Once again the city of Maple Valley and King County are going toe-to-toe over the Summit Place, also known as the donut hole, and the outcome is a tough one to handicap.
The county is in the process of trying to close a purchase and sale agreement with YarrowBay, a Kirkland-based developer, for the Summit Place site. The agreement calls for YarrowBay to pay about $51 million for the property, and the deadline for closing the deal is Sunday.
Sung Yang, director of government relations for the King County Executive Dow Constantine’s office, said the county is concerned that a “very important deadline is ahead” because YarrowBay decided not to pay $50,000 at the end of January that would have given them a six month extension on the closing deadline.
Summit Place is a 156 acre site located at 22801 S.E. 272nd Street and is owned by King County but surrounded by the city. The site is home to South King County’s Road Services maintenance facility and the east nine holes of the Elk Run Golf Course.
The city has been hammering out preannexation zoning for the property, which includes a master planned community land use zoning district.
King County sent a notice of objection Feb. 7 to the city concerning the preannexation zoning proposal. The county is objecting to when vesting for the project occurs under the zoning. The other objection involves the county’s belief the city must adopt a transfer of development rights or TDR program in the zoning measure.
YarrowBay’s plan is to construct a master planned development with about 1,600 residences with retail and commercial.
The preannexation zoning process is part of an interlocal agreement between the county and city. City Attorney Christy Todd and Community Development Director Ty Peterson walked the council members through a short history of time concerning Summit Place at the Monday City Council meeting.
The ball game started in 2007 when the city discovered the county was planning to sell the property and change the land use from rural to urban for development. The city wanted a seat at the planning table stating services for the development would have to be provided by Maple Valley. The city thought it should be allowed to annex the property, since it would be providing services, and it should be able to receive revenue from sales tax and excise tax from the development.
After more than a year of wrangling the city and county reached an accord. A memorandum of agreement was signed in 2008, which led to a joint planning document between the city, YarrowBay and the county and an interlocal agreement between the county and city.
The history report presented at the meeting will be posted online at www.maplevallereporter.com.
The heart of the current flare up between the county and city officials concerns vesting.
The city proposed zoning for a master planned community allows a property owner to submit a master planned community project application. There are two options for the MPC project application, one the city states in its code gives the applicant more protection from changing regulations and the other more flexibility.
The disagreement is the city zoning proposal does not provide vesting of the project once the MPC project application is approved.
Vesting rights are provided to a developer when an application for construction or for a plat is a considered complete by the city. A developer gains vesting under the preannexation zoning proposal through implementing development permits, but not after the MPC project approval.
The implementing development permits could be submitted at the same time as the MPC project application, but the permit will not be approved until after the MPC project application is approved.
Community Development Director Ty Peterson said the date the permit is submitted is the vesting date, not the approval date.
Vesting means the city codes and regulations pertaining to the permit are locked in place at the time of vesting and a project is not affected by future code changes.
From the developer’s standpoint, vesting locks the codes and regulations in place at the time of the complete application and gives certainty the future codes will not change the project, costing the developer more money or making the project unprofitable.
From the city’s viewpoint, the developer must provide enough detail in an application for the city to make a decision protecting the public good and if the vesting period is too long, then changes to codes could force the city to pay for upgrades to roads, storm water facilities or other parts of a project vested decades before regulations are in place.
Also vesting means changes in regulations adopted by a local government will not affect the vested project.
Kathy Brown, division director for the King County Facilities Management Division, sent the notice of objection letter to the city. Brown outlined the county’s position on the city’s proposed zoning.
The letter describes the MPC at Summit Place “illusory, ‘effectively precluding the realization of the goals and polices of the Joint Plan.”’
The letter also stated the proposed zoning is inconsistent with the joint plan “because it does not provide for or create a Transfer of Development Rights program in the City.”
Brown wrote, “jurisdictions of which we are aware vest an applicant to all or almost all land use regulations in effect at the time the applicant receives master planned community approval.”
The letter stated, “We are not aware of any jurisdiction in Washington that has taken such a distinct approach to master planning.”
According to Brown’s letter a developer would face problems financing the project because of the zoning and it “also has the implication of drastically devaluing the County’s asset since potential buyers would not view development of the property as viable under the City’s current proposal.”
City Manager David Johnston wrote a letter in response to Brown’s notice stating he, “sees nothing in the Joint Plan that obligates the City to adopt a TDR program.”
Johnston also wrote concerning vesting, “While I admire you and your colleagues’ efforts to make the case, I find no reference in the Joint Plan goals or policies that vesting is a requirement for master planning to succeed.”
The city manager also stated, “It is not local governments’ role to inquire into the financial health of a developer or to concern itself with a developer’s ability to obtain financing for a project.”
Johnston closed the letter stating, “the City will work with the County to find another buyer if the current prospect walks away.”
At the Monday City Council meeting council left the public hearing open to Feb. 28 and did not adopt the zoning. It is not clear whether annexation will move forward if the city adopts what the county considers zoning that is not compliant or consistent with the joint plan.
Brown said during a phone interview Tuesday the county staff was encouraged the hearing was left open and the zoning ordinance was not adopted.
“We will continue to discuss and see if we can come to an agreement,” Brown said. “I’m optimistic they didn’t make a final decision.”
YarrowBay is scheduled to complete the purchase and sale agreement and pay initial closing costs Sept. 20, unless they walk away from the deal.
