Hats for Sale

Winslow Tomorrow has sparked growing distrust in city government. City Council meetings have become increasingly rancorous, and more than 500 islanders have signed a petition calling for a stop to the effort. And yet the Administration keeps bringing forward proposals and new consulting studies to justify them. The question is why does it keep moving forward so doggedly?

You might expect downtown property owners to be one force, and they are, but this alone does not explain the momentum. What may not be as clear is that the City’s own hired consultants have become a force to be reckoned with and that some of the consultants may stand to benefit from financing or developing projects they have helped plan. With some consultants taking on multiple roles as Winslow Tomorrow Facilitators and outspoken advocates of the effort, it becomes hard to know which hat they are wearing on any given day. The recent feasibility study for a parking garage is a case in point.

One Stop Shopping?

Parking is one of the most daunting and complicated issues in real estate, and in most places a city government would start by hiring experts to identify basic needs and the various alternatives for meeting these. Here on Bainbridge Island, however, the Administration went straight to the step of paying for a feasibility study for a garage that would range in size from about 325 spaces up to over 1000 spaces. Last March, the Mayor signed an agreement with Haggar-Scribner Properties, LLC and Sandstrom Properties, LLC (together as SSH, LLC) to study the feasibility of building a parking garage on the city-owned lot adjacent to the combined property holdings of SSH. This $127,500 professional services contract has become known to many as the “Capstone Contract”, as the agreement with the City provided that Capstone Properties, LLC would perform the study on behalf of SSH.

The contract stipulated that Capstone would provide “needs programming”, “rough order of magnitude” cost estimates and a financing and development plan for the garage. This agreement, Winslow Tomorrow’s second largest professional services contract in the last two years, was not put out to competitive bid.

Capstone’s website states that the firm “plans, finances, implements and manages” commercial real estate investment for investors and organizations. Not only does the firm appear to handle everything from site acquisition to development to management for commercial, multifamily residential and medical facilities for others, but judging from its project portfolio, it is also in the business of real estate investment and development for itself.

About a week after signing the Capstone contract, the City also signed a $38,500 contract amendment to an existing contract with National Development Council (National), to oversee Capstone’s work on behalf of the City. National is locally represented by Chuck Depew. This contract also provided that National would evaluate the “function and financing of a quasi-governmental entity” to support the City’s “implementation efforts” of financing and developing the garage, in other words, a private-public partnership. This brought the total cost of these two parking garage feasibility contracts to $166,000.

Over the last four years the City has contracted both with Chuck Depew, individually, and with National, his employer, for almost $120,000 in no-bid professional services for work on Winslow Tomorrow. The National Development Council’s website bills the organization as “one of the oldest national non-profit community and economic development organizations in the U.S.”. And in municipal circles, National is well regarded for its training and financial analysis capabilities.

However, the organization also takes on the roles of financing and developing big public works projects like this garage, for which the fees for “implementation” are much bigger than the fees for consulting. In this way National’s business model is very much like Capstone’s – doing consulting work that sometimes leads to development, where the fees can be much greater.

Public/private partnerships always require squeaky-clean relationships, but these relationships become even more complicated when key players have dual roles as both consultant and financier or developer. Such was the case in Seattle where, in the late 1990s, the City of Seattle hired National to help it arrange financing for the $73 million public garage being built through a public/private partnership with a developer. According to the Seattle Times, the city’s Ethics and Elections Commission issued a report finding that National had violated a $70,000 consulting contract that barred it from having any financial interest in the project, by making an arrangement with the garage developer that would pay National $500,000.

Chuck Depew was Deputy Director of the Seattle Office of Economic Development and oversaw National’s work. According to the Times, he described the ethics commission’s report as “over dramatized”. Depew left the City to join National the following year.

National also developed an office building for King County. A Seattle Weekly article titled King Street, Easy Street carried the sub-heading “Developer John Finke cleans up with another ‘public private partnership’”, referring to the head of National’s local office. This article describes Finke as a “consultant-cum-developer” and his work with the County as “another sweet deal”.

The parking garage feasibility report here on Bainbridge states that the cost figures assume “privately commissioned project delivery” of the garage. This is developer-speak for someone other than the City designing, building and financing the garage. And this would be no small project, for the possibilities under consideration range from 325 to about 1000 spaces and would cost tens of millions of dollars. The financing and development fees could range from $700,000

There is also interesting language in the Capstone contract about joint cost sharing on future work phases to include preliminary design, plan review and a “final decision process” for construction of the garage. Considering this language and the business models of both Capstone and National Development, both of these firms seem to be ideally positioned to be key players in future downtown development – potentially even in the development of the parking garage.

