Time to conduct ‘due diligence’ focus of Skippers counter offer

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The Edmonds City Council spent nearly two hours in executive session Friday morning considering a counter offer from Cascade Bank in response to the council’s $1.1 million offer for the vacant Skippers restaurant property across from the Edmonds ferry terminal.

The bank’s counter offer didn’t involve a change in the purchase price, however. Instead, it addressed the amount of time the city can take to conduct its “due diligence” activities on the property before deciding whether to actually buy it. The city had originally requested 90 days to perform due diligence — activities such as an appraisal and environmental assessments — but the bank had countered with a 60-day period.

After the council emerged from executive session to take action in public, it voted to direct Mayor Gary Haakenson to submit a counter offer that would give the city the option of an additional 60 days — beyond the original 60 days the bank requested — if a more extensive environmental assessment is required. The vote was 4-1, with Councilmembers Steve Bernheim, Michael Plunkett, Diane Buckshnis and Adrienne Fraley-Monillas in favor, D.J. Wilson against, and Strom Peterson and Dave Orvis absent.

The council decided to put off a decision on securing professional services to actually conduct those due diligence activities until the property is officially off the real estate market. Councilmember D.J. Wilson noted that the bank does have a second offer from another potential buyer, which is for less than the council’s offer of $1.1 million but would involve a two-year contract rather than the city’s offer, which would be in cash.

The bank was scheduled to receive the city’s counter offer and the other offer Friday afternoon. It has two days to respond, so the city should know prior to next Tuesday night’s council meeting whether the counter offer was accepted.

Meanwhile, Mayor Gary Haakenson said Friday afternoon that he hasn’t ruled out the possibility of exercising veto power over the purchase when the time comes. While the mayor doesn’t have the authority to veto the actual purchase and sale agreement, he could veto any ordinance the council passes to raise or spend the money, such as a bond sale or designation of city funds.

A mayoral veto would force the council to revote and obtain a “super-majority” vote of 5-2. Since the council’s original decision to make the offer on the Skippers property passed by a 5-2 vote (Wilson and Peterson dissenting), one member would have to change his or her position for Haakenson to “strongly consider a veto,” he said. “Even if the vote remains 5-2, I will still strongly consider it just to make them take one last vote,” the mayor added.

11 COMMENTS

  1. Correct me if Im wrong but the council told the public they were look at the property,and were going to have it checked out thats soils test and appraisals, did anything change am I missing something here. I would believe about half of what the bank says call there bluff, this is a move by the bank to get the city to get the city to jump just slow down check the property out get everything in order financing etc and then decide weather you want it or not, I wasn’t there I don’t know but if what you say is true Ron the council is acting like a teenager buying his first car in a used car lot

  2. The council met this AM and voted 4 to 1 to counter the bank’s counter offer to the city’s $1.1M offer. The bank had countered because they wanted to shorten up the city’s due dilligence period-as I understand it, nothing to do with price.

    I believe that the city’s latest offer has the $1.1M contingent upon the city receiving an appraisal that supports that price. If that’s the case, then the city has unwittingly made an offer that the bank will not accept. Allegedly the bank has an other offer just below the $1.1M. If that’s the case, then they will take that offer because they know that the city will not get an appraisal that supports a price of $1.1M.

    What this all comes down to is that we no longer have a city council that represents the vast majority of Edmonds citizens, since they have chosen to totally discount the overwhelming oppostion to the city purchasing this property.

  3. Mr. Plunkett made a failed attempt this morning to paint a picture of a council that’s doing everything relative to the property purcahase in a real logical sequence.

    The bank’s counter offer bailed them out of their flawed first start; now their second go at it is closer to being an appropriate sequence – except that they should have had an appraisal of the value of the property before submitting a price. They’ve been discussing this purchase since at least March 16th, so they’ve had more than ample time to have it appraised.

