HomeMy WebLinkAboutCOW 2006-07-24 Item 4B - Agreement - Tukwila Station Development Proposal with Fountain Park LLC COUNCIL AGENDA SYNOPSIS
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ITEM INFORMATION
I CAS NUMIBIER: 06-084 IORICIN :\I. AGENDA D1TR: 7/24/06
1GIi \D.1 ITEM TED.R Public /private partnership to exchange real property with Fountain Park LLC to
facilitate the future extension of Strander Boulevard and mixed -use transit oriented
development (TOD) near the Sounder /Amtrak Station
C.ITRGOIt\ Disaurion I Motion Resolution Ordisan:z Bid Award Publi: Hearing Other
.11tg Dale 7 /24 /0q;ur Date Mt3 Dale 3fts Date Aftg Date AN Date AN Date
SPONSOR Council Major Arlin Svcs M DCD Finance Fire Legal P&R Police PRY
SPONSOR'S Fountain Park LLC plans to construct a mixed -use development (Tukwila Station)
SUMMARY consisting of approximately 5,000 square feet of retail space and 300 residential units. By
way of background, on April 4, 2005 the City Council authorized executing a development
agreement and land exchange with Pacific Commercial Properties (PCP) that mirrors the
current proposal.
RE\'R Bl COW \Itg CA &P Cmte El F &S Cmte Transportation Cmte
utilities Cmte Arts Comm. Parks Comm. Planning Comm.
DATE. 7/17/06
RECOMMENDATIONS:
StuNSOR /AUVIN. Discuss and forward to the next regular City Council meeting
Co\IUI7"rEE Forward to COW for review and discussion
COST IMPACT FUND SOURCE
ESI'I ?NDI'I'GRI? RI QUIRIil) AMOUNT BUDGETED APPROPRIATION REQUIRED 1
50 50
50 I
Fund Source:
Continents:
MTG. DATE 1 RECORD OF COUNCIL ACTION
1
1
MTG. DATE I ATTACHMENTS
7/24/06 1 Memorandum to the Finance Safety Committee dated July 13, 2006
Proposed Development Agreement with Fountain Park LLC
Minutes from the July 17, 2006 Finance Safety Committee meeting 1
Memorandum to the Committee of the Whole dated February 22, 2005 1
1 Minutes from the April 4, 2005 City Council meeting
1
1
r
To Finance Safety Committee
From. Kevin A. Fuhrer, Finance Director ({h-
Date July 13, 2006
Subject: Tukwila Station Development Agreement Proposal
The City once again has an opportunity to enter into a public /private
partnership with a private developer This partnership would involve an
exchange of real property with Fountain Park LLC in order to facilitate.
1 the future extension of Strander Boulevard, and
2. a mixed -use owner occupied residential project to be constructed
within the Transit Oriented Development (TOD) area of the
Tukwila Urban Center (TUC).
By way of background, in early 2005 the City entered development
agreement negotiations with Pacific Commercial Properties (PCP) to
construct the same project as referenced in item (2) above. Following the
customary legislative review process, the City Council approved the
document on April 4, 2005 Near the close of the year City staff ascertained
that PCP was having lending difficulties and in fact no longer had the option
to purchase land from the property owner, Stuart McCleod. Consequently
the term of the agreement was allowed to lapse.
Following this cover memo are several items to provide a frame of
reference.
Proposed development agreement with Fountain Park LLC
o Memo from Steve Lancaster and myself to the Committee of the
Whole dated February 22, 2005 regarding the initial Tukwila Station
Project and proposed agreement with PCP
o Minutes from the April 4, 2005 City Council meeting.
The current development agreement proposal remains substantially the same
as the one approved by Council in April 2005, with the following
exceptions.
o addition of Section 2.4 1 requiring Fountain Park LLC to submit a bid
at 110 less than fair market value for the remaining property (57' of
vacated railroad) should the City hold it out for sale
o addition of Section 2.13 which grants to Fountain Park LLC a renewal
of the conditional use permit approved by the City on April 29, 2005
o date and corporate name have been updated throughout the agreement.
As the Hotel/Motel Tax Fund 101 is the City's intemal property owner of
record, this item was discussed with the Lodging Tax Advisory Committee
(LTAC) at their May 9, 2006 meeting. The LTAC continues to support the
development agreement proposal.
In closing, I look forward to the discussion of this item at the July 17, 2006
committee meeting.
DEVELOPMENT AGREEMENT BETWEEN FOUNTAIN PARK LLC AND THE CITY
OF TUKWILA
FOR THE DEVELOPMENT
OF A MULTI -FAi 1ILY CON OMINIUM PROJECT
I. PREAMBLE
This DEVELOPMENT AGREEMENT "Agreement between Fountain Park LLC, a
wholly owned entity of Prium Companies LLC "Fountain Park and the CITY OF TUKW LA,
a municipal corporation of the State of Washington "Tukwila" or "City"), is entered into
pursuant to the authority of RCW 36.70B.170 through .210, under which a local government
may enter into a development agreement with any entity having ownership or control of real
property within its jurisdiction.
