Chalk Line Magazine 2020 Issue #6

CHALK LINE

2020 EDITION - ISSUE #6

MAGAZINE

EDUCATION and the

TRADES

INSIDE THIS ISSUE: 2020 TOUR AWARD WINNERS

WHAT ARE IMPACT FEES?

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Chalk Line 2020 EDITION - ISSUE #6

Table of Contents Page 4 MESSAGE FROM OUR 2020 OMB PRESIDENT

Page 6 2020 TOUR OF HOMES AWARD WINNERS

Page 7 MESSAGE FROM OUR EXECUTIVE OFFICER

Page 8-9 EDUCATION & THE TRADES

Page 10-12 GOVERNMENT AFFAIRS

Page 13 OMB RENEWING MEMBERS

Page 14 2021 MEETING & EVENTS CALENDAR

me lco we New Members!

Joining in AUG & SEPT 2020!

Eco Elite Pest Control, LLC

(253) 242-9777 • sara@ecoelitepestcontrol.com 835 Central Ave N, Ste D132, Kent, WA 98032-2015 Sponsor: Barbara Whitlow

High-Tech Building & Design, Inc.

(360) 545-3370 • steve@hightechbuilding.net 625 Acorn Ct SE, Lacey, WA 98503-6768 Sponsor: Becky Rieger

Lacey South Sound Chamber of Commerce

(360) 491-414 • executivedirector@laceysschamber.com 420 Golf Club Rd SE, Ste 105, Lacey WA 98503-1048 Sponsor: John Erwin

Lessard Earthwork, LLC

(360) 861-8049 • info@lessardearthwork.com 80 Furford Ln, , Elma, WA 98541-9452 Sponsor: Becky Rieger

PCI Pest Control

(360) 628-8625 • matt@pcipestcontrol.com 2812 Pacific Ave SE, Olympia, WA 98501-2039 Sponsor: Karen McClennen

Renew Remodel, LLC

(360) 970-5937 • mark@renew-remodel.com 1318 Lebanon St SE, Lacey, WA 98503-2456 Sponsor: Barbara Whitlow

Toepelt Log, Inc.

(360) 520-3696 • toepeltlog@gmail.com 141 Doty St, Doty, WA 98539-5008 Sponsor: Erin Due

This year you can win an extra $1200.00 stimulus check! To be eligible, all you need to do is recruit new members…it’s that easy!

For each new member* you bring in between May 16th and November 16th you will receive an entry into a drawing. The drawing will BE held on November 20th when we celebrate our success!

Contact JENN at membership@omb.org for more information.

Trail Excavation

(360) 866-1944 • trail_excavation@yahoo.com 7446 Steamboat Island Rd NW, Olympia, WA 98502-9308 Sponsor: Linda Mosier-Vaudt

Woody's Septic Specialties, Inc.

(360) 642-4459 • woody@woodysseptic.com 17503 Sandridge Rd, Long Beach, WA 98631-6704 Sponsor: Barbara Whitlow

*3 member minimum for qualification.

Chalk Line • 3

PRESIDENT’S MESSAGE

ENCOURAGING A FUTURE IN THE TRADES PRESIDENT JOHN ERWIN

I feel that this is one of the most importAnt issues of the year. Education. DEDICATION TO learning and growing OURSELVES, AND encouraging youth to do the same, is the best gift we can give our COMMUNITY. At a time when countless college graduates are finding themselves underemployed and contractors in the building-industry struggle to find new employees to fill our workforce, it’s important to know that earning a college degree is not the only road to success. A vocational education is equally rewarding and can be obtained at a fraction of the cost.

What I like to tell the young kids that come work for me in the summer is to stay in school, and get your high school diploma.

The day they graduate high school, is the day they get a raise. I like to explain how

learning a trade like being a carpenter, allows you to live and work anywhere in the country and, in fact, the world. We have a whole generation of kids that were discouraged from entering the trades, only being encouraged to go to college after high school. The result of that philosophy, is there is a scarcity of employees in the field, which now makes trade work very high in demand. Plus, it’s a very rewarding career.

Ongoing efforts on our part as small business owners and professionals in the building industry are important to achieve our industry-wide goal of increasing the number of professional construction related employees in our area!

Check out the important work the OMB Eucation Foundation is doing on pages 8-9 to award scholarhsips and help fund trade based programs troughout our region, so that you can help share and encourage the next genertaion to consider a future in the trades.

"I like to explain how learning a trade like being a carpenter, allows you to live and work anywhere in the country and, in fact, the world."

4 • Chalk Line

Chalk Line

ADVERTISE & GET NOTICED

Official Publication of the Olympia Master Builders 1211 State Avenue NE, Olympia WA 98506 Phone: (360) 754-0912 • www.omb.org

The printed Hire A Pro lists all OMB members by product and service categories and counties. An AD will make you stand out! A minimum of 10,000 guides are printed and distributed to the public. Contact jill@omb.org today!

