River Park Argued In High Court Lawsuit Questions City’s Role In Downtown Development

Washington state’s highest court heard a case on Wednesday that could decide the future of downtown Spokane.

A lawsuit filed against the city of Spokane calls into question what constitutes a public emergency, what legislative actions serve public purposes and when courts should consider overturning actions of local governments.

The case involves the $100 million redevelopment of downtown’s River Park Square, which is to include a new Nordstrom store, a multiplex cinema and numerous other shops and restaurants.

Attorneys for the city and the developer argued before the Supreme Court that the project is a catalyst to save downtown from further decline. Attorneys for an opposition group called the project corporate welfare.

At issue is the city of Spokane’s involvement. The city has agreed to: vacate part of Post Street, assist developers in securing a $23.8 million federal Housing and Urban Development loan, pledge parking meter money as a backup funding source for the project and rent the development’s parking garage and the land it sits on.

The city passed an emergency ordinance in January supporting the project. Emergency ordinances prevent opponents from forcing a public vote by referendum.

Steve Eugster, attorney for the plaintiffs, argued that the city action exceeded its authority. It is not serving the public by participating in a private development, he said.

Spokane’s city charter only allows the city to pass emergency ordinances when necessary for public peace, health or safety and this ordinance meets none of those requirements, Eugster said. “It is primarily for the purpose of River Park Square, a private shopping mall,” he said.

Justice Philip Talmadge asked Eugster if he denied that a public parking garage served a public purpose.

“I think this court has to put some definition on what a public purpose is,” Eugster replied.

Additionally, Eugster said, the city never created a comprehensive parking facilities plan and has not complied with the state Environmental Policy Act.

Duane Swinton, attorney for the owners of River Park Square, said the city is serving the public because it is supporting a project that will help save downtown from further decline.

The city’s involvement is limited, he added.

“Every time Mr. Eugster says the city is purchasing this garage, that is a flat misstatement of fact,” Swinton said. “There’s not one penny of city money that is going to go toward acquisition of this garage.”

The garage will be purchased with $26 million in revenue bonds floated by a nonprofit corporation formed by River Park Square’s owners. The garage and the land it sits on then will be leased to a public development authority created by the city. When the bonds are retired, using parking garage revenues, the city will own the garage.

River Park Square is owned by Citizens Realty Co. and Lincoln Investment Co., affiliates of Cowles Publishing Co., which owns The Spokesman-Review.

The city has been studying this issue since June 1995, Swinton said. There have been two appraisals, an economic feasibility study and an economic impact report. Numerous hours of public testimony have been heard by the council, he said.

Justice Richard Guy questioned Swinton about how deeply involved a city should become in a private development.

Supporting a public parking garage more than satisfies a public purpose, Swinton replied.

Attorneys for the city and developer also argued that a December state Supreme Court decision gives legislative bodies broad discretion to determine what is a public emergency. That case, filed against the state, contested legislative action taken to approve financing for the Seattle Mariners’ new baseball stadium. Eugster also was a plaintiff in that suit.

Typically, the court takes six to nine months to rule, but attorneys for the city and developer have said they expect a quicker decision.

If the court finds in favor of the city, Eugster said the lawsuit will come to an end. “That’ll be it for this case,” he said.

Despite tough questioning from Justices Guy and Richard Sanders, attorney Tom Kingen for the public development authority said he thinks the majority of the court believes that if a legislative body has considered all of the issues in making its decisions, that its decision should stand.

“The majority says the legislative body has the right to make decisions,” Kingen said.

, DataTimes