Chapter 3.63
IMPACT FEES

Sections:

3.63.010    Short title, authority and purpose.

3.63.020    Payment and amount of park impact fees by subdivider.

3.63.030    Payment and amount of park impact fees.

3.63.040    Basis for dedication or assessment of park impact fees.

3.63.050    Dedication suitability.

3.63.060    Dedication standards.

3.63.065    Payment and amount of transportation impact fees for development activities.

3.63.068    Credits for transportation impact fees.

3.63.070    Fund created – Use of funds.

3.63.075    Deferral of impact fees.

3.63.080    Refunds.

3.63.085    Exemption or reduction for low-income housing.

3.63.090    Appeals.

3.63.100    Relationship to SEPA.

3.63.010 Short title, authority and purpose.

(1) The ordinance codified in this chapter shall be known and may be cited as the “impact fee” ordinance.

(2) This chapter is enacted pursuant to the Washington Growth Management Act, Chapters 82.02 and 82.03 RCW.

(3) It is the purpose of this chapter to:

(a) Ensure that adequate park, recreation and 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 park, recreation and transportation facilities needed to serve new growth and development;

(c) Ensure that park, recreation and 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 Oak Harbor comprehensive plan; and

(e) Provide additional funding for growth-related park and recreation facilities improvements identified by the Oak Harbor park and recreation facilities plan and for transportation improvements identified in the capital facilities as reasonable and necessary to meet the future growth needs of the city. (Ord. 1103 § 2, 1997; Ord. 1045, 1996).

3.63.020 Payment and amount of park impact fees by subdivider.

All persons proposing any subdivision of property zoned for residential use may pay the impact fee set out hereinafter in accordance with the provisions of this chapter at the time that the plat of the subdivision receives preliminary approval. Payment for short plats may be at the time the subdivision receives administrator’s approval; provided, however, that the impact fees herein assessed may be paid at or before the time of final approval of a long subdivision if such fees are bonded as an additional cost. Impact fees not paid at the time of subdivision or short plat approval shall be paid at the time of building permit issuance. Park impact fees associated with residential short plats and subdivisions may be deferred in conformance with OHMC 3.63.075.

The park impact fees imposed in this section for a single-family residence lot and for a multiple-family, mobile home or modular home lot as computed in the appendix shall be in the master fee schedule adopted by resolution of the city council. (Ord. 1772 § 1, 2016; Ord. 1696 § 3, 2014; Ord. 1697 § 1, 2014; Ord. 1473 § 2, 2006; Ord. 1103 § 3, 1997; Ord. 1045, 1996).

3.63.030 Payment and amount of park impact fees.

Prior to the issuance of any building permit for any single-family residence, multiple-family residence, or for installation of any modular or mobile home, the park impact fees imposed herein shall be paid, less any credit for impact fees paid under this chapter at time of subdividing property. Park impact fees associated with single-family detached or attached new residential construction may be deferred in conformance with OHMC 3.63.075. (Ord. 1772 § 1, 2016; Ord. 1696 § 4, 2014; Ord. 1697 § 1, 2014; Ord. 1473 § 2, 2006; Ord. 1103 § 4, 1997; Ord. 1045, 1996).

3.63.040 Basis for dedication or assessment of park impact fees.

(1) All land dedications or park impact fee assessments shall be made on a per unit basis. “Unit” shall mean each dwelling unit, mobile home or lot as applicable and as defined in OHMC Title 19 (Zoning). Where the number of dwelling units or mobile homes is not precisely known at the time of development, “unit” shall mean at least one dwelling unit or mobile home for each lot, to be increased, when the number of dwelling units or mobile homes becomes known or fixed through application for a building permit or other applicable permit.

(2) Dedication of land is an alternative to payment of the park impact fees imposed in this chapter. It shall be allowed only to the extent agreed between the subdivider/developer and the city. If agreement cannot be reached, or is not appropriate, the park impact fees imposed by this chapter shall be paid. (Ord. 1103 § 5, 1997; Ord. 1045, 1996).

3.63.050 Dedication suitability.

Dedication of land that is improved for public parks, recreation facilities and open spaces is one method of mitigating the impacts on such facilities caused by property subdivision or development proposals within the city. Every property subdivision or development proposal will be reviewed by the director of development services for determination of suitable lands for dedication for parks, recreation facilities and open spaces in accordance with the standards set forth herein. Dedication shall generally not be a suitable alternative for providing parks, recreation facilities and open spaces in the following cases:

(1) Where the area that would be dedicated for said purpose would be less than one acre in any one location;

(2) Where the property subdivision development is in close proximity to public land already dedicated for park purposes; and

(3) Where dedication would not be consistent with the city’s comprehensive plan, parks plan or capital improvement plan. (Ord. 1273 § 1, 2001; Ord. 1045, 1996).

