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Cm130625EDMONDS CITY COUNCIL APPROVED MINUTES June 25, 2013 The Edmonds City Council meeting was called to order at 6:30 p.m. by Mayor Earling in the Council Chambers, 250 5th Avenue North, Edmonds. ELECTED OFFICIALS PRESENT Dave Earling, Mayor Lora Petso, Council President Strom Peterson, Councilmember Joan Bloom, Councilmember Kristiana Johnson, Councilmember Adrienne Fraley-Monillas, Councilmember Diane Buckshnis, Councilmember ELECTED OFFICIALS PRESENT Frank Yamamoto, Councilmember 1. ROLL CALL STAFF PRESENT Stephen Clifton, Community Services/Economic Development Director Phil Williams, Public Works Director Roger Neumaier, Finance Director Carrie Hite, Parks & Recreation Director Rob Chave, Acting Development Services Dir. Jerry Shuster, Stormwater Eng. Program Mgr. Jeff Taraday, City Attorney Sandy Chase, City Clerk Jana Spellman, Senior Executive Council Asst. Jeannie Dines, Recorder City Clerk Sandy Chase called the roll. All elected officials were present with the exception of Councilmember Yamamoto. CONVENE IN EXECUTIVE SESSION REGARDING A REAL ESTATE MATTER PER RCW 42.30.110(1)(c). At 6:32 p.m., Mayor Earling announced that the City Council would meet in executive session regarding a real estate matter per RCW 42.30.110(1)(c). He stated that the executive session was scheduled to last approximately 20 minutes and would be held in the Jury Meeting Room, located in the Public Safety Complex. He announced action may occur in open session as a result of meeting in executive session. Elected officials present at the executive session were: Mayor Earling, and Councilmembers Johnson, Fraley-Monillas, Buckshnis, Peterson, Petso and Bloom. Others present were City Attorney Jeff Taraday, Community Services/Economic Development Director Stephen Clifton, Senior Planner Kernen Lien, and City Clerk Sandy Chase. At 6:55 p.m., Mayor Earling announced to the public present in the Council Chambers that an additional 10 minutes would be required in executive session. The executive session concluded at 7:05 p.m. Mayor Earling reconvened the regular City Council meeting at 7:06 p.m. and led the flag salute. 3. APPROVAL OF AGENDA Council President Petso requested Item 15, Discussion: Edmonds City Code Chapter 2 Revisions, be moved to the Public Safety and Personnel Committee. COUNCIL PRESIDENT PETSO MOVED, SECONDED BY COUNCILMEMBER BUCKSHNIS, TO APPROVE THE AGENDA AS AMENDED. MOTION CARRIED UNANIMOUSLY. Edmonds City Council Approved Minutes June 25, 2013 Page 1 APPROVAL OF CONSENT AGENDA ITEMS COUNCIL PRESIDENT PETSO MOVED, SECONDED BY COUNCILMEMBER FRALEY- MONILLAS, TO APPROVE THE CONSENT AGENDA. MOTION CARRIED UNANIMOUSLY. The agenda items approved are as follows: A. APPROVAL OF CITY COUNCIL MEETING MINUTES OF JUNE 18, 2013. B. APPROVAL OF CLAIM CHECKS #202722 THROUGH #202855 DATED JUNE 20, 2013 FOR $738,490.73. APPROVAL OF PAYROLL DIRECT DEPOSIT & CHECKS #60245 THROUGH #60266 FOR $454,303.81, BENEFIT CHECKS #60267 THROUGH #60274 AND WIRE PAYMENTS OF $199,913.22 FOR THE PERIOD JUNE 1, 2013 THROUGH JUNE 15, 2013. C. APPROVAL OF CLAIM CHECK #202856 DATED JUNE 21, 2013 FOR $58,176.97. APPROVAL OF PAYROLL CHECK #60275 DATED JUNE 21, 2013 FOR $28,050.00. D. AUTHORIZATION TO CONTRACT WITH JAMES G. MURPHY TO SELL A SURPLUS CITY VEHICLE. AUDIENCE COMMENTS Valerie Stewart, Edmonds, referred to Agenda Item 14, Using Rain Gardens for Stormwater Management, and described her experience with putting rain gardens in her yard. Rain gardens now handle 100% of the rain water off the roof. When investigating development of the adjacent, downhill lot, she learned one of the downspouts was running onto that land. When her house was built in the 1930s it was in the middle of a forested area with many native plants and could handle the stormwater but no longer could due to development in the area. Instead of a storm sewer, rain gardens were designed for the front and backyard and a rain barrel is used for irrigation. Her rain gardens are beautiful; they filter toxins and have handled any storm event to date. A couple of Councilmembers have looked at her rain gardens, they were on the Snohomish County Task Force LID tour and they are the eighth rain gardens to be registered. She encouraged the public to look into the WSU Extension handbook for Western Washington Homeowners that describes how to make a rain garden. Roger Hertrich, Edmonds, relayed a citizen's concern with segways being driven on sidewalks. There is a segway rental facility in the area and a number are being used on sidewalks. This citizen's wife has a difficult time with rough sideways and feels threatened by segways speeding on the sidewalks. He recommended the City police the use of segways, have a discussion with the business and/or give direction regarding the use of skateboards, bicycles and segways on sidewalks in the downtown area. Next, Mr. Hertrich referred to last week's TIP presentation, reiterating his suggestion for the Council to allocate more money to the SR 104 study. He suggested Councilmembers imagine themselves as a shopper or visitor to the Westgate area and consider how to navigate the cars backed up to Westgate waiting for the ferry, and if the terminal were moved to Unocal where there would be space for vehicular storage. Rich Demeroutis, Edmonds, viewed the City's $250,000 purchase of the property in front of Old Milltown for a park and $150,000 for renovations as an advantage for the landowner and creating a park that could be utilized by businesses. Several months ago he noticed the Cheesemonger was utilizing the area for outside dining including waiters servicing the tables. He brought it to the attention of the City's Parks & Recreation Director and assumed the situation had been be remedied. A few weeks ago he walked by and saw customers picking up trays from the Cheesemonger to eat in the park. Several people he asked said they would not sit at a table if they saw a professional dining room being operated there. Several Councilmembers responded to his concern including Councilmember Peterson, who said he has been working with City staff and believed they had reached an equitable solution. He questioned why Edmonds City Council Approved Minutes June 25, 2013 Page 2 Councilmember Peterson had standing on the property since he did not own or rent it and why he was able to utilize a park to operate his business. Apparently there is nothing in the City code to prevent this and other businesses in the area could do the same thing. He urged the City to remedy this situation, stating the park was intended to be a gathering place, not a dining room. Next, he wished Betty Mueller a happy 91st birthday today. Ms. Mueller founded the Fire Foundation and was not appreciated for her energy and the battles she raged against the City with regard to the transport fee and gambling. 6. PROCLAMATION IN RECOGNITION OF PARKS & RECREATION MONTH Mayor Earling read a proclamation declaring July 2013 as Recreation & Parks Month and presented the proclamation to Parks & Recreation Director Carrie Hite. Ms. Hite thanked the Parks crew and staff for the excellent job they do all year long, from mowing and landscaping to being stewards of the off -leash area, cleaning restrooms, providing activities at the Frances Anderson Center, softball leagues and other fitness opportunities for the community. The United States has declared July Parks & Recreation Month for over 25 years. This year's theme is Love My Parks and Recreation. A flyer was distributed to Councilmembers and available at the table in Council Chambers with ideas about what to do during the month of July to celebrate Parks & Recreation Month as well as a schedule of summer concert series. There are seven concerts in the park scheduled at City Park this year, one fewer than last year. Thanks to the Hazel Miller Foundation there will also be concerts at the Hazel Miller Plaza this summer. She encouraged the public to thank the Parks crew and recreation staff for the excellent job they do all year long. 7. PARK IMPACT FEE STUDY PUBLIC HEARING AND POSSIBLE ADOPTION Park & Recreation Director Carrie Hite recalled this subject was presented to the Council over a year ago. Staff has been working with a consultant, Randy Young, Henderson, Young and Company, who provided a complete Park Impact Fee Study and Report on April 23, 2013. After the report was delivered there were several decision points. She has contacted each Councilmember and met with the Finance Committee and Parks, Planning and Public Works Committee to discuss the decision points. Ms. Hite explained the Park Impact Fee ordinance has been distributed to the Council with proposed amendments. On Friday Mr. Young met with Community Services/Economic Development Director Stephen Clifton, Acting Development Services Director Rob Chave and her to discuss concerns with the change of use language. The change of use language in the ordinance is consistent with the Transportation Impact Fees; staff wants to do further research. If adopted tonight, the Park Impact Fee will not be effective until October 1, providing time for staff to conduct that additional research. Randy Young, Henderson, Young and Company, advised the presentation on April 23, 2013 of the draft calculations was in compliance with Washington law, specifically RCW 82.02.050. He also made a presentation to the Finance Committee and Parks, Planning and Public Works Committee on June 11, 2013. He summarized the overall method by which the Park Impact Fee was calculated, explaining he considered what Edmonds has already accomplished in developing its parks system and identified how much it would cost to maintain that same system or the cost in today's dollars to buy it again; that amount is nearly $10 million in investments. Other sources such as grant funds and local funds such as Real Estate Excise Tax would provide approximately $3 million of the investment; new development would pay the remainder. Washington law allows each new dwelling unit and new business to pay their pro rata share of the $7 million cost. The study presented in April illustrated