Chapter 12.105
MITIGATION PAYMENT SYSTEM

Sections:

12.105.010    Authority and purpose.

12.105.020    Definitions.

12.105.030    Scope and use of impact fees.

12.105.040    Fee schedules and establishment of service districts.

12.105.050    Calculation of MPS fees.

12.105.060    Multifamily residential MPS fee schedule.

12.105.070    Payment of fees.

12.105.080    Administrative fees.

12.105.090    Administrative fee for preliminary fee calculation.

12.105.100    Project list.

12.105.110    Funding of projects.

12.105.120    Refunds.

12.105.130    Exemptions for schools.

12.105.140    Exemption or reduction for low and moderate income housing.

12.105.150    Request for final decision needed to appeal.

12.105.160    Necessity of compliance.

12.105.010 Authority and purpose.

(1) The Department is authorized to impose transportation impact fees on new development pursuant to the City of Covington’s powers as a noncharter City and Chapters 36.70 and 82.02 RCW.

(2) The purposes of this chapter are to:

(a) Ensure that financial commitments are in place so that adequate transportation facilities are available to serve new growth and development;

(b) Promote orderly growth and development by establishing standards requiring that new growth and development pay a proportionate share of the cost of new transportation facilities needed to serve new growth and development;

(c) Ensure that transportation impact fees are imposed through established procedures and criteria so that specific developments do not pay arbitrary fees or duplicative fees for the same impact;

(d) Implement the transportation policies of the transportation element of the City of Covington comprehensive plan; and

(e) Provide additional funding for growth-related transportation improvements identified by the City of Covington comprehensive plan as reasonable and necessary to meet the future growth needs of the City of Covington. (Ord. 38-02 § 2 (12.75.010))

12.105.020 Definitions.

(1) “Corridor” means the road or set of roads within the City in which vehicle trips to or from a development will take place. Vehicles have flexibility as to an exact route within a corridor but little choice as to whether to use the corridor.

(2) “MPS project” means a growth-related road improvement, which is a system improvement, that is selected by the City of Covington Council for joint private and public funding pursuant to this chapter and that is located:

(a) On a County road in the City of Covington; or

(b) On a City road in an adjacent City or unincorporated area of the County and when the City of Covington has an appropriate interlocal agreement with the adjacent City or County; or

(c) On a State road in the City of Covington once the Washington State Department of Transportation (WSDOT) has adopted procedures that will enable it to plan for and fund growth-related improvements to State roads and once the City of Covington has an appropriate interlocal agreement with WSDOT.

(3) “Project cost” means the estimated cost of developing and constructing an MPS project, including the costs of design and right-of-way acquisition.

(4) “Development improvements” means site improvements and facilities that are planned and designed to provide service for a particular development and that are necessary for the use and convenience of the occupants or users of the development, and are not system improvements. No transportation improvement or facility that is considered a development improvement shall be included in the MPS project list.

(5) “Service district” means geographic area defined by the City, or intergovernmental agreement, in which a defined set of transportation facilities provide service to development within the district. Service districts shall be designated on the basis of sound planning or engineering principles. Development in a service district may, and will likely be found to, impact roadways and intersections both inside and outside the service district, and the MPS fee will reflect a charge for all such impacts. The MPS service districts shall be the MPS zones.

(6) “Traffic impacts” means the diminishment of capacity of a roadway or intersection by the addition of new vehicle trips. Effects of new vehicle trips that are not quantifiable or to the extent that the effects cannot be mitigated fully by the addition of new capacity, such as safety hazards and inadequate signalization, are not traffic impacts for MPS purposes.

(7) “Frontage improvements” or “system improvements” means all improvements in the public right-of-way or in public easements, all improvements required within the proposed public right-of-way of new subdivisions, all improvements intended for ownership, operation, or maintenance by the City, and all other improvements, whether on-site or off-site, for which the Covington Municipal Code requires City approval. (Ord. 03-09 § 1; Ord. 38-02 § 2 (12.75.020))

12.105.030 Scope and use of impact fees.

Impact fees shall:

(1) Only be imposed for transportation improvements that are reasonably related to the traffic impacts of the new development;

(2) Not exceed a proportionate share of the costs of transportation improvements that are reasonably related to the new development;

(3) Be used for transportation improvements that will reasonably benefit the new development;

(4) Not be used to correct existing deficiencies; and

(5) Not be imposed to mitigate the same off-site traffic impacts that are being mitigated pursuant to any other law. (Ord. 38-02 § 2 (12.75.030))

12.105.040 Fee schedules and establishment of service districts.

(1) Fee schedules stating the amount of the MPS fee which residential development shall pay for development subject to MPS fees effective October 4, 1993 [King County Ordinance 11020], are set forth in Attachment B to King County Ordinance 11617 which is incorporated herein by reference as if fully set forth.