3.63.060 Dedication standards.

(1) The director of development services shall determine the suitability and location of lands for dedication. Dedications shall be considered suitable which best serve the public interest in providing a variety of lands for parks, recreation facilities and open spaces. The director of development services shall determine, in concert with the developer, if dedicated lands shall be improved and the specific improvements to be installed.

(2) Dedications allowed shall be completed at the earliest applicable date as a condition of approval of a building permit, conditional use permit, mobile home park, mobile home subdivision, planned unit development, short plat or final plat involving a residential or potential residential use.

(3) Any party may appeal the decision of the director of development services which concerns dedications to the park board for final determination of the issue. (Ord. 1273 § 2, 2001; Ord. 1045, 1996).

3.63.065 Payment and amount of transportation impact fees for development activities.

(1) The owners of property in which development activity takes place shall pay a transportation impact fee set out hereinafter in accordance with this chapter. Such transportation impact fee shall be deposited with the city prior to written approval from the city which authorizes commencement of such development activity.

(2) “Development activity at the time the building permit is issued according to RCW 82.02.090(1)” means any construction or expansion of a building, structure or use, any change in use of a building or structure, or any changes in the use of land that create additional demand and need for transportation facilities. Transportation impact fees shall be collected at the time the building permit is issued.

(3) The transportation impact fees imposed in this section per peak hour trip generated for nonresidential activities and per residential unit developed shall be in the master fee schedule adopted by resolution of the city council. Peak hour trip generation shall be determined as per Chapter 11.32 OHMC.

(4) The following development activities are exempt from imposition of transportation impact fees:

(a) Replacement of a structure with a new structure of the same gross floor area and use at the same site or lot when such replacement occurs within five years of the demolition or destruction of the prior structure.

(b) Replacement, alteration, expansion, enlargement, remodeling, rehabilitation or conversion of an existing dwelling unit where no additional units are created and the use is not changed.

(c) Any building permit for a legal accessory dwelling unit approved under OHMC Title 19 (Zoning) as it is considered part of the single-family use associated with this fee.

(d) Alteration of an existing nonresidential structure that does not expand the usable space or change the use.

(5) All commercial development activity occurring within the area zoned central business district (CBD, CBD-1 and CBD-2) is exempt from imposition of transportation impact fees.

(6) The public works director is authorized to adjust the impact fees to be calculated under this chapter where the developer demonstrates that unusual circumstances make the standard impact fee applied to such development unfair or unjust. The circumstances that form the basis for the adjustment shall not be circumstances that are generally applicable to similar land uses or to all development activity in the vicinity. Unusual circumstances may include that the development activity will have substantially less impact on the system improvements than other development activities in the same land use category. Any request for an adjustment shall be made no later than the time of the application triggering imposition of impact fees. Adjustments granted under this section shall not be transferable from one property, project or development activity to another.

(7) Transportation impact fees assessed for single-family detached or attached new residential construction may be deferred in conformance with OHMC 3.63.075. (Ord. 1772 § 2, 2016; Ord. 1735 § 1, 2015; Ord. 1696 § 5, 2014; Ord. 1103 § 6, 1997).

3.63.068 Credits for transportation impact fees.

(1) Credit shall be given for the fair market value of any dedication of land for improvement to or new construction of any transportation project designated in the capital facilities element and required by the city as a condition of approving the development activity over and above the minimum development standards set out in the Oak Harbor Municipal Code.

(2) “Fair market value” means the price in terms of money that a property or improvement will bring or cost in a competitive and open market under all conditions of a fair sale, the buyer and seller each prudently knowledgeable, and assuming the price is not affected by undue stimulus.

(a) The city engineer shall determine fair market value.

(b) The person seeking a credit must provide and pay for an appraisal, engineer’s estimate or any other proof or information as required by the city engineer to assist in determining fair market value.

(c) Any credit granted shall be for fair market value at time of approval of development activity. (Ord. 1103 § 7, 1997).

