The Edmonds City Council voted Tuesday night to authorize Mayor Mike Nelson to sign an option agreement for the possible future purchase of a 10-acre site at the southern edge of Edmonds’ Highway 99 neighborhood. The discussion and vote, however, reflected some councilmembers’ concerns about the proposal.

The final vote was 3-1, with two abstentions. Councilmember Susan Paine was absent from Tuesday’s meeting.

Nelson announced during a June 22 press conference that his administration would be seeking council authorization to sign an option agreement with the Burlington property owner — Eastern Investment Corporation and Southeast 888 Investment LLC. The agreement includes a refundable deposit of $100,000 to hold the property for six months, which would give the city time to conduct public engagement and further study the idea. After that first six months, the city would have an additional year to decide whether to complete the purchase.

While no specific uses have been determined for the property, some ideas have included a police substation, senior housing or other community services.

With the option agreement, the owner is agreeing to not place the property on the commercial market, giving the city time to conduct community engagement and explore funding and partnership opportunities.

Three city department directors — Angie Feser of parks, recreation and human services, Todd Tatum of community and economic development, and Susan McLaughlin of planning and development — appeared jointly before the council Tuesday to explain the proposal and answer questions.

“There is going to be — if this moves forward — a community visioning process of master planning the site,” Feser said. “We really want this property to be a vision from the community. We want a lot of engagement with our public as to what they want in the site and what they see happening there.”

Calling it “an opportunity for reinvestment and revitalization,” the site “also has great opportunity for public-private partnerships,” Feser added.

There are three basic phases of the agreement. The first lasts up to six months and would include community engagement, “due diligence, looking at funding options, partnerships,” Feser explained. By the end of the six months, the council would need to decide whether to exercise the option agreement, which would allow for another 12 months of work.

During the next 12 months — during which the $100,000 would no longer be refundable — work would continue, with the city “really getting into the funding options of how to pay for this property,” Feser said. If the council decides within that 12 months to enter into a purchase and sale agreement, an earnest money deposit of $1 million is required. There is an additional six-month period after that to close on the property, she added.

Tatum said the city has developed an integrated project management plan. “This really does have a big impact on staff and the city’s priorities,” he said. “We also need to plan for that.” One of the first steps is to create a steering committee that would include the council president and another councilmember to oversee planning for community outreach, stakeholder engagement, budgeting and the project timeline, Tatum added.

Stating he worried about overburdening city taxpayers, Councilmember Dave Teitzel asked if it would be possible to purchase less than the 10 acres in the agreement. Feser replied that the owner wanted “to sell all of these at once — as a group, as a unit.”

Funding could take a number of different forms, including county, state and federal grant dollars. Another option that has been mentioned is tax increment financing (TIF), which “allows a city to collect revenue on the increased value of properties at the normal tax rate, bond against the expected future tax revenue, and use those funds to construct the designated infrastructure improvements,” the city said in an FAQ webpage devoted to the project. “Tax rates in the area do not rise, but the city will collect more revenue due to the increased property values created by the infrastructure improvements and new development.” Once the bonds are repaid, the city said, the increment area is dissolved, and taxation is distributed per the normal percentages to schools, ports, counties, and other entities.

Under the terms of the agreement, at least 75% of the property has to be used for public purposes. The city also has the ability to sell the property to other entities later if it doesn’t want to continue being the landowner.

Councilmember Vivian Olson then moved to amend the proposal to state it is an opportunity to vet the property acquisition rather than a plan to acquire it. That failed on a 1-5 vote after councilmembers said the six-month option essentially does just that. Then, Councilmember Will Chen — who lives in the Highway 99 area — moved to reject the proposal entirely, arguing that the council needed to spend more time engaging with the area’s residents to determine what they want and need. Chen’s motion failed 2-4, with Olson also voing in favor. Councilmember Diane Buckshnis then moved to table the measure until the council could hold an executive session to talk about the property’s appraisal. That motion failed with a 3-3 tie vote.

Councilmember Jenna Nand, also a Highway 99-area resident, spoke frequently Tuesday night about the importanee of signing the agreement so that the city could fully explore the possibilities for the property. She moved to authorize the mayor to sign the agreement, to which Chen replied that an executive session should come prior to the approving it. Tibbott then called for an executive session, which lasted 10 minutes.

