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2023-08-22 Regular MeetingEDMONDS CITY COUNCIL MEETING APPROVED MINUTES August 22, 2023 ELECTED OFFICIALS PRESENT Mike Nelson, Mayor Neil Tibbott, Council President Vivian Olson, Councilmember Will Chen, Councilmember Diane Buckshnis, Councilmember Susan Paine, Councilmember Dave Teitzel, Councilmember Jenna Nand, Councilmember 1. CALL TO ORDER/FLAG SALUTE STAFF PRESENT Oscar Antillon, Public Works Director Angie Feser, Parks, Rec., & Human Serv. Dir. Susan McLaughlin, Planning & Dev. Dir. Todd Tatum, Comm./Culture/Econ. Dev. Dir. Rob English, City Engineer Jerry Shuster, Stormwater Engineer Jeff Taraday, City Attorney Scott Passey, City Clerk Jerrie Bevington, Camera Operator The Edmonds City Council meeting was called to order at 7 p.m. by Mayor Nelson in the Council Chambers, 250 5t' Avenue North, Edmonds, and virtually. The meeting was opened with the flag salute. 2. LAND ACKNOWLEDGEMENT Councilmember Nand read the City Council Land Acknowledge Statement: "We acknowledge the original inhabitants of this place, the Sdohobsh (Snohomish) people and their successors the Tulalip Tribes, who since time immemorial have hunted, fished, gathered, and taken care of these lands. We respect their sovereignty, their right to self-determination, and we honor their sacred spiritual connection with the land and water." 3. ROLL CALL City Clerk Scott Passey called the roll. All elected officials were present. 4. PRESENTATIONS 1. RESOLUTION THANKING ECA EXECUTIVE DIRECTOR JOE MCIALWAIN Councilmember Paine read a resolution of the city council commending Joe McIalwain for his expert guidance of the Edmonds Center for the Arts to be recognized as a cultural and economic cornerstone for the City of Edmonds, and that his presence here will be greatly missed. Joe McIalwain, Executive Director, Edmonds Center for the Arts, thanked the City, including all the incarnations of the city council, city staff, and mayors. It has been a joy to serve the community. He thanked the community for rallying the troops to support the ECA through some pretty challenging times, especially in its early stages. He was proud of what the ECA has become and he hoped the community was as well and was excited for what its future holds. He encouraged the City to continue to be a great Edmonds City Council Approved Minutes August 22, 2023 Page 1 partner to the Edmonds Public Facilities District and look ahead to what's possible and celebrate the organization that brings economic development and quality of life to the community. He encouraged the City to support those who will steward the ECA moving forward and thanked the community for the incredible opportunity to serve. 5. APPROVAL OF AGENDA COUNCILMEMBER TEITZEL MOVED, SECONDED BY COUNCILMEMBER PAINE, TO APPROVE THE AGENDA IN ORDER AND CONTENT. COUNCIL PRESIDENT TIBBOTT MOVED, SECONDED BY COUNCILMEMBER PAINE, TO REMOVE COUNCIL BUSINESS ITEM 9.1, REPORT ON CITY FUND BALANCE RESERVE & CONTINGENCY RESERVE BALANCE, FROM THE AGENDA FOR A FUTURE DATE. AMENDMENT CARRIED UNANIMOUSLY. MOTION CARRIED UNANIMOUSLY. 6. AUDIENCE COMMENTS Mayor Nelson described the procedures for audience comments. Carl Zapora, Edmonds, asked the city council, mayoral leadership and administration to take a serious look at City spending. A deficit of $1OM- 15M is currently projected and the council will receive updates on the numbers in the near future. A deficit of any kind, especially that large, means reserves are being depleted, putting the City in a very precarious position. The only way to reverse a deficit is, 1) reduce spending, or 2) raise taxes, neither of which are popular solutions but need to be taken into account when facing a serious deficit. He encouraged the city council and the mayor to focus on basics and not spend money where it is not needed. Basics include road and sidewalks, municipal services such as water and sewer, etc. The Burlington Factory project, estimated to cost $30M, was an expenditure he did not think should be entertained or approved when the City was running a deficit. He questioned what reductions would be necessary if the council committed to $30M. Reducing other expenditures will mean reduced services and reduced staffing, not fixing sidewalks or roads, etc. which he did not think were good solutions. The City purchasing the Burlington Factory property takes it off the tax rolls which further challenges the City's finances. He urged the council not to approve any further expenditures for the Burlington Factory property as the City cannot afford it and will put the City in a bigger and deeper financial hole, something he did not want any future council or City administrators to wrestle with. Phil Lovell, Edmonds, spoke regarding the need for public input, further investigation and consideration of the co -called landmark property on Highway 99 at the southeast corner of Edmonds. He recommended the City, by whatever appropriate process, abandon the potential purchase of this property. The City and its taxpayers cannot afford the purchase of this property for the following reasons, 1) there are much higher priorities and expenditures ahead including roadway infrastructure improvements, sidewalks and parking capacity, issues, Unocal property and ongoing work at the Edmonds Marsh and the City is still paying for the new Civic Park, and 2) the current described investigative procedure for purchase of the property seems flawed. Assuming Edmonds pays a professional consultant to conduct the staff - recommended study; if the study supports purchase of the property and the City proceeds, taxpayers support will be still be necessary plus $37M will need to be raised and appropriated to purchase the property. The council will likely feel pressured to purchase the property to get their money's worth from the proposed costly study. If the study recommends against the purchase, the council will most likely cancel or postpone the potential purchase regardless of input from taxpayers who currently seem to opposed the purchase, and the consultant fee will be wasted. If the study remains neutral regarding the Edmonds City Council Approved Minutes August 22, 2023 Page 2 potential purchase, the council will likely cancel or at least postpone and the related consultant costs will have been wasted. The taxpayers will likely oppose the purchase regardless of the study. Paul Hutchins, a carpenter and a member of carpenters' union, referred to the Landmark Budget Request, and suggested if the council decided to proceed, first, a project could be built by community members who spend money in the community. That can be accomplished by having responsible contractors who pay their workers what they are owed and with the inclusion of responsible bidding language into a community workforce agreement. Second, when the project is developed and matured, there will be another parcel that produces property taxes. Progress comes in all forms; the biggest progress is when it is time to build, building with responsible contractors and skilled carpenters and build something that becomes a community asset. If the council decides to move forward and spend the requested $200,000, ensure it is built with good labor, responsible labor and responsible contractors to ensure the City gets the bang for their buck. Matthew Curvink, a representative of the carpenters' union which represents 12 states and 90,000 members including 13,000 in the Puget Sound area, echoed Mr. Hutchins' comments. He added the council would be creating work for their own constituents. They appreciate such development and are hungry for work in their members backyards. Kevin Harris, Edmonds, Vice Chair of the Economic Development Commission (EDC), hoped the council could reach a compromise to move forward in the short term to explore clarity around the potential of the Landmark property. If it pencils out financially, he recommended exploration that demonstrates three things, 1) a clear benefit to the Gateway/Ballinger neighborhood and all Edmonds residents, 2) a clear and understandable cost benefit analysis, and 3) a clear identification of the different options and risks. The two EDC participants on the advisory commission will ask the hard questions regarding master planning and financing, avoid group think and bias and will apply financial sense to the process so the City's modeling is presented in a plainspoken way that still conveys the complicated nature of the issues. He appreciated recent public comment regarding the hope that the EDC can do it all, but they do not have the experience to supplant experts with multijurisdictional expertise and complex financing combinations and modeling including possibly tax incentive financing, a variety of public - private partnership opportunity options, new market tax credits, and other possible financing options. The EDC members can ask the tough questions and participate in process improvements, but they cannot initiate experienced modeling based on past similar project experience; there are people with that expertise and he believed they should be relied on. He thanked the council for listening and the meeting time they shared during the past month. Kevin Fagerstrom, Edmonds, relayed he attended last week's EDC tour of the neighborhood. He thanked the EDC for the excellent job they did, in particular Natalie Seitz who was very well prepared and made a great presentation to the group. At the conclusion of the tour and discussions regarding the Landmark property, he sees nothing compelling that leads him to believe the City should be involved in the purchase of the property anymore than the City should be involved in the purchase of any parcel for development by a private party. If a development is to move forward, and should because the property is underutilized and should be renovated with something new and beneficial, the City does not need to purchase the property for that private development. He was troubled by the $250,000 request from ARPA funds; in reviewing information related to ARPA funds, there is a cautionary statement on the Department of Commerce's website that care should be taken to avoid creating new programs or add-ons to existing programs that require ongoing financial commitments. The City is already putting $100,000 as a deposit to hold the property; now the council is being asked to invest $250,000 to fund a study, followed by $1M in earnest money for the purchase, and ultimately $37M to purchase the property plus likely $5-6M in demolition and remediation costs. This strikes him as an ill-advised use of ARPA funds and he suggested the council deny the request for use of ARPA funds. Edmonds City Council Approved Minutes August 22, 2023 Page 3 Bill Derry, Edmonds, said he was glad the Storm and Surface Water Comprehensive Plan Update was happening. City budgets should be transparent; the stormwater utility funds are primarily used to subsidize cars and car habitat, basic street maintenance including street sweeping, catch basin maintenance, pipe maintenance, etc. Streets and parking make up 80% of the impervious surface in the City and are the primary source of peak flows and air and water quality pollutants, but they do not pay into the stormwater utility. The street sweepers used by the City do not do anything meaningful for water quality; they only remove debris to keep catch basins clean and roadway surfaces clear and looking nice. Pollutants are attached to fine particles which are not picked up by street sweepers and street sweepers do not pick up oil. Funding for street sweepers, catch basin cleaning, and pipe maintenance should come from the street fund so people demanding the service, car owners/users, are paying for the service. If street maintenance activities were funded from street funds, the stormwater utility would have funds to complete necessary storm and surface water projects like addressing blockages to salmon in streams. Since most blockages are caused by street culverts, replacements should be funded from street funds. The City has done very little to retrofit streets for treatment or stormwater detention. The Storm and Surface Water Comprehensive Plan should include significant projects to retrofit streets for stormwater treatment and detention using street funds. The City should fund an aggressive program with Green Streets to infiltrate stormwater and treat stormwater runoff. The diversion structure at the mouth of Perrinville Creek should be removed and a salmon -passable bridge under the railroad installed, and log structures installed up stream to stabilize and reduce erosion which would reduce sediment in lower parts of the stream. If additional funding were available, flooding on Dayton, caused by overflow from the marsh, could be addressed. He disagreed with the statement that stormwater funds cannot be used to complete projects on private property; they can, the City has done this before with permission from the property owners. When thinking about future land purchases, he urged the council to think 20-50 years ahead. Brian Kelly, a union carpenter with Local 206, spoke regarding the use of union labor and apprentices in particular. Not long ago, he was homeless, penniless, and hopeless without a skill of any worth, wandering around Seattle going between random cook jobs and whatever way he would make money, not really being productive and more of a burden. He found his way into the union, working as a contractor at the time for Comcast and superintendent for a company in downtown Seattle noticed his work and offered him a chance and he joined and was a member within a year. A year later, he is making money and has a home to live in, money to buy food, etc. Three years later, as a fourth year apprentice, he feels like a productive citizen, he goes to stores, spends money, etc. The union does this for many people, helping people move from living on the streets to spending money in the economy. Thatcher Boddendeitchel, Edmonds, a member of Carpenters Local 206, echoed the comments of his union brothers, commenting what they said was a huge part of why he joined the union. He commutes out of Edmonds daily, passing multiple non -union job sites, to participate in other cities' economies, not the economy in which he lives. He wants to benefit the community he lives in, the pride from driving past a job he has worked on is immense, a project that lasts for 50-100 years. The reason union labor makes a difference is because it is skilled and it lasts and makes an impact on the community. He urged the council, whatever developments they decide to move forward with, to consider using union labor. It makes a difference in the City and in the lives of union members' who build things. Eric Nelson, Edmonds, added his support to the statements made in opposition to the Landmark property acquisition. He was dumbfounded when he first heard the council was considering this purchase; the City is not a developer, it is not part of the City's charter and not why councilmembers and the mayor were elected. The City's role is not to purchase private land and figure out a way to use it. He strongly recommended this process be stopped and not spend the $250,000 in ARPA funds, which he did not believe were intended to be used in a way that does not benefit citizens which was the idea behind those funds. He summarized he was against the Landmark property purchase in every way possible. Edmonds City Council Approved Minutes August 22, 2023 Page 4 Greg Brewer, Edmonds, said the 10-acre Landmark property is intriguing, however, spending $250,000 for a consultant to tell the council it cannot afford the $38M purchase price is crazy. The structures on the property will be nearly impossible to repurpose and likely will need to be demolished which puts City staff in a developer role. He referred to two large projects the City has undertaken in the past few years; Civic Park: the City received the property for next to nothing, planned for a $8M build and ultimately paid close to double that amount to finish the project. It is a nice park, but things come up and so did the price. Edmonds sewage treatment plant: in an effort to have the latest and greatest green technology, a completely viable incinerator that had plenty of capacity for the future was decommissioned. The new system doesn't work and the City is shipping sludge to Oregon. So much for a reduced carbon footprint. He questioned how much it would cost to fix the sewage treatment plant and when will it be fixed. That should be the City's number one priority. Good intentions can backfire and cost additional money, money Edmonds does not necessarily have. It is widely apparent the City does not have the bandwidth for this scale of project and staff s plate is already full. He recommended fixing up what the City has first, fill the coffers and swing for the fences another day. 7. RECEIVED FOR FILING 1. CLAIM FOR DAMAGES FOR FILING 2. WRITTEN PUBLIC COMMENTS 3. OUTSIDE BOARDS AND COMMITTEE REPORTS 8. APPROVAL OF CONSENT AGENDA ITEMS COUNCILMEMBER TEITZEL MOVED, SECONDED BY COUNCILMEMBER PAINE, TO APPROVE THE CONSENT AGENDA. MOTION CARRIED UNANIMOUSLY. The agenda items approved are as follows: 1. APPROVAL OF SPECIAL MEETING MINUTES AUGUST 15, 2023 2. APPROVAL OF REGULAR MEETING MINUTES AUGUST 15, 2023 3. APPROVAL OF PAYROLL AND BENEFIT CHECKS, DIRECT DEPOSIT AND WIRE PAYMENTS 4. APPROVAL OF CLAIM CHECKS AND WIRE PAYMENT 5. RESOLUTION THANKING ECA EXECUTIVE DIRECTOR JOE MCIALWAIN 9. COUNCIL BUSINESS 1. STORM AND SURFACE WATER COMPREHENSIVE PLAN UPDATE Stormwater Engineer Jerry Shuster reviewed: • What is the Storm & Surface Water Comprehensive Plan (SCP)? o High level ■ Aspirational Plan - Sets the direction for managing storm and surface water in the City ■ Operations & Maintenance Plan ■ Asset Management Plan ■ Regulatory Compliance Plan - Primarily driven by requirements of Department of Ecology Municipal Permit that permits the City to discharge stormwaters into receiving certain conditions - Permit scheduled to expire in 2024, replaced by a new permit with requirements ■ Capital Improvement Plan Stormwater waters under additional Edmonds City Council Approved Minutes August 22, 2023 Page 5 - Larger projects to upgrade and improve the City's storm system and comply with regulations ■ Financial Plan ■ Equity Plan o How does the SCP fit with the City's Comprehensive Plan Eles Water Sanitary Sewer Seerm Q Surhn 1Ahlar Solid Waste Other Utilities o ECC Chapter 7.50 - Stormwater Management Utility ■ "The utility will have primary authority and responsibility for carrying out the city's comprehensive drainage and storm sewer plan, including responsibilities for planning, design, construction, maintenance, administration, and operation of all city storm and surface water facilities, as well as establishing standards for design, construction, and maintenance of improvements on private property where these may affect storm and surface water management. o Stormwater Utility builds, operates, & maintains the City's Stormwater Management System: ■ Pipe & other conveyances ■ Roads/Streets/Curb & gutters/Culverts ■ Catch basins ■ Flow control & treatment systems o Not part of Stormwater Utility: ■ Streams, Lakes, Wetlands, Puget Sound - These are "Receiving Waters" or "Waters of the State" o Building Blocks of SCP Edmonds City Council Approved Minutes August 22, 2023 Page 6 Why do we need to update our current plan? o Adopted in 2010 as a 6-year plan o Regulations are changing; we need a plan to remain in compliancc o Climate is changing — adapt o Growth is happening o Attitudes change, need to be in sync with stakeholders o Internal stakeholders ■ Edmonds property owners (rate payers)/residents ■ Edmonds business owners ■ City Council ■ Edmonds Developers ■ Interested Community Groups (Save our Marsh, Stream Team, others) ■ Other City Departments (Planning & Parks) o External stakeholders? ■ Dept of Ecology/Commerce (WA) ■ Department of Fish & Wildlife (WA) ■ Tribes (Tulalip, Snoqualmie) ■ Washington Dept. of Transportation ■ Port of Edmonds ■ City of Shoreline — Lake Ballinger ■ City of Mountlake Terrace - Lake Ballinger/ Forum ■ City of Lynnwood — Lake Ballinger & they send us runoff (Perrinville Creek) ■ Town of Woodway ■ Olympic View W&S What are the steps involved in updating the SCP? 1. Phase I (scheduled to be completed by end of 2023) A. Review current practices — How are we currently spending Stormwater Fund dollars? B. Assess need for flood reduction capital projects C. Develop goals & policies for each building block 2. Phase II A. Develop draft SCP w/financial plan B. State Environmental Policy Act (SEPA) process C. Finalize the SCP/financial plan Edmonds City Council Approved Minutes August 22, 2023 Page 7 D. Incorporate stakeholder input on all steps Phase II A: Develop Draft SCP w/financial plan: ■ Programs - Residential Rain Garden Program - Streamside Property Owner