Economic Development

The Economic Development Department is committed to creating meaningful economic opportunities for individuals and businesses of all sizes.

Why Lacey?

Located along the I-5 corridor between Seattle and Portland and just east of Washington’s capital city, Olympia, Lacey is a dynamic and rapidly growing community. With a 30-minute drive-time market reach of over 425,000 diverse and welcoming people, Lacey is positioned for opportunity and growth.

Experiencing steady growth business activity, the city features a mix of educational institutions, public administration offices, retail centers, small businesses, light industry, healthcare uses, and abundant natural amenities including lakes, trails, and parks.  

A Community That Works

Lacey’s greatest strength is its people; educated, entrepreneurial, highly skilled, and drawn to the area by its unbeatable value: a high quality of life combined with a surprisingly low cost of living. Lacey is home to the most diverse population in Thurston County, which continues to expand as our population grows.  

A Business-Friendly Environment

Lacey sets itself apart with a pro-business mindset. City staff are known for their customer-first approach; working collaboratively to ensure a development process that is clear, predictable, fast, and efficient. With over 17,000,000 square feet of commercial real estate and a strong presence of home operated businesses, the city encourages the development of a diverse, inclusive, and well-connected business community. We recognize that entrepreneurship and local business growth are essential to our economic foundation.  

Strong Partnerships, Real Results

We work hand-in-hand with regional partners to support entrepreneurs and growing industries. Lacey collaborates with the Thurston Economic Development Council and South Puget Sound Community College to establish the Center for Business & Innovation on the College’s Lacey campus; a hub designed to fuel business success and support key sectors in our region.  

Lacey is also home to the Lacey Maker Space, a non-profit providing community access to high tech fabrication tools and training.  

Welcome to Lacey

Where Your Business Can Thrive

The City of Lacey wants entrepreneurs, business owners, and the businesses they own to be successful.  Whether you’re just thinking about starting a new business, have the “fire in the belly” to start your business, are already in businesses, are facing challenges in your businesses, or are ready to take your business to the next level, the City and its many economic development partners want to help. 

Why Do Business in Lacey?

Lacey offers a business-friendly environment with strategic advantages that help you save money, streamline operations, and grow with confidence. Key benefits include:

• No corporate or personal income tax at the state or local level.
• No inventory tax keep more of your capital working for you.
• No tax on interest, dividends, or capital gains.
• No City of Lacey nor Thurston County labor regulations (minimum wage, worker scheduling, etc.) beyond those required by State of Washington 
• Federal Foreign Trade Zone located within the City of Lacey 
• State and City of Lacey Business and Occupation (B & O) Tax credits available for many types of industries 
• B & O filing at the City of Lacey website 
• Small Business Startup B&O Tax Exemption to new small business within Lacey city limits 
• Streamlined Permitting Process 
• Lacey’s Federal HUB Zone, map Opportunities 
• Located in Lacey, APEX Accelerator, a state resource for government contracting opportunities 

Interested in starting your business in Lacey? We have step by step guide to launching your business successfully.   

Research and Plan 

Before buying property or signing a lease, take time to research and plan. Make sure there’s a market for your business and that you have funding to move forward. 

Thurston CB&I: (360) 754-6320 

The Center for Business & Innovation 

Choose a Location  

Once you have funding, look for a location that fits your needs. Make sure it supports your operations and follows local zoning and code rules. 

Lacey Zoning Map 

Lacey Zoning Code: Title 16  

Contact Staff

Talk to City staff to confirm your business is a good fit for the location. They’ll let you know if should schedule a free presubmission conference before moving ahead. 

Lacey Planner: planning@cityoflacey.org, (360) 491-5642 

Apply for Land Use Permits 

If staff finds that your proposal needs land use permits, they will explain the permitting process and any requirements in a presubmission conference. The meeting will cover zoning codes, fees, and how to move forward with your project. Come prepared to discuss your business and location. 

Land use review can take up to four months after a complete application is submitted, excluding any time needed for you to prepare material. After your land use permits are approved, you can move on to applying for your construction permits.  

