BILL REQ. #:  H-4115.2 

READ FIRST TIME 02/06/12.   

     AN ACT Relating to modernizing the functionality of the state environmental policy act without compromising the underlying intent of the original legislation; amending RCW 43.21C.031, 43.21C.087, 43.21C.229, 43.21C.420, 36.70A.490, 36.70A.500, 82.02.020, 43.21C.110, and 43.21C.095; adding new sections to chapter 43.21C RCW; adding a new section to chapter 82.02 RCW; creating a new section; and providing an expiration date.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION.  Sec. 1   (1) The legislature recognizes that the rule-based categorical exemption thresholds to chapter 43.21C RCW, found in WAC 197-11-800, have not been updated in recent years, and should be reviewed in light of the increased environmental protections in place under chapters 36.70A and 90.58 RCW, and other laws. It is the intent of the legislature to direct the department of ecology to conduct two phases of rule making over the next two years to increase the thresholds for these categorical exemptions.
     (2) By December 31, 2012, the department of ecology shall update the rule-based categorical exemptions to chapter 43.21C RCW found in WAC 197-11-800 and update the environmental checklist found in WAC 197-11-960. In updating the categorical exemptions, the department of ecology must:
     (a) At a minimum, increase the existing maximum threshold levels for the following project types:
     (i) The construction or location of single-family residential developments;
     (ii) The construction or location of multifamily residential developments;
     (iii) The construction of an agricultural structure, other than a feed lot, that is similar to the following: A barn, a loafing shed, a farm equipment storage building, or a produce storing or packing structure;
     (iv) The construction of the following, including any associated parking areas or facilities: An office, a school, a commercial building, a recreational building, a service building, or a storage building;
     (v) Landfilling or excavation activities; and
     (vi) The installation of an electric facility, lines, equipment, or appurtenances, other than substations.
     (b) Establish maximum exemption levels for action types that differ based on whether the project is proposed to occur in:
     (i) An incorporated city;
     (ii) An unincorporated area within an urban growth area;
     (iii) An unincorporated area outside of an urban growth area but within a county planning under chapter 36.70A RCW; or
     (iv) An unincorporated area within a county not planning under chapter 36.70A RCW.
     (c) In updating the environmental checklist found in WAC 197-11-960, the department of ecology shall:
     (i) Reduce duplication in the checklist that has occurred due to subsequent amendments to chapter 43.21C RCW and chapter 197-11 WAC that have occurred since the checklist was last updated; and
     (ii) Not include any new subjects into the scope of the checklist.
     (d) Until the completion of the rule making required under this section, any actions located within a city or a city's urban growth area may apply the highest categorical exemption levels authorized under WAC 197-11-800, regardless if the city or county with jurisdiction has exercised its authority to raise the exemption levels above the established minimums, unless the city or county with jurisdiction passes an ordinance or resolution that lowers the exemption levels to a level below the allowed maximum but not less than the default minimum levels detailed in WAC 197-11-800.
     (3) By December 31, 2013, the department of ecology shall update the thresholds for all other project actions not specified in subsection (2) of this section and create a categorical exemption for projects designed to restore natural wildlife or fishery habitats or serve as environmental mitigation for other projects. During this process, the department of ecology may also review and update the thresholds resulting from the 2012 rule-making process outlined in subsection (2) of this section.
     (4) For both rule-making processes under subsections (2) and (3) of this section, the department of ecology shall:
     (a) Convene an advisory committee consisting of members representing, at minimum, cities, counties, business interests, environmental interests, agricultural interests, cultural resources interests, state agencies, and tribal governments to assist in updating the environmental checklist and updating the thresholds for other project actions; and
     (b) Consider opportunities to ensure that state agencies and other interested parties can continue to receive notice about projects of interest through a means other than through notice under chapter 43.21C RCW.
     (5) This section expires July 31, 2013.