The Capstone and National contracts raise two key questions: 1) what care and due diligence has the City Administration taken in hiring consultants who may have a conflict of interest and 2) what roles has the City given these consultants in shaping and directing the overall Winslow Tomorrow program?

Now You See 'Em, Now You See 'Em Again

Winslow Tomorrow has a long history of a few people playing multiple roles. Don Audleman (Capstone), Chuck Depew and Tom Haggar (Haggar-Scribner Properties) have all been ardent supporters of and participants in Winslow Tomorrow. Depew was heavily involved in preparing the financial pro formas used by the Administration to argue for bigger buildings, and was a member of the Winslow Tomorrow Feasibility Committee that voted to send these studies along for public use. This committee was chaired by then City Council candidate Kjell Stoknes, who is now a sitting City Council member. Other participants in that committee included former Winslow Tomorrow project manager Sandy Fischer, John Waldo, former Bainbridge Island Downtown Association president Will Langemack, retired health care consultant Howard Kirz, Winslow developer Bror Elmquist, and others.

Some members of the Feasibility group had also served as facilitators for the Winslow Tomorrow citizen congress, including Depew, Stoknes, Waldo, and Kirz. At least one, Depew, was apparently paid for that work. The City also subsequently contracted for professional services with at least two other citizen group facilitators, including Julie Shyrock and Michael Read.

Don Audleman of Capstone has served as a member of the Winslow Way Streetscape Advisory committee along with Tom Haggar, co-owner of the property occupied by the Virginia Mason Clinic, and his wife. Haggar has been actively involved in lobbying the planning commission to approve proposed increased building heights and density in the Winslow Core and both he and his wife also served as citizen participants in the Winslow Tomorrow congress.

So, when someone gets up to speak in favor of Winslow Tomorrow, or to lead a “public outreach” effort, do we know whether they are they speaking as citizens, as Winslow commercial property owners, as paid facilitators, as financing consultants, as financiers or as developers? Or, are they performing multiple roles at the same time?

It is clearly the City administration’s responsibility to keep participants’ roles and responsibilities clear, to protect against conflicts of interest in the way it runs planning efforts and to disclose potential or actual conflicts of interest once they are discovered. In fact, the American Planning Association states quite clearly, in its ethical principles that planning process participants should “make public disclosure of all ‘personal interests’ they may have regarding any decision to be made in the planning process in which they may serve, or are requested to serve, as advisor or decision maker".

The Way Forward

There are at least three qualities that most City governments seek to embody in their planning and public works projects. The first is an open and transparent process, so that citizens know if the person at the microphone is simply an interested citizen, is a paid consultant supporting an Administration policy or is a developer, land owner or potential future developer who will benefit from a particular outcome. Secondly, the work should produce real and alternative options. A good process starts with a good analysis of needs, and then presents the various solutions in a balanced way. Thirdly, there should be solid support in the community for any proposal that is likely to change the nature of the place. In cities with a council/ manager form of government, the manager usually wants to pass controversial measures with a majority of two, if not three passing votes – if only because he or she does not want to be one vote away from being fired should the politics reverse themselves.

Bainbridge has a “strong mayor” form of government which makes the Mayor the elected chief executive responsible for hiring the right people and ultimately responsible for running a fair and open process. Her signature is on most of the contracts, and the buck stops with her on management issues and the performance of her administration.

So far the costs of Winslow Tomorrow are more than $4 million and the revolving door of consultants, financial stakeholders and other planning participants spins on. The Winslow Way Streetscape project and other downtown redevelopment efforts have taken on the force of a steamroller, with the Mayor firmly at the wheel. Together they are rolling towards projects with costs five and ten times what she has already spent. Are the same people who developed the map for these ventures also along for the full ride? And without a more open and transparent process, how will we ever be able to trust that planning decisions and recommendations reflect the interests of the community and not those of a small group of people wearing many hats?

(To post or read comments on this story click on 'COMMENTS' below)

Getting to the Heart of the Matter

Even before our new City Council members have been sworn in, attempts are being made to “fix” the relationships between those who will govern and staff our island’s City Hall in 2008. After last week’s personal growth workshop for Council and staff, one has to wonder what might be rolled out in 2008. At the risk of being glib, might we recommend a weekly massage? Or perhaps gourmet catered lunches? While in theory these might raise morale among City employees and electeds, it is hard to imagine that taxpayers would be willing to foot the bill for either. Are they any more likely to support personal growth workshops held on City time and paid for by taxpayer money? And is there even more at stake here than consultant fees and lost productivity?