The Olympia Master Builders is a professional trade association representing 480 member companies located in Thurston, Lewis, Grays Harbor, Mason and Pacific Counties. Our members come from all sectors of the building trades and are committed to “building strong communities, one home at a time.”

Back cover - $1,500 Inside cover - $1,200 Full Page - $1,000 Half Page - $700 Quarter Page - $500 Eighth Page - $200

EXECUTIVE COMMITTEE

President – John Erwin, John Erwin Remodeling Inc. Vice President – John McKinlay, Olympia Overhead Doors Second Vice President – John Johnson, Johnson Custom Homes, LLC Treasurer – Jon Jones, Washington Business Bank Associate Vice President – Becky Rieger, Environmental Design, LLC Second Associate Vice President – Rusty Ruiz, Hung Right Doors , LLC Secretary – Barb Whitlow, Olympia Federal Savings Immediate Past President – Erik Jensen

ELECTED DIRECTORS - TWO YEAR TERM Builder Director – John Johnson Builder Director – Mike Koidahl Builder Director – Mike Auderer Associate Director – Janine Ezzell Associate Director – Kelly Jensen Builder Director – Amy Winters Builder Director – Andy Gruhn Builder Director – Kellen Mangan Associate Director – Tina Allen Associate Director – Matt Jones

NATIONAL DIRECTORS - ONE YEAR TERM

National Director-Builder – John Erwin National Director-Builder – Karen McClennen National Director-Associate – Debbi Boyd

STATE DIRECTORS - ONE YEAR TERM

State Director-Builder – Andy Gruhn State Director-Builder – John McKinlay State Director-Builder – Karen McClennen State Director-Builder – Ron Deering State Director-Builder – Harv Lillegard State Director-Builder – Andrew Spear State Director-Builder – John Johnson State Director-Builder – Steve Waltemate State Director-Associate – Becky Rieger State Director-Associate – Tina Allen State Director-Associate – Debbi Boyd State Director-Associate – Linda Mosier-Vaudt State Director-Associate – Bob Kagy

BUILDER AT LARGE

Karen McClennen

GRAYS HARBOR CHAPTER OFFICERS

President – Harv Lillegard, Lillegard Construction Vice President – Rusty Ruiz, Hung Right Doors Associate Vice President – Ryann Blake, Chimney Techniques, Inc.

LEWIS COUNTY CHAPTER OFFICERS

President – John Johnson, Johnson Custom Homes Vice President – Becky Rieger, Environmental Design, LLC Associate Vice President – Kelly Jensen, DJs Plumbing LLC Secretary – Patrick Toby, Toby’s Electric Builder Director – Toby Krause, Double Duty Land Management

MASON COUNTY CHAPTER OFFICERS

President – Andrew Spear, Andrew Spear Construction, LLC Associate Vice Pres. – Julie Nichols, Whitehouse & Nichols Attorneys at Law Associate Vice President – Mike Gill, Builders FirstSource

PACIFIC COUNTY CHAPTER OFFICERS

President – Steve Waltemate, SAW Construction Co., Inc.

LEGAL COUNSEL

Teena Williams, Goldstein Law Office, PLLC

ASSOCIATION STAFF

Executive Officer – Angela White Events Director – Brianna Bedell Government Affairs Director – Erin Hall Membership & Sales Director – Jennifer Wasson Temporary Office Administrator – Emily Jaeger Communications Director – Jill Williams

FOLLOW US ON SOCIAL MEDIA! Chalk Line • 5

~ 2020 ~

TOUR AWARD WINNERS People's Choice

Best Kitchen I Renew Remodel, LLC Best Master Bath I Interior Dimensions & Brio Construction Best Floor Plan I Interior Dimensions & Lane French Construction Best Remodel I Interior Dimensions & Kuster Homes & Remodeling, LLC Best Design/Staging I Renew Remodel, LLC Best of Show I Renew Remodel, LLC

Judge’s Choice Best Curb Appeal I Home Resource Group – Swantown Inn Best Kitchen I Interior Dimensions & Lane French Construction Best Master Bath I Interior Dimensions & Lane French Construction Best Floor Plan I John Erwin Remodeling Inc. Best Design/ Staging I Interior Dimensions & Lane French Construction Best Remodel I Interior Dimensions & Lane French Construction Best of Show I Interior Dimensions & Lane French Construction

EXECUTIVE OFFICER’S MESSAGE

THAT'S A WRAP FOR 2020!

Welcome to the last issue of Chalk Line for 2020!

This was not the year we had all expected as we made plans last fall. We made many changes to adapt to working through a pandemic and we focused on things we could control, cutting out things we could not.

