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Commission Meeting Minutes
February 22nd, 2010
COMMISSION MEETING MINUTES
February 22, 2010
9:30 a.m.
PRESENT:
George Schoenfeldt, President Dave Hagiwara, Dir Trade & Dev.
Jim McEntire, Vice-President Jerry Demetriff, Public Works Mgr.
John Calhoun, Secretary Holly Hairell, Human Resources Mgr.
Jeff Robb, Executive Director Doug Sandau, Airport/Marina Mgr.
William James, Director of Finance Dave Neupert, Port Attorney
CALL TO ORDER – OPEN SESSION
PLEDGE OF ALLEGIANCE
TIME SPECIFIC:
A. Pen-Ply Status Report - Josh Renshaw, 9:45 a.m.
B. Financial Reserves Policy Discussion - Jeff Smith, 10:00 a.m.
I. MINUTES OF FEBRUARY 8, 2010 COMMISSION MEETING
Commissioner McEntire stated he reviewed the February 8, 2010 Commission Meeting Minutes, found them to be accurate and complete and made the motion to approve as written. Commissioner Calhoun seconded and the motion passed unanimously.
II. EARLY PUBLIC COMMENT SESSION
Diane Nelson and Sonja Rotter from the League of Women Voters of Clallam County presented a balloon bouquet to the Port Commissioners in appreciation for their commitment to serve the community. The League of Women Voters is a non-partisan political organization and this year marks the 100th anniversary of Washington State women securing the vote and the 90th anniversary of the passage of the 19th Amendment to the United States Constitution. The League publishes an annual directory of all elected officials in the County and Ms Nelson and Ms Rotter distributed copies of the 2010 edition entitled “They Represent You” to the Commissioners and staff.
III. MARINAS
A. Sheet Pile Contract Completion
Public Works Manager Jerry Demetriff briefed the Commission on the Port of Port Angeles Boat Yard (PABY) Sheet Pile project. As part of the 2009 capital improvement budget as well as the 2010 Work Plan, this project identified the need to replace the waler on the existing sheet pile at the Travel Lift Haul out and enclose with new sheet pile and waler. The engineer’s estimate for this project was $80,000.00 to $100,000.00 and the project was solicited by electronic Public Works Roster in January 2010. Wilson Construction responded with a bid of $70,033.45. Mr. Demetriff indicated the lack of bids was due to the short timeframe for permits for in-water construction to be completed by February 15. The contract was awarded January 25 and the work was completed February 17. There was one change order due to engineering changes in the amount of $874.46 including tax. The amount budgeted for the installation of the sheet pile, walers, deadman and cable tie back system was $200,000. Wilson Construction completed the first phase of this multi-phase project. Mr. Demetriff reported that Port crews will install the deadman and cable system later in the year. This report is a matter of public record and Executive Director Robb accepts the contract with Wilson Construction as complete this date. Today starts the 30-day process for the 5% retainage in the amount of $3,270.66 which will be released on March 22, 2010.
B. Boat Yard Storm Water Retro-fit Grant Application
Executive Director Robb informed the Commission a storm water grant application was submitted two weeks ago to the Maritime Administration (MARAD) for storm water improvement for the Boat Yard in the amount of $373,000.00 of which the Federal request is $279,750.00. The purpose is to address storm water improvements and to meet DOE standards for discharge. Discussion followed on compliance standards timelines and the stringent guidelines DOE has adopted. Public Works Manager Jerry Demetriff noted that the boat yard permit is effective July 1 and industrial storm water permits were effective January 1, 2010.
Commissioner McEntire stated he believes this will require a lot of money and he is concerned about how it is going to affect the capital budget. He commented that he would appreciate a primer on this topic with about one-half hour of a future meeting on standards, implementation timelines and guidelines. Executive Director Robb emphasized that the storm water permitting issue is very technical and the Port could invite Landau Associates engineering firm to do a presentation. He will try to schedule that to occur within the next month. Commissioners Schoenfeldt and Calhoun concurred. Commissioner Calhoun indicated he would also like to include in that element any opportunities to coordinated discharge and processing with other entities on the harbor to use common infrastructure.
IV. AIRPORTS
A. Runway Lighting Operational Modifications
Doug Sandau, Airport/Marinas Manager, provided information on the modification of FIA runway lighting, reducing operating overhead and improving overall safety. He explained that the lighting system runs continuously 24 hours, but that airport usage after 10:00 pm is almost nonexistent. Beginning March 1, lighting after sunset will be pilot activated only. This is the industry standard for Runway 08-26 and users and tenants have been informed. Lights on Runway 13-31 will be taken out of service and the runway will be day use only.
