SB 5951, sponsored by Sen. Mike Braun (R–Centralia), has the stated goal of incentivizing property owners to develop residential and mixed-use properties for urban infill development on vacant or under-used urban parcels. The incentive comes in the form of property and sales tax exemptions.

SB 5951 allows cities, through a public process, to designate infill development areas that would benefit from additional mixed-use or residential housing, including affordable housing. Once designated, the city would then develop: an application process; requirements for site development, including demolition; and building requirements that will enhance the livability of the area. Any requirements adopted would not be subject to the Growth Management Hearing Board review until the city’s next GMA plan update; nor would any SEPA determination be subject to appeals.

Interested property owners could then apply to develop property in the designated infill development area. If approved and developed within three years of the application, property owners could apply for a property tax exemption for the added value to buildings according to this schedule:

• All developments must include a portion of affordable housing units, defined as units that rent or sell for less than the median price in the area.
• For multifamily residential developments in urban areas with at least 100,000 in population where the development results in a property density of at least 150 affordable units per acre, 100% tax exemption.
• For multifamily residential developments in urban areas with 50,001 to 99,000 in population where the development results in a property density of at least 75 affordable units per acre, 100% tax exemption.
• For multifamily residential developments in urban areas with 50,000 or less in population, where the development results in a property density of at least 35 affordable units per acre, 100% tax exemption.
• For mixed-use properties where at least half of the units are affordable housing, 75% tax exemption.

The exemptions expire in 2030. SB 5951 also provides a sales tax exemption for labor for qualifying infill developments.

AWC supports this bill. The proposal incentivizes private development while respecting the role of cities to plan for increased density in a way that will enhance their communities. This is a win for developers, a win for cities, and a win for both the new and current residents of the infill area.

Dates to remember

SB 5951 will be heard on Tuesday, February 19 at 8 am in the Senate Local Government Committee. It must get voted out of this committee by Friday to stay alive.