The proposed legislation aims to facilitate the establishment of small businesses within residential zones in Washington State, recognizing their vital role in enhancing community connections and supporting local economies. The bill emphasizes that small businesses, which constitute 99.5% of all businesses in the state, contribute significantly to employment and the quality of life in neighborhoods. It encourages cities and towns to permit certain neighborhood businesses, such as cafes, early learning centers, and professional services, to operate in residential areas while ensuring that these businesses maintain compatibility with the surrounding environment.

To implement this, the bill introduces new sections to chapters 35.21 and 35A.21 of the Revised Code of Washington (RCW), mandating that neighborhood businesses be allowed in any zone permitting residential uses, provided they meet specific criteria, such as size limitations and the exclusion of drive-through facilities. Additionally, local governments are empowered to establish regulations regarding operational hours, noise mitigation, signage, delivery logistics, and the sale of alcohol, ensuring that these businesses do not disrupt the residential character of their neighborhoods. The definition of "neighborhood business" is also clarified, encompassing various types of establishments that serve the community while adhering to the outlined restrictions.