Olympia begins two-phased approach to harmonizing housing ordinances

Olympia has started working to update its zoning code and housing ordinances to comply with new state laws regarding middle housing.

At Thursday's Land Use and Environment Committee meeting, Joyce Phillips, the city's principal planner, provided an update on the multi-phase process.

Phillips mentioned that the city was awarded a $75,000 grant from the Washington State Department of Commerce to assist with the funding ordinance update process. She explained that changes to the state's Growth Management Act mandate some of this work, but the grant funding would help offset associate costs.

Phase 1 involves harmonizing the city's existing codes with a missing middle housing ordinance adopted in 2018 but later appealed.

The ordinance intended to allow housing types like duplexes, triplexes, and fourplexes citywide. In 2019, the Growth Management Hearing Board subsequently appealed and invalidated it.

According to Phillips, there were some delays in the implementation of the ordinance due to COVID and the appeal process in the courts from 2019 through 2023 to determine the legality of the same.

In 2023, the appeals were dismissed, and the missing middle housing ordinance was reinstated.

Phillips pointed out that the city code had been amended several times in 2018, and now there are instances where the two versions are both in effect, and some do not match or align with one another.

"We essentially have the middle housing ordinance in play, and the code with all of the subsequent changes that were made over that six-year time period, and they're both in effect," Phillips said.

"Through a process that's legally known as harmonizing, we will take the missing middle housing ordinance with the rest of them in municipal code that includes all of the changes that were made over that period," Phillips said. The staff identified where in the code that has discrepancies between the middle housing ordinance and the existing code.

She added that the city council will select which of the sections to use where there are differences between the two. The principal planner clarified that the council will not change it because they have been through their public process, public hearings, and council decisions.

Phase 2 work and barriers to affordable housing development

Phase 2 work will address new requirements from state laws like HB 1110 (middle housing). This would involve modifying key elements of the zoning code, design standards, and subdivision regulations.

Definitions will be revised to align with expanded housing type definitions from the Growth Management Act. The code will be amended to allow two units per in most areas or four units if at least one is affordable, with a 50-year affordability covenant. Density calculation and how units meet building codes will be addressed.

Opportunities for public feedback on preliminary drafts will be provided before recommendations go to the Planning Commission and City Council for approval. The goal is to adopt the updates by June 2026.

City Council member and Land Use and Environment Committee Chair Dani Madrone inquired if Phase 2 presented an opportunity to tackle additional longstanding issues. She referenced concerns raised recently by Homes First and South Puget Sound Habitat for Humanity about barriers to developing affordable housing in the city.

Madrone asked whether the city could leverage the Phase 2 process, which requires opening the code, also to get input from affordable housing builders on how regulations could better facilitate affordable options.

Phillips noted that staff intended to identify potential code barriers to affordable housing development as part of their grant deliverables. She said presenting this list of issues to an advisory committee of affordable housing stakeholders early in Phase 2 would allow the city to gather feedback on whether any barriers were missed or need further attention.

When discussing expanding the scope of issues addressed, Tim Smith, interim director of Community Planning and Development, clarified that Phase 2 focuses on zoning and development.

Smith acknowledged that the challenges raised by Habitat for Humanity related to infrastructure requirements like engineering standards, water/sewer extensions, and stormwater rules. He recognized that these technical development standards contributed significantly to overall housing costs.

Given the complexity involved in examining such issues, Smith suggested that once the "ground is moving forward" with Phases 1 and 2—addressing the required ordinance changes—the scope could be broadened to incorporate additional barriers like infrastructure standards.