What the building industry will watch for in Olympia

Proposed legislation promises to take on-the-ground realities into account in order to improve process

Avaly Scarpelli

The building industry is eager for the predictability that several bills still active up in Olympia promise to deliver. We believe that vesting stability, improved accuracy on buildable lands accounting, and proper time for implementation and assessment of building codes will benefit a large swath of the Southwest Washington business community. Of course, as is often the case, compromise is also required in the world of governance.

Predictability is definitely the name of the game for Senate Bill 5212, sponsored by our own Senator Wilson. SB-5212 addresses the rules that a property owner must follow when they develop and use their property (i.e. their vested rights). Are the rules that guide the process established when a permit is issued or can they change along the way as the project unfolds? According to bill analysis prepared for the House of Representatives, “Vested rights in the context of land use law refers to the rights of a property owner to develop and use his or her property in accordance with the laws and regulations governing the division, use or development of real property in effect on a date certain.” As Senator Wilson pointed out in testimony while presenting her bill, “You don’t change horses midstream.”

This idea that you don’t change the rules in the middle of the game was judicially created and the Legislature codified it in many ways over the years, including the creation of the State Building Code Act in 1985. Case law flowed out of these and for the last 30 years the development community – including cities, counties and individuals – understood that a structure or subdivision needed to follow the zoning and other land use control ordinances in place on the date of application.

Recently the courts have been inconsistent in interpreting what this meant, and this has caused confusion for the business community. Some cases before the courts got vested, while others did not. Most notably, in January 2016 the BIA, along with 25 cities and counties, won a case before the Washington Court of Appeals who ruled that stormwater rules are land use ordinances subject to the vested rights doctrine and that the Clean Water Act does not trump vested rights. In December of last year, the Washington Supreme Court reversed this decision.

The development community turned to our elected leaders to help protect the vested rights doctrine and the system of codes that has applied to land management for years. These laws matter and have a real impact on the success of building projects. Southwest Washington is booming with both public and private building projects. We need certainty, predictability and consistency from our land use laws.

Of course, with legislating comes compromise. HB-2023 is out of the House and before the Senate. This bill says that no vesting of any project or property can occur while an appeal to the Growth Management Hearings Board is pending. Currently, language in the law does allow projects to vest while an appeal is ongoing.

Speaking of growth management, SB-5254 recognizes that there have been inconsistencies in how cities account for their buildable lands supply, leading to an overestimation of available property. According to the Senate Bill Report, the goal of this bill is to “ensure adequacy of buildable lands and zoning in urban growth areas and provide funding for low-income housing and homelessness programs.”

The real estate community was very instrumental in drawing the attention of legislators to this matter.

“Many of our communities are experiencing market-rate and rental housing shortages especially in the hottest housing and employment markets of our state,” said Bill Clarke of Washington Realtors. “The buildable lands reports were established as an assessment tool to inform GMA comprehensive plans, but they are failing. SB-5254 changes the report requirements to ensure the reports reflect the reality on the ground: that market assumptions are realistic in identifying the readiness of properties for development or redevelopment; that infrastructure is available to support development; that environmental constraints are more accurately assessed; and that the reports are based on realistic market factors. This bill begins a more proactive effort to address housing shortages in our communities.”

Another bill that takes on-the-ground realities into account to improve process is SB-5500. This bill concerns the State Building Code Council and changes the code update cycle to six years rather than the current three-year term. Having additional time in between change cycles allows the industry to fully understand the code, get it implemented on the ground and provides important time to assess what is working (and what is not) before the next cycle of change gears up again.

The final bill we are tracking as a development community is SB-5239, also known as Fix Hirst. While the Hirst decision was immediately more problematic for other areas of our state, it still created a large cloud of uncertainty for local rural developers. On October 6, 2016 the Washington State Supreme Court ruled that counties planning under GMA (like Clark County) must make their own determination of available water before issuing a building permit. This means that these counties could not issue a building permit that depends on an exempt well – even when the Department of Ecology had declared that the well does not impair in-stream flows or a senior water right. The hydrological studies required to prove that a well doesn’t impact in-stream flows are so cost-prohibitive that rural land owners were essentially stopped from the ability to develop their asset. Domestic wells make up 1 percent of total water consumption in Washington state.

As it stands right now, none of the bills have been passed out of committee in the other chambers. However, by all accounts the likelihood of many special sessions before a budget is agreed to is high. Many of these bills may become law through the budget negotiations process. We applaud lawmakers for the work they have done thus far on drafting proposed legislation that matters to the Southwest Washington business community.

Avaly Scarpelli is the executive director of the Building Industry Association of Clark County.