West Seattle Junction free parking needs to end; Everyone responsible agrees but who will control it? What about development?
The free parking in the West Seattle Junction has to change to a paid format and development of the land the parking lots occupy is inevitable. Those are the primary things the West Seattle Junction Association (WSJA) and their landlord the West Seattle Trusteed Partners (WSTP) agree on.
But beyond that the divisions run deep.
In a shareholder meeting on April 11 various shareholders were given a chance to express themselves and they too agreed that change was coming. The disagreements center on who would run a paid parking program, how it would work, and later how would development of that land be managed. The WSJA operates under a Business Improvement Area (BIA) agreement with the City of Seattle.
Lora Radford, Executive Director of the WSJA (and who asked to attend the meeting but was not granted permission) said the WSJA has been seeking paid parking since last year. WSTP Secretary Tyler Johnson said during the shareholder meeting that the rights of the landlord had been "evicserated in the last lease by the previous board" and said that changes to the lease were required to permit development. Radford shared a lease document with Westside Seattle showing that the lease clauses had in fact been in the process of negotiation but that those negotiations were terminated by WSTP with no explanation according to Radford. The current lease is Triple Net. A triple net lease is a lease agreement on a property where the tenant or lessee agrees to pay all real estate taxes, building insurance, and maintenance in addition to any normal fees that are expected under the agreement.
WSJA is responsible for negotiations and setting up repairs and maintenance of the parking lots. Over the last three years they have paid $158,484 for the lots. In the last year WSTP has attempted to get WSJA to pay for legal costs as well but got push back in that regard.
The board has been working on a policy guide regarding maintenance. During the meeting the board said that repairs to the lot on 42nd SW would take place this Spring including seal coating, patching and re-striping.
The parking lots, comprising 228 parking spaces out of the roughly 700 free and paid available in the Junction have been free to shoppers since the arrangement with the Trusteed Partners was struck in 1954. Rising land values and the concurrent higher tax bill meant meeting a nearly $20,000 monthly payment was increasingly difficult. Even an appeal to the King County Assessor's office only brought temporary relief in the form of a ramped down bill. That tax bill will ramp up again in 2020, with estimates over $160,000 per year for just taxes alone. The lots were assessed under the idea of "highest and best use", meaning their land value skyrocketed.
But relations between tenant and landlord grew increasingly tense after a new board was elected two years ago. For some members of the WSJA the perception was that development of the land was the WSTP's main priority. But there are limitations on any plans of that kind due to a 20 year lease formulated under previous WSTP leadership.
The WSJA launched a series of fund raising efforts, including at one point putting up voluntary pay boxes in the lots. This prompted the WSTP to claim this was a violation of lease terms and a 30 day vacate order was taped to the WSJA office door. That dustup was resolved when the boxes were removed. In a meeting on March 11 the two sides discussed the issues. By all accounts that meeting was amicable.
The WSJA produced a letter that covered most of the points they raised saying:
- WSJA is not opposed to development
- WSJA wanted an opportunity to develop the lots that will support the community and be visionary
- WSJA suggested that building a dedicated parking structure would be a positive use of one parking lot
- They hoped that any development would create space that attracts single owner-operators with rents that are affordable
- They noted that the four merchant-supported parking lots represent only 32% (228/700) of all available parking in the Junction
- They explained that moving to a paid parking model would offset the tax burden but that it is inconclusive if a paid parking model would cover the full tax bill
- They noted that any paid parking plan could charge only what the market will bear
- WSJA said that parking costs represent 60% of overall incoming BIA assessments
- They explained that assessments represent only 48% of all revenue (grant income/sponsorships/community donations)
- They suggested that public relations working in lockstep with WSJA would be beneficial moving through community input and ultimately through design review.
In the annual Shareholder meeting held April 11, the motion was made and seconded to allow the WSJA to charge for parking. But that motion was essentially tabled and since any vote on a motion is non-binding, it was not acted upon. Joe Erickson maintained that it was not appropriate to take action on a plan since there was no proposal before the board.
