Full Text
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 {DPK1696861.DOCX;1/00020.050354/ } [PROPOSED] Findings and Conclusions - 1 OGDEN MURPHY WALLACE, PLLC 901 5th Ave, Suite 3500 Seattle, WA 98164 Tel: [PHONE REDACTED]/Fax: [PHONE REDACTED] BEFORE THE HEARING EXAMINER FOR THE CITY OF REDMOND In the Matter of the Appeal of RTC 74th Street Property LLC Of the November 17, 2017 Approval of BLDG-2016- 09558 related to the Redmond Town Center Apartments project in Redmond, WA. [PROPOSED] FINDINGS AND CONCLUSIONS I. Findings of Fact. 1. On November 15, 2017 the City of Redmond issued Robert Deane of Encore Architects, representative for RTC 74th Street Property, LLC – Appellant in this matter, an invoice for a range of fees required for the RTC Apartments development. 2. The November 15, 2017 invoice included line items of $826,492.14 for Parks Impact Fees as well as $1,229,445.23 for Transportation Impact Fees. 3. RTC 74th Street Property, LLC paid the Parks and Transportation Impact Fees and received City of Redmond Receipt TRC-08413-11-17-2017. This payment was made under protest. 4. On November 30, 2017 the City of Redmond received an Appeal Application Form from RTC 74th Street Property, LLC, G&I VII Redmond Town Center LLC, G&I VII Redmond ---PAGE BREAK--- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 {DPK1696861.DOCX;1/00020.050354/ } [PROPOSED] Findings and Conclusions - 2 OGDEN MURPHY WALLACE, PLLC 901 5th Ave, Suite 3500 Seattle, WA 98164 Tel: [PHONE REDACTED]/Fax: [PHONE REDACTED] Retail LLC, and G&I VII Redmond Development LLC, appealing the City of Redmond’s decision to impose impact fees as a condition of obtaining Building Permit BLD-2016- 09558 and claiming that they were entitled to exemptions from, and/or credits against, transportation and park impact fees. 5. The City of Redmond and Appellants provided pre-hearing briefs, response briefs, and attended a two-day appeal hearing on this matter. 6. The RTC Apartments development is located on a portion of Parcel 5 within the Redmond Town Center. 7. The RTC Apartments development consist of 256 residential apartment units, a parking structure and related building areas totaling 234,399 SF. 8. The RTC Apartments development is within the boundaries of the Redmond Town Center Master Plan which was approved by the City of Redmond through Ordinance 1841, effective July 17, 1995. 9. The approved Master Plan for the Redmond Town Center is dated July 18, 1995. 10. The approved Master Plan explicitly states that “[t]he Conceptual Master Plan consists of an open-air, mixed-use center of 550,000 to 650,000 sq. ft., and office park of 500,000 to 600,000 sq. ft., and related retail of up to 200,000 sq. ft., for a maximum gross leasable area of 1,375,000 sq. ft.” and does not include any residential component. 11. Figure 2.2 of the Master Plan identifies the RTC Apartment portion of Parcel 5 as “Surface Parking Screened with Landscaping.” Figure 2-6 shows the RTC Apartment portion of Parcel 5 as included within the “Town Center Mixed-Use” overlay. No residential overlay is identified anywhere in the Design Area Overlay figure. Figure 7-1 depicts the Phase I plan for the RTC Master Plan development and shows the RTC Apartments development ---PAGE BREAK--- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 {DPK1696861.DOCX;1/00020.050354/ } [PROPOSED] Findings and Conclusions - 3 OGDEN MURPHY WALLACE, PLLC 901 5th Ave, Suite 3500 Seattle, WA 98164 Tel: [PHONE REDACTED]/Fax: [PHONE REDACTED] portion of Parcel 5 as a parking lot. Figure 7-2 depicts Phases II and III for the RTC Master Plan development. No change to Parcel 5 is shown in either Phase II or III. 12. The Technical Committee’s memo to the Planning commission, dated April 10, 1995, which dealt with the consideration of the proposed Master Plan, specifically states that “although a housing element is not analyzed (in the EIS addendum) as part of this proposal, current zoning regulations allow multiple family development on the site.” 13. The Planning Commission drafted a similar memo to the Redmond City Council, dated June 15, 1995, which also does not include any reference to a residential component to the proposed master plan development. 14. The City drafted an EIS Addendum, dated April 11, 1995, in order to add analysis and information associated with purposed changes to the previously approved but not constructed Redmond Town Center Development. 15. The April 11, 1995 EIS Addendum specifically states that “housing is not an element of the current proposal.” 16. The April 11, 1995 EIS Addendum Table 1 similarly identifies zero residential units as part of the “present proposal.” 