SEQUIM — As part of an effort to help the Flaura’s Acres homeowners association update its failing septic system, Sequim city staff have asked the city council to consider adding a formal process to create Local Improvement Districts and Utility Local Improvement Districts.
The potential new districts could help neighborhoods finance road or sewer line extensions, and residents would work on an agreement with the city to pay it back rather than use a private loan.
Paul Bucich, Sequim’s public works director, said Sequim’s Municipal Code currently doesn’t have a path to form and regulate local improvement districts. To correct that, staff proposed adding “Chapter 20.40 – Formation of Local Improvement Districts” to city code.
City council members agreed to add the new chapter in a 6-0 vote, with Mayor Brandon Janisse excused, for staff to bring back a resolution for inclusion in the council’s consent agenda on Sept. 8.
Bucich said Local Improvement Districts are not common locally, and city staff learned of the lack of city code from residents in Flaura’s Acres.
The 54 single-family development sits south of East Washington Street and East Hammond Street and is located in unincorporated Clallam County.
If Flaura’s Acres has a Local Improvement District approved, project funds would go through the homeowners association to the city and then to Clallam County.
The homes could be eligible for annexation into Sequim with updates made to the sewer, water and roads.
According to city and county officials, the development’s septic conveyance system needs to be replaced, the drain field is failing with no backup, sewage is leaking into groundwater, and there are no hydrants for fire suppression.
“It’s the worst I’ve ever seen,” Bucich told Sequim city council members earlier this year.
Flaura’s Acres residents have a sewer replacement design with funding through the Clallam Conservation District and a loan through the Department of Energy with sizable forgivable principle.
Bucich previously said the city wouldn’t have gotten involved, but the DOE loan cuts down the cost significantly for residents, along with additional funding sources and reduced fees through the city as the properties would be annexed into Sequim.
He said Sequim would then add more utility customers and accrue the development’s water rights.
Residents also would have lower water rates as they’d be city residents rather than out-of-city customers who pay 50 percent more.
Bucich said with the development in the Urban Growth Area, the project may need to go before the Clallam County Board of Equalization for consideration.
District creation process
To create a Local Improvement District in the city, a public hearing must be held either through the city council, planning commission or a hearing examiner. The city council would make the final voting decision on any proposed district.
Bucich said staff recommended the planning commission to hold any public hearings as the requests will be rare and likely with little scrutiny as the residents will either be following city code or not.
Using a hearing examiner also could be costly, he said.
Deputy Mayor Rachel Anderson shared a concern about the planning commission’s capacity to take on new duties, but Bucich said the commission would not see a request for several months as city staff are still awaiting an interlocal agreement from Clallam County officials about the project, and construction isn’t anticipated to begin until spring 2026.
A public hearing also might be needed if the city adopts a new fee for processing Local Improvement District applications or petitions, but staff reported in Aug. 11 planning documents that it could be included in the city’s annual hearing for rates and fees during the budget approval process each November.
Staff said if costs exceed the deposit, city staff can either require more funds to proceed or include the additional costs in the repayment plan of the Local Improvement District between the residents and the city.
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Matthew Nash is a reporter with the Olympic Peninsula News Group, which is composed of Sound Publishing newspapers Peninsula Daily News, Sequim Gazette and Forks Forum. He can be reached by email at matthew.nash@sequimgazette.com.
