AN ACT Relating to local government land use practices; amending RCW 36.70A.010, 36.70A.215, 36.70A.345, 47.80.050, 82.46.010, 43.17.250, 43.160.060, 70.146.070, and 84.14.010; and adding new sections to chapter 36.70A RCW.

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

Sec. 1. RCW 36.70A.010 and 1990 1st ex.s. c 17 s 1 are each amended to read as follows:

The legislature finds that uncoordinated and unplanned growth, together with a lack of common goals expressing the public's interest in the conservation and the wise use of our lands, pose a threat to the environment, sustainable economic development, and the health, safety, and high quality of life enjoyed by residents of this state. It is in the public interest that citizens, communities, local governments, and the private sector cooperate and coordinate with one another in comprehensive land use planning. It is in the public interest to direct growth to urban areas and accommodate housing for all economic segments of the population. To achieve these goals, the legislature finds that communities must plan for the density necessary to accommodate the population growth projected, implement measures to provide the necessary infrastructure, and encourage an adequate supply of housing in urban areas, particularly on lands in proximity to frequent transit service. Further, the legislature finds that it is in the public interest that economic development programs be shared with communities experiencing insufficient economic growth.

NEW SECTION. Sec. 2. A new section is added to chapter 36.70A RCW to read as follows:

In addition to the requirements of RCW 36.70A.210, a county with a population of one million five hundred thousand or more shall address, in its county-wide planning policy, policies that consider the need for affordable housing, such as housing for all economic segments of the population and parameters for its distribution to the urban, unincorporated areas of the county and each of the cities within the county. By December 31, 1999, county-wide planning policies shall incorporate goals for housing production for the county and each city, in ten-year intervals, sufficient to accommodate housing needs based upon twenty-year population growth projected by the office of financial management. Nothing in this section is intended to change the duties of the office of financial management under RCW 43.62.035. New goals shall be established when the office of financial management issues new population projections.

Sec. 3. RCW 36.70A.215 and 1997 c 429 s 25 are each amended to read as follows:

(1) Subject to the limitations in subsection (7) of this section, a county shall adopt, in consultation with its cities, county-wide planning policies to establish a review and evaluation program. This program shall be in addition to the requirements of RCW 36.70A.110, 36.70A.130, and 36.70A.210. In developing and implementing the review and evaluation program required by this section, the county and its cities shall consider information from other appropriate jurisdictions and sources. The purpose of the review and evaluation program shall be to:

(a) Determine whether a county and its cities are achieving urban densities within urban growth areas by comparing growth and development assumptions, targets, and objectives contained in the county-wide planning policies and the county and city comprehensive plans with actual growth and development that has occurred in the county and its cities; and

(b) Identify reasonable measures, other than adjusting urban growth areas, that will be taken to comply with the requirements of this chapter.

(2) The review and evaluation program shall:

(a) Encompass land uses and activities both within and outside of urban growth areas and provide for annual collection of data on urban and rural land uses, development, critical areas, and capital facilities to the extent necessary to determine the quantity and type of land suitable for development, both for residential and employment-based activities;

(b) Provide for evaluation of the data collected under (a) of this subsection every five years as provided in subsection (3) of this section. The first evaluation shall be completed not later than September 1, 2002. The county and its cities may establish in the county-wide planning policies indicators, benchmarks, and other similar criteria to use in conducting the evaluation;

(c) Provide for methods to resolve disputes among jurisdictions relating to the county-wide planning policies required by this section and procedures to resolve inconsistencies in collection and analysis of data; and

(d) Provide for the amendment of the county-wide policies and county and city comprehensive plans as needed to remedy an inconsistency identified through the evaluation required by this section, or to bring these policies into compliance with the requirements of this chapter.

