Additional $90K needed for new downtown Tacoma parking lot

Tacoma City Council is scheduled to vote Tuesday on a purchase resolution that would direct an additional $90,000 toward a new parking lot that was recently completed on the former Sauro’s Cleanerama site in downtown Tacoma.

On Feb. 8, 2011, City Council awarded a $601,687.00 contract to Serpanok Construction, Inc. of Tacoma to turn the city-owned parcel located near South 14th Street and Pacific Avenue and adjacent to the the headquarters of DaVita, one of downtown’s largest employers, into a space for street-level parking. In January 2010, Gov. Chris Gregoire allocated $700,000 from Washington’s Strategic Reserve Fund toward the project in an effort to boost the local economy. Originally, the money was to be used to keep Russell Investments headquartered in downtown Tacoma. The site was going to be part of a so-called ‘super block’ should Russell Investments decide to remain downtown and develop additional office space. The company moved to Seattle last year.

According to documents prepared for the purchase resolution before city council this week, the additional money is needed for the “removal and remediation of an existing and abandoned asbestos-coated steam line; removal and remediation of an existing underground storage tank; removal of a section of road that included between eight to 12 inches of asphalt- and concrete-encased railroad ties on South 14th Street; and application of a non-slip coating on the wood timber walk to mitigate slip hazards.”

In a July 11, 2011 memo to former City Manager Eric Anderson, Public Works Director Dick McKinley wrote, “During construction of the project, Serpanok Construction, Inc. encountered several differing site conditions (changed conditions) that were not identified during the design of the project.” In addition to the items listed above, McKinley noted the city instructed the contractor to “place additional bollards, reconstruct a curb ramp at the intersection of South 14th Street and Court A to meet the requirements of the city’s curb ramp matrix, and to extend the retaining wall at the southwest corner of the property to better address wall tie-in to the structural sidewalk.”

The city will be reimbursed for the cost overruns through a Washington State Department of Commerce grant.

The site of the parking lot has a long history in downtown Tacoma. It was once home to a store, bus terminal, and boarding house. But for 50 years, it was home to Sauro’s Cleanerama. After Sauro’s closed, the lot was abandoned for more than a decade due to a toxic legacy. On Sept. 23, 2008, the city purchased the property, which included 1401, 1407, and 1409 Pacific Ave. On Jan. 27, 2009, the city entered into an agreement with the Washington State Department of Ecology to accept $550,000 from the former property owner for future clean-up of the site. In May 2009, the Washington State Department of Ecology released a report that showed the site had “levels of the dry cleaning chemical perchloroethylene and its breakdown products in the soil and groundwater that exceeded state Model Toxics Control Act clean-up standards.” On July 21, 2009, the city awarded $1,759,900.41 to Clearcreek Contractors to initiate site clean-up. On Sept. 15, 2009, the city accepted a $1.35 million grant from the Washington State Department of Ecology to complete the funding for site remediation.

Similarly, City Council is scheduled Aug. 2 to vote on a resolution that would begin charging drivers to park at the new city-owned, 35-stall parking lot. If approved, the resolution would authorize Republic Parking Northwest to manage the lot. Drivers would pay an initial rate of $2.50 per hour, and a rate of $125 (plus tax) to park there monthly. According to a July 11, 2011 memo from McKinley to city councilmembers, the parking lot is expected to generate $60,000 annually in revenue, and the city will pay Republic Parking Northwest 1.5 percent of net revenue. The city will also reimburse the contractor for ‘out of pocket’ expenses related to operating and maintaining the parking lot. The resolution before the council Aug. 2 would also authorize Republic Parking Northwest to manage a city-owned, 50-stall parking lot located at 303 East D St. on the east side of Thea Foss Waterway and across the street from the Center for Urban Waters. The lot is currently used by the city’s environmental services department. Drivers would pay an initial rate of 75 cents per hour, or $4 per day, and a rate of $50 to park there monthly.

According to McKinley, the city owns seven parking garages and two surface lots with approximately 2,500 public stalls throughout the downtown area.

The decision Feb. 8 to award a contract to build a parking lot on the former Sauro’s site was made by a vote of 6 to 3, and was preceded by questions from several councilmembers who asked why the city was creating another parking lot in a downtown already teeming with parking lots.

“I hear it a lot from people who come to Tacoma: ‘How come there aren’t underground parking garages?’ Other cities have them and Tacoma seems to have above-ground parking garages,'” said Councilmember David Boe during the Feb. 8 city council meeting. He noted that cities such as Seattle and Bellevue are built on fill, making it easier to dig out space for underground parking. Not so in Tacoma, where most of downtown is built on hard rock. “[The former Sauro’s site] is just perfect on Pacific Avenue, half a block from the light rail station, you could not ask for a better freeway access off of I-705 and the exit ramp. It is already a 20-foot-deep hole with the alley being 10 feet below Pacific Avenue right now. So to put in a level or two or three of parking is a developer’s delight.”What I am having difficulty with — and have had difficulty since this project has gone forward — is we are filling the site, which means we are making it less desirable for development,” added Boe. “What that means is we’re taking $700,000 or $601,000 and putting all of that into the site [and] filling it, which means any time it is going to be developed, you have to take all of that away. You have to take the rock wall away, all the fill away. So from a development standpoint, from a city access standpoint, we have devalued that site for economic development and I think there are other ways we potentially could have achieved the goal of the grant.”

