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2020-11-04 Planning Commission PacketCommissioners City Staff Lawson Bronson, Chair Tom Medhurst, Vice-Chair Robert “Doc” Hansen, Principal Planning Wayne Carlson Hope Elder E. Tina Piety, Administrative Assistant Diana Noble-Gulliford Tim O’Neil 253-835-2601 Dale Couture, Alternate Eric Olsen, Alternate www.cityoffederalway.com K:\PLN Planning Commission\2020\Agenda\Agenda 11-04-20.doc City of Federal Way PLANNING COMMISSION November 4, 2020, 6:30 p.m. City Hall, Zoom Meeting AGENDA Notice: Pursuant to Governor Inslee’s Proclamation 20-28, all in-person meetings are prohibited until further notice. The Mayor and City Council are providing opportunities for public comment by submitting written comment or calling into the meeting to provide oral testimony. To access these options please use the following: DOWNLOAD THE DOCUMENT TO ACCESS THE LINKS. Click here for a form to sign-up to give citizen comment during the meeting (via telephone, number below) / you will be given access during the public testimony portion (we request you sign up at least 2 hours before the meeting starts). Click Here to submit written comments to the Planning Commission (we request you submit them at least 2 hours before the meeting starts); please reference “Planning Commission Meeting – November 4th Please click the link below to join the webinar: https://cityoffederalway.zoom.us/j/92039948345?pwd=TEJnRFlOSTZZc0NlTVJGdXlRUDJXdz09 Listen to the live meeting: (888) 788-0099 or 253-215-8782 Meeting ID: 920 3994 8345 Watch from the Zoom mobile app with meeting: 920 3994 8345 and password: 431768 1. CALL TO ORDER 2. ROLL CALL 3. APPROVAL OF MINUTES a. Planning Commission Meeting of September 16, 2020 4. PUBLIC COMMENT 5. COMMISSION BUSINESS a. Public Hearing – Code Amendments to the FWRC Chapter 19.91, Transportation Impact Fee 6. STAFF BUSINESS a. Manager’s Report 7. NEXT MEETING a. November 18, 2020, 6:30 p.m. 8. ADJOURNMENT Planning Commission Meeting Minutes September 16, 2020 Planning Commission Minutes Page 1 September 16, 2020 CITY OF FEDERAL WAY PLANNING COMMISSION September 16, 2020 City Hall 6:30 p.m. Zoom MEETING MINUTES Commissioners present: Lawson Bronson, Tom Medhurst, Wayne Carlson, Diana Noble-Gulliford, Dawn Meader McCausland, Tim O’Neil, Dale Couture, and Eric Olsen. Commissioners absent: Hope Elder. City Staff present: Community Development Director Brian Davis, Planning Manager Robert “Doc” Hansen, Assistant Planner Chaney Skadsen, Assistant City Attorney Eric Rhoades, and Administrative Assistant II Tina Piety. CALL TO ORDER Chair Bronson called the meeting to order at 6:30 P.M. MINUTES An amendment to the September 2, 2020, minutes was presented to the Commission and the minutes were approved as amended. PUBLIC COMMENT None COMMISSION BUSINESS Public Hearing: FWRC Chapter 19.250, Cottage Housing Amendment – Planner Skadsen presented the staff report. Planning staff identified barriers to cottage housing and compact single-family development regulations in Title 19 of the Federal Way Revised Code (FWRC). The code currently recognizes that as many as 16 houses are feasible upon one site. The current regulations limit the number of units in a cottage housing development to 12 units, with up to 16 units allowed if the additional are affordable. The fact that 16 units can be achieved with affordable conditions, demonstrates that as many as 16 houses are feasible upon the site. The requirement to have units affordable in order to receive 16 units is often economically unachievable in meeting the maximum density allowed given the cost of building cottage housing. The proposed amendments are designed to promote higher density cottage housing and compact single-family developments, increase housing production, and meet the growing demand for diverse housing options in Federal Way. Specifically, the amendments address: • Maximum base density of cottage and compact single-family housing development; • Removal of affordability standards; and • Removal of the limitation of the number of cottage housing demonstration projects allowed in the City of Federal Way. Planning Commission Minutes Page 2 September 16, 2020 Discussion was held on the meaning of affordable. Planner Skadsen commented that the city needs housing that will meet all income levels. She encouraged Commissioners to consider the overall impact of the proposed amendment. Discussion was held on parking and the possibility of including electrical docking stations. Commissioner Meader McCausland asked why limit the number of units to 16? Planner Skadsen responded the limitation is only for Single-Family Residential zones, which have the city’s smallest lots. Commissioner O’Neil moved (and it was seconded) to recommend approval of the FWRC Chapter 19.250, Cottage Housing Amendment as presented. There was no further discussion. The vote was held and the motion passed unanimously. STAFF BUSINESS a. Manager’s Report –None. Commissioner Meader McCausland announced this is her last meeting. She thanked the City Council and Planning Commissioners for this opportunity. Commissioners stated she will be missed and wished her success in her future endeavors. NEXT MEETING October 7, 2020, 6:30 p.m., Zoom Meeting ADJOURN The meeting adjourned at 7:35 P.M. K:\Planning Commission\2016\Meeting Summary 09-16-20.doc Planning Commission Public Hearing Code Amendments to the FWRC Chapter 19.91 Transportation Impact Fee Planning Commission Staff Report October 21, 2020 Amendments to Chapter FWRC 19.91 Transportation Impact Fee Page 1 of 4 PLANNING COMMISSION PUBLIC HEARING STAFF REPORT TO: Lawson Bronson, Federal Way Planning Commission Chair FROM: Rick Perez, P.E., City Traffic Engineer Sarady Long, Senior Transportation Planning Engineer DATE: October 21, 2020 SUBJECT: Code Amendments to the FWRC Chapter 19.91, Transportation Impact Fee I. FINANCIAL IMPACTS The proposed code amendments will have no financial impacts on the city budget. II. INTRODUCTION The city implemented the Transportation Impact Fee (TIF) program on July 2010, requiring new development to pay their proportionate share of the cost of new facilities to serve new development consistent with Revised Code of Washington (RCW) 82.02. Under the impact fee program, all development projects pay the same per trip fee; thus, providing predictability for the developers. The transportation impact rate study currently in affect is based on the 2008 – 2030 capital project lists and has not been update since adoption