Sec. 2   RCW 43.21C.031 and 1995 c 347 s 203 are each amended to read as follows:
     (1) An environmental impact statement (the detailed statement required by RCW 43.21C.030(2)(c)) shall be prepared on proposals for legislation and other major actions having a probable significant, adverse environmental impact. The environmental impact statement may be combined with the recommendation or report on the proposal or issued as a separate document. The substantive decisions or recommendations shall be clearly identifiable in the combined document. Actions categorically exempt under RCW 43.21C.110(1)(a) do not require environmental review or the preparation of an environmental impact statement under this chapter. ((In a county, city, or town planning under RCW 36.70A.040, a planned action, as provided for in subsection (2) of this section, does not require a threshold determination or the preparation of an environmental impact statement under this chapter, but is subject to environmental review and mitigation as provided in this chapter.))
     (2) An environmental impact statement is required to analyze only those probable adverse environmental impacts which are significant. Beneficial environmental impacts may be discussed. The responsible official shall consult with agencies and the public to identify such impacts and limit the scope of an environmental impact statement. The subjects listed in RCW 43.21C.030(2)(c) need not be treated as separate sections of an environmental impact statement. Discussions of significant short-term and long-term environmental impacts, significant irrevocable commitments of natural resources, significant alternatives including mitigation measures, and significant environmental impacts which cannot be mitigated should be consolidated or included, as applicable, in those sections of an environmental impact statement where the responsible official decides they logically belong.
     (((2)(a) For purposes of this section, a planned action means one or more types of project action that:
     (i) Are designated planned actions by an ordinance or resolution adopted by a county, city, or town planning under RCW 36.70A.040;
     (ii) Have had the significant impacts adequately addressed in an environmental impact statement prepared in conjunction with (A) a comprehensive plan or subarea plan adopted under chapter 36.70A RCW, or (B) a fully contained community, a master planned resort, a master planned development, or a phased project;
     (iii) Are subsequent or implementing projects for the proposals listed in (a)(ii) of this subsection;
     (iv) Are located within an urban growth area, as defined in RCW 36.70A.030;
     (v) Are not essential public facilities, as defined in RCW 36.70A.200; and
     (vi) Are consistent with a comprehensive plan adopted under chapter 36.70A RCW.
     (b) A county, city, or town shall limit planned actions to certain types of development or to specific geographical areas that are less extensive than the jurisdictional boundaries of the county, city, or town and may limit a planned action to a time period identified in the environmental impact statement or the ordinance or resolution adopted under this subsection.))

Sec. 3   RCW 43.21C.087 and 1974 ex.s. c 179 s 14 are each amended to read as follows:
     (1) The department of ecology shall prepare a list of all filings required by RCW 43.21C.080 each week and shall make such list available to any interested party. The list of filings shall include a brief description of the governmental action and the project involved in such action, along with the location of where information on the project or action may be obtained. Failure of the department to include any project or action shall not affect the running of the statute of limitations provided in RCW 43.21C.080.
     (2) The department of ecology shall accept electronic submittal of all required filings from lead agencies under this section.

NEW SECTION.  Sec. 4   A new section is added to chapter 43.21C RCW to read as follows:
     (1) For purposes of this chapter, a planned action means one or more types of development or redevelopment that meet the following criteria:
     (a) Are designated as planned actions by an ordinance or resolution adopted by a county, city, or town planning under RCW 36.70A.040;
     (b) Have had the significant impacts adequately addressed in an environmental impact statement under the requirements of this chapter in conjunction with, or to implement, a comprehensive plan or subarea plan adopted under chapter 36.70A RCW, or a fully contained community, a master planned resort, a master planned development, or a phased project;
     (c) Are subsequent or implementing projects for the proposals listed in (b) of this subsection;
     (d) Are located within an urban growth area designated pursuant to RCW 36.70A.110;
     (e) Are not essential public facilities, as defined in RCW 36.70A.200, unless an essential public facility is accessory to or part of a residential, office, school, commercial, recreational, service, or industrial development that is designated a planned action under this subsection; and
     (f) Are consistent with a comprehensive plan or subarea plan adopted under chapter 36.70A RCW.
     (2) A county, city, or town shall define the types of development included in the planned action and may limit a planned action to:
     (a) A specific geographic area that is less extensive than the jurisdictional boundaries of the county, city, or town; or
     (b) A time period identified in the ordinance or resolution adopted under this subsection.
     (3)(a) A county, city, or town shall determine during permit review whether a proposal is consistent with a planned action ordinance adopted by the jurisdiction. To determine project consistency with a planned action ordinance, a county, city, or town may utilize a modified checklist pursuant to the rules adopted to implement RCW 43.21C.110, a form that is designated within the planned action ordinance, or a form contained in agency rules adopted pursuant to RCW 43.21C.120.
     (b) Except for impacts that are specifically deferred for consideration at the project level, a county, city, or town is not required to make a threshold determination and may not require additional environmental review for a proposal that is determined to be consistent with the development or redevelopment described in the planned action ordinance. The determination of consistency, and the adequacy of any environmental review that was specifically deferred, is subject to any administrative appeal that the county, city, or town provides consistent with RCW 36.70B.060.
     (4) For a planned action that encompasses the entire jurisdictional boundary of a county, city, or town, at least one community meeting must be held before the scoping notice for such a planned action is issued. Notice of scoping for such a planned action and notice of the community meeting required by this subsection must be mailed to:
     (a) All property owners of record within the county, city, or town;
     (b) All affected federally recognized tribal governments whose ceded area is within one-half mile of the jurisdictional boundaries of the county, city, or town, and to agencies with jurisdiction over the future development anticipated for the planned action.

