Human Services, Labor, and Economic Development Committee 07/17/2026

Good morning.

The Human Services Labor and Economic Development Committee meeting of the Seattle City Council will now come to order.

It is 9.33 a.m.

Friday, July 17th, 2026. I'm Councilmember Alexis Mercedes Rank, chair of the committee.

Will the committee clerk please call the roll and let the record reflect that Council President Hollingsworth and Vice Chair Foster are excused.

Councilmember Juarez.

Here.

Councilmember Saka.

Good morning, here.

Chair Rink.

Present.

Chair, there are three members present and two excused.

Thank you.

We will now move on to approval of today's agenda.

If there is no objection, the agenda will be adopted.

Hearing no objection, the agenda is adopted.

Thank you, colleagues.

We have a robust agenda for today.

First, we have a briefing discussion and possible votes on an ordinance brought to the council by Seattle Human Resources Department and Seattle IT, which modernizes the classification series for information technology professionals across the city.

The departments say that this update is crucial to the city's ability to attract and retain IT workers.

Following that, there will be a briefing from the Office of Economic Development, or OED, regarding commercial affordability issues in Seattle.

The affordability crisis in Seattle isn't just hurting people and families, it's also impacting our local businesses and neighborhood business districts.

And our Office of Economic Development has long worked to support small businesses and invest in our neighborhood business districts.

And this work has given them unique insights into the many challenges facing our small businesses, and I'm really looking forward to hearing directly from them today.

and then we will close with a round table discussion with small businesses on how they're being impacted.

From securing a good lease to funding tenant improvements to dealing with skyrocketing insurance costs or permit surprises, our small businesses and the folks who lease to them have to navigate a lot to make ends meet in the best of times.

and I think we know we are not in the best of times right now.

So we're going to be hearing from folks on the front lines of commercial affordability crisis and about the headwinds they face in trying to build and find space for their businesses.

And it is my hope that we can learn from the most impacted and work together to identify ways to remove some of these obstacles that people are facing.

And with that, we will now open the hybrid public comment period.

Public comments should relate to items on today's agenda or within the purview of this committee.

Clerk, how many speakers do we have signed up for today?

Currently we have two in-person speakers signed up and one remote speaker.

Thank you.

Each speaker will have two minutes and we will start with in-person speakers first.

Clerk, can you please read the public comment instructions?

The public comment period will be moderated in the following manner.

The public comment period is up to 60 minutes.

Speakers will be called in in the order in which they registered.

Speakers will alternate between sets of in-person and remote speakers until the public comment period has ended.

Please begin speaking by stating your name and the item that you're addressing.

Speakers will hear a chime when 10 seconds are left on their time.

Speakers' mics will be muted if they do not end their comments within the allotted time to allow us to call on the next speaker.

The public comment period is now open and we will begin with the first speaker on the list.

Thank you so much, clerk.

The first in-person speaker is Hind Ousley.

Whichever mic you'd like, make sure you keep the mic close to your mouth so we can fully hear your remarks.

Good morning, everyone.

Good morning, Chair Rink and Council members.

I'm Hind Oddsley.

I'm the Executive Director of Refugee Artisan Initiative out of Lake City.

Hello.

I joined in my position in Maine.

It's been a pleasure to work with a group of committed team members and artisans that we support through workforce development.

Our focus is on creating income through pathways that are sustainable for refugee and immigrant women that live throughout Seattle in addition to the Lake City area.

One of the things that we tackle is being able to not only provide the training and then find job placement, but also support the women who graduate in the textile industry or catering industry or other industries that they're interested in, be able to find a place where they can start their own micro-enterprise.

In Lake City, in particular, it's a wonderful location where there's a thriving community of immigrants and refugees.

However, we're daunted by the fact that there are a lot of businesses that are vacant, closed, where they have absent landowners or business owners, and it makes it very difficult for for new enterprises to start up and be able to find locations that work for them.

So as we look forward, we'd like to keep our enterprising pathways for our women and refugees in the areas where they live and work, like in Lake City and where they have a community, but it's very difficult for them to break into Lake City in particular.

So I wanted to highlight that as we talk about the affordability and commercialization aspect of the topic today.

Thank you.

Thank you so much.

Our next in-person speaker is Fatima.

Hi, good morning Chair Rank and committee members.

My name is Fatima Aram and I also represent Refugee Artists and Initiative.

My colleague just shared a lot of important things and I also wanna share more about the commercial affordability matters as it relates to our community.

According to a New Americans in Washington study, there are roughly only about 80,000 immigrant entrepreneurs and 7,400 refugee entrepreneurs in Washington, with only a small portion of them being women in Seattle.

Many of our artisans are interested in the entrepreneurial path.

A couple are currently small business owners themselves, as Hen mentioned, selling goods they've made, running enterprises out of their homes or shared spaces, markets, and storefronts across the city.

Rising costs for workspace materials and retail space directly determine whether the training and income generation work we do actually translates into lasting, sustainable, independent livelihoods.

As you hear from OED and other community presenters today on commercial affordability, we'd ask that refugee-led, immigrant-led, and women-led micro-enterprises stay a part of that conversation.

These are exactly the small businesses that citywide affordability policy can make or break.

I also would like to encourage for the council to think about how we can make it competitive to afford locally made items versus things that are international or cheaper even despite the tariffs that's been a challenge locally and additionally how can we compete with corporations like Amazon and others who provide delivery especially in a city where you may not have transportation to kind of access these materials and businesses.

And thank you to the City of Seattle for support through Human Services Department, Office of Arts and Culture, Seattle Public Utilities.

We're excited to keep sharing our impact through this funding that we've received and the participants.

Additionally, thank you for your time.

Appreciate your continued partnership.

Thank you so much, Fatima.

With that, we will now move to our remote speakers.

The first online speaker is David Haynes.

Please press star six when you hear the prompt, you have been unmuted.

Hi, thank you, David Haynes.

One of the worst things about Seattle is when the Downtown Seattle Association hired a retail advocate who testified before Council that the best sign of a healthy economy is when all rents are up.

And if you take a look at the low quality buildings that the small businesses are forced to share, like sharecropper rentals that are being shaken down, that are forced to debt service a police state economy of artificially inflated property values that devalue the working class values, we need to revisit the predatory stalking King County property assessor's damage to the economy when John Wilson purposely doubled and tripled the artificial inflated property values, never letting up on gouging the taxes.

And yet the politicians look the other way because they solicited off the property values.

But the problem is when the small business opens up, they don't have the robust floor space to offer the grace of personal space for the customer to make the neighborhood feel invited.

Instead, the customer is always rushed and hurried and bothered by the personal space that somebody else invades because of the flawed floor plans.

Like Seattle needs a 21st century first world quality redevelopment instead of trying to prop up the same dilapidated inflated flawed floor plans that are still owned by the banks that are shaking down the small businesses that are going to be welfare subsidized based on their skin color and their orientation.

for a short period of time, only if they keep propping up the artificially inflated property values that keep hitting the employer against the employee who does all the work, yet because of all the money that's being paid to artificially prop up inflated, dilapidated, flawed floor plans in the real estate, it's destroying the economy.

