Meeting Agendas and Minutes
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Commission Meeting Minutes
May 24th, 2010
COMMISSION MEETING MINUTES
May 24, 2010
9:30 a.m.
PRESENT:
George Schoenfeldt, President Jerry Demetriff, Public Works Mgr
Jim McEntire, Vice-President Doug Sandau, Airport/Marina Mgr.
John Calhoun, Secretary Pat Deja, Property/Mkrt Mgr
Jeff Robb, Executive Director Holly Hairell, Human Resources Mgr.
William James, Director of Finance Dave Neupert, Port Attorney
Dave Hagiwara, Dir Trade & Dev.
CALL TO ORDER – OPEN SESSION
PLEDGE OF ALLEGIANCE
TIME SPECIFIC
A. 10:00 a.m. PEAK Leadership Program – Danille Turissini
I. MINUTES OF MAY 10, 2010 COMMISSION MEETING
Commissioner Calhoun stated he reviewed the May 10, 2010 Commission Meeting Minutes, found them to be a fair representation of the proceedings and made the motion to accept as presented. Commissioner McEntire seconded and the motion passed unanimously.
II. EARLY PUBLIC COMMENT SESSION
Harry Bell (Representing the Water Committee of Port Angeles Business Association) said the PABA has been educating themselves on the proposed industry rule laws that are being developed by the Department of Ecology (DOE). They have concerns about the long-term impacts of the rules and what they could do to economic development in our community. In January/February 2010, they complained to State representatives and then set up a meeting with the head of DOE. They had the meeting with DOE and have brought a copy of the response back from DOE to the Commission. They then sent a letter back to legislators to look at the potential solutions. Mr. Bell encouraged the Board of Commissioners to get engaged in the water issues and take appropriate action.
Commissioner Calhoun asked Mr. Bell to give the Board any indications for areas of concern regarding economic development impacts. Mr. Bell responded that water law is complex and that DOE is talking about changing the water laws. Two issues the Water Committee of PABA is concerned about are; setting an in-stream flow that is adequate for fish so that the water is not drawn down. His questions then are, “how do you do that” and “what is the balance between what fish and people need?” Mr. Bell detailed watershed areas 18 and 19 and how they could potentially be affected by the new proposed rule laws. The second issue they are concerned about is permit exempt wells. Mr. Bell then gave background on the permit exempt wells and their effect on water rights.
Commissioner Calhoun stated that as he understood it, these rule laws are being proposed by DOE to provide adequate water for fish. Mr. Bell explained how DOE established the needed water levels.
Commissioner McEntire inquired about the processes of DOE and whether, per the Washington State Administrative Act, they have to look at the economic impact of their proposed rules? Mr. Bell thought they did. Commissioner McEntire then asked if there is enough evidence and scientific process to accomplish the objectives of the rules DOE proposes. Mr. Bell answered by detailing connectivity, spatial and water bank issues that he thinks are being glossed over. Mr. Bell concluded by proposing the idea of another one day workshop to get all stakeholders engaged. Commissioner Schoenfeldt encouraged another workshop on this topic to get more people in the community involved.
Commissioner Calhoun invited audience member, Carol Johnson, Executive Director of North Olympic Timber Action Committee (NOTAC), to give a short description of the Wild Olympic Campaign and the campaign’s elements and concerns regarding economic impacts. NOTAC became aware of the campaign about a month ago. A group of about ten environmental groups got together a couple years ago to get the campaign going and began discussing water. Mrs. Johnson then gave background on potentially affected areas and the research the group did. Mrs. Johnson voiced her concerns about the potentially affected timberlands and the economic repercussions in the community.
Commissioner Calhoun voiced his concern regarding the Wild Olympic Campaign and how it could negatively impact the local economy. He stated that Clallam County has indicated they are in support of the campaign and that they have sent a letter to Norm Dicks’ office. He stated that he would like to see a resolution on these issues from the Board and get more information on why the County is in support of the Campaign. Commissioner Schoenfeldt thanked Mrs. Johnson for the information and assured her that the Commission would be looking at these issues. Commissioner McEntire requested a copy of the County’s letter so he could read it. He believes the Port needs to carefully consider the position it takes, given our economic development mission.
III. PLANNING
A. Marine Terminal/Log Booming SEPA Report
Dave Hagiwara, Director of Trade and Economic Development, detailed the project at the Port Marine Terminals and Log Yard to replace up to 18 timber piles and/or dolphins with steel piles. This project would provide safe berthing for vessels and reliable log booming/rafting. Mr. Hagiwara discussed how the Port has to put in a permit that includes various facilities where the piles are going to be replaced. He referenced Resolution 569 and how staff followed the SEPA process. After a thorough review, the Port issued a “Determination of Nonsignificance” or DNS on April 19, 2010. Mr. Hagiwara stated that no Commission action is required, but asked to have these actions acknowledged in the meeting minutes.
IV. PROPERTY
A. Homeland Security Lease Modifications
Executive Director Robb gave a brief background of the lease of 1908 South “O” Street with the US Department of Homeland Security. The tenant would like three, one- year extensions to their current lease as they are doing some interior modifications and exterior fencing. The current lease would be renewed 6/25/11 and would include the three, one-year extensions. Director Robb stated that the US Dept. of Homeland Security’s lease rate is reflective of a full service lease. He then asked the Commission for permission to enter into the three, one-year options as outlined.
Commissioner Calhoun asked about Homeland Security’s long-term plans given that they are only asking for three, one-year options. He also asked if the Port was currently getting fair market value for the lease. Mr. Dave Hagiwara commented that the lease rate was based on an appraisal done in 2009. He then clarified that the three year period gives them a five-year lease to make the extensive changes they desire to the facility. Commissioner McEntire stated that he thinks the Port should look at the Port’s long-term plans for Homeland Security.
Commissioner McEntire made a motion to authorize Executive Director Robb to enter into the lease extension of the three, one-year options with the US Department of Homeland Security. Commissioner Calhoun seconded the motion and the motion passed unanimously.
B. PenPly Status Report
Josh Renshaw, President of Peninsula Plywood, reported on the fire in the boiler room’s control booth at the mill. He said the fire didn’t damage the building, but the control room was severely damaged. Mr. Renshaw reported that PenPly’s maintenance group performed brilliantly. The new boiler was here on Monday and ORCAA signed off the permits on Thursday. He said it will be a month to get the control room fixed, but the interim boiler is working fine. Crews came back at work on Friday and only lost two days work. Mr. Renshaw said it was frustrating because they were really starting to hum, but even so, ten more workers started last week.
Commissioner Schoenfeldt commended Mr. Renshaw on the mill’s quick response after the fire and their ability to get things running again. Mr. Renshaw said the fire was like a test and they came through it well giving them confidence.
V. MARINAS
A. Resolution No. 10-996 – Sale of Abandoned Vessels
Bill James, Director of Finance and Administration, presented Resolution No. 10-996 authorizing four vessels (“Spirit of 76,” “WN6490 V,” “Misfit,” and “Trinity.”) for auction at the Port Angeles Boat Haven and John Wayne Marina to recover accumulated charges. State law requires Commission approval before the sale can take place and Mr. James asked for consideration and approval to adopt the Resolution.
Commissioner McEntire moved to adopt and approve Sale of Abandoned Vessels Resolution No. 10-996 and authorize the auction to proceed. Commissioner Calhoun seconded and the motion passed unanimously.
VI. NEW BUSINESS
A. 10:00 a.m. - PEAK Leadership Program - Danille Turissini
Commissioner Calhoun introduced Danielle Turissini and expressed his interest in leadership training in Clallam County and how it is important for the Port to support these types of initiatives. He thought a presentation by Ms. Turissini would be appropriate to detail the elements of the PEAK Leadership Program. Ms. Turissini is a graduate of the program and it transformed her and made her more effective in her community. PEAK had its first class and realized they had a good effort going. Now they are their own 501(c)3. PEAK leadership is a 10-month adult community leadership program. The goal is to develop leaders on the North Olympic Peninsula and to foster leaders to come to collective agreements that are good for the community. The classroom is the entire North Olympic Peninsula where local experts are brought in to teach. PEAK creates connections between the North Olympic Peninsula communities and helps them understand each others challenges. Ms. Turissini ran through a Power Point presentation of the PEAK Leadership Program sharing photos of the different elements the program covered and organizations they visited.
Commissioner Calhoun thanked her for her presentation and stated this type of program is a long-term infrastructure investment the Port needs to make. He said that folks make a difference when they come out of the program. PEAK Leadership is trying to make the program a sustainable and viable program. Class 3 is currently being recruited and $18,000 is invested in each student. Students pay $1,000 in tuition to be part of the program. Commissioner Calhoun asked the Board to consider a $1,000 contribution to the program.
Commissioner McEntire requested that Port staff consider and explore contributing more to the PEAK Leadership program during budget time. Commissioner Calhoun has made a commitment to the program as well. Executive Director Robb asked for clarification on the cost of each person to go through the program. Director Robb then requested a motion.
Commissioner McEntire moved to approve a $1,000 contribution to the PEAK Leadership Program. Port Attorney Dave Neupert interjected and said the contribution will require legal review. Commissioner Calhoun seconded the motion subject to legal review and it passed unanimously.
B. North Olympic Visitor Bureau Annual Report - Diane Schostak
Diane Schostak of the Olympic Peninsula Visitors Bureau (OPVB) began the annual report by stating that tourism is a $113 million industry in Clallam County. She then provided a recap of the year detailing different ventures (Culinary Loop, Juan de Fuca Byway, Waterfall Trail, Cruise Ship coordination, etc.) of the OPVB to bring tourists to the Peninsula. Please see the attached presentation report for specifics.
