2009, 05-05 Study Session MinutesAttendance:
Councilmembers
Rich Munson, Mayor
Dick Denenny, Deputy Mayor
Rose Dempsey, Councilmember
Bill Gothmann, Councilmember
Gary Schimmels, Councilmember
Steve Taylor, Councilmember
Diana Wilhite, Councilmember
MINUTES
STUDY SESSION MEETING
SPOKANE VALLEY CITY COUNCIL
Spokane Valley City Hall
Spokane Valley, Washington
May 5, 2009
Staff
6:00 p.m.
Dave Mercier, City Manager
Mike Connelly, City Attorney
Mike Stone, Parks & Recreation Director
Mike Jackson, Deputy City Manager
Morgan Koudelka, Sr. Admin Analyst
Greg McCormick, Planning Manager
Neil Kersten, Public Works Director
Ken Thompson, Finance Director
Scott Kuhta, Senior Planner
Lori Barlow, Associate Planner
John Whitehead, Human Resources Manager
Carolbelle Branch, Public Information Officer
Greg Bingaman, IT Specialist
Chris Bainbridge City Clerk
Mayor Munson opened the meeting at 6:00 p.m. and welcomed everyone to the study session.
Introduction of New Employees: Public Works Director Kersten introduced Kristin Peart, Public Works
Administrative Assistant, who has a BA in Business Management from Southern University, Utah, and
who worked several years in an architectural firm. Council greeted and welcomed Kristin.
Councilmember Gothmann said in reference to the swine flu, the County's new health administrator
began the end of last week; and Councilmember Gothmann said he wanted to acknowledge the
contribution of our Public Information Officer (PIO) Carolbelle Branch who assisted in the effort to
inform the community about the swing flu; that the Health Department had requested assistance from the
various community PIOs to help and the County's PIO Julie Graham said that Ms. Branch did an
admirable job and she reported it was a real pleasure to work with Ms. Branch; and Councilmember
Gothmann said he wanted to publicly acknowledge the efforts of Ms. Branch and of those other PIOs in
that endeavor.
Mayor Munson mentioned a change in tonight's agenda in removing agenda item #4 and adding a
presentation of the results of the recent National Citizen's Survey. Mayor Munson then welcomed
Spokane County employees Bruce Rawls, Angie Sanchez, and Kevin Cooke.
1. Wastewater Cost of Service Rate Study Update — Bruce Rawls, Angie Sanchez, Kevin Cooke,
Spokane County
Mr. Rawls explained that he came before Council a few years ago concerning a rate study and update
based on a cost estimate prepared in 2006; he explained that in January 2009, a contract was signed for
the design, construction and operation of a Wastewater Treatment Plant, and said the costs due to inflation
have far surpassed those 2006 estimates so the rates had to be reviewed. He mentioned they will gather
input from the Board of County Commissioners and this Council and refine their analysis and bring this
matter to the public in June to adopt whatever new rate structure is appropriate; he mentioned they
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anticipate selling bonds in late June, but a rate structure needs to be in place to support the bond issue.
Ms. Sanchez then went through the PowerPoint presentation explaining how the capital costs have (or
will) influence rates and charges; mention of several key general assumptions regarding the general
facility charge (GFC) including the estimated future 9,000 ERU (equivalent residential unit) connections
from the septic tank elimination program, and said the GFC full cost in 2010 will be increased by 3.5%
inflation thereafter; she explained the current $24.79 monthly sewer charge and what it supports; went
over six different scenarios of different rate /charges and mentioned some of the variables that impact
rates. Mr. Rawls said they have the budget to prepare six more scenarios if they get that guidance.
Councilmember Taylor asked how would the rates be affected if the per gallon operating costs were kept
as low as possible, for example, would it be less expensive to continue using full capacity of the Spokane
plant, and if so, what would be the reasoning to convert so much of that flow to the new plant? Mr.
Rawls explained that the City of Spokane doesn't have the information about future operating costs so
that would be a difficult scenario to formulate. Councilmember Taylor suggested the possibility of having
the pros and cons for running fully at the Spokane Plant, or running fully at the new plant with estimates
or best guesses. City Manager Mercier said it would be helpful to have an understanding of the value for
the least expensive treatment, and asked if Mr. Rawls had an opinion of which is the most economical in
the long term. Mr. Rawls said if they were to sell 25 -year bonds instead of 20 -year bonds, rates could be
less in the early years, but the ultimate total debt service would be substantially greater, and said he does
not have those total cost figures tonight; and added that twenty -five years is not the normal approach; and
said they know there will be 9,000 new conversions in the next few years as those people get off the
septic tank and into the sewer system; and said that he personally does not have an opinion as to which
alternative is the best. In answer to question about how that added capacity relates to borrowing, Mr.
