Chapter 3.71
TRAFFIC IMPACT FEES

Sections:

3.71.010    Purpose.

3.71.020    Definitions.

3.71.030    Applicability.

3.71.040    Exemptions.

3.71.050    Traffic impact fee program elements.

3.71.060    Traffic impact fee technical methods.

3.71.061    Impact rates.

3.71.065    Repealed.

3.71.070    Fee collection.

3.71.075    Deferral of single-family residential impact fees.

3.71.080    Impact fee adjustments.

3.71.090    Impact fee accounts and refunds.

3.71.095    Repealed.

3.71.100    Repealed.

3.71.110    Other authority.

3.71.120    Appeals.

3.71.010 Purpose.

This chapter implements the requirements in RCW 36.70A.070 that cities establish level of service standards for arterial and transit routes and ensure that these standards are met or that funding of adequate improvements is assured before new development is approved. This chapter also implements the provisions in RCW 82.02.050 through 82.02.100 that authorize cities to impose and collect impact fees to partially fund public facilities to accommodate growth. (Ord. 2733 § 1 (Exh. E), 2015; Ord. 2473 § 1, 2006; Ord. 2461 § 1, 2006; Ord. 2145 § 2, 1997. Formerly 18.15.010).

3.71.020 Definitions.

A. “Capital Facilities Element” means that element of the City’s Comprehensive Plan, and its amendments.

B. Repealed by Ord. 2569.

C. Repealed by Ord. 2569.

D. “Comprehensive Plan” means the City of Issaquah Comprehensive Plan adopted by Ordinance No. 2061 on April 17, 1995, including any adopted amendments.

E. “Cost of capacity” means the sum of the costs of all capacity improvements considered divided by the sum of the vehicle trips of capacity added to the City’s arterial system by those same improvements.

F. “Development” means any construction, reconstruction or any use of real property which requires review and approval of a development permit.

G. “Development permit” means any building permit, administrative site development permit, site development permit, short plat application, preliminary plat application, project rezone application or other permit which requires land use review and approval by the City.

H. “Director” means the Director of the Development Services Department, or his/her designee.

I. “Level of service (LOS)” means the relationship between vehicular traffic volumes and roadway capacity, as specified in the City’s Comprehensive Plan.

J. “Affordable housing” means a dwelling unit reserved for occupancy by eligible households and having housing expenses no greater than 30 percent of a given percent of the King County median household income, adjusted for household size, as follows:

Low income affordable housing: Renter-occupied housing affordable to a household earning 50 percent of the King County median income, adjusted for household size, or owner-occupied housing affordable to a household earning 60 percent of King County median income, adjusted for household size.

Mid-moderate income affordable housing: Renter-occupied housing affordable to a household earning 70 percent of the King County median income, adjusted for household size, or owner-occupied housing affordable to a household earning 80 percent of King County median income, adjusted for household size.

Moderate income affordable housing: Renter or owner-occupied housing affordable to a household earning 80 percent of the King County median income, adjusted for household size.

“King County median income” means the median income for the Seattle-Bellevue, WA HUD Metro FMR Area (King County) as most recently determined by the Secretary of Housing and Urban Development (HUD) under Section 8(f)(3) of the United States Housing Act of 1937, as amended. In the event such income determination is no longer published by HUD, the City may use or develop such other reasonable method as it may choose in order to determine the King County median income.

K. “Peak hour” means the 1 hour of highest travel on the City’s arterial street system on an average weekday, typically in the late afternoon/early evening. For purposes of this chapter, this 1-hour peak falls between 4:00 p.m. to 6:00 p.m.

L. “Project cost” means the estimated cost of constructing a City project, including but not limited to the costs of design, right-of-way acquisition and construction.

M. “Proportionate share” means that portion of the cost of public facility improvements and facilities that is reasonably related to the service demands and needs of new development. For any particular development, the proportionate share will depend on the type, size and trip generation rate of the development.

