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12/07/1999 City CouncilEDMONDS CITY COUNCIL APPROVED MINUTES DECEMBER 7, 1999 Following.a Special Meeting at 6:30 to interview an applicant for City Council vacancy — Position No. 2, the Edmonds City Council meeting was called to order at 7:00 p.m. by Mayor Fahey in the Library Plaza Room, 650 Main Street. The meeting was opened with the flag salute. ELECTED OFFICIALS PRESENT Thomas A. Miller, Mayor Pro Tem Dick Van Hollebeke, Council President Pro Tem Gary Haakenson, Councilmember Dave Earling, Councilmember John Nordquist, Councilmember Michael Plunkett, Councilmember Jim White, Councilmember ELECTED OFFICIALS ABSENT Barbara Fahey, Mayor ALSO PRESENT Christie Lee, Student Representative 1. APPROVAL OF AGENDA STAFF PRESENT Tom Tomberg, Fire Chief Ray Miller, Development Services Director Peggy Hetzler, Administrative Services Director Noel Miller, Public Works Director James Walker, City Engineer Doug Farmen, Accounting Manager Don Fiene, Assistant City Engineer Steve Bullock, Senior Planner Kate Galloway, Planner Jim Haney, City Attorney Zack Lell, City Attorney Sandy Chase, City Clerk Jeannie Dines, Recorder COUNCIL PRESIDENT PRO TEM VAN HOLLEBEKE MOVED, SECONDED BY COUNCH.MEMBER PLUNKETT, FOR APPROVAL OF THE AGENDA AS PRESENTED. MOTION CARRIED. 2. CONSENT AGENDA ITEMS COUNCIL PRESIDENT PRO TEM VAN HOLLEBEKE MOVED, SECONDED BY COUNCILMEMBER NORDQUIST, FOR APPROVAL OF THE CONSENT AGENDA AS PRESENTED. Councilmember Earling requested Item C be removed from the Consent Agenda. MOTION CARRIED. The agenda items approved are as follows: City Council Approved Minutes December 7, 1999 Page 1 N (A) ROLL CALL [Approve 11 /15 (B) APPROVAL OF CITY COUNCIL MEETING MINUTES OF NOVEMBER 15, 1999 mutes pprove 11/30 (D) APPROVAL OF CITY COUNCIL MEETING MINUTES OF NOVEMBER 30, 1999 mutes City Council Approved Minutes December 7, 1999 Page 1 N (E) APPROVAL OF CLAIM WARRANTS #35903 THROUGH #37589 FOR THE WEEK OF aiimpproVe NOVEMBER 22, .1999, IN THE AMOUNT OF $552,349.76. APPROVAL OF CLAIM arrants WARRANTS #35906 THROUGH #37713 FOR THE WEEK OF NOVEMBER 29, 1999, IN THE AMOUNT OF $240,668.92. APPROVAL OF PAYROLL WARRANTS #26860 THROUGH #26637 FOR THE PERIOD NOVEMBER 16 THROUGH NOVEMBER 30, 1999, IN THE AMOUNT OF $340,057.38. (F) UPDATE ON HIGHWAY 99 PROJECT ro�ect ct eadowdale (G) REPORT ON FINAL CONSTRUCTION COSTS FOR THE MEADOWDALE STORM ,Storm provemin. nrprovemDRAINAGE IMPROVEMENTS PROJECT AND COUNCIL ACCEPTANCE OF ents PROJECT Farena Heach (H) REPORT ON BIDS RECEIVED ON NOVEMBER 2, 1999, FOR THE MARINA BEACH lay structure PLAY STRUCTURE REPLACEMENT arfTop- (I) AUTHORIZATION TO PURCHASE A MILLCREEK MODEL TD 75 TURF [Dresser TOPDRESSER Office (J) AUTHORIZATION FOR MAYOR TO SIGN RENEWAL OF OFFICE SUPPLIES, applies ri URNISHINGS, EQUIPMENT, AND PRINTING PURCHASING AGREEMENT WITH ontract LUND'S OFFICE ESSENTIALS Minute Taking (K) AUTHORIZATION FOR MAYOR TO SIGN PROFESSIONAL SERVICES AGREEMENT Services WITH JEANNIE DINES FOR MINUTE TAKING SERVICES rackett's (L) AUTHORIZATION FOR MAYOR TO SIGN PROFESSIONAL SERVICES AGREEMENT ndingN. WITH BARKER LANDSCAPE ARCHITECTS, P.S. FOR DESIGN/CONSTRUCTION "rid OBSERVATION FOR BRACKETT'S LANDING NORTH BULKHEAD REPAIR PROJECT IN THE AMOUNT OF $12,000 rd. # 3283 (nn ORDINANCE NO. 3283 AMENDING THE PROVISIONS OF EDMONDS COMMUNITY CDC DEVELOPMENT CODE SECTION 17.40.010(C) TO LIMIT THE APPLICATION OF 17.40.010 (C) THE CITY'S ABATEMENT PROCESS TO NONCONFORMING COMMERCIAL, batement BUSINESS AND INDUSTRIAL USES LOCATED IN RESIDENTIAL ZONES AND DIRECTING DEFINITION OF COMMERCIAL, BUSINESS AND INDUSTRIAL USES TO THE PLANNING BOARD FOR RECOMMENDATION Item C• Approval of City Council Meeting Minutes of November 23, 1999 Councilmember Earling advised he was absent from the November 23 meeting and would abstain from the vote. Approve 111231 COUNCILMEMBER NORDQUIST MOVED, SECONDED BY COUNCIL PRESIDENT PRO TEM mutes VAN HOLLEBEKE, FOR APPROVAL OF CONSENT AGENDA ITEM C. MOTION CARRIED, COUNCILMEMBER EARLING ABSTAINED. The agenda item approved is as follows: (C) APPROVAL OF CITY COUNCIL MEETING MINUTES OF NOVEMBER 23, 1999 earing on 3. PUBLIC HEARING ON THE FINAL ASSESSMENT ROLL FOR PERRINVILLE SANITARY final Assess- SEWER LOCAL IMPROVEMENT DISTRICT (LIDL 15 ent Roll — 215 i City Attorney Jim Haney advised he has been working with staff on LID 215 and 216 and will assist with the public hearings. He explained the Council has two final assessment hearings tonight, for LID 215 and LID 216. Mr. Haney explained ordinarily there are three stages in every LID, 1) formation of the City Council Approved Minutes December 7, 1999 Page 2 district which was done in December 1998 for LID 215 and in March 1999 for LID 216, 2) construction of the LID improvements and finalization of the costs, and 3) approval of the final assessment roll where the Council makes a determination regarding what each parcel in the LID will pay for the improvements. However, in the case of LID 215 and 216, the City has not yet constructed the improvements but is holding the final assessment hearings on both LIDs due to I-695. He explained a question has been raised by a number of attorneys whether, once I-695 takes affect, a public vote will be required prior to imposing an LID assessment due to the uncertainty regarding whether the LID -is an assessment, tax, fee, or other monetary charge imposed by government that requires a public vote. Approving the final assessment roll and making it effective prior to the January 1, 2000 will avoid any I-695 issues. He reiterated although this is not the usual procedure, it is a legal procedure and many cities have approved final assessment rolls prior to construction of the improvements. Mr. Haney explained the public hearing on the final assessment roll is an opportunity for property owners in the LID to protest the amount or appropriateness of the assessments as proposed to be assessed. The Council may raise, lower, correct, revise, or modify the assessment roll based on the protests. He identified the five legal principles for making that decision. (1) All legitimate costs/expenses of the LID can be included in a LID; costs not associated with the LID cannot be included. (2) Only properties that are specially benefited by the LID improvements can receive an assessment on the assessment roll. Special benefit is defined by the court as properties that have the ability to hook-up to the sanitary sewer line will receive some increase in fair market value from the LID improvements. (3) No property in the LID can be assessed at a rate that is substantially more than the amount of the special benefit it receives. The amount of special benefit for an individual property is defined by the courts as the difference in fair market value of the property with the LID improvement and the fair market value of the property without the improvement. (4) Assessments are supposed to be proportionate to one another; similarly situated properties should be treated similarly and properties whose special benefit differs should be treated differently in the LID. (5) The City goes into the hearing with the presumption that the first four principles have been complied with. Property owners who wish to protest their assessments bear the burden of presenting evidence at the public hearing that their assessments are incorrect and do not meet one of the four LID principles. If property owners present sufficient evidence in the form of expert appraisal testimony or other testimony from which the Council would conclude that their assessments are incorrect, the burden then shifts back to City staff to prove the assessments are correct. The State Statutes for the final assessment roll hearing require a property owner to file a written protest to dispute their assessment. He referred to the written protests already presented to the Council, indicating there may be other individuals who wish to protest their assessment and must file a written protest during the hearing. Once the Council hears the staff presentation, takes public comment and reviews the protests, the Council will make a decision regarding the final assessment. The culmination of the process'is the adoption of an ordinance by the City Council confirming the final. assessment roll. He said ordinances were not included in the Council packet, as findings regarding the protests will be included in the ordinance. The ordinances will be presented at the December 14 Council meeting. Lee Voorhees, City Bond Counsel, Foster Pepper & Shefelman, explained that City Attorney Scott Snyder contacted him this fall inquiring about the ability to close the assessment roll and hold the final assessment prior to year-end and prior to commencing construction. Mr. Voorhees said it was not unusual for cities and districts to confirm the final assessment roll prior to construction, as there are a variety of circumstances that make this necessary. Mr. Snyder also inquired about how the City would protect itself against potential cost overruns in'construction that had not yet begun. Mr. Voorhees said he City Council Approved Minutes December 7, 1999 Page 3 suggested including an additional charge of perhaps 10% in the amount of the initial assessments to cover overruns and have funds from the project to make a contribution to the local improvement guaranty fund. When LID bonds are sold, -they are payable via the LID fund and the local improvement guaranty fund. If additional moneys, up to 10% of a LID improvement are placed into the guaranty fund, the interest rate on the bond is reduced when they are issued, thus reducing the interest rate on the annual assessment installments to the property owners .Mr. Voorhees said when he first reviewed I-695, he was satisfied it would not affect special benefit assessments as a number of Washington State Supreme Court cases have ruled that special assessments are not taxes but are special benefit assessments. However, I-695 includes the following language, "any tax increase imposed by the State shall require voter approval. Tax includes but is not necessarily limited to any monetary charge by government. Tax increase includes but is not necessarily limited to a new tax. State includes but is not necessarily limited to the State itself and any city, county, special district, or other political subdivision of the State." Taken literally, a case could be made that a special benefit assessment is a new tax or a monetary charge by government. Therefore, if a lawsuit was filed asserting that confirmation of a special benefit assessment was the imposition of a new tax or a monetary charge by government, the City could encounter a 2-3 year delay before a ruling was made. If the Court determined that an election was required, it would likely be another 1-2 years before the Legislature adopts a statute providing instructions for the election such as who votes in the election (the entire City or only property owners in the LID) and what they are to vote on (the entire assessment roll or individual assessments on the roll). This situation presents both. a problem and an opportunity. He said they have been informing cities and districts not to proceed with. improvements until a determination is made on these issues. Therefore, the Council has the choice of 1) shelving the improvements until all questions are answered, 2) moving ahead without confirmation of the assessment and taking the risk of investing the City's funding with only a speculative determination of whether the assessments can be confirmed in the future and the properties assessed, .or 3) complete the assessment proceedings and pass an ordinance confirming the assessment prior to year end. He recommended the City proceed with option 3, arrange for interim construction financing for the project, build the project, total the costs, determine the actual expenses, and at that time, revisit whether the assessments would be proportionately reduced if the final project costs are below budget (with funds still available to adequately fund the guaranty fund). He recommended the assessments not be filed for collection until the final amount is known. Following the 30 -day prepayment period, LID bonds would be issued, the interim financing repaid, and the guaranty fund funded. Assistant City Engineer Don Fiene displayed a map of the properties within LID 215 and explained LID 215 was formed in December 1998 when 105 property owners representing 106 lots (61%) signed a petition. He explained the design of the improvements is essentially complete, only the procurement of some easements remains. Construction is anticipated to begin in spring 2000. At the advice of bond counsel, the LID final assessment hearing was scheduled for December 7. The final assessment roll has been prepared and the final cost reflects the latest construction estimate plus a 10% contingency. He displayed the November 1999 LID 215 construction estimate, explaining the cost is 15% over the original estimate due to the 10% construction contingency, the cost of easements, and 3% for inflation. The cost for each lot is $12,000 and