Assistance Program - Expanding inspections of private stormwater systems ■ Maintenance Practices - Increased street sweeping - Additional pipe cleaning ■ Capital Projects - Flood Reduction - More Stormwater Retrofits (quantity & quality) - Regional Facilities - Annual Pipeline Replacement and Repair Program ■ Potential Code Changes - Land Use - Impervious Surface Limits - Stormwater - Critical areas o Stakeholder Engagement for All Steps ■ Initial Community Engagement (August -December 2023) - Survey for stakeholder input in Developing Goal & Policies - Stakeholder Workshop 1 (virtual) - Community Event (in -person) - TBD - Council presentation of Draft Goals & Polices (4Q 2023) ■ Additional Stakeholder Engagement - Draft SCP (2Q 2024) - Stakeholder Workshop 2 (virtual) - SEPA review (comment period) - Council Public Hearing on final SCP o High level timeline 2024 Edmonds City Council Approved Minutes August 22, 2023 Page 8 Councilmember Buckshnis welcomed Mr. Shuster back to Edmonds. She referred to Bill Derry's comments, whether the street fund should pay for street sweeping and other activities related to streets. City Engineer Rob English responded streets and stormwater pay for maintenance and operations costs. There are obviously competing needs for funding; there is not enough funding to maintain streets and perform overlays so the asset continues to degrade. Staff tries the best they can related to stormwater by investing in retrofits and capital projects and allocate funding sources to maintain street infrastructure. There is not a crisp answer to whether street sweeping should be completely a streets function as there is definitely a stormwater component. Keeping streets clean prevents debris from entering the catch basins and the pipe system which is all stormwater infrastructure. There is obviously a need for stormwater funding to pay for that. Public Works Director Oscar Antillon relayed what Bill Derry said is true; it is hard to fund a stormwater system, but he disagreed with some of his comments, street sweeping serves the purpose of keeping the stormwater system operational and functioning as it is supposed to. The stormwater program is one of the biggest things related to resilience; he referenced the storm in California that has had a huge impact on the community. The intent is to be fair with the use of funds as well as keep rates low. There is no appetite for increasing rates so it is a competing demand all the time. As Mr. English mentioned, street funds are pretty limited. A large amount is subsidized by the General Fund which is a competing interest. Councilmember Buckshnis commented the increased license tab fee will provide an additional $700,000 for streets. She supported having a robust stormwater code and was confident that will happen with Mr. Shuster leading the charge. Councilmember Buckshnis commented on the need to get rid of piped culverts sooner rather than later and federal infrastructure funds available for that purpose. She asked if the SCP will address removing culverts, noting design of Perrinville Creek is on the CIP/CFP. Mr. Shuster answered it could be included in the plan, but the cost would need to be determined as well as assumptions about the funding source. Before returning to Edmonds, he worked in Bellevue where a few large culverts were replaced at a cost of $2M-6M each. He agreed it was a good thing to do in anticipation of stream restoration and WDFW has assessed culverts throughout the Puget Sound including in Edmonds and few culverts in Edmonds could use some help. If during the survey and public meetings the public is interested in that, it could be included in the plan. Councilmember Buckshnis said Perrinville is in dire straits, not just stormwater culverts but also the railroad trestle. Senator Cantwell supported $3.5M for the Meadowdale Beach railroad trestle which indicates federal funding is available. Councilmember Paine asked about the NPDES permit standards for Edmonds. Mr. Shuster answered the draft standards just came out from Ecology last Friday. As with any permit cycle, the regulations will get more strict. For example, tire dust containing 6PPDQ is highly toxic to marine life. The permit will require stormwater treatment at a lower threshold for roads. For example if the City is widening a road, more stormwater treatment will be required. He did not know details other than they never make things easier. Edmonds City Council Approved Minutes August 22, 2023 Page 9 Councilmember Paine asked about the storm event horizon, whether it was 50 year or 100 years. Mr. Shuster said he has seen estimates all over the board from storms will get 20-50% more intense. He suggested keeping an eye on what larger jurisdictions are doing; for example King and Snohomish Counties are investing a lot of money to study the impacts of climate change on stormwater. Councilmember Paine asked if that will be included in the planning and ultimately in the document. Mr. Shuster answered yes. Councilmember Paine asked if the SCP will include stormwater treatment though green streets and rain gardens which are very popular and efficient at managing stormwater. Mr. Shuster answered yes. Councilmember Paine noted green streets and rain gardens are different than detention ponds, smaller and more localized. Mr. Shuster answered the current regulations for private development encourage the use of rain gardens versus gray infrastructure. The City is following Ecology regulations and those regulations have not been very effective. He reviews a lot of development permits and does not see a lot of rain gardens. He anticipated the next iteration of the permit will make it easier for those to happen. Every year Edmonds works with Snohomish County Conservation District to install rain gardens around the City and he hoped to expand that program. Councilmember Paine asked if there was an opportunity for sharing the cost of green streets with stormwater infrastructure dollars. Mr. English said stormwater utility funds could be used for green streets, at least the aspect related to the actual rain garden or treatment system built with a project. If that includes sidewalks or street widening, the City has to be careful how those funds are used and stormwater is probably not the right source for those improvements. Councilmember Paine commented there are particular watersheds that are most vulnerable and sensitive. Councilmember Nand thanked Mr. Shuster for highlighting climate adaptability and environmental impacts in the SCP. She asked the status of runoff into Puget Sound and Lake Ballinger and how it contributes to toxic algae bloom and would this plan and the proposed fixes help remove the pollutants causing that ecological imbalance. Mr. Shuster answered the toxic algae bloom in Lake Ballinger has been happening as long as he can remember and is a byproduct of people using fertilizers and other nutrients that wash into the street and into the lake. The permit includes education and outreach about proper use of fertilizers so that doesn't happen. Stormwater retrofits can install treatment units in the right-of-way to treat those nutrients before they enter the lake which will ultimately help that situation. It's better not to have it enter stormwater in the first place via source control, versus expensive treatment systems. Councilmember Nand agreed the more education that can be done the better and offered to assist. Councilmember Teitzel referred to slide 7 in the packet that states streams, lakes, wetlands and Puget Sound are not part of the Stormwater Utility, but slide 8 clarifies they are part of the utility if they are on City -owned property. Mr. Shuster answered they are not part of the stormwater utility according to the permit. If Shell Creek goes through Yost Park, the City owns the area around the stream. Councilmember Teitzel commented Shell Creek is his favorite steam and asked if the City wanted to do improvements to the stream within Yost Park including realignment of the stream, would that fall within Public Works' responsibility. Mr. Shuster answered he would think so or Parks. Mr. English advised it likely would be a combination of Public Works and Parks, but a permit from the state is still required to do improvements because it is a water of the state. Councilmember Teitzel referred to code changes related to impervious surface limits. He referenced housing bills passed by the legislature during the recent session that will allow duplexes and fourplexes and detached ADUs which could be as large as the main house and asked if there would be conflicts between impervious surface limits and new state laws to increase density. Mr. Shuster answered that is a Edmonds City Council Approved Minutes August 22, 2023 Page 10 difficult question because the GMA was supposed to protect outlying areas and encourage density in urban areas in an effort to help the environment. If urban areas density, theoretically there is less suburban spawl, tree removal, etc. Allowing denser development is challenging for stormwater because rain gardens and other natural stormwater infrastructure require space which creates a conflict. In more dense development, developers are putting in standard detention vaults under building which works, but it is not great thus the conflict between densification and stormwater. Councilmember Chen said the budget amendment to Street Fund I I I projects a deficit by the end of the year, coupled with past experience with winter flooding and excessive weather pattern changes, very hot days which indicate severe storms in the winter. He noted the $700,000 from increased car tab fees will help, but asked about plans for mitigating flooding in the future. Mr. Antillon answered there are multiple issues; for example flooding on Dayton, until the final disposition of the marsh is determined, that flooding will be difficult to control. The City already spent a great deal on the pump system, but one storm can render that system ineffective and results in pumping out the bay which cannot be done. He liked to think of the plan as a roadmap of priorities; it identifies high risk areas and identifies funds to address those projects. Staff always tries to maximize limited funds for every project. For example, the pavement preservation program is combined with overlays for utility projects. Mr. Shuster answered climate change is a real challenge because like most cities, Edmonds installed its stormwater