the calculations and the amount per dwelling unit and per square foot for different types of businesses. Tonight's presentation is to determine if the Council is ready to proceed with the ordinance to ask new development to pay for a portion of the park system. The Council already made that decision for the transportation system. He recalled he conducted a Transportation Impact Fee study for the City several years ago and the Council adopted a Transportation Impact Fee. Edmonds City Council Approved Minutes June 25, 2013 Page 3 Mr. Young discussed the remaining issues: 1. Should the Park Impact Fee be charged only to residential development or should businesses also be charged a Park Impact Fee? There are 78 other cities in Washington that charge a Park Impact Fee, only a few charge new businesses development. If the Council decides to charge businesses a Park Impact Fee, only new businesses will be charged. For a new retail business, the fee is approximately $2.50/square foot; $0.70/square foot for office, compared to over $2000 for a new residential unit. If businesses are not included, the City still needs to make the $10 million investment in parks to serve the new population and residential units would pay approximately 20% more. His sense of the Council in April and at committee meetings was they supported charging a Park Impact Fee to commercial as well as residential development and the draft ordinance and draft code, specifically Section 3.36.120, reflect a commercial Park Impact Fee. 2. When should the Park Impact Fee start? Under Washington law, a City government can adopt an ordinance to be effective quickly to allow new rules to be imposed as soon as possible. His advice, based on experience in many other cities, is that it is worth waiting a few months to make the Park Impact Fee effective. The primary reason is development transactions that are currently underway will not have expected the additional cost. Most cities, and what the draft ordinance reflects, adopt a 90-100 day waiting period. This allows developers that amount of time to wrap up their application and not pay the fee. After that time, the Park Impact Fee would be charged all new development that receives a permit on or after October 1, 2013. 3. Should the new fees be enacted in full or phased? The advantage of phasing in a Park Impact Fee is it allows the development community a lower rate the first year. The disadvantage to the city government is it does not collect as much the first year. They have found the rate differential does not make a big difference in the amount of development that occurs; the discounted rate does not cause a construction boom but to some, it seems a more reasonable way to enact a new fee. Councilmembers had many different opinions regarding phasing the Park Impact Fee. The draft ordinance has a two year plan; 50% of the rate would be charged the first year (October 1, 2013 — September 30, 2014), and on October 1, 2014, the rate would be increased the remaining 50% (Section 3.36.120). He provided examples of the October 1, 2013 and October 1, 2014 rate: Development Type 50% rate Full rate Condo/Apartment —$1400 —$2800 Retail $1.24/s uare foot $2.48/s uare foot Office $0.31/s uare foot $0.62/s uare foot 4. Exemptions. State law limits exemptions to low income housing or other broad public purposes. A number of cities with Park Impact Fee have adopted exemptions for low income housing but a number of cities have not. When the City adopted its Transportation Impact Fee, a decision was made not to create an exemption for low income housing. The draft ordinance does include an exemption for low income housing built by a non-profit organization such as Habitat for Humanity. If the housing is exempt, the ordinance also includes a provision requiring they file a lien on the property for ten years so that if at any time that house or unit is flipped into profit making and the price goes above the threshold, the person who did that would owe the City that impact fee. With regard to the potential draft amendment that Ms. Hite mentioned, Mr. Young explained the current Transportation Impact Fee has a provision requiring a new house, condominium, office building or new grocery store to pay the fee; but if the use is charged, such as from a grocery store to an office building or a house to a lawyer's office, changes in use that require a permit are also subject to a Transportation Impact Fee. He and staff discussed the challenge that poses in administering the fees. A number of other Edmonds City Council Approved Minutes June 25, 2013 Page 4 cities charge fees for changes in use or expansion and a number of cities do not. Staff is discussing whether to continue that practice with the Transportation Impact Fee. The draft ordinance models the Transportation Impact Fee; a change in use or expansion requires paying an impact fee. The amendment staff proposed would continue to charge an impact fee for expansions of significant size, such as more than 10%. However, a small scale expansion would not be charged a Park Impact Fee. He relayed some other cities have stopped charging a Park Impact Fee for change in use because they found it very difficult to charge for a change of use from a low use to a high use but when that high use changed back to a low use, the business did not get a refund. There is a legitimate question of fairness and in staff s view, would be difficult to administer. Mr. Young explained the City already charges a Transportation Impact Fee and staff is used to administering it. The administration of any impact fee is not free; the annual budget will reflect the additional time to administer the fee. Staff has suggested future amendments of the fee address whether administrative fees could be recovered from the fees; they are not included in the current draft. Councilmember Buckshnis thanked Mr. Young for his easy -to -read, understandable information. She asked whether the fees could cover staff time to administer the impact fee. Mr. Young answered a number of cities and counties have elected to add either a flat dollar amount or a percentage to the fee. The funds are reserved in the impact fee account with the purpose of paying for staff administration, updating studies, consultant analysis, appraisals, etc. It is not done universally and was not included in the rate study or ordinance and he was not prepared tonight to say what that amount should be. Staff has discussed and may discuss with the Council amending the Transportation Impact Fee and Park Impact Fee ordinances to reflect that cost. Mayor Earling opened the public participation portion of the public hearing. Al Rutledge, Edmonds, was opposed to charging new businesses a Park Impact Fee. He questioned how businesses coming to Edmonds would benefit from the Park Impact Fee. He anticipated the cost of space would increase. He concluded a Park Impact Fee was not the right way to raise revenue in Edmonds. He suggested the City survey residents in the 15-20 blocks surrounding each park to ask what they want in the park. When the City makes those improvements, those residents will support a park levy. Val Stewart, Edmonds, Expressed concern with imposing additional fees on new construction, recalling the dramatic increase in the sewer and water connection fees approximately a year ago, and now a Park Impact Fee. If the Council chose to impose a Park Impact Fee, she preferred to phase the fee in over time. She suggested the Council consider a park levy where all residents are assessed a percentage based on the value of their property, noting people living in existing buildings all enjoy the parks. Park levies are popular and overwhelmingly supported by voters. She was hopeful any development she pursued on her property would not meet with any more unexpected surprises as far as costs, pointing out the importance of predictability in these uncertain times. Roger Hertrich, Edmonds, commented that he felt an impact fee was proper for new development but the City should not depend on it to cure everything or charge so much that it becomes prohibitive. Businesses produce sales tax and therefore should be promoted rather than penalized. If the Park Impact Fee were minimal, a park levy could still be pursued. He questioned how a Park Impact Fee benefits the City and suggested further discussion regarding how the money would be spent. He asked if public facilities would be charged the Park Impact Fee. He referred to language that fee payers can pay a smaller fee if they demonstrate their development will have less impact than presumed in the impact fee schedule and asked what the impact fee schedule is based on, what would constitute less impact and whether the fee would be increased if the fee payer had more impact than assumed in the fee schedule. He summarized a Park Impact Fee was reasonable but he did not want it to be so prohibitive that it discouraged development and he did not believe it belonged in the business sector. Edmonds City Council Approved Minutes June 25, 2013 Page 5 Randy Hayden, Edmonds, acknowledged parks are suffering from lack of funds. A tax on new homes was acceptable to him because residents would use the parks. He had a problem with imposing a Park Impact Fee on businesses, noting most people at a business would not use the parks. He is working with a business that needs to relocate and he is encouraging them to come to Edmonds. That business needs 15,000-20,000 square feet and the proposed Park Impact Fee would be a substantial amount. The business currently has a park next door and only about 10% of the people use the park. He anticipated imposing a Park Impact Fee on businesses would push businesses away, reducing revenue from sales tax and property tax. Hearing no further comment, Mayor Earling closed the public participation portion of the public hearing. Councilmember Fraley-Monillas asked whether the Park Impact Fee would be imposed only on new buildings. Mr. Young answered the current owner of a house, apartment, condo or business would not pay a Park Impact Fee. It is only charged on new development or, in the case of