Subsequent fee schedules shall be established pursuant to CMC 12.105.050.

All other development shall pay an MPS fee individually calculated by the Department, as set forth in CMC 12.105.050(2). The MPS administrative fee which all developers shall pay is set forth in CMC 12.105.080 and 12.105.090.

(2) For purposes of this chapter, the City is divided into service districts as set forth in Attachment A of King County Ordinance 11617 which is incorporated herein by reference as if fully set forth. In each service district, similar types of residential development shall pay the same MPS fee, unless the amount of the fee is altered because:

(a) Unusual circumstances exist and the Department adjusts the amount of the fee as provided in subsection (3) of this section; or

(b) The developer submits studies or data showing that the fee as set forth in the applicable schedule or as calculated by the Department is in error, as provided in CMC 12.105.150.

(3) The Department may adjust the standard impact fee as set forth in the fee schedules at the time the fee is imposed to consider unusual circumstances in specific cases to ensure that MPS fees are imposed fairly. The Department shall set forth its reasons for adjusting the standard MPS fee in written findings.

(4) Repealed by Ord. 20-07. (Ord. 20-07 § 40; Ord. 38-02 § 2 (12.75.040))

12.105.050 Calculation of MPS fees.

(1) The Department shall calculate the MPS fees set forth in the fee schedules, CMC 12.105.040(1), by means of a computer modeling system that:

(a) Incorporates the service districts adopted in CMC 12.105.040(2);

(b) Within each service district of the City, determines the standard fee for similar types of residential development, which shall be reasonably related to each development’s proportionate share of the cost of the transportation improvement projects being funded by this chapter and shall reasonably reflect the average fee for similar development in the same service district; and

(c) Reduces the proportionate share by applying the benefit factors set forth in this chapter.

(2) When a development’s fee is not determined by the fee schedules adopted in CMC 12.105.040(1), the Department shall calculate the MPS fee by means of a computerized modeling system, which is the same system used to determine the fee schedules, and which:

(a) Determines the development’s proportionate share of the cost of the transportation improvement projects being funded by this chapter; and

(b) Reduces the proportionate share by applying the benefit factors set forth in this chapter.

(3) The Department’s computer model shall calculate proportionate share for use in both fee schedules and individual calculations by:

(a) Determining the number of peak hour vehicle trips generated by development that will benefit from the vehicle capacity added, or to be added, by the road improvements on the MPS project list;

(b) Determining the unit cost of added capacity for each MPS project by dividing the estimated cost of each project by the amount of capacity added; and

(c) Multiplying the number of peak hour trips added to each MPS project by the unit cost of added capacity for those projects.

(4) In calculating proportionate share, the Department’s modeling system shall:

(a) Recognize that a development’s traffic will use a corridor rather than a particular roadway;

(b) Use trip generation rates published by the Institute of Transportation Engineers (ITE) unless:

(i) Actual measurements of the rate of trip generation by similar developments in the Puget Sound region are available, and the Director determines that these local measurements are more accurate; or

(ii) ITE trip generation rates for the proposed development are not available, in which case the Director:

(A) May use published rates from another source; or

(B) May calculate the rate from data about the population of the proposed development; or

(C) May require the developer to obtain actual measurements of trip generation rates by similar developments in the Puget Sound region;

(c) Reduce the trip generation rate to reflect reductions in traffic that will occur because of transportation strategies, as described in the administrative rules for this title;

(d) Identify all roadways and intersections that will be impacted by traffic from each development for as far from the development as the model can measure;

(e) Identify when the capacity of an MPS project has been fully utilized;

(f) Update the data in the model as often as practical, but at least annually;

(g) Estimate the cost of constructing the projects on the MPS project list as of the time they are placed on the list, and then update the cost estimates at least annually, considering the:

(i) Availability of other means of funding transportation facility improvements;

(ii) Cost of existing transportation facility improvements; and

(iii) Methods by which transportation facility improvements were financed;

(h) Update the fee collected against a project, which has already been completed, through an advancement of City funds, at a rate, determined annually, which is equivalent to the City’s return on its investments; and

(i) Charge a development for the total traffic entering and exiting the development during the peak hour.

