07 Oct Commission Meeting Minutes 9-9-2019
PORT COMMISSION OF THE PORT OF EDMONDS MINUTES OF REGULAR MEETING September 9, 2019
COMMISSIONERS PRESENT
Jim Orvis, Vice President
Angela Harris, Secretary
Bruce Faires
David Preston
COMMISSIONERS ABSENT
Steve Johnston, President (excused)
STAFF PRESENT
Bob McChesney, Executive Director
Marla Kempf, Deputy Director
Tina Drennan, Finance Manager
Brittany Williams, Properties and Marketing Manager
OTHERS PRESENT
Bradford Cattle, Port Attorney
CALL TO ORDER
Vice President Orvis called the meeting to order at 7:00 p.m.
PLEDGE OF ALLEGIANCE
All those in attendance participated in the Pledge of Allegiance to the American Flag.
CONSENT AGENDA
COMMISSIONER FAIRES MOVED THAT THE CONSENT AGENDA BE APPROVED TO INCLUDE THE FOLLOWING ITEMS:
A. APPROVAL OF AGENDA
B. APPROVAL OF AUGUST 26, 2019 MEETING MINUTES AS AMENDED
C. APPROVAL OF PAYMENTS IN THE AMOUNT OF $490,417.91
COMMISSIONER PRESTON SECONDED THE MOTION, WHICH CARRIED UNANIMOUSLY.
PUBLIC COMMENTS
Denise Miller, Edmonds Neighborhood Action Coalition, reported that last night was the Coalition’s Candidate Meet and Greet, with over 100 people in attendance. She thanked Commissioners Orvis and Preston for attending the event as candidates, even though they are running unopposed. She advised that, at the event, Teresa Whipple, My Edmonds News, asked her to report on Port Commission Meetings moving forward.
Commissioner Preston thanked the Coalition for sponsoring the event. He commented that he particularly liked the format, which allowed each candidate three minutes to comment. Commissioner Orvis commented that he appreciated the neutral venue, where every candidate had an opportunity to speak and then converse with those present.
DRY STORAGE PROPOSED RATE STRUCTURE
Ms. Kempf reviewed that the current Dry Storage Facility was built in 1998, and the two Minuteman Launchers were installed at that time. The facility has always been characteristically seasonal, with greater demand during the peak months of May through September, and lesser demand during the shoulder season of October through April. The facility is a very high-service, labor-intensive and equipment-dependent program, which has made it challenging to achieve a positive bottom line. The forklifts accommodate between 11,000 and 13,000 boat moves each year, with about 6,600 of those during the peak season. The boats served in this sector are less than 32 feet and trailer-able, providing the customers with options for reducing their boat-related expenses during times when they aren’t actively fishing or using the boats. Financial occupancy in Dry Storage at the close of 2018 was 88%.
Ms. Kempf further reviewed that, in January 2018, staff introduced some modified dock-area and wash-down procedures in response to customer feedback received during 2017 and previous peak seasons. An overview of Dry Storage peak season challenges and 2018 modified guidelines for pre-launch, return and overnight in-water moorage areas, and wash down protocols were reviewed with the Commission and subsequently implemented. For two seasons now, the Dry Storage team has been employing these new dock protocols and customer feedback has, for the most part, been very good. While they still experience some congestion on the docks and in the wash down areas when activity levels are high, the revised dock protocols have allowed the Port to meet the needs of a wider variety of users.
Ms. Kempf explained that the Dry Storage Facility serves two types of customers: year-a-round and seasonal. The year-a-round customers represent about 70% of the current customer base, and some are more active than others (high users, average users, and low users). On average, seasonal customers (between 30 and 40 each season) store their boats and sometimes trailers at the Port from May through October. Some tend to be high users (twice or more per week), and they take full advantage of the wash area and dock space, too. This sometimes makes it more difficult for the year-a-round customers to use these areas, and the seasonal customers get more than their money’s worth in service.
Ms. Kempf explained that some sectors of the Port’s business depend upon high activity to produce positive bottom lines. Alternatively, Dry Storage produces the most positive bottom line from customers that are low activity. The Port’s marketing plan identifies the ideal dry storage customer as being a low user that stays year-a-round. Recognizing this is the case, it is still the Port’s mission to achieve customer satisfaction with every customer served.
