02 Jun Commission Meeting Minutes 4-24-23
PORT COMMISSION OF THE PORT OF EDMONDS MINUTES OF REGULAR MEETING
(Zoom and Hybrid Meeting) April 24, 2023
COMMISSIONERS PRESENT
Steve Johnston, President
Jim Orvis, Vice President
Jay Grant, Secretary
Angela Harris
David Preston
COMMISSIONERS ABSENT
STAFF PRESENT
Bob McChesney, Executive Director
Brandon Baker, Director of Marina Operations
Tina Drennan, Manager of Finance and Accounting
Brittany Williams, Manager of Properties and Economic Development
OTHERS PRESENT
Jordan Stephens, Port Attorney
Neil Tibbott, Edmonds City Council
CALL TO ORDER
President Johnston called the meeting to order at 7:00 p.m.
FLAG SALUTE
All those in attendance participated in the Pledge of Allegiance to the American Flag.
CONSENT AGENDA
COMMISSIONER PRESTON MOVED THAT THE CONSENT AGENDA BE APPROVED TO INCLUDE THE FOLLOWING ITEMS:
A. APPROVAL OF AGENDA
B. APPROVAL OF APRIL 10, 2023 MEETING MINUTES, AS AMENDED
C. APPROVAL OF PAYMENTS IN THE AMOUNT OF $3,786,085.24
COMMISSIONER HARRIS SECONDED THE MOTION, WHICH CARRIED UNANIMOUSLY.
PUBLIC COMMENTS
There were no public comments.
APPROVAL OF CONTRACT NO. 2023-448 FOR REBRANDING SERVICES
Ms. Williams reviewed that, with support from the Communications Committee, she and Mr. Baker proposed a Port rebranding project at the November 28, 2022 Commission Meeting. The purpose of the rebranding will be to update the Port’s logo, slogan and color scheme and refine the overall brand identity. The rebranding work will guide major upcoming projects and investments, including a new website and signage for the new Port Administration Building. Ms. Williams further reviewed that following a presentation on the proposed scope and timeline, the Commission authorized staff to move forward with the rebranding proposal. Staff formulated a Request for Proposals (RFP) for a Rebranding Services Contract 2023-448 and solicited proposals. The RFP was advertised in THE EVERETT HERALD, posted on the Builder’s Exchange and sent to 56 marketing firms. The distribution list was comprised of companies found on the Municipal Research and Service Center (MRSC) Roster, a directory on the Washington State Office of Minority & Women’s Business Enterprise’s website, and several local firms discovered through research.
Ms. Williams referred to the RFP timeline, as well as a list of the scope of work and deliverables, which were both included in the Staff Report. She explained that, due to the nature of the contract, it was determined that a grading rubric was used to score and select the proposals. This allowed staff to make recommendations on a value proposition rather than strictly on cost. The criterion used were (A) the portfolio and past work examples, (B) proposal quality, (C) interview, (D) cost effectiveness, and (E) availability and proposed timeline.
Ms. Williams reported that 11 proposals were received, ranging in cost from $7,845 to $189,077. The proposals were scored on Items A, B, D and E from the grading rubric, and interviews were then conducted with the three highest scoring firms. Interview scores were added to the grading rubric to determine the top candidate. People-People was the highest-scoring candidate and staff’s recommendation for leading the Port’s rebranding effort. They have the experience, expertise and personnel to spearhead all aspects of a rebrand, from brand strategizing to website development.
Ms. Williams advised that taking on this project now will help the Port improve its messaging in all areas of business. It is important to determine the type of marketing relationship they want to have between the Port, Marina and Harbor Square. They also want to continue to develop ways to educate residents about who the Port is and how it differs from the City. In addition, they want to improve the website experience and create a more cohesive look at the Port’s physical properties. The contract would not only provide a refreshed logo and new taglines and slogans, but also the full brand kit to help the Port internally. The timing of the project is crucial, as they want to get ahead of some major investments that are already planned and get branding in place for the much-needed new website and signage at the Administration/Maintenance Building and Portwalk.
Ms. Williams referred to the full list of deliverables for the contract, which was attached to the Staff Report. She advised that all three firms that were interviewed were capable and impressive, but there was a clear winner to staff.
Mr. Baker advised that People-People is a Seattle-based company that has been in business since 1998, and all of the consultants working on the project will be senior level. They have been doing this work for a long time, are well versed, and are in a good position to yield the Port the best results. Their areas of expertise are brand development, web design and development, print design, name and messaging strategy, and research and insights. These are all of the things the Port is looking to accomplish with the contract. He shared a number of examples of their work, noting things that particularly stood out as applicable to the Port’s project.
