This section modifies existing section 36.70A.110. Here is the modified chapter for context.
Each county that is required or chooses to plan under RCW 36.70A.040 shall designate an urban growth area or areas within which urban growth shall be encouraged and outside of which growth can occur only if it is not urban in nature. Each city that is located in such a county shall be included within an urban growth area. An urban growth area may include more than a single city. An urban growth area may include territory that is located outside of a city only if such territory already is characterized by urban growth whether or not the urban growth area includes a city, or is adjacent to territory already characterized by urban growth, or is a designated new fully contained community as defined by RCW 36.70A.350.
Based upon the growth management population projection made for the county by the office of financial management, the county and each city within the county shall include areas and densities sufficient to permit the urban growth that is projected to occur in the county or city for the succeeding twenty-year period, except for those urban growth areas contained totally within a national historical reserve. This includes areas and densities sufficient to meet mandatory provisions for the development of housing as provided for in RCW 36.70A.070 and 36.70A.210. As part of this planning process, each city within the county must include areas sufficient to accommodate the broad range of needs and uses that will accompany the projected urban growth including, as appropriate, medical, governmental, institutional, commercial, service, retail, and other nonresidential uses.
Each urban growth area shall permit urban densities and shall include greenbelt and open space areas. For counties and cities within those counties planning under RCW 36.70A.215, urban densities of no less than six net dwelling units per acre for areas zoned for and which allow housing is required. A county or city subject to the minimum six net dwelling units per acre minimum requirement may opt out of this requirement when it can be demonstrated that the area being subjected to this requirement meets one or more of the following standards:
The presence of critical areas would prevent the area or areas from being developed at six net dwelling units per acre;
The area is more than .5 miles from a major****transit stop as defined in RCW 43.21C.420(3);
The area is within a national historic reserve;
The county or city demonstrates that the area or areas are not necessary to meet housing requirements in this section or RCW 36.70A.070 or 36.70A.210; or
The county or city documents a specific infrastructure or physical constraint that would make this requirement infeasible for a particular area, and efforts are being taken to remedy such deficiency.
In the case of urban growth areas contained totally within a national historical reserve, the city may restrict densities, intensities, and forms of urban growth as determined to be necessary and appropriate to protect the physical, cultural, or historic integrity of the reserve. An urban growth area determination may include a reasonable land market supply factor and shall permit a range of urban densities and uses. In determining this market factor, cities and counties may consider local circumstances. Cities and counties have discretion in their comprehensive plans to make many choices about accommodating growth. Within one year of July 1, 1990, each county that as of June 1, 1991, was required or chose to plan under RCW 36.70A.040, shall begin consulting with each city located within its boundaries and each city shall propose the location of an urban growth area. Within sixty days of the date the county legislative authority of a county adopts its resolution of intention or of certification by the office of financial management, all other counties that are required or choose to plan under RCW 36.70A.040 shall begin this consultation with each city located within its boundaries. The county shall attempt to reach agreement with each city on the location of an urban growth area within which the city is located. If such an agreement is not reached with each city located within the urban growth area, the county shall justify in writing why it so designated the area an urban growth area. A city may object formally with the department over the designation of the urban growth area within which it is located. Where appropriate, the department shall attempt to resolve the conflicts, including the use of mediation services.
Urban growth should be located first in areas already characterized by urban growth that have adequate existing public facility and service capacities to serve such development, second in areas already characterized by urban growth that will be served adequately by a combination of both existing public facilities and services and any additional needed public facilities and services that are provided by either public or private sources, and third in the remaining portions of the urban growth areas. Urban growth may also be located in designated new fully contained communities as defined by RCW 36.70A.350.
In general, cities are the units of local government most appropriate to provide urban governmental services. In general, it is not appropriate that urban governmental services be extended to or expanded in rural areas except in those limited circumstances shown to be necessary to protect basic public health and safety and the environment and when such services are financially supportable at rural densities and do not permit urban development.
On or before October 1, 1993, each county that was initially required to plan under RCW 36.70A.040(1) shall adopt development regulations designating interim urban growth areas under this chapter. Within three years and three months of the date the county legislative authority of a county adopts its resolution of intention or of certification by the office of financial management, all other counties that are required or choose to plan under RCW 36.70A.040 shall adopt development regulations designating interim urban growth areas under this chapter. Adoption of the interim urban growth areas may only occur after public notice; public hearing; and compliance with the state environmental policy act, chapter 43.21C RCW, and under this section. Such action may be appealed to the growth management hearings board under RCW 36.70A.280. Final urban growth areas shall be adopted at the time of comprehensive plan adoption under this chapter.
Each county shall include designations of urban growth areas in its comprehensive plan.
An urban growth area designated in accordance with this section may include within its boundaries urban service areas or potential annexation areas designated for specific cities or towns within the county.