EXECUTIVE OFFICER ANGELA WHITE

OMB's leadership and staff embraced new technology and proved we could make things happen and stay connected while we could not be together in person. Staff successfully worked from home, and also adapted to many changes to the office culture upon opening again. We moved many events to virtual platforms. We persevered and learned many things!

B:8.75”

With this issue of Chalk Line we chose to focus on education vs. focusing on the upheaval this year. Check out page 8 to learn more about OMB's Education Foundation partnership with Tumwater High School that brought a construction program to the school! On page 9, we brought you information on our Scholarship Program. We also shared the ins and outs of Impact Fees on pages 10-12.

For 2021 the OMB Board of Directors and staff is focusing on minimizing uncertainty as much as possible, while still planning for a meaningful year for members. OMB members, as we proved in 2020 with our fight to get the industry back to work, and with our quick adaptation of services, we are here for you!

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We are passionate about supporting the next generation and keeping the trades alive.

HOW DO WE MAKE A DIFFERENCE? Work to change the perception! To meet the upcoming housing growth, we must communicate to kids, parents, teachers and counselors, and other target groups such as veterans, that going into the trades is an exciting and profitable choice. Perceptions need to change.

We can do this by participating in school events, educating educators and getting involved in the local school systems.

THE MESSAGE: • Home Building is an innovative industry!

• The use of technology is growing daily!

• Pay is good!

• There is on-the-job training!

• There is opportunity for advancement!

• Home building is a great profession for entrepreneurs!

8 • Chalk Line

The Olympia Master Builders Education Foundation is a 501(c)(3) non-profit organization dedicated to educate, foster and stimulate interest in the construction industry by:

8

• Supporting and encouraging a climate of learning and technological advancement within the construction trades; • Awarding of scholarships to young people for the study of construction trades at accredited colleges, institutions and universities or for professional instruction; • Uniting, for their respective educational, cultural and intellectual improvement and enlightenment, young persons who are interested in participating in those activities generally carried on by the construction industry, and for the education of the public as to these matters and activities.

Over the last few years, the Foundation has awarded $35,000 in scholarships to students for the study of construction trades at accredited colleges, institutions and universities or for professional instruction. Through the Foundation, OMB members and staff have also participated heavily in local Career Fairs and other educational opportunities.

New this year, the Foundation has established a Tools for School Program, providing grants to schools for purchasing tools that are needed in their classrooms. The Foundation also funded a Pre-Apprenticeship Program at Tumwater High School, and are continually looking for more opportunities to duplicate this effort in other schools. At Tumwater H.S. and New Market Skills Center, the Construction Trades program is a pre-apprenticeship program teaching entry level construction skills and knowledge. This course gives students a clear Pathway to careers in both residential and commercial construction with an emphasis on job site safety. Additionally, students focus on employability skills, problem-solving, trainability, as well as team building. The course goal is to prepare students for direct entry into an apprenticeship of the workforce by meeting rigorous academic and industry standards. Students learn real world experiences through field trips, guest speakers, and hands-on activities/projects.

"Today's students are excited to have access to great career training!

More than ever we are seeing young people engaged in their pathway to a career that fits well with what they want out of life."

Adam Shell and Steve Eliason, Instructors

SCHOLARSHIP PROGRAM

This year, OMB awarded $12,000 in scholarships to ten students, to assist them in financing their education.

Do you know a high school senior or college student that is interested in pursuing a career in the building industry?

We have great news for you!

2020 SCHOLARSHIP RECIPIENTS

8

Irvin Vicente: $1850 Vocational Recipient (Grays Harbor CC) Logan Fry: $1850 Collegiate Recipient (Rochester High School) Lochlan Glass (North Thurston High School) Matthew Scheuber (Oregon State University) Jake Eko (Adna High School) Kayden Kelly (WF West High School) Jonathon Schade (Black Hills High School) Emma Leszezak (North Thurston High School) Ke'ianu Fualelei Trinidad (River Ridge High School) Maleaha Smith (Centralia Community College) The OMB Education Foundation and its chapters in Lewis, Grays Harbor, Pacific and Mason counties, will begin accepting applications in early 2021 for vocational scholarship grants to college or vocational/technical school-bound students, who currently reside within Thurston, Lewis, Mason, Pacific or Grays Harbor Counties.

The OMB Education Foundation has been offering Scholarships to assist students who plan to further their education in the building industry since 1993.

Applicants must be a U.S. citizen and intend to pursue studies leading to a career in the building industry, such as (but not limited to): Engineering, Architecture, Drafting, Industrial Design, Carpentry, Plumbing, Electrical, HVAC and Construction Management.

The Building Industry Association of Washington (BIAW) also provides scholarships to students pursuing a degree in home building and industry-related fields, visit biaw.com for more information.

Applications for the OMB Education Foundation Scholarships will be available online early winter. Visit omb.org for an application!

