City of Burien
BURIEN PLANNING COMMISSION MEETING
August 24, 2004
7:00 p.m.
City Council Chambers
MINUTES
Planning Commission Members Present: Robert Simpson-Clark, chair; Jim Clingan, Jon Newton, Janet Shull, Michael Sumner, and Barbara Williams
Absent: Rebecca McInteer
Others Present: Scott Greenberg, Community Development director; David Johanson, senior planner; Gerry Lindsay, minutes taker
Chair Simpson-Clark called the meeting to order at 7:05 p.m. Upon the call of the roll all commissioners were present with the exception of Commissioner McInteer.
Agenda Confirmation
It was agreed to delete item VII, Town Square Public Space Report, from the agenda.
Motion to approve the agenda as amended was made by Commissioner Williams. Second was by Commissioner Shull and the motion carried unanimously.
Public Comment – None
Approval of Minutes
A. August 10, 2004
Motion to approve the minutes as submitted was made by Commissioner Williams. Second was by Commissioner Newton and the motion carried unanimously.
Old Business
A. 10-Year Tax Abatement Public Hearing
Chair Simpson-Clark declared the public hearing open.
Community Development Director Scott Greenberg provided the commissioners with copies of a memo from senior planner David Johanson containing answers to questions raised by the commission at the August 10 meeting. He said following receipt of a recommendation from the Planning Commission, the City Council will hold its own public hearing on September 13; the council is tentatively slated to take action on September 20.
Mr. Greenberg offered for consideration a revision to 19.45.030.4.H, the section focused on mixed-use development. He said under the original language, the ability of the director to waive the mixed-use requirement is wide open. The proposed change establishes three criteria by which the director can waive the requirement: 1) provide at least one complete public benefit feature from BMC Table 19.15.025.1; 2) design, market and manage the units as housing for people 55 years of age and older; and 3) design and market at least 20 percent of the proposed dwelling units as affordable housing for low- and/or moderate-income households based on the current King County median income guidelines.
Mr. Greenberg confirmed for Chair Simpson-Clark that only residential is currently allowed in Downtown Commercial.
Commissioner Shull asked if specific blocks or streets allow retail on the ground floor. Mr. Johanson said dwelling units are not permitted on the ground floor of abutting Class A-oriented streets, including 152nd and 4th.
Chair Simpson-Clark asked staff to make sure the proposed provision does not provide a loophole for getting around an existing requirement for mixed use. Commissioner Shull concurred and said if there is a requirement for retail at street level for any part of the downtown, the requirement should be retained. Mr. Greenberg said there is no specific requirement for retail on the ground floor. He suggested that for purposes of clarity, his proposed revision should be changed to read “The director may waive this requirement for the purposes of this chapter provided the project meets at least one of the following criteria.” Chair Simpson-Clark said that would address his concerns.
Greg Anderson, 15451 11th Avenue SW
Mr. Anderson voiced concern regarding the 10-year tax abatement proposal. He said he did not know how much it will cost the citizens of Burien in the long run but guessed it would be around $10 million in lost taxes. He said he also did not see a clear need to enact the program. The City Council has acted in the past to downzone many of the areas. In order to get the density called for in the Comprehensive Plan, the zoning should be increased to R-48 or so. Burien currently has a rather high residential unit vacancy rate, which further argues against developing more residential properties. It would be rather unfair for a chosen few to have their property taxes abated.
Harold Duncanson, 145 SW 155th Street
Mr. Duncanson said he did not want to see the Town Square project delayed; he said he is very optimistic about what that project will mean for Burien. However, as the owner of an apartment building on 155th Street, and the owner of another site that could be redeveloped, the proposed tax abatement program could mean stiffer competition for his housing units. He allowed that depending on where the line is drawn for the target area, one of his properties could be inside the line and thus be eligible to benefit from the program. If the program is implemented, the target zone should be drawn wider than just the Downtown Commercial zone. It remains unknown whether or not the tax incentive will even be necessary in order to yield a quality project. Nothing has been said yet about what mix of units will be included in the project or what the rent rates will be. Staff is saying Town Square will not pencil out without the tax abatements, and that there is no potential downside. The fact is those who have invested in other projects, and who may ultimately have to complete with Town Square, could experience a very real downside.
Jill Godina, 710 SW 146th St.