II. RECITALS
A. Fountain Park has a contract for purchase and sale dated March 8, 2006, to purchase
property located in the City of Tukwila, King County, Washington, more particularly described
as King County Tax Parcel Nos. 2423049137 and 0005800013, equaling approximately 6.2
acres.
B Fountain Park intends to close on the above- referenced sale on or before October 7,
2006.
C. Fountain Park desires to develop this property for a mixed -use owner occupied
residential project to be constructed within the Transit Oriented Development "TOD area of
the Tukwila Urban Center "TUC This development, commonly known as "Tukwila Station,"
will be an approximately 300 unit mixed -use residential development with approximately 5,000
square feet of retail space. This development is more fully explained in the design schematics
submitted to the City on March 16, 2005 by a prior developer.
D Land uses within the TUC were adopted prior to the presence of the Commuter
Rail/Amtrak Station. Tukwila is currently in the final stages of developing a new plan for the
TUC that recognizes that the Commuter Rail/Amtrak Station is a transportation amenity
E. The City issued a threshold determination dated April 22, 2005, and approved a
conditional use and design review on April 29, 2005 These approvals shall be honored by the
City and run with the ownership of the property The City has further determined that this
development meets the City's concurrency standards and that impact fees shall be due at the time
of permit issuance.
F The City of Renton has identified a preferred alternative for the future extension of
Strander Boulevard eastward from West Valley Highway "Strander Project'). This alternative
would require the relocation of the Union Pacific Railroad "UPRR right -of -way from its
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G\City Attomey\PETERPIanningiTukwila Station DA 7 -13 -doe
current location to a location adjacent and west of the existing Burlington Northern right -of -way
This portion of the property would be owned by Fountain Park.
G. To facilitate the relocation of the IJPRR, Tukwila would be required to acquire
through condemnation, or other negotiated means, the property required for the Strander Project.
This would be costly to the City if the property were fully developed at the time of
condemnation.
H. Tukwila owns approximately 1.63 acres of land immediately north of the Tukwila
Station site, of which approximately 36,000 square feet are subject to this Agreement.
I. Thus, the Parties wish to exchange certain parcels of property for their mutual benefit.
J To provide certainty and efficiency to Fountain Park and the City with respect to the
development of this property, to encourage mixed -use owner occupied residential development
of this property, and to ensure acquisition of property needed for the Strander Project for the
City, the Parties wish to enter into this mutually beneficial Development Agreement.
BASED ON THE FOREGOING, and because successful development of this site will be
of long -term benefit to both Tukwila and Fountain Park, Tukwila and Fountain Park hereby
agree as follows:
III. AGREEMENT
1.0 Effective Date and Term.
1.1 This Agreement shall become effective upon approval by the Tukwila City
Council, execution by both Parties, and proof in a form acceptable to the City of Fountain Park's
ownership of the subject property not later than October 7, 2006; provided, however, that the
Mayor in his sole discretion may extend this deadline to November 7, 2006, without further
authorization of the City Council.
1.2 The term of this Agreement shall commence upon the Effective Date and
continue for a period of ten (10) years.
2.0 Terms.
2.1 Fountain Park shall convey by statutory warranty deed to Tukwila the portion of
its property (estimated to be an approximately 100 -foot strip) needed for relocation of the UPRR
right -of -way, more fully described in Exhibit "B" "Fountain Park Portion attached hereto.
2.2 In exchange, Tukwila shall convey by statutory warranty deed to Fountain Park a
portion of its property adjacent to the proposed Tukwila Station site, more fully described in
Exhibit "A" "Tukwila Portion attached hereto.
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O:': City AttomeylPETER\PlanninglTukc,vila Station DA 7- 13.doe
2.3 Fountain Park will retain a temporary easement for parking purposes on the
Fountain Park Portion, in a form substantially similar to the attached Exhibit "C" ("Fountain
Park Easement"). In utilizing the Fountain Park Easement, Fountain Park agrees to the following
Indemnity and Insurance provisions.
2.3.1 Indemnity Fountain Park shall indemnify, defend, and hold harmless
Tukwila, its agents, and employees from and against any and all liability arising from injury or
death to persons or damage to property resulting in whole or in part from negligent acts or
omissions of Fountain Park, its agents, servants, officers, or employees, irrespective of whether
in connection with such act or omission it is alleged or claimed that an act of Fountain Park, its
agents, or employees caused or contributed thereto. In the event that Tukwila shall elect to
defend itself against any claim or suit arising from such injury, death, or damage, Fountain Park
shall, in addition to indemnifying arid holding Tukwila harmless from any liability, indemnify
Tukwila for any and all expenses incurred by Tukwila in defending such claim or suit, including
reasonable attorneys' fees.
2.3.2. Insurance.
2.3.20). Fountain Park shall procure and maintain in full force throughout the
duration of its use of the Fountain Park Easement comprehensive general liability insurance with
a minimum coverage of S1,000,000.00 per occurrence /aggregate for personal injury and property
damage. Said policy shall name the City of Tukwila as an additional named insured and shall
include a provision prohibiting cancellation or reduction in the amount of said policy except
upon thirty (30) days prior written notice to Tukwila. Cancellation of the required insurance
shall automatically result in termination of Fountain Park's use of the Fountain Park Easement.
