LAKE STEVENS — The city will soon cash in on the arrival of Costco. For longtime City Council member Marcus Tageant that payday was in June.
Costco is aiming to open a big new store in the city next fall. Lake Stevens expects to bring in a boatload of sales tax revenue each year.
One of the last pieces of the puzzle fell into place in June, when Costco purchased two properties from the city and several adjacent properties from the Nordin family. Collectively, the properties sold for about $8 million, according to records from the Snohomish County Assessor’s Office.
The broker for the family?
Councilmember Tageant.
As the owner of Task Properties, Tageant was set to make a 2.5% commission on the sale, according to a 2014 Commercial Brokers Association listing shared with The Daily Herald. The Nordin family’s properties sold for about $4.2 million — which works out to just over $100,000 for Tageant.
He wouldn’t confirm or deny that commission but said in an interview last week that the sale was “one of my probably top 10.”
Can a council member profit from a development deal that hinges on council decisions?
Sure, but with caveats.
Washington State law recognizes “council members are real people with real jobs,” said Candice Bock, director of government relations at the Association of Washington Cities. “You have small towns, and the local business owners are the ones who run for council.”
But they can’t vote on city decisions when they have a personal stake.
And they need to state their conflict of interest, which “must be recorded in the official minutes of the city council,” according to the Association of Washington Cities Small City Resource Manual.
When votes related to Costco came up, “Marcus always recused himself,” Mayor Brett Gailey said. If the development agreement was on the council’s agenda, he often walked out of the room.
“I left the room so I wouldn’t accidentally give an expression or look if there was a vote,” Tageant said.
He would neither confirm nor deny his role in the Costco sale because of non-disclosure agreements, he told the Herald in 2019.
“I think the word got on the street,” he said in the interview Thursday. “I just couldn’t have a conversation about it.”
Public records now hint at how much Tageant may have profited from the sale.
The council member sold the Nordin family’s properties at 2402 S Lake Stevens Road for about $4.2 million, according to records of the Snohomish County Assessor’s Office.
The city of Lake Stevens sold the two neighboring properties to Costco for about $3.8 million through a direct sale, according to Russ Wright, community development director for the city.
Tageant was first elected to the City Council in 2009. He fell short in a race for mayor against John Spencer in 2015, and he narrowly won his seat again this year over Joseph Jensen. This year Tageant was re-elected by just 402 votes.
In the recent election, Tageant received about 90% of his campaign funds from those with a vested interest in local development.
Costco is planning to bring a 160,000-square-foot retail outlet, 30-pump gas station and more than 800 parking spots to the city’s “20th Street corridor,” which was zoned commercial in 2012. If Costco didn’t move in, another retailer could have.
In 2020, the average Costco location brought in almost $200 million in sales. In Lake Stevens, that could mean about $600,000 to spend in the city annually, said Barb Stevens, finance director.
It was a feat to bring the big box store to town.
“Costco has been going on for five years,” Gailey said last week.
The corporation first showed some interest in the property in 2017, Tageant said. And things moved swiftly for the first few years.
Tageant credited the former mayor, John Spencer, for enticing Costco to the site. Initially, Costco was turned off by limited road access.
In 2017, the city contracted The Watershed Company to conduct a wetland report to determine the feasibility of extending 24th Street SE to access the property. The city also fronted the roughly $3.4 million for the extension of 91st Avenue SE and related utility changes.
Spencer publicly confirmed Costco’s interest in 2018, and by early 2019, the store applied for its first permits.
Over 100 Lake Stevens residents showed up to early meetings about the proposed warehouse, where one person called it “the biggest political issue of the year” in 2019.
And in 2020, Livable Lake Stevens, a neighborhood coalition opposing the Costco, filed a Land Use Petition Act lawsuit, alleging the city tried to steamroll the project. It was dismissed by a Snohomish County Superior Court judge.
Early this year, Costco got the required city permits and U.S. Army Corps of Engineers approval to fill wetlands on the site and begin construction.
In June, the Lake Stevens City Council passed an agreement to sell the remaining parcels to Costco by a vote of 6-0, with Tageant abstaining. Ground broke later in the month, clearing the way for a massive warehouse in the middle of a neighborhood.
Though thousands of trees were cleared from the site, Costco isn’t out of the woods yet.
Livable Lake Stevens sued again, this time targeting the U.S. Army Corps of Engineers. They allege the corps violated the Clean Water Act by approving plans to fill roughly 1¾ acres of wetlands and damaging another 1.4 acres to make way for Costco.
Isabella Breda: 425-339-3192; isabella.breda@heraldnet.com. Twitter: @BredaIsabella.
This article has been updated to correctly reflect the city’s projected sales tax revenue.
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