V. OLD BUSINESS
B. Financial Reserves Policy Discussion – Jeff Smith 10:00 a.m. (out of order - 9:50 a.m.)
Bill James, Director of Administration and Finance, related that Investment Policy Resolution 10-987 was previously presented to the Commission in late 2009 and he introduced Jeff Smith, CPA for a presentation on this topic. Mr. Smith provided a Power Point presentation (attached and on file in Port Admin offices) with a detailed explanation of the Port’s Investment Policy. He concentrated on five changing issues from the current Resolution 884 approved in 2002 to Resolution No. 10-987 which has not yet been adopted. The five changes concern the following: establishing qualified banks and brokers; qualifying investments; maximum maturities extended from 5 to 10 years; commercial bank selection process added and establishing minimum cash and investments. Mr. Smith pointed out options with defined charts and graphs and explained the contrasts of the 6, 9 and 12-month reserves policy. Commission questions on policy options and return on investment were answered as the presentation proceeded.
The Commissioners concurred they are comfortable with the12-month standard for operating funds at this point and would like to return at a later date to examine the 9-month standard. They individually expressed thanks to Mr. Smith for his excellent and informative presentation.
C. Resolution No. 10-987 Investment Policy
Commissioner McEntire moved to approve and adopt Port of Port Angeles Investment Policy Resolution No. 10-987. The motion was seconded by Commissioner Calhoun and passed unanimously.
A. Pen-Ply Status Report – Josh Renshaw 9:45 a.m. (out of order -10:30 a.m.)
Pen-Ply President Josh Renshaw provided a brief update and reported that 72 employees currently are in the process of orientation for a total of 124 full-time family wage jobs with full medical and dental. He stated they have great maintenance and production people and the plant is ready to produce plywood. They are taking calls from excited customers. Mr. Renshaw said he can’t thank the Port enough because they would not have gotten where they are without the leadership and support of the entire Commission and the execution capabilities of Jeff Robb. He also commended Commissioner Schoenfeldt who was there for them from day one and he emphasized there has been a tremendous amount of support and good will from the community. Mr. Renshaw stated they are ready to go and that this is a very big day. He indicated there will be a ribbon cutting ceremony in the near future for the community and that legislators will be invited. He also commented they will be expanding the number of employees within the next several months.
Commissioner Schoenfeldt thanked Mr. Renshaw for his determination and stated that without him this would not have happened. He said that Josh was a great inspiration and this is a great day for the community and the entire County. Commissioners McEntire and Calhoun individually offered congratulations and thanks for Mr. Renshaw’s perseverance and emphasized the great impact to the community.
D. Resolution No. 10-994 to Encourage DOE to Expedite Agreed Order
Executive Director Robb commented that Resolution No. 10-994 was introduced to the Commissioners at the previous meeting and, in the absence of Commissioner Calhoun, the decision was made to wait to adopt at today’s meeting. He reiterated it closely mirrors a City resolution sent to DOE to encourage them to expedite the Agreed Order for the Rayonier site to something significantly less than three years. It is brought to the Commission for consideration and adoption.
Noting this was discussed at the previous meeting, Commissioner Calhoun said he appreciates his fellow Commissioners waiting for his presence to participate and he reiterated his position for strong support for this site to advance the economic condition of the community. He said that the community cannot continue to be held hostage by a multi-faceted international corporation and a faceless bureaucracy and we need to control our own destiny. Commissioner McEntire stated he could find nothing in the State Statutes that would require an additional 3-year paperwork period on top of the 10 years to return the site to productive use. Commissioner Schoenfeldt echoed those concerns and thoughts.
Commissioner McEntire made the motion to adopt Resolution No. 10-994 To Encourage DOE to Expedite Agreed Order DE 6815. The motion was seconded by Commissioner Calhoun and passed unanimously.
E. Alternative D - Harbor Works Preferred Alternative
Executive Director Robb remarked this was presented at the last meeting and that Alternative D is a combination of B and C blended to reflect the Port’s vision for marine and industrial use on the west side of the property. He reiterated this was brought forth at the previous Commission meeting and that Commissioner McEntire had provided a number of important bullet points for the record. Alternative D does not bind the Port to a particular course of action but is a way of moving forward. Noting that it was not the usual procedure, Commissioner Calhoun suggested hearing public comments before adopting the Resolution.
VI. PUBLIC COMMENTS SESSION
Jerry Hendricks, Port Angeles resident and HW board member said he believes we should look at potential Port ownership in similar fashion. He said you never know when opportunities are going to show up and his experience is that if you don’t respond in a six-month window, then they go elsewhere. The opportunities this site has for the community is currently undefined. He believes Plan D demonstrates some reality with a number of uses, that it identifies public access areas, deals with issues around historic native American use and provides the Port a sizable chunk of property for long-term marine use and activities. He specified it provides a blueprint to move forward and to develop some economic analysis and he encouraged the Commission to consider the long-term aspects.
Norma Turner, Port Angeles resident, suggested and then asked if the Port originally supported Harbor Works because they wanted industrial development on the site. She inquired if that is still true. Commissioner Calhoun reiterated that marine industrial is designated on 23 acres of the site in Alternative D. She indicated she doesn’t know what marine industrial means to which Commissioner Calhoun stated it could be ship building.
