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20070404 HE Signed Decision 06272016Yelm Creek Building, LLC 240 Stadium Way South Tacoma, WA 98402 City of Yelm Community Development Department 105 Yelm Avenue West P.O. Box 479 Yelm, WA 98597 June 27, 2016 RE: 20070404 Yelm Creek Mixed Use Binding Site Plan Dear Applicant: Transmitted herewith is the Report and Decision of the City of Yelm Hearing Examiner relating to the above - entitled matter. Very truly yoursLUS T N . C 9(; JR. Hearing Examiner SKC /jjp cc: Parties of Record CITY OF YELM OFFICE OF THE HEARING EXAMINER CITY OF YELM REPORT AND DECISION CASE NO.: 20070404 Yelm Creek Mixed Use Binding Site Plan APPLICANT: Yelm Creek Building, LLC 240 Stadium Way South Tacoma, WA 98402 AGENT: Sound Engineering, Inc. Attn: Tim Holderman 5007 Pacific Highway East, Suite 7 Fife, WA 98424 SUMMARY OF REQUEST: Subdivide approximately 11.04 acres into three parcels through the binding site plan process. The property is located at 10520 Creek Street and is identified by Assessor's Tax Parcel Number 64303400400. The property is zoned Heavy Commercial (C -2). SUMMARY OF DECISION: Request granted, subject to conditions. PUBLIC HEARING: After reviewing Community Development Department Staff Report and examining available information on file with the application, the Examiner conducted a public hearing on the request as follows: The hearing was opened on June 13, 2016, at 9:25 a.m. due to a malfunction of the recording equipment. Parties wishing to testify were sworn in by the Examiner. The following exhibits were submitted and made a part of the record as follows: EXHIBIT "1" - Community Development Department Staff Report with Attachments EXHIBIT "2" - Photographs of the Site EXHIBIT "3" - Excerpts from City Codes and the RCW -2- TAMI MERRIMAN appeared, presented the Community Development Department Staff Report, and testified that binding site plan approval would create three parcels and a shared access parcel. The applicant previously acquired SPR approval for the apartments and commercial uses. The applicant has constructed the apartments and the two commercial uses are prepared. Abutting uses to the north, south, and west are commercial, and Yelm Creek is to the east. The City received one comment regarding the access limited to one driveway, but the City will authorize additional accesses in the future. Two accesses from Creek Street exist at present. Notice was provided on June 1 and not May 23, and notice was published on June 3, and not May 27. The sole issue in the matter is concurrency review, and specifically, the level of service for water. The City presently has 420 connections for new development that will accommodate two to three years of growth. The City will apply for new water rights with the Department of Ecology. Here, all infrastructure is present to serve the commercial parcels and both water and sewer lines are ready for connection. The City has not received a SPR application for either commercial site, and therefore they will develop at an undetermined time in the future. It is not possible for the City to guarantee water indefinitely. If the Examiner approves the BSP, the City wants certainty with conditions. The City has already committed to proved sewer service, and the project meets all other requirements for BSP approval. Transportation is concurrent as frontage improvements were previously constructed on Creek Street, and the TIF has been paid for the apartments and will be imposed on future commercial development. Fire and schools also meet concurrency. A MDNS was issued pursuant to SEPA review in 2008 and the project meets all mitigating measures. Staff recommends denial because with no timing for improvement, the City cannot guarantee water use with reasonable certainty. If the project is approved, then staff strongly encourages conditions of approval. WILLIAM LYNN, attorney at law, appeared on behalf of the applicant and testified that the largest water consumption development is already constructed and connected. The apartments are fully developed. He introduced Exhibit 2, photographs of the site, and asserted that the applicant has met concurrency. He introduced Exhibit 3, excerpts from City codes and the RCW. The BSP process is exempt from the subdivision process. He disagrees that the City must consider the subdivision statute. He referred to the YMC and asserted that the City has adequate water at present. Section 18.16.060 provides specifically that the City does not guarantee availability of water or sewer, and that there is a difference between preliminary and final approval. As of now, water is available and by express provision of code, provides no guarantees as to the future. The site is ready today and someone could submit a building permit application soon. It is ironic that the City insisted on the provision of all infrastructure, but then cannot find that the applicant has provided concurrency. The City has been aggressive in making the applicant improve the site, but then can't find concurrency. The apartments are fully served with water and the applicant needs the BSP approval to sell or develop the property or to finance it. He referred to the previous case decided by the Examiner and has no objection to the findings, conclusions, and conditions entered therein. MS. MERRIMAN reappeared and testified that the BSP is exempt from subdivision approval, but that it is another form of subdivision. The applicant is creating more parcels. In the preliminary approval the City must expect to have water, and at the building permit stage the final facts are decided. The site plan review approval is not part of the subdivision process. MIKE AVILA appeared and testified that it is difficult to sell a commercial property without a certainty of water. They have a prospective tenant and could apply for a building permit soon, but they need the utilities available. No one spoke further in this matter and so the Examiner took the request under advisement and the hearing was concluded at 10:00 a.m. NOTE: A complete record of this hearing is available in the City of Yelm Community Development Department. FINDINGS. CONCLUSIONS AND DECISION: FINDINGS: 1. The Hearing Examiner has admitted documentary evidence into the record, heard testimony, and taken this matter under advisement. 