28 Apr Commission Meeting Minutes 4-12-21
PORT COMMISSION OF THE PORT OF EDMONDS MINUTES OF REGULAR MEETING
(Via Zoom) April 12, 2021 7pm
COMMISSIONERS PRESENT
Angela Harris, President
David Preston, Vice President
Steve Johnston, Secretary
Bruce Faires
Jim Orvis
STAFF PRESENT
Bob McChesney, Executive Director
Brandon Baker, Marina Manager
Tina Drennan, Finance Manager
Brittany Williams, Manager of Properties and Marketing
OTHERS PRESENT
Bradford Cattle, Port Attorney
CALL TO ORDER
President Harris 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 MARCH 29, 2021 MEETING MINUTES, AS SUBMITTED
C. APPROVAL OF PAYMENTS IN THE AMOUNT OF $269,020.34
COMMISSIONER JOHNSTON SECONDED THE MOTION, WHICH CARRIED UNANIMOUSLY.
PUBLIC COMMENTS
There were no public comments.
HARBOR SQUARE 2021 HVAC REPLACEMENT CONTRACT #2021-375
Mr. McChesney briefly reviewed the Port’s replacement schedule for the HVAC units at Harbor Square. He advised that $120,000 was allocated for the project in the 2021 budget, and the project was bid on March 19th for four units on Building 2 and eight units on Building 5. A pre-bid walkthrough for the project was done on March 5th, with four prospective contractors in attendance, but only two qualified bids were received on April 7th. The low bidder was D.K. Systems for $156,050. Staff will work with the contractor to minimize any disruptions to tenants, and he anticipates the job will be completed by July 16th. He referred to the bid tabulation that was attached to the Staff Report, noting that D.K. Systems’ bid was about $100,000 less than the bid from D.B. Solutions. He explained that the higher than anticipated bids were due to cost escalations over the past year. He recommended the Commission authorize him to enter into a contract with D.K. Systems, Inc. in the amount of $156,050 plus sales tax for the base bid for Harbor Square 2021 HVAC Contract 2021-375.
Commissioner Preston asked how many HVAC units would still need to be replaced after the proposed contract is completed. Ms. Drennan answered that the original intent was that half of the 15 remaining units would be replaced in 2021 and the other half in 2022. However, there was some miscommunication, and the current proposal would replace 12 units. That means there would be three left to replace in 2022.
Commissioner Preston asked if county and state projects are required to pay sales tax, too. Ms. Drennan replied that she doesn’t know about the state, but counties are required to pay sales tax.
COMMISSIONER ORVIS MOVED THE COMMISSION AUTHORIZE THE EXECUTIVE DIRECTOR TO ENTER INTO A CONTRACT WITH D.K. SYSTEMS, INC. IN THE AMOUNT OF $156,050 PLUS SALES TAX FOR THE BASE BID FOR THE HARBOR SQUARE 2021 HVAC CONTRACT 2021-375. COMMISSIONER FAIRES SECONDED THE MOTION, WHICH CARRIED UNANIMOUSLY.
CONTINUATION OF RESOLUTION NO. 20-03 DECLARING LOCAL EMERGENCY AND DELEGATION OF AUTHORITY
Mr. McChesney reported that he has taken no action under the temporary emergency authority granted by Resolution 20-03.
MARINA RULES AND REGULATIONS UPDATE
Mr. Baker advised that staff is proposing amendments to the published Port of Edmonds Rules and Regulations to address prevalent issues and create more transparent standards for marina patrons. He reviewed the proposed amendments as follows:
• Section 10 – Unauthorized Businesses. The proposed amendment clarifies that the Port does not permit user-to-user boat sharing or rentals or short-term and long-term hospitality or housing rental.
• Section 6.7.1 – Dock Accessories and Gears. This amendment clarifies that the Port prohibits vessel storage devices, such as boat lifts or hull protection apparatuses, in the slips.
• Section 4.3 – Liability Insurance. This amendment clarifies that tenants are required to maintain liability insurance of $500,000 on all vessels and/or items stored in leased spaces at the Port. The Port has required this for years, but it was never written into the regulations.
