Chapter 19.95
SCHOOL IMPACT FEES1
Sections:
19.95.010 Findings and authority.
19.95.030 Impact fee program elements.
19.95.040 Recommended fee calculations.
19.95.047 Council discretion in adopting impact fee.
19.95.050 Assessment of impact fees.
19.95.055 Option for deferred payment of school impact fee.
19.95.057 Administrative fees.
19.95.060 Exemptions and credits.
19.95.070 Appeals and independent calculations.
19.95.080 The impact fee account – Uses of impact fees and refunds.
19.95.090 Interlocal agreement.
19.95.100 Submission of district capital facilities plan and data.
19.95.010 Findings and authority.
The city council of the city of Federal Way (the “council”) hereby finds and determines that continuing growth and development in the city of Federal Way will create additional demand and need for school facilities, and the council finds that the Washington State Growth Management Act requires that new growth and development should pay a proportionate share of the cost of new facilities needed to serve the new growth and development.
Therefore, pursuant to Chapter 82.02 RCW, the council adopts this title to assess school impact fees. The provisions of this title shall be liberally construed in order to carry out the purposes of the council in establishing the school impact fee program.
(Ord. No. 95-249, § 1, 11-21-95. Code 2001 § 14-209.)
19.95.020 Definitions.
The definitions in this section apply throughout this chapter unless the context clearly requires otherwise. To the extent they do not conflict with this section, the definitions in RCW 82.02.090 are adopted and apply throughout this chapter unless the context clearly requires otherwise. Terms not defined here or in RCW 82.02.090 are defined according to FWRC 1.05.020.
“Capital facilities plan” means the district’s capital facilities plan adopted by the school board consisting of:
(1) A forecast of future needs for school facilities based on the district’s enrollment projections;
(2) The long-range construction and capital improvements projects of the district;
(3) The schools under construction or expansion;
(4) The proposed locations and capacities of expanded or new school facilities;
(5) At least a six-year financing plan component, updated as necessary to maintain at least a six-year forecast period, for financing needed school facilities within projected funding levels, and identifying sources of financing for such purposes, including bond issues authorized by the voters and projected bond issues not yet authorized by the voters;
(6) Any other long-range projects planned by the district; and
(7) A recommended impact fee amount per dwelling unit type.
“Classrooms” means educational facilities of the district required to house students for its basic educational program. Specialized facilities as identified by the district, including but not limited to gymnasiums, cafeterias, libraries, administrative offices, and child care centers, are not classrooms.
“Construction cost per student” means the estimated cost of construction of a permanent school facility in the district for the grade span of school to be provided, as a function of the district’s design standard per grade span and taking into account the requirements of students with special needs.
“Design standard” means the space required, by grade span and taking into account the requirements of students with special needs, which is needed in order to fulfill the educational goals of the district as identified in the district’s capital facilities plan.
“Developer” means the person or entity who owns or holds purchase options or other development control over property for which development activity is proposed.
“Development activity” means any residential construction or expansion of a building, structure or use, any change in use of a building or structure, or any change in the use of land that creates additional demand for school facilities.
“Development approval” means any written authorization from the city which authorizes the commencement of a development activity or use.
“District” means the Federal Way School District No. 210, King County, Washington.
“Elderly” means a person aged 62 or older.
“Encumbered” means to reserve, set aside, or otherwise earmark the impact fees in order to pay for commitments, contractual obligations, or other liabilities incurred for public facilities.
“Grade span” means the categories into which a district groups its grade of students, i.e., elementary school, middle or junior high school, and high school.
“Interlocal agreement” means the interlocal agreement by and between the city and the district as authorized in FWRC 19.95.090.
“Permanent facilities” means the facilities of the district with a fixed foundation which are not relocatable facilities.
“Relocatable facilities cost per student” means the estimated cost of purchasing and siting a relocatable facility in the district for the grade span of school to be provided, as a function of the district’s design standard per grade span and taking into account the requirements of students with special needs.
“Relocatable facility” means any factory-built structure, transportable in one or more sections, that is designed to be used as an education space and is needed to prevent the overbuilding of school facilities, to meet the needs of service areas within the district, or to cover the gap between the time that families move into new residential developments and the date that construction is completed on permanent school facilities.
“Site cost per student” means the estimated cost of a site in the district for the grade span of school to be provided, as a function of the district’s design standard per grade span and taking into account the requirements of students with special needs.
“Standard of service” means the standard adopted by the district which identifies the program year, the class size by grade span and taking into account the requirements of students with special needs, the number of classrooms, the types of facilities the district believes will best serve its student population, and other factors as identified by the district. The district’s standard of service shall not be adjusted for any portion of the classrooms housed in relocatable facilities which are used as transitional facilities or for any specialized facilities housed in relocatable facilities. Except as otherwise defined by the school board pursuant to a board resolution, “transitional facilities” shall mean those facilities that are used to cover the time required for the construction of permanent facilities called for in the capital facilities plan, where the district has the necessary financial commitments in place to complete the permanent facilities.
“Student factor” means the number derived by the district to describe how many students of each grade span are expected to be generated by a dwelling unit. Student factors shall be based on district records of average actual student generation rates for new developments constructed over a period of not more than five years prior to the date of the fee calculation, unless such information is not available in the district, in which case data from adjacent districts, districts with similar demographics, or county-wide averages may be used. Student factors must be separately determined for single-family and multifamily dwelling units, and for grade spans.
(Ord. No. 23-958, § 3, 6-6-23; Ord. No. 09-600, § 16, 1-6-09; Ord. No. 95-249, § 1, 11-21-95. Code 2001 § 14-210.)
19.95.030 Impact fee program elements.
(1) Impact fees will be assessed on all residential development activity in the city based on the provisions of this chapter.
(2) The impact fee shall be reasonably related to the impact caused by the development and shall not exceed a proportionate share of the cost of system improvements that are reasonably related to the development.
(3) The recommended impact fee shall be based on a capital facilities plan developed by the district and approved by the school board.
(Ord. No. 23-958, § 4, 6-6-23; Ord. No. 95-249, § 1, 11-21-95. Code 2001 § 14-211.)
19.95.040 Recommended fee calculations.
(1) The recommended impact fees calculation for the district shall be based on the formula set forth in Exhibit A attached to the original ordinance codified in this chapter. A copy of the fee calculation formula shall be kept on file with the ordinance codified in this chapter in the office of the Federal Way city clerk. Such formula shall take into account the following: The capital facilities needs of the district as identified in the capital facilities plan, the district’s student generation rates for single-family and multifamily dwelling units, the school site and school construction costs per student per grade level, the district’s standard of service, and the relocatable facilities cost per student per grade level.
(2) Separate fees shall be calculated for single-family and multifamily dwelling units, and separate student generation rates must be determined by the district for each type of dwelling unit. For purposes of this chapter, manufactured homes shall be treated as single-family dwelling units and duplexes shall be treated as multifamily dwelling units.
(3) The recommended fee calculations shall be made on a district-wide basis to assure maximum utilization of all school facilities in the district currently used for instructional purposes. Impact fees shall be calculated annually and set forth in the city fee schedule pursuant to FWRC 19.95.100 and 19.95.110.
(4) The formula in Exhibit A provides a credit for the anticipated tax contributions that would be made by the development based on historical levels of voter support for bond issue in the district, which historical levels shall be determined by the district.
(5) The formula also provides for a credit for school sites or facilities actually provided by a developer which the district finds to be acceptable as provided for in FWRC 19.95.060.
(Ord. No. 23-958, § 5, 6-6-23; Ord. No. 97-293, § 1, 4-15-97; Ord. No. 95-249, § 1, 11-21-95. Code 2001 § 14-212.)
19.95.045 Impact fee maximum.
(1) For developments in the CC-C, CC-F, or BC zones, notwithstanding the recommended fee calculation under FWRC 19.95.040, the impact fee assessed under FWRC 19.95.040 for studio, one-bedroom, and two-bedroom dwelling units in the development may not exceed $0.00.
(2) For other dwelling units in developments in the CC-C, CC-F, or BC zones, and developments outside the CC-C, CC-F, and BC zones, notwithstanding the recommended fee calculation under FWRC 19.95.040, the impact fee assessed under FWRC 19.95.040 may not exceed:
(a) Three thousand six hundred four dollars per single-family dwelling unit; or
(b) Two thousand two hundred twenty-two dollars per multifamily dwelling unit.
(3) Starting in 2025, the impact fee maximum established in subsection (2) of this section shall be increased by five percent or by the percentage change in the previous calendar year’s average monthly Engineering News-Record (ENR) Seattle Area Construction Cost Index values, relative to the corresponding average monthly ENR Construction Cost Index values for the preceding year, as calculated from August 1st through July 31st, whichever is lower.
(Ord. No. 23-958, § 11, 6-6-23.)