Sec. 5   RCW 43.21C.229 and 2003 c 298 s 1 are each amended to read as follows:
     (1) In order to accommodate infill development and thereby realize the goals and policies of comprehensive plans adopted according to chapter 36.70A RCW, a city or county planning under RCW 36.70A.040 is authorized by this section to establish categorical exemptions from the requirements of this chapter. An exemption adopted under this section applies even if it differs from the categorical exemptions adopted by rule of the department under RCW 43.21C.110(1)(a) and section 1 of this act. An exemption may be adopted by a city or county under this section if it meets the following criteria:
     (a) It categorically exempts government action related to development ((that is new residential or mixed-use development)) proposed to fill in an urban growth area, designated according to RCW 36.70A.110, where current density and intensity of use in the area is lower than called for in the goals and policies of the applicable comprehensive plan and the development is either new:
     (i) Residential development; or
     (ii) Mixed-use development;
     (b) It does not exempt government action related to development that would be for a use or would exceed the density or intensity of use called for in the goals and policies of the applicable comprehensive plan; and
     (c)(i) The city or county's applicable comprehensive plan was previously subjected to environmental analysis through an environmental impact statement under the requirements of this chapter prior to adoption; or
     (ii) The city has prepared an environmental impact statement for the area where the exemption created by this section applies if the underlying environmental impact statement considered the proposed use or intensity of use.
     (2) Any categorical exemption adopted by a city or county under this section shall be subject to the rules of the department adopted according to RCW 43.21C.110(1)(a) and section 1 of this act that provide exceptions to the use of categorical exemptions adopted by the department.

NEW SECTION.  Sec. 6   A new section is added to chapter 43.21C RCW to read as follows:
     (1) The legislature recognizes that a county, city, or town that prepares a nonproject environmental review under RCW 43.21C.030(2), including reviews necessary for compliance with RCW 43.21C.420, must endure a substantial financial burden.
     (2) A county, city, or town may recover reasonable expenses incurred by the preparation of a nonproject environmental impact statement prepared under RCW 43.21C.030(2):
     (a) Through access to financial assistance under RCW 36.70A.490;
     (b) With funding from private sources; and
     (c) By the assessment of a reasonable and proportionate fee upon subsequent development that is consistent with the plan and development regulations adopted under RCW 43.21C.030(2), as long as the development makes use of and benefits from, as described in RCW 43.21C.030(2), the nonproject environmental review prepared by the county, city, or town.
     (3) In order to collect fees under this section, the county, city, or town must enact an ordinance that sets forth objective standards for determining how the fees to be imposed upon each development will be proportionate to the impacts of each development and to the benefits accruing to each development from the nonproject environmental review.
     (4) Any assessment of fees collected under this section from subsequent development may be used to reimburse funding received from private sources.
     (5)(a) Any disagreement about the reasonableness or amount of the fees imposed upon a development may not be the basis for delay in issuance of a project permit for that development.
     (b) The fee assessed by the county, city, or town may be paid with the written stipulation "paid under protest" and, if the city provides for an administrative appeal of its decision on the project for which the fees are imposed, any dispute about the amount of the fees must be resolved in the same administrative appeal process.

