The Capital Budget Committee on Feb. 25 heard substitute House Bill 14 91, a proposal to require cities that fully plan under the Growth Management Act to allow higher densities in designated station areas around commuter rail, light rail and bus rapid transit stops and to attach affordability requirements and incentives to that upzoning.

Committee staff summarized key elements: a rail station area is defined as within a half mile of a commuter-rail, light-rail or rail-trolley stop; a bus station area is defined as within a quarter mile of a bus-rapid‑transit stop. Cities would be required to allow minimum transit‑oriented development densities in those station areas and could grant additional density where all units in a building are permanently affordable or workforce housing. The bill would require at least 10% of units to be affordable at 60% of area median income (AMI) or 20% at 80% AMI for rental buildings in station areas, and it would create a 20‑year multifamily property‑tax exemption (MFTE) for qualifying projects. Commerce would administer a grant program to support station‑area planning, and cities must apply the requirements at either their next comprehensive‑plan update or their five‑year implementation progress report, whichever comes first, staff said.

Sponsor Representative Julia Reed framed the bill as a response to the state’s housing shortage and to a desire to put development near existing transit infrastructure. “Embedded in all of that kind of complex text are the dreams of hundreds of thousands of Washingtonians like me,” Reed said, arguing the measure would unlock housing capacity and promote mixed‑income communities near major transit assets.

Supporters included housing advocates and local governments. Michelle Thomas of the Washington Low Income Housing Alliance said pairing upzones with affordability requirements “will help our cities achieve the dense, vibrant, healthy and diverse urban neighborhoods” envisioned for transit corridors. FutureWise and Transportation Choices Coalition emphasized the bill’s alignment with existing five‑year planning obligations and sought to coordinate state support with local planning timelines.

Several cities and local officials testified with clarifications or concerns. Michael Tranzo of the City of Fife requested confirmation that industrial or manufacturing lands adjacent to stations would be excluded from station‑area upzoning by local design, and Edmonds officials warned that extending MFTE from 12 to 20 years could reduce available tax‑increment financing (TIF) for public infrastructure. Mercer Island’s mayor said the city supports TOD but opposes provisions that remove local control over parking regulations, citing essential workforce parking needs.

Staff described a preliminary fiscal note on the substitute: Commerce’s operating costs include salaries and benefits for approximately 2.8 FTEs in 2025–27 and 1.8 FTEs thereafter for program guidance, rulemaking and professional services, while Commerce’s illustrative grant program amounts for cities were presented as indeterminate and for illustration included roughly $464,000 in 2025–27 and $611,000 in 2027–29. The note also showed potential local costs for comprehensive‑plan updates and new zoning ordinances across the 36 fully planning cities with major transit stations.

The committee heard sustained public comment from city officials, housing and transit advocates, developers and students and closed the hearing after testimony was completed.