(3) At a minimum, the evaluation component of the program required by subsection (1) of this section shall:

(a) Determine whether there is sufficient suitable land to accommodate the county-wide population projection established for the county pursuant to RCW 43.62.035 and the subsequent population allocations within the county and between the county and its cities and the requirements of RCW 36.70A.110;

(b) Determine the actual density of housing that has been constructed and the actual amount of land developed for commercial and industrial uses within the urban growth area since the adoption of a comprehensive plan under this chapter or since the last periodic evaluation as required by subsection (1) of this section; and

(c) Based on the actual density of development as determined under (b) of this subsection, review commercial, industrial, and housing needs by type and density range to determine the amount of land needed for commercial, industrial, and housing for the remaining portion of the twenty-year planning period used in the most recently adopted comprehensive plan.

(5)(a) Not later than July 1, 1998, the department shall prepare a list of methods used by counties and cities in carrying out the types of activities required by this section. The department shall provide this information and appropriate technical assistance to counties and cities required to or choosing to comply with the provisions of this section.

(b) By December 31, 2007, the department shall submit to the appropriate committees of the legislature a report analyzing the effectiveness of the activities described in this section in achieving the goals envisioned by the county-wide planning policies and the comprehensive plans and development regulations of the counties and cities.

(6) From funds appropriated by the legislature for this purpose, the department shall provide grants to counties, cities, and regional planning organizations required under subsection (7) of this section to conduct the review and perform the evaluation required by this section.

(7) The provisions of this section shall apply to counties, and the cities within those counties, that were greater than one hundred fifty thousand in population in 1995 as determined by office of financial management population estimates and that are located west of the crest of the Cascade mountain range but does not apply to any county with a population of one million five hundred thousand or more nor to the cities within such county. Any other county planning under RCW 36.70A.040 may carry out the review, evaluation, and amendment programs and procedures as provided in this section.

NEW SECTION. Sec. 4. A new section is added to chapter 36.70A RCW to read as follows:

(1) Subject to the limitations in subsection (12) of this section, a county subject to this section shall adopt, in consultation with its cities, county-wide planning policies to establish a review and evaluation program. This program shall be in addition to the requirements of RCW 36.70A.110, 36.70A.130, and 36.70A.210. In developing and implementing the review and evaluation program required by this section, the county and its cities shall consider information from other appropriate jurisdictions and sources. The purpose of the review and evaluation program shall be to:

(a) Determine whether the county and its cities are achieving urban densities within urban growth areas by comparing growth and development assumptions, targets, and objectives contained in the county-wide planning policies and the county and city comprehensive plans and development regulations with actual growth and development that has occurred in the county and its cities;

(b) Determine whether the county and each of its cities are achieving goals established for net new housing units to be produced in ten-year intervals to meet twenty-year household projections, as provided by the county-wide planning policy and comprehensive plan, and are making adequate provision for existing and projected housing needs of all economic segments of the community; and

(c) Identify reasonable measures, other than adjusting urban growth areas, that will be taken to comply with the requirements of this chapter.

(2) The review and evaluation program shall:

(a) Encompass land uses and activities both within and outside of urban growth areas and provide for annual collection and reporting of data to the department on urban and rural land uses, development, critical areas, and capital facilities to the extent necessary to determine the quantity and type of land suitable for development, both for residential and employment-based activities;

(b) Development data collected shall, at a minimum, include:

(i) The number of applications made for residential development, and the number of residential units;

(ii) The number of applications approved, the number of residential units, and density of residential units compared to maximum density allowed on the site;

(iii) The net number of new residential dwelling units;

(iv) The number of applications made for commercial and industrial development;

(v) The number of applications approved for commercial and industrial development, including the square footage and estimated number of employees;

(vi) The estimated net number of new jobs created reported on a biennial basis from existing data;

(vii) An assessment of market factors including a county-wide analysis of housing availability inside and outside urban growth boundaries; and

(viii) An assessment of the availability of public services and facilities to serve the population growth.

(c) Provide for evaluation of the data collected under (a) of this subsection every ten years as provided in subsection (3) of this section. The first evaluation shall be completed not later than September 1, 2002. The county and its cities may establish in the county-wide planning policies indicators, benchmarks, and other similar criteria to use in conducting the evaluation;

(d) Provide for methods to resolve disputes among jurisdictions relating to the county-wide planning policies required by this section and procedures to resolve inconsistencies in collection and analysis of data; and

(e) Provide for the amendment of the county-wide policies and county and city comprehensive plans and development regulations as needed to remedy an inconsistency identified through the evaluation required by this section, or to bring these policies into compliance with the requirements of this chapter.

