Abutting Lot Decision: What Does it Mean?

The basis of Judge Barbara Mack’s decision overturning the City’s abutting lot ordinance was Washington State law. She wrote:

This decision is based on the plain words of the statute, and the following applicable cases: Citizens’ Alliance for Property Rights v. Sims, 145 Wn.App 649 (2008) (holding that the clearing limitations of a county ordinance were not reasonably necessary as a direct result of the proposed development, fell “within the scope of an indirect ‘tax, fee or charge’ on development,” and therefore violated RCW 82.02.020); Isla Verde Intern. Holdings, Inc. v. City of Camas, 146 Wn.2d 740 (2002) (holding that an open space set aside condition violated RCW 82.02.020, noting that the statute requires strict compliance); RIL Associates, Inc. v. City of Seattle, 113 Wn.2d 402 (1989), (a city ordinance that required owners of low income rental units to provide advance notice, eviction protection, and relocation assistance prior to demolishing or changing the use of residential units” was an indirect charge on development and thus violated RCW 82.02.020).

There is a lot going on in that paragraph, but here’s my lay persons take.

The City can regulate development but it cannot levy a tax, fee, or charge, direct or indirect on development because of RCW 82.02.020, the relevant section of which reads:

No county, city, town, or other municipal corporation shall impose any tax, fee, or charge, either direct or indirect, on the construction or reconstruction of residential buildings, commercial buildings, industrial buildings, or on any other building or building space or appurtenance thereto, or on the development, subdivision, classification, or reclassification of land.

That’s the plain language. The Judge agreed that forcing a builder to go through the expensive design review process amounted to an indirect fee on development. Why? The judge goes on to say (emphasis mine),

[The abutting lot ordinance] imposes direct and indirect costs that are neither reasonably necessary nor a direct result of the proposed development. It is hard to fathom how costs and fees could be reasonable and necessary for the smaller project, but not for the first, more impactful project on the adjacent property. The city appears to agree that the ordinance is designed to mitigate collective impacts, not the impact of any individual project.

I emphasize that phrase because from what I know (and I am not a lawyer), this is the limit on what the City can do. The City can charge for a water connection because it is “reasonably necessary” to require water service for health and safety. Other requirements limiting construction impacts, for example, fall within this category and within the police powers of a City. You can’t just block traffic unless you have a plan to mitigate the impacts, and the costs of that are “reasonably necessary.” These things I mention above are also a “direct result” of new housing.

Here’s the phrase some may have heard before: nexus and proportionality. State law, RCW 82.02.020 mandates that the limits of any City charge or fee on housing development, whether direct or indirect, depend on whether the charge offsets an impact that is related to the development and that the charge is “reasonable.” Much of this has been litigated and has created the case law cited by the Judge in her decision. Will Mandatory Inclusionary Zoning (MIZ) as the City has moved on it so far survive a legal challenge based on RCW 82.02.020? I’ll cover that it the next post.


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