Sec. 7   RCW 43.21C.420 and 2010 c 153 s 2 are each amended to read as follows:
     (1) Cities with a population greater than five thousand, in accordance with their existing comprehensive planning and development regulation authority under chapter 36.70A RCW, and in accordance with this section, may adopt optional elements of their comprehensive plans and optional development regulations that apply within specified subareas of the cities, that are either:
     (a) Areas designated as mixed-use or urban centers in a land use or transportation plan adopted by a regional transportation planning organization; or
     (b) Areas within one-half mile of a major transit stop that are zoned to have an average minimum density of fifteen dwelling units or more per gross acre.
     (2) Cities located on the east side of the Cascade mountains and located in a county with a population of two hundred thirty thousand or less, in accordance with their existing comprehensive planning and development regulation authority under chapter 36.70A RCW, and in accordance with this section, may adopt optional elements of their comprehensive plans and optional development regulations that apply within the mixed-use or urban centers. The optional elements of their comprehensive plans and optional development regulations must enhance pedestrian, bicycle, transit, or other nonvehicular transportation methods.
     (3) A major transit stop is defined as:
     (a) A stop on a high capacity transportation service funded or expanded under the provisions of chapter 81.104 RCW;
     (b) Commuter rail stops;
     (c) Stops on rail or fixed guideway systems, including transitways;
     (d) Stops on bus rapid transit routes or routes that run on high occupancy vehicle lanes; or
     (e) Stops for a bus or other transit mode providing fixed route service at intervals of at least thirty minutes during the peak hours of operation.
     (4)(a) A city that elects to adopt such an optional comprehensive plan element and optional development regulations shall prepare a nonproject environmental impact statement, pursuant to RCW 43.21C.030, assessing and disclosing the probable significant adverse environmental impacts of the optional comprehensive plan element and development regulations and of future development that is consistent with the plan and regulations.
     (b) At least one community meeting must be held on the proposed subarea plan before the scoping notice for such a nonproject environmental impact statement is issued. Notice of scoping for such a nonproject environmental impact statement and notice of the community meeting required by this section must be mailed to all property owners of record within the subarea to be studied, to all property owners within one hundred fifty feet of the boundaries of such a subarea, to all affected federally recognized tribal governments whose ceded area is within one-half mile of the boundaries of the subarea, and to agencies with jurisdiction over the future development or its impacts anticipated within the subarea.
     (c) In cities with over five hundred thousand residents, notice of scoping for such a nonproject environmental impact statement and notice of the community meeting required by this section must be mailed to all small businesses as defined in RCW 19.85.020, and to all community preservation and development authorities established under chapter 43.167 RCW, located within the subarea to be studied or within one hundred fifty feet of the boundaries of such subarea. The process for community involvement must have the goal of fair treatment and meaningful involvement of all people with respect to the development and implementation of the subarea planning process.
     (d) The notice of the community meeting must include general illustrations and descriptions of buildings generally representative of the maximum building envelope that will be allowed under the proposed plan and indicate that future appeals of proposed developments that are consistent with the plan will be limited. Notice of the community meeting must include signs located on major travel routes in the subarea. If the building envelope increases during the process, another notice complying with the requirements of this section must be issued before the next public involvement opportunity.
     (e) Any person that has standing to appeal the adoption of this subarea plan or the implementing regulations under RCW 36.70A.280 has standing to bring an appeal of the nonproject environmental impact statement required by this subsection.
     (f) Cities with over five hundred thousand residents shall prepare a study that accompanies or is appended to the nonproject environmental impact statement, but must not be part of that statement, that analyzes the extent to which the proposed subarea plan may result in the displacement or fragmentation of existing businesses, existing residents, including people living with poverty, families with children, and intergenerational households, or cultural groups within the proposed subarea plan. The city shall also discuss the results of the analysis at the community meeting.
     (g) As an incentive for development authorized under this section, a city shall consider establishing a transfer of development rights program in consultation with the county where the city is located, that conserves county-designated agricultural and forest land of long-term commercial significance. If the city decides not to establish a transfer of development rights program, the city must state in the record the reasons for not adopting the program. The city's decision not to establish a transfer of development rights program is not subject to appeal. Nothing in this subsection (4)(g) may be used as a basis to challenge the optional comprehensive plan or subarea plan policies authorized under this section.
     (5)(a) Until July 1, 2018, a proposed development that is consistent with the optional comprehensive plan or subarea plan policies and development regulations adopted under subsection (1) or (2) of this section and that is environmentally reviewed under subsection (4) of this section may not be challenged in administrative or judicial appeals for noncompliance with this chapter as long as a complete application for such a development that vests the application or would later lead to vested status under city or state law is submitted to the city within a time frame established by the city, but not to exceed ten years from the date of issuance of the final environmental impact statement.
     (b) After July 1, 2018, the immunity from appeals under this chapter of any application that vests or will vest under this subsection or the ability to vest under this subsection is still valid, provided that the final subarea environmental impact statement is issued by July 1, 2018. ((After July 1, 2018, a city may continue to collect reimbursement fees under subsection (6) of this section for the proportionate share of a subarea environmental impact statement issued prior to July 1, 2018.))
     (6) ((It is recognized that a city that prepares a nonproject environmental impact statement under subsection (4) of this section must endure a substantial financial burden. A city may recover its reasonable expenses of preparation of a nonproject environmental impact statement prepared under subsection (4) of this section through access to financial assistance under RCW 36.70A.490 or funding from private sources. In addition, a city is authorized to recover a portion of its reasonable expenses of preparation of such a nonproject environmental impact statement by the assessment of reasonable and proportionate fees upon subsequent development that is consistent with the plan and development regulations adopted under subsection (5) of this section, as long as the development makes use of and benefits [from], as described in subsection (5) of this section, from the nonproject environmental impact statement prepared by the city. Any assessment fees collected from subsequent development may be used to reimburse funding received from private sources. In order to collect such fees, the city must enact an ordinance that sets forth objective standards for determining how the fees to be imposed upon each development will be proportionate to the impacts of each development and to the benefits accruing to each development from the nonproject environmental impact statement. Any disagreement about the reasonableness or amount of the fees imposed upon a development may not be the basis for delay in issuance of a project permit for that development. The fee assessed by the city may be paid with the written stipulation "paid under protest" and if the city provides for an administrative appeal of its decision on the project for which the fees are imposed, any dispute about the amount of the fees must be resolved in the same administrative appeal process.
     (7))) If a proposed development is inconsistent with the optional comprehensive plan or subarea plan policies and development regulations adopted under subsection (1) of this section, the city shall require additional environmental review in accordance with this chapter.

