Mayor Offers Vulcan $5 Million Giveaway in South Lake Union
Mayor Nickels has sent legislation to the city council that would require developers who get waivers for building "significant additional development capacity" to return the favor by providing the city with public benefits—contributing money for low-income housing, for example. The resolution, known as "incentive zoning" legislation, was a no-brainer for Team Nickels. Deputy Mayor Tim Ceis told me last August: "That's the way it works. You [developers] get something. We [the city] get something in return."
Ridiculing developer complaints that public-benefit requirements "don't pencil out," Ceis said developers don't have much of a case given that the council passed incentive zoning for downtown last year and "there's no shortage of cranes there now—it worked."
However, Ceis's policy principles apparently don't apply to Vulcan, Paul Allen's development company. The mayor's office sent down a separate customized piece of Vulcan legislation that would allow the developer to double the size of its South Lake Union property between Terry and Boren avenues and John and Harrison streets, without having to make good on public-benefit requirements.
"Vulcan is getting a deal," says Council Member Richard Conlin. "They do better [with their customized legislation] than they would do under the mayor's incentive zoning proposal [for developers in general]."
Council Member Peter Steinbrueck agrees: "Absolutely," he hollers into the phone when asked if Vulcan's zoning waiver on the $300 million to $400 million project should qualify as "significant additional capacity." "There's hypocrisy going on here," he says. "There's a contradiction with what would be extracted under the mayor's own incentive zoning strategy."
Vulcan is developing the property into a seven-story building that will house Amazon.com. According to the resolution, Vulcan would get to develop four floors above current zoning guidelines, but would only have to compensate the city for two bonus floors. The difference could amount to as much as a $5 million loss to the city's low-income housing fund.
The Vulcan legislation will go before the council's land use committee on December 6, when Steinbrueck will propose amendments—including one that would force Vulcan to kick in another $2.6 million for low-income housing.
Of course, the Nickels legislation already demands about $5 million from Vulcan in exchange for giving the developer two extra floors. Many at City Hall, including the mayor's office, feel it's not worth losing that financial commitment (not to mention possibly botching the opportunity to have a vibrant business like Amazon.com at the center of a revamped South Lake Union), by holding Vulcan to the tougher standard it is seeking from other developers. "The loss of the proposal," Ceis told The Stranger, "would be a real tragedy. This is a lot of jobs."
However, Council Member Sally Clark points out that Vulcan has a plan B on the table: If the taller building plan falls through, Vulcan will offer the online retail giant a different swath of South Lake Union property for a corporate-campus-type setting.
Meanwhile, Ceis's point about jobs is an odd one. These aren't new jobs. Amazon is already headquartered in Seattle.
The mayor's office did not return follow-up calls for this story.