City cancels $365K debt owed by absent tenant

Tacoma City Council Tuesday cancelled nearly $365,000 in outstanding debt owed to the city by a tenant that once leased office space on property owned by the City of Tacoma and located on the east side of Thea Foss Waterway.

According to a resolution that was approved by City Council on Dec. 6, the city purchased a parcel of land in April 2007 — as part of the development of the Center for Urban Waters — that included the offices of Bayview Industries. By purchasing the property, the city inherited a lease with Bayview Industries. But in January 2008, the company stopped paying rent, according to the resolution, and was declared non-operational by the Department of Revenue in June 2010. The city began an eviction process against the business. It filed a complaint for unlawful detainer and obtained an order of default and accompanying judgement in the city’s favor.

In the end, the company had accrued $364,680 in past due rent and late fees.

“The city exhausted collection efforts and subsequently hired an investigative attorney who determined that the tenant had no asset resources available to justify continued collection efforts,” said Assistant Public Works Director Mike Slevin. He added the resolution would “recognize the inability to collect on this account.”

“Just to clarify, the city did everything humanly possible to try to collect on this debt, but was unable to do so,” asked Mayor Marilyn Strickland before council voted to approve the resolution. “This will have no impact to the general fund?”

“Correct,” replied Slevin.

On Nov. 2, Tacoma City Council’s government performance and finance committee approved a recommendation that the full city council approve the resolution and cancel the debt.

The Tacoma Municipal Code requires city council approval to cancel debts greater than $25,000.