09/25/2019 Workshop Meeting Packet

NOTICE OF WORKSHOP MEETING Council Chambers, 865 SE Barrington Drive

NOTICE IS HEREBY GIVEN that the Oak Harbor City Council will hold a Workshop Meeng on September 25, 2019 at 5:00 PM to discuss the following agenda items. This meeng will be held in the Council Chambers, 865 SE Barrington Drive . DATED this 20th day of September 2019. Carla Brown, City Clerk

The City Council may meet informally in workshop sessions (open to the public) to do concentrated strategic planning, to review forthcoming programs of the City, receive progress reports on current programs or projects, or receive other similar information from the City Administrator, provided that all discussions and conclusions thereon shall be informal. Public comment is not normally allowed at workshop meetings, although Council may allow, or request participation.

CITY COUNCIL WORKSHOP MEETING AGENDA SEPTEMBER 25, 2019 AT 5:00 PM

5:00 p.m. MAYOR 5:05 p.m. DEVELOPMENT SERVICES a. HISTORIC PRESERVATION COMMISSION CODE AMENDMENTS b. LAND USE APPROVALS AND HEARING EXAMINER APPROVAL CODE CHANGES c. DESIGN GUIDELINES d. SHORELINE MASTER PROGRAM PERIODIC REVIEW: DOE GRANT 5:45 p.m. FINANCE a. UTILITIES PROPOSED CODE AMENDMENTS & EFFICENCIES 6:00 p.m. LEGAL DEPARTMENT a. PRIVATE SMOKING FACILITIES REGULATIONS b. FOLLOW-UP ON CONFLICT INDIGENT DEFENSE SERVICES 6:20 p.m. PUBLIC WORKS a. DEPARTMENT OF ECOLOGY GENERAL NUTRIENT REMOVAL PERMIT COMMENTS b. ENVIROISSUES CONTRACT AMENDMENTS NO. 2 & NO. 3 6:45 p.m. ADMINISTRATION a. AFFORDABLE HOUSING STATE SALES TAX CREDIT FOR LOCAL GOVERNMENT b. CITY ADMINISTRATOR'S REPORT 7:00 p.m. CITY COUNCIL Times for each department are approximate. A time slot scheduled for a specific September 25, 2019 Workshop Meeting Packet 1 department may be revised (earlier or later) as the Workshop progresses. City of Oak Harbor Date: September 25, 2019 City Council Subject: Historic Preservation Workshop Agenda Bill Commission Code Amendments

FROM:Steve Powers, AICP, Director Development Services

SUMMARY STATEMENT During the June meeting of the Historic Preservation Commission, the commissioners and staff participated in a training session provided by Kim Gant from the Department of Archeology and Historic Preservation (DAHP). During that presentation, a few potential changes to the Oak Harbor Historic Preservation Ordinance were discussed. Among them: 1. Discrepancies between the adopted Oak Harbor Historic Preservation code and the model version provided by DAHP. In the time that Oak Harbor staff first started the process of becoming a CLG, the model ordinance that DAHP provides to local jurisdictions was slightly modified. 2. The number of commission members was set at seven when the ordinance was in the discussion stages and subsequently adopted. The initial composition of the commission included seven members, however in the intervening months, several members have left the commission, leaving the body with four members, the minimum number required for a quorum. The process of finding replacement members, especially those meeting the professional standards required for two members, has been difficult. As noted in the training and through experience, it may be prudent to reduce the number of members to five. With regard to finding two professional members, it appears that one member may suffice at this time, because city staff has made a good faith effort to locate a second professional member. 3. The necessity of the City Council approving each individual property nominated to the Historic Registry. Through discussion, the Historic Preservation Commission members felt that this may create an unnecessary burden to the Council for individual nominations. However any potential historic districts should be ultimately approved by the Council because under the standards of the historic preservation code, districts may be created without unanimous owner consent. Staff has made draft changes to the Historic Preservation code (OHMC 18.50) reflecting the topics listed above. Staff invites the Council to review the proposed changes and discuss, with a draft ordinance returning to the Council at a future meeting for adoption.

ATTACHMENTS 1. Draft OHMC 18.50 revisions

September 25, 2019 Workshop Meeting Packet 2 Chapter 18.50 HISTORIC PRESERVATION Sections: 18.50.010 Purpose. 18.50.020 Short title. 18.50.030 Definitions. 18.50.040 City of Oak Harbor historic commission. 18.50.050 City of Oak Harbor register of historic places. 18.50.060 Review of changes to the city of Oak Harbor register of historic places properties. 18.50.070 Review and monitoring of properties for special property tax valuation. 18.50.010 Purpose. The purpose of this chapter is to provide for the identification, evaluation, designation, and protection of designated historic and prehistoric resources within the boundaries of the city of Oak Harbor (hereinafter city) and preserve and rehabilitate eligible historic properties within the city for future generations through special valuation, a property tax incentive as provided in Chapter 84.26RCW, in order to: (1) Safeguard the heritage of the city as represented by those buildings, districts, objects, sites and structures which reflect significant elements of the city’s history; (2) Foster civic and neighborhood pride in the beauty and accomplishments of the past, and a sense of identity based on the city’s history; (3) Stabilize or improve the aesthetic and economic vitality and values of such sites, improvements and objects; (4) Assist, encourage and provide incentives to private owners for preservation, restoration, redevelopment and use of outstanding historic buildings, districts, objects, sites and structures; (5) Promote and facilitate the early identification and resolution of conflicts between preservation of historic resources and alternative land uses; and (6) Conserve valuable material and energy resources by ongoing use and maintenance of the existing built environment. (Ord. 1822§ 1, 2018). 18.50.020 Short title. This chapter shall be known as the “historic preservation ordinance.” (Ord. 1822 § 1, 2018). 18.50.030 Definitions. The following words and terms when used in this chapter shall mean as follows, unless a different meaning clearly appears from the context: (1) “City of Oak Harbor historic inventory” or “inventory” means the comprehensive inventory of historic and prehistoric resources within the boundaries of the city of Oak Harbor. (2) “City of Oak Harbor historic preservation commission” or “commission” means the commission created by OHMC 18.50.040. (3) “City of Oak Harbor register of historic places,” “local register,” or “register” means the listing of locally designated properties provided for in OHMC 18.50.050. (4) “Actual cost of rehabilitation” means costs incurred within 24 months prior to the date of application and directly resulting from one or more of the following: (a) Improvements to an existing building located on or within the perimeters of the original structure; or (b) Improvements outside of but directly attached to the original structure which are necessary to make the building fully usable but shall not include rentable/habitable floor space attributable to new construction; or (c) Architectural and engineering services attributable to the design of the improvements; or (d) All costs defined as “qualified rehabilitation expenditures” for purposes of the federal historic preservation investment tax credit. (5) A “building” is a structure constructed by human beings. This includes both residential and nonresidential buildings, main and accessory buildings. (6) “Certificate of appropriateness” means the document indicating that the commission has reviewed the proposed changes to a local register property or within a local register historic district and certified the changes as not adversely affecting the historic characteristics of the property which contribute to its designation. (7) “Certified local government” or “CLG” means the designation reflecting that the local government has been jointly certified by the State Historic Preservation Officer and the National Park Service as having established its own historic preservation commission and a program meeting federal and state standards. (8) “Class of properties eligible to apply for special valuation in the city of Oak Harbor” means all properties listed on the National Register of Historic Places or certified as contributing to a National Register Historic District which have been substantially rehabilitated at a cost and within a time period which meets the

September 25, 2019 Workshop Meeting Packet 3 requirements set forth in Chapter 84.26 RCW, until the city becomes a certified local government (CLG). Once a CLG, the class of properties eligible to apply for special valuation in the city of Oak Harbor means only properties listed on the city of Oak Harbor register of historic places or properties certified as contributing to the city of Oak Harbor register historic district which have been substantially rehabilitated at a cost and within a time period which meets the requirements set forth in Chapter 84.26 RCW. (9) “Cost” means the actual cost of rehabilitation, which cost shall be at least 25 percent of the assessed valuation of the historic property, exclusive of the assessed value attributable to the land, prior to rehabilitation. (10) A “district” is a geographically definable area, urban or rural, small or large, possessing a significant concentration, linkage, or continuity of sites, buildings, structures, and/or objects united by past events or aesthetically by plan or physical development. (11) “Emergency repair” means work necessary to prevent destruction or dilapidation to real property or structural appurtenances thereto immediately threatened or damaged by fire, flood, earthquake or other disaster. (12) “Historic property” means real property together with improvements thereon, except property listed in a register primarily for objects buried below ground, which is listed in a local register of a certified local government or the National Register of Historic Places. (13) “Incentives” are such rights or privileges or combination thereof which the Oak Harbor city council, or other local, state, or federal public body or agency, by virtue of applicable present or future legislation, may be authorized to grant or obtain for the owner(s) of register properties. Examples of economic incentives include, but are not limited to, tax relief, conditional use permits, rezoning, street vacation, planned unit development, transfer of development rights, facade easements, gifts, preferential leasing policies, beneficial placement of public improvements or amenities, or the like. (14) “Local review board” or “board,” used in Chapter 84.26 RCW and Chapter 254-20 WAC for the special valuation of historic properties, means the commission created in OHMC 18.50.040. (15) “National Register of Historic Places” means the national listing of properties significant to our cultural history because of their documented importance to our history, architectural history, engineering, or cultural heritage. (16) An “object” is a thing of functional, aesthetic, cultural, historical, or scientific value that may be, by nature or design, movable yet related to a specific setting or environment. (17) “Ordinary repair and maintenance” means work for which a permit issued by the city is not required by law, and where the purpose and effect of such work are to correct any deterioration or decay of or damage to the real property or structure appurtenance therein and to restore the same, as nearly as may be practicable, to the condition prior to the occurrence of such deterioration, decay, or damage. (18) “Owner” of property is the fee simple owner of record as exists on the Island County assessor’s records. (19) “Significance” or “significant” used in the context of historic significance means the following: a property with local, state, or national significance is one which helps in the understanding of the history or prehistory of the local area, state, or nation (whichever is applicable) by illuminating the local, statewide, or nationwide impact of the events or persons associated with the property, or its architectural type or style in information potential. The local area can include the city of Oak Harbor, Island County, or northwest Washington, or a modest geographic or cultural area, such as a neighborhood. Local significance may apply to a property that illustrates a theme that is important to one or more localities; state significance to a theme important to the history of the state; and national significance to property of exceptional value in representing or illustrating an important theme in the history of the nation. (20) A “site” is a place where a significant event or pattern of events occurred. It may be the location of prehistoric or historic occupation or activities that may be marked by physical remains; or it may be the symbolic focus of a significant event or pattern of events that may not have been actively occupied. A site may be the location of ruined or now non-extant building or structure if the location itself possesses historic cultural or archaeological significance. (21) “Special valuation for historic properties” or “special valuation” means the local option program which when implemented makes available to property owners a special tax valuation for rehabilitation of historic properties under which the assessed value of an eligible historic property is determined at a rate that excludes, for up to 10 years, the actual cost of the rehabilitation (Chapter 84.26RCW). (22) “State Register of Historic Places” means the state listing of properties significant to the community, state, or nation but which may or may not meet the criteria of the National Register. (23) A “structure” is a work made up of interdependent and interrelated parts in a definite pattern of organization. Generally constructed by man, it is often an engineering project. (24) “Universal Transverse Mercator” or “UTM” means the grid zone in metric measurement providing for an exact point of numerical reference.

September 25, 2019 Workshop Meeting Packet 4 (25) “Waiver of a certificate of appropriateness” or “waiver” means the document indicating that the commission has reviewed the proposed whole or partial demolition of a local register property or in a local register historic district and, failing to find alternatives to demolition, has issued a waiver of a certificate of appropriateness which allows the building or zoning official to issue a permit for demolition. (26) “Washington State Advisory Council’s Standards for the Rehabilitation and Maintenance of Historic Properties” or “State Advisory Council’s Standards” means the rehabilitation and maintenance standards used by the city of Oak Harbor historic preservation commission as minimum requirements for determining whether or not a historic property is eligible for special valuation and whether or not the property continues to be eligible for special valuation once it has been so classified. (Ord. 1822 § 1, 2018). 18.50.040 City of Oak Harbor historic commission. (1) Creation and Size. There is hereby established a city of Oak Harbor historic preservation commission, consisting of five seven members, as provided in subsection (2) of this section. Members of the city of Oak Harbor (hereinafter city) historic preservation commission shall be appointed by the mayor and approved by the city council and shall be residents of the city of Oak Harbor, except as provided in subsection (2)(b) of this section. (2) Composition of the Commission. (a) All members of the commission must have a demonstrated interest and competence in historic preservation and the ability to provide impartial decisions. (b) The commission shall always include at least two professionals who have experience in identifying, evaluating, and protecting historic resources and are selected from among the disciplines of architecture, history, architectural history, planning, prehistoric and historic archaeology, folklore, cultural anthropology, curation, conservation, and landscape architecture, or related disciplines. The commission action that would otherwise be valid shall not be rendered invalid by the temporary vacancy of one or all of the professional positions, unless the commission action is related to meeting certified local government (CLG) responsibilities cited in the certification agreement between the mayor and the State Historic Preservation Officer on behalf of the state. Furthermore, exception to the residency requirement of commission members may be granted by the mayor and city council in order to obtain representatives from these disciplines. (c) In making appointments, the mayor may consider names submitted from any source, but the mayor shall notify city of Oak Harbor and Island County history-related organizations of vacancies so that names of interested and qualified individuals may be submitted by such organizations for consideration along with names from any other source. (3) Terms. The original appointment of members to the commission shall be as follows: one three members shall serve for two years, two members shall serve for three years; and two members shall serve for four years. Thereafter, appointments shall be made for a three-year term. Vacancies shall be filled by the mayor for the unexpired term in the same manner as the original appointment. (4) Powers and Duties. The major responsibility of the city of Oak Harbor historic preservation commission is to identify and actively encourage the conservation of the city historic resources by initiating and maintaining a register of historic places and reviewing proposed changes to register properties; to raise community awareness of the city’s history and historic resources; and to serve as the city’s primary resource in matters of history, historic planning, and preservation. In carrying out these responsibilities, the city of Oak Harbor historic preservation commission shall engage in the following: (a) Conduct and maintain a comprehensive inventory of historic resources within the boundaries of the city and known as the city of Oak Harbor historic inventory, and publicize and periodically update inventory results. Properties listed on the inventory shall be recorded on the official zoning map with an “HI” (for historic inventory designation). This designation shall not change or modify the underlying zone classification. (b) Initiate and maintain the city of Oak Harbor register of historic places. This official register shall be compiled of buildings, structures, sites, objects, and districts identified by the commission as having historic significance worthy of recognition and protection by the city and encouragement of efforts by owners to maintain, rehabilitate, and preserve properties. (c) Review nominations to the city of Oak Harbor register of historic places according to criteria in OHMC 18.50.050(1) and adopt standards in its rules to be used to guide this review. (d) Review proposals to construct, change, alter, modify, remodel, move, demolish, or significantly affect properties or districts on the register as provided in OHMC 18.50.050(1); and adopt standards in its rules to be used to guide this review and the issuance of a certificate of appropriateness or waiver.

September 25, 2019 Workshop Meeting Packet 5 (e) Provide for the review either by the commission or staff of all applications for approvals, permits, environmental assessments or impact statements, and other similar documents pertaining to identified historic resources or adjacent properties. (f) Conduct all commission meetings in compliance with Chapter 42.30 RCW, Open Public Meetings Act, to provide for adequate public participation, and adopt standards in its rules to guide this action. (g) Participate in, promote and conduct public information, educational and interpretive programs pertaining to historic and prehistoric resources. (h) Establish liaison support, communication and cooperation with federal, state, and other local government entities which will further historic preservation objectives, including public education, within Whidbey Island. (i) Review and comment to the city council on land use, housing and redevelopment, municipal improvement and other types of planning and programs undertaken by any agency of the city, other neighboring communities, Island County, or the state or federal governments, as they relate to historic resources of the city. (j) Advise the city council and the mayor generally on matters of city history and historic preservation. (k) Provide information to the public on methods of maintaining and rehabilitating historic properties. This may take the form of pamphlets, newsletters, workshops, or similar activities. (l) Officially recognize excellence in the rehabilitation of historic buildings, structures, sites and districts, and new construction in historic areas; and encourage appropriate measures for such recognition. (m) Be informed about and provide information to the public and city departments on incentives for preservation of historic resources, including legislation, regulations and codes which encourage the use and adaptive reuse of historic properties. (n) Review nominations to the State and National Registers of Historic Places. (o) Investigate and report to the city council on the use of various federal, state, local or private funding sources available to promote historic resource preservation in the city. (p) Serve as the local review board for special valuation and: (i) Make determinations concerning the eligibility of historic properties for special valuation; (ii) Verify that the improvements are consistent with the Washington State Advisory Council’s Standards for Rehabilitation and Maintenance; (iii) Enter into agreements with property owners for the duration of the special valuation period as required under WAC 254-20-070(2); (iv) Approve or deny applications for special valuation; (v) Monitor the property for continued compliance with the agreement and statutory eligibility requirements during the 10-year special valuation period; and (vi) Adopt bylaws and/or administrative rules and comply with all other local review board responsibilities identified in Chapter 84.26 RCW. (q) The Commission shall adopt rules of procedure to address items in subsections (4)(c), (d), (f), and (p) of this section inclusive. (5) Compensation. All members shall serve without compensation. (6) Rules and Officers. The commission shall establish and adopt its own rules of procedure, and shall select from among its membership a chairperson and such other officers as may be necessary to conduct the commission’s business. (7) Staff Assistance. Professional staff assistance shall be provided by department of development services with additional assistance and information provided by other city departments as may be necessary to aid the commission in carrying out its duties and responsibilities under this chapter. (Ord. 1822 § 1, 2018). 18.50.050 City of Oak Harbor register of historic places. (1) Criteria for Determining Designation in the Register. Any building, structure, site, object, or district may be designated for inclusion in the city of Oak Harbor register of historic places if it is significantly associated with the history, architecture, archaeology, engineering, or cultural heritage of the community; if it has integrity; is at least 50 years old, or is of lesser age and has exceptional importance; and if it falls into at least one of the following categories: (a) Is associated with events that have made a significant contribution to the broad patterns of national, state, or local history. (b) Embodies the distinctive architectural characteristics of a type, period, style, or method of design or construction, or represents a significant and distinguishable entity whose components may lack individual distinction. (c) Is an outstanding work of a designer, builder, or architect who has made a substantial contribution to the art.

