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Council approves $26.57M bond package to fund Yelm Highway park and Armory arts center renovations
Summary
The council authorized a 30-year debt issuance estimated at $26.57 million to fully fund Yelm Highway Community Park Phase 1 and Armory Arts Center Phase 1 renovations; the package relies primarily on parks-dedicated revenue and a proposed 20-year extension of a half-percent nonvoted utility tax contributing about $270,000 annually to parks.
The Olympia City Council voted to authorize issuance of 30-year debt with estimated proceeds of $26,570,000 to finance two legacy parks and arts projects: Phase 1 construction at Yelm Highway Community Park and Phase 1 renovations of the Armory Arts Center.
Interim Parks, Arts and Recreation Director Silvana Niehauser presented the package and described the projects as "community backed, grant leveraged, and shovel ready." She said the combined first-phase cost for Yelm Highway Community Park (phase 1) and Armory renovations is roughly $46 million; staff plan to debt-finance about $26.6 million and use secured grants and prior investments to cover the remainder.
Phase 1 at Yelm Highway is described as a roughly $27 million project that would provide a full-size synthetic lit soccer field, playground, 13 pickleball courts (one ADA-accessible), two full-size basketball courts, a community plaza, support amenities, EV and bicycle parking and restoration/landscape work. The city reported about $3.85 million in grant funding secured for Yelm Highway and roughly $14 million invested to date in acquisition and site work.
The Armory phase 1 renovation was presented as an $18.9–$19.0 million project to bring the 1938 building up to code, add seismic and accessibility upgrades, install HVAC improvements including fresh-air intake, abate lead and asbestos, replace the roof (with solar and battery-storage plans), and provide fire suppression and new electrical service. Staff said the city has secured about $2.5 million in grants and invested roughly $1.2 million to date on the Armory project.
The finance plan approved by the council would rely primarily on parks-dedicated revenues: approximately $700,000 per year of voted utility tax dedicated to parks, about $750,000 per year from the Olympia Metropolitan Park District (MPD), and about $270,000 per year from a proposed extension of a 0.5% nonvoted utility tax that currently is set to expire in 2029. Staff said the full amount of the nonvoted utility tax is about $525,000 per year and the proposal before council would retain roughly $270,000 of that for parks through a 20-year extension to 2049.
Under the adopted motion staff estimated an annual debt payment of roughly $1,720,000. Council discussed alternatives — including a smaller 20-year bond that would have required additional scope reductions or use of fund balance — and directed staff to proceed with the 30-year package that preserves the projects’ scopes and funds planned solar installations on the Armory roof. The motion approved the staff recommendation to issue the debt, extend the use of a portion of the nonvoted utility tax to 2049, and fund the projects as proposed.
Council members voiced support for advancing two long-standing community projects despite current budget constraints. Council member Gilman, who moved the motion, called the projects "legacy" investments and urged a long-term view. The council adopted the motion by voice vote.
If the city moves forward on the timeline presented, staff said the bond rating would occur in August, sale in September and construction contracts to follow, with Yelm Highway construction expected to begin in early 2026 and openings planned in 2027. Staff noted the package will slow the pace of other capital work but said impact fees and grant match will continue to support other parks investments.