The WSJA told Westside Seattle they in fact have a parking plan in place and Radford said she had sent it via email to all the board members twice, once on March 15th and again on April 8th. In addition, the WSJA attorney sent a letter to WSTP dated January 7th, 2019 requesting the ability for WSJA to charge for parking. WSTP never responded to any form of communication. Board President Joe Erickson, Vice President Charlie Conner and Treasurer Dave Gowey all claimed no such plan was sent even though other shareholders said they had seen it. Radford said she would send the plan again, this time by registered mail to secure legal proof of receipt.
Radford said that Diamond Parking (who administers the lots now) would be contacted if an agreement is struck and get the ball rolling. It could be in place in as little as 30 days after the papers are signed. That would include restriping, numbers and pay stations.
In line with other paid parking in the Junction normal rates would be $2.00 an hour, with free parking during the Farmers Market. The rate would be $3.00 an hour festival time. The fine for overtime parking would be the same as the other Diamond lots Radford said.
Radford said that the paid parking would annually raise "about $95,000 which will offset the $122,000 tax bill in 2019. In 2020 we expect to see the tax bill reach $160,000 as our 2 year suppressed tax period is over. The paid parking will not pay for all of the taxes, ground lease, maintenance and additional expenses." That amount will rise to more than $200,000 (though that number is not exact) after tax assessments are issued in 2021.
Radford said the WSJA's various fund raising efforts, thus far have raised a total of just under $8000. Those have included the donation boxes, special beers, a "Round Up for the Junction" promotion letting shoppers add money to bills to make a contribution and more.
Radford said, "We’ll continue to use the retail donation boxes at Husky Deli and the Stop n’ Shop. We’ll work with the building owners to install the donation boxes on the buildings, we trigger the Round up for the Junction’ promotion and we’ll move forward with a major fundraiser, we’ll hold a music concert ‘Lot Rock’ and we have received commitments from private donors to support the fundraising."
The WSJA is responsible for negotiations and setting up repairs and maintenance of the parking lots. Over the last three years they have paid $158,484 for the lots. The WSJA also pays for administrative costs and WSTP has attempted to get WSJA to pay for legal costs as well.
The board has been working on a policy guide regarding maintenance. During the meeting the board said that repairs to the lot on 42nd SW would take place this Spring including seal coating, patching and re-striping.
President Joe Erickson said that the WSTP Board had attempted over the past year to get a dialog going with WSJA “on how we can come together on some plans that will allow us to understand how we can develop the lots. The board’s opinion is that we’re going to need to develop these lots. That’s the only way we’re going to get any relief on what it costs to park in these parking lots. They are going to keep raising our taxes and right now those taxes get passed along to our tenant. Over time that’s going to be kind of hard to sustain. I think the vision is we want to develop the lots in a very careful, thoughtful, collaborative manner over time. If we want to have the kinds of amenities and types of services in the community that will dramatically reduce the property taxes that basically have to be picked up by the merchants and the Junction Association. Right now the highest and best use goes completely to the Junction Association as part of their lease. When we develop this a good portion of that highest and best use value will be associated, not with the parking but with the business's space upgrade.”
Leon Capelouto, who owns major portions of the Junction suggested it was time to allow the WSJA to charge for parking. “If the board would allow that I think it would help to allow the taxes to be paid and our tenant to survive. They even tried to put up donation boxes and the board didn’t allow that. I just don’t think it’s been very friendly toward the BIA nor has it helped them. My point is that I think we should allow them to charge for parking and that would help them pay the taxes. It’s that simple. It would be a good solution until we can get through 2020 and beyond until we can work out something else.”
WSTP VP Charlie Conner said the board had set several meetings with WSJA that were cancelled and that he had visited the WSJA website attempting to find a mission statement to better understand their purpose and goals and could not find one.
When they met on March 11 Conner said, “We went around the room and we were asked what our development plans were and we currently don’t have any plans.” He explained that in announcements to shareholders “We will be transparent in what we’re doing. I think that’s very important because there’s lots of speculation and frankly it will make sense to redevelop the lots because we feel that to continue to provide parking and cover the taxes under highest and best use… During that conversation we talked about in the interim what will we need to do? How will we make this work? I think we all came to the conclusion that very soon, those lots will have to be lots that are user paid. They are not free. All the merchants here are paying through their property taxes…Beyond that there was discussion about a parking study Diamond Parking had done that Lora said she would provide us and I don’t know if we’ve received that yet or not.” Several board members said they had in fact seen it.