the preliminary estimate was $10,400. Mr. Fiene explained on November 16, the Council declared their intent to reduce the assessments if the actual costs of the project are significantly lower. He said the estimates were based on an average of second low bids for similar projects. He advised notice of this public hearing was sent to property owners in the LID along with a cover letter. He pointed out construction of the improvements represents City Council Approved Minutes December 7, 1999 Page 4 0 $10,000 of the $12,000 assessment (83% of the total cost), design/engineering costs represent approximately 10% and miscellaneous administrative costs (bonding costs, legal costs, etc.) total 6-7%. Mayor Pro Tem Miller opened the public participation portion of the public hearing and advised the Council received letters from Jack and Sharon Miller and James and Alison Pope protesting LID 215. James Miner, 18027 73' Avenue W, Edmonds, asked if the construction start date has been confirmed, if residents would be informed when construction would take place on their street, and when the project would be completed. He asked if bids were sought from independent contractors or if the improvements would be constructed by the City. He said residents in their area already receive a bill for sewer although they are not on sewer. Roger Blair, 7115 181" Place SW, Edmonds, inquired about the options for paying the $12,000 assessment. Hearing no further comment, Mayor Pro Tem Miller closed the public participation portion of the public hearing. In response to questions, Mr. Fiene assured the intent is to begin the project in spring 2000 and staff is pursuing the acquisition of easements to allow that to occur. Staff does not dictate the construction schedule for bids because that likely would result in higher bids. Once a contractor is obtained, staff will request a construction schedule and hand delivered letters will be provided to homeowners advising when construction will occur in their area. He said there may be some ability to work with homeowners regarding scheduling. Regarding repayment of the assessment, Mr. Fiene explained there will be a short period of time when the assessment may be paid in its entirety but most property owners will utilize the bond that will be obtained by the City once final construction costs are determined. Property owners who utilize the bond will likely make yearly payments for a .period of ten years with interest on the bond. There is also a senior deferral program for low-income seniors; the State pays the City's assessment and the assessment becomes payable upon sale of the property. Mr. Fiene advised written protests were submitted for assessments 172 and 173 who hooked -up to sewer subsequent to the formation of the LID and staff recommends the assessments be reduced to zero. City Engineer Jim Walker explained the unconnected sewer charge is not relevant to these proceedings but is a fee charged to residents who do not have sewer (but live within the City limits) for the benefits provided by sewer treatment to the entire community. Regarding contracting of the project, this is a Public Works project that will follow the same standard procedure for any public construction including advertising for bids and the City's acceptance of the lowest responsible bidder. Residents' special requests/considerations could be considered by staff but typically scheduling of the construction is left to the contractor within the guidelines of the standard specifications. He explained assessments 172 and .173 could have been omitted from the preliminary assessment roll if staff had been aware of the situation at the onset of this process. These properties are connected to the Lynnwood sewer, system and thus receive no benefit from the proposed LID. Councilmember Haakenson observed the. City -Attorney's explanation indicated property owners with protests could address the Council and pointed out property owners without protest could also speak. City Council Approved Minutes December 7, 1999 Page 5 Mr. Haney agreed, pointing out the purpose of this public hearing was to determine what assessments to impose, therefore the primary purpose of the public hearing was to accept testimony from property owners who object to their assessment. Councilmember Haakenson referred to the two letters of protest received by the Council and said one of the letters was from the property owner of assessment 172, Jack Miller. Mayor Pro Tem Miller remanded the matter to Council for deliberation. Councilmember Nordquist observed the public comments made were questions and not protests. Mr. Haney agreed neither person questioned their assessment. He commented the Council had received -two letters of protest, one from assessment 172. COUNCILMEMBER NORDQUIST MOVED, SECONDED BY COUNCIL PRESIDENT PRO TEM VAN HOLLEBEKE, TO APPROVE THE FINAL ASSESSMENT ROLL FOR LID 215 WITH NO ASSESSMENT FOR 172 OR 173 AND INSTRUCT THE CITY ATTORNEY TO DRAFT THE ORDINANCE. MOTION CARRIED. Hearing on 4. PUBLIC HEARING ON THE FINAL ASSESSMENT ROLL FOR NORTH PERRINVILLE Final Assess- SANITARY SEWER LOCAL IMPROVEMENT DISTRICT (LID) 216 ent Roll — ID 216 Assistant City Engineer Don Fiene displayed a map of properties within LID 216. He explained LID 216 was formed in March 1999 following the formation hearing for LID 215. Prior to the formation of 215, only four signatures from owners in the LID 216 area had been obtained. Once the petitions were circulated, interest increased and 37 property owners, representing 39 lots (641/o), signed a petition. The design of the improvements is essentially complete. LID 215 and 216 will be considered one project although the costs have been kept separate for accounting purposes. At advice of Bond Counsel, the public hearing on the final assessment roll was scheduled for December 7 due to issues with I-695. The final assessment roll has been prepared and the final costs reflect the construction estimate plus a 10% construction contingency. He explained the Council declared their intent to reduce the assessments if the actual costs are significantly lower than the estimate. Notice of the public hearing and a cover letter was sent to property owners within the LID. Mr. Fiene displayed a November cost estimate for LID 216, noting it is higher than LID 215 because the lots tend to be larger in LID 216 and in some areas there is only one side of the street serviced by the sewer main as the other side is already connected to sewer. The estimated costs of the LID, is 15% over the preliminary estimate due to the 10% contingency, 3% inflation increase, and 2% for obtaining necessary easements. The preliminary estimate .was $11,900 and the estimated cost is now $13,750. Mayor Pro Tem Miller advised the same procedural rules described by the City Attorney for LID 215 applied to LID 216. Lee Voorhees, City Bond Counsel, Foster Pepper Shefelman, said because LID 215 and 216 are related improvements, they will be offered as a consolidated LID bond issue, which will save administrative and transactional costs. Mr. Haney advised the overheads Mr. Fiene presented were a part of the record and will be exhibits in the public hearing. City Council Approved Minutes December 7, 1999 Page 6 Councilmember White asked how the determination was made regarding the value increase to compute the assessment. Mr. Fiene answered actual appraisals of the property have not been done but staff feels the benefits are there. Mr. Voorhees said his review of the transcript of the formation hearings for both LIDS indicated there was some discussion of using a fee appraiser who was experienced in representing local governments in establishing assessments and values of assessment districts. The minutes of the formation hearings indicate this would be an additional cost and it appeared the assessment methodology adopted and in place at the time of formation would be adequate. Mr. Haney reminded the Council that in the formation hearings for the .LID, the Council specified the assessment method, which divides the number of residential units in the LID into the cost of the LID improvements to determine the assessment. The Council did not specify that appraisals or special benefit analysis would be obtained. He said there is a presumption that the benefit to the property exists and the assessments do not substantially exceed the special benefit. If a property owner presents appraisal testimony, an appraisal may be necessary to allow the City to respond. Councilmember White asked how the presumptions arose. Mr. Haney explained in case law from LIDS, State Statutes, the courts have indicated cities/districts start with the presumption and property owners have the ability to object and present evidence showing the presumption is incorrect. Not knowing if there would be protests and due to the timing of this LID, appraisals were not obtained to verify the special benefit. . Councilmember White inquired about the burden of proof. Mr. Haney explained the property owner has the burden to show they were not specially benefited or that the benefit was less than the amount of the assessment. Councilmember White asked what standard was used Mr. Haney explained if a property owner presents credible evidence via expert appraisal testimony that shows there is not an increase in the fair market value of their property, the burden shifts to the City to justify the assessment. Councilmember White questioned what represented credible evidence. Mr. Haney explained the courts have said the property owner must present expert appraisal testimony on fair market value. He said a property owner who could illustrate they cannot physically connect to the sewer -would not need appraisal testimony. Property owners who can connect must show they do not receive an increase in the fair market value from the improvement. Mayor Pro Tem Miller opened the public participation portion of the public hearing. Andy Hymes, 7005 179th Street SW, Edmonds, explained the process is about a year ahead of where property owners in LID 216 anticipated it would be based on the normal LID process. The letter received on November 16 was a shock to residents and represents a major adjustment in the process. The letter indicates the target date for beginning construction is spring 2000. He referred to the outline of the LID process provided to property owners that details the minimum duration of each step in the process and indicates the final assessment roll occurs after construction is complete. He referred to the City of Edmonds Information on Local Improvement Districts that also indicates this is a multi -step process with step 11 being the final assessment roll 'hearing and step 10 is construction, clearly indicating final assessment occurs after, construction. He said he has relied on the information in documents provided to make decisions as a property owner anticipating, sewer extension and adequate time was not provided for preparation of documentation to support his appeal. City Council Approved Minutes December 7, ] 999 Page 7 Mr. Hymes explained they had a drainfield constructed on their propertyin spring 1998 due to the drainfield's failure and following the failure of the first attempt to form a LID because there was not enough interest. Subsequently, residents showed more interest and the LID was formed. He explained. this resulted in their having a "$13,406 white elephant" on their property that is functioning beautifully with 13 years left to pay on a second mortgage to fund it and which has an estimated useful life of approximately 40 years. He said their property with a one-year old drainfield would not receive the same value as a property with a 30 -year old drainfield. Unfortunately, as the. City Attorney indicated, property owners have the burden of proof but a three week time period was not sufficient to obtain an appraisal, particularly in view of their previous understanding that appraisals would not be necessary.until summer 2000. He recommended LID 216 be delayed, the- previous procedure be followed, or. the City inform them what can be done within the proposed timeframe to substantiate the lack of increase in the property value. James Tripp, 7206 182"d SW, Edmonds, submitted a letter of protest. He said most of his questions have been answered by staff's presentation. He referred to the City's letter of November 11, which states . if the actual cost of the project was significantly lower than the final estimate, the assessments would be reduced appropriately to each property owner. He asked what the value of "significantly" would be. He referred to the City's letter of May 21, 1999, which stated many municipalities and water districts charge at least $1,000 to connect a single-family residence to the sewer system and Edmonds may be considering such fees in the future but only after there is a reasonable amount of time for property owners to connect. He questioned what would be a "reasonable amount of time" and said a $1,000,hook- up fee was outrageous. His investigation indicated this fee was for property owners without