Bellingham has had that same problem, but the city government is doing a great job of making that problem go away. Every undeveloped piece of land is getting jammed with apartments and townhomes, and the city is seriously considering lifting the requirement for parking spaces (so a developer could build a 150 unit apartment building and be required to provide exactly ZERO parking spaces). I think someone has already submitted a plan for a 150 unit apartment building, but only 75-100 parking spaces. Its close enough to Western that it might work/make sense, but it would still be a stretch.
Oh and they are converting car lanes into bike lanes.
Downtown is already dying, so many restaurants and businesses are being forced to close.