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Except as provided in (b) of this subsection, the expansion of an urban growth area is prohibited into the one hundred year floodplain of any river or river segment that: (i) Is located west of the crest of the Cascade mountains; and (ii) has a mean annual flow of one thousand or more cubic feet per second as determined by the department of ecology.
Subsection (10)(a) of this section does not apply to:
Urban growth areas that are fully contained within a floodplain and lack adjacent buildable areas outside the floodplain;
Urban growth areas where expansions are precluded outside floodplains because:
(A) Urban governmental services cannot be physically provided to serve areas outside the floodplain; or
(B) Expansions outside the floodplain would require a river or estuary crossing to access the expansion; or
iii. Urban growth area expansions where:
(A) Public facilities already exist within the floodplain and the expansion of an existing public facility is only possible on the land to be included in the urban growth area and located within the floodplain; or
(B) Urban development already exists within a floodplain as of July 26, 2009, and is adjacent to, but outside of, the urban growth area, and the expansion of the urban growth area is necessary to include such urban development within the urban growth area; or
(C) The land is owned by a jurisdiction planning under this chapter or the rights to the development of the land have been permanently extinguished, and the following criteria are met:
(I) The permissible use of the land is limited to one of the following: Outdoor recreation; environmentally beneficial projects, including but not limited to habitat enhancement or environmental restoration; stormwater facilities; flood control facilities; or underground conveyances; and
(II) The development and use of such facilities or projects will not decrease flood storage, increase stormwater runoff, discharge pollutants to fresh or salt waters during normal operations or floods, or increase hazards to people and property.
c. For the purposes of this subsection (10), "one hundred year floodplain" means the same as "special flood hazard area" as set forth in WAC 173-158-040 as it exists on July 26, 2009.
If a county, city, or utility has adopted a capital facility plan or utilities element to provide sewer service within the urban growth areas during the twenty-year planning period, nothing in this chapter obligates counties, cities, or utilities to install sanitary sewer systems to properties within urban growth areas designated under subsection (2) of this section by the end of the twenty-year planning period when those properties:
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Have existing, functioning, nonpolluting on-site sewage systems;
Have a periodic inspection program by a public agency to verify the on-site sewage systems function properly and do not pollute surface or groundwater; and
Have no redevelopment capacity; or
Do not require sewer service because development densities are limited due to wetlands, flood plains, fish and wildlife habitats, or geological hazards.
This section modifies existing section 36.70A.210. Here is the modified chapter for context.
The legislature recognizes that counties are regional governments within their boundaries, and cities are primary providers of urban governmental services within urban growth areas. For the purposes of this section, a "countywide planning policy" is a written policy statement or statements used solely for establishing a countywide framework from which county and city comprehensive plans are developed and adopted pursuant to this chapter. This framework shall ensure that city and county comprehensive plans are consistent as required in RCW 36.70A.100. Nothing in this section shall be construed to alter the land-use powers of cities.
The legislative authority of a county that plans under RCW 36.70A.040 shall adopt a countywide planning policy in cooperation with the cities located in whole or in part within the county as follows:
No later than sixty calendar days from July 16, 1991, the legislative authority of each county that as of June 1, 1991, was required or chose to plan under RCW 36.70A.040 shall convene a meeting with representatives of each city located within the county for the purpose of establishing a collaborative process that will provide a framework for the adoption of a countywide planning policy. In other counties that are required or choose to plan under RCW 36.70A.040, this meeting shall be convened no later than sixty days after the date the county adopts its resolution of intention or was certified by the office of financial management.
The process and framework for adoption of a countywide planning policy specified in (a) of this subsection shall determine the manner in which the county and the cities agree to all procedures and provisions including but not limited to desired planning policies, deadlines, ratification of final agreements and demonstration thereof, and financing, if any, of all activities associated therewith.
If a county fails for any reason to convene a meeting with representatives of cities as required in (a) of this subsection, the governor may immediately impose any appropriate sanction or sanctions on the county from those specified under RCW 36.70A.340.
If there is no agreement by October 1, 1991, in a county that was required or chose to plan under RCW 36.70A.040 as of June 1, 1991, or if there is no agreement within one hundred twenty days of the date the county adopted its resolution of intention or was certified by the office of financial management in any other county that is required or chooses to plan under RCW 36.70A.040, the governor shall first inquire of the jurisdictions as to the reason or reasons for failure to reach an agreement. If the governor deems it appropriate, the governor may immediately request the assistance of the department of commerce to mediate any disputes that preclude agreement. If mediation is unsuccessful in resolving all disputes that will lead to agreement, the governor may impose appropriate sanctions from those specified under RCW 36.70A.340 on the county, city, or cities for failure to reach an agreement as provided in this section. The governor shall specify the reason or reasons for the imposition of any sanction.
