Lacey Washington History


By Ken Balsley

Mullen's Resort, high dive with skating rink in background, ca. 1930. Photo courtesy Lacey Museum, Mullen Collection

It was 1961.  The repressed 1950’s were coming to an end, and the roaring 60’s wouldn’t really start for another few years.

Rock and Roll was still new, The Beatles were playing in Hamburg and AM radio still dominated the airwaves.

The civil rights movement was on the verge of starting but the woman’s movement wasn’t even in sight.

In Thurston County, downtown Olympia wasn’t only the dominate player for retail sales, it was the only player.

Penney’s, Sears, Millers, Wards and MM Morris, the major retailers in the county, were all in downtown Olympia, located in just three blocks.

The Olympia political scene was dominated by downtown business owners who held all three seats on the three-member Olympia City Commission.

There was only one chamber of commerce – Olympia and there was only one Rotary Club – Olympia – which met Fridays at noon in the Olympian Hotel ballroom.

To say the least, Olympia controlled business and politics in Thurston County.

But, out in the rural area of the county, out towards the East, in the area that was known as Lacey, something was stirring.

Entrepreneurs, chaffing at the restrictions of the decade and the downtown Olympia political establishment, were looking at removing the roadblocks which held them in place, and looking at new and innovative business models.

Lacey had some business already.  A few stores, restaurants, gas stations and a small shopping center.  It also had a drive-in theater.

But, new businessmen were prowling the outskirts, looking at opportunities.

Al Thompson was creating the housing development of Tanglewilde.

Taking advantage of cheap land and cheap water, new houses were going up all over the area known as Lacey.

Mo Loveless, with the idea for a new type of retirement community, had purchased the old Capitol City Golf Course and was beginning to build the new Panorama City.

And Bob Blume, operating from the back of his sporting goods store, was building Brentwood and Belair, and looking at another opportunity.

And, that opportunity took the guise of Interstate Five, the new freeway system under construction from coast to coast.  Blume was sure the freeway would create new opportunities and he wanted to take advantage of that.

Interstate Five was not originally planned to go through Olympia.  It was initially planned to cut off at Maytown and go through Yelm, It was only political pressure from the state legislature that got a small branch of the freeway through Olympia.  They thought the capital city should be accessible by a freeway.  To placate them, the feds agreed to run a small branch freeway through Olympia.

Blume knew that where transportation went, financial opportunities were to follow.  It was like a river of commerce, he once said.  Wherever there was an interstate freeway off ramp, there was a new port city.

After driving the proposed route, and looking at land acquisition opportunities, he found what he wanted in Lacey.   Relatively cheap land with a planned freeway off ramp.

He began to acquire property; enough property to build his new shopping center.

A downtown was still the norm for most cities, with all of the shopping, restaurants and entertainment.  But a new concept was creeping into the mix – – the shopping center.

Only Lloyd’s Center in Portland and Northgate in Seattle existed in 1961, and Blume’s idea to build a shopping center in Lacey was laughed at.   No one is going to drive to Lacey to shop, the Olympia downtown business interests said.

But, Blume wasn’t deterred and started acquiring the land with money borrowed from East Coast banks.  He negotiated with Sears to come to the center and began building South Sound Center.

At the same time, a small group of Lacey business owners began to talk about forming a “chamber of commerce” to promote Lacey interests.

Complicating matters was the fact that Lacey wasn’t even a city.  It was nothing more than a group of small businesses and a few housing developments.

Both Blume and Loveless realized that their efforts would be a lot easier if there was a city.  They could use the taxing and bonding capacity to build infrastructure, streets and street lights, necessary to attract and retain customers.

In the meantime, events in Lacey weren’t going unnoticed by Olympia business interests.  While not feeling threatened, they did see that the possibility existed that the area to the east could be a problem.

That become more evident, when residents of the Lacey area opted to incorporate as a city.

Lacey Depot, looking west along tracks, ca. 1910. Photo courtesy Lacey Museum, Ken Balsley Collection

The resulting election failed.  While Lacey business interests were almost fully in support of a new city, not all of the residents were, and the first effort to incorporate as a city failed.

