Public Development Authorities (PDAs)

Overview

Cities, towns, and counties may form public development authorities (PDAs), sometimes known as "public corporations," to assist in administering federal grants or local programs, enhance governmental efficiency and service provision, and/or improve a municipality’s general living conditions. These PDAs are special purpose quasi-municipal corporations that are primarily authorized under RCW 35.21.730-.759, which allows local governments to create or contract with "public corporations, commissions, or authorities."

Communities establish PDAs for a variety of reasons. Many experts recommend creating a PDA only for unusual endeavors that, for a variety of reasons, the parent city or county would not want to undertake itself – for example, limiting a municipality’s liability for any debts or obligations taken on by the authority, or developing and operating a specific piece of real estate such as an industrial park.

However, RCW 35.21.745 requires any city, town, or county that creates a PDA to control and oversee the PDA's operation and funds in order to ensure that the PDA is reasonably accomplishing its purposes and to correct any deficiencies.

In addition, chapter 43.167 RCW authorizes community preservation and development authorities (CPDAs), which allows for the creation of authorities dedicated to preserving or enhancing the unique historical or cultural character of communities adversely impacted by publicly-funded facilities, public works, or capital projects or by other land use decisions. CPDA formation requires state legislative approval. There are currently two approved CPDAs, both located in Seattle: The Historic South Downtown Community Preservation & Development Authority and the Central District Community Preservation and Development Authority (approved during the 2019 legislative session).

Examples of PDAs and Their Purposes

Below are selected examples of PDAs and the purposes for which they were formed. For a full list of PDAs that MRSC is aware of, see our page List of Public Development Authorities.

Real Estate Development and Management

• Bellevue Public Development Authority (Meydenbauer Center) – Established in 1989 to provide economic stimulation to the community through the construction and operation of the Meydenbauer Convention Center. It is governed by a board of directors appointed by the city manager. The authority is legally separate from the city but is included as a discrete component unit in the city's financial reporting. It derives its revenue from the city’s lease and operation payments and from user fees paid by customers.
• Odessa Public Development Authority – Established in 2000 by the town of Odessa to assist Lincoln County communities with job creation through the acquisition, construction, maintenance, and leasing of an industrial park. It is governed by a seven-member board of directors proposed by the town’s mayor and approved by the town council. It derives most of its revenue from industrial tenants’ rent.
• Republic Public Development Authority – Established in 2003 by the city of Republic to attract businesses to the area through land acquisition and building an industrial park. The authority is governed by an appointed, seven-member board of directors. It is funded primarily through grants and donations.

Arts and Culture

• Cultural Development Authority of King County (4Culture) – Established in 2003 to serve as the cultural services agency for King County and to strengthen the region’s shared heritage through supporting local arts and cultural opportunities. It is governed by a 15-member citizen board nominated by the county executive and confirmed by the county council. 4Culture offers grants and support to public art and heritage preservation projects. It is funded primarily by lodging taxes and the county’s 1% for the Arts ordinance.

Correctional Facilities

• South Correctional Entity Facility Public Development Authority (SCORE PDA) – Formed through interlocal agreement to finance some of the costs of acquiring, constructing, improving and equipping the South Correctional Entity jail. It is governed by the administrative board of the South Correctional Entity. Member cities include Auburn, Burien, Des Moines, Renton, SeaTac, and Tukwila. (Federal Way exited the agreement in 2019 due to rising costs associated with housing prisoners there.) Member cities are obligated to contribute to pay debt service and administrative expenses on the bonds.​

Emergency Communications

• Valley Communications Center Development Authority – Formed by the City of Kent in 2000 to provide an independent legal entity to finance the acquisition, construction, and equipping of a new dispatch facility for the operations of the Valley Communications Center through the issuance and servicing of bonds. The member cities – Federal Way, Kent, Renton, and Tukwila – are each obligated to contribute in equal shares to pay debt service on the bonds and to pay administrative expenses with respect to the bonds.

Examples of PDA Ordinances and Code Provisions

Below are links to selected PDA code provisions and ordinances.

Code Provisions

• Carnation Municipal Code Ch. 19.04 – Public Corporations
• Seattle Municipal Code Ch. 3.110 – Public Corporations
• Spokane Municipal Code Ch. 4.25 – Public Development Authority
• Tacoma Municipal Code Ch. 1.60 – Public Development Corporations
• Union Gap Municipal Code Ch. 2.110 – Public Corporations

Resolutions/Ordinances

• Bellevue:
  • Ordinance No. 4092 (1989) – Creating Bellevue PDA and adopting bylaws
  • Ordinance No. 4708 (1994) – Amending charter; PDA may not file for bankruptcy without written consent of city manager
• Odessa Ordinance No. 546 (2000) – Creating Odessa Public Development Authority; includes charter
• Republic Ordinance No. 2003-07 (2003) – Creating Republic Public Development Authority; includes bylaws

Interlocal Agreements

• Des Moines SCORE Amended Interlocal Agreement (2009) – Agreement between Des Moines (host city) and the cities of Auburn, Federal Way, Renton, Tukwila, Burien, and SeaTac to establish and maintain a correctional facility financed by PDA-issued bonds
• Kent Ordinance No. 3510 (2000) – Approving formation of interlocal Valley Communications Center Development Authority to finance emergency dispatch center through issuance of long-term debt; includes charter and bylaws

Recommended Resources

Below are several useful reports and articles addressing the powers and limitations of public development authorities.

• WA State Auditor's Office: Audit Summary for Public Development Authorities and Public Facilities Districts (2013) – Overview of PDAs and public facilities districts (PFDs), including background information, audit summaries, recommendations to entities that have created PDAs/PFDs, and recommended changes to state law (opens in new window)
• Preston, Gates & Ellis Law Firm (now K&L Gates):
  • Public Development Authorities (2003) by Jay Reich, Stacey Crawshaw Lewis, and Deanna Gregory – Excerpted from MRSC's 2004 Budget Suggestions publication; addresses frequently asked questions about PDAs.
  • City and County Options for Creative Financing: PFDs, PDAs and 501(c)(3)s: Alternative Financing Mechanisms (2003) by Jay Reich and Stacey Crawshaw Lewis – Identifies and compares the advantages and disadvantages of these alternative financing approaches to assist local government decision makers in weighing their options.