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The developer has pushed back on air quality site conditions tied to a state Ecology part of the project's permitting and awaits a hearing later this year with the Pollution Control Hearings Board .
Funding for the project has arrived in the form of a $150 million mezzanine loan announced March 18 from Investment funds managed by Los Angeles -based Mesa West Capital and Morgan Stanley Real Estate Investing of New York . Mezzanine financing, which combines debt and equity financing, gives the lender the ability to convert the debt to an equity interest in the company in case of payment default.
The project earlier this year received a $263 million first mortgage construction loan from Bank OZK of Little Rock, Arkansas .
The loans in total provide loan-to-cost financing of 65%, according to the March 18 announcement from Mesa West Capital . That would make the total projected construction cost $635.38 million .
The former BNSF Railway-owned property, 5024 S. Madison St. , was purchased in September 2021 by Bellevue -based Bridge Point Tacoma LLC , (part of Chicago -based Bridge Industrial ) for nearly $160 million . At the time, the developers expected to break ground at the 150-acre site in August 2022 , with completion slated for summer 2023.
Since then, legal battles, local opposition and proposed legislation inspired by the project's permitting have focused on environmental concerns, traffic, groundwater protection and more.
State Department of Ecology compiled its responses to public comments regarding the project's construction stormwater general permit, granted in December. In that compilation, the department offered a frank view of the city's State Environmental Policy Act (SEPA) decision of a Mitigated Determination of Non-Significance, stating it "did not address the concerns expressed by Ecology and other agencies."
"Ecology provided comment to the City during the SEPA process to express concerns related to air quality and environmental justice impacts from the proposed project," it stated. "... Based on the City's failure to condition the project to sufficiently mitigate the project's adverse air quality impacts, we are exercising substantive authority under SEPA to further condition the project."
"Additional concerns related to the (Mitigated Determination of Non-Signficance) should be directed to the City," it added.
City media representative Linda Robson told The News Tribune via email in response to questions that the city was "aware that the Department of Ecology used its SEPA authority to place additional conditions on its site permitting for Bridge Industrial .
"While the City's SEPA determination was appealed, upheld, and not appealed further, Ecology is within its authority as a permitting agency to apply mitigating conditions under SEPA. What those additional conditions are and how they might impact the final project is an issue for the project applicant and Ecology to decide."
Another entity also will weigh in as a result of those additional conditions.
The state's Pollution Control Hearings Board will hear an appeal filed in January by Bridge Point Tacoma LLC and Sierra Construction , who is working at the site. The case is scheduled for a November hearing, and focuses on air-quality conditions from Ecology's administrative order about the project.
Ecology, in its administrative order, noted among other things, "The communities surrounding the Project are on the Climate Commitment Act list of overburdened communities for fine particles and cumulative criteria air pollution, and rank 10 (out of 10) for health disparities, diesel exhaust, and proximity to heavy traffic roadways on the Washington Environmental Health Disparities Map. Accordingly, Ecology has determined that these communities face disproportionate impacts from air pollution."
Among the questions to be considered at the appeal hearing, according to the prehearing order, is whether Ecology's air-quality conditions "exceed Ecology's authority and jurisdiction," including whether the department "improperly makes findings, reaches conclusions, and imposes conditions that are inconsistent with the Determination of Non-Significance issued by the City of Tacoma for Bridge's industrial park development project... ."
Another question among those to be addressed is whether "Ecology's imposition of the Air Quality Conditions was improperly based in part on environmental justice considerations that are outside the scope of the State Environmental Policy Act (SEPA)?"
Colleen Keltz , communications manager for Ecology's Water Quality Program, told The News Tribune that ahead of the appeal hearing, "The permit is fully in effect — so they need to be meeting the permit and administrative order requirements ahead of the hearing."
Robson with the City also noted, " The Department of Ecology decision does not immediately impact the project or the preliminary site work that began this week."
Neither Bridge Point Industrial's Chicago office nor Matt Gladney , Bridge's senior vice president of development, responded to requests for comment from The News Tribune .
Since opening its Seattle -area office in 2018, Bridge has announced plans for multiple warehouse/distribution centers along or near the I-5 corridor. Sites have included Tacoma, Everett , SeaTac , Lakewood , Milton, Kent and Auburn .
At the end of 2021, Bridge said it had acquired land to develop more than 7 million square feet of Class A industrial buildings in the region.
The company and Gladney also didn't respond to questions about why Bridge's Puget Sound -area projects, including Tacoma, along with its office in the state, are no longer listed on its website.
'They haven't canceled'
A local environmental group noted the missing information about Washington sites and Bridge's Bellevue office in a blog post earlier this year.
"Evidently they realized the 'meaningful impact' they'll have in South Tacoma isn't going to be meeting the needs of the local community," read the Feb. 5 post on the Climate Alliance of the South Sound's page.
The alliance describes itself on its website as a "grass-root, working-class, community-lead organization that is entirely self funded. We work with nonprofits to secure grant funding to pay for our communal space."
The group held a rally March 14 in Bellevue , outside an office building where the group says Bridge still operates, to protest the Tacoma warehouse project.
Gemini Gnull is coordinating director for the alliance and said there are residents in the immediate vicinity of the warehouse project who are still unclear on what's going in at the site.
So the group offers handouts with information regarding potential health impacts, vehicle trips/truck traffic, aquifer information and a traffic map illustrating anticipated future truck routes designed by a Tacoma resident.
"We go door to door knocking at people's houses and letting them know about the mega-warehouse," Gnull said. "Awareness has definitely increased, but a lot of people still don't know about it."
"I can tell you, they haven't canceled the project," Gnull added.
