Now that one big-box retailer surprised Tacoma with its plans, the City Council wants to tighten the rules to make sure the next one fits in the neighborhood.
Last week council members had their first look at recommended changes to city code that affect large retail projects. Those proposals include requiring an additional permit, as well as much more public review for new or remodeled retail development.
The proposals are the result of the council’s emergency moratorium on large retail, enacted six months ago out of fear that a developer was planning a Walmart at Union and South 23rd streets.
The Walmart suspicions proved true, and that project is moving ahead because the plans “vested” before the moratorium took effect. The city continued its review of land-use code to better regulate large retail developments and minimize their potential impacts to neighborhoods.
“We do not want to discourage development,” Councilwoman Lauren Walker said in an interview last week. “The key issue is getting the kind of development that enhances the community.”
Business leaders said the proposals send a message, but it’s “keep out.”
The moratorium targeted retail uses larger than 65,000 square feet, but the proposals drop that threshold to 45,000 square feet in many areas. That’s the size of many grocery stores. Top Food in the Tacoma Central shopping center, near the site of the proposed Walmart, is about 58,000 square feet.
The businesses affected by the 45,000-square-foot threshold are a category that hasn’t even been discussed, said officials with the Tacoma-Pierce County Chamber, which opposes many of the new provisions. The changes also could affect how building owners re-use existing retail space, potentially impacting the Tacoma Mall and other shopping centers.
Some experts in commercial real estate say the recommendations are infused with the ghost of Walmart.
“They’re trying to keep one operator from coming into the marketplace,” said Rick Parks, a Seattle commercial broker who works with large retailers including Whole Foods and PetSmart. “It’s like saying, ‘I don’t want that one cherry tree, but I’m going to cut down the whole orchard in order to make sure that one cherry tree won’t go there.’”
Retail construction already is limited to certain areas of the city. As proposed, city ordinances would be changed to require large retail developments to get a conditional use permit. “Large” is defined as a minimum of 65,000 square feet in industrial areas, and 45,000 square feet most everywhere else.
Conditional use permits are common in residential districts, when people want to add buildings that fit in neighborhoods but aren’t allowed under current zoning – a school, a park, or a day-care center, for example. Those permits require public notices to groups within 400 feet and a review by a land-use administrator.
The proposed rules for large retail go further. Before even asking for a conditional use permit, large retail developers would be required to send public notices within 1,000 feet and meet with the community about the plans. Such developments later would go through a public hearing with a hearing examiner.
Increased public notification is one of the sticking points for business, and it was a direct result of public testimony in the Walmart case.
“A number of people testified that someone (shouldn’t be able to) come in and do this scale of project without having to talk to anyone in the community,” said city planner Brian Boudet.
During the study session last week where the proposals were unveiled, Councilman Joe Lonergan questioned the pre-application community meeting.
Retail is competitive, he said. “People are clamoring to work under the dark of night to not tip their hand to competitors before coming into a market.”
Councilman David Boe, an architect by trade, said he advises clients to be a good neighbor and share design plans whether it’s legally required or not.
Not revealing a tenant isn’t difficult, he said, by keeping the names off the drawings. His firm did just that in Gig Harbor with Wilco, an agriculture supply store.
“We spend a year in the public process. We labeled it an ag co-op, and discussed the use that way,” Boe said in an interview.
Parks, the Seattle broker, said most large retailers have standardized design. That will reveal the tenant, label or not.
“The layout of the store is on purpose. It’s designed to be replicated,” he said. “It just takes someone to know someone who understands the footprint to say ‘oh yeah, that’s probably XYZ.’”
The proposals also attempt to prevent a big-box surprise by requiring a conditional-use permit when a large retailer plans to expand in an existing building by 50 percent. This has several commercial property owners wondering if they’ll be able to do tenant improvements without triggering a new regulatory process.
City planner Boudet said the goal was to prevent sizing up, not subdividing down.
“In many ways the conditional-use permit is tied not to building but to use,” he said. “You could have a shopping center and as long as they’re all divided up, no problem. It’s the use itself. The big use. The big tenant.”
Chamber CEO Tom Pierson said these proposed rules are too vague. It could prevent Costco from remodeling, or smaller businesses from growing. With so much empty commercial real estate, why make it harder to reuse them?