infrastructure in 1960-1990 when storms were smaller and less frequent. To dig up all the pipes and install larger pipes is impossible so the intent is to focus on and prioritize certain areas. Councilmember Buckshnis complimented the City's engineers, noting the Dayton Street pump station was working for five years, but it was overwhelmed by flooding from geomorphic events caused by climate change; Mother Nature always wins. She asked if the Dayton Street pump station could be retrofitted to address larger events. Mr. English answered additional capacity could be built at the pump station, but there are other components to making that whole area work properly. As Mr. Shuster noted, sea level rise needs to be considered in the future. He summarized it is a complex situation that will require a complex solution and just building more capacity may not be the right solution. Councilmember Buckshnis commented removing the fences and daylighting Shellabarger Creek has helped with flooding. There was flooding during two major events but nothing like what has occurred in the past when residents submitted claims related to flooding. She asked about the SEPA process related to the SCP. Mr. Shuster answered the draft SCP will go through a SEPA process. Councilmember Buckshnis referred to stormwater on private property, noting there is a barrier in the mid - reach of Shell Creek on private property which could be stormwater related. She asked if the City could approach the homeowner if a design was developed and funding identified. Mr. Shuster answered private property is a sticky question because you have to be careful about a gift of public funds. Whenever the City does a project, consideration is given to who benefits, whether it is the property owner, Edmonds citizens, or fish. It is a question of priorities with limited stormwater funds, whether that property is a higher priority than retrofitting Perrinville Creek. 2. LANDMARK BUDGET REQUEST Parks, Recreation and Human Services Director Angie Feser explained the City has a unique opportunity to create a transformative development through the Landmark 99 project. By focusing on an area historically in need of large capital investments, this project aims to fill community desires and needs derived from thoughtful engagement and collaboration. With this prime location and versatile land, this project holds immense potential for mixed use development, enhancing Edmonds' character and improving quality of life for all residents. This evening staff is requesting council consideration of a budget allocation to authorize the mayor and staff to procure various consultant services which would Edmonds City Council Approved Minutes August 22, 2023 Page 11 provide data and facts necessary for council to make an informed decision regarding the upcoming option agreement amendment to formalize the upcoming purchase and sale agreement. She reviewed: • Property information o Address: 24111 Highway 99 ■ Currently occupied by Burlington Factory o Size: 10.06 acres o Tax lots: 11 o Zoned: GC - General Commercial o Purchase Price: $37M o Highlights ■ 2021 - initial 3-acre open space/park ■ One owner, willing to sell ■ No significant critical areas ■ Utilities in streets north and south ■ Public and non -motorized transportation access ■ Burlington Factory lease (January 2029) Planning & Development Director Susan McLaughlin commented she has been before the council on numerous occasions regarding various issues on Highway 99. She has been with the City for 1'/z years, but there have been decades of planning done related to Highway 99. She reviewed: • Plans & Commitments o A sampling of relevant Hwy 99 Sub Area Plan Planned Action EIS mitigation measures: ■ Encourage and promote public open spaces through public/private partnerships where possible. ■ Implement pedestrian and bicycle transportation improvements to provide greater access ■ Acquiring park land in the Highway 99/SR 104 areas to provide adequate park service in redeveloping areas. ■ Create new civic spaces to enhance investment and revitalization while meeting recreation needs ■ Increasing connections to the Interurban Trail, using signage, sidewalks, curb extensions, and other pedestrian/bicycle enhancements ■ 2017 Highway 99 Subarea Plan - "...the Edmonds community expressed a strong desire for a gateway ... A district transition point in and out of Edmonds" ■ 2022 PROS Plan Recommendations/Action Initiatives - "Acquire property for neighborhood parks in underserved areas, such as the south Edmonds area and the SR99 corridor." - "Explore options for acquiring property to create a satellite community center in the Lake Ballinger or South Edmonds area." Council Budget Priorities o Police Presence - Eastside ■ Property has the potential to house a police substation o Neighborhood Commercial/Walkable/Beautification ■ Property coupled with CRA and TIF tools has the ability to transform southern gateway o Transparency of projections/enhance trust ■ Master plan will be a very public process; community will help develop o Human services/homelessness/senior citizen services ■ Property has the potential to house a myriad community support services Economies of Scale Edmonds City Council Approved Minutes August 22, 2023 Page 12 o Opportunity Statement: Deliver community needs and honor previous commitments through partnerships that will optimize our outcomes in a cost effective, time efficient and innovative way o How long would it take to deliver these community facilities independent of each other? ■ Community Center ■ Park/Open Space ■ Police/Fire ■ Library ■ Recreation Center ■ Extensive Transportation Infrastructure k 66#* ki Purchase Land Plan/Permit Site Mobilize Labor Procure Materials Occupancy Community/Culture/Economic Development Director Todd Tatum explained there are many examples in the area of cities doing this well including Redmond, Bothell, Kirkland, Woodinville, Tukwila, Port of Vancouver, and Puyallup. He reviewed: 0 Case Study — Woodinville o Public -Private Partnership o City -led initiation on City -owned land o Included developing a development strategy, vision for the site, conducting an RFP and selecting a partner o Innovative use of space ■ 5 acre property ■ 264 unit mixed use ■ 40,000 square feet of retail ■ 400 parking spaces for visitors and residents ■ Space for YMCA ■ City retained ownership of several walkways and plazas developed by developer N ® HE 175TH ST o • -W- SCHOOLHOUSEDISTRICT o ' _ g Z - 1 - Grand Lawn — 2 - Woodinville Steps 3 Festival Street V O a - Schoolhouse Stroll N 5 - Schoolyard irwcwF.tr.. Pf�9^"^1i 6 - Teacher's Pet Park p IDo 11B 7 Interactive Forest o 8 - Residential Courtyard CITY HALL Edmonds City Council Approved Minutes August 22, 2023 Page 13 Case Study — Tukwila Village o Area associated with crime, overlooked by developers, and lacked quality housing options o Public -Private Partnerships o City -led initiation o Expansion of public space o Urban Renewal and Revitalization Plan o Overall investment ■ $10M from King Library who constructed a library ■ $7M from City of Tukwila for property acquisition and street frontage improvements ■ $ 1 M from Washington State Transportation Improvement Board ■ $113M in developer financing including $20M in low income housing tax credits o Formed Tukwila Village Community Development Association whose mission is to improve the social welfare of the public in Tukwila and the residents of Tukwila Village by promoting arts, economic development, education, health and community building. Mr. Tatum commented the timeline is admittedly relative short. The option timeline is shorter than some other cities which he acknowledged creates stress. Any project includes a triple constraint: scope, schedule and budget. The property answers years of questions, but the project needs support. To the question of whether this project is staff and administration asking the council to approve $37M purchase and $130M construction costs, the answer is no. This project is designed to give the City the best chance of attracting the best partners and lowering the total cost of ownership and development for the City while also maximizing the amount of public space the City gets via this project. The funding request will provide answers to inform council's work and to make sound, strategic decisions. The intent is strategy and not tactics which is what this budget request is about. Mr. Tatum continued, staff s intent is to lead a public process based on the best information available, think about and offer opinions on the financial and strategic risks and not get buried in the weeds of private low income tax credits when the City can pay a reasonable cost for the answers as they pertain to this property. This funding request answers the community's questions about the property. It reduces the risk of making a poor choice in acquiring this property, but also in making a poor choice in not acquiring the property if there is a real chance of making it work for a reasonable cost. This funding maximizes the likelihood that a partner will express interest. It is not a waste of money; the conversations with the community about the real prospect of City investment on Highway 99 will be invaluable in determining future work. It is real, tangible and these conversations can continue even if the project fails. He reviewed: • High Level Work Plan Edmonds City Council Approved Minutes August 22, 2023 Page 14 V41) oar W." sd•or (Muter A•a+g A FRFPia NegW "the Purdue and sale agreement Budget Need Categories o Due Diligence — $60k o Master Planning — $75k o Development Strategy — $95k o Project Communications — $20k Budget Request Expenditure Increase (Decrease) 001.000.3 3 3.21.019.00 001.000.61.557,20.41.00 Alter llative Fro svdm Coronavirus Relief Fund (Green $(250,000) Infrastructure, specifically Green Streets) Professional Services $150,000 from Green Streets $100,000 from city-wide Professional Services sweep $ 250,000 With regard to the applicability of using ARPA funds, Mr. Tatum answered $1.4M has been allocated in City expenditures from ARPA and about $700,000 has been spent. This is not a novel use of those funds. A number of sources address guiding principles for use of ARPA funds; investments in critical infrastructure are particularly well suited to ARPA because it helps the community and furthers residents' well-being. He relayed: • Staff Recommendation o Approve the request to allocate $250,000 to