NEW SECTION.  Sec. 8   A new section is added to chapter 43.21C RCW to read as follows:
     The following nonproject actions are categorically exempt from the requirements of this chapter:
     (1) Amendments to development regulations that are required to ensure consistency with an adopted comprehensive plan pursuant to RCW 36.70A.040, where the comprehensive plan was previously subjected to environmental review pursuant to this chapter;
     (2) Amendments to development regulations that are required to ensure consistency with a shoreline master program approved pursuant to RCW 90.58.090, where the shoreline master program was previously subjected to environmental review pursuant to this chapter;
     (3) Amendments to development regulations that, upon implementation of a project action, will provide increased environmental protection, limited to the following:
     (a) Increased protections for critical areas, such as enhanced buffers or setbacks;
     (b) Increased vegetation retention or decreased impervious surface areas in shoreline jurisdiction; and
     (c) Increased vegetation retention or decreased impervious surface areas in critical areas;
     (4) Amendments to technical codes adopted by a county, city, or town to ensure consistency with minimum standards contained in state law, including the following:
     (a) Building codes required by chapter 19.27 RCW;
     (b) Energy codes required by chapter 19.27A RCW; and
     (c) Electrical codes required by chapter 19.28 RCW.

NEW SECTION.  Sec. 9   A new section is added to chapter 43.21C RCW to read as follows:
     (1) The lead agency for an environmental review under this chapter utilizing an environmental checklist developed by the department of ecology pursuant to RCW 43.21C.110 may satisfy the requirements of the checklist by identifying instances where questions on the checklist are adequately covered by a locally adopted ordinance, development regulation, land use plan, or other legal authority.
     (2) In instances where the locally adopted ordinance, development regulation, land use plan, or other legal authority provide the necessary information to answer a specific question, the lead agency must explain how the proposed project satisfies the underlying local legal authority.
     (3) If the lead agency identifies instances where questions on the checklist are adequately covered by a locally adopted ordinance, development regulation, land use plan, or other legal authority, an applicant may still provide answers to any questions on the checklist.
     (4) Nothing in this section authorizes a lead agency to ignore or delete a question on the checklist.
     (5) Nothing in this section affects the appeal provisions provided in this chapter.
     (6) Nothing in this section modifies existing rules for determining the lead agency, as defined in WAC 197-11-922 through 197-11-948, nor does it modify agency procedures for complying with the state environmental policy act when an agency other than a local government is serving as the lead agency.

Sec. 10   RCW 36.70A.490 and 1995 c 347 s 115 are each amended to read as follows:
     The growth management planning and environmental review fund is hereby established in the state treasury. Moneys may be placed in the fund from the proceeds of bond sales, tax revenues, budget transfers, federal appropriations, gifts, or any other lawful source. Moneys in the fund may be spent only after appropriation. Moneys in the fund shall be used to make grants or loans to local governments for the purposes set forth in RCW 43.21C.240, 43.21C.031, or 36.70A.500. Any payment of either principal or interest, or both, derived from loans made from this fund must be deposited into the fund.