19.95.047 Council discretion in adopting impact fee.
As provided in FWRC 19.95.040 and 19.95.045, the impact fee adopted by city council in the fee schedule shall be based on the recommended fee calculation, and no higher than the impact fee maximum. The city council may, at its discretion, impose a lesser impact fee than the recommended fee calculation amount and/or impact fee maximum.
(Ord. No. 23-958, § 12, 6-6-23.)
19.95.050 Assessment of impact fees.
(1) The city shall collect school impact fees in the amounts specified in the fee schedule adopted by city council, from any applicant seeking development approval from the city where such development activity requires the issuance of a residential building permit or a manufactured home permit.
(2) For all applications for single-family, multifamily residential building permits, and manufactured home permits, the total amount of the impact fees shall be calculated at the time of the earliest complete application for a development approval required for the development activity using the fee schedule then in effect and shall be collected from the applicant when the residential building permit or manufactured home permit is issued. Notwithstanding the foregoing, for all residential building permits or manufactured home permits associated with the development activity not issued within two years of the earliest complete application for a development approval applicable to the development activity, the total amount of the impact fees for such permits shall instead be calculated and collected at the time each permit is issued, using the fee schedule then in effect. Irrespective of the date that the application for a residential building permit or manufactured home permit was submitted, no permit shall be issued until the required school impact fees set forth in the fee schedule have been paid, except as authorized under FWRC 19.95.055.
(3) No less than 60 days prior to the end of the two-year period in subsection (2) of this section, an applicant may submit a written request with supporting documentation to the department of community development requesting an extension of the two-year period for up to one additional year. The community development director may approve such a request only if it meets the following criteria:
(a) The applicant has made substantial progress toward residential building permit or manufactured home permit issuance since the complete application for the development approval;
(b) There are circumstances beyond the applicant’s control which prevented issuance of the residential building permit or manufactured home permit; and
(c) The extension will not create or continue conditions that constitute a code violation or an attractive nuisance, contribute to erosion and sedimentation problems, or impact the public health, safety, and welfare.
Determinations of the community development director under this section shall be subject to the appeal procedures set forth in FWRC 19.95.070.
(Ord. No. 23-958, § 6, 6-6-23; Ord. No. 16-822, § 6, 8-9-16; Ord. No. 97-293, § 2, 4-15-97; Ord. No. 95-249, § 1, 11-21-95. Code 2001 § 14-213.)
19.95.055 Option for deferred payment of school impact fee.
An applicant may request, at any time prior to building permit issuance, and consistent with the requirements of this section, to defer to final building inspection the payment of a school impact fee for a single-family residential dwelling unit pursuant to FWRC 19.100.075.
(Ord. No. 16-822, § 7, 8-9-16.)
19.95.057 Administrative fees.
(1) For each impact fee imposed, there shall be charged an administrative fee for the administration of the school impact fee program in the amount specified in the city fee schedule. The administrative fee shall be deposited into an administrative fee account within the school impact fee fund provided for in FWRC 19.95.080. Administrative fees shall be used only to defray the cost incurred by the city in performing actions related to implementation of this chapter and update of the school impact fee program. The administrative fee is not creditable or refundable.
(2) The administrative fee shall be paid by the applicant at the same time as the impact fee.
(Ord. No. 23-958, § 13, 6-6-23.)
19.95.060 Exemptions and credits.
(1) The following shall be exempt from the application of impact fees:
(a) Any form of housing exclusively for the elderly, including nursing homes and retirement centers, so long as these uses are maintained in perpetuity and the necessary covenants or declarations of restrictions are recorded on the property to ensure that no children will reside in the development; or
(b) The replacement of a structure with a new structure of substantially the same size and use at the same site or lot when such replacement occurs within 12 months of the demolition or destruction of the prior structure; or
(c) Alterations or expansion or enlargement or remodeling or rehabilitation or conversion of an existing dwelling unit where no additional units are created and the use is not changed;
(d) Accessory dwelling units (“ADUs”).
(2) Arrangement may be made for later payment with the approval of the district only if the district determines that it will be unable to use or will not need the payment until a later time; provided, that sufficient security, as defined by the district in its sole reasonable discretion, is provided to assure payment. Security shall be made to and held by the district, which will be responsible for tracking and documenting the security interest.
(3) The developer shall receive a credit for any payment which has already been made for the lot or development activity in question, either as a condition of development approval or pursuant to the terms of a voluntary mitigation agreement. The fee amount due on the development activity shall be reduced by the amount of the credit.
