Notes from Shoreline council meeting September 13, 2021

Pam Cross, reporter

Shoreline City Council Meeting  

September 13, 2021

Notes by Pam Cross

Mayor Hall called the remote meeting to order at 7:00pm.

All Councilmembers were present. 

Proclamation

I, Will Hall, Mayor of the City of Shoreline, on behalf of the Shoreline City Council, recognize September 10-19, 2021 as WELCOMING WEEK in the City of Shoreline and encourage residents to build communities where all feel a sense of belonging and can thrive.

Approval of the Agenda 

Agenda adopted by unanimous consent. 

Report of the City Manager, presented by John Norris, Assistant City Manager 

COVID-19 UPDATE 

WELCOMING WEEK  virtual workshops

SHORELINE WALKS

This week’s walk is around the southwest Shoreline on Saturday September 18.

For information and a full calendar of all the walks that will be held, go to: shorelinewa.gov/shorelinewalks

ART COTTAGE RESIDENCY PERFORMANCES 

Public Reminders

The Planning Commission Meeting for September 16 has been cancelled.

Council Reports

Mayor Hall: I made some brief opening remarks at the Seattle Film Summit. After I spoke, an audience member came up to me. They explained they are a director putting together a film and was so impressed that in Shoreline filming in a park would require only a $25 fee and approval could be expected within 3 days. Other places take about 60 days for approval.

Public Comment 

Daniel Wick, Shoreline

Re 8(a) Multifamily tax exemption program. I am involved in 2 apartment projects right now. The 12 year cost has been a great incentive but as costs have increased it makes it a challenge to build these projects. I support the 20 year program.

Jackie Kurle, Shoreline

The enhanced shelter has so far been a successful operation. I have seen a couple of residents or possibly guests that could be taken into the shelter that are on the gravel behind the shelter or on side streets. Have they been offered residence at the shelter?

Approval of the Consent Calendar

Consent Calendar approved unanimously

Study Item 8(a) Discussion of Ordinance No. 944 – Amending Ordinance No. 776 and Ordinance No. 694 Amending Shoreline Municipal Code Chapter 3.27 for Property Tax Exemption Conditions Within the Light Rail Station Subareas and Within the Multifamily Tax Exemption (MFTE) Areas

Presentation by Nathan Daum, Economic Development Manager

The Multifamily Property Tax Exemption (MFTE) program is the City’s main affordable housing program. The MFTE program provides for a 12-year property tax exemption on new housing construction and improvements as an incentive. This does not exempt the land valuation or non housing-related improvements from taxation. For a development to qualify, a project must be multifamily housing development with at least 20% of the units meeting the affordable housing definition in Shoreline Municipal Code. The light rail station areas are the only residential targeted areas (RTAs) in Shoreline to have a MFTE sunset date. To date, no multifamily buildings have been completed in the light rail station areas.

The purpose of this discussion is to consider options to maintain, repeal, or extend the MFTE sunset in the light rail station area residential target areas; adoption of a 20-year MFTE program; and adoption of a 12-year MFTE contract extension.

 

A typical project in Shoreline is 125 units. 

Details of the financial impact to the City are available in the staff report.

 

DISCUSSION 

Do we currently have 99 year expectation of affordability?

• Reply: Yes, in station areas which is tied to the land use, not the MFTE. 

There are no developments in the light rail area yet? Are there any applications?

• Reply: Yes, quite bit of interest and some pre-application meetings. We’ve been told they are watching to how it MFTE develops, construction costs. No new applications have moved into construction. There are one or two small (15-20 unit) projects under construction on 185th. None completed and none in the core of MUR70.

Regarding the 12 year extension, is this one time only, or are we looking at it every 12 years?

• Reply: I do not believe the legislation contemplates continuing extensions. It is a one time extension and we are not recommending it for the 20 year program.

Regarding the 20 year MTFE, did someone look to see if this length will pencil out? It makes it better, but is it enough?

• Reply: that’s the big question. Every site and every project is different. Affordability is usually reached at the age 30. There are so many changes after 30 years: zoning, technology, environmental concerns, etc 

Some feel certainty for 20 years. Terms of financing is a challenge.  It would be wonderful to have a qualitative analysis, but there are so many variables.

The numbers showing benefits to the City is really valuable. For ease of future councils, we need the boundaries match with the comprehensive plan rather than the current zoning. I would like to extend the 20 year option to a handful of places. 

I’m less sold on 12 yr extension, according to the math the city loses money. I’d like to see how much people are actually saving in these affordable units.

• Reply: I will look into that.