Sec. 11   RCW 36.70A.500 and 1997 c 429 s 28 are each amended to read as follows:
     (1) The department of ((community, trade, and economic development)) commerce shall provide management services for the growth management planning and environmental review fund created by RCW 36.70A.490. The department shall establish procedures for fund management. The department shall encourage participation in the grant or loan program by other public agencies. The department shall develop the grant or loan criteria, monitor the grant or loan program, and select grant or loan recipients in consultation with state agencies participating in the grant or loan program through the provision of grant or loan funds or technical assistance.
     (2) A grant or loan may be awarded to a county or city that is required to or has chosen to plan under RCW 36.70A.040 and that is qualified pursuant to this section. The grant or loan shall be provided to assist a county or city in paying for the cost of preparing an environmental analysis under chapter 43.21C RCW, that is integrated with a comprehensive plan, subarea plan, plan element, countywide planning policy, development regulation, monitoring program, or other planning activity adopted under or implementing this chapter that:
     (a) Improves the process for project permit review while maintaining environmental quality; or
     (b) Encourages use of plans and information developed for purposes of complying with this chapter to satisfy requirements of other state programs.
     (3) In order to qualify for a grant or loan, a county or city shall:
     (a) Demonstrate that it will prepare an environmental analysis pursuant to chapter 43.21C RCW and subsection (2) of this section that is integrated with a comprehensive plan, subarea plan, plan element, countywide planning policy, development regulations, monitoring program, or other planning activity adopted under or implementing this chapter;
     (b) Address environmental impacts and consequences, alternatives, and mitigation measures in sufficient detail to allow the analysis to be adopted in whole or in part by applicants for development permits within the geographic area analyzed in the plan;
     (c) Demonstrate that procedures for review of development permit applications will be based on the integrated plans and environmental analysis;
     (d) Include mechanisms to monitor the consequences of growth as it occurs in the plan area and to use the resulting data to update the plan, policy, or implementing mechanisms and associated environmental analysis;
     (e) Demonstrate substantial progress towards compliance with the requirements of this chapter. A county or city that is more than six months out of compliance with a requirement of this chapter is deemed not to be making substantial progress towards compliance; and
     (f) Provide local funding, which may include financial participation by the private sector.
     (4) In awarding grants or loans, the department shall give preference to proposals that include one or more of the following elements:
     (a) Financial participation by the private sector, or a public/private partnering approach;
     (b) Identification and monitoring of system capacities for elements of the built environment, and to the extent appropriate, of the natural environment;
     (c) Coordination with state, federal, and tribal governments in project review;
     (d) Furtherance of important state objectives related to economic development, protection of areas of statewide significance, and siting of essential public facilities;
     (e) Programs to improve the efficiency and effectiveness of the permitting process by greater reliance on integrated plans and prospective environmental analysis;
     (f) Programs for effective citizen and neighborhood involvement that contribute to greater likelihood that planning decisions can be implemented with community support; ((and))
     (g) Programs to identify environmental impacts and establish mitigation measures that provide effective means to satisfy concurrency requirements and establish project consistency with the plans; or
     (h) Environmental review that addresses the impacts of increased density or intensity of comprehensive plans, subarea plans, or receiving areas designated by a city or town under the regional transfer of development rights program in chapter 43.362 RCW.
     (5) If the local funding includes funding provided by other state functional planning programs, including open space planning and watershed or basin planning, the functional plan shall be integrated into and be consistent with the comprehensive plan.
     (6) State agencies shall work with grant or loan recipients to facilitate state and local project review processes that will implement the projects receiving grants or loans under this section.

NEW SECTION.  Sec. 12   A new section is added to chapter 82.02 RCW to read as follows:
     (1) The legislature finds that:
     (a) Detailed environmental analysis integrated with comprehensive plans, subarea plans, and development regulations will facilitate planning for and managing growth, allow greater protection of the environment, and benefit both the general public and private property owners;
     (b) Compact development in urban growth areas, or transfer of development rights programs, will assist in the conservation of rural, agricultural, and forest land by redirecting growth from this land to areas designated for compact development or receiving areas in cities and towns where growth should occur;
     (c) Cities and towns planning for increased growth in receiving areas under chapter 43.362 RCW must comply with chapter 43.21C RCW;
     (d) Planning for compact or increased growth in urban growth areas, or receiving areas under chapter 43.362 RCW in compliance with chapter 43.21C RCW, presents a financial burden on cities and towns;
     (e) Planning for compact or increased growth in urban growth areas, or receiving areas under chapter 43.362 RCW in compliance with chapter 43.21C RCW, should be encouraged to ensure that the quality of life in receiving neighborhoods and the protection of environmental values over time are maintained by providing financial assistance through the growth management planning and environmental review fund created in RCW 36.70A.490;
     (f) Access to financial assistance through the growth management planning and environmental review fund created in RCW 36.70A.490 may be increased by allowing the fund to become a revolving loan program rather than only a grant program; and
     (g) Counties, cities, and towns will have the ability to repay loans from the growth management planning and environmental review fund created in RCW 36.70A.490, or recoup their own costs associated with environmental review conducted at a comprehensive plan or subarea plan level, with fees they collect from developers who will benefit from the environmental review that the city or county has already conducted under chapter 43.21C RCW on a comprehensive plan or subarea plan, or in conjunction with the designation of a receiving area under chapter 43.362 RCW, and that addresses the impacts of compact development or projects using transferable development rights.
     (2) Counties, cities, and towns that conduct detailed environmental review under chapter 43.21C RCW, integrated with a comprehensive plan or subarea plan within urban growth areas, are authorized to impose environmental fees on development activity as part of the financing for environmental review conducted under chapter 43.21C RCW on a comprehensive plan or subarea plan.
     (3) The environmental fees:
     (a) May only be imposed for environmental review costs that have been identified as reasonably related to the new development;
     (b) May not exceed the proportionate share of the costs of environmental review conducted for a comprehensive plan or subarea plan; and
     (c) May, if applicable, be used to repay a loan from the growth management planning and environmental review fund created in RCW 36.70A.490.