as mandated by code. In 2015, the city conducted a major update to the city’s comprehensive plan. As part of this update, a new 2016 – 2040 capital improvement program project list was adopted. The transportation impact fee schedule will need to be amended to reflect the changes to the transportation project list. The code amendments are necessary for the city to comply with the periodic adjustment of rate as identified in Federal Way Revised Code (FWRC) 19.91.160 and to comply with RCW 82.02 pertaining to impact fee. III. PROPOSED AMENDMENTS The draft proposed code amendments are attached as Exhibit A. The proposed amendments will mainly delete reference to the February 2009 rate study and replace it with the November 2020 rate study performed by Fehr & Peers. Additionally, the amendment will incorporate language to comply with the Growth Management Act (GMA) and RCW requirements. It is proposed to amend FWRC Title 19 “Zoning and Development Code” Chapter 19.91, “Transportation Impact Fees” to include the following significant section: Planning Commission Staff Report October 21, 2020 Amendments to Chapter FWRC 19.91 Transportation Impact Fee Page 2 of 4 1. Findings and Authority, FWRC 19.91.030 – Replace the February 2009 rate study with the November 2020 rate study performed by Fehr & Peers. A new rate study is necessary to comply with code requirements under FWRC 19.91.16. 2. Definitions, FWRC 19.91.040 – Update and remove definitions or terms not used in the code. Replace “traffic” with “transportation” to be more multimodal throughout the chapter. 3. Assessment of Impact Fee, FWRC 19.91.060 – Clarify credit for change in use of an existing building or dwelling unit. 4. Optional for Deferred Payment of Transportation Impact Fee, FWRC 19.91.066 – Expand language by adding an 18 months deferment period to meet GMA requirements. Per RCW 82.02.050(3)(b), the term of this deferral may not exceed 18 months from the date of building permit issuance. 5. Independent Fee Calculations, FWRC 19.91.040 – Add language permitting a professional engineer or certified planner to prepare the fee calculation. 6. Exemptions, FWRC 19.91.080 – Delete FWRC 19.91.080(h). This exemption was applicable when the impact fee was first implemented and is no longer needed with the impact fee updates. 7. Establishment of Impact Fee Account, FWRC 19.91.110 – Update the impact fee expend period from six to ten years per the RCW. 8. Refunds, FWRC 19.91.140 – Update the impact fee expend or encumber period by the city from six to ten years per the RCW. 9. Use of Funds, FWRC 19.91.150 – Clarify that the impact fees collected can only be used for projects listed in the rate study consistent with the RCW. 10. Periodic Adjustment of Rates, FWRC 19.91.160 – The impact fee schedule is adjusted yearly to reflect increases in construction costs. The Washington State Department of Transportation Construction Cost index is no longer published by the state. The proposed yearly adjustment is now tied to the Consumer Price Index for the Seattle area consistent with other Public Works fees. 11. Administrative Fees FWRC 19.91.170 – Change the administrative fee from three to five percent consistent with the School Impact Fee and Surface and Stormwater Utility System Development Charges program. IV. TIMELINE The anticipated timeline for completion of the code amendment process is as follows: LUTC Review 11/02/2020 Planning Commission Hearing 11/04/2020 Council First Reading 11/17/2020 Council Second Reading 12/01/2020 Planning Commission Staff Report October 21, 2020 Amendments to Chapter FWRC 19.91 Transportation Impact Fee Page 3 of 4 V. PUBLIC COMMENTS No public comments have been received regarding this proposal as of October 21, 2020. Any comments received since this time will be submitted into the record for City Council review. VI. REASON FOR PLANNING COMMISSION ACTION FWRC Title 19, “Zoning and Development Code,” Chapter 19.80, “Process VI Review,” establishes a process and criteria for development regulation amendments. Consistent with Process VI review, the role of the Planning Commission is as follows: 1. To review and evaluate the proposed development regulation amendments. 2. To determine whether the proposed development regulation amendment meets the criteria provided by FWRC 19.80.130 (item VII below). 3. To forward a recommendation to City Council regarding adoption of the proposed development regulation amendment. VII. DECISIONAL CRITERIA FWRC 19.80.130 provides criteria for development regulation amendments. The following section analyzes the compliance of the proposed amendments with the criteria provided by FWRC 19.80.130. The city may amend the text of the FWRC only if it finds that: 1. The proposed amendment is consistent with the applicable provisions of the comprehensive plan. Staff Response – The proposed code amendment is consistent with the following goals and policies: TG1 Maintain mobility through a safe, balanced, and integrated transportation system. TP1.3 Identify the improvements and strategies needed to fully implement the City’s Layered Network and meet the level-of-service requirements for transportation. TP2.3 Prioritize transportation projects considering concurrency, safety, multimodal enhancements, environmental impacts, and cost effectiveness. 2. The proposed amendment bears a substantial relationship to public health, safety, or welfare. Staff Response – The proposed code amendment bears substantial relationship to public health, safety, and welfare as it seeks to ensure funding for capital projects in meeting concurrency and provide development with predictability, consistency, and fairness in assessing traffic impacts. Consistency and predictability for developers may encourage new development, bringing new jobs and providing more economic activity in the city. 3. The proposed amendment is in the best interest of the residents of the city. Staff Response – The proposed amendment is in the best interest of the residents of the city as its intent is to have new development pay a proportionate share of the cost of new facilities needed to serve new growth, ensure funding for capital projects to meet concurrency needs, and provide predictability, consistency, and fairness to the developers in assessing development impact fees. Planning Commission Staff Report October 21, 2020 Amendments to Chapter FWRC 19.91 Transportation Impact Fee Page 4 of 4 PLANNING COMMISSION ACTION The Mayor recommends adopting the proposed ordinance to amend FWRC Title 19 as