Spokane updates water and wastewater connection fee waivers to incentivize affordable housing

Spokane updates water and wastewater connection fee waivers to incentivize affordable housingThe city council has revised its General Facilities Charges (GFC) rules to offer up to 75% fee waivers for qualifying developments, concurrently accepting a $289,000 state grant for water and sewer infrastructure at a new 48-unit project.

The updated policy allows a 50% permissive waiver on water and wastewater GFCs for affordable housing projects that commit to a 40-year affordability covenant.

Eligible projects can receive an additional 25% waiver if they apply for state infrastructure funding but are denied due to a lack of available funds.

The city also formally accepted a $289,000 Connecting Housing to Infrastructure Program (CHIP) grant to fund water, sewer, and stormwater improvements for the Spokane Rise Apartments.

The Spokane City Council has approved an update to its public rules governing water and wastewater General Facilities Charges (GFCs), establishing a clearer framework for waiving and deferring connection fees to spur affordable housing development. The revised Public Rule (5200-25-01) aligns the city’s utility fee structure with Washington state law, allowing the municipal utility to grant a "permissive waiver" of up to 50% of standard water and wastewater GFCs. To qualify, developers must commit to a 40-year covenant restricting sales to households earning no more than 80% of the area median income, or limiting rentals to those earning 60% or less of the area median income. The updated framework also provides a safety net for developers seeking outside funding. Projects that meet the affordability criteria can receive an additional 25% GFC waiver if they apply for a Washington State Department of Commerce Connecting Housing to Infrastructure Program (CHIP) grant but do not receive an award due to a lack of state funds. Under the new rules, the maximum offset or deferral is capped at $40,000 for water GFCs and $20,000 for sewer GFCs per project, though there is no maximum limit for permissively waived charges. If a property is converted to a non-qualifying use before the 40-year covenant expires, all waived connection charges become immediately due at the rates in effect at the time of conversion. In a concurrent action demonstrating the city's strategy of leveraging outside infrastructure funding, the council voted 7-0 to accept a $289,000 CHIP grant from the Washington Department of Commerce. The grant will fund critical utility infrastructure for the Spokane Rise Apartments, a 48-unit affordable housing development in the Hillyard neighborhood. The scope of work includes the repair of 200 linear feet of an existing sewer main line, new sewer connections, and stormwater management improvements featuring roof drain lines, drywells, and a bio-retention facility for proper infiltration. The funds will also reimburse the city for waived water, sewer, and stormwater system development charges associated with the project. During the legislative session, Council Member Dillon specifically highlighted the CHIP grant award, praising the state funds for their role to "help support utility improvements for affordable housing."