(3) At a minimum, the evaluation component of the program required by subsection (1) of this section shall:

(a) Require a joint report from the county and its cities regarding regional growth patterns, trends, comparing employment, housing growth, and market conditions; and compiling data on new development;

(b) Determine whether there is sufficient land suitable for development to accommodate the county-wide population projection established for the county pursuant to RCW 43.62.035 and the subsequent population allocations within the county and between the county and its cities and the requirements of RCW 36.70A.110;

(c) Determine the actual density of housing that has been constructed, the actual amount of land developed for commercial and industrial uses within the urban growth area since the adoption of a comprehensive plan under this chapter or since the last periodic evaluation as required by subsection (1) of this section, and the amount of known environmentally sensitive land and public open space that cannot be built upon; and

(d) Based on the actual density of development as determined under (c) of this subsection, review commercial, industrial, and housing needs by type and density range to determine the amount of land needed for commercial, industrial, and housing for the remaining portion of the twenty-year planning period used in the most recently adopted comprehensive plan.

(4) If the evaluation required by subsection (3) of this section demonstrates an inconsistency between what has occurred since the adoption of the county-wide planning policies and the county and city comprehensive plans and development regulations and what was envisioned in those policies and plans and the planning goals and the requirements of this chapter, as the inconsistency relates to the evaluation factors specified in subsection (3) of this section; or demonstrates that the county or any city has fallen short of its ten-year goal for new residential construction by more than fifteen percent, or is not developing per the land use designations and densities planned for the jurisdiction in its comprehensive plan based on the evaluation factors specified in subsection (3) of this section, the county or city shall revise its comprehensive land use plan and development or other regulations as necessary. The county or city not meeting the criteria shall adopt and implement measures within one year or within the next cycle to revise local planning documents that will increase consistency during the subsequent ten-year period and ensure that the jurisdiction can accommodate the residential units necessary for population growth and density projected for the jurisdiction in the county-wide planning policy and its comprehensive plan. If necessary, a county, in consultation with its cities as required by RCW 36.70A.210, shall adopt amendments to county-wide planning policies to increase consistency. Failure to make appropriate changes in the period specified shall make the jurisdiction subject to petition to the growth management hearings board for noncompliance. The county and its cities shall annually monitor the measures adopted under this subsection to determine their effect and may revise or rescind them as appropriate. Measures to accommodate growth include, but are not limited to, the following:

(a) Upzoning or revising zoning designations for land within the boundaries of the jurisdiction in a manner that encourages development to occur at densities sufficient to accommodate residential, commercial, and industrial needs for twenty years; and

(b) Amending the jurisdiction's comprehensive plan or development regulations to include incentive-based measures that encourage development to occur at densities sufficient to accommodate residential, commercial, and industrial needs for twenty years. Incentive-based measures may include, but are not limited to:

(i) Financial incentives and regulatory flexibility for higher density housing;

(ii) Redevelopment and infill strategies;

(iii) Authorization of housing types not previously allowed by the comprehensive plan or development regulations;

(iv) Allowing for subdivisions to achieve lot size reductions;

(v) Encouraging mixed use development through zoning and incentives; and

(vi) Subsidizing fees or taxes for housing accommodating low-income and moderate-income households.

(5) In establishing that actions and measures adopted under subsection (4) of this section encourage development to occur at densities sufficient to accommodate residential, commercial, and industrial needs for twenty years, the county or city shall, at a minimum, demonstrate to the department that all urban land designated for housing and commercial and industrial uses is zoned at density ranges that are demonstrably more likely than not to be achieved by the market.

(6) Amendments to comprehensive plans and development regulations by the county and its cities must comply with this chapter.