the Transportation Impact Fee, any expansion or as proposed in the amended Park Impact Fee language, expansion in excess of 10% of the existing building. The amendment also proposes no charge for a change in use with no change in square footage. He explained one of the difficulties with change of use is many changes of use do not require a permit; many cities felt it unfair to charge some changes of use an impact fee and not others. He anticipated staff will later propose eliminating a Transportation Impact Fee for a change of use. City Attorney Jeff Taraday explained eliminating change of use from the definition of development activity creates a potentially significant loophole. The Transportation Impact Fee is driven by the ITE manual and how it defines trip generation for each type of use; use is a very significant factor in the calculation of the Transportation Impact Fee. When developers understand there is no fee collected with a change of use, they will simply propose they are building something that creates a very low trip generation under the ITE manual and later change the use to something that generates much larger traffic volume. The threat is not as significant for the Park Impact Fee because they are not calculated using the ITE manual, but if a decision is made to have a parallel structure for the two impact fees, it could create a very significant loophole. He suggested the Council take that issue under advisement for a couple months while staff confers on whether to have a parallel structure for both impact fees. Mr. Young agreed with Mr. Taraday's concerns, noting a delayed effective date would allow further discussion of change of use. He observed the two principle commercial categories for the Park Impact Fee are retail and office. With regard to the Park Impact Fee, for someone to intentionally beat the system, they would build an office building which has a Park Impact Fee of $0.30/square foot versus $1.20 for retail. They would then need to turn the office into a restaurant without applying for a permit to put in a kitchen, restrooms, etc. He anticipated it would be difficult to beat the system. Councilmember Bloom referred to the example Mr. Hayden provided, observing a new business locating in an available space would not be charged a Park Impact Fee. Mr. Young agreed there is no new impact fee if the building already exists. Councilmember Fraley-Monillas recalled Mr. Young provided the Finance Committee with reasons it was appropriate for businesses to pay the Park Impact Fee. Mr. Young explained the study provides technical calculations regarding the small park usage by businesses. It is recognized that businesses' employees, customers and visitors only have incidental use of parks. There is clear proof, however, that employees visit a park for a break, exercise, lunch, etc. The data sources about when and how often that happens result in the study charging businesses a tiny percentage of what would be charged a residence. Approximately 12 of the 78 Washington cities that charge a Park Impact Fee agreed businesses benefit from the park system and charge businesses a Park Impact Fee. The impact fee amount is low. If it is accepted businesses receive some small benefit, asking them to pay a Park Impact Fee based on square footage for new space, in his experience, does not drive businesses away from communities. If it did, Edmonds City Council Approved Minutes June 25, 2013 Page 6 cities would not have a Transportation Impact Fee. The practical proof that impact fees do not discourage business is the cities with the biggest growth in business, such as Bellevue and Redmond, have some of the largest impact fees in the State. The transportation system and parks system attract businesses. Contrary to the thought that cheaper is better, better quality of life is better and that attracts businesses. Mr. Taraday referred to Councilmember Bloom's question about a new business coming to Edmonds, explaining the answer depends on what the Council decides to do with regard to change of use. If change of use is removed from development activity as the amendment proposes, it is more certain that the situation posed in Councilmember Bloom's question would not be charged an impact fee. If changes of use are development activity, then City staff in processing whatever permits are associated with that new business could potentially charge an impact fee depending on the business that previously occupied the space. For example, does the preceding business generate the same impact on the system that the new business generates. Councilmember Buckshnis asked if Mr. Taraday's concern about a loophole was only if the Transportation and Park Impact Fee had parallel structures. Mr. Taraday acknowledged it is a significantly larger loophole for transportation than parks but a potential loophole in both. Councilmember Buckshnis asked if the goal was to have the impact fee structures mirror each other. Mr. Taraday answered that is up to the Council Mr. Young commented for the businesses and staff who administer the impact fees, there is a lot to be said for consistency. His understanding of Mr. Taraday's advice was to adopt the ordinance as drafted without the amendment to preserve that consistency. Staff will then have an opportunity to research and discuss this point further and return to the Council, possibly with both impact fees, and the loophole could be addressed at that time. Mr. Young pointed out the rates in the ordinance had not been corrected to reflect a 20% lower rate for residential with the inclusion of a commercial Park Impact Fee. He provided the following revision to the rates in Section 3.36.120: Housing Type Incorrect Rate 1011113 — 9/30/14 Corrected Rate 1011113 — 9/30/14 Incorrect Rate 10/1/14 Corrected Rate 10/1/14 Single Family $1,660.19 $1,367.03 $3,320.38 $2,734.05 Multi -Family $1,421.01 $1,170.08 $2,842.02 $2,340.16 Councilmember Peterson asked whether any neighboring cities such as Lynnwood, Mountlake Terrace, or Shoreline had a Park Impact Fee and if so, did they charge businesses. Mr. Young responded Mukilteo has a residential Park Impact Fee of $2,438 and does not have a commercial Park Impact Fee. Redmond, Mountlake Terrace, Arlington, Tukwila, Sedro Woolley, Buckley, Burlington, Arlington, Sumner, Ephrata and Yelm charge a commercial Park Impact Fee. Due to the amount of time spent discussing this item and the number of items remaining on the agenda, Mayor Earling suggested the Council consider moving this to a future meeting. Main Motion COUNCILMEMBER BUCKSHNIS MOVED, SECONDED BY COUNCILMEMBER FRALEY- MONILLAS, TO ADOPT ORDINANCE NO. 3928, AN ORDINANCE OF THE CITY OF EDMONDS, WASHINGTON, ADOPTING A NEW CHAPTER 3.36 TO THE EDMONDS CITY CODE ENTITLED "PARK IMPACT FEES", PROVIDING FOR THE IMPOSITION AND COLLECTION OF SUCH FEES UPON NEW DEVELOPMENT, AND PROVIDING FOR THE CALCULATION, USAGE AND GENERAL ADMINISTRATION OF SUCH A FEE SYSTEM, WITH THE OCTOBER 1, 2013 START DATE, AN EXEMPTION FOR LOW INCOME BUILT BY A NON-PROFIT, A TWO-YEAR PHASE -IN, AND INCLUDING BOTH RESIDENTIAL AND COMMERCIAL. Edmonds City Council Approved Minutes June 25, 2013 Page 7 Councilmember Peterson stated he did not support charging a commercial Park Impact Fee. There has been discussion that businesses on Highway 99 are the financial center and revenue generator for the City. Edmonds is in direct competition with Lynnwood; when a decision is being made to build a new building in Edmonds or across the street in Lynnwood, he wanted Edmonds to have every advantage. He anticipated the sales tax generated would make up for the possible loss in Park Impact Fees. He preferred the Park Impact Fee for single family and multi -family to be phased in over three years, particularly in view of needed but significant increases in fees for new construction. Councilmember Fraley-Monillas relayed her support for the motion. She understood Councilmember Peterson's concerns about businesses on Highway 99, pointing out most of those businesses were large corporation -type businesses and medical facilities and they are a good way to generate funds via a Park Impact Fee. Further, there are a number of parks in that area that will be used by the staff and patrons of those businesses. Councilmember Peterson asked if the motion included the amendment that was distributed tonight. Councilmember Buckshnis said it did not. Mr. Taraday pointed out the motion also does not include the revised numbers read by Mr. Young. Amendment #1 COUNCIL PRESIDENT PETSO MOVED, SECONDED BY COUNCILMEMBER JOHNSON, TO AMEND THE MOTION TO INCLUDE THE CORRECTED NUMBERS PROVIDED BY MR. YOUNG. Vote on Amendment #1 MOTION CARRIED UNANIMOUSLY. Vote on Main Motion as Amended MOTION CARRIED (5-1), COUNCILMEMBER PETERSON VOTING NO. PUBLIC HEARING ON INTERIM ORDINANCE NO. 3921 - ADOPTING AMENDMENTS TO ZONING REGULATIONS TO ALLOW PUBLIC MARKETS IN THE BC. BD AND CG ZONES. Community Services/Economic Development Director Stephen Clifton explained the Council approved Interim Ordinance No. 3921 on May 21, 2013, adopting amendments to ECDC Title 16 and 21. The ordinance is good for six months as long as the Council conducts a hearing within 60 days; this hearing meets that obligation. The Planning Board also concluded a public workshop on May 22, 2013 followed by a public hearing on June 12, 2013 to review and discuss the interim ordinance. Ordinance No. 3922 related to amending ECDC 4.90 regarding licensing was approved by the Council on May 21, 2013 and is included in the Council packet for reference purposes only and does not require a public hearing. The Planning Board recommendation is to support Interim Ordinance No. 3921, subject to recommended amendments contained in Attachment 1 of the Council packet. The most significant amendment is related to a concern raised by a Councilmember, a public market adjacent to a single family would need to be contained entirely within a building. Mr. Clifton explained the Edmonds Historical Museum approached the City last fall about opening a produce and food market in another location. Upon the review of existing regulations