FEDRAC MINS 03-25-2003
City of Federal Way
City Council
Finance/Economic Development/Regional Affairs Committee
Tuesday, March 25, 2003
4:30 p.m.
City Hall
Mt. Baker Conference Room
MINUTES
Committee Members in Attendance: Chair Michael Park, Member Mary Gates, Member Eric Faison.
City Council Members in Attendance: Mayor Jeanne Burbidge and Council Member Linda Kochmar
Staff Members in Attendance: Iwen Wang, Management Services Director; David Moseley, City Manager;
Derek Matheson, Assistant City Manager; Pat Richardson, City Attorney; Michael Olson, Deputy Director of
Management Services; Curt Ryser, GIS Supervisor; Jennifer Schroder, PARCS Director; Mehdi Sadri, Information
Systems Man ager ; Jason Suzaka, Man agemen t An alyst.
Others in Attendance: Erica Jahn, Federal Way Mirror.
1. CALL TO ORDER
Chair Michael Park called the meeting to order at 4:30 p.m.
2. PUBLIC COMMENT
None.
3. COMMITTEE BUSINESS
a) Approval of the February 25, 2003 meeting minutes
Motion to approve the February 25, 2003 meeting minutes. Motion seconded and carried.
b) Legislative and Regional Affairs Update
Presented by Der ek Math eson
Last week was the deadline for bills to pass out of their house of origin and go to the other house
(with the exception of bills related to the budget or transportation).
Th e n ew r even ue for ecast for th e state came out a lot wor se th an expected. Th e pr ojected
shortfall has been revised to $2.6 billion from $2.4 billion. There should be a lot of action in the
upcoming weeks on how to address the budget deficit, and staff will monitor the situation
carefully. All of the water and sewer assumption bills failed to get out of their house of origin, so
both the Lakehaven bill and the Sewer and Water District Association bill failed, which is good
news from the city perspective.
Transportation:
A-1
The House Democrats released their transportation package today, proposing a three-cent gas tax.
However, the package does not have a lot of good projects benefiting South King County; there
would be funding for the I-5 HOV lanes and SR 509 funding, but not much else. Our lobbyi st i s
working on trying to get more projects funded for our area.
Regional Issues:
There is a big battle amongst RTID (Regional Transportation Improvement District) board
members, so of whom who like the current statute as is and other who want additional money for
transit projects. Mr. Matheson reminded everyone that the Senate is predominantly Republican,
who gener ally support more roads; and the House is predominantly Democrats, who generally
support more transit projects. So there will be a big battle during negotiations. TIB
consolidation is still possible, but not really going anywhere right now.
Annexation: There are bills passed to correct the petition method, bills regarding unincorporated
islands, and for cities that are in the utility business – bills that would allow cities to annex into
their own utility service area.
There was also a bill that died that would have given greater authority to Lodging Tax Advisory
Committees. Basically it would remove the “advisory” label to LTAC and given it actual
authority over the spending of lodging tax revenues.
There was a question asking if there was a chance of the additional rider being taken off of the
bill concerning unincorporated island annexation. Background: The bill would have allowed
cities and counties to enter into an interlocal agreement and annex unincorporated islands.
However, a rider that had a referendum clause was added, meaning that anyone could file a
referendum petition and force an election on it. The chances of it being removed are unknown at
this time, but will certainly be monitored.
County Budget Advisory Task Force: Last week a white paper was presented expressing cities’
concerns about the urban subsidy problems that continue to exist; the need for cities and counties
to try to streamline annexation; and the need for the County to be more collaborative with cities
in addressing its budget problems, especially to avoid delegating services to cities (such as the
pool s).
Solid Waste: In order to help address its budget woes, the County is going to be charging rent to
the Solid Waste division for using the Cedar Hills landfill site ($7 million/year). The Cedar Hills
landfill closes in ten years; will the County get into the business of building an intermodal yard to
transport waste on trains to other landfills.
A question was asked con cer n in g wh en th e City’s con tr act with th e Coun ty en ds for usin g Cedar
Hills. Mr. Faison asked to get more information about it. Mr. Moseley suggested a presentation
would be appr opr iate in April or May.
Staff is also watching the Sales Tax Streamlining Project, which looks at taxation on e-
commer ce. Th er e ar e question s as to wh o collects th e r even ue an d h ow it would be distr ibuted;
however, Federal Way is more revenue neutral because it doesn’t manufacture a lot of the goods
that are sold online.
c) Parks Purchase – All Purpose Utility Tractor
Presented by Jen n ifer Sch r oder
Ms. Schroder reviewed the proposal with the committee. She noted that the price given includes
the offer for the trade-in on the old tractor, and all of the appropriate sales taxes. Ms. Wang
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added that the City projects the standard life of the tractor at 12 years before looking at a
replacemen t.