But when you all tame everything in a racist perversion, regurgitating hate

Thank you, David.

There are no additional registered speakers, so we will now proceed to our items of business.

And first moving to our first item of business, will the clerk please read item one into the record?

Item 1, Council Bill 121225, an ordinance relating to city employment, establishing the new information IT talent modernization classification, title structure, and corresponding rates of pay for IT positions across city departments, briefing discussion and possible votes.

Thank you so much.

And as our presenters get settled in at the table, you can please unmute your microphones and introduce yourself by stating your full name into the microphone for the public record.

Good morning.

I'm Dr. Kimberly Loving, and I'm the Department Director of Seattle Department of Human Resources.

Thank you for having us.

Good morning.

My name is Shannon Smith.

I am the Chief Technology Officer for the City of Seattle.

And again, good morning.

William Winfield.

I am the City's Labor Relations Director.

Good morning, Councilmembers.

William Smith, Chief of Staff for Seattle IT.

So bear with me, I haven't used this laptop yet.

So thank you for your time today.

Today we are bringing to you some proposed legislation for information technology talent modernization.

I just want to briefly go over the agenda, and then my colleagues and I will talk about the information that we have for you today.

So we're going to give you a little overview of the history of this initiative, the purpose of the proposed legislation, then we're going to speak to the current state, why we're excited to bring this legislation to you, the current financial impacts, and then speak to the next steps throughout this process.

Thank you.

So before we discuss the legislation itself, I'd like to provide just a brief amount of context about how we arrived here today.

So the city's IT classification structure has remained largely unchanged for nearly 30 years, while the nature of technology work has evolved dramatically.

As Seattle IT modernized its operations over the years and its services, it became increasingly clear that the classification specifications associated with that work needed to evolve as well.

So over the past several years, Our partners here at Seattle IT have undertaken a comprehensive talent modernization effort in partnership with SDHR to develop a classification framework that better reflects today's IT professionals and the work they perform.

The proposed framework is the result of market-informed research and established industry best practices.

and today's legislation is an important milestone in that effort and we are really excited.

It establishes the framework that allows the city to move into the next phase of this project, which our Labor Relations Director will now walk you through.

Thank you, Dr. Levine.

So the purpose of the ordinance that's being presented today, if passed, would allow the city to bargain changes to the city's IT classification and compensation program.

Currently, there are only three ITP or IT professional classifications, A, B and C.

And we would like to expand those classifications to a little over 40 to align with the actual body of work being done by the employees.

And again, the corresponding compensation program.

So again, if this legislation is passed, it would allow labor relations to engage in bargaining with local 77, who represents a little over 560 IT professionals.

And while there are other IT professionals that are represented by other unions, the goal of this legislation, if passed, would allow us to bargain with Local 77. Once we conclude those negotiations, if we reach an agreement, then those terms would subsequently go through our legislation process for approval and then implement it.

and once that's done, then we would engage with those other unions who have IT professionals that they represent.

Thank you, William.

So purposes of why this project is so important, there are many objectives, one of which is the consistency in pay practices.

We want to make sure that our IT professionals have an alignment in terms of their pay.

That is also incomparable to industry standard.

And when I speak about industry standard, I'm not necessarily talking about the Microsofts of the world.

I'm talking more so government agencies in this area in the region.

Retention and satisfaction.

We want to make sure that this project also helps in the retention of our talented IT staff, but also being able to attract talented staff as well.

So we want to make sure that our structure is transparent and provides for the opportunity for a huge morale boost.

The administration of the actual program allows us the ability to have clear and engaging conversations with our employees, our managers, and our union partners.

That is really important for us so that we can move forward in our organizational culture, but also for the ITP Series as a whole.

It helps reduce bias.

It's clear objectives as to where everyone sits.

It allows individuals to see their career path as they move forward.

And, you know, there's opportunity for individuals to say, hey, I love what I'm doing now, but I want to be in this job two years from now.

It provides clarity and clear path for individuals to be able to do that.

And then lastly, the budget consistency.

As we know, as we tackle of the budget throughout the years, it's very important to understand clearly what's happening from a budget perspective.

Within this classification, we will clearly be able to communicate with our union partners, but also be able to make departmental-wide decisions based off of the information that we have, which this project will allow us to do.

So when we speak about budget, we also want to call out the financial impacts.

At this time, the legislation that is proposed have no financial impacts.

There will likely be financial impacts when employees are placed into this new structure, but all of this cannot be determined at this time, and it would be subject to bargaining.

Any potential downstream financial impacts would be presented to council for with future legislation as part of the collective bargaining agreement with 77. So in terms of next steps, we ask that the Council approve this legislation.

After that, we will prepare for bargaining.

Once those negotiations are complete, we would return with future legislation, and then we would implement the bargained structure after that.

So we appreciate your time.

We now pause to see if you have any questions for us.

Thank you so much for this overview and for your work on this.

Colleagues, opening it up to you first for any questions you have for our panel on this presentation.

Not seeing any questions right now.

Well, I'll at least ask one for today, just a matter of understanding that this classification change will affect nearly 600, if I heard correctly, or between 500 and 600 IT professionals across the city of Seattle.

Can SDHR and IT just explain, just break down the current and proposed classification structure and just highlight those key differences?

So, thank you for the question.

So currently, there are three classifications in the IT professional classifications.

They are the A, B, and C, with the A being the highest in the series.

What we're proposing within this legislation is to be able to bargain expanding those classifications to over 40 that identify the actual bodies of work that are being done by those employees in those classifications and including the types of domains of the work that they actually do.

So that's why we're proposing expanding that.

And again, it recognizes the actual work that the individuals are doing as well.

It also helps with recruitment and retention, because when you're identifying someone who does, let's say, website-related work to actual engineering-type work, it's different.

So we want to make sure that we're identifying that with the employees and respecting those roles and their experiences in those different classifications.

And so we do have roughly 550 employees who have this classification.

The majority of them are in Seattle IT.

There are a few in some additional departments, but we continue to communicate with those departments and we'll work with them over time.

But our focus today is really on Seattle IT, my department.

Well, colleagues, if there's no additional questions right now, I do intend to put this to a vote to advance out of committee today.

So final call unless there's any comments or questions.

Hearing and seeing none, I move that the committee recommend passage of Council Bill 121225. Is there a second?

Second.

It is moved and seconded to recommend passage of the bill.

Any final comments?

All right, will the clerk please call the roll on the committee recommendation to pass the bill.

Council member Juarez.

Aye.

Council member Saka.

Aye.

Chair Rink.

Yes.

There are three in favor, zero opposed.

Thank you.

The motion carries and the committee recommendation to pass the bill will be sent to the July 28th full city council meeting.

Thank you all for being here in committee this morning and for your work on this.

Excited to see how the work moves forward.