Government Affairs IMPACT FEES - EVERYTHING YOU NEED TO KNOW Over the past quarter century, impact fees have become an integral part of local government infrastructure financing. As an offspring of the negotiated exaction and the fee-in-lieu of land dedication, impact fees have done more to change our approach to paying for public facilities than any other single financing technique.

Because of them, the phrase "growth should pay its own way" is now part of our national vocabulary.

Impact fees are charges assessed on new development, as a condition of approval, to pay for public facilities needed to serve new growth. The purpose and size of the fees must be reasonably related to the new development creating additional demand for public facilities. Currently, local governments fully planning under the Growth Management Act may impose impact fees for fire protection, parks, schools, and/or transportation facilities.

In 2015, the Washington State Legislature amended the statute governing impact fees to require local governments imposing impact fees to establish a deferral process for small constructors of residential development to delay the payment of impact fees for up to 18 months. All local governments imposing impact fees need to have adopted an ordinance bringing this into effect by Sept.

1, 2016.

Impact fees are one-time charges assessed by a local government against a new development project to help pay for new or expanded public facilities that will directly address the increased demand for services created by that development.

10 • Chalk Line

What Can Impact Fees Be Used For?

RCW 82.02.050 - .110 and WAC 365-196-850 authorize counties, cities, and towns planning under the Growth Management Act (GMA) to impose impact fees for: • Public streets and roads • Publicly owned parks, open space, and recreation facilities • School facilities • Fire protection facilities These impact fees may only be imposed for “system improvements” - public capital facilities in a local government’s capital facilities plan that are designed to provide service to the community at large (not private facilities), are reasonably related to the new development, and will benefit the new development (WAC 365-196-850).

Impact fees cannot exceed a proportionate share of the cost of the system improvements, and municipalities must have additional funding sources and may not rely solely on impact fees to fund the improvements (RCW 82.02.050).

Impact fees may not be used to correct existing deficiencies. For instance, a school district may use the impact fees from a development to pay for construction of new classrooms at specific schools to accommodate the increased enrollment anticipated from that specific development. But the district may not use the impact fees to build new classrooms to reduce overcrowding caused by existing residents.

An impact fee ordinance, however, “may provide for the imposition of an impact fee for system improvement costs previously incurred by a county, city, or town to the extent that new growth and development will be served by the previously constructed improvements provided such fee shall not be imposed to make up for any system improvement deficiencies” (RCW 82.02.060(8)).

For example, if a public works maintenance facility was designed and constructed to address both existing deficiencies (say, 60%) and future growth needs (say, 40%), impact fees could be used to pay for up to 40% of the debt service on the bond issued for that facility.

Transportation Impact Fees

Transportation impact fees must be used for “public streets and roads” that are addressed by a capital facilities plan element of a comprehensive plan adopted under the GMA (RCW 82.02.050(4) and RCW 82.02.090(7)).

It is unclear whether state law allows these impact fees to be used to fund multimodal improvements, but such use is probably acceptable as long as the improvement is within the street right-of-way - such as bus lanes, sidewalks, or bike lanes - and there is a strong transportation-related justification.

However, it is doubtful that impact fees could pay for buses, vanpool vehicles, recreational trails, or other projects outside the right-ofway.

Since impact fees are restricted to capital facilities, they cannot be used to fund transportation studies or operating and maintenance costs.

Bellingham has compiled a comparison of 2019-20 transportation impact fee base rates in Western Washington.

Note: This information only applies to transportation impact fees authorized by RCW 82.02.050 - .110 and WAC 365-196-850 for jurisdictions planning under GMA. Separate legislation (the Local Transportation Act, chapter 39.92 RCW, whose initial passage predated GMA by two years) authorizes all counties, cities, towns, and transportation benefit districts across the state - including those not planning under GMA - to impose transportation impact fees, but MRSC is not aware of any jurisdictions that currently do so under that authority.

Park Impact Fees

Park impact fees must be used for “publicly owned parks, open space, and recreation facilities” that are addressed by a capital facilities plan element of a comprehensive plan adopted under the GMA (RCW 82.02.050(4) and RCW 82.02.090(7)).

Most cities and counties in Washington only charge park impact fees to residential construction or the residential portion of a

mixed use building or development, but a few also charge commercial or industrial developments, since employees (and not just residents) can directly benefit from nearby parks and recreational facilities. (See Tukwila's example in the sample documents section.)

School Impact Fees

School impact fees must be used for “school facilities” that are addressed by a capital facilities plan element of a comprehensive plan adopted under the GMA (RCW 82.02.050(4) and RCW 82.02.090(7)). Typically, school impact fees apply only to residential construction or the residential portion of a mixed use building or development.

School districts are responsible for expending the impact fees but are not authorized to collect the fees. As a result, school impact fees require cooperation between school districts and the cities, towns, or counties administering the impact fee program. This cooperation should take the form of an interlocal agreement (ILA) that specifically identifies each party’s role.

