HomeMy WebLinkAboutHE Determination SP 2021-011 Loyalty Inn SRO Conversion CITY OF PASCO HEARING EXAMINER
IN THE MATTER OF ) FINDINGS OF FACT,
CONCLUSIONS OF LAW,
DECISION AND CONDITIONS
SP 2021-011 ) OF APPROVAL
Ziad Elsahili/Fortify Holdings,LLC )
THIS MATTER having come on for hearing in front of the City of Pasco Hearing Examiner on
August 11,2021, the Hearing Examiner having taken evidence hereby submits the following Findings
of Fact, Conclusions of Law, and Decision and Conditions of Approval as follows:
I. FINDINGS OF FACT
1. PROPERTY DESCRIPTION:
1.1 Leal: Lots 1 &2, Short Plat 2016-26 and Lot 2, Short Plat 2010-08 Section 30,
Township 9 North Range 30 East, W.M., in Pasco WA(Parcels 112230018,
112230019, 112230016).
1.2 General Location: 1800, 1825 & 1905 W Lewis Street,Pasco WA 99301.
1.3 Property Size: Approximately 3.36 acres(146,551.99 Square Feet).
1.4 Applicant: Ziad Elsahili/Fortify Holdings, LLC, 17933 NW Evergreen Pl.,
Beaverton, Oregon 97006.
2. ACCESS: The site has access from West Bonneville Street,West Lewis Street and North
18`h Avenue.
3. UTILITIES: Water is available from West Bonneville Street and North 18th Avenue. Sewer
service is located in North 18`x'Avenue.
4. LAND USE AND ZONING: The site is currently zoned C-3 (General Business)with a
concomitant agreement, and is occupied by a motel; Surrounding properties are zoned and
developed as follows:
NORTH: R-,R-2,R-3 &C-1 SFDUs; Multi-Family; Daycare
EAST: C-1,R-1 &O Restaurant; SFDUs; Daycare
SOUTH: C-1 Commercial;Vacant
WEST: C-1 Commercial; Vacant
5. COMPREHENSIVE PLAN: The Comprehensive Plan designates the site for"Mixed
Residential/Commercial."
5.1 Goal LU-2: maintain established neighborhoods and ensure new neighborhoods are
safe and enjoyable places to live.
5.2 Goal H-1: encourage housing for all economic segments of the city's population.
5.2.1 Policy H-1-A: Medium- and high-density housing should be located near
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arterials and neighborhood or community shopping facilities and
employment areas.
5.2.2 Policy H-1-B: Encourage the location of medium- and high-density housing
in locations that will avoid the need for access through lower density
residential neighborhoods.
5.2.3 Policy H-1-C: Support dispersal of special needs housing throughout the
community.
5.2.4 Policy H-1-D: Avoid large concentrations of high-density housing.
5.3 Goal H-2: strive to maintain a variety of housing consistent with the local and
regional market:
5.3.1 Policy H-2-A: Allow for a full range of residential environments including
single-family homes, townhouses, condominiums, apartments, and
manufactured housing; Policy
5.4 Goal H-4: ENCOURAGE HOUSING DESIGN AND CONSTRUCTION THAT
ENSURES LONG TERM SUSTAINABILITY AND VALUE.
5.4.1 H-4-A: Encourage innovative techniques in the design of residential
neighborhoods and mixed-use areas to provide character and variety in the
community;
5.5 Goal H H-5: SUPPORT EFFORTS TO PROVIDE AFFORDABLE HOUSING TO
MEET THE NEEDS OF LOW- AND MODERATE-INCOME HOUSEHOLDS IN
THE COMMUNITY.
5.5.1 Policy H-5-A: Residential neighborhoods and mixed-use areas should exhibit
a consistent level of quality and appearance.
5.5.2 Policy H-5-C: The City shall work with public and private sector developers
to ensure that lower income housing is developed on scattered sites and in
such a manner that it blends in with surrounding neighborhoods.
6. ENVIRONMENTAL DETERMINATION: The City of Pasco is the lead agency for this
project. Based on the SEPA checklist, the adopted City Comprehensive Plan, City
development regulations,and other information,a threshold determination resulting in a
Determination of Non-Significance (DNS)was issued for this project on 8 July 2021, under
WAC 197-11-158.
7. PROPOSAL: Ziad Elsahili, in behalf of Fortify Holdings, LLC, has submitted a Special
Permit application (SP 2021-011) for the conversion of a motel into 161 long-term Single-
Room Occupancy (SRO) units.