N. “Traffic facilities” includes all publicly owned streets, roads, alleys, and rights-of-way within the City, and street services, traffic control devices, curbs, gutters, sidewalks and related facilities; transit facilities, services and nonmotorized facilities are also included if they are part of a road or street.

O. “Traffic impact” means the highest 1-hour amount of vehicle trips added to the City’s arterial and collector road system by a development at any time during the peak period.

P. “Traffic impact fee” means the payment of money to the City for a proportional share of the cost of traffic facilities needed to serve new development and mitigate the impacts of the development on the City’s traffic facilities.

Q. “Traffic rate study” means the Rate Study for Traffic Impact Fees, dated December 10, 2014. (Ord. 2746 § 6 (Exh. C), 2015; Ord. 2733 § 1 (Exh. E), 2015; Ord. 2569 § 2 (Exh. A), 2009; Ord. 2473 § 2, 2006; Ord. 2461 § 1, 2006; Ord. 2290 § 4, 2000; Ord. 2258 § 1, 1999; Ord. 2145 § 3, 1997. Formerly 18.15.020).

3.71.030 Applicability.

This chapter applies to applications for development permits. (Ord. 2733 § 1 (Exh. E), 2015; Ord. 2461 § 1, 2006; Ord. 2145 § 4, 1997. Formerly 18.15.030).

3.71.040 Exemptions.

A. The following are exempt from the requirements of this chapter:

1. Low, moderate and mid-moderate income affordable housing; provided, that the applicant shall record a City-drafted covenant that prohibits using the affordable housing units for any purpose other than for low, moderate or mid-moderate income affordable housing. At a minimum, the covenant must address price restrictions and household income limits for the low, moderate or mid-moderate income affordable housing, and that if the affordable units are converted to a use other than for low, moderate or mid-moderate income affordable housing, the property owner must pay the applicable impact fees in effect at the time of conversion. Covenants must be recorded with the applicable County Auditor or recording officer. The covenant shall run with the land and apply to subsequent owners and assigns of housing units that receive a low, moderate, or mid-moderate income affordable housing exemption from impact fees. Any claim or request for an exemption under this section shall be made no later than the time of application for a building permit. If a building permit is not required for the development, then the claim shall be made when the first development permit is applied for. Any claim not made when required by this section shall be deemed waived.

2. Buildings or structures constructed by a regional transit authority, pursuant to RCW 82.02.090(1).

3. City Projects. An applicant proposing the development of a City project shall not be assessed a traffic impact fee.

4. The reconstruction of a building destroyed by fire, explosion or other accident when the building size and type after reconstruction are equal to or less than the development before the accident.

5. Accessory Units. A development permit for an accessory unit shall not be assessed a traffic impact fee.

B. A change of use to an existing building is not a measurable impact to public facilities and is therefore not subject to impact fees; provided, that the change of use occurs within 1 year of the prior use. The expansion of a building or a change of use after more than 1 year is subject to this chapter. (Ord. 2839 § 3, 2018; Ord. 2746 § 6 (Exh. C), 2015; Ord. 2733 § 1 (Exh. E), 2015; Ord. 2461 § 1, 2006; Ord. 2405 § 17, 2004; Ord. 2145 § 5, 1997. Formerly 18.15.040).

3.71.050 Traffic impact fee program elements.

A. The City shall mitigate the impacts of new developments on the City’s traffic system by imposing traffic impact fees on every development permit, except as provided in IMC 3.71.040, Exemptions.

B. Any impact fee imposed shall be reasonably related to the impact created by the development and shall not exceed a proportionate share of the cost of system improvements that are reasonably related to the new development.

C. The impact fee imposed may include costs for system improvements previously incurred by the City to the extent that new development will be served by the previously constructed improvements; provided, that such fee shall not be imposed to correct any system improvement deficiencies.

