Incentivizing the substantial reduction or elimination of impact fees.

SB 5748 allows cities and counties in Washington to replace impact fees (charges for new housing infrastructure like roads or schools) with a local sales tax, provided they first reduce those fees by at least 50%. The tax, capped at 1% of sales, must fund the same infrastructure projects the fees previously covered, and requires voter approval via a simple majority vote. Local governments must annually review the tax rate to align with infrastructure costs, and the tax cannot be used to offset fees already collected through other means. This bill directly affects municipalities that currently impose impact fees and developers building new housing within those jurisdictions.