Commissioner Orvis referred to the proposed amendment to Section 6.7.1 and voiced concern that “hull protection” could be interpreted to include fenders. Mr. Baker explained that the product that spurred this amendment is called a “Dockydock,” which is a glorified tarp that is mounted to the slip, and you pull your boat over it. He agreed to change the language so it won’t be misinterpreted.
Commissioner Faires questioned how the amendment to Section 10 would impact situations of partial boat ownership. Mr. Baker answered that these restrictions are not aimed at multi-owner/partnerships and would not impact their ability to use the boat. The proposed amendment is geared towards excluding single tenants from using the sharing apps and renting the vessel to non-owners. A multi-owner businesses would fall under a business lease agreement, and that would allow for this type of activity. Commissioner Faires suggested that additional language could be added to clarify that the regulation would not apply to multi-owner rental businesses.
Commissioner Preston asked if the proposed amendment to Section 10 would still allow multiple individuals to own the same boat (fractional ownership). Again, Mr. Baker agreed that the language could be more specific to provide additional clarity.
Commissioner Preston referred to the proposed amendment to Section 4.3 and recalled a previous discussion that rather than requiring the Port to be listed as an additional insured, the Port must be listed as an interested party. Ms. Drennan responded that the decision was that existing tenants would be grandfathered in, but new tenants would be required to list the Port as an additional insured.
Mr. Baker agreed to update the proposed amendments as discussed and present them for approval at the April 26th Commission meeting.
PROJECT REPORT: ADMINISTRATION/MAINTENANCE BUILDING
Mr. McChesney provided a progress report on the Administration/Maintenance Building Project, specifically noting the following:
• Staff is working with the design team to create a final floor plan, and a draft (not final) conceptual design was attached to the Staff Report. The effort has been in abeyance while the submittal packet for the Edmonds Architectural Design Board was prepared. The 2nd floor is a challenge to allocate and configure the space for best efficiency. For example, how big does the Commission meeting room need to be, and can we move the archives somewhere else to create more commercial office space upstairs? The primary issue is the amount of space and location for commercial occupancy relative to the Port’s administrative requirements. Some fine tuning and more discussion are needed before the plan can be finalized, and it will be a topic of discussion at the Commission’s May retreat.
• He mistakenly reported to the Commission at their last meeting that the Architectural Design Board would docket the project for review in May, but that is incorrect. The City’s Planning Division needs a month to review the application materials before presenting the application to the Architectural Design Board for review. Then the Board will need a month to look the application over before the public hearing date. It is now expected that the Architectural Design Board hearing will occur on July 7th. It is not anticipated that this change will impact the project’s overall schedule.
• The preliminary architectural cost estimate is quite a lot more than anticipated. The initial working estimate was $2.5 to $3 million. In the meantime, construction costs for labor and materials have exploded beyond reason, and the building construction cost is now estimated to be $3.7 million, plus soft costs (fees, contingencies and taxes) for a total cost of between $5.2 and $6 million. He recommended the project continue to move forward for the time being. The Commission can have a discussion at their retreat and then decide the best way to go forward.
• As they work through the final design and permitting, staff is doing some financial analysis to determine economic feasibility. They are exploring some different ideas for value engineering to lower the cost, and the amount of leasable commercial space becomes an important consideration for some level of predictable cost recovery. The findings will be presented to the Commission at their retreat in May.
Commissioner Faires said he would like staff to provide a Profit and Loss Statement at the May retreat that shows the annual impact of the project costs, as well as the recovery costs from potential leased property. Mr. McChesney summarized that Commissioner Faires would like more information about the actual carrying cost of the project after the commercial rent is deducted. Commissioner Faires said he wants to be able to look at both the Administrative/Maintenance Building Project and the North Portwalk and Seawall Projects, since they are coupled to some extent by the property that will be vacated by the present Administration Building.