September 25, 2019 Workshop Meeting Packet 6 (d) Exemplifies or reflects special elements of the city’s cultural, special, economic, political, aesthetic, engineering, or architectural history. (e) Is associated with the lives of persons significant in national, state, or local history. (f) Has yielded or may be likely to yield important archaeological information related to history or prehistory. (g) Is a building or structure removed from its original location but which is significant primarily for architectural value, or which is the only surviving structure significantly associated with a historic person or event. (h) Is a birthplace or grave of a historical figure of outstanding importance and is the only surviving structure or site associated with that person. (i) Is a cemetery which derives its primary significance from age, from distinctive design features, or from association with historic events or cultural patterns. (j) Is a reconstructed building that has been executed in a historically accurate manner on the original site. (k) Is a creative and unique example of folk architecture and design created by persons not formally trained in the architectural or design professions, and which does not fit into formal architectural or historical categories. (l) If a building is listed in the National Register of Historic Places, it is immediately listed on the city of Oak Harbor register of historic places. (2) Process for Designating Properties or Districts to the Oak Harbor Register of Historic Places. (a) Any person may nominate a building, structure, site, object, or district for inclusion in the Oak Harbor register of historic places with the consent of the property owner. Members of the city of Oak Harbor historic preservation commission or the commission as a whole may generate nominations. In its designation decision, the commission shall consider the city of Oak Harbor historic inventory and the city of Oak Harbor comprehensive plan. (b) In the case of individual properties, the designation shall include the UTM reference and all features – interior and exterior – and outbuildings that contribute to its designation. (c) In the case of districts, the designation shall include description of the boundaries of the district; the characteristics of the district justifying its designation; and a list of all properties, including features, structures, sites, and objects, contributing to the designation of the district. (d) The city of Oak Harbor historic preservation commission shall consider the merits of the nomination, according to the criteria in subsection (1) of this section and according to the nomination review standards established in rules, at a public meeting. Adequate notice will be given to the public, the owner(s) and the authors of the nomination, if different, and lessees, if any, of the subject property prior to the public meeting, according to standards for public meetings established in rules and in compliance with Chapter 42.30 RCW, Open Public Meetings Act. Such notice shall include publication in a newspaper of general circulation in the city of Oak Harbor, and any other form of notification deemed appropriate by the city. If the commission finds that the nominated property is eligible for the city of Oak Harbor register of historic places, the commission shall make a recommendation to the city council that the property be listed the property in the register with the owner’s consent. In the case of historic districts, the commission shall if the commission finds that the nominated properties are eligible for the City of Oak Harbor register of historic places, the commission shall make a recommendation to the city council that the properties be listed in the register with a simple majority of property owners to be adequate for owner consent. Owner consent and notification procedures in the case of districts shall be further defined in rules. The public, property owner(s) and the authors of the nomination, if different, and lessees, if any, shall be notified of the listing. (e) Properties listed on the city of Oak Harbor register of historic places shall be recorded on official zoning records with an “HR” (for historic register) designation. Prior to receiving an HR designation, the property owner will be briefed on what attributes contributed to the designation of the building and how the designation affects building modifications. This designation shall not change or modify the underlying zone classification. (3) Removal of Properties from the Register. (a) In the event that any property is no longer deemed appropriate for designation to the city of Oak Harbor register of historic places, the commission may initiate removal from such designation by the same procedure as provided for establishing the designation, subsection (2) of this section. However, a property may be removed from the city of Oak Harbor register of historic places without the owner’s consent. (b) Additionally, and except to the extent that a property is subject to a historic preservation special valuation agreement entered into under the authority of this chapter and applicable state law, the

September 25, 2019 Workshop Meeting Packet 7 property owner(s) of record (as indicated by the records of the Island County auditor) of a property listed on the city of Oak Harbor register of historic places may make a written request to have said property removed from the register. The written request must be signed by said property owner(s) and notarized. Upon receipt of such a properly notarized written request, the commission shall immediately remove the property from the register. (4) Effects of Listing on the Register. (a) Listing on the city of Oak Harbor register of historic places is a designation denoting significant association with the historic, archaeological, engineering, or cultural heritage of the community. Properties are listed individually or as contributing properties to a historic district. (b) Prior to the commencement of any work on a register property, excluding ordinary repair and maintenance and emergency measures defined in OHMC 18.50.030(11), the owner must request and receive a certificate of appropriateness from the commission for the proposed work. Violation of this rule shall be grounds for the commission to review the property for removal from the register. (c) Prior to whole or partial demolition of a register property, the owner must request and receive a waiver of a certificate of appropriateness. (d) Once the city is certified as a certified local government (CLG), all properties listed on the city of Oak Harbor register of historic places may be eligible for special tax valuation on their rehabilitation (OHMC 18.50.070). (Ord. 1822 § 1, 2018). 18.50.060 Review of changes to the city of Oak Harbor register of historic places properties. (1) Review Required. No person shall change the use, construct any new building or structure, or reconstruct, alter, restore, remodel, repair, move, or demolish any existing property on the city of Oak Harbor register of historic places or within a historic district on the city of Oak Harbor register without review by the commission and without receipt of a certificate of appropriateness, or, in the case of demolition, a waiver, as a result of the review. The review shall apply to all features of the property, interior and exterior, that contribute to its designation and are listed on the nomination form. Information required by the commission to review the proposed changes is established in rules. (2) Exemptions. The following activities do not require a certificate of appropriateness or review by the commission: ordinary repair and maintenance, which includes painting, or emergency measures defined in OHMC 18.50.030(11). (3) Review Process. (a) Requests for Review and Issuance of a Certificate of Appropriateness or Waiver. The director shall report any application for a permit to work on a designated city of Oak Harbor register of historic places property or in a city of Oak Harbor historic district to the commission. If the activity is not exempt from review, the commission or professional staff shall notify the applicant of the review requirements. The building or zoning official shall not issue any such permit until a certificate of appropriateness or a waiver is received from the commission but shall work with the commission in considering building and fire code requirements. (b) Commission Review. To achieve the comprehensive plan and historic preservation goals and to safeguard the heritage of Oak Harbor, a two-part evaluation system shall be followed: (i) The identification of those materials, features, and combinations of features that give significance to property(ies) or districts on the Oak Harbor register of historic places. (ii) Assessing the potential impact or effect of rehabilitation work necessary for efficient contemporary utilization of the property. The historic character of a property or district is defined by many features: materials, style, method of construction, composition and decorative feature the presence of architectural metals, window number, arrangement and styles (fenestration), entrances and porches, storefronts on commercial buildings, internal arrangements and detailing, and the historic relationship between buildings, landscape features and open space, as well as many other materials and features, can all contribute to a property’s character. After identifying distinguishing historic characteristics of the property subject to the design review process, retention and preservation of those features and materials are the primary goals of the design review effort. This is accomplished through the review process individually for each property. Preferred approaches to the treatment of the properties by the Secretary of the Interior are common to each property. These are, in descending order of preference: (A) protecting and maintaining, (B) repairing, (C) replacing in kind, (D)

September 25, 2019 Workshop Meeting Packet 8 design for missing features, and (E) alterations and additions to historic buildings. The guidelines for the above are listed in the “rules and procedures” adopted herewith. WAC 254-20-100 provides guidance for the rehabilitation and maintenance of historic properties. The WAC states that the following review standards shall be used by local review boards as minimum requirements for determining whether or not a historic property is eligible for special valuation and whether or not the property continues to be eligible for special valuation once it has been so classified: (iii) Rehabilitation. (A) Every reasonable effort shall be made to provide a compatible use for a historic property which requires minimal alterations of the building, structure, or site and its environment, or to use a historic property for its originally intended purpose. (B) The distinguishing original qualities or character of the building, structure, or site and its environment shall not be destroyed. The removal or alteration of any historic material or distinctive architectural features should be avoided when possible. (C) All buildings, structures, and sites shall be recognized as products of their own time. Alterations that have no historic basis and which seek to create an earlier appearance shall be discouraged. (D) Changes which may have taken place in the course of time are evidence of the history and development of the building, structure, or site and its environment. These changes may have acquired significance in their own right and this significance shall be recognized and respected. (E) Distinctive stylistic features or examples of skilled craftsmanship which characterize a building, structure, or site shall be treated with sensitivity. (F) Deteriorated architectural features shall be repaired rather than replaced, whenever possible. In the event that replacement is necessary, the new material should match the material being replaced in composition, design, color, texture, and other visual qualities. Repair or replacement of missing architectural features should be based on accurate duplication of features substantiated by historic, physical, or pictorial evidence rather than on conjectural designs or the availability of different architectural elements from other buildings or structures. (G) The surface cleaning of structures shall be undertaken with the gentlest means possible. Sandblasting and other cleaning methods that will damage the historic building material shall not be undertaken. (H) Every reasonable effort shall be made to protect and preserve archaeological resources affected by, or adjacent to, any project. (I) Wherever possible, new additions or alterations to structures shall be done in such a manner that if such additions or alterations were to be removed in the future, the essential form and integrity of the structure would be unimpaired. (iv) Maintenance. (A) Buildings and structures shall not be allowed to deteriorate beyond the point where routine maintenance and repair will return them to good condition. (B) Buildings shall be kept in a safe and habitable condition at all times. Structural defects and hazards shall be corrected. Any condition which constitutes a fire hazard shall be eliminated. (C) Buildings shall be protected from ongoing water damage due to defective roofing, flashing, glazing, caulking, and other causes. Moisture condensation resulting from inadequate heat or ventilation shall be eliminated if present at levels sufficient to promote rot or decay of building materials. (D) Deteriorated exterior architectural features and any broken or missing doors and windows shall be repaired or replaced. (E) Painted exterior surfaces shall be maintained and repainted as necessary to prevent a deteriorated appearance or damage to the substrate. Exterior masonry surfaces shall be tuck pointed where required to maintain the mortar in sound condition. Finished tuck pointing shall match the original mortar joints in hardness and appearance. (c) Demolition. A waiver of the certificate of appropriateness is required before a permit may be issued to allow whole or partial demolition of a designated city of Oak Harbor register of historic places property or in a city of Oak Harbor historic district. The owner or his/her agent shall apply to the commission for a review of the proposed demolition and request a waiver. The applicant shall meet with the commission in an attempt to find alternatives to demolition. These negotiations may last no longer than 45 calendar days from the initial meeting of the commission, unless either party requests an extension. If no request

September 25, 2019 Workshop Meeting Packet 9 for an extension is made and no alternative to demolition has been agreed to, the commission shall act and advise the official in charge of issuing a demolition permit of the approval or denial of the waiver of a certificate of appropriateness. Conditions in the case of granting a demolition permit may include allowing the commission up to 45 additional calendar days to develop alternatives to demolition. Any conditions agreed to by the applicant in this review process shall become conditions of approval of the permits granted. After the property is demolished, the commission shall initiate removal of the property from the register. (d) Appeal of Approval or Denial of a Waiver of a Certificate of Appropriateness. The commission’s decision regarding a waiver of a certificate of appropriateness may be appealed to the city council within 30 days. The appeal must state the grounds upon which the appeal is based. The appeal shall be reviewed by the city council only on the records of the commission. Appeal of city council’s decision regarding a waiver of a certificate of appropriateness may be appealed to Island County Superior Court. (Ord. 1822 § 1, 2018). 18.50.070 Review and monitoring of properties for special property tax valuation. (1) Timelines. (a) Applications are forwarded to the commission by the assessor within 10 calendar days of filing. (b) Applications shall be reviewed by the commission before December 31st of the calendar year in which the application is made. (c) Commission decisions regarding the applications shall be certified in writing and filed with the assessor within 10 calendar days of issuance. (2) Procedure. (a) The assessor forwards the application(s) to the commission. (b) The commission reviews the application(s), consistent with its rules of procedure, and determines if the application(s) are complete and if the properties meet the criteria set forth in WAC 254-20-070(1) and listed in OHMC 18.50.050(1). (i) If the commission finds the properties meet all the criteria, then, on behalf of the city, it enters into a historic preservation special valuation agreement (set forth in WAC 254-20-120 and in subsection (4) of this section) with the owner. Upon execution of the agreement between the owner and commission, the commission approves the application(s). (ii) If the commission determines the properties do not meet all the criteria, then it shall deny the application(s). (c) The commission certifies its decisions in writing and states the facts upon which the approvals or denials are based and files copies of the certifications with the assessor. (d) For approved applications the commission: (i) Forwards copies of the agreements, applications, and supporting documentation (as required by WAC 254-20-090(4) and identified in subsection (3)(b) of this section) to the assessor; (ii) Notifies the state review board that the properties have been approved for special valuation; and (iii) Monitors the properties for continued compliance with the agreements throughout the 10-year special valuation period. (e) The commission determines, in a manner consistent with its rules of procedure, whether or not properties are disqualified from special valuation either because of: (i) The owner’s failure to comply with the terms of the agreement; or (ii) Because of a loss of historic value resulting from physical changes to the building or site. (f) For disqualified properties, in the event that the commission concludes that a property is no longer qualified for special valuation, the commission shall notify the owner, assessor, and state review board in writing and state the facts supporting its findings. (3) Criteria. (a) Historic Property Criteria. The class of historic property eligible to apply for special valuation in the city of Oak Harbor means all properties listed on the National Register of Historic Places or certified as contributing to a National Register Historic District which have been substantially rehabilitated at a cost and within a time period which meets the requirements set forth in Chapter 84.26 RCW, until the city becomes a certified local government (CLG). Once a CLG, the class of property eligible to apply for special valuation in the city of Oak Harbor means all properties listed on the city of Oak Harbor register of historic places and National Register of Historic Places or properties certified as contributing to a city of Oak Harbor or National Register historic district which have been substantially rehabilitated at a cost and within a time period which meets the requirements set forth in Chapter 84.26 RCW. (b) Application Criteria. Complete applications shall consist of the following documentation: (i) A legal description of the historic property;

September 25, 2019 Workshop Meeting Packet 10 (ii) Comprehensive exterior and interior photographs of the historic property before and after rehabilitation; (iii) Architectural plans or other legible drawings depicting the completed rehabilitation work; (iv) A notarized affidavit attesting to the actual cost of the rehabilitation work completed prior to the date of application and the period of time during which the work was performed, and documentation of both to be made available to the commission upon request; and (v) For properties located within historic districts, in addition to the standard application documentation, a statement from the Secretary of the Interior or appropriate local official, as specified in local administrative rules or by the local government, indicating the property is a certified historic structure is required. (c) Property Review Criteria. In its review the commission shall determine if the properties meet all the following criteria: (i) The property is historic property; (ii) The property is included within a class of historic property determined eligible for special valuation by the city under subsection (3)(a) of this section; (iii) The property has been rehabilitated at a cost which meets the definition set forth in RCW 84.26.020(2) (and identified in this section) within 24 months prior to the date of application; and (iv) The property has not been altered in any way which adversely affects those elements which qualify it as historically significant as determined by applying the Washington State Advisory Council’s Standards for the Rehabilitation and Maintenance of Historic Properties (WAC 254-20- 100(1) and listed in OHMC 18.50.050(1)). (d) Rehabilitation and Maintenance Criteria. The Washington State Advisory Council’s Standards for the Rehabilitation and Maintenance of Historic Properties in WAC 254-20-100 shall be used by the commission as minimum requirements for determining whether or not a historic property is eligible for special valuation and whether or not the property continues to be eligible for special valuation once it has been so classified. (4) Agreement. The historic preservation special valuation agreement in WAC 254-20-120 shall be used by the commission as the minimum agreement necessary to comply with the requirements of RCW 84.26.050(2). (5) Appeals. Any decision of the commission acting on any application for classification as historic property, eligible for special valuation, may be appealed to Island County Superior Court under RCW 34.05.510 through 34.05.598 in addition to any other remedy of law. Any decision on the disqualification of historic property eligible for special valuation, or any other dispute, may be appealed to the county board of equalization. (Ord. 1822 § 1, 2018).

September 25, 2019 Workshop Meeting Packet 11 Date: September 25, 2019 City of Oak Harbor Subject: Land Use Approvals and City Council Hearing Examiner Approval Workshop Agenda Bill Code Changes

FROM:Steve Powers, AICP, Director Development Services

SUMMARY STATEMENT The Oak Harbor Municipal Code provides different review processes for different types of project permits. The simplest permits (e.g. a building permit) are Type I reviews with an administrative (staff) decision. Type II reviews involve more complex permits (e.g. a site plan) and are also an administrative decision. Conditional use permits and variances are Type III reviews which require a public hearing before the Hearing Examiner who has final decision authority. Type IV permits (e.g. subdivision plats and certain site plans) require an open-record hearing before either the Planning Commission or Hearing Examiner, with the Council making the decision after a closed record review. Many communities have transitioned the Type IV-like permits to their hearing examiner, where he/she conducts the public hearing and renders the final decision. Staff will brief the City Council on this model, with the intent of determining if the Council would like to convert Oak Harbor to this system.

ATTACHMENTS None.

September 25, 2019 Workshop Meeting Packet 12 City of Oak Harbor Date: September 25, 2019 City Council Subject: Design Guidelines Workshop Agenda Bill

FROM:Steve Powers, AICP, Director Development Services

SUMMARY STATEMENT The Oak Harbor Main Street Association submitted a draft design guideline they wish to see incorporated into the City’s design review process. The proposed document included a number of ideas for strategies, implementation, land uses, urban amenities, and other details. The City of Oak Harbor has had the current Design Regulations and Guidelines document adopted as policy for review of projects within the city since April 2006. The document discusses various aspects of land development, including site planning, landscaping, parking, and building design. Detailed in the document is development criteria for specific land uses including commercial, industrial and multi-family residential, as well as specific criteria for areas within the city, including what is known in the DRG as the “Harborside” area, a name for the Central Business District that was assigned during the process of adoption of the Windjammer Park plan. As noted during previous presentations to the Planning Commission, staff review determined that a significant amount of overlap between the DRG and the Main Street documents existed. Much of this duplicated material existed in other sections of the DRG than the specific “Harborside” chapter, which may lead to confusion and the impression that the Central Business District is under-served in the overall DRG document. While the presentation of the criteria differs between the proposed Main Street document and the existing DRG, staff feels that both express ideas that are typical for modern design criteria. What differs between the two documents is the level of detail. While the Main Street document specifically addresses development within the Central Business District, the DRG addresses the entire city. Therefore, after presentation and discussion with the Planning Commission and meeting with the Executive Director of the Main Street Association, staff drafted a revised version of the Design Regulations and Guidelines that features a more detailed version of the specific guidelines for the downtown area, renamed “Old Town” to reflect the modern version of the neighborhood name developed for the 2016 Oak Harbor Comprehensive Plan.