Mr. Baker briefly reviewed the timeline:
• Phase 1 – Research and Focus Groups (May through July). The intent is to work with the Commission, staff, constituent and tenant groups so People-People can effectively identify a vision for the Port. The vision will drive their work going forward.
• Phase 2 – Identity and Template (July through September). During this phase, they will consider potential logos, fonts, etc. The consultant will be designing collateral templates for stationary, business cards, brochures, etc.
• Phase 3 – Website Design and Development (October through November). Once the website has been designed and developed, People-People will train Port staff on how it functions. They anticipate an easy transition since the website will be built on the same platform the Port is currently using.
Mr. Baker advised that the three phases will end the scope of work for the currently-proposed contract. However, as discussed in earlier meetings, the work will carry on over quite a few years to include signage, vehicles, uniforms, and anything else with a Port logo. The transition will be slow, with things being replaced as they reach the end of their life.
Ms. Williams clarified that the proposal represents the consultant’s standard contract and is not the contract staff will ultimately bring forward. At this time, staff is asking for approval to start working on a contract with People-People. The Port uses its own contracts, so some elements will need to be discussed further and adjusted. She noted that the proposal included some optional pieces, which won’t all be included in the final contract.
Mr. Baker advised that the Communications Committee will be the sounding board as they work through the project, and staff will provide updates to the Commission at several milestones. People-People will also provide a few presentations at Commission meetings. At this time, it is too early to identify when the milestone presentations will be. Ms. Williams added that the focus groups will be an important part of the project. The goal is to have focus groups that consist of Commissioners and internal staff. It will also be important to solicit tenant and constituent feedback on certain aspects of the project, especially the website.
Commissioner Preston asked if staff expects the logo to be finished by September (Phase 2). Ms. Williams said People-People wants to develop the slogan/motto/tagline first since that will drive the messaging going forward. The art would be included as part of Phase 2. She noted that Commissioner Harris has advised that the Communications Committee will be presenting its work on the Mission Statement soon, and this will be a key piece to provide to the consultant.
Commissioner Orvis said he has been amazed at the number of websites for both large and small organizations that are still not intuitive and are difficult to use. He stressed the importance of creating a website that is easy for people to find what they are looking for. In particular, answers to frequently-asked questions should be easily accessible. Ms. Williams agreed and commented that it will be a bit tricky because people visit the Port’s website for completely different reasons. For example, residents might visit the site to find out about a particular event, and customers might be searching for specifics on launching boats. The goal is to provide a good user experience for everyone who visits the site. Mr. Baker added that the website is becoming more of a tool for marina customers to complete basic tasks, and the consultant will help make it easy for high-use people to do business with the Port via the website. Commissioner Orvis commented that Port Commission Minutes and Agendas, Operating Budgets and other important information should be easy for people to find, as well. Mr. Baker agreed and noted that the Port has legal requirements to provide this information to the public, and staff has been and will continue to brainstorm ways to make it easier to find.
Commissioner Johnston stated that, given the high score staff gave to People-People, he suspects that staff had discussions with them during the interview and are very comfortable with their proposed approach and understanding of the Port’s needs. Ms. Williams and Mr. Baker answered affirmatively. Ms. Williams explained that some of the proposals were beautiful and impressive, but they didn’t seem to be a great fit for the Port. Staff felt that People-People proposed the perfect mix of interesting, attractive designs and also understood that public agencies need to be somewhat cautious when it comes to branding.
Ms. Williams said she anticipates the final contract will be about $90,000. She explained that, as staff fine tunes the contract, some things will be eliminated to make the project more cost effective. For example, the number of unique pages on the website will be reduced.
Commissioner Preston asked if staff has reviewed websites from other ports and cities to identify things they like and don’t like. Ms. Williams answered that staff did a lot of this type of research about a year ago as part of an initial step towards refreshing the Port’s website. Staff will provide this research to the consultant.
COMMISSIONER ORVIS MOVED THE COMMISSION AUTHORIZE THE EXECUTIVE DIRECTOR TO ENTER INTO A CONTRACT FOR REBRANDING AND WEBSITE DEVELOPMENT SERVICES WITH PEOPLE-PEOPLE IN AN AMOUNT THAT WILL NOT EXCEED $95,000. COMMISSIONER PRESTON SECONDED THE MOTION, WHICH CARRIED UNANIMOUSLY.