shown in Exhibit A. Consistent with the provisions of FWRC 19.80.240, the Planning Commission may take the following actions regarding the proposed regulation amendments: 1. Recommend to City Council adoption of the FWRC text amendments as proposed; 2. Modify the proposed FWRC text amendments and recommend to City Council adoption of the FWRC text amendments as modified; 3. Recommend to City Council that the proposed FWRC text amendments not be adopted; or 4. Forward the proposed FWRC text amendments to City Council without a recommendation. Exhibit A: Proposed Code Amendments to FWRC Chapter 19.91 Ordinance No. 20-_____ Page 1 of 22 Rev 2/19 LU ORDINANCE NO. _________ AN ORDINANCE of the City of Federal Way, Washington, relating to Transportation Impact Fees; amending FWRC 19.91.030 through 19.91.110 and 19.91.140 through 19.170. (Amending Ordinance Nos. 09-627, 10-658, and 16-822) ______________________________________________________________________________ WHEREAS, the City recognizes the need to periodically modify Title 19 of the Federal Way Revised Code (“FWRC”), “Zoning and Development Code,” in order to conform to state and federal law, codify administrative practices, clarify and update zoning regulations as deemed necessary, and improve the efficiency of the regulations and the development review process; and WHEREAS, this ordinance, containing amendments to development regulations and the text of Title 19 FWRC, being that the amendments: (a) Relate solely to governmental procedures, and containing no substantive standards respecting use or modification of the environment. (b) Are text amendments resulting in no substantive changes respecting use or modification of the environment. (c) are consistent with Agency SEPA procedures; (d) are consistent with Washington Administrative Code 197-11-800(19) and are therefore need not comply with Process VI review, Chapter 19.80 FWRC, pursuant to Chapter 19.35 FWRC; and WHEREAS, it is in the public interest for the City Council to adopt modified code language for FWRC Chapter 19.91 which establishes development regulations for transportation impact fees within the City of Federal Way; and WHEREAS, the City Council finds that new growth and development in the City will create additional demand and need for public facilities; and Ordinance No. 20-_____ Page 2 of 22 Rev 2/19 LU WHEREAS, the City is authorized by Chapter 82.02 RCW to require new growth and development within the City to pay a proportionate share of the cost of new facilities to serve such new development activity through the assessment of impact fees; and WHEREAS, the impact fees assessed pursuant to Chapter 82.02 RCW must be based upon a showing that new growth and development creates additional demand and need for public facilities, that the impact fees do not exceed a proportionate share of the costs of such additional public facilities, and that the fees spent for facilities reasonable related to the new growth and development; and WHEREAS, the City is authorized by Chapter 82.02 RCW to impose impact fees for system improvement costs previously incurred by the City to the extent that new growth and development will be served by the previously constructed improvements; and WHEREAS, impact fee may be collected and spent for system improvements that are included within a capital facilities plan element of a comprehensive plan; and WHEREAS, the City has adopted a list of transportation capital facilities in the Transportation Element of the Comprehensive Plan; and WHEREAS, RCW 58.17.110 and RCW 58.17.060 require the Council and administrative personnel to make written finding that public facilities; such as roads and streets, are adequate before approving proposed subdivisions, dedications, short plats, and short subdivisions; and WHEREAS, to meet these requirements with respect to public streets and roads, the Council finds that it must assure that public street and roads are adequate to serve new growth and development; and Ordinance No. 20-_____ Page 3 of 22 Rev 2/19 LU WHEREAS, the Council finds that it is in the public interest, and consistent with the intent and purposes of the Growth Management Act, RCW 36.70A et seq., for the City to adopt transportation impact fees which are uniform to the greatest extent practicable; and WHEREAS, The City has conducted extensive research and analysis documenting the procedures for measuring the impact of new growth and development on public streets and roads, and has prepared the report “City of Federal Way Transportation Impact Fees Program” dated November 2020 which serves as the basis for the actions taken by the Council; and WHEREAS, the Council hereby incorporates the Rate Study into this ordinance by reference. The Rate Study utilizes a methodology for calculating transportation impact fees which fulfills all of the requirement of RCW 82.02.060(1); and WHEREAS, based on information in the Rate Study, the Council has determined that the City is composed a single services area for purposes of assessing transportation impact fees; and WHEREAS, in developing the impact fees for public facilities contained in this ordinance, the City has provided adjustments for past and future taxes paid or to be paid by new growth and development, which are earmarked or pro-ratable to the same new public facilities that will serve the new growth and development; and WHEREAS, the Planning Commission conducted properly conducted a duly noticed public hearing on these code amendments on November 4, 2020; and forwarded a recommendation of approval to the City Council; and WHEREAS, the Land Use/Transportation Committee of the Federal Way City Council considered these code amendments on November 2, 2020, and recommended adoption of the text amendments as recommended by the Planning Commission with further modifications as follows: (1) Ordinance No. 20-_____ Page 4 of 22 Rev 2/19 LU NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF FEDERAL WAY, WASHINGTON, DO ORDAIN AS FOLLOWS: Section 1. Findings. The City Council of the City of Federal Way makes the following findings with respect to the proposed amendments. (a) These code amendments are in the best interest of the residents of the City and will benefit the City as a whole by assuring that development activities, including but not limited to new residential, commercial, retail, office, and industrial development, in the city of Federal Way will create additional demand and need for public facilities in the city, and that such new growth and development