D. The impact fee imposed shall be determined and calculated using the methods established in the Traffic Rate Study.

E. The impact fee calculation shall include a credit for the fair market value of any dedication of land or improvements to land which are listed in the Traffic Rate Study and which are not primarily for the purpose of access to the development or necessary for circulation within the site. The fair market value of the dedication shall be measured at the time of the dedication to the City. (Ord. 2733 § 1 (Exh. E), 2015; Ord. 2569 § 2 (Exh. A), 2009; Ord. 2473 § 3, 2006; Ord. 2461 § 1, 2006; Ord. 2290 § 4, 2000; Ord. 2258 §§ 2, 3, 1999; Ord. 2145 § 6, 1997. Formerly 18.15.050).

3.71.060 Traffic impact fee technical methods.

A. The Traffic Rate Study and other data and information necessary to calculate the impact fee shall be available to the public. Data such as traffic counts, road capacities, and system improvement projects and costs, and resulting fee schedules, will be updated as necessary. Forms and procedures will be established administratively.

B. The Institute of Transportation Engineers Trip Generation Manual, latest edition, or other information where appropriate, shall be used to determine the gross trip generation rate per unit of land use for a proposed development.

C. The gross trip generation rate shall be reduced by a factor that eliminates “pass-by trips” for land uses where such pass-by trips occur, since such trips generate no new vehicle trips on City streets.

D. The final impact fee per unit of land use shall be the number of net new trips generated by the proposed use multiplied by the unit of measure for the use multiplied by the impact fee per unit of measure.

E. The impact fee rates shall be based only on capacity improvements necessary to serve anticipated growth and not those that remove existing capacity deficiencies. In the event that a single capacity improvement project includes elements which serve both existing deficiencies and the needs of growth, the proportion of capacity and cost attributable to existing deficiencies shall not be counted. (Ord. 2733 § 1 (Exh. E), 2015; Ord. 2642 § 1, 2012; Ord. 2607 § 1, 2011; Ord. 2580 § 1, 2010; Ord. 2548 § 4, 2009; Ord. 2473 § 4, 2006; Ord. 2461 § 1, 2006; Ord. 2145 § 7, 1997. Formerly 18.15.060).

*Code reviser’s note: Ordinance 2671 amends Ordinance 2548, Section 9, to provide for the termination of IMC 3.71.060(E) and Section 4 of Ordinance 2548, with the exception of the first sentence, on March 1, 2014.

3.71.061 Impact rates.

A. The impact fee rates listed in Table 4 of the Traffic Rate Study (Exhibit A to the ordinance codified in this section) are based on the methods outlined in IMC 3.71.050 and 3.71.060 and shall be applied to the uses listed in Table 4.

B. The impact fee for any use not listed in Exhibit A, Table 4 shall be determined by the Director using:

1. The impact fee rate for the use listed in Exhibit A, Table 4 most similar to the use not listed; or

2. The trip generation rate for the proposed use from the latest edition of the Trip Generation Manual published by the Institute of Transportation Engineers and the methodology outlined in the Traffic Rate Study and IMC 3.71.050 and 3.71.060 to calculate the impact fee; or

3. Studies and data provided by the applicant and the methodology outlined in the Traffic Rate Study and IMC 3.71.050 and 3.71.060 to calculate the impact fee;

4. The applied impact fee rate may be adjusted in accordance with IMC 3.71.080.

C. The traffic impact fee rates shall be updated annually using the following procedures:

1. The Director shall use the construction cost index published by the Engineering News Record to calculate annual inflation adjustments in the impact fee rates. The traffic impact fees shall not be adjusted for inflation should the construction cost index remain unchanged or decrease in value.

2. The indexed impact fee rates shall be calculated in January, or as soon thereafter as the latest construction cost index information is published by Engineering News Record, and shall become effective immediately thereafter. A copy of the indexed impact fee rates shall be provided to the City Council but the indexed rates shall become effective without further Council review.

