On Aug. 4, the Federal Way City Council will decide whether to pursue state funds that could push forward a mixed-use project at South 336th Street and Pacific Highway South.
A Local Revitalization Area (LRA) is proposed for the location, which is commonly known as Kitts Corner. If approved, the LRA will give city staff the go-ahead to pursue state-funded matching grants, which would then be used to help construct a commercial roadway connecting the area to Celebration Park and the Federal Way Community Center. The roadway is a vital component of the Federal Way Village project.
State encourages redevelopment
The state funds are offered as part of the recently adopted Local Revitalization Financing (LRF) statute. The legislation is similar to the state’s Local Infrastructure Financing Tool (LIFT), which Federal Way was awarded in 2007, and is presented as a matching grant. Not all applicants will receive the award.
“We don’t have to go through the really heavy competition we went through with LIFT,” city spokeswoman Linda Farmer said. “It’s a first come, first serve thing.”
The state money comes in the form of a sales and use tax credit. Each year, Federal Way would dedicate its matching funds and later be reimbursed by the state. Winning jurisdictions may receive up to $500,000 per year for up to 25 years. Federal Way plans to apply for $100,000 per year, Farmer said.
Federal Way Village
If the city secures the grant, a $2.1 million bond, on a 20-year payment plan, will follow, she said. Jurisdictions that create a revitalization area and have established plans for a redevelopment project that includes right-of-way improvements within the area are eligible for the LRF grant.
“The limiting factor is that you have to have a developer with a letter of intent and moving through the process,” Farmer said.
The funding is expected to be put toward the mixed-used Federal Way Village project — a public/private partnership at South 336th Street and Pacific Highway South. Jon Potter and his partner submitted their application for the development approximately one year ago. A combination of retail, office and residential spaces are planned for the 44-acre site.
The construction will come in phases. The development’s first phase includes the commercial roadway and its accompanying infrastructure, linking the property to Celebration Park, Potter said. This portion of the project is expected to cost between $2.7 million and $2.9 million, he said.
“It’s a real challenge to try to get that first phase under way without help on that commercial roadway,” Potter said. “That’s a fairly expensive project in and of itself.”
Potter and his partner have the city’s approval, but are awaiting funding and the market’s interest to move forward, he said. The partners anticipate the roadway will draw the attention of potential occupants and help propel the project.
“It’s all market driven, of course,” he said. “(The roadway) would draw more attention to the opportunity of the development of that site. I think that would help a lot in our marketing efforts.”
The city council will hold a public hearing on the topic at 7 p.m. Aug. 4 in council chambers at City Hall, 33325 8th Ave. S. A council meeting will follow. There, the group will vote on the proposed LRA.