8. PROPERTY DESCRIPTION: The site of the proposed development is located at 1800,
1825 & 1905 W Lewis Street (Parcels 112230018, 112230019, 112230016), and is part of
Short Plat 2016-26 and, Short Plat 2010-08; the site contains approximately 3.36 acres
(146,551.99 Square Feet).
9. HISTORY: The site was annexed in 1961 and developed in 1966 with a motel. In 1966
Lewis Street was a main route through the community and consequently the applicant's
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property was well suited for a motel. Six of the original eight motels along Lewis Street have
been either demolished or repurposed.
10. In addition to the decline in room rentals at the motel property management issues have also
been a concern. There have been at least 25 complaints and code enforcement cases filed
against the property since 2005, the latest complaints/cases in the current year. Most of the
cases are nuisance cases involving unsanitary conditions, weeds trash and general property
maintenance issues. There have also been building and licensing issues at the property.
11. The property was annexed in 1961 (Ordinance 1027) and zoned C-1 (Ordinance 1028), but
not developed with a motel until 1966. The site was rezoned in 2016 to C-3 with a
concomitant agreement,with conditions as follows:
11.1 Land uses shall be limited to those permitted under the"O"Office District and the C-
I Retail Business District plus the rental of domestic trucks and trailers not exceeding
26 feet in length.
11.2 No more than 12 rental vehicles are permitted on-site per day.
11.3 All other C-3 uses are prohibited.
12. The site is occupied by three two-story structures comprising 81,198 square feet of motel
space, built in 1966. The site has operated under the name of Val-U Inn Motel and Loyalty
Inn.
13. A fire destroyed the pool area in 2012,during a renovation attempt by the current owner.
14. Applicant has proposed the following:
14.1 "Fortify Holdings, LLC is a prominent owner and developer of multifamily housing
based in Portland Oregon. We intend to purchase the Loyalty Inn, located at 1800,
1825 and 1905 W Lewis Street in Pasco WA and convert the property from a(poorly
performing & under-utilized) motel to single-room occupancy (SRO) residential,
providing the City of Pasco more dwelling units within the city center. No exterior or
structural modification will be made - Existing units and unit configuration will be
maintained."
15. Applicant's characterization of the facility as a "poorly performing & underutilized" is
supported by various recent online hotel reviews.
16. PASCO MUNICIPAL CODE: In 2019 the Pasco City Council approved Ordinance 4425
regarding the regulation of SROs; this ordinance became Pasco Municipal Code Chapter
25.162.
17. PMC 25.162.020 defines an SRO 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."
18. According to PMC 25.162.030 SROs may be approved via conditional use permit in the C-1
(Retail Business), C-2 (Central Business District), and C-3 (General Business District) zones
of the City.
19. PMC 25.162.040 specifies development standards for all SROs, as follows:
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19.1 SRO facilities shall not be subject to density standards;
19.2 SRO facilities shall follow the Department of Housing and Urban Development's
(HUD) occupancy guidelines for single- and double-occupancy units;
19.3 Single- and double-occupancy units shall house no more than two adults over the age
of 18;
19.4 At least one off-street parking space per two units is required;
19.5 SRO facilities shall include 24-hour on-site management. A dwelling unit shall be
designated for the manager;
19.6 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;
19.7 At least one handicapped accessible unit shall be required for every 20 units;
19.8 One washer and dryer must be provided for every 20 units;
19.9 Mailboxes shall be provided for each unit;
19.10 Each SRO facility with 100 units or more shall have a minimum of 400 square feet of
common indoor and/or outdoor recreational space;
19.10.1 For SRO facilities exceeding 150 units, an additional 10 square feet of
recreational space per unit is required;
19.10.2 Landscaped areas less than eight feet in width shall not be considered
recreational space;
19.11 All common areas shall comply with all applicable ADA accessibility and
adaptability requirements.
20. 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. [Ord. 4425 § 1, 2019.]
21. According to both HUD and PMC 25.162.040 each unit "shall house no more than two adults
over the age of 18;" as such the 161-unit facility has the potential of housing 322 individuals
full-time (Applicant claims a maximum of 199 on the SEPA checklist), as opposed to the
fewer periodic transient clients, as originally designed; according to PMC 25.185.170
"Required off-street parking," motels and hotels require only one space for each lodging
room and one space for every two employees, while all other residential units require two
spaces per unit. This potential increase in full-time occupancy may present a parking issue,as
the current on-site parking for the facility contains approximately 165 spaces, or slightly over
Yz the required parking per unit for any other housing type. The SRO ordinance requires at
least one off-street parking space per two units--or Y4 that required by other housing types—
but it does not specify an upper limit the city may require. Thus, if parking becomes a
problem the city may elect to revisit the Special Permit within a time period stated in the
Special Permit conditions.
