Council MIN 09-05-2013 SpecialFederal Way
MINUTES
FEDERAL WAY CITY COUNCIL
SPECIAL MEETING
Council Chambers - City Hall
September 5, 2013
6:00 p.m.
www.cityoffederalway.com
1. CALL MEETING TO ORDER
Mayor Priest called the meeting to order at 6:10 p.m.
City Officials present: Mayor Skip Priest, Deputy Mayor Jim Ferrell, Councilmember Kelly
Maloney, Councilmember Susan Honda, Councilmember Jeanne Burbidge, Councilmember
Bob Celski, Councilmember Diana Noble - Gulliford, and Councilmember Dini Duclos.
City Staff present: City Attorney Pat Richardson, and Deputy City Clerk Stephanie Courtney.
2. PRESENTATIONS
Presentation of Schematic Design, Updated Cost Estimate and Operational Pro Forma
Analysis for the Proposed Performing Arts and Conference Center by Lorax Partners.
Community and Economic Development Director Patrick Doherty gave an overview of the
project thus far. This included a timeline of the City Center Vision which was adopted in the
1995 Comprehensive Plan. He stated the City Center is the "front door" of the city and is likely
the first impression of visitors, potential new business owners, investors, developers, and
others.
Mr. Doherty further highlighted the results of the 2008 citizens survey; and subsequent
feasibility study done in 2009 from Webb Management. He stated in March of this year, the
Council authorized schematic design development, updated cost estimate and operational pro
forma analysis.
He reviewed the financing of the PACC including New Markets Tax Credits (NMTC), Capital
Campaign (including naming rights and Grants), and the potential economic impacts of the
facility. He stated the on -going impacts (direct and indirect) to the region — Expenditures:
$2,537,630/year; Sales: $4,733,750/year; Earnings: $1,304,740/year; and Jobs: 37.
Mr. Doherty stated the next steps would include additional public meetings and citizen input on
September 17th and September 19th; the Federal Way Coalition of the Performing Arts will
continue to seek grants, contributions, and naming rights funding; and upon City Council
authorization, the 4 month process of the Land Use Permit Application can be started with an
approximate cost of $65,000.
City Council Minutes — September S, 2013 Special Meeting Page I of 4
Mr. Doherty introduced PJ Santos of Lorax Partners and Wendy Thompson of LMN
Architects. Mr. Santos reviewed the project goals and location of the project. He reviewed the
design of the building and how the facility would be situated on the site including the proposed
additional hotel. He highlighted artist renderings of the facility with 3 -D drawings from various
vantage points. The facility has been designed for a variety of uses to accommodate small to
larger functions and is fully equipped with "back of house" including dressing rooms, office,
restroom facilities, and kitchen. Wendy Thompson highlighted the Auditorium components
design features and the acoustical values of the facility. She also presented 3 -D graphics of
the interior of the auditorium, patron room and outside areas. Mr. Santos reviewed the Pro
Forma summary including the operating revenue and operating expenses and timeline
options.
Mr. Doherty introduced Joanne Piquette, President of the Federal Way Coalition of the
Performing Arts, who gave a brief update to Council on their fundraising efforts. She was
happy to announce they have approximately $500,000 in donations for this project with
upcoming events scheduled. She encouraged everyone to attend the rally on November 23rd
at Saghalie Middle School where all proceeds will benefit the PACC project.
3. CITIZEN COMMENT
H. David Kaplan, spoke in support of a Performing Arts and Conference Center which could
be a catalyst to bring more tourism dollars into the city.
Byron Hiller, spoke with concerns over the business plan and lack of contingency funds for the
project. He asked the city to look carefully at the operating budget.
Norma Blanchard, reflected the 2008 city surrey and asked Council if citizens would have the
ability to vote on this project.
Paul Lew, noted he spoke with staff who was able to answer his questions and concerns with
this project initially, he would like to see the project move forward.
Julie Vance, stated she was initially hesitant of this project, however supports the Arts and she
would like to have a more affordable option than the expense of traveling to Seattle to see a
show.
Patricia Conant, spoke as a supporter of the arts would like to see a Performing Arts facility in
Federal Way, however she is concerned with the potential stress on the city and if it would be
financially sustainable.
Laura Johnson, spoke in support of the arts and the idea of a Performing Arts facility, however
she agrees it seems the budget has holes that she would like the city to look into.
Lynda Jenkins, long -time resident of Federal Way spoke in opposition to a Performing Arts
and Conference Center in Federal Way.
Margaret Nelson spoke in support of a Performing Arts and Conference Center for the reason
it will bring more tax revenue into the city and possibly encourage more businesses to come to
Federal Way.