17. The April 11, 1995 EIS Addendum Table 1 further states that “Residential is a permitted use on the site. If is determined that this use should occur in the future, an additional environmental review may be necessary.” 18. The April 11, 1995 EIS Addendum Table 3 outlines the three phases of development for the Redmond Town Center and notes that “the site is proposed to be developed in three phases over a four-year period beginning in 1995.” ---PAGE BREAK--- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 {DPK1696861.DOCX;1/00020.050354/ } [PROPOSED] Findings and Conclusions - 4 OGDEN MURPHY WALLACE, PLLC 901 5th Ave, Suite 3500 Seattle, WA 98164 Tel: [PHONE REDACTED]/Fax: [PHONE REDACTED] 19. The April 11, 1995 EIS Addendum Figure 3A shows the RTC Apartment site as “RETAIL/OFFICE 2-STORY.” 20. Attached to the EIS Addendum as Appendix C is the Traffic Impact Analysis Report, dated April, 1995, which provided the basis for the City’s assessment of traffic impacts and provided the basis for the Transportation Mitigation Agreement. 21. The “Trip Generation” section of EIS Addendum Appendix C outlines the proposed land uses, square footage, and ITE Land Use Codes used in the traffic analysis – none of which includes residential. 22. Table 3 of EIS Addendum Appendix C provides a “Trip Generation Summary by Land Use” and does not analyze any residential component to the Redmond Town Center Project. 23. The “Passby and Internal Trips” section of EIS Addendum Appendix C analyzes the passby trip and internal trips assigned to the proposed development and does not use any residential use or square footage. 24. The figures contained in EIS Addendum Appendix A – Master Plan Guidelines and Standards, dated January 10, 1995, represented outdated information and are superseded by the conceptual master plan contained in the approved Master Plan for the Redmond Town Center dated July 18, 1995. 25. The Year 2010 Pro-Rata Mitigation Table for the Redmond Town Center development represents those transportation TFP projects impacted by the Master Plan build out through 2010 along with the pro rata share cost attributable to the RTC Master Plan. 26. The City’s current Transportation Master Plan, adopted May 2013 and updated August 2017, includes the Transportation Facilities Plan for the City of Redmond. This plan ---PAGE BREAK--- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 {DPK1696861.DOCX;1/00020.050354/ } [PROPOSED] Findings and Conclusions - 5 OGDEN MURPHY WALLACE, PLLC 901 5th Ave, Suite 3500 Seattle, WA 98164 Tel: [PHONE REDACTED]/Fax: [PHONE REDACTED] includes all transportation projects for the Downtown area that use transportation impact fees. 27. None of those projects included on the Year 2010 Pro-Rate Mitigation Table for the Redmond Town Center development are listed on the Transportation Facilities Plan for the City of Redmond included in the City’s current Transportation Master Plan, adopted May 2013 and updated August 2017. 28. The City of Redmond and Winmar Redmond, Inc. negotiated and agreed to a Transportation Mitigation Agreement, dated March 8, 1996, regarding the mitigation of transportation impacts from the construction of mixed use development at RTC. 29. The Transportation Mitigation Agreement states that, “It is the intent of the City and TCA that this Agreement shall fully satisfy the requirement that a traffic impact mitigation agreement be entered into. It is also intended that fulfillment by TCA of the requirements of this Agreement shall constitute complete satisfaction of all City requirements upon Redmond Town Center, including all future phases of Redmond Town Center through the year 2010 consistent with the Redmond Town Center Master Plan and the approval for File 95-014, insofar as such requirements are related to mitigation of impacts upon transportation facilities.” 30. Mr. Don Cairns provided credible testimony at the appeal hearing that the City negotiated the inclusion of the 2010 horizon because the City was creating transportation impact fees at the same time and it wanted to be able to use those impact fees at some point in the future. The City did not want to negotiate away its right to impose impact fees in perpetuity so it agreed that TCA could rely on satisfaction of the mitigation agreement terms through 2010. ---PAGE BREAK--- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 {DPK1696861.DOCX;1/00020.050354/ } [PROPOSED] Findings and Conclusions - 6 OGDEN MURPHY WALLACE, PLLC 901 5th Ave, Suite 3500 Seattle, WA 98164 Tel: [PHONE REDACTED]/Fax: [PHONE REDACTED] 31. Mr. Cairns provided further credible testimony at the appeal hearing that the developer negotiated this term in order to give a sufficient window for completion of all three phases of the Redmond Town Center without having to pay additional impact fees. 32. In 2001 the City received a request from the Macerich Company, owners of Redmond Town Center, to amend the Comprehensive Plan policies and associated development regulations for the Mixed use/Shopping Center district. This applicant requested and the City Council approved an amendment that would remove the existing limit on gross commercial leasable area and designate the Town Center as a receiving area for TDR’s. The request did not relate to development of residential units. 33. The April 11, 1995 EIS Addendum includes environmental analysis for Recreation and Open Space mitigation and requires “approximately 46 acres will be held in a conservation easement or conveyance acceptable to the City for public access and passive recreational use” as a mitigation measure. 34. The SEPA mitigation in 1995 was designed to retain acreage as mitigation to reduce environmental impacts to aesthetics and natural resource protection and the loss of open space. 35. The mitigation imposed upon the Redmond Town Center did not address new or increased demand to parks and recreational facilities resulting from residential development. 36. In 1995 the City’s Draft Comprehensive Plan does not contain a quantitative goal or policy for open space within the City Center. There is, therefore, no objective standard against which to measure the proposed reduction. However, the City did have an open space standard based on residential, which corresponds to residential development. ---PAGE BREAK--- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 {DPK1696861.DOCX;1/00020.050354/ } [PROPOSED] Findings and Conclusions - 7 OGDEN MURPHY WALLACE, PLLC 901 5th Ave, Suite 3500 Seattle, WA 98164 Tel: [PHONE REDACTED]/Fax: [PHONE REDACTED] 37. In assessing open space impacts for the Redmond Town Center, the City did not use the open space standard for residential, because there was not residential component to the project. 38. Park impact fees, as they are currently assessed, go to fund those projects listed in the PARCC Plan which contains the current Capital Improvement Projects list for the City. 39. None of the projects funded by the current parks impact fees, which are included on the PARCC Plan are the same as the mitigation required in 1995 for the Redmond Town Center. II. Conclusions of Law. 1. The Redmond Hearing Examiner has the jurisdiction to act as the appellate body which conducts an open record appeal hearing when decisions of the department director (Type I) are appealed. RZC 21.76.060(I)(1); RZC 21.76.050.C (Table 2. The decision of the department director is given substantial weight. Redmond Zoning Code (RZC) 21.76.060(I)(4) 3. The appellant must carry its burden and prove that the decision is not supported by a preponderance of the evidence or was clearly erroneous before the Hearing Examiner can grant or grant with modifications the request. RZC 21.76.060(I)(4) 4. Concurrent with the outlined burden on Appellants, RCW 82.02.070(5) provides that adjustments to impact fees should take into account principles of fairness. 5. Pursuant to the requirements of RMC 3.10.140(A), Appellants properly filed their appeal of both transportation and parks impact fees imposed by the City of Redmond on their project, the RTC Apartments development, which were imposed as a condition of obtaining Building Permit BLD-2016-09558 (Type I decision). See Table 21.76.050B. ---PAGE BREAK--- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 {DPK1696861.DOCX;1/00020.050354/ } [PROPOSED] Findings and Conclusions - 8 OGDEN MURPHY WALLACE, PLLC 901 5th Ave, Suite 3500 Seattle, WA 98164 Tel: [PHONE REDACTED]/Fax: [PHONE REDACTED] 6. Appellants in this matter timely filed their appeal within the time limits prescribed by RZC 21.76.060(I)(2)(c). 7. The purpose of impact fees is to implement the Capital Facilities Element of the Redmond Comprehensive Plan and the Growth Management Act by ensuring adequate park and transportation facilities are available to serve new development. RMC 3.10.010. Any person who applies for a permit to undertake any development activity as defined in the Redmond Zoning Code shall pay park and transportation impact fees. RMC 3.10.050. The City’s impact fee provisions conform to the State requirements outlined in RCW 82.02.050. 