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Home My WebLink AboutCDN 2017-04-24 COMPLETE AGENDA PACKET *� City of Tukwila Distribution: Community Development& K. Hougardy Mayor Ekberg V.Seal D.Cline K. Kruller C. O'Flaherty Neighborhoods Committee D. Robertson L. Humphrey O Kathy Hougardy, Chair r O Verna Seal O Kate Kruller AGENDA MONDAY,APRIL 24, 2017—5:30 PM HAZELNUT CONFERENCE ROOM (At east entrance of City Hall) Item Recommended Action Page 1. PRESENTATION(S) 2. BUSINESS AGENDA a. An ordinance amending the multi-family residential a. Forward to 5/8 C.O.W. Pg.1 property tax exemption (MFTE). and 5/15 Regular Mtg. Lynn Miranda, Senior Planner b. Update on Tukwila International Boulevard b. Committee consideration Pg.9 implementation and Congress for New Urbanism (CNU) and input. workshop. Lynn Miranda, Senior Planner 3. ANNOUNCEMENTS 4. MISCELLANEOUS Next Scheduled Meeting: Monday, May8, 2017 The City of Tukwila strives to accommodate individuals with disabilities. Please contact the City Clerk's Office at 206-433-1800 (TukwilaCitvClerk@TukwilaWA.aov) for assistance. City of Tukwila Allan Ekberg, Mayor INFORMATIONAL MEMORANDUM TO: Community Development and Neighborhoods Committee FROM: Jack Pace, DCD Director BY: Lynn Miranda, Senior Planner CC: Mayor Ekberg DATE: April 19, 2017 SUBJECT: An Ordinance amending TMC 3.90 Multi-Family Residential Property Tax Exemption ISSUE Under TMC 3.90, applications for multi-family tax exemptions offered as an incentive to stimulate the construction of new housing in limited areas in the Tukwila Urban Center were no longer accepted after December 31, 2016. The Council is being asked to consider and approve an ordinance amending TMC 3.90 to extend the deadline to apply for the property tax exemption until December 31, 2017. BACKGROUND Tukwila City Council adopted Ordinance 2462 in 2014 allowing the use of the Multifamily Property Tax Exemption (MFTE) as an incentive to encourage residential development of market rate and affordable housing within a portion of the Southcenter area zoned Transit Oriented Development(TUC-TOD) located west of the Green River. If a project met certain State eligibility criteria set forth in RCW 84.14, the qualified residential units would be exempt from ad valorem property taxes for eight years; twelve years if providing.affordable housing. The property tax exemption applies to the qualified housing units only, not on the value of land or commercial properties. Once the exemption period ends, the structures are placed on the property tax rolls based on their original new construction value. The intent was to stimulate the construction of pioneer multifamily developments in the urban center, not to provide an on-going subsidy. Per TMC 3.90.060.D, the deadline for applying for the property tax incentive was December 31, 2016. Washington Place is the only project that utilized the MFTE program. DISCUSSION The Southcenter Plan describes the TOD district as an emerging mixed-use, residential neighborhood. The City has invested in this vision with improvements such as the transit center, the pedestrian bridge over the Green River, and upcoming changes to Baker Boulevard including new sidewalks, on-street parking, and bike lanes. These public improvements combined with the MFTE incentive served to catalyze the first residential project for the urban center, Washington Place. Staff believes extending the multifamily property tax exemption application period for a limited time is a necessary incentive to construct additional housing in the urban center. Recently, 1 INFORMATIONAL MEMO Page 2 developers have expressed interest in constructing Class A market rate apartments in the TOD district. However, there are no existing rents on new apartments or condos near this area, making it difficult to get financing. Washington Place, currently under construction, cannot provide comparables as it will not lease up for at least 18 months. Consequently, the developers have requested that the MFTE program be extended through 2017 to increase the feasibility of their project. The only change being requested is extension of the application period for the remaining year. All other aspects of the TMC 3.90 Multi-family Residential Property Tax Exemption, including duration of exemption, project eligibility, application procedures and review, and annual certification, remain the same. After one or two additional projects are completed and rented, we may learn that the rents are high enough to justify additional development without needing the incentive. FINANCIAL IMPACT If the multifamily residential property tax exemption was approved for a project, it would delay when the City and other taxing districts would start receiving property tax on the new construction by eight or twelve years. RECOMMENDATION The Council is being asked to hold a public hearing on the ordinance at the May 8, 2017 Committee of the Whole and consider this item at the subsequent May 15, 2017 Regular Meeting. ATTACHMENTS Draft Ordinance Figure 3-1 Map of Targeted Residential Area 2 W:\Users\LYNNM\MFTE revision\InfoMemo_MFTE_FINAL.doc DRAFT AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, AMENDING ORDINANCE NO. 2462 §8, AS CODIFIED AT TUKWILA MUNICIPAL CODE