PORT TOWNSEND — The Port of Port Townsend commissioners have unanimously approved a 2019 operational budget of $6.194 million, representing a modest increase in revenues of $383,000.
The budget focuses on aligning business practices and objectives to support major capital needs and long-term financial stability, officials said.
Interim Executive Director Jim Pivarnik said the biggest concern is a number of major capital projects that have been on the table for a long time and will need to be addressed during the next budget cycle.
“Many of our facilities, like those across the nation, were built during the “golden age” of infrastructure construction and subsequent economic growth between the 1930s and early 1960s.
“The challenge is easily stated, but difficult to remedy: We lack enough resources to restore, replace or repair aging infrastructure.”
He said that the port will focus on six goals: building net operating revenues through a combination of growing revenues and reducing expenses; leasing all vacant spaces in each of the port facilities; complete infrastructure upgrades at the Jefferson County International Airport while federal funds are still available; create and adhere to a leasing policy for all port properties; develop and execute a long-term solution the the stormwater issue; and cultivate, nurture and improve relationships with community partners.
Pivarnik cautioned that current revenue streams are inadequate to fund the projects that need attention. Management responses could include increasing rates and fees, cutting overhead expenses, surplussing non-performing assets that do not advance the mission of economic development, and aligning expectations with realities.
Commissioners Steve Tucker, Pete Hanke and Bill Putney heard audience comments from three speakers, with about 40 people attending the Wednesday public hearing.
The 2019 budget reflects total operating revenues of $6.194 million, an increase of 5.2 percent or $319,000 from the 2018 budget. The goal is to grow operating revenue and net operating income each year while controlling expenses.
Operating expenses are budgeted to be $5.038 million, a 4.4 percent decrease from the prior year’s budget or $222,277. A reduction in staffing, contract service, legal and auditing, operating supplies, advertising and utilities helped with the decrease, although there were increases in staffing costs and benefits.
The commissioners agreed to use the Consumer Price Index (CPI) in factoring moorage and yard rates, and leases, for an increase of 3.5 percent.
Boat Haven moorage will increase $82,989 in permanent moorage due to the CPI increase as well as a projected increase in occupancy and utilization. Monthly moorage will contribute nearly $49,000 during the winter season.
Boat Haven yard revenue will show a slight increase by $33,404 although shipyard storage revenue is anticipated to decrease 5 percent do to the loss of a key tenant.
Point Hudson RV Park revenue is expected to increase by $22,000, and moorage is budgeted for an increase of $91,503.
Income from the Quilcene Marina & RV Operations is expected to be $13,810, while income from operations at the Jefferson County Airport is projected to be $5,984.
Capital projects slated for 2019 include $100,000 for Boat Haven work yard resurfacing to come into compliance with state water quality standards. The tide gate repair/replacement project, which is budgeted at $30,000, could be as high as $100,000.
The New Day Fisheries reroofing project is estimated to be $38,000. Installing water meters to measure usage by tenants and the port is estimated to be $30,000. The Boat Haven backflow preventer project is estimated at $30,000.
The Boat Haven restroom project to improve the facility is budgeted at $18,000.
Point Hudson capital projects include improving the air quality in the state Department of Fish and Wildlife building for $95,000. An estimated $250,000 will be held in reserves to repair the south jetty.
In Quilcene, the Coast Seafoods reroofing estimate is $48,000 and water and septic system improvements to ensure contractual and regulatory compliance could run as high as $15,000.
Capital projects at the airport include the runway rehabilitation project that is being funded by the Federal Aviation Administration at 90 percent. The final phase of the replacement of the 30-year old runway is estimated at $4 million. Another 5 percent in funding is expected from the state Department of Transportation. The airport stormwater and ditch cleaning project will be done concurrently with the runway rehab.
Charley Kanieski addressed the commissioners during public comments, urging them not to accept the budget as proposed. He said that cutting expenses was a good start but that the document lacks “accuracy and transparency.”
He said the operating budget shows non-operating income but omits non-operating expenses for capital projects on the summary.
Jeff Kelety representing the moorage tenants said there was a disparity between the expense for transient moorage tenants and permanent moorage tenants. He suggested more staff time and resources be used for the transients tenants and argued that their rates should reflect that disparity.
George Yount said that Pivarnik has “calmed the waters, but the next executive director will have to walk on water.”
Jefferson County Editor/Reporter Jeannie McMacken can be reached at 360-385-2335 or at [email protected].