Allowing small business establishments in residential zones.

Sponsorship changed from 'House Local Government' to 'House Appropriations', and the bill title changed to 'Second Substitute Bill'.

Neighborhood stores in residential zones are now explicitly prohibited from selling nicotine products (tobacco or manufactured).

Neighborhood stores and cafes cannot display signage or advertising for products illegal to sell to individuals under 21 years of age.

Cities are now permitted to regulate signage and advertising for neighborhood stores and cafes, provided regulations are consistent with the bill and no more restrictive than those for other residential uses.

Section 1 was renumbered; the original Section 4 regarding additional city regulations was removed and split into new Sections 4 and 5 to clarify the scope of allowed regulations.

Section 2 was renumbered; the original Section 4 regarding additional city regulations was removed and split into new Sections 4 and 5 to clarify the scope of allowed regulations.

A new Section 3 was added to reenact and amend RCW 43.21C.450, establishing categorical exemptions from environmental review for specific actions, including those necessary to comply with Sections 1 and 2 of this act.

Added specific deadlines for cities to implement the new regulations: Growth Management Act cities must comply by their 2027 comprehensive plan update, while other cities must comply within two years of the bill's effective date.

Added a new definition for 'neighborhood store' to include convenience grocery stores and mini-markets that sell food, beverages, and household items, provided they are at least 500 square feet.

Modified the definition of 'neighborhood café' by removing the requirement that it must serve a limited menu of food items, broadening the category of eligible businesses.

Added a requirement that neighborhood cafés must offer food if they choose to offer alcoholic drinks.