Ms. Godina commented that she either will or will not benefit from the tax abatement program depending on where the line is drawn. Furthermore, there are a lot of empty housing units in Burien, which would seem to say that additional units are not needed. Encouraging even more units to be built by offering a huge incentive does not seem like a good idea. The tax abatement program will benefit a select few only.
Chair Simpson-Clark closed the public hearing.
B. 10-Year Tax Abatement Discussion and Recommendation
Motion to recommend to the City Council that the Burien Zoning Code be amended to add a new chapter 14.95 establishing a 10-year tax abatement program in the city of Burien, including the revised staff recommendation presented with the language that says for the purpose of this chapter as previously discussed was made by Commissioner Newton. Second was by Commissioner Williams.
Commissioner Sumner indicated his support for the tax abatement program. He said it will be good for the business people and for the city. He indicated concern that the proposed boundary is quite limited and leaves out some who have chosen to invest in Burien; the line should be drawn wider than just the Downtown Commercial zone.
Chair Simpson-Clark said he owns an apartment building two lots outside the Downtown Commercial zone. He said he initially was in favor of stretching the target area boundary beyond just the Downtown Commercial zone to include specifically the South Hill area. Within the current Downtown Commercial boundary there are very few multifamily housing units. The area has an established zoning requirement for development standards that exceeds those of the areas that have the bulk of the city’s multifamily housing. Those development standards result in higher development costs for housing units in the Downtown Commercial when compared against the surrounding multifamily areas. In that light, the abatement program will entice development without resulting in rents that will compete unfairly with existing units. The program will result in a temporary subsidy for certain developments, but the per-unit costs for developments outside the Downtown Commercial zone will still have a slight advantage over the per-unit costs for developments inside the Downtown Commercial zone that will be able to participate in the abatement program. Developments outside the line will benefit from having a far more desirable development close by.
With regard to current vacancy rates, Chair Simpson-Clark noted that the planning focus is on a distant horizon. The units to be added within Town Square and within the Downtown Commercial will not be unnecessary in light of future growth. No developer will even build the units in the first place if they do not perceive a demand for them.
Commissioner Williams said she also believed after the first study session on the issue that there would be an advantage to increasing the size of the target area boundary beyond just the Downtown Commercial. However, after giving the issue more consideration, the proposal represents a good first step. If proved to be successful, in time the boundary could be extended. The program is a simple and clean method for getting top-quality units constructed in the downtown core without having to effect any zoning changes. She added that regardless of where the line is drawn there will be some areas inside it and some outside it. She agreed that those developments that end up just outside the line will still benefit from having an excellent development nearby. She said she would vote in favor of recommending making the residential target area the same as the Downtown Commercial zone.
Commissioner Shull concurred. She suggested that the position of the line should be revisited at least every five years. There certainly are advantages for the city associated with encouraging development activity in the downtown, and there could be advantages to promoting additional development or redevelopment in adjacent areas, particularly to the south. The abatement program will mean that certain property taxes will not be collected, but overall the city will benefit from having a quality mixed-use development with additional housing units. The Town Square development should ultimately prove to be a magnet for additional development and redevelopment that will make the community a more desirable place to live and have businesses.
Regarding what the program will cost the city, Chair Simpson-Clark said his understanding is that the units will not get built at all without some manner of incentive. The kind of development envisioned is simply not likely to come about under economic conditions. If nothing is built, the city will not receive any tax revenues; if something is built and the taxes are abated for 10 years, the city will be in the same position for the first 10 years. The city will lose tax revenues only if incentives are allowed for development that would have occurred anyway. Since the development is not likely to occur absent incentives, the scenario is revenue neutral for the city.
Commissioner Clingan said he is concerned over the fact that there remains a $5 million gap in the project budget after figuring in the proposed abatement. The abatement should used as a safety net instead of as a part of the original plan. Several developments of the type the city is looking for in Town Square have been constructed in Burien, and all without the benefit of having property taxes abated. He said he is not convinced that the tax abatement program is necessary. Even the Downtown Commercial zone is too large an area to serve as the residential target area; it should be scaled back even more to cover just the immediate area of Town Square.
Commissioner Newton agreed with the comments made by Chair Simpson-Clark. There is no residential developed on the Town Square site currently, so the city is not collecting tax revenues. The tax abatement program is an effective tool the city can use to encourage development. The residential target area should be set as large as possible to begin with. In the long term there will be untold benefits flowing from the Town Square development; with an increased downtown area making the city more attractive, other people will want to come to Burien.
