In 1995, the state Legislature enacted a number of regulatory reform measures in ESHB 1724 that were aimed at improving the local government land use permitting system. Such reforms addressed timelines for local permit decisions, as well as a number of other reforms designed to improve and focus public involvement during the local land use decision-making process.

The legislature specifically required those cities and counties who plan under the Growth Management Act (GMA) to "experiment" with processing land use permits within no more than 120 days, and waived legal liability for failing to meet the deadline. This "experiment" , both the permit timelines and liability waiver, is due to expire in statute by July 1, 1998.

The Land Use Study Commission is responsible for reporting back to the 1998 Legislature on how this "experiment" has worked.

Essentially at issue is whether or not the 120-day permit processing or other such timelines should be enacted before they expire. If they expire, GMA-planning local governments would be required to adopt their own locally determined timelines and the liability waiver for failing to meet them would reappear.

Prior to the 1995 legislative session, local government, business and citizen activist interests debated whether or not a series of reforms proposed by Governor Lowry’s Regulatory Reform Task Force were warranted, worthwhile and necessary for adoption by the Legislature. Among items debated was a proposed new requirement that GMA-planning jurisdictions would have to establish a maximum 120-day time limit for the issuance of local permits.

"During development of the Task Force’s recommendations, the concept of a maximum time limit in which to issue permits came up repeatedly and was opposed by most jurisdictions but supported by the business and development community. They wanted accountability, but local jurisdictions feared state intrusion into the complex and politically volatile area of land development. They believed that a maximum time limit was a simplistic solution to a complex problem and would remove local discretion to review permits according to local requirements. In addition, they argued that the

percentage of permits denied would increase because most jurisdictions would likely deny a permit that had reached the maximum time rather than issue it without adequate review. They were also concerned that a requirement to process any permit within prescribed timelines would cause staff resources to shift to the more complex project reviews - thus causing delays in the smaller less complex applications.

As a consequence of these concerns, the 120-day time limit was considered somewhat of an experiment and received special attention on two accounts. First, the Land Use Study Commission (LUSC) , was directed to monitor local government efforts to consolidate permit procedures and the effectiveness of the timelines including the 120-day clock. Second, ESHB 1724 contained a sunset clause for the 120-day time limit as of June 1998. The LUSC is to report to the 1998 Legislature on whether to continue, modify or extinguish the 120-day time limit. Unless the Legislature acts, the sunset clause will automatically end the 120-day clock requirement.

The LUSC established the Permit monitoring Advisory Committee (Advisory Committee), and sponsored two (2) survey techniques, as well as encouraging the LUSC to retain the help of consultants in this evaluation.

In the summer of 1996 - shortly after the April 1, 1996 date on which GMA-planning jurisdictions were to implement the permit time limits, the LUSC conducted a statewide survey of city and county governments to establish baseline conditions on how local permit processes worked prior to implementation of reforms. Of the 252 survey mailed out, 67 (26.5%) were returned. Sixteen of Washington’s 39 counties responded. Of the 213 cities, 51 responded. A summary of survey findings is provided as ATTACHMENT A.

To gain more in-depth information on how reforms with ESHB 1724 were working,

the Advisory Committee worked with a consulting group from David Evans & Associates, Inc. and the Langlow Associates, Inc.to conduct a case study analysis of representative communities throughout the state. In the Spring of 1997, the following

thirteen (13) jurisdictions were studied to provide information on, and analysis of, the effects of implementation of ESHB 1724, particularly with respect to the 120-day permit processing time limits.

COUNTIES: Clark, Douglas, King, Pacific, Pierce and Yakima

CITIES: Colville, Granite Falls, Kennewick, Kent, Olympia, Ridgefield and Seattle

At the September 9, 1997 LUSC meeting in Seattle, representatives of the Consultants and Advisory Committee presented their findings to the Commission. SEE THE EXECUTIVE SUMMARY OF THEIR FINDINGS AS ATTACHMENT B (A full copy of their Report is available upon request from the LUSC). These findings present issues and observations not only on the 120-day permit timeline issues, but also on experiences with other permit review and processing reforms mandated in ESHB.

Local government permit processing reforms mandated by ESHB 1724 for cities and counties planning under the GMA went into effect in the Spring of 1996. A specific description of what was required is included as ATTACHMENT C (originally prepared for distribution to affected cities by the Association of Washington Cities).

Local governments have had approximately one and one half year’s experience with implementation of these mandated reforms. As revealed in the August 1997 Permit Monitoring Case Study Report prepared for the Commission, experiences-to-date within the thirteen representative jurisdictions, have been generally positive, but not without problems. In the Conclusion of their report, they state:

"It is still early in the implementation process and the experiences of all are affected as procedures are smoothed out. In addition, the sample of jurisdictions and stakeholders was small. Nonetheless, the Permit Monitoring Case Study has revealed some important information about how well this portion of the Regulatory Reform Act is meeting its original objectives. The greatest benefit has probably been in reducing permit timelines in King County, and in improvements in the quality and consistency of applications up front, through completeness review.

According to the permit case studies and jurisdictional data, most jurisdictions appear to be approving permits well within the 120-day timeline. Of the four permit cases not approved within 120 days, three were in King County, and the reasons were related to problems within the jurisdiction, not ESHB 1724. However, these approval timelines in most jurisdictions are in fact longer for many applications (especially for simpler permits) in most of the jurisdictions than before ESHB 1724.

Furthermore, jurisdictions and some stakeholders feel that in many cases the quality of review has suffered from increased attention to process rather than to content, particularly where local resources have been stressed to meet the additional workload.