(7) On and after the effective date of this act, jurisdictions participating in the review and evaluation program established by this section, and whose zoning is consistent with its comprehensive plan, shall be entitled to incentive provisions to help accommodate growth and achieve goals, including:

(a) Authorization to use their portion of the local option real estate excise tax for capital costs of low-income housing as prescribed by RCW 82.46.010;

(b) Authorization to utilize state funding for "transfer of development rights" banks and amenities to accommodate growth as provided for in the state general fund budget;

(d) Upon achieving growth of not less than fifteen percent below projected goals, additional points shall be granted in funding formulas used to award state grants as prescribed by RCW 43.17.250, 43.160.060, and 70.146.070. Such additional points shall only be considered when comparing grant applications from jurisdictions subject to and in compliance with this section; and

(e) Upon achieving growth of not less than fifteen percent below projected goals, additional points shall be awarded for allocation of transit and transportation funding as prescribed by RCW 47.80.050. Such points shall only be considered when comparing applications from jurisdictions subject to and in compliance with this section.

(8) County-wide planning policies may contain additional incentive provisions and enforcement measures to accommodate growth and achieve housing goals.

(9)(a) Not later than July 1, 1998, the department shall prepare a list of methods used by counties and cities in carrying out the types of activities required by this section. The department shall provide this information and appropriate technical assistance to counties and cities required to or choosing to comply with the provisions of this section.

(b) By December 31, 2003 and 2008, the department shall submit to the appropriate committees of the legislature a report analyzing the effectiveness of the activities described and measures taken by the counties and cities in this section in achieving the goals envisioned by the county-wide planning policies and the comprehensive plans and development regulations of the counties and cities.

(10) From funds appropriated by the legislature for this purpose, the department shall provide grants to counties, cities, and regional planning organizations required under subsection (12) of this section to conduct the review and perform the evaluation required by this section.

(11) For the purposes of this section, "land suitable for development" means all vacant, partially used, redevelopable, or underutilized land that, after taking into account the protection of critical areas, is: (a) Designated for commercial, industrial, or residential use; and (b) not intended for public use.

(12) This section applies only to a county with a population of one million five hundred thousand or more and to any city within such county.

Sec. 5. RCW 36.70A.345 and 1994 c 249 s 33 are each amended to read as follows:

The governor may impose a sanction or sanctions specified under RCW 36.70A.340 on:

(1) A county or city that fails to designate critical areas, agricultural lands, forest lands, or mineral resource lands under RCW 36.70A.170 by the date such action was required to have been taken;

(2) A county or city that fails to adopt development regulations under RCW 36.70A.060 protecting critical areas or conserving agricultural lands, forest lands, or mineral resource lands by the date such action was required to have been taken;

(3) A county that fails to designate urban growth areas under RCW 36.70A.110 by the date such action was required to have been taken; ((~~and~~))

(4) A county or city that fails to adopt its comprehensive plan or development regulations when such actions are required to be taken;

(5) A county or city that fails to provide sufficient land suitable for development to accommodate its share of a county-wide population projection established for the county pursuant to RCW 43.62.035 and the subsequent population allocations within the county and between the county and its cities and the requirements of RCW 36.70A.110;

(6) A county or city that fails to sufficiently plan to accommodate growth, or provide incentive measures as necessary to encourage development to accommodate residential needs, as prescribed in section 4 of this act;

(7) A county or city that fails to achieve not less than fifteen percent below housing goals, or make significant progress toward eliminating housing production obstacles and deficiencies within three years, as prescribed in section 4 of this act;

(8) Subsections (5), (6), and (7) of this section apply only to a county with a population of one million five hundred thousand or more, and any city within such county.

Imposition of a sanction or sanctions under this section shall be preceded by written findings by the governor, that either the county or city is not proceeding in good faith to meet the requirements of the act; or that the county or city has unreasonably delayed taking the required action. The governor shall consult with and communicate his or her findings to the appropriate growth management hearings board prior to imposing the sanction or sanctions. For those counties or cities that are not required to plan or have not opted in, the governor in imposing sanctions shall consider the size of the jurisdiction relative to the requirements of this chapter and the degree of technical and financial assistance provided.