22. As per PMC 3.45.040, "[e]ach development activity within the service area, as a condition of
approval, shall be subject to the school impact fee established pursuant to this chapter. . .. The
school impact fee shall be required prior to the issuance of building permits, unless deferred
as provided below. The amount of the school impact fee shall be based on the fee schedule in
effect at the time of the building permit application."
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23. Applicant has requested reduced school impact fees due to the anticipated nature of SRO
demographics (See PMC 25.162.040(3)cited above).
24. The standard school impact fee for multi-family units is $4,525 per unit. As per Pasco
Municipal Code (PMC) 3.45.060(1) "Permitted adjustments," The current school impact fee
may be adjusted by the Director of Community and Economic Development, if one of the
following circumstances exists:
24.1 The developer demonstrates that an impact fee assessment was improperly
calculated; or
24.2 Unusual 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.
25. PMC 3.45.060(3)further states as follows:
25.1 In all cases where the developer requests an adjustment or exemption from fees, the
Director of Community and Economic Development shall consult with the District
and the District shall advise the Director of Community and Economic Development
prior to the Director making the final impact fee determination. The Director of
Community and Economic Development shall consider, in addition to the advice of
the District, any studies, data, calculations and reports provided by the developer as a
part of its request for a fee calculation adjustment prior to making the final impact fee
determination.
26. The Director consulted with the School District on the fee schedule for a similar project
located on North Oregon Avenue (SP 2021-005. Rodeway Inn), and they came to an
agreement for an adjusted fee of $600 per unit fee for those units. This agreement may be
considered a precedent for SRO development in the City. Staff anticipates a similar
agreement for this development.
27. The Public Notice was mailed out and published in the Tri-City Herald on 20 July 2021.
28. Applicant to convert a motel into 161 long-term Single-Room Occupancy(SRO)units.
29. The site is located at 1800, 1825 & 1905 W Lewis Street.
30. The site contains approximately 3.36 acres.
31. The site was annexed in 1961.
32. The site was zoned C-1 upon annexation.
33. The site was developed with a motel in 1966.
34. In 1966 Lewis Street was a main route through the community.
35. Six of the original eight motels along Lewis Street have been either demolished or
repurposed.
36. There have been at least 25 complaints and code enforcement cases filed against the property
since 2005.
37. The site was rezoned in 2016 to C-3 with a concomitant agreement
38. The concomitant agreement conditions included the following:
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38.1 Land uses shall be limited to those permitted under the"O" Office District and the C-
1 Retail Business District plus the rental of domestic trucks and trailers not exceeding
26 feet in length.
38.2 No more than 12 rental vehicles are permitted on-site per day.
38.3 All other C-3 uses are prohibited.
39. The site is occupied by three two-story structures comprising 81,198 square feet of motel
space.
40. A fire destroyed the pool area in 2012.
41. In 2019 the Pasco City Council approved SRO Ordinance 4425 (PMC 25.162)
42. PMC 25.162.020 defines an SRO as follows:
42.1 "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."
43. SROs must be approved via Special Permit review.
44. SROs may be located in C-1, C-2, and C-3 zones(PMC 25.162.030)
45. Development standards for all SROs are as follows (PMC 25.162.040):
45.1 SRO facilities shall not be subject to density standards;
45.2 SRO facilities shall follow the Department of Housing and Urban Development's
(HUD) occupancy guidelines for single-and double-occupancy units;
45.3 Single- and double-occupancy units shall house no more than two adults over the age
of 18;
45.4 At least one off-street parking space per two units is required;
45.5 SRO facilities shall include 24-hour on-site management. A dwelling unit shall be
designated for the manager;
45.6 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;
45.7 At least one handicapped accessible unit shall be required for every 20 units;
45.8 One washer and dryer must be provided for every 20 units;
45.9 Mailboxes shall be provided for each unit;
45.10 Each SRO facility with 100 units or more shall have a minimum of 400 square feet of
common indoor and/or outdoor recreational space;
45.10.1 For SRO facilities exceeding 150 units, an additional 10 square feet of
recreational space per unit is required.
45.10.2 Landscaped areas less than eight feet in width shall not be considered
recreational space.
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45.11 All common areas shall comply with all applicable ADA accessibility and
adaptability requirements.
45.12 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. [Ord.4425 § 1,2019.]