applicable to such a proposal, City staff found numerous issues in the existing code. The current regulations would preclude the proposed produce and farmers market from operating Wednesday evenings during any month of the year and existing regulations conflict with current operation of the Edmonds Historical Museum Garden and Summer Market that takes place each Saturday because the current code restricts operations to the months of July, August and September. The code contains a definition for seasonal farmers market but it Edmonds City Council Approved Minutes June 25, 2013 Page 8 only allows them to operate May — September. Existing regulations prohibit any other open air market to exist other than what exists today as well as precludes the ability to establish a year-round farmers market. Mr. Clifton reviewed the goals and how the amendments addressed each goal: Goal #1: Create one definition that would be located in ECDC Title 21 - Definitions that apply to community open-air markets, farmers' markets, seasonal farmers' markets, or public markets. Amendments: The term Community Oriented Open -Air Market has been deleted from ECC Section 4.90.010 and Seasonal Farmers Market has been deleted from ECDC Title 21. A new term called Public Market has been added as ECDC 21.80.103 and will allow: • a stand-alone produce only farmers market • a farmers market • community oriented outdoor market Goal #2: Allow public markets to operate as open-air activities, within buildings..... or both Amendments: The term also allows the use to take place indoors or outdoors. Goal #3: Allow public markets to operate in public rights of way, private property, and public property not located within public rights of way Amendments: Amendments to ECC Section 4.90.020(C) reference operations that might take place in public rights of way, private property, and/or public property not located within public rights of way. Goal #4: Establish operational hours to minimize disruption to traffic, residential properties, etc. Amendments: Establishes hours of operations: - Activities of the market shall be limited to daylight hours on Saturday and Sunday within public rights of way. • Extended hours are allowed up to 10 p.m if the market takes place outdoors on private property or public property not located within public rights of way. • Operational hours related to activities of the market are not so limited when the market takes place within a fully enclosed building. Goal #5: Allow public markets to operate for longer periods of time, e.g., four months, 8 months, or year-round Amendments: Proposed amendments to ECDC Titles 16 and 21, and adopted amendments to ECC Chapter 4.90, do not place restrictions on what months a public market can operate, thus allowing a market to operate year-round. Goal #6: Remove provisions of ECC Chapter 4.90, Section 4.90.060, that are more land use oriented and move them to ECDC Sections 16.43 and 16.50 Amendments: ECC Section 4.90.060 has been deleted and relocated to ECDC Title 16. This language relates more to land use, i.e., temporary use status. Mr. Clifton advised the ordinance applies to the Strategic Action Plan, finding a way to create a year- round market. For the public market on the Salish Crossing property at the intersection of Dayton & SR 104, the process was flawless and smooth and the market is now in operation. Council President Petso asked if there was a recommended action to incorporate the Planning Board's amendments or only hold a public hearing. Mr. Clifton suggested the Council hold the public hearing and then make a decision. Councilmember Bloom referred to Section 11 of the ordinance that restricted the duration of a public market to six months. Mr. Clifton advised that was only in the interim ordinance. If the Council holds the hearing and approves a permanent ordinance, the six month provision would be removed. Mayor Earling opened the public participation portion of the public hearing. Edmonds City Council Approved Minutes June 25, 2013 Page 9 Al Rutledge, Edmonds, questioned whether a property owner who has been using their property in the past to sell items would be grandfathered. Fay May, Edmonds, expressed support for adoption of the ordinance, noting it will help things run smoothly and it is well thought out. Hearing no further comment, Mayor Earling closed the public participation portion of the public hearing. Mr. Taraday advised Ordinance No. 3921 was adopted as an interim zoning ordinance; a public hearing was required within 60 days. It was his understanding this was the public hearing required by State law within 60 days of the adoption of the interim zoning ordinance. He did not realize it was intended to be combined with the permanent adoption of the zoning regulations for public markets. Mr. Clifton pointed out the packet contained the ordinance with the amendments recommended by the Planning Board. Council President Petso suggested rather than a motion to adopt the ordinance, there be a motion to ask the City Attorney to draft an ordinance for next week's Consent Agenda that includes the Planning Board's recommendations and not include Section 11. COUNCIL PRESIDENT PETSO MOVED, SECONDED BY COUNCILMEMBER BUCKSHNIS, TO DIRECT THE CITY ATTORNEY TO DRAFT AN ORDINANCE FOR NEXT WEEK'S CONSENT AGENDA THAT INCORPORATES THE CHANGES RECOMMENDED BY THE PLANNING BOARD AND DOES NOT INCLUDE SECTION 11. MOTION CARRIED UNANIMOUSLY. PLANNING BOARD QUARTERLY REPORT Planning Board Vice Chair Valerie Stewart reported the Planning Board (PB) has met 5 times since the last Quarterly Report was delivered on March 26, 2013. The PB meets on the 2nd and 4tn Wednesday of each month at 7:00 p.m. in Council Chambers unless otherwise noted. Meetings are open to the public and citizens are encouraged to attend so concerns and comments are addressed early on and incorporated into discussions before making recommendations to City Council. The PB is a group of volunteer citizens who review findings, research, conduct public hearings and discuss matters relating to land use. The PB serves in an advisory capacity to the Mayor and City Council in regional and local planning issues and ultimately passes on recommendations to City Council for consideration. Vice Chair Stewart provided the following highlights of recent PB meetings: 1) Public hearing on proposed code amendment to increase the time frame for validity of preliminary short plat approval In February, the PB discussed this item and proposed to extend the time frame for preliminary short plat approval to be consistent with the State's time frame for formal subdivision approval, including a provision to address applications that have already expired. The preliminary short plat approval would expire at the end of seven years if the preliminary short plat approval was issued on or before 12-31-13 and at the end of five years if the preliminary short plat approval was issued on or after 01-01-14. The time frame would then switch back to five years at the beginning of 2014, which is one year sooner than what the State regulations afford to formal plats. Also included was a provision for extending the time limit for preliminary short plats that would have expired within the past couple of years, giving applicants two additional years from the effective date of the ordinance to obtain final approval. The intent of this change was to provide builders additional time to complete projects that have been affected by the economic downturn. 2) Public hearing of proposed rezone of parcel (22133 76th Ave. W) from contract General Commercial (CG) to General Commercial (CG2) and a portion of another parcel (22121 76th Ave. W) from Residential Multifamily (RM-2.4) to General Commercial (CG2) This rezone is proposed in order to correct two errors on the official zoning map that dated back to 1995. This rezone, as recommended by the PB, brings the parcels into better alignment with the Comprehensive Plan and the CG2 zoning which has surrounded the parcels since 1995. Edmonds City Council Approved Minutes June 25, 2013 Page 10 3) Highway 99 Corridor Update The following projects are a few that are likely to come to the attention of the PB: • New Swedish cancer treatment center, located at 21605 — 76th Avenue involves fixture planning with the City. Community Health Centers of Snohomish County is proposing to construct a new 25,000 square foot facility. The building will be constructed to meet LEED Silver standards. • Edmonds Gateway/SR99 Revitalization Project - Phase 1: with the successful transformation of Highway 99 within the Shoreline City limits, the opportunity and precedent exists to extend similar safety, capacity, and aesthetic improvements to that portion of Highway 99 within the City limits of Edmonds. The City will create a recognizable "Gateway" that identifies this portion of Highway 99 as Edmonds from both the North and South. • 228th St. SW Corridor Improvement Project: a new roadway will be added from Highway 99 to 76th Ave W creating a new E/W connection from Highway 99 to 1-5 and Mountlake Terrace Park-n-Ride. The City has been instrumental in securing significant funding for this project through the Federal Highway Administration grant programs. 