Lacey Planner: planning@cityoflacey.org, (360) 491-5642 

Lacey Presubmission Conferences 

Lacey Permitting Portal 

Building and Land Use Applications 

Apply for Construction Permits 

Submit any required construction permits. A permit is required for any project to construct, enlarge, repair, alter, move, demolish, or change the occupancy of any building within the City. 

Complete applications will be reviewed for compliance with the appropriate code(s). Review may take 3-4 weeks until you receive the first Plan Review Letter. 

Lacey Building: build@cityoflacey.org, (360) 491-5642 

Lacey Permitting Portal 

Building and Land Use Application

Get Permits 

Once approved, you’ll receive all your permits and can start construction. After you finish construction, schedule an inspection. Staff will check that all the work matches your approved plans and meets code, and will issue a certificate of occupancy. 

Lacey Building: build@cityoflacey.org, (360) 491-5642 

Lacey Permitting Portal 

Get a Business License 

Before opening, register your business with the Washing State Department of Revenue and get a state license. Add the City of Lacey as an endorsement to receive your city business license. 

Washington State Department of Revenue  

Lacey District Subarea Plan

In August 2018, the City of Lacey adopted the Depot District Subarea Plan to shape the future of a key area near the historic train depot. The plan outlines a clear, achievable vision for revitalization while staying aligned with the city’s broader comprehensive plan. 

Highlights of the plan include: 

• Pedestrian-focused improvements along Carpenter Road and Pacific Avenue, enhancing walkability and linking Saint Martin’s University to the future museum site. 

• Development of the Lacey Museum and Cultural Center on a city-owned triangular lot near Lacey Blvd and Pacific Ave, serving as a cultural anchor and catalyst for nearby redevelopment. 

• Mixed-use opportunities around the museum and adjacent properties to energize the eastern end of the couplet island and support infill growth. 

• Community gathering spaces such as an indoor/outdoor farmers market, event venues, trail rentals, and a food truck park. 

• Vibrant commercial zones offering diverse dining and retail options to attract residents and visitors. 

• A strong district identity through cohesive design, public amenities, and improved pedestrian corridors. 

• Support for microbusinesses, especially food vendors and entrepreneurs, to foster local economic growth. 

Depot District Projects

To bring the Depot District Subarea Plan to life, City of Lacey staff launched a series of strategic projects aimed at realizing the district’s long-term vision. These initiatives were carefully designed to reflect the community’s goals for revitalization, connectivity, and economic opportunity. 

A key focus of the City’s investment was supporting small business development and fostering entrepreneurship. By creating spaces that encourage local commerce—such as food truck depot, flexible retail areas, and community markets—the City is helping cultivate a vibrant business ecosystem. These efforts not only stimulate economic growth but also empower local entrepreneurs to thrive within a dynamic, walkable district. 

Through targeted infrastructure upgrades, public space enhancements, and cultural asset development, the City is laying the foundation for a thriving Depot District that blends civic pride with economic vitality. 

Food Truck Pilot Program in the news: 

• Lacey’s first food truck court is set to open in late April 

• Lacey’s New Food Truck Court Combines Good Eats, Local History and Outdoor  

Friday Night Market at the Depot Project: 

• Lacey Night Market  

• SWAE Night Market (current contractor) 

• Night Market Video from KIRO 7 

• Lacey Food Truck Depot: Building Community One Tasty Plate at a Time 

Lacey MakerSpace (Depot District adjacent)

With partnership from Thurston Economic Development Council and Saint Martin’s University, the City of Lacey launched the Lacey Makerspace in 2019 at Zaverl Hall.  

Purpose of the Strategy

Community and Economic Development staff is currently working with ECOnorthwest to develop a Five-Year Economic Development Strategic Plan to guide economic development work in the City of Lacey. Currently in draft form, the strategy is designed to be both aspirational and action-oriented, outlining a long-term vision while giving City staff, elected leaders, and organizational partners a framework to prioritize their work, coordinate effectively, and measure progress.  The finalized draft plan is scheduled to be presented to City Council for review in December 2025.