Commissioner Orvis recalled that when Washington Public Port Association (WPPA) purchased its new building, it became both the landlord and a tenant, paying the same rent as everyone else. Using this approach, there was no doubt about the amount of income generated by the building. He suggested they use a similar approach to consider the cost, benefits, and tradeoffs associated with the new Administration/Maintenance Building. Commissioners Faires and Johnston concurred.
Commissioner Faires observed that there is a certain amount of pent-up demand across the market for all of the elements of construction. One subject for future debate at the retreat is the idea of postponing construction for a few years. Mr. McChesney concurred. Once the permits are received and the design is finished, the Commission will need to make a decision one way or another. He noted that the permits would remain in effect for at least two years.
Commissioner Preston asked if the current Administration Building would remain and be rented or if the plan is to demolish it. Mr. McChesney answered that there is no reason to put more money into the existing building, as it is obsolete and would be very difficult to make code compliant. The building is also in the way for the North Portwalk and Seawall Project.
Commissioner Faires agreed that the building should be demolished, and the Commission will need to have a discussion about what to do with this waterfront property, recognizing that some of the property may be used by the North Portwalk Project. Mr. McChesney cautioned that it is unrealistic to think that when the building is demolished and the lot is vacant, the Port will be able to obtain a permit to construct another commercial building on the property. It would be very difficult and challenging to do based on the current Shoreline Master Program.
PROJECT REPORT: NORTH PORTWALK AND SEAWALL RECONSTRUCTION
Ms. Williams provided a progress report on the North Portwalk and Seawall Reconstruction Project, specifically noting the following:
• There was further discussion on the design element of raising the Portwalk six inches and extending it to the curb. There are pros and cons to the idea that all affect the look of the Portwalk, location of the utilities, the transition of the existing ramp near the Administration Building, and the angle of the gangways. There could also be permitting benefits to raising the Portwalk if they can illustrate how it would provide more light. This decision is a big one and will be a topic of discussion at the Commission retreat. Makers will present at least two design options, one that incorporates the six-inch rise and one that does not, and the Commissioners will be asked to weigh in.
• CG Engineering reported that they have been in communication with both Fish and Wildlife and the City of Edmonds to discuss the bulkhead at the fishing pier that the Port would like to replace as part of the project as it is on Port property and affects the Seawall. Both entities have agreed to the Port doing the work and have asked for a design and scheduling review.
• The plumbing and electrical contractors have asked that their first submittal be at 60% rather than 30%, as they require certain architecture information that will come from the 30% design submittals to do their work. The Port has agreed to this change.
• The Port has asked CG Engineering to look into whether a pre-application meeting for the Joint Aquatic Resource Permit Application (JARPA) will be required.
• CG Engineering reported that Landau Associates confirmed that the City of Edmonds did not accept the Port’s Critical Areas Exemption and a Substantial Development Permit will be needed. This can run at the same time as the State Environmental Policy Act (SEPA) review process and will take approximately 10 weeks to complete.
• The project is currently running on schedule, and the consultants look forward to presenting their information to the Commission at the May retreat.
Commissioner Faires pointed out that both options provided by Makers will still require some kind of ramp to meet up with the existing cement boardwalk south of the Administration Building. He said he is interested in what the consultant will provide to address this transition. Ms. Williams said that, if the Portwalk is raised six inches, the ramp would likely be lengthened so it is unnoticeable. However, that option would have a greater impact on the gangways. On the other hand, the other option would require ramps that are Americans with Disabilities Act (ADA) compliant to transition from the boardwalk to the parking lot. There are pros and cons with either design idea, but Makers believe that, from an aesthetic standpoint, it would look nice to raise the Portwalk. However, as they discussed the potential impacts and associated costs, they questioned whether it would be worth the additional cost. Commissioner Faires said it will be interesting to see what the transition between the raised Portwalk and the present parking lot would look like. McChesney advised that there are cost implications associated with the two options that must also be considered.