“The other thing we haven’t seen is that there was a study that was commissioned.” He was referring to a survey that was conducted by a company hired by WSJA asking the public what they wanted to see in the Junction’s future. Again, several board members said they had seen it, and in fact the results of the survey were published online. Leon Capelouto pointed out that Joe Erickson had even commented on the survey results.
Conner noted that Husky Deli owner Jack Miller was developing his family property in the Junction and was asked how many parking spaces that building would offer. Miller said there would be 57 stalls for residents. “Is there any flexibility there,” Conner asked and Miller said there would be. This in light of changing transportation needs and ready availability of both transit and ride share options.
Jack Menashe, shareholder and owner of Menashe Jewelers in the Junction said he had conducted an informal survey of his own customers over the past year. "100% asked the same question. When are you going to start charging for parking? It's a privilege to have this business district here. We'd support paid lots."
Conner continued, “Before we can determine how the parking would work we need to see proposals and we have a duty on our side to figure out what is the best way of doing this and who should run that? Who is the most logical to run that? The Junction Association obviously has a lease now and that lease is going to become untenable because of the cost of the taxes… So there should be significant discussion about who should manage that parking. Should the owners manage that parking? The important thing for the community is that there is parking. Who manages it, who is most able and can do it most transparently because we have a feduciary duty to all the shareholders… In terms of ‘let’s give the parking to the Junction on a paid business’ I want to make sure that we adequately assess the economics and see what’s really the best way.”
He explained that he knows shareholders in other neighborhood business associations that manage parking lots and have done redevelopment, noting that his discussions with them were “quite some time ago,” but that he learned some of the economics of those activities. “Let’s make sure that we do it right and not just do “the first idea that is the easiest but may not provide value to the shareholders.”
Tyler Johnson said, "Since the execution of the lease that's currently in place we pretty much quickly recognized, that we have two immediate problems from the perspective of WSTP shareholders and protecting the interests of those shareholders. One, the lease does not allow, currently, a mechanism for planning, development during that twenty year period to be able to identify one lot at at time and work on a development plan for it. That's problematic from the standpoint that you've got a rising property tax environment and you also have a light rail that would likely be interested in these lots. So we have from the outset been attempting to work with the Junction Association to recognize the realities that in twenty years we need to be able to have some rights that we can meaningfully plan for some level of development in a way that works with the community for what's going to happen with these lots. Because under the lease we haven't had the ability to really do that and because the Junction Association hasn't been willing to amend that lease we've been sort of struggling with coming up with solutions.Recently we've engaged with sort of a working committee to communicate with the Junction Association and develop some sort of common vision of kind of how to get there.But you can't really get started unless you have some rights to get started." He expressed his hope the WSJA would work on that. He continued, "Just to say we're going let them do the pay lots without addressing other aspects of amending the lease seems unwise at a minimum."
Tying an agreement over who should run paid parking and how that might be done in the short term, to a renegotiation of the twenty year lease was not explained. The current lease actually does specify that one lot at a time could be developed as long as the same number of parking spaces was maintained and only for parking itself, which is consistent with the original agreement and covenant with the City of Seattle. In fact even the WSTP's own bylaws specify that the corporation exists under Article II/2. Purposes and Objects to "Own and maintain real estate in West Seattle for the purposes of providing such parking space or spaces and to acquire, develop, maintain or cause to be acquired, developed and maintained, parking lots or other parking space for the purposes above outlined."