Economic development is inherently collaborative—duplicating efforts or working in isolation can dilute impact and limit outcomes. This strategy aligns the work of multiple partners and targets Lacey’s resources toward the most impactful projects and programs. By combining data-informed analyses, deep community engagement, and a shared vision for the future, the economic development strategy positions Lacey to strengthen its role as a regional leader and a place where people choose to live, work, and invest.  

The strategic plan and its actions are aligned with the City’s long-term vision and priorities and it is informed by multiple discussions with key stakeholders, partner organizations, and an Advisory Group established to discuss early research then refine recommendations. It establishes a common understanding between the City staff and community members, and it prioritizes the City’s next steps to build a thriving economy in a changing world. 

Welcome to Midtown, Lacey’s central area to live, learn, earn, and create. For more than 50 years, Midtown has served workers, shoppers, students, and visitors. Recent public and private investments have expanded dining, shopping, working, living, and recreation options.

See What’s Happening in Midtown

• Enjoy park events and holiday celebrations.
• Watch the seasonal tree lighting, Lacey Holiday Lights.
• Explore projects currently underway.
• Walk, picnic, or attend free summer events at Huntamer Park.
• Explore transit options at the Lacey Transit Center.
• Study at Saint Martin’s University or South Puget Sound Community College.
• Create and collaborate at the Lacey MakerSpace.

Resources

• Midtown branding elements
• Woodland District Strategic Plan
• Woodland District Zoning Code Chapter 16.24 LMC

Temporary Expanded Alcohol Service

In 2025, the State Legislature passed HB 1515, allowing cities, counties, and ports to authorize temporary “libation zones.” These areas let liquor-licensed businesses serve alcohol in expanded outdoor areas during and after the 2026 FIFA World Cup.

The City of Lacey has been approved by the Washington State Liquor and Cannabis Board (LCB) to offer expanded outdoor service under HB 1515.

Responsibilities & Requirements

Eligible Licensees

• Spirit, beer, and wine restaurants
• Taverns
• Domestic wineries
• Domestic breweries and microbreweries
• Distilleries
• Snack bars

General Requirements

• Licensees must be located within City of Lacey boundaries.
• Licensees must have a building that provides indoor dining.
• Licensees must ensure an employee with Mandatory Alcohol Server Training is assigned to area where patrons are present.
• Expanded outdoor alcohol service areas must be enclosed by a barrier or boundary. Barriers must be at least 42 inches in height, and may use stanchions, fencing, or planter boxes. Fence free demarcation.
• Openings into and out of the expanded outdoor alcohol service areas cannot exceed 10 feet.

Potential requirements depending on size and scope of the proposed activity

• Limits on hours of operation within the expanded area
• Noise mitigation
• Parking/traffic plan
• Private security measures
• Additional conditions, as applicable

Application Process

1. Temporary Use Permit (TUP)

Licensees must apply for a TUP through City of Lacey Community and Economic Development Department (CED).

Fee: $258

Submittal requirements:

• General Land Use Application
• TUP Application Supplemental        
• Site Plan, including applicable items:
  • Private property boundaries and dimensions
  • Fencing, barriers, and public entrances/exits.
  • Height of fences and distance of demarcations.
  • Signage
  • Expanded alcohol service area and Points of Sale (POS)
  • Permanent on-site structures
  • Tents, stages, or temporary structures
• Operating Plan, including:
  • Litter Management Plan
  • Hours of operation
  • Size of pour and alcohol type
  • Age verification process

2. Expanded Alcohol Service Attestation

Licensees must apply for expanded alcohol service through the LCB Portal. There is no fee for applying or receiving authorization for expanded service.

Submittal requirements:

• Site Map – LCB Site Map Guidelines
• Operating Plan – Operating Plan Template

Resources

Expanded Alcohol Services One Pager

LCB Site Map Guidelines

Operating Plan Template

LCB Expanded Alcohol Services Webpage

Applying for Expanded Alcohol Services User Guide

RCW 66.24.800 – Requirements for expanded outdoor alcohol service

WAC 314-03-200 – Outside or extended alcohol service

WAC 314-03-210 – Expanded outdoor alcohol service authorization