Temporary Suspension of Federal Way Impact Fees for Change in Use

Federal Way City LogoThe Federal Way City Council has decided to suspend transportation impact fees on local businesses until December 31, 2017. Due to the economic downturn, in December 2011 the City Council passed a 3-year temporary suspension of transportation impact fees charged for changes in use that do not add new square footage. To encourage and promote development activity, the Council accepted Mayor Jim Ferrell’s recent proposal to extend the temporary suspension for another three years. 

The temporarily suspension until 2017 may help to attract new businesses to fill vacant buildings and generate additional tax revenue for the City. City spokesman Chris Carrel said, “It’s all about keeping business here, being successful and being able to eventually expand. We hope that this is seen as attractive, not only to businesses here, but to people considering doing business in Federal Way.”

On July 1, 2010, the City implemented the current Transportation Impact Fee (TIF) program that requires new developments to pay their proportionate share of the cost of new facilities to serve new development. This program, which is authorized by RCW 82.02, provides predictability, simplicity and generally results in lower traffic fees than the alternative of SEPA- based pro-rata mitigation systems.

Under the Transportation Impact Fee program, the City also collects transportation impact fees on all redevelopment of existing buildings (involving changing from one use to another use) if the redevelopment increases the number of vehicle trips generated. For example, the redevelopment of an existing drive-in bank to a real estate brokerage and property management company would pay an impact fee based on the net difference between the two uses if the real estate company generated more traffic than the drive-in bank.