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2021-04-21 Planning Commission MinutesPlanning Commission Minutes Page 1 April 21, 2021 CITY OF FEDERAL WAY PLANNING COMMISSION April 21, 2021 City Hall 6:30 p.m. Zoom MEETING MINUTES Commissioners present: Tim O’Neil, Wayne Carlson, Diana Noble-Gulliford, Tom Medhurst, Dale Couture, Hope Elder, Jae So, and Anna Patrick. Commissioners absent: Lawson Bronson and Eric Olsen (both excused). City Staff present: CD Director Brian Davis, Planning Manager Keith Niven, Associate Planner Chaney Skadsen, City Attorney Eric Rhoades, and Administrative Assistant II Tina Piety. CALL TO ORDER Vice-Chair O’Neil called the meeting to order at 6:30 P.M. MINUTES Commissioners Carlson, Patrick, and Noble-Gulliford requested changes/updates to the minutes presented with the packet to more fully represent their comments. The April 3, 2021, minutes were approved as presented. PUBLIC COMMENT None COMMISSION BUSINESS Discussion, Housing Action Plan (HAP): Updates to the Strategies and Public Open House Findings – Senior Planner Skadsen delivered the staff presentation. This is for information only. Two events were held on Zoom for an explanation of the project and citizen input. Staff utilized some fun engagement tools, one of which was the creation of a Word Cloud of what people love about Federal Way. Popular words include diversity, parks, friendly people, community events, and location. Citizen input included: When asked if going to move in the next five years: • A traditional single-family residence is desired. • Small cottage housing and duplex/triplex options were favored. Concerns with condos and apartments: • Families and individuals that have pets. • Units are dark and do not have enough windows. • Lack privacy. Planning Commission Minutes Page 2 April 21, 2021 ADUs should be easier to develop: • Federal Way’s code is more complicated than nearby cities. • ADUs are important and provide a housing option for those with disabilities. Some single-family minimum lot sizes are too big: • Smaller lots, cottage-type housing, and townhomes are limited with current zoning. The following items will be added to the proposed HAP strategies: 1. Partner to provide homeownership educational programs. 2. Consider pet-friendly amenities in apartment/condos. 3. Promote elements for community and economic development near transit. 4. Seattle ADUniverseexample: https://aduniverse-seattlecitygis.hub.arcgis.com/. 5. Reformulate Strategy #2 to state: Update area-specific development regulations and design standards to be responsive to changing conditions and support walkable neighborhood centers through updated and new subarea planning. In response to Commissioner Noble-Gulliford’s question at the last meeting regarding financing, Planner Skadsen stated that FHA, VA, and conventional loans are available for purchasing attached housing. In addition, construction mortgages, aka self-build loans and conventional loans are available for constructing attached housing. Commissioner Noble-Gulliford stated that Federal Way has been discussing mixed-use for a long time. She noted the Uptown Apts are mixed-use, but there is a lack of parking for employees and customers of the stores. The city needs to address parking. The city can’t assume people will be taking the bus. She commented that mixed-use has been waived for the Sound Transit station Transit Oriented Design (TOD) projects. Why did the city bargain away this tool? Director Davis stated Community Development will work with Public Works on the parking concerns. In regards to the mixed-use question, it has been raised before and he will resend an email that discusses the Council’s approved agreement and what the city gained by this approval. Commissioner Noble-Gulliford asked what was the demographics of the open houses’ attendees. Planner Skadsen responded there were eight attendees on Thursday and four on Saturday. The attendees were of diverse ages, races, and living situations. Also, there were realtors, aspiring homeowners, and community leaders. The city did a lot of outreach, but this is all that showed. A discussion was held as to why do people buy attached housing. If two units, the owner could live in one and rent the other out, or maybe have family live there. Planner Skasden stated that if there are five or more units it must be a commercial venture and there are various loans available. The sale price may be a factor since attached housing is estimated to be less than detached single-family. However, recently the median sale prices have risen greatly (exceeding 400,000). In addition, there are fewer newer attached dwelling developments. Commissioner Noble-Gulliford asked why aren’t more condominiums being built? Also, how are they financed? Planner Skadsen commented that there are two types of condos, those where the owner also owns the lot and the other where the lot is owned in common and managed by a Homeowners Association and financing is handled by the county. Vice-Chair O’Neil stated that in the last 10-15 years builders have been often sued by HOAs because