03 Feb Commission Meeting Minutes 1-9-23
PORT COMMISSION OF THE PORT OF EDMONDS , MINUTES OF REGULAR MEETING
(Via Zoom, Hybrid Meeting) January 9, 2023
Steve Johnston, President
Jim Orvis, Vice President
Jay Grant, Secretary
Bob McChesney, Executive Director
Brandon Baker, Director of Marina Operations
Tina Drennan, Manager of Finance and Accounting
Jordan Stephens, Port Attorney
CALL TO ORDER
President Johnston called the meeting to order at 7:00 p.m. and announced that the Commission would move to an Executive Session at the end of the meeting to discuss personnel matters.
All those in attendance participated in the Pledge of Allegiance to the American Flag.
COMMISSIONER PRESTON MOVED THAT THE CONSENT AGENDA BE APPROVED TO INCLUDE THE FOLLOWING ITEMS:
A. APPROVAL OF AGENDA
B. APPROVAL OF DECEMBER 12, 2022 MEETING MINUTES, AS SUBMITTED
C. APPROVAL OF PAYMENTS IN THE AMOUNT OF $893,810.25 FOR DECEMBER 21, 2022 AND $415,950.23 FOR JANUARY 9, 2023
D. AUTHORIZATION FOR EXECUTIVE DIRECTOR TO WRITE OFF $1,597.39 AND SEND ACCOUNT TO COLLECTIONS
E. APPROVAL OF WAIVER OF NOTICE OF SPECIAL MEETING
COMMISSIONER ORVIS SECONDED THE MOTION, WHICH CARRIED UNANIMOUSLY.
There were no public comments.
RESOLUTION NUMBER 23-01 – RECONFIRMING SCHEDULE AND LOCATION OF PORT OF EDMONDS COMMISSION MEETINGS
COMMISSIONER GRANT MOVED THAT THE COMMISSION APPROVE RESOLUTION NUMBER 23-01 RECONFIRMING THE SCHEDULE AND LOCATION OF THE PORT OF EDMONDS COMMISSION MEETINGS FOR 2023 PER THE ATTACHED SCHEDULE. COMMISSIONER ORVIS SECONDED THE MOTION.
It was noted that the location of the Commission meetings would change when the new Administration/Maintenance Building is completed.
Commissioner Harris asked if the Commission would be holding a retreat in 2023, and Commissioner Johnston confirmed that a retreat is currently being planned for sometime in late March. The focus of the retreat will be strategic planning.
THE MOTION CARRIED UNANIMOUSLY.
2023 COMMITTEE ASSIGNMENTS
Commissioner Johnston presented the 2023 Committee Assignments, which are based on discussions he had with Commissioners in an attempt to balance the workload.
COMMISSIONER HARRIS MOVED THE COMMISSION APPROVE THE 2023 COMMITTEE ASSIGNMENTS AS STATED IN THE COMMISSION MEETING, PORT OF EDMONDS 2023 COMMITTEE ASSIGNMENTS. COMMISSIONER ORVIS SECONDED THE MOTION, WHICH CARRIED UNANIMOUSLY.
2020-2021 AUDIT REPORTS
Mr. McChesney advised that Ms. Drennan was present to report on the results of the 2020-2021 State Audit. While there were some comments and suggestions, it was a clean audit with no exceptions.
Ms. Drennan reported that the Washington State Auditor’s Office completed the audit of the Port’s 2020 and 2021 financial statements and the accountability audit report was published on December 22, 2022. She advised that the Audit Committee (Commissioner Johnston, Commissioner Orvis, Mr. McChesney and Ms. Drennan) attended the Exit Conference on December 14, 2022, and the reports are attached to the Staff Report. She reviewed that there are three levels of audit recommendations: findings, management letters and exit items. The Port did not receive any findings, which are the most serious, or management letters. However, there were two exit items:
• Executive Sessions. There were two instances where the minutes for executive sessions did not state the specific ending time. Per the Open Public Meetings Act, executive sessions should announce the time the session will end, and announcing the length of time is insufficient.
