Councilmembers present: Donald MacGilvra, Alan Kiest, Peggy Gerdes, Carolyn Armanini, Dwight Thompson, Mary Jane Goss, Nate Herzog

Staff present: David R. Hutchinson, Mayor; Douglas Jacobson, City Administrator; Michael Ruark, City Attorney; John Rogers, Police Chief; Sarah Phillips, Community and Government Affairs Manager; Ty Peterson, City Planner; Evelyn Jahed, Deputy City Clerk

Others present: 25 visitors

• PUBLIC HEARING
• Siting and Financing City Hall

Mayor Hutchinson opened the public hearing on siting and financing City Hall at 7:00 p.m.

Hutchinson gave a brief background on the history of the siting and financing of the new city hall.

Keith Dutson, 19725 42nd Ave NE, said he lives near the interim city hall and commented that he would like the city to consider the Horizon View site as a last alternative for siting the new city hall. He said he appreciated the signs used for the public to direct them to the interim city hall because he also uses these signs to tell people where he lives. He said he would like the city to site the new city hall at the Towne Centre.

In response to a question from Cmbr. MacGilvra, Dutson said he did not want to see taxes raised in order to build a new city hall but is comfortable with the idea of selling the Horizon View site. He said that developers could build new homes on this site and that he estimated the city could probably recoup about 60 percent of the purchase cost of the property.

There being no further comments, the public hearing on the siting and financing city hall was closed at 7:10 p.m.

• CALL TO ORDER

Hutchinson called the regular meeting to order at 7:30 p.m.

Hutchinson noted that Cmbr. Kiest would like to go on record with his comments on Ordinance 799/Establishing Utility Tax prior to leaving the meeting at 8:00 p.m. tonight. No objection was raised when Hutchinson proposed that the public hearing on the proposed tree removal and replacement ordinance be postponed until later in the meeting.

• FIRST READING CALENDAR
• Ordinance 799/Establishing Utility Tax

Hutchinson said this ordinance was suggested because of the potential loss of revenue, estimated at $1.3 million, if Initiative 695 is approved by the voters. He noted that the council has adopted a resolution in opposition to Initiative 695. Hutchinson said that a utility tax is one of the measures that the council is considering to replace a portion of the revenue lost if I-695 is approved.

MacGilvra moved to advance Ordinance 799/Establishing Utility Tax to the second reading calendar. Cmbr. Kiest seconded. The motion carried unanimously.

• SECOND READING CALENDAR
• Ordinance 799/Establishing Utility Tax

Hutchinson said that Ordinance 799/Establishing Utility Tax will be taken out of order to allow Cmbr. Kiest's comments to be included in the record prior to his departure.

Cmbr. Kiest said he supports the administration's proposal for adoption of this ordinance and noted the budgetary implications if Initiative 695 is approved by the voters. If I-695 is approved, he said the council will need additional public hearings, and difficult choices will remain to be made. He said the downsizing of boards and commissions must be considered, and there will be some substantial reductions in programs and activities. He said the city would lose 25 percent of its general fund, and, although the utility tax revenue will cover only a small part of lost revenue, the city will need this revenue as a cushion. He added that more policy decisions will be made for the year 2000.

MacGilvra said he agreed with Kiest's remarks. He noted the payback schedule for outstanding interfund loans and other financial issues that staff is addressing. He said he supports adoption of this ordinance so that the city has this revenue source available if it becomes necessary.

Cmbr. Gerdes said the intent of Initiative 695 was to reduce taxes, but the real effect will be far greater, especially for small cities. She noted that the city of Newcastle is discussing a utility tax. Gerdes said Ordinance 799 will recoup a small amount of the lost revenue if Initiative 695 is approved by the voters.

Cmbr. Thompson said the council and the mayor must look very carefully at the services provided by the city. He discussed costs associated with planning department services and law enforcement and detention. He said if 695 passes, the city will lose 20 percent of its general fund revenue, and this utility tax alone will not make up the difference. Thompson noted that the council has been working to increase staff salaries to market levels and established social security replacement program for non-represented employees in the 1999 budget. Thompson said he voted against the utility tax twice in past years, but he will vote for it tonight. Finally, he said this ordinance does allow for a referendum process if citizens feel one is needed.

