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City Council - Community and Economic Development Committee

City Council - Community and Economic Development Committee

Mon, February 9, 2026

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Meeting summaryAI-generated

City Council Community and Economic Development Committee — February 9, 2026


This was a regular committee meeting chaired by Council Member Jace Cotton (At-Large), with Council Members Hollie Huthman (Ward 2) and Skip Williams (Ward 4) also serving on the committee. Additional council members Lisa Anderson and Michael Lilliquist participated with questions. Two substantive items were discussed: a property surplus declaration process and lodging tax grant recommendations.



Surplus Declaration Process for 1504 and 1506 I Street


Community and Economic Development Manager Tara Sundine introduced this item, which came as something of a surprise to city staff. The property is a duplex (two two-bedroom, one-bath units) on a 5,000-square-foot parcel in the Lettered Streets neighborhood, currently valued at approximately $710,000. In 1990, the city conveyed the property to the Opportunity Council to operate as transitional housing. The original agreement included a reversionary clause — meaning the city could reclaim the property if it was no longer used for its intended purpose — or the Opportunity Council could repay the original $145,000 loan plus interest, which today totals over $600,000.


The Opportunity Council recently contacted the city to say it can no longer maintain the property. Rather than requiring repayment and allowing the home to enter the private market, staff recommended exercising the reversionary right and keeping the asset in community service. Staff reached out to the local nonprofit community and found at least four organizations interested in acquiring the property.


The proposed process is somewhat unusual: the city would declare the property surplus, designate it for special (below-market) disposition for the benefit of low- or extremely-low-income households, and then issue a Request for Proposals. The actual transaction would happen same-day at a title company — the city would receive the property from the Opportunity Council and immediately transfer it to a new nonprofit selected through the RFP. This approach minimizes the time the city holds the asset (avoiding utility costs, maintenance liability, and administrative burden) and keeps the property in service as quickly as possible.


Council Member Anderson asked whether the property would remain transitional housing or could support low-income homeownership. Sundine confirmed the RFP will be open to both models, though sale price would reflect the use — a homeownership model might return some funds to the city, while a transitional or higher-needs-population use might result in a near-zero-dollar sale. Early interest from nonprofits appears to lean toward serving higher-needs populations rather than homeownership. Anderson also clarified that the property has likely been tax-exempt throughout the Opportunity Council's tenure.


Council Member Cotton asked whether the city has other similar reversionary interests in properties. Sundine acknowledged this was a surprise discovery and said she could not confirm or deny other similar arrangements without further research — this predates the city's housing levy and stems from older CDBG-era activity.


This agenda item was for discussion only; a formal public hearing and potential council action are scheduled for the full council meeting the same evening.



Lodging Tax Advisory Committee (LTAC) Grant Recommendations — Bellingham Fan Zone and Downtown Activations and Beautification Program


Tara Sundine also presented LTAC's grant recommendations for two programs funded by lodging tax revenues (the tax collected from hotel guests staying in Bellingham).


Bellingham Fan Zone: Bellingham was selected as one of nine Washington State fan zone communities tied to the 2026 FIFA World Cup, with six matches being played in Seattle this summer. The city originally planned to host six large watch parties directly, but quickly realized the cost and logistical demands were beyond available resources. Staff pivoted to a community-led grant model with four tracks:


Track 1 – Community Watch Parties: Two free, open-to-the-public events. One is a block party on the Commercial Street block near the parking garage; the other is at Kulshan Trackside. Each eligible for up to $25,000.
Track 2 – Designated Fan Zone Venues: Grants to local businesses and a couple of nonprofits with kitchens, seating, and capacity to screen matches throughout the tournament.
Track 3 – Business Readiness Grants: Overseen separately by the Downtown Bellingham Partnership using a $50,000 grant from the Seattle Foundation; not part of this council action.
Track 4 – Soccer-Related Activations: Grants for community events and activations building excitement around the tournament, not necessarily tied to match screenings.

Sundine noted that final grant amounts are subject to contracting review, as some recipients have never contracted with the city and some ineligible items were identified; bulk purchasing may also reduce costs.