Louis Welch, South Mt. Angeles Rd., said he has read the due diligence report in detail and that it has raised more questions than it has answers. He stated he finds the Port proposal more interesting than the other alternatives and then asked two questions about HW in general. First, have we created something that we will pay for years and years to come and in which there will be no income. He sees nothing that indicates the ability to be able to repay the present loans. He read from a page in the due diligence report concerning the level of environmental cleanup where it states it is not included but is restricted during the period of due diligence and property purchase evaluation and negotiation. He said he believes Rayonier has a good idea of cost and since it is restricted information, he hopes someone is getting the information and he hopes it is the Port. He hates to think the Port is making a decision on where the money is going to go if there is no idea what the cost is going to be. Secondly, he stated the report two times mentions $400 million as the cost of cleanup. Mr. Welch remarked that he hopes that before the Commission goes any further that they have a complete understanding of what is going on.
Orville Campbell, Port Angeles resident and HW board member, thanked the Commission for taking the time to determine what the Port needs are likely to be in the future and that he hopes they will stay engaged in the process as it moves forward. There are questions yet to be resolved and they hope to do that in public dialogue that will provide a valuable asset for City and the surround community.
Norma Turner spoke again and commented that there was obviously a common writer of both the City and Port Resolutions regarding the Agreed Order, but they do not totally mirror each other and that they seem to have a different view. She believes there is a conflict between numbers 1 and 4 and indicated that paragraph 1 uses the verb “pending” and then in paragraph 4 it states “there has already been substantial cleanup”. She believes those two are in conflict with each other. Secondly, the most critical piece to her is in number 3 and that the City deleted that section from their resolution. She said there seems to be a difference of opinion and that the Port is proceeding to make sure there is a real estate transaction and that the City no longer endorses that language. In her opinion, the City and the Port, even though partners, seem to have different views in proceeding rapidly in buying a contaminated site. She said that when HW was formed the Port publicly committed one million dollars but her questions to that record have never been satisfactorily answered. She is concerned that the Port is ready to adopt a resolution endorsing the transaction with no public discussion. Ms. Turner stated that the Port 2010 Work Plan states the uncertainty on the amount of cleanup and purchase and she is curious when it is appropriate to let the public know what the commitment is.
Commissioner Calhoun said he appreciates public comments and that the Commission has not made a final decision on acquisition at this point. There is more information to gather and that will be developed. He pointed out that the Port has a unique opportunity in development of this property and that the Port is the only entity that has patient capitol. He affirmed it is an expectation of the Port to provide for long-term development of property and that it is a common function of Ports to exercise their patient capital. Commissioner Schoenfeldt reiterated that the public needs to understand that the Port has not made a decision as yet. Commissioner McEntire agreed that the decision has yet to be made and that HW is hard at work with the task of developing and understanding how to proceed.
Commissioner McEntire made the motion to adopt Alternative D to present to the Harbor Works Board as the Port’s Preferred Alternative for future development for the Rayonier site. Commissioner Calhoun seconded and the motion passed unanimously.
VII. ITEMS NOT ON THE AGENDA
A. Commissioner McEntire commented on two legislative issues. HB 3176 is still on the table and has different sections that try to close loopholes in the Washington state tax code, one of which is section 11 which establishes a road utility tax on interstate commerce. That could mean higher tax bills with entities such as Nippon, log container operations and installation of a tax on Coho Ferry passengers. He said it is in essence a new tax and he is concerned with this particular bill.
B. Regarding Senate Bill 6603, Commissioner McEntire indicated that the WPPA has encouraged all the Ports to contact their legislators to support this bill that deals with encroachments around airports.
C. Executive Director Robb informed the Commission that he has signed a Lease Amendment No. 2 with Pen-Ply that extends the lease bond for an April 1 start.
D. Director Robb announced that we received the Small Community Air Service Grant in the amount of $360,000 for a $40,000 match of Port funds, City of Sequim, City of PA and Clallam County.
E. Director Robb announced that the Port submitted an appropriation request to Senators Murray and Cantwell and will submit a request to Representative Norm Dicks office next this week. He stated this is the first appropriation request the Port has ever submitted
F. The Port will have a booth at the Home Show this weekend with public outreach so that constituents know what we are doing for them in the community.
G. There is a Timber Industry meeting tomorrow in the Commission Meeting Room to talk about the state of timber interest in the economy.
VIII. NEXT MEETING – MARCH 8, 2010
IX. EXECUTIVE SESSION
The Board of Commissioners will now move into executive session to consider one property item, one item of personnel and no litigation items. These items are discussed in executive session in accordance with title 42.30.110 of the Revised Code of Washington. It is estimated that the executive session will conclude in thirty minutes. No action is expected.
X. ADJOURN
Commissioner Schoenfeldt adjourned the meeting at 12: 15 p.m.
PORT OF PORT ANGELES
BOARD OF COMMISSIONERS
___________________________
George S. Schoenfeldt, President
_______________________
John M. Calhoun, Secretary
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