Cmbr. Armanini said the potential impacts of 695 are greater for Lake Forest Park than most municipalities and said that this cannot be ignored. The unfortunate thing about I-695 is it shifts the tax burden away from those most able to afford it. She voted against a utility tax increase three times, but circumstances are different this time, and this has been a real challenge for her. She said our residents have already been paying a tax to the electric utility; and this tax will apply to telephone, gas, and other utilities. If 695 fails, she will vote to reduce or eliminate the burden of the utility tax on our residents.

Cmbr. Kiest exited the meeting at 7:55 p.m.

Cmbr. Goss said the city must look at ways of reducing costs, such as contracting for services, rather than focusing on increasing revenue. She is undecided about her position on the proposed utility tax.

Armanini requested that the council return to the original order of the meeting agenda.

• PUBLIC HEARING
• Proposed Tree Removal and Replacement Ordinance

Hutchinson opened the public hearing on the Proposed Tree Removal and Replacement Ordinance at 8:00 p.m.

Armanini briefly gave a history of the urban forestry committee and the proposed ordinance that is on the agenda tonight. She said there are clear public benefits in preserving the functions of trees in the city of Lake Forest Park.

Wayne Bendixsen, 18807 26th Ave. NE, said he is satisfied with the way we handle the trees now but was not satisfied with the ordinance and felt it was not easily understood.

Dennis Wick, 19804 47th Ave NE, said he didn't think this ordinance was needed, and felt it would be really difficult to enforce. He said this is a mature city, and there will be some development, but felt to regulate and control this is not reasonable. He said he disagreed with Cmbr. Armanini that trees control runoff. He said he doesn't understand how this law works and felt it is very confusing.

In response to a question from Thompson, Wick indicated that he did not know what the current ordinance is regarding trees.

In response to a question from MacGilvra, Armanini commented on the current tree regulations and said that the Planning Department would have more information on this with regard to wetlands and sensitive areas.

Carol Dahl, 14828 - 39th Ave NE, commended the Urban Forestry Committee for their vision and their commitment to their goals. She said she is here to fully endorse the tree removal and replacement ordinance that has been drafted and stated that our parks and community need our trees. She said it is important to preserve our environment and the health of our community, and she fully supports their effort.

Mamie Bolender, 16730 32nd Pl. NE, said she is here on behalf of the Lake Forest Park Stewardship Foundation and said they fully endorse the tree ordinance. She said this ordinance is very important in controlling the streams and the health of the salmon habitat. She said it is much easier to preserve what we have than to recreate it.

Liane Newman, 16715 32nd PL NE, said she strongly supports this tree ordinance and discussed the flooding that happened in the city two years ago. She also discussed the increased water going down 33rd Ave NE, and she said that development does make a difference.

Tim Hohn, 18923 Forest Park Drive NE, said he is a faculty member at Edmonds Community College and a curator at the Arboretum, and a horticulturist. He said he is thrilled to see this ordinance and supports all the endorsements heard here tonight. He stressed that it is important that the city of Lake Forest Park be the leader in preservation of trees. He said one of the reasons for moving to Lake Forest Park is the trees, and he supports this effort.

Gunter Hertling, 4015 NE 196th St, said he has been a resident of Lake Forest Park since 1962, and that he is here because of our natural habitat forest environment. He said he is a member of the Audubon society and is proud to be an advocate of this proposed legislation. He said some of the pockets in the city need to retain the greenery and felt this ordinance must pass although he felt it to be a little wordy.

Mary Fung Koehler, 4652 NE 201st Pl., said she owns four pieces of property in the City of Lake Forest Park, and expressed her concerns regarding the removal of 20 trees by the city of Seattle. She also discussed her concerns on the legal fees the city paid in preparing this ordinance.

Armanini clarified that no legal fees were incurred in preparing this proposed ordinance because it was drafted by volunteers serving on the Urban Forestry Committee.

Thompson applauded and thanked Cmbr. Armanini and the Urban Forestry Committee for their work on the ordinance.

Roger Olstad, 20143 53rd Ave NE, chair of the Environmental Quality Commission (EQC), said the proposed ordinance is an excellent piece of work and thanked Cmbr. Armanini for her leadership on this effort. He said that EQC has reviewed the ordinance and fully endorses this document.

Bill Currie, 3311 NE 181st Street, said he didn't realize this ordinance was under consideration and said he is interested as a Water District No. 83 commissioner. He said the water district has been faced with significant problems with alders in the watershed area and has applied for a permit to remove the trees. He asked about tree replacement requirements and expressed concern regarding replacement costs.