Thank you.

Thank you very much.

Thank you colleagues.

We will now move on to our second item of business.

Will the clerk please read item two into the record.

Item two briefing on commercial affordability for small business briefing and discussion.

Thank you so much.

At this point I will be inviting up our colleagues from the Office of Economic Development to come up to the table.

Wonderful.

Good morning.

Thank you so much for being here today.

And when you get settled in, take a moment to introduce yourself for the record.

Thank you.

Alicia Teal, Deputy Director, Seattle Office of Economic Development.

Heidi Hall with the Office of Economic Development.

I'm Jen Shroni at OED as well.

Please proceed with the presentation.

Okay, great.

So we're here to give some quick framing briefing around our Office of Economic Development, our OED's work on commercial affordability.

And before Heidi and Jen take it away, I'll just do some quick level setting on OED's role overall as an office.

Our overall focus is leading projects and making investments that open up access to economic opportunities, reduce the racial wealth gap, and encourage innovation and growth.

And all of this is guided by the community-driven Future of Seattle Economy Framework, which was adopted as city policy in Resolution 32099. So the Future of Seattle Economy Framework sets out five pillars for inclusive economic growth.

Those include investing in talent and building our workforce, supporting small businesses and women and minority owned business enterprises, growing businesses and key industries, building community wealth in communities of color, and investing in neighborhood business districts.

And so commercial affordability crosses a few of these pillars.

And in our work, we also seek to strike a balance between supporting our local economy and competing in the global economy.

Since our economy is an ecosystem and we really need both, they are mutually reinforcing.

And our commercial affordability work, I'll just give the caveat since it's a term that can be broad.

It really focuses on small businesses or brick and mortar businesses in neighborhoods.

We also know that there are many macroeconomic factors that affect affordability for businesses.

and as we've done our work we have tried to also understand where does the city have levers and influence even on things for example like capital access.

The other thing I'll note just about how OED does our work in general is we try to keep in mind three distinct roles that we have and of course they overlap in some ways too.

We are a responder and implementer.

We provide direct service to businesses and part of our goals is to be highly responsive to businesses that also need help just navigating city resources and requirements.

We also have embraced the role of organize and build and how do we knit together some of the systems?

And so what lessons are we learning from direct service?

What trends are we seeing?

and how are we looking around the corner to really understand what businesses of all sizes need in the economy?

And last but not least is that envision and transform element of zooming out and taking that larger look at our economy.

So that is how OED approaches our work in general and I'm really excited for this opportunity to highlight how our commercial affordability work goes.

So Heidi, I'll pass it on to you.

Thank you, Alicia.

Thank you, council members, for having us here today to talk about this really important work.

So I'll briefly just build on what Alicia was saying.

And one pillar of OED's work is investments, partnerships, and policies to build community wealth through business ownership.

And we primarily see this through business ownership and local ownership of assets.

Community wealth building is a transformative approach to economic development that keeps wealth in our communities with an emphasis on economic justice, shared wealth, and local ownership.

The city's work builds on more than a decade of neighborhood organizing and community partnerships, and we're continuing to evolve strategies in partnership with community and small businesses, similar to what Alicia said about learning from the work that we're doing and really trying to look ahead and see where we can transform systems and opportunities for small businesses.

So we do this through several core strategies.

First, ownership and tendency of commercial real estate to anchor small businesses in neighborhoods or provide pathways to return.

We'll be talking a little bit more about that this morning and hearing from some of our small businesses.

Second, a big strategy is around access to affordable capital and locally rooted financing to support business growth and reduce racial disparities.

We're also building business support ecosystems and pathways for growth, recognizing business ownership can be a path to generational wealth, especially in our BIPOC and immigrant communities.

We're also considering opportunities to stack investments in neighborhoods to advance community wealth.

And finally, piloting scalable models that keep wealth in community, for example, exploring new work this year around succession planning and employee ownership.

And so around our strategy around commercial affordability, we're focusing on several core outcomes, primarily stability and control of commercial spaces through ownership or long-term leases, allowing an owner to invest back in their business and providing opportunities for shared ownership and community.

Also, investing in the business's infrastructure to increase their profitability.

The commercial space is one of the most expensive and potentially volatile for businesses, we heard a little bit already, who often spend a lot of their working capital just getting into a space, let alone running the business, and so providing that platform for generational wealth through business ownership.

And then finally, also enhancing neighborhood vibrancy by keeping local businesses rooted in their neighborhoods and reducing vacancies and thinking about better quality commercial spaces, better quality leases.

So we've been at OED really working on, I know this is a scary slide, but we've been really working on a continuum of programs and investments to support small businesses.

And so this graphic shows how our programs scale from low barrier stabilization focused supports to higher investment programs designed for established growth ready businesses.

And I'll briefly touch on these this morning.

There's a lot more information on our website as well.

So first, our accounting and business consulting program gives small businesses expert advice to help stabilize and strengthen their operations and finances in all of our commercial affordability programs.

to collaborate with the ABC partnership.

We also do commercial space consulting, which helps with landlord advocacy and lease negotiation support to help mitigate displacement of small businesses, also supporting our larger commercial space investments.

and I think we'll be hearing from some of those partners this morning as well.

Seattle Restored pilot storefronts for entrepreneurs while reducing vacancies.

They primarily have been operating downtown in our south downtown neighborhoods and also piloting larger vacancy activations in some of our neighborhoods.

This year we were piloting a pre-lease program to think about helping businesses get lease ready, and they receive consulting and technical services.

This helps fill vacancies with stable businesses ready for long-term operation and increase retention.

And then our capital access program, the affordable financing piece, is a really important part as we think about any of our programs across our community wealth building team, including our commercial affordability.

We're increasing access to capital for historically underserved businesses through partnerships with our local community development financial institutions.

We're trying to make capital, lowering the cost of capital, currently through an interest rate buy-down approach, and also getting businesses capital ready and understanding what their financing needs are for their business.

And then the last two I'll touch on is our Tenant Improvement Program, which provides equipment and signage awards to help businesses grow, stabilize and grow, and also larger build-out projects to invest in neighborhood anchors.

And then finally, our Business Community Ownership Fund Program provides long-term affordability and control through ownership of commercial spaces.

really anchoring small businesses and neighborhoods or providing pathways to return.

And this program is implemented in partnership with Grow America, who matches city funds with financing and grants.

It launched as a pilot in 2024, and we closed on our fourth project earlier this year, announcement coming later in the year.

And so I'll now turn it over to Jen to share how these investments really come together in specific areas.

Hey, everybody.

I just want to illustrate a bit about how these different services and programs can work together and be really tailored to a neighborhood's needs.

So I'll start with talking about Lake City.

I want to call back to some of the public comment earlier.

In 2025, we decided to work with Building Lake City Together to bring Seattle Restored to the Lake City neighborhood.

And we ended up expanding to work with about 24 businesses to pilot storefront locations in that area.

and this was based on talking to a bunch of different neighborhoods, hearing about their needs and finding what would be the best fit and how we could meet those needs.