Downtown Activations and Beautification Program (3rd Round): Five recipients recommended:

Bellingham Blooms – Floral installations throughout downtown for a full year
Procession of the Species – Small grant supporting the existing community parade
Bay Street Outdoor Cinema – Three outdoor movie nights in the arts district
Activating Sunset Alley – Addition of Edison lights to make the alley more welcoming after dark
Hello Lampost – An interactive visitor experience operated by Downtown Bellingham Partnership

Council Member Lilliquist asked whether the funded events would be financially accessible to the public. Sundine confirmed that none of the watch party venues are charging admission — all are free to attend — noting this is actually an advantage over the city's original plan, which would have required contemplating ticket sales to cover costs.


Council Member Williams moved to approve the grants as recommended by LTAC. The motion carried on a voice vote with no dissents or abstentions recorded. Cotton indicated she would bring the recommendation forward to the full council that evening.


Vote: Motion by Williams; no seconder explicitly named in transcript; approved unanimously by voice vote (Aye: Cotton, Huthman, Williams; no nays or abstentions).



Key Takeaways


1504/1506 I Street duplex: The city plans to reclaim a transitional housing property it conveyed to the Opportunity Council in 1990 and immediately transfer it via RFP to a new nonprofit — keeping a $710,000 community housing asset out of the private market. A public hearing and council action were scheduled for the same evening.
All Fan Zone watch parties are free and open to the public, a notable community benefit of the pivot from city-hosted to community-led events.
LTAC lodging tax grants approved for the Bellingham Fan Zone program and five Downtown Activations and Beautification recipients, with final amounts to be confirmed through contracting.
World Cup excitement is coming to Bellingham: As one of nine designated Washington fan zone communities, the city is positioning itself to benefit from tourism and community energy surrounding the six Seattle-hosted matches this summer.
Staff flagged uncertainty about whether other city properties may have similar reversionary interests from the pre-levy CDBG era — worth watching for future follow-up.

AI-generated summary from voice-to-text transcript. Not the official record. Verify important details with the source documents linked above.

What happened at this meeting

Discussion regarding the surplus declaration process for 1504 I Street and 1506 I

# Summary

Tara Sundine, Community and Economic Development Manager, presented a surplus declaration for 1504 and 1506 I Street, a 5,000 square foot duplex that Opportunity Council has operated as transitional housing since 1990. Rather than requiring Opportunity Council to repay the original $145,000 loan (now exceeding $600,000 with interest), staff recommended declaring the property surplus and using a back-to-back transaction process where the city briefly takes ownership before immediately selling it to a selected nonprofit through an RFP. Staff identified at least four interested nonprofit entities and noted that the property's flexibility from federal funding constraints makes it valuable for serving low and extremely low income households. Council Member Anderson sought clarification on whether Opportunity Council had been paying taxes and insurance, and whether the property would continue as transitional housing or convert to low-income home ownership; staff explained that the RFP process would explore all options while potentially generating compensation for the city if used for home ownership.

Consideration of Lodging Tax Advisory Committee grant recommendations for the Bellingham Fan Zone and Downtown Activations and Beautification Program

# Summary

Staff presented the Lodging Tax Advisory Committee's grant recommendations for the Bellingham Fan Zone and downtown activation programs, which the City Council must approve without modification. The initiatives include four tracks: community watch parties ($25,000 each), designated Bellingham Fanzone venues at local businesses, business readiness grants, and soccer-related activations, all funded by lodging taxes from hotel visitors. Council Member Huffman requested clarification on funding sources, while Council Member Loquist raised concerns about public accessibility, which staff addressed by confirming that watch parties are free events with no venue admission charges. Council Member Williams moved to approve the recommendations, and the motion passed without objection.

Agenda items (2)

Procedural (2)
24822ProceduralDiscussion regarding the surplus declaration process for 1504 I Street and 1506 I
The city is discussing how to declare two properties at 1504 and 1506 I Street as surplus (no longer needed for city use), which is a required step before they can be sold or transferred.

