City of Kent plans to cap school impact fees charged to developers

A dispute about the cost of impact fees that began last year between the city of Kent and Federal Way Public Schools has heated up again.

The Kent City Council is scheduled to vote at its 7 p.m. Tuesday, June 5 meeting to adopt a cap on impact fees charged to residential developers for all school districts within the city limits. The council’s Economic and Community Development Committee voted 3-0 on May 14 to recommend the full council approve the ordinance.

Kent wants a cap on impact fees of $8,386 for multifamily units and $8,229 for single-family units. Federal Way requested an impact fee jump last year to $20,086 per multifamily unit from $8,386 per unit in 2016. The council denied the increase, which was approved by King County, Federal Way and Auburn.

Federal Way requested the high impact fee increase last year because of four large multifamily apartment complexes constructed in the city that generated more than one student per unit. Three Federal Way Public Schools are in the city of Kent limits — Totem Middle School, Star Lake Elementary and Sunnycrest Elementary.

That large hike request caused city leaders to ask staff to look into a potential cap on impact fees, which are one-time charges assessed by a local government against a new development project to help pay for new or expanded public facilities (schools, roads, fire services, etc.) created by that development.

School districts are responsible for expending the impact fees but are not authorized to collect the fees, which cities do for the schools. School boards initially approve the fees.

“I don’t think this will be a surprise — Federal Way Public Schools strongly opposes this proposal,” said Sally McLean, chief finance and operations officer for Federal Way Public Schools, at the council’s committee meeting. “An artificial cap ignores the true impact of new residential development on school facilities and while certainly beneficial to private developers, it compromises our ability to provide needed capacity and shifts most of the funding burden to our existing shared taxpayers.”

McLean also showed up at a council meeting last year to oppose the council’s vote to limit Federal Way’s fee hike.

Kent city leaders want to avoid large increases in the impact fees so developers have a better idea of how much they will have to pay if they decide to build a residential project.

“Their (Federal Way) rates went way up — $8,386 was up $500 from the previous year and we accepted those,” said Hayley Bonsteel, city long range planning manager, in her report to the council committee. “The $20,000 fee proposed (last year for 2018), we didn’t move forward.”

Bonsteel said many school districts raise fees 2 or 3 percent. The council approved impact fees proposed last year by Kent, Auburn and Highline schools.

“We worked with the mayor’s office on this and used last year’s highest numbers to set our cap,” Bonsteel said.

McLean told the council committee the cap doesn’t work.

“We understand the city’s desire to protect its development community,” she said. “We hope the city will recognize new development permitted by the city greatly impacts school facilities, our scholars and our shared taxpayers.”

Bonsteel said the cap wouldn’t be an issue with the Kent School District whose fees are in the $2,000 range for multifamily and $5,000 range for single-family units.

Council President Bill Boyce and Councilwoman Satwinder Kaur asked city staff to reach out to Kent School District officials for their input about the impact fee. Bonsteel said the Kent School District didn’t respond to an initial request for comment.

In addition to McLean of Federal Way, Bob Kenworthy assistant director of capital projects for the Auburn School District, told the committee the cap won’t limit fees set by Auburn but that he agreed with McLean in opposing a cap.