Ms. Kempf advised that the Port has begun to improve the customer experience and financial picture through expense reductions, program changes and restructured rate schedules. Although expenses within the Port’s management control have been reduced, there are some they do not have control over that continue to rise. These include things such as utilities, insurance and fuel. Revenues from dry storage have increased by an average of 1.43% for the past 10 years, whereas operating expenses have increased by an average of 2.6%. She referred to the historical financial performance numbers that were provided in the Staff Report, which show that bottom-line revenues and net income have steadily increased. Until 2013, the Dry Storage Facility operated in the negative.
Ms. Kempf commented that the Port has continued its commitment to quality, service, value and convenience by investments in maintaining and improving the racks, the launchers, the dock return and pre-launch areas, and the forklifts. She referred to the table provided in the Staff Report, outlining the investments that have been made to the facility every year since 2009. The most recent investment was the new Wiggins Forklift that cost about $360,000.
Ms. Kempf said the Port has always kept records of every move made by the forklifts. Rather than charging for each individual move, the Port has charged a monthly rate based upon size of boat to all dry storage customers. The chart provided in the Staff Report shows the current rate structure. She noted that the rates are different during off season than they are in peak season.
In a continuous quest to retain customers while covering the high cost of operating the dry storage facility, Ms. Kempf reported that Port staff further explored the low, average and high-user activity. The results are provided in the table attached to the Staff Report. In summary, of the 230 spaces in dry storage, 80 had over 20 moves per month during the 5-month period (May through September) for an average of 24.35 moves each. The highest user had 41 moves per month. The high user is paying the same rate as everyone else, but costing the Port much more and essentially being subsidized by the other dry storage customers. Many of the high users request unnecessary moves, as well. Rather than raising everyone’s rates to pay for the cost of high users, staff is proposing a reasonable and equitable solution. The rate for Dry Storage would remain on schedule with Commission approved increases for 2020, and a maximum number of 21 moves per month would be included in the base rate. There would be a $25 charge for every move over 21. This should improve the Port’s margin and customer experience in several ways:
1. It will encourage users to eliminate unnecessary moves, which equals cost savings.
2. It will enable customers to consider whether dry storage is the best option for them or if water moorage would serve their needs better.
3. It will make rates more equitable for all customers.
4. It will assist with defraying the costs generated by the highest users.
5. It may result in a reduction in total moves, which could improve the Port’s ability to achieve customer satisfaction with available wash down space, in-water dock space and move times.
Ms. Kempf proposed that the new program be implemented on January 1, 2020. This will allow time for staff to communicate with Dry Storage customers and give them the option of moving to water moorage during a time of year when there is usually availability. It also may allow them to participate in the 2020 Boat Show special for in-water moorage if they are seasonal customers who traditionally terminate prior to December 1st each year.
Ms. Kempf said it is hard to identify the fiscal impact of the proposed change. However, the estimated change to revenue ranges from an additional $2,000 per year to a reduction in occupancy if some tenants move out of Dry Storage and into the water or to another facility. There will be no additional cost associated with implementation. If the number of annual moves is reduced, the Port may experience some indefinable savings through reduced wear and tear on the equipment.
Ms. Kempf summarized that the proposed change fits within the Port’s strategic purpose of being a responsible financial steward by operating marina facilities to be fully self-funded. In addition, it strives to fulfill the Port’s purpose of providing quality, service, value and convenience to all customers in a fair and equitable manner. She recommended the Commission approve the rate restructuring for Dry Storage to be effective January 1, 2020. If approved, the base monthly rate for Dry Storage would include 21 forklift moves per month instead of the existing unlimited moves. There would be an additional fee of $25 per move for every move in excess of 21 each month. Approval of the change would allow the Finance Manager to include the new rate structure in the 2020 Operating Budget.
COMMMISSIONER FAIRES MOVED THAT THE COMMISSON APPROVE A RATE STRUCTURE FOR DRY STORAGE EFFECTIVE JANUARY 1, 2020. THE COMMISSION-APPROVED BASE MONTHLY RATE FOR DRY STORAGE WILL INCLUDE 21 FORKLIFT MOVES PER MONTH. THERE WILL BE AN ADDITIONAL FEE OF $25.00 PER MOVE FOR EVERY MOVE IN EXCESS OF 21 EACH MONTH. COMMISSIONER HARRIS SECONDED THE MOTION.