2022 YEAR END FINANCIAL STATEMENTS
Ms. Drennan recalled that the preliminary 2022 year-end financial statements were previously presented to the Commission on February 13th. As required by the State of Washington, the final annual report is being presented in the Budgeting, Accounting and Reporting (BARS) format and will be submitted to the State Auditors Office and available on the Port’s website later in the week. Finance Committee members were provided the 2022 Annual Report for review on April 7th, and all have acknowledged that they reviewed it.
Ms. Drennan reviewed that she presented the 2022 Balance Sheet and Income Statement at the February 13th meeting. The attached Statement of Net Position shows the same information as the Balance Sheet but may be presented a little differently. The Statement of Revenues, Expenses and Changes in Fund Net Position shows the same data as the Income Statement, but it is less detailed than the previous presentation. There were no major changes to the financial statement numbers since the February 13th meeting. The minor changes were 2022 invoices that came in after the February 13th meeting in the amount of $2,423, and net income was reduced by that amount.
Ms. Drennan announced that the Statement of Cash Flows (Page 13) is a report that wasn’t presented at the February 13th meeting and shows the sources and uses of cash in 2022. Operating activities provided net cash of $4.1 million. It is important that organizations regularly produce positive cash flow from operations, as this is the daily activity of the organization. She highlighted the following:
• Noncapital financing activities provided net cash of $633,000, and these activities include proceeds from property tax income and operating grants.
• Capital and related financing activities used net cash of $3.2 million. Cash flows include purchases and construction of capital assets, capital grants and interest paid on leased assets, which are the leased copy machines that are now subject to Government Accounting Standards Board (GASB) Statement No. 87.
• Investing Activities provided net cash of $650,000. Cash flows from investing activities include the maturity and purchases of long-term investments and interest from the Port’s investments.
• Total cash increased by $2.2 million in 2022. As per the Cash Flow Model, excess funds over and above the other reserves have been moved into the Capital Replacement Reserve to pay for future capital projects.
The Commissioners congratulated Ms. Drennan for a very well-done report.
1ST QUARTER 2023 FINANCIAL STATEMENTS
Ms. Drennan presented the 1st Quarter 2023 Financial Statements, noting that revenues generally trended up from $2.2 million to $2.8 million in 2022 and expenses ranged from $1.5 million to $1.8 million. As adjusted by the Consumer Price Index (CPI) with 2018 as the base period, revenues ranged between $2.1 and $2.3 million and expenses ranged between $1.5 and $1.7 million. Net income generally trended up, ranging from $500,000 to $1 million. Adjusted by CPI, net income ranged from $505,000 to $836,000. Actual to budget, revenues were $209,000 greater than budget and expenses were $273,000 less than budget. This will not likely continue as the Port enters its busy season. Gross profit for the 3-month period was $2,283,000, which is $43,000 greater than budget. Net income for the same period was $1,002,000. She highlighted the following items:
Marina Operations Revenue Actual to Budget
• Net Guest Moorage revenue was $16,812, $10,188 (38%) less than budget. This is likely a timing situation.
• Permanent Moorage revenue was $1,155,851, $12,600 (1%) greater than budget.
• Dry Storage revenue was $187,073, $15,000 or 7% less than budget. This is likely a timing issue, as well.
• Financial occupancy for Permanent Moorage was 99%, and 98% was budgeted. Financial occupancy for Dry Storage was 84%, and 92% was budgeted. This variance is anticipated due to the time of year.
Rental Properties Revenue Actual to Budget
• Total Rental Property revenue to date was $745,201, $40,451 or 6% greater than budget.
Operating Expenses Actual to Budget
• Operating expenses before depreciation for the 3-month period were $1.3 million, $246,000 or 16% less than budget.
• Employee Benefits were $195,245, about $10,000 or 5% less than budget. This is primarily a timing situation.
• Payroll Taxes were $67,311, a variance of $15,000 or 18%, again because of a timing issue.
• Repair and Maintenance expenses were $56,835, a variance of $88,415 or 61%. This is primarily a function of utility.
• Salaries and wages were $591,377, a variance of $91,373 or 13%.
• Utilities were $141,763, a negative variance of $18,013 or 15%, which is a function of cold weather.
Other Income and Expenses
• Interest income was $224,065, which is a positive variance of $159,315 or 246%.
