SeaTac Sued for ‘Intentionally’ Interfering with an International Boulevard Project

by Jack Mayne

The City of SeaTac has been sued for using illegal and improper processes to wrest control of property near the airport Sound Transit terminal.

The suit was filed on Dec. 21, 2012 by K&S Developments, which is headquartered on Harbor Avenue in West Seattle, and controlled by Gerald S. Kingen. Kingen also owns Salty’s on Alki and Salty’s on Redondo Beach.

The lawsuit says K&S borrowed money to buy property at 15247 International Boulevard in SeaTac for retail stores and a park and fly operation. The suit claims that SeaTac city officials stalled the K&S request for permits to develop the site, across International Boulevard from the airport Sound Transit terminal, eventually using “improper actions” to take over as owner of the land and buildings.

K&S maintains it had been in conversations with the city for permits when the city, in February 2005, “adopted a moratorium on park and fly construction designed to intentionally frustrate, delay and interfere” with its plans.

The suit then says the city “adopted interim regulations also designed to intentionally frustrate, delay and interfere with K&S’s planned development.”

K&S maintains it did not know then that the city was engaged in “unlawful conduct” that SeaTac was fully aware that the delays and negotiating techniques were straining financially the developers. Then, four years latter, the city suggested to K&S that it would allow a mixed-use residential development on the property, but included terms in the development agreement that the city knew to be “unreasonable and unenforceable.”

SeaTac, the suit maintains, used its regulatory powers “to intentionally frustrate, delay and interfere with K&S’s planned development and interfered with K&S’s business relationships with third parties for unlawful purposes” so that it could protect the city’s “own business and proprietary interests” and that it schemed to acquire the property “at less than fair market value.”

The lawsuit says that was done when the city hired the Colliers real estate company “as an undisclosed principal” to buy the property, and that Colliers pressured those who had lent money to K&S to threaten to foreclose on the developer. K&S says it was finally forced by financial strains to sell its promissory notes. Colliers then sold the property to the city for the value of the loans.

“By purchasing the promissory notes, the city acquired the property for millions of dollars less than the fair market value,” the K&S suit claims. The city got the property on Dec. 31, 2009.

For all of this, K&S‘s law firm, Ashbaugh Beal of Seattle, is seeking unspecified damages from a court trial or, most likely, a negotiated settlement.

Besides the City of SeaTac the suit lists as defendants Stephen Butler, former planning director; Jeffrey Robinson, economic development director; Craig Ward, former city manager; Todd Cutts, city manager; and Colliers International, the commercial real estate company.


4 Responses to “SeaTac Sued for ‘Intentionally’ Interfering with an International Boulevard Project”
  1. Earl Gipson says:

    In viewing the accruing data on the City of SeaTac one must wonder what the heck is going on at City Hall.

    Let’s review. In 2009 the City schemes to take the Park N’ Fly at 176th and IB by condemnation (without telling them) all the while negotiating a Development Agreement with the owners for their own private project. That attempt failed but not without considerable cost to the owners which they cannot recover. Now we see that in another alleged scheme (to be proven in court, of course), that seems to have been hatched during that same period, the City of SeaTac wants another property and makes a mess of the Development Agreement. This time they were successful and are now being sued. To add insult to injury the City stiffs the Real Estate agent and the County by not paying excise tax on the sale or the commission. The agent sued and now that court case is in appeal. The County, I believe, still wants their money, too.

    These alleged schemes all involved our City Managers and the Planning Department and I’m sure some Council members where aware (or even the drivers). In the meantime we hire a new and much ballyhooed Planning Director and in re-organization becomes the Community and Economic Director. She is promptly fired and is also now suing the City also. Did she not go along with the schemes? In this same period we terminate a City Manager, Craig Ward, and promote another, Todd Cutts (formerly the assistant City Manager). Coincidentally (or not) they are both named in the lawsuit mentioned above.

    We also had an historical election in the City of SeaTac in 2011. This is where the election was bought by certain special interests groups in favor of 3 Council candidates, outspending their rivals almost 7 to 1 and setting a record for election spending in our City exceeding all elections in total since the City’s incorporation.

