Report - 2022 02 22 A29904 D243595 Bill Report 1173 S2 Sbr Bfst Ta 22

Summary

A Senate Bill Report on 2SHB 1173, an act relating to state lands development authorities, as of February 17, 2022, prepared for the Senate Committee on Business, Financial Services & Trade. It reports that the bill passed the House 81-15 and gives background on the Interbay Public Development Advisory Committee and the 25 acre Interbay property owned by the Department of the Military. The summary of the bill describes State Lands Development Authorities that may be formed in counties with a population of 2 million or more, and creates the Ballard-Interbay State Lands Development Authority. It covers the board of directors, the powers of an Authority, a report due by December 1st of each even-numbered year, and an account in the state treasury. The report closes with a staff summary of public testimony from the 2022 regular session.

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Full text

                            SENATE BILL REPORT
                                 2SHB 1173

                                     As of February 17, 2022

Title: An act relating to state lands development authorities.

Brief Description: Concerning state lands development authorities.

Sponsors: House Committee on Capital Budget (originally sponsored by Representatives Berry,
    Frame, Dolan and Lekanoff).

Brief History: Passed House: 2/9/22, 81-15.
     Committee Activity: Business, Financial Services & Trade: 3/16/21, 3/18/21 [DP-WM,
         w/oRec]; 2/17/22.


                                     Brief Summary of Bill
           • Authorizes the establishment of State Lands Development Authorities in
             counties with a population of 2 million or greater to oversee and manage
             the development or redevelopment of state-owned property within or
             adjacent to manufacturing industrial centers.
           • Authorizes the establishment of the Ballard-Interbay State Lands
             Development Authority.


SENATE COMMITTEE ON BUSINESS, FINANCIAL SERVICES & TRADE

     Staff: Kellee Gunn (786-7429)

     Background: Interbay Public Development Advisory Committee. In 2018, the Capital
     Budget established the Interbay Public Development Advisory Committee (Committee) to
     make recommendations on future economic development uses of the Interbay property.
     The Interbay property is a 25 acre parcel of land currently owned, fee simple, by the
     Washington State, Department of the Military. The Committee sought recommendations
     with the highest public benefit, rather than a return on investment. The recommendations




     This analysis was prepared by non-partisan legislative staff for the use of legislative
     members in their deliberations. This analysis is not part of the legislation nor does it
     constitute a statement of legislative intent.

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     were published in a report in November 2019.

     Under the deed, transferring the Interbay property from the United States to the state of
     Washington, must be for National Guard purposes only and the state will not sell, lease, or
     otherwise dispose of any of the premises without first obtaining written authorization of the
     United States Secretary of the Army. Though the National Guard (Guard) has indicated it is
     a top priority to move locations, a sale or transfer of the Interbay property cannot occur until
     the Guard is fully operational in a new location and has obtained the written authorization
     of the United States Secretary of the Army to transfer the title of the Interbay property.

     Public Development Authorities and Community Preservation and Development
     Authorities. By state law, local governments may form public development authorities
     (PDAs), also known as public corporations, to carry out a specific function such as
     administering federal grants or local programs, enhance governmental efficiency and
     service provision, and improve a municipality’s general living conditions. State law also
     provides for the ability to create community preservation and development authorities
     (CDPAs). CDPAs are dedicated to preserving or enhancing the unique historical or cultural
     character of communities impacted by certain land use decisions. Creating a CDPA
     requires legislative approval.

     Summary of Bill: State Lands Development Authority. An option is provided for local
     governments, state representatives, and others to create a State Lands Development
     Authority (Authority). An Authority may only by formed in a county with a population of 2
     million or more, to be responsible for managing the development or redevelopment of state-
     owned property within or adjacent to manufacturing industrial centers. Any land owned or
     operated by the Department of Natural Resources is exempt. Each Authority must be
     managed by a board of directors, and be granted with certain authority powers and may
     have an account in the state treasury to receive state appropriated funds. Legislative
     approval is required for an Authority to be formed. The law is similar to forming a CDPA
     under current law.