46. According to both HUD and PMC 25.162.040 each unit"shall house no more than two adults
over the age of 18;"
47. The 161-unit facility has the potential of housing 322 individuals full-time
48. Applicant claims a maximum of 199 on the SEPA checklist,
49. According to PMC 25.185.170 "Required off-street parking," motels and hotels require only
one space for each lodging room and one space for every two employees,
50. All other residential units require two spaces per unit.
51. The current on-site parking for the facility contains approximately 165 spaces,
52. The SRO ordinance requires at least one off-street parking space per two units-'/4 that
required by other housing types
53. If parking becomes a problem the city may elect to revisit the Special Permit within a time
period stated in the Special Permit conditions.
54. As per PMC 3.45.040, "[e]ach development activity within the service area, as a condition of
approval, shall be subject to the school impact fee established pursuant to this chapter. . ..The
school impact fee shall be required prior to the issuance of building permits, unless deferred
as provided below. The amount of the school impact fee shall be based on the fee schedule in
effect at the time of the building permit application."
55. The standard school impact fee for multi-family units is $4,525 per unit.
56. Applicant has requested reduced school impact fees due to the anticipated nature of SRO
demographics (See PMC 25.162.040(3) cited above), and in alignment with a fee reduction
agreement between the City and applicant entered into for a similar project located on North
Oregon Avenue (SP 2021-005; Rodeway Inn).
57. As per Pasco Municipal Code (PMC) 3.45.060(1) the current school impact fee may be
adjusted by the Director of Community and Economic Development, if one of the following
circumstances exists:
57.1 The developer demonstrates that an impact fee assessment was improperly
calculated; or
57.2 Unusual 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.
58. PMC 3.45.060(3) further states "In all cases where the developer requests an adjustment or
exemption from fees, the Director of Community and Economic Development shall consult
with the District and the District shall advise the Director of Community and Economic
Development prior to the Director making the final impact fee determination. The Director of
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Community and Economic Development shall consider, in addition to the advice of the
District, any studies, data, calculations and reports provided by the developer as a part of its
request for a fee calculation adjustment prior to making the final impact fee determination.
59. The Director consulted with the School District on the fee schedule for a similar project
located on North Oregon Avenue (SP 2021-005; Rodeway Inn).
60. The Director and School District came to an agreement for an adjusted fee of$600 per unit
fee for the Rodeway Inn SRO conversion located on North Oregon Avenue.
61. An open record public hearing after due legal notice was held August 11, 2021 via Zoom
videoconference.
62. Appearing and testifying on behalf of the applicant was Robert Johnson. Mr. Johnson
testified that he was an agent authorized to speak on behalf of the property owner and
applicant. Mr. Johnson indicated that the Applicant's attorney was to be in attendance, but
was not able to join the hearing. Mr. Johnson indicated that he had not seen the staff report or
the Conditions of Approval.
63. No member of the public appeared at the hearing.
64. At the conclusion of this hearing, the Hearing Examiner kept the record open until 5:00 p.m.
August 13, 2021.
65. On August 12, 2021, attorney for the Applicant, Mark Fickes, emailed a letter to the Hearing
Examiner. This letter is admitted into the record.
66. The Applicant had requested that the school impact fees be reduced. The Hearing Examiner
finds that school impact fees are allowed for residential uses. The Hearing Examiner has set
forth a Condition of Approval that this impact fee shall be in an amount agreed to by the City
of Pasco.
67. Without the block wall as required by Condition No. 3, the site will remain visible to the
travelling public, street noise may interfere with the occupants use of the property, and the
wall will enhance the safety of the occupants.
68. The staff report, application materials, agency comments and the entire file of record were
admitted into the record.
69. Any Conclusion of Law that is more correctly a Finding of Fact is hereby incorporated as
such by this reference.
II. CONCLUSIONS OF LAW
1. As conditioned,the proposed use is consistent with the Comprehensive Plan as follows:
1.1 Goal LU-2 suggests Pasco seek to "maintain established neighborhoods and ensure
new neighborhoods are safe and enjoyable places to live;" The proposal is located in
a mixed residential/commercial neighborhood.
1.2 Goal H-1 requires to seek to encourage housing for all economic segments of the
city's population; SROs would target a low-income demographic which might
otherwise be on the streets.
1.2.1 Policy H-1-A notes that "medium- and high-density housing should be
located near arterials and neighborhood or community shopping facilities and
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employment areas." The site is adjacent two arterial streets: West Lewis
Street, and 20"'Avenue.
1.2.2 Policy H-1-B directs the City to "encourage the location of medium- and
high-density housing in locations that will avoid the need for access through
lower density residential neighborhoods." The site is adjacent two arterial
streets: West Lewis Street, and 20"'Avenue.
