CITY OF SHORELINE

SHORELINE PLANNING COMMISSION

SUMMARY MINUTES

SPECIAL JOINT WORKSHOP WITH CITY COUNCIL

September 21, 2000

6:30 P.M.

Shoreline Conference Center

Board Room

Chair Gabbert described the process that would be followed for both the work session and the regular meeting.

1. North City Sub-Area Plan

Mr. Stewart provided background information regarding the North City Sub-Area Planning process which was led by Anna Kolousek with participation from various staff members.

Ms. Kolousek said that the North City Sub-Area Plan is a result of the design charette that was conducted in June. The major purpose of the Sub-Area plan was to provide a planning framework that would be unique to the North City area. Another purpose was to preserve the privacy and safety of the existing neighborhoods. Many of the citizens who attended the charette were very concerned about the spill-over affect to the surrounding neighborhoods. The third purpose of the plan was to provide incentives to encourage redevelopment, particularly in the business area concentrated on 15^th Ave NE. Lastly, the plan was intended to provide a design direction for the development and improvements along 15^th Ave NE between 172^nd and 180^th Streets.

Ms. Kolousek said the first document before the Commission and Council is the amendment to the Comprehensive Plan. The second document includes special district development standards for the newly adopted Development Code. Included in the attachments is a prepared financial and Market Analysis to show some of the demonstrated projects and test their viability. Ms. Kolousek said the redevelopment concept of the plan is structured around what has been determined to be walkable distances to the business district. These walkable distances create four distinguished neighborhood units that are approximately one half mile from the heart of the business district. Ms. Kolousek said that within the heart of the business district, the plan proposes to create an interesting and safe walking street that is surrounded by a mix of office, retail and residential development. The street, itself, would be narrowed to three lanes. Traffic would have to slow down significantly to allow for public interaction.

Ms. Kolousek said that a market consultant reviewed the potential feasibility of this area. The Market Analysis showed that the aggregate potential income, within the two-mile radius, is $2 billion. This translates into a potential of $800 million in consumer spending per year. The results indicate that there is clearly a potential for over 100,000 square feet of new retail space between 172^nd and 180^th Streets. However, she noted that the current rental rates do not support new construction. The plan identifies two options. The City can continue with the status quo until sufficient disinvestment retires the poor performing properties existing today and allows redevelopment of larger, low-density, auto-oriented uses. The other option would be to capture higher volumes by bringing the local potential into the higher density development of more retail oriented uses. Capturing the surrounding spending and achieving the higher rental rates requires several actions to improve the existing environment, and that is the aim and vision of the proposed plan.

Ms. Kolousek explained that the Comprehensive Plan portion of the document presents two schemes. The five-year scheme includes the following demonstration sites (the corner of 180^th and 15^th Ave NE, immediately across from 177^th Street, across from the Shoreline Water District, and the post office and Safeway sites located south of 175^th Street). The property owners of these sites were heavily involved in the design cherette. The 15-year scheme involves the stretch of 15^th Ave NE between 175^th and 180^th Streets, which would be surrounded by mixed-use development with parking located behind the buildings and accessible from the alleys. There would only be limited access from 15^th Ave NE. This scheme would create a type of "main street" development with retail on the ground floor and residential units above.

Ms. Kolousek said the North City Sub-Area plan also presents options for creating more pedestrian friendly streets. Page 25 of the North City Sub-Area Plan Draft shows the concept of changing the existing four-lane street with limited street parking, sporadic sidewalks and numerous access points into a three-lane street with a left turn lane, wider sidewalks on both sides and pedestrian crossings at key points. The engineer provided a diagram to illustrate both the existing and proposed street alignment. The concept also considers the surrounding residential areas. She noted that one of the purposes of the plan is to encourage people to walk into the business area, but the present street system does not encourage pedestrian interaction. The consultant indicated that the streets should be made more pedestrian friendly and traffic on surrounding streets should be designed to discourage fast moving traffic.

Ms. Kolousek reviewed the designs proposed in the Plan for each demonstration site. The plan proposes that the North City district be identified as a special district in the Development Code. This would involve two overlay zones. Zone 1 (located from approximately 175^th to 177^th Streets) would not allow residential units on the ground floor. The ground floor would have to be occupied by 100 percent retail uses. There would be no required setbacks for buildings located in this zone. The same setback standards for retail uses would apply to Zone 2, as well. However, Zone 2 would allow residential units to be located on the ground floor. The code would require that these units be setback 10 feet from the sidewalk to allow for a residential type of access. The plan also recommends that there be a vertical setback along the street for taller buildings so that shadow and tunnel affects do not impact adjacent properties. To emphasize the corners, buildings within 50 feet of the street corners would be allowed a greater height with no setback requirements, but upper stories on properties more than 50 feet from the corner would have a required setback.

Ms. Kolousek referenced Table 1, and asked that Planning Commission and City Council consider the option of allowing a density bonus in order to make projects in this area more feasible. She concluded that redevelopment potential exists. Based on the financial analysis, the plan seems to provide a realistic concept. The City is concurrently preparing the traffic study to analyze what could happen if the street is constrained to three lanes. At the same time, they are preparing a planned action SEPA review. Once the SEPA review is complete, there will be no need for developers to go through additional SEPA review if their proposed project is consistent with the plan.