ATTACHMENTS 1. Existing DRG Document in its entirety for context 2. Draft Old Town section of the DRG

September 25, 2019 Workshop Meeting Packet 13

Design Regulations 2006 Update & Guidelines

What’s Inside

• Requirements for site layout, Why? When? How? architecture, and landscaping. These regulations are The requirements described Not all sections of this book- intended to direct the look in this booklet apply to all let may apply to your pro- • Design requirements and function of new develop- new construction of commer- ject. for special uses ment to meet the commu- cial, industrial, public facil- and/or areas such as nity’s goals defined in the ity, and multi-family residen- There are sections that only the Midway Blvd and Comprehensive Plan. tial uses. apply to specific uses or loca- SR-20 corridors. tions. These goals describe design They also apply to exterior • Examples of designs that is human scaled, people remodels whose value is 60% When doing your design, that work well. oriented, neighborhood or greater of the value of the check to see which sections apply to your project, and appropriate, builds on our existing structures community’s history and make sure you have met the addresses the street and requirements. public areas. When you submit your appli- The Design Regulations and cation(s) to the City make Sections Guidelines define required sure your drawings clearly show how your project meets 1) Site Plan site and building components while promoting creative the requirements. 2) Car Oriented solutions. If you have any questions Commercial contact City staff for assis- 3) Neighborhood tance. Context

4) Multi-Family Residential Design

5) Landscaping 6) Variances QUESTIONS? CITY OF OAK HARBOR

360-279-4500 865 SE Barrington Drive [email protected]

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 14

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 2 1) Site Plan Section Items Purpose i) Buildings These requirements direct the ii) Streets design of commercial, industrial, and public facility sites iii) People to ensure that development in our city meets the long term iv) Cars goals and community’s vision v) Utilities described in the Comprehen- sive Plan. The basic principles of good site planning can be remembered with the acronym SAFE:

S—safe A—attractive F—fits the neighborhood E—efficient and useable

Achieving this involves attention to how sites, buildings, open spaces, and streets work together to create a positive sense of place.

The location of buildings, parking, landscaping, utilities, and service areas all affect the safety and enjoy- ment of the community and these design regulations address overall aesthetics, views from and to the site, site features, and screening negative aspects.

Remember ! There are requirements for specific locations, multi-family residential, and car oriented uses that must be checked when designing a site.

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 15

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 3 1) Site Plan

i. Buildings

1) Streets shall be lined with retail or office space, living units, or landscaping, rather than parking lots, garages, or blank walls.

2) Orient buildings, entrances, windows and activity to face the street.

3) Maximize the length of the building at the street front.

4) Buildings shall be placed at the front setback line.

5) Corner lots of all intersecting pairs building located at front setback of arterials shall define frontages building façade is maximized along sidewalk with buildings or street defining parking in rear landscaping features on both access to neighbors is provided streets. At least one frontage shall be defined by building.

6) Buildings shall incorporate materials and details that are fitting with the Pacific north west region and are appropriate for the community’s existing design characteristics and the goals stated in the Comprehensive Plan.

7) Developments shall not be designed as barriers that separate neighborhoods or districts, especially for pedestrians.

8) Building entrances, walkways, and facades shall be designed to relate to neighboring buildings to establish a coherent development pattern that is people oriented.

9) Locate main entrances and display building located at both frontage setbacks windows near to, and facing the street defined by building and landscaping street with a direct walking route building entrance and façade face street from the sidewalk. access to neighbors is provided for cars and people

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 16

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 4 1) Site Plan

i. Buildings

10) Incorporate similar, or complimentary patterns from existing developments within the neighborhood or adjacent streets (such as eleva- tion, outline, window treatment, entrances, and roof lines).

11) Blank walls are not permitted; all walls must have visual interest.

12) Buildings should be designed for the city context and directed to the street not toward the neighbor or parking areas.

13) Window displays are required over entrance articulated with details the majority (min 75%) of the front well articulated façade façade (industrial uses may be architecture with a Pacific north west feel

granted administrative variances from this regulation).

14) Entrances shall be articulated and the main entrance shall be distinguishable from other entrances.

15) Separate entrances are required for residential uses in multiple use buildings.

16) All building facades facing or visible from the street or sidewalk shall be articulated. Vertical ar- ticulation shall be at each 10 ft or storey interval. Horizontal articu- lation shall be used to differentiate storefronts and/or provide visual interest.

17) No interval of a roof line shall be unbroken for greater than 100 ft building directed toward the street for sloped roofs or 50 ft. for flat articulated roof line roofs. weather protection provided at entrance

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 17

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 5 1) Site Plan

i. Buildings

18) Fully glazed facades are not permitted. Administrative variances for showrooms may granted if the building entrance(s) and other facades are significantly enhanced with elements that provide added interest, are human scaled, and fit the context of the surrounding neighborhood (this type of variance is not applicable for Harborside).

19) Buildings on corner lots shall provide: 1) special treatments of pedestrian weather protection at the corner of the building, 2) a architecture that addresses the corner corner architectural element (such mix of façade materials as bay windows, turret, roof deck, special pedestrian weather protection corner building entrance balconies, sculpture, etcetera), and 3) a corner entrance or a people space of at least 100 sq. ft.

20) Metal siding, concrete blocks, mirrored glass, or stucco shall be used in combination with other materials and should not be the predominant façade material.

Note! These requirements apply only to commercial, public facility, retail and industrial uses.

Remember! Check the Neighborhood Context section for other requirements that may building addresses the corner with architecture apply. people space provided at the corner including sculpture, benches and landscape planter

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 18

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 6 1) Site Plan

ii. Streets

1) Access roads are required through large lots or lots with both front and rear frontages . These roads shall include street trees and sidewalks and shall be generally aligned with the traditional street grid system. Multiple building developments shall address these roads in the same way as existing streets (in terms of landscaping, building placement and screening requirements). These roads should be designed to feel like city streets for people walking and driving down them, not like lanes through a parking lot.

2) Gaps in the street grid shall be completed by providing connecting streets. An administrative variance limiting these connections to only pedestrian and bicycle ways may be granted if a well designed proposal can be shown to be: 1) practicable, 2) allows for full pedestrian and bicycle access in both directions, 3) is generally aligned with the street grid, 4) is human scaled, 5) incorporates landscaping, and 6) meets all other design requirements.

development on large lots with front and rear street frontage requires through roads (where possible aligned with the existing street grid)

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 19

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 7 1) Site Plan

iii. People

1) Design the site to maximize safety and efficiency for walkers while minimizing conflicts with cars (including human scaled lighting, signage, and other appropriate elements). This shall be achieved by providing safe, separated and well delineated pedestrian walkways between the street, building entrances, parking areas, neighboring sites, transit stops and public walkways.

2) Locations for transit stops may be required on large sites over five acres. safe, well designed pedestrian connection 3) A minimum of four bicycle racks (includes lighting, landscaping, grade detailing) per building shall be provided at convenient locations on site.

4) If there is no room for a sidewalk in the right-of-way, it must be provided on site.

5) 200 s.q. ft. of people space per building is required. Large sites over five acres shall provide an additional 200 sq. ft. per acre. These shall be safe, well designed spaces which include seating, shade trees, human scaled lighting and trash receptacles at practical locations on site (Harborside sites are exempt from this requirement).

6) Weather protection is required at people space appropriately located next to the entrance entrances. and sidewalk details such as using landscaping to define the people space, and moveable chairs are well used here 7) Human scaled lighting at entrances and along the front facades of buildings is required and shall be shielded to eliminate glare and off site lighting.

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 20

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 8 1) Site Plan

iv. Cars

1) Each site shall have a single car entrance designated. Additional service entrance(s) may be permitted provided: 1) it is demonstrated to be a reasonable option due to site conditions or use, and 2) additional design features are used to enhance the site’s visual quality.

2) Where possible car access shall be provided from the side or minor frontage (this does not apply to sites along SR-20).

3) Separate car and pedestrian traffic pedestrian access designed to be completely with safe walkways. For safety, separated from, and not secondary to, car extra care in the design of car access access points and the crossing of light standards no taller than 20 feet sidewalks for pedestrian safety should be taken.

4) Clearly demark walkways, reduce car access to the smallest practical, and ensure that walkways are not secondary to car access.

5) Parking for cars or garage doors (for commercial sites) should not front the street as much as is practicable; as well, unenclosed parking areas shall not be located closer to the street than the front edge of the building, or between the building and the street.

6) Parking reductions may be granted for developments which include either of the following: parking structures, or direct access to transit facilities.

7) Parking lot lighting shall be single car entrance located off of secondary street pedestrian walkways well defined and separated from shielded from shining off site or car traffic producing glare and limited to no parking located no closer to the street than the front more than 20’ tall. edge of the building

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 21

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 9 1) Site Plan

v. Utilities

1) Stormwater ponds, swales, and other stormwater facilities shall be located at the rear of the lot and/ or within parking areas. These facilities shall be incorporated into the site as much as practicable and be landscaped for aesthetics and to provide screening. Administrative variances may be granted if: 1) it is demonstrated that there is no other reasonable option due to site conditions or topography, and 2) additional design features are used to enhance the visual quality of the site. natural stone used instead of concrete block stormwater facility is designed to look like a 2) Facilities shall be designed so that natural pond safety fences are not required. Administrative variances of this requirement must use 1) decorative open fencing and 2) enhanced landscaping.

3) Eco-block or other retaining walls for these facilities shall be screened, and/or have decorative finishes that appear natural or provide an aesthetic fit with the overall site design.

4) All service areas and trash enclosures shall be screened.

5) Trash enclosures may not be located closer to the street than the front of the building.

6) Provide locations to “set-out” dumpsters if the trash enclosure is stormwater facility designed so that safety not accessible for pickup by City fencing is not required equipment. facility is designed to fit into the overall landscape plan 7) Locate utility meters so that they are not visually prominent from the street.

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 22

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 10 2) Car Oriented Commercial Section Items Purpose i. Streetscape These standards have been ii. Display areas established for the design of sites with drive-through facili- iii. Canopies & bays ties and vehicle displays, to integrate operational elements, and site and building design. The following regulations assist these uses with making a positive contribution to the surrounding context, public streetscape and neighboring sites.

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 23

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 11 2) Car Oriented Commercial

i. Streetscape

1) Locate the main pedestrian entrance at the corner or the more major street front.

2) Stacking lanes or driveways shall not be located between the building and street, or within the setback area.

3) Integrate stacking lanes and driveways into the larger landscape and streetscape concept.

4) Drive-through, car wash, and service bays are not facing the main street frontage service bays should not face the main street frontage.

5) Multiple bays for drive-throughs, car washes, or service facilities must provide architectural or landscape features separating every three bays.

main pedestrian entrance facing street drive-through lanes not facing main street frontage

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 24

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 12 2) Car Oriented Commercial

ii. Display areas

1) Vehicle display lots shall meet the design and landscape requirements of parking lots relating to tree planting requirements.

2) Vehicle display lots must provide at least one walkway that connects street frontages, buildings and neighboring sites.

3) Vehicle display areas may be no closer to the street than the setback, and products may not be displayed in the setback areas.

4) 50% of the street frontage may be used for vehicle display areas.

5) Display areas along the street frontage may be raised up to a maximum of four feet above grade.

50% of frontage for vehicle display no display permitted closer to street than edge of building walkways provided as part of circulation plan trees provided as per parking lot requirements (may be clustered)

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 25

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 13 2) Car Oriented Commercial

iii. Canopies and bays

1) Drive-throughs, car washes and service bay structures shall be no taller than the roof line of the main building and should appear to be smaller than the main building (bays should appear as secondary to main building) and shall incorporate architectural elements of the main building.

2) Lighting under canopies shall be completely shielded from shining out from under the canopy.

3) The main street oriented façade shall not be dominated by the canopy looks like roof not platform lighting under canopy completely shielded drive-through canopy or bay canopy design matches building architecture component of the site.

4) Canopies shall look like roofs, not platforms.

5) On any portion of street frontage with a canopy, street trees shall be planted with 20 ft spacing.

any portion of street frontage with a canopy shall have street trees planted with 20 foot spacing

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 26

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 14 3) Neighborhood Context Section Items Purpose i. Harborside The character or context of ii. SR-20 an area is defined by such factors as its built environ- iii. Midway Blvd ment, natural features and open space, type of buildings, iv. Residential architectural style, and qual- neighborhoods ity of public facilities.

These regulations guide new development to maximize opportunities by completing fragmented street patterns, intensifying activities, and creating stronger linkages with surrounding neighborhoods and commercial areas. This will help ensure that new development will be compatible and complimentary to the existing character of the city while also following the goals and policy direction of the Comprehensive Plan.

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 27

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 15 3) Neighborhood Context

i. Harborside

1) All overlay district regulations are applicable.

2) Only one driveway access is permitted per site.

3) Parking is only permitted in the rear of buildings.

4) Buildings must be located on the street frontage property line.

5) Weather protection shall be provided along building frontages and shall be placed no more than 15 ft above the ground. building located at front setback weather protection along front façade 6) All awning and/or canopies must awning and canopies designed to compliment be designed to compliment the architectural characteristics of Harborside aesthetic and architectural characteristics of the Harborside neighborhood.

7) Back-lit awnings are prohibited.

8) Building entrances shall recessed into the building as per the historic context of the neighborhood.

9) Buildings shall respect the architectural heritage of the neighborhood with complimentary choices for materials, building scale, proportions and architectural details.

building entrances shall be recessed as per historic context of Harborside materials and architecture shall compliment existing context parking is only permitted in the rear of buildings

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 28

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 16 3) Neighborhood Context

ii. SR-20

1) All frontages along SR-20 must con- form to the Heritage Way landscape plan. This includes a required 20 foot landscape area with approved tree species planted every 30 feet.

2) Parking areas are not permitted in the Heritage Way landscape area. Walkways & people spaces are permitted in this area, provided the required number of street trees remain.

20 foot landscape setback along SR-20 only people spaces allowed in landscape setback

approved species of trees to be planted with 30 foot along SR-20 frontage

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 29

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 17 3) Neighborhood Context

iii. Midway Boulevard

1) Through streets aligned with the existing street grid shall be provided on sites fronting Midway Boulevard. An administrative variance limiting these connections to only pedestrian and bicycle ways may be granted if a well designed proposal can be shown to be: 1) practicable, 2) allows for full pedestrian and bicycle access in both directions, 3) is generally aligned with the street grid, 4) is human scaled, 5) incorporates landscaping, and 6) meets all other design requirements.

2) Through lots having two street frontages including one on Midway Blvd. shall provide complimentary landscaping and street improvements along the rear frontages, including: street trees planted with 25 ft spacing, 5 ft landscape strips, and walkways.

3) Reductions in parking requirements may be granted for providing shared driveways between sites.

through streets aligned with the existing street grid are provided complimentary street improvements along the rear

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 30

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 18 4) Multi-Family Residential Design Section Items Purpose i. Buildings The character of residential ii. People neighborhoods is important to the community; as is the iii. Cars tradition of providing a range of housing types and densi- ties.

These regulations are intended to ensure that multi-family housing: 1) suits the neighborhood it is located in, 2) helps define friendly and attractive new neighborhoods, 3) is designed to add to the visual character and quality of Oak Harbor’s neighborhood streets, and 4) is designed to meet the needs of residents.

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 31

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 19 4) Multi-Family Residential Design

i. Buildings

1) Street trees planted every 25 ft. are required along the frontages of all multi-family residential uses.

2) Street front facades must include windows and entrances visible from the street.

3) Blank walls are not permitted; all walls must have visual interest.

4) Buildings should be designed for the neighborhood context with views, windows, and entrances directed to the street not toward the neighbor or parking areas. windows and front doors face street architecture designed to fit into existing 5) The main entrance does not have neighborhood to face the street if it opens onto a porch, or courtyard that faces the street, and other major architectural details are used to draw attention to the entrance.

6) All ground level units shall have direct access to a minimum of 70 sq. ft. of private yard area. This area shall partially screened from neighboring units and uses.

7) All ground level units shall have either a separate entrance from the exterior, access from a central courtyard, or access from an interior lobby.

8) Buildings shall incorporate materials and details that are fitting with the Pacific north west region and are appropriate for the community’s existing design characteristics and the goals stated in the ground floor residences have private yard space Comprehensive Plan. accessible from the unit street trees are provided windows, and balconies are directed toward the

street

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 32

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 20 4) Multi-Family Residential Design

i. Buildings

9) Metal siding, concrete blocks, mirrored glass, or stucco shall be used in combination with other materials and should not be the predominant façade material.

10) Use building elements such as bay windows, dormers, roofs, trellises and support structures as features that provide smaller scale interest.

11) The existing architectural characteristics of buildings along neighboring streets shall be reflected in the design of new buildings by incorporating the fol- bay windows, dormers, roofs, balconies are used to provide smaller scale interest lowing into their design: similar roof pitches; similar window sizes and placement, similar type of entrance features such as porches where appropriate, similar architectural style and detailing and complementary landscaping.

12) Roofs should have consistent pitches and overhanging eves, demonstrating a common-sense recognition of the local climate by utilizing appropriate pitches, drainage and materials.

architectural features highlight the locations of main entrances garages are set back from the front edge of the facade

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 33

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 21 4) Multi-Family Residential Design

ii. People

1) In addition to side and rear yards, sites with over eight units must provide safe, well designed common people spaces which include seating, shade trees, and human scaled lighting in practical locations on site. 100 sq. ft. of common people space shall be provided per unit. (Harborside sites are exempt from this requirement). These spaces must be eas- ily visible and central to the site, with direct access to the street. common open space is designed to be practical, safe, centrally located and visible 2) Human scaled lighting is required throughout the site including entrances, and along walkways.

100 sq. ft. of common open space is provided per unit ground floor units each have a min of 70 sq. ft. of directly accessible private yard area

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 34

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 22 4) Multi-Family Residential Design

iii. Cars

1) The garage facing the street may not be more than 1/2 of the façade in length.

2) The garage wall facing the street must be no closer than the wall containing the main entrance (or to the edge of a covered porch or deck if provided).

3) If there is living space above the garage, and it has windows and/or a functional balcony facing the street, these provisions may be garage has living space with windows above so it can be closer to the street than the rest of the varied. building

4) Parking lot requirements apply to multi-family developments.

garage facing the street is no more than 1/2 the façade garages walls can be no closer to the street than the rest of the façade.

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 35

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 23 5) Landscaping Section Items Purpose i. Boundaries At its most basic, site land- ii. Screening scaping provides shade for people, visual interest and iii. Buffers beauty, and helps define the structure for the overall site iv. Parking Lots that architecture alone can v. Standards not accomplish.

These regulations are intended to improve the quality of the built environment by providing consistent streetscape landscaping, re- ducing the unsightliness of parking areas, adding to the overall aesthetics of developments and screening views of service areas or other less attractive elements.

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 36

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 24 5) Landscaping

i. Boundaries

1) A 5 ft. landscape boundary is required along the rear of lots.

2) 5 ft. side yard landscape boundaries are required from the rear property line to the rear edge of the building.