What happened

# Summary

Tara Sundine, Community and Economic Development Manager, presented a surplus declaration for 1504 and 1506 I Street, a 5,000 square foot duplex that Opportunity Council has operated as transitional housing since 1990. Rather than requiring Opportunity Council to repay the original $145,000 loan (now exceeding $600,000 with interest), staff recommended declaring the property surplus and using a back-to-back transaction process where the city briefly takes ownership before immediately selling it to a selected nonprofit through an RFP. Staff identified at least four interested nonprofit entities and noted that the property's flexibility from federal funding constraints makes it valuable for serving low and extremely low income households. Council Member Anderson sought clarification on whether Opportunity Council had been paying taxes and insurance, and whether the property would continue as transitional housing or convert to low-income home ownership; staff explained that the RFP process would explore all options while potentially generating compensation for the city if used for home ownership.
24823ProceduralConsideration of Lodging Tax Advisory Committee grant recommendations for the Bellingham Fan Zone and Downtown Activations and Beautification Program
City council will review and decide whether to approve grant recommendations from the Lodging Tax Advisory Committee for funding the Bellingham Fan Zone and programs that beautify and activate downtown.

What happened

# Summary

Staff presented the Lodging Tax Advisory Committee's grant recommendations for the Bellingham Fan Zone and downtown activation programs, which the City Council must approve without modification. The initiatives include four tracks: community watch parties ($25,000 each), designated Bellingham Fanzone venues at local businesses, business readiness grants, and soccer-related activations, all funded by lodging taxes from hotel visitors. Council Member Huffman requested clarification on funding sources, while Council Member Loquist raised concerns about public accessibility, which staff addressed by confirming that watch parties are free events with no venue admission charges. Council Member Williams moved to approve the recommendations, and the motion passed without objection.

Additional votes recorded in minutes

Approve LTAC grant recommendations for Bellingham Fan Zone and Downtown Activations and Beautification Program

aye 3
Edwin H. "Skip" Williamsaye
Hollie Huthmanaye
Jace Cottonaye

Verbatim transcript available

74 transcript segments indexed

Good afternoon everyone. Um this is the February 9th um committee meeting of the community economic development committee. Uh I'm joined on this committee by council members Huffman and Williams. Um our first item today um is a discussion regarding the surplus declaration process for 1504 and 1506 I Street.
City of Bellingham Community and Economic Development Committee minutes February 9, 2026, 1:35 p.m. Chair: Jace Cotton Phone: 360-778-8200 Members: Hollie Huthman, Edwin H. "Skip" Williams Email: ccmail@cob.org Web: cob.org/council City Council committee meetings Standing committee members receive reports and information, ask questions, and vote on a recommended action for consideration by the full Council at the regular meeting.
Um, and I'll skip reading the agenda summary because I think the it probably is helpful to start with the background um for um what this is hoping to accomplish. So, I'll first recognize Tara Sundine, community and economic development manager.
There is no public comment period during committee sessions. Call to order and roll call Council President Stone called the meeting to order at 1:35p.m. Present: Committee Chair Jace Cotton, At-Large Committee Member Hollie Huthman, Second Ward Committee Member Edwin H.
>> Thank you, Council Member Cotton. Good afternoon. Uh, this is a property that is going to be new to you because it was certainly new to your your staff. Um, it was something that we developed our work program in November and didn't know that this was going to be on the work program.
"Skip" Williams, Fourth Ward Community and Economic Development 24822 1. Discussion regarding the surplus declaration process for 1504 I Street and 1506 I Street Summary: Tara Sundin, Community and Economic Development Manager, presented the surplus declaration process for 1504 I Street and 1506 I Street.
In 1990, the City conveyed the properties to the Opportunity Council, who no longer intends to operate the property as a transitional housing facility. A public hearing will be held at tonight's regular meeting to allow for public input.
So, I'll I'll provide a little bit of a description as to why that that's the case. But first, uh, just to let you know where the property sits within our city. It's in the Lettered Streets neighborhood between Dupont Street and Holly would be slightly off screen at the bottom of the screen there.
It's located in the 1500 block of I between Clinton and Bankraftoft. It's a 5,000 square foot parcel. It was likely once a single family home that was later converted to a duplex. There's two two-bedroom, one bath units.
Council Members discussed the surplus declaration and asked questions. 24823 2. Consideration of Lodging Tax Advisory Committee grant recommendations for the Bellingham Fan Zone and Downtown Activations and Beautification Program Summary: Tara Sundin, Community and Economic Development Manager, presented grants for Council's consideration as recommended by the Lodging Tax Advisory Committee (LTAC) Page 1 of 2 for the Bellingham Fan Zone and Downtown Activations and Beautification Program.
Its value is around $710,000. There's a small parking facility in front. Um, and this this this is the view looking from I Street. So, my staff was a little surprised when they got a call from the opportunity council saying, "Hey, um, we're no longer able to to look after and care for this home anymore.
Council Members discussed the LTAC recommendations and asked questions. Action: Edwin H. "Skip" Williams moved to recommend approval of the Lodging Tax Advisory Committee (LTAC) grant recommendations for the Bellingham Fan Zone and Downtown Activations and Beautification Program.
We need to talk to you about next steps." Um, so it was then that we learned that back in 1990, the city conveyed this asset to the opportunity council for transitional housing and it has been serving our community ever since that time in that way.
The structure of it um we had kind of two terms. One was to um there was a reversionary clause which just means that the city has the right to take this asset back in the future if it was no longer being used in the way that it it was intended as transitional housing or that the opportunity council would need to pay the full loan amount back.
And that loan was structured at $145,000 back in 1990 plus uh interest. And so today that would be over $600,000. And so we looked at both of those those options. staff staff looked at that and said, you know, rather than the OC having to pay us back and then putting the house on the private market, we knew that our community still needed to have an asset like this.
And so we explored this uh this first option uh which was to the reversionary right. So that's what we're we're going to be recommending. Uh let's see. Oh, the other step that we did in in order to really kind of solidify that decision was we reached out to our nonprofit community, those that we we have worked with or those that we don't necessarily work with but know that exist just to get a feel for whether or not there was interest in the home.
We've seen um some of our agencies go away from these smaller scattered site properties. Um and it does turn out that we had at least we know of at least four entities that are interested in the asset.
Um and and so we just wanted to get a feel for that before um taking this step with with the council. So then we we sat down with Amy Cra and we worked uh took a look at uh the process by which we need to kind make a recommendation to you on surplusing the property.
I know it seems odd. Usually we're coming to you surplusing a site that we already own. Um so it seems a little strange, but we know that we can own this property. We have the right to own this property.
Um so we're tonight um you'll be holding a public hearing at which time after that hearing we'll be asking you to declare the site surplus to the city's needs. This means that the city doesn't have a use for it internally that you designate the property for a special disposition process.
That means that we're looking at a below market rate uh sale that that we've determined that this could go have a a public benefit and serve low or extremely low income households in our community. So that that that step's required.
And then finally that you direct staff to sell the property by negotiation through an RFP or request for proposals process. So, if the council acts in that way this evening, then the next steps would be that we'd issue the request for proposals.