8. Impact fees may be paid under protest to obtain a building permit or other approval or permit. RMC 3.10.140(B). RTC 74th Street Property, LLC paid all invoiced impact fees under protest. 9. The legislature sought “ensure that impact fees are imposed through established procedures and criteria so that specific developments do not pay arbitrary fees or duplicative fees for the same impact.” RCW 82.02.050(1)(c). 10. RCW 82.02.050(4) and provide the framework for impact fees. Impact fees shall only be imposed for system improvements that are reasonably related to the new development, shall not exceed a proportionate share of the costs of system improvements that are reasonably related to the new development, and shall be used for system improvements that will reasonably benefit the new development. 11. Where a fee has previously been paid for the development activity under the State Environmental Policy Act (SEPA) for all of the system improvements for which impact fees are imposed by this chapter, the development activity shall be exempt from the payment of all impact fees pursuant to RCW 82.02.100. Where a fee previously paid for ---PAGE BREAK--- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 {DPK1696861.DOCX;1/00020.050354/ } [PROPOSED] Findings and Conclusions - 9 OGDEN MURPHY WALLACE, PLLC 901 5th Ave, Suite 3500 Seattle, WA 98164 Tel: [PHONE REDACTED]/Fax: [PHONE REDACTED] the development activity under SEPA does not cover all system improvements for which an impact fee is imposed under this chapter, an impact fee credit shall be given to ensure that the City is not collecting both SEPA and impact fees for the same system improvements. RMC 3.10.060(A)(6). 12. RCW 82.02.100(1) matches this requirement: “A person required to pay a fee pursuant to RCW 43.21C.060 [SEPA mitigation of environmental impacts] for system improvements shall not be required to pay an impact fee under RCW 82.02.050 through 82.02.090 [impact fees] for those system improvements.” 13. The City of Redmond’s approval of the Redmond Town Center Master Plan did not include environmental analysis or approval of any specific residential development component. Therefore, the RTC Apartments development is a new project and is not the same project upon which pro rata traffic mitigation and open space mitigation were imposed in connection with the 1995 Town Center Master Plan. 14. The Redmond Town Center Master Plan analysis and approval did not account for every potential permitted land use and only analyzed and approved those land uses described in the proposed project. 15. In 2001 the City of Redmond considered and then approved an applicant requested amendment which removed the existing limit on gross commercial leasable area and designated the Town Center as a receiving area for TDR’s. Because the request before the City at that time did not include any residential development, the City’s decision did not make any decisions related to residential. ---PAGE BREAK--- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 {DPK1696861.DOCX;1/00020.050354/ } [PROPOSED] Findings and Conclusions - 10 OGDEN MURPHY WALLACE, PLLC 901 5th Ave, Suite 3500 Seattle, WA 98164 Tel: [PHONE REDACTED]/Fax: [PHONE REDACTED] 16. “System Improvements” are defined as public facilities that are included in the capital facilities plan and are designed to provide service to service areas within the community at large, in contrast to project improvements. RCW 82.02.090(9). 17. The definition of “system improvements” is clear and unambiguous and means public facilities included on the capital facilities plan. 18. The term “system improvements” does not mean general categories of improvements. 19. The transportation pro rata fees previously paid by the Redmond Town Center developer, including the construction of improvements and credits towards those fees, do not address the same system improvements as those that will benefit from the current impact fees imposed upon the RTC Apartments Development. Therefore, RTC Apartments is not entitled to an exemption from the requirement to pay transportation impact fees. 20. The SEPA mitigation for open space required of the Redmond Town Center Developer, including the requirement to set aside open space and construct trails, do not address the same system improvements as those that will benefit from the current parks impact fees imposed upon the RTC Apartments Development. Therefore, RTC Apartments is not entitled to an exemption for the requirement to pay parks impact fees. 21. The Redmond Town Center Apartments are not entitled to any credits beyond those already granted to the Redmond Town Center for improvements made at the time mitigation was originally required. 