3.63.070 Fund created – Use of funds.

(1) A neighborhood park and recreational facilities capital improvement fund, a community park and recreational facilities capital improvement fund, and a transportation and capital improvement fund are hereby created. The finance director shall be the fund manager. Park and recreation facilities and transportation impact fees shall be placed in the appropriate interest bearing deposit account for each fund.

(2) Impact fees paid to the city shall be held and disbursed as follows:

(a) When the council appropriates capital improvement project funds for a project, it may appropriate part of the costs of construction from the appropriate capital improvement fund. Moneys appropriated from other city sources shall comprise both the public share of the project cost and an advancement of that portion of the private share that has not yet been collected in impact fees;

(b) The first money spent by the department on a project after a council appropriation shall be deemed to be the fees from the capital improvement fund;

(c) Fees collected after a project has been fully funded by means of one or more council appropriations may be deemed to constitute reimbursement to the city of the public moneys advanced for the private share of the project;

(d) All interest earned on the impact fees paid as herein provided shall be retained in the account and expended for the purpose or purposes for which the impact fees were imposed.

(3) Capital improvement impact fees for parks and recreational facilities or transportation shall be expended only in conformance with the capital facilities element of the Oak Harbor comprehensive plan.

(4) Park and recreational facilities and transportation projects shall be funded by a balance between the capital improvement fund fees and other sources of public funds, and shall not be funded solely by impact fees.

(5) Impact fees shall be expended or encumbered for a permissible use within 10 years of receipt, unless there exists an extraordinary or compelling reason for fees to be held longer than 10 years. The city administrator, or his or her designee, may recommend to the council that the city hold fees beyond 10 years in cases where extraordinary or compelling reasons exist. Such reasons shall be identified in written findings by the council.

(6) The finance director shall provide an annual report on each impact fee account showing the source and amount of all moneys received and the system improvements that were financed by impact fees. Impact fees shall be considered expended or encumbered on a first in, first out basis. (Ord. 1746 § 1, 2015; Ord. 1103 § 8, 1997; Ord. 1045, 1996).

3.63.075 Deferral of impact fees.

Impact fees assessed for single-family detached or attached new residential construction may be deferred at the election of an applicant for impact fee deferral under the following terms and conditions:

(1) For each single-family residence for which any impact fee deferral is applied for, an administrative fee set in the master fee schedule must simultaneously be paid to the city due to increased burden placed on city staff for processing and monitoring.

(2) A separate application must be submitted for each single-family residence being constructed. Only the first 20 applications per calendar year (based upon date of submittal), by each applicant for impact fee deferral, are eligible for deferral under this section.

(3) The period of deferral expires at:

(a) The time of final inspection by the city;

(b) The time of issuance of a certificate of occupancy by the city; or

(c) Eighteen months after the building permit is issued by the city.

(4) The applicant for impact fee deferral must grant and record in favor of the city of Oak Harbor an impact fee lien in the amount of the deferred impact fee. The lien must be in a form approved by the city and must include:

(a) A legal description, tax account number, and address of the property;

(b) Signatures by all owners of the property and persons or entities holding any interest in the property, with all signatures acknowledged as required for a deed and recorded in Island County;

(c) A statement that the lien is binding on all successors in title after the recordation;

(d) A statement that it is junior and subordinate to one mortgage for the purpose of construction upon the same real property granted by the person who applied for the deferral of impact fees.

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

(6) If impact fees are not paid in accordance with the deferral, the city may initiate foreclosure proceedings in accordance with Chapter 61.12 RCW.

(7) The city shall withhold final inspection or certificate of occupancy will not be issued until the impact fees have been paid in full. Upon receipt of final payment of impact fees deferred under this section, the city shall execute a release of deferred impact fee lien for each single-family attached or detached residence for which the impact fees have been received. The applicant, or property owner at the time of release, shall be responsible for recording the lien release at his or her expense.

(8) For the purposes of this section the following definitions are applied:

(a) “Applicant for impact fee deferral” means an applicant for a building permit that also makes application for impact fee deferral. It includes an entity that controls the applicant, is controlled by the applicant, or is under common control with the applicant.

(b) “Transfer” means sale as defined in RCW 82.45.010, forfeiture, foreclosure, trade, gift, receivership, bankruptcy or other change in ownership interest in real property or improvements. (Ord. 1772 § 3, 2016).

3.63.080 Refunds.

(1) Anyone required by this chapter to pay an impact fee may request and shall receive a refund when the action for which impact fees were paid is abandoned or does not proceed, and the payor shows that no impact has resulted. However, the city’s costs incurred in evaluating the development shall not be refunded, but shall be paid instead to the general fund as reimbursement for the costs so expended by the city.

