Port of Port Townsend to rethink Point Hudson jetty funds

Call goes out for donations to fill gap between low bid, cost estimate

PORT TOWNSEND — All four bids to replace the Point Hudson south jetty were over cost estimates, so Port of Port Townsend commissioners delayed action on Tuesday and called for help from community “angels.”

The three commissioners directed staff to come back to the commission at a meeting set for 5:30 p.m. May 23 with actionable items to be considered. If commissioners see enough progress on fundraising, then they could consider a decision to move forward with the jetty project, delay it, or pull it.

The commissioners hope to realize financial commitments of $1.3 million from community benefactors and government agencies.

Executive Director Sam Gibboney said all four bids opened Monday came in over the cost estimate.

“An analysis of the entire project’s costs, the remaining engineering oversight, construction management and a reasonable contingency, the lowest bid exceeds available funds by $1.311 million,” Gibboney said.

Director of Planning Eric Toews told commissioners that American Construction Company of Tacoma was the apparent low bidder at $3,991,119.

Toews said that is approximately $285,000 over the engineer’s probable construction cost estimate of $3.709 million.

Commissioners put off action on a proposed resolution authorizing the issuance of limited tax general obligation bonds not to exceed $3.4 million to finance replacement of the south jetty at Point Hudson.

The deadline for notifying companies of acceptance or rejection of bids is June 7, Gibboney said.

Gibboney said that to move forward with the project, the port would “need to immediately seek donations to cover the funding gap.

“For this to be a viable option, donations would have to be in a special fund dedicated to the jetty by Thursday, June 6. We could delay award of contract until the following day, otherwise we will have to reject all bids.”

Commissioner Pete Hanke said he needed the funds to be in hand or committed before he would consider awarding the bid.

“If we walk away, we are shelving a half-million dollars in design work,” Hanke said. “It’s a restart.

“We should increase the bond to $3.7 million. What is the cost of cash flow over the next 20 years. vs. shelving and restarting? We should look at our cash flow and restart in 2020.”

Commissioner Bill Putney said he is concerned about the port’s low cash reserve.

“The amount of the donations to date are de minimis when you consider we are roughly $1.3 million off,” Putney said.”We need either some big, huge donor, or the city or county step up and actually take this seriously.

“Given the port’s current financial condition, unless it radically improves, we won’t be able to do this project. Period. Full stop.”

Putney said he doubted the port would find a source of an extra million dollars in the time period that was discussed.

“If that’s where we are, ignoring the fact that in three or four years, the cost of doing this project will undoubtedly not stay the same. It’s going to be higher. We’re kind of at the do-or-die point.

“We need to find the missing money or some way to indemnify us against some hazards in this. Or own up to the idea that we just can’t do it.”

Commissioner Steve Tucker encouraged port officials to find other sources of funding.

“I’m the eternal optimist,” he said.

“Transportation Investment Generating Economic Recovery (TIGER) grants (from the U.S. Department of Transportation) are available,” he said.

“There are some options for us to go to Commerce; they’ve been successful in getting other people grants — this is definitely a Commerce thing. Go to the Legislature, there’s a batch of money in there. Let’s see what they can do. I think without losing what we’ve got in there so far, we should go ahead and apply for the extension.”

He advocated getting in touch with Rep. Steve Tharinger, a Democrat from Sequim who chairs the House Capital Budget Committee “to see what he can do to get legislative money rather than bonds or the community digging into their pockets. See if this, with a couple modifications, would fall under the transportation grant.

“We need to do more research and if we can identify something, then perhaps the rest of community will call Tharinger on our behalf,” Tucker said.

Gibboney outlined next steps and offered four possible scenarios for the commissioners to consider.

“First, immediately seek donations,” she said.

“Delay the project for one year. That would involve asking for a one-year extension and know that the granting agency (Boating Infrastructure Grant Program thorough U.S. Fish and Wildlife) will want to understand what our plan is for filling the funding gap. It is not a guarantee. It’s possible we can reexamine the design. The granting agency has paid for the design and permitting so at this point they will not pay for it a second time.

“We also should develop a risk communications strategy for marina management.

“The third option is to delay the project indefinitely. That would likely mean repayment of the federal grant of $176,000.

“An option not recommended by staff, is that you could increase the bond amount to $4.2 million and have $500,000 to replace the cash. We believe there would be questions from the rating agencies about our ability to make payments.”

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Jefferson County Editor/Reporter Jeannie McMacken can be reached at 360-385-2335 or at [email protected]

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