Politics from the Palouse to Puget Sound

Friday, September 22, 2006

"Building boom; Pullman issues construction permits at a record pace"

This story appeared in today's Moscow-Pullman Daily News:
The city of Pullman may be on its way to another record-breaking year for construction.

The city issued building permits for a total of about $54 million in new construction and remodels by the end of August, according to statistics compiled by the Public Works Department.

That’s more than $11 million ahead of the total building permits issued by the end of August 2005, but still about $10 million short of the record $64 million in total new construction for 2005.

With three months left in the year, city officials are optimistic another record could be broken.

“We could be pretty close,” said Public Works Director Mark Workman. “Certainly $60 million isn’t outside the realm of possibility.”

The norm for the five years before last year’s record was about $30 million in new construction, said Finance Director Troy Woo.

“If we break the record, we’ll be about double the norm,” Woo said.

It’s too early to say how that might impact the city’s 2007 budget, but Woo does expect to see a wave of sales taxes come in over the next three years from big-ticket items like the Compton Union Building remodel and Palouse Ridge Golf Course at Washington State University.

Woo anticipates seeing an estimated $731,000 in sales taxes from the CUB remodel between 2006 and 2008. The golf course should net the city about $70,000 in sales taxes over the same period.

The city saw significant growth in multifamily residential and commercial development at the end of August 2006, compared to the end of August 2005. About $18.7 million in building permits were issued through August 2006. That’s about $500,000 more than the same period in 2005.

The multifamily building permit totals for both years were impacted by Pullman developer Duane Brelsford Jr.’s five-phase, race track-themed apartment complex off of Northeast Valley Road at the site of the old WSU stables. Brelsford started construction in 2005 with the $14 million, 240-unit Emerald Downs complex, which was opened to tenants in August.

Brelsford broke ground on the second phase on Sept. 1. The $14 million, 203-unit Churchill Downs complex is expected to open in August.

Pullman saw about $3.7 million more in new commercial construction through August than in the same time period for 2005 because of a flurry of activity at Schweitzer Engineering Laboratories.

SEL constructed a new $5.3 million corporate office building and a $5.2 million event center, both of which are expected to open in October.

The company recently broke ground on an $8.4 million, 100,000-square-foot manufacturing facility that is expected to bring about 300 new jobs to Pullman when it is complete.

Nearly $9 million in commercial remodels will be added to the tax rolls from projects like technology firm Isothermal Research’s $2.36 million expansion, the $760,000 expansion of the Bishop Place assisted living facility, and developer Mike Yates’ $500,000 renovation of the Square One Antique Mall building in downtown Pullman.

Another commercial growth spurt could come in 2007 with four new projects Brelsford is planning, including 15-acre and 10-acre developments that could bring some new national retailers to town, he said.

He’s keeping the details under tight wraps until he finishes negotiating with potential tenants, but said news about the four projects will come within the next three to four months.

Property tax revenues from 2005’s record level of construction will start to roll in to the city’s coffers in 2007. Property tax revenues from new construction in 2006 will be budgeted in 2008.

Even if the city doesn’t break its 2005 record of $64 million in new construction, it still is having a very good year for growth, City Supervisor John Sherman said.

“(Construction) is very strong and very balanced,” Sherman said. “It bodes very positively for the city.”
This is great news.

Apartments are great, but we still need more affordable single family housing. And it's hard to get too excited about sales tax from large construction projects, as that is a one-time shot and such projects can be cyclical. Also keep in mind that WSU will not pay any property taxes on either the new CUB or the Palouse Ridge Golf Course.

The most exciting news is the possibility of more national retailers coming to Pullman. Capturing sales tax revenue currently lost to surrounding localities is what Pullman needs more than expanding the property tax rolls.

I've predicted all along that once Wal-Mart was interested in Pullman, other national retailers would follow. Notice Brelsford used the time frame of 3-4 months, just about the time PARD's appeal will be settled. Also, I don't blame Brelsford for not dislcosing who may be interested. Though PARD has "saluted" him many times, he doesn't want to give the anti-growth moonbats a head start should they not approve of the retailers for his new developments.

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