of building issues and that has driven many out of the market. Many are now building apartments because they can sell them to a property management company and thereby have no further liability. Vice-Chair O’Neil said that usually, the biggest cost is insurance. Lifestyle Planning Commission Minutes Page 3 April 21, 2021 condos like the ones in Burien that are walkable have been successful. Commissioner Noble-Gulliford said that ideally, Federal Way should have condos in the city center for walkability, but she sees almost all are rentals. How do we encourage condo development in the city center?. Planner Skadsen replied she will ask the city’s consultants how we can encourage condo development. Commissioner Patrick expressed her concerns about multi-family housing impacts. She shared a document that outlines her concerns (attached). In her document, she states “Low-income communities on the east side are getting squeezed out of their community by developers who buy up apartments when the LIHTC duration requirements expire and convert them to market rate as the demand for upper income bracket rentals grow. It appears that this leads to fully tax-exempt housing in south King County while reserving the east King County housing for the upper most tax bracket allowed with less tax breaks and more tax revenue.” Housing that doesn’t bring in property tax is a big burden on our city. “DevCo’s housing in Federal Way reflects complete year over year tax exemptions while bringing in massive tax revenue for the same housing in Issaquah where they rent at higher income brackets. This is reflected in our school funding and funding for public safety and services.” Planning Manager Niven commented there are many layers to increasing homeownership. Supply-side economics is one factor. Currently, there is more demand than supply, which is pushing up prices. We need to have housing at all price points. Many of those who are income-restricted are being pushed out to where they have a long commute and there is less available mass transit. Commissioner Noble-Gulliford inquired if the city would issue a permit for a four-plex in a single-family neighborhood where the HOA has a rule of no more than one residence per lot. Planner Skadsen replied that the city is not bound to HOA rules and would approve the project if it meets the city’s code requirements. Meeting the HOA rules is a civil matter between the HOA and the builder. Commissioner Noble-Gulliford asked how many homes rent out a single room? Planner Skadsen replied the city does not keep this statistic but expects they would need a business license and the number could be determined from that. Manager Niven commented that if it is a short-term rental they must have a business license, but if to a family member, no business license is required. The city is developing a rental inspection program that would capture the number. Director Davis clarified that we are proposing that if they rent just one unit, they would not fall within the program but if more than one rental, they would be required to be inspected by our program. Commissioner Patrick asked if in-home care or group home would be considered an indirect rental that would be included in the city’s rental inspection program? Director Davis stated that other regulatory agencies may inspect group homes, and if they do so, we wouldn't include them in our program. Vice-Chair O’Neil inquired if I want to sell my home in which I currently rent out my basement and it is a nonconforming use, can I tell the buyer they will be able to rent the basement? Will inspectors be looking for violations? Director Davis replied as long as the nonconforming use meets the city’s provisions and is legally established it can continue. The city is not trying to burden owner-occupied rentals. The city will not be looking for violations and it would only be considered one if a complaint is made. Vice-Chair O’Neil commented that at our last meeting, Mr. Pace suggested the city use a 50-year planning horizon rather than the current 20-year. Why don’t we do this? Director Davis replied that the city can do a 50-year horizon; however, it is tied to the comprehensive plan and we would have to plan out for 50 years for future needs and infrastructure, and the more time that passes the less the accuracy. Going beyond 20 years is major guesswork. Vice-Chair O’Neil asked if the city could allow overlay zoning for specialty housing. Director Davis commented the city currently uses overlay zoning with some areas that have additional conditions and restrictions such as the CP-1 and this can be continued. Planning Commission Minutes Page 4 April 21, 2021 STAFF BUSINESS Manager’s Report – Director Davis reported that the growth targets will be presented to the council soon; staff will keep the Commission informed of its progress. Manager Niven will be taking over the staff lead and this report; Director Davis’ involvement will be phased out. NEXT MEETING May 5, 2021, 6:30 p.m., Zoom Meeting ADJOURN The meeting adjourned at 8:00 P.M. K:\Planning Commission\2016\Meeting Summary 04-21-21.doc