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HomeMy WebLinkAboutHE Determination SP 2021-005 Rodeway Inn SRO Conversion CITY OF PASCO HEARING EXAMINER FINDINGS OF FACT, CONCLUSIONS OF LAW,AND DECISION Special Permit, SP 2021-005 Rodeway Inn Housing Conversion May 11, 2021 1. FINDINGS OF FACT 1.1 Proposal. Special Permit request to convert a 104-unit motel into long-term Single-Room Occupancy(SRO)units on a 1.85 acre site. • Applicant. Ziad Elsahili/Fortify Holdings, LLC, 17933 NW Evergreen Place, Beaverton, OR 97006. • Location. 1520 North Oregon Avenue, Pasco, WA. Assessor Parcel No. 113-481- 144.1 1.2 Site and Surrounding Zoning/Uses. The site is zoned C-3 (General Business) and is occupied by a motel. Surrounding properties have the same zoning with uses including general commercial, a cemetery, and vacant property. 1.3 Evidence Reviewed. The Examiner admitted the Community and Economic Development Department's ("Department") revised Staff Report, which attached maps (overview, vicinity, use, zoning, and comprehensive plan), a site plan, area photographs, hearing notice, and legal memos from the Department and Applicant on an impact fee disagreement. The revised Staff Report addressed SEPA revisions. The Examiner also reviewed: • The initial and revised SEPA Checklists, SEPA determination, and Application. • E-mailed legal analysis from Applicant and Department legal counsel submitted after the hearing. • Applicant details on the site's perimeter landscaping. • A Department request for the Applicant to provide a notarized signature from the property supporting the Application.2 Following record closure, both parties submitted supplemental argument on a case addressing impact fee vesting. Also, the Applicant's counsel indicated the school impact fee dispute had not been resolved, and a decision should issue. The Department stated it had met with the School District and wished to discuss a possible solution with the Applicant. The Examiner informed the parties that if a joint request to re-open the record was submitted, it would be re-opened to allow for resolution. No such joint request has been received. 1 The Staff Report includes the legal description. 2 As it has not been confirmed that this was received,a condition should be added confirming same. City of Pasco Hearing Examiner Page 1 of 8 Decision, Special Permit SP 2021-005 1.4 Preliminary Ruling. The Examiner issued a preliminary ruling on the appropriate timing for determining when impact fee ordinance applicability should be determined. As addressed in the Ruling, whether the impact fee ordinance applies to this project should be resolved at the land use review stage, meaning with the Special Permit. However, whether an exception applies must be later determined. As addressed in the conclusions, without an appeal of a Department exception determination, the Examiner lacks jurisdiction. 1.5 SEPA. The Department initially issued a Mitigated Determination of Non- Significance. Based on Applicant objection to a cultural resource survey condition, the Department reissued its threshold determination without the condition, based on a revised SEPA Checklist. With re-issuance on April 13, the day before the hearing, the appeal period had not closed, so the record had to be kept open for 14-days (until April 28),3 to allow the appeal period to run, and allow for record re-opening to address any appeal. No appeal was filed; SEPA review is complete. 1.6 Hearing. An open record public hearing was held April 14, 2021.Due to COVID- 19 restrictions, the hearing was conducted remotely, with the Examiner, Department, and Applicant calling in. Access information was available to the public to allow citizens to join via either a video link or telephone call-in. There were no reported technical difficulties during the call or afterwards. However, in case any citizens who wished to comment had difficulty calling in, to allow the SEPA appeal period to run, and to allow the parties time to potentially resolve a question on school impact fees, the record was kept open through April 28. The Department, through Mr. Adams, summarized the proposal. The Applicant presented through its counsel Mr. Fickes, Mr. Johnson, and Mr. Elsahili. At the hearing, the Applicant objected to constructing a concrete block wall, and provided information on landscaping. The Applicant also objected to school impact fee imposition. No citizen indicated a wish to comment. 1.7 Public Notice. Hearing notice was published in the Tri-City Herald, and mailed to property owners within 300 feet on March 25. No objections or concerns on notice were raised. Code notice requirements have been met.4 1.8 Utilities. Water and sewer are available from North Oregon Avenue via North Idaho Avenue. 1.9 Access. North Idaho Avenue via a 40 foot common access/egress easement along the north property line. 1.10 Landscaping. 1-gallon shrubs, 2.5 to 3.0 feet tall, on 3-foot centers around the entire site perimeter have been installed. They will grow about 2.5 feet in height per year. If maintained, the landscaping provides improved aesthetics. The Department proposed a concrete block wall to provide safety and privacy. With a plat, a block wall would be required given Oregon Avenue's major arterial and major truck route designations. The Applicant argued this is not a plat and the structure is legally non-conforming. However, the use is new, and must meet CUP compatibility and other requirements. 