3) Landscaping and trees may be clustered to provide alternative equivalents to boundary requirements (trees and landscape area must remain the same).

4) The street frontage landscape setback shall be 20’ along SR-20, 10’ along arterials, and 8’ on all other trees planted with 25 foot intervals roads. ground cover and sod over 75% of area

5) Boundary and street frontage landscape strips shall be planted with the following, or equivalent group- ings: 1) trees at 25’ intervals , and 2) shrubs, ground covers, sod, or other landscape features to provide 75% cover at the time of planting.

6) Parking areas are not permitted in the landscape strips. People spaces may be included in the landscape strips provided the number of required trees remain.

side lot landscape boundaries end at the rear of buildings people spaces are encouraged for landscape setbacks, while parking and buildings are prohibited some trees are clustered to provide an alternative equivalent to requirements

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 37

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 25 5) Landscaping

ii. Screening

1) Vehicle storage, garages, mechanical equipment, trash dumpsters, product storage, and service areas are to be fully screened. Fencing may only be used in combination with plantings.

2) Landscape buffers may be required for these, or other uses with similar impacts if adjacent to residential zones.

trash containers hidden from view with sturdy and attractive enclosure

mechanical equipment attractively secured and screened with landscaping

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 38

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 26 5) Landscaping

iii. Parking lots

Parking lots have the potential to dominate a site, resulting in developments that are less attractive, diminish the streetscape and make the community less people oriented.

The following regulations define design parameters that reduce the negative impacts of parking areas while ensuring that they are useable, safe and attractive for the community and neighboring developments.

1) A full perimeter of hedging & trees is required where there are no walkways or buildings. The perimeter shall be a minimum of 5’ wide, have trees spaced every 20’. a perimeter of hedging and trees is required around parking lots 2) The hedging may include combinations of landscaping and decorative screening walls and shall be a minimum of 30” high with a maximum of 48” along street frontages.

Large parking lots (21 parking spots or more)

1) A minimum of 15% of the area in the parking lot must be landscaped.

2) Trees shall be planted in an orchard-like pattern in 5’ wide planter strips between facing rows of parking spaces. These planter strips may be reduced in width to 4’ if combined with walkways. In these planter strips, trees shall be planted at 20’ intervals. Ground- large parking lots require 15% of the area landscaped covers and/or shrubs shall be trees in 5 ft. planter strips are required between facing rows of parking spots planted covering 75% of the ground safe pedestrian routes are part of the circulation plan at the time of planting.

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 39

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 27 5) Landscaping

iv. Standards

1) A landscape plan, prepared by a registered landscape architect is required for all developments.

2) All multi-family residential developments shall incorporate Garry Oaks into their landscape designs.

3) Irrigation systems are required for all commercial landscapes and common landscapes in multi-family residential developments. Water conserving drip irrigation systems are preferred.

4) Deciduous trees shall be a minimum of 3” trunk diameter at the time of planting.

5) Coniferous trees shall be a minimum of 6 feet tall at the time of planting.

6) Shrubs and ground covers shall be a minimum size equal to 2 gallon potted plants where appropriate.

7) All planter areas must have at least 3 ft. of amended soils (or more if determined necessary per species proposed).

8) Parking lot planters shall be a minimum of 5 ft. X 8 ft. measured from inside of curbing.

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 40

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 28 6) Variances Section Items Purpose i. Process & Because of the complexity of Requirements sites and development scenarios, not all regulations will be achievable or yield the desired outcome.

Therefore, the Design Regu- lations and Guidelines have been developed with built-in options and procedures for varying from these standards.

Those areas of flexibility have been identified throughout this booklet, including the requirements with which variance requests will be assessed. The following outlines what is required of applicants for processing administrative variances .

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 41

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 29 6) Variances

i. Process & Requirements

1) To apply for an administrative variance(s), an applicant must include the following at the time of submitting application(s): 1) a list of the design regulations that are being varied; 2) a narrative clearly explaining each of these, including how the proposed change(s) meets the standards for variances; and 3) a drawing(s) clearly showing the areas where changes are being proposed (this must be a separate drawing(s) specifically for the purpose of reviewing the variance).

2) The administrative variance will be reviewed as part of the overall application review process, and will meet the requirements of the Oak Harbor Municipal Code.

Approved 4/18/06

September 25, 2019 Workshop Meeting Packet 42

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 15 3) Neighborhood Context

i. Old Town

The retail heart of the Historic Down- town of Oak Harbor is zoned Central Business District (CBD). In the Oak Har- bor Municipal Code (OHMC), the purpose of the CBD district is to “preserve and enhance the unique harbor location of the city’s heritage with the character of the traditional center of social, cultural and retail activity.”

Previous sections of this document may be viewed as a foundation to cohesive and attractive design within the historic downtown area. When considering new development or remodeling existing structures in the CBD, an applicant may view the preceding sections as a check-  Weather protection provided for pedestrians  Awning design provides historical context to architectural characteris- list to ensure baseline compliance, with tics of Old Town neighborhood the following CBD-specific details as additional guidance in how to achieve a completed project that is consistent with the community’s vision for the neighborhood.

Historic downtowns which are attractive, safe, walkable, and pedestrian- friendly districts with a distinct character, especially if connected to an active waterfront and park system, remain universally popular with citizens and visitors alike.

The predominant architectural character of the Historic Downtown is typical of early 20th Century commercial development, interspersed with vacant lots and later 20th century structures. Pioneer Way itself is a solid backbone for future construction, with wide, pe-  Building entrance recessed as per historic context of destrian –friendly sidewalks, substantial Old Town neighborhood landscaping and public art.  Materials and architecture typical of existing development  Building located at front setback

DRAFT 9/17/19

September 25, 2019 Workshop Meeting Packet 43

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 16 3) Neighborhood Context

i. Old Town

General Goals

 Preserve and enhance the unique harbor location of the city’s heritage with the character of the traditional center of social, cultural and retail activity

 An Historic Old Town neighborhood that all Oak Harbor residents and visitors can use and enjoy

 Create an active, unique, interest- ing and successful environment in the Old Town area

 Develop a neighborhood that will again serve as the vibrant heart of the City of Oak Harbor

General Strategies

 Create an ambiance of pleasant human scaled development, interest and activity

 Minimize the physical and visual impact of the automobile

DRAFT 9/17/19

September 25, 2019 Workshop Meeting Packet 44

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 17 3) Neighborhood Context

i. Old Town

General Standards

1) Applicable, previously-listed standards within this document apply.  Building located at front Not all standards will apply to all setback projects, so utilize all sections of  Historically–appropriate rhythm and materials the document as a checklist to  Pedestrian amenities ensure compliance with appropri- include weather protection ate sections.

Focus particularly on design with complimentary choices for materials, building scale, proportions and architectural details.

Ensure that pedestrian access, safety and comfort are addressed in site design and building layout.

2) All zoning district use regulations are applicable.

 Building entrances shall be recessed as per historic context of Old Town  Parking is only permitted in the rear of buildings— pedestrian access is direct

DRAFT 9/17/19

September 25, 2019 Workshop Meeting Packet 45

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 18 3) Neighborhood Context

i. Old Town

Detail, Color and Texture

Details are especially important at the pedestrian level, but all historical features should be preserved and high- lighted. A white or very light color will allow light and shadow to emphasize those details. Bright colors can call attention to a particularly unique ele-  Texture created by horizontal siding is appropri- ment, while a duller or darker material ate based on the existing creates an attractive background for development in the Old contrasting trim details. Windows may Town neighborhood.  Complementary color be emphasized with light colors to best brings interest to build- show detail and contrast with the wall. ings and displays within. A building with minimal detail may benefit from a hue that allows it to recede into the overall streetscape.

The exterior texture of a building wall allows it to weather gracefully and gain patina. Texture can also have the effect of bringing a large wall surface down to the scale of the hand that placed each brick or stone. When pre- serving existing, or creating new features, fine details can add an unmistak- able sense of celebration to the simple acts of viewing or entering a building. Texture at a variety of levels is an important tool used to create a pedestrian scale environment — the surfaces of the city floor; the streetscape wall; the more intimate texture of street furni- ture and fixtures; individual building details; and the everchanging texture of landscaping.

 Detail on building façade brings interest to structure as well as to the streetscape wall.

DRAFT 9/17/19

September 25, 2019 Workshop Meeting Packet 46

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 19 3) Neighborhood Context

i. Old Town

Pattern and Proportion

Structural elements, materials, windows and other openings create distinct patterns that help define the character of a neighborhood.

Modulation of these patterns using rhythm and proportional relationships adds interest to a design, as well as defining the scale of a building façade or public space. Understanding these relationships can help create a sense of visual continuity in a neighborhood or streetscape. Well-executed patterns and proportions in the historic district should inform the design of newer structures, as this will help relate them  Pattern of windows and awnings creates visual interest and relates buildings to each other to the existing heritage and greatly enhance the overall visual experience.

Standards

3) Buildings shall respect the architectural heritage of the neighborhood by complementing existing patterns and proportions.

4) Buildings must be located on the street frontage property line.

5) All awnings and/or canopies must be designed to complement the aesthetic and architectural characteristics of the Old Town neighborhood. Back-lit awnings are prohibited.

6) Building entrances shall be recessed into the building as per the historic context of the neighborhood.

DRAFT 9/17/19

September 25, 2019 Workshop Meeting Packet 47

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 20 3) Neighborhood Context

i. Old Town

Human Scale

The creation of a pleasant human- scaled environment within the CBD is crucial to the success of the neighborhood as a whole. Visual interest and easy pedestrian access will help create a more vibrant and successful downtown. This goal may be achieved through the implementation of pedestrian-oriented design features.

Standards

7) Weather protection should be provided along building frontages and shall be placed no more than 15 ft above the ground.

8) Only one driveway access is permitted per site.

9) Parking is only permitted in the rear of buildings.

DRAFT 9/17/19

September 25, 2019 Workshop Meeting Packet 48

CITY OF OAK HARBOR DESIGN REGULATIONS & GUIDELINES Page 21 3) Neighborhood Context

i. Old Town

Signage

Providing information or advertising is not the only purpose of signage within an urban area. While those two goals are primary, signage may also be an  Pedestrian-scaled signage is clearly intended integral part of building design and for slow-moving viewers. contribute to the overall look and feel  Materials and design complement existing development of a neighborhood.

Signage should be appropriate not only to the scale of the building or business to which it is attached, but to the intended recipient of the message. A large pole sign may be appropriate for a location where the message-seeker is traveling rapidly in a car, but in the Old Town area, most signs should be oriented to the pedestrian, or slow-moving traffic.

Standards

10) Signage should be designed with pedestrians and slow-moving traffic in mind. Smaller sign areas are appropriate, as well as those oriented perpendicularly to the building façade.

11) Sign materials should be appropriate for the neighborhood. As with building design, existing development and materials should inform the design of new signage.

DRAFT 9/17/19

September 25, 2019 Workshop Meeting Packet 49 City of Oak Harbor Date: September 25, 2019 City Council Subject: Shoreline Master Program Workshop Agenda Bill Periodic Review: DOE Grant

FROM:Steve Powers, AICP, Director Development Services

SUMMARY STATEMENT While recent mandated work efforts (critical areas ordinance, low impact development) did not include financial assistance, the state legislature has provided allocations to communities for the mandated Shoreline Master Program (SMP) periodic review. As noted in the letter from the Department of Ecology (see Attachment 1) the City of Oak Harbor is being offered a grant of $22,400. It is also important to note that, upon application for the grant, we will receive an additional year to complete our SMP periodic review. Staff will request Council approval to proceed with the grant application at the October 1, 2019 City Council meeting. There has been a considerable amount of attention focused at the Scenic Heights shoreline/bluff interface. That area is known as the Residential- Bluff Conservancy Environment Designation in our current SMP and extends south from Freund’s Marsh to the city limits. Staff is suggesting that the grant monies be used for consultant assistance to assess the geologic and hydraulic characteristics of this area and ensure that our current SMP and critical areas regulations balance the function and value of this sensitive area with existing property rights. Please see Attachment 2 for a draft request for proposal.

ATTACHMENTS 1. Department of Ecology letter dated July 12, 2019 2. Draft request for proposal

September 25, 2019 Workshop Meeting Packet 50 September 25, 2019 Workshop Meeting Packet 51 September 25, 2019 Workshop Meeting Packet 52 REVIEW EFFECTIVENESS OF POLICIES/REGULATIONS ASSOCIATED WITH THE CITY OF OAK HARBOR SHORELINE MASTER PROGRAM RESIDENTIAL BLUFF CONSERVANCY ENVIRONMENT DESIGNATION Request For Proposal

PURPOSE The City of Oak Harbor Development Services Department invites qualified environmental/geologic consultant firms to submit a proposal to analyze existing policies and regulations within the City’s Shoreline Master Program (SMP) and Oak Harbor Municipal Code (OHMC). The focus is within the Residential Bluff Conservancy Designation of the SMP and is intended to ensure protection and preservation of the safety and ecology of the bluff system is balanced with private property rights.

SCOPE OF SERVICES To conduct document/field review of selected parcels to assess the geologic characteristics of the soils, sediments, and/or rock of the project area. This assessment should include: a review of the history regarding landslides and erosion; underlying geology, slope gradients, and soil types; a description of the hydrology (both surface and subsurface) of the site, including locations of any streams, springs, seeps, and ground water; and, an estimate of bluff retreat rate that recognizes and reflects potential catastrophic events such as seismic activity or a 100-year storm event.

Attendance at a stakeholder’s meeting will also be required.

The assessment shall include policy or regulation recommendations designed to maintain no net loss of the function and value of this shoreline designation.

DELIVERABLES • Geologic memorandum summarizing methods and results of assessment. • Recommendations for additions or amendments to existing SMP policies/regulations or the OHMC. • Field reports and documentation supporting recommendations.

ACCEPTANCE/REJECTION OF RESPONSES The City reserves the right and holds at its discretion the following rights and options: • To waive any or all informalities in any proposal; • To reject any or all responses; • To issue subsequent requests.

September 25, 2019 Workshop Meeting Packet 53 PROPOSAL SCHEDULE The following schedule has been established for the submission and evaluation of the proposals and selection of the consultant. These are tentative dates only and the City reserves the right to adjust these dates at its sole discretion. • RFP response submittal deadline: 5:00 p.m. (PST) October 18, 2019. • Tentative candidate selection: November 1, 2019.

EVALUATION CRITERIA Submittals will be evaluated and ranked based on the following: • Professional qualifications of the consultant, previous experience with similar projects, and competence of the consultant team; • Understanding of the project and approach toward scope of services and demonstrated ability to successfully communicate and interact with clients; • Appropriateness of organization, key personnel and their availability; • References from public agency clients; • Capability to meet schedules and demonstrated cost controls from similar projects.

City of Oak Harbor encourages disadvantaged, minority, and women-owned consultant firms to respond.

The submittal shall include three (3) hard copy sets of the proposal on recyclable paper and shall include the proposal on a USB drive in PDF format. Submittals must be mailed or hand delivered to:

City of Oak Harbor Development Services Department Attn: Dennis Lefevre, AICP 865 SE Barrington Drive Oak Harbor, WA 98277

No submittals will be accepted after the specified date and time.

CONTACT INFORMATION Questions concerning this RFP must be received by email. Email solicitation should be directed to: Dennis Lefevre, AICP, Senior Planner [email protected].

September 25, 2019 Workshop Meeting Packet 54 City of Oak Harbor Date: September 25, 2019 City Council Subject: Utilities Proposed Code Workshop Agenda Bill Amendments & Efficencies

FROM:Patricia Soule, Finance Director Finance

SUMMARY STATEMENT Present options for changes to code and efficiencies within the Utility Code and department.

ATTACHMENTS None.

September 25, 2019 Workshop Meeting Packet 55 City of Oak Harbor Date: September 25, 2019 City Council Subject: Private Smoking Facilities Workshop Agenda Bill Regulations

FROM:Nikki Esparza, City Attorney

SUMMARY STATEMENT This item will be a discussion relating to private smoking facilities and how the City can regulate them. Staff will be seeking direction on whether to pursue zoning code changes or simply regulate as Seattle has done.

ATTACHMENTS None.

September 25, 2019 Workshop Meeting Packet 56 City of Oak Harbor Date: September 25, 2019 City Council Subject: Follow-up on Conflict Indigent Workshop Agenda Bill Defense Services

FROM:Nikki Esparza, City Attorney

SUMMARY STATEMENT On September 6, 2016, City Council authorized an hourly rate of $55 per hour for indigent defense representation by conflict attorneys. Staff issued a RFQ and subsequently contracted with one attorney. On May 22, 2019, in anticipation of the conflict attorney contract expiring, staff recommended new rates to encourage a greater number of conflict counsel response to the RFQ. City Council recommended a rate of $75 per hour and the RFQ was issued in June of 2019. The City has not received a response to the RFQ, to date and the conflict attorney contract expired August 31, 2019. Therefore, if there is a conflict to the City's contracted primary indigent defense attorney, the Judge will now assign a conflict indigent defense attorney and set the fee.

ATTACHMENTS None.

September 25, 2019 Workshop Meeting Packet 57 Date: September 25, 2019 City of Oak Harbor Subject: Department of Ecology General City Council Nutrient Removal Permit Workshop Agenda Bill Comments

FROM:Cathy Rosen, Public Works Director & James Bridges, City Engineer Public Works

SUMMARY STATEMENT The Washington Department of Ecology initiated the process of setting nutrient standards in the Puget Sound. This rulemaking process will eventually impose new discharge standards on municipal wastewater treatment plants to control nutrients. The rulemaking process contains several steps soliciting public comment. The new standards have the potential to impact rates and growth for all cities. With the investment in the Clean Water Facility, Oak Harbor is already achieving the goals of the new regulations. Throughout the rulemaking process, Oak Harbor should strive to receive appropriate recognition of the community’s investment in water quality.

ATTACHMENTS None.

September 25, 2019 Workshop Meeting Packet 58 City of Oak Harbor Date: September 25, 2019 City Council Subject: EnviroIssues Contract Workshop Agenda Bill Amendments No. 2 & No. 3

FROM:Cathy Rosen, Public Works Director & James Bridges, City Engineer Public Works

SUMMARY STATEMENT Staff will discuss the proposed Enviroissues contract amendments and the deliverables associated with these contracts.

ATTACHMENTS None.

September 25, 2019 Workshop Meeting Packet 59 Date: September 25, 2019 City of Oak Harbor Subject: Affordable Housing State Sales City Council Tax Credit for Local Workshop Agenda Bill Government

FROM:Blaine Oborn, City Administrator

SUMMARY STATEMENT In the 2019 legislative session, the State approved SHB 1406 to provide a new affordable housing revenue stream for those counties, cities, and towns that choose to participate. This sales tax option is a credit against the State sales tax rate of 6.5%, so it will not increase the tax rate for consumers. However, the City has a limited time to take advantage of this affordable housing State sales tax credit and must act rather quickly if the City wishes to participate. Coordination with Island County is also required. Options will be presented, and staff will be seeking preliminary direction on how to proceed with the estimated annual tax credit of $34,723 (.0073%).

