2008, 05-06 Study Session MinutesPresent:
Councilmembers:
Rich Munson, Mayor
Dick Denenny, Deputy Mayor
Rose Dempsey, Councilmember
Bill Gothmann, Councilmember
Gary Schimmels, Councilmember
Steve Taylor, Councilmember
Diana Wilhite, Councilmember
MINUTES
CITY OF SPOKANE VALLEY
CITY COUNCIL STUDY SESSION
Tuesday, May 6, 2008
Staff:
Dave Mercier, City Manager
Mike Jackson, Deputy City Manager
Mike Connelly, City Attorney
Neil Kersten; Public Works Director
Kathy McClung, Community Development Dir
Mike Stone, Parks & Rec Director
Rick VanLeuven, Police Chief
Steve Worley, Senior Engineer
Greg McCormick, Planning Manager
Greg Bingaman, IT Specialist
Carolbelle Branch, Public Information Officer
Chris Bainbridge, City Clerk
Mayor Munson called the meeting to order at 6:00 p.m. and welcomed everyone to the meeting, and
recognized and welcomed Spokane Councilmember Al French. Mayor Munson also mentioned that this
is "Public Employee Recognition Week" and he expressed his appreciation of staff's work and
professionalism; and Deputy Mayor Denenny added congratulations for Jennifer Papich's recent receipt
of the "Young Professional of the Year Award" from the Washington Parks and Recreation Association.
1. Affordable Housing — Ken Mewhinney and Chris Venne
Ken Mewhinney, Government Affairs Chair for Spokane Association of Realtors; Chris Venne,
Development Finance Manager of Housing Services Community Frameworks, and Spokane
Councilmember Al French (who is also an architect and real estate developer) gave a presentation on
"affordable housing." Mr. Mewhinney explained that affordable housing is not synonymous with "low
income housing" but is more in keeping with the meaning of what a person of average income in our
community can affordable for a home. Slides were shown of a "housing market snapshot" from selected
counties in Washington Sate during the fourth quarter of 2007, comparing the median resale price of
homes in Spokane County, King County, Pierce County, Snohomish County and Benton County, i.e.
$194,200, $439,000, $275,000, $375,000, and $171,600 respectively; and that a person with an average
annual wage of $40,000 can afford about $120,000 for a home. Mr. Mewhinney said that our County
greatly differs from median homes in King County of $400,000 and we don't have the same wages as
Seattle; but that in reviewing the Multiple Listing Service (MLS) list of available homes, only 10% are
under $140,000. He also mentioned hat the largest migrant group moving to our area are from California
and Arizona, and that U -Haul designated our area as the seventh most popular place to move to. Mr.
Venne said that they are concerned with the long -term trend as prices are escalating faster than income,
and what someone might be able to afford today, they might not be able to afford four years in the future.
Mayor Munson asked how many existing residents bought homes last year compared with how many new
residents bought homes, and Mr. Venne said he can get those statistics for Mayor Munson. Mr.
Mewhinney also remarked that the demand is less now for a new home, the supply is large, and therefore
prices have escalated; and that some current homeowners trying to sell their home must face the reality
that their home will not net as much profit as expected.
Further discussion and comment included mention of the GMA (Growth Management Act) and the
impact it has on housing; land prices almost doubling; construction costs escalating; needed
infrastructure; the diminishing luxury of larger lots; needing a joint partnership between those who deal
with real estate and the Cities in order to explore creative ways to control costs; possible incentives from
Study Session Meeting Minutes:05 -06 -08 Page 1 of 4
Approved by Council: 06 -10 -08
municipalities; bonus densities; and "community" or other types of land trusts that involve having a
separate owner for the home and for the land.
Councilmember Gothmann distributed copies and discussed his informational charts and graphs showing
"Housing Opportunity Index by affordability rank [source: NAHB /Wells Fargo Housing Opportunity
Index], and said we have space to grow and everyone has the opportunity to raise their income, and gave
the suggestion of teaching people how to get better incomes and how to save for homes; and said that
most first time home owners buy older homes; so there could be ways to help those who want to purchase
fixer- uppers. Mr. Mewhinney also mentioned that state bond programs are a possibility to help people
with fixer- uppers. Deputy Mayor Denenny asked about the market for the smaller, cottage -like homes,
and Mr. Mewhinney responded that they are very marketable, to which Mr. French added that a smaller
home doesn't mean less quality. Mayor Munson thanked the group for their presentation.