• Overhead was negative in the 1st Quarter of 2023 as a result of some transactions associated with bonds that were purchased at a discount in December of 2022 and January of 2023. Generally Accepted Accounting Principles state that you amortize the bond premium or discount over the life of the bond if the bond is noncallable. However, if it is callable, you amortize it over the noncallable portion. Both bonds were callable shortly after the Port purchased them, so the discounts of $117,370 and $32,222 were amortized in the first quarter of 2023. Because the transaction increased interest income, the Overhead Cost Center generated more revenues than expenses in the 1st quarter. There will be a negative allocation in the Marina and Rental Properties Overhead line items. This is simply a book transaction and no money was exchanged.
Net Income
• Net income after depreciation for the 3 months ending March 31st was $1,002,000, or $482,000 greater than budget.
Marina Actual to Budget
• Revenues and expenses trended upward to a high of $1.6 million in 2023 and expenses ranged between $1 million and $1.1 million.
• Net income trended upwards to $603,000 in 2023.
• Operating revenues were $2,500 greater than budget and expenses were $280,000 less than budget.
• Operating revenues were $1,628,000 or $2,250 greater than budget.
• Operating expenses before depreciation and overhead were $759,000, or $88,750 (10%) less than budget.
• Net income was $603,000 or $283,000 (88%) greater than budget.
Rental Property Actual to Budget
• Rental property revenues ranged from $650,000 to $750,000 and expenses ranged from $350,000 to $425,000. The Port subsidized the Harbor Square Property with property tax revenue in 2007 through 2019, and this subsidy was removed so that the numbers better represent what is actually happening. Net income ranged from $265,000 to $399,000.
• Actual to budget revenues were $40,000 greater than budget and expenses were $159,000 less than budget.
• Operating revenues were $745,000 or $40,250 (6%) greater than budget, and operating expenses before depreciation and overhead were $201,000 or $55,250 (22%) less than budget.
• Net income was $399,000 or $198,785 (99%) greater than budget.
Investing Summary
• As of March 31st, the Port had 18 long-term investments.
• Cash and investments increased by $1.9 million in 2022, and this was added to the Capital Replacement Reserve in the 1st Quarter of 2023. The Capital Replacement Reserve is currently at $18,763,000.
• The Environmental Remediation Reserve is currently $1,081,000 and the Public Amenities Reserve is currently $552,000.
• As bonds are being called or maturing in 2023, the Port will continue to invest them using the laddering method, increasing the ladder rungs from $500,000 to $1 million.
Commissioner Orvis observed that the Port has a good start (Capital Replacement Reserve) on its share of a grant to replace the North Seawall. However, Ms. Drennan reminded them that about $5 million of the reserve would be used to fund the new Administration/Maintenance Building.
1ST QUARTER 2023 PORT OPERATIONS REPORT
Mr. Baker presented the 1st Quarter 2023 Port Operations Report, highlighting the following:
• Water Moorage. They reached a 5-year low in terminations and turn-over ratio. There were 13 terminations in the quarter and a turnover ratio of 1.96, which is the same as in 2022. At the end of the quarter, there were 352 members on the waitlist, which is just below the 355 at the end of 1st quarter 2022. Demand is holding strong.
• Guest Moorage. There were decreases across the board, with 321 total nights in 2023 compared to 420 in 2022. That’s a decrease of 24%. The number of boats was also down 29%. This trend holds true for the Fuel Dock and Public Launch, as well. There were only nine days of open fishing in the 1st quarter of 2023.
• Document Compliance. At the end of 1st Quarter, insurance compliance was at 86% and registration compliance was at 80%.
• Dry Storage. Dry Storage had an 81% occupancy rate at the end of 1st Quarter of 2021, with 53 total trailers stored. Launch activity decreased by 35% due to less fishing. Total boat moves for the quarter were 835, which is an 18% decrease compared to 2022.
• Boatyard and Travelift. Sling time with pressure wash increased, but all other categories were down. There were 25 total treatments through the pressure wash system. A tenant special ran from early February through early March, and 22 people claimed the offer of 25% off haul-out fees.
• Fuel Dock. The number of gallons of gasoline pumped decreased by 33%. The price per gallon for unleaded fuel was $4.96 at the end of the quarter, which is $.24 less than 2022 prices, and diesel decreased by $1.14. Pricing surveys continue to show that the Port’s fuel price for unleaded was $.15 lower than average and diesel was $.06 above average. Commissioner Orvis asked about the long-term forecast. Mr. Baker responded that, as fishing opportunities dwindle, he expects fisherman to exit boating or move to a different type of ownership that lowers their overhead and allows them to get on the water when they want to. Boats designed for fishing don’t convert well to cruising. However, there is still some optimism that fishing opportunities will improve.
