City to consider $18 million town center

Published on Thu, Mar 13, 2008 by ara Nelson

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City to consider $18 million town center

By Tara Nelson

Plans for an $18 million mixed-use city hall development that would include private condominiums and public office spaces are moving closer to becoming a reality.

Over the next few weeks, Blaine City Council will be seriously looking into the possibility of a public-private partnership with the Ferndale development company Teesquare Construction Management to replace its crumbling city hall.

Blaine city manager Gary Tomsic said Teesquare’s Tony Melnechuk contacted the city in September 2006 with a proposal to construct a new library, senior center and city hall, replacing the current buildings that are laced with black mold and lacking workspace. In exchange, the company would build a 49,000-square foot complex housing 22 to 40 condominium units, office spaces and public areas across four city blocks currently owned by the city.

Teesquare, which has a sister office in Colorado, has completed large projects there such as the UPS distribution center in Loveland, a wastewater treatment plant in Evergreen and a 400,000 gypsum plant in Eagle.

Tomsic said the city could benefit from such an arrangement because it would mean the senior center would get new facilities, which are greatly needed without having to ask to the citizens to approve a bond to build them. It would also help create an impetus for other growth in Blaine’s central core and affordable housing, he said.

In their regular meeting Monday, the council listened to a detailed presentation of the proposal from Melnechuk and his brother Tim.
“One of the basic underpinnings is to keep the project as cost-free and as inexpensive as possible," Melnechuk told councilmembers, denouncing the idea of a ‘golden elephant-type project.’

“We want to build a quality product, but we're not going to market these to millionaires; we want the people of Blaine to be able to live in there.”

The space that currently houses the city’s senior center would possibly be taken over by the Blaine Boys & Girls Club, he said, and the city’s skate park relocated.

Councilmember Jason Overstreet, however, said the city should proceed with caution given the current predictions for an economic downcycle. Overstreet asked the developers how likely it would be that current market conditions would change their minds mid-construction or cause delays.

Melnechuk said while he’s always been cautious about financial realities, he is optimistic the market will pick up again in the two to three years the project would take to complete. He asked councilmembers for their unofficial nod of approval before he began seeking funding.

Melnechuk said he had a small group of investors lined up and that any financing he received would be bonded and insured. “This project isn’t going to go along if there isn’t risk protection from the beginning. We don't want to fail on this.”

Blaine mayor Bonnie Onyon said she liked the concept and that she heard of a similar project in Chilliwack, B.C. that had worked “very well.” “I think the concept is an excellent one, but still it’s the public’s money and we should feel very comfortable before we go ahead with this,” she said.

Councilmember and former planning commissioner Harry Robinson agreed but added that he would like to see the timeline for securing funding for the project shortened from 18 months.

“Eighteen months is a very, very long period of time,” he said. “If it takes that long to find an investor, you’re really scrambling. “What’s going to happen, is if you do raise the money, then there will be a feasibility study and then negotiations with the bank and we’re going to be out as long as three years before we even know if this is going to fly. That’s three years we could have been doing something else.”

The council voted to postpone any decision until they could discuss the matter further in an executive session on March 17.