There were many comments that the 120-day clock is unnecessarily inflexible and does not take into account the relative complexity of different types of projects. Other stakeholders feel that the 120-day clock is a sham, and, combined with vague criteria for completeness, is used to avoid having to meet the deadline.

Several comments were made regarding the timelines for Where projects are not approved within 120 days, the sticking points seem to be review by state or other agencies. The information provided was insufficient for an in-depth analysis, and may require further investigation to determine whether approvals are being conditioned on or delayed by state agency approvals or review. , delays caused by the need for additional work by applicants.

Despite improvements in public notification, stakeholder groups expressed dissatisfaction with the timing and content of public notices. Delayed notification with short appeal times is a problem exacerbated by the consolidated appeals process, which limits appeals to one open record hearing.

When asked about options that the LUSC and the State Legislature should consider, most respondents jurisdictions opted preferred for the return of more control to the local jurisdictions level. or increased flexibility, within a state framework. Most stakeholders expressed a desire to retain the existing provisions with some refinements.

There were no vivid distinctions between responses from jurisdictions withinon the western and eastern portions of the state. In a few instances there were similarities in responses among the four eastern jurisdictions, such as staff preferring a return of control over permitting to the local jurisdiction, but often the views were also expressed by one or more jurisdictions in western Washington. There may have been more consensus among the eastern jurisdictions than among the western jurisdictions on some questions, but this also sometimes correlated more to the relative sizes of their staffs and permit volumes than to their location.

In conclusion, it would appear that there have been many unintended and unfortunate consequences of this portion of the Regulatory Reform Act. While there have been some benefits, there is also a general sense that some problems were exacerbated, rather than solved, by ESHB 1724 because the legislation did not allow sufficient flexibility or provide sufficient resources to jurisdictions to address local implementation issues."

The Report then suggests that the Commission and other interested parties consider the following possible next steps:

"The results of this report suggest a number of activities that could assist the LUSC in considering amendments to ESHB 1724. The suggestions raised by the jurisdiction and stakeholders interviews include:

Create guidelines for completeness review and for circumstances under which the clock is stopped and started.

Consider refinements to mandatory timelines to make allowances for local circumstances, and shortening times to SEPA determinations on simple permits.

Consider making funding available to assist jurisdictions in implementing ESHB 1724.

Investigate issues around the consolidated appeals process, particularly with respect to open-record hearings before non-elected bodies.

Investigate more thoroughly the reasons for delay attributed to state agencies.Mandate state agency review and response times.

Investigate more thoroughly why stakeholders feel they do not receive sufficient notification.

Investigate more thoroughly how the 120-day clock stops and starts. Evaluate alternative systems for staff tracking the 120-day clock and ways to improve understanding among stakeholders of how the clock operates.Discuss the 120-day timeline with stakeholders to determine why they feel "duped" by the fact that jurisdictions can stop the clock under certain circumstances and whether a different system would be preferred."

Following presentation of this information before the LUSC at their September 9, 1997 meeting, Commission members were "polled" by the Chair on their reactions. Universally, members verbally indicated concerns with modifying the current system without the benefit of additional time for jurisdictions to work through some of the issues.

* Acknowledges most cities and counties met mandated 120-day permit timelines prior to 1995 and that even without a legislative mandate, such timelines will continue to be met.

* Other "reforms" from the 1995 legislation remain in effect and can be modified at a later date, if necessary.

* Returns local discretion on establishing permit timelines that are sensitive to local

staffing, resources and needs. Furthermore, by not re-implementing permit timelines of one sort or another, the legislature would not be subject to local government requests for funding to support mandated efforts.

* Re-institutes statutory liability for failing to meet permit timelines.

* Removes legislative directive to local governments to issues a variety of land use permits within a timely manner.

* Fails to recognize that the 120-timeline has prompted (or helped prompt) larger jurisdictions to speed up permit turnaround times.

* Re-institutes statutory liability for failing to meet permit timelines.

Option 2: Reaffirm 120-day Permit Timelines and the Liability Waiver for Failing to Meet Such Deadlines (Current Law)

* Maintains Status Quo for a time certain and requires further analysis/evaluation of

local experiences prior to further fine tuning.

* Provides an opportunity for all interested parties to focus on positive/harmful

aspects of this "experiment" while benefiting from an additional 2 years of

implementation.

* Avoids local government opposition to imposition of mandates without full or sufficient funding - at least for the next 2 years.

* Ignores identified concerns with the existing "reforms" - at least for 2 years.

* Necessitates further study and evaluation devoid of a specific "sponsor" organization such as the LUSC.

* A further study requires staff and fiscal resources.

* The liability waiver is maintained for failure to meet 120-day permit processing timelines.

* Maintains Status Quo Indefinitely

* Doesn’t require further study or analysis

* Fails to consider potential changes designed to improve the permitting system

` from the perspectives of local government, applicants and the interested public.

* Maintains Status Quo issues without a "plan" on how to address them.

Option 3: Maintain 120-day Permit Mandate and Re-institute Liability

* Reaffirms legislative mandate to the 120-day Timelines

* Reintroduces fiscal penalties to local governments failing to meet deadlines

* Insure large and complicated projects will receive priority for permit processing.

* Fails to acknowledge shortcomings with the 120-day timelines and associated issues raised by local governments, applicants and the interested public.

* Unless fully funded by the legislature, allows local governments to raise the issue

of unfunded mandates - especially with the re-imposed threat of fiscal liability for

failure to meet deadlines

* Fails to study further opportunities to improve the permitting and public input process.