• Journal Entry Secondary Review. In prior audits, it was noted the Finance Manager prepares and posts journal entries prior to providing them to the Executive Director for review. However, the audit found the Executive Director reviews journal entries without support for journal entry amounts unless specifically requested. While the Commissioners and Executive Director review quarterly financial reports and have accepted this risk, the auditor will continue to recommend the Port perform a secondary review of all journal entries using supporting documents.
Ms. Drennan observed that she isn’t sure how the Port could comply with this concern without having another accountant on staff. Commissioner Orvis noted that this exit item is a repeat of the previous audit. The auditors must raise this issue as part of the audit. However, they understand it would require an additional accountant on staff, which the Port does not need. In the past, the Commission has considered the risk to be less than the cost of compliance (hiring an additional accountant). Ms. Drennan recalled a previous audit also raised concern that staff at the marina and fuel dock do not have their own change drawers. The Commissioners agreed that the risk of having numerous change drawers would be higher than the risk that someone would walk away with cash undetected. Commissioner Orvis commented that Commissioners attending the arrival conference with the auditors should make it clear that the Commissioners understand and accept these risks. Mr. McChesney pointed that there have been no cash losses or incidents that would suggest a defect in the current controls.
In addition to the two exit items, Ms. Drennan advised that a few verbal recommendations were communicated directly to her:
• The Auditor’s Office expressed a concern about a possible weakness in one of the Port’s software programs, and Port staff is currently working with the software vendor to eliminate the weakness.
• The Auditor’s Office completed a cursory review of the Port’s procurement of architect and engineering contracts and recommended the Port develop procedures to ensure that future contracts comply with State laws. Port staff will work to develop these procedures in 2023.
• The Auditor’s Office recommended the Port implement written IT procedures. Staff is performing the work, but the procedures are not document. Staff will develop these procedures in 2023.
Ms. Drennan concluded her presentation by announcing that the financial and accountability reports are available on the State Auditor’s website and will be linked from the Port’s website, as well.
Commissioner Johnston thanked Ms. Drennan for continued excellence in managing the Port’s financials and completing another highly successful audit. He had the impression that the auditors were struggling to find comments. The Port runs a very tight ship thanks to Ms. Drennan, and the auditors fully acknowledged that.
Prior to the next audit, Commissioner Orvis suggested it is important for the Port to either take action on the items noted in the previous audit or provide documentation to support the decision to not take action. Commissioner Orvis referred to the auditor’s comment regarding architect and engineering contracts and pointed out that the North Seawall and Portwalk project started small and grew because of complications that were found later. Additional contracts were necessary to take care of things that were discovered after the initial contract was approved. He agreed with the auditor that the Port needs to have procedures in place to address evolving situations. Mr. McChesney reviewed that the Portwalk project was originally intended as aesthetic improvements to the public access, but the project became much more complicated following a condition survey. The Port ended up using an incremental approach to putting together the design and engineering team, and the auditors made note of that. There was nothing to suggest an egregious violation of State law, but the auditors want the Port to have a better policy in place going forward. Commissioner Johnston noted that the same thing happened with Harbor Square Building 3, as the project expanded when more problems were discovered as the work moved forward.
Commissioner Orvis concluded that it was a great audit, and the auditors left very confident the Port was doing things right. They complimented Ms. Drennan.
CITY OF EDMONDS REPORT
It was noted that the City Council would appoint a new Port Liaison at their January 10th meeting.
EXECUTIVE DIRECTOR’S REPORT
Mr. McChesney said there has been a lot of weather-related activity at the Port over the past several weeks. The intersection of State Route (SR-104) and Dayton Street flooded, which raises the question about the usefulness of the pump the City installed to address the recurring problem. Commissioner Grant said he raised this issue during the public comment period at a recent City Council meeting. After the meeting, Councilmember Teitzel informed him that he contacted the Public Works Director about the situation but hadn’t received a response. Mr. McChesney commented that the new pump hasn’t worked well since it was installed, and he looks forward to hearing the Public Works Director’s response. Commissioner Grant said he took pictures of the situation from Point Edwards and found it interesting how high the water was. Most interesting was where the water was from the marsh in relationship to where the new tracks will be located. Mr. McChesney noted that there is a depression on the railroad side of the fence that acts as a sump to relieve flooding at Harbor Square. Without that, the flooding would have been much worse. Commissioner Orvis added that during the previous major flood, water from the Burlington Northern Santa Fee site spilled into the Harbor Square parking lot.