Susanne Jezerinac, 4630 NE 178th Street, said she applauds the efforts of the committee in preparing this ordinance and said she is in favor of it. She said that trees have a positive impact on air, water, and aesthetic qualities of the community. She noted that she had come before council in the past when a developer near her home had cut down a tremendous amount of trees. She said she disagreed with the gentleman who said this ordinance was not needed in our city and reiterated the saying that "we don't know what we've got until it's gone."

Shawn Jezerinac, 4630 NE 178th Street, said he wished their two children were here to convey to council how the removal of the trees next to their property had affected them.

James Apsitis, 3502 NE 182nd Street, said he has lived in Lake Forest Park since 1964, and that the trees have grown twice the size since then. He feels they are a hazard and dangerous, although they do help the air quality and storm water runoff.

Deane Bell, 4953 NE 193rd St., said he is in favor of the tree ordinance and said that we need to protect the trees more.

Toni Potter, 19548 47th Ave NE, supports this proposed ordinance. She noted the value of the aesthetics of trees for birds, flood and erosion control and that trees absorb carbon dioxide. She said that she supported the replacement and protection of trees.

There being no further comments the public hearing on the tree removal and replacement ordinance was closed at 8:40 p.m.

Thompson requested that in light of the many people here tonight wanting to comment on the utility tax ordinance, he asked that citizen comments on this issue be taken out of order.

• CITIZEN COMMENTS
• Establishing Utility Tax

Keith Dutson, 19725 42nd Ave NE, said he is concerned about the utility tax ordinance and said he can't afford it. He said it's unfair that the city will collect this tax when it does not provide the service. He questioned the administrative costs of collecting this utility tax and how it will be audited. He asked if there had been any citizen input on this ordinance prior to tonight. He asked if the city had asked citizens how taxes could be reduced and suggested subcontracting for services and a senior citizen tax exemption. He said he is opposed to any new taxes. He said he realizes it is difficult and that all of us have to make cuts. He agreed that $1.4 million is a lot to lose but noted that the city would only be recovering $300,000 through this utility tax. He said that he did not support this utility tax.

Jim Lintz, 3028 NE 201st Pl., encouraged council to present their budget issues to the voters, and he believes that citizens in Lake Forest Park will not give up police and fire services.

Liane Newman, 16715 32nd Pl NE, talked about current services provided by the city and believes that citizens have very good services in our city. She said she would like to include language as suggested by Cmbr. Herzog, that this ordinance be rescinded if I-695 fails.

Mary Fung Koehler, 4652 NE 201st Pl., said she is against the utility tax. She feels this is a regressive tax and will hurt low-income people. She said there are other ways to get the money that the city is looking for without taxing the citizens. She expressed her concerns on how much the city has spent in legal fees and believes that money could be saved in this area.

Deane Bell, 4943 NE 193rd, said he is also concerned with this ordinance especially because it will be in effect even if I-695 fails.

Louis Van Hollebeke, 18735 53rd Ave NE, says he opposes the proposed utility tax ordinance. He said that the state has a billion-dollar surplus, and he believes that the council is over-reacting to an initiative that hasn't been passed yet.

City Administrator Jacobson said that state law requires that utilities be notified 60 days prior to the effective date of an ordinance establishing a utility tax. He noted that the city attorney has advised that the 60-day effective date for the city's utility tax ordinance should be prior to certification of the vote if I-695 is approved.

A five-minute recess was called for at 9:10 p.m.

The regular meeting was resumed at 9:20 p.m.

Hutchinson proposed that council vote on the Ordinance 799/Establishing a Utility Tax prior to the scheduled executive session.

Armanini suggested taking citizen comments on other topics prior to the executive session.

• SECOND READING CALENDAR
• Ordinance 799/Establishing Utility Tax

MacGilvra said the council has been discussing a utility tax for a long time and agrees with the urgency of having this tax in place should I-695 be approved. He said this ordinance should be adopted now. If I-695 doesn't pass, the ordinance can be amended.

Herzog moved to amend Ordinance 799/Establishing Utility Tax and to add a new Section 18 as follows:

"Section 18. In the event that Initiative 695 scheduled to be decided by the voters of the state of Washington on November 2, 1999 be certified as not being approved, Section 3 of this ordinance shall be repealed effective the date of such certification."

Armanini seconded.

In response to questions from councilmembers, Ruark suggested amending Section 18 as follows:

"...be certified as not being approved, Section 3 of this ordinance shall be repealed the effective tax rate as listed in Section 3 shall be 0% effective the date of such certification."

The maker and seconder accepted this as a friendly amendment.

In response to a