AN ACT Relating to growth management and assessing impact fees for infrastructure development; amending RCW 82.02.020 and 58.17.110; adding a new section to chapter 36.32 RCW; and creating a new section.

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

NEW SECTION. Sec. 1. The legislature intends to assure that taxpayers are no longer unfairly assessed the costs of development of an area by permitting a fair and equitable portion to be assessed through impact fees. It intends to provide for a better base of funding and for mitigating specifically attributable costs of growth and growth development to the infrastructure of cities, towns, and counties, including but not limited to roads, schools, bridges, parks, and recreational facilities. Such impacts may arise directly or indirectly from the development activity itself or from the cumulative impact arising from development activity.

NEW SECTION. Sec. 2. A new section is added to chapter 36.32 RCW to read as follows:

(1) Cities, towns, and counties may impose an impact fee on all residential and commercial development activities to mitigate the potential impacts on their infrastructures and to finance the impacted city, town, or county infrastructure, including but not limited to schools, roads, libraries, civic centers, parks, and recreational facilities.

(2) To impose the impact fee, cities, towns, and counties shall develop impact fee ordinances that are consistent with their comprehensive plans. A formula or other method of developing the amount of the impact fee shall be established for each type of facility.

(3) Only those cities, towns, and counties that have comprehensive plans may impose impact fees on residential and commercial development.

(4) Nothing in this section shall be construed to give an implied right to develop an area merely because an impact fee has been paid.

Sec. 3. Section 82.02.020, chapter 15, Laws of 1961 as last amended by section 6, chapter 179, Laws of 1988 and RCW 82.02.020 are each amended to read as follows:

Except only as expressly provided in RCW 67.28.180 and 67.28.190 and the provisions of chapter 82.14 RCW, the state preempts the field of imposing taxes upon retail sales of tangible personal property, the use of tangible personal property, 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. ((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 pursuant to RCW 58.17.110 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 payments ((~~shall be~~)) or impact fees collected are 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 at the rate applied to judgments to the property owners of record at the time of the refund; 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.

This section does not limit the existing authority of any county, city, town, or other municipal corporation to impose special assessments on property specifically benefitted 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: PROVIDED, That 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: PROVIDED FURTHER, That these provisions shall 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 the imposition of impact fees or excise taxes on residential or commercial development activity to finance schools or infrastructure facilities as authorized in section 1 of this act.

This section does not apply to special purpose districts formed and acting pursuant to Titles 54, 56, 57, or 87 RCW, nor is the authority conferred by these titles affected.

Sec. 4. Section 11, chapter 271, Laws of 1969 ex. sess. as last amended by section 3, chapter 330, Laws of 1989 and RCW 58.17.110 are each amended to read as follows:

(1) The city, town, or county legislative body shall inquire into the public use and interest proposed to be served by the establishment of the subdivision and dedication. It shall determine: (a) If appropriate provisions are made for, but not limited to, the public health, safety, and general welfare, for open spaces, drainage ((~~ways~~)), streets or roads, alleys, other public ways, transit stops or stations, potable water supplies and facilities, sanitary wastes and related facilities, parks and recreational facilities, playgrounds, ((~~sites for~~)) schools, school facilities, and schoolgrounds, and shall consider all other relevant facts, including sidewalks and other planning features that assure safe walking conditions for students who walk to and from school((~~, and determine~~)); and (b) whether the public interest will be served by the subdivision and dedication. ((~~If it finds that the proposed plat makes~~))

(2) A proposed subdivision and dedication may not be approved unless the city, town, or county legislative body makes a written finding that: (a) Appropriate provisions are made for the public health, safety, and general welfare and for such open spaces, drainage ((~~ways~~)), streets or roads, alleys, other public ways, transit stops or stations, potable water supplies and facilities, sanitary wastes and related facilities, parks and recreational facilities, playgrounds, ((~~sites for~~)) schools, school facilities, and schoolgrounds and all other relevant facts, including sidewalks and other planning features that assure safe walking conditions for students who walk to and from school((~~, and that~~)); and (b) the public use and interest will be served by the ((~~platting of such~~)) subdivision((, then it shall be approved. If it finds that the proposed plat does not make such appropriate provisions or that the public use and interest will not be served, then the legislative body may disapprove the proposed plat)) and dedication. Dedication of land to any public body, provision of public facilities, and/or impact fees or excise taxes in lieu of dedications or provision of public facilities, may be required as a condition of subdivision approval and shall be clearly shown on the final plat. The legislative body shall not as a condition to the approval of any ((~~plat~~)) subdivision require a release from damages to be procured from other property owners.