should pay a proportionate share of the cost of new facilities needed to serve the new growth and development. (b) These code amendments comply with Chapter 36.70A RCW, Growth Management. (c) These code amendments are consistent with the intent and purpose of Title 19 FWRC and will implement and are consistent with the applicable provisions of the Federal Way Comprehensive Plan. (d) These code amendments bear a substantial relationship to, and will protect and not adversely affect, the public health, safety, and welfare. (e) These code amendments have followed the proper procedure required under the FWRC. Section 2. Conclusions. Pursuant to Chapter 19.80 FWRC and Chapter 19.35 FWRC, and based upon the recitals and the findings set forth in Section 1, the Federal Way City Council makes the following Conclusions of Law with respect to the decisional criteria necessary for the adoption of the proposed amendments: Ordinance No. 20-_____ Page 5 of 22 Rev 2/19 LU (a) The proposed FWRC amendments are consistent with, and substantially implement, the following Federal Way Comprehensive Plan goals and policies: TG1 Maintain mobility through a safe, balanced, and integrated transportation system. TP1.3 Identify the improvements and strategies needed to fully implement the City’s Layered Network and meet the level-of-service requirements for transportation. TP2.3 Prioritize transportation projects considering concurrency, safety, multimodal enhancements, environmental impacts, and cost effectiveness. (b) The proposed FWRC amendment bears a substantial relationship to the public health, safety, and welfare because it ensures funding for capital projects in meeting concurrency requirements and provide development with predictability, consistency, and fairness in assessing traffic impact mitigation. Consistency and predictability for developers may encourage new development bringing new jobs and providing more economic activity in the city. (c) The proposed amendment is in the best interest of the public and the residents of the City of Federal Way because it provides for new development paying a proportionate share of the cost of new facilities needed to serve new growth, ensure funding for capital projects to meet concurrency needs, and provide predictability, consistency, and fairness to the developers in assessing development impact fees. Section 3. FWRC 19.91.030 is hereby amended to read as follows: 19.91.030 Findings and authority. The city council of the city of Federal Way hereby finds and determines that development activities, including but not limited to new residential, commercial, retail, office, and industrial development, in the city of Federal Way will create additional demand and need for public Ordinance No. 20-_____ Page 6 of 22 Rev 2/19 LU facilities in the city, and the council finds that such new growth and development should pay a proportionate share of the cost of new facilities needed to serve the new growth and development. The city of Federal Way has conducted extensive research and analysis documenting the procedures for measuring the impact of new developments on public facilities, has prepared the “Rate Study for Transportation Impact Fees, City of Federal Way” dated February 2009 November 2020 (“rate study”), and incorporates that rate study into this title by this reference. The rate study utilizes a methodology for calculating impact fees that fulfills all of the requirements of RCW 82.02.060(1). A copy of the rate study shall be kept on file with the city clerk and is available to the public for review. Therefore, pursuant to Chapter 82.02 RCW, the council adopts this chapter to assess impact fees for streets and roads. The provisions of this chapter shall be liberally construed in order to carry out the purposes of the council in establishing the impact fee program. Section 4. FWRC 19.91.040 is hereby amended to read as follows: 19.91.040 Definitions. The following words and terms shall have the following meanings for the purposes of this chapter, unless the context clearly requires otherwise. Terms otherwise not defined herein shall be defined pursuant to RCW 82.02.090 or given their usual and customary meaning. “Applicant” means a person who applies for a building permit under Chapter 19.20 FWRC and who is the owner of the subject property or the authorized agent of the property owner. “Building permit” means an official document or certification which is issued by the building official and which authorizes the construction, alteration, enlargement, conversion, reconstruction, remodeling, rehabilitation, erection, demolition, moving, or repair of a building or structure. Ordinance No. 20-_____ Page 7 of 22 Rev 2/19 LU “Capital facilities plan” means the capital facilities element of the city’s comprehensive plan adopted pursuant to Chapter 36.70A RCW and such plan as amended. “City code section” means the Federal Way Revised Code or, when followed by a numerical designation, a provision of the FWRC. “Council” means the city council of the city. “Department” means the city’s department of public works. “Development activity” means any work, condition, or activity which requires a permit or approval under the city’s subdivision, zoning, or building code. Exempt permits are set forth in FWRC 19.91.080. “Development approval” means any written authorization from the city authorizing the commencement of a development activity or use. “Director” means the director of the department of public works of the city of Federal Way or her/his designee. “Encumbered” means to reserve, set aside, or otherwise earmark the impact fees in order to pay for commitments, contractual obligations, or other liabilities incurred for public facilities. “Hearing examiner” means the hearing examiner operating pursuant to the powers and duties set forth by Chapter 2.95 FWRC. “Impact fee” means a payment of money imposed by the city of Federal Way on development activity pursuant to this title as a condition of granting development approval. “Impact fee” does not include a reasonable permit fee, an application fee, the administrative fee for collecting and handling impact fees, or the cost of reviewing independent fee calculations. “Independent fee calculation” means the street and road impact calculation, and/or economic documentation prepared by an applicant, to support the assessment of an impact fee Ordinance No. 20-_____ Page 8 of 22 Rev 2/19 LU other than by the use of the rates listed in the fee schedule, or the calculations prepared by the