a stub line and he questioned what the $1,000 fee was for. Brian McCormick, 7008179`h St SW, Edmonds, referred to the 10% and 3% increase, stating there has been an incremental growth in costs since the beginning of the LID. He assumed some of those funds would be returned to property owners. He asked whether an accounting of the cost would be provided to residents. Hearing no further comment, May Pro Tem Miller closed the public participation portion of the public hearing. In response to Mr. Hymes' objection, Mr. Fiene explained there are 217 properties within the two LIDS and septic systems of many different ages. It would be difficult to determine a cost based. on the septic system age. He said the question is whether there is a value increase of the property with sewer versus with septic. He said the cost of the septic speaks to the benefit of the LID as the $13,000 cost of a drainfield likely does not increase the value of the house. In response to the definition of ."significant reduction," • Mr. Fiene explained . the intent is to proportionately reduce the assessments if the amount is more than $100,000 lower than the estimate. He said 5% would be retained fora contribution to the guaranty fund. Regarding the $1,000 fee mentioned by Mr. Tripp, the City does. not charge such a fee. The difference between the preliminary and final cost estimate is due to the addition of the 10% construction contingency as the City would not have a method of recovering additional funds if bids are higher than the estimate. He pointed out the assessments would be reduced if the cost difference is significantly lower. The difference between the preliminary and final cost estimate is 15%, the construction contingency is 10%, 3% is due to inflation as a result of.delaying City Council Approved Minutes December 7, 1999 Page 8 the project another year because of easement issues, and 2% is due to the cost of procuring easements in the event a condemnation' cess is necessary. Councilmember Haakenson asked staff to expand on the issue of easements. Mr. Fiene explained 40 easements were necessary throughout the LID for the concept developed by the consultant. All but 8-10 have been acquired. Procuring the easements has delayed the project and Council agreed if necessary to proceed with condemnation. Appraisals are being obtained on those properties and another letter will be sent indicating the City's intent, followed by necessary action to procure those easements to allow construction in spring 2000. . Responding to Councilmember Plunkett's question regarding Mr. Hymes' letter, Mr. Fiene said there is no formula for determining a reduction in benefit based on the age of a septic system. He discussed the expected life of a septic systemwith the Health District who gave a ballpark estimate of 30 years. He reiterated there is no specific formula for estimating the life expectancy of a septic system as it depends on soil conditions, etc. Councilmember White asked what a residential appraisal would cost and how quickly it could be done. Mr. Fiene answered approximately $800. Mr: Haney advised usually a special benefit study would be done for the entire LID which would cost thousands of dollars and take several months. City Engineer Jim Walker added that there are variable costs for an appraisal, it would likely cost $2,000 for an analysis of one property. The City would have done appraisals if a longer time frame had been available. Due to 1-695, the effort to establish the final assessment roll is moving forward. He said a proportional reduction could be proposed and later substantiated if it was determined there was a reduction in the benefit. Regarding the intent to proportionally refund savings of over $100,000, Councilmember White asked if it was anticipated 100% .of those funds would be refunded. He asked who determined that a $100,000 savings represented a significant savings. Mr. Fiene answered Mr. Voorhees, Mr. Haney and he agreed $100,000 was appropriate. Councilmember White asked how staff concluded that was their decision to make. Mr. Fiene answered that amount was staff's recommendation. Mr. Haney agreed it was not a conclusion, it was a recommendation so staff could include that information in the letter to, property owners in the LID. He explained consideration was given to what would represent a significant reduction in view of the administrative costs of reducing the assessments. He stressed the reduction would be the Council's decision. Councilmember White recalled the Council's previous discussion regarding this issue was if the savings realized exceeded the cost of administration of a refund, the refunds. would be made. He expected information regarding the savings and the cost of distribution to be presented to the Council for a decision on refunding. Mr. Fiene agreed. Councilmember Nordquist referred to a LID hearing held previously regarding Chase Lake Elementary to allow the school to remain open. He said if Mr. Hymes' septic system was so bad it required immediate replacement, the new drainfield would represent a public benefit to the community due to the potential for a failed septic to endanger other residents in his locale. Councilmember Nordquist asked about the possibility of a late comer's agreement or creative financing to provide some relief to Mr. Hymes. With the replacement of his drainfield and participation in the LID, Mr. Hymes would be spending over $26,000 in ten years to provide sewer service. City Council Approved Minutes December 7, 1999 Page 9 Mr. Haney said within the context of tonight's public hearing, that solution was not available. Regarding a latecomers agreement, the statute requires that prior to construction of an improvement, an agreement be entered into with the property owner making a determination there are others who are benefited by that property owner's improvement. He said the issue for the Council was whether Mr. Hymes' property was specially benefited by the improvements and whether he should pay the assessment. Mr. Voorhees referred to the presumptions Mr. Haney described at the beginning of LID 215 such as the assessment amount and that the assessment was validly determined, is fair equitable and proportionate,, and does not exceed the special benefit. These presumptions will carry the City's case in favor of the assessment unless material, credible evidence to the contrary is produced. Washington Supreme Court has addressed the question of what is appropriate evidence to rebut the evidence. In 1990, City of Seattle v Rogers Clothing, after discussing the presumptions the Court stated evidence of appraisal values and benefits was necessary to rebut these presumptions. The burden of proof shifts to the City only after the challenging party presents expert appraisal evidence showing the property would not be benefited by the approval (benefit meaning increase in value). Mr. Voorhees recalled Mr. Hymes indicated he did not have adequate,time to hire an appraiser and has spent about '$14,000 to install a septic system with a long anticipated life. Although the City Council has no legal obligation to reduce Mr. Hymes' assessment, the Council may reduce the assessment if they choose. Mr. Voorhees said although he was not a real estate appraiser, he said it would be difficult not to significantly increase the value of the property by the installation of a new 8 inch sewer, maintained and operated by a City in front of a residence, regardless of the type, cost, or age of the existing septic system. In a neighborhood with septic systems that are failing, there is a benefit to every residence in the neighborhood to have a public sanitary sewer installed and maintained regardless of how efficient the septic serving that property, might be. He reiterated that although the Council had no legal obligation to reduce Mr. Hymes' assessment, as he had not presented any evidence of appraisal value as a basis for a reduction, the Council could do whatever they felt was reasonable and equitable under the circumstances. Mayor Pro Tem Miller remanded this item to Council for deliberation. - Councilmember White recalled when the subject of appraisals was originally discussed, one of the reasons it was decided not to do' appraisals was the existence of the appeal process when homeowners could offer an appraisal to prove the assessment was incorrect and request a lower assessment. By accelerating the process, Mr. Hymes has not been afforded that opportunity. Councilmember White said although he was not suggesting the process be stopped due to valid reasons for moving forward, he. pointed out the consequence was Mr. Hymes did not get the opportunity to present evidence. He did not favor arbitrarily making a reduction in Mr. Hymes' assessment as he was uncertain that was an appropriate action but he was certain Mr. Hymes had not been given an adequate opportunity to present his case. Councilmember White proposed the project move forward with the assessments as presented by staff and an appraisal of Hymes' property be done with the funds in excess, or Mr. Hymes be given an opportunity to present an appraisal and allow the Council to make a determination regarding a reduction at that time. Mr. Haney said the Council was making a decision tonight whether to confirm the final assessment roll. If the final assessment roll was accepted, any further discussion regarding assessments was precluded: He said the difficulty was if Mr. Hymes was allowed to make a case that his assessment should be reduced, other property owners in the LID could argue that his assessment was not proportional to theirs and they had not been allowed the same opportunity to protest. He recommended the Council not allow Mr. Hymes to obtain an appraisal for consideration at a later date. City Council Approved Minutes December 7, 1999 Page 10 Councilmember White pointed out Mr. Hymes is the only property owner making a protest. Mr. Haney said other property owners have been presented with an assessment roll, which indicates all properties in the LID are assessed equally. If the assessment roll was confirmed and later amended to reduce Mr. Hymes' assessment, that would represent a separate process and other property owners in the LID would have to have an opportunity to respond. Councilmember White reiterated Mr. Hymes had not had an opportunity to present evidence that he was told he would have the opportunity to present. Mr. Voorhees pointed out the Council plans to revisit the amounts of the final assessment once the project is completed and final costs determined. He said he was unable to reliably speculate on the risks of treating the Hymes' assessment other than. proportional to other assessments in the LID. Council President Pro Tem Van Hollebeke shared Councilmember White's concern, pointing out the acceleration in the process eliminated property owners' opportunity for redress. He suggested Mr. Hymes' assessment be reduced by 30% or approximately a $3,900 reduction. He agreed although this was an arbitrary amount, it was a reasonable guesstimate regarding a potential differential.. Councilmember Earling said the Council has allowed itself to be seduced by the fact that the recent installation of a drainfield is a peculiar situation to one installed six months ago. He said each property would be. equally improved by the addition of sewer service to their street. To identify a percentage reduction or seek a later adjustment indicates the additional value of the sewer and a drainfield that is no longer functional adds additional value to a property. Although he sympathized with a property owner who had recently installed a drainfield, he'questioned how that could be adjudicated against a drainfield installed 6, 8, or 10 months ago. He agreed with staff's recommendation and did not support treating one property separately. Councilmember White agreed with Councilmember Earling's point and did not advocate providing a reduction as the basis of Mr. Hymes' new drainfield. As Mr. Voorhees stated, the availability of sanitary sewer increases the value of the property. However, Mr. Hymes' had not had an opportunity to present contrary evidence such as an appraisal. Councilmember White said a reduction may be appropriate because Mr. Hymes' had not had that opportunity. Councilmember Earling said although he is not a real estate appraiser, he is a real estate broker who has practiced in this area for 20 years and knows these neighborhoods well. He said running a sanitary sewer. pipe down the street creates value. for the homeowners. One of the reasons the Council has been interested in moving forward with this LID is the number of failed systems in that area. Some properties have been unable to be sold due to failed septic systems and value has been diminished by the lack of sewer. He said it was a great benefit to the entire community to have this problem solved.. Councilmember Haakenson asked -if making an exception in LID 216 when the Council has already .approved the final .assessment roll for LID 215, created a risk of property owners in LID 215 requesting the