• Public Launch. Round-trip launches decreased by 41% or 73 fewer round-trip launches compared to 2022. One-way launches increased by 22% or 28 more trips.
• Staff Training. All applicable staff completed HAZWOPPER refresher training, and all staff completed first-aid, AED, and CPR training. In addition, the Operations Staff and select Facilities Staff attended training for the Public Launcher, and four staff members earned their train-the-trainer certification.
• Project Hours. The operations team devoted hours to a number of projects.
• Water Samples. Water samples in 1st quarter were good, but this will likely change in 2nd quarter. New oyster shells were installed, and samples were collected in both March and April. They exceeded one benchmark, per sampling month.
• Security – Police Activity. On-View Activity counts anytime that security notices suspicious activity. As the weather gets warmer and the park is used more heavily, policing can become more of a task. The team has done a good job of fostering a relationship with the Edmonds Police Department, and their response times have been very quick. Commissioner Orvis asked if Security Staff have experienced problems with people sleeping in vehicles and tents on Port property, and Mr. Baker answered that they deal with two or three situations a week. Staff does a good job of identifying the situations before the campers are settled in and become a problem.
1ST QUARTER 2023 HARBOR SQUARE REPORT
Ms. Williams presented the 1st Quarter 2022 Harbor Square Report, highlighting the following:
• Gross projected revenue was up 10.6% or roughly $55,000 over the same period in 2022. This was due to a consistent occupancy rate and a high CPI rate, which is the basis for the majority of annual adjustments.
• The occupancy rate at the end of the 1st Quarter was 91.92%, up 1.55% from the occupancy rate of 90.37% in 1st Quarter 2022.
• No leases ended in Quarter 1, and there were no new leases. There were five lease extensions and an assignment of a tenant in Building 2.
• Major projects included paver repairs at the Harbor Square monument sign. The damage was likely caused by the company that installed the fiber-optic cable. Other projects were Building 2 restroom fan replacement and major sofit repair at Building 2 as a result of water damage. Commissioner Johnston asked if the pavers were broken, and Mr. McChesney answered that none were broken. However, they were sinking due to the wheel loads of the large trucks and needed to be reset.
• There were no incidents to report.
Commissioner Grant asked if any additional work has been done to address windows that were leaking and causing damage. Mr. McChesney answered that the Port had to pause its plan to replace the atrium windows. The design and engineering work has been done, but staff is currently bogged down with bringing the new Administration/Maintenance Building on line. Once a Certificate of Occupancy has been issued for the new building, there should be sufficient staff resources to move forward with the atrium window replacement project. He recalled that they discussed a sequencing strategy, starting with Building 4. His best guess is that the work would proceed in the 1st quarter of 2024. Commissioner Johnston asked if there is a cost estimate for the window project, and Mr. McChesney answered that they haven’t perfected the plan to that level yet.
DARK FIBER DISCUSSION
Mr. McChesney briefly introduced the topic, noting that Commissioner Grant submitted a proposal to be considered. He recalled that the dark fiber issue goes back about 12 years, with various approaches being considered over that time period. From the Port’s point of view, they have struggled and continue to struggle to make a business case for it.
Commissioner Grant reviewed that, in 2005, the Department of Homeland Security (DHS) started pushing for all critical infrastructure to have fiberoptic, primarily because it is fast, resilient and efficient. At that time, the City of Edmonds was given 24 strands, enough to serve the entire Edmonds community. The City’s current government connections are the Edmonds Center for Performing Arts, Public Safety Building, City Hall and the Sewer Treatment Plant. Two commercial companies, Rick Steves’ Europe Building and the 2nd Avenue Building, are connected and use the service for a fee. The most efficient way to extend fiberoptics between Harbor Square and the new building is to use radar technology, which is highly-efficient and very secure. Many ports around the world use the Radwin System, and they offer programs as low as $2,000. The purpose of this discussion is to review history and get feedback from the Commission and staff. Down the road, anyone that can will likely change over to optic fiber for its resiliency, efficiency and speed.
