Video & as-it-happened coverage: ‘Impact fees’ for development? City Councilmembers discuss possibly doing what 80 other WA cities already do

(UPDATED WEDNESDAY NIGHT with archived Seattle Channel video of meeting added below, document links added inline, new Rasmussen quote at end)

POST-MEETING TOPLINES:
-Council told that 80 other WA cities have impact fees
-State law doesn’t allow them to be imposed for transit service, though
-Councilmember Rasmussen suggests creating a ‘working group’ to look at it
-Most public commenters say ‘long overdue’

ADDED WEDNESDAY NIGHT:
-Above, full video of meeting
-Meeting documents, provided by Rasmussen’s office *adding*
-Added quote at end of story – we asked him “what next?” post-meeting

AHEAD: Our as-it-happened chronicling of what was said during the meeting:

12:05 PM: If you see this before 1:30 pm or so, hit the “play” button in the video window above and you’ll see the live Seattle Channel feed of what just started in the City Council chambers – the Transportation Committee-hosted discussion “Impact Fees 101.” (Once the meeting ends, we’ll take down the video window until the archived video is available later.) We’ll be noting toplines as it goes, in case you can’t watch live or don’t see this until later. As committee chair Councilmember Tom Rasmussen (a West Seattle resident) said while opening it, ours is the fastest-growing city in the country, but growth stresses the transportation system and infrastructure among other things, so, how to pay for them? Many citizens have told him, he said, “let the developers pay” – and that would mean “impact fees.” The panel includes council staffers, a consultant, a rep from Bellevue to talk about what they do, and a rep from the Association of Washington Cities, to talk about who does what in other places around the state.

12:15 PM: Though this is a long-running topic, the meeting didn’t come with much advance notice, and a council assistant is mentioning a chart is incorrect because he put it together “hastily.” They’ve moved on to the consultant, Randy Young, who has put together almost 200 studies about “impact fees.” (EXPLANATORY DOCUMENT ADDED) They are one-time fees, in most cases, he explains, and they are only paid by “one sector of the economy” – developers. They are charged for “capital facilities” – building things like sidewalks or streets, but not for, say, machinery like street sweepers or services like pothole-fixing, transit, etc. And they have to be charged for things that the new development require – they can’t be charged for existing problems. The state’s Growth Management Act cites four areas in which impact fees can be charged – transportation (roads – even a sidewalk can’t be added unless there’s nearby road construction), parks/recreation, fire protection (building or expanding stations/equipment), schools.

“You can pay for ‘system improvements’,” he says, explaining that state law describes that as “providing for transportation network, the streets that the community as a whole uses – a neighborhood street would not meet that description.” An internal street in a development can’t be paid for by an “impact fee.” And you can’t pay for “repair, renovation – (whatever you’re charging impact fees for) has to add capacity.” Could an alley improvement be paid for? Maybe, consultant says, since Seattle does count alleys as part of the transportation network. 4 rules for impact fees: #1 – you can’t make new development pay for an existing deficiency; #2 – connection has to be made between development and benefits received (number of trips it generates, for example); #3 – no double-dipping – if another source of revenue is already paying for what you want the impact fee to cover, or part of it, you’d have to figure out what part of the impact fee is offset by the money that’s already being used; #4, state law says you cannot rely solely on impact fees – they can’t cover the entire cost of something.

12:30 PM: So, why would a city want to do this? Young asks rhetorically. He suggests: City’s making a policy approach, developers should pay part of the way. Or, it’s a quality-of-life issue, the city needs to get money for preserving it even as it grows. Otherwise, you could raise local taxes, or settle for a reduced level of service. Next, he addresses myths, such as, the suggestion that growth brings new taxes that cover the costs of new infrastructure; it does bring more money, he said, but generally not in the area that would fund the impacts it causes. He mentions again that the city does have impact fee-type charges in South Lake Union and Northgate, related to the State Environmental Policy Act (SEPA), but they are voluntary. Another myth, he said, is that the developers and builders are the ones paying it and it will stop development. Not true, he said – if it stops growth, then why are 80 cities in Washington charging impact fees? He shows supporting charts (UPDATE: here’s the map he showed). Do impact fees affect the affordability of housing? Generally, no – they’re a very small percent of the total cost, he says. What about the city’s competitiveness? Again, he says, 80 cities are charging them, and the development did NOT go somewhere else. “We’re not picking on developers (with impact fees), we’re asking them to join the party” since others already are paying, he concludes.

