Who Will Take Care of the Kids?

img_3803(Wave Writer, September 2011)

Magnuson Developer Sues Seattle for $4 Million

We’ve all seen it, a relationship that seemed great from the outside. You know what I mean, that compatible couple with so much in common with no reason to split apart and every reason to stay together.

The next thing you know, they separate and start filing things in court. And, they both feel like victims. Counseling just doesn’t help at all.

Such is the case with the Building 11 mess at the Warren G. Magnuson Park in Seattle. The honeymoon appears over for the city and the developer, Building 11 LLC. To torture the analogy just a bit more, the kid involved, Sail Sand Point, and the very real kids it will serve in the decades to come, are caught in the middle.


It all came to a head in the middle of last month with the City Council approved a modified lease and submitted it to the Building 11 LLC. The LLC took a look at it, and said nope, this won’t work for us, and responded by filing a $4 Million lawsuit in King County court.

Why should any of us care about this? First of all, we need to give the small boat public access to the water and a place to keep their boats at a reasonable cost. We have already lost generations of boaters because the only places to keep boats are behind fences and have big price tags. There just is not much public access in a city that should make this a high priority.

Secondly, Sail Sand Point is an amazing institution. All parties are agreed. It’s a beehive of activity that does its thing without public funds, exposing thousands of kids and adults of all financial means to the wonders of sailing and the water.img_3814

But perhaps the biggest reason we should care is because this is an opportunity to make boating and water access a priority, to make this city appreciate just what it has in its waters and its boating communities. In many ways, Seattle has bungled Sand Point. Disparate groups have grabbed little pieces for themselves, and the result is a hodgepodge of interests that may or may not work together in the years to come. And from nearly every perspective, the amazing potential that is Sand Point seems destined never to be realized.

A Brief History

Starting back in the 1970s the US Navy started decommissioning the Naval Air Station at Sand Point and transferring stewardship of parts of it to the City of Seattle. The Navy finished the task in 1998, giving Seattle one of the most amazing facilities the city could ever ask for. On the shores of Lake Washington, the 350-acre facility had the potential to redefine a public park for the world. That’s no exaggeration, as there was open space, water access and some basic infrastructure already in place. The one thing it needed, but which was never implemented, was a cohesive master plan.

There was a plan, as outlined the Blue Ribbon Committee report of 1999 to Mayor’s office. It’s a fascinating document, a glimpse at what might have been. The report authored by ex-Mayor Royer included a community and cultural center, a fishpond and, you guessed it, a small craft center at the north end where Sail Sand Point currently sits. It also had a plan for managing the site to be led by an independent, apolitical, not-for-profit “Board”. The city would be responsible for finding funding. The park’s status, the report states, “should be elevated within the (Parks and Recreation) Department that that of other regional facilities such as the Zoo and Aquarium.”

Thirteen years later, much of Magnuson is still up for grabs, a bit going here and a bit going there as various interest groups and businesses try to make their grab.

The Navy handed over the property with a few strings attached, however among those strings were ones that the city use the property to provide public benefit, recreation and water access.

At issue is the historic Building 11, a decrepit but incredibly well located 58,000+ sq ft. structure that at one time housed workshops and offices commensurate with a working US Navy base. It’s adjacent to a tiny harbor with docks and boathouses, and a huge paved area that once served as the seaplane tarmac. The immediate waters are protected, especially from strong southerlies.

None of this was lost on Jonathan and Marcy Edwards. In 1993 they had founded a public access program at Leschi on behalf of Corinthian Yacht Club called the CYC Sailing Camp. As the grab for Sand Point began, they split from CYC and moved into Building 11 with the blessing of the City and its’ Parks department. After all, the City was eager to have some activity, and quickly. It was nothing fancy, but the Edwards knew sailors don’t need anything fancy, not even showers. All they need is the opportunity to sail.  Some artists started renting some unused space as well. The rent was right and they too weren’t looking for anything fancy.

PPP to the Rescue

Things were going along pretty well. Sail Sand Point was thriving and Building 11 had paying tenants. All good things, however, must end. It became apparent that Building 11 didn’t come close to fulfilling any modern safety codes and that it was, in fact, dangerous to remain in the building in its present condition. Something had, and has, to be done.