'WAC 197-11-680(3)(a)(vii). 4 Staff Report,p.4;Hearing Notice;PMC 25.200.070 and PMC 25.210.040.No notice concerns were raised. City of Pasco Hearing Examiner Page 2 of 8 Decision, Special Permit SP 2021-005 A concrete wall is reasonable given the heavy use of the arterial, to provide public safety and improve use compatibility with the neighborhood. But, it also makes little sense to remove the landscaping and replace it with a concrete block wall. While each serves useful purposes, the landscaping is particularly needed at this largely paved over site, offering relief from the surrounding concrete. And the trees will form a barrier to address safety, improve aesthetics, and provide some privacy. With proper maintenance, based on the record provided, the landscaping should not be removed and replaced with a block wall. 1.11 Parking. A 104-unit SRO facility has the potential to house 208 individuals. Hotels and motels require one parking space for each lodging room, while virtually all other residential units require two parking spaces per unit. There are 105 parking spaces for the facility, or about half the spaces required per unit for other housing types. Though this meets minimum SRO requirements which require "at least " one space per unit, it may fall short of demand. 1.12 Traffic. The project will produce traffic impacts greater than the existing use. The current property is an underperforming hotel now used for temporary housing. A transportation impact analysis was not prepared, so trip numbers are unknown. Traffic impact fees will be required to address traffic impacts, Ch. 3.40 PMC. As with school impact fees, the amount is determined administratively, with adjustments provided for in code, and determined by the Department Directors 1.13 Recreation. The residents will require recreation facilities to a degree greater than the current underperforming use. On-site recreation is being provided, and the Department Director has authority to provide credit for same in calculating the required impact fees due under Ch. 3.50 PMC.6 1.14 Schools. The Applicant viewed it likely most units would not have school-age children, but did not propose a covenant or other condition prohibiting or strictly limiting school-age children. Based on the record presented, it is likely that school-age children will be less than a standard apartment complex, but some impact is probable. Additional facts are required to determine actual impact levels. While the impact fee ordinance does apply, under Ch. 3.45 PMC, adjustments may need to be made based on unique circumstances. Under the City's code structure, whether an adjustment should be granted must be determined administratively, before an appeal is filed. 1.15 Conditions. To ensure project development consistent with City requirements and findings, the Department's proposed conditions should be imposed without substantive revision, other than the wall condition, which was revised to allow landscaping in lieu of the wall. Also, SRO code compliance should be confirmed, along with submission of property owner signature on the application. Except as the Decision revises it, the Staff Report is incorporated. 'PMC 3.40.090. 6 PMC 3.50.070. PMC 3.45.060. City of Pasco Hearing Examiner Page 3 of 8 Decision, Special Permit SP 2021-005 2. CONCLUSIONS 2.1 Single Room Occupancy Requirements. The City has adopted regulations "to allow single room occupancy (SRO) dwelling units within the City limits which provide high- density housing typically consisting of no more than two rooms per dwelling unit."8 "Single room occupancy" (SRO) shall be defined as a facility providing downsized dwelling units consisting of one to two rooms with occupancy per dwelling unit dictated by HUD guidelines. SRO facilities provide individuals with housing for a duration of 30 days or more. Kitchens/kitchenettes and/or bathrooms may be located in the units or be located centrally for communal use. In zoning districts which allow SRO housing via conditional use permit, the regulations contained herein shall be considered additional to those of the underlying zoning district. The provisions of this chapter shall prevail in the event of conflicting standards presented in the underlying zoning district regulations. SRO housing must meet all building and zoning standards as dictated by the PMC.9 SRO's are authorized in specified commercial zoning districts, including the C-3 General Business District zone,which applies to this site.10 SRO regulations require: (1) SRO facilities shall not be subject to density standards; (2) SRO facilities shall follow the Department of Housing and Urban Development's (HUD) occupancy guidelines for single- and double- occupancy units; (3) Single- and double-occupancy units shall house no more than two adults over the age of 18; (4) At least one off-street parking space per two units is required; (5) SRO facilities shall include 24-hour on-site management. A dwelling unit shall be designated for the manager; (6) Bathroom and kitchen/kitchenette facilities must be provided either within each dwelling unit or in a central location for common use with one full bathroom per every three units on a floor and one full kitchen per floor; (7) At least one handicapped accessible unit shall be required for every 20 units; 'PMC 25.162.010. 