2. The City of Yelm Responsible Official issued a Mitigated Determination of Nonsignificance (MDNS) for the project on March 4, 2008, following review pursuant to the State Environmental Policy Act (SEPA). Mitigating measures required the payment of transportation facility charges, specific improvements to Creek Street, high ground water reports, and the removal of onsite septic and exempt wells. No appeals of the MDNS were filed. 3. Notice of this application was mailed to state and local agencies and property owners within 300 feet of the project site on March 31, 2016. The notice of Application was advertised in the Nisqually Valley News on April 8, 2016. Notice of the date and time of the public hearing before the Hearing Examiner was posted on the project site and on June 1, 2016, mailed to the owners of property within 300 feet of the project site and to any person that commented on the project. Notice of the date and time of the public hearing was published in the Nisqually Valley News in the legal notice section on June 3, 2016. 4. The applicant has a possessory ownership interest in a rectangular, 11.04 acre parcel of property abutting the east side of N.E. Creek Street immediately north -4- of its intersection with Yelm Avenue East within the City of Yelm. The parcel abuts N.E. Creek Street for 450 linear feet and measures 1,150 feet in depth. 5. Improvements on the site include 164 multi - family residential units with associated parking and two commercial pads located between the multi - family dwellings and N.E. Creek Street. A 40,855 square foot Tract A extends between N.E. Creek Street and the two commercial units and is improved with parking spaces and a drive aisle. An 8,345 square foot Tract B is located along the south property line south of Tract A and the commercial pads and provides a common driveway access to both uses. The applicant requests binding site plan (BSP) approval to allow segregation of the parcel into three units and two tracts. Unit 3 would consist of 403,070 square feet and would contain all of the multi - family units and associated parking. Unit 2 would contain 13,960 square feet and is improved with one of the commercial pads. Unit 1 would contain 115,305 square feet and is improved with the second commercial pad. Notes on the BSP provide that Tract A will consist of a common area tract and Tract B will consist of a joint access and utilities tract. 6. All multi - family units are occupied or are available for occupancy and are served by all utilities to include potable water and fire flow. The commercial pads (Units 1 and 2) are ready for improvement, and BSP approval would allow the applicant or future owners of the units to apply for a building permit. However, the City is unaware of any potential tenants, and once BSP approval is granted, the units could remain unimproved for at least five years into the future. Section 18.14.070(D) YMC provides that a term of a BSP is five years from the date of approval. Thus, the applicant or future owner must apply for a building permit within said time period. 7. The primary issue concerning BSP approval concerns the City's ability to provide potable water to the commercial parcels at building permit issuance. The City is the sole water provider within the City limits. Since 1994 the City has recognized the need for and has attempted to acquire new water rights to serve development within the City. In 2010 the Washington State Department of Ecology (ECY) approved additional water rights that would allow the City to serve the BSP parcel and other development within City limits. ECY's approval was subsequently appealed but said appeal was denied by both the State Pollution Control Hearings Board and the Thurston County Superior Court. However, the State of Washington Supreme Court in a decision entitled Sarah Foster v. The Department of Ecology, et. al., 184 Wn. 2d 465 (2015), issued on October 8, 2015, reversed the decisions of ECY, the Board, and the Superior Court. As a result the City did not acquire additional water rights and as of June 13, 2016, (the date of the hearing) the City had 420 connections for new development. The City anticipates that such number will accommodate two to three years of growth at historical rates. -5- 8. The City expects to reapply for additional water rights but has no estimation as to when additional water will become available based upon the timing of ECYs processing the new application and the possibility of further appeals. Following final approval of the BSP, future owners of Units 1 and 2 could apply for a building permit, and at that time ask the City to provide water. The City asserts that because of its limited number of connections and because it has no application pending for additional water rights, the BSP does not provide concurrency for water infrastructure. 