The City of Seattle had, and has, no money for fixing Building 11. In the chaos that is Magnuson, money has come down in bundles for some projects like massive playing fields, but for much of the rest of  the area there seems to be no plan and/or no money. In the meantime, non-profit and for-profit entities such as The Mountaineers and Arena Sports have been making successful grabs, with detailed plans, for buildings at Magnuson.

In order to fix the Building 11 problem, the city put out a Request For Proposal for Building 11 in 2006. Suffice it to say there was one proposal, from a purpose –formed corporation called Building 11 LLC. Two members of the LLC, Chris Raftery and Bill Fuller, had put kids through the program at Sail Sand Point. The LLC had a reasonable plan that seemed to answer most of the questions surrounding the project. It was one of the Public Private Partnerships (PPPs) that are seen by many as the best way to get public works done these days.

We wouldn’t, as the public, actually want to take responsibility for public facilities ourselves, would we? Who knows what that might lead to? First thing you know, you have things like National Parks and city playgrounds. (Apologies for the sarcasm.)

At the time it seemed reasonable. Sail Sand Point would be assured a home, and the LLC would be assured very favorable lease terms. Basically, they’d put up the money and expertise to build (more like rebuild) Building 11. In turn, the LLC would receive offsets for that investment in its lease with the city. The LLC promised to stay within the zoning guidelines of providing water access and public benefit and rent the rest of the building out at commercial rates that would in effect subsidize the public benefit.

The thought of sharing the building with a daycare facility and restaurant, along with other water-related businesses, seemed an OK compromise to Sail Sand Point supporters. The important thing was that it had a home.

As the economy went up, down and up over the last three years, the LLC apparently started looking at the economic possibilities and sharpening its pencils. The LLC started working with the Mayor’s office on an amended lease. There were some housekeeping items that had to be dealt with, namely some language in the lease to protect a lender for the project, an addition of an outside play area for a daycare and non-disturbance language requested by SSP.

From this point on things started to get ugly. First off, it seemed like the negotiations between the mayor’s office and the LLC were, if not done in a smoky back room, at least in someplace where one would be exposed to second hand smoke. Folks wary of the LLC started marshalling forces. When the amended lease came down to the City Council from the Mayor’s office, the Council could hear the screams of protest and the cries for war.

Included in the document (Council Bill 117196) that emerged from the Mayor’s office was a telltale reference under Permitted Commercial Uses to “clinical, optical, pharmacy, imaging, pediatrics, adult care and laboratory uses.” The medical lingo referred to potential tenant Virginia Mason, which was eager to locate a pediatric clinic in Building 11. It would dominate the “new” Building 11, its traffic plans and general feel.

Hmmm. Why would a private medical facility be located in a public park in an area set aside for recreation, public benefit and water access? For many of us, it was just plain wrong for that building to be dominated by a clinic and assorted medical facilities. The daycare center that was and is on tap to lease, Bright Horizons, is part of a nationwide organization set up as a daycare center for private corporations. The Bright Horizons web site proudly points out that it serves 90 of the fortune 500 companies.

Somewhere around here, when terms could not be agreed to between the LLC and some of its tenants such as the Hobie Cats Northwest and the artists, eviction notices were sent out. That may have been the ultimate “gloves off” moment in this fight.

It just didn’t seem at all like Building 11 was going to be a hub of water-related recreation if the proposed amended lease was to pass as submitted from the Mayor’s office. Water related businesses were getting kicked out and a private clinic and exclusive daycare facilities seemed set to move in. Where were all the public benefits? But the Council did not rubber stamp it and the contents of this bill became known to the general public. With gloves off, it immediately became a bloody affair.

Enter Sally Bagshaw and the Seattle City Council. Bagshaw, who was elected to the City Council in 2010, is Chair of the Parks and Seattle Center, and the waterfront Planning Committees. When handed the proposed amendment from the Mayor’s office, she started reading it and wondering if it was a fair deal for the City and its taxpayers.

A tornado of emails and public testimony ensued. The thought of a massive clinic and daycare center dominating the facility, adding congestion and literally pushing water related activities to the periphery was very upsetting. Curiously, as all this was going on in June, Sail Sand Point and the LLC came to terms and signed a sublease agreement.