2. Proposed 2009 Transportation Improvement Plan (TIP) — Steve Worley
Engineer Worley gave a summary of the draft 2009 -2014 TIP, but added that this draft should be
considered a "work in progress" and will be updated again prior to the June public hearing. Regarding
the summary, Mr. Worley explained that of the 47 projects listed (there are some missing numbers), that
eleven have been funded on TIP grants or other grants, five are anticipated to be funded if the STA 3 /10
bond issue passes; twenty are presentation projects; four are extension projects; thirteen are planned for
reconstruction; and five of those thirteen are in the Greenacres area due to the anticipated growth in that
area which means increased traffic volumes. Mr. Worley added that the level of projects listed in this TIP
may not fit within the funding levels we currently have for road projects; and Mayor Munson said
Council realizes we can only do what we can afford.
3. Community Development Block Grant/Home Consortium Participation — Greg McCormick
Planning Manager McCormick explained that the County is now due to re- qualify for Consortium
Participation for fiscal years 2009 through 2011; that this requalification requirement results in Spokane
Valley being in the position to decide whether to renew its participation in the County's CDBG /HOME
Consortium, or become a direct entitlement recipient from HUD; and said that our City has been a
participant since 2004; and that for Spokane County to meet its obligation under the HUD requirements,
Spokane Valley must provide written notice of the City's decision by May 23, 2008. Mr. McCormick
explained that staff had discussions with Spokane County staff about Spokane Valley receiving a set -
aside amount base on historical CDBG awards. Mr. McCormick further stated our concern with funding
levels received for Spokane Valley, as last year saw only $77,000, although previous years have been as
high as $400,000; and that we have asked the County for a specific set amount for the city or a percentage
of the amount from the County's award, to be awarded and used for our capital projects; and that the
County seems receptive to that proposal, but asked if we would provide a letter formally requesting that
set aside arrangements be set up in the next three -year period; adding that the Board of County
Commissioners would make a decision to allow that or not. After discussing this proposal with Tim
Crowley of the County's Community Development Department, Mr. McCormick explained that we will
request that $300,000 be set aside for Spokane Valley Capital projects; and to allow us to actively request
funding in other categories competing with the remainder of the jurisdictions. Mr. McCormick also
mentioned that regarding timing, he spoke with Mr. Crowley who indicated that the County
Commissioners will likely be briefed on this issue May 13, with an anticipated action at their May 20
meeting. In response to Council question, Mr. McCormick said these set aside funds would be available
only for capital projects, which as Mr. Mercier pointed out, is the infrastructure category.
Brief discussion included council remarks in favor of this proposal; that we want to get the best
reasonable deal for our citizens; that we don't want to suffer with another repeat of the year we were
allocated $77,000; and rather than press for greater funding, staff feels the $300,000 is a reasonable
amount; that we will present a motion for Council to make a commitment for the next three -year cycle,
which starts in 2010; and that we will make it clear in the letter that this is a conditional proposal hoping
Study Session Meeting Minutes:05 -06 -08 Page 2 of 4
Approved by Council: 06 -10 -08
for a favorable reaction. As chair of the CDBG Committee, Councilmember Gothmann said he will likely
not chair that meeting, but would ask the vice -chair to preside over the meeting which will hear that issue.
4. Comprehensive Plan Schedule — Greg McCormick
Planning Manager McCormick reported that the Planning Commission held a study session last Thursday
night and reviewed the eight privately- initiated map amendments; that there were a number of text
amendments which are mostly clean up or updating data in tables; that a part of a few chapters will have
policy change recommendations by staff, and the most significant of those are in the Chapter 2 Land Use,
which addresses potential annexation areas, and to identify those Urban Growth Areas (UGAs) as
designated by Spokane County, which is an intermediate step between now and when the County updates
their plan. Mr. McCormick said the Planning Commission public hearing is set for Thursday with
another hearing date set aside for May 22 in the event the first hearing results in not enough time to hear
all public comments, and allow the Planning Commission sufficient time to review all recommended and
requested changes. In addition, Mr. McCormick noted that was an error in sending out hearing notices as
they were sent to the wrong list of people, so that had to be re -noted for the 22n but he stated he feels the
items can be ready for Council by a June study session. City Attorney Connelly added that to be annexed,
an area must be within the UGA, and that annexation must be consistent with our Comprehensive Plan,
and that our current Plan specifically excludes any growth outside our corporate boundaries; so that
section of the plan will need to be amended, then the issue will get pursued with the County to get them to
designate joint planning areas. Mayor Munson also mentioned that the GMA will be holding a public
hearing May 21 on amendments to County wide Planning Policies and Urban Growth Areas regarding
frequency of UGA amendment, and criteria for amending a UGA.
