Housing coordinator Jennifer Adams unveils draft infill chapter to allow up to four units per lot

Housing coordinator Jennifer Adams presented a first briefing to the Lacey Planning Commission on March 11 on a draft infill residential development chapter designed to implement recent state laws on middle housing and accessory dwelling units.

Adams told the commission that the draft consolidates middle-housing and ADU provisions into a single chapter and adopts a "unit-as-unit" approach that counts total dwelling units per lot rather than relying only on units-per-acre calculations. "This middle housing structure introduces this new concept of we are now talking about units per lot," Adams said.

Key proposals explained by staff include allowing up to three market-rate units per eligible lot and permitting a fourth unit if the developer provides affordable housing as required under the state's middle-housing framework for tier-2 cities. Adams said the staff proposal ties the fourth-unit bonus to an affordability covenant at 80% of area median income (AMI) recorded for 50 years.

The draft also treats ADUs as additional dwelling units rather than strictly accessory structures and proposes a 1,000-square-foot cap for habitable ADU space. "We landed at 1,000 square feet of habitable space," Adams said, reflecting the state-mandated minimum in the ADU update.

Commission discussion focused on practical constraints and design standards. Commissioners and staff debated whether the city should retain a reduced 5-foot rear setback used in the preapproved ADU program or revert to a more protective 15-foot rear setback; staff recommended 15 feet given the potential for higher density and to remove subjective code language the state prohibits. Commissioners also raised questions about utilities, emergency access, tree protections, HOA covenants, and the parking implications of increased density. Staff said state law limits cities' authority on parking and that generally the city cannot require more than one off-street parking stall per unit.

On affordability compliance, Adams said the draft requires a recorded covenant approved by the city before building permits are issued. "It would be something that falls to the developer," staff said; commissioners asked how the city will track long-term compliance and staff said implementation details remain to be worked out.

Adams said a GIS exercise found only about 3,000 parcels in the city that initially meet simple size-and-sewer proximity criteria, underscoring that not every neighborhood will be affected. Staff will return to the commission in two weeks with additional design-code language; staff also outlined a schedule that includes an April open house, a public-review draft in May—6 and a possible public hearing in July.