9 PMC 25.162.020. io PMC 25.162.020, .030. City of Pasco Hearing Examiner Page 4 of 8 Decision, Special Permit SP 2021-005 (8) One washer and dryer must be provided for every 20 units; (9) Mailboxes shall be provided for each unit; (10) Each SRO facility with 100 units or more shall have a minimum of 400 square feet of common indoor and/or outdoor recreational space; (a) For SRO facilities exceeding 150 units, an additional 10 square feet of recreational space per unit is required; (b) Landscaped areas less than eight feet in width shall not be considered recreational space; (11) All common areas shall comply with all applicable ADA accessibility and adaptability requirements.)l The Project can meet these requirements, though compliance will need to be confirmed. The Applicant stated that the required number of handicap units will be installed, and a full bathroom and kitchenette will be provided, which exceeds code. The Applicant is concerned about the need for 24-hour monitoring, but the Examiner cannot revise code requirements. During building permit review, code compliance will be confirmed. This includes confirming installation of the correct number of washers and dryers (the site plan identifies the laundry area, but not machine number) and mailbox construction. The property has an outdoor pool area which the site plan identifies as being 2,400 square feet, which is more recreational space than is required. But it will need to be confirmed that the pool area is properly maintained to serve as the recreational space, as the site plan depicts. If the Applicant confirms compliance during building permit review and before occupancy, these code requirements will have been met. 2.2. Special Permit Criteria. The Hearing Examiner may only grant a Special Permit if the proposal adequately addresses whether: (1) The proposal is in accordance with the goals, policies, objectives, maps and/or narrative text of the Comprehensive Plan; (2) The proposal will adversely affect public infrastructure; (3) The proposal will be constructed, maintained and operated to be in harmony with the existing or intended character of the general vicinity; (4) The location and height of proposed structures and the site design will discourage the development of permitted uses on property in the general vicinity or impair the value thereof; 11 PMC 25.162.040. City of Pasco Hearing Examiner Page 5 of 8 Decision, Special Permit SP 2021-005 (5) The operations in connection with the proposal will be more objectionable to nearby properties by reason of noise, fumes, vibrations, dust, traffic, or flashing lights than would be the operation of any permitted uses within the district; and (6) The proposal will endanger the public health or safety if located and developed where proposed, or in any way will become a nuisance to uses permitted in the district.12 The Comprehensive Plan designates the site for general business use and is implemented through the zoning code, which conditionally authorizes SROs. As the Staff Report addresses, the Plan encourages development of a wide range of housing types for all economic segments of the City's population consistent with the local and regional market. The project provides a housing option for lower-income small households, is designed to extend the life of an otherwise defunct hotel, and otherwise follows the Plan. Adequate sewer, water, and transportation facilities can support the facility. Parking is consistent with code, although there is a question on whether space number will fall short of demand. More generally, as long as the use is properly managed and operated, the use should be compatible with the surrounding area. With landscaping, the use will be better integrated into the surrounding area, and should not discourage development or impair land use values. Noise, fumes, vibrations, dust, traffic, and flashing lights, would be no greater than other permitted commercial uses within the district. With proper management, the proposal would not endanger the public health and safety, and if codes and project conditions are followed, will not constitute a nuisance. 2.3 Impact Fee Ordinance Applicability. The Examiner can determine the overall question of whether impact fees will apply to a project, in order to confirm impacts are addressed, including school impacts.13 This issue is easily dispensed with. The impact fee ordinance applies to any residential construction, including use changes. "Development activity means any residential construction, including the placement of a mobile home, or expansion of a building, structure or use, any change in use of a building or structure, or any change in the use of land that creates additional demand for school facilities."14 The proposed use is residential. And, it is a change from the hotel/temporary housing use now at the site. The impact fee ordinance applies. The Examiner can also determine whether any of the ordinance's exemption apply as the code does not require the Department to first decide the issue. There are seven exemptions from school impact fees. Six address age restricted housing for the elderly; rebuilding of units damaged by accident or catastrophe; condominium conversions; alternative mitigation; voluntary mitigation agreement; and, mobile home replacement. No party argued these exemptions apply. There is also an exemption which applies to the "[a]lteration, expansion, reconstruction, remodeling, or rebuilding of existing single-family or multifamily dwelling units, including 12 PMC 25.200.080. 