So in Lake City, there were and still are a lot of vacant spaces and less activity along the main street.

So this was part of a strategy to partner with those already in the neighborhood and support that need.

After Seattle Restored, we were able to relaunch the pre-lease program, and this actually came partially from the need of those Lake City pop-ups wanting to stay in the neighborhood and needing support to do that.

We also leverage ABC support throughout all of our programs, so provide wraparound support to businesses who need help with finances, marketing, business development, yeah, really all-inclusive there.

Also, this led to us rethinking about the Coyote North building in Lake City as a potential space for BCOF to more permanently anchor businesses in the neighborhood.

And this also created more connections for us within the neighborhood, leading to the Reuse Commons project through Seattle Restored.

And then the next neighborhood I'll talk about is Othello.

We've worked really heavily in Othello, especially through the Tenant Improvement Program with about 14 projects completed already.

We have four new finalists in this neighborhood.

And this is largely because Othello is a really vibrant, high-density business district with a lot of smaller micro-businesses owned by immigrants that have been in the area for 10, 20, 30 years.

So wanting to support the strengths and vibrancy already present in that area.

Also, there are a lot of older commercial spaces, multi-tenant commercial spaces, in this area and so we have done a lot of commercial space support through our consultants with lease negotiation, helping with things like getting a lease for a business that hasn't had one or helping with infrastructure issues in buildings just due to aging infrastructure in that area.

Also, I want to mention that BCOF in a new strategy this year has purchased two new commercial spaces in Othello.

A lot of development is also happening in that area.

So we wanted to make sure that small independent businesses could be anchored in those newer spaces as well.

And then I'll just say, Heidi mentioned this, but our ABC and Capital Access program provide wraparound support for every business that we work with.

So that's a resource we mentioned to everyone.

So these are some of the challenges we have identified in our work with small businesses over the past several years.

We will hear from small businesses and our community partners about their experiences with this, but I just want to highlight a few important barriers, which Heidi also mentioned.

So the barrier to enter commercial spaces is pretty high for businesses and can be very destabilizing if they're early on in their business journey.

This includes the cost of construction, permitting timelines, extending the time before they can actually start to continue operating their business and earning income again in that space.

And then also just continual lease education, even with veteran business owners who have been established in their space for many decades.

Again, what we're seeing is even those business owners might not have a lease, might have challenges with their space.

And so we've done a lot of advocacy and connection for those business owners to help establish strong leases, whether they are early on or later on in their journey.

Great, thank you.

And just to add to some of the challenges that Jen highlighted that we're gonna hear from our businesses, so our team is working to address some pieces of this.

Our team's working on some commercial transparency legislation, and we anticipate submitting that, something to counsel in the coming month, and look forward to discussing that further.

So I guess at this moment, we'll transition to our round table, unless there were any immediate questions.

Colleagues, are there any questions on this material from the Office of Economic Development?

not hearing or seeing any.

And so to make sure that we hear directly from our small businesses, I am going to thank our panelists right now and pivot.

And colleagues, as we go into this next part of the agenda, I am gonna put us at ease just during this transition, okay?

So we'll be right back in a second.

is the key.

All right, thank you colleagues for allowing us to take that brief pause as we were transitioning.

And now we are going to have the clerk read item three into the record.

Item three, round table on commercial affordability, briefing and discussion.

Wonderful, thank you so much for our panelists here today.

I know we have most folks at the table and we also have one of our panelists online as well.

If we can do just a quick round robin of introductions before starting the round table, that would be great.

Hello, my name is Shanti Bresna and I'm a small business development consultant who focuses on assisting small businesses with navigating all issues related to space, commercial space.

I work in Chinatown International District for Seattle Chinatown International District Preservation and Development Authority.

I've done that part-time for about 10 years, and three years ago I also started assisting OED with their commercial space consulting program and now pre-lease program.

Hi, everyone.

I'm Gabriel Newman.

I use he, him pronouns.

I'm the Director of Policy and Advocacy at GSBA.

We are a statewide LGBTQ and allied business association and Capitol Hill's Chamber of Commerce, and I work closely with our small businesses also in providing legal consultation and answering some questions through their processes as small business owners.

Hi, my name is Jiaxin.

I'm the owner from Oink.

So we got some help from the commercial lease negotiating from the CREs.

That's how we can, I think, represent the small business who got help from this program.

Wonderful, thank you so much.

Thank you all for being here today and thank you for also again OED walking us through the work.

In terms of structuring our discussion, if folks want to take a moment and talk a little bit more about the immediate challenges that they see in their work and just some historical context that they'd like to share and then would love to open it up, I have a couple of questions to kick us off as well.

So, Jen laid out some of the factors kind of more broadly that contribute to commercial affordability challenges, but I think I can elaborate a little bit.

And I also just wanted to mention that this effort around commercial affordability that OED has shepherded started in 2015 with the Commercial Affordability Advisory Committee, convened by the mayor at that time, and it has made it through I guess four administrations now, which is a pretty impressive level of commitment and also I think is a test to the level of need in this area around space.

So just the most simple factor is rent, of course, base rent, and base rent never really goes down.

It only goes up even when there are significant changes like the pandemic.

Rents have slowed the acceleration a little bit, but it's still a challenge, and this is one of the main things that Chris Maycutt and myself, we do as negotiation assistants, is to help people negotiate rent.

We assist businesses with proving what the market rents are in order to influence landlords to accept lower rent prices.

The other part of that, though, is it's not just about whether or not the rent is fair from a market perspective.

It's also whether or not the business itself can afford it.

and that's where the pre-lease program comes in, which is a pilot this year, and that's really about more in-depth work.

Most of the work that we do is in, there's 10 hours that are allowed and it's kind of like emergency jump in, help people with difficulties with their landlords.

The pre-lease program is intended to take businesses that have been operating through pop-ups or markets and haven't had a commercial lease before, make sure that they're ready, do business planning with them, help support them in strategic thinking about how they're gonna expand when they take space, connect them with financial resources, help them understand tenant improvements, help them understand permitting, and make sure that they're ready and that they can afford that.

And I think we've heard, thank you to the micro enterprise folks that came earlier.

There's a really big distance between being a micro enterprise and being able to afford a commercial lease.

Commercial leases are very serious.

They're not like residential leases.

They are contracts, binding contracts, that usually involve a personal guarantee clause, which means that it's not just the business's resources that are obligated to the lease.

It's their personal resources, and folks can be bankrupted.

They can take people's assets, and this is pretty much universal at this point.

So very serious.

So that's what the Prelease program is intended to address.

The other thing that I wanted to talk about, and this is something that has changed a bit since COVID, and that is TripleNet.

And this is getting into the weeds, but I'm going to get into the weeds a little bit, because that's what I do.

TripleNet is the extra rent that is not actually explicitly It is the amount above and beyond the base rent that is agreed to in a lease that includes So it's triple because it's a share of the building insurance, the building property taxes, and then the building common area maintenance.