But building a parking lot on a site adjacent to DaVita, one of Tacoma’s largest employers, was part of a plan to keep the company’s headquarters downtown. Mayor Marilyn Strickland said she spoke with DaVita’s president last year and he told her adding a parking lot next to their headquarters was an expectation they had based on their discussions with the city. “We’ve worked so hard to create a positive business climate and are still trying to get there,” added Strickland during the Feb. 8 meeting. “Now to go back on our word to a business that stayed here, it shows bad faith.”

In his weekly report of Feb. 24, 2011, former city manager Anderson responded to these concerns by citing a number of reasons to turn the site into a street-level parking lot.

“The city worked for about 1.5 years or so with representatives of developer Erivan Haub to incorporate the site into the plans to accommodate Russell Investments’ future growth,” wrote Anderson in his report. “The city received an inquiry to develop a two-story structure on the site, but the proponent was in the early stages of exploring alternatives and could not provide sufficient information to move forward with a viable proposal. The city included the site on its developer tour in April 2010. The city has not aggressively marketed the site due to the downturn in the economy and the glut of office space on the market presently. Also, lease rates for existing space are far more competitive than those for new construction.”

Anderson also noted that when Russell “announced its departure from Tacoma, the governor directed her staff to work with the city to repurpose the funds so long as the use met the legislative intent of supporting job creation. DaVita stated that parking was critical for it to remain and expand in the downtown. The city proposed that it would assist the company with parking.”

Finally, Anderson noted turning the site into a parking lot serves the spirit of the original grant: “The city submitted the $700,000 construction grant on May 21, 2010. The grant summary states that the city shall restore three parcels for immediate productive re-use and future private redevelopment. Immediate productive re-use was further defined as interim parking use on the city-owned property to support DaVita’s employment expansion at its regional headquarters. Activities included, but were not limited to, site, street and sidewalk infrastructure improvements . . . in addition to sidewalks at Pacific Avenue, South 14th Street and Court A.”

Anderson’s notes in his Feb. 24 report were similar to those made in his June 24, 2010 report to City Council, where he outlined some of the caveats associated with using the money to develop the site. According to the report (published verbatim here):

— Developers would not be able to use the $700,000 grant because State funds cannot be used for a private purpose. The Washington State Constitution prohibits the lending of public credit for private gain. The Governor’s Strategic Reserve Fund is to be used for publicly-owned infrastructure needed to assure job retention or creation;

— Construction of a two-level parking structure is estimated to cost $3.3 million to construct with a projected 30-year payback if stalls are leased at $125 per stall. This approach limits future building development because it lacks flexibility. It pre-determines the size and configuration of the future building footprint and may not allow for a larger building to be constructed;

— It is unlikely the city would yield the highest return on investment if the property were sold in 2010 for parking. It would forego the future value of the property when the economy recovers as well as the potential to negotiate quality development with significant tax base and job creation. It is conceivable that parking alone would remain during the long-term or a one- or two-story structure be built on the site, which would not support the highest and best use;

— Requests for proposals are time-consuming and do not guarantee there will be qualified responses. If the city intends to retain the $700,000 grant, it must begin its planning on the selected design alternative by the end of July in order to complete all work by June 30, 2011, which is the State contractual deadline.

Earlier this month, Tacoma political cartoonist R. R. Anderson marked the parking lot’s completion by holding a tongue-in-cheek ribbon-cutting ceremony. Under light rainfall, Anderson and a small group of Tacomans ‘celebrated’ what he described as “the $700,000 parking lot built on top of a $2 million clean-up site” by unspooling a coil of thin blue crepe paper and cutting it with a pair of garden shears. In a post on inviting people to attend the event, Anderson criticized the creation of another surface level parking lot downtown (the new parking lot is surrounded by four other parking lots) and wrote, “Since I’m guessing the City would prefer everyone just forget about this thing, maybe it would be fun to have an impromptu street-performance ribbon-cutting ceremony for this parking lot.” Anderson named the new facility the “Eric Anderson Memorial Parking Lot” after former City Manager Anderson, who was dismissed this month by City Council.

Tacoma City Council is scheduled to vote on the purchase resolution (#38297) during its meeting on Tues., July 26. The meeting will start at 5 p.m. and will be held in the City Council Chambers, first floor, Tacoma Municipal Building, 747 Market St. The meeting will be broadcast live on TV Tacoma and on . On-demand audio archives are available on the Web within 24 hours of the meeting at . For a copy of the agenda and meeting materials, click here — .

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A political cartoonist ‘celebrates’ downtown’s latest development . . . another parking lot (07/13/11) —

Sauro’s parking lot project nearly finished (06/28/11) —

Work begins on former Sauro’s site (03/29/11) —

City Manager: Several factors hindered Sauro’s site development (02/28/11) —

Tacoma City Council OK’s contract for Sauro’s site parking project downtown (02/09/11)–

Sauro’s site closer to becoming parking lot (02/08/11) —

Washington State economic development funds slated for downtown Tacoma (01/15/10)

Clean-up work begins on key downtown Tacoma property (01/30/09)