the Landmark 99 project account Councilmember Teitzel thanked Ms. Feser, Ms. McLaughlin and Mr. Tatum for their well thought, through presentation and he applauded them for thinking big. COUNCILMEMBER TEITZEL MOVED, SECONDED BY COUNCILMEMBER BUCKSHNIS, TO DISCONTINUE PURSUIT OF THE PURCHASE OF THE BURLINGTON FACTORY PROPERTY AND REQUEST A REFUND OF THE $100,000 DEPOSIT. Councilmember Teitzel read the following statement: I'm appealing tonight to my fellow Councilmembers who are fiscal conservatives to discontinue pursuit of the purchase of the Burlington Coat Factory property. We are currently in the budgetary danger zone, with expenses far outstripping city revenues. That trend is simply not sustainable. We absolutely must get our financial house in order and focus squarely on delivering the key services our constituents expect. In other words, we need to get back to the basics and doing them well. Edmonds City Council Approved Minutes August 22, 2023 Page 15 On June 27, I was the swing vote in approval for the Administration to proceed with placing a $100,000 fully refundable deposit toward potential purchase of the Burlington property, with the understanding that deposit would be returned to the city within six months should Council decide during that time not to pursue the purchase. I cast my vote with the understanding staff had the expertise and bandwidth to further vet the details of the potential purchase to provide Council with the information it needs to make the go/no go decision within the six month window. In that case, the financial risk to the city would be minimal since the only financial obligation was characterized as being the refundable $100,000 deposit. To reinforce my understanding, I carefully reviewed the June 27 Council meeting minutes, and confirmed that nowhere during that discussion did Staff mention the need to hire an expensive consultant to develop the needed information. Had that information been made known on June 27, 1 would not have voted yes and the motion to proceed would have failed that evening. I now firmly believe the financial risks to the city of the potential purchase of this property exceed the rewards. Following are several concerns about this potential purchase: 1) The $37m purchase price has been negotiated between the seller and the city and appears relatively firm unless any unforeseen encumbrances or environmental issues are uncovered during the first six months. The price was supported by a market appraisal at a cost to the city of approximately $14,000. However, the appraisal assumed a "highest and best" use of the property, which assumes it would be sold on the open market without any restrictions. The appraisal did not consider the sale would include a restriction imposed by the seller of 75/25, whereby only 25% of the property could be developed for unrestricted use while 75% must be reserved for public purposes. While the seller is apparently now willing to negotiate the percentage split after hearing concerns expressed by Council, it was mentioned in the June 27 minutes that he was asked to consider a 50150 split and he rejected that notion. So, it is clear there will continue to be a significant restriction of something in excess of 50150 in the terms of sale. 2) I have discussed the potential purchase with an expert in commercial real estate, and was advised the city should be extremely cautious since the commercial real estate market is showing signs of a significant downturn. Interest rates are up sharply making commercial real estate loans more costly. And demand for commercial properties is down. There is a very real risk the $37m asking price is not supported by market conditions, and the city should not overpay for a property with this risk in mind. 3) If the city abandons its pursuit of this purchase and the property is sold on the open market, the city stands to receive significant revenue from taxes and fees that would ease pressure to increase Edmonds property taxes. For example, the city has received approximately $500,000 in Park Impact Fees from the new Hazel Apartments project. Those fees go directly to park and open space acquisition/improvement. It can reasonably be assumed that mixed use development at the Burlington site would be far larger than the Hazel Apartments, and the city could expect to receive in excess of $lm in Park Impact Fees alone (which could be dedicated to acquiring park and open space in the Highway 99 subarea), in addition to significant property tax, sales tax and other fees from the property. 4) If the seller attempts to sell the property on the open market and finds willing buyers are not stepping forward due to the price level and sale conditions imposed, the city may be interested in reengaging with the seller about potential purchase of a portion of the property in partnership with a development entity. However, it now appears the seller is unwilling to sell parcels individually, and we are foregoing the potential to acquire a smaller parcel if we proceed now to the next phase of the purchase of the entire property —with much greater financial risk to the city. Over the past several weeks, my fellow Councilmembers and I have received a great volume of input from our constituents about this proposed purchase. The message is clear: the great majority have significant concerns about the great financial risk to our taxpayers. Instead of pursuing this purchase, our Edmonds City Council Approved Minutes August 22, 2023 Page 16 constituents are asking us to rededicate ourselves to the basics of city government and provide services they view as essential. I agree. Here are a few essential items expected by our citizens that Council and the Administration need to focus on over the next several years: 1) We must complete the Wastewater Treatment Plant project so the system is functioning as designed. This project is fundamental to our quality of life and our ability to absorb anticipated population growth throughout our city. 2) We must accelerate our sidewalk installation and repair program to enhance walkability and ADA compliance in Edmonds, paying particular attention to the Highway 99 subarea. 3) We must accelerate the installation of bicycle lanes to increase safe local bicycle usage and reduce vehicular trips, in support of the goals of our Climate Action Plan. 4) We must enhance police protection in the Highway 99 subarea, and establish a police substation on the corridor to create an active police presence to deter crime. An active police presence in the area would also enable more frequent patrols of the Interurban Trail to enhance the safety and enjoyment of that amenity by all. 5) We must establish a proactive roadside trash clean up and abandoned shopping cart retrieval plan for all sectors of Edmonds to keep our city clean and welcoming for residents and visitors. 6) We must establish plans to restore our watersheds and estuaries (including Perrinville Creek, Shell Creek, the Edmonds Marsh estuary, etc.) to support healthy salmon populations and enhance public enjoyment of these spaces. 7) Now that the appeals court has ruled in Edmonds' favor regarding the Ebb Tide walkway issue, the city needs to determine how best to proceed to complete the "missing link" in the waterfront walkway. 8) Our expenses for fire and emergency services are significant: approximately 10% of our overall city budget. And those expenses are rapidly increasing. We must determine how to continue to deliver high quality fire and EMS services to our citizens at the lowest possible cost. 9) We must continue to acquire park and open space —especially in areas of our city where such spaces are currently lacking. 10) The Edmonds Library roof has been leaking for decades and is in need of complete replacement, which will be more cost effective than for the city to continue to implement temporary patches. 11) We must complete the Edmonds Comprehensive Plan by the end of 2024, which will require significant city resources and will set the overall direction for the city for the next decade. These are just a few of the many items that will require significant budget support and are things our constituents clearly want. And these are all very important items that must be accomplished within the framework of our budget before we take on expensive, speculative projects. In other words, we need to bake the cake before we add the frosting. With all of this in mind, I urge my fellow fiscal conservatives to vote in favor of my motion to discontinue pursuit of the purchase of the Burlington Factory property and request prompt return of the $100,000 deposit. Councilmember Olson commented the council did not have a presentation on the City Fund Balance Reserve and Contingency Reserve Balance tonight which she felt was very relevant to this conversation. The correct number today is the City is $4M behind the anticipated budget. She has had concerns and was looking forward to vetting that with the finance director at tonight's meeting. In general, that conversation as well as the cost of fire/EMS does not give her the warm fuzzy about the City's finances that she would like to have going into something risky and expensive. She commended staff for their work to date and the presentation that covered all the bases and told the story about possibilities. The punchline is to come back with something affordable that council could buy off on. With what she knows and does not know about the City's current finances, she was concerned there would not be a good number. The CIP/CFP includes the library roof replacement with no funding source. With inflation and the escalation in staff Edmonds City Council Approved Minutes August 22, 2023 Page 17 costs over the last few years due to increasing staffing and salary increases, she was concerned the City will need to be tightening its belt, not expand and look for things that are really exciting, but not feasible right now. Councilmember Olson referred to the slide regarding plans and commitments, noting the 2022 PROS Plan was the first time a community center was mentioned and it is not in the CIP/CFP. The CIP/CFP is a very long list of prioritized capital projects and perhaps some changes will be made to the CIP/CFP this year. Staff is basically saying the council should be leapfrogging ideas that are talked about in front of projects that are already in the CIP/CFP. As Councilmember Teitzel mentioned, one of those projects is replacing the roof on