And since COVID, as there's been more vacancy and property interests are struggling, there has been more and more and more that is put into the category of common area maintenance.

and this is resulting in situations where even though you have the same lease, when there is a property change, a property owner change, you'll see situations where the triple net doubles.

I'm working with a client right now.

It's a small independent gallery in North Capitol Hill.

They had the same lease, had it for three years.

The triple net clause in the lease is so all-inclusive at the same time that it is vague that when there was a change in the property ownership, they said, oh, all these other costs are now included.

We get to pass on all these other costs that are really the building costs.

And so we're in negotiation over that right now.

We're working on a cap on that so that even if she accepts some amount of an increase, she won't at least next year have even more and even more and even more, which is what happens.

And I would say that this is an increasingly important issue.

Both Chris and I, in terms of the referrals that come through OED, we're seeing more and more about TripleNet.

And then Jen also mentioned just the sheer cost of improving space.

For new spaces that are out there, restaurant spaces, you can easily spend over $500 per square foot.

on building out of space.

And so for a restaurant that's about 2,000 square feet, that could easily be a million dollars.

It usually is.

That's not something that a new small business can afford.

And existing long-term businesses, you can't just let your space sit.

Over time, you have to improve it.

And improvements are really, really expensive.

So one of the things that we have as part of the commercial space consulting team is this wonderful man named Cesar Casasbo, who is a retired, very, very experienced contractor.

I call him Mary Poppins, because he's done everything under the sun.

And I'm working with Latina Bakery, who is trying to get her first space.

This is through the pre-lease program.

And we're looking at a space with a great landlord.

Needs some significant improvements, because it's a retail space now, and it will be a bakery if this succeeds.

and the initial pass on the budget was $500 per square foot and over $500,000 for the improvements.

And this is in part because the requirements for any type of food business at this point through permitting are so onerous that this is where we're at.

So Cesar helped us.

We did also have to make some changes to her business plans, some pretty intense cutting.

He's helped us get it down to 200,000.

which is, I am very grateful to him.

So this is, you know, the tenant improvement grants address this, but also the consulting support helps people with making sure that the money that goes in is efficient and nothing is being wasted, and also that we're getting stuff out of landlords as well.

And then the last thing that I wanted to mention is permitting.

So permitting at this point for storefront spaces is incredibly complex.

You have local special districts, like the International Special Review District, that have authority over what goes into the storefronts.

You have Seattle Department of Construction inspections with a whole host of different codes that have to be satisfied.

You have King County Public Health with a public health code, as well as the plumbing code.

You have Washington State for wholesale regulation and the Liquor Control Board.

And sometimes these codes are in conflict.

So, for example, ISRD has a use code that is different, that's the International Special Review District, has a different use code than Seattle Department of Construction Inspections, and you have to get a use approval from both of those entities, and you have to fit into different use codes.

So folks need help is basically what I'm saying, and that is a big part of what the program helps provide, is assistance in navigating all of this.

Thank you for that overview Shanti and I have so many questions about the points that you raised and I do wanna make sure, I apologize, we have an additional panelist that we haven't heard from yet and hasn't had a chance to introduce themselves.

So I wanna turn it next to Nikita who is joining us online to introduce yourself and share a little bit about your work.

Thank you, hello committee members.

My name is Nikita Mathis and I'm the proud owner of a legendary business in Southeast Seattle called Platinum Plush Fashions.

Excuse me.

I've been in the, like I said, I've been in the Rainier Valley community for over 25 years.

And I just simply want to thank OED, Jen, Shanti for investing in a small business like mine through the Tenant Improvement Fund.

My overall experience with the program was pretty positive.

The financial assistance that I received was invaluable, but what really made this journey, the greatest impact of this journey rather, was the guidance and the support that I received from Jen, but especially I wanna highlight Shanti Perezno.

She was just extremely instrumental and helping me navigate through this trickery long-term lease agreement.

I was dealing with a new management company and just her knowledge from the beginning to the end of that process, I was just grateful for her.

I felt empowered.

I felt strong in all of this.

And like I said, the only challenging part to this was the process of negotiating this commercial lease.

Shanti mentioned earlier the triple net.

I knew nothing about triple net.

And there was just a personal sense for me that this new management company was just gonna go for the juggler.

If I hadn't had Shanti and her expertise and knowledge in negotiating commercial lease agreements, I felt like I really would have gotten the shorter end of the stick.

So shout out to Shanti.

She was really my rock throughout this whole process.

I wanna say that post the improvements, post the allocation of the funds that I received, there wasn't really any wraparound support or services going into the future for me or my business.

I didn't see that.

I don't feel like anything was offered as far as any support.

So it's almost like as soon as the project completed, it was over.

and so again, I'm forever grateful to OED, Shanti, Jen, and just thank you for navigating the process as easy as it was for me.

And that's all I have to say.

Thank you.

Thank you so much for being here, Nikita, and for sharing about this work.

Moving next to Gabriel.

Yeah, I can jump in.

Hi, everyone.

I really wanna echo what has been said already.

Big thank you to OED because they have really, over the years that I've had the pleasure of working with them, really responded to the needs and the requests and the experiences of small businesses with the focus on making sure that they can really flourish and sustain in Seattle.

So I really wanna give a shout out to that.

And what I've seen with working with small businesses as they navigate their commercial leases is really the idea that you don't know what you don't know.

And oftentimes, when you go into a lease agreement, there is a power dynamic where you're often working with a leasing company that knows what they're doing.

They've done this before.

and as a small business owner, your mind is in a million different directions.

You're thinking about a million different zoning codes and how you're gonna get your product and your suppliers and all of the different things.

And so as you're entering into a lease negotiation, you might not know what questions to ask or what type of information you really need in order to be able to make an educated decision on that specific location.

I supported an individual who was trying to move their tattoo parlor and This small business owner is fantastic at his job.

He's had a very successful small business in his current location.

But while talking about his and negotiating his new lease for the new location, he didn't know to ask about the triple nets, for example, or what those were.

And so having an understanding to help Small businesses plan to know kind of what the triple nets have been in the past and what they what a potential estimate could be in the future You know, I think would be able to help them to really be able to navigate their next few years in business Which are essential years as they you know get up as they develop their wings and their consumer base, etc And so it's really about eliminating surprises and letting folks know exactly what they're signing into.

So another piece is this individual didn't know whether the location was properly zoned or not for a tattoo parlor, or how to get that information about its current zoning application.

And so if you sign a lease without knowing that, oftentimes and afterwards you find out that it is not permitted and then you have to spend six months trying to get that permit, which is six months of waiting and paying rent on a location that you were expecting to open up within a month or two.

And as these kind of issues pile and pile, it makes it much more difficult for those businesses to sustain in the years to follow.

and so I think that there can be improvements made in terms of creating kind of a list of what are some issues that are common for new tenants to consider as they enter those negotiations.

Oftentimes people don't have the financial capacity to work with a broker and so that are often entering into these conversations on their own.

