It is the second time that a possible release date for Powell, 63, has been derailed. An early release in the works for May was revoked because of concerns about where Powell would live and his work plans.
The department said Powell, who is housed at the Monroe Correctional Complex, may submit a new plan for review. Once the department approves the plan, a 35-day wait period begins during which authorities notify victims and other law enforcement agencies of the proposal.
It must include a safety plan for victims, a suitable address and treatment and work plans. If Powell is not able to come up with a plan that meets department approval, he will remain in prison until his sentence is completed in March 2014.
Powell, father-in-law of Susan Cox Powell, is serving up to 30 months after being convicted in June 2012 of 14 counts of voyeurism for taking surreptitious photographs of girls in his Puyallup neighborhood.
Susan Cox Powell, 28, disappeared from her home in West Valley City in December 2009. Her husband Josh, Steve Powell's son, killed himself and their two young boys in February 2012.