The more Bagshaw looked at the proposed amendment, the less favorable it looked to the taxpayer. In the end, her committee offered two revised versions of the amendment to be considered, “A” and “C.” In the end, version A was passed out of committee and the full City Council. There were a few unpleasant nuggets in this proposed lease that shifted the potential benefits away from the LLC and toward the taxpayer, including a historic tax credit change and a public benefit offset modification. But nobody seemed happy with it. Opponents of the LLC grudgingly accepted it as the lesser of evils.

Perhaps the biggest change from what emerged from the mayor’s office was a resounding “NO” to Virginia Mason in the form of a determination by the City of Seattle Department of Planning and Development that the medical clinic, pharmacy et. al. were not allowed under applicable zoning.

So, the LLC, which must have at one point felt pretty comfortable with two solid tenants anchoring the financial aspects, was left staring at an amended lease that simply did not work for them.

What to Do? Sue.

It took about a week, but on August 16 the LLC sued the City of Seattle in King County Court for $4 Million. The grounds for the suit were many, but basically the LLC complaint states that the city “repudiated its lease obligations” and “violated its duty of good faith.”

Not only did the LLC name the city, but also specifically cited Sail Sand Point’s Executive Director Morgan Collins and Treasurer Leslie Keller.

In today’s increasingly polarized world, the arbiter always seems to be the courts. If you’ve paid any legal bills lately, you know these can dwarf things like asbestos removal (which, incidentally, was proceeding while the lawsuit was being filed). The courts will end up shoveling through mountains of leases and proposed leases, letters of intent and so on and figure out who was legally right and wrong. Remember, the court doesn’t decide in terms of what’s right for the public, or what’s right for the kids, or what’s right for the developer. The court is tasked simply with interpreting the law.

And it’s very possible that any decision emerging from the court won’t serve anyone very well. And it’s pretty certain that the longer this situation is in the courts, the more money will go to the lawyers instead of improving the facility.

Unless, of course, some sort of agreement can be figured out in the meantime. If one wades through the documents, and they’re all available, one will find numbing complexity in these issues. The way this whole Building 11 controversy has moved along, I see little chance of it getting figured out without some binding arbitration or court decision. And compromise.

Nobody here wants to be seen as the bad guy, least of all some of the folk involved in the LLC. “If we would have known that it would have been this controversial, we would have never become involved," says Chris Raftery of the LLC. I believe him and I believe there are some good intentions. That said several other people with different types of involvement with this controversy simply refuse to work with the LLC. The general feel is that the LLC will stop at nothing to get its way and the lawsuit only reinforces this.

Personally, I am losing hope for this situation to have a good outcome, and it angers me. I was one of the early volunteers at Sail Sand Point and have referred countless boaters to the facility in the past 13 years. I’ve watched some very selfless and dedicated people work hard to give kids and adults boating opportunities. We cannot let this program die in some kind of scorched earth legal war.

I hold the City of Seattle mostly responsible for this mess. It had the chance to do something truly great with Sand Point and it did not. And while it’s been obvious from the start how contentious the Building 11 situation is, the actions of the Mayor’s office and City Council only exacerbated the problems. The city abdicated its oversight responsibility, expecting the invisible hand of free enterprise to take care of everything. As a taxpayer, I’m furious about the public money that will surely go down the tubes with this lawsuit.

Perhaps there is no hope for the LLC, the City and Sail Sand Point to come together. Maybe it is all about the money. If so, it seems there should be a simple way to move forward even if it means ending a relationship permanently. It might be expensive; it might even cost millions of dollars. The fact of the matter is that the building will need to be fixed if it is to be used and Sail Sand Point has some very modest needs to keep fulfilling its mission.

At this point, I think as boaters our main concern should be the kids that will benefit from a healthy Sail Sand Point in the decades to come. When I took the photos that accompany this story, Sail Sand Point was a beehive of activity with kids in class, on the water and maintaining the facility. Kayaks were being launched and there was a yard full of small boats that get used instead of sent to a landfill.

I’m sure we will hear more about this in the months to come. I ask that boaters let the City know that this community needs Sail Sand Point and a small craft center at the north end of Magnuson.


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