The Federal Way City Council on Tuesday unanimously approved making the soon-to-be-built Performing Arts and Conference Center property an economic redevelopment zone.
City Finance Director Ade Ariwoola said this move is meant to help the city in its effort to secure New Markets Tax Credits, a federal funding stream the city has been aiming at to help fund the project for the last couple of years.
“The resolution before you is part of making the current area where the [Performing Arts and Conference Center] will preside, eligible for state or grant funding,” Ariwoola said. “And actually, just a few hours ago, for people that submitted their application for the New Markets Tax Credits, they asked us to make sure our program has two items, or qualifies for two items. One of them is to be in an economic redevelopment zone. What we’re asking Council is to classify this area as a redevelopment zone, so that we can qualify, or businesses that are already there can qualify for federal or state grant support.”
Councilwoman Kelly Maloney asked if making the area an economic redevelopment zone is a requirement for obtaining New Markets Tax Credits. Ariwoola said it isn’t a requirement, but it makes the city “more eligible to be able to get it.”
“It’s very similar to low-income housing tax credits,” said Councilwoman Dini Duclos. “The more points you score, the better your application. And by doing this, we will get more points, and our application will score well and give us a better chance to get the funding.”
One Council member wondered why this hadn’t been done previously.
Councilwoman Susan Honda asked why the Council didn’t know about economic redevelopment zone effort last year.
“Is this new information? Or has this been standard for this application and we just didn’t catch on?”
“To be honest, I don’t think staff knew about it,” Duclos said. “To be truthful. And I didn’t remember New Markets Tax Credits until after the application had gone in. I brought the New Markets Tax Credits to staff and Council, and I don’t think staff realized it on that first application.”
Brian Wilson, the city’s chief of staff, said applying for the federal program has been a learning experience, and attributed the misstep to that.
“We’re getting better at knowing the key elements that make the difference between success and not success,” he said. “And oftentimes, it’s the little stuff that gets that done.”
Deputy Mayor Jeanne Burbidge agreed with Wilson’s assessment.
“Our city has not worked with New Markets Tax Credits previously to this project. The more you work with this kind of process, doing the research and bringing on people who do have experience with the process, the more you learn and the more effective you become with the application,” she said.
Maloney wondered if approving this designation would have any unintended consequences that could block potential outside interest in the area in the future.
“I don’t see any downfall or adverse effects,” Ariwoola replied. “And [that assessment] is based on conversations with our lawyer also.”
Honda raised concerns with language in the motion regarding the powers being delegated to Mayor Jim Ferrell, and also how a current moratorium in the area would be effected. Interim city attorney Amy Jo Pearsall said the mayor’s powers weren’t being expanded in any way, and that the motion would have no effect on the current moratorium.
To learn more about the Performing Arts and Conference Center, visit www.ci.federal-way.wa.us/