D. The Administration shall review the traffic impact fee rates annually to determine when a new traffic impact fee study should be prepared and recommend to the City Council when a new study should be prepared; provided, that the traffic impact fee study shall be updated, generally, at least every 3 years. (Ord. 2761 § 1, 2016; Ord. 2733 § 1 (Exh. E), 2015; Ord. 2548 §§ 2, 5, 2009; Ord. 2473 § 5, 2006).

3.71.065 Technical methods – Reciprocal impact fees.

Repealed by Ord. 2569. (Ord. 2548 § 3, 2009; Ord. 2473 § 6, 2006; Ord. 2461 § 1, 2006; Ord. 2315 § 2, 2001; Ord. 2290 § 4, 2000; Ord. 2258 § 4, 1999. Formerly 18.15.065).

3.71.070 Fee collection.

The traffic impact fee shall be calculated and assessed at the time of issuance of a building permit. Except as provided in IMC 3.71.075, no building permit shall be issued until the impact fee has been paid in full by the applicant; provided, that payment of the impact fee may be phased if the building permit for the development is also phased. The impact fee shall be collected by the City, and maintained in a separate account. (Ord. 2771 § 3, 2016; Ord. 2733 § 1 (Exh. E), 2015; Ord. 2523 § 3, 2008; Ord. 2473 § 7, 2006; Ord. 2461 § 1, 2006; Ord. 2283 § 5, 2000; Ord. 2145 § 8, 1997. Formerly 18.15.070).

3.71.075 Deferral of single-family residential impact fees.

A. An applicant for a building permit for a single-family detached or attached residence may request a deferral of the full impact fee payment until the date of final inspection or 18 months from the date of building permit issuance, whichever occurs first. Deferral of impact fees shall be granted under the conditions set forth in this section.

B. An applicant for deferral must request the deferral at the time of building permit application and must receive the deferral no later than the time of issuance of a building permit. Any request not so made shall be deemed waived.

C. To receive a deferral, an applicant must:

1. Submit a separate application for deferral for each single-family detached or attached residence for which the applicant wishes to defer payment of the impact fees. Each application must be accompanied by the nonrefundable administrative fee established by the City Council in order to reimburse the City for all costs associated with the deferral.

2. Grant and record a deferred impact fee lien against the property in favor of the City in the amount of the deferred impact fee. The deferred impact fee lien must:

a. Be in a form approved by the City;

b. Be signed by all owners of the property, with all signatures acknowledged as required for a deed;

c. Include the legal description, tax account number, and address of the property;

d. Be recorded in King County;

e. Be binding on all successors in title after the recordation; and

f. Be junior and subordinate to 1 mortgage for the purpose of construction granted by the person who applied for the deferral of impact fees.

3. Notice shall be provided within a week of building permit issuance by posting each property using the following notice method:

a. 4-Foot by 4-Foot Board. The responsibility for posting the sign rests with the project applicant. The sign shall be designed as follows:

i. Size. 4-by-4-foot constructed of wood;

ii. Color. Yellow background, black lettering;

iii. Lettering Style. Helvetica or similar style; signs shall be prepared using templates or attachable letters. Hand-lettered signs are not acceptable;

iv. Content of Sign/Notice. The title shall be in 3-inch capital letters, and the remaining sign contents shall be in 1.5-inch upper and lower case (see Permit Center for diagram). The content must include:

(A) The title “NOTICE OF DEFERRED IMPACT FEES”;

(B) “City of Issaquah”;

(C) “Notice that these fees must be paid to the City by the Applicant before house can be occupied”;

(D) The name, address and telephone number of the applicant;

(E) The name, address and telephone number of the Development Services Department;

(F) Other information as the Director/Manager may determine to be necessary to adequately notify potential home owners of the pending requirement;

v. Location. The sign shall be installed:

(A) Midpoint on the street frontage from which the site is addressed or as otherwise directed by the Director/Manager;

(B) At either a location 10 feet back in from the property line or signs which are structurally attached to an existing building shall be exempt from the setback provision; provided, that no sign is located more than 10 feet back from the property line without approval from the Director/Manager; and