These are questions worth asking, as it appears that the recent workshop may be only the beginning of taxpayer-funded group therapy for COBI staff, elected officials and even private citizens. While Mayor Kordonowy’s recent decision to spend nearly $25,000 for the current 5-day workshop caught the public by surprise, her plans for additional workshops, and purportedly to provide workshop vouchers to private citizens, will not enjoy the same stealth cover. In fact, come December 12, we will see whether funding for future sessions will survive City Council scrutiny of the 2008 Executive Department budget.

On the Agenda...Joy

The workshops in question are truly “training” Bainbridge style. Where else could one imagine the Mayor inviting a group of city officials, staff and private citizens to attend an intensive 5-day personal growth workshop that, according to the program’s website “provides a beacon for people to awaken to the possibility of living life from their own soaring spirit” and that will help participants “deepen their foundation of connection with one another, with community, to expand their vitality, power, and heart across all aspects of their lives”?

A local firm, Gale Consulting, is facilitating this “Heart of Leadership” personal growth program that began last week and concludes with a two-day session in December. According to the Mayor, the workshop’s focus on “collaboration and communication” justify the commitment of valuable City time and resources to make it happen. That significant morale and communication problems exist at City Hall was well documented by the 2006 Benchmarking Study. Based on interviews with key stakeholders, including 90% of City staff, the study noted, for example, an unusually high turnover rate for regular employees – almost double the norm. And the communication breakdown and role confusion between Council and the Administration is an accepted fact.

But this is much more than a “communication” workshop. It is an intense and very personal interactive retreat designed to empower individuals to find “Heart, Spirit, Joy and Accomplishment in the Workplace.” Amba Gale, the owner of Gale Consulting and moderator of the workshop, appears to be a well-seasoned “transformational consultant.” Of note, Ms. Gale has worked for the Hunger Project, a program developed in the 1980s focusing on ending world hunger, and which was the brainchild of Werner Erhard (founder of the infamous Erhard Seminars Training or “EST”). The EST goals of achieving personal transformation and enhanced power in participants’ lives are not dissimilar from those described in the Gale Consulting marketing materials.


Building a Circle of Power

In late October of this year, the Mayor sent out workshop invitations to 24 invitees, which included approximately 1/3 each of senior staff, current/emerging City Council members and selected private citizens (amazingly, this included some but not all of the then Council candidates). Shortly thereafter, as legal questions emerged about the propriety of funding such a highly personalized program for private citizens, that invite list shifted. Citizen invitations were withdrawn and the final list included only two sitting Council members, three Council members-elect, our Mayor, seven City Directors, and six senior staff members.

The timing of the event tells more about who was really invited than the invitees themselves. Consider that, rather than wait for the new year, Mayor Kordonowy opted to hold the first three days of this 5-day workshop on the heels of Thanksgiving, knowing that long-time City Council member Bill Knobloch would be on a vacation scheduled months in advance. Even after learning that the other senior Council member Debbie Vancil would also not be able to attend at that time, the Mayor scheduled the first session for November 26th-28th.

Selecting workshop dates that excluded the two most experienced Council members raises a question as to whether team-building was ever a true workshop goal. But because Vancil and Knobloch were absent, the Mayor was assured that the proceedings would be private. With fewer than four sitting Council members in attendance, the public could be legally excluded.


What’s the Real Cost?

What will be the cost “to create extraordinary relationships” among these folks? Certainly the tangible costs to the City and community at large for these consultant-facilitated therapy sessions are much greater than the contract price. Consider that:

> The workshop takes place on workdays (7:30 am to 5:30 pm). Taking into consideration regular salaries, exclusive of perks, outlays to the 14 City employees in attendance for five full workdays conservatively totals over $24,000. [Not included is the gratis time of the sitting and recently elected Council members.]

>Add to this the “opportunity cost” of lost productivity. What fell off the table or was delayed because staff was unavailable?

> There’s another hidden redundant cost. Two attendees had been through the course once before at taxpayer expense – the Mayor and City Administrator. In addition to participating twice, our City Administrator won’t even be on the City payroll by year’s end.

Readers might be wondering how this happened without public comment and why Council ever approved the contract. The fact is that all aspects of awarding the contract occurred outside of the public eye. It was Mayor Kordonowy who single-handedly negotiated and signed the contract for the workshop. The $24,900 fee was paid out of the Executive Department’s 2007 budget. Interestingly, the workshop’s price tag is a mere $100 shy of the $25,000 limit on the Mayor’s contract signing authority.