Motion to recommend and forward to full Council the purchase of the tractor for the amount
of $35,578.73 from Coastline Ford Tractor. Motion seconded and carried.
d) Washin gton State Master Licen se Expan sion Pr oject
Presented by Cur t Ryser
Mr. Ryser gave an overview of the project with the committee. The basic idea of the project is
that it is an effort by the State and local agencies to streamline the business licensing system,
with th e state bein g th e “h ub” of th e system. Th e Depar tmen t of Licen sin g would be r espon sible
for a lot of the data entry work, including issuing license renewals. Customer service at City Hall
would impr ove, as staff could issue UBI (state busin ess licen se) n umber s, speedin g up th e
process.
However, some of th e issues th at would n eed to be looked at ar e: str uctur e an d sh ar in g of
business license fees (cities have fee structures of various complexities, see page D3), sharing of
information between agencies, how to simplify the application itself, and integrating of our
system with th at of th e state. It is possible th at we could exper ien ce an in cr ease in tr affic at our
front coun ter – we may get customer s wh o ar e in n eed of a state licen se, but n ot on e fr om th e
City.
There was a question concerning how the cities were coded according to color on page D3. Mr.
Ryser replied that during the focus group sessions, agencies were asked how their fees are
calculated – some h ave flat fee str uctur es, some h ave str uctur es based on th e n umber of
employees, etc. Specialist fees, such as adult en ter tain men t licen ses, wer e n ot con sider ed in
categorizing each locality. Federal Way is yellow due to variations in new business
licen se/r en ewal, an d oth er fees such as busin esses th at ser ve liquor on site.
The committee also asked about the extent of sharing of information between the State and
localities. Mr. Ryser explained that if someone applied for a liquor license at the City of
Bellevue, they would at least be able to check with Bellevue on the status of the application, even
though the liquor license itself is processed at the state level.
Councilmember Gates stated that in her past experience in dealing with the Master License
System (MLS), it h as pr oven to be a ver y efficien t on e, with excellen t customer ser vice.
Ms. Wang noted that Federal Way uses its business licensing system primarily for regulatory
purposes, not revenue. The cities that are in green, they mainly don’t do a lot of reviewing of the
application. We usually check on the zoning for compliance, and waiting until the tenant
improvements are completed. We potentially could determine that the MLS is not a good fit for
us because of our regulatory review focus. Councilmember Gates suggested that we find out how
the green cities regulate their businesses if they do not do it through their business licensing
system. Chair Park felt that joining the system would be a big benefit for small local businesses
in Federal Way.
e) Febr uar y 2003 Monthly Financial Report
Presented by Mich ael Olson
Mr. Olson reviewed the Monthly Financial Report (MFR) with the committee. The biggest
highlight is the sale of SeaTac Mall to Steadfast Properties for approximately $37 million. This
created a big bump in the REET revenues, which are 215.9% above YT D budget. However, sales
tax revenues are a little sluggish, as revenues are 2.5% below YTD, and retail sales are 6.9%
below YTD. Ms. Wang stated that she is slightly concerned but noted that a larger contingency
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was set during the budget season and that we should be ok in 2003. Factors include the layoffs at
Boeing, the war in Iraq, and the lack of improvement in the economy so far. She recommends no
change of course at this time.
Corrections: On page E6, Court revenues are 1.4% above budget, not 0.4% below as stated in
the narrative. On page E4, S. 348th retail block revenues actually 4.4% below, not above as
stated in the narrative.
Also of note is that there is a two-month lag time between the transaction sale and the collection
of the sales tax revenue. So the February numbers measure activities from last December. The
1% increase utility tax rate approved by the Council last November did not take effect until
March 1st 2003, so it will not show up in this MFR. So in April, we should see a bump up in the
utility tax revenues for the month of March.
Motion to accept and forward to full Council the February 2003 Monthly Financial Report.
Motion seconded and carried.
f) Vouchers
Presented by Michael Olson
Mr. Olson presented the vouchers for approval.
Page F21 (Seattle Times): Billing for employment ad
Page F23 (US Bank): Fee for bond agent
Motion to accept the vouchers and forward to full Council. Motion seconded and carried.
4. OTHER
None.
5. FUTURE AGENDA ITEMS
6. NEXT SCHEDULED MEETING
April 22, 2003 at 2:00 p.m. in the Mt. Baker Conference Room.
7. ADJOURN
Chair Michael Park adjourned the meeting at 5:21p.m.
Recorded by Jason Suzaka