And so I think additional programming and support from the city could be really valuable in equipping those folks with the tools that they need in order to feel confident in those discussions.

And a list of questions, for example, if your lease says that it is your responsibility to take care of HVAC systems or different systems within your business, asking about the status of those.

How are they currently?

Am I gonna have to replace my HVAC in the next year?

Because that's something I would need to know as a small business, but might not necessarily think to ask while you're in the middle of those conversations.

So, I think having some kind of some easy, there's some easy fixes and easy pieces of our ideas to kind of empower folks to be able to know what they're doing.

And then I think this would also just kind of build onto the work that we're currently doing to support the overall financial issues and challenges associated with opening a small business, whether it be you know, permitting and regulatory issues, but also just the affordability crisis is really impacting everyone, including our small businesses as well.

So while folks are negotiating for the best lease agreement that they can get, they're also having to navigate insurance.

Can they get appropriate and costly insurance in their area.

There are some parts in the city in which a small business, depending on their industry, cannot get insured.

And so these are issues that folks need to figure out before obviously signing a lease in that location.

And all these pieces kind of come together to develop the ecosystem of a neighborhood as well.

If we're thinking about what are the types of businesses that we want to open and obviously it takes all kinds.

We welcome everyone, but small businesses that come from and are representative of the community are the ones you often see them giving back in terms of creating spaces for folks to come in.

creating activities, participating in community art walks, things like that.

And those are the types of relationships we really want to create and that really create a sustainable long-term vision for a local economy and for a neighborhood.

and I think this type of work is really needed to kind of uphold that pillar and really support that ongoing sustainability, specifically with those power dynamics that exist with smaller businesses and potential landlords.

As a small business owner, when we negotiate a commercial lease, we don't have a long-term lawyer.

So when we see 50 pages leases, we feel really overwhelming.

So with the commercial lease programming, So they're gonna let me know what exactly I'm signing for.

What's the trap?

What should I looking for?

But even everybody told you, oh, you try not to put your personal grantor into the lease.

But in reality, it's not really possible, right?

The landlord don't allow.

and our first shop is in Capitol Hill, Harvard Market.

So as 10 years ago, it's really like happening place.

So all the business, all the unit have occupied, but after COVID, there's more and more vacancy.

So the triple net is issue, right?

So because the landlord, they have more insurance, they have more tax, they all pass through.

And with less tenant to share that triple net, you get higher.

So for example, my triple net is almost more than the base.

So that's the difficulty.

So if we can create some program to let more small business enter the vacancy into the plaza, they can keep everything down.

I understand as a landlord, they're also afraid, they take a lot of risk, they're afraid you come in and do something.

That's why the barrier to entry is so high.

So if with this program, a lot more small business, they can enter, they can stay, so everybody can share some there, pay their share, and the whole ecosystem is going to be better, because when customers come to this plaza, they feel, oh, it's happening, right?

It's all different business, but right now, a lot is empty, so they feel like, oh, what's going on, right?

Yeah, that's how I feel.

Even, let me see my note.

Yeah, that's our thought about this.

We have like a triple net, yeah.

Yes.

Thank you each of you for bringing up some of the challenges across areas from triple net, personal guarantee and permitting issues.

A lot to unpack here.

Colleagues, I want to turn it next to you for questions you have for our panelists.

Madam Chair?

Council Member Juarez.

Thank you.

I apologize for not using the little hand on the thing, but I'm just going to raise my hands because I know you can see me.

First of all, thank you, Madam Chair, for putting together a really good panel and my apologies for not being there and not knowing that our wonderful group, RAI, Hind and Fatima were going to be there.

As you know, we have a long history with RAI going back 9, 10 years.

And thank you, Madam Chair, for having an opportunity to talk to them and hopefully have them back again for more in-depth because I think they're a textbook example of just like North Helpline, Build Lake City Together, some of these smaller businesses, Coyote North, incubator businesses.

But what I loved about your panel from Nikita and Gabriel, and hopefully I'm saying this name right, is it Jackson?

Jackson Wing?

Yes, okay, I'm sorry.

I was just looking at, I was trying to make sure I said it correctly.

And Shanti's assistance because, and you mentioned this Madam Chair, I understood about the BIAs and the base rents and the frustration with permitting with STCI, particularly with small businesses and storefront places, but I wasn't aware of how difficult it was on the whole triple net thing.

I didn't know that.

So I learned a lot today and I want to thank you for that.

and particularly how much more challenging and difficult it got post-COVID with more vacancies.

And I just wish we had more shanties to walk small businesses through all these difficult and being a lawyer myself and also being married to a person who's an artist and a small business owner, I know that it's challenging with Citi.

And so when I was listening to Gabriel talk about what are easy fixes, Madam Chair, I'm just gonna look to your leadership.

I know that we could try to streamline things, the permitting and maybe have more workshops for small businesses.

But I also know that our new OED director, Beto knows how to with working with small business association knows how to streamline to get smaller businesses in the pipeline to get them up and going and brick and mortar.

And that's been a big, it's been a big, how do I say this?

That is something that I've been doing as a lawyer for almost 40 years in Indian country and rural communities and cities.

is taking an idea to fruition from including Climate Pledge Arena, which is a big thing, but also a little thing, like when we brought Coyote North up north, when we worked with RAI, when we worked with REWA.

So I want to thank you, Madam Chair, for putting together this roundtable so we can keep coming back to this issue about small businesses and the obstacles and challenges they face.

and how we can make it easier and sustainable for them to stay in our city.

And actually, as you know, they're the backbone of creativity.

They're the backbone of entrepreneurship and just navigating the bank scene alone.

I know that there's a program and I'll end here just because I just want to share this piece.

Brought back some triggering here.

Working with small business owners on the reservation and Native American people in the city of Seattle and other cities.

and walking them through the SBA process, taking a six-week class, having to learn how to do a business plan, how to present to a bank, how to get the smallest interest rate loan.

A lot of those folks, they're business people, but they're artists, they want to do their business like Nikita was sharing, but they're not necessarily lawyers and contractors and they don't do that stuff and they need someone to help them.

Thank you, Shanti, for how you walked us through this.

Thank you, Madam Chair, for putting together this great panel.

And again, I apologize for not being there.

I would have loved to have seen Hind and Fatima, but I was in contact with Hind.

So I'm hoping that we could do this again and get more in depth.

So thank you.

Thank you for those generous words, Council Member Wise.

And yes, full intent to bring in more of our small business partners and keep this conversation going in this committee throughout this year and potentially take up some action as well to address some of these issues that have been outlined today.

And I shared a number of similar reflections that you just shared with us just related to triple net.

I mean, the idea of triple net being more than base is pretty astonishing to me.

And so I thank you for elevating these points on that matter, as well as a number of other points.

And I want to thank you, Councilmember Juarez, for your careful and really focused work in the Lake City neighborhood related to formation of BIA.

I know this has been just something you've been very focused on.

