Sumner City staff recommend 30% permit‑fee increase; council directs ordinances and enterprise fund

Sumner City council members directed staff on June 29, 2026, to prepare an ordinance to raise development permit fees by about 30% across the board and to create a development‑services enterprise fund, following a presentation that showed the city is recovering roughly 75% of permit review costs and could move closer to full cost recovery with the proposed increase.

City Administrator Jason Wilson framed the policy question for the council: "Do you want to subsidize applicant permit fee costs?" He told the council the current model does not fully recover costs and that the general fund now subsidizes an average of about 25% of permit review expenses.

Consultant Shiovani of FCS reviewed the legal framework and presented three scenarios (10%, 20%, 30%), noting Washington state RCW allows local governments to seek full cost recovery for direct and reasonable indirect permit costs while excluding general government services. Shiovani said a 30% across‑the‑board increase would move the city closer to full cost recovery from the current ~75% level.

The consultant illustrated impacts with sample projects — a commercial warehouse portfolio, tenant improvements, single‑family new construction, and residential remodels/ADUs — and showed that the percent change in total project fees varies by project type because SDCs and some impact fees were held constant in the analysis.

Council members raised the central tradeoff: commercial and multifamily activity account for most permit revenue, while residential permits (remodels, ADUs) make up a smaller share. "If you didn't go 30%, you're leaving somewhere between 30 and $50,000 a year probably on the board," Jason Wilson said when referencing historical 2024 data; he cautioned future annual gains could be closer to $100,000 depending on activity.

Several council members said they favored moving the fee schedule to 30% across the board as a clean policy; others said they wanted to explore targeted relief for residents. Council Member Kenna urged relief for small residential projects and ADUs, while Deputy Mayor Alers proposed using the budget process to create a grant program to offset fees for priority activities.

On the enterprise fund, staff and the consultant outlined benefits and tradeoffs: an enterprise fund would isolate permit revenues, increase transparency, support reserves and staffing, and help the city track true development costs; it also would make the cost of services more visible to the development community. "Enterprise funds . . . put the department at a full cost recovery [model] and align the fees closely to the cost of service provided," the consultant said.

Outcome and next steps: Council members agreed to have staff prepare two ordinances — one adopting the 30% across‑the‑board fee increase and a second creating a development‑services enterprise fund — with the proposed fee change to take effect January 1, 2027. Staff asked council members to coordinate any proposed amendments with staff in advance so they could be drafted cleanly for the regular meeting.

What remains unsettled is whether council will adopt targeted residential relief or a grant program during the budget process; several council members asked staff to model a grant approach and to return with options for amendments at the forthcoming council meeting.

The study session materials and staff models referenced historical 2024 permit activity and estimated a retrospective $350,000 uplift under a 30% scenario, while cautioning that forward years may yield smaller net revenue increases depending on development activity.