Join Us In Saving Downtown, The Heart Of Spokane

From the publisher

Five years ago, downtown Spokane was dying.

Today, I am working and investing for its restoration. So are many others. These efforts to strengthen my hometown and my family’s business interests there have become controversial.

I would like to explain what we are doing and why.

I understand the concerns about public-private partnerships. Anyone with common sense feels uneasy when business and government sit down to negotiate. I understand, too, the perspective of another developer who might view a restored downtown as a source of business competition.

However, from my vantage point, this has been an intense negotiation between institutions of good faith and community spirit. This is about achieving a long term economic foundation for our region. This is about the role a city’s downtown plays in building a place that can provide better jobs and incomes for citizens and their children.

For a long time, downtowns have had the power to help create a region’s identity. Every economic development organization recognizes that downtowns are viewed as the face of a region by companies and people considering relocation. An attractive face brings in not only local residents, but tourists, conventions and new businesses.

Think of successful downtowns that you have visited. There, unique combinations of geography, buildings, business opportunities, entertainment and street activity attract large numbers of people, help define these famous places, help you remember them and attract you back. They are home to great old hotels, great parks and great architecture. Downtowns are centers for culture, education, entertainment, shopping, living and working. They represent the hopes and dreams of their cities and serve to stimulate creativity, pride and a sense of community.

No city seeking growth and a brighter future lets its downtown deteriorate.

In 1992, my sister, Betsy Cowles, my uncle, Jim Cowles, and I sat down to discuss the future of River Park Square. Most of the stores on Riverside had closed. J.C. Penney had moved to the mall. Frederick & Nelson, successor to The Crescent, had collapsed. Four bank branch offices stood as empty reminders that fewer and fewer major businesses here were owned and controlled locally. The organizations that 20 years earlier had helped conceive, promote and operate a world’s fair were tired and drifting. River Park Square increasingly made special arrangements to keep stores open.

Logically and economically, it appeared that the inevitable would occur - stores would close as leases came up, and most of the buildings on Main Street would be empty by 1999.

What to do with downtown’s soon-to-be empty buildings became our challenge. As a new member of Spokane Unlimited, the downtown property owners association, I volunteered to lead a committee to find out how other cities had staved off urban decay.

Two answers came back from the committee’s survey of urban experts:

First, make downtown clean, safe, convenient, beautiful and welcoming to customers, employers and prospective investors.

Second, do anything you can to save major retailing in downtown.

We got busy. In the past three years, the Downtown Action Committee formed a nonprofit downtown management organization called the Downtown Spokane Partnership. The committee and staff pounded the pavement and got more than 60 percent of downtown businesses and property owners to sign on to a plan to form a business improvement district. This voluntary, self-taxing district currently invests more than $650,000 a year in a Clean Team, Security Ambassadors, banners, marketing programs and a unified parking validation system for an 80-square-block area of downtown.

Today, the streets and gutters are clean. Thousands of pedestrians are back on the sidewalks. Despite the loss of major retail anchors and increased competition, the decline in retail sales has slowed.

Building a plan to save major retail has been a challenge of infinitely greater complexity. Betsy, with Bob Robideaux, manager of River Park Square, assembled a team of nationally respected talent to assess the feasibility of rebuilding downtown Spokane’s major retail core.

After more than a year of planning, studying and negotiating, the River Park Square team concluded that to achieve the critical mass for a successful development and the parking capacity required by national retailers and a 20-screen cinema, the full price tag on the project would be about $100 million. In addition, the team found that incentives offered by other cities to top anchor retailers like Nordstrom or the Bon Marche ran as high as the complete gift of land and buildings to the retailer.

A public-private alliance was required and warranted for two reasons. First, the public benefits were substantial in terms of the direct impact of jobs and increased tax revenues, and in terms of fulfilling the policy goal of revitalizing downtown. Second, without the lower interest rates and more-favorable collateral and payback terms provided by a federal job creation loan and grant, neither banks nor investors would find investment in the project attractive.

Finally we determined that, for the benefit of our city, River Park Square would accept less than a market rate of return on its cash investment.

Betsy, her team and the city of Spokane negotiated a deal structure similar to those used in a number of other cities across the country. This includes the $1 million grant and $22.6 million loan from the federal Department of Housing and Urban Development. It includes selling an expanded garage to an independent, nonprofit corporation which will donate the garage to the city in 20 years. It also includes tens of millions of dollars in cash, land and property contributed by our company. And tens of millions of dollars that we would need to borrow.

This proposal posed a sea-change for us as leaders of a company that for more than a century had not borrowed a dime. We had promoted conservative fiscal policy and an arms-length attitude toward government.

At the newspaper, we believed and still believe that our primary mission is to be the watchdog over government policy and spending behavior. We knew we could face damage to our credibility as a news institution over perceived conflict of interest on the River Park Square story. We subscribed to the conservative belief that government’s role should be tightly focused.

Now we were going to work with the city on a joint project? We predicted that any public-private alliance would generate a lot of heat, skepticism and downright abuse from our community.

We knew we were going to have to compromise a century of tradition and give up a degree of privacy, long cherished by our families.

It would have been so much easier to quit, and board up the buildings.

So what possessed us to pursue what we knew to be a difficult and controversial project? What possessed the City Council to negotiate with River Park Square and to agree to an emergency ordinance to guarantee its decision?

Two things: A vision of an exciting future and the conviction to realize that vision. The vision is the same one that inspired community leaders to pull together Expo ‘74 - only this time, the celebration won’t close after a year.

The vision recognizes that Spokane is the big city to more than 1.5 million people in our county and the 36 counties surrounding us. It recognizes that we’re an original downtown, a scaled-down version of a Seattle or a Chicago, with distinct and vibrant districts packed close together. We’re a well-planned downtown next to a spectacular river and falls where land uses flow from a higher education campus, at the east end, to a convention and hospitality district, to major retail and office uses in the central business district, to the historic Riverside and Carnegie Square districts, with residential uses and specialty alternative retail shops.

This vision extends beyond the direct benefits that River Park Square will generate: 2,800 new jobs in our core, $3 million more in tax receipts for the city every year and $50 million in new incomes. It includes the other projects that a people magnet like River Park Square will allow: expansion of our convention and visitor business, a more supportive environment for luxury hotels like the Davenport, the chance for market-rate housing to develop more fully downtown as people begin to want to live where they work, shop and play.

Downtown has the assets to create a big city away from the Big Cities, one that is more accessible, more livable but just as exciting. We can create a city that supplies the educational, recreational, retail and cultural amenities that a West Side engineer or a high-tech company CEO demands, but with less hassle and less cost. These engineers and CEOs probably won’t work downtown or live downtown, but without the environment that a successful downtown provides, we cannot attract them. We also can create a city that becomes a bigger convention destination.

River Park Square is the key element that begins to create this environment; it is the linchpin that uniquely supports our community’s efforts to provide good jobs for Spokane families and recruit new talent, new companies and new visitors.

The Downtown Spokane Partnership and the city have jointly launched a Downtown Spokane Plan update, to engage stakeholders from downtown and across the city in a process of further defining how we build our core city to be a more global magnet that will serve the needs of residents and businesses not only in the core but across the region. If you live in the city, I urge you to get involved in this public process early next year.

Yes, a successful downtown will provide some benefit to my company’s business - as well as all of the other businesses downtown. A successful downtown also will bring fresh cash to the city treasury, avoid the costly problems of urban decay, keep Spokane’s image attractive, help provide more exciting opportunities for our children and provide a base for healthy growth throughout our region. , DataTimes ILLUSTRATION: Sketch of planned River Park Square renovation

MEMO: W. Stacey Cowles is Publisher of The Spokesman-Review.