Olympia City Council to consider financing for two major community projects
The Olympia Finance Committee has approved a proposal from the Parks, Arts and Recreation Department to move forward with the Yelm Highway Community Park construction and Armory renovations.
The plan to finance between $18 million and $20 million will go to the City Council for a study session in May before potentially being implemented in July. Construction on soccer fields could begin soon after.
Interim Director of Parks Sylvana Niehauser said both projects are community backed, grant leveraged and shovel ready.
The proposal is to fund both projects at the same time to reduce bond issuance costs. Niehauser said projects of this size are legacy projects and they require this type of funding measure.
She said the design for both projects is beyond 60% complete at this time, and it’s anticipated the design for the Yelm Highway park will be at 90% by the fall. She said the project will be put out to bid later this year.
The armory is ready to be upgraded as soon as funding is secured.
“Our anchor partners have been selected. We’ve had broad community support,” Niehauser said. “We’re leveraging external funding in the grants and the donations, and then by combining these two projects together, we’re leveraging the most optimal conditions for financing so that we’re not getting separate fees for both projects.”
Niehauser said more than $15 million has been invested to date in the two projects. The plan would leverage $6.3 million in external grants the city has already secured for the projects. She said those funds would be at risk if the projects are delayed much longer and funding isn’t secured.
“It would potentially impact the trust of the community, since we’ve been planning these projects for a really long time, and then we do have some concern about our credibility with the granting agencies, just in that having to turn back the funds for not having the projects come to fruition,” she said. “We’ve got investments.”
Yelm Highway Community Park
Niehauser said the cost for Phase 1 of the Yelm Highway Community Park is $25.3 million, and $14 million has been invested so far. She said the city has secured $3.85 million in grants for this project.
She said the city also has $5.9 million cash in hand for the project.
She said the proposed debt financing for this project is $13.2 million. They’re proposing using $2 million of the voted utility tax fund balance and impact fee revenues.
Olympia Armory Creative Campus
Niehauser said the armory’s energy audit is just about complete, and the eight anchor nonprofit partners have been selected to move into the building once it’s up to code.
She said there have been some interim facility rentals that have generated some extra excitement about the building being open to the public, but that’s still a ways off. The building needs a number of infrastructure upgrades around accessibility and ADA compliance.
Niehauser said the city also received a $1.5 million grant for solar panels that will go on the roof. Some roof upgrades and reinforcements will need to be built first.
She said Parks is proposing a $5.5 million debt financing for the armory, as well as using $3 million of the non-voted utility tax fund. She said the city has secured $2.5 million in grants, and the plan is to use Olympia Metropolitan Park District funds totaling $250,000 plus $900,000 cash in hand.
“So together for these two projects, we’re looking at a debt financing that’s between $18 million and $20 million,” Niehauser said. “And I say that because the rates do impact and as we get closer to construction, we’ve seen a little bump in the cost of materials and such. So the longer we delay this, the more the cost of construction goes up.”
Annual payments of $1.3 million to $1.5 million would be paid on the bond starting in 2027 using revenue from the voted utility tax and OMPD funds.
Future development
Niehauser said the idea is to construct one soccer field at a time at the Yelm Highway site. She said the state has upped its grant limits on youth athletic facilities to $1.5 million, which helps the city get to the nearly $2.5 million mark to build a new field.
She said the city would collect impact fees and then SEPA mitigation fees, then every other year staff can apply for a grant to match local funds for another soccer field.
Niehauser said if the city moves forward with annexing neighborhoods in the southeast urban growth area, more folks would be paying into the OMPD, and there would be more funds to move these projects forward.
However, City Manager Jay Burney said the topic of annexation isn’t going to be brought to the council until next year.
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