Drafter
Clerk 05/05/2026
Title
AN ORDINANCE approving King County's partial participation in the city of Bellevue's Tax Increment Financing project, as authorized in RCW 39.114.020; and specifying conditions on the county's participation.
Body
PREAMBLE:
Under RCW 39.114.020(1)(c)(ii), the city of Bellevue is authorized to enact a tax increment area up to $500,000,000 in combined assessed valuation, but only if the area is connected to Interstate 405, transportation-related public improvements will be funded to enhance the integration and connection of neighborhoods within the area, and the city enacts the tax increment area via ordinance by June 30, 2026.
Under RCW 39.114.020(1)(c)(ii)(D), King County, in its role as a governing body of a taxing district within the increment area, may approve by King County's partial or full participation in the tax increment project. If King County does not approve its participation, then King County’s property taxes are not subject to apportionment.
King County has provided leadership regionally in the formation of multimodal transportation systems, including the forty-two-mile Eastrail corridor as well as in Sound Transit leadership and decision-making roles. King County supports transportation improvements to improve mobility within downtown Bellevue, new commercial and residential construction to support economic development, and pedestrian-oriented improvements linking the EastRail Corridor, the recently upzoned Wilburton neighborhood, downtown Bellevue, and Meydenbauer Bay park.
The city of Bellevue's Grand Connection Crossing will connect downtown Bellevue to the Eastrail Corridor and to the Wilburton neighborhood, where new local housing policies have incentivized affordable housing development.
Those improvements and new construction activated by the city of Bellevue's Grand Connection Crossing are not assumed to occur at the same level without additional financing tools dependent on King County's participation in the tax increment area.
City of Bellevue staff have provided King County with assurances that the tax increment area can be successfully enacted with safeguards for county taxpayers, including:
1. Excluding of voter-approved King County levies and levy lid lifts from apportionment; and
2. Capping the total amount of apportioned property tax revenue that King County will contribute to the city of Bellevue's tax increment area.
To further reduce the loss of property tax revenue by participating in the city of Bellevue's tax increment financing for the Grand Connection Crossing and consistent with RCW 84.55.010(1)(e), which authorizes the county, as a taxing district within the city of Bellevue's tax increment area, the county may increase its annual regular property tax levy amount to make up for the loss of property tax revenues that would be generated from the anticipated increase of assessed value of property in the city of Bellevue's tax increment area over the term of the tax increment financing.
BE IT ORDAINED BY THE COUNCIL OF KING COUNTY:
SECTION 1. King County approves its partial participation in the city of Bellevue's tax increment area, subject to the following conditions:
A. King County commits to a maximum of $30,000,000 in support for the Grand Connection Crossing through apportioned property tax revenues from the allowed components of the county levy for 2028 through 2051, reduced by any revenues received by the city of Bellevue from the King County Transportation District, or its successor. Cumulative apportioned property tax revenues, reduced by any revenues received by the city of Bellevue from the King County Transportation District or its successor, that are in excess of $30,000,000, shall not be apportioned by the county assessor to the city of Bellevue;
B. King County's apportioned property tax revenues for each calendar year will be reduced by the amount equal to revenues received by the city of Bellevue from the King County Transportation District or its successor, in the previous calendar year. King County's apportioned property tax revenues for each calendar year cannot be less than zero;
C. Starting with tax year 2028 and for each tax year through 2051 or the tax year for the year the city of Bellevue sets as the sunset date for the Grand Connection Crossing tax increment financing area, whichever is earlier, consistent with RCW 84.55.010(1)(e), the county may set its levy so that regular property taxes payable include an additional dollar amount calculated by multiplying the regular property tax levy rate of the county from the preceding year by the increase in assessed value resulting from any increase in the assessed value of real property located in the city of Bellevue's tax increment area. In accordance with Section 410 of the King County Charter and RCW 84.55.010(1)(e), if as part of any proposed property tax ordinance in which the King County assessor has calculated the sum for property taxes available to the county that does not include the increase in the assessed value of real property located in the city of Bellevue’s tax increment area referred to as Grand Connection Crossing, the executive shall include with the transmittal of the proposed property tax a report with the dollar amount attributable to the increase in assessed value of real property within the city of Bellevue's tax increment area if the dollar amount were to be included in the assessor's calculated sum;
D. Upon passage of legislation by the council approving the county accelerating its payments of property tax revenues to the city of Bellevue in support of the Grand Connection Crossing and in the county's sole discretion, the county may, in accordance with this subsection, remit the present value of all of the remaining, outstanding anticipated apportioned revenues known as the "Outstanding Commitment" during the following time periods: (1) before the city of Bellevue issuing any bond series associated with the tax increment area; (2) no more than ninety days before the call date of any bond series associated with the tax increment area; or (3) at the county's sole discretion, at any time before the maximum $30,000,000 commitment is reached. The county will pay the cost of any negative arbitrage associated with retiring the proportional share of the Outstanding Commitment of any related bonds issued by the city of Bellevue. The present value shall be determined by applying a discount rate to the Outstanding Commitment so as to determine the county’s accelerated remittance under this subsection. The discount rate is equivalent to the borrowing cost to King County or the city of Bellevue, whichever is more favorable to the city of Bellevue, in their sole discretion, for debt of a similar term as the remaining Outstanding Commitment as of no more than ninety days before the date of the accelerated remittance, assuming level debt service. If the county fully remits all the Outstanding Commitment under this subsection, apportioning of county levies shall cease and the county’s participation in the city of Bellevue's Grand Connection Crossing shall be fulfilled;
E. Once King County's commitment of support has been met under either subsection A. or D. of this section, then the county assessor will cease apportionments from the county levy, regardless of whether the tax increment area is fully sunset or whether the sponsoring jurisdiction has provided the certification described in RCW 39.114.050;
F. The city of Bellevue must, at least annually, reimburse King County for documented assessor and treasury costs;
G. Notwithstanding the county's full remittance of the Outstanding Commitment under subsection D. of this section, the city of Bellevue will provide King County with a list of planned public improvements, an annual report of public improvement expenses for the Grand Connection Crossing, and an annual report of the city of Bellevue's affordable housing accomplishments including but not limited to the number of new affordable housing units created, by Area Median Income category, by April 1 of each year throughout the duration of the city's tax increment area; and
H. For county property revenues received from 2028 through 2041, the apportioned levies are limited to the county's levies for current expense, human services fund/mental health, veterans' aid, transportation, marine, and county hospital, or their successors. Additionally, county property tax revenues received from 2028 through 2041 shall not be apportioned from voter-approved levies and voter-approved levy lid lifts or their successors, whether currently effective or subsequently approved by voters. Any new levy, not otherwise described in this section, that is effective after the effective date of this ordinance shall be exempt from participation and shall not be apportioned unless specified otherwise in the levy's enacting ordinance.
SECTION 2. The authority granted in this ordinance is supplemental to all other powers of the county, and nothing in this ordinance shall be construed as limiting or restricting any powers or authority conferred upon the county by law.
SECTION 3. Severability. If any provision of this ordinance or its application to
any person or circumstance is held invalid, the remainder of the ordinance or the application of the provision to other persons or circumstances is not affected.