Rawls said the capacity will be exhausted; and with the newest population figures, eight million will or
should take the capacity the twenty- years, which lends to more comfort using the twenty -five year
financing scheme; he said staff waits to see what preference the policy- makers will choose; and that they
will re- examine the interest rates as they may change between the twenty and twenty -five year. Mr. Rawls
also mentioned that the monthly rates would be applied equally to all customers.
Mr. Rawls further stated that the City of Spokane is doing a rate study now which is the first actual cost
of service rate they have conducted, as previously they did a simplistic analysis; and that the City of
Spokane hired an outside consultant, and that their rates should be roughly the same as here. There was
some discussion about the Saltese Flats and Mr. Rawls said they are preparing to run a model, but that
effluent disposal is a complex subject because of the amount of phosphorus left in the water; that they are
looking at an aquifer recharge pilot at the treatment plant but it might not be permittable as it would still
contain effluent. Regarding Mayor Munson's question of what if we don't get the discharge permit; Mr.
Rawls said he is optimistic about that but cautious, and has not run a scenario on the possibility of
building a plant and mothballing it. Mr. Rawls stated that when we get the discharge permit, the rate
structure would be good for three to five years; and if we can't discharge into the river in the summer, the
Saltese would be the best alternative. Mr. Rawls mentioned he would research zero capable bonds as
Mayor Munson suggested. Regarding negative comments heard concerning using the new phosphorus -
free dishwashing detergents, Mr. Rawls said he encourages people to try different products as some work
better than others, having a water softener helps; and mentioned a water conservation promotion will be
forthcoming, complete with rebates.
2. City Finance 101— Dave Mercier
City Manager Mercier said this presentation is also available on the City's website. Mr. Mercier explained
that the purpose of this presentation is to re- acquaint everyone with the nature of city finances; and for a
quick recap, he referred to the "2009 budget summary" page showing the individual fund balances,
revenues, expenditures, and anticipated fund balance; he gave the statistics for Spokane Valley in terms of
population, jobs, registered businesses, square miles of service area, miles of city streets, number of park
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and open space acres, and said we are the seventh largest city in Washington and the second largest city
in Spokane County. By means of charts and graphs, Mr. Mercier showed how the budget resources are
divided; the 2009 general fund revenue per capital compared with other cities such as Yakima, Spokane
and Federal Way; how the 8.7% sales tax is allocated noting that 6.5% of that goes directly to the State
and only .85% comes to our City; compared 2008 property tax rates in cities such as Yakima, Spokane
and Federal Way with Spokane Valley's rate of $1.50 as the lowest rate only after Deer Park, and said
that Spokane City has the second highest rate of $3.80 second only to Spangle with a $4.84 rate per
$1,000 assessed valuation. Mr. Mercier showed how Spokane Valley's $1.50 property tax rate compares
with rates for other districts such as West Valley School of $5.82, Spokane School of $4.34, and Central
Valley School of $4.10; and explained that with a $164,325 Spokane Valley median house value and a
property tax rate of $1.50 per thousand of valuation, this breaks down to a $246.49 annual cost to a
Spokane Valley homeowner to cover the cost for police protection, street maintenance and repair, parks
and recreation, general government and more. With an annual rate of $246.49 or $20.54 per month, Mr.
Mercier explained this can be compared with other consumer monthly costs such as $40.00 for Internet
service, $35.34 for sewer, $32.50 for basic cell phone, $18.15 for basic garbage removal, $15.00 for basic
Internet, $18.00 for cable, $22.00 for basic telephone service, and $34.99 for premium channels. In
comparing the City's 2004 expenses with 2009 expenses, Mr. Mercier noted our capital projects increased
$17 million, operations increased $11 million, and debt decreased $100,000; for a difference in actual
expenditures of an increase of $28 million over the six -year period, and said whereas in 2004 we carried
over $2.9 million in unspent funds and reserves, we carried over $34.4 million in 2009 in unspent funds
and reserves; and mentioned that these figures include the millions of dollars the City receives in grants.