9. The applicant asserts and the City agrees that both commercial pads are "shovel ready" for improvement with commercial buildings. Furthermore, the applicant's real estate broker testified that while he has a potential tenant who could submit a building permit application in the near future, the applicant could not make such a guarantee. However, approval of the BSP will remove uncertainty from the sale of the units, and could result in a building permit application in the near future. Furthermore, even if no application is readily forthcoming, the applicant asserts that the risk of having no water availability at building permit application is its own and not that of the City. 10. Concurrency requires an evaluation of water availability at the time that development will actually occur. The determination necessarily involves a forecast and some judgment. In the case of a preliminary plat application that is approved by the Hearing Examiner, the Yelm Municipal Code (YMC), addresses water concurrency as follows: b. Water. At the time of preliminary approval, the planned infrastructure identified in the six -year improvement program and water rights acquisition program of the water system plan are sufficient to provide for the proposed land division (YMC 18.16.050.C.1(b)). The same language would apply to a BSP segregation. This language requires fact specific findings regarding the particular proposal under consideration. Said section does not impose a moratorium on development but does require the City and the Examiner to evaluate each project on a case by case basis. The Examiner has no authority to impose a moratorium and must evaluate each project individually as to the probability of water availability at either final plat approval or building permit application. 11. In the present case it is more probable than not that potable water will be available at the issuance of building permits for the two commercial pads. Such finding is based on the specific characteristics of the overall site to include the previously constructed, 164 multi - family units, all of which have water connections. All waterlines are installed on each commercial unit and are available for connection to a use on each unit. All engineering and site preparation is complete, and the applicant will market the commercial units -6- immediately. The City's approval of the BSP will not require a Certificate of Water Availability as such will be provided only at building permit application. The City has also fully disclosed to the applicant the limited number of water connections that remain available. The City also recommends denial of BSP approval based upon the possibility of lack of water availability at building permit application. 12. The finding of concurrency of potable water is also based in part on the applicant's previous construction of the two commercial pads, the construction and occupancy of 164 multi - family units, and the previous construction of all infrastructure to include sewer and waterlines to both pads. The City has also acknowledged that at expected growth rates, potable water should be available for two to three years without additional water rights. However, the Yelm City Council has not adopted procedures or standards for determining priorities for the issuance of water availability letters, and therefore other projects may gain approval before the applicant or future owner can submit a building permit. Thus, water may not be available upon building permit application. 13. The applicant has referred the Examiner and the City to YMC 18.16.060 that reads: The factors affecting available capacity, in some instances, lie outside of the city's control. The city's adoption of this chapter relating to the manner in which the city will make its best attempt to determine infrastructure capacity does not create a duty in the city to provide water or sewer service to the public or any individual, regardless of whether a finding of concurrency has been made. A finding of concurrency is not a guarantee that water and /or sewer will be available to serve the proposed project at the time a building permit application is made. (emphasis added) The above section, the applicant's referral of said section to the Examiner, and the applicant's assertion that the risk lies with the applicant and not with the City should water not be available, places the risk of the lack of water availability squarely on the applicant. A condition requires a note to this effect on the BSP. 14. Prior to obtaining approval of a BSP the applicant must show that the request satisfies the criteria set forth in YMC 18.14.070. Findings on each criteria are hereby made as follows: A. The BSP makes appropriate provisions for the public health, safety, and general welfare for open spaces, drainage ways, streets, roads, alleys, other public ways, transit stops, potable water supplies, sanitary waste, parks and recreation, playgrounds, schools and school grounds, -7- sidewalks, and other features assuring safe walking conditions for students who only walk to and from school. The project site is within the City's Sewer Comprehensive Plan, and the previously constructed apartments are currently connected to the City's STEP sewer system. The applicant may connect the commercial units to a sewer main located in the parking area of the future commercial development. The City has previously approved and the applicant has installed a stormwater system for the entire site. The applicant also