Any exemption for school impact fees that would otherwise be distributed to a school district must first be approved by the school district (RCW 82.02.060(3)).

Fire Impact Fees

Fire impact fees must be used for “fire protection facilities” that are addressed by a capital facilities plan element of a comprehensive plan adopted under the GMA (RCW 82.02.050(4) and RCW 82.02.090(7)). Because state law provides no further statutory or administrative definitions, some jurisdictions have taken it upon themselves to define “fire protection facilities” in their own municipal codes. (See Auburn's example in the sample documents section, which includes fire engines and equipment.)

Determining Impact Fee Rates

Local governments must establish a rate schedule for each type of development activity that is subject to impact fees, specifying the fee to be imposed for each type of system improvement (RCW 82.02.060). The schedule must be based on a formula or other calculation that incorporates, among other things: • The cost of public facilities necessitated by new development • The cost of existing public facilities improvements • Adjustments to the cost of the public facilities for past or future payments made or reasonably anticipated to be made by new development • The availability of other public funding sources • The method by which public facilities improvements were financed These rate studies should be updated periodically to reflect changes in the cost of facilities.

While local governments are not required to

hold a public hearing before adopting or increasing impact fees, it may be prudent to do so, especially if the decision might be controversial.

Local governments may provide exemptions for low-income housing and other development activities with “broad public purposes” (RCW 82.02.060). Some jurisdictions reduce or waive certain types of impact fees for certain types of development, either to incentivize development or because the development places no significant burden on existing facilities.

Practice Tip: Some jurisdictions automatically adjust their impact fees by indexing them, which protects future revenues and can potentially eliminate the need for the legislative body to go through a formal rate setting process again. For instance, see: • Federal Way Municipal Code Sec. 19.91.160 - Transportation impact fees indexed to a three-year moving average of the WSDOT Transportation Construction Cost Index. Rate study must be updated every three years, unless city determines that circumstances have not changed to warrant an update.

• Ridgefield Municipal Code Sec. 18.070.090 - Park impact fees indexed annually to Portland Consumer Price Index for first half of the year, but may only increase automatically for three consecutive years.

If fees are set to automatically increase for a fourth consecutive year, city council must hold a public hearing and establish new impact fee rates. Note that the Portland-Salem CPI index has been eliminated effective January 1, 2018.

• West Richland Municipal Code Sec. 16.14.105 - Park impact fees indexed annually to Seattle Metropolitan Area Consumer Price Index and rounded to the nearest five dollar increment. (Similar provision for transportation.)

Please note: There have been several geographic changes to the CPI indexes beginning January 1, 2018. For more information, see our page Consumer Price Index.

Collecting Impact Fees

Impact fees generally must be paid before construction begins. The money must be earmarked and retained in special interest-bearing accounts, with a separate account for every type of facility for which the fees are collected (schools, fire, etc.). Each agency that imposes impact fees must provide an annual report on each of the accounts showing the source and amount of revenues, as well as the improvements financed with the revenue (RCW 82.02.070). For information on accounting requirements for impact fees, see the GAAP BARS Manual, section 3.6.7 (no equivalent section in the Cash Basis BARS Manual).

Effective September 1, 2016, ESB 5923 (codified at RCW 82.02.050) required cities, towns, and counties to adopt an impact fee payment deferral system for small single-family residential developments, allowing developers to pay the fees after construction instead of beforehand. For details and examples, see Impact Fee Payment Deferral Programs.

Deadline for Expending Impact Fees

Impact fees must be expended or encumbered within 10 years of receipt, unless there is an “extraordinary and compelling reason” for fees to be held longer, which must be documented in writing by the governing body (RCW 82.02.070).

RCW 82.02.080 requires each jurisdiction to refund the impact fees, plus earned interest, to the developer if: • The impact fee is not expended or encumbered within 10 years of collection; • The jurisdiction ends its impact fee program and the funds have not yet been expended or encumbered; or • The developer does not proceed with the proposed development activity and requests a refund.

The Puget Sound region is booming with new development, more residents and jobs, and demand for increasingly stretched public services, whether they be roads, transit, schools, or parks. Many jurisdictions require new development to pay impact fees to partially supplement capital funding to construct new facilities for these services. Seattle, however, is one of the few cities that does not impose impact fees for transportation or schools.

Seattle does have Mandatory Housing Affordability (MHA) and will expand that today, which is essentially an impact fee for affordable housing. Seattle also has a fee for sewer and electrical hookups, which are technically a form of impact fee but not in name. Under state law, impact fees can be used to pay for road improvements, school expansions, park and open space acquisition, and new firehouses.

Opinions on impact fees vary widely. Some boosters suggest that “new growth should pay for growth”–or put another way: that growth should pay for the new impacts to services that growth can create. Some hope that impact fees will curb new development.