(C) The sign must be easily read from the surrounding vicinity and must not be visually obstructed in any way, including, but not limited to, obstruction by vegetation or any other obstruction;

vi. Installation. The sign must be secured to a 4-inch by 4-inch wood post, long enough to set the post 36 inches below grade and back fill with dirt (see Permit Center for diagram);

vii. Certification of Installation. The project applicant must notify the Permit Center that the sign has been posted to proper specifications by submitting a signed “Notification of Sign Installation” to the Permit Center before deferral of impact fees may occur (obtain such forms from the Permit Center);

viii. Maintenance and Signage Removal. The project applicant shall be required to maintain the sign and surrounding area in good condition until 14 days after the deferred impact fees have been paid to the City. Removal of the sign prior to the deferred impact fees being paid may invalidate or postpone any other decision-making or permit process. The sign must be removed by the project applicant no later than 30 days after the deferred impact fees have been paid to the City, and the post holes must be filled to prevent public injury.

D. The amount of the impact fees deferred shall be determined by the fees in effect at the time the applicant applies for a deferral.

E. The City shall withhold final inspection until the impact fees have been paid in full. No temporary certificate of occupancy (TCO) will be granted on a residence that is part of the deferral program. Upon receipt of final payment of impact fees deferred under this subsection, the City shall execute a release of the deferred impact fee lien for each single-family detached or attached residence for which the impact fees have been received. The applicant, or the property owner at the time of the release, shall be responsible for recording the lien release at his or her expense.

F. The extinguishing of a deferred impact fee lien by the foreclosure of a lien having priority does not affect the obligation of the applicant or the property owner to pay the impact fees as a condition of final inspection.

G. If impact fees are not paid in accordance with the deferral and in accordance with the terms and conditions provided in this section, the City may institute foreclosure proceedings in accordance with Chapter 61.12 RCW.

H. Each applicant for a single-family detached or attached residential construction permit, in accordance with his or her contractor registration number or other unique identification number, shall be entitled to annually receive deferrals for the first 20 single-family residential construction building permits. For purposes of this subsection, an “applicant” includes an entity that controls the applicant, is controlled by the applicant, or is under common control with the applicant. (Ord. 2771 § 4, 2016).

3.71.080 Impact fee adjustments.

A. Fees calculated by the City may be adjusted by the Director, if 1 of the following circumstances exists:

1. The applicant demonstrates that an impact fee assessment was improperly calculated; or

2. Studies and data provided by the applicant demonstrate that 1 or more of the factors used to calculate the impact fee may not be appropriate for the particular use.

B. Impact fees may be paid under protest in order to obtain a building permit or other development approval.

C. Any appeal of the decision of the City with regard to traffic impact fee amounts shall follow the process for the appeal of the underlying development permit, as set forth in the Issaquah Land Use Code, and IMC 3.72.120. (Ord. 2733 § 1 (Exh. E), 2015; Ord. 2523 § 3, 2008; Ord. 2473 § 8, 2006; Ord. 2461 § 1, 2006; Ord. 2145 § 9, 1997. Formerly 18.15.080).

3.71.090 Impact fee accounts and refunds.

A. Impact fees shall be retained in a special interest-bearing account established by the City solely for traffic impact fees. All interest shall be retained in the account and expended for the purpose or purposes for which traffic impact fees were imposed. Annually, the City shall prepare a report on the source and amount of all traffic impact fees collected, interest earned, and traffic improvements that were financed in whole or in part by impact fees.

B. Impact fees for the City’s traffic facilities improvements shall be expended by the City only in conformance with the projects listed in the Traffic Rate Study based on the Capital Facilities Element of the Comprehensive Plan.

C. Impact fees shall be expended or encumbered by the City for a permissible use within 10 years of receipt by the City, unless there exists an extraordinary or compelling reason for fees to be held longer than 10 years. Such extraordinary or compelling reasons shall be identified in writing by the City.