(5) The Department’s modeling system shall reduce the calculated proportionate share by giving credit for:

(a) Past or future payments made or reasonably anticipated to be made by a development to pay for particular transportation improvements in the form of user fees, debt service payments, taxes or other payments earmarked for or proratable to the same projects being funded by such development’s MPS fee; and

(b) Up to the full amount of the MPS fee, the value of any dedication of land for, improvement to, or new construction of any system improvements provided by the developer to transportation facilities that are identified in the MPS project list; provided, that when an MPS project is constructed on both on-site and off-site land, the Department shall determine, in light of all the circumstances, what proportion of the developer’s costs should fairly and reasonably be attributed to the work done on off-site land. If the value of any dedication of land for, improvement to, or new construction of any system improvements provided by the developer that are identified in the MPS project list exceeds the amount of the developer’s MPS fee, the Department shall not be required to compensate or reimburse the developer for the difference.

(6) The amount of credit determined pursuant to subsection (5)(b) of this section shall be credited proportionately among all the lots in the development, and the MPS fee for each lot for which a building permit is applied shall be reduced accordingly.

(7) The Department shall use the information from the computerized modeling system to prepare an annual draft fee schedule list. The Council shall, as often as is necessary but at least annually, by ordinance establish the fee schedule applicable to each service area in the City by adopting, with or without modification, the Department’s draft fee schedules.

(8) The Department shall present to the Council in administrative rules the proposed changes in the service district boundaries, set forth in CMC 12.105.040(2), as often as is necessary to ensure that the service district boundaries conform to sound planning or engineering principles.

(9) To the extent practical, and in accordance with sound planning or engineering principles, the Department shall develop and propose to the Council for adoption precalculated fee schedules applicable to types of development in addition to residential development. (Ord. 03-09 § 2; Ord. 38-02 § 2 (12.75.050))

12.105.060 Multifamily residential MPS fee schedule.

Fees for multifamily residential dwelling units shall be 60 percent of the fees charged to single-family residential dwelling units. (Ord. 38-02 § 2 (12.75.060))

12.105.070 Payment of fees.

(1) All developers shall pay an MPS fee in accordance with the provisions of this chapter. The fee paid shall be the amount in effect as of the date of building permit issuance. No building permit, or conditional use permit where applicable, for any development requiring payment of an MPS fee pursuant to this chapter shall be issued until the MPS fee has been paid in full.

(2) All developers shall pay an MPS administrative fee at the time of application for a development permit as set forth in CMC 12.105.080 and 12.105.090.

(3) An individually determined MPS fee shall be calculated at the time of application for a development permit, after transmittal to the Department of the information provided by the developer to the Community Development Department. The Department’s determination of the development’s traffic impacts shall be transmitted to the Community Development Department for use in its review pursuant to the State Environmental Policy Act.

(4) The fee as initially calculated after application for a development permit shall be recalculated at the time of payment if the development is modified or conditioned in such a way as to alter the trip generation rate for the development or the development’s total peak hour trips.

(5) Repealed by Ord. 03-09.

(6) A developer may obtain a preliminary determination of the MPS fee before application for a development permit by paying a processing fee pursuant to CMC 12.105.080 and providing the Department with the information needed for processing.

(7) MPS fees may be paid under protest in order to obtain a permit or other approval of development activity. (Ord. 03-09 § 3; amended at request of department 2/08; Ord. 38-02 § 2 (12.75.070))

12.105.080 Administrative fees.

(1) All development permits subject to the MPS fees pursuant to CMC 12.105.070 shall pay an administrative fee as set forth in the current fee resolution.