2.3.2(ii). Certificates of coverage as required by Paragraph 2.3.20) above
shall be delivered to Tukwila prior to Fountain Park's use of the Fountain Park Easement.
2.4 Upon commencement of the Strander Project and any associated relocation of the
UPRR tracks, the Fountain Park Easement identified in paragraph 2.3 shall terminate and be
extinguished. Upon completion of the relocation of the UPRR tracks and the City's acquisition
of the existing UPRR right -of -way "Union Pacific Site'), more fully described in Exhibit "D"
attached hereto, the City shall convey to Fountain Park for permanent parking purposes the
Union Pacific Site. The property exchange contemplated by this provision will be detailed in a
formal Property Exchange Agreement that will be executed at the time the City acquires the
Union Pacific Site. As part of the Property Exchange Agreement, Fountain Park shall provide
the City with a bond for 150% of the estimated cost of constructing permanent parking on the
Union Pacific Site. This permanent parking shall be in conformance with all applicable City
regulations and shall be completed within two years of the execution of the Property Exchange
Agreement.
2.4.1 Upon public notice by the City of its intent to sell the approximately 57
feet of remaining vacated UPRR right -of -way running adjacent to the Union Pacific Site,
Fountain Park shall submit a bid to the City in conformance with the City's bid requirements for
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G:\City Attome) +PEIERIPIanning \Tukwila Station DA 7- I3.dcc
the purchase of this property Fountain Park's bid shall be no less than the property's Fair
Market Value at the time the City makes the property available for sale.
2.5 The City shall exercise its best efforts to provide 180 days advance written notice
to Fountain Park of the termination and extinguishment of the Fountain Park Easement. The
City shall not be responsible for procuring interim parking for Fountain Park's development
during the associated relocation of the UPRR right -of -way
2.6 The development is subject to the obligation of each Party to convey clear title to
affected parcels.
2.7 The City shall designate in its sole discretion, and on any reasonable conditions, a
portion of its property, described in' Exhibit "E" attached hereto, for Fountain Park's use as a
temporary construction staging area during development of the Tukwila Station site "Staging
Area In utilizing the Staging Area, Fountain Park agrees to the following Indemnity and
Insurance provisions.
2.7 1. Indemnity Fountain Park shall indemnify, defend, and hold harmless
Tukwila, its agents, and employees from and against any and all liability arising from injury or
death to persons or damage to property resulting in whole or in part from negligent acts or
omissions of Fountain Park, its agents, servants, officers, or employees, irrespective of whether
in connection with such act or omission it is alleged or claimed that an act of Fountain Park, its
agents, or employees caused or contributed thereto. In the event that Tulcwila shall elect to
defend itself against any claim or suit arising from such injury, death, or damage, Fountain Park
shall, in addition to indemnifying and holding Tukwila harmless from any liability, indemnify
Tukwila for any and all expenses incurred by Tukwila in defending such claim or suit, including
reasonable attorneys' fees.
2.7.2. Insurance.
2.7.2(i). Fountain Park shall procure and maintain in hill force throughout
the duration of its use of the Staging Area comprehensive general liability insurance with a
minimum coverage of 51,000,000.00 per occurrence /aggregate for personal injury and property
damage. Said policy shall name the City of Tukwila as an additional named insured and shall
include a provision prohibiting cancellation or reduction in the amount of said policy except
upon thirty (30) days prior written notice to Tukwila. Cancellation of the required insurance
shall automatically result in termination of Fountain Park's use of the Staging Area
2.7.2(ii). Certificates of coverage as required by Paragraph 2.7.2(i) above
shall be delivered to Tukwila prior to Fountain Park's use of the Staging Area.
2.8 Fountain Park shall hydro seed, vegetate, and otherwise restore the Staging Area
to its original condition and to the reasonable satisfaction of the City upon completion of
Fountain Park's use of the Staging Area. The City shall thereafter maintain the restored Staging
Area site.
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G: \City Acnmey\PETER\Plannme \Tukwila Station DA 7- 13.doc
2.9 Fountain Park shall extend the existing sidewalk, located on the north side of the
Tukwila Station property, west to the intersection with West Valley Highway The construction
and design standards of the sidewalk must be acceptable to the City's Public Works director.
2.10 The details of the property exchange are set forth in a separate Property
Exchange Agreement, which is incorporated by this reference as if fully set forth herein.
2.11 This Agreement does not guarantee any project approval or that other conditions
outside the terms of this Agreement will not be imposed by the City
2.12 This Agreement supersedes any and all other Development Agreements related
to the property that is the subject of this Agreement.
2.13 Fountain Park's development shall be consistent with the approvals granted by
the City's Planning Commission and Board of Architectural Review dated April 2005 The
conditional use permit approved by the City on April 29, 2005, is renewed.
3 0 General Provisions.