Here's Article 20 of the lease between WSJA and WSTP:
DEVELOPMENT OF ADDITIONAL PARKING
Notwithstanding anything to the contrary in this Lease, Lessor may construct additional parking on, above or under any part of the Property (the “Additional Parking”). Lessor shall provide Lessee with at least twelve (12) months’ notice prior to commencing construction of the Additional Parking. Such construction activities may only interrupt Lessee’s use of and access to up to thirty percent (30%) of the parking stalls currently located on the Project at any given time. During the construction of the Additional Parking, this Lease shall continue in full force and effect, provided however that Base Rent and Additional Rent shall abate in proportion to the number of stalls that are unavailable to Lessee during such construction activities. Lessee hereby waives any claim for interference with Lessee’s business, for any loss of occupancy or quiet enjoyment of the Property and Project, or for any other loss occasioned thereby. Upon completion of the Additional Parking, any Additional Parking stalls that Lessee may agree in writing to utilize shall become a part of the Project, subject to the terms and conditions of this Lease, provided however that Lessor may increase the Base Rent proportionate to the increase in such Additional Parking stalls. If Lessee declines to utilize any portion of the Additional Parking, such declined portion of the Additional Parking shall not be part of the Project. For clarification, nothing in this Article 20 will allow Lessor to reduce permanently the number or nature (ease of use and access, etc.) of parking stalls available to Lessee under this Lease as required by the Parking Covenant, without Lessee’s prior consent. Further, regardless of any construction of Additional Parking, at all times during this Lease there will be parking available on both 44th Ave SW and 42nd Ave SW (i.e. the parking will not be consolidated on one street or the other).
Capelouto said, "Maybe we try it for a year or two and see how it goes."
Johnson said, "We worked with them (WSJA) and they promised to do something for us to try and amend the lease on the property taxes. We positively engaged with Lora and we want to continue to have that positive communication but the fact of the matter is we've gotten nothing positive back."
Capelouto said, "We need to try a softer sell."
Junction True Value's Bruce Davis said, "I'm a little concerned about paid parking but I don't know what else to do. I think it's a detriment...My general impression is that there's conflict going on and I think both sides are playing a hard edge... We need to work on reconciliation."
Jack Miller said,"Our main concern is to provide parking. These parking lots are a precious asset. I don't know if you can develop them and still maintain the businesses."
Jeff Vann said, "Trusteed Properties was founded to create parking and we need to continue that. He noted that previous development plans were suggested but that they were not acceptable. "I think the checks and balances of the lease were put in there to stop something bad from happening. If we do it correctly and go through them we're going to have them change that lease and I think for the last years I've sat on this board we've been worried about that damn lease all the time and not worried about parking. What comes first? The horse or the cart? ....When they find out what we want to do I think the lease will fall in line... Do we go in and tel them how to run their business. Here we are a year later and they still haven't got one dime and we slap them upside the head when they try to educate the people that it isn't going to be free anymore with the donation boxes...We're in the parking business... Let them charge for parking."
Joe Erickson said he thought that paid parking was a good thing since with free parking, "It gets abused and you don't necessarily get the best customers in your parking lots. So setting the price correctly can help you better qualify the customers that come to the Junction and make sure that there's always some parking spaces available. There's a lot of science around, 'how do you set that price?' so you've got 90% of the lots full so there's always a spot available for that next customer...My opinion is that we should have paid parking and as Charlie said before we need to decide how we're going to do that. That's not a shoot from the hip question. That is something that requires some analysis. I'lll support a motion that we should have paid parking but having a motion as to who should do that, I don't think we're prepared to make that decision."
Jerome Cohen said, "What is the objection to going forward with that? We have some agreement here. The development is separate from the paid parking issue."
"Separate but there are some things the corporation would like to achieve relative to a lease," Erickson said.
Cohen continued, "The Junction Association ought to know, in advance, because its their existence. What is that vision? There's probably some areas the two organizations can get together on, but they need to have some certainty as to what's going to happen in the future."
Tyler Johnson agreed but said, "The question is whether West Seattle Trusteed Properties is entitled to have some ability to plan for the future and the fact of the matter is that all the rights were kind of eviscerated in the last lease... Everybody around here is saying they care about the Junction and I think the Junction Association has said that somehow the WSTP doesn't care. I think there's been a perspective that some people have been treated like outsiders."
Johnson explained, "The way the lease was negotiated... our interests were being carved out. I was precluded from running for the board for a couple of years which wasn't right. I have an obligation and a feduciary duty... I want to see West Seattle thrive and change and grow with the times. That happens through active communication to understand what the community wants." He said the lease doesn't protect both parties respective interests, and said "parking is paramount."