recorded an agreement to maintain the stormwater system. Creek Street, and the internal street are constructed to current City standards, and Transportation Facility Charges (TFC) were paid for the residential units. The applicant will pay the TFC charges for the future commercial development at issuance of building permit. Parking for the entire site was reviewed and approved during site plan review. As previously found the project makes appropriate provision for potable water supplies. A school mitigation agreement was recorded and paid at the time of building permit issuance for the residential portion of the BSP. Creek Street improvements include a sidewalk along the east side of said street that provides safe walking conditions. B. The BSP serves the public use and interest by providing an appropriate location for two commercial uses in the downtown area of Yelm that will have convenient access for pedestrian shoppers. The commercial buildings will provide a buffer from the traffic on N.E. Creek Street to the multi - family dwellings to the east. C. The proposed BSP conforms with the applicable Heavy Commercial (C -2) zone classification of the YMC. The applicant must show that any future use of the pads is compliant with uses allowed in the C -2 classification. The applicant satisfied development regulations in the YMC during construction of the apartment complex. The project provides open space and recreation by dedicating the riparian habitat buffer along Yelm Creek as open space and by providing a clubhouse and swimming pool for the residential dwellings. D. Public facilities are adequate and available to serve the BSP concurrent with development. E. Sewer service is available to the site. F. At building permit stage the City will determine compliance with the Unified Development Code relating to property lines should a tenant or owner propose usage outside of the exterior walls of the buildings. -8- CONCLUSIONS: 1. The Hearing Examiner has jurisdiction to consider and decide the issues presented by this request. 2. The applicant has shown that the request for binding site plan approval satisfies all criteria set forth in YMC 18.14.070 and therefore should be approved subject to the following conditions: 1. Civil construction plans shall be provided at development of the future commercial area. 2. The applicant shall mitigate transportation impacts based on the new P.M. peak hour trips generated by the future commercial development. The Transportation Facility Charge (TFC) fee is subject to change. Actual costs shall be determined at building permit issuance. 3. Connection to the water system will be required at the time of future commercial development. The connection fee and meter fee will be established at the time of building permit issuance. 4. Connection to the sewer system will be required at the time of future commercial development. The connection fee and inspection fee will be established at the time of building permit issuance. 5. Prior to the submission of final plat application, a subdivision name must be reserved with the Thurston County Auditor's Office. 6. The applicant shall provide a performance assurance device in order to provide for maintenance of the required landscaping until the homeowners' association becomes responsible for landscaping maintenance. The performance assurance device shall be 150 percent of the anticipated cost to maintain the landscaping for three years. 7. This BSP approval is governed by Section 18.16.060 of the Yelm Municipal Code that was specifically identified and referred to by the applicant. Said section reads as follows: The factors affecting available capacity, in some instances, lie outside of the city's control. The city's adoption of this chapter relating to the manner in which the city will make its best attempt to determine infrastructure capacity does not create a duty in the city to provide water or sewer service to the public or any individual, regardless of whether a finding of concurrency has been made. -9- A finding of concurrency is not a guarantee that water and /or sewer will be available to serve the proposed project at the time a building permit application is made. (emphasis added) The above quoted language; the fact that the applicant specifically referred the Examiner to said language; and the applicant's assertion that the risk of water not being available at the time of submittal of building permit application lies completely with the applicant and not with the City shall be placed in a note on the BSP. DECISION: The request for binding site plan approval for the Yelm Creek mixed use binding site plan is hereby granted subject to the conditions contained in the conclusions above. ORDERED this 27th day of June, 2016 0 l�y STEPHEN K. CAUSSEAUX, JR. Hearing Examiner TRANSMITTED this 27th day of June, 2016, to the following: APPLICANT: Yelm Creek Building, LLC 240 Stadium Way South Tacoma, WA 98402 AGENT: Sound Engineering, Inc. Attn: Tim Holderman 5007 Pacific Highway East, Suite 7 Fife, WA 98424 OTHERS: Bill Lynn P.O. Box 1157 Tacoma, WA 98401 Mike Avila P.O. Box 1927 Eatonville, WA [ftIV 01WAaI>•il Michael Brown 16510 -106th Avenue S.E. Yelm, WA 98597 CASE NO.: 20070404 Yelm Creek Mixed Use Binding Site Plan NOTICE All final decisions of the hearing Examiner may be appealed to the City Council at a closed record appeal hearing, initiated by a person who has standing to appeal. All appeals must be filed within 21 days from the date of the decision being appealed in accordance with Section 18.10.100 Yelm Municipal Code.