     Ballard-Interbay State Lands Development Authority. An Authority to oversee and manage
     development or redevelopment of the state-owned Interbay property, located at 1601 West
     Armory Way within Seattle's Ballard-Interbay neighborhood, is created. The 36th
     legislative district delegation, or if seeking the development of another Authority another
     delegation, may offer a proposal for creation of the Authority to the relevant legislative
     committees. The proposal must contain certain information relevant to the property
     including use assessments, dates for when land will become vacant, intention by the
     Legislature that the Authority be appropriately funded and staffed, and formation of the
     Authority.

     Board of Directors. The Authority shall be managed by a board of directors (board),
     initially appointed by the Governor but by recommendation of the legislative district
     delegation. The board must consist of certain members representing city governments,


Senate Bill Report                              -2-                                       2SHB 1173
     county governments, and port districts within the boundary of the property. Specific to the
     Ballard-Interbay Authority, there must be board members representing workforce
     development or affordable housing, have experience in public-private partnerships related
     to housing, and have experience with architectural design and development in industrial and
     mixed-use zones. Additional members may be added to the board as necessary. Future and
     subsequent boards must come from a list of candidates developed by the existing board of
     directors with consideration given to racial, gender, and geographic diversity.

     State Lands Development Authority Powers. The Authority shall have the power to:
         • accept gifts, loans, and other aid from public and private entities;
         • employ and appoint necessary agents;
         • enter into partnerships and contracts;
         • buy, own, lease, and sell property;
         • hold in trust, improve, and develop land;
         • invest funds;
         • incur debt as allowable under the state constitution and other state laws regarding the
           use of public funds for political purposes;
         • lend and grant its funds for lawful purposes; and
         • exercise additional powers authorized by law.

     The Authority may adopt bylaws, establish boundaries, assume responsibility for
     development and redevelopment, use gifts and loans, and create a strategic plan. The
     strategic plan must include certain elements. By December 1st of each even-numbered
     year, the Authority must submit a report on its progress to the appropriate committees of the
     Legislature.

     Account Created. An account is created in the state treasury for use if the Legislature
     provides funds for the Authority. The account will consist of two subaccounts, one for
     capital purposes and the other for operating purposes. Money in the account may only be
     spent after appropriation.

     Appropriation: None.

     Fiscal Note: Available.

     Creates Committee/Commission/Task Force that includes Legislative members: No.

     Effective Date: Ninety days after adjournment of session in which bill is passed.

     Staff Summary of Public Testimony (Regular Session 2022): PRO: There is a 25-acre
     armory site, where the national guard currently sits, in the heart of Seattle. We have made
     progress with the congressional delegation to move the armory. The Interbay site is prime
     location that must be considered thoughtfully by all parties. It is critical to set this public
     authority up now, so we are ready when the National Guard moves. Real estate prices are


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     rising. Entities like the public authority established in this bill will bring people to the table
     who are dedicated to finding equitable solutions to economic development. This will ensure
     community involvement on the development of this area. Normally I don't believe public
     authorities are a good idea, but the Interbay Armory site is a unique opportunity. This area
     has low vacancy rates and access to light rail. Creating an authority will allow for
     flexibility and responsiveness to many issues, including economic ones. The report done in
     2019 was extensive and considered many things.

     OTHER: This provides a desperately needed housing opportunity. Please consider
     mandating someone from the arts and a cultural center to the board. Investing in cultural
     spaces drives interest in the area and increases use of that area by community members and
     visitors. Cultural spaces can mean spaces like community clubs, bookstores, and
     neighborhood barbershops.

     Persons Testifying: PRO: Senator Liz Berry, Prime Sponsor; Chieko Phillips, Facilities
     and Equitable Development committee of the Seattle Arts Commission; Ray Dubicki.

     OTHER: Matthew Richter, The Cultural Space Agency public development authority.

     Persons Signed In To Testify But Not Testifying: No one.




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