13 PMC 25.162.030,25.200.080. 14 PMC 3.45.020. City of Pasco Hearing Examiner Page 6 of 8 Decision, Special Permit SP 2021-005 mobile or manufactured homes; provided, that no additional dwelling units are created."15 What is being altered or remodeled here are hotel/temporary housing units, not single family or multifamily dwelling units. None of the exemptions apply. A relief avenue is nevertheless still available. If a residential project will not have school- age children, or will have a substantially reduced number of children, an adjustment can be made. School impact fees may be adjusted in "[u]nusual circumstances demonstrated by the developer that adjustments to the school impact fee at the time the fee is imposed are necessary to accommodate unusual circumstances in specific cases to ensure that the impact fees are imposed fairly."16 Following school district consultation, the Department must first make this determination, which may then be appealed to the Examiner.'7 If an applicant wishes to place an impact fee issue before the Examiner, an adjustment request is made to the Department. If denied, or if a de facto denial issues through inaction, an appeal may be filed, and the Examiner would then acquire jurisdiction. In other words, if an applicant wished to put the issue put the issue before the Examiner, an avenue exists to accomplish that. In this case, this procedure could have been utilized. The Applicant could have utilized the procedure up front, at application, but elected not to. During the hearing process, the Examiner indicated the avenue remained open, should the Applicant wish to utilize it.18 The Applicant elected not to. The code's approach is consistent with state requirements, where it is recognized that impact fee amounts are vested at payment: The dispute in this case, at its essence, is over the timing of the fee's calculation. The Cities assert the calculation should be made when the building permit is issued; the Developers want it to occur at the time of the application. ... To freeze the calculation of the impact fee at the time of application would disconnect planning and financing from the actual effects of growth. The Legislature has stated that the indirect effects of growth can be recovered. If the fee were frozen, then new growth could take place without the developer paying its fair share for improving public facilities. The developer could be paying an impact fee that reflects a planning effort and a cost that is no longer relevant. The TIFs must be calculated when the growth is to occur, at the time of the building permits; otherwise cities would be underfunded to pay for the indirect costs of new growth.19 In sum, the impact fee ordinance does apply to the project, though adjustment may be appropriate to address the SRO project's "unusual circumstances." This is the first such project to be permitted in the City, and the record requires further development to resolve this issue. 's PMC 3.45.050(3). 16 PMC 3.45.060(1)(b). 17 PMC 3.45.060(3)and(4). 18 Preliminary Ruling(April 19,2021). 19 New Castle Invs. v. City ofLaCenter,98 Wash.App. 224,228 and 237,989 P.2d 569(1999). City of Pasco Hearing Examiner Page 7 of 8 Decision, Special Permit SP 2021-005 This analysis addresses school impact fees, as the Applicant focused its arguments on this issue at the hearing and in its written submissions. Similar provisions are available for park and traffic impact fees, including exceptions.20 However, without an appeal, the Examiner lacks jurisdiction, so no decision is made on whether any adjustments are in order. DECISION The Hearing Examiner, pursuant to the above Findings of Fact and Conclusions of Law, approves the requested Special Permit, subject to these conditions. 1. The Special Permit shall apply to Tax Parcel 113-481-144 and any subsequent subdivisions thereof. 2. No outdoor storage of equipment or materials shall be allowed. 3. The proposed block wall condition has been removed. In lieu of the block wall, the trees which have been planted, as the Applicant described, shall be maintained. 4. The Special Permit shall be null and void if all necessary building permits have not been obtained within two years of Special Permit approval. 5. The Special Permit shall be null and void if site is not constructed, maintained and operated in conformance with the above conditions. 6. To the extent the property owner has not provided a notarized signature on the application, that shall be provided to the Department within 14 days of Decision issuance. 7. During building permit review and prior to occupancy, the Applicant shall confirm compliance with all Ch. 25.162.040 PMC requirements consistent with Conclusion 2.1. Absent a timely appeal,this Decision is fmal.21 DECISION enter City of Pasco Hearing Examiner Susan Elizabeth Drummond 20 PMC 3.40.090(permitted adjustments for traffic impact fees);PMC 3.50.070(park impact fee reductions). 2'See Ch.36.70C RCW(establishing 21 day appeal period to superior court, and setting forth necessary petition for review contents, along with filing and service requirements). City of Pasco Hearing Examiner Page 8 of 8 Decision, Special Permit SP 2021-005