    Just recently it was discovered City Manager Cutts gave a single employee a $17,000 per year raise and a bunch of vacation (this, by the way, does not include the additional cost of benefits associated with this increase, which would approximate an extra $5,000)All conveniently legal since the Council changed the law in mid 2009.

    These are just a few foibles that have come to the public eye and its makes you wonder what we are NOT seeing. No one need question why there are so many PRR’s (Public Record Requests) nor that certain Council members would like those curtailed.

    This brings some observations to mind. We either have some very ethically challenged City Staffers/Council members, incompetence is an employment requirement, and/or there is a plot afoot and we SeaTac Citizens know not the end game.

    In summary I do know some things. My repeated calls for a City wide Code of Ethics goes unheeded. That is now understandable. I also see why Public input is not allowed during consolidated Study Sessions after Council Committees were eliminated (it was allowed then). Public input was also eliminated during Council Meetings for Action Items/Unfinished Business/New Business (all where it counts). To this we must thank un-elected Mayor Tony Anderson, avid cohort Deputy Mayor Gregerson, Council members Bush and Ladenburg. Council members Forschler, Fernald, and Terry Anderson were opposed to cutting out the Public in these crucial meetings or parts thereof.

    The old saying “you can’t fight City Hall” must have been written by some former sociopathic City Staffers. They have most of the cards, our endless tax dollars, are insured for their screw-ups and most of us Citizens do not have the resources to fight them when necessary. Thank goodness for those who do or we would never know the extent of what apparently has been going on in our City for possibly years.

    Aka The Cactus

  2. Inside Outsider says:

    Ethics should not have to be dictated … it’s a personal code of conduct that we should all learn as we mature in any society. Those who don’t acquire this trait are often termed “sociopaths” by professionals who study this sort of thing. These folks have no “social conscience” and their decisions are based on what reward the various choices will provide for them as individuals.

    Unfortunately, obviously SeaTac desperately needs a mandatory and binding ethics clause for their existing and future employees. Decisions should be legal AND ethical.

  3. Insane =

    in a state of mind that prevents normal perception, behavior, or social interaction; seriously mentally ill.

    (of an action or quality) characterized or caused by madness.

    in a state of extreme annoyance or distraction.

    (of an action or policy) extremely foolish; irrational or illogical.

    This seems to be the same old story with SeaTac City government leaders and the elected leaders who reside on Angle Lake City Council, Tony Anderson, Mia Gregerson, Dave Bush and Barry Ladenburg.

    The citizens of SeaTac have been duped or sleeping in a coma during the 2009 and 2011 elections to vote the four people mentioned above. Its time to wake up for 2013 city council elections as the un elected mayor Tony Anderson is up for another term. Do you really want this guy in charge? His past is so checkered the uniform worn looks like the Pittsburgh Steelers throw back in time jersey and pants. I don’t want him elected again and would run if time permitted. The citizens need to be aware of his past and vote him out office to save the city from moral and financial evaporation.

    You be the judge citizens of SeaTac. Its time to Take SeaTac Back and stop SeaTac Cover Up. Do you really want insanity to continue?

  4. Outsider Looking In says:

    Looking deeper into the issue stated above regarding City Manager Todd Cutts giving a single employee a $17,000 annual increase plus a bunch of vacation, I discovered the employee who received the increase and the 135 hours of vacation (plus an increase in the monthly vacation earned which is supposed to be based on years of service) was the Human Resources Director. Additionally, it appears that this was not approved by the City Council, only by the City Manager and the HR Director herself.

    Is this the new standard practice/policy of the City to hand out blocks of vacation time and large pay increases to all employees? Are other employees also entitled to these benefits? Publicly traded companies hand out stock options, are cities now handing out vacation days in lieu of stock options?

    Although no code of ethics exists at the City of SeaTac, all citizens need to come together to challenge the personal code of ethics for these two individuals and request that the vacation be returned/repaid back to the City/citizens along with the excessive portion of the salary increase.