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June 28, 2018

Central Waterfront Park and LID Update

The City of Seattle is moving forward with a $688 million waterfront park and associated street improvements of which $200 million will be funded through a Local Improvement District (LID).  While this may not be news to most, it is critical to understand the process and property owner options for those that fall inside the LID boundary.

LID Assessments were announced on April 6, 2018, and the Special Benefit Study was released the first of May.  That document is prepared in support of the appraiser's opinion the 6,130 properties that are within the LID boundary will receive a special benefit totaling $414 million.  The City, in turn, determined the assessments based upon the percentage of benefit each property receives against $200 million, an amount the City has earmarked to be funded by the LID.  The City Council has already passed a resolution of intent to form the LID.

This does not mean that the LID has formally been formed.  During Q2 and through Q4 2018, property owners can submit written protests.  There will be a public hearing in Q3 and in Q4, where the Council will consider the formation of the LID.

In Q1 2019, a Final Special Benefit Study will be prepared where the appraiser considers then current market information and any changes to properties that might have been under construction and are now complete. The appraiser may also consider property owner input, but that is speculative at this time.  Then the Council considers resolution to begin the assessment roll process.  In Q2 2019, there will be public hearings to contest individual assessments followed by the potential adoption of an ordnance on the final assessment roll followed by one last public appeal period.

If all this passes, the collection of the assessments begins Q4 2019.

The Special Benefit Study may be flawed, and this could be challenged during the public hearing process.  There is a distinct difference between what is a special and general benefit. Special benefits are unique to a specific property whereas general benefits more typically benefit a larger community.  The LID study area may be so broad that all benefits are not special.

The LID cannot legally pass if property owners whose assessments total 60% or more of the $200 million oppose the LID.  A group of property owners in the early stages understand the impacts of the LID on their property and if they should assemble a challenge.

Property owners can challenge their assessment.  That is usually done through a valuation expert knowledgeable of the differences between special and general benefits. While that would not be until Q2 2019, it is best to be prepared and voice opinion early.

For more information or for assistance with your valuation advisory needs, please contact:

Peter K. Shorett, MAI, CRE, FRICS
Executive Vice President
Kidder Mathews Valuation Advisory
206.205.0201
pshorett@kiddermathews.com

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