director where none of the fee categories or fee amounts in the traffic transportation impact fee in the fee schedule accurately describe or capture the impacts of the development activity on public facilities. “Interest” means the average interest rate earned in the last fiscal year by the city of Federal Way. “ITE” means the Institute of Transportation Engineers “ITE land use code” means the classification code number assigned to a type of land use by the Institute of Transportation Engineers in the latest edition of Trip Generation. “P.M. peak hour” means the highest volume of traffic for a continuous hour between 4:00 p.m. and 6:00 p.m. on weekdays. “P.M. peak hour trips” means the total vehicular trip ends entering and leaving a place of new development activity on the adjacent public road or street during the p.m. peak hour. “Project improvements” means site improvements and facilities that are planned and designed to provide service for a particular development project and are necessary for the use and convenience of the occupants or users of the project, and are not system improvements. No improvement or facility included in a capital facilities plan adopted by the council shall be considered a project improvement. “Public facilities,” for purposes of this chapter, means the following capital facilities owned or operated by the city of Federal Way or other governmental entities: public streets and roads. “Rate study” means the Transportation Impact Fees Program, City of Federal Way, by Fehr & Peers/Mirai, dated February 2009November 2020. Ordinance No. 20-_____ Page 9 of 22 Rev 2/19 LU “RCW” means the Revised Code of Washington or, when followed by a numerical designation, a provision of the Revised Code of Washington. “Residential” or “residential development” means all types of construction intended for human habitation. This shall include, but is not limited to, single-family, duplex, triplex, and other multifamily development. “Square footage” means the square footage of the gross floor area of the development as defined in this Code. “Street” or “road” means a public right-of-way and all related appurtenances which enables motor vehicles, transit vehicles, bicycles and pedestrians to travel between destinations, and affords the principal means of access to abutting property, including avenue, place, way, drive, lane, boulevard, highway, street, and other thoroughfare. For purposes of this chapter, public streets and roads are collectively referred to as “transportation.” “System improvements” means public facilities that are included in the city of Federal Way’s capital facilities plan, and such plan as amended, and are designed to provide service to service areas within the community at large, in contrast to project improvements. “Transportation” means public streets and roads and related appurtenances. “Transportation impact fee account(s)” means the account(s) established for the transportation impact fees that are collected. The account(s) shall be established pursuant to FWRC 19.91.110 and shall comply with the requirements of RCW 82.02.070. Section 5. FWRC 19.91.050 is hereby amended to read as follows: 19.91.050 Transportation impact fees methodology and applicability. The transportation impact fee rates are generated from the formula for calculating impact fees set forth in the rate study, which is on file with the public works department. Except as otherwise Ordinance No. 20-_____ Page 10 of 22 Rev 2/19 LU provided for independent fee calculations in FWRC 19.91.070, exemptions in FWRC 19.91.080, and credits in FWRC 19.91.090, all new development activity in the city will be charged the transportation impact fee applicable to the type of development as set forth in the traffic transportation impact fee in the current fee schedule as adopted by council. Section 6. FWRC 19.91.060 is hereby amended to read as follows: 19.91.060 Assessment of impact fees. (1) The city shall collect impact fees, based on the land use categories and rates on the current fee schedule, from any applicant seeking development permits, issuance of a building permit or approval for a change in use, except for development exempt under FWRC 19.91.080. This shall include, but is not limited to, the development of residential, commercial, retail, office, and industrial land, and includes the expansion of existing uses that creates a demand for additional system improvements as well as a change in existing use that creates a demand for additional system improvements. The public works department is authorized to determine the appropriate land use category found in the rate schedule that applies to the application. (2) All impact fees shall be due and payable pursuant to the guidelines established in FWRC 19.100.070(3), except as authorized under FWRC 19.91.066. (3) The public works department shall establish the transportation impact fee rate for a land use that is not listed in the fee schedule. The applicant shall submit all information requested by the city for purposes of determining the impact fee rate pursuant to FWRC 19.91.070. (4) For a change in use of an existing building or dwelling unit, including any alteration, expansion, replacement or new accessory building that generates additional trips and permitted Ordinance No. 20-_____ Page 11 of 22 Rev 2/19 LU after City incorporation, the impact fee shall be paid for the applicable impact fee for the land use category of the new use, less any impact fee that would have been previously paid for the land use category of the existing building or dwelling unit set forth in the current fee schedule (regardless of whether impact fees were paid for the prior use). If no impact fee was paid for the prior use, the impact fee for the new use shall be reduced by an amount equal to the current impact free rate of the current use. Other existing buildings or dwelling units permitted under King County prior to incorporation of the City must submit documentation of mitigation fees paid in order to receive an impact fees credit for the prior use. (5) For mixed use developments, impact fees shall be imposed for the proportionate share of each land use based on the applicable measurement in the traffic transportation impact fee rates set forth in the fee schedule. (6) The department of community development services shall not issue the required building permit until a lien has been recorded pursuant to FWRC 19.100.075(3), or the transportation impact fees set forth in the fee schedule have been paid as set forth in