Commissioner Faires said he understands the proposed change and felt it made sense because he believes in the fundamental strategy of cost following usage. However, he asked if staff considered freezing the 2020 rates to the 2019 level and putting in place the additional cost for moves in excess of 21. Freezing the rates would cost between $20,000 and $25,000 a year, but it would demonstrate that the change is less about money and more to demonstrate that cost follows usage. Ms. Kempf said she did not consider that option, since the Commission is responsible for approving rate increases. She recalled that the Cash Flow Model identifies the proposed 2020 rate increases. She focused more on operations and the large number of moves that some tenants have requested. The goal is to create some equity so the people who use Dry Storage in a limited way do not have to subsidize the high users.
Commissioner Preston said he appreciates that high users create more wear and tear on the equipment. The proposed change might result in overall better service to the low and average users by restricting the moves for high users. However, it could result in a significant increase to the high users ($200 to $300 more per month). He noted that a similar approach was used by the water utility. While the base rate was not increased, the amount of water used over the base amount was charged at a higher rate. Water rates doubled for many customers. He predicted that a few tenants will be extremely angry about the change. Ms. Kempf responded that the Port would like to encourage the few who fall into the high-use category to put their boats in water moorage, instead.
Commissioner Preston suggested that another option would be to implement the proposed change, but also establish a higher-rate new category for unlimited moves. This would give the tenants a choice. Mr. McChesney said staff researched other dry storage facilities and found that some charge a premium rate for unlimited moves. However, staff believes the fair approach would be to cap the number of moves per month and have a surcharge for any additional moves.
Ms. Kempf referred to the survey of other dry storage facilities that was attached to the Staff Report. She summarized that all of the facilities within the range of the Port of Edmonds are privately owned and operated. They are all heated buildings and indoor storage, so their rates are somewhat higher.
Commissioner Harris suggested that it might be difficult to manage the tiered approach suggested by Commissioner Preston. She commented that the proposed change is less about money and more about equitable service and allowing everyone to have equal access. Ms. Kempf said the Port has the ability to track each move and identify when someone goes beyond 21 moves. However, implementing different tiered rates would complicate staff’s ability to track and manage without investing in an automated system.
Commissioner Preston asked if it would be possible to offer the high users a better-than-boat show deal on their first few months of in-water moorage. Perhaps some of their angst could be managed by providing some special incentive for them to move into water moorage. Ms. Drennan advised that the boat show deal is $20.20 rates for the 1st and 12th months.
Commissioner Orvis observed that Dry Storage tenants also get overnight moorage. Ms. Kempf said they get one free night of guest moorage per week. Commissioner Orvis pointed out that tenants could reduce the number of moves by leaving their boats in the water overnight one time each week. He said he was initially worried that the proposed change would drive tenants out of Dry Storage, but it would really only affect tenants who want to put their boats in the water every day and pull them out every night and wash them. Ms. Kempf pointed out that some tenants move their boats from the racks to the wash down area to load things from their cars onto their boats, but this could be done while the boats are moored on the dock, instead. When the system was thought up, the idea of a free launch every day meant going from the rack to the water, but it has turned into going from the rack to the wash down area, from the wash down area to the water, from the water back to the wash down, and then back onto the rack (4 moves instead of 2 moves). Staff would like to get people to think about making fewer moves. Unnecessary moves cause wear and tear on the equipment.
Commissioner Preston asked how often staff moves boats from the rack to the washdown area, and Ms. Kempf said she can’t answer that specifically. Commissioner Preston asked if it is possible that a tenant would be unable to get guest moorage space at night. Ms. Kempf answered that the in-water space is limited, and that’s why they opened up V- Dock for Dry Storage overflow during peak times. Commissioner Preston asked how much it costs for a 24-foot boat to be in guest moorage for an extra night, and Ms. Kempf answered $36. Commissioner Preston said the new rate structure could encourage people to take second and third nights in guest moorage instead of paying for four moves. Ms. Kempf said some Dry Storage tenants put their boats in loan-a-slip during particularly busy times.
