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CITY OF SEATTLE

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ORDINANCE __________________

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COUNCIL BILL __________________

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..title
AN ORDINANCE relating to the Central Waterfront Improvement Program and the LID
Improvements identified herein; establishing Local Improvement District No. 6751
(“Waterfront LID”) and ordering the carrying out of the proposed LID Improvements, as
a component of the Seattle Central Waterfront Improvement Program in accordance with
Resolution 31812; providing that payment for the LID Improvements be made in part by
special assessments upon the property in the Waterfront LID, payable by the mode of
“payment by bonds”; creating a local improvement fund; authorizing the issuance of local
improvement bonds; and providing for interfund loans and for the issuance and sale of
short-term financing instruments, and ratifying and confirming certain prior acts, all by a
two-thirds vote of the City Council at a regular meeting.
..body
WHEREAS, in January 2011, the City Council (“Council”) of The City of Seattle (the “City”)

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adopted Resolution 31264, creating the Central Waterfront Committee (CWC) to oversee

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development of the waterfront conceptual design and framework plan (“Concept Design

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and Framework Plan”), to ensure robust and innovative public engagement, to identify

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public and private funding sources, and to establish the foundation for a lasting civic

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partnership for the implementation of improvements to the central waterfront area of

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Seattle upon the removal of the Alaskan Way Viaduct; and

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WHEREAS, by Ordinance 123761, originally passed in November 2011 and as amended by

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Ordinance 125188, the Council authorized creation of the Central Waterfront

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Improvement Fund and authorized an interfund loan to that fund to allow the Seattle

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Department of Transportation (SDOT) to incur pre-construction costs of planning and

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design for improvements that could be financed in part by a future local improvement

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district to be formed and known as the “Waterfront LID”; and

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WHEREAS, by Resolution 31399, adopted in August 2012, the Council expressed the City’s

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support for the Concept Design and Framework Plan, which was developed based on

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broad and inclusive public engagement over two years by the City and the CWC, and

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endorsed a Central Waterfront Strategic Plan (“Strategic Plan”), which established a

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funding plan and called for leveraging a mix of public, private, and philanthropic sources,

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including formation of the Waterfront LID, to achieve the vision described in the Concept

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Design and Framework Plan; and

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WHEREAS, the Council subsequently established the “Central Waterfront Improvement

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Program” to incorporate elements of the Concept Design and Framework Plan into the

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City’s annual Capital Improvement Plans, pursuant to which the City is planning to invest

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approximately $248 million from a range of local funding sources; and

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WHEREAS, in addition to the local funding sources, the State of Washington has committed

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approximately $194 million toward the completion of various components of the Central

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Waterfront Improvement Program; and

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WHEREAS, a portion of the Central Waterfront Improvement Program includes those

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improvements identified in Section 1 of this ordinance (the “LID Improvements”), which

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are intended to be financed through the formation of the Waterfront LID; and

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WHEREAS, by Resolution 31768, adopted in September 2017, the Council reaffirmed the

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funding plan (including local improvement district formation) for the Central Waterfront

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Improvement Program and outlined a process for formation of the Waterfront LID; and

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WHEREAS, by Resolution 31812 (“Intent-to-Form Resolution”) adopted in May 2018, the

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Council declared its intent to order the construction of the LID Improvements and to

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create the Waterfront LID to assess a part of the cost and expense of carrying out those

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LID Improvements against the property specially benefited thereby; and

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WHEREAS, it is the intention of this Council that, after confirmation of a final assessment roll

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and the expiration of the 30-day period for prepayment of such assessments without

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interest or penalty, the City will finance the unpaid portion of the assessment roll by the

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issuance of local improvement district bonds (“LID Bonds”) which will provide for a

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deposit of bond proceeds into the City’s Local Improvement Guaranty Fund in an amount

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to be set pursuant to the ordinance authorizing issuance of the LID Bonds (but not to

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exceed a maximum of 10 percent of the amount of the LID Bonds issued) and that those

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proceeds, when released from that fund in accordance with state law, will be earmarked

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to pay for major maintenance of the LID Improvements or other identified needs related

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to the Improvements. This Council further intends that persons who pay their assessments

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in full during the 30-day prepayment period will not be responsible for these financing

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costs (i.e., the costs of issuing the LID Bonds and making a Guaranty Fund deposit); and

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WHEREAS, all of the preliminary proceedings for the establishment of the Waterfront LID have

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been taken as provided by law, all as further described in Section 2 of this ordinance;

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and

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WHEREAS, the Council has determined it to be in the best interests of the City that the LID

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Improvements as hereinafter described be carried out and that the Waterfront LID be

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created in connection herewith; NOW, THEREFORE,

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BE IT ORDAINED BY THE CITY OF SEATTLE AS FOLLOWS:
Section 1.