(2) All development permits which require an individually determined MPS fee pursuant to CMC 12.105.070(3) shall pay an administrative processing fee as set forth in the current fee resolution. (Ord. 38-02 § 2 (12.75.080))

12.105.090 Administrative fee for preliminary fee calculation.

Requests to the Department for a preliminary determination of an MPS fee prepared pursuant to CMC 12.105.070(6) shall be charged the administrative processing fee set forth in CMC 12.105.080. (Ord. 38-02 § 2 (12.75.090))

12.105.100 Project list.

(1) In conjunction with the Department’s annual review and update of the transportation element of the comprehensive plan, the Department shall do the following:

(a) Identify each project that is growth-related and the proportion of each such project that is growth-related;

(b) Forecast the total monies available from taxes and other public sources for road improvements over the multi-year program.

(c) Calculate the amount of MPS fees already paid; and

(d) Identify those MPS projects that have been or are being built but whose performance capacity has not been fully utilized.

(2) The Department shall use this information to prepare an annual draft MPS project list, which shall comprise:

(a) The projects in the comprehensive plan, in order of priority, that are growth-related and that are capable of being funded with the forecast public monies and the MPS fees already paid; and

(b) The MPS projects already built or funded pursuant to this chapter whose performance capacity has not been fully utilized.

(3) The Council, at the same time that it adopts the annual budget and appropriates funds for capital improvement projects, shall by separate ordinance establish the annual MPS project list by adopting, with or without modification, the Department’s draft list.

(4) Once a project is placed on the MPS project list, a fee shall be imposed on every development that impacts the project until the project is removed from the list by one of the following means:

(a) The Council by ordinance removes the project from the MPS project list, in which case the fees already collected will be refunded if necessary to ensure that the MPS fee remains reasonably related to the traffic impacts of development that have paid an MPS fee; provided, that a refund shall not be necessary if the Council transfers the fees to the budget of another project that the Council determines will mitigate essentially the same traffic impacts; or

(b) The capacity created by the project has been fully utilized, in which case the Department shall administratively remove the project from the MPS project list. (Ord. 38-02 § 2 (12.75.100))

12.105.110 Funding of projects.

(1) MPS fees for transportation facility improvements shall be expended only in conformance with the transportation element of the City of Covington comprehensive plan.

(2) MPS projects shall be funded by a balance between MPS fees and other sources of public funds, and shall not be funded solely by MPS fees.

(3) MPS fees shall be expended or encumbered for a permissible use within six years of receipt, unless there exists an extraordinary or compelling reason for fees to be held longer than six years. The Department may recommend to the Council that the City hold fees beyond six years in cases where extraordinary or compelling reasons exist. Such reasons shall be identified in written findings approved by the Council.

(4) The Department and the Council may pool the MPS fees already collected from a development whenever appropriate to help finance a project with high priority among the projects impacted by the development.

(5) The Department shall pool MPS fees whenever necessary to ensure that the fees are expended or encumbered for a permissible use within six years of receipt. Pooling for such purpose shall be accomplished as follows:

(a) The Department shall determine which project has the highest priority among the projects for which MPS fees were collected for each such development, and the Department shall transfer the MPS fees paid by the development to the budget of the project with the highest priority.

(b) The Department shall indicate in the CIP which projects have funds in their budget that have been pooled to ensure that they are expended or encumbered in a timely manner.

(6) The Finance Department shall prepare an annual report on each MPS fee account showing the source and amount of all monies collected, earned or received and transportation improvements that were financed in whole or in part by MPS fees. (Ord. 38-02 § 2 (12.75.110))

12.105.120 Refunds.

(1) A developer may request and shall receive a refund when the developer does not proceed with the development activity for which MPS fees were paid, and the developer shows that no impact has resulted.

However, the MPS administrative fee shall not be refunded.

(2) If a property owner appears to be entitled to a refund of MPS fees, the Department shall notify the property owner by first class mail deposited with the United States Postal Service at their last known address. The property owner must submit a request for a refund to the Council in writing within one year of the date the right to claim the refund arises or the date the notice is given, whichever is later. Any impact fees that are not expended or encumbered within the time limitations established by CMC 12.105.110(5) and for which no application for a refund has been made within this one-year period shall be retained and expended on the projects for which it was collected.