Chair Simpson-Clark suggested that the definition of “ad velorum” as used in the document should be coupled with the phrase “commonly referred to as real estate tax.” Mr. Greenberg said he would not oppose adding in the phrase. He noted that RCW 84.14 is the overall statute that authorizes the program. The city has no say at all in what specific taxes get exempted; that is in the purview of the King County Assessor’s Office. Anyone wanting to develop within the residential target area would have to do their own research to understand exactly which taxes would be abated; the city will not do those calculations for them. He cautioned against making the language of the ordinance too specific because if state law were to change the city could end up with something that is inconsistent with state law.
Mr. Greenberg said he would check with the Finance Department to see if it knows what taxes would be exempted and what taxes would not be exempted. The commissioners agreed that information would be helpful.
Commissioner Williams noted that in the definitions section multifamily housing is defined as four or more dwelling units designed for permanent residential occupancy. RCW 84.14.030.3 requires 50 percent of the units to be permanent residential. Taken together, the two could be interpreted to mean that something could be designed for but not necessarily used for a specific purpose. The proposed language for the city ordinance uses the positive inflection, whereas the RCW language uses the negative, and it may be helpful for the city language to mirror the state language.
Commissioner Newton suggested that Section 19.45.030.6 should have a paragraph (C) added to address the appellate process. Mr. Greenberg agreed.
Commissioner Williams asked if Section 19.45.030.8.C should be interpreted to mean that the director will have to take the entire value of the property and break down the improvements into two parts, the part affected by the abatement and the part not affected by the abatement. She allowed that that could be complicated in cases of redevelopment in that the original portion would not fall under the abatement; someone will need to track the value of what has been added, and that tracking could be both expensive and difficult. Mr. Greenberg agreed that there could be complications involved for buildings with many different uses, only some of which are tax exempted. Most projects will be new and will not therefore be complicated. The program likely will not be used much at all in Burien for rehabilitation because of the restriction in state law that buildings must be vacant for 12 months.
Chair Simpson-Clark suggested that Section 19.45.030.8 involves a simple reconciliation of the original plan with the completed structure. As such it is quite straightforward. Mr. Greenberg agreed and said the section essentially refers to a final punch list to verify that the project was built in accordance with the requirements of the chapter.
Commissioner Newton pointed out that Section 19.45.030.9 allows only 10 days in which to file the final certificate. Unless the 10 days are specifically shown as business days, an intervening weekend or holiday could cut the period down to only three or four work days. Mr. Greenberg said he would be willing to change the reference to 14 days provided state law does not specifically allow only 10 days.
Commissioner Newton proposed revising “…if the owner intends to convert…” in Section 19.45.030.11 to read “…if the owner converts….” Mr. Greenberg pointed out that state law uses the word “intends” but said the language could be changed in order to be more flexible for the owner. The change in use must occur, then the 60-day period begins, and the suggested revision is consistent with that.
Commissioner Clingan asked if the target area can be expanded once it has been established. Mr. Greenberg allowed that the boundary can be expanded, provided the boundary remains within a designated urban center, which under state law does not necessarily correspond with the Burien urban center boundary. To change the boundary would involve a Zoning Code amendment with a full public process and a final decision by the council.
Mr. Greenberg commented that while Town Square is serving as the catalyst for bringing the tax abatement program to the table, the Comprehensive Plan and the council work program for 2005 both call for looking at the program as a development tool. The tool will be helpful regarding the Town Square project but is something the council directed staff to look at for the downtown area generally.
Commissioner Shull suggested that the first definition in Section 19.45.010 should be the one defining ad velorum property taxation. She also pointed out that in Section 19.45.020.1.C the word “providing” should be “provision.”
The question having been called, the vote on the motion carried 5-1 with Commissioner Clingan casting the only no vote.
Mr. Greenberg reiterated that the council public hearing on the subject will be held on September 13.
Director’s Report
Mr. Greenberg reported that Morgan Wilson has been hired to take the place of planner Pat Smith, who is moving back to his native Minnesota. Ms. Wilson comes from southern Oregon where she has been engaged in land use reviews and comprehensive planning.
Adjournment
Motion to adjourn was made by Commissioner Newton. Second was by Commissioner Williams and the motion carried unanimously.
Chair Simpson-Clark adjourned the meeting at 8:15 p.m.
Approved:
/s/ Robert Simpson-Clark, chair
Planning Commission
/s/ Scott Greenberg, director
Community Development Department