Detractors think they are designed to punish developers and that the costs are passed on in the form of higher housing prices. And some simply think that general taxation (e.g., property tax) is a fairer way to pay for growth.

However, the professional planning opinion locally, nationally, and globally sit squarely in favor of impact fees. Additionally, the economic research suggests that impact fees are a form of land value capture, causing lower land prices rather than higher housing costs.

While there is evidence that impact fees can

Chalk Line • 11

increase housing prices, research suggests that may actually be due to the additional services they provide. After all, well-funded schools often correlate to higher housing prices. Overall, planners and community members often see the policy is a fair way to fund the additional services needed due to growth.

Washington Statute on Impact Fees

In Washington state, impact fees are authorized under Chapter 82.02 RCW. The purpose of impact fees is to provide a financing tool for developing system improvements that will serve new development. The statute, however, is clear that impact fees must not be solely relied upon for financing new improvements. Instead, there must be a “balance between impact fees and other sources of public funds.” The statute is also clear that impact fees cannot be imposed arbitrarily or in a duplicative manner for existing impacts.

They must be designed so that the impact fee cost is proportionate to the benefit that new growth and development will receive from improved and expanded public services.

There are also other clear limits to what impact fees can be imposed on and used for.

Statute narrowly allows impacts fees for four categories of public facilities (owned or operated by a public agency): 1. Public streets and roads; 2. Publicly-owned parks, open space, and recreation facilities; 3. School facilities; and 4. Fire protection facilities.

Cities and counties that choose to impose impact fees must establish specific system improvements in their capital facility plans (CFP), an element of their comprehensive plan. In doing so, CFPs must clearly identify the following: 1. Deficiencies present in public facilities serving existing developments; 2. How deficiencies are planned to be eliminated within the next six years; 3. Demand that new development will create for existing public facilities; and 4. Needed public facility improvements to properly serve new development.

The golden rule to impact fees is that they must be fairly charged to new development.

That means in developing a fee schedule, jurisdictions must look at use types and evaluate the kind of impacts that they create.

Residential uses, for instance, generally create a wider range of chargeable impacts than other categories of uses–such as schools, churches, and manufacturers–on parks and emergency services. Even individual categories of residential uses and occupancies may functionally operate differently, such as studio apartments versus five-bedroom single-family homes, and thereby present different demands.

12 • Chalk Line

Generally, impact fees are not collected until a building permit for a development is issued. In some cases, they can be further delayed. Statute also allows for impact fees to be exempted or reduced for low-income and affordable housing. Sound Transit also shares in exemption from all impact fees for buildings and structures built by or on behalf of the transit agency.

Impact fees are taxes, not a form of land use regulation. The characterization of GMA impact fees as taxes is important because taxes are not subject to vesting rules or the statutory limitations applicable to land use regulations. Impact fees are still subject to the statutory limitations imposed on excise taxes, as well as the limitations found in the GMA itself.Under Washington law, GMA impact fees are properly characterized as a tax rather than as a land use regulation. The primary purpose of GMA impact fees is to raise revenue, not to dictate land use. See Hillis Homes v. Snohomish County, 97 Wn.2d 804 (1982). This -5-characteristic of impact fees is clearly stated in the definition of “impact fees” set forth in RCW82.02.090:A payment of money imposed upon development as a condition of development approval to pay for public facilities needed to serve new growth and development.RCW82.02.090(3) (emphasis added). A 1999 Court of Appeals decision followed the Hillis Homes analysis to hold that GMA impact fees “augment” tax dollars and are not intended to regulate development in the manner of a land use control ordinance. New Castle Investments v. City of LaCenter, 98 Wn. App. 224, 231 (1999 Div. II), rev. denied, 140 Wn.2d 1019 (2000) The Thurston County Superior Court, in the first impact fee case litigated in Washington State, agreed that impact fees are taxes. See Olympia Master Builders v. City of Olympia and the Olympia SchoolDistrict, No.92-2-02215-7.

The Washington Supreme Court has not directly addressed the legal classification of GMA impact fees. Indeed, in City of Olympia v. Drebick, involving whether the calculation of impact fees may be based on area-wide infrastructure improvements rather than on the direct, specific impact of a particular development, the Court determined it did not need to determine whether impact fees are taxes or regulatory fees for the purpose of its decision Olympia Master Builders v. City of Olympia and the Olympia School District, No.92-202215-7, Thurston County Superior Court (1993).In the first case litigated in Washington State on GMA impact fees, the Olympia Master Builders (“OMB”) filed an action against the City of Olympia (“City”) and the Olympia SchoolDistrict (“District”) in Thurston County Superior Court. OMB sought to