D. The current owner of property on which an impact fee has been paid may receive a refund of such fees if the impact fees have not been expended or encumbered by the City for a permissible use within 10 years of receipt of the funds. In determining whether impact fees have been encumbered, impact fees shall be considered encumbered on a first-in, first-out basis.

E. The City shall notify potential claimants by first-class mail deposited with the United States postal service addressed to the owner of the property as shown in the County tax records if an impact fee is not expended or encumbered within 10 years of receipt.

F. An owner’s request for a refund must be submitted to the City in writing within 1 year of the date the right to claim the refund arises or the date that notice is given by the City, whichever date is later. Any impact fees that are not expended or encumbered by the City in conformance with the Capital Facilities Element within these time limitations, and for which no application for a refund has been made within this 1-year period, shall be retained and expended consistent with the provisions of this section. Refunds of impact fees shall include any interest earned on the impact fees.

G. Should the City seek to terminate any or all traffic impact fee requirements, all unexpended or unencumbered funds, including interest earned, shall be refunded to the current owner of the property for which a traffic impact fee was paid. Upon the finding that any or all fee requirements are to be terminated, the City shall place notice of such termination and availability of the refunds in a newspaper of general circulation at least 2 times and shall notify all potential claimants by first-class mail addressed to the owner of the property as shown in the County tax records. All funds available for refund shall be retained for a period of 1 year. At the end of 1 year, any remaining funds shall be retained by the City, and must be expended by the City consistent with the provisions of this section. The notice requirements set forth above shall not apply if there are no unexpended or unencumbered balances within the account or accounts being terminated.

H. An applicant may request and shall receive a refund, including interest earned on the impact fees, when:

1. The applicant does not proceed with construction of the development; and

2. No impact on the City has resulted. “Impact” shall be deemed to include cases where the City has expended or encumbered the impact fees in good faith prior to the application for refund. In the event that the City has expended or encumbered the fees in good faith, no refund shall be forthcoming. However, if, within a period of 3 years, the same or subsequent owner of the property proceeds with the same or substantially similar development activity, the owner shall be eligible for a credit. The owner must petition the City and provide receipts of impact fees paid by the owner for a development of the same or substantially similar nature on the same property or some portion thereof. The City shall determine whether to grant a credit, and such determinations may be appealed by following the procedures set forth in IMC 3.71.120.

I. Interest due upon the refund of impact fees required by this section shall be calculated according to the average rate received by the City on invested funds throughout the period during which the fees were retained. (Ord. 2733 § 1 (Exh. E), 2015; Ord. 2473 § 9, 2006; Ord. 2461 § 1, 2006; Ord. 2145 § 10, 1997. Formerly 18.15.090).

3.71.095 Impact fee accounts and refunds – Reciprocal impact fees.

Repealed by Ord. 2569. (Ord. 2473 § 10, 2006; Ord. 2461 § 1, 2006; Ord. 2290 § 1, 2000; Ord. 2258 § 5, 1999. Formerly 18.15.095).

3.71.100 Processing.

Repealed by Ord. 2473. (Ord. 2461 § 1, 2006; Ord. 2145 § 11, 1997. Formerly 18.15.100).

3.71.110 Other authority.

Nothing in this chapter is intended to limit the City’s authority under the State Environmental Policy Act or any other source. (Ord. 2733 § 1 (Exh. E), 2015; Ord. 2461 § 1, 2006; Ord. 2145 § 12, 1997. Formerly 18.15.110).

3.71.120 Appeals.

Any appeal of the City’s decision regarding the impact fee shall follow the appeal process set forth in IMC 18.04.252. (Ord. 2733 § 1 (Exh. E), 2015; Ord. 2473 § 12, 2006; Ord. 2461 § 1, 2006; Ord. 2301 § 5, 2001; Ord. 2290 § 1, 2000; Ord. 2258 § 6, 1999; Ord. 2145 § 13, 1997. Formerly 18.15.120).