Returning from executive session, the council voted on Nand’s motion, approving it 3-1 with Councilmembers Nand, Teitzel and Tibbott supporting it, Olson voting no and Chen and Buckshnis abstaining. The agreement takes effect July 1.

Prior to approving the Landmark property option agreement, the council heard a related presentation from Planning and Development Director McLaughlin about a proposal for a Highway 99 Community Renewal Plan.

The goal, she said, is to promote positive redevelopment on Highway 99. “It basically unlocks tools for cities to use to really catalyze redevelopment in a community renewal plan area,” she said.

For example, a city can acquire, transfer and/or sell property for development that meets community needs, supports local businesses, and/or catalyzes investment. A city can also assist property owners, tenants and residents affected by redevelopment, and/or provide incentives for job creation and retention.

McLaughlin explained that prior to the construction of Highway 99, the area consisted of smaller parcels that promoted “a more walkable, livable neighborhood.” Also contributing to this neighborhood separation was the 1964 construction of the cloverleaf interchange connecting Highway 104 to Highway 99, she said. It’s possible that federal funds could be secured “to reconnect communities,” she said.

The report accompanying McLaughlin’s presentation calls it “an action plan designed to show evidence of blight that inhibits positive development, identify tools to mitigate blight through community renewal, and coordinate City-led projects to address longstanding problems particularly acute in the southern part of the (Highway 99) subarea.”

The use of the term blight drew a concerned response from Councilmember Nand, who pointed out that Highway 99 businesses provided considerable tax revenue to the city. She also asked whether a declaration of blight was wise “at a time we are trying to make outreach to a part of the community that has been traditionally underderserved.”

McLaughlin replied that the community renewal argument for the area would focus on the impacts that infrastructure projects — particularly the construction of Highway 99 itself — have had on neighborhood access and walkability. “It should not be a reflection on the success of the businesses along Highway 99,” she said.

There were also council comments related to whether the community renewal plan should be considered in conjunction with the Landmark property or separately. No decision was made Tuesday regarding whether to move forward with the plan.

In other business Tuesday, the council:

— Approved an ordinance related to the Washington State Legislature’s adoption of a Blake fix for drug possession. While the state Legislature addressed the issue during a special session, there is a one-month gap between prior legislation and enactment of the new law. The council action Tuesday night updates city code to incorporate the state fix so that it is effective immediately and can be enforced during that gap time.

– Approved a proposed audit to identify HVAC updates to bring the Frances Anderson Center into compliance with the Washington State Clean Buildings Act.

– Awarded a construction contract for $2.675 million to Laser Underground & Earthworks, Inc. for the citywide bicycle improvements and Elm Way Walkway projects. With a management reserve and other associated costs, the total project budget is $3.357 million.

– Postponed until a future meeting a discussion on a proposed increase in residents’ car tabs — from $20 to $40 annually.

Prior to the 7 p.m. business meeting, the council held a special 5 p.m. session in the City Hall Brackett Room to further discuss 2024 budget priorities. Parks Director Feser was invited to provide a staff perspective on the budget, and she stressed the importance of council and staff working together to reach common goals.

Then, councilmembers reviewed the results of a public survey on budget priorities, which had a total of 125 responses. A majority of those surveyed identified public safety as their top priority. When it came to balancing the budget, respondents said they would prefer the city increase user or service fees to do so, followed by reducing or eliminating services. You can see the full results at this link.

Councilmembers then were asked to focus on making a list of top budget priorities based on input received during the survey and recent budget meetings. Then, they broke into two groups of three, combining questions that were duplicates and putting them on Post-It notes.

Among the priorities mentioned:

Improving public safety in high crime areas.

Improving the response to medical and fire emergencies on the waterfront.

Ensuring prudent choices are made about contractor spending,

Determining how to better leverage volunteers.

Achieving a balanced budget without drawing down fund balances,

Reducing speeding on city streets.

Increasing human services to vulnerable populations in the city, especially on Highway 99

Obtaining positive environmental action on waterways and creeks.

Increasing beautification in all Edmonds business districts.

Improving walkability in all neighborhoods.

Prioritizing ADA compliance.

Reducing property crime.

The council won’t meet next Tuesday, July 4 due to the holiday. Instead, the meeting will be Wednesday, July 5.

— By Teresa Wippel