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Open Letter to the Seattle City Council

By Nigel Keiffer and Bob Hegamin   March 29, 1998


Mayor Schell’s plan to sell the Key Tower presents some very interesting but disturbing characteristics of his management style. When Seattle elected Paul Schell to be its mayor, it presented former developer Schell with a developer’s dream – the chance to redesign the entire core of a city – at the expense of the taxpayer.

Within the first three months of his administration, Schell has concentrated his efforts almost exclusively on matters of real property, such as the Library, affordable housing and the Key Tower. His main focus, though, has been on the Tower which was acquired by the City two years ago.

Destined to be the centerpiece of a new civic campus under the Rice administration, the Tower has been determined by the developer-turned-Mayor to be an inappropriate "City Hall" building for the City of Seattle. But, Seattle resident Paul Schell was strangely silent when the City was negotiating its purchase of the building. And Candidate for-Mayor Schell never publicized any plan for a "civic center" during his campaign. However, he now salivates at the prospect of selling the Key Tower for a possible $175-$200 million, which will provide him the necessary funds to put his new-found "vision" of a civic center into motion.

Schell’s Fast Track

In his headlong rush to make a perceived "killing" on the sale of the building, while spinning the all-too familiar "window of opportunity" yarn, he has apparently overlooked a few things. Schell seems to have forgotten that he is the Mayor of Seattle. Unlike his previous roles within city, county and state governments, he is now truly accountable to a constituency – the people of Seattle. He does not have unlimited power. He cannot make unilateral and personal decisions. And, he certainly cannot summarily exclude the City Council from the deliberative process.

Schell has put the sale of the Key Tower on a fast track. Two Seattle Post Intelligencer headlines tell the story.

"Schell wants to sell Key Tower purchased two years ago by City" March 13, 1998

"Schell seeks Tower bids" March 18, 1998

Within those five days, March 13 to March 18, Mayor Schell had let the developers know that his new-found "vision" had been put into motion. His "asking" price for the building is between $175-$200 million. What was the basis for his estimate? As a former director of the Department of Community Development, Paul Schell knows the limitations, regulations and City policies as they relate to the disposal of Seattle’s real property. Yet, he ignored the City’s Standard Operating Procedure on this subject when he made his announcement on the proposed sale. Schell’s proposal is being shoved down the people’s throat. The City Council, under Article IV, Section 14 of the City Charter, had better decide who actually controls the finances and property of the City.

Schell’s Friends

As he seeks bids from the real estate market, he is also looking for support from vested interests in "neighborhoods" for his plan. The City has been strangely quiet on this part of the mayor’s agenda which seems to involve only those who are on his side. Where is the media on this issue?

Speculation vs Analysis?

In his cavalier dismissal of the Key Tower as Seattle’s future City Hall, Mayor Schell has deliberately ignored the reasons for the purchase of the building in the first place.

Between 1993 and 1995, under Mayor Rice, the City crunched numbers and hired a battery of consultants to analyse alternatives for his civic campus. Although City Hall never provided the "public" a legitimate opportunity for involvement, the City did appoint a select "Citizens Advisory Panel" and solicited the downtown establishment’s "Capital Finance Review Board" to analyse the financial impacts of the proposed purchase. At the same time, the City was in the process of abandoning the City Light Building and planning to expend millions of tax dollars to move all of the utility’s staff into the Key Tower.

In 1995, a City "fact sheet" was used to justify the purchase of the building. In part, it stated:

"Several of the City’s major facilities--including the Public Safety, Municipal and City Light buildings—have reached the end of their useful lives. They are seismically and structurally unsound and very expensive to maintain…We also had a California engineering firm review the buildings for their seismic capability. The firm reported that the buildings were in serious seismic risk and that the Public Safety Building could not even be brought up to code for essential facilities" and,

"Based on cost/purchase analyses from independent real estate experts, the City believes that purchasing Key Tower is an effective, low risk way to provide needed office space for City employees over the long term…"

Confirming this in a letter from Kenneth J. Nakatsu, Director of the former Department of Administrative Services – now a division of the Department of Executive Services – to Bob Hegamin, dated October 4, 1996, the following was advanced:

"..All the financial and business experts that reviewed this transaction agreed that the City stands to save over $100 million in General Fund monies over the next thirty years. This means there will be $100 million that will be available to be used for transportation, public safety and human service requirements."

From the people’s perspective, on what is Mayor Schell basing his proposal to sell the Key Tower, other than speculation?

To the Mayor and Councilmembers, we say: Follow the rules and procedures and provide adequate time for open and informed public input.