a very large building, a very expensive project that has no funding identified and that is known to have mold in it. The roof has been mitigated to ensure a healthy environment inside the library, but with continued leaks that will change over time. She summarized this is absolutely not the right time. Councilmember Olson referred to a public comment by Ray Dimino that was included in the packet and that she read when the email was received, who said keep the main thing the main thing. This is not the main thing. Mr. Dimino appreciated changes he's seen over the last 15 years. His email listed several main things such as the wastewater treatment plant, potholes, enforcement, etc. where the City could be putting more time, attention, focus and money. Until those things are addressed, this might not be the right thing. Mr. Dimino also recommended having a plan to move forward. The City has a plan, the CIP/CFP. This funding request is for a project that is not on the CIP/CFP and the City cannot afford the six years' worth of projects already on the approved CIP/CFP, coupled with not being in a great financial situation. She spoke in favor of the motion, not because she wasn't excited; she would love to see this happen, but did not see after spending $250,000 that the council would have more money to put toward the project in the short term. Councilmember Nand said Councilmembers Teitzel and Olson and others who are more skeptical about this acquisition are very committed to the idea of bringing services to the Highway 99 corridor. The devil is in the details. There is a political discussion to be had; she is a business lawyer and looks at numbers and wants to know how things get done in a practical sense. She looked for comparable projects in Edmonds that could provide a template for how this development on Highway 99 would be pursued, a departure from development in that area. Currently the City's footprint in that area is Mathay Ballinger, the neighborhood city hall and the public works building. With regard to want versus need, she lives in the Highway 99 corridor and works in the Edmonds bowl which was incorporated in 1890. The name Brackett is seen a lot, a man many generations ago who had a vision for the area. In the Highway 99 area, names seen frequently are Ballinger and McAleer. Civic leaders' vision led to things like the Civic Center Playfield, the Edmonds Waterfront Center, the Boys & Girls Club, the Civic Park amphitheater, Hazel Miller Plaza, and Frances Anderson Center. Those are the result of multigenerational work that often started with the vision of 1-2 very powerful white men. When she looks at the magnitude of this project, she is not thinking how it will benefit today's taxpayers, she is looking at how it will benefit the community and region for generations to come. In counterargument to some of the arguments, Councilmember Nand said in researching the numbers, Civic Playfield was a $1.9M acquisition with state and county funds contributing a 50% match. The council approached the Snohomish County Council and the State with a vision for adding something to the community to benefit generations to come. A My Edmonds News article regarding the Edmonds Waterfront Center indicated the projected government contribution would be $6.5M out of the $16M, the remainder came from leadership of individuals, board fundraising, foundations and community campaigns. That incredible vision led to an incredible community asset that a large portion of the community can enjoy free. She toured the center with Washington State Supreme Court Justice Debra Stephens and saw a prenatal yoga class. There is nothing like that on Highway 99. For people on Highway 99, especially those from immigrant communities like her families, or blue collar people who do Edmonds City Council Approved Minutes August 22, 2023 Page 18 not own a car, east -west accessibly issues limit access to the resources in the Edmonds bowl. That is not the result of any nefarious plan, but is because the Edmonds bowl was incorporated in 1890 and there are multiple generations of vision and investment. Councilmember Nand commented the council talks a lot about equity and basic needs. Sidewalks are great, she grew up in the Highway 99 community without sidewalks on residential streets. Residents in the Highway 99 area would like a nice place to walk to or a place they would feel safe letting them walk alone. Her generation could go to Mathay Ballinger, Safeway on Highway 99, etc. People no longer feel safe and would like a police substation and an indoor community center especially during bad weather. She would personally like a library because many working class families with young families who do not own a car could benefit from amenities the public library system provides. This will take vision and investment, not toward what will happen today but what will happen in 30 years. She did not support the full $250,000 request, but supported funding due diligence and master planning. She summarized it would be an incredible mistake to walk away from this process right now. Councilmember Paine recognized staff for their hard work, noting this has been a topic of discussion in the community. She recognized that other councilmembers may receive emails from different people, but the comments she has received are close to 50150 rather than the majority being against funding this project. She echoed some of Councilmember Nand's comments; historically large amenity spaces have been acquired via the school district such as Frances Anderson Center, the Edmonds Center for the Arts, and Esperance Park which are former schools. There were no schools on the eastside of SR 99 or places for people to walk to in that great neighborhood. It is the City's duty to provide streets, streetlights, sidewalks, public safety, etc.; those are not amenities, those are the basics. Having an amenity in that neighborhood is crucial. She referenced community renewal, recognizing this will be multi -year and the horizon that should be considered is 50-100 years. This is a rare opportunity; she could not think of another 10-acre parcel that the City would have the opportunity to purchase. She did not support the motion and believed the project should be fully funded. If at the end of the project, when the information is available, then the council can bring all its thoughts, collective goodwill and duty to Edmonds' future. This is an opportunity to look to the future. Councilmember Chen thanked Ms. Feser, Ms. McLaughlin and Mr. Tatum for their hard work. From the beginning, he has been very skeptical, and still wants to proceed with an abundance of caution. He referred the $100,000 deposit the council authorized to hold the property until December 31, 2023. He asked if the seller could walk away anytime or do they have to commit to certain restrictions. City Attorney Jeff Taraday answered during the first six months of the option period, it was contemplated the parties would negotiate in good faith to finalize the terms of the purchase and sale agreement that would be attached to the option. During the first six month period, because there were so many things that needed to be negotiated, it was understood if the parties could not reach agreement during that time, the agreement would eventually terminate and the parties would return to their starting places. Councilmember Chen recalled about a month ago the council was negotiating the possible acquisition of property south of SR-104. The administration signed a purchase agreement without council's knowledge, but the seller abandoned the City. Under the current contract, the seller can walk away at any time. Even though he is excited about the possibility, at this point it is premature to allocate $250,000 without any requirements for the seller. The City could spend the money and end up with nothing like happened with the property south of SR-104. He preferred to stick with the original plan when the option agreement was signed; there are three smart, experienced directors on the task who have the expertise to develop answers by December 31, 2023 whether to move forward to the next stage. If the council decides to move ahead, that is the time to invest money in the work that needs to be done. The City does not have the money and he was not comfortable with redirecting the ARPA funds away from small businesses who suffered Edmonds City Council Approved Minutes August 22, 2023 Page 19 during the pandemic. That is what Congress intended the ARPA funds to be used for, to help the small businesses. Councilmember Teitzel raised a point of order, suggesting Councilmember Chen was not speaking to the motion. Mayor Nelson responding given that Councilmember Teitzel enumerated 11 other things the City should be spending money on, Councilmember Chen can be given grace in his comments. Councilmember Chen said he was speaking to the main motion. He did not support the main motion but also did not want to invest $250,000 at the moment. Councilmember Buckshnis said she is very fiscally conservative and has been through 12 budget cycles. Some councilmembers do not appear to understand the importance of the budget season and that the council is in the budget season now. The combined salaries of the three directors making this request is extremely expensive. She did not envision a seller walking away from a $37M price tag. She expressed support for the motion, advising approximately 90% of the comments she has received say no and 10% say yes. She referred to the half -year information provided by staff, noting there are more than 11 items that have not been completed or even started. The City needs to get back to basics, and she has issues with the entire budget. She expressed concern with trying to get this accomplished in four months, anticipating the case studies that staff provided likely took years. To do this in four months is just gambling, throwing the dice and she is a fiscal conservative, not a gambler. Anyone that has been through the budget season and understands numbers like she and Councilmember Teitzel do, will realize the City needs to slow down. She suggested if the seller put the property on the market, it was unlikely to sell and the City could plan accordingly next year. The council needs to get serious about its budget and this is not money the City cannot afford to spend now. She urged councilmembers to vote in favor of the motion. Council President Tibbott agreed