Sec. 6. RCW 47.80.050 and 1990 1st ex.s. c 17 s 57 are each amended to read as follows:

Biennial appropriations to the department of transportation to carry out the regional transportation planning program shall set forth the amounts to be allocated as follows:

(1) A base amount per county for each county within each regional transportation planning organization, to be distributed to the lead planning agency;

(2) An amount to be distributed to each lead planning agency on a per capita basis; ((~~and~~))

(3) An amount to be administered by the department of transportation as a discretionary grant program for special regional planning projects, including grants to allow counties which have significant transportation interests in common with an adjoining region to also participate in that region's planning efforts; and

(4) An amount to be administered by the department of transportation for grants to counties and cities subject to and in compliance with section 4 of this act.

Sec. 7. RCW 82.46.010 and 1994 c 272 s 1 are each amended to read as follows:

(1)(a) The legislative authority of any county or city shall identify in the adopted budget the capital projects funded in whole or in part from the proceeds of the tax authorized in this section, and shall indicate that such tax is intended to be in addition to other funds that may be reasonably available for such capital projects.

(b) The legislative authority of any county with a population of one million five hundred thousand or more and any city within such county shall identify in the adopted budget the capital projects and low-income housing activities funded in whole or in part from the proceeds of the tax authorized in this section, and shall indicate that such tax is intended to be in addition to other funds that may be reasonably available for such capital projects and low-income housing activities.

(2) The legislative authority of any county or any city may impose an excise tax on each sale of real property in the unincorporated areas of the county for the county tax and in the corporate limits of the city for the city tax at a rate not exceeding one-quarter of one percent of the selling price. The revenues from this tax shall be used by any city or county with a population of five thousand or less and any city or county that does not plan under RCW 36.70A.040 for any capital purpose identified in a capital improvements plan and local capital improvements, including those listed in RCW 35.43.040.

((~~After April 30, 1992,~~)) Revenues generated from the tax imposed under this subsection in counties over five thousand population and cities over five thousand population that are required or choose to plan under RCW 36.70A.040 shall be used solely for financing capital projects specified in a capital facilities plan element of a comprehensive plan and housing relocation assistance under RCW 59.18.440 and 59.18.450, except as provided in section 4 of this act for jurisdictions subject to and in compliance with section 4 of this act. However, revenues (a) pledged by such counties and cities to debt retirement prior to April 30, 1992, may continue to be used for that purpose until the original debt for which the revenues were pledged is retired, or (b) committed prior to April 30, 1992, by such counties or cities to a project may continue to be used for that purpose until the project is completed.

(3) In lieu of imposing the tax authorized in RCW 82.14.030(2), the legislative authority of any county or any city may impose an additional excise tax on each sale of real property in the unincorporated areas of the county for the county tax and in the corporate limits of the city for the city tax at a rate not exceeding one-half of one percent of the selling price.

(4) Taxes imposed under this section shall be collected from persons who are taxable by the state under chapter 82.45 RCW upon the occurrence of any taxable event within the unincorporated areas of the county or within the corporate limits of the city, as the case may be. (5) Taxes imposed under this section shall comply with all applicable rules, regulations, laws, and court decisions regarding real estate excise taxes as imposed by the state under chapter 82.45 RCW.

(6) As used in this section((,)):

(a) "City" means any city or town ((~~and~~));

(b) "Capital project" means those public works projects of a local government for planning, acquisition, construction, reconstruction, repair, replacement, rehabilitation, or improvement of streets; roads; highways; sidewalks; street and road lighting systems; traffic signals; bridges; domestic water systems; storm and sanitary sewer systems; parks; recreational facilities; law enforcement facilities; fire protection facilities; trails; libraries; administrative and/or judicial facilities; river and/or waterway flood control projects by those jurisdictions that, prior to June 11, 1992, have expended funds derived from the tax authorized by this section for such purposes; ((and, until December 31, 1995, housing projects for those jurisdictions that, prior to June 11, 1992, have expended or committed to expend funds derived from the tax authorized by this section or the tax authorized by RCW 82.46.035 for such purposes))

