City council considers ways to spur local economy

By Stefanie Donahue

Are impact fees the key to revitalizing downtown and incentivizing growth in Blaine?

The question was at the heart of an hour-long discussion between Blaine City Council and city staff at a special meeting held July 24. Not yet ready to make a decision, council voted unanimously during a separate meeting that evening to request that city staff draft a proposal based on four types of impact fees and incentive programs – the council will either approve, deny or modify the proposal in a few months.

Impact fees are one-time charges that counties, cities and towns impose on developers. The funds are used to extend public services to support growth. In Washington state, impact fees can be used on public streets, roads, publicly-owned parks, open space, recreation facilities, school facilities and fire protection facilities. Impact fees and other development incentives have already been written into the Blaine’s comprehensive plan, which details how to accommodate growth over the next 20 years.

“These are things we’ve been looking at for a while,” said community development director Michael Jones. “The comprehensive plan and what you’ve already adopted recognizes the idea that there has to be enough financial capacity of the city to continue to do its job and provide the services and things that it needs to do while taking this into consideration.”

The city has already started developing a revised impact fee ordinance out of a request from the state legislature for all cities to adopt a deferral system so developers can pay fees after construction is complete, as opposed to before. Jones said it opened up an opportunity for the city council to revisit its existing code and consider an update.

Jones proposed seven types of impact fees, waivers and rebates, which council narrowed down to four. Moving forward, staff with the city will offer up a detailed proposal for the incentives and ask for a vote in a few months, Jones said. Below are the four options the council will consider:

Differential fee, based on geographic area/zone

This would establish multiple zones where impact fees are set at different levels. Rates could depend on miles traveled across city streets and the need for infrastructure, for example.

Differential fee, based on type of use 

Fees would be applied based on type of use. High-impact users, such as a trucking business, could face higher rates due to the impact on roads, while a high-grossing retail store that contributes large sums of tax revenue could pay a lower rate.

The city council could also consider a “pass-by trip reduction,” which would grant lower rates to businesses that draw customers who didn’t necessarily intend to visit, such as a gas station. These types of businesses tend to reduce impact on city services.

The fee has the risk of adversely impacting warehousing and transportation industries.

Rebate, based on use 

The city could provide a rebate for the impact fee over a set period of time based on sales tax revenue and overall performance, for example. The rebate could cover a portion or all of the fee, but could not exceed the original amount.

Residential fee waiver

The incentive could waive fees for downtown residential development in order to promote access to housing in the downtown core.

“I think the public has to understand how difficult this is. But we’ve got to try,” said city councilmember Harry Robinson about revitalizing Blaine’s downtown. “We’ve got to look under every rock that has a business underneath it.”