Mr. McChesney reported that the elevator pit flooded again, but there appears to be an easy fix. He explained that the recent repair was designed with a sunken pit, but no pump was installed because they wanted to see if the fix actually worked. He explained that the contractor did everything per specification, but the hydrostatic pressure of the ground water is so strong that it overwhelms. Following approval from the Department of Labor and Industries (L&I), a sump pump will be installed to address the problem.
Mr. McChesney also reported that a tree fell down on a walkway next to the marsh, and the City has been notified to come and fix the problem.
Mr. McChesney advised that the dry system in Harbor Square Building 2 went wet and caused a problem on Christmas Eve. The problem was in the exterior under the soffits, so there was no interior damage to tenants. He noted that a yearly confidence test was done three weeks ago and the building passed. However, when the system was repressurized, they might not have got all the water out. Because the problem was on the outside of the building, the damage was minimal and mostly cosmetic.
Mr. McChesney commended the Marina Operations and Maintenance Staff for doing a great job keeping the Port safe during the freezing conditions. He explained that the Port learned the hard way that the water system on the docks must be blown out with a compressor when there are freezing conditions. This is a big job for staff to accomplish.
Mr. McChesney announced that he has invited a representative from Makers to present the architectural details of the North Portwalk and Seawall Project at the January 30th meeting. At that time, the Commissioners will be invited to provide feedback regarding the various design elements of the project. Commissioner Grant recalled that he previous asked the consultant to consider alternatives for the gates, and Mr. McChesney agreed that could be part of the discussion. Mr. McChesney said he is hopeful the Joint Aquatic Resource Permit Application (JARPA) will be approved by June. The final design must also be presented to the Edmonds Architectural Design Board for review and approval. In addition to permitting and design, the financing plan for the North Portwalk and Seawall must be perfected. It is hoped that grant funding will be a major component of the plan. Because it will be a big ask, it might be necessary for the Port to hire a lobbyist to help push grant applications forward. He suggested that this decision will need to be made soon, and a bid process will then follow.
Commissioner Johnston summarized that there were no short- or long-term damage created by the weather conditions over the past few weeks, and Mr. McChesney concurred. He said the situations that came up will be easy to rectify.
Commissioner Orvis asked where the water from the elevator shaft would be pumped to. Mr. McChesney said the intent is to pump it to the interior plumbing of the building. He explained that it wouldn’t be easy to tie into the City’s sanitary sewer, and the City would not likely issue a permit for that. However, they could tie it into the building’s existing drain system. He noted that L&I approval would be required.
Commissioner Grant asked if the Port has a more precise estimate for the total cost of the North Portwalk and Seawall Project. Mr. McChesney answered that the estimate still needs to be revised.
COMMISSIONER’S COMMENTS AND COMMITTEE REPORTS
Commissioner Grant said he attended the Regional Earthquake and Tsunami Communication Committee meeting where he suggested they put their plans on paper. Of their five meetings, communication was considered the Achilles heel. Communication systems almost always go down during emergency situations and agencies can’t talk to each other because they all have their own frequencies, etc. He has worked on this issue in his profession and one solution that stands out is social media. It was announced that the newer iPhones automatically switch to satellite, and this is something the Port might want to look into.
Commissioner Grant reported that he attended the last Edmonds City Council meeting which primarily focused on the Emergency Management Element of the Comprehensive Plan. While the document is still incomplete and some of the items are unrealistic, it is a good first step and the City now has a full-time safety manager.
Commissioner Grant said he was invited to speak at the Sunrise Senior Center. Fifteen people were in attendance and had good questions. One of their main requests was that the new North Portwalk be flat enough for them to walk safely, and he assured them it would be.
Commissioner Grant said he had a brief conversation with Eric ffitch, Washington Public Port Association (WPPA) Executive Director, on moving forward with the Cyber Task Force.