At the time, the group was doing an initial canvass of the Manitou area "and then recanvassing the places that we've already canvassed," Gnull said. "There's a lot of people who are interested and maybe have thought like maybe it went away, or maybe they stopped it."
The Manitou area, west and slightly to the south of the warehouse parcels, was annexed by Tacoma late last year. The annexation takes effect April 1 , adding more than 400 residents to the city.
Tacoma Bridge Point 2MM, the South Tacoma site, calls for 2.5 million square feet of light industrial and warehouse space in four large buildings.
At the time of the Lakewood 90 warehouse announcement in late March 2021 , Justin Carlucci , partner for Bridge's Northwest Region , said in a statement, "The South Tacoma submarket specifically is ideal for major e-commerce players, blue chip companies, and other tenant types alike."
In addition to the South Tacoma site, there is also Bridge Point Tacoma 125, 10002 Steele St. S. , and Bridge Point Tacoma 210, 10811 34th Ave E.
Work and monitoring
The City of Tacoma's page about the development offered an update March 21 that stated, " Bridge Industrial received initial site development permits the first week of March 2024 . Construction work is visible now as crews perform early site work to do erosion control, delineate contaminated areas, set up protections for the wetlands, and secure the site."
Some residents are keeping a close eye, as copies of emails sent to local, state and federal officials received by The News Tribune have shown, complete with a photo this week of a dusty scene amid higher winds at the site that day.
Residents have reported seeing dust carried by the wind at the site and described incidents of construction equipment tracking soil outside the site without appropriate washing, among other issues.
While these issues may seem typical for any construction site, this is not a typical construction zone.
The location is a Superfund site from its former industrial days with BNSF Railway for rail-car manufacturing, repair and maintenance, as well as other industrial use.
As a Superfund location, the U.S. Environmental Protection Agency is involved in monitoring and oversight.
" EPA 's primary role in the development process will be to ensure the final cleanup for the Superfund site at the South Tacoma Field remains protective of human health and the environment," Rafi Ronquillo , community Involvement coordinator for EPA 's Region 10 , told The News Tribune via email in response to questions.
In 1999, " EPA completed the soil cleanup work ... and started long-term monitoring to ensure the cleanup remains protective of human health and the environment," he added. "For this specific Bridge Industrial project, EPA is currently receiving weekly reports on the construction progress and environmental monitoring from the developer."
According to Ronquillo, the agency reviews the reports "for both quality and consistency in data collection during the process."
Any potential threat from the site of soil toxins released into the air along with diesel pollution from the trucks remain top of mind for some residents.
Ronquillo told The News Tribune that its project managers "have physically inspected the site several times" this spring "and will continue to do regular on-site visits as construction continues."
William "Kit" Burns of Tacoma said he routinely drives over to watch the construction. He captured the image of blowing soil that was sent this week to the EPA by another resident.
"I'm a retired architect. And I like photography. And I like construction," he told The News Tribune this week. "I haven't seen that much actual dust other than that one day, and it was on a very windy day," he added.
According to the city's mitigated determination decision, "All contaminated soils will be consolidated and capped under an impermeable cover, which will be substantially more protective of human health and the environment than the current cap and containment system. The plan for the updated cap and containment system has been reviewed and approved by the EPA ."
Burns, whose name was among the list of respondents in the Ecology permit comments report, also recounted contamination concerns for the aquifer at the location and the impact on nearby wells with the future new expanse of impervious surface from the development.
He also was critical of the traffic study that were submitted in the project's review process. The criticism echoed those raised repeatedly in council meetings, a review hearing and in the appeal of the city's approval of the project, which project opponents lost in October.
By Burns' reading, "The language in the MDNS is so weak it's virtually unenforceable," he said.
Proposed changes for future projects
The warehouse project will be a neighbor to residents in state Rep. Sharlett Mena's district, which includes South Tacoma .
In January, Mena introduced House Bill 2070, known as the Cumulative Risk Burden (CURB) Pollution Act. It aims to help communities overburdened in terms of pollution in industrial areas. A House report on the bill describes it as, "Integrating environmental justice considerations into certain project decisions."
The bill received a hearing in January and was referred to Appropriations at the end of that month but, given the short session, did not make it to the finish line for passage.
"It made it a good way in the process. But it's something that we'll have to work on over the interim and bring back next year," she said.
Mena told The News Tribune in a recent phone interview that the legislation is "a long time coming."
Mena, who works at the state Department of Ecology , said her legislation would build on the state's HEAL (Healthy Environment for All) Act, and former Sen. Rosa Franklin's work on community health and environmental justice.
"What was missing was this sort of environmental justice analysis on permitting decisions," Mena told The News Tribune .
She described that the bill would mainly affect permits "in the clean air and clean water space" in communities already struggling with air or water pollution.
If a project such as a warehouse wanted to locate in such community, "then you would have to do an environmental justice analysis before you can move forward."
The review would come under the already established terms of the State Environmental Policy Act review process for developments, which examines environmental impacts.
The designated communities would be defined based on already-established data including the Department of Health's state Environmental Health Disparities Map. Those ranked seven or higher on the map would gain the extra layer of review.
Based on the qualifiers as defined by permitting in the proposal, a project like Bridge's South Tacoma development would face the extra layer of scrutiny had the regulation been in place.
But the proposed measure won't touch the South Tacoma project, already moving forward with pre-construction.
Asked if the South Tacoma project was the impetus for it, Mena responded, "I would say it was the latest example of why we need it."
Given all that's happened so far, Mena says she understands the frustration among residents.
"I feel like folks were screaming at the top of their lungs. And people just didn't really give them the time of day."
Story has been corrected in reference to former Sen. Rosa Franklin .
This story was originally published April 1, 2024 , 5:15 AM .
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