LID Improvements. The LID Improvements consist of those

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improvements within the Central Waterfront Improvement Program that are identified with

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particularity on Exhibit A to this ordinance, which is incorporated herein by reference.

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Section 2.

LID Formation Steps Taken. The City has taken the required preliminary

steps to the formation of an LID, including:
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Formation Hearings. By adopting the Intent-to-Form Resolution in May 2018, the

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City Council declared its intention to order the LID Improvements and fixed the times and places

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for hearing all matters relating to the proposed LID Improvements and all comments thereon and

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objections thereto (the “Formation Hearings”).

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(b)

LID Improvements Estimated Cost Certified. The Director of the Office of the

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Waterfront and Civic Projects (OWCP), on behalf of the Director of Transportation, Seattle

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Department of Transportation, caused an estimate to be made of the cost and expense of the

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proposed LID Improvements and certified that estimate to the City Council on June 1, 2018,

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together with all papers and information in the Director’s possession touching the proposed LID

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Improvements; a description of the boundaries of the proposed LID; and a statement of what

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portion of the cost and expense of the LID Improvements should be borne by the property within

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the proposed Waterfront LID. The Director’s estimate is accompanied by a diagram of the

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proposed Waterfront LID area showing the lots, tracts, parcels of land, and other property which

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will be specially benefited by the proposed LID Improvements and the estimated cost and

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expense thereof to be borne by each lot, tract and parcel of land or other property.

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(c)

Notice Provided and Public Hearings Conducted. The City caused due notice of

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the Formation Hearings to be given in the manner provided by law and as described in the

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recitals to this ordinance. The Formation Hearings were held on the dates and at the times

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described in the Intent-to-Form Resolution, and all objections to the proposed LID

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Improvements were duly considered by the Seattle Hearing Examiner or the Hearing Examiner’s

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designee, and all persons appearing at such hearing and wishing to be heard were heard.

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(d)

Hearing Examiner Report Received by Council. The Seattle Hearing Examiner

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has submitted a report to the City Council, which contains the Hearing Examiner’s report on the

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comments received during the Formation Hearings on the City’s intention to form the LID (the

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“Hearing Examiner’s Report”).

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Section 3.

LID Improvements Ordered. Having completed the foregoing preliminary

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proceedings and in consideration of the Hearing Examiner’s Report, the City Council determines

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it to be in the best interests of the City that the LID Improvements as herein described be carried

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out and that a local improvement district be created in connection herewith. Therefore, pursuant

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to RCW 35.43.040, the City Council orders the construction of the LID Improvements. The LID

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Improvements shall be in accordance with plans and specifications prepared by the Director of

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the OWCP, on behalf of the Director of Transportation of the Seattle Department of

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Transportation, and on file in the City Clerk’s office, and may be modified by the City Council

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as long as such modifications do not affect the purpose of the LID Improvements or constitute

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materially different improvements; provided, however, that changes in detail of such plans that

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do not significantly alter the scope or costs of the LID Improvements will not require further

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approval.

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Section 4.

Local Improvement District Created. There is created and established a

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local improvement district, to be known as Local Improvement District No. 6751 of the City

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(interchangeably, “LID 6751” or the “Waterfront LID”). The boundaries of the Waterfront LID

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are described in Exhibit B attached hereto and by this reference incorporated herein. It is hereby

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found that the above-described boundaries embrace as nearly as practicable all the property

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specially benefited by the LID Improvements.

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Section 5.