have the City’s parks, fire, and school impact fee ordinance declared invalid. None of OMB’s procedural or constitutional challenges were successful. With respect to OMB’s procedural challenges, the Court found that OMB lacked standingto bring a SEPA challenge because it failed to produce evidence demonstrating a likelihood of adverse environmental impacts resulting from the collection of impact fees. In the alternative, the Court found that the City’s determination of nonsignificance was not clearly erroneous. Furthermore, the Court made it clear that a city, town, or county can base a school impact fee ordinance on rate studies submitted by a school district without violating prohibitions against unlawful delegation, and that a city, town, or county can enter into an interlocal agreement with a district to ensure the proper application and expenditure of the impact fees collected. Finally, the Court rejected the challenges to the City’s park capital facilities plan and concluded that provisions in the ordinance to address past taxes did not violate the GMA. OMB also challenged the school impact fee ordinance based on several constitutional claims. OMB argued that the ordinance violated due process and equal protection because school impact fees are based on the type, rather than the size, of the dwelling units. OMB asserted that impact fees based on square footage or the number of bedrooms would be reasonable, but impact fees imposed uniformly on single family or multi-family residences were not.

OMB also argued that the ordinance violated equal protection, because school impact fees are collected only from the developments within both the City and District; developments outside the City, or inside the City but outside the District, do not pay school impact fees.

OMB’s equal protection argument, had it been successful, could have created new challenges for assessing school impact fees in districts located in more than one jurisdiction. In most cases, the boundaries of school districts do not coincide with city or county boundaries. OMB argued, in effect, that school impact fees cannot be collected until every city, town, and county within the school district enacts a school impact fee ordinance. The Court rejected this argument, finding that equal protection guarantees apply within jurisdictions.

As long as the City of Olympia treats its own residents equally, it is not a matter of constitutional concern that City residents may be taxed more heavily for schools than non-City residents.

Every year in the fall, when our local jurisdictions begin considering their budgets and financial policies, we enter impact fee season.

OMB Members that Renewed in August & September 2020 ONE YEAR All Ways Gutters, LLC Doyle Construction LLC Jim Henry Design Services, Inc. John L. Scott – Centralia Precision Patio Covers Sutter Metals, LLC West Coast Mechanical Solutions, LLC Zemar Construction

2-4 YEARS American Workforce Group, Inc. BMC Holdings, Inc. Brio Construction, LLC Capital One Chehalis Rentals Curb Master, Inc. Gorman Roofing Services Hansen Construction Group International Wood Products Jackie Ashley RE/MAX Northwest Realtors PIONEER Technologies Corporation Tanglewilde Lumber, Inc. The Land Developer, LLC

5-9 YEARS Bakala Insurance Agency CRMA Construction, LLC D&R Communications, Inc. Double Duty Land Management, LLC Edward Jones Investments Eurocraft Painting, LLC FGM Construction & Development M & C Drywall, Inc. Prime Lending - Lacey Shield of Armor Safety & Risk Management Valley Supply Company Winston Quarry, Inc.

10-14 YEARS Always Safe & Lock, Inc. Bliss & Skeen Certified Public Accountants DB&R, Inc. Erik Jensen Reichert Shake & Fencing, Inc. Virgil Adams Real Estate, Inc.

15-19 YEARS Capital City Stove & Grill Center Capitol Lumber, Inc. Dr. Roof, Inc. Goebel Septic Tank Service, Inc. Johnston Construction Company, Inc. Labor Works, Inc. P & P Investments Tyler Rental, Inc.

20-24 YEARS Acme Fuel Company Andrew Spear Construction, LLC Drebick Investments, LLC Harrington Construction & Development, Inc. Lindstrom & Son Construction, Inc. Scott Homes, Inc. Washington Cedar & Supply Company

25 + YEARS Desco Audio & Video DeTray's, LLC Doors Unlimited, Inc. Hatton Godat Pantier Holroyd Company, Inc. Kaufman Construction & Development, Inc. Rainier Valley Construction Strategy Insurance Brokers, LLC Kell-Chuck Glass Company, Inc. First American Title Insurance

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JANUARY 1st NEW YEARS DAY 6th Grays Harbor Chapter 6th Membership Committee 6th Spike Committee 8th Member Benefits Orientation 12th Exec/Board Meeting 14th Beer with a Builder 18th MLK JR. DAY 20th Lewis County Chapter 21st General Membership Meeting 27th Quarterly Building Officials 28th Government Affairs

OMB CLOSED 5:30pm 12:00pm 4:00pm 12:00pm 4:00pm/4:30pm 4:00pm OMB CLOSED 6:00pm 11:30am-1:00pm 12:00pm 4:00pm

FEBRUARY 3rd Grays Harbor Chapter 3rd Membership Committee 3rd Spike Committee 9th Exec/Board Meeting 11th Beer with a Builder 15th PRESIDENT’S DAY 17th Lewis County Chapter 25th Government Affairs

