New Buildable Lands Law Projected to Improve Data, Fill Gaps In State Housing Inventory

Governor Jay Inslee recently signed a bill into law which would increase the accuracy of buildable lands reports, a move that realtors and homebuilders say will help increase housing inventory across the state. Photo: Murderbike

Washington homebuilders and realtors are praising a new law that would clarify what land is considered buildable under Growth Management Act (GMA) comprehensive plan updates – a move stakeholders say will help address housing inventory shortages across Washington.

The Senate approved SB 5254 in a 47-2 vote on June 29. On the same day, the bill passed the House in a 85-9 vote, with four excused. On July 6, Governor Jay Inslee signed the measure into law.

State Sen. Joe Fain (R-47) is prime sponsor of the bill, and cosponsors include State Sens. Guy Palumbo (D-1), Hans Zeiger (R-25) and Steve Hobbs (D-44).

“The thing I was largely interested in…was finding a way to make buildable lands reports more valuable,” Fain told Lens, stating that previously, versions of such reports could contain inaccurate information that would actually make land unbuildable.

For example, land might be too steep or located adjacent to sensitive areas which would render it unable to be permitted, according to Fain. “If you are looking where to put developments, it completely falls apart if there is bad data…” he said.

Under the GMA, King, Snohomish, Pierce, Clark, Thurston and Kitsap Counties must establish a growth review and evaluation program, also known as the Buildable Lands program, to determine whether counties and cities are achieving urban growth within the urban growth area – a key requirement of the law.

The buildable lands report (BLR) compares actual growth and development with forecasted growth under the comprehensive plans. If there are any discrepancies between the two, counties and the cities within them are required to improve the accuracy of the projected and experienced growth figures.

“It is critically important to make sure these are actually valuable documents that can be used by both the private and public sector and help local governments find resources they can use to make sure these things get done properly,” Fain said.

Bill Clarke, a lobbyist for Washington Realtors, agrees with Fain.

Land might appear usable on paper but might lack infrastructure for water or sewage, he said, or there may be environmental concerns to consider such as being near wetlands or buffers – all of which compromise the usefulness of the land.

Clarke said it has previously been difficult to determine what land is buildable, and has proven frustrating to many, including homebuilders, who also support the new law.

“The bill’s passage represents a major step forward for the buildable lands process by ensuring greater accuracy of information used to plan for growth,” said Nick Harper, senior director of strategy and policy at the Master Builders Association of King and Snohomish Counties in response to SB 5254’s signing.

“More accurate buildable lands data should help our region do a better job of utilizing existing land supply and infrastructure to meet current and future housing demand,” he added.

Counties planning under GMA must update their comprehensive plan every eight years, but not every county is on the same update schedule. According to the bill report, local jurisdictions updating their GMA comprehensive plan before 2024 would need to complete their buildable lands report no later than two years before the final report is due.

Clarke said moving the deadline up will allow cities or counties to take advantage of lessons learned for the next plan update.

Among the law’s other requirements, local jurisdictions must review rules and situations which may affect development and identify areas of land which are no longer fit for development or redevelopment. Also zoning, development and environmental regulation data will be considered to better meet growth and development projections.

After the law takes effect, and up until December 1, 2018, the Department of Commerce must work alongside local governments and stakeholders to create guidance materials for updating the BLR process.

The law would also work to address shortages in the state’s housing inventory, according to Clarke, which has been a growing concern over the past few years.

“We will get a more accurate picture of how much buildable land is needed to meet population growth,” he said. “If there is adequate buildable land and density, then you can theoretically get the additional inventory you need. That’s how it’s supposed to work.”

According to recent data from the Northwest Multiple Listing Service (NWMLS), Washington’s housing inventory was down 14 percent in June 2017 with 14, 482 active listings compared to one year prior;  June 2016 had 16,838. This year, however, there was slight inventory improvement from May to June, when the figure jumped by 16 percent.

The sparse inventory was most noticeable in King County where less than a month’s supply of housing was available for purchase, whereas in a “balanced market,” inventory would be closer to a four- or six-month supply, according to the NWMLS release.

“The lack of inventory hurts everyone within the housing spectrum, from renters to first-time homebuyers to homeless to buyers,” said Clarke.

Under GMA, the Office of Financial Management (OFM) assigns population projections to each county, who then assigns it to each city. Clarke says cities should be able to absorb these demands with adequate buildable land.

“From a policy standpoint, we want to make sure more homes are built in the right areas to accommodate the growth our region has seen, but to do it in a way that is sensitive to environmental or infrastructure concerns,” said Fain.

An additional component of the bill becomes effective January 2018, which allows cities and counties to use additional tax funds to obtain, build or improve homeless housing facilities until June 30, 2019. Also, the current $40 surcharge for the Homeless Housing and Assistance Act would receive a four-year extension, which Clarke says is the main source of revenue for many local programs.

The law takes effect on October 19, 2017.

 

 

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