ATTACHMENTS 1. AWC - Implementing HB 1406 2. MRSC - SHB 1406: Understanding the Affordable Housing Sales Tax Credit 3. Pacifica Law Group presentation to Island County on SHB 1406

September 25, 2019 Workshop Meeting Packet 60 Tax credit rate examples but, importantly, only after voter approval. This sales tax levy Implementing HB 1406 is considered a “qualifying local tax” under HB 1406. Another Max tax City with City City doesn’t County doesn’t 2019 credit rate qualifying without levy a tax participate, city important distinction is that the affordable housing sales tax under HB local tax qualifying credit, participates but from 2015 is an additional tax on the consumer, and not a 1406 local tax county does doesn’t have a credit on an existing state-imposed tax. participate qualifying tax.* Don’t miss out on up to 20 years of shared City 0.0146% 0.0073% 0.0% July 2020: 0.0% 2. Do we have to levy a “qualifying local tax” to participate? No. Your city is still eligible to participate in the County 0.0% 0.0073% 0.0146% 0.0% program, but your tax credit rate will depend on whether revenue for affordable housing *We believe that this was an error in bill drafting. Please let us know if you are in the county participates in the program. See Tax credit rate this situation. We can work to address it in future legislative sessions. examples chart to the left. Eligible uses of the funds: 3. Do we only have access to the program if the county In the 2019 legislative session, the state approved a Eligibility to receive shared revenues 1. Projects must serve those at or below 60% AMI. declines to participate? No. A city can participate, and local revenue sharing program for local governments • The state is splitting the shared resources between by providing up to a 0.0146% local sales and use 2. Acquiring, rehabilitating, or constructing affordable receive funds, even if the county participates. Unfortunately, cities and counties. However, cities can receive both housing, which may include new units of affordable if your city does not impose a “qualifying local tax” by the tax credited against the state sales tax for housing shares if they have adopted a “qualifying local tax” housing within an existing structure or facilities providing deadline and your county declines to participate, then you investments, available in increments of 0.0073%, by July 31, 2020. Qualifying taxes are detailed below. will not have access to funds after the first year, due to a supportive housing services. In addition to investing in depending on the imposition of other local taxes and Cities who are levying a “qualifying local tax” by July drafting error in the bill. We don’t anticipate this scenario traditional subsidized housing projects, this authority could whether your county also takes advantage. The tax 28, 2019, the effective date of the new law, will receive potentially be used to provide for land acquisition, down to occur, but please let us know if you find yourself in that credit is in place for up to 20 years and can be used for both shares immediately once they impose the new payment assistance, and home repair so long as recipients situation. We will work with the Legislature to address it if this acquiring, rehabilitating, or constructing affordable proves problematic. In all cases you must meet the program sales tax credit. meet the income guidelines. housing; operations and maintenance of new affordable deadlines to participate. See Deadlines to participate. 3. Funding the operations and maintenance costs of new units or supportive housing facilities; and, for smaller cities, • If a city does not implement a qualifying local tax by of affordable or supportive housing. 4. Does it make a difference at all if our county rental assistance. The funding must be spent on projects the deadline, they can still participate in the program if participates? Only if you have not adopted a “qualifying that serve persons whose income is at or below sixty they meet the other deadlines but will be eligible for a 4. For cities with a population under 100,000, the funds can local tax.” If you have adopted a “qualifying local tax” you percent of the area median income. Cities can also issue lower credit rate. also be used for rental assistance to tenants. can access the higher credit rate regardless of county participation. If you don’t have a “qualifying local tax” then bonds to finance the authorized projects. • A city can adopt the sales tax credit before designating Additional timelines to keep in mind: you can only access the higher rate if the county does not how the funds will be used once collected. This local sales tax authority is a credit against the state participate. 1. Department of Revenue (DOR) requires 30-days-notice of sales tax, so it does not increase the sales tax for the Qualifying local taxes adoption of sales tax credits. The credit will then take effect 5. How is “rental assistance” defined? Does that include consumer. There are tight timelines that must be met to on the first day of the month following the 30-day period. The following are considered “qualifying local taxes” and, rent vouchers? The term “rental assistance” is not defined access this funding source – the first is January 31, 2020 in the chapter 82.14 RCW; however, both federal and if levied, give the city access to both shares of the tax 2. If your city is adopting a “qualifying local tax”, DOR to pass a resolution of intent. The tax ordinance must state housing programs use the term “rental assistance” to credit (i.e. 0.0146% rate instead of the single share rate of requires 75-days-notice of adoption of sales tax increases. then be adopted by July 27, 2020 to qualify for a credit. Local sales tax increases may only take effect on the first mean providing rent, security deposits, or utility payment 0.0073%): day of the first, second, or third quarter – not the fourth assistance to tenants. The following information is intended to assist your city • Affordable housing levy (property tax) under (April 1, July 1, or October 1). 6. Can we pool our revenue with another entity? Can in evaluating its options and timelines. It is not intended RCW 84.52.105 3. If your city is adopting a “qualifying local tax” remember we issue bonds or use the money to repay bonds? as legal advice. Check with your city’s legal counsel and/ • Sales and use tax for housing and related services to factor in the ballot measure process into the timeline, Yes! Cities can enter into an interlocal agreement with or bond counsel for specific questions on project uses other local governments or a public housing authority under RCW 82.14.530. The city must have adopted at as these must be approved by the voters. and deadlines for implementation. to pool tax receipts, pledge tax collections to bonds, least half of the authorized maximum rate of 0.001%. 4. If you are intending to bond the revenues for a project allocating collected taxes to authorized affordable housing under this authority, check with your legal counsel and • Sales tax for chemical dependency and mental health expenditures, or other agreements authorized under bond counsel about other deadlines that may apply to (optional .1 MIDD) under RCW 82.14.460 chapter 39.34 RCW. Cities may also use the tax credit your city. revenue to issue or repay bonds in order to carry out the Deadlines to participate: • Levy (property tax) authorized under RCW 84.55.050, if projects authorized under the new law. • Resolution to levy tax credit: July 28, 2019 – January used solely for affordable housing Frequently asked questions: 7. Is the amount of tax credit we receive limited only by the 31, 2020 Think of the “qualifying local tax” as a multiplier or 1. This program sounds very familiar. Didn’t a local option, amount of sales tax collected per year? No. The maximum • Ordinance to levy the tax credit: By July 27, 2020 “doubler.” It gives the city access to double the tax credit affordable housing sales tax law pass a few years amount will be based on state fiscal year 2019 sales. even when the county chooses to participate in the ago? Yes, but the new law has important differences. The • Adopt “qualifying local tax” (optional): By July 31, 2020 Legislature passed HB 2263 in 2015 that authorized cities and 8. Does the tax credit program expire? Yes, the tax expires program. towns to levy up to a 0.1% sales tax for affordable housing— 20 years after the date on which the tax is first levied.

Carl Schroeder Shannon McClelland Carl Schroeder Shannon McClelland Government Relations Advocate Legislative & Policy Analyst Government Relations Advocate Legislative & Policy Analyst Contact: [email protected] [email protected] Contact: [email protected] [email protected]

Association of Washington Cities • 1076 Franklin St SE, Olympia, WA 98501 • 1.800.562.8981 • wacities.org 06/20/19 Association of Washington Cities • 1076 Franklin St SE, Olympia, WA 98501 • 1.800.562.8981 • wacities.org 06/20/19 September 25, 2019 Workshop Meeting Packet 61 Is your city interested in accessing additional 1 funding to support affordable housing for the next Six steps to affordable housing revenue 20 years?

Maybe. Yes No What can we spend All projects must serve households with incomes at the money on? or below 60% Area Median Income (AMI). Is the city’s population more than 100,000? No action required. Does your city levy a “qualifying local tax”? 2 Yes No All of the options for cities over 100,000, plus rental assistance to Yes What’s a “qualifying No Can your city adopt a “qualifying local tax” tenants. local tax”? by July 31, 2020, including ballot measure?

Yes No Your city is still • Acquiring, rehabing, or constructing affordable 1. Affordable housing levy The law requires a resolution of intent to impose eligible to participate housing. Includes new units within an existing (RCW 84.52.105) 3 the tax credit. Can your city adopt a resolution in the program. Go to structure or supportive housing facilities under OR of intent between July 28, 2019 and January 31, Step 3 to continue. RCW 71.24.385. Consider bonding, land acquisition, 2020? direct capital investment down payment assistance, 2. Sales and use tax for housing and rehabilitation of single-family homes owned by and related services (RCW Yes Unfortunately, your city individuals who meet the 60% AMI qualification. 82.14.530). Must impose at No is no longer eligible to lease half of the authorized OR participate in the program. rate. • Funding the operations and maintenance costs of new units of affordable or supportive housing. OR Great! Next, your city must adopt an ordinance by 3. Sales tax for chemical 4 July 27, 2020 to levy the maximum tax under HB dependency and mental health 1406. Did you or will you? services or therapeutic courts (RCW 82.14.460). Yes No Important dates: OR • Resolution to levy tax credit: July 28, 2019 – January 4. Levy (property tax) under RCW 31, 2020 84.55.050, if used solely for affordable housing. Great! Now let’s find out what your maximum tax • Ordinance to levy the tax credit: By July 27, 2020 5 rate is. Did your city instate a “qualifying local tax” • Adopt “qualifying local tax” (optional): By July 31, 2020 by the deadline – July 31, 2020? A “qualifying local • See also Additional timelines to keep in mind tax” is not required but can increase your tax credit. on the back

Yes No Did your county levy its share of the tax credit?

Yes No If the county declared they will not levy the tax or have not adopted a resolution of intent by February 1, 2020, your Was your city levying the “qualifying local tax” city’s tax rate will be 0.0146%. (See Important Dates.) 6 before you instated the tax credit under HB 1406? Your tax credit rate is 0.0073% starting on the date Yes No the tax credit is levied. (See Important Dates.)

Your tax credit rate is 0.0146% Until July 1, 2020, your tax credit rate is 0.0073% starting starting on the date the tax credit on the date the tax credit is levied. (See Important is levied. (See Important Dates.) Dates.) After July 1, 2020, your tax credit rate is 0.0146%.

September 25, 2019 Workshop Meeting Packet 62 Tax credit rate examples but, importantly, only after voter approval. This sales tax levy Implementing HB 1406 is considered a “qualifying local tax” under HB 1406. Another Max tax City with City City doesn’t County doesn’t 2019 credit rate qualifying without levy a tax participate, city important distinction is that the affordable housing sales tax under HB local tax qualifying credit, participates but from 2015 is an additional tax on the consumer, and not a 1406 local tax county does doesn’t have a credit on an existing state-imposed tax. participate qualifying tax.* Don’t miss out on up to 20 years of shared City 0.0146% 0.0073% 0.0% July 2020: 0.0% 2. Do we have to levy a “qualifying local tax” to participate? No. Your city is still eligible to participate in the County 0.0% 0.0073% 0.0146% 0.0% program, but your tax credit rate will depend on whether revenue for affordable housing *We believe that this was an error in bill drafting. Please let us know if you are in the county participates in the program. See Tax credit rate this situation. We can work to address it in future legislative sessions. examples chart to the left. Eligible uses of the funds: 3. Do we only have access to the program if the county In the 2019 legislative session, the state approved a Eligibility to receive shared revenues 1. Projects must serve those at or below 60% AMI. declines to participate? No. A city can participate, and local revenue sharing program for local governments • The state is splitting the shared resources between by providing up to a 0.0146% local sales and use 2. Acquiring, rehabilitating, or constructing affordable receive funds, even if the county participates. Unfortunately, cities and counties. However, cities can receive both housing, which may include new units of affordable if your city does not impose a “qualifying local tax” by the tax credited against the state sales tax for housing shares if they have adopted a “qualifying local tax” housing within an existing structure or facilities providing deadline and your county declines to participate, then you investments, available in increments of 0.0073%, by July 31, 2020. Qualifying taxes are detailed below. will not have access to funds after the first year, due to a supportive housing services. In addition to investing in depending on the imposition of other local taxes and Cities who are levying a “qualifying local tax” by July drafting error in the bill. We don’t anticipate this scenario traditional subsidized housing projects, this authority could whether your county also takes advantage. The tax 28, 2019, the effective date of the new law, will receive potentially be used to provide for land acquisition, down to occur, but please let us know if you find yourself in that credit is in place for up to 20 years and can be used for both shares immediately once they impose the new payment assistance, and home repair so long as recipients situation. We will work with the Legislature to address it if this acquiring, rehabilitating, or constructing affordable proves problematic. In all cases you must meet the program sales tax credit. meet the income guidelines. housing; operations and maintenance of new affordable deadlines to participate. See Deadlines to participate. 3. Funding the operations and maintenance costs of new units or supportive housing facilities; and, for smaller cities, • If a city does not implement a qualifying local tax by of affordable or supportive housing. 4. Does it make a difference at all if our county rental assistance. The funding must be spent on projects the deadline, they can still participate in the program if participates? Only if you have not adopted a “qualifying that serve persons whose income is at or below sixty they meet the other deadlines but will be eligible for a 4. For cities with a population under 100,000, the funds can local tax.” If you have adopted a “qualifying local tax” you percent of the area median income. Cities can also issue lower credit rate. also be used for rental assistance to tenants. can access the higher credit rate regardless of county participation. If you don’t have a “qualifying local tax” then bonds to finance the authorized projects. • A city can adopt the sales tax credit before designating Additional timelines to keep in mind: you can only access the higher rate if the county does not how the funds will be used once collected. This local sales tax authority is a credit against the state participate. 1. Department of Revenue (DOR) requires 30-days-notice of sales tax, so it does not increase the sales tax for the Qualifying local taxes adoption of sales tax credits. The credit will then take effect 5. How is “rental assistance” defined? Does that include consumer. There are tight timelines that must be met to on the first day of the month following the 30-day period. The following are considered “qualifying local taxes” and, rent vouchers? The term “rental assistance” is not defined access this funding source – the first is January 31, 2020 in the chapter 82.14 RCW; however, both federal and if levied, give the city access to both shares of the tax 2. If your city is adopting a “qualifying local tax”, DOR to pass a resolution of intent. The tax ordinance must state housing programs use the term “rental assistance” to credit (i.e. 0.0146% rate instead of the single share rate of requires 75-days-notice of adoption of sales tax increases. then be adopted by July 27, 2020 to qualify for a credit. Local sales tax increases may only take effect on the first mean providing rent, security deposits, or utility payment 0.0073%): day of the first, second, or third quarter – not the fourth assistance to tenants. The following information is intended to assist your city • Affordable housing levy (property tax) under (April 1, July 1, or October 1). 6. Can we pool our revenue with another entity? Can in evaluating its options and timelines. It is not intended RCW 84.52.105 3. If your city is adopting a “qualifying local tax” remember we issue bonds or use the money to repay bonds? as legal advice. Check with your city’s legal counsel and/ • Sales and use tax for housing and related services to factor in the ballot measure process into the timeline, Yes! Cities can enter into an interlocal agreement with or bond counsel for specific questions on project uses other local governments or a public housing authority under RCW 82.14.530. The city must have adopted at as these must be approved by the voters. and deadlines for implementation. to pool tax receipts, pledge tax collections to bonds, least half of the authorized maximum rate of 0.001%. 4. If you are intending to bond the revenues for a project allocating collected taxes to authorized affordable housing under this authority, check with your legal counsel and • Sales tax for chemical dependency and mental health expenditures, or other agreements authorized under bond counsel about other deadlines that may apply to (optional .1 MIDD) under RCW 82.14.460 chapter 39.34 RCW. Cities may also use the tax credit your city. revenue to issue or repay bonds in order to carry out the Deadlines to participate: • Levy (property tax) authorized under RCW 84.55.050, if projects authorized under the new law. • Resolution to levy tax credit: July 28, 2019 – January used solely for affordable housing Frequently asked questions: 7. Is the amount of tax credit we receive limited only by the 31, 2020 Think of the “qualifying local tax” as a multiplier or 1. This program sounds very familiar. Didn’t a local option, amount of sales tax collected per year? No. The maximum • Ordinance to levy the tax credit: By July 27, 2020 “doubler.” It gives the city access to double the tax credit affordable housing sales tax law pass a few years amount will be based on state fiscal year 2019 sales. even when the county chooses to participate in the ago? Yes, but the new law has important differences. The • Adopt “qualifying local tax” (optional): By July 31, 2020 Legislature passed HB 2263 in 2015 that authorized cities and 8. Does the tax credit program expire? Yes, the tax expires program. towns to levy up to a 0.1% sales tax for affordable housing— 20 years after the date on which the tax is first levied.

Association of Washington Cities • 1076 Franklin St SE, Olympia, WA 98501 • 1.800.562.8981 • wacities.org 06/20/19 Association of Washington Cities • 1076 Franklin St SE, Olympia, WA 98501 • 1.800.562.8981 • wacities.org 06/20/19 September 25, 2019 Workshop Meeting Packet 63 9/12/2019 MRSC - SHB 1406: Understanding the Affordable Housing Sales Tax Credit

SHB 1406: Understanding the Affordable Housing Sales Tax Credit

July 17, 2019 by Toni Nelson Category: Housing , New Legislation and Regulations , Sales and Use Taxes

Editor's note: Due to the high-profile and fast-moving nature of this topic, we will be updating this post with new information and examples as they become available. Readers are encouraged to bookmark this page and check back frequently, or eligible government agencies may also submit questions about SHB 1406 to our Ask MRSC service. Recent updates include:

September 9-10: Added East Wenatchee and Skamania County resolutions of intent; added Tumwater ordinance August 28: Clarified timing of adoption of enacting ordinances and calculation of maximum distribution caps, emphasizing need for counties to adopt their ordinances first to maximize revenues; added Pacific County ordinance. August 20: Added links to WSAC resources and Pierce County ordinance. August 8: Updated revenue estimate worksheet with Q1 2019 sales tax data from DOR; added sample resolutions of intent. July 24: Added examples of resolutions of intent.

mrsc.org/Home/Stay-Informed/MRSC-Insight/July-2019/SHB-1406-Affordable-Housing-Sales-Tax-Credit.aspxSeptember 25, 2019 Workshop Meeting Packet1/7 64 The9/12/2019 2019 legislative session produced MRSCa plethora - SHB 1406: of bills, Understanding but SHB the 1406 Affordable has Housing generated Sales Tax significant Credit buzz as it will provide a new affordable housing revenue stream for those counties, cities, and towns that choose to participate. This sales tax option is actually a credit against the state sales tax rate of 6.5%, so it will not increase the tax rate for consumers. However, cities, towns, and counties have a limited time to take advantage of this option and must act rather quickly if they wish to participate.