The PostScript has written previously about the Mayor’s broad contract signing authority. The Mayor has been free to enter into such contracts since April 2007, when Council expanded her authority for signing “professional or nonprofessional services” contracts from a value of $10,000 to $25,000 per contract. Unfortunately, Council didn’t stop there. Under the same Ordinance, the Mayor’s contracting authority will increase in 2008 to an unprecedented $100,000. There’s no stopping this expansion of the Mayor’s discretionary spending unless our City Council takes back their legitimate authority in 2008. But will there be the will to take such action after having made a commitment to the Heart of Leadership program with the Mayor and whatever that entails?


If You’re Not With Us...

Gale Consulting promises to “facilitate processes which generate authentic quality of relationship between people, including people who have had previous conflicts with one another”. A more than laudable goal, especially for an organization with a long history of distrust and conflict. But where was the conflict between incoming Councilpersons, who have yet to be sworn in, and the Administration? Is this really an attempt to correct an existing conflict, or is it an attempt to commit our incoming Councilpersons to a good behavior compact, or even a “bonding” so that they, as one veteran of the program has swooned, “will do anything for one another?” And this at a time when what is most needed, and justified, is a firm pushback from the Council against a Mayor and Administration that has by their own actions earned the distrust of so many in the community.

One of the most puzzling aspects of this program is how it’s possible “to create relationships that are founded in trust, partnership and alignment” without discussing any of the facts surrounding the basis for the existing distrust and conflict. Apparently, one of the workshop’s ground rules is that no City issues be discussed. And if the goal really is to improve the relationship between Council, Staff and the Mayor, how can that be accomplished without the involvement of Councilpersons Knobloch and Vancil, the only sitting Councilpersons continuing on in 2008 who have expressed public reservations about the Mayor’s agenda?

We may never know what the Mayor’s real purpose is in enlisting the services of Gale Consulting, and we have little choice but to have faith that our newly elected Councilpersons will make decisions in the new year based on the best interests of the community rather than any perceived obligation to the Mayor or to maintain an appearance of “getting along”. Whether or not the Mayor honestly believes that personal growth workshops can cure what ails City Hall, the question remains – should a City strapped for funds approve a 2008 budget that allows our Mayor to contract for future City group therapy sessions or related activities? Increasingly, taxpayers are saying “stop.” The time has come for our City Council – the legislative and policy making branch of City government – to do what is necessary to responsibly take back control of the public purse and our City.

Wherefore Art Thou Council?

After years of successfully blaming our City Council for all that ails the City of Bainbridge Island, the Mayor and her administration are finally receiving a long overdue admonishment by the community. Island residents are becoming savvy to an imbalance of power and are finding that the agenda of a small group of private interests has supplanted the will of the community. As citizens call for a change to a Council-Manager form of government, or even to recall the Mayor, they are recognizing that what is needed is a structural change, not simply a change in personalities. However, at this pivotal moment it is critical that we not lose sight of the essential role our City Council has played in its own (and our own) undoing, and that we insist that our current and incoming Council Persons reestablish their roles as meaningful representatives of the entire Island community.

Change will not come easy, as the improper subordination of Council has been institutionalized on so many levels at City Hall. Our City Council has no dedicated staff, no office space, a meager meeting space and a $600 (why bother) monthly stipend for what is realistically a full-time job. For all appearances, members of Council are tolerated as occasional interlopers into the business of policy development and governance and as inconvenient obstacles that must be surmounted by City Staff as they drive the Mayor’s agenda forward. Council’s value appears to lie only in its ability to fund the projects brought before it. To this end, Council is generally left in the dark regarding complex policy proposals and projects, significant code changes are presented as minor housekeeping matters and agendas are often packed with substantive issues that demand far more than the allocated time or background data provided.


No One to Blame but Themselves

Council is neither without blame nor without authority to act against this marginalization of its legislative role. Under state laws RCW 35A11.020 and 35A12.90, Council “shall have all powers possible for a city or town to have under the Constitution of this state” including the powers to:

- Establish policy
- Adopt ordinances and resolutions
- Establish a budget
- Approve or amend the operating and capital budgets
- Define the functions, duties, and responsibilities of City officers and employees
- Enter into and approve contracts
- Regulate the acquisition, sale, ownership, and other disposition of real property
- Impose taxes
- Approve claims against the City
- Enact rules governing the City Council’s procedures and meetings

(excerpted from COBI City Council Legislative Protocol Manual)





By contrast, the duties and authority of the Mayor are largely limited to administration and enforcement of law and policy established by Council:

“The mayor shall be the chief executive and administrative officer of the city, in charge of all departments and employees... (she) shall see that all laws and ordinances are faithfully enforced ... and shall have general supervision of the administration of city government and all city interests...the mayor shall be the official and ceremonial head of the city and shall represent the city on ceremonial occasions...”
(RCW 35A.12.100)

The Mayor’s policymaking role is essentially limited to the submission of proposals for Council consideration, including a draft annual budget. Council may reject any and all projects, policies and ordinances proposed by the administration, and is expected to establish its own long-term policy platform.