same consideration. Mr. Haney answered no, the only property owners who would be entitled to contest their assessment in the future would be those who bled written protests.. Anyone who did not file written protest would be precluded from -making an argument once the public hearing was closed. Councilmember Haakenson observed Mr. Tripp's comments did not correspond to the statements in his letter. He was concerned that all Mr. Tripp's concerns had been resolved by tonight's discussion. City Council Approved Minutes December 7, 1999 Page 11 Councilmember Plunkett said although Councilmember Earling indicated the value of the property would increase, he agreed with Councilmember White's comments that procedural due process, while not denied, has been severely impaired and was considering redress for that impairment. Councilmember White pointed out the ability for Mr. Hymes to obtain an appraisal to support his objection to the assessment was eliminated by the acceleration of the process and asked if this was challenged in court, would the entire procedure be, challenged. Mr. Haney answered he did not believe Mr. Hymes would be successful in a due process challenge and explained the Supreme Court said the due process a property owner is allowed in an assessment roll proceeding is for the legislature to decide. Once the legislature determines how the hearing will be noticed, that is sufficient due process. In this instance, the legislature has specified the length of time for notices and provided the procedure for an assessment roll prior to construction. The City complied with notice procedures in the statute by, 1) passing a resolution setting the hearing, 2) mailing notice to all property owners, and 3) publishing notice in the newspaper. The statue also identifies timelines (15 days prior, to the hearing). As all noticing procedures have been adhered to, property owners were given the due process that the legislature, in establishing the LID statutes, has determined property owners are provided. Mr. Voorhees explained Washington State law is clear on the identification of parties who are entitled to appeal City Council decisions on the confirmation of assessments. There is no realistic prospect that any other property owners could appeal the action on the final assessment roll because of the lack of time to hire an appraiser because the law states, and is supported by 10-12 appellate decisions, that in order to have an appeal. of an assessment, the party must file a written objection at or before the time of the hearing and present any evidence in support of their objection during that hearing, and the court's review is based on the record before the City Council. COUNCIL PRESIDENT PRO TEM VAN HOLLEBEKE MOVED, SECONDED BY COUNCILMEMBER PLUNKETT TO EXTEND THIS PUBLIC HEARING FOR 5 MINUTES. MOTION CARRIED. COUNCIL PRESIDENT PRO TEM VAN HOLLEBEKE MOVED TO APPROVE THE FINAL ASSESSMENT ROLL OF LID 216 WITH A REDUCTION OF 30% IN THE FINAL ASSESSMENT ON THE HYMES PROPERTY AT 7005 179TIl STREET SW. MOTION DIED FOR LACK OF A SECOND. COUNCILMEMBER WHITE MOVED, SECONDED BY COUNCILMEMBER PLUNKETT TO APPROVE THE FINAL ASSESSMENT ROLL FOR LID 216 WITH A REDUCTION OF 50% FOR THE HYMES PROPERTY. UPON ROLL CALL, THE MOTION CARRIED. (COUNCILMEMBERS PLUNKETT, WHITE, VAN HOLLEBEKE, AND NORDQUIST VOTED IN FAVOR, AND COUNCILMEMBERS EARLING, HAAKENSON AND MAYOR PRO TEM MILLER WERE OPPOSED. Mayor Pro Tem Miller declared a brief recess. Hearing"the 5. FINAL PUBLIC HEARING ON THE 2000 BUDGET 000 Budget Administrative Services Director Peggy Hetzler displayed the budget scenario developed following the November 20, 1999, budget deliberation explaining this had been updated during the past seven budget discussions. She referred to a reduction in the new permit and building fees, recalling she indicated last week these fees might be reduced following analysis of the anticipated activity levels. The $205,500 amount represents a reduction of approximately $60,000 .from last week's scenario.. She referred to City Council Approved Minutes December 1, 1999 Page 12 Transfers from Other Funds, explaining a number of positions had been identified that are managed by General Fund Directors but who support other funds. The $91,900 represents funds being transferred from the Combined Utility Fund and'the Drug Forfeiture Fund to pay for positions that support those funds but are housed within the General Fund. She said this amount also includes a $15,000 transfer from the Criminal Justice Fund to help restore funding for the Police Department Staff Assistant. She reported total adjustment revenue resources are now $20,916,400.. Ms. Hetzler referred to expenditures and explained miscellaneous adjustments on last week's scenario reflected a reduction in expenditures of approximately $38,000. The additional expenses reflected in the Transfers from Other Funds have been included in this line such as the Police Department: Sergeant, Staff Assistant, and Utility Accountant - positions in the General Fund but funded via transfers from other funds. As a result miscellaneous. adjustments has been increased from a credit of $38,000 to an expenditure of $41,700. The total adjustment expenditures for 2000 are $21,390,292. This results in a shortfall in revenues versus expenditures in 2000 of $473,892; offsetting this by beginning cash carry- forward of approximately $1.2 million would result in an ending general fund cash balance for 2000 of $743,788. She advised the proposed revisions have been used to calculate the anticipated impact of these revisions on 2001 and 2002 budgets. Council President Pro Tem Van Hollebeke recalled the year-end balance in 2001 was $79,000+ and is now a negative $114,400. Ms. Hetzler answered that is the result of the combined effect of reducing the amount of building and permit fee revenue and the addition of one other staff position that was not originally included. Council President Pro Tem Van Hollebeke said although he was reasonably satisfied. with the 2000 budget, he was concerned about 2001 and beyond. He pointed out expenditures are fairly well known and cost of living increases will result in increases if staffing continues as it currently exists. The only item that could favorably offset that would be an underestimate of revenue from sales tax, as property taxes will not dramatically change or the potential assistance from the Legislature. Ms. Hetzler said the contractual relationships with the providers of library services and EMS service could potentially be revisited. Councilmember White recalled Fire Department overtime had increased $20,000 and the $20,000 increase in Police Department overtime had been shifted to a staff position. He inquired about the source of the additional $15,000 needed to fund the Police Department position. Ms. Hetzler answered the funds were transferred from the Criminal Justice Fund and were included in the Transfer from Other Funds line. Councilmember Haakenson shared the concern regarding future years' budgets and clarified Ms. Hetzler's comments that library services could be eliminated but EMS services would not be eliminated. Ms. Hetzler clarified the libraryservice contract and the Medic 7 contract could be, renegotiated. Mayor Pro Tem Miller opened the public participation portion of the public hearing. Mary Van Meter, 9055 196''' Street SW, Edmonds, explained the Edmonds Bicentennial Pioneer Log Cabin was not a pioneer cabin but a unique cabin inspired by the recreational cabins from the Adirondacks and Yellowstone National Park. She said there were no other known log cabins of this vintage or time in Snohomish County. She explained on September 24, 1999, the cabin was renamed The Ganahl Hanley Log Cabin and was accepted on the list of the Washington Heritage Register. The cabin is one of only four public buildings in Edmonds listed on the State Historical registry. She said with proper repair and future maintenance, the cabin should last several hundred years. She advised a City Council Approved Minutes December 7, 1999 Page 13 letter requesting $10,000 of the $80,000 needed for the cabin's repair was sent to each Councilmember and the Mayor last month. Ms. Van Meter described the history of log cabins, the history of the builder of this log cabin, and famous visitors to the log cabin when it was used as a guesthouse. Molly Hanley Hopkins, 20213 84`h Place W, Edmonds, President of the Save Our Cabin Committee and representing her family including her late parents Lee and Dori Hanley and two sisters, explained the log cabin was part of their property in the Seaview area after her parents purchased the cabin after WWII . from Gaston Ganahl. When her parents subdivided the property in 1975, they wished to have the cabin preserved. With the help of the late Chet Bennett and Al Kincaid, the cabin was moved to its current site, donated by her family to the City, and dedicated in 1976 to be enjoyed by future generations. Sadly, the cabin was not placed on a foundation and nature and the elements. have taken their toll. The Save Our Cabin committee has worked for approximately 14 months to gain community awareness and support including fund raisers and reaching out to the business community, fraternal organizations, schools and many others. Their goal was $60,000 $80,000 that experts have indicated is needed to restore and renovate the cabin. The committee has raised over $34,000 in grant funds and donations but much more must be done and the City's help is needed. She commented the cabin is presently lit with holiday lights and serves as Santa's headquarters. She stressed the cabin is a true landmark, included in the elementary curriculum of the Edmonds School District for students studying the City's history. She said her parents gave the cabin to the City in good faith that it would be preserved by its new owner, the City of Edmonds, and enjoyed by future generations. She requested the City take a lead in the preservation effort and provide the requested funding. Norma Bruns, 816 Walnut, Edmonds, said she was a member of the Save Our Cabin Committee primarily due to her interest in the South Snohomish Heritage Society and because she was on the City Council when the decision was made to accept the cabin. She recalled the combined efforts of 150 people resulted in bringing the cabin to the City. She said the Snohomish County. Visitor's Bureau indicated 6,240 people visited the cabin in 1998 and 4,825 people telephoned the cabin to ask questions as well as letters received at the cabin. She stressed the importance of the goal in the ;City's Comprehensive Plan .to encourage the rehabilitation andrestoration of older buildings and historic buildings in order to retain a variety of building styles and continuity with the City's past. Jack Hall, 900 Sea Vista Place, Edmonds, a member of the Save Our Cabin, said Chambers Cable, Kiwanis Club and other service clubs have been involved in this effort. He reported only $1,000 of the funds received have been spent to date due to the volunteer efforts provided. He encouraged the City to respond to their request for funding. Bruce Nickolson said the way Olympia is moving forward in response to I-695 is obnoxious and planned to begin a campaign to request the State readjust the allocation of funds. He encouraged anyone interested in participating in this effort to contact him. He pointed out the City's revenues will not keep up with expenditures with nominal appreciation and cost of living increases. He stressed the need for citizens and business people to do something to increase revenue in the City. He said decisions will need to be made by the Mayor and Councilmembers to take some of the load off taxpayers due to increasing real estate taxes. He said the only way to do this was "get something going in our town" to ease that burden. He challenged residents to learn and understand the problems the City is encountering and contact the Legislature regarding allocation of funds. Al Rutledge, 7101 Lake Ballinger Way, Edmonds, a member of the Save Our Cabin Committee, advised the committee meets every Wednesday at City Hall. He said the cabin will bring new revenue to the City and recommended the requested funding be provided. City Council Approved Minutes December 7, 1999 Page 14 Ray Albano, 20916 76`h Avenue W, Edmonds, stated that all property taxes the Council has discussed are based on homes; however, there are a lot of citizens who live in apartments and in condominiums and many who are over 65. He described how his 2.4% increase in Social Security, an additional $23 per month, was used up on medical and tax increases. He pointed out there are a number of people in the City who live in apartments, single parents, seniors, etc. who will be impacted by the property. tax. increase because property owners will pass it on to tenants. He recommended the Council operate under parliamentary procedure, and recommended the Council increase its use of a motion to table. Lynn Wilson, 21306 84"' Avenue W, Edmonds, said she has enjoyed the efforts of the Save the Cabin committee and hoped