(ADDED DOCUMENTS: What types of fees those 80 cities charge, and what the rates are, per city; also, from consultant Young, comparison examples of how the fees shake out in some of those cities)

12:41 PM: Councilmember Rasmussen promises the docs and slides will be available on the committee website soon. Now, on to the Association of Washington Cities rep, Dave Williams, who gives some history about how this all started in 1990. He says the jurisdictions that started adding impact fees in the ensuing years were mostly suburban. Spokane has impact fees; Tacoma does not, he notes – and then consultant Young interrupts Williams to say that Tacoma has just started the process of looking into them. Builders have been politically pressing to change them or get rid of them, the AWC rep notes. The consultant interjects shortly thereafter that developers still want to be in thriving cities, and there’s been more of it even in the cities with impact fees.

On the point of how impact fees might affect affordable housing, Williams said the law was changed so that “up to 80 percent of the costs for low-income housing can be exempted” without raising the fees for other types of development. Could transit costs be included in impact fees? Williams says they’ve been lobbying for that but “haven’t gotten very far.”

12:56 PM: On to Eric Miller, from the city of Bellevue’s Transportation Department, which does charge transportation impact fees, that feed into their capital-improvement plan and the funds that pay for it. (ADDED DOCUMENT HERE) Over the next 12 years, they have 18 “fully funded impact-fee projects,” he says, showing a map. Over that time, they expect to get about $82 million in development impact fees, about a fifth of their overall funding. The Bellevue Council “adopted a stepped impact-fee approach” in 2009, according to Miller, who says they’re now in “step 2.” And he adds, during Q/A, they’ve had some court challenges – not to the sum so much as to, for example, the city’s determination of how many new trips a project will generate. He says affordable-housing developments and child-care facilities are among the categories that are exempt from impact fees in Bellevue.

1:14 PM: Rasmussen says he thinks the information “has potential for Seattle – I think we should discuss this among ourselves, creating a working group to look at the potential for adopting an impact fee in Seattle in some form.” But, he notes, “we have not heard from developers yet … or from the community.” 14 people have signed up to comment, he notes, and it’s public-comment time now.

First to speak, frequent commenter/council critic Alex Zimmerman, who accuses corporations of stealing money from the city. Second, Eden Mack from the local PTSA Council, who points out that school enrollment is back on the upswing, and more schools and safer transportation routes are, and will be, needed. Third, Roger Valdez from the developer-backed group Smart Growth Seattle, who starts with a list of recent council actions regarding development. He says the idea of an impact fee “makes (him) laugh. We already pay numerous fees and charges for infrastructure replacement. There isn’t a development in the city that doesn’t pay fees … for numerous infrastructure improvements.” He says the fees figure into higher rents. Fourth, Selena Carsiotis, who says she has worked for development firms/projects but is “actually here to defend impact fees.” She says the impact fees for projects she was familiar with on the Eastside helped create infrastructure that made it easier for the projects to be sold and inhabited. Fifth, Linda Melvin, identifying herself as a Ballard resident, says the discussion was long overdue and that it “was amazing to me.”

Sixth, John Fox, of the development-limit-supporting Coalition for an Affordable Livable Seattle and Anti-Displacement Coalition, says “the fees that Mr. Valdez was talking about account for only a tiny, tiny fraction of the infrastructure” impacts by developments. He contends that even a fee of a few dollars per square foot of office development could have reduced the burden on the city’s taxpayers. Seventh, Tony Provine of the Ravenna-Bryant Community Association says he feels this is “long overdue” and that people in his community “feel they have been unfairly burdened with the cost of” new development. Eighth, a woman whose name we didn’t catch, says it seems a little late for this. “Along with all this growth, and increasing jobs, we seem to have forgotten that … all this growth is cutting a lot of people out of homes, and transportation.” Ninth, Ballard resident William Parsons asks, why did it take the Seattle Council so long to take this up, especially considering 80 other cities have impact fees already – “it boggles my mind.”

1:33 PM: West Seattle resident Deb Barker, a retired land-use planner, speaks 10th, first West Seattleite that we know of. The city where she worked as a planner, Federal Way, had impact fees from the start, and says she saw them work well, from SEPA-based fees to Traffic Impact Fees (TIF), as well as school-impact fees. “In my experience, impact fees create predictability,” she said, urging the council to implement them. Another West Seattleite, arborist Michael Oxman, speaks 11th, and starts by talking about street trees. The city has six crew members maintaining 40,000 trees, he notes, and says that roads are benefited by trees whose branches reach over them, keeping them in shade. Asked by Councilmember Rasmussen how that relates to impact fees, he says the crews are “grossly underfunded” and could benefit from impact-fee-type funding. Final speaker is Sarajane Siegfriedt of Lake City, who says she wants to emphasize the growth in need for school facilities, especially north of the Ship Canal, and the fact the Legislature hasn’t been alloting money to help with this. “Everyone knows what the facts are, the myths will wither away, and we thank you for doing this,” she concludes.