(4) The developer can request that a credit or credits be awarded for the value of dedicated land, improvements, or construction provided by the developer. The district shall first determine the general suitability of the land, improvements, and/or construction for district purposes. Second, the district shall determine whether the land, improvements, and/or the facility constructed are included within the district’s adopted capital facilities plan or the board of directors for the district may make the finding that such land, improvements, and/or facilities would serve the goals and objectives of the capital facilities plan of the district. The district shall forward its determination to the city, including cases where the district determines that the dedicated land, improvements, and/or construction are not suitable for district purposes.
(5) For each request for a credit or credits, if appropriate, the district shall select an appraiser from a list of independent appraisers. The appraiser shall be directed to determine the value of the dedicated land, improvements, or construction provided by the developer for the district. The developer shall pay for the cost of the appraisal.
(6) After receiving the appraisal, the district shall provide the developer with a letter or certificate setting forth the dollar amount of the credit, the reason for the credit, where applicable, the legal description of the site donated, and the legal description or other adequate description of the project or development to which the credit may be applied. The applicant must sign and date such letter or certificate indicating his/her agreement to the terms of the letter or certificate, and return such signed document to the district before the city will award the impact fee credit. The failure of the applicant to sign, date, and return such document within 60 calendar days shall nullify the credit.
(7) Any claim for credit must be made no later than 20 calendar days after the submission of an application for a building permit.
(8) In no event shall the credit exceed the amount of the impact fees due.
(Ord. No. 23-963, § 7, 7-5-23; Ord. No. 96-265, § 1, 4-2-96; Ord. No. 95-249, § 1, 11-21-95. Code 2001 § 14-214.)
19.95.070 Appeals and independent calculations.
(1) The city may adjust the amount of the school impact fee assessed if one of the following circumstances exist; provided, that the developer can demonstrate to the city’s satisfaction that the discount included in the fee formula set forth in the district’s capital facilities plan fails to adjust for the error in the calculation or fails to ameliorate for the unfairness of the fee:
(a) The developer demonstrates to the city’s satisfaction that an impact fee assessment was incorrectly calculated; or
(b) Unusual and unique circumstances identified by the developer demonstrate that if the standard impact fee amount were applied to the development, it would be unfair, unjust or unlawful.
(2) Requests for fee adjustments, and the administrative appeals process for the appeal of an impact fee, shall follow the process for the appeal of the underlying development application.
(3) A developer may provide studies and data to demonstrate that any particular factor used by the district may not be appropriately applied to the development proposal, but the district’s data shall be presumed valid unless clearly demonstrated to be otherwise by the developer. The developer shall pay for the cost of the studies and data, and must demonstrate to the city’s satisfaction that the discount included in the fee formula set forth in the district’s capital facilities plan fails to adjust for the error in the factor or in the fee calculation.
(4) Any appeal of the decision of the city’s hearing examiner with regard to fee amounts shall follow the appeals process for the underlying development application and not be subject to a separate appeal process. Any errors in the fee formula identified as a result of an appeal should be referred to the council for possible modification.
(5) Impact fees may be paid under protest in order to obtain a permit or other development approval.
(Ord. No. 95-249, § 1, 11-21-95. Code 2001 § 14-215.)
19.95.080 The impact fee account – Uses of impact fees and refunds.
(1) Impact fee receipts shall be earmarked specifically and retained in a special interest-bearing account established by the district solely for the district’s school impact fees as provided for in FWRC 19.95.090. All interest shall be retained in the account and expended for the purpose or purposes identified in subsection (2) of this section. Annually, the city, based on the report submitted by the district pursuant to FWRC 19.95.100, will forward a copy of the district’s report to the state of Washington, Growth Management Section, pursuant to RCW 82.02.070 which shows the source and amount of all monies collected, earned or received, and capital or system improvements that were financed in whole or in part by impact fees.
(2) Impact fees for the district’s system improvements shall be expended by the district for capital improvements including but not limited to school planning, land acquisition, site improvements, necessary off-site improvements, construction, engineering, architectural, permitting, financing, and administrative expenses, relocatable facilities, capital equipment pertaining to educational facilities, and any other expenses which could be capitalized, and which are consistent with the district’s capital facilities plan.
(3) In the event that bonds or similar debt instruments are issued for the advanced provision of capital facilities for which impact fees may be expended and where consistent with the provisions of the bond covenants, impact fees may be used to pay debt service on such bonds or similar debt instruments to the extent that the facilities or improvements provided are consistent with the requirements of this section.
