PORT ANGELES — The Clallam County Opportunity Fund could support $300,000 in annual infrastructure investments through 2048, a financial analysis shows.
The three commissioners on Monday reviewed a 28-year projection for the Opportunity Fund and discussed a $589,473 grant application from the city of Port Angeles to fund sewer, water and other infrastructure for the Port Angeles Waterfront Center.
The Opportunity Fund is a 0.9-percent portion of state’s 6.5-percent sales tax used for infrastructure projects in rural counties.
“We have the ability to do between $290,000 and $300,000 a year from here on out of additional projects,” Clallam County Chief Financial Officer Mark Lane told commissioners in their weekly work session.
“Now we all know that it’s not going to unfold that way. We may have a few years where we have nothing come up, and then we may have something big come along like the PA waterfront structure.”
Commissioners will hold a public hearing Feb. 25 on the city’s Opportunity Fund request, which received an unanimous recommendation from the Opportunity Fund Advisory Board.
“From the perspective of the advisory board, if there was ever a textbook application of Opportunity Funds, this was probably it,” board Chairman Alan Barnard told commissioners.
The Opportunity Fund was enacted in 1998 as the Rural Counties Public Facilities Tax.
Absent legislative action, the tax credit will expire for Clallam County in July 2032.
“Where the rubber really meets the road is understanding projections,” Lane said.
“Assuming that the funding source for this fund dries up in 2032, you’re going to have to leave enough liquidity in the fund to service those future debt payments that go beyond the June 2048 end date of this analysis.”
The Opportunity Fund had a balance of $4.08 million at the end of 2019 and was projected to generate $1.42 million this year, Lane said.
“In the event the PA waterfront infrastructure grant request is approved,” Lane said, “the projected 2020 ending fund balance will be $4.052.”
Since 1998, the Clallam County Opportunity Fund has generated $30.81 million in revenue, Lane said.
That includes $18.25 million from the tax credit itself, $612,000 from interest income and $11.19 million related to debt issuances for Opportunity Fund projects like the Carlsborg sewer, Lane said.
Clallam County has spent $26.73 million on Opportunity Fund projects to date, the largest of which was the $14.5 million Carlsborg sewer.
“It’s important to point out that the Carlsborg sewer loan matures in June 2048, in other words, 16 years after the Opportunity Fund tax revenue ceases,” Lane said.
Lane’s analysis of the Opportunity Fund was based on a 3-percent annual growth in tax revenue, a 1.8-percent interest rate and a 2032 sunset of the Opportunity Fund.
“This is what is always needed when one takes a look into that crystal ball called the future,” Commissioner Randy Johnson said of Lane’s analysis.
Commissioner Mark Ozias said the Opportunity Fund Advisory Board and the Board of County Commissioners had “been operating in a bit of a vacuum without having this level of analysis.”
“The other piece, if we really want to push this to the fullest extent possible, is the financial analysis is half of it,” Ozias said.
“The other half is ‘OK, do we want to put any parameters around how we might want to spend this future revenue stream?’”
Commissioners are expected to meet with the Opportunity Fund Advisory Board in a future work session to discuss Opportunity Fund spending.
Meanwhile, no commissioner objected Monday to the $589,473 grant request from the city of Port Angeles for infrastructure improvements near the Port Angeles Waterfront Center campus.
Barnard said the application was “very well vetted” by the Clallam County Economic Development Corp. and its executive director, Colleen McAleer.
The Opportunity Fund Advisory Board voted unanimously to recommend the grant application Dec. 30.
“We all felt like if there was ever an application that really made sense all the way down the line, this was it,” Barnard said.
The grant would be used to connect the Field Arts & Events Hall and other Waterfront Center buildings to city sewer, water and electrical services.
It also would create curb cutouts for buses and automobiles, provide access to the Olympic Discovery Trail, upgrade a transformer and allow for the installation of a lighted pedestrian crosswalk on West Front Street, according to an executive summary.
Crews broke ground Nov. 12 for the events hall, which is the first piece of the waterfront center campus.
“I continue to be really excited about the project,” Johnson said.
“This, as Alan said, absolutely fits the criteria that one should have for the Opportunity Fund. This is just a wonderful venue.”
Chris Fidler, executive director of the waterfront center, told commissioners that the project is on schedule and on budget. He said 187 pile foundations have been installed.
Concrete for the orchestra pit was poured last week, Fidler said.
“We look to open in 18 months, and we’re very, very pleased with your favorable attention to this very important piece of it, and that is being able to hook up the building to the infrastructure that the city provides,” Fidler said.
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Reporter Rob Ollikainen can be reached at 360-452-2345, ext. 56450, or at rollikainen@peninsuladailynews.com.
