A. The Planning Director shall issue dwelling units in accordance with the limitations given under SMC 17.500.030 and the specific requirements that follow:

B. Category A dwelling allocations consist of dwelling allocations for projects which involve residential dwelling units needing discretionary permits which include, but are not necessarily limited to: conditional use permits, tentative subdivision maps, rezones, design review and/or annexations.

For large projects, the approving authority may impose a condition regarding phasing of allocations, if necessary to maintain reasonable capacity for other projects.

Once a Category A residential project has obtained final discretionary approval, then needed allocations can be issued on a first come, first served basis by the Planning Director for the remaining allocations available that year in accordance with SMC 17.500.030(B). These dwelling allocations are valid until the discretionary approval expires.

If the Planning Director determines that a project eligible for an allocation will exceed the remaining dwelling allocation in the subject calendar year, he or she can grant a partial allocation. Those projects denied allocations in one calendar year will have first priority for issuance of allocations in the following calendar year in order of the earliest date of denial of the full allocation, provided the requirements of SMC 17.500.030 are met.

C. Unused or lapsed allocations may be carried over to the allocation for subsequent years for up to two years, after which they shall return to the base pool of allocations.

D. Once the enabling building permit or discretionary permit has expired or lapsed, said allocations reserved for that project shall be returned to the total dwelling unit allocation for allocation in accordance with SMC 17.500.030.

E. Removed dwelling units shall be added to the total dwelling unit allocation pool once the Building Official has verified removal.

F. Category B allocations for units which are exempt from the annual allocation limits, but which count towards the ultimate limit on dwelling units, shall be accounted for in the annual report provided to the City Council. If there are excess annual allocations available at the end of each calendar year, Category B allocations shall be charged to such excess allocations. Otherwise, Category B allocations shall be charged to the ultimate build-out limitations.

G. Category C projects which will include the annexation of existing residential dwelling units shall be required to pay any established in-lieu fee, or retrofit with low-flow fixtures to eliminate any net wastewater flows from the annexed residential units, in priority order (1) existing public facilities in the City limits or those owned by nonprofit corporations in the City limits, and (2) other residential occupancies in the City limits.

H. Category D projects which will include any residential dwellings subject to out-of-service-area agreements, which units shall be required to pay any established in-lieu fee, or retrofit with low-flow fixtures to eliminate any net wastewater flows from such units, in priority order: