Ferndale City Council Committees

**Kevin Renz, on environmental regulation evolution:** "I think that if you look back to, you know 1992-1994 time frame, the concept of wetlands, creek crossings, you know, fish bearing fish passage, none of that was entertained." **Jori Burnett, on AI adoption philosophy:** "Since this is one of those technologies, kind of like the Internet and smartphones before it, that has suddenly popped on scene... there's no scenario where we don't use generative AI. It's already with us." **Mayor Hansen, on fiscal management:** "Our efforts collectively have been to adopt our long-range plans and then to make sure that the capital projects in those plans have the money that they need when those projects are necessary." **Council Member Porter, on AI as a tool:** "You want to be on top of the horse and guide the horse in the direction that you want it to go. And I think as long as we do that and we stay one step ahead of things, I think we'll be OK." **Jori Burnett, on responsible innovation

# Full Meeting Narrative: Ferndale City Council Committees ## Meeting Overview The City of Ferndale held its committee meetings on January 14, 2026, at the City Hall Main Conference Room. The session consisted of two active committees: Public Works & Utilities (8-9 AM) and Finance & Administration (10-11 AM), with the Planning & Land Use Committee cancelled for this session. Mayor Greg Hansen presided over the opening of each committee, with Councilmember Herb Porter chairing both the Public Works and Finance committees. The meetings addressed a range of municipal business from infrastructure development to administrative policy, concluding with a forward-looking discussion on artificial intelligence in city operations. ## Public Works Committee: Shannon Avenue Right-of-Way Vacation The morning began with Public Works Director Kevin Renz presenting a detailed proposal for vacating a portion of Shannon Avenue right-of-way to facilitate the Shannon Highlands multifamily development. Renz provided extensive background on the property's complex history, tracing it back to a 1992 binding site plan for "Ferndale West" that was never fully developed. "As Council does, Shannon Ave. exists within Ferndale," Renz explained while sharing GIS mapping on screen. "This is Shannon Ave. South end. We have a new multifamily housing development that's going in here on the corner that everybody's seen and then over to the east we have Ferndale Terrace coming through." The technical challenge became clear as Renz outlined environmental complications that have made the original plan unfeasible. The proposed road connection would require crossing a creek with significant wetland buffers, necessitating expensive bridge work and fish barrier removal. "The one complicating factor to it would be that if that road network were extended, you would have to do a bridge over the Creek in that area and then once you touch the culvert that goes underneath Shannon at the North End, we're going to have to remove that," Renz noted. Councilmember Porter emphasized that this vacation doesn't represent an abandonment of the original vision, but rather an acknowledgment of changed circumstances. "This is not an extension of Shannon Ave. to Main Street. This is something in years past that they talked about and stuff, but because of environmental regulations and also the fact that there's a Creek that goes through there... it just makes it basically financially unfeasible at this time." The proposed Shannon Highlands development represents a significant housing addition to Ferndale, with approximately 261 units in ten buildings. Renz described it as "not a low end apartment complex" but rather a quality development that will benefit the area. Following thorough discussion, Councilmember Hawkinson moved to forward the resolution to set a public hearing for March 2nd to the consent agenda, which was approved unanimously. ## Environmental Regulations and Development Challenges The Shannon Avenue discussion naturally evolved into a broader conversation about environmental regulations and their impact on development in Washington state. When Councilmember Porter asked whether Washington was an outlier in wetland regulations, Director Renz provided a comprehensive explanation of the federal, state, and local regulatory framework. "There are federal requirements for wetlands that extend throughout the United States," Renz explained. "They're consistent throughout the United States. And you know, you've heard through the the last few years of Supreme Court decisions and opinions by the federal government related to what our water of the United States and whether they're navigable waters." However, he noted that Washington's regulations do exceed federal minimums. "Washington wetland regulations do go in excess of what the federal regulations do and apply more broadly to waters of the state that aren't regulated by the federal government." City Administrator Jori Burnett added context about the practical challenges facing development. "I know Administrator, very fond of saying that all of the best land to develop within the Ferndale city limits has been developed the stuff that's leftover, you know is... this is one of the largest properties in Ferndale, and the reason that you know, gosh, what was it that that site plan was developed in the 90s? And a big reason why it hasn't developed is because you know when you start to incorporate all the wetlands, you you run out of buildable space." Mayor Hansen reflected on the broader housing affordability implications: "We've continually pushed and lobbied for those sorts of changes to some of the wetland legislation in the hopes that it doesn't just help Ferndale helps a lot of other communities." The discussion revealed the tension between environmental protection and housing development, with officials noting examples of neighborhoods built before modern stormwater regulations that now experience flooding during major weather events. ## Finance Committee: Municipal Housekeeping and Fee Updates The Finance & Administration Committee convened at 10 AM with four items on the agenda. Administrative Services Director Susan Duncan presented the first two items, both representing routine but necessary municipal maintenance. ### Municipal Code Cleanup Duncan began with straightforward housekeeping regarding committee name changes. "Council will recall back in July of 2025, you approved amendments to that code changing the name of the Equity Advisory Committee to the Community Impact committee and sort of more closely aligned the work that they're actually doing." The city's codification contractor had identified remaining references to the old committee name scattered throughout Chapter 2 of the municipal code. "Our general code, the company that we contract with for our codification of our ordinances has some really great editors on staff and they noticed in an unrelated code update references in different parts of Chapter 2 that still had equity advisory committee." Rather than making administrative corrections, staff recommended updating these references through ordinance to maintain proper legislative record. The committee unanimously approved placing this item on the consent agenda. ### Comprehensive Fee Schedule Updates Duncan then presented more substantial changes to the unified fee schedule, covering everything from returned check fees to park rental deposits. The most significant change involved reducing NSF fees after the city's bank stopped charging processing fees for returned checks. "Currently the fee schedule has a return to check fee as at $30 and if it's done during water, shut off it's $50," Duncan explained. "Part of the reason for those fees was because the bank charged the city a fee and they no longer do that." When Councilmember Mutchler questioned the different fee levels, Duncan explained the operational rationale: "The only reason that I dropped it from 15 to 25 and not keeping them both the same 1 to incentivize not doing that during shut off, but also our utility billing clerk is just inundated during shutoff." The park fee revisions reflected operational realities and safety concerns. Duncan detailed changes to the Barr Barn rental requirements, moving away from mandatory off-duty police presence to allowing private security companies. "We we required the the presence of an off duty police officer which creates a pretty significant expense to the renter. We haven't actually enforced that since COVID." More importantly, the changes incorporated lessons learned about alcohol-related events. Duncan explained new deposit requirements: "Events with more than 150 participants and or serving alcohol will require a $500 refundable deposit. The reason for that deposit is that oftentimes these events result in clean up needs vandalism and higher incidents of police call outs." The discussion revealed how the city had evolved its approach to event management after experiencing problems with out-of-control parties. Mayor Hansen provided context: "For a while we were was known as the place where if you're going to have a crazy out of control event, go to Ferndale 'cause nobody's supervising you." Police Chief Matt Huffman, participating remotely, confirmed that policy changes had reduced police call-outs: "I do know this last year compared to before I came into this role, it seems like the activity we've had have had down there for the police has been a lot less so so those changes I think have have helped with that." The committee approved the comprehensive fee schedule amendments for the consent agenda. ## Treasury Report: City's Strong Financial Position Finance Director Danielle Ingham presented the fourth quarter 2025 treasury report, showing the city's total treasury balance had reached $70.2 million. The report reflected the city's diversified investment strategy, including both the state's Local Government Investment Pool (LGIP) and purchased bonds. "We went out for two $5,000, 000 ones in December and then we have the two from September all with different maturities," Ingham explained. The weighted average return of 3.78% compared favorably to LGIP's 3.8% return, validating the bond investment strategy as interest rates began declining. Councilmember Mutchler sought clarity about unrestricted funds, asking "How do I look at it in terms of what would be unrestricted type? Suddenly we have this great idea to build a massive swimming pool or something crazy." Ingham clarified that typically only general fund balances are unrestricted, currently around $9 million, with the remaining $60 million committed to specific projects or restricted by funding source. The substantial treasury balance prompted discussion about whether the city was hoarding funds. City Administrator Burnett and Mayor Hansen provided extensive context about the city's capital project planning philosophy. "Our efforts collectively have been to adopt our long range plans and then to make sure that the capital projects in those plans have the money that they need when those projects are necessary," Burnett explained. Mayor Hansen emphasized the contrast with past practices: "15 20 years ago, the city would have never been in a financial position to be able to do that. There would have been some either having to take out a loan or kind of forego other projects in order to pull that off." The officials detailed upcoming major expenditures including the civic campus project, roundabout construction, Ferndale Terrace pump station, and potential Grandview design work. Ingham noted that successful grant acquisition had allowed the city to preserve funds for projects like the portal roundabout that wouldn't qualify for grant funding. Councilmember Pinto-Gonzalez offered perspective on the balance: "I think kind of on that same vein, it would be more alarming if we had 60 million in the general fund uncommitted and 9 million committed to projects, but that 60 million is largely committed or allocated specifically for XY or Z right?" ## Artificial Intelligence Policy: Embracing Responsible Innovation The meeting's final and most forward-looking agenda item involved City Administrator Burnett's presentation of a draft generative artificial intelligence policy. This represented Ferndale's proactive approach to emerging technology governance, putting the city ahead of many similar jurisdictions. "Generative AI is all around us. It is obvious in some ways through specific applications like Chatgbt, Gemini and and copilot. It is also embedded in more and more of the processes or software that we have gotten used to," Burnett explained. "Word, Excel, PowerPoint all use some forms of generative AI." Burnett emphasized the inevitability of AI adoption: "Since this is one of those technologies, kind of like the Internet and smartphones before it, that has suddenly popped on scene, it was really just commercially available in 2023. It's a genie that's already left the bottle, and so we want to say First off, there's no scenario where we don't use generative AI." The policy framework emphasized human oversight while allowing innovation. "We are restricting the use, proposing the use restricted use of AI that is completely autonomous from city human interaction. Instead, kind of looking at AI as a very smart assistant as a way that it can be a force multiplier for existing staff rather than replacing existing staff." ### Disclosure Requirements Debate One of the most nuanced discussions centered on when and how to disclose AI use to the public. Burnett acknowledged the complexity: "I think that it could be argued that nearly any written document or image that you are receiving in your daily lives now has been touched in some way by generative AI." The policy proposed disclosure requirements similar to academic citation practices rather than blanket disclosure of any AI use. "What is your expectation for disclosure where if we're putting something out on social media or staff reports or a graphic... what's your expectation for the disclosure of AI?" Councilmember Pinto-Gonzalez supported the balanced approach: "I definitely think that if AI is used in any capacity, disclosing its utilization is important. But I also feel like... if you're signing your name on that or if you're taking credibility for that in any way shape or form, you're also taking credibility for how you put that report together and any errors that might be included." The discussion revealed understanding that staff accountability remained paramount regardless of AI assistance. "I personally feel like, aside from disclosing the fact that AI was utilized in some capacity, you're going to be taking liability for what you put in front of us," Pinto-Gonzalez continued. ### Balancing Innovation and Oversight Council members expressed varying perspectives on oversight levels. Pinto-Gonzalez articulated concern about micromanagement: "While I would love to revisit this, I'm also not interested in monitoring or telling the administrative staff or otherwise, how to implement or utilize AI, especially if you know you guys have successfully gotten us to this point." Conversely, Councilmember Gunter advocated for regular review: "I would prefer it if we revisit this each year just to look over our policy, look over what we're saying to the community. I think we should be transparent as possible." Councilmember Porter drew parallels to past technological adoption: "You know, the horse is going to be AI. You want to be on top of the horse and guide the horse in the direction that you want it to go. And I think as long as we do that and we stay one step ahead of things, I think we'll be OK." Burnett explained the policy's adaptive structure: "We went into this with a kind of bend, but don't break approach where we have guiding philosophies rather than black and white requirements, where my personal belief is if we have black and white requirements, now we're going to be setting ourselves to violate just because of the evolution." ### Practical Applications and Examples The discussion included concrete examples of AI utility. Burnett noted: "I could have written the entire staff report and the entire policy simply by telling AI: Please create an AI policy for a city jurisdiction and a staff report and done nothing else." However, he emphasized the human review requirement: "What we're trying to avoid here is that it's, you know, it's mostly human generated, but with some help from AI." Mayor Hansen provided practical scenarios: "If it's hey, I generated this and I need to spell check it, cut it down, consolidate it, make it cleaner, make it more easily understood. That that's only a tool that benefited him and me. I don't see the need to find out that AI fact checked your work." The conversation revealed appreciation for AI's potential to enhance rather than replace human work. Porter noted: "I don't think AI is going to replace humans. I think if anything, it will take maybe some of the workload off of some of the work that the people are doing." ## Meeting Conclusion and Administrative Notice As the committee wrapped up, Administrative Services Director Duncan provided a brief notice about an upcoming public records request involving council member emails and communications, demonstrating the city's ongoing attention to transparency requirements. The meeting concluded at approximately 11:30 AM, running slightly over the scheduled time due to the substantive AI policy discussion. The session demonstrated Ferndale's approach to governance: methodical attention to routine municipal business combined with forward-thinking consideration of emerging challenges and opportunities. Both committees showed the collaborative working relationship between council members and staff, with robust discussion that informed decision-making while respecting administrative expertise. The meetings reflected a city government actively managing growth pressures, regulatory complexities, and technological change while maintaining fiscal responsibility and public transparency.