(2) If a property owner appears to be entitled to a refund of impact fees, the city 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 herein, 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 impact 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 Island County assessor at the time of refund.

(4) If the city seeks to terminate any or all impact fee requirements, all unexpended or unencumbered funds shall be refunded pursuant to this section. Upon a 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 potential claimants. Claimants shall request refunds in the manner provided 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 purpose of the fund. This notice requirement shall not apply if there are no unexpended or unencumbered balances within an account or accounts being terminated.

(5) A property owner may request and shall receive a refund, including interest earned on the impact fees, when the developer does not proceed with the development activity and no impact has resulted. (Ord. 1103 § 9, 1997; Ord. 1045, 1996).

3.63.085 Exemption or reduction for low-income housing.

(1) Low-income housing projects being developed by public housing agencies or private nonprofit housing developers may apply to be exempt from the payment of impact fees. The amount of the impact fees not collected from low income household development shall be paid from public funds other than impact fee accounts. The impact fees for these units shall be considered paid for by the city through its other funding sources, without the city actually transferring funds from its other funding sources into the impact fee account. The director of development services shall review proposed developments of low income housing by such public or nonprofit developers that apply pursuant to criteria and procedures adopted by administrative rule, and shall advise the building official and finance director as to whether the project qualifies for the exemption.

(2) The director of development services is hereby instructed and 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-income households by public housing agencies or private nonprofit housing developers participating in publicly sponsored or subsidized housing programs;

(b) Ensure that housing that qualifies as low-cost meets appropriate standards regarding household income, rent levels or sale prices, location, number of units and development size. (Ord. 1273 § 3, 2001; Ord. 1103 § 10, 1997).

3.63.090 Appeals.

(1) Any property owner may pay an impact fee imposed by this chapter under protest in order to obtain a building permit or any other approval, and after such payment may file an appeal with the city clerk with the amount of such impact fee and in accordance with this section.

(2) The determination of the director of development services for subdivision approval or building official for permit approval regarding the applicability of the impact fee to a given development activity within the city shall be final. The city council shall have the power to hear and decide appeals where it is alleged there is error in the director of development services or building official’s determination of the impact fee imposed upon a development activity under this chapter.

(3) Appeals to the city council regarding the amount of the impact fee imposed on any development activity may only be taken by the owner of the property where such development activity will occur. No appeal shall be permitted unless and until the impact fee at issue has been paid. Such appeals shall be taken within a reasonable time, not to exceed 10 days from the date of decision, by filing with the city clerk a notice of appeal specifying the grounds thereof, and depositing a fee per the master fee schedule adopted by resolution of the city council. The city clerk shall forthwith transmit to the city council all papers constituting the record upon which the amount of the impact fee was determined.

(4) The city council shall fix a reasonable time for the hearing of appeal, give public notice thereof as well as due notice to the parties in interest, and decide the same within a reasonable time. At the hearing, any party may appear in person or by agent or attorney.

(5) In exercising the above-mentioned powers, the city council may, so long as such action is in conformity with the terms of this chapter, reverse or affirm, wholly or partly, or may modify the determination of the amount of the impact fee appealed from only upon a determination that it is proper to do so based on principles of fairness, and may make such order, requirements, decision or determination as ought to be made, and to that end shall have the powers with respect to the determination of the impact fees as are granted the director of development services or building official by this chapter.

(6) To decide in favor of the applicant on any matter upon which it is required to pass under this chapter, or to effect any variation in the application of this chapter, a simple majority of those present and constituting a quorum, as determined by the city council, shall suffice.

(7) Any person or persons, or any board, taxpayer, department or bureau of the city aggrieved by any decision of the city council may seek review by a court of record of such decision, in the manner provided by the laws of the state.

(8) The deposit required under subsection (3) of this section shall be used to pay the costs of the hearing unless the city council makes a determination that the applicant is the prevailing party and is not liable for the costs of the hearing. (Ord. 1696 § 6, 2014; Ord. 1273 § 4, 2001; Ord. 1205 § 1, 2000; Ord. 1045, 1996).

3.63.100 Relationship to SEPA.

When developments are subject to environmental review pursuant to SEPA and other applicable Oak Harbor ordinances and regulations, payment of the park and recreational facilities impact fee shall constitute satisfactory mitigation of those impacts related to parks and recreational facilities. (Ord. 1045, 1996).