Sec. 13   RCW 82.02.020 and 2010 c 153 s 3 are each amended to read as follows:
     Except only as expressly provided in chapters 67.28, 81.104, and 82.14 RCW, the state preempts the field of imposing retail sales and use taxes and taxes upon parimutuel wagering authorized pursuant to RCW 67.16.060, conveyances, and cigarettes, and no county, town, or other municipal subdivision shall have the right to impose taxes of that nature. Except as provided in RCW 64.34.440, section 12 of this act, and RCW 82.02.050 through 82.02.090, no county, city, town, or other municipal corporation shall impose any tax, fee, or charge, either direct or indirect, on the construction or reconstruction of residential buildings, commercial buildings, industrial buildings, or on any other building or building space or appurtenance thereto, or on the development, subdivision, classification, or reclassification of land. However, this section does not preclude dedications of land or easements within the proposed development or plat which the county, city, town, or other municipal corporation can demonstrate are reasonably necessary as a direct result of the proposed development or plat to which the dedication of land or easement is to apply.
     This section does not prohibit voluntary agreements with counties, cities, towns, or other municipal corporations that allow a payment in lieu of a dedication of land or to mitigate a direct impact that has been identified as a consequence of a proposed development, subdivision, or plat. A local government shall not use such voluntary agreements for local off-site transportation improvements within the geographic boundaries of the area or areas covered by an adopted transportation program authorized by chapter 39.92 RCW. Any such voluntary agreement is subject to the following provisions:
     (1) The payment shall be held in a reserve account and may only be expended to fund a capital improvement agreed upon by the parties to mitigate the identified, direct impact;
     (2) The payment shall be expended in all cases within five years of collection; and
     (3) Any payment not so expended shall be refunded with interest to be calculated from the original date the deposit was received by the county and at the same rate applied to tax refunds pursuant to RCW 84.69.100; however, if the payment is not expended within five years due to delay attributable to the developer, the payment shall be refunded without interest.
     No county, city, town, or other municipal corporation shall require any payment as part of such a voluntary agreement which the county, city, town, or other municipal corporation cannot establish is reasonably necessary as a direct result of the proposed development or plat.
     Nothing in this section prohibits cities, towns, counties, or other municipal corporations from collecting reasonable fees from an applicant for a permit or other governmental approval to cover the cost to the city, town, county, or other municipal corporation of processing applications, inspecting and reviewing plans, or preparing detailed statements required by chapter 43.21C RCW, including reasonable fees that are consistent with ((RCW 43.21C.420(6))) section 6 of this act.
     This section does not limit the existing authority of any county, city, town, or other municipal corporation to impose special assessments on property specifically benefited thereby in the manner prescribed by law.
     Nothing in this section prohibits counties, cities, or towns from imposing or permits counties, cities, or towns to impose water, sewer, natural gas, drainage utility, and drainage system charges. However, no such charge shall exceed the proportionate share of such utility or system's capital costs which the county, city, or town can demonstrate are attributable to the property being charged. Furthermore, these provisions may not be interpreted to expand or contract any existing authority of counties, cities, or towns to impose such charges.
     Nothing in this section prohibits a transportation benefit district from imposing fees or charges authorized in RCW 36.73.120 nor prohibits the legislative authority of a county, city, or town from approving the imposition of such fees within a transportation benefit district.
     Nothing in this section prohibits counties, cities, or towns from imposing transportation impact fees authorized pursuant to chapter 39.92 RCW.
     Nothing in this section prohibits counties, cities, or towns from requiring property owners to provide relocation assistance to tenants under RCW 59.18.440 and 59.18.450.
     Nothing in this section limits the authority of counties, cities, or towns to implement programs consistent with RCW 36.70A.540, nor to enforce agreements made pursuant to such programs.
     This section does not apply to special purpose districts formed and acting pursuant to Title 54, 57, or 87 RCW, nor is the authority conferred by these titles affected.