Commissioner Doennebrink inquired what the current rental rates are in the North City area. Ms. Kolousek answered that the rental rates are about $15 per square foot. Mr. Stewart noted that Page 5 of the North City Sub-Area Plan Draft identifies the current rates and the rates that would be needed to support retail uses. The conclusion was that retail would be financially feasible at triple rent of $17 to $18 per foot ($22 to $23 gross per square foot).

Councilmember Lee said there are many different opinions regarding mixed retail and residential uses. She noticed that in areas of Bellevue and Redmond, for example, property owners are still having trouble filling their spaces. She inquired if studies have concluded that this type of development is successful in cities. Mr. Stewart agreed that is one of the risks the City is facing, but the market study concluded that the area could support mixed-use development.

Commissioner Harris pointed towards downtown Ballard which is in a "dying phase." It seems that the key to the plan’s success is the 1,500 more housing units that are identified. The trend seems to be towards the big block stores such as Costco. He likes the proposed plan, but it appears to be risky.

Commissioner Doering inquired what the average income of the area is. She said she is concerned about whether or not the people living in the area will be able to afford the units. Mr. Stewart referred to Page 8 of the Market Feasibility Study, which is the data that was used to calculate feasibility and whether or not mixed-use development would work. The team considered the revenue stream and the realistic construction costs of development, and the conclusion was that it appears to be feasible.

Councilmember Montgomery agreed that if 15^th NE is narrowed to three lanes it would make a beautiful roadway, but it could create a traffic boondoggle that would cause people to avoid doing business in the area. Mr. Stewart referred to Page 16 of the North City Sub-Area Plan Draft, which illustrates, through the use of a schematic diagram, the impacts associated with a narrower road. If they constrain 15^th NE, the cars would be pushed somewhere else. Cutting through the neighborhoods is unacceptable. The other alternative would be to push the traffic on to large arterial streets. The consultant guessed that perhaps as much as 40 percent of the traffic during peak hour on 15^th NE has origins and destinations outside of the City. That is the target population that they want to constrain or reduce.

Commissioner Maloney suggested that by identifying as many as 1,500 units for this area, it seems to make a statement to the Growth Management Board that the City can readily accept more of the population growth than they have presently agreed to take. Mr. Stewart said that based on economics or demographics, the consultant is suggesting that there is a market for 1,500 units. This is not being recommended as a target for North City. The intent is to demonstrate the strength of the market to individual site developers. Ms. Kolousek noted that this figure would not become part of the actual plan. It is only identified in the Market Analysis, which will be an appendix to the plan.

Councilmember Gustafson inquired if the ESA listing would have a significant impact on the cost of construction or review. Mr. Stewart explained that most of the property included in the plan is already impervious surface. For example, a change from a parking lot to a building would not increase the amount of impervious surface. The drainage area for North City is in a depressed basin, which goes into a detention basin right off of 15^th NE next to the bus barn. Water quality issues in North City are going to be much easier to deal with than some of the other areas of the City.

Mayor Jepson said it seems grandiose to think that there would be 1,500 residential units constructed in the City in the short term. He supports mixed-uses in this area. He said his largest concern is how this plan will be implemented. He referenced Page 5 of the North City Sub-Area Plan Draft which lists specific actions, and said he would like this process to result in a more articulate set of strategic actions with phasing or time frames and responsibilities identified. The City, as a public agency, needs to understand their role in assisting the implementation.

Mayor Jepson referred to opportunities for tax abatement. He noted that in redevelopment around the country, tax abatement is a big issue. The City’s percentage of the property tax is so small that it would not be a significant waiver. If the City wants to spur economic development and long-term sustainability, they should approach the other jurisdictions to see if they support this type of approach.

Commissioner Monroe said that there are certain types of land uses that would not generate a cash flow substantial enough to pay the rents that are necessary. The types of businesses that are encouraged in this area need to be able to generate sufficient cash flow to make the rents realistic. Also, they must consider the types of ambiance they need to attract people to the area to spend money.

Commissioner Marx pointed out that on Page 15 of the North City Sub-Area Plan Draft there is a typographical error. The amount of sidewalk should be 50 feet and not 75 feet.

Commissioner McClelland suggested that there may be many people living within walking distance, but there is no guarantee that they would come to the area to shop. She suggested that a more in-depth market study should be done to identify the people who are living in the area and match their needs with the types of services and businesses that are constructed. She concluded that retail businesses cannot succeed without housing opportunities. The Market Analysis should be much deeper before they ask the merchants to invest more money into development and improvements. But she agreed that the proposed plan is an excellent step in the right direction.

Councilmember Ransom said his main concern is the Market Analysis. He pointed out that the North City area is the poorest in the district. The residence of three of the four areas identified in the plan are lower income. The study indicates that the average family income in the area would be $60,000 per year by today’s standards. The reality is more likely $40,000 per year. That means the whole marketability for the area is grossly over estimated. A 1,000 square foot home, based on the study, would be $170,000. There would be a completely different clientele living in the new homes than the people living in the residential areas now. He suggested that this may end up displacing the current residents.

Ms. Kolousek commented that the Leland Consulting Group is one of the most reliable firms in the region. They have done extensive work for jurisdictions throughout the area.

The Commission continued to discuss the issue raised by Councilmember Ransom regarding the demographics of the people who live in the area now, and those who would move in if the proposed mixed-use development is implemented.

The meeting was adjourned at 7:50 p.m.

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Marlin J. Gabbert
Chair, Planning Commission

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Lanie Curry
Clerk, Planning Commission