Commissioner Preston asked if staff has considered potential repercussions where there might be some unforeseen overuse and/or abuse. Ms. Kempf answered that people who are moving their boats 41 times each month will have to consider whether they want to go into water moorage at the Port or move to another dry storage facility. Mr. McChesney said he foresees that some tenants will see the change as a diminution of their value. They are used to having unlimited moves, and they think that is part of their value proposition. Commissioner Faires commented that the majority of customers will benefit by no longer having to subsidize the people who move their boats a lot.
Commissioner Orvis observed that implementing the proposed change would not result in significant revenue to the Port. On the other hand, freezing the 2020 rates at the 2019 level will result in a significant loss of revenue. He said he doesn’t support freezing the rates. The proposed change is a means whereby the Port can increase the equitability of the rate structure and control costs and wear and tear on equipment. If the Port continues to allow unlimited moves, the rates will eventually have to be raised at a faster rate as equipment wears out. He said he supports the proposed change.
Commissioner Preston pointed out that Ms. Williams could communicate the change in such a manner that most of the Dry Storage tenants will be excited about it.
THE MOTION CARRIED UNANIMOUSLY.
HARBOR SQUARE BUILDING 3 – RESTORATION ENGINEERING CONTRACT
Mr. McChesney explained that, after the initial investigation into possible building structural defects caused by prolonged water intrusion from cracked stucco exterior cladding and worn out window seals, as reported at the July 29th Commission meeting, the cause and issues have, for the most part, been identified. Phase 2 of the project will have two components. The structural problems are being addressed by CG Engineering under a separate contract authorized by the Commission on August 26th, and the building exterior envelope issues will be resolved by a secondary contract with Building Envelope Engineering (BEE) as anticipated. Once completed, both work products will be consolidated into one package for the purpose of permitting, bidding and construction.
Mr. McChesney recommended the Commission authorize him to enter into a contract with BEE Consulting Engineers in the amount of $33,350.00 to provide plans, specifications, bid documents and construction-related services to correct building exterior envelope renovations.
Commissioner Faires asked Mr. McChesney to review the activities that resulted in the contract. Mr. McChesney said the genesis of the situation was some observed cracking inside the building and some apparent water damage that could be seen from the outside. BEE conducted the initial evaluation and found dry rot in the structural members. BEE recommended the Port hire a structural engineer to attend to the structural issues. Now there are two consulting engineers working on the same building. BEE (a tenant of the Port) was expedient and appeared to be the most cost-effective way to address the problem without going through an arduous selection process. The staff and Commission felt there was some urgency in trying to discover what the problems were, and BEE was selected to do the initial investigation. Commissioner Faires said it is important to be sure the Port is on firm legal ground with the sole source the contract. Mr. Cattle responded that it is a professional service contract at a level that would not be an issue.
Mr. McChesney summarized that the ultimate goal is to combine the structural plans and specs with the building envelope plans and specs and go out to bid for a general contractor to complete the work.
Commissioner Orvis asked if staff anticipates that one of the two engineering consultants would oversee the project once a general contractor has been selected. Mr. McChesney said that has not been determined at this stage. There is still some discovery needed, but he would anticipate the Port would want to have an on-site project engineer.
COMMISSIONER HARRIS MOVED THAT THE COMMISSION AUTHORIZE THE EXECUTIVE DIRECTOR TO ENTER INTO A CONTRACT WITH BEE CONSULTING ENGINEERS TO PROVIDE PLANS, SPECIFICATIONS, BID DOCUMENTS AND CONSTRUCTION-RELATED SERVICES FOR HARBOR SQUARE BUILDING 3 EXTERIOR ENVELOPE RENOVATIONS IN THE AMOUNT NOT TO EXCEED $33,350.00. COMMISSIONER FAIRES SECONDED THE MOTION, WHICH CARRIED UNANIMOUSLY.
