Joint City Council & PUCB Study Session: Legislative Agenda & Impact Fees (Oct 28, 2025)

On October 28, 2025, the Joint City Council and Tacoma Public Utility Board held a study session to review the 2026 legislative agenda and discuss the implementation of new development fees. Session items included federal and state legislative priorities presented by city staff, a discussion regarding a federal government shutdown's impact on local services, and a comprehensive presentation on proposed Transportation Impact Fees and System Development Charges (SDCs) for wastewater, stormwater, and transportation infrastructure. The meeting featured an executive session for litigation discussion before resuming for the fee presentations.

Consent Calendar

• No routine approvals or unanimous actions were recorded in the transcript for this study session agenda.

Public Comments & Testimony

• No formal public comment or testimony segments with external speakers were recorded in the provided transcript text.

Discussion Items

• 2026 Federal Legislative Agenda (General Government): Senior Government Affairs Officer Andrea Roper presented five priorities: (1) Preserving critical funding for Medicaid, ACA, SNAP, WIC, and social services to prevent cost shifts to the local level; (2) Infrastructure funding aligning with safety, mobility, and resilience, specifically extending the "Safe Streets and Roads for All" grant program (slated to expire in 2026) and funding the Phase Two Fishing Wars Memorial Bridge replacement; (3) Affordable housing funding and housing voucher support; (4) Community safety eligibility for non-sworn personnel (e.g., behavioral health co-responders) and modernization of frontline equipment; (5) Comprehensive immigration reform.
• 2026 Federal Legislative Agenda (TPU): Federal Relations Manager Lauren Adler presented TPU priorities including: unlocking award grant funds, tax credit eligibility, full staffing of the Low-Income Home Energy Assistance Program (LIHEAP), addressing supply chain costs, supporting Bonneville Power Administration competitiveness, carbon reduction via hydropower recognition, zero-emission transportation funding, maintaining poll attachment authority, streamlining FERC hydropower relicensing, expediting FEMA disaster relief, and securing funding for the dam/water storage project and WIFIA/DWDF.
• 2026 State Legislative Agenda (General Government): Senior Government Affairs Officer Alex McBain outlined priorities: preserving critical programs (Medicaid, food assistance, behavioral health) and backfilling for anticipated federal reductions; fiscal sustainability regarding shared revenues (liquor tax, CJAA); engaging the legislature on wastewater nutrient regulations; transferring state obligations for transport routes; studying a sidewalk utility pilot; and continued advocacy for transportation projects and the Fishing Wars Bridge.
• 2026 State Legislative Agenda (TPU): Community and Government Relations Manager Logan Barr presented priorities: statewide low-income assistance programs; carbon reduction and decarbonization policies; clean energy development and transmission issues; funding for water systems; and supporting a refundable tax credit for class three railroad maintenance.
• Federal Shutdown Concerns: Councilmember Walker expressed concern that the federal legislative agenda did not explicitly address the ongoing government shutdown and its impact on residents and local municipalities. Staff agreed to explore adding language to the policy document or creating a resolution to pressure the federal government.
• Franchise Fees Clarification: Councilmember Bushnell inquired about the authority to levy franchise fees on telecommunications. Staff clarified that state statute (amended in the late 90s) prohibits franchise fees on telecommunications and power, though they remain allowed for cable operators and certain other utilities.
• Climate Commitment Act (CCA) Coordination: Board Member Gallagher asked why CCA dollars were not mentioned as a specific project funding source. Staff explained that legislators prefer using the specific grant process for CCA projects rather than budget appropriations. Board Member Rumba suggested aligning with Pierce County on CCA usage.
• Transportation Impact Fees & SDCs: Public Works Director Jeff Jenkins and staff presented new fee proposals to address infrastructure growth under the "Home and Tacoma" initiative.
  • Need: The presentation identified three funding gaps: maintaining existing systems, growing capacity for density, and future nutrient regulation changes.
  • Transportation Impact Fees: Staff proposed fees based on 42 capital projects (approx. $459M) across six districts. Rates would apply to all land uses, with proposed exemptions/reductions (50% for affordable housing/ADUs near transit, 80% for low-income housing) that do not require repayment. Councilmember Diaz questioned if fees would cover administration costs; staff confirmed PDS would handle tracking and billing, though administration costs may rise.
  • System Development Charges (SDCs): Staff proposed SDCs for wastewater and stormwater to fund capacity upgrades. Compared to regional peers, Tacoma's proposed fees remain lower due to a lower cost basis for older infrastructure. A single residential unit comparison showed Tacoma's fees were third from the bottom regionally.
  • Off-site Improvements: Councilmember Bushnell and Councilmember Diaz raised concerns about the "cascade effect" of off-site improvement requirements compounding the cost of new development. Staff acknowledged these costs vary by jurisdiction and are separate from impact fees, though credits might be available if developers perform on-site improvements that align with the capital project list.
  • Stormwater Regional Facilities: Councilmember Bushnell asked about off-site stormwater facilities. Staff confirmed a $1M study is underway to analyze regional facility options to maximize buildable land.
  • Cost to Build Debate: Councilmember Diaz emphasized that while fees are necessary, the cumulative cost including permitting, off-site improvements, and impact fees (estimated at roughly $60k+ per unit) significantly impacts housing affordability and the city's ability to meet 2050 housing goals.
• Executive Session: The council convened an executive session (RCW 42.30.110) for approximately 30 minutes to discuss potential impending litigation regarding the fees.

Key Outcomes

• Vote Scheduled: The City Council and Public Utility Board are scheduled to vote on the 2026 legislative agenda on November 18, 2025.
• Fee Proposal Status: Staff propose to draft ordinances for the Transportation Impact Fees and SDCs with a target effective date in Quarter 2 of 2026. The ordinances are scheduled for a final council vote on December 2, 2025.
• Exemptions Codified: Staff proposed to codify specific fee reductions (affordable housing, ADUs) that do not require repayment under state statute, which received general support from council members for not overcomplicating administration.
• Litigation Discussion: An executive session was completed regarding potential litigation related to the new fee structures.
• Follow-up Required: Staff agreed to provide additional data on the cumulative cost of building in Tacoma (including off-site improvements), the specific impact of the federal shutdown, and a detailed comparison of regional off-site improvement costs to inform the ordinance drafting process.