Allocation of Costs. The total estimated cost and expense of design and

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construction of the Central Waterfront Improvement Program is estimated to be approximately

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$712 million. Notwithstanding the provisions of any other ordinance of the City, the total cost of

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(a) the LID Improvements, including the planning, design, and construction of the

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improvements, and (b) the estimated costs of creation and administration of the Waterfront LID

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(together, the “LID Expenses”), and the estimated financing costs (i.e., the costs of issuing the

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LID Bonds and estimated amounts necessary to fund a deposit to the LID Guaranty Fund), is

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declared to be approximately $346.57 million, all as described in Exhibit C to this ordinance.

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The portion of the LID Expenses that shall be borne by and assessed against the property

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within the Waterfront LID specially benefited by the LID Improvements shall not exceed

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$160 million plus the amounts necessary to pay the costs of financing (including the costs of

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issuing the LID Bonds and making a deposit to the LID Guaranty Fund). Assessments shall be

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made against the property within the Waterfront LID in accordance with the special benefits

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accruing to such property. The balance of the cost and expense of the LID Improvements shall be

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paid from other amounts available to the City, including philanthropic donations from

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individuals and organizations, consistent with the City’s overall funding plan for the Central

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Waterfront Improvement Program.

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Section 6.

Method of Assessment. In accordance with the provisions of RCW

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35.44.047, the City may use any method or combination of methods to compute assessments that

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may be deemed to fairly reflect the special benefits to the properties being assessed.

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Section 7.

Final Assessment Roll. Upon approval of this ordinance, an assessment

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roll shall be prepared and, after notice and hearing in the manner provided by law, the

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assessment roll shall be confirmed. The final confirmed assessment roll will be limited to an

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amount equal to $160 million plus the amounts necessary to pay the costs of financing and to

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make a deposit to the LID Guaranty Fund. All remaining costs and expenses of the LID

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Improvements and the Central Waterfront Improvement Program are to be paid from the sources

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identified in Section 5 of this ordinance or other amounts budgeted for this purpose in the future.

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It is the City’s intent not to pursue any future supplemental assessments to cover additional costs

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accrued during construction.

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Section 8.

Mode of Payment. In accordance with the provisions of SMC 20.04.050,

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the mode of payment for the Waterfront LID is “payment by bonds.” Assessments not paid

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within the 30-day prepayment period provided by law shall be payable in installments of

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principal and interest with terms to be fixed by future ordinance.
Section 9.

Deferral of Assessments for Economically Disadvantaged Property

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Owners. The collection of an assessment upon property assessed by a local improvement district,

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or any installment thereof, may be deferred as provided in RCW 35.43.250 and 35.54.100, as

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now existing or hereafter amended, upon the application of a person responsible for the payment

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of an assessment, who is economically disadvantaged. The City shall establish, in the ordinance

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confirming the assessment roll, the terms and conditions for the deferral of collection of such

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assessments, the persons eligible therefor, the rate of interest, the duties of the respective City

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officials and the obligations of the City’s previously created Local Improvement Guaranty Fund

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with respect thereto, all in accordance with chapter 20.12 SMC and RCW 35.43.250 and

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35.54.100.

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Section 10.

Local Improvement Fund Created. The Local Improvement District No.

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6751 Fund (“Waterfront LID Fund”) is created and established in the City Treasury for the

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purpose of paying the cost of the LID Improvements provided for in this ordinance and into

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which shall be paid all of the assessments collected in the Waterfront LID as and when directed

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by the ordinance confirming the assessment roll. The proceeds of interfund loans or other short-

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term obligations drawn against the fund which may be issued and sold by the City, and the

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collections of assessments, interest and penalties thereon, shall be deposited in the Waterfront

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LID Fund. Notwithstanding any other ordinance of the City (including provisions of the Seattle

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Municipal Code), the Director of the Finance Division of the Department of Finance and

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Administrative Services (“City Finance Director”) is authorized and directed to create within the

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Waterfront LID Fund such accounting designations as may be necessary to segregate the

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amounts available to be used to pay the costs of the LID Improvements from the assessments

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collected for repayment of the LID Bonds.
Section 11.

Construction of Improvements; Payment for LID Improvements.

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Notwithstanding the foregoing or the provisions of any other ordinance of the City, unless the

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authority to proceed is restrained by protest under RCW 35.43.180, the LID Improvements may

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be carried out in whole or in part under the provisions of RCW 35.51.020, Chapter 39.10 RCW,

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Article VII of the City Charter, Chapter 20.04 SMC or as otherwise authorized by law.