MID-MARINA BREAKWATER CONDITION ASSESSMENT
Mr. McChesney recalled that the Commission approved a contract with PND Engineering to do a condition survey of the Mid-Marina Breakwater in May of 2019. PND conducted field investigation on June 20th, and their summary conclusions are very similar to the condition survey performed by Berger/ABAM Consulting Engineers in 2003. He noted that a copy of PND Engineering’s report was included in the Staff Report. He summarized that the report indicates that the timber members of the breakwater in the tidal influence zone have been deteriorating and at some locations breaking, creating holes in the breakwater face. They found the top of rip-rap elevations on both sides of the wall to vary significantly from Berger/ABAM’s previous inspection report in 2003. The average top of the rip-rap at the time of PND’s inspection was approximately +7 feet on the front side and + 5 feet on the backside. Both of these elevations are 3 feet below the elevations that were shown in the previous inspection report.
Mr. McChesney advised that the repair alternatives assume the steel H-beam batter piles are sound and in good condition, but that is yet to determined. PND Engineers has recommended three options:
• Option-1/1A. Replace all of the wooden members with either new treated timbers or plastic lumber (composite). These options will require temporarily moving existing rip-rap on both sides down to below the lowest course of wood. The estimated cost for Option 1 (timbers) is $361,000 and the estimated cost for Option 1A (composite) is $394,000.
• Option 2. Leave the existing timber members in place and replace only the damaged ones that can be more easily accessed. Add a new array of treated timber members to the exposed back side of the breakwater from elevations +3 feet to +8 feet. This option also requires temporary removal of 1 to 2 feet of rip-rap. The estimated cost of this option is $104,000.
• Option 3. Remove all of the timber members and replace the breakwater face with precast concrete panels inserted between the existing H-pile sections. The estimated cost of this option is $663,000.
Mr. McChesney explained that since the Port has already done these repairs before and replacing timber is no doubt the cheapest method, it is now apparent that durability and cost effectiveness of the repairs are in question. Consequently, from the perspective of staff and PND Engineers, the most economical repairs would suggest Option 3 using pre-cast concrete panels to replace the timbers may be the best solution.
Mr. McChesney said he met earlier in the day with PND Engineering and discussed that the key assumption is the overall condition of the existing steel H-beam batter piles. PND believes they are structurally sound and whether there is sufficient remaining life to avoid major repairs or replacement is unconfirmed at this time. He asked PND Engineering to do a lifecycle analysis to confirm this initial supposition. It makes no sense to do an expensive repair with pre-cast concrete that is going to outlive the H-beam steel batter piles.
Mr. McChesney summarized that the next steps will be finalizing the specifications, permitting and bid/construction drawings. Because the project will not be considered new construction, he expects permitting will be authorized under a Corps of Engineers Nationwide Permit for maintenance, without Endangered Species Act consultation review. Obtaining the necessary permits is anticipated to take up to a year, with construction to begin in the winter of 2020/21 at the earliest. The intent is to continue to gather information to elevate staff’s confidence that the recommendation is the best. He will report back to the Commission before proceeding to the next step.
Commissioner Faires said he believes the analysis of the breakwater was done competently and in detail. He supports the answers in the report, which vary between Options 2 and 3. However, none of the options address the condition of the H-beam batter piles, and he cannot make a decision without this information. He supports staff’s current process, which is aimed at learning how long the H-beam batter piles will last. Mr. McChesney commented that this question should be answered fairly quickly because they have had an ongoing corrosion maintenance program for many years and the data will show how advanced the corrosion is. From that, they can impute how much more life the steel has.
Commissioner Orvis said that whatever option is selected must include removal of the existing creosote boards. Unless the H-beam piles are in bad shape, they won’t be replacing the entire breakwater. Also, when a barge or crane is brought in to do the project, they might want to consider pulling the creosote piles by the fire boat out, as well. They were chopped off but left there because it wasn’t worth the staging to pull them out. Lastly, they need to consider weather and the position of the dock because a big northwesterly storm during construction could be disastrous. Mr. McChesney advised that will be part of the permitting process. In-water work can only be done when the fish window is open. He doesn’t know exactly what that window is, as it changes every year. He agreed that the creosote pilings should be removed, and could even be used for project mitigation.