Yet, not only has Council failed to establish a solid legislative agenda of its own, but it has allowed the Mayor’s agenda to drive City policy and drain City resources even as it has doubted community support for that agenda. Council has missed countless opportunities to question the need for more consultants, to probe into the role of special interests in creating policy or to refuse to approve successive funding requests to study and plan for projects it had not initiated or had not yet approved. While on occasion some Council Members have opposed or even voted against the Mayor’s agenda items, more often than not, every item presented has been funded or approved.

Examples of these inexplicable missed opportunities abound. Why did Council willingly abdicate its power to approve contracts up to $100,000? Why did Council grant the Mayor authority to settle litigation under $50,000 without regard to the subject matter of the action? Why did Council allow the virtual rewriting of the Winslow Master Plan to apparently reflect the recommendations of a few special interests? Why did Council approve nearly $1 million dollars in consultant fees for public outreach and the preliminary design of the Winslow Way Streetscape? Who but Council bears responsibility for allowing, by action or inaction, the commitment of untold resources (more than $3 million in known costs to date) to advance plans to completely redefine the character and landscape of our island, without any evidence of widespread community support?


Time to Just Say No

Council has at times reined in an overreaching administration and staff. For example, Council positively exerted its authority when it refused to approve unreasonable funding requests related to the 2025 Growth Advisory Committee earlier this year. When planning staff came forth in May seeking funding to begin the implementation of the recommendations of the Committee before its final report had been provided to Council, the Council stood firm. After expressing surprise at learning that the committee had even concluded its business, Council rightfully refused the request as premature. To the chagrin of staff, when the report was finally provided to Council in June, it was “accepted” as a document, but Council chose to neither adopt its recommendations as policy nor to fund projects flowing from them until it could find adequate time to study the details of the report.

In the coming weeks, the current City Council will have many opportunities to show the community, the administration and incoming Council Members this same resolve and independence as it considers the Mayor’s proposed budget, the Capital Facilities Plan and a series of significant proposed Comprehensive Plan Amendments and Ordinances.

In light of the magnitude of the Mayor’s policy agenda, and the community’s increasing opposition to it, Council must insist on adequate briefing materials prior to Council Meetings and, even more importantly, the time to evaluate, research and discuss the issues. This may require Council to refuse to consider some agenda items or to delay their consideration – a small price to pay for informed and thoughtful decision-making. It would also seem appropriate for Council to take long overdue advantage of its authority to provide itself with dedicated staff. According to the City Council Legislative Protocol Manual, Council is authorized to create a “Legislative Department” including staff positions to provide “assistance on legislative research, drafting of City policies and laws, as well as providing clerical support.”

One thing is certain: regardless of which structural or organizational changes Council pursues, our Island will not stand a chance without a commitment by Council to assert its broad and substantial powers and to ensure that community priorities, not private financial interests, guide policymaking and spending decisions at City Hall.

As Easy as ... One, Two, Three

The process by which the Winslow Tomorrow Streetscape has been developed and is currently heading toward implementation, is providing a crash course in the brutal realities of Bainbridge Island politics for those who are paying attention. Unless Council takes a dramatically new course soon, it appears that the Mayor will be well on her way to implementing an agenda that threatens to have grave and widespread consequences for us all.

Those familiar with how business is done at City Hall will recognize the three cardinal rules at play over the last few months. The question before the Council, and the community, is whether this time Council will have the political stamina to break the rules.


Rule #1: Citizens Shall be Seen and Not Heard

In prior articles, we have discussed the heavy influence of a handful of Citizens, many of them downtown property owners, in the latter stages of the Winslow Tomorrow process and on other downtown related committees. Not only are these special interests heavily represented on the Streetscape advisory committee, but amazingly, the controversial, and arguably self serving, funding scheme for the Streetscape was crafted by these same individuals working alongside redevelopment consultant Chuck DePew and Councilperson Kjell Stoknes (see sidebar for more on Mr. Stoknes).

But what about the other 24,000 voices on the Island? To be sure, an incredible amount of lip service is given to public process at City Hall. From the comments made by many advocates for Winslow Tomorrow, you’d think dissenting Citizens had hijacked the process. In fact, a consistent pattern has developed of highly structured “open houses” and other “town meetings” where the message is tightly controlled and the outcome appears to many attendees as a forgone conclusion.