with comments made on both sides and appreciated the presentation made by the three directors which brought inspiration and potential pathways, but also a level of caution. He agreed this needed to be approached with an abundance of caution. Assuming the council goes forward, he was interested in only funding due diligence and master planning at this time. He needs to know the situation on the ground and a basic site plan, what's possible on the site. Councilmember Teitzel raised a point of order, suggesting Council President Tibbott was not speaking to the motion. Mayor Nelson responded the point of the motion was to stop funding the plan; Council President Tibbott was citing specific budget needs for the plan so he ruled point not taken. Council President Tibbott continued it was premature to stop the investigation. The citizen advisory group has not yet been convened nor have other boards and commissions provided input. It is high time to get input from across the City and engage with citizen groups and gather additional information. If the process stops now, that opportunity will be missed. He acknowledged the City was struggling with its budgetary needs, but if a way to fund the basics could be determined, he would be interested. He did not support the motion. Councilmember Buckshnis referred to Ordinance 4079 regarding Planned Highway 99 Subarea includes Option I that states Highway 99 Subarea Plan is not an essential public facility as defined by RCW 36.70A.200I and any future projects which meet the definition of an essential public facility will not quality as planned action. She asked if this would be in violation of Ordinance 4079 due to plans for a public facility. Mr. Taraday answered essential public facilities are things like jails, major transit stops, etc. That language just means anything that falls in that category would have to go through a normal SEPA process. Ordinance 4079 exempts planned development from the normal SEPA process but because essential public facilities are not part of the planned development, they would still have to go through the normal SEPA process. Edmonds City Council Approved Minutes August 22, 2023 Page 20 Councilmember Buckshnis asked if the development strategy would require a SEPA process. Mr. Taraday answered development of the site is yet -to -determined so it is unclear whether it would fall within the contemplated development in Ordinance 4079 or not. UPON ROLL CALL, MOTION FAILED (3-4), COUNCILMEMBERS TEITZEL, BUCKSHNIS AND OLSON VOTING YES; COUNCIL PRESIDENT TIBBOTT AND COUNCILMEMBERS CHEN, PAINE AND NAND VOTING NO. COUNCILMEMBER NAND MOVED, SECONDED BY COUNCIL PRESIDENT TIBBOTT, TO FUND THE REQUEST FOR $135,000 TO COVER DUE DILIGENCE AND MASTER PLANNING FROM THE GREEN STREETS INITIATIVE. Councilmember Nand agreed it was premature to step away from this project at this point; however, moving the project forward requires majority council approval. She was not aware of anyone who purchase property without doing due diligence; that is an essential need for all councilmembers in deciding whether to make this a 2024 budget priority and beyond. Master planning outside the current administration could be very beneficial, staff is spread very thin and are working miracles with slim staffing. She was comfortable funding those asks through outside consultants and based on the information provided, making a discretionary decision on a future date whether to fund the development strategy and communication aspects of this plan. Councilmember Paine asked staff to review steps that would be included in the development strategy. It was her understanding the master planning would be done via a RFP. Mr. Tatum answered one of the first things that needs to happen with a development strategy is a market analysis very specific to this location and this market, what is needed to pencil out for the private market to put market rate housing, low income housing or retail in the current environment. Proforma financial analysis needs to be done; for example if the market could bring 400 housing units, what is the return from a tax perspective and a revenue perspective. Also, how much a developer would be willing to pay for underlying land value. A proforma financial analysis would also explore different ownership structures such as lease -back and what that would return to the City. For example, if the City decided to bond for $37M, does a lease -back provide the amount necessary to meet costs. Council workshops would also be part of that effort, talking with staff who have been engaged in work like this, visiting different projects, etc. Working through the partnership structure and timing recommendations; what type of partnerships and how they could be phased over the life of the project to ensure it is affordable for the City and developing an RFP for those partners. Councilmember Paine responded that sounded like a lot of the financial details the council would be interested in reviewing and what the Economic Development Commission would be asked to look at and review with the advisory committee and planning board. She did not want to miss out on this part of the project as it will explain the value of the property to the City now and in the future and what revenues could be expected. She always expected that this site would be tax revenue generating likely above what the City currently receives. She was willing to support funding the due diligence and master planning but also wanted to add $95,000 for a development strategy. If this motion is approved, she will make a motion to fund the development strategy. Council President Tibbott said he had difficulty supporting $135,000 at this time. During the next four months, a bare bones assessment needs to be done. COUNCIL PRESIDENT TIBBOTT MOVED, SECONDED BY COUNCILMEMBER NAND, TO REDUCE THE FUNDING TO $85,000 WITH $50,000 OF THAT COMING FROM ARPA FUNDING GREEN STREETS PROGRAM. Edmonds City Council Approved Minutes August 22, 2023 Page 21 Councilmember Chen shared information provided by Ms. Feser regarding how much has been spent on Long Bay Real Estate consulting services; the City has paid $14,941.25 to Long Bay Consulting related to the Burlington Factory property, $14,500 with CBIE, an outside appraisal company and $23,626 for OTAK for site analysis. A lot of work has been done to learn about the site, but that information has not been shared with the council. Ms. McLaughlin has done extensive work on this potential site acquisition, talking to different agencies to explore funding options and he recalled she invited him for a site tour about a year ago. If that information is available, possibly additional funds do not need to be spent. He agreed with Council President Tibbott that the council just needs barebones information to decide whether to move forward to the next phase or not. The price also needs to be negotiated to reflect market value; he questioned where the $37M figure came from, whether it was comparable offers. The task at hand is to negotiate the value of the land. He did not support the motion. Councilmember Nand thanked Mr. Tatum for enumerating the specific components of the development strategy. She noted some things could be done by the council without engaging a consultant; for example, council workshops. The council could do its own research, visiting the case studies and educating themselves. It would be beneficial to the City's administration to utilize the lobbying and cheerleading abilities of councilmembers. Councilmembers can identify potential partners and begin discussions without having that led by a consultant at this very exploratory stage. Her message to the administration is this is a very high profile proposition, it has generated a lot of excitement, debate and commentary and has almost, based on discussion tonight, become a referendum on the political status. Striping away the political overlay, the council just needs enough information to make a decision in the next four months. Councilmember Nand asked if that information could be provided for $85,000. Ms. McLaughlin answered directors are aware of the budget and have brought the leanest possible proposal. Staff has had these conversations about how can council help develop partnerships, having conversations with the community, broadening the umbrella, etc. She assured staff will lean on the council, EDC, planning board, etc. However, there is technical expertise that is not available inhouse. There is no one on City staff that does appraisals, there are no architects that design building footprints and calculate parking or the site layout with multiple options, in real time with community conversations to identify a desirable footprint and site plan. That information is absolutely critical in this first phase. The City is lowering the risk by frontloading the project with this information; these are the foundational decisions that council will need to make at the four month mark. Ms. McLaughlin continued, staff believes the information can be provided within four months to give council the confidence to decide whether to go to the next step. With regard to Councilmember Chen's comments about information, the City has no information on site planning, financing strategies or due diligence such as soil contamination. The consultants can provide technical expertise that is not available inhouse. Tasks such as project communications can be done by staff with the help of board, commissions and council. Possibly the development strategy could be trimmed, but the tasks mentioned by Mr. Tatum are foundational and that expertise is not available inhouse. She summarized she did not believe the cost could be reduced. Councilmember Nand agreed with doing due diligence. Council President Tibbott's amendment would leave $15,000 outside the projected expenditures for due diligence to cover master planning, development strategy and project communication and asked if that would be feasible to move the project forward to the four month decision point. Mr. Tatum said based on the questions everyone is asking, the answer is no. Everyone is asking serious, technical questions because they want details and have the confidence to enter into the next phase wisely. The triple constraints of any project, scope, schedule and budget, the schedule is constrained which is addressed by reducing the scope. In his opinion, if the scope is reduced too significantly, the council will not have the answers