3 1 Assignment of Interests. Rights. and Obligations. This Agreement shall be
binding and inure to the benefit of the Parties. No Party may assign its rights under this
Agreement without the written consent of the other Party, which consent shall not unreasonably
be withheld. This Agreement shall be binding upon and shall inure to the benefit of the heirs,
successors, and assigns of Fountain Park and the City
3.2 Incorporation of Recitals. The Recitals contained in this Agreement, and the
Preamble paragraph preceding the Recitals, are hereby incorporated into this Agreement as if
fully set forth herein.
3.3 Severabilitv If any term or provision in this Agreement, or the application of
any term or provision in this Agreement to a particular situation, is held by a court of competent
jurisdiction to be invalid, void, or unenforceable, the remaining terms and provisions of this
Agreement, or application of this Agreement to other situations, shall continue in full force and
effect unless amended or modified by mutual consent of the Parties. Notwithstanding the
foregoing, if any material provision of this Agreement or the application of such provision to a
particular situation is held to be invalid, void, or unenforceable, either Party may terminate this
Agreement by providing written notice of termination to the other Party
3 4 Termination.
3 4.1 This Agreement may be terminated upon mutual agreement of the Parties.
3 4.2 This Agreement shall terminate upon the abandonment of the development
by Fountain Park. Fountain Park shall be deemed to have abandoned the development if
Fountain Park fails to take title to the property and /or fails to submit development applications
before October 7, 2006.
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G'City Attome9PPh I LR'Planning \Tukwila Station DA 7- 13.doc
3.4.3 This Agreement shall expire and be of no further force and effect if
Fountain Park LLC does not construct the development as contemplated by the approvals
identified in Paragraph 2.13 of this Agreement, and submits applications for development that
are inconsistent with such approvals.
3.5 Enforceability The Parties acknowledge that any willful and material breach of
this Agreement will result in irreparable harm, and therefore, in addition to any other remedies
that the Party would have, the non breaching Party would be entitled to temporary, preliminary
and permanent injunctions prohibiting the breaching Party from any such willful and material
breach. The Parties agree that monetary damages from a breach of this Agreement would be
difficult to ascertain and quantify; thus, specific performance is the proper remedy for any breach
of this Agreement.
3.6 Annlicable Law/Venue. This Agreement shall be construed and enforced in
accordance with the laws of the State of Washington. The venue for any dispute arising under
this Agreement shall be King County Superior Court.
3 7 Notice of Default/Onnortunity to Cure/Dispute Resolution. In the event a Party,
acting in good faith, believes the other Party has violated the terms of this Agreement, the
aggrieved Party shall give the alleged offending Party written notice of the alleged violation by
sending a detailed written statement of the alleged breach. The alleged offending Party shall
have thirty (30) days from receipt of written notice in which to cure the alleged breach. This
notice requirement is intended to facilitate a resolution by the Parties of any dispute prior to the
initiation of litigation. Upon providing notice of an alleged breach, the Parties agree to meet and
agree upon a process for attempting to resolve any dispute arising out of this Agreement. A
lawsuit to enforce the terms of this Agreement shall not be filed until the latter of (a) the end of
the 30 day cure period or (b) the conclusion of any dispute resolution process.
3.8 Attorneys' Fees. In the event of any litigation or dispute resolution process
between the Parties regarding_an alleged breach of this Agreement, neither Party shall be entitled
to any award of attorneys' fees.
3.9 No Third -Partv Beneficiaries. This Agreement is for the benefit of the Parties
hereto only and is not intended to benefit any other person or entity, and no person or entity not a
signatory to this Agreement shall have any third -party beneficiary or other rights whatsoever
under this Agreement. No other person or entity not a Party to this Agreement may enforce the
terms and provisions of this Agreement.
3.10 Continuencies.
3.10.1. Should the Strander project not go forward or should the property
described in Exhibit "B" not be needed by the City, the easement granted by the City for parking
purposes on Exhibit "C" will become a permanent easement.
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G:?City AttomeylPETER1Planning \Tukwila Station DA 7- 13.doc
3 10.2. This Agreement will terminate if development of the project described
herein is not commenced within 180 days of the effective date of this Agreement.
Commencement shall be defined as receiving the required foundation inspection, including
approval therefore by the City
3 11 Entire Agreement. Counterparts. and Exhibits. This Agreement may be
executed in duplicate counterparts, each of which is deemed to be an original. The entire
Agreement consists of eight (8) pages, one (1) notary acknowledgement page, and five (5)
Exhibits, which constitutes in full the final and exclusive understanding and agreement of the
Parties and supersedes all negotiations and previous agreements between the Parties with respect
to all or any part of the subject matter hereof. All waivers of the provisions of this Agreement
shall be in writing and signed by the a authorities of Fountain Park and the City of
Tukwila.
3 12 Authority The Parties each represent and warrant that they have full power and
actual authority to enter into this Agreement and to carry out all actions required of them by this
Agreement. All persons are executing this Agreement in their representative capacities and
represent and warrant that they have full power and authority to bind their respective
organisations.