the fee schedule or in the amounts that they exceed any credits allowable under this chapter. For a change in use where a building permit is not required, the applicant shall not occupy or permit a tenant to occupy the subject property unless and until the impact fee has been paid. Section 7. FWRC 19.91.066 is hereby amended to read as follows: 19.91.066 Option for deferred payment of transportation impact fee. An applicant may request, at any time prior to building permit issuance, and consistent with the requirements of this section, to defer to final building inspection the payment of a transportation impact fee for single-family residential dwelling units pursuant to FWRC Ordinance No. 20-_____ Page 12 of 22 Rev 2/19 LU 19.100.075. Per RCW 82.02.050(3)(b), the term of this deferral may not exceed eighteen (18) months from the date of building permit issuance. Section 8. FWRC 19.91.070 is hereby amended to read as follows: 19.91.070 Independent fee calculations. (1) If, in the judgment of the director, none of the fee categories or fee amounts set forth in FWRC 19.91.060 accurately describes or captures the impacts of a new development on roads, the department may conduct independent fee calculations and the director may impose alternative fees on a specific development based on those calculations. (2) The applicant may opt not to have the impact fees determined according to the fee structure in the traffic transportation impact fee schedule listed in the city fee schedule, in which case the applicant shall prepare and submit to the director an independent fee calculation for the development activity for which a development permit is being sought. The documentation submitted shall be prepared by a licensed traffic engineer Professional Engineer or Certified Planner and shall show the basis upon which the independent fee calculation was made using procedures consistent with those established in the Trip Generation Handbook, current edition, by the Institute of Transportation Engineers. An independent fee calculation shall use the same methodology used to establish impact fees set forth in the traffic transportation impact fee schedule, shall be limited to adjustments in trip generation rates and lengths used in the rate study, and shall not include travel demand forecasts, trip distribution, transportation service areas, costs of road projects, or cost allocation procedures. (3) The applicant submitting an independent fee calculation will be required to pay the city of Federal Way a fee to cover the cost of reviewing the independent fee calculation. The fee Ordinance No. 20-_____ Page 13 of 22 Rev 2/19 LU required by the city for conducting the review of the independent fee calculation shall be charged on an hourly rate as adopted by the council at the time of the submittal. (4) There is a rebuttable presumption that the calculations set forth in the rate study and the fee set forth in the traffic transportation impact fee schedule are valid. The director shall consider the documentation submitted by the applicant, but is not required to accept such documentation or analysis which the director reasonably deems to be inapplicable, inaccurate or not reliable. The director may require the applicant to submit additional or different documentation for consideration. The director is authorized to adjust the impact fees on a case-by-case basis based on the independent fee calculation, the specific characteristics of the development, and/or principles of fairness. (5) Determinations made by the director pursuant to this section may be appealed as set forth in FWRC 19.91.180. Section 9. FWRC 19.91.080 is hereby amended to read as follows: 19.91.080 Exemptions. (1) Except as provided for below, the following shall be exempted from the payment of transportation impact fees: (a) Alteration or replacement of an existing nonresidential structure that does not expand the usable space, add any residential units or generate any additional p.m. peak trips. (b) Miscellaneous improvements which do not generate increased p.m. peak trips, including, but not limited to, fences, walls, residential swimming pools, and signs. (c) Demolition or moving of a structure when additional p.m. peak hour trips are not generated. (d) A change of use that does not generate one or more p.m. peak hour trips. Ordinance No. 20-_____ Page 14 of 22 Rev 2/19 LU (e) Miscellaneous permits such as electrical, fire protection system, mechanical, plumbing, right-of-way use, shoreline and sign permits which do not generate any new trips. (f) Rezones, comprehensive plan amendments, land surface modifications, commercial subdivisions, boundary line adjustment and lot line eliminations, which do not generate any trips. (g) Structures constructed by a regional transit authority as defined in RCW 82.02.09. (h) Any development permit application that has been submitted to the city before 5:00 p.m. the business day before the effective date of the ordinance codified in this chapter and subsequently determined to be a complete land use application in conjunction with a concurrency application, based on the information on file as of the effective date of the ordinance codified in this chapter. (2) The director shall be authorized to determine whether a particular development activity falls within an exemption identified in this section or under other applicable law. Determinations of the director shall be subject to the appeals procedures set forth in FWRC 19.91.180. Section 10. FWRC 19.91.090 is hereby amended to read as follows: 19.91.090 Credits. (1) An applicant may request that a credit or credits for impact fees be awarded to him/her for the total value of system improvements, including dedications of land, improvements and/or construction provided by the applicant. Credits will be given only if the land, improvements, and/or the facility constructed are for one or more of the transportation projects listed in the rate study as the basis for calculating the impact fee: (a) For one or more of the transportation projects listed in the rate study as the basis for calculating the impact fee. Ordinance No. 20-_____ Page 15 of 22 Rev 2/19 LU (2) The director shall determine if requests for credits meet the criteria in subsection (1) of this section or under other applicable law. Determinations of the director shall be subject to the appeals procedure set forth in FWRC 19.91.180. (3) Each request for a credit or credits shall include a legal description of the dedicated land, a detailed description