(c) "Low-income housing activities" include the capital costs for planning, acquisition, building, improving, or restoring publicly owned low-income housing, granting funds to nonprofit organizations for low-income housing, and other financial aid or grants to individuals or organizations, provided the amounts are dedicated solely to the capital costs for planning, building, improvement, restoration, or provision of low-income housing, from a local government subject to section 4 of this act. A plan for the expenditure of the excise tax proceeds for this purpose shall be prepared by the legislative authority prior to the adoption of this plan, and a public hearing shall be held to obtain public input;

(d) "Low-income housing" means housing provided for low-income households; and

(e) "Low-income household" means a single person, family, or unrelated persons living together whose income is at or below fifty percent of the median income, adjusted for household size, in the county where the low-income housing is located.

Sec. 8. RCW 43.17.250 and 1991 sp.s. c 32 s 25 are each amended to read as follows:

Whenever a state agency is considering awarding grants or loans for a county, city, or town to finance public facilities, it shall consider whether the county, city, or town that is requesting the grant or loan is a party to a county-wide planning policy under RCW 36.70A.210 relating to the type of public facility for which the grant or loan is sought((~~, and~~)); shall accord additional preference to the county, city, or town if such county-wide planning policy exists; and shall grant priority status to any county, city, or town subject to and in compliance with section 4 of this act. Such priority status shall only be granted when comparing grant applications from jurisdictions subject to section 4 of this act. Whenever a state agency is considering awarding grants or loans to a special district for public facilities, it shall consider whether the county, city, or town in whose planning jurisdiction the proposed facility is located is a party to a county-wide planning policy under RCW 36.70A.210 relating to the type of public facility for which the grant or loan is sought.

Sec. 9. RCW 43.160.060 and 1996 c 51 s 5 are each amended to read as follows:

The board is authorized to make direct loans to political subdivisions of the state for the purposes of assisting the political subdivisions in financing the cost of public facilities, including development of land and improvements for public facilities, as well as the construction, rehabilitation, alteration, expansion, or improvement of the facilities. A grant may also be authorized for purposes designated in this chapter, but only when, and to the extent that, a loan is not reasonably possible, given the limited resources of the political subdivision and the finding by the board that unique circumstances exist. The board shall not obligate more than twenty percent of its biennial appropriation as grants.

Application for funds shall be made in the form and manner as the board may prescribe. In making grants or loans the board shall conform to the following requirements:

(1) The board shall not provide financial assistance:

(a) For a project the primary purpose of which is to facilitate or promote a retail shopping development or expansion.

(b) For any project that evidence exists would result in a development or expansion that would displace existing jobs in any other community in the state.

(2) The board shall only provide financial assistance:

(a) For those projects which would result in specific private developments or expansions (i) in manufacturing, production, food processing, assembly, warehousing, and industrial distribution; (ii) for processing recyclable materials or for facilities that support recycling, including processes not currently provided in the state, including but not limited to, de-inking facilities, mixed waste paper, plastics, yard waste, and problem-waste processing; (iii) for manufacturing facilities that rely significantly on recyclable materials, including but not limited to waste tires and mixed waste paper; (iv) which support the relocation of businesses from nondistressed urban areas to distressed rural areas; or (v) which substantially support the trading of goods or services outside of the state's borders.

(b) For projects which it finds will improve the opportunities for the successful maintenance, establishment, or expansion of industrial or commercial plants or will otherwise assist in the creation or retention of long-term economic opportunities.

(c) When the application includes convincing evidence that a specific private development or expansion is ready to occur and will occur only if the public facility improvement is made.

(3) The board shall prioritize each proposed project according to the relative benefits provided to the community by the jobs the project would create, not just the total number of jobs it would create after the project is completed and according to the unemployment rate in the area in which the jobs would be located. As long as there is more demand for financial assistance than there are funds available, the board is instructed to fund projects in order of their priority.