Commissioner Johnston asked if the change associated with the delayed plumbing and electrical designs and City’s denial of the Critical Areas Exemption would have cost implications on the project. Mr. McChesney said he doesn’t believe these two changes will impact the project costs. The request for an exemption was an attempt by the design team to figure out a shortcut, as the regulation states that a Critical Areas Assessment would not be required for reconstruction or maintenance. The City’s Planning Division’s interpretation of the regulations is that the Critical Areas Assessment is required.
EDMONDS BUSINESS BOOSTER PORTAL
Ms. Williams explained that the Edmonds Business Booster Portal is a page on the Edmonds Chamber’s website that shares tools and resources for people looking to either start or grow their business in Edmonds. It was formed as a collaboration with the Chamber and the Edmonds Economic Development Commission (EDC). They partnered with a variety of players throughout the community who already contribute to this form of economic development, including Edmonds Community College, Small Business Development Center, Sno-Isle Libraries, and Port of Edmonds. She reported that she and Mr. McChesney took part in an informational interview with Kevin Harris from the EDC about a month ago to share the different ways the Port does and can create an environment that encourages business growth. They talked about the diversity of the businesses that operate at the Port already, both on land and in the water, and how the Port’s setup allows for growth. They will join a panel of community players in a brainstorming workshop next week to further discuss development of the portal, which is in its early stages. She said she would provide updates to the Commission as the project moves forward.
MARINA CLEANUP DIVE
Ms. Williams reminded the Commissioners that the Marina Cleanup Dive will be the morning of April 18th. The event will be posted on social media, along with a reminder that pandemic protocols are in place. Pictures and information about the event will be published in the Port’s next newsletter.
EXECUTIVE DIRECTOR’S REPORT
Mr. McChesney suggested that the Port Retreat should be scheduled for Wednesday, May 12th. He has a tentative booking at the Edmonds Yacht Club, but they don’t have Zoom capability or other logistical things that are needed for the retreat. He suggested a hybrid solution where the Commission and staff can gather in the Commission room, and people who are not comfortable attending in person can participate via Zoom. He expressed his belief that it is time to start to transition back to in-person Commission meetings, but it is up to the individual Commissioners and staff to determine how comfortable they feel doing so. He further suggested that the May 10th regular meeting could be rescheduled as a special meeting combined with the retreat on May 12th.
Commissioner Harris noted that several consultants will be invited to participate, and she is concerned about having enough space to observe pandemic protocol. She asked if it would be possible to book an alternative location that allows more room. Mr. McChesney noted that some of the consultants could present via Zoom, and the other consultants could be scheduled for different time slots. He said staff will continue to work out the logistics for the meeting, including an alternative venue, if possible.
The Commissioners indicated support for a retreat on May 12th starting at 9:00 a.m.
COMMISSIONER’S COMMENTS AND COMMITTEE REPORTS
Commissioner Orvis reported that he met with Gary Clark, the new Chief Executive Officer (CEO) of the Economic Alliance of Snohomish County (EASC). They discussed the Port, Harbor Square, and Edmonds in general, and he invited him to visit the Marina. He made a pitch that the EASC needs to start looking at small businesses, and he talked to him about the International District and the need to put more effort into recruiting Asian businesses. He also reminded him that when the EASC was formed, the Edmonds Chamber wasn’t interested in participating, so most of the input came from the South County Chamber that is primarily out of Lynnwood.
Commissioner Orvis asked if the Port has started working on redistricting efforts, and Ms. Drennan responded that they haven’t received the information yet. Commissioner Faires said he suspects that some minor adjustments may be needed, but no significant changes. Commissioner Orvis concurred.
Commissioner Orvis provided a legislative report, specifically noting the following:
• The legislature will have to start voting on legislation soon, and a lot of bills will have to be cut.
• The link between clean fuel, cap and trade, environmental justice, and a transportation package is set up so they are an all or nothing proposition.
• There will be full funding for remedial action grants under the Model Toxic Control Act (MTCA). Last year, the Department of Ecology (DOE) could only give money for a year at a time, and ports looking at long-term projects had no idea whether they would get funding in subsequent years. The House is requiring the DOE to work with the Port of Everett, in particular, to get an agreement in place that ensures that funding comes along.