Mr. Mercier continued by explaining that this City has weathered and is weathering the current economic
storm through sound financial management by maintaining basic service levels with reduced resources,
minimizing personnel overhead by contracting, having a six -year business and budget plan, leveraging
city funds with grants, minimizing debt, and spending less than budgeted, as evidenced by the $34.4
million carry over in unspent funds and reserves; and said having these reserves enables the city to
function financially sound as we "pay as we go" rather than going into debt or reducing the number of
employees, adding that this City employs 84 full time and four part time employees, and for a city with a
population of over 88,000, and in comparing Spokane Valley to other Washington cities with populations
over 50,000, we have the least number of employees; and comparing communities with populations
between 30,000 and 49,999, the City of Spokane Valley has fewer employees then 12 of the 15
communities listed, with only Sammamish, University Place and Burien having fewer employees. Mr.
Mercier ended his presentation by stating that community input and involvement are critical components
of representative government.
Mayor Munson called for a recess at 8:05 p.rn. and reconvened the meeting at 8:20 p.m.
2a. Community Survey Results — Mike Jackson
Deputy City Manager Jackson explained that the City contracted with the International City County
Management Association and the National Citizen Survey to conduct a citizen survey; that a total of 400
telephone surveys were completed with a response rate of 25 %; said that households were selected at
random, and attempts were made to call selected homes at least three times during different times of the
day and said the survey's margin of error is +1— 5 %. Mr. Jackson said the survey was conducted January
19 to February 2, 2009. Variables to consider, Mr. Jackson noted, include the City's 2003 incorporation
date, and that while services such as drinking water, solid waste disposal, fire and sewer are offered in the
City but not offered by the City, those issues can have a reflection on the overall quality of life within our
community; and since the survey was done during one of the worst winters in history, that could have also
affected the response concerning snow plowing and street and sidewalk maintenance. Mr. Jackson said
the survey provides a survey of "quality of life" in whether those surveyed would recommend Spokane
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Valley as a place to live; and surveyed the services provided by local government, such as public safety
and street maintenance.
Mr. Jackson said the survey's executive summary shows that the "overall quality of life" was rated as
excellent, good or fair by 99 %, with 86% rating it as excellent or good; and concerning if Spokane Valley
is a good place to live, 98% responded good, excellent, or fair, with 89% rating it as good or excellent;
and almost all respondents (92 %) reported they plan to stay in the City of Spokane Valley for the next
five years. Mr. Jackson said the five characteristics receiving the most favorable ratings were
opportunities to participate in religious or spiritual activities, shopping, availability of affordable quality
food, volunteer opportunities, and educational opportunities; with employment opportunities, cultural
activity opportunities, traffic flow on major streets, and ease of bicycle travel and walking as the five
characteristics receiving the least favorable ratings. Mr. Jackson then went over a sampling of the survey
results, noting that "excellent, good and fair" were all considered "positive results," with "poor"
considered negative results.
Mr. Jackson explained the benchmark comparisons and ratings and said Spokane Valley chose two
benchmark comparisons: a national benchmark of approximately 500 jurisdictions; and a subset of similar
jurisdictions including those having populations between 64,000 and 149,999. With those two
benchmarks in mind, Mr. Jackson then explained the ratings received by our respondents, which showed
we are similar or above in most categories, such as a place to retire, safety after dark, etc., and below
other jurisdictions on services provided, some of which included value of services for taxes paid, overall
direction the City is taking, the job the government does at welcoming citizen involvement, the job
government does at listening to citizens, overall appearance of Spokane Valley, street cleaning and snow
removal, and police and fire services; and that the ratings of the city employees of those who had contact
with city employees, was below other jurisdictions in areas such as knowledge, courtesy and overall
impression. Mr. Jackson said the range of ratings on the benchmarks is extremely small, with 78 points
for "above," 75 points for "similar," and 72 points for "below;" thus only leaving a different of 6 points
between the "above" rating and the "below" rating. Mr. Jackson said surveys are the most reliable,
equitable and cost effective means of hearing from the community; that this survey cost $18,000; it sets a
baseline for community ratings and will serve as a reference document, is broad -based and follow up is
often needed to understand results, and that the key is action as we listen and learn from the ratings, and
develop goals and objectives to sustain strong ratings and strengthen weak ratings, and that one of the
tools we use to help in these endeavors is our business plan, which measures performance and goals and
sets out objectives, that we are working to improve the ease of walking and bike travel as we work on the
proposed bike and pedestrian plan, and strive for long -term overall improved services, and more civic
engagement to build a better quality of life for the community and gain stronger public trust.