Rasmussen then moves, at 1:39 pm, to wrap up the meeting, declaring it “very, very interesting” and saying he doesn’t think growth is going to stop any time soon, so this kind of fee may be an “important source … particularly for our schools.”

ADDED WEDNESDAY NIGHT: Via e-mail after the meeting, we asked Rasmussen about a timetable for next steps. His reply:

As to next steps, I intend to begin working toward a City Council decision on enacting impact fees. This could be part of the work of the Finance Committee or a special committee. I will be meeting with my colleagues to organize our work on this and develop a process and schedule.

I will make sure that they are public meetings in the Council Chambers or other public location where they can be broadcast or recorded if the Chambers are in use and that the public is kept fully involved and informed.

19 Replies to "Video & as-it-happened coverage: 'Impact fees' for development? City Councilmembers discuss possibly doing what 80 other WA cities already do"

  • Diane September 10, 2014 (2:19 pm)

    well that was EXCELLENT!!! Thanks TR for the great coverage
    ~
    I watched via seattlechannel, took notes, recorded to watch several more times (a ton of information); just called Tomā€™s office to thank him for getting this going and ā€œplease do this asapā€; we need impact fees now; yes, long long long overdue
    ~
    so we learned today that 80 other cities already charge impact fees, that these fees are a small percentage, have not been shown in any city to deter development or have any negative impacts on development; it is embarrassing to learn that our supposedly progressive city is 24 years behind the curve
    ~
    LOVED the citizen comments (concur with the speaker who said ā€œdisappointed all the council members except Tom left the room prior to public commentā€); Deb Barker was awesome as usual, especially sharing her experience as a land use planner in Federal Way, where they also have been charging school and traffic impact fees, with no negative impacts
    ~
    I asked Tomā€™s assistant for contact information for all the presenters, and copies of all the documents shown today; if anyone else wants this info, call Tomā€™s office 206-684-8808; he needs to know citizens support impact fees

  • Diane September 10, 2014 (2:29 pm)

    Selena Carsiotis (thank you; I didnā€™t catch her name) from Sammamish; where presenters said the impact fees are charged near highest rate allowed, 97%; really appreciated her PRO-impact fees testimony of why/how it helps developers/real estate projects

    • WSB September 10, 2014 (2:34 pm)

      Thank heavens all but Jo (?) reiterated their full names when stepping up to the mike. I verified all spelling guesses via the Web. Well, I am not sure if I have Sarah Jane spelled correctly (if anyone knows her, please advise). Otherwise, if you’re, oh, say, the Ravenna-Bryant Community Association president, you should come up in Google and he did. (If he didn’t, we’re friends with the publisher of ravennablog.com and could have consulted her.) I am following up with CM Rasmussen’s office regarding the docs too, and a followup question on timeline … TR

  • Jeff September 10, 2014 (2:45 pm)

    Impact fees sound reasonable. In practice, it will be that or property taxes. The current approach of “pretend it won’t be a problem” is just not sustainable in the long run.

  • Diane September 10, 2014 (2:51 pm)

    agree re speakers stating their names; also really appreciate Tom asking presenters from the start to spell out acronyms; drives me crazy when they have an entire discussion in city council using an acronym unfamiliar to the public (like in yesterdayā€™s transportation meeting)

  • wakeflood September 10, 2014 (3:18 pm)

    This was really, really nice, Tracy. Worked like a charm to watch the proceedings in real time!

    I too was disappointed to see several members leave before the comments. I hope it was because they were already on board with the need to create the fee system but that’s just my hope. Who knows, maybe they recognized the Russian(?) gentleman with his sign and decided their lunch was waiting for them instead? ;-)

    Let’s keep the pressure on and see if they can get this instituted asap. Seems like every day they’re permitting more density development that isn’t going to cover their fair share…

  • Ray September 10, 2014 (3:59 pm)

    Regardless of the outcome, the developers will not eat these fee costs. They will pass them along to the property owners/management companies/etc who will then pass it on to the ultimate buyer or renter of the property.

    While this is a valid tax source, do not be so naĆÆve to think there will not be impacts to other groups besides the developers.

  • Eric1 September 10, 2014 (5:57 pm)

    I think that this is the right way to gain money for infrastructure. Most of the needs of transit, roads and other city services are strained by new or additional development. It should be those people who pay the costs of “fixing it” to accommodate the increased load. If it adds a few thousand dollars to the purchase price, that is the cost of buying a new residence. If you buy an existing residence, you are just replacing people moving out with little net change in infrastructure needs thus there is no need for impact fees.

  • Skittles4Marshawn September 10, 2014 (11:03 pm)

    It seems that many of the concerns voiced on the blog have to do with parking/transit issues. It’s disappointing that state law does not allow these impact fees to be used for transit service, because that would be a very logical place to put money from high-density, carless developments.

