The North Bend City Council voted 5–2 May 20 to authorize a development agreement with PJO Northwest Development LLC for the Mountain View project, a mixed-use proposal to build about 9,500 square feet of commercial frontage and up to 56 townhome units on a just-over-4-acre parcel east of downtown.

Planning staff summarized the proposal: the site is zoned Neighborhood Mixed Use (NMU), the parcel is roughly 400 feet deep, and the proposal would place retail along North Bend Way with residential behind it. Staff said the agreement requires the commercial construction to begin before the second half of residential permits are issued to encourage delivery of the commercial frontage. The proposed development is within the city’s tax increment finance zone and staff estimated impact fees at approximately $3,100,000.

Developer Phil O’Sullivan said the project followed the NMU zone’s intent except for a horizontal mix of uses rather than the code’s usual vertical arrangement. “We’ve been receptive to your feedback, incorporated your changes resulting in the proposal before you here tonight,” O’Sullivan said, noting planning commission and committee reviews and unanimous recommendations earlier in the process.

Council debate focused on whether the development agreement effectively changed the city’s adopted comprehensive plan and whether the residential units would meet the council’s goals for lower-cost middle housing. Council member Elwood said he would not support the agreement, citing concerns that moving commercial away from stacked (vertical) mixed use could make homes less affordable; other council members argued the project would add middle-housing supply and generate revenue for long-term city needs.

Council member Chris (as recorded) asked that staff prepare code changes to the NMU performance standards so future applicants would not need one-off development agreements to achieve similar outcomes.

The motion to approve AB 25-048, authorizing the mayor to execute the development agreement with PJO Northwest Development LLC, was made and seconded on the record. The motion carried 5–2; the meeting record shows the nays were recorded as Bridal and Allen. Council members in favor cited projected tax revenue, impact fee estimates, project trail connections and Complete Streets frontage improvements; dissenting members cited concerns about long-term land-use outcomes and preserving commercial capacity downtown.

Staff and the developer said the project would provide two trail connections to the north that could link to the Snoqualmie Valley Trail if adjoining properties redevelop. The packet included comparative revenue projections and a city staff estimate that generating between 35 and 40 jobs in the commercial frontage would make service costs neutral, though the developer said job creation depends on final tenants.