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State bills would ease conversions of existing buildings to housing; planner flags density bonus and review limits
Summary
Hans Sheppard briefed the Planning Commission that state bills allow up to a 50% density increase for residential conversions within existing building envelopes, limit change-of-use permits, and restrict some local review triggers; staff will return with code language, maps of pedestrian corridors, and coordination with public works on utilities.
Senior community planner Hans Sheppard told the Commission that three state bills affecting conversion of existing buildings into housing will require Lacey to examine multiple code chapters.
Sheppard described House Bill 1042 as allowing a 50% density increase when new housing is constructed entirely within an existing building envelope. He said that bonus is measured against existing maximums (for example, a low-density zoning maximum of six units per acre could be increased by 50% where the conversion stays within the envelope). Sheppard emphasized the bill applies to existing buildings and is not creating new building footprints.
House Bill 1757 (which Sheppard characterized as a catchall) appears to prohibit local governments from requiring a formal change-of-use permit for conversions from commercial to residential, shifting review into other permit paths. Sheppard said that construction permits and other development permits remain pathways for the city to ensure dwelling standards are met, so the change removes a separate procedural trigger but does not eliminate building and safety inspections.
House Bill 1183 addresses energy-efficient and affordable housing and places limits on requiring certain building treatments—setbacks, façade modulation, and off-street parking—in projects that meet defined energy-efficiency criteria (for example, passive-house or modular construction). Sheppard said the city will need to align local definitions with the state code, add definitions for passive house and mass timber, and decide where character-defining streetscapes or major pedestrian corridors will qualify for tailored treatments.
Commissioners asked about utility capacity (water and sewer) tied to density increases; Sheppard said staff are coordinating with public works on basin-level capacity forecasts and cited past conversions that required increased sewer outlet capacity. He said staff will prepare maps and proposed code language and will return for public review before the Commission makes a recommendation to council.