3 13 Recording. Fountain Park shall record an executed copy of this Agreement with
the King County Auditor, pursuant to RCW 36.70B.190, no later than fourteen (14) days after
the Effective Date.
3.14 Existing Easements. No easement, in existence prior to this Agreement, on the
properties subject to this Agreement, shall be affected by this Agreement.
3.15 Legal Representation. In entering into this Agreement, Fountain Park
represents that it has been advised to seek legal advice and counsel from its attorney concerning
the legal consequences of this Agreement; that it has carefully read the foregoing Agreement and
knows the contents thereof, and signs the same of its own free act; and that it fully understands
and voluntarily accepts the terms and conditions of this Agreement.
3.16 Minor Modifications. Minor modifications from the approved development or
the exhibits attached hereto may be approved by the City's Department of Community
Development Director in accordance with the provisions of the City's code and shall not require
an amendment to this Agreement.
LPN: WITNESS WHEREOF, this Agreement has been entered into by and between Pacific
Commercial Properties and the City of Tukwila as of the day and year first above written.
FOUNTATi I PARK LLC CITY OF TUKWILA
By By
Hyun J Um, Member Steve _Mullet, Mayor
Page 7 of 9
G:`.City Attcme:PETER'Planning\Tukwita Stz&in DA 7- 13.doc
Approved as to Form.
Shelley Kerslake, City Attorney
Page 8 of 9
3.!City Attorney \PETERiPlannine\Tukuila Station DA 77- 13.doc
STATE OF WASHINGTON
ss:
COUNTY OF KING
On this day of 2006, before me personally appeared
Hyun J Um, the Member of Fountain Park LLC, a Washington limited liability company that
executed the within and foregoing instrument, and acknowledged the said instrument to be the
free and voluntary act and deed of said company, for the uses and purposes therein mentioned,
and on oath stated that he was authorized to execute said instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the
day and year first above written.
Printed Name:
NOTARY PUBLIC in and for the State of
Washington
Residing at:
My commission expires:
STATE OF WASHINGTON
ss:
COUNTY OF KENG
On this day of 2006, before me personally appeared
Steve Mullet, known to me to be the Mayor of the City of Tukwila, a Washington municipal
corporation that executed the within and foregoing instrument, and acknowledged the said
instrument to be the free and voluntary act and deed of the City of Tukwila for the uses and
purposes therein mentioned, and on oath stated that he was authorized to execute said instrument.
EN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the
day and year first above written.
Printed Name:
NOTARY PUBLIC in and for the State of
Washington
Residing at:
My commission expires:
Page 9 of 9
G'City Attome}'PElER\P!anningTukwi!a Station DA7- 13.aa=
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PROPOSED PROPERTY EXHIBIT
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1110 4 1 1$2114....E 1 50'1501 EXPIRES MAY 22 2007 ,T
JZL__ -1-
so 1sam sT f N 1
WAY EAS CONSULTANTS. INC.
1 1 I I 410NUMENTEO q 1 415 RAINIER 8L1R7. N.
0 I I SO. 158TH ST ISSAQUAH. WA. 98027
I EXTENDED 1 PH :(425J392 -5351
Exhibit C
PROPOSED EASEMENT DESCRIPTION
CITY OF TUJKWILA TO FOUNTA/N PAIeX L L G
THE WEST 30 FEET OF THE EAST 100,00 FEET OF LOTS 1 AND 2 OF
CITY OF TUKWILA SHORT PLAT NO. L98 -0007 AS FILED UNDER KING
COUNTY RECORDING NUMBER 9803129013, RECORDS OF KING COUNTY,
WASHINGTON.
TOGETHER WITH THE WEST 30 FEET OF THE EAST 100.00 FEET OF THE
_FOLLOWING DESCRIBED PARCEL.
THAT PORTION OF THE HENRY MEADER DONATION CLAIM NO, 46 AND
OF SECTION 24, TOWNSHIP 23 NORTH, RANGE 4 EAST, W.M., IN KING
COUNTY, WASHINGTON, LYING WEST OF THE BURLINGTON "NORTHERN
RAILROAD RIGHT- OP-WAY, EAST OF THE UNION PACIFIC RAILROAD
RIGHT -OF -WAY, AND SOUTH OFA LINE 137 FEET SOUTH OF THE NORTH
LINE QFSAID DONATION CLAIM AND NORTH OF THE CENTERLINE OF
LONGACRES WAY.
4941.14-4>A 1
4 C
Al 1AO
EXPIRES MAY 22 2007
PROPOSED PROPERTY EXHIBIT
AREA TO BE ABANDONED BY UNION PACIFIC RAILROAD
AND ACQUIRED BY FOUNTA /N PARK. LLC
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PROPOSED AREA TO BE 1
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SO_ 158TH ST LONGACnS
WAY EASTSAOE CONSULTANTS, INC.
L MONUMENTED 415 RAINIER BLVD. N.