it could be accomplished. On another matter, she said she has lost a lot of pride in the community recently under the current administration, particularly the handling of long-term employees and the taxpayers' money. Although she did not support I-695, she agreed with the sentiment that the federal and local government need to be held accountable to its taxpayers. She said last spring she learned the City spent approximately $90,000 on a Human Resources Study, an extensive study that included 5 -year staffing projections, recommended classes to accommodate City positions, and addressed compensation analysis and other issues. The study was to be the basis of all staff decisions. The Mayor referred to the study in her 2000 budget message, "every staff position in the City was thoroughly evaluated before being authorized by the Council. The Human Resources Study confirmed the need for the staffing that was in place and recommended, the addition of some specific positions." Ms. Wilson said the current administration has ignored and neglected the study's findings. Her husband was hired to fill the Planning Supervisor position in 1991 and has served under three different mayors. In April 1999, the current mayor directed his position be reclassified down three grades in the 2000 budget from Planning Supervisor to the position of a Senior Planner. This proposed change was initiated well in advance of I-695 and does not affect the budget monetarily. This change was not recommended by the Human Resources Study and not thoroughly evaluated by the City Council. He was told the purpose of the reclassification was to flatten out the organization. She pointed out flattening an organization limits promotional opportunities and is not good management. Ms. Wilson. said it was not good management to have a director supervise clerical or technical personnel, as that should be done by a lower level. She, questioned the City's goal to flatten the organization, noting a supervisor was added in. the Engineering Department and is included in the budget in a very subtle manner. She requested the new administration consider the situation and deny this downgrade in the 2000 budget. Roger Hertrich, 1020 Puget Drive, Edmonds, recalled previous budget discussions included retaining funds for the Senior Center although it was included with funding for the Edmonds Alliance for Economic Development (EAED) and the flower program. He said if the City is considering funding . anything, the Senior Center would be his preference. He said a LID program by the business district for the flowers would be appropriate. He said the EAED is not the Chamber of Commerce and represents only a few property owners with very special interests: He recommended funding of an employee and funding of the EAED at a later time. He suggested the City adopt a policy of no consultants and no travel until the City can afford it. Elaine Hamner -Yard, 9209 Olympic View Drive, Edmonds, related a question she has heard from five people this past week, why does the City have 11 engineers and why does a city of 40,000 require a Traffic Engineer? Councilmember Plunkett pointed out Councilmembers frequently receive requests for stop signs, speed bumps, and other traffic calming devices which the Traffic Engineer investigates. He skated the Traffic Engineer was included in the 2000 budget because her services are needed. He explained the Traffic City Council Approved Minutes December 7, 1999 Page 15 Engineer brings groups together several times a month to address concerns regarding traffic ' issues in their neighborhood. Councilmember Plunkett asked how much money was in the Council Contingency Fund. Ms. Hetzler answered $145,000. Mayor Pro Tem Miller remanded this issue to Council for. deliberation. In response to Mr.. Albano's comments, Councilmember Haakenson clarified property taxes were increased 3%. Councilmember Haakenson explained Mayor Fahey originally proposed a budget that cut $2.2 million in expenses and included no new revenue sources and asked the Council to indicate their preferences. The proposed budget is a result of a great deal of hard work over the last month. To retain the existing service levels, an additional $566,300 was necessary. He reviewed other restorations to the budget such as funding for the EAED, flower program, Community Services Director position, Fire Department overtime, PoliceDepartment Staff Assistant, the remainder of the pool season (funded in part by revenues from pool operation), Public Safety support positions, Building Inspector position (funded via the increases in fees), and other miscellaneous adjustments. To fund these restorations, the Council made a decision to raise property taxes 3% for the year 2000 and to recapture 1.22% of past property taxes, collect an EMS levy, and increase other fees. He said the restorations and property tax increases were necessary to retain the service levels that the majority of citizens want. Councilmember Haakenson said he and other Councilmembers have received telephone calls and letters questioning the action the Council took on property taxes. He asked the citizens who called him where they learned about the property tax increase, and they indicated they read it in the Enterprise whose headline stated, "City Will Raise Property Taxes." After explaining to the two callers what this actually meant, they were more comfortable with the increase. Referring to the letters provided to the Council, one letter. from Mrs. Meyer states the Council did not look into other options to generate other revenues. Councilmember Haakenson pointed out the Council thoroughly considered all options. The other letter questioned why only five Councilmembers were present the night the property tax levy was approved (via unanimous vote) and suggested perhaps the missing Councilmembers did not want to be held accountable for the legislation. Councilmember Haakenson explained the two Councilmembers who were absent that night voted in favor of the budget the following week. Councilmember Haakenson said even prior to I-695, he felt the City. government lacked communication with residents. Citizens who have time to attend or watch Council meetings on television may understand activities in the City. However, as most citizens do not have time to watch or attend Council meetings, the Council must determine how to better communicate with residents. Unfortunately, the City relies on the two newspapers that cover Council meetings. He pointed out there was no representation from either newspaper tonight and what is reported may not be what actually occurred. He said articles in the Enterprise did not include the fact that the City cut $1 million from the budget. He said if the present budget situation continues, his intent was to cut another $1 million from the budget during 2000 in preparation for 2001. He explained the $1 million reduction included some positions that will not be refilled but was mostly other items. Next year's reductions will include jobs. Councilmember Plunkett said when the Save Our Cabin Committee began their campaign, he questioned their ability to raise money for their effort, noting the City gave them little encouragement. Over the past year, they have developed. a considerable campaign and made a significant effort. He requested the Council identify $5,000 for the cabin and suggested it be funded from the Council Contingency Fund. City Council Approved Minutes December 7, 1999 Page 16 Councilmember White advised the hotel/motel tax is dedicated to benefit tourism, which it appears the cabin would qualify for. Councilmember White asked about the Fund 127, Gift Catalog Fund, which has an $89,000 balance. COUNCILMEMBER PLUNKETT MOVED, SECONDED BY COUNCILMEMBER WHITE, TO EXTEND DISCUSSION OF THIS ITEM FOR 10 MINUTES. MOTION CARRIED. Accounting Manager Doug Farmen explained part of the Fund 127 is restricted for Parks and Recreation including a contribution for public purposes, a portion is for artmuseums, capital funding for art pieces and statues, and a portion is restricted donations for Fire Suppression/EMS services. He said further research regarding the purpose would need to be done. Councilmember Haakenson recommended a new, title be established for this fund. For Councilmember White, Mr. Farmen explained the hotel/motel tax funds are restricted for tourism and promoting the City for overnight stays. He outlined transfers from the fund to municipal arts, tourism funds, and Sister City Commission for the promotion of tourism. Council President Pro Tem Van Hollebeke agreed the hotel/motel tax fund was previously restricted to promoting overnight stays for tourists but that restriction has been relaxed. He recommended Mayor Fahey, who is very familiar with the fund and its restrictions, research whether this would be an appropriate use for this fund due to the cabin's role in tourism. He was concerned with using the Council Contingency Fund as those moneys were to be used for emergency situations as yet unforeseen. Councilmember Plunkett asked who made the decision regarding the use of the hotel/motel funds and recalled there was a committee that made those decisions. Mr. Farmen was uncertain whether such a committee existed and said expenditures from the hotel/motel fund were at the Council's discretion. Historically $30,000 has gone to the EAED for tourism activities. Councilmember Haakenson observed that funding was reflected in the proposed 2000 budget. City Attorney Jim Haney recalled when the Legislature amended the hotel/motel tax in 1998, they required the creation of a Hotel/Motel Tax Advisory Committee. He was unable to locate the provision that indicated whether the City was required to consult that committee in order to make 1:hat amendment to the expenditure. COUNCILMEMBER PLUNKETT MOVED, SECONDED BY COUNCILMEMBER NORDQUIST, TO APPROPRIATE $5,000 FROM FUND 120, THE HOTEL/MOTEL TAX, AND THE COUNCIL DIRECT THE ADVISORY COMMITTEE TO EXPEND THE $5,000 ON THE LOG CABIN PROJECT, SUBJECT TO REVIEW BY THE CITY ATTORNEY. Councilmember Earling said one item in the budget cuts was the community grant. fund. - He said this action would be reinstating $5,000 in community grants.and stressed there were many other groups who could argue for additional funding. If the Council believed serious budget cuts were necessary and the City was in a serious budget crisis, a. decision must be made regarding additions to the budget. He stressed he would vote against any further additions to the budget. Council President Pro Tem Van Hollebeke said although he was sympathetic to the log cabin, he felt the proposed action was inappropriate in this context as the hotel/motel tax was a pass-through fund provided via taxes on hotels, motels, rental cars, etc. to promote tourism. Those funds will be available whether a motion is made tonight and may be an appropriate resource for funding the log cabin. City Council Approved Minutes December 7, 1999 Page 17 COUNCIL PRESIDENT PRO. TEM VAN HOLLEBEKE MOVED, SECONDED BY COUNCILMEMBER HAAKENS0N, TO EXTEND THE MEETING ONE-HOUR. MOTION CARRIED. COUNCIL PRESIDENT PRO TEM VAN HOLLEBEEE MOVED, SECONDED BY COUNCILMEMBER HAAKENSON,. TO EXTEND DISCUSSION OF THIS ITEM FOR 5 MINUTES. MOTION CARRIED. Councilmember Haakenson asked for an estimate on how the funds come into the hotel/motel fund, the limitations on funding, and whether there was an effect on the General Fund. Ms. Hetzler answered there is no affect on the General Fund. She indicated she has not been directly involved with this fund as it is managed by the Parks and Recreation Director. Councilmember Haakenson asked how the funds were collected and how they were used. Mr. Farmen answered the revenues are received via the. state on a monthly basis. Historically approximately $60,000 per year has been received plus 5% interest on the fund balance. He said in the past $30,000 has been provided to EAED and transfers made for municipal arts (concerts in the park) and tourism, expenditures such as Sister Cities. Councilmember Haakenson questioned if the funds in the hotel/motel fund could be used to fund Fire Department overtime or a maintenance person at the Public Safety complex. Mr. Farmen answered no, the use of, the funds are restricted by the State Legislature. Councilmember White said he was somewhat familiar with the hotel/motel. tax, as it was the primary source of funding for the Cultural Arts Stadium and Convention District (CASCD). The fund is held by the county and passed through the City. One of his goals for the next year was to acquire as much of those funds from the county as possible. He said Snohomish County is looking for a project to spend the funds on and it was appropriate to approach them on smaller projects as a significant amount is dedicated to South Snohomish County projects. He suggested this issue be tabled until the potential for funding via the hotel/motel fund can be examined further. COUNCILMEMBER EARLING MOVED, SECONDED BY COUNCILMEMBER WHITE, TO TABLE THE DISCUSSION ON AN APPROPRIATION FROM THE HOTEL/MOTEL TAX FUND TO THE LOG