Further discussion included the CTED's (Community Trade and Economic Development) process of re-
writing WACS (Washington Administrative Code) implementing the GMA (Growth Management Act);
climate change actions and the GMA process; mention by Mr. Connelly of his previous annexation memo
and that he will re -send to Council for further review; mention of connectivity to make sure corridors are
identified for the basic street map; housing affordability and lot sizes for duplexes as some citizens have
complained about this issue; and mention by Mr. McCormick that while that issue is not scheduled for
this round of proposed changes, staff is checking for consistency between our comp plan policy in chapter
2 and our zoning regulations. Mayor Munson asked about the restricted lot size which will not allow
duplexes, and Mr. Mercier said that issue is dependent upon when the legislative body wants to revisit
that; and Mr. McCormick said it is on the list and is a UDC issue and therefore a timing issue as well.
5. WEDFA Tax Exempt Economic Development Bond, $30 million, Waste Management, Inc. — Dave
Mercier
City Manager Mercier explained that staff received a letter from Washington Economic Development
Finance Authority (WEDFA) seeking Council's support of a resolution approving WEDFA's issuance of
approximately $30,000,000 in non - recourse revenue bonds to finance a facility for Waste Management,
Inc.; and that this will not obligate the City for any revenues, nor would it replace any of the City's
normal permitting processes; and that there is no liability against the City by WEDFA's issuance of these
bonds. Mayor Munson recommended this item be placed on the Council's next consent agenda. Council
concurred.
Mayor Munson called for a short recess at 7:30 p.m. and he reconvened the meeting at 7:45 p.m.
6. Council's Six -Year Transportation Financial Goals — Dave Mercier
The following is the result of the discussion of possible six -year transportation goals, keeping in mind the
objective to "provide residents and businesses with a physically and financially sound local transportation
(street) system that meets their needs now and in the future."
Study Session Meeting Minutes:05 -06 -08 Page 3 of 4
Approved by Council: 06 -10 -08
ATTES :
VOTES:
7 Establish a sustainable funding option for (1) maintenance, and (2) preservation
5 Implement a plan for long -term maintenance and preservation
5 Develop an alternative plan based on actual revenues
5 Seek to develop legislative alternatives
5 Identify the basis of taxpayer resistance; identify ways to fill the information gap
4 Establish public information program for funding needs over six years
2 Establish timelines to accomplish goals
1 Utilize best practice in the expenditures of transportation dollars
1 Council exercise increased level of knowledge and resolve
0 Examine funding alternatives
0 Plan -cut general fund services to generate dollars for street fund
0 Be aware of regional funding requirements
0 Maximize efficiency of road staff
7. Advance Agenda — Mayor Munson
Council and staff discussed the May 13 Greenacres rezone item and determined that the Greenacres
statistics will be included as part of that issue, to discuss prior to the motion. Other items discussed
included the UDC items shown on the "pending items" of the advance agenda along with mention of an
upcoming tentative schedule for possible UDA amendments; Mayor Munson's request to include an
update on the purchase of the Valley Hospital for the June 3 meeting; and various law enforcement issues
that will be included for discussion at the June retreat.
8. Information Only: The Barker Road Bridge Bid Award and 24 Avenue Bid Award were for
information only and were not discussed or reported.
9. Council Check -in — Mayor Munson
Councilmember Schimmels said the Solid Waste group is in the midst of auditing the system, and would
like to choose a technical person to be on the committee, and that he would like the assistance of Council
and Mr. Kersten in ideas for such a person; and if possible, he would like to have a name (not a
councilmember or staff person) by next week.
10. City Manager Comments — Dave Mercier: No comments.
EXECUTIVE SESSION: It was moved by Deputy Mayor Denenny, seconded and unanimously agreed
to adjourn into executive session for thirty minutes to discuss land acquisition; and that no action is
anticipated afterwards. Council adjourned into executive session at 8:30 p.m. [Note: Councilmember
Schimmels excused himself from the executive session as he felt ill and went home.] At 9:00 p.m.,
Deputy City Manager Jackson announced that the executive session would continue for another estimated
ten minutes. At 9:05 p.m., Mayor Munson declared Council out of executive session. It was then moved
by Councilmember Gothmann, seconded and unanimously agreed to adjourn. The meeting adjourned at
9:06 p.m.
