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The Gristle

PDA DOA?

Tuesday, November 27, 2012

PDA DOA?: Just as the target at last finally drifts into view, Bellingham policymakers may lose one steely arrow in their quiver for negotiations on the future of the city’s central waterfront. In their budget talks this month, Bellingham City Council appeared uncertain about the future of its Public Development Authority, created in 2008 to help manage city assets and develop public-private partnerships that might assist in the redevelopment of the former Georgia-Pacific mill site and adjoining properties.

The Bellingham PDA was modeled after similar organizations around the country that assist in large-scale redevelopment projects, such as the successful redevelopment by the Port of Tacoma of a portion of that city’s waterfront. Implicit in their creation is the understanding that elected policymakers are often unsuited to detailed property negotiation, and general purpose municipal governments often lack the instruments to focus on grand projects of this magnitude. An ideal PDA, then, is an association of private developers and entrepreneurs appointed by city administration and led by someone who has managed this sort of public-private partnership before. The city got that in organizing the Bellingham PDA and its accomplished executive director, Jim Long.

Yet also implicit in the creation of the Bellingham PDA was the understanding of former Bellingham Mayor Dan Pike that he needed an instrument to help defend city interests and push back against the port’s intransigent negotiating style of thimblerigging and gaslighting his administration around phony panic deadlines and fraudulent assertions.

Early on, City Council had surrendered much of its braking authority and bargaining tools, with several members declaring openly that they would not in any way impede the port’s $150 million diamond plan for the waterfront. The city had early on surrendered its rights to collect taxes or fees on developments there, and thus their ability to forgive and forgo those collections as a bargaining chip to help steer the plan in appropriate ways. And, critically, the city had early on surrendered its powerful position as lead agency in the environmental review, in effect letting the contractor write the contract.

The Pike administration considered the PDA might ease a growing friction between the city’s weak and pliant negotiating position and that of the port.

Ideally, both organizations would form and fund the PDA; and the authority would act on behalf of and in the interests of both. Through rents and revenues collected on key public properties, the PDA could be self-funding and self-sufficient.

The port, however, perhaps correctly perceiving that a joint public-private development authority might inject compromise and outside competence into their plans, declined to contribute to the PDA, crippling its efficacy and dooming its ultimate success.

Kelli Linville entered office in 2012 critical of Dan Pike’s stalled negotiations with the Port of Bellingham. Like the port, she perhaps perceived the PDA more as obstacle than instrument in rekindling those negotiations. And with negotiations stalled and waterfront redevelopment plans underwater, the very purpose of a costly PDA seemed unclear to her. For certain, the PDA is not recovering its own costs, as originally imagined.

“The timing was bad for our PDA because we were right into the recession,” Linville explained.

Early in drafting a proposed 2013 city budget, Linville proposed an end to the authority’s $358,000-a-year appropriation from the general fund to help balance that budget by 2015.

It’s an uncomfortable moment to abruptly dissolve the PDA, just as the city prepares to close on joint master planning next year. The purpose of the organization is only this moment coming into focus. Moreover, the PDA in 2011 engineered the sale of city property at Cornwall and Maple streets (at a substantial loss of more than a quarter of a million dollars to the city’s often-raided parking fund) in order to finance early waterfront infrastructure staging near Central Avenue at Army Street. The sale raised $1.2 million. The staging could help address some of the thornier street alignment and access problems into the former mill site.

The PDA also manages other properties along Whatcom Creek, again key to tying the waterfront district to Old Town. Indeed, the PDA’s suggested alternate for the waterfront district is in many respects superior to the port plan, particularly in its understanding of traffic flows and view corridors.

In a special work session with the council on the budget, Mayor Linville proposed that some portion of that $1.2 million could allow the authority and Director Long to energize their work finding tenants for city-owned properties through 2013 as a means to make the PDA self-funding. At the very least, her proposal would allow the PDA to weigh in on the master plan, even as the organization winds down. Long, perhaps perceiving all this could take longer, proposed an alternative that would keep the PDA operating through 2014, at which point—he predicted—the city would begin to more than recover its investment on redeveloped properties. He estimated that could be worth more than $120 million if fully developed according to PDA plans.

Council appears torn between the brushfire clearing proposed by the mayor, or the longer burn suggested by Long. Several chafe at the raid on the parking fund and the forfeit of any immediate parking solution downtown. Others wonder about the raison d’etre of a development authority missing two of three development partners: The port, and private sector interest.

Admittedly, wound through into the authority’s DNA is Dan Pike’s more aggressive approach to push back against the weakest elements of the port’s plan. That push should continue.

SVCR Don McLean
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