The Streetscape group boasts heartily of the support shown for its preliminary plans at the 4th of July festival. But what about the other two citizen meetings conducted for the project since July? Might not the community, and Council, be interested in the opinions of average citizens provided with details – including costs and funding strategies – and the time to reflect and ask questions?

Unfortunately, we haven’t heard much in the way of an actual summary of public comment from these events, neither have we heard from the Winslow Way business owners (the tenants) nor specifically from the Winslow water and sewer ratepayers.

Perhaps these two questions from a City comment sheet provided at the last public Streetscape meeting say it all (See here for one couple’s responses.):

“8. Do you feel you have a right to say how Winslow Way
should be rebuilt? For what reasons?

9. Do other islanders have the same right to say how your street should be rebuilt? For what reasons?”


Ouch.


Rule #2 The Mayor Shall get her Way

There’s a reason that the Mayor opened last night’s budget presentation looking like the cat that ate the canary. In effect she did when she managed to push her legacy building agenda forward last Wednesday night despite a lack of support by a majority of the seated Council.

The dance between Council and the Administration around the Capital Facilities Plan last month created an ideal opportunity to witness the results of this total disregard of the Administration for Council’s attempts to set policy consistent with community priorities.

At that September 12th meeting, Councilperson Tooloee, often criticized for the tenor of his presentation, but arguably one of the strongest voices on Council, contrasted the spending priorities Council had presented the Administration with those the Administration offered back to Council in the Capital Facilities Plan. According to Tooloee:


“Council directed that total investments in open space, non motorized transportation, affordable housing, and community facilities over the next six years be set at $18 million, $18 million, $11 million, and $5 million, respectively.

The Administration has ignored that policy and drastically slashed the total investments in these areas in the next six years to $10 million, $10 million, $3 million, and $1 million, respectively. These cutbacks are not in line with community values or needs.”


Tooloee went on to demonstrate that the Administration had also chosen to disregard Council’s direction as to the ratio of Voter approved bonds to Council approved (councilmanic) bonds:


“When council adopted the CFP last year by a unanimous vote it limited council-approved bonds to $15.5 million over six years (down from over $35 million as proposed by the Administration) and slated $31 million of voter-approved bonds, to be approved by the voters in 2008 to be sure that they agreed with the priorities established by Council.

The proposed CFP hikes reliance on council-approved bonds (which some disparage as credit card debt!) by 20% to $18 million and cuts voter-approved bonds (the best way for voters to say if they agree with the City) by almost 70% to $10.5 million. The funding mix should give a much greater voice to the voters.”


These fundamental splits between the majority of the Council and the Mayor and Administration, on both spending priorities and funding mechanisms, and the Administration’s attempts to thwart Council’s efforts to set the policy it believes to reflect community values, resulted in some trouble for the Winslow Tomorrow Streetscape Project funding proposal when it was first presented to Council on September 5th. Staff was directed by Council to provide alternatives to the controversial proposal, which relied on council approved bonds, significantly increased fees for Winslow water and sewer users and required no contribution from the owners of benefited properties.

Last Wednesday, Council was presented a barely modified version of the original funding proposal. This time, however, Councilperson Bob Scales was not present due to a planned absence. The result was a foreseeable tie (for those on the inside who knew which Councilpersons would be present) and the Mayor was able to cast the, marginally legal, deciding vote. What is most amazing about the vote is not the incredible fortuitousness of the timing of the vote, but the incredible care that had been taken to craft a motion that the mayor, who cannot break ties to expend funds, could legally vote upon.


Rule #3 Council Shall Bear all Blame

And so, as has often been the case before, the Mayor has placed those on Council who do not support her agenda in a politically untenable position. They can choose to fund the $20.6 million option using the Administration’s preferred funding strategy, or they can refuse to fund the project, a decision which will be billed by the Administration, and the(ir) Bainbridge Review, as a querulous and irresponsible refusal to fund the necessary replacement of leaking pipes.

This is where the breakdown at City Hall has cost us dearly in the past. As much as the Administration has been expert at depriving Council of information and staff, manipulating process, timing and the law to pressure and confuse Council into approving the Mayor’s agenda, Council could have, and indeed has a duty to, refuse to cooperate until the terms are changed.

The result of not stopping the Mayor’s agenda earlier, has been a slow painful descent into a special interest version of Winslow Tomorrow, with the Streetscape being the first of a impending series of expensive and monumental decisions that will change the face of the City forever.

And so, faced with a politically painful decision – to fund or not to fund the Streetscape – what will our Council do?