It is imperative that cities and counties communicate and coordinate closely to implement this legislation, or else both cities and counties may lose out on some revenues. See the "tax rates for participating cities" and "annual maximum distribution cap" sections below for more information.

In order to understand the foundation of this bill, it’s important to understand what is considered a participating and non-participating city or county. A “participating” city or county is one that chooses to impose the affordable housing sales tax credit provided in SHB 1406 and completes the required steps for adoption within the next 12 months, while a “nonparticipating” city or county is one that chooses not to implement the affordable housing sales tax credit.

In this blog we discuss this complicated piece of legislation and some of the key decisions that eligible local governments will need to make within the next few months. How Can This Revenue Be Used? The intent of the legislation is to encourage local government investments in affordable and supportive housing, and as such, the funds will be considered a restricted revenue subject to reporting requirements and audit review for compliance. The use of this sales tax partially depends upon the size of your jurisdiction:

For counties over 400,000 population and cities over 100,000 population: The funds may only be used for (a) acquiring, rehabilitating, or constructing affordable housing, which may include new units within an existing structure or facilities providing supportive housing services under RCW 71.24.385 (behavioral health organizations); OR (b) operations and maintenance costs of new units of affordable or supportive housing.

For counties under 400,000 population and cities under 100,000 population: The funds may be used for the same purposes listed above, but they may also be used to provide rental assistance to tenants that are at or below 60% of the median income of the county or city that is imposing the tax.

For any city or county, they may finance loans or grants to nonprofit organization or public housing authorities to carry out the purposes of the bill and may pledge the tax proceeds from SHB 1406 for repayment of bonds in accordance with debt limitations imposed by the state constitution or statute.

Additionally, any participating city or county may enter into an interlocal agreement with other cities, counties, and/or housing authorities to pool and allocate the tax revenues received under SHB 1406 to fulfill the intent of the legislation. How Much Revenue Will We Receive? The answer to this question depends on whether your entity has a “qualifying local tax” (see below), the local economy, and the calculation of the revenue cap included in SHB 1406. Participating jurisdictions will receive revenues for 20 years, and the amount that you receive annually will be equivalent to either 0.0073% or 0.0146% of taxable retail sales in your jurisdiction, up to an annual maximum distribution cap that is based on FY 2019 taxable retail sales. mrsc.org/Home/Stay-Informed/MRSC-Insight/July-2019/SHB-1406-Affordable-Housing-Sales-Tax-Credit.aspxSeptember 25, 2019 Workshop Meeting Packet2/7 65 Tax9/12/2019 rates for participating countiesMRSC - SHB 1406: Understanding the Affordable Housing Sales Tax Credit Counties do not need a “qualifying local tax” and will automatically receive the maximum 0.0146% rate within the unincorporated areas, up to the annual maximum distribution cap described later. Within the boundaries of each city or town, you will receive 0.0146%, minus the rate being received by the city/town. Here are the variables:

If the city chooses not to participate but the county does participate, the county will receive the full 0.0146% within the city boundaries. If a city elects to participate but does not have a “qualifying local tax” (see below), the city will receive the 0.0073% “half share” and the county will also receive a 0.0073% half share within the city boundaries. If a city elects to participate and imposes a “qualifying local tax” by the deadline, the city will receive the full 0.0146% share and the county will not receive any revenues within the city boundaries.

As the legislation is currently written, if the county elects not to participate, cities located within said county that have not enacted a qualifying local tax will not receive SHB 1406 revenues after the first year.

Tax rates for participating cities The rate your city receive depends on whether it enacts a local qualifying tax (see below) prior to the deadline of July 27, 2020, as well as whether or not your county participates.

For cities that impose a qualifying local tax by the deadline, you will receive the maximum 0.0146% rate, up to the annual maximum distribution cap described below, regardless of whether your county participates. For cities that do not have a qualifying local tax, you will receive the 0.0073% “half share,” up to the annual maximum distribution cap, but only if your county also elects to participate.

If your county declares it will not participate or does not adopt the required resolution of intent by the end of January 2020, you will receive the full 0.0146% through July 27, 2020, but after that you will not receive any further revenues. In discussions with both Association of Washington Cities (AWC) and the Department of Revenue it is believed that this is due to a drafting error in the bill. AWC does not anticipate this scenario but asks that you let them know if your city finds itself in this situation!

Annual maximum distribution cap SHB 1406 sets a cap on the maximum sales tax revenues to be credited to local government within any state fiscal year (July 1 to June 30). The cap will be calculated based upon the jurisdiction's taxable retail sales during the state’s 2019 fiscal year (July 1, 2018 — June 30, 2019). Just like the state shared revenue cycle, distributions will start July 1, and the state will cease distribution until the beginning of the next fiscal cycle if at any time during the fiscal period your distributions meet the cap.

It is very important that counties adopt the enacting legislation prior to cities and towns, or else the counties may lose out on some revenues. (This applies only to the enabling "legislation" – the order of adoption of the "resolutions of intent" does not matter.) If the county adopts the imposing legislation prior to the city(s) within its boundaries, the county's revenue cap will be calculated based on the total countywide taxable retail sales in FY 2019, including both the unincorporated and incorporated areas of the county. But if any city adopts their enabling ordinance before the county, that city's taxable retail sales will be subtracted from the county's taxable retail sales, resulting in the county's annual maximum distribution cap being reduced for the entire 20-year state tax sharing period. (See section 4(a) of the legislation.) mrsc.org/Home/Stay-Informed/MRSC-Insight/July-2019/SHB-1406-Affordable-Housing-Sales-Tax-Credit.aspxSeptember 25, 2019 Workshop Meeting Packet3/7 66 It’s9/12/2019 also important to remember that retailMRSC sales - SHB can1406: fluctuate Understanding from the Affordableyear to yearHousing depending Sales Tax Credit upon a number of economic factors, so your revenues being generated from this sales tax credit (particularly in the early years when some jurisdictions might not hit their annual caps) may fluctuate as well.

Revenue Estimates We have developed a worksheet for your revenue forecasting that was updated on August 9, 2019 to include Q2 2018-Q1 2019 taxable sales with projections for both the 0.0073% and 0.0146% tax credit options. This data comes from DOR's Retail Sales for Cities and Counties.

How Do We Impose This New Tax Option? To receive the affordable housing sales tax credit, you must:

Pass a resolution of intent by January 27, 2020 that indicates intention to impose the sales tax credit at the maximum capacity by a simple majority vote of the legislative body. This is the single most important step in being able to receive this sales tax credit option. If this deadline is missed, there are no other opportunities to access the tax. Here is a sample resolution of intent that has been prepared by Pacifica Law Group for the Association of Washington Cities (AWC) that will assist you in this process. Also see the sample resolutions at the end of this article.

Adopt legislation to authorize by July 27, 2020 to impose the maximum capacity of the affordable sales tax credit. This step must be completed in order to continue to access this sales tax credit whether you decide to impose a qualifying local tax or not. See the examples at the end of this article.

Sicne the bill explicitly requires both a “resolution of intent,” which must be adopted by January 27, 2020, and “legislation to authorize the maximum capacity of the tax” (an ordinance for most jurisdictions, but for some counties this may be a resolution), which must be adopted by July 27, 2020, it is our recommendation that these documents be adopted separately. What Is a Qualifying Local Tax? A “qualifying local tax” (QLT) is a local property or sales tax that a city has imposed, separately from SHB 1406, to address affordable housing or related issues. This provision within the bill only applies to cities and towns, and it allows them to double the sales tax credit. Counties do not need a qualifying local tax to receive the maximum distribution.

The QLT options are:

An affordable housing levy (RCW 84.52.105); A sales and use tax for affordable housing (RCW 82.14.530); A levy lid lift (RCW 84.55.050) that is restricted solely to affordable housing; or A mental health and chemical dependency sales tax (RCW 82.14.460), which is only authorized by statute for those cities of at least 30,000 population located within Pierce County.

mrsc.org/Home/Stay-Informed/MRSC-Insight/July-2019/SHB-1406-Affordable-Housing-Sales-Tax-Credit.aspxSeptember 25, 2019 Workshop Meeting Packet4/7 67 According9/12/2019 to our data, there are currentlyMRSC only - SHB six 1406: cities Understanding that have the implemented Affordable Housing at Sales least Tax one Credit of these qualifying local taxes: Bellingham, Ellensburg, Olympia, Seattle, Tacoma, and Vancouver. Port Angeles has also placed a qualifying local tax on the ballot for November 2019 – see the resolution at the end of this article which also provides a good analysis of election timing and costs.

All of the qualifying local taxes require voter approval with a simple majority vote (with the exception of the mental health and chemical dependency sales tax) and may be presented at any special, primary, or general election. (For more detailed information on any of these qualifying local taxes, refer to our Revenue Guide for Cities and Towns.)

Deciding to present a qualifying local tax before the voters in order to gain the full tax credit will require some timing considerations, as the legislation requires that the qualifying local tax must be “instated” (which DOR is interpreting to mean “approved by voters”) within 12 months of the effective date of SHB 1406. This deadline is July 27, 2020. The deadline for placement on the general election ballot is fast approaching (August 6), and the only other elections before the July 2020 deadline are the special elections in February and April. (See our Key Deadlines for voted sales and property taxes in the recently updated Revenue Guides for Cities/Towns and Counties). When Will We Start to Receive Revenues from SHB 1406? The Department of Revenue (DOR) typically requires a 75-day notice for sales tax rate changes, but since this is a sales tax credit (not a new sales tax) it will therefore only require a 30-day wait period. The credit will take effect on the first day of the month following the 30-day period (RCW 82.14.055(2)). For example, if you adopt the resolution of intent and then the enabling legislation (ordinance/resolution) during August 2019, the tax will take effect on October 1. The sales tax revenues from October will be remitted by retailers to DOR by the 25th of the following month (November), and you will receive your first distribution of this tax credit on your end-of-month December disbursement from the State Treasurer’s office. Editor's note: In this example, the original article incorrectly stated that the revenues would be distributed at the end of November.

For cities that have a qualifying local tax in place, you will receive the full credit of 0.0146% as soon as you adopt the enacting ordinance. For all other cities and towns that have adopted the enacting ordinance, you will collect a tax credit of 0.0073% until your ballot measure for a qualifying local tax has passed.

This piece of legislation is complex and a bit confusing. We have worked closely with the DOR and the AWC to bring you as much information as possible to assist with your decisions to take the first step in the process — which is to pass a resolution of intent. MRSC is ready to answer any further questions that you may have. Please do not hesitate to send me an email or give me call. AWC and WSAC Resources For cities, the Association of Washington Cities (AWC) has prepared an implementation guide and flowchart to help in your decision-making process.

For counties, the Washington State Association of Counties (WSAC) has prepared an implementation guide and flowchart, Sample Resolutions In addition to the Pacifica Law Group sample resolution of intent provided by AWC, below are a few examples of SHB 1406 resolutions we have come across. This is not a comprehensive list of all the cities and counties that are adopting resolutions. Many of the resolutions that have been adopted use very similar language based on the Pacifica mrsc.org/Home/Stay-Informed/MRSC-Insight/July-2019/SHB-1406-Affordable-Housing-Sales-Tax-Credit.aspxSeptember 25, 2019 Workshop Meeting Packet5/7 68 Law9/12/2019 Group example, but we will continueMRSC to - SHBmonitor 1406: Understandingthis topic and the Affordable periodically Housing add Sales distinct Tax Credit or noteworthy examples to this list.

Counties Pierce County Resolution No. R2019-103 (2019) – Resolution of intent for county over 400,000 population Skamania County Resolution No. 2019-30 (2019) – Resolution of intent for county under 400,000 population Thurston County Resolution No. 15801 (2019) – Resolution of intent for county under 400,000 population, with intent to enter into interlocal agreement with cities to pool revenue.

Cities East Wenatchee Resolution No. 2019-18 (2019) – Resolution of intent for city under 100,000 population Port Angeles Resolution No. 14-19 (2019) – Submitting 0.1% affordable housing sales tax (RCW 82.14.530) to voters as a qualifying local tax under SHB 1406. Includes analysis of election timing and costs, concluding it is much less expensive to submit a measure at the November 2019 general election (filing deadline: August 6) than at the February or April special election. Tumwater Resolution No. R2019-006 (2019) – Resolution of intent for city under 100,000 population. Vancouver Resolution No. M-4026 (2019) – Resolution of intent for city over 100,000 population. Includes staff report; note that Vancouver qualifies for the maximum 0.0146% because it already has a qualifying local tax.

Sample Adopting Ordinances We will post selected examples of enacting ordinances that we receive below.

Pacific County Ordinance No. 188 (2019) – Adopting maximum sales tax credit for county under 400,000 population. Ordinance clearly indicates which cities plan to participate; note that "qualifying local taxes" apply only to cities and are not required for counties to receive maximum distribution. Pierce County Ordinance No. 2019-57s (2019) – Adopting maximum sales tax credit for county over 400,000 population. Tumwater Ordinance No. O2019-024 (2019) – Adopting maximum sales tax credit for city under 100,000 population. Effective date is January 1, 2020.

MRSC is a private nonprofit organization serving local governments in Washington State. Eligible government agencies in Washington State may use our free, one-on-one Ask MRSC service to get answers to legal, policy, or financial questions.

About Toni Nelson mrsc.org/Home/Stay-Informed/MRSC-Insight/July-2019/SHB-1406-Affordable-Housing-Sales-Tax-Credit.aspxSeptember 25, 2019 Workshop Meeting Packet6/7 69 9/12/2019Toni has over 24 years of experienceMRSC with - SHBLocal 1406: Government Understanding financethe Affordable and Housing budgeting. Sales Tax Toni's Credit area of expertise include "Cash Basis" accounting and reporting, budgeting, audit prep and the financial issues impacting small local government. VIEW ALL POSTS BY TONI NELSON

mrsc.org/Home/Stay-Informed/MRSC-Insight/July-2019/SHB-1406-Affordable-Housing-Sales-Tax-Credit.aspxSeptember 25, 2019 Workshop Meeting Packet7/7 70 HB 1406: An Affordable Housing Funding Tool

Faith Pettis Jon Jurich August 28, 2019 Pacifica Law Group LLP Island County

September 25, 2019 Workshop Meeting Packet 71 Agenda

A discussion of H.B. 1406 and options for funding affordable housing • Overview of H.B. 1406 — What is it — Use of funds — How it works • Timeline and next steps • Examples and estimates • Pooling resources — Opportunities under the Interlocal Cooperation Act • Final takeaways and questions

September 25, 2019 Workshop Meeting Packet 72 Overview of H.B. 1406

September 25, 2019 Workshop Meeting Packet 73 Overview of H.B. 1406

An allocation of the state sales tax to local jurisdictions. • This is not an additional or new tax — Local jurisdictions retain a portion of the sales and use taxes already paid • Bill went into effect on July 28, 2019. • All cities and counties are eligible. — If a city and county both act to implement, the bill outlines when a city can claim the full authority. — Otherwise it is shared. • Department of Revenue determines the maximum revenue, based on state fiscal year 2019 taxable retail sales within the county or city. — It is important for a county to go before the cities in their county. • Earliest possible use of the funds is fall 2019. • Authority expires 20 years after the tax is claimed.

September 25, 2019 Workshop Meeting Packet 74 Use of Funds

September 25, 2019 Workshop Meeting Packet 75 Use of the funds

The funds may be used for affordable housing, but specific allowable uses vary by county or city population. • Counties with a population greater than 400,000 and cities with a population greater than 100,000: — Acquiring, rehabilitating, or constructing affordable housing, which may include new units of affordable housing within an existing structure or facilities providing supportive housing services under RCW 71.24.385; or funding the operations and maintenance costs of new units of affordable or supportive housing. • Counties with a population less than 400,000 and cities with a population less than 100,000: — The above uses and/or for rental assistance. • The housing and services may only be provided to persons whose income is at or below 60 percent of the median income of the county imposing the tax.

September 25, 2019 Workshop Meeting Packet 76 Use of the funds

Using the funds jointly, and to pay bonds.

• Pledging the tax to general obligation or revenue bonds — Cities or counties imposing the tax may issue general obligation or revenue bonds and may pledge the revenue collected for repayment of the bonds. • Pooling the tax — A county or city may enter into an interlocal agreement with other local government or public housing authorities to pool the tax receipts received and may pledge those taxes to bonds.

September 25, 2019 Workshop Meeting Packet 77 Use of the funds

Investing in facilities and providing supportive investments. • Facilities investment — Directly investing in construction or rehabilitation of affordable housing projects or facilities providing supportive housing services • Gap financing to help projects already in the works achieve financial viability • Directly building the projects • Supportive Investments — Directly investing in people • Operating and maintenance subsidies for new affordable or supportive housing • Rental assistance* • Downpayment assistance*

September 25, 2019 Workshop Meeting Packet 78 Definitions

H.B. 1406 and defined terms. • Full authority = .0146% • Half or split authority = .0073% • Participating entity — Any city or county that opts into the revenue stream is considered a “participating” city or county. • Qualifying local tax — A city that has implemented, or implements within the first year, a “qualifying local tax” is eligible to claim the full authority.

September 25, 2019 Workshop Meeting Packet 79 Qualifying local taxes

H.B. 1406 and defined terms. • “Qualifying local taxes” means the following tax sources, if the tax source is instated by a city no later than July 27, 2020 (within one year of the bill’s effective date): — The affordable housing levy authorized under RCW 84.52.105; — The levy authorized under RCW 84.55.050 if used solely for affordable housing; — The sales and use tax for housing and related services authorized under RCW 82.14.530 if the city has imposed the tax at a minimum or least half of the authorized rate; — The sales tax for chemical dependency and mental health treatment services or therapeutic courts authorized under RCW 82.14.460.

September 25, 2019 Workshop Meeting Packet 80 Definitions

H.B. 1406 and defined terms. • “Qualifying local taxes” – cities that already have one in place — Seattle (Housing Levy) — Bellingham (Housing Levy) — Vancouver (Housing Levy) — Ellensburg (1/10 of 1% sales tax for affordable housing) — Olympia (1/10 of 1% sales tax for affordable housing) — Tacoma (Mental health and chemical dependency sales tax) — Port Angeles has a sales tax on the November 2019 ballot

September 25, 2019 Workshop Meeting Packet 81 Definitions

H.B. 1406 and defined terms. • The full authority of 0.0146 percent can be reached either by a city and county each claiming half (0.0073 percent), or by one of the entities claiming the whole. • The following are the circumstances in which the full 0.0146 percent can be claimed by one of the entities: — Cities can levy the full authority • if they have levied one of the qualifying local taxes before or within the first year OR • in year one without a qualifying local tax only if a county declares they will not participate or otherwise fails to adopt a resolution. — Cities without a local qualifying tax in non-participating counties lose authority in year two due to a mistake in the bill. — Counties can levy the full authority • always in unincorporated areas and in those areas within the first year. • in the boundaries of cities that declare that they will not levy it or who do not otherwise utilize it within the first year.

September 25, 2019 Workshop Meeting Packet 82 Definitions

H.B. 1406 and defined terms. • Half or split authority = .0073% — City without a qualifying local tax takes action in year one. • This authority expires if the county does not participate by year two. — Counties can claim half within the jurisdiction of one of their cities if that city does not have a qualifying local tax.

September 25, 2019 Workshop Meeting Packet 83 Timelines and next steps

September 25, 2019 Workshop Meeting Packet 84 Timelines

H.B. 1406 and existing law include various milestones. • Resolution of Intent must be adopted by January 28, 2020. • The legislation must be adopted by July 28, 2020. • Department of Revenue requires 30-days notice of adoption of the sales tax credit and the change must occur on the first day of the month (RCW 82.14.055) — Considering the necessary actions, the earliest possible use of the funds is this fall.

• Example: August 20 adoption of sales tax credit + 30 days notice = September 20. The effective date is the first day of the following month = October 1. October taxes are sent to DOR by November 25. City/County receives the money at the end of December in its disbursement from the State Treasurer.

September 25, 2019 Workshop Meeting Packet 85 Examples and estimates

September 25, 2019 Workshop Meeting Packet 86 Example

A county stepping through the milestones, under different scenarios. • Mason County is eager and meets all requirements to start levying the credit by September 1. Shelton has taken no action. — Under (A)(II) of HB1406, Mason gets .0073% within Shelton city boundaries and under (B)(III) gets .0146% in the rest of Mason County. (The other .0073% in Shelton seems to be lost to both parties…the State wins here, it appears) • Then Shelton springs into action and passes the resolution and ordinance by January 28, 2020. They don’t have a QLT. — Starting March 1, Shelton’s tax credit is levied giving Shelton .0073%. Mason still gets its .0073% in Shelton city limits (no QLT) and .0146% in the rest of the County. • Shelton’s ballot measure on a QLT passes in February and is instated in June. Starting June 1, Shelton gets .0146%. Mason loses its .0073% from Shelton’s boundaries, but retains .0146% in the rest of the county.

September 25, 2019 Workshop Meeting Packet 87 Estimates

Estimating potential revenues. • Island County 2018 Taxable Retail Sales: $1,207,099,867 — Annual tax credit at .0073%: $88,118 — Annual tax credit at .0146%: $176,237 Pro tips • The FY2019 taxable retail sales number will be used to calculate the maximum revenue a city or county can collect. — A county should impose the tax credit before cities to ensure it gets credit for the full amount.

September 25, 2019 Workshop Meeting Packet 88 Estimates

Pledging the tax to bonds. • Island County 2018 Taxable Retail Sales: $1,207,099,867 — Annual tax credit at .0073%: $88,118 -> Bond = $1,329,000 (low end) — Annual tax credit at .0146%: $176,237 -> Bond = $2,659,000 (not achievable unless all cities in Island County declare they will not levy sales tax) • actual amounts could be a combination of the two

September 25, 2019 Workshop Meeting Packet 89 Estimates

Other community estimates. • Coupeville 2018 Taxable Retail Sales: $62,938,972 — Annual tax credit at .0073%: $4,595 — Annual tax credit at .0146%: $9,189 • Langley 2018 Taxable Retail Sales: $49,720,355 — Annual tax credit at .0073%: $3,630 — Annual tax credit at .0146%: $7,259 • Oak Harbor 2018 Taxable Retail Sales: $475,658,966 — Annual tax credit at .0073%: $34,723 — Annual tax credit at .0146%: $69,446

September 25, 2019 Workshop Meeting Packet 90 Estimates

Pledging the tax to bonds. • Coupeville 2018 Taxable Retail Sales: $62,938,972 — Annual tax credit at .0073%: $4,595 • -> Bond = $69,000 — Annual tax credit at .0146%: $9,189 • Langley 2018 Taxable Retail Sales: $49,720,355 — Annual tax credit at .0073%: $3,630 • -> Bond = $55,000 — Annual tax credit at .0146%: $7,259 • Oak Harbor 2018 Taxable Retail Sales: $475,658,966 — Annual tax credit at .0073%: $34,723 • -> Bond = $524,000 — Annual tax credit at .0146%: $69,446

September 25, 2019 Workshop Meeting Packet 91 Estimates – if cities and county cooperate

Working together to maximize the outcome.

• Island County (.0146% in unincorporated areas – does not include half credit in incorporated areas) — -> Bond = $1,363,000 • Coupeville (.0073%) — -> Bond = $69,000 • Langley (.0073%) — -> Bond = $55,000 • Oak Harbor (.0073%) — -> Bond = $524,000

Total: $2,011,000

September 25, 2019 Workshop Meeting Packet 92 Pooling Resources

September 25, 2019 Workshop Meeting Packet 93 Pooling resources

Working together to maximize the outcome. • A county or city may enter into an interlocal agreement with one or more counties, cities or public housing authorities to make the money go farther. • Benefits include: — Stretching each tax dollar to make it go farther. — Regional decision making and solutions to investing in affordable and supportive housing. — Sharing of resources, services, and cost sharing. — Unified service delivery.

September 25, 2019 Workshop Meeting Packet 94 Pooling resources

Working together to maximize the outcome.

• Chapter 39.34 RCW – the “Interlocal Cooperation Act” — Allows two or more public agencies to enter into an agreement for joint or cooperative action • The interlocal agreement may include but is not limited to: — Method for pooling tax receipts. — Pledging tax receipts to bonds issued by one or more parties to the agreement. — Allocating the proceeds of the tax levies or the bonds to a joint or regional project.

September 25, 2019 Workshop Meeting Packet 95 Pooling resources

Working together to maximize the outcome. • The interlocal agreement should specify: — Its duration; — whether a new agency is formed; — Its purpose or purposes; — the manner of financing the joint or cooperative undertaking and of establishing and maintaining a budget; — the permissible method or methods to be employed in accomplishing the partial or complete termination of the agreement and for disposing of property upon such partial or complete termination; and — any other necessary and proper matters • Approved by ordinance, resolution or motion of the legislative authorities • Either filed with the county auditor or posted on a public agency’s website or other electronically retrievable public source

September 25, 2019 Workshop Meeting Packet 96 Final takeaways and questions

September 25, 2019 Workshop Meeting Packet 97 Next steps and resources

Next steps – two step process to impose the tax

• Keep an eye out for FY2019 tax figures and additional information and updates from Department of Revenue • Department of Commerce is engaged in rulemaking regarding the annual reporting required by HB 1406. Commerce expects the annual report will be due each October 1. • Engage your partners — Neighboring jurisdictions, housing authorities, cities, and nonprofit providers • Other Resources — Washington Low Income Housing Alliance (www.wliha.org/resources/webinars-and-tools) — Washington State Housing Finance Commission (www.wshfc.org)

September 25, 2019 Workshop Meeting Packet 98 Questions

Contact information:

Faith Pettis, Partner Pacifica Law Group LLP [email protected]

Jon Jurich Partner, Pacifica Law Group LLP [email protected]

Articles and today’s training are for informational purposes and do not provide legal advice. These materials are not intended to be used or relied upon as legal advice in connection with any particular situation or facts. 29

September 25, 2019 Workshop Meeting Packet 99 City of Oak Harbor Date: September 25, 2019 City Council Subject: City Administrator's Report Workshop Agenda Bill

FROM:Blaine Oborn, City Administrator

SUMMARY STATEMENT City of Oak Harbor Mission Statement: The City of Oak Harbor is committed to creating a vibrant community by delivering quality services, enhancing the quality of life, and fostering economic opportunities. The following is the City Administrator’s Report to City Council to be presented at the September 25, 2019 workshop: ADMINISTRATION Legislative Outreach: Continue ongoing discussions with State and Federal representatives. Met with Representative Rick Larsen, Mayor Severns, and Navy Leadership on September 13. Arts Commission: Continue working on drafting the interlocal agreement between the City and OHSD for the Sculpture Park. Continue working with the Arts Commission to develop an RFP for the Acorn Sculptures Project. Arts Commission to advocate specific art pieces and art placement as part of the Windjammer Phase 2 Scoping process. Continue working on completing the Autumn Winds landscaping and lighting. Main Street: Update on design guidelines and Central Business District code review to be provided as specific item at this workshop. Continue to work on locations for Main Street Entrance signs currently being stored at Public Works. Continue to work on highway directional signage. City Administrator continues to attend and support the OHMSA Design Committee and the OHMSA Economic Vitality Committee. Community Support: City Administrator continues serving on the Chamber’s Legislative Affairs Committee and is providing input and support for the Chamber’s Legislative Priorities regarding 1) Workforce Housing, 2) Trespass and Safety, 3) Transportation, and 4) Communication. See attached Mayor’s Snapshot dated August 30, 2019 provided to the Chamber of

September 25, 2019 Workshop Meeting Packet 100 Commerce and posted on the City’s website. Greeted school children at Home Connections on September 9 and Hand-in-Hand Early Learning Center on September 16. Attended the Community Leadership Forum hosted by the Secretary of the Navy with Mayor Severns on September 20. Economic Development: Continue promotion of Opportunity Zone. Broadband Backbone Proposal: Completed Inter-Local Agreement (ILA) with Coupeville Port Authority committing $5,000 from the Economic Development Budget to help with the $50,000 Broadband Feasibility Study Grant. Anacortes Wet Fiber: Working on ILAs with the City of Anacortes for: 1) Installation and sharing of wet fiber in City of Oak Harbor’s large waterline from Sharps Corner to the Deception Pass Bridge, and 2) Installation of wet fiber in City of Oak Harbor’s large line from Deception Pass Bridge to Alt Field Water Tank Reservoir. Both will initially be used for waterline only projects to provide security, leak detection and telemetry communication. There will be the option of activating broadband in the future. Conferences: Attended the WCMA Annual Conference in Kennewick, WA August 13 – 16. Attended the AWC Municipal Budget and Finance Management Conference in Leavenworth, WA August 22 – 23, along with Finance Director and Councilmember Servatius. DEVELOPMENT SERVICES Streamlining the Development Review Process: Attached is the Kaizen Lean Report from the Office of the Washington State Auditor, Center for Governmental Innovation, on the Site Plan Review Process for your review in advance of an extensive update at the October 23 Workshop. Staff have already implanted three of the recommendations as described in Proposal #1: 1) Weekly Unified Review Meeting combining three previous meetings, 2) Restructure the Unified Review Meeting to be facilitated by the Project Manager (Planner), and 3) Technically Complete Review. More information to come on the goals and other proposals. JPA / UGA Meeting with Island County: City Administrator, Mayor Severns, and Development Services Director will be meeting with the Island County Board of Commissioners on Wednesday, October 2, at 9:00 AM. Council has been invited to the meeting and Notice of Attendance has been posted should a quorum of Councilmembers attend. Historic Preservation Commission (HPC): Continue to promote the Special Property Tax Valuation for Historically Certified Places. Historic Preservation Commission Code Amendment is a separate agenda item at this workshop. MARINA The marina continues to increase occupancy year after year and this summer hit a new high of 96%. In order to attract bigger boats, 35 of the 52 F dock slips are being converted to permanent moorage. Project and grant work continues to move forward with feasibility studies starting in the near future.

September 25, 2019 Workshop Meeting Packet 101 FINANCE DEPARTMENT Continue working on ExecuTime implementation with target start date of January 1, 2020. Finance Director attended the AWC Municipal Budget and Finance Management Conference in Leavenworth, WA August 22 – 23. Finance Director and Department staff attended Washington Finance Officers Association 64th Annual Conference September 17 – 20 in Yakima, WA. FIRE DEPARTMENT Continuing the Vehicle Exhaust System installation. Fire Department participated in Military Appreciation Picnic on September 7 with the repaired Ladder Truck. HUMAN RESOURCES With the adoption of the PD Non-Commissioned Officers Unit Labor Agreement at the September 17 Council Meeting, all of the labor agreements are now good through December 2020. POLICE DEPARTMENT Working on filling the authorized officer positions: Hired two entry-level recruits who will be entered into the first available training academy, which starts on December 4, 2019. The recruits began pre- training on September 16th. PUBLIC WORKS Clean Water Facility: See attached monthly financials, along with Windjammer Park financials. Continue to work with Navy regarding connection and rate negotiations. Continue negotiations on the Harbor Heights property purchase for the proposed Regional Park. SENIOR SERVICES Member appreciation lunch Thursday, September 26 at 11:30 AM, Council members are invited to join! Resource Fair: Saturday, September 28 from 9:00 AM to 1:00 PM which will feature over 25 community vendors, flu shots will be available, and free lunch sponsored by La Conner Retirement Inn and free espresso bar sponsored by Edward Jones Jeffery Pleet. Carpet replaced in living area of modular building with funds donated from Island Senior Resources and Northwest Regional Council on Aging. Annual Fundraiser: Fanciful Fall Wearable Art Runway Show and Dinner Saturday, October 26.

ATTACHMENTS

September 25, 2019 Workshop Meeting Packet 102 1. Mayor's Snapshot 08/30/2019 2. Kaizen Lean Study Report 3. August 2019 CWF Financial Report 4. August 2019 WJP Financial Report

September 25, 2019 Workshop Meeting Packet 103 Mayor’s Snapshot: August 30, 2019

• As part of the workforce housing initiative, the City Council has started the process of petitioning the County to expand the Joint Planning Area (JPA) and reviewing the City's Comprehensive Plan. To discuss these issues, a Joint Special Workshop Meeting of the City Council and City Planning Commission is scheduled for Monday, September 16, 2019 at 6:00 p.m., with public input welcome. • On August 28, 2019, the City Council enacted a six-month partial moratorium on building permit applications or land use applications for any development within the City's Central Business District (CBD, downtown) containing ground floor residential and any mixed-use development that does not contain a minimum of 33% commercial space. As part of this issue, the City Planning Commission is reviewing Oak Harbor Main Street recommendations for Design Guidelines updates and Planning Ordinance changes. The next discussion by the Planning Commission is scheduled for Tuesday, September 24, 2019 at 6:00 p.m., with input from the community welcome and encouraged. • City voters are encouraged to become informed on Proposition 1, on the November 5, 2019 ballot, to increase the local sales tax by 0.2% to fund local road improvements. Visit www.oakharbor.org/tbd for more information. • I continue to go on record in full support of the Navy and in agreement that “Jets = Jobs”. • In a cooperative effort with the Oak Harbor School District, the City has completed a new mid- block crossing to improve safety at the Oak Harbor Intermediate School. • September is National Senior Center Month with thanks to all those who support our local center. • The City's Police Department had officers doing extra patrols in the downtown, parks, and waterfront for the summer with great response and appreciation from the community. • The City of Oak Harbor’s Clean Water Facility project has been selected by the American Public Works Association (APWA) for “Project of the Year” in the Environment category for total project of more than $75 million. Appreciation goes to staff, contractors, and the community for support of this state-of-the-art facility being honored yet again.

September 25, 2019 Workshop Meeting Packet 104 July 23, 2019

From: Debra Hentz, Lean Specialist, Center for Government Innovation

To: Blaine Oborn, City Administrator

Introduction: This report is provided by the Center for Government Innovation from the Washington State Auditor’s Office to the City of Oak Harbor as a brief summary of the Lean kaizen event performed in July of 2019 with members of the Development Services and Public Works Engineering teams. The kaizen focused on increasing efficiency in the Type II Site Plan Review process while simultaneously learning about Lean methodology. The decision was made to keep the scope of this kaizen contained within the two departments, therefore other team members such as Police and Fire did not participate.

The facilitator, Debra Hentz, is the Lean Specialist for the Center for Government Innovation within the Washington State Auditor’s Office specializing in Lean methodology training and process improvement facilitation. Prior to joining the State Auditor’s Office in January 2014, Debra spent 5 years with Clark College Student Affairs in Vancouver, WA, and 20 years at the Hewlett Packard Company as an Engineering Manager in the areas of product design, lean manufacturing, and worldwide operations. Her primary areas of concentration included project management, continuous process improvement and leading change initiatives. Debra holds a Master of Public Affairs degree from Washington State University and a Bachelor of Science degree in Mechanical Engineering from The University of Texas at Austin.

The mission of the Office of the Washington State Auditor is to provide citizens with independent and transparent examinations of how state and local governments use public funds, and develop strategies that make government more efficient and effective. The results of our work are widely distributed through a variety of reports, which are available on our Web site and through our free, electronic subscription service. We take our role as partners in accountability seriously. We provide training and technical assistance to governments and have an extensive quality assurance program. For more information about the Office of the State Auditor, visit www.sao.wa.gov.

cc: Emma House, Human Resources Director

September 25, 2019 Workshop Meeting Packet 105 Purpose for this Lean work as captured in the Charter Document dated February 2019: Selecting Type II Site Plan Review Process for this first kaizen was a priority due to the heightened community and City Council interest in development review and permit issuance process. The process was not well understood by the community or the City Council. Additionally, at times applicants struggled with understanding the various permit steps and requirements. The cost of the current state to the organization is intangible (e.g. City reputation) and tangible (e.g. incomplete applications lead to staff inefficiencies). As a side note, the imposition of mandatory low impact development techniques for storm water management has greatly complicated this process.

The Sponsors created two goals to be accomplished during the kaizen week: 1. Improved communication between staff with the goal of each discipline understanding, to the highest possible degree, the needs and concerns of the other disciplines. 2. Identifying and implementing a manner to better communicate the requirements of the process to the public and City Council. Lean kaizen methodology begins by understanding current state process steps in detail. This concept of going slow to go fast is the key to each discipline understanding their partner’s world (beyond their daily view) and then identifying how each member of the team contributes to an overall efficient process flow. The kaizen team works together to identify those unnecessary steps in the current process (such as duplication or inconsistency in approach) as well as creating new guidelines for improving customer service (focus being from the customer’s perspective, not the internal staff viewpoint). At the end of the kaizen, the team meets with the Sponsors to present their work and ask for approval for the team to lead the proposed improvement changes, which is meant to be less about what management needs to do and more about what the team members can change within their control.

The Charter document also included three targets that shared Sponsor priorities for the future state as a guide for team proposal creation: 3. A high percentage of site plans approved after the original submittal plus one revised submittal. 4. A higher percentage of complete applications submitted to the City. 5. 95% of site plans approved within 120 day review timeframe. Since there is little to no current state data on these specific metrics (kaizen relied on anecdotal stories), future state targets were accepted as estimations based on benchmarking from other local governments performing the same process. They are goals for the team and will need a data tracking system established to know whether they are being met or not.

Structure of the Kaizen performed on July 15th to the 19th Executive Team Sponsors: Mayor Bob Severns (Strong Mayor) & Blaine Oborn (City Administrator) Director Level Sponsors: Steve Powers (Development Services) & Cathy Rosen (Public Works) Subject Matter Experts on the Kaizen Core Team:  Public Works: Jim Bridges, Brad Gluth, Craig Taylor, Alex Warner  Development Services: Lisa Bebee, Cac Kamak, Scott King, Ray Lindenberg Subject Matter Experts on Call (attended when requested by the facilitator):  Emma House, Human Resources Director Work was done in 6 hour days, providing time for the team to keep up with urgent issues and have time to reflect on new thinking. Most of the work was done as a full kaizen team; however each department had the opportunity to work separately with the Lean facilitator with the specific purpose to express their thoughts and needs without impact or judgement from the other department team members.

September 25, 2019 Workshop Meeting Packet 106 Executive Summary: Key take-away from the Lean kaizen was that the City of Oak Harbor is growing. Hearing about new permit applications as well as several projects that are in the final stage indicates the City is in the midst of transforming from a small town, with a variety of organizational challenges, into a mid-sized city that will be another economic development hub for the greater Seattle and Olympic Peninsula areas. With that transition understood, there is tremendous need and good potential for the permitting process to improve. Kaizen week was focused on Type II permits as the most common, but improvements proposed will help all permit types as well as other work performed by the two departments. As noted in the Charter targets, a key goal was to introduce Lean methodology to the City staff, beginning the journey required to become the high-performing organization envisioned by the Sponsors.

Given the City’s potential, no one should underestimate the work ahead. Current state mapping uncovered a major deficit in technology tools for submitting, tracking and reviewing project documentation as well as customer self-service options common in many other cities this size. A second major problem was the challenge for some team members to let go of past problems so they can open their thinking to create new process policies and steps. Unfortunately, one key team member, with seniority and strongest voice, struggled throughout the week (including the final day) to embrace the fact that change needs to come from the team and subject matter experts, rather than from City Executives. Other team members did embrace that idea of positive change coming from their ability to identify their key needs, then asking how they can help improve the daily work of other team members (internal customers); ultimately negotiating a better future state for everyone including external customers. The process improvement work needed in Oak Harbor will take a skilled management team and the ability for respected technical experts to guide other team members into the future state by defining incremental improvement steps, rather than wishing for big leaps done quickly by upper management. It is vital that the team successfully implements Kaizen Proposal #1 which includes more focus on the Site Plan Application being Technically Complete, improving the structure and facilitation of their weekly team meetings, and respecting the new role of Project Manager (aka Planner) from start of application to finishing the project with a Certificate of Occupancy (a project coordination, customer facing, and team facilitation role only, not supervisory or multiple-discipline expertise).

SAO Lean Specialists offers assistance during this work if it is requested by the City Executive Team with the understanding that we provide training, facilitation, and assessment services only. Lean methodology requires the organization (sponsors and staff working together) to create improvement proposals, make decisions, and lead implementation of change initiatives.

Kaizen proposals and first action steps:  Proposal #1 = request approval for the team to implement: o Consolidate three different meetings into one Unified Weekly Team Meeting to be done on Tuesday mornings. Everyone blocks Tuesday from 9am until noon on their calendars so that time is always available. The team agrees to meet only for the time that is value-add; not to fill the reserved meeting time. Individual staff may choose to dig into necessary details after the main meeting agenda, but not keep the entire team sequestered in the meeting room. o Restructure the Unified Weekly Team Meeting to be facilitated by the Project Manager (Planner) with an agenda created by that Project Manager and Permit CD working together. For most permits, this Project Manager is Ray Lindenberg.

September 25, 2019 Workshop Meeting Packet 107 o Increase the importance and departmental partnership of the Technically Complete review step. Provide better information earlier in the process to benefit primarily the applicant (customer) as well as the reviewers (better first look should decrease the number of subsequent reviews). This includes the ability to reject the application at this early point. o Lisa Bebee (Permit CD) to distribute application paperwork and plans at the meeting rather than in mailboxes allowing the team to align on project clarity and time management real- time. Also, team members mentioned the added benefit of receiving paperwork earlier. o Lisa to schedule any Applicant-Staff meetings as the first item on the agenda. o Extend the goal for completing the first full plan review to 6 weeks from the current 4 weeks. Again, a more complete first review up-front will reduce the number of resubmittals, provide the customer more information sooner, and reduce the number of multiple touches on the same project (less revision reviews). Proposed timeline for future states shows the 120 day target should work well for all but the exceptions to standard process. o Better Technically Complete reviews with the new 6 week review window is expected to provide the team more focused review time and dramatically reduce the resubmitals. o Team commitment made to be proactive to Lisa’s project deadlines; need to reduce the time she requires to collect comments from review team members. Next step will be for the team members to get more comfortable placing their comments directly into the document template that will be located in a shared space. o Action Items: . Lisa to update calendar appointments starting in about 2 weeks AND to transition new requests for applicant-staff meetings to the new day. Also, make any adjustments needed to logistics such as room location and/or technology needs. . Ray to take the lead coordinating with Lisa and Steve to make the changes needed. Then take the lead on facilitating the meetings. . Ray can reach out to Emma in HR and/or Debra at SAO if any mentoring is needed. . Ray to capture summary “Lean Check-In” in about 60 days and report to Debra as part of the SAO kaizen service (PDCA).

 Proposal #2 = request of the Directors: o Considering Proposal #1 is a major change to team thinking and daily work, the team asks that other process improvements discussed during the kaizen, such as changes to the Pre-App Meetings, increasing staff member focus time, and developing new process tools, be placed on hold until Proposal #1 changes are realized. o Rather than a standardized staff-focus-time for all, staff prefers to have one-on-one agreements with their manager regarding how and when to gain more focus. Some will be able to shut their door while others may use headphones AND there needs to be flexibility where some want focus on a consistent schedule and others want to ask for specific times of project need. o The team needs a Shared space for project documentation to be stored in one central location. Currently every team member keeps documents on their individual computer (including email communication) and Lisa maintains the master electronic and paper files. This is not only duplication waste, but causes confusion about whether an individual is viewing the most up-to-date version of a document. The challenge is not simply the shared folder location, but moreso the process for how the team members use it (e.g. naming convention, revision updates, access limitations).

September 25, 2019 Workshop Meeting Packet 108 o Action Items: . Emma and Craig to work on getting the shared folder established. . Craig and Ray to lead the process work required for the new shared location – e.g. naming convention, who can post, what to post . Emma, Craig, or Ray can reach out to Blaine and/or Debra if help is needed.

 Proposal #3 = request of the Executive Team: o Need development standards (primarily for civil plan review) so that the team and managers are aligned with what is acceptable and clarity is improved regarding expectations to explain to applicants. There was confusion in the final kaizen discussion about what is already created as civil plan design standards versus the need to develop the standards from scratch. Therefore, the first step is to create the plan for how to approach the need for standards (e.g. determine current state, benchmark with other cities, align across staff and management). o Ability for the Subject Matter Experts to say “no” (aka rejecting submittals in a supportive and polite way) to substandard and incomplete documentation. Request for Executive Team to listen to complaints they receive, but not respond until they get the other side of the story from staff members. Staff suggested a standard response of “I hear you and I would be glad to check into that for you” and then contacting the Subject Matter Expert or their manager to get the internal City story BEFORE responding to the complaint. All parties agreed that alignment between staff and management are much better today than a few years ago. o Recommendation to review code for alignment with current and future process elements. Belief that parts of code are outdated and that other new agreements might need to be added to code. At that same time, suggest a review of the permitting fee structure (e.g. are current charges appropriate and do they support the desire outcome? do you want to add fees for multiple inquiry requests? are you rewarding good applicant behavior?) o Action Item: . Jim and Brad to create the PLAN for how to get design standards created and the process for input as well as agreement from other team members. . Jim to determine if any help is needed from Executive Staff – then to reach out to Blaine as required. . Jim can also reach out to SAO for more Lean methodology guidance if necessary.

Key Lean Principles to remember:  Standardization increases efficiency and provides the ability to track progress. One example for improvement would be agreement on responses to incomplete or substandard applications, both Counter Complete and Technically Complete.  Value-Add work based on Customer Need that they are willing to pay for (not just ask for). One example for improvement is alignment of expectations by the Executive Team about the amount of time spent on potential project inquiries versus focus time for submitted project plan review (especially from non-owners, appraisers, & real estate agents).  Form Follows Function is always understanding the purpose of a process or process step before designing the structure. For instance, before making any changes to the Pre-App Meeting, start by determining the primary purpose. Is it to recover City cost or to encourage future applicants to get early information or for staff to push desk inquiries into a meeting format?

September 25, 2019 Workshop Meeting Packet 109  Decisions and independent work done at the lowest possible level not only helps the efficiency of the team, but allows staff to build skills so they continue to contribute at a higher level which builds a high-performing organization. Having the Project Manager facilitate team meetings and determine agendas and shared project documentation space speaks to this principle. Also, there were anecdotal stories about multiple team members required for most Engineering determinations. There should be awareness and clarity about what younger, more inexperienced staff members can determine on their own, building individual confidence and team efficiency.  Eliminating Waste is the foundational Lean principle. Your world is similar to most permitting Lean work I’ve done, waste is most often seen in multiple communication loops due to the lack of clear information provided by the applicant at the start of the process. Better information at the start of any process provides faster processing time and more outcome expectations being met. However, Oak Harbor is the exception, in my experience, for not having established a shared documentation process, including both the method for capturing reviewer comments and storing documentation versions. The foundation for this process change can be established now by management understanding the current state and amount of overhead work done by Lisa.  System Thinking means that we look at how everything in the system depends on each other and working together. A good example from this kaizen is how regulations change and yet are not understood by the applicant which requires time for the Planners to learn and apply the updated regulations AND for everyone in the City management team to help educate the public to things beyond your local government control. Also, both teams awareness of how their work and behaviors impact the other department staff.  Small Controlled Changes done overtime create large improvements in process efficiency and staff effectiveness. Lean is all about BALANCE = big change done quickly is risky to the organization and difficult for staff to implement; however, getting stuck in the past without trying new ideas for improvement stagnates the team and impacts customer satisfaction over time. Lean methodology likes continuous change done in a PDCA (Plan-Do-Check-Adjust) approach. The staff gets more comfortable with change and eventually gains the skill necessary to expect change before it happens, thereby smoothing out the cycles of stress that is often passed onto the customers which causes increased complaints to management.

Observations of the Lean Facilitator for Management to Consider: o What the team members had in common = a sense of frustration in each other and with members of the executive team in what was described as lack of trust that what was said in one situation will not be true in the next similar situation. This lack of standard expectations can be the root cause for many other staff complaints. There was unified agreement that no one was allowed to tell a permit applicant that they were being rejected for lack of information and that any question or inquiry (on phone or in person) demanded they stop whatever they are doing to respond instantly creating a defensive position for the staff member. Knowing what I heard from the administrative sponsors, I can only assume this was created by past experiences building a culture that is in the process of changing for the better with the new leadership team.

o Differences among the kaizen team members = . there was a clear distinction between the two departments and their approach to daily work: Development Services having a more individual approach to their roles versus Public Works Engineering explaining their need for group discussions and multiple eyes to make decisions. It was also Public Works staff who continued to share how their

September 25, 2019 Workshop Meeting Packet 110 multiple roles of development reviews combined with their responsibility to assist with infrastructure maintenance impacts their ability to focus on their primary role (e.g. multi- tasking dramatically impacts review efficiency). Finding a way to provide the Engineering staff with more focus time would enable the team to achieve the Charter document targets. Clarifying roles and responsibilities across the Public Works team might help staff members determine when and where they need to get involved without the fear of being criticized for non-participation. . There were also differences seen within the departments regarding individual staff member’s comfort level with future thinking and change. No one was against making things better, rather certain team members began seeking out new ideas for improvement as the week progressed while others continued to verbalize why a particular idea was troublesome before considering the advantages or hearing the details required to enable the change. There is a clear role that is needed on a team for those staff members who resist change to make sure group-think is avoided and change doesn’t happen too fast without consideration of the underlying problems. However, if that resistance is too quick or too strong without equal balance in an optimistic perspective, then all change, even small, progressive change, will not occur and the organization becomes frozen in time. Identifying change agents within the organization and giving them management support and authority, while making sure to include all staff input, often helps organizations find the right balance for progress and, simultaneously, builds the organization’s internal leadership pool. o This kaizen was a great first step. The outcome of the week may seem small in process improvement proposals, but the leap of faith by the team to try Lean methodology should not be minimized. Leadership needs to . assure success in the three proposal implementations and celebrate the team’s achievement (celebration for improvement is the role of the Sponsors). . determine where the next priority lies for Lean training and process improvement. Growing the circle of Lean experienced staff members is crticial to gaining internal momentum for subject matter experts to believe they can make change at their level with management approval, rather than requiring management direction. . consider some parallel training in communications and teamwork skills. As one example, SAO offers StrengthFinders facilitation which helps individuals realize that different team members see the world through a different lens AND that high-performing teams need those different qualities to achieve excellence. An organization never wants a whole team of one skill strength. Individual team members need to understand what they contribute to the team as a whole and respect others for strengths they do not have.

September 25, 2019 Workshop Meeting Packet 111 CLEAN WATER FACILITY PROJECT FINANCIAL REPORT

Summary Through 08/31/2019 (before year end accruals)

REVENUE FUNDING OBTAINED FUNDING USED BALANCE SRF LOANS 97,983,466.00 97,983,466.00 - BONDS 25,777,229.30 25,777,229.30 - GRANTS 8,500,000.00 8,255,000.00 245,000.00 PROGRAM INCOME 15,679,740.54 13,984,985.23 1,694,755.31 REET 2 100,000.00 100,000.00 - CUMMULATIVE RESERVE 5,000,000.00 5,000,000.00 - TOTAL REVENUE 153,040,435.84 151,100,680.53 1,939,755.31

CONTRACTED/ESTIMATED PROJECT TO DATE EXPENDITURES BALANCE BUDGET ACTUAL ACQUISITIONS 3,396,325.69 3,401,028.67 (4,702.98) ADMINISTRATION 692,852.01 651,745.11 41,106.90 CONSTRUCTION 124,222,645.68 122,721,355.41 1,501,290.27 FINANCE 258,638.16 291,733.92 (33,095.76) PROFESSIONAL SERVICES - DESIGN 9,447,726.92 9,251,614.22 196,112.70 PROFESSIONAL SERVICES - CONSTRUCTION 11,209,769.69 10,970,425.51 239,344.18 TOTAL PROJECT EXPENDITURES 149,227,958.15 147,287,902.84 1,940,055.31 CASH SURPLUS (DEFICIT) 3,812,477.69 3,812,777.69 (300.00)

FINANCING/TRANSFERS BONDS 2,776,377.50 2,776,677.50 (300.00) LOANS 586,100.19 586,100.19 - TRANSFERS- WINDJAMMER PARK - DESIGN 450,000.00 450,000.00 - TOTAL FINANCING/TSFR 3,812,477.69 3,812,777.69 (300.00)

ESTIMATED CASH REMAINING 0.00 - 0.00

Prepared by Patricia Soule, Finance Director

September 25, 2019 Workshop Meeting Packet 112 City of Oak Harbor, WA

WINDJAMMER PARK IMPROVEMENTS PROJECT

Spent to Date thru Revenue Project Budget 08/31/19 Balance Cash 408,120.30 408,120.30 - Beginning Fund Balance 380,735.19 380,735.19 - Donations 1,594.04 1,594.04 - Interest Allocaiton 25,791.07 25,791.07 - Transfers 11,628,833.47 11,291,416.28 337,417.19 001 - General Fund 1,828,768.65 1,828,768.65 - 126 - Comm Park Impact Fees 264,739.85 264,739.85 - 127 - Park Impact Fees 300,660.00 103,243.00 197,417.00 311 - REET 1 1,526,929.00 1,526,929.00 - 312 - REET 2 523,070.16 383,069.97 140,000.19 422 - Clean Water Facility 7,184,665.81 7,184,665.81 - Grants 1,426,320.00 1,426,320.00 - WA State Legislative Grant 727,500.00 727,500.00 - Isand County RCED Grant-Pavillion 698,820.00 698,820.00 - Total Revenue 13,463,273.77 13,125,856.58 337,417.19

EXPENDITURES Project Budget Spent to Date Balance Administration 392,348.19 349,596.79 42,751.40 IDCA 392,348.19 349,596.79 42,751.40 Construction 11,328,253.25 10,807,682.41 520,570.84 Demolition 9,999.98 8,872.63 1,127.35 Utilities 10,000.00 334.36 9,665.64 Miscellaneous 139,514.26 17,898.40 121,615.86 GMP13 - Hoffman-GF 6,485,578.30 3,196,120.66 3,289,457.64 Hoffman-CWF 4,630,337.00 6,072,764.29 (1,442,427.29) Hoffman-Grants - 1,426,320.00 (1,426,320.00) Const & Imp - PSE-Schedule 52 & PO's 52,823.71 36,314.36 16,509.35 Other 49,057.71 (49,057.71) Preliminary Engineering/Planning 50,000.00 - 50,000.00 Scoping 50,000.00 50,000.00 - -

Prof. Serv. Con. 243,219.30 223,740.86 19,478.44 Archaeology ERCI-CWF 128,400.80 114,273.77 14,127.03 Public Outreach - Chamber of Commerce Phase 1 7,699.00 4,721.90 2,977.10 Chamber of Commerce Phase 2 2019 18,764.50 18,764.50 Chamber of Commerce Phase 3 2019 13,855.00 13,855.00 Enviroissues-CWF 33,000.00 27,563.75 5,436.25 Other 1,500.00 13,304.27 (11,804.27) Construction Engineering - Carollo-GF 20,000.00 31,938.56 (11,938.56) Carollo-CWF 20,000.00 31,938.61 (11,938.61) Construction Management - Open - - Prof. Serv. Design 1,431,143.00 1,029,018.24 402,124.76 Design - - Carollo-GF 427,780.36 367,604.23 60,176.13 Carollo-CWF 427,780.37 416,352.18 11,428.19 Other 337,417.00 337,417.00 Permits 156,000.00 162,540.01 (6,540.01) Public Outreach - Carollo-GF 37,082.64 37,082.64 - Carollo-CWF 37,082.63 37,082.63 - Other 8,000.00 8,356.55 (356.55) Total Expendiutes 13,444,963.74 12,410,038.30 1,034,925.44 Surplus (Deficit) 18,310.03 715,818.28 (697,508.25)

September 25, 2019 Workshop Meeting Packet 113