Urban Politics #153: South Lake Union Development


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By City Councilmember Nick Licata.

Assisted by Legislative Assistant Lisa Herbold on this issue.

Urban Politics (UP) blends my insights and information on current public policy developments and personal experiences with the intent of helping citizens shape Seattle’s future.

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South Lake Union Development

The South Lake Union neighborhood is scheduled for hundreds of millions of dollars of public investment in the expectation that there will be a return on that investment in the form of additional jobs and additional revenue to the city.

In recent weeks Mayor Nickels has unveiled three major projects:

1) $45 million street car to primarily serve South Lake Union

2) $200 million dollars for a new electric substation and related electrical infrastructure to accommodate newly-proposed growth of 20,000 jobs

3) $100 million for the expansion of Mercer Street

And there may be even more investments not yet identified on the horizon.

As the City Council evaluates them to appropriate funds, I, together with Councilmember Conlin, have noted that a review of the South Lake Union Neighborhood Plan is called for as required by our City’s guiding Comp Plan.

A recent DCLU Comp Plan update shows that job growth in the South Lake Union area of Seattle has far outpaced projections. On its face that is good news. This growth has happened and will continue to happen, with the important investments of Paul Allen, the University of Washington, and Fred Hutchinson.

But when it comes to making new, unplanned public investments of at least $350 million dollars in a neighborhood that is already surpassing its job growth goals, one must consider whether public dollars might also be spent developing jobs elsewhere.

Neighborhoods like Pioneer Square, Denny Triangle, the International District, Capitol Hill, Ballard, Uptown and the West Seattle Junction are falling far below the job growth projections the city has set for them. Lake City and North Rainier Valley have even lost jobs during this same period. The City must be diligent in distributing our limited supply tax dollars to neighborhood business districts throughout the city so that we do not investment too much in just one or two neighborhoods.

Just recently I was in the Haller Lake Community at a meeting of 200 neighbors upset at the traffic impact that a new Costco store could have on their community. I was the only elected representative at the meeting. I told them that the city must work with them and Costco to mitigate its impact on their neighborhood. That new Costco store will probably bring more new jobs and more revenue to the city than any bio-tech company that has already committed to the South Lake Union to date.

If we are to invest tax dollars in South Lake Union to attract bio-tech businesses should not the City also be considering investing tax dollars for the homeowners in Haller Lake so that they will not oppose new job creating retail developments near their neighborhood? The answer is yes. And previous Mayors and Councils agreed as well when they adopted the City’s Comp Plan in 1994 which set growth targets in housing and jobs by neighborhood so as to distribute them throughout the city and to match them with public investments.

The Comp Plan is a 20-year blueprint for Seattle’s growth in response to the state Growth Management Act (GMA) of 1990. The GMA requires jurisdictions throughout Washington State to accept and plan for projected growth. The Comp Plan guides future decisions about where growth should be located and how the City will address the effects of growth on transportation, housing, and open space.

The recently released DCLU report “Monitoring Our Progress: Seattle’s Comprehensive Plan,” states that 5,947 new jobs have been developed in South Lake Union since 1995, while only 4,500 new jobs were planned though 2015. This is 132% of its 20-year growth target for seven years. Again, on its face this is good news because this growth has occurred without public dollars building a trolley, a new electric substation, or a Mercer Expansion.

The Comprehensive Plan includes an important policy specifically designed for variances like the ones we see in South Lake Union. The policy is called L52; the Council passed a subsequent Council resolution in 2000 that clarified this policy. L52 provides for a review to be initiated if “the rate of growth is different from that anticipated by growth targets…because it is occurring too rapidly and may be disruptive.  The procedure should include a review process with the affected community to determine whether or not City or community action to more effectively achieve growth goals is warranted.”

Council Resolution 30152 created upper- and lower-targets for triggering the L52 review. The resolution says such reviews can be initiated when urban villages/centers achieve 50 percent or more of their employment growth within a five-year period.

The outcome of such a review could result in one or more of the following recommendations 1) an increase in job growth goals to more accurately reflect actual activity in South Lake Union, 2) a community and Council commitment for more public infrastructure investment to mitigate greater than anticipated growth in South Lake Union, 3) a community and Council commitment to shift public investment to other communities that are not meeting their goals to encourage new job creation, and/or 4) an adjustment of growth goals for neighborhoods that are not meeting their growth goals.

The Mayor’s South Lake Union Action Agenda is “to build a biotechnology hub in the area, create thousands of new jobs, and fuel growth in the city’s economy.” In his March 10 press release he states: “There has never been a better time to seize the moment in South Lake Union. We’re putting the pieces in place to attract more biotechnology firms and high-paying jobs to our city.”

A June 11, 2002 Wall Street Journal article states “It can be a risky bet. Biotechnology isn’t a proven moneymaker; in aggregate, the industry posted $5.8 billion in net losses in 2000. It is dominated by small research-driven firms that can blow through tens of millions of dollars in a year and then disappear in an instant if a drug fails to work.”

A June 2002 Brookings Institute Study Signs of Life: The Growth of Biotechnology Centers in the U.S. further asks: “The ultimate impact of biotechnology on metropolitan economies is unclear. Biotechnology is a visible and rapidly growing industry, but it is not yet very large. Nationally, the best estimates suggest that fewer than 200,000 people work for biotechnology firms. Based on the average levels of pay for medical researchers and skilled technicians, these are good jobs. But will a successful biotechnology cluster generate enough jobs to be a major driver in a metropolitan economy?” Similarly, I question whether it is government’s job to subsidize such risky business ventures.

In closing, the Mayor’s plans for South Lake Union may involve significant departures from citizen Neighborhood Plan recommendations. As Council considers changes, it must do so with public involvement. Otherwise we should ask ourselves why did we even adopt growth goals and ask thousands of citizens throughout Seattle to spend countless evenings attending meetings, along with paid city employees. City government must keep its promise and follow its own rules and not toss them aside with each new administration or council taking office.

The DCLU report, Monitoring Our Progress: Seattle’s Comprehensive Plan can be found at http://www.seattle.gov/DCLU/Planning/comprehensive/reports.htm

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