  4. @Ron;
    You made a very key statement there. The Council has been discussing this since at least March 16th. However, the five in favor of the purchase persist in claiming that this is an “opportunity”, that just came along. Therefore, they had no time to really figure out how the land could best be used, or to do any “visioning”.
    I submit that, even now, there is time (and available talent) to figure out some uses for the property, so that there is at least a small amount of cost/benefit analysis – which is the standard method for discussing capital purchases by governments and non-profits.
    The Cost/Benefit of this purchase could be compared with estimated Cost/Benefit for other projects that the Economic Development Commission is working on. This is how governments are supposed to spend money. Not by “Ready, Fire, Aim!” targeting.
    As no analysis has been done to justify any aspect of this purchase, and NONE of the Five have even proposed public brainstorming on uses for the site, this entire process appears more each day to be a “taking” from the public, without prior notice.

  5. By the way, all citizens are encouraged to contact the Edmonds City Council members to let them know your opinion on this purchase. If your opinion is not heard by them directly, they cannot know the will of the public. Despite the online poll on this site.

    You can email the Council directly, using their email addresses posted here:
    http://www.ci.edmonds.wa.us/cityCouncil.stm
    Click on each Council member to get their email address, or you can also email the Council Administrator at counciladmin@ci.edmonds.wa.us

  6. These first five comments comprise 90% of the claptrap these same individuals have previously offered. Their repitition is flat boring. Is “mike” not really Michael Young? And if so why doesn’t he properly Identify himself?

    I trust our elected City Council will make a reasoned final decision, with claptrappers Wilson and Peterson talking negatively incessantly.

  7. Ray;
    Saying the truth repeatedly, makes it no less true. I won’t spice it up with misguided personal attacks and such – that doesn’t move the City forward. I want to jump-start improvements in our City to raise employment, broaden our economic base, and keep Edmonds a place where we CAN continue to live.
    This purchase, while a great idea if only considered by itself, cannot be considered alone. We must use the short time between now, and when we’re committed to coughing up all of the money, to make sure that we don’t have better uses for that money, time, and effort. The public is owed a diligent pursuit of cost/benefit analysis before our money is spent.
    If you find it boring to speak of rigor in our public finances – I think you might be in the wrong Washington.

  8. Yesterday (Friday) my wife and I walked aboard the ferry to visit Kingston. It was about 5pm and we went right by the Skippers site to board. Well I dunno who in the right mind would view the site as a park, or how anyone would enjoy sitting there in a ‘park-like fashion.’ First the commuter than Amtrak trains came tooting and rattling by. The ferry line was backed-up from the ramp around to the toll booth. Engines running, traffic then moving forward, etc. And then there’s no view of anything other than the ferry terminal and RR crossing gates. It’s your proverbial pig-in-a-poke as a park site.

    Of greater need, I believe, is raising revenues so that our city employees, the ones who make the City work, are not required to take furlough days any longer. This to me is an ethical issue that we’d choose a plot of bad dirt over their salaries. How long are employees willing to work at less than full pay? And how much longer do we require that before some leave? We already ask a lot of them, many managers spend long hours @ Council functions, yet there’s no groundswell to fix this greater problem.

  9. Jim Go on the city website and look at the two job openings the city just had there are not paying out like there hurting

  10. Shouldn’t an element of the due diligence process be assessing if citizens believe this would be a prudent purchase? Comments were taken at the April 20th and 27th council meetings. 36 different citizens spoke at those two meetings. 24 oppose the purchase and 12 support it.

    A poll on this website has been operating since April 23rd. The results have remained virtually the same for the past week. Only 15% of the participants favor the purchase.

  11. No Ray, this is Michael Young. I always sign things “Michael” but now I’ll add my family name so you don’t get so upset. I hope the extra syllables don’t tire your lips too much as you read them. I know it’s confusing that there is more than one Michael in the city of Edmonds. I’ll talk to my parents about that.

    Oh, and claptrap is doing due diligence after you offer money for property you can’t afford and don’t have a plan for. Or perhaps claptrap is screaming “tall buildings” every time you see someone you disagree with. Or repeating things you like to hear over and over again because your idea of a debate is saying the same things with no basis in reality over and over again repeatedly and repetitiously.

    People like you who refuse to engage in a discussion of facts and instead degrade instantly to name calling and scare tactics cheapen the experience of those who wish to engage in civil discourse. You do the city, your fellow citizens, and yourself a great disservice.

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