Mr. McChesney pointed out that there is already dark fiber terminating at Harbor Square Building 2. Commissioner Grant recalled that the City pitched fiberoptic to Maverick, but they felt it was too costly at the time. Three or four years ago, the Second Avenue Building was charging each tenant $82.50 per month to use the fiber. Commissioner Orvis asked if Building 2 is currently managing the fiber, and Commissioner Grant answered no; it was installed but never lit up. If the Port were to activate the fiber and charge tenants for its use, Commissioner Orvis asked what advantage it would be to the tenants over what they have now. Commissioner Grant pointed out that the current carriers, Ziply and Comcast, don’t yet have fiber. As they look toward the future, he suggested that having faster and more resilient internet would be attractive to potential tenants.
Mr. McChesney suggested they need to verify as to whether or not Ziply has fiber in the vicinity. Ms. Drennan advised that she would be bringing a proposal to the Commission at their next meeting to approve a fiber contract with Ziply. In addition, Ms. Williams stated that both Comcast and Ziply have now installed fiber to Building 2 at Harbor Square, and two tenants are already on board as customers. Mr. McChesney added that the dark fiber that terminates at Building 2 was installed by the City without an interlocal agreement with the Port. At the time, the Port couldn’t make a business case for it and declined to participate.
Commissioner Orvis said he was under the impression that dark fiber had been run to the ferry terminal, and Mr. McChesney said that is his belief, as well. Commissioner Grant said the City has a contract with the Washington State Department of Transportation (WSDOT), and the Department of Homeland Security required the fiber to be extended to the ferry terminal. He confirmed with WSDOT that they would be willing to enter into an agreement with the Port. WSDOT recently added 12 new fibers into the new Sewer Treatment Plant.
Commissioner Grant agreed that the Port must be able to make a business case in order to support extending the fiber to Port property, and perhaps that is something to consider when doing strategic planning. His question is whether it would cost more to put the necessary equipment on top of the new building at a later time as opposed to now. Mr. McChesney said he believes the cost would be about the same, whether now or later.
Darrol Haug, Edmonds, said he is currently a member of the Edmonds Economic Development Commission, and was a member of the commission that approved the fiberoptic process to begin with. He emphasized that he was not present to speak on behalf of either the previous or current commissions. However, he was Chair of the Citizens Technological Advisory Committee, which was the original group that worked with the Department of Homeland Security and others to install the fiber. He stated that, in reality, the City wants to move forward with a more aggressive marketing campaign to attract high-tech companies to Edmonds. They are part of the creative district and creative isn’t just art; it also includes high-tech, internet type industries. Members of the City Council have expressed their intent to find a strategy to partner with the Port, if possible, or do its own thing to use fiberoptic to attract businesses to Edmonds. In fact, he and former Commissioner Bruce Faires made some of the original sales calls to people throughout the City to generate the initial interest. He remains committed to trying to advance the use of fiber to attract new high-tech businesses to Edmonds.
Commissioner Grant pointed out that because WSDOT is managing the fiber at the ferry terminal, it will likely be fixed quickly if it goes down. Again, he is interested in looking towards the future by starting the discussion. If they can build a business plan for it, fiberoptics would attract the types of businesses the Port wants at Harbor Square. These businesses may generate sales tax, which would help the City, as well.
Commissioner Orvis said he can understand the advantages of fiberoptics to attract high-tech businesses to Edmonds, but the City has already installed dark fiber up to Building 2 at Harbor Square. They just need an interlocal agreement with the City to activate it. Because of permitting problems, he doesn’t foresee significant changes at Harbor Square. About the only reason he can see for extending dark fiber to the west side of the tracks is if the Department of Homeland Security was going to put an emergency management headquarters in the Port’s new building or something else that would take volumes of communication equipment that couldn’t handle interruption and parallel systems are needed.
Mr. Haug said one wildcard is how the City moves forward with the implementation of 5g and its associated towers. They have some leverage to encourage providers to extend the service to include others, depending on how the agreements are laid out. While there isn’t a clearcut answer, there is willingness on the part of the City to try and partner wherever possible with the Port to advance high technology in the City of Edmonds.
Mr. McChesney said that, from the Port’s point of view, they supported the initiative by Mr. Haug and former Commissioner Faires to promote economic development, but they just couldn’t make a sufficient business case to move forward with fiberoptic installation. Conceptually, Commissioner Grant’s proposed approach seems good. The conundrum is figuring out what the demand side looks like. He suggested remanding the discussion to the Strategic Planning Retreat. At that time, staff could provide better information to help the Commission identify steps for moving forward.
