PORT ANGELES — The sale of city-owned downtown property to the Lower Elwha Klallam Tribe for a $25 million, 86-room hotel has been delayed for up to 90 days — by mid-October — while the tribe determines the extent of environmental contamination at the site, tribal Executive Director Michael Peters said last week.
The tribe plans to build a four-story, four-star hotel with indoor and outdoor restaurants, meeting space, a bar and a parking garage on the parcel that includes 111 E. Front St. and 110 E. Railroad Ave.
Peters will give an update on projects the tribe is involved in at the Port Angeles Business Association breakfast meeting at 7:30 a.m. Tuesday at Joshua’s Restaurant, 113 DelGuzzi Drive.
Peters said tribal officials will be able to further assess the hotel project after a report on the contamination is completed, which should be by the end of this week.
Construction, targeted for the end of this year depending on negotiations and permitting, is now slated to begin by spring 2020, Peters said.
“We’ve had a slight delay of 60 to 90 days here as it all unfolds,” he said.
“We’ve always said six months of permitting and planning and 18 months to two years of construction if everything falls into place on construction time.”
The report is a follow-up of a 2004 site environmental assessment prepared for the Port of Port Angeles that cited fuel-tank pollution and asbestos-containing building materials at the site.
“There absolutely was more contamination than we thought,” Peters said last week.
“We are going through what appears to be nothing that in particular will stop the sale.
“It’s just a matter of us doing our due diligence and making sure about what we are getting into,” he said.
The project would displace Harbor Art Gallery, Budget Car Rental, Avis Rent a Car, Dungeness Bus Line, the Celestial Espresso coffee stand and Cock-a-Doodle Doughnuts.
When the tribe announced April 28 that it intended to purchase the property, Peters and city Community and Economic Development Director Nathan West had said the goal was to complete negotiations by mid-June.
The city declared the property, which includes 97,998 square feet of building space, surplus in 2008.
After seeking potential buyers earlier this year, the City Council authorized City Manager Dan McKeen to begin negotiations on the tribe, which had proposed the hotel.
Negotiations have yet to begin on the sale, West said last week.
“We’ve talked and had discussion,” he said.
“I’m quite confident we are going to be hearing from the Lower Elwha very soon.”
Peters declined to comment on financing for the project.
“I can’t speak to where the money is coming from, not at this time,” he said.
He said that $2.5 million the tribe received to settle a lawsuit against the state of Washington over the unearthing of the Tse-whit-zen village site off Marine Drive is not being used for the project.
Most of those funds have been spent, tribal Chairwoman Francis Charles said in a Jan. 7, 2012 Peninsula Daily News interview.
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Senior Staff Writer Paul Gottlieb can be reached at 360-452-2345, ext. 55650, or at pgottlieb@peninsuladailynews.com.