Time to Break the Rules

That self-satisfied look on the Mayor’s face last night, quickly dissolved when her own loyal (and impeccably professional) finance director made cautionary remarks about the funding of these “extremely large projects for a city of this size.” Mr. Konkel’s remarks when taken in conjunction with the failure of the current process to fairly assess and consider the public will, give great credibility to the position taken thus far by a majority of Council. Council must be called upon to continue to put the community’s best interests before any personal or political concerns.

The mayor’s vote also occurred in a time of increasing calls for a change to a Council-Manager form of government (a thinly veiled attack on her performance), and has incited more than a few of those voices to call outright for a recall election. This decline in support for the Mayor’s agenda also serves to strengthen the mandate for Council’s refusal to cooperate

Councilperson Bill Knobloch, has correctly pointed out that “this is where the rubber meets the road” when addressing the fact that there is only so much money for so many projects. This is also where the rubber meets the road for Council’s success or failure as a political body tasked with representing, and indeed defending, the interests of the community above all else.

Settling for Less and Losing Even More

There have long been indications that City Hall is overly susceptible to litigation pressure from the moneyed interests on the Island. Unfortunately, as non-elected citizens, we are at a disadvantage when it comes to monitoring how the City manages its litigation portfolio, as virtually all discussion and negotiation occur behind the veil of executive session. However, sometimes the results of these efforts to appease the disgruntled citizen come to light and demand our attention. Last year, it was docks on Blakely Harbor. This year, it’s patio houses along the Wing Point Ravine.

As a community we are deeply affected by the financial realities of handling constant litigation. Frivolous, legitimate, malicious or well-intentioned, lawsuits bleed the coffers and are a distraction from the real business of running a city government. Therefore, they should be settled when appropriate. But not at all costs. Re-writing laws, manipulating public policy or making special exceptions to satisfy a complainant jeopardizes the integrity and viability of the government and its policies.

Quid Pro Quo

Capstone Partners, dissatisfied with the Hearing Examiner’s (HEX) decision denying its application for a Conditional Use Permit (CUP) to build 11 houses along a ravine near Wing Point Country Club, filed a lawsuit for damages against the City in August of 2006, one week after filing an appeal of the HEX decision. In July of this year, in an apparent attempt to settle the damages claim, the Mayor authorized the attorney for the City to enter into a stipulation of facts in support of and calling for a remand of the CUP matter to the HEX. The Superior Court accepted the stipulation and remanded the case.

The legal authority to authorize the stipulation to the remand, the subject of an earlier article on this blog, is not dispositive of the question of whether this remand and the context in which it occurred are appropriate. The facts available to the public suggest that even if the mayor had had the authority to agree to a legitimate remand, the decision to remand in this case, in the absence of newly discovered evidence and in the context of a settlement agreement, was at best contrary to the public good. Furthermore, it remains unclear as to whether the Mayor had authority to settle the damages claim at all.

As discussed previously on this blog, there appears to be neither newly discovered evidence nor a clear mistake justifying a remand to the hearing examiner. The issue could have been appropriately litigated before the Superior Court, with the City advocating for its Hearing Examiner’s application of its land use code, and with the Court making a decision as to the appropriateness of a remand. But instead the City, at the behest of the Mayor, agreed to the remand in consideration for the dismissal of the damages claim.

Money Changes Everything

As a general rule, the City Council has final authority over the settlement of lawsuits. In March of this year, the City Council, at the request of the administration, granted the Mayor the authority to settle claims by or against the City “in an amount of $50,000 or less”. In the damages claim at hand, Capstone sought relief under RCW 64.40.020 and alleged that the HEX had acted in an “illegal and/or arbitrary and capricious” manner (a high standard consistent with the deference generally granted to governmental action). The damages alleged included “expenses and losses, including lost sales and profits, enhanced construction costs...” and “costs and attorneys fees”.

Clearly, were the plaintiffs to prevail, potential damages would far exceed $50,000. Clearly, Capstone would never have considered settling for an amount less than $50,000, as that would not have even paid their legal bills. And so the question remains: Under what authority did the Mayor act to settle the Capstone lawsuit?

Even if the Mayor had had the authority to settle the damages claim, a critical public policy question remains. Should the outcome, or even status, of a land use decision ever be on the negotiating table when the Mayor, or Council, is contemplating settling a claim against the City? There can be no dispute as to the answer to that question. We are a society of laws. We expect laws and policies to be applied as fairly and consistently as possible. We expect those we entrust with applying the law to correct mistakes made in the application of the law (to reverse, remand or withdraw) but not to change the rules of the game arbitrarily for privileged members of the community. Aside from the fundamental unfairness to the rest of the community who must abide by the rules, and the implications for whatever public good the law was attempting to protect, what message does this send to those with the financial ability and will to sue over any legal action that causes them inconvenience or discomfort?