    As I mentioned on another post, since our alley is unpaved and in terrible condition, we can’t access our garage. All of our neighbors also utilize street parking. If our alley were paved, we’d definitely want to park our car in our garage! Improving alleys near high-density development really could free up a lot of street parking, and would benefit everyone.

    ETA: I should note I’m in the Morgan Junction area, and I often have to park a block or so from my house.

  • Brian September 11, 2014 (7:35 am)

    While it is encouraging that they’re finally considering this as an option, it’s really frustrating for those of us who have been banging the “Impose Impact Fees!” drum for the last few years (or longer).
    .
    We need to stop being reactive to things we can plainly see coming.

  • wakeflood September 11, 2014 (7:48 am)

    Skittles, you aren’t alone in that concern. It would appear that there are folks trying to make that very change to the law down in Olympia. And before you can “pfffst@!” to the idea that Oly has any love for anything Seattle may want – especially if it deals with transit – I’m holding out hope that other municipalities (80!) will throw their weight behind the concept as well.

    Wonder if there’s any way us wee folk can help support that???

  • Deb Barker September 11, 2014 (8:31 am)

    Skittles4Marshawn – The Morgan Community Association (MoCA) meets next month on Wed. October 15, 2014 at 7:00 pm at The Kenney. We haven’t set the meeting agenda yet, but a discussion on alley conditions would be a good one to have.
    MoCA is at http://www.morganjunction.org. Hope to see you there. Deb

  • John September 11, 2014 (8:50 am)

    Skittles4Marshawn,
    Since you have now twice mentioned your alley, unpaved and in terrible condition, you might not know that the alley behind you house is your responsibility.
    At some point someone used your garage as intended, but then homeowners neglected to maintain their alley and stopped using their garages with the resultant parking on street issues we hear about so much. If people maintain their alleys they would avoid the search for parking, wasting gas/polluting, wasting time, keeping the street parking open and enhance the quality of life in our city.
    -From DPD website:
    “What some property owners do not realize is that they are responsible for maintaining part of the right-of-way next to their property, including the sidewalk and planting strip, or the roadway shoulder if unimproved. Property owners are also responsible for maintaining unpaved alleys next to their property.”

  • John September 11, 2014 (8:56 am)

    When we start to embrace impact fees, addressing where all people park their cars would be a good place to start. Eric1 claims that only new people coming in are adding to the problem, but Skittles’
    example exposes the underbelly of the issue, that of people already here or moving in and adding to the problem by not using their garages for parking.

  • miws September 11, 2014 (11:10 am)

    Skittles, I don’t know if this would be a viable option for you and your neighbors, money-wise and otherwise, but alley improvements may be possible, though at property owners’ expense:

    http://www.seattle.gov/transportation/alleys.htm

    .

    Mike

  • Joe Szilagyi September 11, 2014 (2:38 pm)

    I think it might be about time to request SDOT to do a parking capacity audit of one West Seattle urban area as a pilot: what’s the street parking capacity? What’s percentage of SFHs have a 1 car capacity driveway? 2, 3 cars? How about garages? How many non-SFH housing units? How many parking spaces for all of them? Last, how many cars are registered in that area from state records?
    .
    What would people say if the numbers revealed a parking crisis? What would they say if there is no crisis?

  • Mickymse September 11, 2014 (4:43 pm)

    Yes, AWESOME coverage, TR! This is a great way to get the information out to more people!
    .
    In fairness to (some of) the Councilmembers, though, I’d point out that this was more of a ‘Lunch & Learn’ briefing, so more Councilmembers attend who may not be actual members of the sponsoring Council Committee. Then, because it was billed as an official Council Committee meeting — and not some other type of event that might have less coverage or be in a different location — it is required to have Public Comment time, even though some of those Councilmembers — even those on the Committee — might not have this time blocked out on their calendars because of the special schedule time. Make sense? But that doesn’t mean that they did not leave a staff person in the chambers to note comments or that they won’t watch the video later.

  • Mickymse September 11, 2014 (4:47 pm)

    Well, Joe, I can offer as an example a project in North Delridge, where the Neigborhood Council requested the rechannelization of the street to put in the peak-hour bus-only lane.
    .
    The proposal to add bike lanes at the same time, and permanently remove parking on the west side of the street between Genesee and Andover upset a couple of residents to the point of publicy posting signs and other expressions of their anger about the changes.
    .
    However, when I walked the street to confirm I found that every residence that was losing a street space had a driveway, and only one no longer had the planned access to a garage-type building on their property.

  • bill bradburd September 15, 2014 (2:40 pm)

    It should be noted that while Impact Fees cannot be used for transit, the Transportation Benefit District CAN seek impact fees for transit purposes. The Board of the TBD is City Council…

Sorry, comment time is over.