CHAPTER 3.90, "MULTI-FAMILY RESIDENTIAL PROPERTY TAX EXEMPTION," TO EXTEND THE DEADLINE TO APPLY FOR THE PROPERTY TAX EXEMPTION; PROVIDING FOR SEVERABILITY; AND ESTABLISHING AN EFFECTIVE DATE. WHEREAS, Chapter 84.14 RCW authorizes cities to provide for exemptions from ad valorem property taxation on qualified multi-family housing developments located in designated residential targeted areas in order to encourage more desirable and convenient residential units in urban centers; and WHEREAS, the King County Countywide Planning Policies (KCCPP), developed pursuant to the Washington State Growth Management Act, have established standards for cities to plan for their share of regional growth and affordable housing; and WHEREAS, the Tukwila Urban Center is one of the region's designated urban centers and lies within an urban growth area; and WHEREAS, the City intends to assist in achieving its residential growth targets and goals in the City's Housing and Urban Center Element of the City's Comprehensive Plan by encouraging new multi-family housing in the Tukwila Urban Center; and WHEREAS, the Tukwila Urban Center currently lacks sufficient available, desirable and convenient residential housing, including affordable housing, to meet the needs of the public who would be likely to live in the urban center, if the affordable, desirable, attractive, and livable places to live were available; and WHEREAS, the Tukwila Urban Center qualifies as an urban center for purposes of RCW 84.14.010 and Tukwila has a desire to stimulate new construction of multi-family housing within that portion of the Tukwila Urban Center's Transit Oriented Development district that lies west of the Green River; and W:Word Processing\Ordinances\Property tax exemption for qualified multi-family housing extended 4-11-17.doc LM:bjs Page 1 of 3 3 WHEREAS, the tax incentive provided by Chapter 84.14 RCW encourages increased residential opportunities, including affordable housing opportunities, and will stimulate the construction of new multi-family housing within the residential targeted area and will benefit and promote public health, safety, and welfare by encouraging residential development and redevelopment of that area of the City; and WHEREAS, the tax incentive regulations were adopted by the Tukwila City Council in Ordinance No. 2462 on December 1, 2014; and WHEREAS, under Tukwila Municipal Code Section 3.90.060, applications for a multi- family tax exemption were no longer accepted after December 31, 2016, and the Tukwila City Council desires to continue offering an incentive to stimulate the construction of new housing within a portion of the Tukwila Urban Center Transit Oriented Development district for a limited period of time; and WHEREAS, on May 8, 2017, the Tukwila City Council, after giving public notice as required by RCW 84.14.040, held a public hearing to consider adoption of the proposed ordinance; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, HEREBY ORDAINS AS FOLLOWS: Section 1. Ordinance No. 2462 §8, as codified at Tukwila Municipal Code Section 3.90.060, is hereby amended to read as follows: 3.90.060 Application Procedure— Fee A. The owner of property applying for exemption under this chapter shall submit an application to the Administrator, on a form established by the Administrator. The owner shall verify the contents of the application by oath or affirmation. The application shall contain the following information: 1. A brief written description of the project, including phasing if applicable, that states which units are proposed for the exemption and whether the request is for 8 or 12 years. 2. Preliminary schematic site and floor plans of the multi-family units and the structure(s) in which they are proposed to be located. 3. A table of all units in the project listing unit number, square footage, unit type (studio, one bedroom, etc.), and indicating those proposed for the exemption. 4. If applicable, information describing how the applicant will comply with the affordability requirements in TMC Sections 3.90.040 and 3.90.050. 5. A statement from the owner acknowledging the potential tax liability when the property ceases to be eligible for exemption under this chapter. 6. Any other information deemed necessary or useful by the Administrator. W:Word Processing\Ordinances\Property tax exemption for qualified multi-family housing extended 4-11-17.doc LM:bjs Page 2 of 3 4 B. At the time of application under this section, the applicant shall pay to the City an initial application fee of $500 or as otherwise established by ordinance or resolution. If the application is denied, the City may retain that portion of the application fee attributable to its own administrative costs and refund the balance to the applicant. C. The complete application shall be submitted any time before, but no later than, the date the certificate of occupancy is issued under Title 16 of the Tukwila Municipal Code. D. After December 31, 2-0-'4- 2017, the City will no longer accept applications. Section 2. Corrections by City Clerk or Code Reviser. Upon approval of the City Attorney, the City Clerk and the code reviser are authorized to make necessary corrections to this ordinance, including the correction of clerical