it needs. Edmonds City Council Approved Minutes August 22, 2023 Page 22 Councilmember Paine asked what staff would choose if they had to make a decision about what could be delayed in terms of scope. Ms. McLaughlin answered the staff team has the most expertise in master planning and likely could do some of it inhouse. She was sure the same could not be said about financing strategies. With regard to master planning, the vision will be the foundation for years to come and staff does not want to cut that short by reducing those costs now. A vision plays a part in partners, financing and delivering community facilities and needs. Councilmember Teitzel asked if staff was saying unless council approves the $250,000 funding request, council will not have the information it needs to make a well informed decision by the end of 2023. Mr. Tatum answered $250,000 will successfully set up the next steps. If this was funded at $200,000, the answers council wants could be provided although it would require some scrambling. Councilmember Teitzel said the next step in 12 months during 2024 is where the City will invest $ 1 M in earnest money which is nonrefundable. Mr. Tatum agreed. Councilmember Teitzel observed the risk to taxpayers increases exponentially next year based on what council decides at the end of 2023. Mr. Tatum advised the $1M is due December 31, 2024. The risk is not about $1M, it is related to setting the trajectory of this project for success. It is a short timeframe and staff wants the trajectory to be one that is most likely to succeed. Fully funding this budget request sets it on a trajectory for success and making good, sound decisions early on. COUNCIL PRESIDENT TIBBOTT WITHDREW THE AMENDMENT WITH THE AGREEMENT OF THE SECOND. UPON ROLL CALL, MOTION FAILED (2-5), COUNCILMEMBERS PAINE AND NAND VOTING YES; COUNCILMEMBERS TEITZEL, CHEN, BUCKSHNIS AND OLSON AND COUNCIL PRESIDENT TIBBOTT VOTING NO. COUNCILMEMBER NAND MOVED TO FUND THE $60,000 ASK FOR DUE DILIGENCE OUT OF THE GREEN STREETS FUND. MOTION FAILED FOR LACK OF A SECOND. COUNCILMEMBER PAINE MOVED, SECONDED BY COUNCILMEMBER NAND, TO FUND THE DEVELOPMENT STRATEGY COMING OUT OF THE GREEN STREETS FUND. Councilmember Paine said the financial aspects of the development strategy will be crucial and she would like to see the data it provides. Councilmember Olson pointed out the mayor has contracting authority for up to $100,000. If there is a feeling $100,000 cannot be spent from the General Fund because it is not affordable, that is very telling. She did not support funding $95,000 for the development strategy, but if the mayor chooses to proceed with that, the General Fund could be the source. If the funds are not available in the General Fund, then the development strategy should not be funded. Councilmember Teitzel recalled Councilmember Chen reporting approximately $50,000 had been spent on appraisal related costs for the property acquisition. He asked if the mayor would have the ability to spend another $100,000 in addition to that $50,000 or if the contracting limit was $50,000 due to the funds already spent. Mr. Taraday answered traditionally he has understood the mayor's contracting authority to be on a per vendor basis, up to $100,000 for goods and services with each contract with a different vendor. If $100,000 was exceeded with any vendor, that would require council approval. If the council disagrees with what he understands the mayor's contracting authority to be, that authority is delegated from the council to the mayor and that could be clarified by the council via a subsequent action. Edmonds City Council Approved Minutes August 22, 2023 Page 23 Councilmember Nand said she was opposed to Councilmember Olson's suggestion. If funding is allocated to this project, it should be allocated from the dais. There have been previous attempts related to acquisition of the Unocal property and other open space where the administration has been accused of trying to hide the ball from council by utilizing the spending authority in this exploratory way. She did think it was fair to send mixed signals to the administration that when council does not have the political will or does not want to take flax from angry citizens to spend taxpayer money in a certain way, then the administration should do that. She supported either the council voting to say this is a good expenditure of taxpayer money or the council voting to say they did not feel it was a good expenditure of taxpayer's money and that the council should ultimately be responsible for that decision. If the council decides to walk away from this, the council should bear the political cost of that decision as well. Council President Tibbott observed the intent was for staff to provide the council a budget presentation. He will be working on the details and bringing them back. COUNCIL PRESIDENT TIBBOTT MOVED, SECONDED BY COUNCILMEMBER PAINE, TO TABLE THIS ITEM UNTIL THE BUDGET SCENARIO IS DEVELOPED SO HE IS MORE CONFIDENT IN WHAT COULD POSSIBLY BE INVESTED. UPON ROLL CALL, MOTION CARRIED (4-3), COUNCIL PRESIDENT TIBBOTT AND COUNCILMEMBERS BUCKSHNIS, PAINE AND NAND VOTING YES; COUNCILMEMBERS TEITZEL, CHEN AND OLSON VOTING NO. 10. MAYOR'S COMMENTS Mayor Nelson thanked City staff for their work on the Landmark property acquisition proposal and budget request. The council has heard from a select group of people as well as 900 residents who have ideas about what this project could be. When he thinks about the fear that is being shared and concern being perpetuated and the misinformation that is being widely fanned and flamed, he was still hopeful that the benefits, the possibilities, the opportunities and the wonderful things that could potentially come from this project will come to fruition because at the end of the day, "nothing is more expensive than a missed opportunity." 11. COUNCIL COMMENTS Councilmember Buckshnis thanked everyone who commented and sent the council information. Her cell phone is not working so people can't call her, but she received at least 115 emails today although she has not reviewed them all. Work on the marsh continues; a work party is planned for tomorrow, Wednesday and Saturday, 9-11 a.m. to remove nightshade and spread wood chips. Councilmember Teitzel expressed amazement that so many people were willing to donate their time to the City for the good of all including the Floretum Garden Club and, volunteers in the marsh removing invasive nightshade and spreading wood chips. He participated in that work and can attest it is very hard work. He also expressed appreciation for the volunteers who serve on City boards and commissions, ECA volunteers, etc. Edmonds is fortunate to have engaged citizens who care about the City and want to donate their precious time. Council President Tibbott announced a volunteer appreciation event on September 5 at 4:30 p.m. at Civic Playfield; board and commission members will receive an invitation. It will be an opportunity to thank volunteers and enjoy time together. Council President Tibbott relayed the comprehensive planning process is supposed to be interesting and fun. It is exciting to learn about the City, explore environmental impacts, etc. He hoped citizens would engage in the process of imaging the prepared future together. He announced Popsicles in the Park at Edmonds City Council Approved Minutes August 22, 2023 Page 24 Mathay Ballinger on August 23 at 2:30 p.m. and at Hickman Park at 4:30 p.m., and August 24 at 4:30 at Five Corners. These are opportunities to talk about their interests and provide input. Councilmember Paine referred to comments in the community that the Landmark project was driven by the administration. She explained funds for land acquisition have been included in the last three budgets. The most recent budget included funds for public safety on Highway 99. The idea of a community center was raised as part of the PROS Plan. This has been council directed in many ways and staff is doing their job by finding ways to put it all together. Those items have been council priorities for the last few years. She looked forward to returning to this topic in the future, noting one of the comments she had heard was there have not been enough input from the residents near Lake Ballinger. The Landmark property is in their neighborhood and it will be important to hear from the residents and the business community. Councilmember Paine recognized the members of the carpenters' union who have spoken during the last four meetings, most of them staying for the entire meeting. She appreciated their talking about the pride they take in the work they do. She referred to Seattle projects including the China Gate next to Yesler Way overpass. Councilmember Olson pointed out Cascadia Art Museum is a jewel in Edmonds; the arts are one of her passions as well as a passion of others in the community. The arts make Edmonds special and different. She encouraged the public to attend Cascadia Art Museum's annual fundraiser this weekend. With regard to her comment about the mayor using his contracting authority, she clarified her statement was related to the source of the funds being General Funds versus ARPA funds and if that amount of General Fund could not be spared, maybe it was not a good expenditure. She is always willing to take the heat for her votes and has many times in the past and that was not the reason for making that suggestion. Councilmember Nand commented there have been many important statements made tonight about politics, funding, taxes and land. She reported a community member brought a sick rabbit to her house, a rabbit that appeared to be experiencing a seizure. If there are other sick rabbits in the community; she is an animal rescuer and will transport cottontails to a wildlife rehab and transport domestic or domestic feral rabbits to a veterinary. There has been an outbreak of Rabbit Hemorrhagic Disease (HD) causing massive die offs of the Langley colony and people are finding deal rabbit everywhere. She encouraged anyone finding a dead rabbit to contact the state veterinary office because they are tracking the outbreak. She encouraged rabbit owners to get their rabbits vaccinated for HD. She invited the public to reach out to her for more information or if they find a sick or dead rabbit. i P► MIX@1 9_ 1 With no further business, the council meeting was adjourned at 9:57 p.m. SCOTT PASSEY, Ci ll CLERK Edmonds City Council Approved Minutes August 22, 2023 Page 25