Commissioner Preston asked if it would be appropriate to consider satellite opportunities as part of the discussion. More and more people are going with satellite for internet. Ms. Drennan pointed out that this wouldn’t be a good choice for well-populated areas. From a security standpoint, the Port wouldn’t want to be on a Wi-Fi system. Resolving problems that come up could also be an issue.
Commissioner Grant summarized that, in today’s world, radar technology is extremely secure. Other ports use it. Again, he would like to continue the discussion at the retreat so that all opportunities can be thoroughly considered. The Commission agreed to continue the discussion at the upcoming Strategic Planning Retreat.
Mr. McChesney recognized and thanked Mr. Haug for his work upfront on the fiberoptic situation in Edmonds. He has put in a lot of time and volunteer effort trying to perfect the concept. Although it didn’t go anywhere at the time, all of the particulars are well in play again.
CITY OF EDMONDS REPORT
Edmonds City Councilmember Teitzel advised that the legislature considered 19 bills related to affordable housing this past session, and many were passed by both the House and Senate and are now heading to Governor Inslee for signature. He provided a list of the bills for the Commission’s information. He commented that it will be very interesting to see how House Bill 1110, which allows multiple dwellings on single-family lots, plays out in Edmonds. Over time, they expect to see a lot more density in the single-family zones, which is concerning from an infrastructure standpoint. He suggested that an unintended consequence will be an increase in the value of lots.
Councilmember Teitzel said there was a presentation at the last City Council Meeting on a Memorandum of Understanding (MOU) between the City of Edmonds and WSDOT regarding the Unocal property. The purchase has been pending between Unocal and WSDOT for a number of years, pending the cleanup. They are hoping that the Department of Ecology will sign off on the cleanup by the end of the year, and the sale can then proceed to WSDOT. Once that happens, the City would like to be first in line to purchase the property if it is put up for sale. The Transportation Budget that was just passed by the legislature includes a clause that gives Edmonds first right of purchase through mid-2025.
Commissioner Orvis asked if the City currently has funding to purchase the Unocal property, and Councilmember Teitzel answered not at this time. He noted that the MOU states that the City would be able to purchase the property at fair market value, as required by law. WSDOT’s pending deal with Unocal is for about $8.2 million, which was fair market value back in 2005. The current value is likely greater, depending on zoning and the types of uses allowed. He said the fair market value will be established based on current zoning, which allows commercial and residential uses. The City’s intent is to restore the site and use it for open space. The property cannot be rezoned at this point because it would benefit the City, but they could rezone it once acquired.
Councilmember Teitzel reported that, prior to the presentation, the City Council received a large number of written comments from citizens, both for and against signing the MOU. Commissioner Orvis asked if an MOU is really necessary given that the Transportation Budget includes a clause that gives the City first right of purchase. Councilmember Teitzel agreed that the clause removes some of the urgency for an MOU. The City Council hasn’t yet signed the document, and it will be brought back for further discussion in May.
Councilmember Teitzel further reported that there was also discussion about drafting a letter from both the City Council and Mayor Nelson to Governor Inslee indicating that the City’s intent for the property is open space, preservation and addressing ecological issues. Specifically, the letter would ask the State to consider retaining ownership of the property in perpetuity in partnership with the City of Edmonds, who would restore it. It is hoped the letter can be ready for City Council signature by early May. A copy of the letter was forwarded to Port Commissioners for feedback.
Councilmember Teitzel said he met with Commissioner Grant at the Fishing Pier Parking Lot, which is jointly owned by the Port and City. As previously discussed, there are quite severe problems with tree roots raising the asphalt and concrete, particularly where the two Americans with Disabilities Act (ADA) stalls are located. He is currently working with the City’s Public Works Department to get the damage fixed, and he notified the mayor of the situation, as well.
EXECUTIVE DIRECTOR’S REPORT
Mr. McChesney noted that his last meeting as Executive Director of the Port will be May 8th.
Ms. Drennan announced that the Port received a $250,000 check today from the Snohomish County Office of Recovery and Resilience for a COVID grant award.
COMMISSIONER’S COMMENTS AND COMMITTEE REPORTS
Commissioner Preston reported that he attended the Edmonds Economic Development Commission meeting on April 19th. He appreciates how Commissioner Haug digs into issues and knows a lot about what is going on in Edmonds.