4) Parks, Recreation, and Cultural Services Quarterly Update The PB is also a Parks Board and is often called upon to review and discuss matters relating to parks. The following are a just a few of the many projects underway: • The Edmonds Marsh: The City recently contracted with Earthcorps (formerly the work of People for Puget Sound) to manage the phases of the Edmonds Marsh rehabilitation efforts. A major goal of this effort is day lighting Willow Creek. $100,000 funding has been secured and additional funding is being sought. • Yost Pool: The goal this year is to replace the boiler with a more energy efficient system barring any unforeseen emergency repairs. • City Park: the department is planning to improve, update, and diversify the outdated play features at our key downtown community park. The redesign introduces a water spray play element and replaces aged play structures with interactive, kinetic, and inclusive play structures. The project is scheduled to be completed by summer 2014. • Dayton Street Plaza: the design is complete and work is scheduled in Fall of 2013. • SR 104 Mini Park: the park naming process is underway for this park. A PB sub -committee is reviewing entries for the full PB to consider at our next meeting. • Park Recreation and Open Space Plan (PROS): The current plan was adopted in 2008, and expires in May 2014. A committee has been selected to be involved in the planning which includes me as our PB representative. The full PB will play a major role in the process of review, comments, public hearings, approval and recommendation to City Council. • Edmonds Municipal Code regarding dogs: EMC prohibits dogs on the beachfront walkways. This will be up for review. • Community Garden: The Parks Department has set aside $200,000 in the upcoming budget for acquisition of land to establish this. The goal for 2013 is to secure land to develop the garden for 2014. • Esperance Park: The Parks Department is having conversations with Snohomish County about the City of Edmonds acquiring ownership of Esperance Park. • Metropolitan Park District/Park Levy Exploratory Committee: This Committee was charged with gathering and interpreting information about the pros and cons of a Metropolitan Park District; exploring goals, issues, needs and priorities of Edmonds Parks and Recreation system; and soliciting input from the community. Board member Lovell sits on this committee. 5) Edmonds Way Zoning The PB reviewed new zoning, BC-EW and RM-EW, along Edmonds Way at two meetings. In light of the recent Compass development there, the PB discussed potential changes to the zoning to ensure a better outcome. Concerns were expressed by the City Council specifically related to the height and setback requirements, incentives for low -impact development, ground floor Edmonds City Council Approved Minutes June 25, 2013 Page 11 commercial requirements and landscaping requirements. The PB previously raised questions about the relative width of the landscape strips, sidewalks, etc., particularly noting the close proximity of the new Compass development to Edmonds Way. The PB felt that a greater setback would be preferable. The PB also agreed that the code language should have more depth in regards to the incentives required to obtain the additional building height. They talked about whether it would be appropriate to incorporate design standards into the language similar to those found in BD zones to make development more appealing. There was additional discussion about LEED certification, bicycle storage, preferred building materials, and the inclusion of affordable housing. Staff will draft proposed amendments and bring this back for a public hearing in July. 6) Public Markets The City Council approved an Interim Ordinance on May 21, 2013 adopting amendments to ECDC Titles 16 and 21 which would allow Public Markets in the BC, BD and CG Zones.; the ordinance is good for a period of up to six months. The PB conducted a public workshop on May 22, 2013 to review and discuss the interim ordinance and conducted a public hearing on June 12, 2013. The PB subsequently recommended proposed amendments to City Council involving zoning regulations which would allow Public Markets in the BC, BD and CG zones. The City Council has just conducted a public hearing on this proposed ordinance tonight. This ordinance relates to the following Strategic Plan actions: • Plan Action 2a.2 (33) Farmers'/Public Market. "Expand into a year-round activity with available all-weather structures, available parking, and increased visibility to attract out - of -area customers and tourists." • Plan Action lb.5 (21) Antique Mall aka Salish Crossing. "Encourage packaging the Safeway/Antique Mall aka Salish Crossing and nearby properties for the purpose of enhancing redevelopment opportunities of this significant gateway site." 7) Incentive zoning opportunities and Highway 99 The PB discussed Highway 99 zoning incentives/issues. Highway 99 was prominently mentioned in the Strategic Plan as an opportunity for some initiatives. The PB considered ways to include 'green building incentives in regulations along with opportunities to encourage transit oriented development in association with SWIFT bus rapid transit. The idea is to provide flexibility and more options to developers. Board Member Lovell and Chair Reed agreed to serve on the Subcommittee to study the Highway 99 issue further. They agreed to work with staff to set up a meeting with representatives from the Highway 99 Task Force and the EDC's land use subcommittee. Staff is incorporating the Board suggestions for later review. Further details are available on the City's website under Planning Board agendas. On behalf of the Planning Board, Vice Chair Stewart thanked the Mayor, Councilmembers, staff, and involved citizens for their careful study and consideration of all the land issues the Planning Board evaluates. It is extremely important work, looking toward a much needed sustainable approach to land use and development in order to ensure equity, a clean and healthy environment, and resilient economics. Councilmember Bloom thanked Ms. Stewart for her reference to items that address goals in the Strategic Plan. 10. SNO-ISLE REGIONAL LIBRARY PRESENTATION Jonalyn Woolf -Ivory, Sno-Isle Libraries Executive Director, commented in 1946 the partnership between Edmonds and Sno-Isle Libraries began. A lot of has changed in the Edmonds and Sno-Isle community since 1946; a beautiful new library building, a new City Hall, 24-hour access to library resources, online homework assistance and new faces in the community and at the library. Regardless of the shape or format, library materials provide a doorway to reading, resources and lifelong learning. The partnership between Edmonds and Sno-Isle Libraries is built on mutual respect and support. The partnership began with a contract for library service in 1946. The Library District agreed to provide library service and the City agreed to provide library quarters and furnishings, utilities and janitorial Edmonds City Council Approved Minutes June 25, 2013 Page 12 services. Over the years, the library building was replaced, more materials and books were added to the collection, space was made for computers, staff and open hours were added and the Library District began reimbursing the City for utilities and janitorial costs. In 2001, faced with many financial issues, the City asked its citizens to annex to the Sno-Isle Libraries District. Peggy Pritchard -Olsen led a successful annexation campaign that resulted in Edmonds residents paying Sno-Isle Libraries directly for library services, allowing the City to cease paying the contract fee and be responsible for only providing the library facility. The results of this updated partnership have been incredibly successful. The City is no longer required to pay for library services from the General Fund, Edmonds residents no longer fear losing their library, and Sno-Isle Libraries now has an ongoing source of revenue that allows for thoughtful planning of future services. She appreciated the Mayor's and City Council's forethought that lead to the 2001 annexation election and knew that Ms. Pritchard-Olsen's work with the Friends of the Edmonds Library and the Library Board ensured that the future of the library in Edmonds was secure. Public libraries are a vital part of a vibrant community and for a community such as Edmonds; the library is the first step that a young family takes on the road to early learning. It is a go -to resource for small businesses and job seekers and an essential element of the community's quality of life. Her work at Sno- Isle Libraries focuses on working with staff and communities to provide the best possible customer service within each of the 21 community libraries, whether provided directly by Lesly Kaplan at a customer service desk in the library or from a staff member providing virtual service to a customer via the internet. Recently the Board of Trustees took steps to begin the Library District's upcoming Strategic Planning cycle, looking out to the next three years, gathering feedback from community members, local library boards, and friends groups and looking closely at the demographics through Snohomish and Island Counties. Over the next several months, there will be opportunity to provide feedback, comment and discussion regarding library services. Sno-Isle Libraries is a community of libraries. Their success depends on the success of each of the 21 community libraries. They count the Edmonds Library as a success, a success that started with an engaged and supportive community. Kendra Trachta, Sno-Isle Libraries Deputy Director, recognized the impact of Library Manager Lesly Kaplan and the library's staff. The summer reading program kicked off today, their annual project to keep kids reading and learning throughout the summer. This year's theme is Dig into Reading; today's event included the Pacific Science Center. Over 100 children attended and over 250 children have signed up for summer reading in Edmonds. Thanks to a suggestion by Ms. Kaplan, Ms. Trachta reported the Edmonds Library is checking out tablet PCs to customers in the library to allow them to sit in the comfortable chairs and read the new electronic magazine service, Zinio. Recent improvements at the Edmonds Library include replacing all the old wooden shelving and the Friends of the Edmonds Library funded comfortable seating, new seats for tables and replaced all the blinds. Ms. Trachta explained the Edmonds Library also go out into the community. Library staff are members of the Chamber of Commerce and make contact with businesses, introducing them to business resources; a librarian visits the Senior Center every month to teach classes on new devices and library eBooks. The Edmonds Library is collaborating with Humanities Washington and Edmonds Community College thanks to a grant from the Hazel Miller Foundation on a series of conversations from the Humanities Washington Speakers Bureau. At each session, resources and links to library titles are provided so that participants can continue learning about what they hear in those public conversations. Edmonds City Council Approved Minutes June 25, 2013 Page 13 Councilmember Johnson thanked Sno-Isle for the Near Futures Conference held recently, Transforming the Nexus of Business, Education, Government and Libraries; she found it very informational and inspiring. She expressed her appreciation for the work of all the library staff. 