CABIN. MOTION CARRIED. Ord. 43284 COUNCILMEMBER HAAKENSON MOVED, SECONDED BY COUNCIL PRESIDENT PRO Adopting 2000 TEM VAN HOLLEBEKE, TO APPROVE ORDINANCE NO. 3284, ADOPTING THE FINAL Budget BUDGET OF THE CITY FOR THE FISCAL YEAR COMMENCING JANUARY 1, 2000, PROVIDING FOR MONTHLY REVENUE REPORTS AND FIXING A TIME WHEN THE SAME SHALL BECOME EFFECTIVE. MOTION CARRIED. Closed Record 6. CLOSED RECORD APPEAL MEETING — APPEAL OF THE HEARING EXAMINER'S Appeal — DECISION TO DENY THE APPLICANT'S/APPELLANT'S TWO VARIANCE REQUESTS Herman AP -99-208 FILED UNDER FILE NO V-99-164• 1) A VARIANCE TO REDUCE THE REQUIRED REAR - YARD SETBACK FROM 15 -FEET TO 6 -FEET FOR THE CONSTRUCTION OF A NEW CARPORT STRUCTURE,• AND 2) A VARIANCE TO INCREASE THE MAXIMUM FENCE HEIGHT FROM 6 -FEET TO 7 -FEET ABOVE GRADE TO ALLOW THE CONSTRUCTION OF A TRELLIS ON TOP OF A FENCE (Appellant: Douglas Herman / File No AP -99-208 / A,pplieant• Douglas Herman / File No. V-99-164 Councilmember Miller asked if any Councilmembers wished to make a disclosure. Councilmember Earling advised a number of years ago his company had a condominium project listed with Mr. Herman as the seller. .Mayor Pro Tem Miller asked if there were any challenges to the participation of any Councilmembers. There were no challenges voiced. City Council Approved Minutes December 7, 1999 Page 18 Planner Kate Galloway explained the applicant/appellant, Douglas Herman, requested two variances for his project on 5`h Avenue South, a conversion of an apartment building into a condominium. The variances requested include a reduction in the rear yard setback of 15 feet to 6 feet for a detached carport structure and an increase in the maximum height allowance for fences from 6 feet to 7 feet. Staff recommended denial on the basis there did not appear to be special circumstances and that it would be a grant of special privilege. The Hearing Examiner agreed with staff's decision and denied both appeals. Mr. Herman filed an appeal on October 8, 1999; staff and the Hearing Examiner do not: feel there are special circumstances for a variance request and if granted would be a grant of special privilege. City Attorney Jim Haney explained this is a closed record appeal, therefore, no new evidence could be provided and a decision must be based on the record. Applicant Doug Herman, 403 3rd Avenue N, Edmonds, said staff indicated there were no special circumstances, however, page 2 of the staff report cites variance V-11=86 which was granted due to a grade situation. Item 4, Page 3 of the staff report states this project had a steep grade at the time it was constructed, and is the reason there is an 8 -foot rockery in front of the project. He said the building was constructed in 1979 and the code was changed in 1981. The projects around this building were granted special privilege by allowing .their carports to be constructed on the property line from 1960 to 1969. If the City granted a special privilege at that time, he asked if that carried forward. He said their proposal is an attempt to clean up this 20 -year-old, building, a proposal the neighbors are in favor of. He said staff indicated they did not have records from the 1960s, yet some records from 1960 to 1969 must be available for the projects that were allowed to have carports and structures. He pointed out Edgewood that has a concrete structure on 5`h Avenue, and the 5th Avenue Condominiums have a similar structure. He asked if that represented a precedence that could be brought forward. Mr. Haney said whether the other properties were grounds for granting Mr. Herman a variance would depend on how the other carports were developed. If they were allowed by the code at the time they were established and the code now prohibits them, they are legal non -conforming uses which would not give Mr. Herman the ability to request a variance now. Mr. Haney said in legal non -conforming uses and variance situations like this, the courts have ruled that the fact that there are other properties in the vicinity which may have buildings that today would not be allowed is not grounds for granting a variance because the law presumes they are either illegal uses or legal non -conforming uses, neither of which are grounds for granting a variance. Mr. Herman said the only change between 1981 and now is the RM zone had a 20 foot rear yard setback and today they have a 15 -foot rear yard setback. He said this indicates several buildings were granted some special privileges they are not being granted. He reiterated he has' the neighbors' approval as well as the ADB's approval. Regarding the fence, he explained the fence is in compliance but: staff indicated the trellis on top of the fence is not in compliance. He said the code does not address the word trellis so staff is referring to it as a structure. The fence with the trellis is 11 inches taller than allowed but the subject property is the only one impacted by the fence. If the fence is reduced 11 inches, it will be right in the window. Mayor Pro Tem Miller remanded the matter to Council for deliberation. City Council Approved Minutes December 7, 1999 Page 19 COUNCILMEMBER PLUNKETT MOVED, SECONDED BY COUNCIL PRESIDENT -PRO TEM VAN HOLLEBEKE, TO DENY THE APPEAL AND UPHOLD THE HEARING EXAMINER'S DECISION. Council President Pro Tem Van Hollebeke said he appreciated what Mr. Herman was attempting to accomplish. However, the Council must abide by the regulations regardless of whether the neighbors object. If the Council granted a variance that did not meet the criteria for a variance, others would request similar variances, siting this case as evidence. MOTION CARRIED. Closed Record 7. CLOSED RECORD APPEAL MEETING (CONTINUED FROM NOVEMBER 23; 1999) — APPEAL Appeal — OF THE ARCHITECTURAL DESIGN BOARD DECISION TO APPROVE AN APPLICATION Mallonee AP -99-201 BY DOUGLAS SPEE FOR A MIXED-USE BUILDING INCORPORATING COMMERCIAL USES AND PARKING ON THE FIRST FLOOR AND 18 RESIDENTIAL UNITS ON THE 2ND AND 3RD FLOORS. THE DEVELOPMENT ALSO INCLUDES AN UNDERGROUND PARKING GARAGE. THE SUBJECT PROPERTY IS LOCATED AT 307 BELL STREET AND 210 32 AVENUE NORTH AND IS ZONED "COMMUNITY BUSINESS -BC:' Appellant: James A. Mallonee /File No. AP -99-201 / Applicant: Douglas Spee / File No. ADB -98-191 Councilmember Miller asked if any Councilmember wished to make a disclosure. There were no disclosures made. Senior Planner Steve Bullock said although he was not the staff person responsible for this project, he was present at all ADB meetings when this project was discussed and when decisions were made. He explained this is a mixed-use building that will include commercial space on the ground floor, two floors of residential units (18 total units) and parking for all proposed units. He advised the applicant contacted the City two years ago and began formulating a conceptual plan and determining how to comply with' City codes. The applicant presented an ADB application on November 20, 1998 and had a preliminary review meeting at a public ADB meeting in January 1999. This meeting was not advertised as a public hearing due to limitations on the number of public hearings that can be held on a project. The first public hearing before the ADB was held April 21, 1999, and continued to May 19, 1999, when a decision was made by the ADB to deny the application with a 3-2 vote. Prior to the expiration of the appeal period, the applicant submitted a request for reconsideration to the ADB with a request that he be allowed to clarify his design and respond to the ADB's concerns. At the June 2, 1999 meeting, the ADB granted the reconsideration.. Prior to a public hearing on the reconsideration request, the applicant appeared before the ADB at the July 21, 1999 ADB meeting to get feedback and review on how he should depict his clarification and responses to the ADB's concerns. The ADB scheduled the reconsideration public hearing for September 15, 1999. Due to scheduling conflicts the public hearing was continued to the October 6, 1999 ADB meeting. After reviewing the documents and further clarification of the applicant's proposal, the ADB approved the application with a 6-1 vote. Mr. Bullock stated that Mr. Mallonee's appeal letter indicates, 1) private meetings were held between the developer and the ADB, 2) discussions regarding the City's visioning process impacted the ADB's decision, and 3) the project did not meet codes, blocks views, and was incompatible with its surroundings. With regard to the first issue raised by Mr. Mallonee, all discussions between the applicant and the ADB have occurred at public ADB meetings, there have been no private meetings. There has been only two public hearings, each was continued — the original public hearing when the City Council Approved Minutes December 7, 1999 Page 20 application was denied and the second public hearing held on the request for reconsideration which resulted in approval of the application. Regarding the second issue raised in Mr. Mallonee's letter, Mr. Bullock directed the Council's attention to page 61 of the Council packet (verbatim transcript ' of the October 6, 1999 ADB meeting) and Boardmember Chalupnik's comments regarding a candidacy meeting where campaign issues were discussed including concern with the 25 -foot height limit. Mr. Bullock referred to the comments by Boardmember Raflo on page 61, which indicate the visioning report seemed to address increasing height and density. Mr. Bullock referred to page 64 and Boardmember Raflo's clarification of her statement regarding the visioning. Mr. Bullock summarized Boardmember Raflo's comments that one boardmember had raised the issue of discussions at a campaign meeting and she had raised a counterpoint from discussions during the visioning process. Boardmember Raflo wanted to point out there were differing opinions regarding height and neither should impact the ADB's decision on this application. Regarding the third issue raised by Mr..Mallonee, Mr. Bullock displayed an overhead of the roof plan (page 12 of the Council packet) and highlighted how the project met the zoning code with regard to heights. He said the City of Edmonds Zoning Code as shown on page 67 of the Council packet includes a table with the development standards for the BC zone indicating the maximum height of 25 feet with a footnote. The footnote reads, "roof only may extend five feet above the stated height limit if all portions of the. roof above the stated height are modulated in design and are designed as a hip, gable, arch, shed or other similar roof form (see illustrations). Vertical parapet walls or flat roofs with a pitch of less than 3 - in -12 are not allowed to protrude' above the 25 -foot height limit unless they are part of an approved modulated design." Mr. Bullock explained the way that has been interpreted by staff and the ADB is that the ADB, as the body appointed by the City Council to consider architectural character, is the body that is to make the decision whether a project has a modulated design over the 25 feet. If a design is proposed that does not have a 3 -in -12 or greater pitched roof, a special review of the roof design is .required. Mr. Bullock referred to the roof design (page 12 of the Council packet) identifying the property line for the project and the exterior wall of the building on 3`d Avenue N and Bell Street. He pointed out the building moves in and out substantially, does not have any large, massive areas, and is stepped back from the. property line up to 8-10 feet in some areas. The BC zone allows buildings to be constructed up to the property line, as there is no setback requirement. He pointed out a majority of the buildings in the BC zone are constructed from property line to property line which results in boxes that extend to the property line that are 25 feet high with a roof at a 4 -in 12 pitch. This applicant's proposal is unique and is the first time this method of addressing the modulated roof has been proposed. Mr. Bullock referred to a rendering of the front of the building (Exhibit 2 on page 6 of the Council packet), noting it illustrated a building with vertical walls and a flat roof. Mr. Bullock explained the applicant proposes to move the building away from the property line, up to 10 feet in some areas, and the top elevation of the walls are 28, 29, and 30 feet in height. The varying top elevation together with the building exterior walls stepped back from the property line would have the same volume as a building constructed to the property line, had a 25 foot height with a pitch of 4 -in -12 up to 30 feet. He commented there was a great deal of discussion regarding this issue by the ADB. Because this building's parapets vary in height, it provides more view corridors than a building with a pitched roof up to a ridgeline of 30 feet on the entire property. Mr. Bullock explained the building is located on the northeast corner of 3`d and Bell; across the street to the west on 3rd and Bell is another 3 -story condominium project; further north on Yd Avenue N on the City Council Approved Minutes December 7, 1999 Page 21 1 same street is a 3 -story apartment; and