Commissioner Grant advised that he has been working diligently to identify potential grant opportunities for the North Portwalk and Seawall Project. He has talked to several lobbyist firms and received one quote for between $25,000 and $30,000 a month for a combination of grant and appropriations assistance. He explained that grant awards will depend on what the Port does and who the competition is. Because the project is large, the Port may have to compete against large cities. The Port is in a good position, as Senator Patti Murray is Chair of the Appropriations Committee, Senator Maria Cantwell is Chair of the Commerce Committee, Representative Rick Larsen is the ranking member of the House, and Representative Cathy McMorris Rodgers is Chair of the Energy and Commerce Committee. This suggests the Port has some reasonable expectations, but a lot of the work is done by staff and it is all about relationships and getting information in front of them. He expressed his belief that the Port’s chance of receiving grant funding would significantly improve if they hired a firm to assist. The fact that the project really needs to be done will put the Port in a good position, but the competition will be stiff.
Commissioner Orvis asked if the Commission should also budget for a lobbyist to actually go to Washington D.C. Commissioner Grant said the contract would likely include fees for a firm (grant writer, lobbyist, etc.), a congressional directory, and various expenses. He estimated the cost could be as high as $400,000 depending on the firm and the requirements outlined in the statement of work. Commissioner Grant shared some insight about the two paths of funding: direct appropriations and specific grant venues. He explained that, in addition to the Port speaking with local representatives and members of the various committees, it is also important to educate the administrative people involved in decision making. The goal is to educate not only the various committee members, but also the staff who serve them. They must also identify what is being highlighted by each of the committees for the year. He emphasized the need to hire a firm soon, as the congressional committees are currently being formed.
The Commissioners expressed a desire to take action on a contract by the end of the month, if not sooner. Ms. Drennan advised that the Port would need to issue a Request for Proposals, and the Commission asked staff to work with Commissioner Grant to prepare a list of specifications and criteria so that the request could be issued as soon as possible. Commissioner Grant agreed to contact various ports, including the Ports of Everett and Seattle for recommendations, and it was also recommended that they solicit recommendations from the WPPA. The Finance Committee agreed to meet before the next meeting to discuss potential changes to the 2023 budget to incorporate this significant expenditure.
Commissioner Preston announced that he would attend meetings of the Economic Alliance of Snohomish County (EASC) and Downtown Edmonds Merchants Association (DEMA) on Thursday. He said he is looking forward to attending the upcoming Seattle Boatshow the first week of February.
Commissioner Orvis referred to Commissioner Grant’s earlier comment regarding communication during emergencies. He observed that, historically, communication fails when put under stress because programs are underfunded and people are undertrained.
Once again, Commissioner Orvis commended Ms. Drennan on a successful 2020-2021 audit. The auditors were pleased that everything went well. He suggested they should announce the successful audit to the public.
Commissioner Preston said he was part of the Emergency Services Coordinating Agency (ESCA) that was dissolved about seven years ago. The Department of Emergency Management of Snohomish County was supposed to take over ham radio operations, but nothing has been done. Commissioner Grant recalled that at an event last summer sponsored by the City’s Safety Manager, there was some discussion by local ham operators. He suggested they raise this issue with the Edmonds Safety Manager.
Commissioner Johnston thanked Commissioner Preston for his service as Commission President on 2022 and said he is happy to serve the Commissioners as president in 2023. He reported that he attended the audit exit conference on December 14th, which went well. He also participated as a judge for the 2022 American Council of Engineering Companies (ACEC) Engineering and Environmental Excellence Awards. There was only slight participation from public ports this time. He suggested the Port’s upcoming North Portwalk and Seawall Project might be a good candidate for the award.
Commissioner Johnston said he participated in the ESCA’s January 3rd Coffee Chat that focused on community engaged learning and research opportunities. The discussion focused on the University of Washington Bothell’s attempts to provide educational programs leading to internships and didn’t have a lot of relevance to ports.
At 8:03 p.m., Port Attorney Stephens announced that the Commission would move into Executive Session pursuant to RCW 42.30.110(1)(g) to review the performance of a public employee. The Executive Session would last 20 minutes and conclude at 8:23 p.m. At the conclusion, the Commission would adjourn the meeting with no related announcements or actions taken.
The Commission meeting was adjourned at 8:23 p.m. with no related announcements or actions taken.
Jay Grant, Port Commission Secretary