3. Sprague /Appleway Revitalization Plan — Scott Kuhta
Senior Planner Kuhta explained that Council asked for some review and background/history of the
development of this Plan; and via his PowerPoint presentation and staff report of May 5, 2009, he
explained this corridor has transitioned from framing and large track homesteads, to a major
transportation corridor, and that the land uses oriented to the traveling public selling their goods and
services; that this corridor which contains the boundary which defines the sub -area, contains over 1100
parcels and was divided up to mainly serve the traveling public; and since the early 1900s, hasn't changed
much in terms of the land uses oriented to serve the automobile, which is part of the problem we
identified. Mr. Kuhta continued with the history explaining that Spokane Valley had initially adopted
Spokane County's Comprehensive Plan to guide growth and development; and that the County
Comprehensive Plan, which was adopted in 2001 under the Washington State Growth Management Act,
changed land use and zoning along the Sprague Corridor. Mr. Kuhta explained that the County planning
process resulted in two land use scenarios which were evaluated and considered for adoption, referred to
as the "focused growth" and the "conventional growth" scenarios, with the "focused" growth identifying
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major urban centers along the Sprague corridor with mixed use corridor between the centers; and the
"conventional" growth retaining the historic regional commercial designation along the entire length of
Sprague Avenue; and he showed both scenarios depicted on maps. Mr. Kuhta explained that what the
County ultimately adopted was, they kept the urban activity centers, they have mixed -use corridors, and
said they kept the regional commercial strip type zoning along Sprague; and he said the County's former
urban activity center, which is where we have identified to have our own city center, and under the
County's interim zoning, you could do a commercial zone change, a high density residential change, or
B2 zone change proposal all the way down to 9 and said Spokane Valley immediately started getting
some concern from citizens over some zone changes that were going on, we recognized that this was a
massive urban center; adding that these were planned along the light rail thinking there would be 5,000
people living here and supporting a major light rail station, but it was deemed way too expensive. Mr.
Kuhta showed the overlay showing how much larger the area was under Spokane County versus the City
of Spokane Valley's significantly smaller proposal; and said the City's current zoning trimmed back some
of the area and had it revert back to single family residential and some high density residential zoning that
was somewhat of a historical zoning in that area.
Mr. Kuhta said it is interesting to note if the City had not incorporated, and the land use map of the
County's been made into permanent zoning, the County adopted their urban design standards, which are
similar to what we are proposing for the mixed use areas with buildings oriented toward streets; and said
the transition on this corridor from strip retail to a more urban mixed use really started before we became
a City, and we are now carrying that concept forward. Mr. Kuhta said even the County recognized that
the success of urban center development required detailed professional, community based planning and
quality market research, and that the programs that involve design professionals, government service
providers, business people, all of which was in the County's draft 2000 plan. Mr. Kuhta said the City's
Comprehensive Plan laid the groundwork for the work we are now doing in the subarea plan.
Councilmember Taylor added that in dealing with the concept of a city center and what we are looking to
do along Sprague even before the SARP process started, this was supported by every member of Council,
without objection, to have this come forward in our comprehensive plan; and although there was debate
on various aspects of the Comprehensive Plan, there was no debate and no objection concerning the city
center, and he emphasized that this has been a Council - driven process.
Mr. Kuhta said there was an enormous amount of detailed study which went into the plan before we even
started the community participation; and he showed a map depicting the large area of properties
vulnerable to change, which means those properties consisting of a large vacant lot or a lot with a
dilapidated building; and said there was a lot of opportunity for this corridor to change into something
else; and it seemed to be begging for help for the City to get this area going; and he mentioned there were
other detailed studies concerning the economic analysis looking at rental rates, land rates, lease rates, and
how a lot of the retail land was valued similar in price to residential lands. He said that some of the main
points of the Plan is that it supports retail centers where the market is strong, identified the city center, it
encourages a mixed -use between centers, which is important if we are going to transition this corridor
from an "anything goes" retail along the length to the idea of mixed use, and said that is why some of
those regulations exist in the plan; he said the intent of the Plan is to increase the value for all property
within the corridor, and not just focus on one piece or the city center; and to balance the transportation
system that supports the envisioned land use is a key point in the economic analysis and a good planning
principal. Deputy Mayor Denenny added that he remembers when the discussions started, it started
around traffic patterns but it quickly became evident as information was gathered on how streets are
designed, that we could not determine traffic patterns until a determination was made on the use of the
land and how to maximize it for the best land use; and if the goal was to simply move traffic, then we
would have had a 60 mph road down a residential area, which will indeed move traffic, but that was not
the goal: the goal was to determine the land uses. Councilmember Gothmann said he recalls many people
from the business community told him that rental rates were lower then the equivalent parts in the County
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and it was a problem as the values of their land had decreased; and many people had moved out, resulting
in many more business people stating that something must be done; and again stressing that one of the
objections of the plan was to increase the value of the land of those business owners so it would be
valuable enough so people would come in and could have a thriving business, and if they were leasing
their land, it would be done at a rate to enable the owner to make a profit, which was a major
consideration of many business people.
