It appears that the city will likely build an access road for a U-Haul facility on the north end of town next year.

During a Tuesday Oak Harbor City Council meeting, however, several council members made it clear that they want the company to pay some portion of the cost.

“I would really like to see us negotiate to have a cost-sharing process,” Councilman Bryan Stucky said.

Councilmember Jim Woessner suggested that the developer pay any costs above the $481,500 estimate in the city’s capital facilities plan. The current estimate for the short section of road has risen to more than $700,000.

The proposed small section of a road off Fakkema Road, which would provide access to the business fronting Highway 20, sparked controversy last week when questions were raised about why the city would pay for the road. Normally, developers pay for such infrastructure.

Critics were especially irked because U-Haul and its parent company are multi-billion-dollar corporations that should be able to pay for their own infrastructure.

Tuesday, staff members made a series of arguments in support of city financing of the project.

Development Services Director David Kuhl explained that the road was envisioned as an economic development tool to encourage development on a highly visible but challenging piece of land. The state Department of Transportation warned that access wouldn’t be allowed to the development from Highway 20 because of safety issues; people drive fast and the sight distance is limited in the area.

Kuhl said the Fakkema access road was first identified in 2016 as an economic development project. Three developers expressed interest in 2016-18, but the projects didn’t move forward because the access complications made the cost too high.

The access road was originally placed on the city’s capital facility plan as being funded by a grant from Island County’s rural county economic development fund, also knows as 0.09 funds.

Several county officials have said that city officials were repeatedly told in 2016 and 2017 that the county would not help fund the project because it was expensive and would benefit few businesses.

Nevertheless, the city applied for the grant in 2019; it was unanimously rejected, with county staff and commissioners pointing out that the companies that would benefit were contributing nothing to its construction. Also, the city’s own application states the project would only create two jobs in its first three years.

In response, city officials in 2019 decided to use the city’s transportation impact funds to pay for the road. U-Haul submitted a development application that year.

While the city’s application to the county stated the road would cost $504,000, it was placed in the city’s capital facility plan in 2020 at a cost of $481,500. The city council approved the plan.

A city engineer told the council last week, however, that the latest estimates place the cost at $700,000.

Interim City Attorney Hillary J. Evans warned the council against pulling the plug on the road project. While she acknowledged that the city never made any promises to the developer per se, U-Haul did move forward with the project after the city made public its plans to build the road.

“They could very likely file a lawsuit against the city,” she said.

Yet both Councilmember Erica Wasinger and Mayor Pro Tem Beth Munns pointed out that the council hasn’t taken a final vote on building the road. The project was merely placed on the capital facilities plan, which is a necessary step in order to obtain grants for projects. It’s common for projects to be delayed or even canceled if grants fall through, costs change or priorities evolve.

“Just because it’s on the CIP doesn’t mean it always gets done,” Munns said.

Kuhl said the new road could become part of a future north-south circulation route that may serve as an alternative to the highway. Woessner, however, pointed out that it would lead to Case Road, a private road, and directing traffic onto it may force the city to complete upgrades on that road at an even greater cost.

In addition, Kuhl pointed out that the road would provide access to city-owned property adjacent to the U-Haul property.

Yet it’s unclear whether the city needs access to its property or even if the road would provide access at all. City staff said a ditch would divide the road from the city property in order to prevent drivers from running over the city’s Garry oak trees.

In a deal that involved three levels of government, the city purchased the Boyer property in 2006 to prevent development on commercial property within the “accident potential zone” off the end of a Navy runway. While it’s now considered a city park, city officials said at the time that neither public access nor public parking was planned.

While Woessner said he would like U-Haul to pay a portion of the road cost, he also cautioned officials against creating a reputation that the city doesn’t follow through on its obligations.

The city council will likely be asked to award the project to a construction firm, or reject it altogether, in March or April, Kuhl said.