of improvements or construction provided, and a legal description or other adequate description of the development to which the credit will be applied. (4) For each request for a credit or credits, the director shall determine the value of the dedicated land, improvements, or construction on a case-by-case basis. In the event that the applicant disagrees with the director’s valuation, the applicant may submit an appraisal for the director’s consideration, prepared by a state certified MAI (Member of the American Institute of Appraisers) or licensed engineer and be licensed in good standing pursuant to Chapter 18.40 RCW et seq., in the category for the property to be appraised, and shall not have a fiduciary or personal interest in the property being appraised. (5) The appraiser and/or licensed engineer shall be directed to determine the fair market value of the total value of the dedicated land, improvements, and/or construction provided by the applicant. The applicant shall pay for the actual costs for the appraisal. (6) After receiving and reviewing the appraisal, the director will determine the dollar amount of any credit, the basis for the credit, the legal description of the real property dedicated where applicable, and the legal description or other adequate description of the project or development to which the credit may be applied with issuance of the building permit. If the total value of any such dedication, improvement or construction cost exceeds the amount of the impact fee obligation, the developer will not be entitled to reimbursement of the difference. Ordinance No. 20-_____ Page 16 of 22 Rev 2/19 LU (7) No credit shall be given for project improvements or right-of-way dedications for direct access improvements to and/or within the subject development above and beyond what is proposed in the capital facilities plan. (8) Any claim for credit must be made before payment of the impact fee and prior to the issuance of the building permit or a permit for a change in use. The failure to timely file such a claim shall constitute a final bar to later request any such credit. (9) Determinations made by the director pursuant to this chapter shall be subject to the appeals procedures set forth in FWRC 19.91.180. (10) No impact fee for a specific development shall be increased or decreased once said fee has been paid. Section 11. FWRC 19.91.100 is hereby amended to read as follows: 19.91.100 Adjustments. Pursuant to and consistent with the requirements of RCW 82.02.060, the rate study has provided adjustments for future taxes to be paid by the development activity which are earmarked or pro-ratable to the same new public facilities which will serve the new development. The traffic transportation impact fee rates in the fee schedule have been reasonably adjusted for acknowledge taxes and other revenue sources which are anticipated to be available to fund public improvements. Section 12. FWRC 19.91.110 is hereby amended to read as follows: 19.91.110 Establishment of impact fee account. (1) Impact fee receipts shall be earmarked specifically and deposited in a special interest- bearing account. (2) The city shall establish a separate impact fee account for the fees collected pursuant to this chapter: transportation impact fee account. Funds withdrawn from the account must be used Ordinance No. 20-_____ Page 17 of 22 Rev 2/19 LU in accordance with the provisions of this chapter and applicable state law. Interest earned on the fees shall be retained in the account and expended for the purposes for which the impact fees were collected. (3) On an annual basis, the finance director shall provide a report to the council on the transportation impact fee account showing the source and amount of all moneys collected, earned, or received, and the public improvements that were financed in whole or in part by impact fees. Impact fees shall be expended or encumbered within six ten years of receipt, unless the council identifies in written findings extraordinary and compelling reasons for the city to hold the fee beyond the six year period. Under such circumstances, the council shall establish the period of time within which the impacts fees shall be expended or encumbered. Section 13. FWRC 19.91.140 is hereby amended to read as follows: 19.91.140 Refunds. (1) If the city fails to expend or encumber the impact fees within ten years of when the fees were paid, or where extraordinary or compelling reasons exist, such other time periods as established pursuant to FWRC 19.91.110, the current owner of the property on which impact fees have been paid may receive a refund of such fees. In determining whether impact fees have been expended or encumbered, impact fees shall be considered expended or encumbered on a first in, first out basis. (2) The city shall notify potential claimants by first class mail deposited with the United States Postal Service at the last known address of such claimants. A potential claimant or claimants must be the owner of record of the real property against which the impact fee was assessed. Ordinance No. 20-_____ Page 18 of 22 Rev 2/19 LU (3) Property owners seeking a refund of impact fees must submit a written request for a refund of the fees to the director within one year of the date the right to claim the refund arises or the date that notice is given, whichever is later. (4) Any impact fees for which no application for a refund has been made within this one- year period shall be retained by the city and expended on the appropriate system improvements. (5) Refunds of impact fees or offsets against subsequent impact fees under this section shall include any interest earned on the impact fees by the city. (6) When the city seeks to terminate any or all components of the impact fee program, all unexpended or unencumbered funds from any terminated component or components, including interest earned, shall be refunded pursuant to this section. Upon the finding that any or all fee requirements are to be terminated, the city shall place notice of such termination and the availability of refunds in a newspaper of general circulation at least two times and shall notify all potential claimants by first class mail at the last known address of the claimants. All funds available for refund shall be retained for a period of one year after the second publication. At the end of one year, any remaining funds shall be retained by the city, but must be expended for the appropriate public facilities. This notice requirement shall not apply if there are