Um, Katie Sullivan in our office will be overseeing that process with support from Samuel, myself, Amy Creme, and potentially others that we would then select and negotiate with the recipient. We'll be leaning on um our our our RFP process that values the quality and the soundness of the operator as well as meeting goals um and objectives.
And in the in this case, we'd be leaning towards our consolidated plan and making sure that we are meeting the needs that are outlined in that plan. And then we would execute two transactions backto back.
And in this case, what we're anticipating is same day. And that means that we would receive the property. This would be happening at the title company and we'd we'd have all the documentation lined up, but we'd re be receiving the property moments before we sold the property.
So, we'd receive from the OC and then we would sell the property to a new nonprofit selected through the RFP process. The reason why we're recommending this process as fast as we we can possibly go to get this property returned to serving the needs of the community.
Also, the opportunity council knows this property really well. They've been looking after it for 36 years. rather than the city taking ownership of an asset that either my team or the facilities staff or somebody at the city would have to change, you know, start paying utilities and bills and what if something happened to the property while we owned it minimizes um and is just a more efficient um process.
small transaction fee savings would occur at the title company because we're doing same day transaction and we'd also be saving my team and other uh staff people the time of of doing multiple transactions.
So that's why this does look a little bit unique. So you'd be this evening hopefully designating this property surplus uh in anticipation that we will be owning this site for moments um in the coming weeks.
It's for that reason that we decided to come to you this afternoon. Um so that um rather than like discussion and uh dialogue, it would be an opportunity for you to ask us questions. With that, I'll turn it back to you, Council Member Cotton.
>> Questions from committee >> or other council members? >> Council member Anderson. >> Thank you. Um, so since this was kind of a surprise, I assume opportunity council was paying taxes and insurance or anything other type of bills for that ownership.
Um, is that kind of the expectation going forward? I mean, when you're looking at uh potential interest, it looks in here that the hope is to keep it um still as a transitional housing service versus maybe a home ownership for low income.
So, is that the direction you're hoping to keep it in? >> We are um we're going to issue the RFP to leave all of those options open. So transitional housing or permanent housing could be ownership or rental.
We don't want to limit the RFP, but the structure or the the price in which we would sell that, you know, a zero, you know, or cash would probably depend on what they were doing with the property. So if it went to home ownership, we would expect some money to return to the city.
Does that answer your question? And as far as taxes go, most likely this property hasn't been paying taxes because >> Thank you for that clarification because I wasn't clear whether or not we're looking for just transitional housing partners or if it could go into low-income home ownership.
Thank you. >> One of the benefits if it stays in transitional or some of those the city won't have some of the constraints that come with federal money. So we can be more flexible with this asset. We don't have to.
Sometimes our nonprofits are working with like somebody can't live there for any more than x number of months or x number of years. So it does leave us some flexibility there. The interest that we've seen so far is not in the home ownership but would be more higher needs population.
>> Wonderful. Thank you. >> Other questions? Um, this is a very unique situation and I'm curious if we have any sense, do we have reversionary interests in any other like is this a one-off or um, >> you know, I this was this was a bit of a surprise.
We don't quite know how we came into ownership of it, but it looks like we owned it the year prior, but we don't know. Oh, I just was trying to speculate. I would be speculating which I shouldn't do right now.
Um I don't know. This was predates our levy. This was when we were working just with CDBG or community development block grant. >> Well, thank you so much. Um this item was for information only, but as was noted public hearing this evening where we may take action.
Um so thank you so much. Um we'll go ahead and move on to our next agenda item. All right. Um, our next agenda item is I just had it and I lost it. um consideration of lodging tax advisory committee grant recommendations for the Bellingham fan zone and downtown activations and beautifification program.
Um on January 27th, the lodging tax advisory committee met to review and make recommendations for city council consideration. Um the action that's requested today is um to vote to approve, but um before we get to that, uh I will turn it over to Tara Sundine again, um community and economic development manager.
>> Good afternoon. Thank you, Council Member Cotton. Uh included in your packet is a multi-page memo that outlines the lodging tax advisory committee's recommendations. In December, I came to you and provided the 2026 budget recommendations and mentioned that I'd be coming soon with the details on the Bellingham fan zone as well as the downtown activation grants.
It's the responsibility of the Bellingham City Council to make sure that you concur with um the recommendations from the lodging tax advisory committee. as a re or as a reminder. You can't change dollar amounts or add new things.
Um but you can this is your opportunity say you know this is not a something that's appropriate. So that's the you are the back stop. Uh I wanted to provide just a little bit of background on Bellingham fan zone.
So uh I don't believe I've come and spoken much about this to the city council. Um, Bellingham was selected as as a fan zone as as you hopefully are aware. Uh, the World Cup um is coming to Mexico, the United States, and Canada this summer.