And so I just appreciate your leadership.

Thank you.

I only have one thing to say, Cher.

Let's try to do it before I'm gone in November.

So I don't know what we can do, but I'll still be a D5 and I'll still be an asset for you and for these small businesses.

So thank you, Madam Chair.

Thank you.

That is the hope that we can have you potentially be able to vote on something.

So that is the timeline I'd like to be working with on this.

And I do want to, I have a couple of questions just on this point.

One understanding, so I have a question for Shanti, understanding that Sounds like we'd love more shanties.

And that's one piece of this.

But you also highlighted that there are just a number of structural matters.

And it was something that really came out to me in what you shared was the matter that we have codes that are in conflict with one another.

and that feels like something on the governmental level we can be remedying and so I'm wondering how if I imagine you probably have a list of areas of conflict where we see codes and so I'm wondering if there's something like that that exists either from you or from OED and how we're tracking that work because I mean there's a number of things that may be out of our control but the matters of trying to address and work on a government to government level to address the code conflicts feels like something that could be solvable.

Yeah.

I mean, I think to say they're in conflict, it's more like they don't cohere, I guess is what I would say, right?

There's sort of these overlapping layers of regulation that aren't connected for people, necessarily.

The special review districts, in particular, they have their own, and they're all different across the city.

Every single one is different.

They have different rules, different processes, their own special part of the land use code, and then there's also the land use code that's the zoning part that also applies and that SDCI administers.

I'm just going to put this out here because you've asked.

In my opinion, that portion of the Department of Neighborhoods that is under the Preservation Office should be part of SDCI because it is a regulatory body.

And I think that would go a long ways in terms of the issues with the special review districts to getting more coherence and staff that are simply talking to each other and taking responsibility for shepherding through applications that have to go through multiple layers of review and approval.

That's one I throw out there.

But I also know that OED, like in terms of the other issues with, you know, SDCI codes, there have been a few different things that have been advanced, I think, that Philip Sitt was working on.

That's right, yeah.

Last year we were really excited to partner with SDCI on, updates to the substantial alterations legislation, which I think has significantly exempted smaller commercial spaces from some pretty onerous requirements.

And like Shanti mentioned, I think we are always on the lookout and probably do have a mental list of what else do we want to clean up here.

and on SDCI, I do just wanna give a shout out to our partner, Peter Furbinger there, who for anybody watching this hearing who is planning on starting a small business, I mean, Peter is such an excellent resource at the beginning.

I do think one of the things that Shanti noted is like the permitting thicket gets very, very thick, very fast.

And so I do think that kind of like front end consultation tends to help a lot, but Peter has just been such a great resource to OED and the small businesses that we work with and kind of helping them navigate.

But just like we need more Shanties, I think, not every type of business has access to Peter at exactly the right time and also it's just one person.

And so I think this larger systems point is very well taken and something I'd say OED is extremely supportive of.

If I could just add really quickly, as you're looking at this code issue, one thing I want to highlight is that oftentimes I've seen many, many businesses work with different city departments to get everything online in terms of coding and they think they have everything ready to go and then they will hear back from FHIR or SDCI or another department and be told, you are actually not up to code because of X, Y, Z, even though they were told by that same institution previously that they were.

And oftentimes this adds to the cost of doing those build outs, making those changes, and also the wait time that it takes to start those businesses.

So I would just advise to pay close attention to that as well.

I don't know if it's an interdepartmental communication thing, but just something to note as well.

Madam Chair, may I ask a question real quick?

I apologize.

Oh, please do.

Councilmember Ars, you're recognized.

Thank you, Madam Chair.

I just want to go back to Shanti for a minute and I couldn't write it down quick enough and blame that on me and technology and age.

You said you were just gonna say it and I missed what you said.

You said SDCI that you who should be part of what SDCI should OED or Dawn?

What I said was that the Preservation the Office of Preservation which is within the Department of Neighborhoods but is actually a regulatory body in the I think a majority of what it does, which is the special review districts across the city, you have to get approvals from them.

You have to get certificates of approval from them in order to proceed with further permitting from SDCI, and they have their own sections in the land use code.

They have their own processes.

They are a regulatory body, and they should be situated with the rest of the regulatory bodies, the physical space regulatory bodies in the Department of Construction and Inspections.

Madam Chair, may I have a follow-up question?

Please.

Thank you.

So, and you may already have this, and I think we did this a few years ago, but I know what we know from the city side But Shanti, just because you do this and you've had glowing reviews from Nikita and folks, have you ever thought of or have you submitted or would you think about giving us just your perspective like a flowchart from like from beginning to the challenges in the city, the alphabet city that small businesses have to go through for permitting SDCI, DON, Office of Preservation, even if it's just really clunky, just so we can, for me, I'm a visual learner, just so I can visually see.

I kind of know, but I don't think we've ever put pen to paper and had someone on the private sector side, like a consultant like you, I mean, we have our city departments that come and their staff and they're, you know, we get those slide decks, but I don't think I've ever seen anything from the private sector of a consultant like you to come in and say, hey, this is where the challenges are, this is where things don't move as smoothly as we would like, or this is where things are repetitive or duplicative, you know, we're doing the same stuff over and over, kind of where the bottlenecks are, if you will.

I think that would be an incredibly helpful, the flowchart itself, but also the exercise of doing that and having multiple city departments and elected leaders familiar with that a little bit, at least some of it.

It would be very hard to put that all into one chart.

And I definitely don't have the expertise to do that myself.

That would be multiple people that would need to help with doing something like that.

Yeah and I think there's bits and pieces of it and so with that broader kind of commercial space consulting team there probably is within that and then partners within the city to be able to do that at least as a starting point to understand what the steps are that folks have to go through and kind of what those key decision points because a lot of times folks are just doing their job implementing the code and it's just that it doesn't always talk to each other.

And so being able to sort of lay that out holistically could be an interesting project.

And I think, you know, with some of the partners that we've been working with through that commercial space consulting and our pre-lease program could be an interesting place to start who have been kind of dealing with it at a practical level.

So we'll definitely kind of take that.

And I know there's been a lot of internal work on permitting as well.

The other thing I was gonna mention too, one thing Alicia mentioned Peter, one thing like Jen and the rest of our team have been thinking about too is how to get folks information around the permitted use of their space before we even think of changing it or doing that, but doing that before you sign a lease.

so that you can really understand a lot of times it's just not knowing so that you don't make the best choice for your business.

And so just that being able to look up the permitted use just as kind of one immediate thing that we're working on as we go through this work.

And I'll just tag on a note.

We recently held a stakeholder meeting and I think that this finding out the permitted use, I mean, this is something that is challenging all around, we heard from both like property owners, as well as those who are working with businesses.

And so I think to your point, Madam Chair, that how are we looking at things in the city and just making it easier to find this information when we can, because sort of like no matter who it's landing on, it's challenging to find, I think is what we heard.

Councilmember Juarez, I really appreciate that point and that call and the request for around a flowchart.

