The city of Bellevue has changed the zoning rules for Kelsey Creek Center to make it easier for re-development of the mostly vacant shopping area, which has become an eyesore for the neighborhood since Kmart left in 2000.

Previous guidelines required any builder that adds new commercial space to the site to open, or “daylight,” a covered stream that now flows through a concrete culvert below the property.

The rule made re-development of the 16-acre site nearly impossible.

Costco at one point had planned on leasing the former Kmart space at Kelsey Creek for a new Costco Fresh shopping center, but the zoning agreement prevented necessary renovations.

The previous zoning agreement didn’t allow enough room for a new building, an opened stream, and sufficient parking, according to Bellevue land-use director Carol Helland.

“The regular format for Costco stores couldn’t have been accommodated on that site back then,” Helland said.

The city council last month unanimously approved a new zoning agreement that would allow the property owner, Nat Franklin of Franklin West, LLC, to avoid daylighting the stream by paying around $585,000 toward off-site mitigation such as removing invasive plants, adding native species, and getting rid of disturbances caused by farming.

“It will provide the same or greater environmental functions as if the stream were daylighted,” Helland said.

The environmental mitigation would take place east and north of Larsen Lake, a body of water that Kelsey Creek feeds into.

Costco dropped plans for building a Costco Fresh at Kelsey Creek during the economic downturn around 2001, but was reportedly considering plans to open another type of store there. The company abandoned all thought of using the site in November 2008.

Bellevue’s new zoning agreement still designates the area for commercial business, as it had been in the past.

Franklin did not return a call requesting comment on his plans for the Kelsey Creek site in time for the publishing of this article.