City Council Rejects Potala Village Settlement in Victory for Neighbors

The Kirkland City Council Tuesday rejected a city staff recommendation to settle a lawsuit by the developer of the proposed Potala Village apartments that would limit the project to 100 units, instead agreeing in a dramatic split vote to consider a proposal by neighbors fighting the development to limit it to 58 units.

The 5-2 vote, immediately followed by a break in the council’s meeting, left neighbors jubilant. The developer and operator of the company that would build the project left abruptly.

“That was tough,” City Manager Kurt Triplett muttered as he walked over to greet neighbors during the break.

The project, proposed as a 143-unit complex along the Lake Washington shoreline in a neighborhood largely of expensive homes and condominiums, has become Kirkland’s hottest development controversy in years. Neighbors say that level of residential density would be out of character with the neighborhood along Kirkland’s signature lakeshore arterial, would lower surrounding property values and worsen already bad traffic on Lake Street/Lake Washington Boulevard.

Before the council was a proposed settlement of a suit by developer Lobsang Dargey, a Tibetan native and principal of Dargey Enterprises, that challenged a city council moratorium on development in areas zoned “BN” (neighborhood business), including the Potala Village site. The council had enacted the moratorium in response to neighbor’s protests last November, and extended it three times. The settlement would have limited the development to no more than 100 units and also called for several design changes, in exchange for a lifting of the moratorium and an agreement by the city to exempt the project from any subsequent changes in density allowed in BN zones.

During the open testimony portion of the council meeting, three residents, all neighbors of the project site, said their group STOP Potala had agreed to accept a plan that would allow 48 units per acre on the 1.3 acre site -- previously they had insisted on no more than 12 per acre. Dargey and the operator of the construction company, on the the hand, both pleaded with the council to accept the settlement.

“I have nothing left, to be honest with you,” Dargey said, noting that he had met repeatedly with neighbors, had negotiated the settlement plan, met in mediation with all parties, and had agreed to many design and plan changes.

“I try to please everyone. All of us, we met. I think this project will  bring a lot of value (to the neighborhood) with no negative energy. I encourage you to think really hard and support this 100-unit agreement.”

Dargey also implied the lawsuit would move forward if the council rejected the settlement.

Added Justin Stewart, the construction company owner: “We’ve obviously been working in good faith for a long time to come to an agreement that avoids litigation. The property owner’s rights are being thrown out the window if we do anything else. All (Dargey) is trying to do is build something within the letter of the law.”

Neighbors said it was only through “soul searching” that they could agree to a project allowing a development of 48 units per acre. “We ask you to do two things,” said Tom Grimm, who lives across Lake Street from the site and has testified many times before the council. “Reject the settlement and vote to adopt a zoning ordinance of 48 units per acre.”

Neigbbor Jack Arndt said a development of the size proposed would result in a 15 percent drop in surrounding property values and called a 48-unit per acre limit a fair compromise. “Anything more is a win for the developer and a loss for the community,” he said.

When the settlement came before the council, there was virtually no discussion of it and no council member moved to consider it. But when Deputy Mayor Doreen Marchione moved that the council consider the 48-unit per acre limit at the council’s Dec. 11 meeting, an intense discussion began.

“We’ve just been recently been down this road,” said Councilman Dave Asher, noting a long-running related discussion on limiting density in BN zones  -- currently there is no limit. “If we’re considering changing the number of units based on three people testifying tonight, let’s go back and have more hearings. It seems the process is really being short-circuited.”

Councilman Bob Sternoff expressed similar sentiments. “I’m not interested in going down this road again.”

But Council members Amy Walen, Penny Sweet and Marchione all favored the motion. Mayor Joan McBride said she alone appeared to favor the lawsuit settlement, but could accept a limit of 48 units per acre.

Said Walen: “The community has come to us and recommended a compromise on density. I would urge we honor that request.”

Added Sweet: “”I believe it is extraordinary the neighbors have gone  from supporting 12 units to 48.”

Councilman Toby Nixon said he preferred the city Planning Commission’s recommendation of 36-unit per acre limit, calling 48 “more of a stretch” in meeting the Comprehensive Plan’s definition of neighborhood business zones.

But Nixon did vote to approve Marchione’s motion, with only Asher and Sternoff voting no. As the council took its break, neighbors smiled, shook hands and chatted. Dargey and Stewart stood up and left the council chambers abruptly.

For several previous Kirkland Patch stories and other posts on the Potala Village project and ensuing controversy, click here.