Recognizing the possibility of a new city, Olympia moved quickly following that first election and annexed several parcels of land that had been included in that first incorporation try, including Fones Road and its manufacturing base, and the retail base on Martin Way, all the way to College Street.

Then, in 1966, Lacey tried again.  Helped by the Lacey Fire District, and its large number of volunteers, who were concerned that Olympia was going to take over the fire department, the effort was a success. On December 5, 1966 the results of the election were certified and Lacey became an incorporated  city.

That wasn’t the last fight with the City of Olympia.  A year later, Olympia tried to run a ballot measure to annex the City of Lacey into Olympia.  It failed.

With the beginning of city hood, Lacey faced a new problem.  It had no money, no staff, and no idea of what it was going to do.

Elected as mayor was Al Homann, who was the contractor building South Sound Center.  On the city council was Tom Huntamer, owner of the city’s major water system and later to serve as the city’s second mayor.  Lacey businessmen, for the most part, made up the rest of the city council.

Panorama City opened in 1963, South Sound Center opened in 1966 and the two projects together, put Lacey on the map.

Downtown lost Sears, which moved to South Sound.   Soon other major retailers were leaving, and Lacey was their destination.

It wasn’t long before everyone with something to sell, moved to Lacey and the many shopping centers opening around the town.

But Lacey political leaders continued to bicker and fight among themselves.   Was Lacey a “free market” city where anything went, or did the city have to conform to some community-wide standard.

The first battle came over a bus system.   Olympia ran a bus system that went out to Tumwater, but it didn’t run into Lacey. Political leaders on both sides drew a line in the sand.

Lacey political and business leaders wanted bus service, to bring customers to South Sound Center and other Lacey businesses.  The business men controlling Olympia politics didn’t want to drive another nail in downtown Olympia’s coffin.

It was Lacey’s leaders who blinked first.  Lacey agreed to buy into the bus system, pay an entrance fee, and pay to have the service extended.

Then, Lacey needed sewers.  Most of the city was on septic systems and in many parts of the city, the land wasn’t conducive to long term septic system use.

Olympia owned and operated the only sewer system in the area.   Lacey couldn’t afford to start its own system and connection to Olympia’s system was the only solution.

Again, the battle lines were drawn.  And again, this time with help from the Department of Ecology, Lacey agreed to buy into the system, pay an entrance fee and let Olympia manage it.

Those battles later led to intergovernmental agreements and Intercity Transit and LOTT were eventually formed.  Continued negotiation also eventually put Lacey and Olympia on the same footing.

Into the 70’s and 80’s Lacey came to dominate retail shopping, until the opening of the Capital Mall on Olympia’s Westside.   In no time at all, the mall’s owners, with deep pockets took a major portion of the retail trade and Lacey became, if not a backwater, at least a more minor player in business.

During this time, conflict between the Lacey and Olympia chambers continued to play out.  In the beginning, the two chambers cooperated, had joint committees and even held joint meetings.  The president of each chamber was an ex-officio member of the other chamber’s board.

But, three times, the latest in 1997, the Olympia chamber attempted to take over or assimilate the Lacey chamber.  Each time they were rebuffed.

The climb out of Olympia’s shadow started in 1986 when Greg Cuoio was hired as the new city manager, and under the leadership of Mayor Kay Boyd, annexed the property known as Hawk’s Prairie.

With the city’s eye being cast further to the east and with city leadership eying new business, Lacey began to emerge as more than just a sub-set of Olympia.

In my mind, two events removed any doubt that Lacey was now its own community.

Under the leadership of Cuoio, the city seized the Public Facility District money which Olympia thought was theirs.  From that effort came the Regional Athletic Complex (the RAC) which put the city on the sports map.

Then, in 2001, came the war against terror.  It was then that residents of Lacey began to realize the large number of military families which resided in the community.

With the leadership of the Hawks Prairie Rotary Club came the creation of the Military Family Support March and the “Homecoming” statue on Marvin Road.

Lacey was now a military community with close ties to military families.   Retired military and military spouses have involved themselves deeply into the community.

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