1.2.3 Policy H-1-C suggests the City "support dispersal of special needs housing
throughout the community." Building permits are being secured for the
Catholic Family Charities Pasco Haven—a four-story supportive housing
complex—southeast of the site across West Lewis Street.
1.2.4 Policy H-1-D advises the City to "avoid large concentrations of high-density
housing. Building permits are being secured for the Catholic Family
Charities Pasco Haven—a four-story supportive housing complex—southeast
of the site across West Lewis Street.
1.3 Goal H-2 encourages the City to "strive to maintain a variety of housing consistent
with the local and regional market." Large-scale hotel/SRO conversions are a fairly
new variety of housing in the city of Pasco.
1.3.1 Policy H-2-A requests the City "allow for a full range of residential
environments including single-family homes, townhouses, condominiums,
apartments, and manufactured housing." SRO's are located along the
spectrum range of residential environments listed above.
1.4 Goal H-4 instructs the City to "encourage housing design and construction that
ensures long term sustainability and value." Extending the life of an otherwise
defunct hotel probably qualifies as ensuring long-term sustainability and value.
1.4.1 Policy H-4-A directs the City to "encourage innovative techniques in the
design of residential neighborhoods and mixed-use areas to provide character
and variety in the community." SRO conversions are locally innovative and
provide a unique character to the area.
1.5 Goal H H-5 advises the City to "support efforts to provide affordable housing to meet
the needs of low- and moderate-income households in the community." The present
application would help provide affordable housing for small, 1- to 2-person
households.
1.5.1 Policy H-5-A specifies that "residential neighborhoods and mixed-use areas
should exhibit a consistent level of quality and appearance."Except for long-
term parking of client vehicles, the external appearance of this development
should not change substantially.
1.5.2 Policy H-5-C declares that"the city shall work with public and private sector
developers to ensure that lower income housing is developed on scattered
sites and in such a manner that it blends in with surrounding neighborhoods."
Except for long-term parking of client vehicles, the external appearance of
this development should not change substantially.
2. As conditioned,the proposed use will not adversely affect public infrastructure because:
2.1 Conversion from transient housing to long-term housing will require the addition of
kitchen and potentially laundry facilities in each unit, increasing power demand from
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the original design.Traffic generation may be lower than transient uses,given the
target demographic, but would be more consistent than an off-and-on seasonal
transient use such as a hotel/motel.
3. As conditioned,the proposed use will be constructed,maintained,and operated to be in
harmony with existing or intended character of the general vicinity because:
3.1 The general vicinity is transient accommodations among a mix of residential and
commercial uses; use would be more consistent than an off-and-on seasonal transient
use such as a hotel/motel.
4. As conditioned, the location and height of proposed structures and the site design will not
discourage the development of permitted uses on property in the general vicinity or impair
the value thereof because the Applicant is proposing to renovate interiors only,there would
be no increase in height.
5. As conditioned, the operations in connection with the proposal will not 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 because:
5.1 No uses are proposed for the project (either in the building or at outside areas) that
would 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 use within the land use designation. People and vehicles visiting the
proposed site are anticipated to be similar to or less intense than other uses that would
be permitted for this property. The proposed operations for the project are to be
conducted primarily within the building with some outdoor open spaces
6. As conditioned, the proposed use will not endanger the public health or safety if located and
developed where proposed, nor in any way will become a nuisance to uses permitted in the
district because:
6.1 No uses are proposed for the project (either in the building or at outside areas) that
would endanger the public health or safety more than would be the operation of any
permitted use within the land use designation. The proposed use is anticipated to be
less intense than other uses that would be permitted for this property.
7. Any Finding of Fact that is more correctly a Conclusion of Law is hereby incorporated as
such by this reference.
M. DECISION
Based on the above Findings of Fact and Conclusions of Law, the Hearing Examiner APPROVES
Application SP 202 1-011-Ziad Elsahill, subject to the following Conditions of Approval.
IV. CONDITIONS OF APPROVAL
1. The Special Permit shall apply to tax Parcels 112230018, 112230019, 112230016 and any
subsequent subdivisions thereof.
2. No outdoor storage of equipment or materials shall be allowed.
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3. An architectural block wall with a minimum height of 6 feet,shall be installed along the West
Lewis Street property line and 10 feet behind the North 18'h Avenue frontage property line.
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. The Appellant shall pay school impact foes as agreed to by the City of Pasco.
Dated this 16th day of August,2021.
;drew
OF PASCO HEARING EXAMINER
00
l'
L. Kottkamp
Absent a timely appeal,this Decision is final'
' See Ch.36.70C RCW(establishing a 21 day appeal period to superior court,and setting forth necessary
review contents,along with filing and service requirements).
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