(4) School impact fees shall be expended or encumbered within six years of receipt, unless the council identifies in written findings extraordinary and compelling reason or reasons for the district to hold the fees beyond the six-year period. The district may petition the council for an extension of the six-year period and the district set forth any such extraordinary or compelling reason or reasons in its petition. Where the council identifies the reason or reasons in written findings, the council shall establish the period of time within which the impact fees shall be expended or encumbered, after consultation with the district.
(5) 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 within six years of receipt of the funds by the city, except as provided for in subsection (4) of this section. In determining whether impact fees have been encumbered, impact fees shall be considered encumbered on a first in, first out basis. 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 city’s tax records.
(6) An owner’s request for a refund must be submitted to the council in writing within one year of the date the right to claim the refund arises or the date that notice is given, whichever date is later. Any impact fees that are not expended or encumbered within the limitations in subsection (4) of this section, and for which no application for a refund has been made within this one-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.
(7) Should the city seek to terminate any or all school impact fee requirements, all unexpended or unencumbered funds, including interest earned, shall be refunded to the current owner of the property for which a school 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 the availability of refunds in a newspaper of general circulation at least two times and shall notify all potential claimants by first-class mail addressed to the owner of the property as shown in the city’s tax records. 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 district, consistent with the provisions of this section. The notice requirement set forth above shall not apply if there are no unexpended or unencumbered balances within the account or accounts being terminated.
(8) A developer may request and shall receive a refund, including interest earned on the impact fees, when:
(a) The developer does not proceed to finalize the development activity as required by statute or city code or the Uniform Building Code; and
(b) No impact on the district has resulted. “Impact” shall be deemed to include cases where the district has expended or encumbered the impact fees in good faith prior to the application for a refund. In the event that the district has expended or encumbered the fees in good faith, no refund shall be forthcoming. However, if within a period of three 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 FWRC 19.95.070.
(9) Interest due upon the refund of impact fees required by this section shall be calculated according to the average rate received by the city or the district on invested funds throughout the period during which the fees were retained.
(Ord. No. 95-249, § 1, 11-21-95. Code 2001 § 14-216.)
19.95.090 Interlocal agreement.
(1) The mayor is authorized to execute, on behalf of the city, an interlocal agreement for the collection, expenditure, and reporting of school impact fees; provided, that such interlocal agreement complies with the provisions of this section, be in form and content acceptable to the city attorney and be approved by the city council.
(2) The district shall establish a school impact fee account with the office of the King County treasurer, who serves as the treasurer for the district. The account shall be an interest-bearing account, and the school impact fees received shall be prudently invested in a manner consistent with the investment policies of the district.
(3) For administrative convenience while processing the fee payments, school impact fees may be temporarily deposited in a city account. On a monthly basis, the city shall deposit the school impact fees collected for the district in the district’s school impact fee account.
(4) The district shall agree to indemnify and hold the city, its elected officials, officers, employees, agents, and volunteers harmless from any and all claims, demands, losses, actions and liabilities (including costs and all attorney fees) to or by any and all persons or entities, including, without limitation, their respective agents, licensees, or representatives, arising from, resulting from, or connected with the collection of impact fees or any other actions taken by the city pursuant to the terms of the ordinance codified in this chapter or pursuant to the terms of the interlocal agreement.
(Ord. No. 10-669, § 70, 9-21-10; Ord. No. 95-249, § 1, 11-21-95. Code 2001 § 14-217.)
19.95.100 Submission of district capital facilities plan and data.
On an annual basis, no later than May 1st of each year, the district shall submit the following materials to the city:
(1) The annual update of the district’s capital facilities plan;
(2) An updated fee calculation, and a proposed revised fee schedule which reflect the update to the district’s capital facilities plan; and
(3) An annual report on the school impact fee account, showing the source and amount of all monies collected, earned, or received, and the public improvements that were financed in whole or in part by impact fees.
(Ord. No. 97-293, § 3, 4-15-97; Ord. No. 95-249, § 1, 11-21-95. Code 2001 § 14-218.)
19.95.110 Review.
The city council shall review on an annual basis the materials received from the district and required under FWRC 19.95.100. The city council may make adjustments to the fee schedule as necessitated by its review, or applicable law and if the city council deems appropriate, shall adopt the fee schedule by resolution. The review and fee schedule adopted decision may occur in conjunction with the annual update of the capital facilities plan element of the city’s comprehensive plan.
(Ord. No. 97-293, § 4, 4-15-97; Ord. No. 95-249, § 1, 11-21-95. Code 2001 § 14-219.)
Cross reference: Taxation, FWRC Title 3, Division I.