No later than July 1, 1992, the legislative authority of each county that was required or chose to plan under RCW 36.70A.040 as of June 1, 1991, or no later than fourteen months after the date the county adopted its resolution of intention or was certified by the office of financial management the county legislative authority of any other county that is required or chooses to plan under RCW 36.70A.040, shall adopt a countywide planning policy according to the process provided under this section and that is consistent with the agreement pursuant to (b) of this subsection, and after holding a public hearing or hearings on the proposed countywide planning policy.
A countywide planning policy shall at a minimum, address the following:
Policies to implement RCW 36.70A.110;
Policies for promotion of contiguous and orderly development and provision of urban services to such development;
Policies for siting public capital facilities of a countywide or statewide nature, including transportation facilities of statewide significance as defined in RCW 47.06.140;
Policies for countywide transportation facilities and strategies;
Policies that consider the need for housing for all economic segments of the population and parameters for its distribution**. For counties and cities within those counties planning under RCW 36.70A.215, housing targets for housing types identified in RCW 36.70A.070(2) shall be adopted in order to demonstrate that a county and cities within that county are collectively planning for the existing and projected housing needs of all economic segments of the community as required by RCW 36.70A.070(2). Policies must seek to balance housing supply with employment in the jurisdiction, giving special consideration to workforce housing and creating opportunities for first-time homeownership. For counties and cities within those counties subject to housing target requirements, this provision does not become effective until January 1, 2025**;
Policies for joint county and city planning within urban growth areas;
Policies for countywide economic development and employment, which must include consideration of the future development of commercial and industrial facilities; and
An analysis of the fiscal impact.
Federal agencies and Indian tribes may participate in and cooperate with the countywide planning policy adoption process. Adopted countywide planning policies shall be adhered to by state agencies.
Failure to adopt a countywide planning policy that meets the requirements of this section may result in the imposition of a sanction or sanctions on a county or city within the county, as specified in RCW 36.70A.340. In imposing a sanction or sanctions, the governor shall specify the reasons for failure to adopt a countywide planning policy in order that any imposed sanction or sanctions are fairly and equitably related to the failure to adopt a countywide planning policy.
Cities and the governor may appeal an adopted countywide planning policy to the growth management hearings board within sixty days of the adoption of the countywide planning policy.
Multicounty planning policies shall be adopted by two or more counties, each with a population of four hundred fifty thousand or more, with contiguous urban areas and may be adopted by other counties, according to the process established under this section or other processes agreed to among the counties and cities within the affected counties throughout the multicounty region.
This section adds a new section to an existing chapter 36.70A. Here is the modified chapter for context.
Cities within counties planning under RCW 36.70A.215 and those counties may establish one or more real estate excise tax density incentive zones. A real estate excise tax density incentive zone is an area within an urban growth area where the city or county adopts zoning and development regulations to increase housing supply by allowing construction of additional housing types as outright permitted uses. Creation of a real estate excise tax density incentive zone enables the local government to receive a portion of the tax imposed under chapter 82.45 RCW for sales of qualified residential dwelling units within the zone.
A real estate excise tax density incentive zone may only be located within a designated urban growth area, and must allow the following housing types: Single-family detached dwellings at a net density of at least six dwelling units per acre, duplexes, triplexes, fourplexes, townhomes, accessory dwelling units, and courtyard apartments.
A real estate excise tax density incentive zone may also allow as outright permitted uses housing types and densities that exceed the minimum requirements in subsection (2) of this section.
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For the purposes of this section, a "qualified residential dwelling" is either an individual residential dwelling unit or a residential building of two or more dwelling units constructed within a real estate excise tax density incentive zone that achieves a net increase in the total number of residential dwelling units compared to the maximum number of residential dwelling units that could have been built prior to the adoption of zoning and development regulations creating the real estate excise tax density incentive zone.
If the qualified residential dwelling has two or more dwelling units, the amount distributed to the local government under RCW 82.45.060(4)(c) shall be reduced by the percent attributable to the number of new dwelling units within the building that could have been built under the zoning and development regulations that existed prior to the creation of the local real estate excise tax density incentive zone.
A sale that does not involve a net increase above the maximum number of residential dwelling units that could have been constructed as an outright permitted use, prior to the creation of the real estate excise tax density incentive zone, is not a sale of a qualified residential dwelling unit.
A real estate excise tax density incentive zone may be established for areas where a city or county previously enacted zoning and development regulations meeting the minimum requirements in this section, but not prior to January 1, 2017. A real estate excise tax density incentive zone may not be established later than one year after the date by which a city or county is required to update its growth management comprehensive plan under RCW 36.70A.130. Once a real estate excise tax density incentive zone is established in compliance with this section, a qualified residential dwelling unit may be constructed at any time.
This section modifies existing section 82.45.060. Here is the modified chapter for context.
