Hidden cost of side deals with developers frustrates Gig Harbor residents

A house under construction sits in contrast to a fully-build, occupied home in the McCormick Creek neighborhood in Gig Harbor. McCormick Creek residents have been working with the city after finding out a development agreement from 2017 may force them to pay for a public parking lot.
A house under construction sits in contrast to a fully-build, occupied home in the McCormick Creek neighborhood in Gig Harbor. McCormick Creek residents have been working with the city after finding out a development agreement from 2017 may force them to pay for a public parking lot.

A deal struck between the previous Gig Harbor City Council and a developer is causing new homeowners grief and fueling the current administration to fix what some see as a large loophole in the city’s code.

One of the campaign promises of Mayor Kit Kuhn and the council members elected in November was to look at Chapter 19 in the city code, titled “Development Agreements”, and make the code more restrictive.

“We were dead set to change development agreements,” Kuhn said. “Mostly Chapter 19.08. What section Chapter 19.08 says is a developer can deviate from the codes, regulation and ordinances if they give an amenity to the city. I ran on wanting to change that .. because it is opening Pandora’s box.”

The deal struck between McCormick Creek developer Bryan Stowe and the previous administration is a prime example.

McCormick Creek resident Tracie Markley and about 70 other residents feel trapped into paying for maintenance on a future public parking lot near the Cushman Trail and public ball fields, a public amenity Stowe promised to build for the city if he could develop 13 additional homes.

“I’m stuck in this stress trap,” Markley said. “I came here to bring less stress into my life.”

Stowe declined a request for comment from The Peninsula Gateway.

The agreement

According to city documents, the original plans for McCormick Creek included 185 lots, three of which were to be use as a future office space, storage units for neighborhood residents and one for a church.

In September 2017, Stowe requested permission to use the three lots to build 13 additional homes, creating a total of 118 homes in the neighborhood.

“The council asked, ‘What is the benefit to the city?’” Kuhn said. “And (Stowe) said, ‘Well, I can build a parking lot over a storm water pond and let it be public.’ The council OKed that.”

Stowe offered to cover the maintenance of the parking lot through the McCormick Creek Homeowners’ Association.

“But, the (development agreement) doesn’t say which homeowner’s association,” Kuhn said.

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This dead end on near the Cushman Trail and the Gig Harbor Little League Fields off of McCormick Road is the location of a proposed public parking lot, which would be maintained by McCormick Creek residents if a development agreement between the developer and the city remains. Danielle Chastaine Photographer

Stowe built phase one and phase two of the development in partnership with the Lennar Corporation. When it came time to build the 54 homes within phase three, the Gig Harbor hearing examiner told Stowe he must put information about the cost of the parking lot in the home titles before he could sell the homes.

That’s when trouble hit, according to Kuhn. Stowe, who controls the homeowner’s association until all the phases are complete, expected the association to cover all four phases of the project. This means all the residents who bought homes from phase one and two, before the development agreement was created and approved, would also be paying for the parking lot’s maintenance.

“His duty should have been to notify the homeowners,” Markley said. “And none of the council members asked, ‘Do the homeowners know about this?’”

Homeowners and council come together

McCormick Creek residents attended a number of City Council meetings regarding development agreements made between Stowe and the previous administration. In June, the residents helped convince the current council to amend an agreement that would have required a road to the nearby Costco be built through the neighborhood. Now residents say they are fighting to not pay for a parking lot that would require expensive liability insurance and consistent maintenance.

Markley moved to the development with her husband, Joshua Markley, and two children, after spending seven years on the East Coast while her husband served in the U.S. Navy. Markley said they wanted to move closer to doctors in Seattle and back to her hometown after her children were diagnosed with Tryptasemia Alfa syndrome, a rare hereditary disease that compromises the girls’ immune systems.

“We needed a newly constructed home, because I can’t take risks with the girls,” she said. “This was supposed to be our permanent place.”

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The cost to be a part of McCormick Creek Homeowners’ Association is $560 a year but that cost likely will rise once the parking lot is built, said Markley and other neighbors.

Maintenance of the parking lot includes cleanup, weatherization, landscaping, irrigation, sidewalk maintenance, lighting, wetland maintenance and security. Markley is trying to find out the cost of liability insurance for the parking lot.

“We have no control but full liability of a parking lot almost a quarter mile away from my home,” Markley said. “The parking lot will serve the city since it’s right near the Cushman Trail and the little league fields. It’s also near public bus stops. It won’t benefit homeowners in phases one and two.”

On Sept. 29, the city hosted an informal, public meeting with the council, Stowe and almost 70 McCormick residents to discuss what can be done about the development agreement.

“Stowe sees a couple of options. I see about five,” Kuhn said. “We are still discussing what the best options are.”

Development agreements were a talking point during the council’s six-month building moratorium, but no changes to the code have been made.

The council failed to approve a proposal brought by council members Jeni Woock and Jim Franich to completely repeal development agreements from city code last winter.

During the Jan. 22 meeting, Franich brought a copy of Chapter 19.08 to the meeting with his own changes. Some of those changes included language that would require more focus on traffic impacts, removing parts of the chapter that allow deviations from the code in downtown and decreasing the maximum approval time from 20 years to 10 years.

“When I was door-belling and polling during my campaign, my voters said they wanted everyone, including developers, to be treated fairly,” Woock said in February. “This chapter does not treat everyone fairly.”

Kuhn said development agreements can be useful and add benefits to the city. He cited a past development agreement between the city and Olympic Property Group, which gave seven acres to the city for site of the future Gig Harbor Sports Complex.

“The right-hand turn at the Chevron (on Stinson Avenue) is a good development agreement,” Kuhn said. “When they wanted to build, Chevron placed a new right-hand turn that helped the ease and flow of traffic.”

For the council, the McCormick Creek dispute is an example of how to evaluate development agreements in the future.

“There is a lot we can learn from this,” Kuhn said.

Danielle Chastaine: 253-358-4155, @gateway_danie