further south on 3rd Avenue N there are a number of new developments that are 3 stories in height. He summarized the ADB considered all these issues and ultimately determined the roof design met their evaluation of a modulated design and it was approved as a modulated roof design. The ADB felt the building did not substantially block views as it is on the west side of the Floral Arts Center which has a ridgeline higher than the proposed maximum ridge of this building. The ADB felt the building fit into its surroundings, as there are a substantial number of 3 -story buildings in the immediate area. Councilmember White asked where "modulated roof' was defined in the code. Mr. Bullock answered it is not defined in the code. Councilmember White observed it was a subjective opinion of the ADB that is sitting at the time the decision is made. Mr. Bullock agreed, explaining the only definition in the code is via the three examples (page 68 of the Council packet) illustrating what a modulated design might be. Mr. Bullock said part of the reason the language was not included was not to "cookie cutter" new development in downtown and to allow unique architectural designs to take place in the downtown area and leave the decision to the discretion of the ADB. For Councilmember White, Mr. Bullock said the height of the parapet walls vary between 28,-29 and 30 feet. Mayor Pro Tem Miller described the process, indicating the appellant and applicant would be given ten minutes to provide testimony and the appellant could reserve a portion of that time for rebuttal. Appellant James Mallonee, 217 5'h Avenue N, Unit C, Edmonds, expressed his appreciation for postponing this matter due to his uncle's death. Mr. Mallonee asked to reserve two minutes for rebuttal. Regarding the first issue raised in his appeal letter, Mr. Mallonee said the July 21 meeting was not advertised and represented an unadvertised appearance by the applicant at the ADB seeking more. information. Although he was a party of record, he was not apprised of the meeting and was not aware of what modifications or discussions may have occurred at the meeting. He learned of the July 21 meeting when it was mentioned at the October 6 meeting. Regarding the second issue he raised in his letter, Mr. Mallonee said the ADB's discussion on October 6 centered, in his opinion, on speculation of the possible reclassification of height limits. He said the fact"that the four candidates who were not in favor of relaxing the height limits were elected indicates heavy consideration was given to'height limits. He pointed out the height limits have not been strictly imposed in this situation. Regarding the third issue he raised, Mr. Mallonee displayed the examples of modulated roof designs (page 68 of the Council packet), commenting his interpretation of the information differed from staff's interpretation. He pointed out the examples show a building increasing from 25 feet to 30 feet but there are separations in the roof and there is not a flat roof. He explained when he purchased his home three years ago, he carefully reviewed the urban design guidelines, which require variation in roof design. He displayed the rendering of the completed building, commenting the proposed building is a huge building, has a flat roof, is 120 x 120 feet per floor for a total square footage of 14,400 per floor, and only 3-4% is for businesses. Mr. Mallonee said in his interpretation the proposed building did not follow the code as ECDC 20.10.070(C)3 requires if there was. a blockage of a view, there must be a determination of the financial impact. Mr. Mallonee attempted to circulate a photograph but as that information had not been presented to the ADB, Mr. Haney indicated it was new evidence and could not be considered. Mr. Mallonee said City Council Approved Minutes December 7, 1999 Page 22 when he purchased his home, he had a view of the ferry dock, a view this building will eliminate. This will cause a reduction in the market value of his home which he indicated he would submit to the City Attorney for compensation. Regarding incompatibility, Mr. Mallonee referred to the statement in his letter of appeal regarding ECDC Chapter 20.10.070(A) 6 which states the size and height of buildings should be compatible with buildings in the area. Mr. Mallonee said this building is not compatible as there is nothing like it in the area. Mr. Mallonee said the issue of inconsistency is also outlined in his letter of appeal. Mr. Mallonee requested the Council consider this evidence and reverse the ADB's decision. Councilmember Earling asked Mr. Mallonee which floor his residence was on. Mr. Mallonee answered the upper floor. Applican Doug Spee, 307 Bell Street, Edmonds, stressed this has been a 2 -year process that began in January 1998. After constructing the Edmonds Floral Center, he learned any project in Edmonds must begin in Planning. He stressed throughout this entire process, he has taken that approach, including seeking the input of the City planner, development of a preliminary design, and preliminary meetings with .all department heads in the Building, Engineering and Planning divisions. At the request of the Building Official, the design was submitted to the International Council of Building Officials to scrutinize it for 1997 UBC issues as the City was changing to the new code. He hired a code writer involved with the National UBC for 2000 and included him in preliminary meetings to ensure everyone's input was included in the development of an interesting and attractive project. This lead to the ADB process. Regarding Mr. Mallonee's statement that the building was too tall, Mr. Spee disagreed with the statement that he cannot go to 30 feet. He displayed amore current rendering of the proposed building, pointing out the primary difference was the removal of the heavy band of brick originally proposed for the radius corner. The ADB felt this was too massive for the corner and that upper band was removed and the cornice taken back to the wall line. He explained this resulted in the elimination of the: 30 -foot outer wall. He pointed out there were no walls above 25 feet at the property line. The highest point at the property line was the four columns that break up the deck railing. He referred to the statement that a flat roof above 25 feet was allowed if part of an approved modulated design. He said they interpreted this to mean if they had an interesting, attractive, modulated face of the building on all four sides to create a good modulated design, the roof could be extended to 30 feet. The ADB disagreed and indicated the entire roof needed to include sections of parapet that fade into the roof. Mr. Spee said, as a result, there was not just a modulated appearance, the entire roof climbs and falls which meets the code. Regarding mass and size in relation to other buildings, Mr. Spee pointed out the Floral Center's ridgeline is 90 feet and the highest point of his parapet is 2 feet below that at 88 feet, stepping down to 87 and 86 feet. He disagreed the proposed building would present any significant view blockage as his building is 2 feet below the ridgeline of Edmonds Floral Center which is away from the views. He agreed there may be a few angles where the building may interrupt views but that did not represent a significant view blockage. He referred to another permitted project on YdAvenue W, pointing out the peak: is 5 feet taller than his proposed building. He stressed his project was not dwarfing any other building in the area. Regarding whether the proposed building fits the code, Mr. Spee quoted from the Urban Design Guidelines (page 79 of the Council packet), "however the building forms are employed, buildings should avoid long unbroken roof and wall lines. Where buildings are located on corner lots, the shapes and City Council Approved Minutes December 7, 1999 Page 23 forms of the building should accent the corner. Buildings on corner lots must be designed to provide visual interest and modulation on both street frontages. Typical details for this type of development include a strong cornice, building ornamentation, awning, storefront windows, and balconies. All buildings should have a clear entry expression such as arches, awnings, shutters or other entry defining characteristics. All of these items along with the shapes and forms of the building should be combined.to avoid large, massive walls. Modulation of walls, texture, materials and windows should be used to break up the appearance of the walls." Mr. Spee requested the Council uphold the ADB's decision and demonstrate their support for City staff who guided him through every step of the process over the past 23 months. Councilmember, White asked if there was a description of the lowest and highest points of.the roof. Mr. Spee advised the heights were described on page 12, a roof plan for the project. He explained in areas that have a parapet height of 30 feet, the roof is 29 feet. The lowest point of the roof is 27 feet. He pointed out more than 50% of the building is at the lowest height. Mr. Spee pointed out the examples Mr. Mallonee referred to are all 3 -stories. Abellant Rebuttal Mr. Mallonee said the rendering of the building he displayed was the rendering that was voted on and he was uncertain what differences there were between this rendering and the rendering displayed by Mr. Spee. He said in his opinion the proposed building had a flat roof and was 30 -feet high. He reiterated ECDC 20.10.070(C) states that buildings taller than two stories shall be reviewed to determine the extent to which they will block views from surrounding properties. He said this criteria had not been followed and complete consideration had not been given as required to approve this project. Mr. Haney requested Mr. Mallonee provide the City Clerk a copy of the list - of concerns he had displayed. Comment by Parties of Record Roger Hertrich, 1020 Puget Drive, Edmonds, said his concern is the fact that there is not a 25 -foot building height limit anymore, there is a 30 -foot building height limit. He said. the buildings go to 30 feet and modulate downward but the intent of the code was to go to 25 feet and modulate upward. He said what is gained is an entire floor and a property line to property line building on two lots in this instance that will block views.. He said the creation of the modulation effect is being used to create 30 - foot high roofs although a desire to eliminate boring, flat roofs was the reason the Council revised the, design criteria to include the modulated design. He pointed out the code indicated neighborhoods are to be protected from incompatible additions that do not harmonize. He suggested the apartment building across the street from the proposed building was not built to the curb but was setback. He said the proposed building could not be compared to any other building in the immediate vicinity,. pointing out the small Edmonds Automotive building next door; and the Floral Center which is lower. , He said there was no consideration of uses around this building at the ADB meetings. He said the business space.m this building occupies 34%. Although Councilmembers have stated they favor maintaining building heights, if the Council approves this application, he assumed they supported 30 -foot building heights with modulation. COUNCILMEMBER EARLING MOVED, SECONDED BY COUNCIL PRESIDENT PRO TEM VAN HOLLEBEKE, TO EXTEND THE MEETING FOR 15 MINUTES. MOTION CARRIED. City Council Approved Minutes December 7; 1999 Page 24 Darrell Marmean, 216 4`h Avenue N, Edmonds, who attended the five meetings regarding this issue during the past year, was concerned about the direction and what this proposal did to the character of downtown Edmonds. When walking through Edmonds, he observed it is a 2 -story town. The 25 -foot height restriction in the code is intended to retain that scale. The 5 feet was added to allow some freedom in design, not to encourage the development of 30 -foot buildings. He said although the proposed building was beautiful, it did not fit the scale of Edmonds. Councilmember Plunkett asked Mr. Bullock to describe the advertising of ADB meetings. Mr. Bullock explained all meetings were advertised but advertising may be as simple as posting the agenda at the library and the Public Safety building. The only time adjacent property owners are notified is when a public hearing is being held. He said that noticing is similar to what is done by the City Clerk for public hearings before the City Council. He agreed there were several meetings Mr. Spee attended that were advertised and posted in public areas but adjacent property owners were not specifically notified because they were not public hearings. Mayor Pro Tem Miller remanded the matter to Council for deliberation. Councilmernber White observed the proposed building was an attractive building and would not block views as the Floral Art Center is across the street. He expressed concern with what the Council was communicating to the ADB and what policy the Council was to follow. He said this is a 27 -foot high