SPOTLIGHT SEATAC AIRPORT ADVERTISING PROGRAM
Ms. Williams advised that the Economic Development Department of the Port of Seattle launched a program called Spotlight Sea-Tac Airport in 2017. The Port recently applied to be a part of the program and was accepted for a Quarter 1 2020 slot. She explained that the program reserves 12 advertising locations at the Sea-Tac Airport on a quarterly basis for cities, counties, port authorities and non-profit organizations throughout the State to advertise their region or destination to travelers. Under the program, the Port of Seattle will cover the cost of reserving the advertising location. Those selected for the program will pay for production and installation of the ad. The program offers significant savings over the typical cost of advertising at Sea-Tac, which is approximately $5,000 to $10,000 per month for each space. The available 12 sign locations are located throughout the airport, including all concourses and baggage claim. With 50 million passengers coming through the airport annually, the program provides a unique opportunity to share with visitors the best the region and state has to offer.
Ms. Williams announced that the Port would be advertising in the C Concourse from January through March 2020. They will have a single-sided, back-lit diorama that is 62” by 43”. The Port will use the ad to feature the Port of Edmonds as an authentic Pacific Northwest seaside destination for travelers to the area and to remind locals that Edmonds is a great day trip opportunity. The ad will showcase the Edmonds Marina, with its boardwalks, seaside dining and opportunities for whale watching, scuba diving and fishing. The cost for printing and installing the ad will be about $750. She summarized that Sea-Tac is the 8th busiest airport in the country, serving over 31 airlines, and this will be a great opportunity for increased visibility.
Commissioner Faires asked if there is an opportunity for continuing the ad beyond Quarter 1. Ms. Williams answered that the Port of Seattle is currently establishing rules that will allow the ads to be up for two quarters in a row. They can see how it goes before making a decision to continue. Perhaps they can reuse their same ad and just pay for the install again. She commented that it is not such a bad thing to advertise during the slow season because the fishing charters, boardwalk and restaurants are available year-round.
Commissioner Faires asked if Puget Sound Express would be willing to share the cost of continuing the ad after Quarter 1. Ms. Williams said staff has discussed the idea of featuring different businesses and how that might help handle the associated costs. She would need to look into this option to see if it would even be allowed under the program. Perhaps they could discuss the option at a later date.
EXECUTIVE DIRECTOR’S REPORT
Mr. McChesney reported that he met with Pete Hanke from Puget Sound Express (PSE) last week. Mr. Hanke had very good comments about their 2019 operations and indicated his intent to continue with Edmonds being their base of operation. They discussed the vacant parcel, which is still open for discussion. The Port will have the land appraised in an as is/where is condition, so that PSE has a baseline to start with. The cost of the appraisal will be shared equally by the Port and PSE.
Mr. McChesney announced that there were some delivery issues with the Wiggins Forklift. The Port claimed back to Wiggins for some cost recovery and are satisfied with the results. They were very responsive, and Port staff is very happy with the equipment.
Mr. McChesney announced that the new travelift is on order, and staff is very much looking forward to its delivery. Commissioner Faires asked if there is any new information as to an estimated delivery date, and Mr. McChesney answered they are talking about the end of November.
Ms. Kempf reported that the Edmonds Coho Derby took place over the past weekend. There was not an excessive number of launches, but there was good activity at the marina. About 700 tickets were sold, and the largest fish winner was Eric Peterson with 8.75 pounds. For the kids, the largest fish was 5.72 pounds. There were 147 fish weighed in.
COMMISSIONER’S COMMENTS AND COMMITTEE REPORTS
Commissioner Faires observed that a lot of people use the waterfront for walking, and the view and waterfront activities. He said he suggested to Mr. McChesney that the Port use tags in the landscape areas to identify the types of plants, but he learned that people often take the tags home with them.
Commissioner Preston announced that he would not attend the Public Officials Reception on October 23rd because the Washington Public Port Association’s (WPPA) Small Ports Seminar is the next morning. Commissioner Orvis indicated he might cancel his attendance at the reception, too.
Commissioner Harris reported that Pete Hanke, Puget Sound Express (PSE) reached out to advise that he is going out on the Saratoga on Wednesday with the State Senate Agriculture and Natural Resources Committee. Both she and Commissioner Johnston have been invited to participate. She also announced that Birdfest is this weekend.
Commissioner Harris announced that she would attend an Edmonds Rotary Club meeting next week with Mr. McChesney, as well as the Edmonds Yacht Club’s meeting in a few weeks. She also plans to attend the WPPA Environmental Seminar.