And, uh, six of those matches are going to be played in Seattle. And there's quite a buzz about Seattle this week. Um, and Seattle, which is unique, they they decided they wanted to spread the excitement and energy throughout the state.
And they selected seven or sorry, nine different communities to be fan zones. And we were one of those. And we're very, very excited. And we set off to host six large watch parties. And we realized within a a couple of months of of that planning effort that hosting six watch parties was a little bit beyond the resources that we had available.
And so we decided to pivot. And that pivot is included in your packet, which was instead of visit Bellingham, the city, the port of Bellingham, and the part downtown Bellingham partnership hosting large special events.
Let's turn to our community and ask them to help us um celebrate uh the games and actually probably be able to show a lot more uh games than the six that are being shown in Seattle. So, we crafted an RFP and um we created four different categories.
uh community watch party. Uh that was that those are to highlight those games that are being played in Seattle. Maybe not all of them. We really realized how expensive it is to throw special events through this process.
We offered $25,000 per watch party under that track. Track two is designated Bellingham Fanzone venues. And you're seeing in our list of recommendations here that we're recommending that we work with a number of venues.
These are are businesses predominantly a couple of nonprofits but mostly businesses in our community that have um kitchens that have staff that have seating that have venues um and that can can host and show the those these games throughout the the um tournament.
The third track is business readiness grants and you're not seeing th that list in this packet because that program is being overseen by downtown Bellingham Partnership. Seattle Foundation provided them with a $50,000 grant for them to help our community become ready uh for the games.
And so they are uh running their own process and making those announcements on their own. And then the final track is soccer related activities or activations. Um, which is really just to build some some more community excitement about the matches.
You don't have to they're not necessarily showing the matches, but throwing um some act activations. So in your packet is around Oh, I'm not quite sure. I'm sorry I didn't add them up, but there's a lot of grant uh recipients that we're proposing and the final grant amounts will be solidified through a contracting process.
There are a number of entities that have never contracted with the city. So, we noticed a few ineligible items and we also noticed that we could we could probably save some funding if we did some bulk purchasing rather than each entity um purchasing on their own.
So those are subject to kind of final grant amounts with the city. So that's the first slate um which is the Bellingham fan zone. And then the next set of of recipients is under the downtown activation and beautifification grant program.
This is our third round. Um uh and we're re recommending five recipients. Bellingham Blooms, which is a um really fun activation that's going to bring flowers and lots of different installations throughout the downtown area for the whole for a whole year.
Procession of the species hopefully is a a small parade that you're familiar with. A small grant is being awarded to them. Bay Street outdoor cinema, three outdoor movie nights uh being hosted on Bay Street in the arts district.
Activating Sunset Alley. Sunset Alley has been an activation that we have supported previously, but this would be adding Edison Lights in the alley to make it feel more welcoming in the evening or after dark hours.
And then finally, Hello Lampost, which is a interactive visitor experience that the downtown Bellingham Partnership has been operating for a short time. So with that, we're recommending a whole whole bunch of granting activities this year.
Um the lodging tax advisory committee uh recommends full support. >> Questions from committee. Council member Huffman. Thank you, Tara, for the presentation. Um, could you give us a little bit more specifics of where the funding for these these grants is coming from?
>> Yes, I can. Um, it's a really important point. Um, the lodging tax advisory committee oversees the lodging taxes which are collected by hotel years. So visitors that are staying in Bellingham pay an additional tax on their hotel bill that's collected and then remitted to the the city of Bellingham to stimulate additional investments.
So they're um that's the the source of these funds. >> You questions or comments? Council member Williams. I don't have a lot of uh questions. Um but this looks like a very wellthoughtout list of activities and things that will do nothing except boost our presence.
And so I will move approval of these. >> Great. We have a motion to approve grants as recommended by the lodging tax advisory committee. Um, further discussion. Um, Council Member Williams, I mean, Loquist, sorry.
>> Thanks. I'm on this committee. I hope the committee does vote for approval and endorses Elach recommendations. My question is sort of how does this additional funding work? Many of these venues probably will be maybe charging admission or not charging admission.
Certainly, they'll be charging for beverages or concessions. Um, is there some sense in which these grants keep admission low or zero or does it, you know what I'm saying? I mean, there should be a community benefit, not just the event, but is there some sense in which maybe it's more financially accessible also for the public to attend these events?
>> Yeah, the the watch parties are free. So, there's two watch party locations. One is a block party on C commercial um the same block as the Commercial Street parking garage. That will be a free and open event to the community.
And then the other watch party location is at Culion Trackside and that's also free. I actually I don't think there's a single venue that's charging an admission, which is an advantage of going this direction.
We were looking at um having to contemplate charging admissions for us to host events. Thank you for that question. >> Seeing no further questions or comments, um uh all in favor of the motion to approve grants as recommended by Eltac, uh please say I.
I >> um and no I nazs or abstensions I'll bring forward that recommendation this evening. Um that is my last agenda item I'm pretty sure. Um so with that we'll um pass it back to uh council member or council president.