no unexpended or unencumbered balances within the account or accounts being terminated. (7) The city shall also refund to the current owner of property for which impact fees have been paid all impact fees paid, including interest earned on the impact fees, if the development activity for which the impact fees were imposed did not occur; provided, however, that, if the city has expended or encumbered the impact fees in good faith prior to the application for a refund, the director can decline to provide the refund. If within a period of three years, the same or subsequent owner of the property proceeds with the same or substantially similar development activity, the Ordinance No. 20-_____ Page 19 of 22 Rev 2/19 LU owner can petition the director for an offset in the amount of the fee originally paid and not refunded. The petitioner must provide receipts of impact fees previously paid for a development activity of the same or substantially similar nature on the same real property or some portion thereof. The director shall determine whether to grant an offset, and the determinations of the director may be appealed pursuant to the procedure in FWRC 19.91.180. Section 14. FWRC 19.91.150 is hereby amended to read as follows: 19.91.150 Use of funds. (1) Pursuant to this title, transportation impact fees: (a) Shall be used for one or more of the transportation projects listed in the rate study as the basis for calculating the impact fee, which are for system improvements that will reasonably benefit the new development activity; (b) Shall not be imposed to make up for deficiencies in public facilities; and (c) Shall not be used for maintenance or operation. (2) Transportation impact fees may be spent for public improvements to streets and roads as herein defined and including, but not limited to, transportation planning, engineering design studies, land survey, right-of-way acquisition, site improvements, necessary off-site improvements, engineering, architectural, permitting, financing, administrative expenses, construction of streets and roads and related facilities such as curbs, gutters, sidewalks, bike lanes, storm drainage and installation of traffic signals, signs and street lights, applicable impact fees or mitigation costs, and any other expenses which can be capitalized. (3) Transportation impact fees may also be used to recoup system improvement costs previously incurred by the city to the extent that new growth and development will be served by the previously constructed improvements or incurred costs. Ordinance No. 20-_____ Page 20 of 22 Rev 2/19 LU (4) In the event that bonds or similar debt instruments are or have been issued for the advanced provision of public improvements for which impact fees may be expended, impact fees may be used to pay debt service on such bonds or similar debt instruments to the extent that the facilities or improvements provided are consistent with the requirements of this section and are used to serve the new development. Section 15. FWRC 19.91.160 is hereby amended to read as follows: 19.91.160 Periodic adjustment of rates. (1) The traffic transportation impact fee in the fee schedule will be amended to reflect changes to the 20-year transportation project list as part of adoption of amendments to the capital facilities element of the city’s comprehensive plan. Amendment to the schedule for this purpose shall be adopted by the council. (2) Beginning January 1, 2021, and for every year thereafter, the transportation impact fee in the fee schedule shall be adjusted by the annual change in the June Consumer Price Index for the Seattle area. The traffic impact fee in the fee schedule shall be indexed to provide for an automatic fee increase each January 1st beginning in the year 2011. A three-year moving average of the Washington State Department of Transportation Construction Cost Index will be used to determine the increase in fees for each year to reflect increased project costs. (3) A new rate study, which establishes the traffic transportation impact fee in the fee schedule, shall be updated every three years, unless the city determines that circumstances have not changed to warrant an update. Section 16. FWRC 19.91.170 is hereby amended to read as follows: 19.91.170 Administrative fees. Ordinance No. 20-_____ Page 21 of 22 Rev 2/19 LU (1) There shall be a fee for the administration of the transportation impact fee program in an amount equal to three five percent of the amount of the total traffic transportation impact fee determined from the fee schedules. The administrative fee shall be deposited into an administrative fee account within the transportation impact fee funds. Administrative fees shall be used only to defray the cost incurred by the city in performing actions related to implementation of FWRC 19.91 and update of the transportation impact fee program. The administrative fee is not creditable or refundable. (2) The administrative fee, in addition to the impact fee, shall be paid by the applicant at the same time as the impact fee. Section 17. Severability. The provisions of this ordinance are declared separate and severable. The invalidity of any clause, sentence, paragraph, subdivision, section, or portion of this ordinance, or the invalidity of the application thereof to any person or circumstance, shall not affect the validity of the remainder of the ordinance, or the validity of its application to any other persons or circumstances. Section 18. Corrections. The City Clerk and the codifiers of this ordinance are authorized to make necessary corrections to this ordinance including, but not limited to, the correction of scrivener/clerical errors, references, ordinance numbering, section/subsection numbers and any references thereto. Section 19. Ratification. Any act consistent with the authority and prior to the effective date of this ordinance is hereby ratified and affirmed. Section 20. Effective Date. This ordinance shall be effective five (5) days after passage and publication as provided by law. Ordinance No. 20-_____ Page 22 of 22 Rev 2/19 LU PASSED by the City Council of the City of Federal Way this _________ day of ___________________, 20___. CITY OF FEDERAL WAY: ________________________________ JIM FERRELL, MAYOR ATTEST: ________________________________________ STEPHANIE COURTNEY, CMC, CITY CLERK APPROVED AS TO FORM: __________________________________________ J. RYAN CALL, CITY ATTORNEY FILED WITH THE CITY CLERK: PASSED BY THE CITY COUNCIL: PUBLISHED: EFFECTIVE DATE: ORDINANCE NO.: