MEMORANDUM

Form revised October 16, 2006

2008 BUDGET LEGISLATION FISCAL NOTE

Department:	Contact Person/Phone:	DOF Analyst/Phone:
Fleets and Facilities	Charlie Heffernan, 233-5069	Jan Oscherwitz 684-8510

Legislation Title: AN ORDINANCE related to parking lot management agreements between The City of Seattle and the Pike Place Market Preservation and Development Authority; authorizing the execution of said agreements; and directing the deposit of revenues into the Cumulative Reserve Subfund, Unrestricted Subaccount.

Summary of the Legislation: This legislation authorizes the Director of the Fleets and Facilities Department to enter into an agreement with the Pike Place Market Preservation and Development Authority (PDA) for management and operation of certain parking lots at City-owned properties in the vicinity of the Pike Place Market, commonly known as the "Desimone/PC-1 North Lot” and the “Blanchard and Lenora Lots." The term of the agreement is three years. The legislation also directs the City's portion of revenues from the agreement to be deposited into the Cumulative Reserve Subfund, Unrestricted Subaccount. Per the agreement, the City will forgo its share of revenues in 2008 to support planning for the renovation of the Pike Place Market.

Background: (Include brief description of the purpose and context of legislation and include record of previous legislation and funding history, if applicable):

Since the 1980s, the City has entered into successive agreements with the Market PDA for management and operation of parking lots at several City-owned properties near the Pike Place Market, and has shared a portion of the revenues with the Market PDA. The most recent agreement was entered into in 2001, and was due to expire at the end of 2008. In 2007, the lots are expected to generate about $400,000 of which the City’s share is about $185,000.

Earlier this year, the City received a request from the Market PDA to allow it to retain the City’s share of 2008 revenues from the parking lots to fund the Market PDA’s upcoming renovation planning and feasibility efforts in support of a potential levy in 2008. In considering this request, the Executive determined it was in the City’s and the Market PDA’s best interests to renegotiate, rather than amend, the existing agreements in light of the anticipated safety and mobility improvements to the Alaskan Way Viaduct, which would require the City to use portions or all of the parking lots beginning as early as October 2008. On July 3, 2007, the City sent the Market PDA a termination notice and established a working group of staff from DOF, FFD, Law, and the Market PDA to negotiate a new agreement.

The new agreement has a term of three years and obligates the Market PDA to remit to the City the same percentage of revenues generated from the parking lots as required in the 2001 agreement (35% of the revenues from Desimone/PC-1 North and 45% of the revenues from the Blanchard and Lenora lots), except for 2008 only, when the Market PDA will retain the City’s portion of anticipated revenue to pay planning costs incurred for anticipated renovations to the Pike Place Market. The agreement also states the City’s intent to seek compensation from the Alaskan Way Viaduct project should the Market PDA lose revenues due to the use of the lots by the project. Finally, the agreement states that should the City need to terminate the agreement in whole or in part due to the Alaskan Way Viaduct project, the City will support the development of replacement parking for the Market, to mitigate the loss of use of the parking lots.

Please check one of the following:

____ This legislation does not have any financial implications. (Stop here and delete the remainder of this document prior to saving and printing.)

__X__ This legislation has financial implications. (Please complete all relevant sections that follow.)

Summary of Changes to Revenue Generated Resulting From This Legislation

Fee Type

2007 Adopted

2008 Proposed

Total of New Revenue Proposed

Concession Agreement

$185,000

($191,000)

Total Fees and Charges Resulting From Passage of This Ordinance

$185,000

($191,000)

NOTE: At the time the 2007 Adopted and 2008 Endorsed Budget was approved by Council, the City anticipated $191,000 in revenues from the Market PDA parking lots in 2008, which was assumed in the CRF-Unrestricted Subaccount. The Mayor’s 2008 Proposed Budget does not assume these revenues. Notwithstanding impacts from the Alaskan Way Viaduct project, City revenues in 2009 and 2010 are assumed to be approximately $196,000 and $202,000 respectively.

What is the financial cost of not implementing this legislation?

The City terminated the existing parking agreements with the Market PDA as of December 31, 2007. If this legislation is not implemented, the City would need to establish a different agreement with the Market PDA for 2008 and beyond or find another operator to manage the parking lots. If the City were to continue its parking agreement with the Market PDA under the same terms as the existing agreement, the City would receive approximately $191,000 in revenue in 2008; however, it would not be providing support to the Market for renovation planning.

What are the possible alternatives to the legislation that could achieve the same or similar objectives?

The City could provide direct support to the Market PDA for levy planning in 2008 through the General Fund.

· Is the legislation subject to public hearing requirements? (If yes, what public hearings have been held to date) No.

· Other Issues (including long-term implications of the legislation): N/A.