11. EDMONDS DOWNTOWN BUSINESS IMPROVEMENT DISTRICT INTERIM MEMBERS ADVISORY BOARD'S PROPOSED WORK PROGRAMBUDGET FOR YEAR 2013 AND BYLAWS Community Services/Economic Development Director Stephen Clifton explained ECC Section 3.75.120 requires the Edmonds Downtown Business Improvement District (EDBID) Interim Advisory Board present the Council a work plan and bylaws within 90 days of the Mayor's appointment of the Board. A presentation to the Finance Committee in June met the 90 day requirement. He met with Councilmember Bloom and Mary Kay Sneeringer, a member of the EDBID Interim Members Advisory Board, today to discuss the amendments to the bylaws proposed by Councilmember Bloom. A redlined copy of the bylaws with those amendments was distributed to the Council tonight. David Arista, Arista Wine Cellars, President, EDBID Interim Members Advisory Board, introduced the members of the BID Interim Members Advisory Board who were present: Sally Merck, Sally Merck Counseling; Paul Rucker, Saetia; Mary Kay Sneeringer, Edmonds Bookshop; and Kim Wahl, Reliable Floor Coverings. Other members include Steve Balas, Waterfront Coffee Co.; Juliana Buskirk, Edward Jones; Kevin Clarke, Clarke Consulting Group; Cadence Clyborne, HDR Engineering; Chris Fleck, Puget Sound Tax Services; and Pam Stuller, Walnut Street Coffee. Mr. Arista explained the EDBID was approved by the City Council on January 15, 2013 and updated February 26, 2013. The Interim BID Members Advisory Board was appointed by Mayor Earling on March 12, 2013. The EDBID Board will present a proposed 2014 work plan to the City Council in September. Assessments and collection of assessments have begun. The most recent information indicates the EDBID has received close to 80% of the assessments. A few logistical issues such as businesses that have closed and discrepancies in square footage are being addressed. Assessments for the three quarters of 2013 total approximately $22,000 per quarter for total assessments of $66,000. Depending on the number of businesses that open and close, he anticipated next year's budget would be approximately $90,000. The EDBID Interim Members Advisory Board developed the proposed bylaws working with City Attorney Jeff Taraday. The Board will consider Councilmember Bloom's suggested changes to the bylaws at their next meeting. He recognized City staff they have worked with including Stephen Clifton, Cindi Cruz, Jeff Taraday, Roger Neumaier, Sandy Chase and many other department staff. He summarized their overall goal is to build a good foundation for the EDBID for the betterment of downtown businesses as well as the overall community. Paul Rucker, Co -Owner, Saetia, EDBID Interim Members Advisory Board Member, explained he and his wife opened their business three years ago; his day job is Executive Director UW Alumni Association, a non-profit, dues -paying membership community with 60,000 dues -paying members. He appreciated the contributions of the Members Advisory Board to ensure that by -appointment, service and retail businesses are both engaged and incorporated in this process. The work plan incorporates the goals and objectives of the ordinance as well as speaks to areas the Members Advisory Board would like to emphasize in the next six months. He highlighted several priorities: establish a foundation of the EDBID governing structure, non-profit incorporation of the EDBID and operating agreement between the EDBID and the City. He recognized member communication, engagement, participation and stewardship is the priority and will be highlighted in the next six months. The EDBID recognizes the architecture to establish a brand and identity of the EDBID is a key priority and it is included in the work plan for the remainder of this year and into next year. The EDBID Edmonds City Council Approved Minutes June 25, 2013 Page 14 recognizes the responsibility of stewardship of resources and assessments of all members, and evaluating the effectiveness of expenditures. The work plan incorporates an opportunity to engage with education institutions such as the L W Business School to ensure the ability to provide return on investment and benefit for those resources is properly stewarded and communicated to members and the City. Mr. Rucker referred to the proposed 2013 budget of $40,000 for the remainder of 2013, recognizing the estimated revenue of $66,000 will be collected through the remainder of the year. Key priorities and allocations are identified on the last page of the budget. The EDBID anticipates unallocated funds for the first year of $26,000, and will be prepared to present a more comprehensive 2014 budget along with the 2014 work plan. Councilmember Bloom commented the total 2013 budget is $40,000 and $26,000 is allocated to branding and identity development. She asked for an explanation regarding how the funds would be allocated and what was meant by branding and identity of the EDBID. Mr. Rucker explained the ordinance specifies a scope of work and identifies the areas the EDBID is able to allocate expenses to and attempt to achieve its goal of improving the Edmonds Downtown Business District. Other BIDS this size have focused on establishing a clear and distinct brand and identity, and creating a toolkit, logos, signage, website presence, etc. that create a package and an identity that is consistent with introductory and formative efforts of BIDs Edmonds' size. The EDBID's research of similar efforts nationally indicated that was the first step that would inform the process of establishing a foundation for EDBID's efforts. This would be done in partnership with the Chamber, City and other civic organizations that are active in the publicity and promotion of the City. Councilmember Bloom observed the bulk of the budget was allocated to branding and identity, including hiring a consultant to assist. She asked if the intent was to pay a consultant to assist with developing a logo and website design as well as a brand for the EDBID. Mr. Arista answered it would include all those things. The intent is to establish a foundation to build future programs on. The all -volunteer Advisory Board anticipates a brand will be developed over the next six months. Establishing the brand will be a one-time expense; marketing efforts will result from the brand. For example, a Shop Local means shopping at local retail as well as using local services, lawyers, doctors, counselors, etc. It is possible the entire amount will not be expended on that item in the budget. Councilmember Bloom asked how much of the $26,000 would be allocated to a consultant. Mr. Arista answered he was uncertain at this point. The intent of the full member meeting in September was to gather input from the membership that the Board was moving in the direction the membership wants. Once the full member meeting is held, the Board will have a better idea of exactly how to spend those funds. Mr. Rucker advised a Request for Proposals will be prepared for a qualified creative agency or consultant to guide this process. One of the concerns was ensuring any creative approach, branding or identity effort were not done by volunteers on their home computer but worked in concert with the City and other agencies to ensure the effort had a level of professionalism. Mr. Arista explained the work to date has been done entirely by the volunteers on the EDBID, all of whom have their own businesses. At some point, professional assistance will be necessary if the goal is a good product. Councilmember Buckshnis commented she had worked on two logos, one for the dog park and one for the Floretum Garden Club. She agreed it was a tremendous effort to ensure you got everyone's opinion. She noted 65% of the first six months' proceeds would go toward the branding and logo. Although she did not want to micromanage, she recognized that was a large amount. She agreed a professional was needed to do the logo, explaining one of the volunteers in the organizations she was involved in was from Microsoft and did their logos free of charge. Councilmember Johnson commented branding for the City has been discussed for many years as it relates not only to the BID but also the arts community and others. She asked how branding for the EDBID Edmonds City Council Approved Minutes June 25, 2013 Page 15 would be coordinated with branding for the rest of the City. Mr. Clifton answered the EDBID is a distinct entity and needs to determine their brand themselves. As branding moves forward on a citywide basis, that will be considered as part of a bigger picture. He recalled Roger Brooks' advice that branding come not from elected officials or the City but from the private sector and business community. Main Motion #1 COUNCILMEMBER PETERSON MOVED, SECONDED BY COUNCILMEMBER BUCKSHNIS, TO APPROVE THE WORK PLAN PREPARED BY THE DOWNTOWN EDMONDS BUSINESS IMPROVEMENT DISTRICT. Councilmember Bloom expressed concern with the amount allocated to branding and identity development in the work plan, fording it put the cart before the horse. There are two distinct groups of business owners, by appointment and open door. The concerns of all focus on parking and a public restroom. She was concerned with jumping into a brand or identity when it was linked with the identity of the entire City and before funds have been allocated for exploration of a map to identify available parking spaces or the EDBID doing a project that would generate enthusiasm She understood a number of people have serious concerns about allocating their assessments to this endeavor. She will not support the work plan, finding the allocation of $26,000 in this budget cycle to branding and identity development