5:30pm 12:00pm 4:00pm 4:00pm/4:30pm 4:00pm OMB CLOSED 6:00pm 4:00pm

MARCH 1st-3rd 3rd 3rd 3rd 9th 11th 17th 18th 25th

BIAW Board Meetings Grays Harbor Chapter Membership Committee Spike Committee Exec/Board Meeting Beer with a Builder Lewis County Chapter General Membership Meeting Government Affairs

Olympia 5:30pm 12:00pm 4:00pm 4:00pm/4:30pm 4:00pm 6:00pm 11:30am-1:00pm 4:00pm

APRIL 7th 7th 7th 9th 13th 16th 17-18th 21st 22nd 28th

Grays Harbor Chapter Membership Committee Spike Committee Member Benefits Orientation Exec/Board Meeting Home Show Vendor Setup Big Home and Garden Show Lewis County Chapter Government Affairs Quarterly Building Officials

5:30pm 12:00pm 4:00pm 12:00pm 4:00pm/4:30pm 7:00am-7:00pm 10:00am-5:00pm 6:00pm 4:00pm 12:00pm

MAY 5th 5th 5th 11th 13th 19th 20th 27th 31st

Grays Harbor Chapter Membership Committee Spike Committee Exec/Board Meeting Beer with a Builder Lewis County Chapter GMM—REX Awards Government Affairs MEMORIAL DAY

5:30pm 12:00pm 4:00pm 4:00pm/4:30pm 4:00pm 6:00pm 6:00pm 4:00pm OMB CLOSED

JUNE 2nd 2nd 2nd 4th 7th-9th 15th 16th 24th 25th

Grays Harbor Chapter Membership Committee Spike Committee Education Foundation Auction BIAW Board Meetings Exec/Board Meeting Lewis County Chapter Government Affairs GMM—Member Appreciation BBQ

5:30pm 12:00pm 4:00pm 5:30pm Suncadia 4:00pm/4:30pm 6:00pm 4:00pm 11:00am

14 • Chalk Line

JULY 5th 7th 7th 9th 13th 23rd 22nd 28th

INDEPENDENCE DAY OBSERVED Membership Committee Spike Committee Member Benefits Orientation Exec/Board Meeting Golf Tournament Government Affairs Quarterly Building Officials

OMB CLOSED 12:00pm 4:00pm 12:00pm 4:00pm/4:30pm 9:00am 4:00pm 12:00pm

AUGUST 4th 4th 10th 12th 14-15th 26th

Membership Committee Spike Committee Exec/Board Meeting Beer with a Builder Backup Home & Garden Show tbd Government Affairs

12:00pm 4:00pm 4:00pm/4:30pm 4:00pm 10:00am-5:00pm 4:00pm

SEPTEMBER 1st Grays Harbor Chapter 1st Membership Committee 1st Spike Committee 6th LABOR DAY 14th Exec/Board Meeting 15th Lewis County Chapter 16th Chefs on Tour 18th Tour of Homes 19th Tour of Homes 23rd General Membership Meeting 23rd Government Affairs

5:30pm 12:00pm 4:00pm OMB CLOSED 4:00pm/4:30pm 6:00pm 4:00pm-9:00pm 10:00 am-5:00pm 10:00 am-4:00pm 11:30am-1:00pm 4:00pm

OCTOBER 6th Grays Harbor Chapter 6th Membership Committee 6th Spike Committee 8th Member Benefits Orientation 12th Exec/Board Meeting 14th Beer with a Builder 20th Lewis County Chapter 21st GMM—Tour Awards 27th Quarterly Building Officials 28th Government Affairs

5:30pm 12:00pm 4:00pm 12:00pm 4:00pm/4:30pm 4:00pm 6:00pm 6:00pm 12:00pm 4:00pm

NOVEMBER 3rd Grays Harbor Chapter 3rd Membership Committee 3rd Spike Committee 9th-11th BIAW Board Meetings 11th VETERANS DAY 16th Exec/Board Meeting 17th Lewis County Chapter 18th GMM—Homebuilders Expo 25-26th THANKSGIVING

5:30pm 12:00pm 4:00pm Hyatt Lake OMB CLOSED 4:00pm/4:30pm 6:00pm 5:00pm OMB CLOSED

DECEMBER 1st Grays Harbor Christmas 1st Membership Committee 1st Spike Committee 10th Christmas Party 14th Exec/Board Meeting 15th Lewis County Chapter 24th-31st CHRISTMAS EVE –NEW YEARS EVE

5:30pm 12:00pm 4:00pm 6:00pm 4:00pm/4:30pm 6:00pm OMB CLOSED

Events Meetings Holidays

*Dates and times are subject to change.

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1211 STATE AVE. NE OLYMPIA, WA 98506 $1.25 per copy 360-754-0912 800-456-6473 www.omb.org