Carrol Clemens long term city commissioner spoke in support of the PACC and the increased
revenue in taxes it could bring. He noted the Aquatic Center and Celebration Park are a huge
driver for hotels and restaurants in the area.
City Council Minutes — September S, 2013 Special Meeting Page 2 of 4
Tracy Hills, spoke in concern over parking at the proposed facility and if this development
would bring any local job opportunities.
John Wilde noted he is undecided on this project; he would like to see if there are additional
options to consider for example a development similar to Kent Station or a Higher Education
facility. He is also concerned with parking issues, and access and safety of nearby
businesses.
Jim Burbidge, spoke in support of the arts, and supporter of the Performing Arts and
Conference Center. He would like to see information regarding potential costs for groups and
performers who would use the venue; he would like the Council to make sure it is
economically viable to everyone.
Vernon Jenkins, opposed the project and is concerned with the availability of parking at this
proposed site and proposed adjacent hotel. He also noted the current hotels in the area have
vacancy and suggested they might not want more competition.
Betty Huff spoke in support of the PACC and noted this project can bring big benefits to the
city.
Tony Moore, Federal Way School Board President noted he loves the idea of the Performing
Arts and Conference Center he agrees with previous commenters that there are holes in the
information and operating budget. He would encourage the Council to seek younger input as
this is a project that will be a legacy to future generations.
Matthew Jarvis thanked the Council for their service to the community and stated as a
business owner, he is on the "hook" for his business 'Pro Forma. He is concerned in this
situation if the projections and Pro Forma are vastly off, the tax payers are on the hook for the
difference or any shortfalls.
Allen Nelson spoke in support of the Performing Arts and Conference Center he noted there
are cities and there are good cities. He would like to see Federal Way be the type of city that
attracts people and continues to grow.
With no further citizen comment Mayor Priest facilitated discussion between staff, presenters
and Councilmembers. Mr. Doherty also introduced Joe Mcllwain the Director of the Edmonds
Performing Arts Center who developed the Pro Forma. Council discussion ensued where
Councilmembers asked for various clarifying questions of Mr. Doherty and Mr. Mcllwain.
Councilmember.Duclos asked to include neighboring facilities such as Auburn in further
reviews and asked when staff would be hired to reflect the revenue projections for the first
year. She asked about the use of the Webb report in the budget.
Councilmember Noble - Gulliford asked if the employees would be city staff or non - profit and if
the payroll taxes and benefits are included in the budget.
Mr. Mcllwain stated preferably a non - profit group would be formed and that would run the
facility. All employees would be hired from that non - profit; not city employees. He noted there
is more freedom and opportunity with that option including fundraising and liquor service at the
facility.
Deputy Mayor Ferrell questioned if the Pro Forma budget is incorrect and the non - profit that is
running the facility fails, who would have to cover the additional funds to keep the facility
running. He also noted the salaries of the projected employees of the non - profit seemed low
City Council Minutes — September S, 2013 Special Meeting Page 3 of 4
for this region.
Councilmember Maloney discussed the Pro Forma numbers and also questioned areas such
as the salaries and benefits of the non - profit employees, and advertising budget which both
seemed on the low end of market. She additionally asked clarifying questions regarding
qualifying for the New Market Tax Credits.
Councilmember Celski thanked everyone for the feedback and thanked Mr. Mcllwain for his
work on the Pro Forma. He asked about cannibalization of local performing arts venues and if
Mr. Mcllwain in his professional opinion, how would he asses this project in regards to being a
desirable facility. Mr. Mcllwain stated the size and multi - purpose use of the PACC is very
desirable — his location currently utilized a partially renovated property for conference space.
Councilmember Honda noted her concern with fundraising donation totals included with the
budget and potentially over the local pool of donors. She is also concerned with the
use of Lodging Tax dollars and use of capital budget dollars. She is not supportive of using
the entire Lodging Tax budget on this project. She would like to see who is responsible for
equipment repairs.
Councilmember Burbidge thanked staff and the other presenters for their detailed
presentations; and thanked for all the community input given on this project. She requested
more detail in the areas of the ongoing programing including the balance of activities of the
local groups vs. the touring groups.
Mr. Doherty and Mcllwain addressed the Council's questions as information is available and
stated additional research will be done and brought back to Council.
In conclusion, Mayor Priest asked citizens to email or contact the city with any additional
questions regarding this project.
4. ADJOURNMENT
There being nothing further to come before the City Council, Mayor Priest adjourned the
Special Meeting at 9:15pm.
Attest:
S ep ,hhnie D. Court b4, CIVIC, Depu ity Clerk
Approved by Council: September 17, 2013
City Council Minutes — September S, 2013 Special Meeting Page 4 of 4