I think I would appreciate that as well and would love to follow up on potentially this activity with our panelist partners and OED.

Do you have any additional follow-up Fabulous.

Well, I mentioned earlier that it would be great if we'd have more shanties, but I think we all agree that in this work, the goal is that we have more Nikitas and more Jaishins in this work as well.

And so I do have some questions for each of you, understanding you're representing separate industries.

Jaishin, I'm wondering if you can speak to some of the specifics just around food-related businesses with brick and mortar and the challenges that come with that.

and then I'd love to turn to you, Nikita, to talk a little bit about some of the biggest obstacles facing clothing retailers.

Yeah, I think as a restaurant, the challenge is everything is the prices go up, the inflation, the rent, labor, supplies, ingredient, and because there's more vacancy in downtown, so our lunch business is being dropped.

So if I can help more business go into the space, I think can bring more people come to the downtown area, right?

So right now they have, right now I feel like people like to go to the event, right?

They go to the event, they go summertime, they love to go to the event.

But Seattle rains a lot.

If a lot of big places, they can, the vacancy place, they can change into like indoor market, something like that.

They have food, they have music, they have some tea.

For like bring people, like try to bring more people traffic Full traffic, I think that's the most important.

And also as a small business, they said a lot of permitting, right?

It's maybe the consulting, they can add one more program is called like coordinator.

Like you have to idea like a timeframe, all this.

And then maybe they can go more smoothly.

They can open the door more quickly.

Yeah, yeah.

Thank you so much for that.

Oh, one more thing I wanna mention is because also downtown area, I think maybe security is another issue for like business and for traffic, right?

That's the thing to keep people coming and their business, because they have a lot of breaking window, that kind of stuff.

So for example, like a plaza, our plaza, they want to hire some security, it's like they need to add more fee.

But without that, it's hard to do as well, yeah.

Really appreciate that response and those points.

And I was going to move next to Nikita, but I think she stepped away for a moment, so I will just pivot to maybe a closing question.

Maybe we can circle back to Nikita when she hopefully comes back.

Maybe just a closing question for now, but also colleagues, if you have additional questions, want to make sure we hear yours.

Just what is one thing you wish everyone who was looking to lease a space knew before they signed?

It sounds like there's a lot of things, but if you were to choose one thing, I would be curious what you would say.

Starting with Shanti.

I guess I'll go first.

There are many, many, many things, but one thing I'll highlight, because we've talked about some other things, and that is, Heidi alluded to this, what is the space currently certified for?

What is the certified occupancy for the space?

Because There's a fair amount of businesses, and I can give you an example, a salon that I worked with in Ballard through OED's program that purchased a salon that had been in operation for six years.

It had been in operation since prior to the current property ownership, signed a purchase and sale agreement, signed a lease, went to do some fairly minor improvements, cosmetic improvements, to expand the nail salon to also include a space to do facial work, and found out that when that salon went in and converted it from office to a salon, they did not go through a change of use process.

and change of use can be incredibly scary because you just have no idea how codes have changed, what new things are gonna apply, both the complexity of the permitting, which causes delay in opening, but also the cost of those improvements that you didn't anticipate can be very, very high.

And fortunately, in that particular case, we were able to call Peter Feuerbringer, who is invaluable, and he helped usher it through.

So there was delay, but only two months.

It could have been much worse.

So that is one thing that I would really just wish that when people sign leases, they knew the space that was being represented to them as being viable for their use actually was.

And I think this is something, there's been some mention of this commercial tenant transparency legislation that OED is working on, and that is one of the things that that could help address.

getting the certificate of occupancy out there.

Excellent.

Thank you.

Shanti hit the nail on the head.

That was what I was going to talk about.

But another piece I want to highlight as well is insurance.

Will you be able to receive insurance for the type of business you are opening in that location?

There are some places, like I mentioned earlier, in the city in which you cannot get insured.

or the number of insurance options are very low, which means the cost of insurance is very high.

And also in looking into that, what does it look like when you do file a claim with your insurance?

Because oftentimes if you, we've seen businesses that have that will experience a break in three days in a row, and they will not tell their insurance out of fear that their premiums will increase.

And so they'll pay for the loss of profit, or the product, and all of the broken windows, et cetera, out of pocket.

with help from OED Storefront Repair Fund as well, but that's still an out-of-pocket investment.

And then they'll not bring that back to insurance because the increased rates will supersede the large amount of money that they already have to spend on rebuilding after those issues.

So really investigating that landscape ahead of time and being prepared to understand that dynamic.

Yeah, and I also think the small business, when they sign the lease, they need to know what's possible TripleNet can because sometimes it's an elevator repair, parking lot painting, remove the graffiti.

Even right now, this year, you don't have to consider this fee, but sometimes you need to consider after five years and six years, what's the possible fee can be in that group, and then you can be prepared.

I would say number one piece of advice is don't rush into signing a lease.

It can take a year to properly vet a space and see what options are out there and get something that really fits with your business.

So take your time.

It's 100% worth it.

And it affects the next 10, 20 years of your business.

I was going to say similar.

I think just knowing the questions to ask before you sign the lease and knowing to reach out.

We want to talk to people before they sign that lease.

And so we're constantly working with our business district partners, our neighborhood partners, our consultants, our small businesses who are networked with other small businesses to know that there are some resources and supports and just being able to ask some of these critical questions before that lease is signed and really think about like, is this the best space where I can grow and thrive with my business?

I know one thing that Shanti mentioned in her comments earlier, which is like, does my business plan as a small business work for the space that I am thinking of?

And just really kind of having that honest look before, as everyone else noted before you were signing that lease.

Thank you.

And I did see Nikita for a moment.

Nikita, I know we had a question that came up for you.

I don't know if you're still with us.

A question for you if you wanted to speak to anything specific facing clothing retailers or anything you wish folks would know before they signed a lease.

So just an additional call in case you're still with us.

Right.

Well, at this point and seeing no further questions from committee members, I'm going to thank each of our panelists for coming and speaking with candor and clarity and sharing about the challenges that are happening right now.

It is my intent as committee chair that we keep up this work and I want to give a huge thank you to OED for talking about and also doing this work on commercial tenant transparency and working on a piece of legislation to be able to address some of the issues that are raised today.

But I think what is very clear is that there were a lot of issues raised today that need our attention as a council to be able to remedy.

And so in many ways, I'm viewing this as the start of a larger body of work to address these challenges.

And so I imagine there will be follow-ups to each of our panelists for today as we continue this work.

But I want to thank you again for taking time this Friday morning to share this and excited to be moving in partnership with you all.

I hope everyone has a great weekend.

Thank you again for being here.

All right, colleagues, we have reached the end of our agenda for today.

Are there any questions or things for the good of the order?

No?

Fabulous.

Okay, I will release folks into their weekend.

So the next Human Services Labor and Economic Development Committee meeting is scheduled for Friday, August 7th at 9.30 a.m.

Hearing no further business, we are adjourned.

Take care, everyone.