Title
Home Based Businesses Code Amendments Public Hearing
Recommended Action
Move to approve the proposed Home Based Businesses Amendments
Report
Issue:
Whether to conduct a public hearing and recommend approval of the proposed Home Based Businesses Amendments.
Staff Contact:
David Ginther, Senior Planner, Community Development, 360.753.8335
Presenter(s):
David Ginther, Senior Planner
Background and Analysis:
Home Occupation. A commercial use within a residential dwelling unit which is clearly incidental and accessory to the residential use of the property and complies with applicable provisions of this Title. [OMC 18.02.180.H.]
The City of Olympia has regulated home based businesses (home occupations) since 1962 (likely earlier) with the primary intent of allowing home offices, childcare, in home hair salons and other businesses so long as there is almost no outward appearance of the business. These regulations have been occasionally updated, but retain the fundamental purpose as was written in the 1960’s. Today’s home occupation regulations continue to focus on avoiding increased impacts to the surrounding residences by limiting the size and scale of the business within the residence. The primary way this has been accomplished has been through requiring that only those who live in the residence can work out of the residence. Other limitations such as those related to noise, signage etc. have been in place for decades. While the primary function of these regulations remains consistent, changes to the workplace due to technology has changed and warrants a review of these requirements.
During the process for updating the City of Olympia Comprehensive Plan in 2025, comments were received that voiced concern about the use of homes for business purposes in the South Capitol Neighborhood that appeared to go beyond what would generally be allowed for a home based business. Given the recent changes to work from home options, Community Development Department staff, including planning, code enforcement, and the former director, researched the issues surrounding home based business requirements and briefed the City Council in the fall of 2025. The Olympia City Council directed staff to update the regulations for home based businesses in 2026.
The intent of the amendments is to update and modernize the code language resulting in improve clarity and readability so that the reader is more easily able to identify what is applicable and when process is required. These amendments retain the long-standing purpose of minimizing impacts from the business to adjacent residences while updating permit processing requirements and providing clarity on what is/is not a home based business.
Amendments Summary:
The proposed amendments address a variety of subjects relating to home based businesses located in all neighborhoods within the City, including:
• Added a definition for “remote work” for those that work from home and are not operating a business
• Added an exception to allow mobile mechanics and detailers provided no work is done at the home occupation location and only one work vehicle is allowed at the home
• Further clarified that the location of the home based business must be the principal residence of the applicant
• Removed references to permits (see further explanation below)
• Allowed on-site sales provided no product is visible from outside
• Allow for structural renovations only if they are consistent with the residential character and exterior appearance of the lot and dwelling
• Removed redundant sections that are addressed elsewhere in the Olympia Municipal Code, the building or fire codes, and State law (short-term rentals, adult day care homes, and family child care homes)
• Minor updates such as changes to the department name, grammar, and changing the name of "home occupations" to "home based businesses".
See Attachment 3 for a list of changes that were made to the second draft of the proposed amendments after the July 20, 2026, Planning Commission briefing.
Comments from the South Capitol Neighborhood:
During 2025, community members provided comments, which included concerns about the use of homes for commercial purposes that appeared to go beyond what would be allowed as a home based business. To address the concerns several changes are proposed regarding residency. These apply city-wide and do not target a specific geographic area.
• A new definition for “principal residence” has been added
• The existing code section that requires the location of the home based business to be the residence of the owner has been updated to be more clearly articulated
• The Home Based Business Addendum (an affidavit that must be signed when applying for a business license) is being modified to more fully reflect the residency requirement
Some of the other issues mentioned in the comments already have remedies available in other portions of the City regulations:
• Large gatherings causing a disturbance would be dealt with by the Police
• Parking Services would deal with parking issues because the area is within a residential parking permit zone
• Homes converted to a commercial business or office space would be investigated by code enforcement
• Homes and yards left in poor condition would be investigated by code enforcement
Permits:
The existing regulations refer to a permit for a home based business but permits have not been collected since approximately 2008 when budget and staffing cuts occurred. References to permits are proposed for removal. Currently, for a person to operate a home based business, they must obtain a business license and sign a Home Based Business Addendum/Affidavit. The affidavit requires the business owner to attest to the fact that they meet all the regulations for home based businesses in the Olympia Municipal Code. A reference to a permit application is also proposed to be removed from the section of the Olympia Municipal Code that deals with authority of the Hearing Examiner to better reflect current processes.
