafting ordinance to offer 80% or 100% impact-fee waivers for early learning centers

The Issaquah Planning, Development & Environment Committee on Feb. 3 directed city staff to prepare ordinance language that would allow applicants to choose either an 80% traffic-impact fee waiver or a 100% waiver conditioned on a covenant requiring 25% of enrolled families to qualify for state-subsidized child care.

Planning manager Kristen Leeson presented the ordinance options for early learning facilities, telling the committee traffic-impact fees can be a substantial upfront barrier to child-care development. She presented sample assessments showing traffic fees dwarf park and fire fees: one recent daycare’s traffic fee was about $120,000 compared with roughly $2,200 in park fees and $410 in fire fees; a larger proposed facility’s traffic fees were estimated near $380,000, with parks about $2,300 and fire just over $11,000.

“Traffic impact fees are significantly more than the fire and park fees that are charged toward developments,” Leeson said, summarizing staff analysis and recommending an 80% traffic-impact exemption as the administration’s preferred, simple approach.

Two project proponents urged fuller relief. “Childcare centers cannot absorb costs like this — that is the remaining impact fees assessment after making change-of-use adjustments,” said Virender Mann, who described converting an unused office into a preschool. He told the committee the balance remaining was about $400,000 and asked the city to view childcare as social infrastructure rather than a standard commercial development.

Mahesh Rapaka, the applicant and a childcare operator, said his proposed center would focus on infants, toddlers and low-income families and create stable jobs for “more than 20 local families.” Rapaka said the $400,000 fee burden would push costs into tuition and limit below-market slots; he asked the council to grant a full 100% reduction.

Committee members probed implementation details, asking whether state or city entities would monitor the affordability covenant and what would happen if a facility converted to another use. Leeson said the Department of Children, Youth and Families (DCYF) monitors subsidy eligibility and that the city would need to build a program to collect fees if a facility fell out of compliance and owed a payback. She said finance and legal details about collection and monitoring would be refined during ordinance drafting.

Council members also discussed whether other Eastside cities offer similar waivers. Leeson cited local policies: Des Moines (50%), Blaine and Tacoma (80%) and Shoreline (100%).

On balance the committee supported having both options available: an 80% waiver for general use and a 100% waiver that requires the 25% affordability covenant and attendant monitoring. Council member Nichols said offering both gives applicants choice and could “incentivize affordable child care where businesses are willing to take on that commitment.” Council member Martz and others emphasized caution about removing all financial responsibility for infrastructure, but ultimately supported moving both options forward for full council consideration.

The committee asked the administration to revise ordinance language to include both an 80% and a 100% waiver (with monitoring and covenant requirements for the 100% option) and to return the item to the full council for regular business on March 2, 2026. Staff noted additional ordinance edits will be necessary to spell out tracking, financial collection and whether applicants may opt between the two options.

Next steps: staff will draft ordinance language, clarify monitoring and collection logistics with finance and return the revised ordinance to full council on March 2 for further consideration.