errors; references to other local, state or federal laws, codes, rules, or regulations; or ordinance numbering and section/subsection numbering. Section 3. Severability. If any section, subsection, paragraph, sentence, clause or phrase of this ordinance or its application to any person or situation should be held to be invalid or unconstitutional for any reason by a court of competent jurisdiction, such invalidity or unconstitutionality shall not affect the validity or constitutionality of the remaining portions of this ordinance or its application to any other person or situation. Section 4. Effective Date. This ordinance or a summary thereof shall be published in the official newspaper of the City, and shall take effect and be in full force five days after passage and publication as provided by law. PASSED BY THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, at a Regular Meeting thereof this day of 12017. ATTEST/AUTH E NTI CATE D: Christy O'Flaherty, MMC, City Clerk Allan Ekberg, Mayor APPROVED AS TO FORM BY: Filed with the City Clerk: Passed by the City Council: Published: Effective Date: Rachel B. Turpin, City Attorney Ordinance Number: W:Word Processing\Ordinances\Property tax exemption for qualified multi-family housing extended 4-11-17.doc LM:bjs Page 3 of 3 5 6 Figure 3-1 Map of Targeted Residential Area m x: T N N' m,. i er r , City of Tukwila Multi-Family Property Tax Exemption Residential Targeted Area ® Target Parcels. ZoningCode Q TUC-TOD Zone N 7 8 City of Tukwila Allan Ekberg, Mayor ••= INFORMATIONAL MEMORANDUM To: Community Development and Neighborhoods Committee From: Jack Pace, Director Community Development Bob Giberson, Director Public Works By: Moira Bradshaw and Lynn Miranda CC: Mayor Ekberg Date: April 19, 2017 Subject: Tukwila International Boulevard (TIB) Comprehensive Plan implementation Issue Update on work program for TIB Plan implementation & Congress for New Urbanism (CNU) recommendations. Background The opportunity to be assisted by the Congress for New Urbanism and their professional membership presented itself to the City in August of 2016. By October there was agreement that implementation of the City of Tukwila's goals for the Tukwila International Boulevard neighborhood would be a good project for CNU's Legacy Program, which pulls together a relevant team of consultants from their members. The three-day event occurred in Tukwila from February 23-25 and CND's final report will be presented at the May 1, 2017 City Council meeting. The CNU recommends that the City make supportive changes to development standards and regulations for the TIB corridor to make it more land use, pedestrian and bike friendly. There are several requirements that must occur before implementation can move forward. Discussion Three main steps must be taken to follow-through on implementing CNU's recommendations: 1. Ordinances must be drafted and circulated for review. The CNU draft recommendations involve changes to the Comprehensive Plan and Zoning Code maps as well as modifications to the Zoning Code. Transportation modeling of changes that might occur to street intersection level of service due to new street cross-sections are needed. 2. Environmental analysis in the form of a supplemental to the Comprehensive Plan's EIS is required before any action may be taken by the City. 3. Public outreach and supporting materials and scheduling are needed. Changes to land use regulations must be reviewed with the affected property owners in addition to the broader community and overall changes in the transportation system require review by the overall neighborhood and coordination with the City of SeaTac. 9 INFORMATIONAL MEMO Page 2 TIB Neighborhood Plan 2017 DRAFT Work Program April 15 CNU Draft Report April 24 CDN Committee Review of Work Program May 1 CNU Final Report Presentation —City Council Meeting May Transportation Analysis for TIB Redesign and Coordination with City of SeaTac on impacts and transitions. May - June Draft Comp Plan and Zoning Code Amendments May - June Supplemental EIS to Comprehensive Plan EIS (City of Tukwila 1995) June Schedule Outreach events July Publish Draft TIB Amendments and begin Public Outreach September Joint Session of City Council and Planning Commission on Draft TIB Plan September 26 Transportation Committee review of CIP changes for project September 28 Planning Commission Public Hearing October 5 Planning Commission Deliberation/Decision October 23 City Council C.O.W. work session November 13 City Council Public Hearing November 27 City Council discussion December 4 City Council adopts changes at Regular Meeting Products: -Comprehensive Plan Map Amendments -Zoning Code and Map Amendments -Supplemental EIS -Infrastructure Design and Construction Standards amendments -Capital Improvement Program Financial impact There will be consultant costs to provide the required transportation analysis and SEPA review. The funds for this effort will be taken from the Professional Services accounts of each Department. A future budget amendment in the next biennial budget of 2018-2019 will be needed for the rechannelization/paint striping and signage and possibly to cover consultant costs. Recommendation Discuss and provide feedback on work schedule. 10