Urban Politics #157: Lifting The UW Lease Lid


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By City Councilmember Nick Licata.

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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CONTENTS:

  • A Brief History Of The UW Lease Lid
  • UW Lease Lid Lift Vote Tomorrow
  • The Drago-Nicastro Proposal
  • An Alternative Proposal

A Brief History Of The UW Lease Lid

The “lease lid” is a limit on the square footage of property the University of Washington may lease in specific neighborhoods surrounding the campus. It was imposed in 1985 to prevent UW leasing from distorting the real estate market and driving out other uses.

It has been raised over the years in response to UW needs. The first lease lid allowed for 241,950 square feet of off-campus leasing. In 1991 the lid was raised to 400,000 square feet and in 1998 it was raised to the current level of 550,000 square feet.

The following statement by Jeannie Hale, president of the Laurelhurst Community Club, provides a brief history of how the current proposal to lift the lease lid has come about.

“A few years ago, the University approached its neighbors asking about working together to revise the 1983 City-University Agreement because the City’s proposal did not meet the needs of the University. The communities did that. It took a long time-18 months-and there were many compromises-including compromises relating to the lease lid. At the time, there was never any desire on the part of the University to eliminate the lease lid. The City and the UW Board of Regents approved the 1998 City-University Agreement that the University and its neighbors had developed. This was a very successful example of the University working with its neighbors. It is what should happen with the current lease lid proposal.”

“The lease lid has worked well for the past 25 years. It has been modified on occasion to address changing needs of the University and new conditions. Changes have only been made, however, in consultation with the impacted communities. This has not happened with the Mayor’s proposal.”

UW Lease Lid Lift Vote Tomorrow

The City Council Finance Committee will take their first vote on whether to alter the current UW Lease Lid tomorrow morning at 9:30 AM in Council Chambers. The Committee Chair is Jan Drago, I serve as Vice-Chair and Peter Steinbrueck is also a member. It is likely, however, that other Councilmembers will join us and vote at the meeting.

The importance of this meeting is to determine if the formal Agreement between the City and the University of Washington should be amended to eliminate the existing restriction on the University’s ability to lease space in its neighboring communities. Currently they lease about 500,000 square feet within this “impact zone”. They lease approximately an additional equal amount outside this zone.

Last week Councilmembers Jan Drago and Judy Nicastro had crafted a proposal to lift the University of Washington lease lid in the core University District until July 2010.

The proposal incorporates recommendations from a University District Market Analysis commissioned by the Seattle Office of Economic Development and researched by the firm Gardner Johnson. Although the Gardner report has been criticized for its methodology it concluded that the key factor to revitalizing business in the University District is development of new housing and establishment of a permanent residential base that would serve as customers to local businesses at night as well as during the day.

This week the University of Washington’s Regional Affairs Director has written to the City Council to report that if the Council votes to approve the Drago/Nicastro proposal (Option 2) to eliminate the lease lid with conditions, the University will not support this position.

If the City Council were to vote for option 2 and University refused to sign the agreement the lease lid will simply stay in place as is. Similarly if the Mayor vetoed a Council vote supporting option 2 the lease lid would simply stay in place as is. If this were to occur then any negative consequence resulting from the failure to lift the lid would be the result of the University’s failure to negotiate and responsibility of the University, not the Council.

Out of concern that the UW, the Mayor, and the editorial boards of some of our papers may characterize the Drago-Nicastro proposal as anti-jobs and anti-growth the support of this proposal is waning and it appears that Councilmembers are supporting a more generous agreement (Option 4) to facilitate UW expansion.

The Drago-Nicastro Proposal

The Drago-Nicastro proposal, ( Option 2) which enjoyed the support of the Council majority last week offers significant concessions to the UW:

1. Negotiating this issue outside of the master plan process as required by the current agreement, eliminates 10 community organizations from the list of parties that the UW historically must negotiate this issue with.

2. This proposal eliminates the limit on the number of square feet that the UW may lease in the leasing zone. The University Park Community Club, Laurelhurst Community Club, Ravenna-Bryant Community Council, University District Community Council, Friends of Brooklyn, and the Community Council Federation, have all accepted the notion of giving the UW more leasing capacity. This is a strong statement from the community, showing their willingness to negotiate in good faith. Many of these groups wrote to Council supporting a lift of the limit to the level that equaled the projection, based upon past yearly leasing rates, that our own staff analysis supports as a likely 5-year capacity for the University.

The complete elimination of a regulation that community representatives throughout the City’s northeast region want to maintain in some capacity, offers nothing to address the concern that elimination of the lid will have a significant impact on the quality of life for a large segment of the City’s population. It cannot be denied that the wholesale elimination of this agreement, as opposed to simply increasing the square footage permitted, is a very significant gain for the University.

3. Lastly, this proposal expands the boundaries wherein unlimited leasing can occur.

A review of the public testimony illustrates that the only concession to the community is an agreement to lower the lid in five years if the City determines that the leasing patterns of the University are having a negative affect. A lowering of the lid at a later date, will allow the additional leased space to remain.

Despite all of these concessions, the University’s representatives have stated that they could not recommend it to the Board of Regents.

An Alternative Proposal

Since the University is rejecting the Drago-Nicastro proposal, I’m suggesting that the Council should entertain a straightforward increase in the lid. This is something that the communities are divided on. Some would not like to see any increase others are willing to see some increase.

I believe it provides a real compromise between the University’s and the community’s positions.

I propose the following elements of a new proposal:

1. Lift lease limit to 750,000 square feet. (Permitting 207,000 sf of additional leases) within permitted the leasing zone.

2. Provide the ability for the UW take advantage of two available exemptions to the 750,000 square foot lease limit.

Allow unlimited leasing within the permitted leasing zone and exempt from lease-lid restrictions new development projects that include a housing component of 30% floor area for the life of the building.

Also, allow unlimited leasing within the permitted leasing zone and exempt from lease-lid restrictions leases in the vacant upper floors of buildings existing as of the date of approval of this amendment.

3. New leasing shall not be permitted where it would result in the “demolition of structures with residential uses or change of use of those structures to non-residential uses unless comparable replacement is proposed to maintain the housing stock of the city.” (Language from Major Institutions Land Use Code 23.34.124).

The increase in the amount of square feet that the University can lease is what our Council Central staff determined would be sufficient to meet the University’s needs for the next five years. At any time during this period, the lid can be increased again if there is a demand for it. In addition, the past lid on the University’s ownership of land and buildings off campus has now been eliminated so they can own an unlimited amount of buildings to meet their needs.

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