### Meeting Overview The Ferndale City Council Committees met on January 14, 2026, covering two committees: Public Works & Utilities (8-9 AM) and Finance & Administration (10-11+ AM). The main focus was on infrastructure planning, municipal code updates, fee schedule changes, and establishing the city's first artificial intelligence policy. ### Key Terms and Concepts **Right-of-Way Vacation:** A legal process where a city gives up its claim to a portion of public street or right-of-way, typically selling it to adjacent property owners when the public no longer needs it for transportation purposes. **Unified Fee Schedule:** A comprehensive document listing all fees charged by the city for various services, permits, and facilities, reviewed annually to ensure fees reflect actual administrative costs. **Binding Site Plan:** An alternative land division process allowing developers to create a general plan first, then carve off individual lots later without knowing exact tenants upfront, commonly used for commercial developments. **NSF/Return Item Fee:** Charges applied when checks bounce or payments are returned, reduced from $30/$50 to $15/$25 since banks no longer charge the city processing fees. **Generative AI Policy:** Guidelines governing city staff use of artificial intelligence tools like ChatGPT for creating content, requiring human oversight and disclosure when AI significantly contributes to documents. ### Key People at This Meeting | Name | Role / Affiliation | |---|---| | Greg Hansen | Mayor | | Herb Porter | Councilmember, Committee Chair (both PW and Finance) | | Ali Hawkinson | Councilmember | | Erin Gunter | Councilmember | | Jon Mutchler | Councilmember | | McKenna Pinto-Gonzalez | Councilmember | | Kevin Renz | Public Works Director | | Susan Duncan | Administrative Services Director | | Danielle Ingham | Finance Director | | Jori Burnett | City Administrator | ### Background Context The Shannon Avenue right-of-way vacation stems from a 1992 development plan that dedicated roads never built due to wetlands, creek crossings, and evolving environmental regulations. The proposed Shannon Highlands development with 261 multifamily units conflicts with this old right-of-way, prompting the vacation request. Meanwhile, the city is proactively addressing AI use in government operations as staff increasingly adopt tools like ChatGPT for productivity enhancement. The fee schedule changes reflect the city's ongoing effort to align charges with actual costs and improve park rental policies based on operational experience. ### What Happened — The Short Version The Public Works Committee unanimously approved setting a March 2nd public hearing for vacating Shannon Avenue right-of-way to accommodate a 261-unit multifamily development. The Finance Committee approved municipal code housekeeping amendments and significant fee schedule changes, including reduced NSF fees, revised park rental requirements, and new security/alcohol policies. Staff presented a year-end treasury report showing $70.2 million in balances earmarked for major projects. The meeting concluded with extensive discussion of a draft AI policy allowing responsible staff use of generative AI with human oversight requirements. ### What to Watch Next - March 2nd public hearing on Shannon Avenue right-of-way vacation - Implementation of new park rental policies and alcohol service training requirements - Adoption of the city's first AI policy within the next few weeks ---

**Q:** What is the Shannon Highlands development? **A:** A proposed multifamily PUD with approximately 261 units in 10 buildings requiring vacation of Shannon Avenue right-of-way. **Q:** Why can't Shannon Avenue be extended to Main Street as originally planned? **A:** Environmental regulations, creek crossings requiring expensive bridges, and wetlands make the project financially unfeasible. **Q:** How much will NSF fees be reduced to? **A:** From $30 to $15 for regular returned checks, and from $50 to $25 during water shutoffs. **Q:** What new requirement applies to events serving alcohol at city facilities? **A:** Events with 150+ participants serving alcohol require a $500 refundable deposit and MAST (alcohol service training) permits. **Q:** Who chairs both the Public Works and Finance committees? **A:** Councilmember Herb Porter chairs both committees. **Q:** What is the city's current treasury balance? **A:** $70.2 million, with most funds designated for specific capital projects like the civic campus and roundabout. **Q:** When is the public hearing for Shannon Avenue vacation scheduled? **A:** March 2, 2026, at 5:00 PM in Council Chambers. **Q:** What triggered the municipal code amendments for Chapter 2? **A:** General Code editors noticed references to the old "Equity Advisory Committee" instead of "Community Impact Committee." **Q:** What is the main principle of the proposed AI policy? **A:** AI should augment, not replace, human judgment, with all AI-assisted work requiring human review and accountability. **Q:** How much has the Shannon Highlands developer already invested in the vacation process? **A:** Approximately $10,000 in property appraisals plus additional engineering and processing fees. **Q:** What security changes were approved for the Barr Barn? **A:** Allowing private security companies instead of requiring expensive off-duty police officers for events over 150 people. **Q:** Why are wetland regulations particularly challenging in Washington? **A:** The state has more stringent requirements than federal minimums, plus complex environmental reviews and salmon protection requirements. **Q:** What disclosure requirement applies to AI use? **A:** Staff must document when AI significantly contributes to documents, similar to citing academic sources. **Q:** What percentage of Ferndale's treasury is unrestricted funds? **A:** About $9 million in the general fund is unrestricted; the remaining $60+ million is committed to specific projects. **Q:** What happened to Pioneer Park stage rentals? **A:** The fee was removed from the schedule since the stage can no longer be rented. **Q:** When will the civic campus parking structure walls be completed? **A:** After three concrete pours scheduled for mid-to-late January 2026, followed by post-tensioned slab installation. ---