Impact fees are charges assessed on new development, as a condition of approval, to pay for public facilities needed to serve new growth. The purpose and size of the fees must be reasonably related to the new development creating additional demand for public facilities. Currently, local governments fully planning under the Growth Management Act may impose impact fees for fire protection, parks, schools, and/or transportation facilities.

In 2015, the Washington State Legislature amended the statute governing impact fees to require local governments imposing impact fees to establish a deferral process for small constructors of residential development to delay the payment of impact fees for up to 18 months. All local governments imposing impact fees need to have adopted an ordinance bringing this into effect by Sept. 1, 2016.

The Department of Commerce and the Joint Legislative Audit and Review Committee are working to gather information to determine the success of this amendment in stimulating the growth of small residential constructors.