premature and there were other things that should be worked on first to get the buy -in of by appointment businesses as well as open door businesses that opposed the EDBID. Councilmember Fraley-Monillas pointed out a committee with members from both open door and by appointment businesses was appointed to consider this. She assumed the committee had vetted the issue. Mr. Arista assured it has been. Everyone on the Board does not necessarily just represent one constituency, open door or by appointment, they represent all viewpoints. Councilmember Johnson asked how the branding, identity and website would work for by appointment businesses. She noted approximately 50% of the EDBID members are by appointment businesses. She recognized it would be a challenge to meet the needs of that group. Mr. Rucker explained an attempt was made to capture that in Section G, Professional Business Resources, to ensure professional development, training, technology resources, innovation for by -appointment business was part of the effort in order to provide value to all members. He recognized there is a shared common good from increased publicity and foot traffic to the health and wellness of the downtown business district. The assessment and evaluation by the UW Business School to ensure expenditures advance the effective goals of the EDBID was an attempt to recognize the diversity of the membership. The responsibility of the EDBID leadership is to ensure engagement with all members of the community and identifying value on an annual basis. Vote on Main Motion #1 MOTION CARRIED (5-1), COUNCILMEMBER BLOOM VOTING NO. Main Motion #2 COUNCILMEMBER FRALEY-MONILLAS MOVED, SECONDED BY COUNCIL PRESIDENT PETSO, TO APPROVE THE BYLAWS OF THE EDMONDS DOWNTOWN BUSINESS IMPROVEMENT DISTRICT AS AMENDED IN THE CURRENT DOCUMENT. Councilmember Fraley-Monillas noted the proposed amendments were minor. Mr. Arista responded the bylaws would need to be approved by the Advisory Board first. The Board has not met since Councilmember Bloom proposed the amendments this afternoon. He agreed the amendments appear to be minor but he did not think the Council could approve the bylaws until the Advisory Board had approved the amended bylaws. He noted bylaws can be amended; the Council could approve the bylaws as proposed, the Advisory Board could review the amendments proposed by Councilmember Bloom and if the Board approved the amendments, the Council could approve the amended bylaws. Edmonds City Council Approved Minutes June 25, 2013 Page 16 Mr. Taraday advised that the Council may want to wait until the Interim EDBID Members Advisory Board has approved the revised language, but the Council can approve any bylaws they wish. If there are questions about the amendments to the bylaws, he agreed it may be preferable to have another meeting with the Advisory Board before the Council adopts them. Councilmember Bloom thanked Ms. Sneeringer and Mr. Clifton for meeting with her today and Ms. Merck for speaking with her. She preferred to have the amendments she suggested included in the adoption of the bylaws. She proposed an additional amendment to the composition of the Advisory Board to reflect not how much each member pays but the actual percentage of open door versus appointment only businesses. There is a larger percentage of by appointment businesses in the EDBID than open door businesses. She noted it is well known that she did not support the BID; however, as a business owner in the BID, she wants it to succeed. She suggested the following change in Section 5.1.a. Composition, "...To the best possible degree, members of the EDBID Board will be composed of both open door and by appointment EDBID members in rough proportion to the dollar va4ue of assessmen4s to be leNied on ^'' elassifieation ^fbusiness percentage of open door and by appointment businesses in the EDBID" She explained this would shift the balance to six by appointment businesses and five open door businesses. She felt this would improve relationships for the EDBID. Mayor Earling suggested Councilmember Bloom provide draft language to the Board for their consideration with the other bylaw changes at their next meeting and return to the Council for approval of the amended bylaws. Action on Main Motion #2 COUNCILMEMBER FRALEY-MONILLAS WITHDREW HER MOTION WITH THE AGREEMENT OF THE SECOND. Main Motion #3 COUNCILMEMBER FRALEY-MONILLAS MOVED, SECONDED BY COUNCIL PRESIDENT PETSO, TO SEND THE BYLAWS BACK TO THE EDMONDS DOWNTOWN BUSINESS IMPROVEMENT DISTRICT ALONG WITH COUNCILMEMBER BLOOM'S ADDITIONAL AMENDMENT. Councilmember Peterson spoke against the motion, stating it was setting up a slippery slope. The last thing the Council wants to do is micromanage the BID. The Council needs to trust that the EDBID has vetted a lot of things. The Council should give the EDBID an opportunity to succeed and build on the momentum. The Board developed all this information in 90 days, an incredible feat for a group of volunteers who have businesses to run and other community service commitments. He preferred to approve the bylaws as proposed. If there are serious issues, the Board can return to the Council with needed amendments. Mr. Clifton commented in today's meeting with Councilmember Bloom, there was discussion that the amendments reflected in the draft provided to the Council tonight were minor enough that the Advisory Board would find them acceptable. The change Councilmember Bloom proposed to Section 5. La to alter the composition of the Board is significant enough that neither he nor Ms. Sneeringer were comfortable taking a position or guessing whether the Advisory Board would accept it. He concluded that change was significant enough that it warranted having the Advisory Board discuss it. Councilmember Fraley-Monillas summarized the amendments provided in the ordinance were minor; she asked whether the Council could approve the bylaws with the amendments or did the EDBID Advisory Board have to approve them first. Mr. Arista advised the amendments to the bylaws, with the exception of the last amendment Councilmember Bloom proposed, were minor. Mr. Taraday has indicated the Council can approve the bylaws with those amendments tonight; his understanding was they had to be approved by the Board first but apparently that is incorrect. Edmonds City Council Approved Minutes June 25, 2013 Page 17 Action on Main Motion #3 COUNCILMEMBER FRALEY-MONILLAS WITHDREW HER MOTION WITH THE AGREEMENT OF THE SECOND. Main Motion #4 COUNCILMEMBER FRALEY-MONILLAS MOVED, SECONDED BY PETERSON, TO ACCEPT THE BYLAWS AS AMENDED TONIGHT WITH THE PRINTED CHANGES. Amendment #1 COUNCILMEMBER BLOOM MOVED, SECONDED BY COUNCIL PRESIDENT PETSO, TO AMEND THE MOTION TO CHANGE THE WORDING OF 5.1.A COMPOSITION, FROM "THE BOARD WILL BE COMPOSED OF BOTH OPEN DOOR AND BY APPOINTMENT EDBID MEMBERS IN ROUGH PROPORTION TO THE DOLLAR VALUE OF ASSESSMENTS TO BE LEVIED ON EACH CLASSIFICATION OF BUSINESSES" TO "IN ROUGH PROPORTION TO THE PERCENTAGE OF OPEN DOOR AND BY APPOINTMENT BUSINESSES IN THE EDBID." Vote on Amendment #1 MOTION CARRIED (5-1), COUNCILMEMBER PETERSON VOTING NO. Councilmember Peterson commented the Council had done what he was hoping they would not do, micromanage the EDBID. The Council made a significant change to the structure of the BID without consulting the EDBID. The whole point of a BID is to have the businesses come up with the ideas and not have them dictated by the City Council. The Council just blew that whole concept out of the water. All Councilmembers have seen Roger Brooks' presentation where he recommended letting the businesses do the work and the Council stay out of the way. He will vote against the main motion because he could not believe the Council had already stepped in it this early in the process. Councilmember Fraley-Monillas did not view Councilmember Bloom's amendment as a drastic change. All the board members own businesses in Edmonds; the amendment did not change the number of board members; it only changed number of board members from one category to another. She has no vested interest and wants to do what was best for the BID and businesses downtown. Councilmember Bloom agreed with Councilmember Fraley-Monillas. She did not view this as micromanaging; it is changing the allocation of board members from basing it on the amount of money they pay in to the majority of business owners which is a reasonable suggestion. Council President Petso commented the Council had an opportunity early to send the proposed amendments to the bylaws back to the EDBID Advisory Board. She will support the motion and if it needs to be changed, she is confident the Advisory Board will approach the Council with a proposed change. Councilmember Buckshnis commented the amendments to the bylaws should have gone back to the EDBID Board. She felt the composition of the Board does have an impact but because she preferred the EDBID Board should have an opportunity to review the proposed change first, she will vote no on the motion. Councilmember Johnson preferred to have the amendments to the bylaws returned to the EDBID Advisory Board for their consideration; therefore, she will vote no on the motion. For Councilmember Fraley-Monillas, Mr. Taraday clarified the motion was to approve the version of the bylaws that was emailed to Councilmembers by Mr. Clifton at 4:38 p.m, today that was subsequently amended by Councilmember Bloom's motion. Edmonds City Council Approved Minutes June 25, 2013 Page 18 Vote on Main Motion #4 UPON ROLL CALL, THE VOTE WAS (3-3), COUNCILMEMBERS FRALEY-MONILLAS AND BLOOM AND COUNCIL PRESIDENT PETSO VOTING YES; AND COUNCILMEMBERS PETERSON, JOHNSON AND BUCKSHNIS VOTING NO. DUE TO THE TIE VOTE, MAYOR EARLING VOTED NO. MOTION FAILED. Main Mntinn #5 COUNCILMEMBER FRALEY-MONILLAS MOVED, SECONDED BY COUNCILMEMBER PETERSON, TO PASS THE AMENDED BYLAWS FOR THE EDMONDS DOWNTOWN BUSINESS IMPROVEMENT DISTRICT AS AMENDED IN THE PRINTED BYLAWS AND WITHOUT COUNCILMEMBER BLOOM'S AMENDMENT. Councilmember Bloom said she would not support the motion because it did not include the amendment she proposed. She preferred to send the