building with a modulated roof design at 28 and 29 feet and no part of the building was 25 feet. The code states the maximum height limit is 25 feet and the roof may only extend 5 feet above the stated height limit if certain conditions are met. The examples of modulated roof design begin at 25 feet and modulations extend to 30 feet. The proposed building is 27 feet with a modulated design that extends as high as 30 feet. He was uncertain if that was the message the Council wished to convey and did not believe the intent of the code was 30 -foot high buildings that are modulated downward. He said if that was the policy the Council wished to pursue, he would not support it. He said although he liked the project, he felt the Council needed to indicate to the ADB what the height limits are. Council President Pro Tem Van Hollebeke said Mr. Spee has presented his project through an exceedingly long process, attempting to comply with the City's code and staff and the ADB's interpretation of the code. He agreed page 67 of the Council packet indicated pictorial examples in the code but the verbiage did not state the modulation must initiate at 25 feet, only that rooflines that exceed 25 feet must be modulated. He felt this was a classic example of what the ADB, in their interpretation of the code, was attempting to accomplish — a beautiful, interesting building. He did not support the appeal. COUNCIL PRESIDENT PRO TEM VAN HOLLEBEKE MOVED TO UPHOLD THE ADB DECISION AND ALLOW THIS PROJECT. MOTION DIED FOR LACK OF A SECOND. Councilmember White said the question remains whether the interpretation was correct and was the. interpretation that was intended when the modulated roof concept was enacted. Councilmember White said it was not what he expected. He said the Council would clearly establish policy via this decision — does the Council establish policy that allows buildings to be 27-30 feet in height or was the intent to set a limit of 25 feet and allow higher modulation for an interesting fa9ade. Council President Pro Tem Van Hollebeke directed attention to the fact that the code allows a building 25 feet with a pitched roof up to 30 feet and it could be built from property line to property line. He pointed out that is much of what exists in Edmonds, big boxes that block views because they are as high as 30 feet with a .pitched roof. The proposed building is shorter than would be allowed if the applicant chose to have a pitched roof, the applicant gave up floor space by not building to the property line and City Council Approved Minutes December 7, 1999 Page 25 the applicant has followed staff and the ADB's recommendations regarding modulation. Council President Pro Tem Van Hollebeke said if the project was to be thrown out, it should have been thrown out two years ago. Councilmember Haakenson commented the building is gorgeous, adds to the neighborhood and it is evident a lot . of work has been done to make it not be a boxy building. Although, he shared Councilmember White's concern with the process. He said the staff report indicated because the ADB approved the modulated design, the roof could rise up to 30 feet from the average grade. 'Staff has indicated that is their interpretation of the code. He said not knowing how to interpret the code was frustrating to the ADB. He agreed if this interpretation was not what the majority of the Council had in mind, the interpretation needed to be changed. However, he was not certain tonight's, project was the time to do that as it would penalize this developer. He pointed out there are numerous examples of buildings constructed similar to the center example of modulated roof design (page 68 of the Council packet). He said Mr. Spee's proposal was a great change in the design to accommodate staff's interpretation of the code. Councilmember White said to adhere to the interpretation that he initially had invites ugly buildings and the only feasible option is a square building with a pitched roof. He agreed this was an issue the Council needed to revisit to determine if that was the direction the Council wants to go. He said it was unreasonable for staff to make an interpretation for the last two years and then reverse it for this applicant.. COUNCILMEMBER WHITE MOVED, SECONDED BY COUNCIL PRESIDENT PRO TEM VAN HOLLEBEKE, TO DENY THE APPEAL AND UPHOLD THE ADB DECISION. Councilmember Earling agreed the Council needed to revisit this issue. He agreed the proposed building was a marvelous project and would add a new character to the architecture in the City. Regarding whether heights begin at 25 feet and go up or begin at 30 and go down, he said the Council could back away from staff's interpretation of the policy. The issue has been created by the way the code is being interpreted and the policy may need to be reviewed again. MOTION CARRIED, COUNCILMEMBER NORDQUIST OPPOSED. Councilmember Haakenson asked the Community Services Committee to consider this issue at their January meeting. (Council President Pro Tem Van Hollebeke left the meeting at 11:25 p.m.) 8. AUDIENCE COMMENTS Darrell Marmean, 216 4" Avenue N, Edmonds, said residents who do not receive a flyer in the mail do ADB Agendas not know what the ADB agenda includes. He understood the cost of mailings regarding meetings would be prohibitive, and suggested posting the property to allow better notification. Regarding 25 foot versus uilding 30 foot height limits, he pointed out the decision made tonight happened to be for a building that was Height ' very attractive but pointed out the next building may not be attractive. Now instead of a town with 2 - story buildings with different shaped peaks, there will be 3 -story box buildings with flat tops. utgoing Rutledge, 7101 Lake Ballinger Way, Edmonds, observing this would be his last opportunity for laded public comment this year due to the cancellation of the December 21 meeting, thanked Council President fficials Pro Tem Van Hollebeke and Councilmember Nordquist and Mayor Fahey for doing a good job and hoped they would continue to provide service to the City. City Council Approved Minutes December 7, 1999 Page 26 Jim Mallonee, 217 5t' Avenue N, Unit C, Edmonds, said although he appreciated the democratic process, he did not agree with the outcome. He said the decision would have a bearing on the people that come to live in Edmonds. He said he was attracted to his current home by the view of the. ferry, which he will no longer have. He said his next step would be to determine how to be compensated for the loss in property value via his attorney. He said the decision has changed Edmonds into a city that is different from what many expected and results in a loss of some of the city's uniqueness. He said if he had known this would happen, he would not have purchased a home in that location. Appreciation Ray Albano, 20916 76th Avenue W, Edmonds, said he came to the Council meeting to honor £Elected Councilmember Nordquist who he and Edmonds have appreciated for over 30 years. Mr. Albano said Officials Councilmember Nordquist deserved more than just a plaque as he served Edmonds by letting action speak louder than words. Mr. Albano referred to Councilmember Nordquist's accomplishments including the Senior Center. Mr. Albano expressed his appreciation to Councilmembers Haakenson and Earling for their efforts on EMS, to Councilmember White for his legal experience when representing the people, to Councilmember Plunkett for being an advocate, and to Mayor Pro Tem Miller who has done a good job as Council President. He summarized that although he disagreed with each Councilmember several times, anyone who runs for public office should be appreciated. uilding Roger Hertrich, 1020 Puget Drive, Edmonds, said the Council ignored the Comprehensive Plan in its eight decision. He said the citizens have spoken out about 25 foot building heights and although Council candidates all were in favor of 25 -foot building heights, he questioned why that preference was not evident in tonight's decision. 9. MAYOR'S REPORT Mayor Pro Tem Miller had no report. 10. COUNCIL REPORT Regional Councilmember Nordquist referred to a letter from King County Executive Ron Sims regarding the new Treatment regional wastewater plant for north Lake Washington residents and urged the Council to follow this issue Plant due to the reference to locating a treatment plant in north King County or South Snohomish County. Regarding the decision on the Mallonee appeal, Councilmember Nordquist pointed out the ADB minutes reflect there was a lot of uncertainty by the ADB and perhaps staff should have identified the problem for the Council. He encouraged closer monitoring of the minutes to identify such problems. He reported Chambers Cable was carrying the agenda for the previous week's meeting. Councilmember Nordquist asked if the new fire engine had been received. Mayor Pro Tem Miller answered it is still being built. With no further business, the Council meeting was adjourned at 11:38 p.m. BARBARA S. FAHEY, MAYOR7-- SANDRA S. CHASE, CITY CLERK City Council Approved Minutes December 7, 1999 Page 27 AGENDA. EDMONDS CITY COUNCIL Plaza Meeting Room - Library Building 650 Main Street 7:00 -10:00 p.m. DECEMBER 7, 1999 SPECIAL MEETING 1 6:30 P.M. - INTERVIEW OF APPLICANT FOR THE CITY COUNCIL VACANCY - POSITION NO.2 7:00 P.M. - CALL TO ORDER FLAG SALUTE 1. APPROVAL OF AGENDA 2. CONSENT AGENDA ITEMS (A) ROLL CALL (B) APPROVAL OF CITY COUNCIL MEETING MINUTES OF NOVEMBER 15, 1999 (C) APPROVAL OF CITY COUNCIL MEETING MINUTES OF NOVEMBER 23,1999 (D) APPROVAL OF CITY COUNCIL MEETING MINUTES OF NOVEMBER 30,1999 (E) APPROVAL OF CLAIM WARRANTS #35903 THROUGH #37589 FOR THE WEEK OF NOVEMBER 22, 1999, 'IN THE AMOUNT OF $552,349.76. APPROVAL OF CLAIM WARRANTS #35906 THROUGH #37713 FOR THE WEEK OF NOVEMBER 29, 1999, IN THE AMOUNT OF $240,668.92. APPROVAL OF PAYROLL WARRANTS #26860 THROUGH #26637 FOR THE PERIOD NOVEMBER 16 THROUGH NOVEMBER 30, 1999, IN THE AMOUNT OF $340,057.38. (F) UPDATE ON HIGHWAY 99 PROJECT (G) REPORT ON FINAL CONSTRUCTION COSTS FOR THE MEADOWDALE STORM DRAINAGE IMPROVEMENTS PROJECT AND COUNCIL ACCEPTANCE OF PROJECT (H) REPORT ON BIDS RECEIVED ON NOVEMBER 2, 1999, FOR THE MARINA BEACH PLAY STRUCTURE REPLACEMENT (1) AUTHORIZATION TO PURCHASE A MILLCREEK MODEL TD 75 TURF TOPDRESSER (J) AUTHORIZATION FOR MAYOR TO SIGN RENEWAL OF OFFICE -SUPPLIES, FURNISHINGS, EQUIPMENT, AND PRINTING PURCHASING AGREEMENT WITH LUND'S OFFICE ESSENTIALS (K) AUTHORIZATION FOR MAYOR TO SIGN PROFESSIONAL SERVICES AGREEMENT WITH JEANNIE DINES FOR MINUTE TAKING SERVICES (L) AUTHORIZATION FOR MAYOR TO SIGN PROFESSIONAL SERVICES AGREEMENT WITH BARKER LANDSCAPE ARCHITECTS, P.S. FOR DESIGN/CONSTRUCTION OBSERVATION FOR BRACKETT'S LANDING NORTH BULKHEAD REPAIR PROJECT IN THE AMOUNT OF $12,000 (M) PROPOSED ORDINANCE AMENDING THE PROVISIONS OF EDMONDS COMMUNITY DEVELOPMENT CODE SECTION 17.40.010(C) TO LIMIT THE APPLICATION OF THE CITY'S ABATEMENT PROCESS TO NONCONFORMING COMMERCIAL, BUSINESS AND INDUSTRIAL USES LOCATED IN RESIDENTIAL ZONES, AND DIRECTING DEFINITION OF COMMERCIAL, BUSINESS AND INDUSTRIAL USES TO THE PLANNING BOARD FOR RECOMMENDATION 3. (45 Min.) PUBLIC HEARING ON THE FINAL ASSESSMENT ROLL FOR PERRINVILLE SANITARY SEWER LOCAL IMPROVEMENT DISTRICT (LID).215 CITY COUNCIL MEETING AGENDA DECEMBER 7,1999 Page 2 ` 4. (30 Min.) PUBLIC HEARING ON THE FINAL ASSESSMENT ROLL FOR NORTH PERRINVILLE SANITARY SEWER LOCAL IMPROVEMENT DISTRICT (LID) 216 5. (20 Min.) FINAL PUBLIC HEARING ON THE 2000 BUDGET 6. (20 Min.) CLOSED RECORD APPEAL MEETING — APPEAL OF THE HEARING EXAMINER'S DECISION TO DENY THE APPLICANT'S/APPELLANT'S TWO VARIANCE REQUESTS FILED UNDER FILE NO. V-99- 164: 1) A VARIANCE TO REDUCE THE REQUIRED REAR -YARD SETBACK FROM 15 -FEET TO 6 - FEET FOR THE CONSTRUCTION OF A NEW CARPORT STRUCTURE; AND 2) A VARIANCE TO INCREASE THE MAXIMUM FENCE HEIGHT FROM 6 -FEET TO 7 -FEET ABOVE GRADE TO ALLOW THE CONSTRUCTION OF A TRELLIS ON TOP OF A FENCE. (Appellant: Douglas Herman / File No. AP -99-208 /Applicant: Douglas Herman / File No. V-99-164) 7. (40 Min.) CLOSED RECORD APPEAL MEETING (CONTINUED FROM NOVEMBER 23, 1999) — APPEAL OF THE ARCHITECTURAL DESIGN BOARD DECISION TO APPROVE AN APPLICATION BY DOUGLAS SPEE FOR A MIXED-USE BUILDING INCORPORATING COMMERCIAL USES AND PARKING ON THE FIRST - FLOOR AND 18 RESIDENTIAL UNITS ON THE 2ND AND 3RD FLOORS. THE DEVELOPMENT ALSO INCLUDES AN UNDERGROUND PARKING GARAGE. THE SUBJECT PROPERTY IS LOCATED AT 307 BELL STREET AND 210 3RD AVENUE NORTH AND IS ZONED "COMMUNITY BUSINESS -BC." (Appellant: James A. Mallonee / File No. AP -99-201 / Applicant: Douglas Spee / File No. ADB -96- 191) 8. AUDIENCE COMMENTS.(3 Minute Limit Per Person) .9.. (5 Min.) MAYOR'S REPORT 10. (15 Min.) COUNCIL REPORTS 1 Parking and meeting rooms are accessible for persons with disabilities. Contact the City Clerk at (425) 771-0245 with 24 hours advance notice for special accommodations. The Council Agenda appears on Chambers Cable, Channel 46. Delayed telecast of this meeting appears the following Wednesday at noon and 7: 00 p.m., as well as, Friday and Monday at noon on Channel 46.