(4) A responsible official of the political subdivision shall be present during board deliberations and provide information that the board requests.

(5) Before any financial assistance application is approved, the political subdivision seeking the assistance must demonstrate to the ((~~community economic revitalization~~)) board that no other timely source of funding is available to it at costs reasonably similar to financing available from the ((~~community economic revitalization~~)) board.

(6) The board shall grant priority status to any political subdivision subject to and in compliance with section 4 of this act. Such priority status shall only be granted when comparing grant applications from jurisdictions subject to section 4 of this act.

Sec. 10. RCW 70.146.070 and 1997 c 429 s 30 are each amended to read as follows:

When making grants or loans for water pollution control facilities, the department shall consider the following:

(1) The protection of water quality and public health;

(2) The cost to residential ratepayers if they had to finance water pollution control facilities without state assistance;

(3) Actions required under federal and state permits and compliance orders;

(4) The level of local fiscal effort by residential ratepayers since 1972 in financing water pollution control facilities;

(5) The extent to which the applicant county or city, or if the applicant is another public body, the extent to which the county or city in which the applicant public body is located, has established programs to mitigate nonpoint pollution of the surface or subterranean water sought to be protected by the water pollution control facility named in the application for state assistance; and

(6) The recommendations of the Puget Sound action team and any other board, council, commission, or group established by the legislature or a state agency to study water pollution control issues in the state.

Except where necessary to address a public health need or substantial environmental degradation, a county, city, or town that is required or chooses to plan under RCW 36.70A.040 may not receive a grant or loan for water pollution control facilities unless it has adopted a comprehensive plan in conformance with the requirements of chapter 36.70A RCW, after it is required that the comprehensive plan be adopted, or unless it has adopted development regulations in conformance with the requirements of chapter 36.70A RCW, after it is required that development regulations be adopted; and, if the applicant county or city is subject to section 4 of this act, it is in compliance with section 4 of this act.

Sec. 11. RCW 84.14.010 and 1997 c 429 s 40 are each amended to read as follows:

Unless the context clearly requires otherwise, the definitions in this section apply throughout this chapter.

(1) "City" means either:

(a) A city or town with a population of at least one hundred thousand ((or));

(b) The largest city or town, if there is no city or town with a population of at least one hundred thousand, located in a county planning under the growth management act; or

(2) "Governing authority" means the local legislative authority of a city having jurisdiction over the property for which an exemption may be applied for under this chapter.

(3) "Growth management act" means chapter 36.70A RCW.

(4) "Multiple-unit housing" means a building having four or more dwelling units not designed or used as transient accommodations and not including hotels and motels. Multifamily units may result from new construction or rehabilitated or conversion of vacant, underutilized, or substandard buildings to multifamily housing.

(5) "Owner" means the property owner of record.

(6) "Permanent residential occupancy" means multiunit housing that provides either rental or owner occupancy on a nontransient basis. This includes owner-occupied or rental accommodation that is leased for a period of at least one month. This excludes hotels and motels that predominately offer rental accommodation on a daily or weekly basis.

(7) "Rehabilitation improvements" means modifications to existing structures, that are vacant for twelve months or longer, that are made to achieve a condition of substantial compliance with existing building codes or modification to existing occupied structures which increase the number of multifamily housing units.

(8) "Residential targeted area" means an area within an urban center that has been designated by the governing authority as a residential targeted area in accordance with this chapter.

(9) "Substantial compliance" means compliance with local building or housing code requirements that are typically required for rehabilitation as opposed to new construction.

(10) "Urban center" means a compact identifiable district where urban residents may obtain a variety of products and services. An urban center must contain:

(a) Several existing or previous, or both, business establishments that may include but are not limited to shops, offices, banks, restaurants, governmental agencies;

(b) Adequate public facilities including streets, sidewalks, lighting, transit, domestic water, and sanitary sewer systems; and

(c) A mixture of uses and activities that may include housing, recreation, and cultural activities in association with either commercial or office, or both, use.