amendments back to the Advisory Board to consider all the proposed changes including the change she proposed to the composition of the Board. Vote on Main Motion #5 UPON ROLL CALL, MOTION FAILED (2-4), COUNCILMEMBERS FRALEY-MONILLAS AND PETERSON VOTING YES; AND COUNCIL PRESIDENT PETSO AND COUNCILMEMBERS BLOOM, JOHNSON AND BUCKSHNIS VOTING NO. Main Motion #6 COUNCIL PRESIDENT PETSO MOVED, SECONDED BY COUNCILMEMBER BUCKSHNIS, TO ASK THE EDMONDS DOWNTOWN BUSINESS IMPROVEMENT DISTRICT TO CONSIDER COUNCILMEMBER BLOOM'S PROPOSED CHANGES, BOTH WRITTEN AND THE ONE READ INTO THE RECORD TONIGHT AND RETURN TO THE COUNCIL ON ANOTHER DAY. Vote on Main Motion #6 MOTION CARRIED (5-1), COUNCILMEMBER PETERSON VOTING NO. 12. ORDINANCE AMENDING EDMONDS CITY CODE SECTIONS 3.75.060 - 100 RELATING TO THE EDMONDS DOWNTOWN BUSINESS IMPROVEMENT DISTRICT MEMBERS ADVISORY BOARD. Community Services/Economic Development Director Stephen Clifton explained these amendments were recommended by Interim Finance Director Ron Cone to clarify the language in the code regarding unpaid assessments, delinquent charges and payments. The revisions do not change the intent of the ordinance, they only provide clarification. He highlighted changes in ECC 3.75.060, 3.75.080 and 3.75.100 related to delinquency charges, and 3.75.080 related to how the interest rate is calculated. COUNCILMEMBER BUCKSHNIS MOVED, SECONDED BY COUNCILMEMBER PETERSON, TO APPROVE ORDINANCE NO. 3929, AN ORDINANCE OF THE CITY OF EDMONDS, WASHINGTON, AMENDING EDMONDS CITY CODE, SECTIONS 3.75.060, 3.75.070, 3.75.080, 3.75.090 AND 3.75.100 RELATING TO THE EDMONDS DOWNTOWN BUSINESS IMPROVEMENT DISTRICT. MOTION CARRIED UNANIMOUSLY. 13. REVENUE BOND FINANCING PRESENTATION Public Works Director Phil Williams recalled the City's last utility capital bond was late in 2011. Most plans show the City borrowing funds every two years. The proper use of debt in financing the utility capital program was discussed with the Finance Committee and the Parks, Planning and Public Works Committee two weeks ago. Tonight's discussion does not relate to that longer range issue. Edmonds City Council Approved Minutes June 25, 2013 Page 19 Mr. Williams explained the intent of borrowing money is to support the water, sewer and stormwater capital programs, just as was done in 2011. He provided photographs of the interior of pipes and identified how the bond proceeds would be used: • Water Utility o Replace/upsize old pipes o Improve flow pressure o Upgrade pressure reducing stations. He described the reasons • Sewer Utility o Replace existing pipes o Cured in Place Pipe repairs o Upsize pipe • Storm Utility o Replace existing pipes o Cured in Place Pipe repairs o Upsize pipe Scott Bauer, A. Dashen & Associates, provided graphs illustrating Bond Buyer 20-bond GO Index 1990 to present, and the Municipal Yield Curve, identifying rates on December 14, 2011; May 10, 2013; and June 25, 2013. He explained interest rates hit 40-year lows in early December 2012. Rates have risen over the past five weeks, but are still low by historical standards. He provided a debt profile of the City's outstanding revenue bonds (2011 Water & Sewer Revenue Bonds). Mr. Bauer reviewed the financing plan: • Provide approximately $14 million in project funds for the water, sewer, and stormwater systems • Fund the reserve account and pay the bond issuance costs • Wrap the debt service around the existing bonds • Final maturity in 20 or 25 years (Mr. Bauer recommended 25 years) Mr. Bauer described delegation authority: • Under Washington State law, the City Council can delegate final approval of bond sale to designated individuals • This was utilized on the City's prior transactions • This delegated authority allows the bond sale to occur on days other than a board meeting / City Council date • Certain parameters are set in advance in the ordinance o Maximum issue sizes o Maximum interest rates o Minimum savings o Final maturity • Provides more flexibility in timing bond issue Mr. Bauer described sale method options: • Negotiated Sale o The City selects an underwriting firm to which bonds will be sold • Competitive Sale o The City solicits sealed bids from underwriters nationally o The bonds would be sold to the underwriter providing the best combination of interest rates and fee (i.e., true interest cost) at the specified date and time • Each sale method has advantages / disadvantages o Competitive sales work well for high quality general obligation and water/sewer bonds in stable markets Edmonds City Council Approved Minutes June 25, 2013 Page 20 o Highly transparent results • Planning for a competitive sale o The Bond Ordinance will provide for change in sale method, based on financial advisor recommendation, if market conditions warrant He reviewed the schedule of events: • July 16 Council Approval of Delegation Ordinance • July 18 Rating Visit • July 31 Post Preliminary Official Statement (Marketing Document) • August 7 Competitive Bond Sale • August 21 Bond Closing — Funds Available Councilmember Buckshnis asked whether it could be expected inflation would continue and bond rates would continue to increase. Mr. Bauer agreed that could be expected; how quickly rates increased was unexpected. He anticipated short term interest would level out. Councilmember Buckshnis observed the bond sale should occur sooner than later. Mayor Earling asked if the schedule could be condensed. Mr. Bauer answered consideration could be given to moving it up a week; the 4tn of July holiday impacts the schedule. Mayor Earling observed moving as quickly as possible would improve the chances of avoiding another spike in rates. With the Council's approval, Finance Director Roger Neumaier assured the schedule would be expedited as much as possible. He concurred with A. Dashen & Associates' recommendation for 25 year bonds. COUNCIL PRESIDENT PETSO MOVED, SECONDED BY COUNCILMEMBER BUCKSHNIS, TO EXTEND THE MEETING FOR 15 MINUTES. MOTION CARRIED UNANIMOUSLY. Council President Petso asked if the bond issue would provide funds for water, sewer and stormwater. Mr. Williams answered yes. Council President Petso asked whether the Council had not yet adopted one of the utilities' Comprehensive Plans or were all of them current. Mr. Williams answered there are current Comprehensive Plan on all utilities; they are updated every six years. Until the Comprehensive Plan is replaced with a new one, the existing plan is current. An update is being prepared for the Sewer Comprehensive Plan and will be presented to the Council this fall. The Sewer Comprehensive Plan focuses on the conveyance system. Council President Petso asked if the reason bonds were being sold before the Sewer Comprehensive Plan and rate analysis were completed was to capture the lower interest rates. Mr. Williams answered that is one of the reasons but it is clear the City needs to start replacing sewer pipes and those funds must be borrowed because they are not available in the sewer fund. There were no objections voiced by the Council to proceeding as proposed. 14. PRESENTATION ON STORMWATER LOW IMPACT DEVELOPMENT (LID) - USING RAIN GARDENS FOR STORMWATER MANAGEMENT. This item will be rescheduled on a future agenda. 15. DISCUSSION: EDMONDS CITY CODE CHAPTER 2 REVISIONS. This item was moved to the Public Safety and Personnel Committee via action under Agenda Item 3. 16. REPORT ON OUTSIDE BOARD AND COMMITTEE MEETINGS. Councilmember Johnson reported on June 10 she participated on a panel to review artist selection for the Five Corners roundabout. There were 21 artists who participated in the artist selection; 3 were selected to submit proposals that will be presented on July 25 from 5:30 — 6:30 p.m. in the Library Plaza Room. Edmonds City Council Approved Minutes June 25, 2013 Page 21 Councilmember Buckshnis reported Snohomish County Tomorrow received their assessments which had not changed. She reported on the WRIA 8 meeting; Edmonds is attempting to get Lynnwood and Woodway to join WRIA 8. Perrinville Creek is one of the creeks that WRIA 8 is looking at. Councilmember Peterson reported the Public Facilities District interviewed candidates and selected two new members. Their appointments will be scheduled on a future Council agenda. He participated in the interviews of several great candidates; the two selected will serve the community well. Councilmember Bloom reported the Economic Development Commission discussed implementation of the Strategic Plan, limiting office space in the BD zone, and the email policy. The meeting also included a report from the Technical Subcommittee and a report by the Tourism Subcommittee regarding changes the Port has made to their website. Councilmember Bloom reported the Tree Board did not have a quorum 17. MAYOR'S COMMENTS Mayor Earling provided a reminder of the Arts Summit on Saturday, June 29, 8:30 a.m. — 3:00 p.m. at the Edmonds Center for the Arts. Over 220 people have registered and he hoped Councilmembers would attend at least part of the day. 18. COUNCIL COMMENTS Councilmember Bloom encouraged everyone to support the new mid -week market on the Salish Crossing property on Wednesdays from 3:00 — 7:00 p.m. Councilmember Fraley-Monillas reported Congressman Jim McDermott's town hall meeting was well attended. Congressman McDermott also toured the Edmonds Saturday Market. Council President Petso echoed an earlier speaker who wished Betty Mueller a happy birthday and praised her contributions to the City. Councilmember Buckshnis announced there were only seven flower beds left for adoption. The $250 cost to adopt a corner flower bed is tax deductible. Councilmember Johnson thanked the members of the Planning Board and the Interim EDBID Advisory Board for their participation in civic engagement. 19. CONVENE IN EXECUTIVE SESSION REGARDING PENDING LITIGATION PER RCW 42.30.110(1)(i) This agenda item was not required. 20. RECONVENE IN OPEN SESSION. POTENTIAL ACTION AS A RESULT OF MEETING IN EXECUTIVE SESSION This agenda item was not required. 21. ADJOURN With no further business, the Council meeting was adjourned at 10:10 p.m. Edmonds City Council Approved Minutes June 25, 2013 Page 22