How many MUR70 projects are in the pipeline?

• Reply: One is almost to final permits. Lots of interest but that’s it. 

We are talking about 20 years. This takes time. It’s not happening. We’re not even at the beginning. So we need to provide enough time for those developments to happen. These are mostly residential areas - not empty lots which are easier to develop.

Regarding the 8 buildings that are currently in design and permitting, if their permit come through before we decide on the 20 year, are they automatically applying to the 20, or do they have to go through the process and additional costs?

• Reply: They have to resubmit for the new program. 

Would there be an additional cost?

• Reply: yes

Is there something we can do about that?

• Reply: We can bring that back as an option. A possible fee waiver since the program wasn’t available before.

The 99 year expectation of affordability sounds a little excessive. This is kind of a sticking point for some developers. We should reconsider this at a later date.

We have a lot of development going on around us, but not here in Shoreline. So this will help catch us up with them. I also agree that the 99 years is worth discussing. 

When we came up with 99 years in 2014, we were being innovative. Lol. We just didn’t want them all running out of affordability in 12 years. Now it makes sense to take another look. 

The legislature, when authorizing the 20 year program, requires 99 years of affordable housing. So if we change that, we could risk the chance of losing the 20 year program.  

This will come back on September 27 as an action item.

Study Item 8(b) Discussion of Proposed American Rescue Plan Act (ARPA) Capital Funding Allocation Update

Presentation by 

Susana Villamarin, RCCS Senior Management Analyst

Tricia Juhnke, City Engineer 

The American Rescue Plan Act, which was signed into law by President Biden on March 11, 2021, is a $1.9 trillion economic stimulus bill. The City of Shoreline was awarded $7,533,842 and will receive the funds in two tranches. The first tranche was received in August 2021 and the second will be received in August 2022. 

At the June 14, 2021 City Council meeting, the Council agreed with the City Manager’s overall recommended targeted allocations, and additional focus areas were discussed. 

The City added criteria for spending on infrastructure. 

Details are available in the Staff Report. The two large projects recommended for funding are in the station areas

DISCUSSION

This is our second discussion and we all had a of comments last time and l have strong concerns about these recommendations.

This is the American Rescue Plan designed for recovery from COVID to benefit everyone in the City. COVID affected every single neighborhood in Shoreline. But these recommendations are all going to the light rail areas. $4M of $7M is going to sewer and wastewater projects in the light rail area. That does not sit well with me. Focusing on one area is a real problem for me. The staff proposed solution to fix this, is to do the exact same thing. The real fix to this is to do what Ms. Juhnke said last: have a resolution that comes up with a package. ARPA does allow swapping out funds. This needs to be transparent. I want this to be one package we are passing that says we’re getting an extra unexpected $4M for infrastructure, and  we’re going to make the City a better place throughout. Hidden Lake was a project considered but not selected by staff. I suggest we move forward with the staff recommendation, modified to include a resolution to move the ARPA funding to Hidden Lake and other projects when the Capital Improvement Program (CIP) funding comes through.

I disagree. I appreciate the staff work. Yes, the recommended projects are in the station areas, but I feel more confident about these than previously. The projects do provide some environmental benefits that are spelled out. I think we want to fund bigger projects. 

We need to remember that staff understands that the larger projects are most cost effective so that even the recommended smaller projects fell off the table. Staff weighed the various projects and I respect their decisions. 

Looking at the idea of the resolution of a package to swap out funds, is that likely what we would have seen as part of the CIP, or are those items still up for debate or discussion?

• Reply by T. Juhnke: They are most likely what you would see but they are always up for debate or discussion. I realize this doesn’t really answer your question.

I guess I feel like I could go either way on this because essentially, the extra $4M could go to the two large projects or the smaller ones. It’s the same. If we add the resolution, are we constraining things that we would have, since the CIP isn’t decided until later. 

• Comment by D. Tarry:  In the staff report we did identify projects that, if we use ARPA money on the big projects, then we could shift the CIP utility funds to these projects.

I think the resolution does not conflict with the staff recommendation, but addresses the challenge of “selling” this to a wider audience. How do we tell everyone that we’re taking the largest part of our recovery act funds and doing projects that aren’t going to help a whole lot of people? Let’s identify, within the resolution, these additional project to show the sum of the whole. I don’t think we’re disagreeing conceptually. I support the resolution.

We are just providing guidance to staff at this point so I don’t think we need a resolution. The implementation will come later during the budget and the CIP.

This will come back as an action item in a couple of weeks.

Meeting adjourned.