Sec. 14   RCW 43.21C.110 and 1997 c 429 s 47 are each amended to read as follows:
     It shall be the duty and function of the department of ecology:
     (1) To adopt and amend ((thereafter)) rules of interpretation and implementation of this chapter, subject to the requirements of chapter 34.05 RCW, for the purpose of providing uniform rules and guidelines to all branches of government including state agencies, political subdivisions, public and municipal corporations, and counties. The proposed rules shall be subject to full public hearings requirements associated with rule ((promulgation)) adoption. Suggestions for modifications of the proposed rules shall be considered on their merits, and the department shall have the authority and responsibility for full and appropriate independent ((promulgation and)) adoption of rules, assuring consistency with this chapter as amended and with the preservation of protections afforded by this chapter. The rule-making powers authorized in this section shall include, but shall not be limited to, the following phases of interpretation and implementation of this chapter:
     (a) Categories of governmental actions which are not to be considered as potential major actions significantly affecting the quality of the environment, including categories pertaining to applications for water right permits pursuant to chapters 90.03 and 90.44 RCW. The types of actions included as categorical exemptions in the rules shall be limited to those types which are not major actions significantly affecting the quality of the environment. The rules shall provide for certain circumstances where actions which potentially are categorically exempt require environmental review. An action that is categorically exempt under the rules adopted by the department may not be conditioned or denied under this chapter.
     (b) Rules for criteria and procedures applicable to the determination of when an act of a branch of government is a major action significantly affecting the quality of the environment for which a detailed statement is required to be prepared pursuant to RCW 43.21C.030.
     (c) Rules and procedures applicable to the preparation of detailed statements and other environmental documents, including but not limited to rules for timing of environmental review, obtaining comments, data and other information, and providing for and determining areas of public participation which shall include the scope and review of draft environmental impact statements.
     (d) Scope of coverage and contents of detailed statements assuring that such statements are simple, uniform, and as short as practicable; statements are required to analyze only reasonable alternatives and probable adverse environmental impacts which are significant, and may analyze beneficial impacts.
     (e) Rules and procedures for public notification of actions taken and documents prepared.
     (f) Definition of terms relevant to the implementation of this chapter including the establishment of a list of elements of the environment. Analysis of environmental considerations under RCW 43.21C.030(2) may be required only for those subjects listed as elements of the environment (or portions thereof). The list of elements of the environment shall consist of the "natural" and "built" environment. The elements of the built environment shall consist of public services and utilities (such as water, sewer, schools, fire and police protection), transportation, environmental health (such as explosive materials and toxic waste), and land and shoreline use (including housing, and a description of the relationships with land use and shoreline plans and designations, including population).
     (g) Rules for determining the obligations and powers under this chapter of two or more branches of government involved in the same project significantly affecting the quality of the environment.
     (h) Methods to assure adequate public awareness of the preparation and issuance of detailed statements required by RCW 43.21C.030(2)(c).
     (i) To prepare rules for projects setting forth the time limits within which the governmental entity responsible for the action shall comply with the provisions of this chapter.
     (j) Rules for utilization of a detailed statement for more than one action and rules improving environmental analysis of nonproject proposals and encouraging better interagency coordination and integration between this chapter and other environmental laws.
     (k) Rules relating to actions which shall be exempt from the provisions of this chapter in situations of emergency.
     (l) Rules relating to the use of environmental documents in planning and decision making and the implementation of the substantive policies and requirements of this chapter, including procedures for appeals under this chapter.
     (m) Rules and procedures that provide for the integration of environmental review with project review as provided in RCW 43.21C.240. The rules and procedures shall be jointly developed with the department of ((community, trade, and economic development)) commerce and shall be applicable to the preparation of environmental documents for actions in counties, cities, and towns planning under RCW 36.70A.040. The rules and procedures shall also include procedures and criteria to analyze planned actions under ((RCW 43.21C.031(2))) section 4 of this act and revisions to the rules adopted under this section to ensure that they are compatible with the requirements and authorizations of chapter 347, Laws of 1995, as amended by chapter 429, Laws of 1997. Ordinances or procedures adopted by a county, city, or town to implement the provisions of chapter 347, Laws of 1995 prior to the effective date of rules adopted under this subsection (1)(m) shall continue to be effective until the adoption of any new or revised ordinances or procedures that may be required. If any revisions are required as a result of rules adopted under this subsection (1)(m), those revisions shall be made within the time limits specified in RCW 43.21C.120.
     (2) In exercising its powers, functions, and duties under this section, the department may:
     (a) Consult with the state agencies and with representatives of science, industry, agriculture, labor, conservation organizations, state and local governments, and other groups, as it deems advisable; and
     (b) Utilize, to the fullest extent possible, the services, facilities, and information (including statistical information) of public and private agencies, organizations, and individuals, in order to avoid duplication of effort and expense, overlap, or conflict with similar activities authorized by law and performed by established agencies.
     (3) Rules adopted pursuant to this section shall be subject to the review procedures of chapter 34.05 RCW.

Sec. 15   RCW 43.21C.095 and 1983 c 117 s 5 are each amended to read as follows:
     The rules ((promulgated)) adopted under RCW 43.21C.110 and section 1 of this act shall be accorded substantial deference in the interpretation of this chapter.