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Section 12.

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(a)

Authorization of LID Bonds and Interim Financing.

Bonds. The City is authorized to issue LID Bonds, in one or more series, for the

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Waterfront LID, which shall bear interest at a rate and be payable on or before a date or dates to

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be hereafter fixed by ordinance. The LID Bonds may be issued (i) to pay costs of the LID

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Improvements (including repayment of interfund loans or refunding of any and all short-term

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obligations issued to pay such costs), (ii) to pay the costs of creation and administration of the

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Waterfront LID, (iii) to pay the costs of financing, and (iv) to make a deposit to the LID

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Guaranty Fund. The LID Bonds shall be paid and redeemed by the collection of assessments to

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be levied and assessed against the property within the Waterfront LID, payable in annual

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installments, with interest at a rate to be hereafter fixed by ordinance under the mode of

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“payment by bonds,” as defined by law and the ordinances of the City. The form, amounts, dates,

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interest rates and denominations of such bonds hereafter shall be fixed pursuant to ordinance of

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the City Council.

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(b)

Interim Financing. In anticipation of the issuance of the LID Bonds, the City

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Finance Director or the Finance Director’s designee has previously been authorized in Ordinance

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125188 to loan funds from the City’s Transportation Master Fund or its participating funds to the

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Central Waterfront Improvement Fund, for a period beginning December 30, 2011. Pending

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issuance of the LID Bonds, the City may provide for the extension of this or additional interfund

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loans to pay for costs of the LID Improvements or for the issuance of short-term obligations

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pursuant to chapter 39.50 RCW or local improvement district notes in accordance with

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applicable law and ordinances of the City.

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(c)

Expenditures and Reimbursement.

The City on December 23, 2013, declared its

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official intent to reimburse itself for expenditures to be made for the LID Improvements (other

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than for any cost or expense expected to be borne by the City) prior to the date that any short-

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term obligations or local improvement district bonds are issued to finance the LID

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Improvements, from proceeds of interfund loans or other funds that are not, and are not

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reasonably expected to be, reserved, allocated on a long-term basis, or otherwise set aside to pay

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the cost of the LID Improvements.

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Section 13.

Restraint by Protest. The jurisdiction of the Council to proceed with the

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LID Improvements shall be divested by a protest filed with the Council within 30 days from the

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date of passage of this ordinance, all in accordance with RCW 35.43.180.

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Section 14.

Filing of Preliminary Assessment Roll. The Director of OWCP, on behalf

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of the Director of Transportation, filed the preliminary assessment roll and other information

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required by SMC 20.04.060 with the City Clerk on June 1, 2018. Notwithstanding the provisions

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of any other ordinance of the City, not later than 15 days after the passage of this ordinance, the

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Director of Finance and Administrative Services (FAS) shall post the preliminary assessment roll

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for Local Improvement District No. 6751 upon the Director’s index of local improvement

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assessments against the properties affected by the local improvement.

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Section 15.

Section Headings. The section headings in this ordinance are used for

convenience only and shall not constitute a substantive portion of this ordinance.
Section 16.

Ratification. Any act consistent with the authority of this ordinance taken

prior to its effective date is ratified and confirmed.

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Section 17.

Effective Date. This ordinance shall take effect and be in force 30 days

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after its approval by the Mayor, but if not approved and returned by the Mayor within ten days

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after presentation, it shall take effect as provided by Seattle Municipal Code Section 1.04.020.

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Passed by a majority consisting of more than two-thirds of all of the members of the City

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Council the ________ day of _________________________, 2019, and signed by me in open

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session in authentication of its passage this _____ day of _________________________, 2019.

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____________________________________

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President ____________ of the City Council

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Approved by me this ________ day of _________________________, 2019.

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____________________________________

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Jenny A. Durkan, Mayor

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Filed by me this ________ day of _________________________, 2019.

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____________________________________

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Monica Martinez Simmons, City Clerk

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(Seal)

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Attachments:
Exhibit A – Waterfront LID Improvements
Exhibit B – Waterfront LID Boundaries
Exhibit C – Waterfront LID Improvements Cost Estimate Summary

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