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Financial incentives are intended to reduce the financial burden of carrying a loan through the review process and alleviate up-front financial costs to developers and builders associated with review and impact fees to reduce costs in exchange for providing affordable housing units.

A. Fee Reductions.

1. A multi-unit project meeting the applicability standards and general provisions of this chapter may request a reduction of the following permitting fees as set forth in Table 2.

Table 2. 


Maximum Reduction Allowed

Land use permit fee


SEPA review fee


Site civil construction permit fee


Building permit fee


All other fees not addressed in this chapter, including consultant deposits for third-party review or Hearing Examiner costs, may not be waived or reduced.

2. Impact and mitigation fees may be reduced for the eligible affordable housing units as defined herein. Fees for market rate units shall not be reduced. Reductions stated in Table 3 are the maximum allowable. Actual reduction amounts will be dependent on the level of service (LOS) and park and/or transportation system conditions in the area of the development, as determined by the Public Works Director.

Table 3. 

Impact/Mitigation Fee

Maximum Reduction Allowed Percentage of Affordable Units

25% or Less

More than 25%

Traffic impact fee



Park impact fee1



School impact fee



1Applications that receive a reduction in park impact fees shall not be eligible for a reduction in required open space.

B. Utility Connection Fees. Upon approval by the Planning Director, the collection of water and sewer connection fees under the provision of SMC Title 15 to serve housing units for eligible developments meeting the applicability and general provisions of this chapter and as set forth in subsection (B)(8) of this section may be reduced, based on the percentage of affordable units served by each utility meter.

1. Affordable units shall be intermixed throughout the development.

2. To qualify for a utility connection fee reduction, affordable units must serve one of the priority populations of RCW 82.14.530, now and as hereafter amended.

3. All reduction requests shall be made in writing to the Planning and Development Services Department prior to issuance of a land use approval for said project, or at least 30 days prior to levy of the connection fees, whichever occurs first.

4. Such requests may be granted only at such times as the City has established and funded a utility connection fee reduction fund through the sales and use tax of SMC 3.55.010 and not from funds received from payment of water and/or sewer utility rates (apart from taxes assessed thereon).

5. On an annual basis, and at such other times as the City Council deems appropriate, upon consideration for the number of potential requests for utility connection fee reduction requests under the provisions of this section, the City Council may determine by resolution or ordinance the appropriate amount available for utility connection fee reductions. Upon this determination, utility connection fee reductions or waivers shall be available on a “first-come, first-served” basis.

6. Upon the Planning Director’s approval of a utility connection fee reduction request, the connection fee amount that was reduced shall be paid from the appropriate fund designated for utility connection fee reductions. Any remaining fee that was not reduced shall be paid by the project applicant prior to issuance of a building permit pursuant to SMC Title 15.

7. Reductions can only be granted to the extent funds are available in the stated account.

8. The utility connection fee reduction percentage shall not exceed the percentage of affordable housing units served by the utility meter being connected, not to exceed the maximum reduction amounts set forth in Table 4. Fees for utility meters serving market rate units shall not be reduced.

Table 4. 


Maximum Utility Fee Reduction Allowed for Housing Units Served by Utility Meter

Water Utility Connection Fee


Water Capital Facility Fee


Water Installation Fee


Water Connection Administrative Fee


Water Recovery Contract(s)

0%; Not eligible for reduction

Sewer Utility Connection Fee


Sewer Capital Facility Fee


Sewer Inspection Fee


Sewer Connection Administrative Fee


Sewer Trunkline Special Development Fee

0%; Not eligible for reduction

C. Property Tax Exemption. A multifamily development providing affordable housing units may be eligible for a property tax exemption pursuant to Chapter 3.50 SMC. (Ord. 2480, 2024)