22. The plain language of the Transportation Mitigation Agreement states the intention of the parties: It is the intent of the City and TCA that this Agreement shall fully satisfy the requirement that a traffic impact mitigation agreement be entered into. It is also intended that fulfillment by TCA of the requirements of this Agreement shall constitute complete satisfaction of all ---PAGE BREAK--- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 {DPK1696861.DOCX;1/00020.050354/ } [PROPOSED] Findings and Conclusions - 11 OGDEN MURPHY WALLACE, PLLC 901 5th Ave, Suite 3500 Seattle, WA 98164 Tel: [PHONE REDACTED]/Fax: [PHONE REDACTED] City requirements upon Redmond Town Center, including all future phases of Redmond Town Center through the year 2010 consistent with the Redmond Town Center Master Plan and the approval for File 95-014, insofar as such requirements are related to mitigation of impacts upon transportation facilities. This clear language, coupled with the credible testimony of Mr. Cairns, establishes that the parties intentionally included the 2010 horizon. Because the language contained in this clause clearly shows the intention of the parties, which is consistent with the credible testimony of Mr. Cairns, the Hearing Examiner will not read the 2010 horizon out of the agreement. Fulfillment by TCA of the requirements of this Agreement shall constitute complete satisfaction of all City requirements upon Redmond Town Center, including all future phases of Redmond Town Center through the year 2010. 23. The impacts associated with transportation at the time of the Redmond Town Center Master Plan revolved entirely around vehicle trips. Transportation impacts under the City’s current analysis and impact fee structure revolve around person-miles-traveled in a multi- modal system. Because the systems are structurally different (pro-rata share compared to impact fees) and service different needs (vehicle trips compared to person-miles-traveled in a multi-modal system), there is no straight trip credit that could be effectuated. 24. The impacts associated with parks and open space for the Redmond Town Center Master Plan sought to defray environmental impacts to aesthetics and natural resource protection. The Redmond Town Center Development caused a large reduction in open space (the golf course) that the City sought to address. The open space mitigation requirements placed on the Redmond Town Center Master Plan were not designed to address the increase demands that would be placed on the City’s parks and recreations facilities by residential development. Further, had the City intended to use the open space mitigation as a tool to ---PAGE BREAK--- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 {DPK1696861.DOCX;1/00020.050354/ } [PROPOSED] Findings and Conclusions - 12 OGDEN MURPHY WALLACE, PLLC 901 5th Ave, Suite 3500 Seattle, WA 98164 Tel: [PHONE REDACTED]/Fax: [PHONE REDACTED] address new residential development, there was a quantitative calculation that could have been used, but was not. 25. It would be unfair and unjust for the RTC Apartments development to rely upon the RTC Master Plan from 22 years earlier to avoid paying transportation and parks impact fees. The evidence shows that the City never considered residential development as a component of the RTC Master Plan and none of the mitigation or pro-rata fees were intended to address any impacts from residential development. Every other development going into the City of Redmond must comply with all applicable impact fees and the RTC Apartments should as well. 26. Because the RTC Apartments development was not an element of the Redmond Town Center Master Plan when it was analyzed and approved by the City, and because none of the transportation or parks mitigation required of the Redmond Town Center developer pertained to residential development, it is fair and just for the City to require payment of transportation and parks impact fees by the RTC Apartments development. DECISION For all of the reasons set forth above, the Appellants’ challenge to the decision of the City of Redmond to impose transportation and parks impact fees on the RTC Apartments development is DENIED. The City imposed transportation and parks impact fees remain in place. Ordered: ---PAGE BREAK--- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 {DPK1696861.DOCX;1/00020.050354/ } [PROPOSED] Findings and Conclusions - 13 OGDEN MURPHY WALLACE, PLLC 901 5th Ave, Suite 3500 Seattle, WA 98164 Tel: [PHONE REDACTED]/Fax: [PHONE REDACTED] Sharon A. Rice Redmond Hearing Examiner