E-mail To The Editor: Mayor Debbie Klosowski Recaps Town Center Financing Discussion

The tool would help redirect state money to the project's infrastructure.

Obtaining additional grant dollars to help pay for Town Center improvements such as roads, parking and streetlights are among the options being considered by the University Place City Council.

Back in 2009, the State Legislature created a Local Revitalization Financing (LRF) demonstration project which enabled several cities, including University Place, to access additional funds for economic development purposes.

Under LRF, a portion of the state’s share of local sales taxes are redistributed to the City. Right now, all residents pay 9.3% sales tax. LRF does NOT change the amount of sales tax collected; instead, it merely shifts a portion of the state’s money to the City for economic development purposes. The Legislature created LRF to help cities become more competitive in attracting businesses, which in turn, will increase revenues to the state in the long run.

Several steps are involved with the LRF process:First, the City must designate a “local revitalization area” where public investments will be made. The City Council did this in 2009 when it designated the Town Center zone area on both sides of Bridgeport between 35th and 40th.

Next, the City must issue bonds – in this case, revenue bonds. Revenue bonds are only payable from aspecific source, which in this case is the State. The revenue bonds will NOT be secured by any City funds or property or in any way affect the credit of the City. In other words, there is NO risk to the City.

To further insulate the City from any liability, the City will create by ordinance a separate “City of University Place Town Center Project Authority."  This new authority will serve as the financing vehicle of the project. The authority cannot take any other action other than issuing the revenue bonds. Members of the City Council will serve as board members. Creating a public authority will ensure that the City and its taxpayers have no liability or responsibility for paying the bonds. Instead, the bondholders can only look to State funds.

After the authority issues the bonds, the City Council will take action to approve a City sales tax and reduce the State’s sales tax by an identical amount. Again this will NOT raise the sales tax rate; instead, it will reallocate a portion of the State’s share of the money collected and redirect it into a special account within the City. The actual amount available for economic development is anticipated to be $5-6 million, but will depend upon the interest rate at the time the bonds are sold.

Council action on this issue is slated for June 20. For more information, please contact Eric Faison, Executive Director for Finance and Administrative Services, at 460-5443 or efaison@CityofUP.com

Other meeting topics included:

*“What’s UP” Community Meeting – Join City Manager Steve Sugg to learn about the Town Center project and the City’s financial status followed by a question and answer session on Thursday, June 16 from 7 p.m. to 8:30 p.m. at City Hall.

*Town Center – Several prospective tenants and developers are showing strong interest in the City’s properties; however, the current economic situation has resulted in an extremely competitive environment, according to Town Center broker Jeff Kraft. For example, other commercial owners with vacant spaces are offering prospective tenants reduced rates. Bank financing is also difficult to obtain.

Town Center marketing efforts are continuing with an emphasis on obtaining an anchor, as well as a potential master site developer who can build spaces to lease out to tenants. (This option is still viable because several retailers expressing interest have indicated they prefer to lease, rather than build).

All Town Center properties are for sale. However, the City is pursuing a “conditional sales” approach, rather than a “surplus fire sale” method. Under a conditional sales approach, the City is seeking specific developers and uses that meet the vision of providing quality stores, restaurants and services while raising sales tax revenues. Other conditions include a buyer commitment to build a particular type of use within a certain time period, versus allowing someone to build and operate anything allowed by the zoning or sit on the property for an indefinite time period.

*Finance Update – Since incorporation, the City has issued bonds to fund a variety of projects such as park land acquisition, street improvements, and most recently, infrastructure improvements for the Town Center including streets, sidewalks and parking. It is common for cities to use debt to pay for major projects that benefit residents now and in the future.

From the start, the City has maintained a long term debt reduction plan to meet all of its financial obligations along with providing essential services. Because the Town Center Project has not progressed as quickly as originally anticipated, to maintain flexibility, the City will refinance a short term Town Center bond to a longer term bond. The City Council is committed to conservative financial management of its bonded indebtedness while keeping a close eye on revenues and expenditures to ensure that we can continue to provide essential services.

*Sidewalk/Park Grants – Sidewalks, bike lanes and more park land are in store for our community thanks to three recent grant awards. According to City Engineer Jack Ecklund, the City successfully competed for two more Safe Routes to Schools grants to improve sections of 27th Street West as well as Beckonridge Drive.

Several improvements are slated for the north side of 27th Street between Grandview Drive and Bridgeport Way, including sidewalks, curb and gutter, bike lanes, streetlights, landscaping , radar feedback signs and a pedestrian signal at Sunset and 27th. The $910,000 grant award has a local match of $100,000, which will be provided by Dale Fonk, the owner of Grandview Plaza located on 27th and Grandview. Mr. Fonk’s contribution is a “win win” because the improvements will benefit future development on his property.

A similar project will occur on the west side of Beckonridge Drive leading to Sunset Primary between Cirque and Grandview. The $830,000 grant has a local match of $70,000, which includes $30,000 in-kind labor and $40,000 from the surface water management fund which can only be used for that purpose. Public meetings will be held this year with construction likely next summer.

Public Works and Parks Director Gary Cooper also reported a Conservation Futures grant for $685,000 and a State grant for $65,000 (restricted for park acquisition) to acquire the 15-acre Tacoma School District property near Cirque and Alameda, which will provide a critical linkage in a future citywide trail system along with additional recreational opportunities for residents. Kudos to our staff who spend countless hours beyond their usual “day” jobs to pursue these grants! 

*Congratulations to Curtis High School Student Ashlee Stine who will represent the USA at the Special Olympics 2011 World Summer Games in Athens, Greece!

*Municipal Court Report – Public Safety Commissioner Michael Smith updated council on the recent contract with the City of Lakewood to provide court services. Baseline information is being collected and, so far, the arrangement is working well.

*Appointment of a Traffic Impact Fee Committee to review and evaluate traffic impact fees. Members include Planning Commissioners Sue Harwood, Cliff Quisenberry and Christine Saunders along with Economic Development Commissioners John Siridakis, Rick Larson and Chris Nye.

*Welcome to new U.P. Deputies Adam Pawlak and Ryan Johnson along with newly appointed Police Investigator Doug Shook

*CHIPS – A “U.P. Heritage Center” with meeting rooms and museum space featuring information about the community’s agricultural past are among ideas offered for the Curran House. CHIPs representatives Hank and Linda Tanz  indicated the group is not willing to take over financial responsibility of the Curran House at this time; however, they are continuing to pursue other grant and fundraising opportunities along with nominating the house for the National Registry of Historical Places.

Ducks & Flowers – Thanks to everyone who made Duck Daze a tremendous success along with the volunteers who spent Memorial Day weekend planting flowers along Bridgeport Way. (I’m sorry to have missed this year’s event due to an out of town family commitment; however, I was definitely there in spirit, especially after discovering an extremely large yellow paper mache duck lurking near downtown Ellensburg!)

*Emergency Planning – City staff recently updated the City’s emergency operations plan along with instituting quarterly first responders meetings. Our Public Safety Commission is also encouraging all citizens to take the emergency preparedness survey at www.CityofUP.com to learn if they really are prepared!

As always, I welcome your questions and comments. Please feel free to contact me atdklosowski@CityofUP.com.


Debbie Klosowski,


City of University Place


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