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Commissioners discuss impact-fee waiver options to spur affordable housing; staff to return with fiscal examples
Summary
Senior planner presented RCW authority allowing partial (up to 80%) or full waivers of impact fees for low‑income housing but noted 100% waivers require public backfill of the remaining 20% from non-impact-fee funds. Commissioners requested fiscal pro-formas and jurisdictional examples; staff will return next month with analysis.
The Planning Commission discussed possible impact-fee waivers for affordable housing on May 4 after a staff presentation outlining state law options, practical tradeoffs and next steps. No formal policy decision was made; staff will return with examples and financial estimates.
Staff (senior planner) reviewed RCW 82.02.060 and explained two statutory options for exemptions: a partial exemption of up to 80%—which the statute does not explicitly require to be paid back from public funds—and a full waiver, which requires the city to pay the remaining 20% of foregone fees from public funds other than impact-fee accounts. Staff emphasized that waivers can increase project feasibility but are typically most effective when packaged with broader affordable‑housing incentives.
Commissioners raised operational and fiscal questions. One commissioner asked where backfill funds would come from; staff suggested the general fund or a designated account and said the city would consult finance staff and partner agencies (for example, school districts for school fees). Commissioners asked whether state grant programs or other public funding sources could be used to backfill foregone fees; staff said some grants may be eligible but cautioned that not all grant programs permit that use.
Commissioners also requested an estimate of likely annual foregone-fee amounts. Staff said it is difficult to predict because few capital-affordable projects have been built recently in Fife; the primary local example is the Pierce County Housing Authority’s Chateau Rainer redevelopment, and Lehi Road is a candidate site for future affordable development. Staff committed to returning with jurisdictional examples, lessons learned, and site-specific pro-forma estimates (for example using city-center development scenarios).
On policy design, commissioners discussed whether impact-fee waivers should be tied to the development-agreement process or offered through a clearer menu or expedited covenant-based approach. Staff suggested multiple options—require a covenant documenting long-term affordability, offer a points-based incentive menu, or create an abridged development-agreement track for affordability projects—and agreed to incorporate feedback into next month’s materials.
Next steps: staff will compile examples from other jurisdictions, prepare fiscal hypotheticals and pro-formas for commissioner review, and present recommended code language or options at a subsequent meeting.