1 1 50, 159T71 ST I ISSAQUAH, WA. 98027
I I 1 IXTEN I PH: (425]392 -5351
Exhibit D
i
PROPOSED LEGAL DESCRIPTION
AREA TO BE ABANDONED BY UNION PACIFIC RAILROAD
AND ACQUIRED BY FOUN7A /N PAieK L LL
THE EAST 43.00 FEET OF THE FOLLOWING DESCRIBED PARCEL.
THAT PORTION OF THE 100 FOOT WIDE UNION PACIFIC RAILROAD
RIGHT OF WAY (A.K.A. CHICAGO MILWAUKEE ST. PAUL AMD PACIFIC
RAILROAD) LOCATED IN THE SOUTHWEST QUARTER OF SECTION 24,
TOWNSHIP23 NORTH, RANGE 4 EAST, W.M., IN KING COUNTY,
WASHINGTON, WHICH LIES NORTHERLY OF THE CENTERLINE OF
LONGACRES WAY AND SOUTHERLY OF PRIMARY STATE HIGHWAY
NUMBER 1 (INTERSTATE 405)
CONTAINING AN AREA OF 59, 180 SQUARE FEET MORE OR LESS.
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Exhibit E
Finance Safety Committee
July 17, 2006 5:00 p.m.
tsent: Pam Carter, Chair; Jim Haggerton, and Verna Griffin
Rhonda Berry; Kevin Fuhrer; Shelley Kerslake; Peter Beckwith; Mary Miotke; Lori Sutter; Jane Cantu; Christy
O'Flaherty; Diane Jenkins; Chuck Parrish, community member; and Ed Garth, Coscomm.
Business Aaenda
A. Proposed changes to Ethics Code
Pam indicated that the Council asked Shelley to develop two options regarding the handing of ethics complaints. Jim
asked if the intent was to forward the two options to the Council; Pam responded that that was the request of the
Council. Shelley related that in addition, the Police Guild filed an Unfair Labor Practice (ULP) alleging that the
ordinance infringed upon their rights under their Collective Bargaining Agreement; a tentative agreement has been
reached. if the Council adopts the ordinance, then the Police Guild will dismiss their ULP The proposed changes are
not substantive and merely clarify the intent of the ordinance. Unanimous approval, forward to COW.
B. Tukwila Station
Kevin provided an update on the Tukwila Station development proposal. Once again the City has the opportunity to
enter into a public/private partnership with a private developer This would be a mixed -use development in the
Tukwila Urban Center (TUC) with 250 -300 condominiums and a small amount of retail space. Previously the Council
entered into a development agreement with Pacific Commercial Properties (PCP) to proceed with the Tukwila Station
development which was subsequently extended trying to give the developer additional time to secure funding for the
project. Finally, that agreement was allowed to lapse. The City would like enter into a development agreement with
Fountain Park LLC. He described the parcel of land owned by the City The City purchased the property to assist in
the development of a convention center, the property was purchased for $1 45 million using HotetIMotel Tax Fund via
an interfund loan from the General-and Arterial Street funds. This will be paid back over time. To date, 5200,000 in
principal has been paid. The remaining annual payments have been interest only The developer is proposing a land
swap, value for value. Some attractive features of this land swap for the City are that it will assist in the acquisition of
right -of -ways which would be required for the City of Tukwila to purchase for the City of Renton's future extension of
Strander Boulevard. This will involve the relocation of the Union Pacific Railroad (UPRR) right -of -way from its current
location to a location adjacent and west of the existing Burlington Northern right of-way which is currently owned by
Fountain Park. Also, additional revenues would be generated to the City through construction, property tax, building
permitlfees, etc., approximately 51.2 million. To facilitate the relocation of the UPRR, Tukwila would be required to
acquire through condemnation the property required for the Strander project This would be costly if the property
would have been fully developed. Tukwila owns 1.63 acres of land immediately north of the Tukwila station, of which
36,000 sq. ft. are subject to this agreement. Referring to the maps (32 -40), the city would have a 100 ft. swath to
assist in relocation the railroad right -of -way; the developer could use approximately a 13 ft. strip for temporary
parking. Once the UPRR is ready to relocate, the City would swap this 100 ft. swath. The developer would then
demolish the temporary parking and 43 ft of the 100 ft. would become permanent parking, leaving the City with a
57 ft. swath. The City would have the option of marketing this property or selling it. The developer has expressed an
interest in purchasing the property and would be required to submit a bid once an appraisal has been obtained. This
development would help to change the character of the TUC. Possible scenarios on the relocation of the temporary
station were discussed; the details will be refined through the permitting process. Jim noted that this accomplishes
several objectives for the City Unanimous approval, forward to COW.
C. Coscomm International
Mary provided a brief overview of Coscomm project. The first phase of the pilot program provided data
communication capabilities where terrestrial services could not be provided. The second proposed phase would
implement satellite technologies for communicating between patrol cars and provide an authorized satellite gateway
residing at the Tukwila IT Department The City's relationship with Coscomm will be twofold: the Tukwila Police
Department will become official customers of Coscomm's services and become a showcase agency, and secondly,
the IT Department will partner with Coscomm to host a satellite gateway computer to WSP and other Coscomm public
safety agencies. Coscomm would pay Tukwila a percentage of the service fees collected from other agency
customers. In addition, because of Tukwila's cooperation during the beta testing and agreeing to be a showcase
agency, Tukwila patrol cars would be outfitted with all necessary satellite communication equipment at a very nominal
charge. Ed described how this technology works and how it would be installed in the police and command vehicles.