There is imposed an excise tax upon each sale of real property.
Through December 31, 2019, the rate of the tax imposed under this section is 1.28 percent of the selling price.
Beginning January 1, 2020, except as provided in (c) of this subsection, the rate of the tax imposed under this section is as follows:
1.1 percent of the portion of the selling price that is less than or equal to five hundred thousand dollars;
1.28 percent of the portion of the selling price that is greater than five hundred thousand dollars and equal to or less than one million five hundred thousand dollars;
2.75 percent of the portion of the selling price that is greater than one million five hundred thousand dollars and equal to or less than three million dollars;
Three percent of the portion of the selling price that is greater than three million dollars.
The sale of real property that is classified as timberland or agricultural land is subject to the tax imposed under this section at a rate of 1.28 percent of the selling price.
Beginning July 1, 2022, and every fourth year thereafter:
The department must adjust the selling price threshold in subsection (1)(b)(i) of this section to reflect the lesser of the growth of the consumer price index for shelter or five percent. If the growth is equal to or less than zero percent, the current selling price threshold continues to apply.
The department must adjust the selling price thresholds in subsection (1)(b)(ii) through (iv) of this section by the dollar amount of any increase in the selling price threshold in subsection (1)(b)(i) of this section.
The department must publish updated selling price thresholds by September 1, 2022, and September 1st of every fourth year thereafter. Updated selling price thresholds will apply beginning January 1, 2023, and January 1st every fourth year thereafter. Adjusted selling price thresholds must be rounded to the nearest one thousand dollars. No changes may be made to adjusted selling price thresholds once such adjustments take effect.
The most recent selling price threshold becomes the base for subsequent adjustments.
The department must report adjustments to the selling price thresholds to the fiscal committees of the legislature, beginning December 1, 2022, and December 1st every fourth year thereafter.
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The department must publish guidance to assist sellers in properly classifying real property on the real estate excise tax affidavit for purposes of determining the proper amount of tax due under this section. Real property with multiple uses must be classified according to the property's predominant use. The department's guidance must include factors for use in determining the predominant use of real property.
County treasurers are not responsible for verifying that the seller has properly classified real property reported on a real estate excise tax affidavit. The department is solely responsible for such verification as part of its audit responsibilities under RCW 82.45.150.
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Beginning July 1, 2013, and ending December 31, 2019, an amount equal to two percent of the proceeds of this tax must be deposited in the public works assistance account created in RCW 43.155.050, an amount equal to four and one‑tenth percent must be deposited in the education legacy trust account created in RCW 83.100.230, an amount equal to one and six-tenths percent must be deposited in the city-county assistance account created in RCW 43.08.290, and the remainder must be deposited in the general fund.
Beginning January 1, 2020, amounts collected from the tax imposed under this section must be deposited as provided in RCW 82.45.230 less any amount distributed to a city or county pursuant to (c) of this subsection (4).
Beginning July 1, 2023, the amounts collected on the sale of a qualified residential dwelling constructed within a real estate excise tax density incentive zone created under section 4 of this act shall be distributed to a city or county as follows:
For a qualified residential dwelling unit located more than .5 miles from a mass transit stop as defined in RCW 43.21C.420(3), 50 percent of the amounts collected to the city or county where the dwelling is located;
For a qualified residential dwelling unit located less than or equal to .5 miles from a mass transit stop as defined in RCW 43.21C.420(3), 25 percent of the amounts collected to the city or county where the dwelling is located.
The distribution to a city or county under (c) of this subsection applies to both the initial and all subsequent sales of a qualified residential dwelling unit. The amounts distributed to a city and county may be used solely for:
Costs associated with adoption or amendment of plans under chapter 36.70A RCW;
Preparation of the review and evaluation report pursuant to RCW 36.70A.215;
Long-term planning;
Code and development regulation amendments for the purpose of increasing housing supply; or
Code and development regulation amendments that decrease the amount of time necessary to obtain permits for housing.
The definitions in this subsection apply throughout this section unless the context clearly requires otherwise.
"Agricultural land" means farm and agricultural land and farm and agricultural conservation land, as those terms are defined in RCW 84.34.020, including any structures on such land.
"Consumer price index for shelter" means the most current seasonally adjusted index for the shelter expenditure category of the consumer price index for all urban consumers (CPI-U) as published by July 31st by the bureau of labor statistics of the United States department of labor.
"Growth of the consumer price index for shelter" means the percentage increase in the consumer price index for shelter as measured from data published by the bureau of labor statistics of the United States department of labor by July 31st for the most recent three-year period for the selling price threshold adjustment in 2022, and the most recent four-year period for subsequent selling price threshold adjustments.
"Timberland" means land classified under chapter 84.34 RCW or designated under chapter 84.33 RCW, including any structures and standing timber on such land, and standing timber sold apart from the land upon which it sits.