It was moved by Councilmember Taylor, seconded and unanimously agreed to extend the meeting to 9:30
P.m.
Mr. Kuhta further explained that his report discusses city center planning, which started as we developed
the sub -area plan, there was some urgency to engage the Library District but unfortunately that did not
work out to get the new library in the city center; and said all the information is in the report for Council's
review; that currently we are working toward negotiating for the purchase of property for City Hall, that
we have not decided to build a city hall yet, and most likely we would go to a public vote if we get to that
point in the future. Mr. Kuhta mentioned this report will be placed on the City's website, and will include
the number of property owners as well as the number of parcels involved.
7. Laptop Computer Training — Greg Bingaman postponed to a later meeting
removed from the agenda.
5. Agenda Items for June 3 Council /County Joint Meeting — Mayor Munson
The following are the suggested agenda items and suggested desired outcomes for the June 3 Spokane
Valley Council /Spokane County joint meeting:
1. Wastewater challenges. Determine decision points on each of the six scenarios for rates and charges;
regarding draft interlocal: key questions regarding Section 2.5 Charges: what are policy implications; and
Section 3.2 Duration and Termination of this Agreement: what are policy implications.
2. Metro Road Standards: present the Commissioners with a copy of our current road standards and determine
if Commissioners concur that they use that for the metro road standards.
3. Solid Waste: agree on a method of how to come to a decision about what to do when the bonds are paid off
in 2011; determine a timetable and process and discuss different protocols to develop a plan.
4. Snow removal: More length to the current transition period; designate someone to begin negotiation
revisions to the current winter road contract if the County were to continue to assist for another year or so if
Spokane Valley can't get their own contract up in time for the next winter season.
6. Agenda Items for Spokane City /Council Joint Meeting — Mayor Munson
The following are the suggested agenda items and suggested desired outcomes for an upcoming Spokane
Valley Council /City of Spokane joint meeting:
1. Wastewater challenges: if a Plan B is needed if faced with a moratorium, regional discussions need to move
forward; the desire is to keep Plan A (with County) intact; but need a contingency plan.
2. Municipal Court challenges: alternative court services and associated services; we see three options:
continue with the County's Municipal Court; have some affiliation with Spokane Municipal Court; or create
our own municipal court; determine City of Spokane's level of interest in making such affiliation a viable
possibility.
3. Regional Transportation planning/solutions: where are we now and where do we want to go; including the
structure of the SRTC Board.
4. GMA policies and implementation: discuss what template we can have for information sharing and
determine a method to present the County with a constructive mutually beneficial package to allow the
negotiations to move forward; what are the obstacles to identifying joint planning, and as the County continues
to develop on the outskirts of both cities, discuss the need for a joint program amenable to the County.
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8. Advance Agenda — Mayor Munson n/a
9. Information Only: Towing Amendments; Grant Application for Flashing School Beacon; and the
Library Quarterly Report were for information purposes only and were not discussed or reported.
10. Council External Committee Reports — Councilmembers n/a
11. Council Check -in — Mayor Munson: n/a
12. City Manager Comments — Dave Mercier n/a
13. EXECUTIVE SESSION: Pending Litigation; Land Acquisition
It was moved by Councilmember Taylor, seconded and unanimously agreed to adjourn into executive
session to discuss pending litigation and land acquisition for approximately thirty minutes; and that no
decision will be made upon completion of the executive session. Council adjourned into executive session
at 9:32 p.m. Mayor Munson declared council out of executive session at 10:00 p.m., and it was then
moved by Deputy Mayor Denenny, seconded and unanimously agreed to adjourn. The meeting adjourned
at 10:05 p.m.
E ... - or - -
Christine Bainbridge, City Clerk
ichard Mu
ayor
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