SAN FRANCISCO - Seattle's active downtown life will gain more momentum with a new look for the city's municipal center and public safety complex, thanks to the city's $130 million limited-tax general obligation bond sale scheduled for Tuesday.
Most of the bond proceeds -- $86 million -- will go toward building a new city hall and a justice center, which will include the police headquarters and court system, in the city's south end. The city hall is expected to be completed in the second quarter of 2003 and the public safety complex by the fourth quarter of 2002. The rest of the proceeds are going toward several unrelated projects.
In addition, a public plaza eventually will be part of the mix, according to Dwight D. Dively, director of the finance division for Seattle.
In explaining the need for a new police headquarters, Dively said the department's current wiring is antiquated by today's standards.
"Sometimes workers have to unplug coffee machines before plugging in computers, because there just was not enough of an electricity supply to operate," Dively said.
A study also showed that buildings were seismically unfit, and that it would be more cost effective to construct new facilities than to expand current ones, according to Dively. Once the new complexes are up, about 1,500 city hall, court, and police employees will relocate there. The current buildings will be demolished.
Seattle Northwest Securities is the financial adviser for Tuesday's competitive sale, which industry sources say should do well.
"It got a great rating. The purpose is popular and one that people can connect to and like," said Judith Cochran, managing director of Banc of America Securities. "Plus the structure, from 2002 through 2031, has a little something for everybody." Investors seeking short time, mid-range, or maximum yield will find it, she said.
Mark Froio, vice president of fixed-income trading with D.A. Davidson & Co., saw other factors affecting demand.
"Seattle is a good name and the Aa1 rating should attract interest nationally," Froio said.
Fitch assigns a AA-plus rating to the deal, in part because of the diversity of the economy.
"I think it is important to note that for the first time, there are more computer-related jobs than there are aerospace-related jobs within King County. That is a solid reflection of what is going on in the city as well. Software has surpassed aerospace in King County, and wages in computers far exceeds any losses in Microsoft," said Mark Chapell, a Fitch analyst, referring to the companies recent legal and financial troubles.
Moody's Investors Services assigns an Aa1 rating with a stable outlook for the transaction.
The agency noted that signs of an economic slowdown has been detected, but added it "anticipates that the region's economy will remain healthy, though growth will occur at a much more moderate pace than in recent years."
Standard & Poor's rates the bonds AAA. The agency also raised to AAA from AA-plus the city's rating on outstanding unlimited tax and limited tax GOs issued by Seattle Museum Development Authority, Seattle Indian Services Commission, Pike Place Market Preservation & Development Authority, and Seattle Chinatown International District Preservation & Development Authority. It also revised the outlook on those bonds to stable from positive.
Seattle last issued limited-tax GOs two years ago, according to Michael Van Dyck, debt manager for the city, who expects a strong reception.
"We have one of the highest per capita among triple-A cities," Van Dyck said.
The population grew by 9% from 1990 to 2000, according to Van Dyck, citing the recent census.
The construction work for the two facilities is slightly south of the downtown hub, where government buildings are located. Downtown has undergone a transformation in the past eight years.
Prior to the transformation, a major department store, Frederick & Nelson -- along with a lot of smaller businesses -- fell by the wayside. Even the local streets seemed to deteriorate and become unattractive, according to Dively. However, Nordstrom bought the former Frederick & Nelson building, invested $100 million in redeveloping it, and helped turn around downtown.
The downtown revitalization, which was the result of a public-private partnership of local businesses and city government, included an upscale mall called Pacific Place, and more available and affordable parking facilities.
"After the fact, we now have universal praise," Dively said. "We also have an 18-hour downtown instead of a 10-hour downtown."
Another public-private partnership worked to expand the convention center.
"Now you see people shopping and going to the movies. It has really, really transformed downtown," said Van Dyck.
The limited GOs are authorized by the city council, and are not subject to voter approval. Washington as a whole has been challenged with a plethora of referendums designed to lower taxes.
Each city has its own public projects, for which a cookie-cutter approach would not work. Dively says Seattle's strong regional economy has helped the city accomplish its goals.
For Seattle as well as other municipalities, one basic tenet applies, according to Dively: Honestly assess what the municipality's current state is, not what it used to be.
"We never lost our downtown," Dively said. " It was something that was declining, but it wasn't gone. There were key strengths to build and we did not try to create something that didn't exist. If we had waited 10 more years, it would have been much harder."
Another factor to consider is gauging public perception and then taking appropriate action. A survey showed that the average consumer did not want to pay $15 for two hours of parking, so creating more spaces by building a garage was essential, Dively said.
As part of the same projects, the city expects to issue another $50 million in limited tax GOs next year, according to Dively.
As far as downtown as a whole, Dively says it is a success.
"There is a lot more revenue generated , and people love it," he said.