Special Exceptions for 300-400 block of West Bay Drive:
Several special exceptions are in the existing regulations that only apply to home based businesses located in the 300-400 block of West Bay Drive. These exceptions deal with signage, group counseling, non-resident employees, how much of the home is used for the business, and selling items on-site. These were added to the Olympia Municipal Code around 2000-2003. There is one home based business located in this two block stretch of single family homes. It was established as a media services business in 1988 with a home occupation permit. The business is still currently operating at this location and will be allowed to remain.
Staff has spoken with the owner of this business and explained why the code is being amended and what is proposed to be changed. Staff also explained that removal of these exceptions from the regulations will not affect the ability of the existing business to continue with their operations as they have been. Chapter 18.37 Nonconforming and Conforming Buildings and Uses of the Olympia Municipal Code provides for lawfully established uses to continue. This business will be able to continue utilizing the exceptions they are currently using.
Comprehensive Plan Policies:
One of the policies in the recently updated Olympia Comprehensive Plan was to simplify and streamline the zoning code. Removal of redundant requirements and special exceptions that are already provided for elsewhere in the Olympia Municipal Code is consistent with that policy. The amendments dealing with short-term rentals, adult day care homes, family child care homes, and the exceptions for the 300-400 block of West Bay Drive are consistent with this Comprehensive Plan policy.
Policy PL1.17 in the Land Use Chapter of the Olympia Comprehensive Plan:
Evaluate development regulations and zoning to ensure they are clear, as simple as possible, and not redundant, and update if necessary.
Climate Analysis:
The proposed amendments are consistent with climate goals and efforts to reduce vehicle miles traveled. Providing for home based businesses allows small business owners to work from home. The regulations restrict the number of deliveries to the location of the home based business. When compared to a business in a commercial location, vehicle trips from customers and suppliers are generally lower for the home based business.
Equity Analysis:
The regulations apply citywide, or at least equally across the residential zoning district designations regardless of where they are in the city, with one exception. The 300-400 block of West Bay Drive is singled out as an area where home based businesses have greater allowances than home based businesses located in the rest of the City of Olympia. The proposed amendments remove these special exceptions. While these amendments were spurred by community concerns in the South Capital neighborhood, it is important to consider their purpose and impact citywide.
Neighborhood/Community Interests (if known):
Written comments received so far are attached to the staff report (see Attachment 4). The main known community interest relates to the use of residential homes by lobbyists in the South Capitol Neighborhood. Staff has attempted to address these concerns by adding language around what is/is not remote work and to add clarity to the requirement that the home based business location must be the principal residence of the business owner. As these amendments will affect all residential neighborhoods throughout the City, careful consideration of all neighborhoods is warranted to ensure home based businesses avoid impacts to the surrounding residences. Amendments must also stay within the confines of what the City of Olympia is legally allowed to do. This issue is further discussed in the Background and Analysis section of the staff report. Comments received also contained suggestions for changes to the definition of “remote work” (see Attachment 4).
Options:
1. Conduct the public hearing, deliberate, and develop a recommendation on the proposed amendments.
2. Conduct the public hearing and postpone deliberations until the following meeting.
3. Do not conduct the public hearing and reschedule it for a future meeting.
Financial Impact:
Funding for this proposed work is being provided by the department’s base budget.
Attachments:
Second Draft Home Based Business Amendments
Second Draft Home Based Business Amendments (Annotated)
List of Changes to Second Draft
Public Comments
2025 Director’s Interpretation
Engage Olympia Webpage