Lehfistine : ainbridge, City Clerk
Study Session Meeting Minutes:05 -06 -08
Approved by Council: 06 -10 -08
Page 4 of 4
Housing Market Snapshot'
Selected Counties in Washington State
Fourth Quarter 2007
24.170
1000
-174% -0110%
•122% 46.1014
Peri r
SwtyYtIra 1
114111141
-17.3%
.122%
- 419.110%
-1 70%
1112 !I U% 9 439,000
972 .190000% $ 275,000
410 4S.O i 591400
91 -40.10% $ 177.900
Searcy n %w. ore, COMP AY Rani 9/7• Atemard~hroa Rao tadrarftr
GI XP7
a 9501
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T I _11 . .. 11 T 1
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aerrw44 on a end4npMCm0 home Winn Ire *dal Is 100 Stare ie a baling* baboon M WHO
abet bland Piendsoits .R r momatbdabb
7iw rim, twer ario aeaama.04 purd1 Ms all M cot04 70% d Iftemedian hanahold moms
Home pu+cMwd Dr 9r*FMte burin to 95% otsnuff median prim and assume a 1044 down payment
turwmal Oaf 29%0114401111 can Nu / e0R alaedinbmiperRaRI
I _ 1.. II
a 9007 fa moil
112.1 404 11311
796 574 951
1212 Al 7 792
1756 697 10.1
Housing Opportunity Index: 4th Quarter 2007
By Affordability Rank
Metro Area
HOI 4th Qtr 2007 2007 4th Qtr 2007 4th Qtr 2007
Share of Homes Median Median Affordability
Affordable for Family Sales Rank
Median Income Income Price National Regional
(000s) (000s)
Spokane WA
Pocatello. ID
Great Falls. MT
Salem OR
Olympia WA
Corvallis, OR
Boise Crty - Nampa, ID
Bremerton - Silverdale WA
Tacoma, WA "A
Portland- Vancouver - Beaverton OR -WA
Eugene - Springfield OR
Mourn Vemort- Anacortes WA
Medford. OR
Bellingham. WA
Seattle - Bellevue- Everett. WA AAA
Bend, OR
648 a•
60.0 49 7 147 87 5
57.1 50.2 156 100 8
41.2 54.2 201 141 15
34.0 64 3 247 161 22
41 2 67 4 262 141 15
34 0 58.5 234 181 22
33.6 65 7 284 164 24
313 61.5 252 169 27
28 8 63 8 270 177 33
30.0 52.2 225 174 30
29 7 57.9 250 176 32
30 0 52 7 230 174 30
31 4 58 2 258 168 26
24 3 75 6 365 187 40
24.4 58 7 285 185 38
"A Indicate Metropolitan Divisions All others are Metropolitan Statistical Areas
Source of Data NAHBANeIts Fargo Housing Opportunity Index (HOI) 5/03/2008
611 Gothmann 5 -3 -08
Mortgage Rate 5.86 Percent
Mortgage Affordability Affordability
Payment Index Rank
803 19
694.52 149 1 2
737 04 141 9 3
949.65 118 9 4
116698 1148 5
123785 1134 6
1105.56 110 2 7
1 24730 1097 8
119061 107.6 9
1275 65 104 2 10
1063 04 102 3 11
1181 16 102 1 12
1086 87 101 0 13
1218 96 99 5 14
1724 49 91.3 15
1348 52 90.8 16
450000
400000
350000
300000
250000
200000
150000
100000
50000
0
1900 1910 1920 1930 1940 1950 1960 1970 ISO 1903 2000 2010
- Actual
- COO aitt ed
Spokane County Population Trend, 1 23% growth per year
Spokane
Spokane Valley
20 -Year Sizes, Spokane and Spokane Valley
Spokane: Increase 0.665 Miles
Spokane Valley. Increase 0.53 Mites
BIFJ Qothmartt►, 5 -5-0
Median Income
Index = X 100
Payment on Loan after paying 20% down on the median pnced home
Factors
1. Median Income
2. Interest rate
3. Median Pace of home
Housing Affordability Index
Source National Board of Realtors Web Site, 5 -5 -2008
Inferences
1. Need to work on income
2. Need to work on interest rates
3. Need to work on pnces
4 Develop strategies for saving for a new home
Interpretation. In general, first time home buyers will purchase older homes
First Time Homebuyers
'Price constrained buyers will tend to opt for older homes in their choice of neighborhood '
- --- Spokane Housing Workshop, Dec. 7, 2007, p. 3
Inferences:
1 We must preserve our older neighborhoods
2 Can we help those who want to fix up a home?
a Moving in while reconstructing - govemment regulations
b Low cost loans for remodeling
c Neighborhood restoration efforts
3 Counseling new homebuyers about owning a home
Bill Gothmann, 5 - 5 - 2008