Whatever the outcome of the Capstone controversy, perhaps it’s time for the City Council to take another look at the scope of authority that it actually granted to the Mayor to settle claims. Was it ever intended that the Mayor, independent of Council, could settle claims, like Capstone, where the actual relief sought is not in the form of monetary damages but in a favorable land use decision? And perhaps Council should revisit the associated grant of authority to the Mayor to approve contracts valued up to $100,000 (recall the $25,000 no bid contract to Capstone for the parking garage). Surely, decisions concerning such significant amounts of our tax money and critical legal issues should be vetted by more than one person and through a more transparent process.


The HEX is scheduled to hold a public hearing on the Capstone matter on September 27th.

The Mayor Takes the Wheel

Who has the final say in land use decisions? Can the Mayor or Council intercede to bypass our state and city land use laws and procedures? That’s what appears to have happened with a proposed 11-unit development in the Wing Point neighborhood when the Mayor, without any apparent authority, essentially gave a developer a second chance to try the same case.

The Rules of the Road

Island land use decisions are initially made by the City Planning Department. When a conditional use permit is involved, the City Planning Director presents the report at a public hearing before the Hearing Examiner. During this process, representatives of the Wing Point Way Neighborhood presented their concerns about Capstone Partners’ plans to develop a thin strip of land along a ravine on Wing Point Country Club property. Following the hearing, the Hearing Examiner (HEX) issued her decision on July 21, 2006, reversing the City Planning Director’s decision and denying Capstone’s Conditional Use Permit (CUP) to build 11 “patio” homes on the 3.9 acre parcel. At that point, either party could appeal the HEX’s decision to Superior Court. Alternatively, either party could ask the Hearing Examiner to “reconsider” her decision if they could demonstrate that a clear mistake had been made or that new evidence had been discovered that could not have been produced at the hearing. Capstone timely filed their appeal in Superior Court on August 8, 2006.

A U-Turn at Superior Court

Something unusual then happened with Capstone. On July 13, 2007, after almost a year of delays, counsel for the City was asked, apparently by Mayor Kordonowy, to join the developer’s attorney in signing a stipulation to grant Capstone a second bite at the apple. The case was remanded, removing it from Superior Court and sending it back to the HEX. There is no record of City Council having agreed to this action. Nor does there appear to be any authority for the mayor to have negotiated the agreement.

What’s extraordinary is that this stipulation was signed by the two parties who lost before the HEX in 2006—Capstone and the City, which had given the development a thumbs up. It was after hearing the comments of the community that the HEX ruled that the City’s approval of the CUP should not be upheld, and denied Capstone’s application for a CUP, in one of just two HEX decisions out of eleven that found for the community and against the City in 2006. Capstone lost not only because the law was against it, but because the community was both angry and alert.

Time to cry “foul”

We all expect our state and municipal laws to apply to all of us, including elected officials – including our Mayor. What happened here? The Hearing Examiner will rehear this matter based, not on “newly discovered evidence,” but rather based on evidence that the developer is now willing to develop (including Revised Site Plans) in order to convince the Hearing Examiner on a second go-around.

It’s time for the community to cry “foul”. There is no notation in the City Council minutes that justifies City intervention in this action by Council or the Mayor. And the recent Council authorization for the Mayor to settle litigation that does not exceed $50,000 was never intended to circumvent state and city land use laws that meticulously set forth rules and procedures for decision making. In addition, an exhaustive search has turned up no mayoral authority under state law to intercede in or settle land use matters.

The Ride’s Not Over Yet

Obviously the Mayor’s intervention in this matter creates quite a coup for Capstone. Not only will this remand allow Capstone to re-argue its case, but it will also allow Capstone to avoid having to file a new Conditional Use Permit. Why is that important? If Capstone applied for a new CUP, it would have to comply with the new and stricter Critical Areas Ordinance, which provides greater protection for our most vulnerable critical land areas, including the steep slope and creek on the property in question. And this intervention is not the only special treatment Capstone has enjoyed in recent months. Amazingly, on June 24, 2007, the Mayor granted a $25,000 no-bid contract to Capstone, a litigant against the City, for a downtown parking garage study.

The Wing Point neighbors, who successfully spoke out against the Capstone development at the 2006 hearing, have remained organized and are speaking out now about these latest developments. They have published a blog to keep the community informed and have asked members of the community to question the mayor regarding her involvement in the case. Go here for more information and updates.