Chamber staff member David Schroedel told the council last week that the language was unacceptable. Rules should be clear, “not subjective and mysterious when a developer comes in,” he said.
“If there are specific standards that the council or the planning commission would like to see, put them in writing. Put them in code. Make them regulations,” Schroedel said. “Don’t make it this amorphous cloud that developers have to wade into and spend lots of time and money and energy before knowing whether or not they’ll even be allowed to apply, rather than be approved.”
Several council members said in interviews they would take a look at clarifying this part.
QUALITY OF LIFE
Since Walmart announced its intentions for Tacoma, the debate has centered around quality of life concerns, such as traffic and noise, and underlying economic issues such as wages and benefits.
The Walmart developer first proposed a 760,000-square-foot medical campus. Traffic analyses submitted to the city for both projects show the medical office use would have created three times more traffic than the 154,000-square-foot Walmart.
During the study session, some council members questioned the city’s traffic analysis tools and other decision-making processes.
“What started this discussion was a simple U-turn,” said Ryan Mello, referring to the reason the Walmart developer’s project even came before the council. The council was asked to consider allowing a U-turn to help the development at South 23rd and Union, and a deeper look resulted in suspicion that Walmart was coming and the emergency moratorium.
“The council decides if a U-turn is allowed on a city street, but we don’t decide a lot of other issues such as when we’re going to turn an intersection into a five-way like at Sixth and Sprague. That’s a staff decision. And that doesn’t make sense to me,” Mello said.
“We need a long-term review so that all of this is not for naught,” he said.
In an interview, Councilman Jake Fey agreed. “We’re behind on our development regulations, and (instead of being) forward looking and anticipating what development will be, we’re behind.”
A study published by the American Planning Association in 2006 took an in-depth look at how cities can plan for large retail development. The study’s author, Jennifer Cowley, is a professor of city and regional planning at Ohio State University. She surveyed 217 planners from across the country to determine best practices for big-box planning.
Size thresholds and design standards are important, but understanding and predicting the underlying economics are key.
One of the study’s recommendations was for planners to develop an inventory of big-box retailers within the region, then use mapping technology to predict where the retailer will want to build next.
“The retailer has done their homework,” she said in an interview. “They know where they will locate their store.”
Another tool communities can use is an economic impact analysis. Communities in California, Ohio and Massachusetts have required developers to do such an analysis before being allowed to build. It shows how the new business might affect the local economy. It could analyze job creation, estimated wages, estimated tax revenue and estimated costs to the public in terms of increased traffic or police and fire needs.
If a new business ends up costing a community more than it brings in, the community can say no.
Discussion on the best way to balance Tacoma’s neighborhood and business interests continues this week. On Tuesday, the City Council is scheduled to hear the first reading of the ordinance about changes to large-scale retail requirements. The moratorium expires Feb. 29, so the council is trying to take action before then.
As for Tacoma’s planned Walmart, city staff is reviewing the project’s environmental determination. It will be finished soon, city planner Lisa Spadoni said in an email, and a building permit could be issued shortly thereafter.
EXISTING LARGE RETAIL USES IN TACOMA
Macy’s, Tacoma Mall, 255,000 s.f.
JC Penney’s, Tacoma Mall, 233,000 s.f.
Sears, Tacoma Mall, 180,000 s.f.
Costco, 37th & Steele, 152,000 s.f.
Nordstrom, Tacoma Mall, 144,000 s.f.
Fred Meyer, 19th & Stevens, 143,000 s.f.
Fred Meyer, 72nd & Pacific, 142,000 s.f.
Former Lowe’s, 80th & Hosmer, 138,000 s.f.
Lowe’s, 25th & Orchard, 131,000 s.f.
Target, Allenmore, 124,000 s.f.
Home Depot, Center & Mullen, 117,000 s.f.
Home Depot, 74th & Sprague, 110,000 s.f.
Forever 21, Tacoma Mall, 106,000 s.f.
K-Mart, 72nd & Portland106,000 s.f.
K-Mart, 6th & Orchard, 106,000 s.f.
Winco, 72nd & Hosmer, 103,000 s.f.
Fred Meyer, 19th & Mildred, 68,000 s.f.
Source: City of Tacoma