A draft of the proposed agreement was attached and noted that additional revisions may be forthcoming. Unanimous
approval, forward to COW.
Old Business
Pam indicated that a meeting would be held with animal control on July 19 to address some concerns and issues.
Adjournment: 6:00 p.m.
C Committee Chair Approval
Minutes by DJ.
r^ f City of Tukwila
no-, /le a r.
t h
6200Sout hcentar Boulevard •Tucnl3, Washington 98188 Steven 14. Muliet, Mayor
7908
DATE: February 22, 2005
TO: Committee of the Whole.
FROM: Steve Lancaster, DCD D
Kevin Fuhrer, Finance Director
SUBJECT Public/Private partnership rel o Strander Extension and
Pacific Commercial Properties proposal for "Tukwila Station"
The City has an opportunity to enter into a public/private partnership with a private developer.
This partnership would involve an exchange of real property with Pacific Commercial Properties
in order to facilitate:
1. the future extension of Strander Boulevard, and
2. a mixed -use transit- oriented development proposal with positive implications for
the TUC.
This amendment was considered by the CAP Committee on February 15, 2005. The conceptual
agreement was approved and forwarded to the COW for consideration.
BACKGROUND
Strander Extension Renton has identified a preferred alternative for the future extension of
Strander Boulevard eastward from West Valley fllghsvay. Tukwila has informally concurred
The preferred alternative would require relocation of the Union Pacific Railroad (UPRR) right
of-way from its current location to a location adjacent to and west of the existing Burlington
Northern right-of-way (see Figure 1). This alternative has cost advantages for the project, and
additional advantages for Tukwila relating to the future development potential of the area A
potential risk of this alternative is that development could occur on the portion of the future
UPRR right-of-way currently owned by Stuart McLeod, thus making future right-of-way
acquisition more expensive and possibly threatening the viability of the Strander Extension
project.
Tukwila Station PrnnasaL Pacific Commercial Properties (PCP) has proposed a mixed -use
development on property currently owned by Stuart McCleod. The property is located north of
Longacres Way, between the Union Pacific and the Burlington Northern rights-of-way, The
project, tentatively named 'Tukwila Station," would include approximately 250 to.300
residential units and about 5,000 square feet of commercial space.
The City of Tukwila owns approximately 1.63 acres ofland immediately north of the Tukwila
Station site.
Phone: 206.433 -1800 Ctry Haft Far 206- 433 -7833 swnvcLtukwpawatts
PROPOSAL
Pacific Commercial Properties (PCP) has indicated a willingness to work with the City for the
purposes of this land exchange. The sequence of transactions is keyed to Figure 2 and would be
as follows:
Step 1 PCP transfers the easternmost 100 -foot strip of their property to the City, retaining a 30-
foot easement for interim paling purposes. This eastern 100 foot strip is needed for relocation
of the Union Pacific RR right -of -way to Tukwila and measures approximately 103,525 sq. It
Step 2 The City transfers a portion (approx. 36,590 sq. ft )of its property to the north to PCP,
which PCP will use as a portion of its Tukwila Station development.
Step 3 At the point in time where Strander is ready to be constructed and the Union Pacific
right -of-way is ready to be relocated, PCP would relinquish its easement and the City would
transfer 43 feet of the oldUPxight -of -way to PCP (approx 59,180 sq. ft.). PCP would relocate
its displaced parking from the easement on the east of its property, to this 43 -foot a on the
west.
At the end of this process, PCP would have transferred 103,525 square feet of property to the
City; the City would have transferred 95,770 square feet to PCP All this would be detailed in a
development agreement.
SRQUENCE
1. PCP transfers area shown to the City, retaining 30 -foot easement for parking purposes.
2. City transfers area shown to PCP
3. When funding for the Strand& project has been secured and the project is in the design
phase, the City transfers 100-foot ship of property to Union Pacific RR in exchange for "old"
UP right of way, in conjunction with Strander extension. City transfers 43' wide area shown
to PCP
FINANCIAL IMPLICATIONS
By way of background, the HotellMotel Tax Fund (101) purchased the land for 31,450,000 with
resources received via an inteafimd loan from the General and Arterial Street Funds. The
outstanding loan balance as of December 31, 2004, was 31,250,000. The 2005 Budget provides
for a 5200,000 loan repayment This would leave a balance owing to the General and Arterial
Street Funds of 31,050,000 as of Deceanber 31, 2005.
The Lodging Tax Committee may accept a transfer of land ownership to the General Fund in
exchange for the debt forgiveness. However, the Lodging Tax Committee may not approve this
transaction if the appraised value is determined to be below 51 million. Preparations are
presently underway to settee appraisal services. The land transfer proposal will be discussed
with the Lodging Tax Advisory Committee on March 3, 2005.