• A senate bill includes $5 billion for transportation, but it is unclear at this time where it will go or what it will be linked to.
• There are two broadband bills that differ significantly because the Senate limits the retail authority for ports to rural areas, and the House Bill allows ports to work in more urban areas.
• There is a bill prohibiting ports from purchasing container handling equipment that is near or zero emissions and allows for automated operations. In other words, they are more worried about displacing longshoremen than reducing emissions.
• There is still a bill that would create a Membership Organization (State Bank) that allows ports to invest money that can be loaned to other public entities.
• The clean fuel standard, cap and trade, and fuel tax issues have engendered a number of amendments, some of which require the DOE not to do anything until they have procedures in place to allow the import of the fuel additives that are required for low carbon fuel standards.
• Another amendment requires the DOE to produce its environmental reports based upon total emissions, including the emissions that are saved in other countries. Tied into this is a bill that removes the DOE’s authority to set the pace of program implementation instead of establishing a specific implementation schedule by law. The DOE must now come up with a schedule and criteria that cannot be changed.
Commissioner Faires advised that he would attend the Edmonds Economic Development Commission meeting on April 21st and will provide a report at the next Commission meeting.
Commissioner Johnston reported that he attended two EASC Coffee Chats over the past two weeks. One was on export resources, where the Scuttlebutt Brewery owner, who has been exporting to China and other international locations for some time, advised that there is a great market for American home brews. The other Coffee Chat featured University of Washington President Ana Mari Cauce, who outlined the university’s ongoing initiatives and direction and has high hopes for making the university even greater.
Commissioner Johnston announced that he registered for the virtual WPPA Spring Meeting on May 19th through 21st.
Commissioner Preston said he also participated in the EASC Coffee Chats. He said he is excited for the cleanup dive, as Annie Crawley does a wonderful job with the events. She also does a wonderful job with social media throughout the year, advising the public of what the youth are doing at the dive park.
Regarding the idea of having hybrid meetings that people can attend in person or via Zoom, Commissioner Preston suggested that individuals be allowed to make their own decision based on their comfort level.
Commissioner Preston referred to emails he received last week regarding a proposal to double the watercraft excise tax. He asked about the status of this legislation. Commissioner Orvis said it is one idea that came up as part of the transportation discussion. The legislature is looking for a lot of money for transportation projects, and gas tax revenue is down because people are driving less.
In addition to the legislature wanting to get into the banking business, Commissioner Preston advised that they are also interested in getting into the 401K business. They are already in the business of long-term care, so every W-2 wage will be charged a new tax of .58 percent, which equates to $580 per year on a $100,000 income. It would be one thing if people could use this tax to purchase a policy, but those who move out of state after retirement would not qualify for the funds.
Commissioner Harris advised that Gayla Shoemake has requested an opportunity to meet with her about solar opportunities at the Port of Edmonds. She is also interested in learning more about the Port’s efforts to obtain LEED Certification for the new Administration/Maintenance Building. Commissioner Faires reminded the Commission that they still need to provide direction to the design team relative to LEED Certification, and Mr. McChesney advised this would be addressed at the retreat.
EXECUTIVE SESSION
Commissioner Harris announced that the Commission would recess into an Executive Session pursuant to RCW 42.30.110(1)(i) to discuss with legal counsel representing agency matters relating to agency enforcement actions, or to discuss the legal counsel representing the agency litigation or potential litigation to which the agency, the governing body, or member acting in an official capacity is, or is likely to become, a party. She advised that the Executive Session would last approximately 10 minutes, and the Commission would resume the public portion of the meeting after the Executive Session. She further advised that no action would be taken after the Executive Session.
The Executive Session was adjourned at 9:25 p.m., and the business portion of the special meeting was reconvened immediately.
ADJOURNMENT
The Commission meeting was adjourned at 9:25 p.m.
Respectfully submitted,
Steve Johnston
Port Commission Secretary