Ms. Schostak also thanked the Port for providing economical rent to the OPVB. She then introduced Gloria Cerney, OPVB’s Office Manager who gave a summary of her duties with the bureau. Ms. Schostak also described the work of Mary Brelsford, OPVB’s Communications and Projects Manager.
Commissioner McEntire inquired about the lodging tax spreadsheet in the presentation packet and how to interpret the numbers.
In conclusion, Ms. Schostak reminded the Commission of tourism industry’s economic impact in Clallam County. She said that the Peninsula’s bread and butter is Puget Sound residents’ weekend getaways to our area. Commissioner Schoenfeldt expressed his thanks for her comments and information.
Commissioner Calhoun asked about the Economic Development Summit and stated that one of the five critical areas was tourism. He described how the summit thought that the community was missing something in bringing folks to the area and then asked her what she thought it would be. Ms. Schostak responded that private sector investment is missing in bringing tourists to the Peninsula. She used the Zip Line project as an example of where private investment could make the project a reality. Ms. Schostak stated that the local community needs to embrace tourism and its benefits and used the City of Forks as an example of this with the Twilight frenzy. Commissioner McEntire requested that Ms. Schostak think of market segments that the Port could delve into within our statutory authority to promote tourism in Clallam County.
C. Marina Rate Review, Part I, Outline
Bill James, Director of Finance and Administration, stated that the last rate reviews for the John Wayne Marina and the Port Angeles Boat Haven were in 2005 and 2006. There were two hearings and the reviews gave us a five-year plan for rate increases. In 2010, the Board of Commissioners modified the rate plan to freeze 2009 and 2010 rates due to the suffering economy.
Mr. James detailed the proposed Marina Rate Review schedule which will include presentations at every Commission meeting until August 26, 2010. The first meeting in June would have the completion of the first four components. He then detailed what each Commission meeting would cover and stated there would also be three public workshops. Mr. James asked the Commission to consider the proposed Marina Rate Review components and schedule.
Commissioner Calhoun stated that rates should be at fair market value, but thinks that the Marina Rate Review might be too much effort to come to an obvious conclusion. He stated that the Port’s rates are fair and comparable and he would like to short cut the process. Commissioner Calhoun directed staff to bring forth a proposal that includes the Consumer Price Index (CPI) and indicated that a comprehensive review should be done in 2013 for the following year’s budget.
Commissioner Schoenfeldt stated that he doesn’t think that this is the time to do a rate review. Commissioner McEntire said that he agrees with this concept due to the occupancy numbers and the general economy not being stable yet. He then requested that staff come to next meeting with a proposal to move forward. Commissioner McEntrire suggested that the proposal should include a negative CPI as well.
D. Ten-Year Financial Statement Summary
Bill James, Director of Finance and Administration presented the 10-year financial statement review. On the operating side, Port expenses exceed revenues when depreciation is included. He stated that the most significant number is depreciation. Without depreciation, the difference between operating revenue and expense is slighter. Mr. James detailed each of the Port’s operating lines providing the revenues and expenses for each. Please see the attached Power Point presentation for numerical details.
Commissioner Calhoun commented that Port expenses continue on pace at the log yard and asked why. Are they just fixed costs and materials? What are the other fixed costs? Mr. James responded that the fixed costs are 75-80 percent labor related and that Port staff has not been successful in shifting the costs. Commissioner Calhoun then asked how long the Port can tolerate the differences between costs and profit.
Commissioner McEntire expressed his desire to hear how the Port is going to increase productivity or decrease costs at the log yard during the budget cycle.
Commissioner Calhoun said that we cannot continue to absorb these costs and the Port needs to explore other options. Mr. James recommended that the Commission approach this topic before the budget. Commissioner Calhoun then asked if the new marketing position was included in the economic development or rental properties figures. Mr. James answered that the marketing person is budgeted in the economic development department.
Mr. James concluded by stating that the Port’s financial position shows a small decrease. He said staff would bring the Commissioners specific log yard information with instruction from Executive Director Robb. Commissioner McEntire said that if the log yard information was presented before budget time, it could influence the Port’s thought process during the budget.
VII. PUBLIC COMMENTS SESSION
No public comments.
VIII. ITEMS NOT ON THE AGENDA
None.
IX. NEXT MEETING – JUNE 14, 2010
X. EXECUTIVE SESSION
The Board of Commissioners moved into executive session at 12:22 p.m. to consider one property item, two litigation items and no items of personnel. These items are discussed in executive session in accordance with title 42.30.110 of the Revised Code of Washington. Commissioner Schoenfeldt estimated the executive session will conclude in approximately an hour and a half and that no action will be taken.
XI. ADJOURN
Commissioner Schoenfeldt reconvened the regular meeting at 2:05 p.m. and immediately adjourned with no action taken.
PORT OF PORT ANGELES
BOARD OF COMMISSIONERS
____________________________
George H. Schoenfeldt, President
__________________________
John M. Calhoun, Secretary
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