2
If the transfer is approved through the developer agreement, the planning model will initially be
reduced by the amount of the interfund loan balance remaining. The reduction will be mitigated
by the revenue opportunities Char are addressed in the next section of this memorandum
REVENUE OPPORTUNTTTES
The Tukwila Station Project proposal stands to generate (4) revenue sources for the City
property tax, sales tax, real estate excise tax (REST), and the building permits and fees. In
discussions with the developer, he has indicated a S65 million dollar valuation at buildout with
estimated construction costs of S30 million. Given the indicated values, the following revenues
could reasonably be expected from the proposed project
Property TaxA SI00,000 Construction
Property Tax B S100,000 Annual
Sales Tax S300,000 ConstructionPeiiod
REEF $250,000 Period of Initial Saks
Build Permit/Fees '$350,000 Application Period
Again as addressed in the financial implications section of this memorandum, these revenues
would offset the reduction in the planning model for the amount of the interfund loan balance
payable at the time the land transfer is executed.
OTHER CONSIDERATIONS
If the City does not partner with Pacific Commercial Properties to facilitate this land transaction
work, it is likely we will be faced with a proposal to develop the McLeod site in a manner that
will preclude the cement plans for extending Sirander. Al the very least, full development of the
McLeod property would significantly increase the future cost of the Strand= extension project,
possibly affecting its viability.
RECOMMENDATION
Conceptually approve publidprivate partnership with Pacific Commercial Properties. Forward
this conceptual approval in conjunction with approval ofmulli- familyTOD amendment to the
February2S meeting of the Council of the Whole. Authorize Staff to prepare public/private
partnership ag reement with Pacific Commercial Properties,
3
City of Tukwila Page 5 o 9
Cif+ Councl Reautar Meetino Minutes Aorl 4. 2005
1 Paul Sheehan. Tukwila resident and owner of Far west Paints, reiterated the sentiments of Mr.
Schweigert and sought Garifiretion to Petition- 4 43.40.68. He made a request (for more informaEan) from
Ms. Mosqueda, relative to the use of fire trucks in the area The issue has to do with a private property
ramp going onto public property. Ms. Mosqueda made note of the request.
8:13 p.m_ Council de5beratons ensued with suggested comments and edits to be worked and/or
incorporated into the draft ordnances to be presented at a future Committee of Wno!e meeting. With
those newly suggested edits and/or additional negotiation points presented to the Development Engineer,
she noted it may take as much as three weeks to return with draft ordinances.
8:29 p.m. Mayor Mullet Cased the pubic hearing.
(Clerical note 04.05 -05 —This issue will appear on the 04-25-05 agenda for consideration by the
Committee of Whole.)
Yc O Development anmement between Par tc Commercial Pronerfies !PCP and the City of
Tukwila for the deverpment of a mulfi- family condominium pro et vrthin the Transit-
Oriented Devetpment flQ01 area of the Tukkwla Urban Center (TUGI. more commonly
known as Tukwila Station.'
829 p.m Jack Pace, Deputy Director of Community Development, told Council the proposed
devefopsr's agreement provides the framework, as agreed upon by the parties, to carry
out tasks and duties associated wlh the Tukwila Station project
8:34 p.m. Mayor Mullet opened the pubic hearing and called for pubrx testimony.
8:35 p.m. Hearing no pubic testimony, Mayor Mullet closed the public hearing.
Action to follow under the heading of unfinished business.
UNFINISHED BUSINESS:
y Authorize Mavor In cian a development agreement with Pacific Commercial PmcerEes
(PCP) for the development of a multi -family cnndnminium nm ;rr& commonly known an
`Tukwila Station'
CARTER MOVED; DUFFLE SECONDED; TO AUTHORIZE MAYOR TO SIGN A DEVELOPMENT
AGREEMENT WITH PACIFIC COMMERCIAL PROPERTIES (PCP) FOR THE DEVELOPMENT OF A
MULTI- FAMILY CONDOMINIUM PROJECT COMMONLY KNOWN AS "TUKWILA STATION." The
motion caned 6-0. MI
b An ordinance edn.• viand renii ntions i nuti mil -'no in the Tukycla
n Center to ...1 neiforienled akmment in MT to the Sn under
uter Patti trakS. Ilr
A21.'. OF THE CRY COON o- CITY OF TUI6YLq W -'GTON,
DEFINING moRENTED r a HOUSI.•(w ADO G ED
RE a' r MULTI-Fr HOUSING IN THE `SA
-.o TO ALLOW l •REVEL.. 3 IN PRO
IN
SWtC -•kdNTER ATIOK 1758 SECTION 1: 1 7; 1971 21, 830 SEC 20, 21, 22; 1 ts
34 AND 35; P9 7; 1471 •N 12: t 4 SECTION 5: 197-
I SECTIONS 49, 50 AND 51; CfON 4, 1989 SE 7 c; SECTION 4; 2045
TI
SECON 9; AND 2021 4. AS CODIFIED CHAPTER 18.28;
IN
PROVIDG FORS A: AND ESTAWSBIRG AN a DATE