(3) In the event that MPS fees must be refunded for any reason, they shall be refunded with interest earned to the property owners as they appear of record with the assessor at the time of the refund.

(4) When the City seeks to terminate any or all impact fee requirements, all unexpended or unencumbered funds shall be refunded pursuant to this section. Upon the finding that any or all fee requirements are to be terminated, the City shall place notice of such termination and the availability of refunds in a newspaper of general circulation at least two times and shall notify all potential claimants by first class mail to the last known address of claimants. Claimants shall request refunds as in subsection (2) of this section.

All funds available for refund shall be retained for a period of one year. At the end of one year, any remaining funds shall be retained by the City, but must be expended for the indicated road facilities. This notice of requirement shall not apply if there are no unexpended or unencumbered balances within an account or accounts being terminated. (Ord. 38-02 § 2 (12.75.120))

12.105.130 Exemptions for schools.

(1) Public school districts shall be exempted from payment of mitigation payment system fees.

(2) The amount of the MPS fees not collected from school districts shall be paid from public funds other than impact fee accounts. (Ord. 38-02 § 2 (12.75.130))

12.105.140 Exemption or reduction for low and moderate income housing.

(1) Public housing agencies or private nonprofit housing developers participating in publicly sponsored or subsidized housing programs may apply to the Public Works Department for exemptions from MPS fee requirements. The Public Works Department shall review proposed developments of low income or moderate housing by such public or nonprofit developers pursuant to criteria and procedures adopted by administrative rule. If the Community Development Department determines that a proposed development of low or moderate income housing satisfies the adopted criteria, such development shall be exempted from the requirement to pay an MPS fee.

(2) Private developers who dedicate residential units for occupancy by low or moderate income households may apply to the Public Works Department for reductions in MPS fees. The Public Works Department shall review such proposed developments pursuant to criteria and procedures adopted by administrative rule. If the Public Works Department determines that a proposed development satisfies the adopted criteria, the Department shall reduce the calculated MPS fee for the development by an amount that is proportionate to the number of units in the development that satisfy the adopted criteria.

(3) Developers of individual low or moderate income households who are building, contracting to build or siting a house may apply to the Public Works Department for an exemption from MPS fees. The Public Works Department shall review such proposed exemptions pursuant to criteria that include household income and assets, and the cost of the site, site improvements and the housing. The procedures used to evaluate an exception shall be adopted by administrative rule. If the Public Works Department determines that a household qualifies for exemption per the adopted criteria, such individual projects shall be exempted from the requirement to pay the MPS fee.

(4) The amount of the MPS fees not collected from low or moderate income household development shall be paid from public funds other than impact fee accounts.

(5) The Public Works Department is hereby authorized to adopt administrative rules to implement this section. Such rules shall provide for the administration of this program and shall:

(a) Encourage the construction of housing for low or moderate income households by public housing agencies or private nonprofit housing developers participating in publicly sponsored or subsidized housing programs;

(b) Encourage the construction in private developments of housing units for low or moderate income households that are in addition to units required by another housing program or development condition;

(c) Ensure that housing that qualifies as low or moderate cost meets appropriate standards regarding household income, rent levels or sale prices, location, number of units, and development size; and

(d) Ensure that developers who obtain an exemption from or reduction of MPS fees pursuant to subsections (1) and (2) of this section will in fact build the proposed low and moderate cost housing and make it available to low income households for a minimum of 15 years. (Amended at request of department 2/08; Ord. 38-02 § 2 (12.75.140))

12.105.150 Request for final decision needed to appeal.

In order to obtain an appealable final decision the developer must:

(1) Request in writing a review of the fee amount by Department staff. The Department staff shall consider any studies and data submitted by the developer seeking to adjust the amount of the fee; and

(2) Request in writing reconsideration by the Director or the Director’s designee of an adverse decision by staff. Such request for reconsideration shall State in detail the grounds for the request. The Director or the Director’s designee shall issue a final, appealable decision after reviewing the request. (Ord. 38-02 § 2 (12.75.150))

12.105.160 Necessity of compliance.

A development permit issued after the effective date of the MPS provisions of this chapter shall be null and void if issued without substantial compliance with this chapter by the Department, the Public Works Department and the developer. (Amended at request of department 2/08; Ord. 38-02 § 2 (12.75.160))