Stuckart accuses clean air agency regulatory overreach, cites Otis Hotel asbestos fines and construction delays

The local clean air agency “overreaches” with its regulatory authority and hampers economic development in an effort to “justify their existence,” Spokane City Council President Ben Stuckart said.

Stuckart said the Spokane Regional Clean Air Agency had allowed at least two local developers to begin work on projects renovating historic buildings, only to come back and fine them for inappropriately dealing with cancer-causing asbestos, which is commonly found in older buildings.

“I don’t agree with a lot of things the clean air agency does,” he said. “They do these things to justify their existence, and they give all government agencies a bad name when they act like this.”

Lisa Woodard, the agency’s spokeswoman, dismissed Stuckart’s accusations.

“Our role is protecting public health,” she said. “The goal is to deter violators.”

She noted Stuckart was appointed to the agency’s five-member board in January 2018 and attended only four of its monthly meetings. Beginning next month, Councilwoman Kate Burke will represent the city on the board.

Stuckart, who is running for mayor this year, broadened his criticism of the agency, and denounced its action to enforce state regulations on “nuisance smells” around recreational cannabis farms. He joined the agency’s board of directors last year to fight the regulations, which he said would “completely regulate and tax an industry to death.”

The air agency, founded in 1969, represents the county and its 12 incorporated cities and towns and enforces local, state and federal air quality laws and regulations, which is allowed by the 1967 Clean Air Act of Washington. Its annual budget is $2.3 million and comes from state and federal grants and local fees.

Stuckart said the agency’s actions have been detrimental to local economic development and pointed to two projects: the renovation of the Otis Hotel in downtown Spokane, and the renovation of an old grocery store in the South Perry District.

In December, Stuckart wrote a letter to the agency’s director, Julie Oliver, on official City Council letterhead criticizing her agency’s dealings with Curtis Rystadt, the developer of the Otis, and demanded that the agency “explain in detail” the citations and fines leveled against Rystadt.

Rystadt, a former mortgage broker who purchased the building for $1.4 million in June 2017, is turning the 108-year-old building into a 122-room hotel with a restaurant on the ground floor.

In March 2018, work was stopped at the building after air quality inspectors said they found asbestos on the site but said Rystadt hadn’t hired a “certified asbestos abatement contractor.” State regulators issued an “order of immediate restraint,” and work stopped on the project for three months while investigators looked into the handling and disposal of any asbestos-laden materials on site.

In November, the Washington state Department of Labor and Industries issued $140,000 in citations to three companies working on the project for violating state health and safety rules, one of which is owned by Rystadt. The following month, the clean air agency issued its own violations, and said 105 dumpsters were removed from the Otis before its inspectors arrived. At that point, debris in the building tested positive for asbestos. Similar debris was found in two dumpsters outside the building.

Lori Rodriguez, compliance section manager with the clean air agency, said in December that monetary fines would come mid-January.

Three months later, those fines have yet to be issued. Rodriguez now says that one of the companies getting fined couldn’t be located, delaying the process. She now wants the fines to be issued before the end of March.

Rystadt denied that he did anything wrong, as he has since the beginning.

“Not one fiber. Not one fiber anywhere but on the fifth floor on the north side, where we hadn’t done any demo, by the elevator, where we hadn’t done any demo,” Rystadt said, suggesting that any asbestos found by inspectors wasn’t overturned by his workers. “This claim that there was airborne asbestos is categorically, 100 percent false, documented by over 200 tests.”

Rystadt said his project has been set back seven months because of his troubles with the regulatory agency, and he estimated he’s lost “without a doubt, well over a million dollars. A couple million dollars probably.”

In his letter, Stuckart called Rystadt’s project one of “citywide significance” that is “removing blight and returning an inactive property to the downtown tax base.”

Criticizing the air agency for delaying the project for months, Stuckart noted that Rystadt “lost contractors and investors because of the delays” and had unsuccessfully requested information about the delays or forthcoming fines.

“I hope the length of delay caused by lack of communication will be reflected in the fines issued on this property and to the property owner,” he wrote.

Woodard said the fines will not be decreased as Stuckart has requested.

The project along West 11th Avenue in the South Perry district had a similar problem, Stuckart said, suggesting the agency allows work to begin on projects so it can come in and fine the developers. In his telling, developers hire an asbestos expert to check a building, the expert signs off on the cleanup, allowing the city to issue building permits and work to begin. Only then, Stuckart said, does the clean air agency show up, stop work and issue fines.

“There is a complete disconnect between the clean air agency and the city,” he said, placing blame on the air agency. “They’re not coordinating with other agencies. You’ve got to be coordinating with the government agency that’s permitting.”

Woodard said city permits have a notice on them to contact the clean air agency if asbestos is suspected in a building project. She added that in the case of the Perry project, a qualified contractor surveyed the building’s exterior and roof but failed to look at its interior. The building was gutted without the required permit.

Requests for comment to building owner Rob Brewster, who runs Seattle-based InterUrban Development, were not returned.

Stuckart said he wasn’t concerned that it may appear like he’s trying to influence a clean air regulator’s actions.

“They’re overreaching,” he said.

Rystadt said he was glad Stuckart was taking the agency on but noted that workers are currently putting up drywall in the Otis, and he was anticipating a September completion date for the project.

“They absolutely without a doubt overstepped their bounds. I lost financing and loans because of this story,” he said. “It’s comical. If it wasn’t for the fact that these agencies deter and slow down progress, it would be comical. But the fact that they have the power to stop you like that, it’s just sad.”