Commissioner Preston announced that he would attend the Economic Alliance of Snohomish County’s (EASCs) annual meeting, forecasting and awards on April 26th. In addition, he plans to attend a general meeting of the Edmonds Yacht Club on April 25th.
Commissioner Harris advised that she would attend the EASC Coffee Chat on April 25th, where housing will be the topic of discussion.
Commissioner Grant reported that he has been following Edmonds City Council and Woodway Town Council Meetings. As mentioned earlier by Councilmember Teitzel, they met to discuss the situation at the Fishing Pier Parking Lot, and he is working on a resolution. He said he and Commissioner Preston also were present during the recent dock cleanup. Ms. Crawley filmed the event, including interviews with Commissioners and students.
Commissioner Orvis announced that the legislative session ended on April 23rd, but bills on concurrent calendars require reconciling the difference between the two versions, and bills that were approved have been passed on to the governor for signature or veto. They include:
• Apprenticeship program.
• Freight mobility.
• Vacancies in Special Purpose Districts. The rules were changed so that after a vacancy occurs, the remaining members of a governing body must nominate at least once candidate at a meeting. They must then post notice of the vacancy and the name of the nominated candidate(s). The public would then be allowed make nominations. The qualified person who is selected, if it is within 120 days, would serve the remainder of the term of the individual that is replaced. If it is more than 120 days, they will have to run for election at the next election date. Port Attorney Stephens said she would have to double check the timelines. The new process is backwards to how the Port of Edmonds and many other special purpose districts typically do it. Usually, an opening is posted and the public is allowed to submit nominations, and then the commission goes through a process of selecting a final candidate. She said she is keeping a close eye on the legislation, and the effective date probably won’t be until the end of July. That means it won’t impact how the Commission fills the upcoming vacancy.
• Budget. No one knows how the final budget will end up.
• Port Electrification. They are still working on this legislation, which will likely stay in committee.
• Snake River Dams Alternative. The Governor asked for $5 million for a study, but ports and others have asked for an additional $5 million to look at the impact on freight mobility if the dams are removed.
Commissioner Orvis reported on his attendance at the EASCs Coffee Chat on regional transportation, highlighting the following:
• Roundabouts are in the works at large intersections.
• The County’s six-year plan concentrates on infrastructure and fixing traffic problems at growth sites (i.e., Marysville and Arlington).
• A traffic study is needed in order to apply for federal grant funding, but you can’t initiate a traffic study until you know what you are going to put in.
• The Governor has a big traffic plan, but there in insufficient staff to implement the program. Marysville, for one, is providing engineers to the state to staff traffic design in their areas.
• Growing cities must plan for residents to safely get around.
• Stormwater facilities, snow removal, culverts, etc. seem to have been overlooked in much of the rulemaking they will now have to live with as a result of recent legislation.
• The design/build model is becoming much more popular for roads and infrastructure.
Commissioner Johnston reported that the Port has a signed employment agreement with Angela Harris, who will serve as the Port’s new Executive Director effective May 22nd. This culminates a highly successful search for Mr. McChesney’s successor, and the outstanding result speaks for itself. He thanked everyone who was involved. With the pending transition of Commissioner Harris to the Executive Director position, the search for her replacement on the Commission has started. With the help of Commissioner Orvis, he has crafted an announcement with an updated map of District 1, which includes most of the north end and the east edge of the Port District. The Commission must appoint a new Commissioner within 60 days of Commissioner Harris vacating her seat on May 21st. The plan is to publish the announcement on May 9th, with a deadline date for responses of May 23rd. Port Attorney Stephens has advised that they don’t have to conduct interviews, but they probably should if there are multiple candidates.
With a new Executive Director and new Commissioner in June, Commissioner Johnston suggested they invite Frank Smelick from the Washington Public Port Association to make a special presentation to the Commission and staff on the responsibilities of authorities. Prior to the presentation, the Commission and staff could have a discussion to better understand what is and isn’t working and to get a feel for whether their current relationships are working well enough.
Commissioner Johnston reported that he also attended the EASCs Coffee Chat on regional transportation. As Commissioner Orvis reported, the primary focus was on north central Snohomish County. He announced his plan to attend the Washington Public Port Association’s Spring Meeting on May 16th through 18th.
Darrol Haug thanked all the past and current Commissioners, staff and Executive Directors for all of their good work since 1949. They have been very helpful for the community.
ADJOURNMENT
The Commission meeting was adjourned at 8:47 p.m.
Respectfully submitted,
Jay Grant
Port Commission Secretary