Commissioner Faires said he was at the marina on Sunday when PSE’s vessel, the Saratoga came in. There must have been 70 people on the boat. It appears they are having a very successful season, which is great. Whale watching out of Edmonds appears to be working for them.
Commissioner Orvis reported that he and Mr. McChesney attended the WPPA Legislative Committee meeting where hear learned the following:
• Not much will happen with the Model Toxic Control Tax (MTCA).
• Initiative 976 would be a transportation disaster, but the WPPA believes the initiative has a good chance of passing. Passage would impact a large number of transportation projects, including $700,000 to the City of Edmonds.
• The Port of Benton was talking about a new tenant coming in who would like the port to build a building and they would make up the cost in rent. Because of the prevailing wage laws, the port can build a building for $3,000,000 dollars and the tenant can build it for $750,000. This is a significant problem for all ports, but particularly for those on the east side of the state that are having to pay Seattle/King County prevailing wages in order to do a public project. The law will also impact cities, school districts and other public entities that don’t have the ability to do work in house.
• There doesn’t seem to be any traction on trying to find a way to establish rules for greenhouse gas emissions as part of State Environmental Policy Act (SEPA) review.
• The Orca Recovery Task Force is trying to decide what their next task should be or if the group should be disbanded.
• The Ruckleshaus Roadmap Study calls for ports to be required to plan under the Growth Management Act (GMA). It also includes a recommendation to overhaul the SEPA rules.
Commissioner Faires questioned how the legislature could reconcile ports’ requirements relative to GMA with the still possibly-litigated prohibition for ports to engage in residential development. It makes no sense at all. Commissioner Orvis said the City has established a Housing Task Force to work on housing issues. He noted that Oregon has now passed a law that you cannot restrict multifamily housing in residential areas. At a minimum, duplexes are allowed in single-family residential zones.
Denise Miller explained that the Ruckelshaus Roadmap Study consists of four volumes that vary in content. She agreed to research the report and identify the policies that pertain to ports and report back to the Commission.
Commissioner Orvis reported on his attendance at the Economic Alliance of Snohomish County (EASC) Board Meeting:
• Dr. Daria J. Willis was introduced as the new president of Everett Community College.
• They talked about the funding impacts associated with Initiative 976, such as a $4 billion reduction in funding for highway safety, state patrol, ferry improvements, and transit projects. The biggest reason the initiative has a possibility of passing in King County is the Regional Transit Authority tax and the inflated evaluation of automobiles, which has been a problem since 1996 but has never been addressed by the legislature. The consequences of the initiative are significant. Even if you are adamantly against expensive car tabs, they fund so many things that it will hurt badly if the initiative passes. The EASC Board voted to oppose Initiative 976.
• There is an initiative to oppose a rule by Labor and Industries, which would require any salaried employee making less than $80,000 per year to be paid overtime for any work in excess of 40 hours. If passed, 250,000 employees who are presently salaried would no longer meet the requirement for salaried employment. The initiative would cover just about every industry and occupation, particularly service-oriented occupations, in the state.
• Brian McGowan, the CEO of Greater Seattle Partners, provided a briefing of the organization’s activities. The group is about a year old, and they are still working to get their feet on the ground. The biggest surprise he found is how much time he is spending in Snohomish County.
• There was a private, invitational briefing on United States/China relations, presented by Norwell Coquillard, Executive Director of Washington State/China Relations Council; Nelson Dong, an International Trade and International Security Attorney from Dorsey and Whitney; and Gary Locke. Mr. Dong spoke extensively about China’s territorial and sea aspirations, noting that China is now claiming the entire South China Sea. They are concerned about the effect of the China/United States trade disputes, and even Gary Locke acknowledged they were needed. However, he had some solutions that were different than those of the current administration. Mr. Dong advised that Washington is the most trade-dependent state in the country. In addition to agricultural products, about 75% of Boeing’s airplanes now go to China. Washington State is more vulnerable than most other states.
ADJOURNMENT
The Commission meeting was adjourned at 8:20 p.m.
Respectfully submitted,
Jim Orvis, Port Commission Vice-President signed for Angela Harris, Port Commission Secretary