Erickson said further, "We need to have some rights as to where development goes. We understand that they want to have some of that too. But right now we've gone out of our way for two years."
Conner said, "The lease grants each party certain rights but pretty much any action that's been taken has been unilateral on the part of the Junction Association. The toll boxes pop up and there's never been any formal request or plans before that. They just showed up one day. Rent was not being paid on time. We finally had our legal counsel provide notice that 'You're in violation of the lease' and that's what it took to get the rent paid. The fact that we had a meeting over a month ago and were promised some things which we haven't gotten, that's not good faith. We continue to reach out and we never get an appropriate response.I was hoping that when we met we'd get some follow through. That's part of having a good relationship. I don't think there's any disagreement that we need parking. There's nothing in the original charter that said we're going to have a third party charge for parking in the Junction. We are going to provide parking. It was convenient to have the Junction Association to have the lease for that for whatever reason, I was not part of that, to have a third party come in and administer that. Maybe it made sense then. I don't know that it makes sense now. Looking at it from the outside and looking at how the Junction Association is running or not running it because we've also had to send notices about defiencies in maintenance which are cleary enumerated in the lease, that they're responsible for maintaining the parking which has not been done. We're just chasing a rabbit all over the place and we're not getting the appropriate response... We've had no proposal for any system from the Junction....I know Leon you're not going to run your business on 'Oh I think these guys are gonna do it so I'm gonna hire them'. That isn't a prudent way to do business and we have responsibility for the corporation to do things in a businesslike manner."
He explained the board supports developing a parking plan and making a determination as to the future of that land. "I'm not saying I'm going to build anything here because I'm really not in that business. I want to be a long term owner here in the Junction. That's why i bought the properties at Calfornia and Alaska. Times got tough and I had to sell them... I have concern for the Junction. I'm not some guy from outer space. I live in Renton. My father built stuff here back in the 60's... I want the community to work. I want us to prosper and those are not mutually exclusive goals."
Capelouto concluded that "Allowing the BIA to charge for parking would solve some of these problems because they'd have the money and be able to have the money. And we would have oversight."
Erickson suggested that Capelouto offer "all his good ideas for the Executive Committee."
On the Monday following the meeting Secretary for WSTP, Tyler Johnson said via email, "There was a discussion at the Shareholders meeting questioning whether WSTP had yet received material from the Junction Association that had been offered by the WSJA. Following a meeting in March with the WSJA we anticipated receiving a Diamond report related to paid parking as well as information about a neighborhood survey commissioned by the WSJA that touched on a variety of Junction area concerns. After the Shareholder’s meeting this past Thursday, because of the questions raised during the Shareholder meeting about the follow up by the WSJA I searched my email and surprisingly did find that Lora had sent the attached Diamond parking information on March 15th . I apparently missed the attached report when she initially sent it but did locate it this past Friday while reviewing the prior emails from Lora. I apologize for not being aware of the attached Diamond report at the Shareholders meeting as I would have been able to correct the impression that we had not received it from Lora. Obviously more needs to be discussed on the topic and we are still looking forward to receiving and reviewing the survey and other issues with the WSJA."
For now, the process appears to be broken at best since the lease negotiations are no longer taking place, and there was the initial disagreement over whether or not the WSJA had even sent a parking plan. No new meetings are scheduled. But the bills will keep coming, the planning for light rail is continuing, retail shops continue to have to deal with erosion from digital competition, and other development is adding to higher density and putting all parking at a premium.
During the shareholder meeting the Board of Directors was elected and is as follows:
- Joe Erickson - President
- Charlie Conner - Vice President
- Tyler Johnson- Secretary
- Dave Gowey - Treasurer
- Jeff Vann - Board Member
- Mark Swanson - Board Member
- Leon Capelouto- Board Member
Editors Note: This story has been updated from the original to reflect a brief response by the WSTP and a correction as to the Secretary position on the Executive Board of the WSTP. The Secretary of the West Seattle Trusteed Partners is Tyler Johnson not Leon Capelouto. We regret the error.
Spelling corrected. Thanks for catching the error