Bellingham City Council to cast final vote on waterfront

Posted by JOHN STARK on December 9, 2013 

Tonight--Monday, Dec. 9--Bellingham City Council is scheduled to take the final vote on waterfront plans and development regulations.

Under city legislative procedures, ordinances must pass votes at two different council meetings. The second vote is a formality in most but not every case.

There's no reason to expect tonight's vote to be much more than a formality, but those who are opposed to the plans are likely to show up for public comment period to raise their issues one more time, based on what I'm seeing on social media.

I've had a ringside seat at the waterfront planning process since before the Port of Bellingham assumed ownership of Georgia-Pacific's old mill site in 2005, back when the Waterfront Futures Group was sketching in the outlines of how the waterfront might be reshaped in the decades ahead.

Today, some people are insisting that "the public" hates this plan, but the public has never spoken with one voice on the waterfront, and the vast majority of city and county residents have never attended a waterfront planning meeting.

Before the first vote was taken on the plan last week, council member Terry Bornemann said he thought most people were ready to wind up the planning debate and on to actual development.

At this final stage, there is still a sharp divide between the visionaries who see the waterfront as an empty slate for the creation of a an innovative new community, and those who see idle real estate that needs new zoning and development regulations to enable a transition from heavy industrial uses to other things: parks, residences, offices, stores etc., with some industrial sites remaining in place. Those views are not necessarily contradictory, but the visionaries don't see enough of their vision embodied in the measures that passed the Port Commission and City Council last week.

Instead of a blueprint for a bright future, we are getting rezoning and the detailed regulations that go with it. While these land use regulations don't rule out anyone's utopian vision, they don't exactly guarantee it either.

Despite all the handwringing from the visionaries, today's likely outcome may have been inevitable for one reason: Money.

Nothing is going to happen on the waterfront until private investors step up with many millions of dollars. Anything that discourages private investment is going to prevent or delay redevelopment. 

That's why the "living wage zone" proposal never got much traction with elected officials. 

Renata Kowalczyk, who enjoyed the support of many Bellingham progressives in her unsuccessful race for a port commission seat, sounded no different from her opponent, Dan Robbins, on this issue: ""Why would any business locate at the waterfront if they could have more autonomy by locating across the street?" Kowalczyk said in a response to a questionnaire from The Bellingham Herald. "Many businesses in an economic downturn look for ways to keep their employees employed, even on a part-time or reduced-wage basis, instead of laying them off completely. In a controlled-wage scenario, this option would not be available to businesses and their employees."

Critics are also upset because the parks acreage included in the plan has been whittled down from early-stage hopes. Again, money talks. Parks are expensive, and park land is not on the tax rolls.

When the port first took over the G-P property, the port's initial plans for parkland set-asides were criticized as ludicrously conservative. I can remember a couple of prominent local real estate developers insisting that because this waterfront land was so tremendously valuable, the port needed to develop no more than a small fraction of it to recoup its investment, leaving the rest for public enjoyment.

But that was 2005. The real estate boom went bust. Downtown sites where investors had envisioned multi-story towers went back to banks via foreclosure. Today, it is not at all clear that developers and financiers will bid up the price of waterfront real estate. That means that the port's return on waterfront real estate sales or leases may not be enough to cover cleanup costs, much less the cost of installing and maintaining new parks. 

The city also depends on private development to recover its costs, via taxes. During the boom, many people assumed that tax-generating development would occur rapidly once city infrastructure was built, but the bust showed how risky this assumption was. Former Mayor Dan Pike saw the financial danger for the city if there was a long lag time between millions of dollars in city investment and the private investment that generates the tax revenue to cover city costs.

Kelli Linville defeated Pike's reelection bid and quickly took a more cooperative approach with port officials to get the planning process moving again, but the 2013 version of the development strategy calls for a go-slow approach on city investment that reflect's Pike's initial concerns.

The city's return on its waterfront investments could come in the form of property tax on lands the port sells, or leasehold taxes on lands that the port leases. The city also gets a share of sales and B&O taxes that would be generated once businesses are up and running on the site.

Parks, as well as streets and utilities, cost millions. Case in point: tonight's council agenda contains a bid award for Phase III of the Squalicum Creek Park project, with a price tag of $4.5 million.

Parks maintenance costs money too. At a recent city budget session, City Parks Director James King told council that the Greenways levy endowment income meant to help cover those costs has not been keeping up with the need.

There's a chance that what is eventually built on the waterfront will get at least grudging approval from some of the people who are unhappy today. To me it seems unlikely that developers will want to attempt some kind of plain-vanilla approach with cookie-cutter apartment buildings, shops and offices. There are plenty of places where that kind of thing can be done with far fewer complications and better freeway access. 

Some people fear creation of a low-wage tourist zone on the waterfront, but this isn't sunny southern California. We may get some tourist-oriented shops and restaurants, but developers are likely to focus on higher-wage job-creating tenants that make money 12 months a year, blue-collar or white-collar.

It seems even more unlikely that anyone will try to build a Bellevue-style wall of high-rises. Bellevue has two things the Bellingham waterfront lacks: I-405 and Seattle. Downtown Bellingham already has regulations that allow buildings to scrape the sky, yet the world's tallest building is still in Dubai, and Bellingham doesn't have anything listed on the top 39.

The development proposals submitted to the Port of Bellingham all seem to recognize the unique qualities of this site, and the need to create something unique that draws people to the waterfront--enough people to generate enough money to make financial sense of the project for both public and private entities.

 

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