DRAFT - 2022 Operating Budget & Capital Improvement Plan
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
2022
Operating
Budget &
Capital
Improvement
Plan
Por t of A n a c o r te s
DRAFT
Table of Contents
Introduction Environmental Program
MESSAGE FROM THE EXECUTIVE DIRECTOR 2 ENVIRONMENTAL STEWARDSHIP 31
WHO WE ARE/WHAT WE DO 3 ENVIRONMENTAL SITES 32
ORGANIZATIONAL CHART 4
COMMISSIONERS 5
Cash Flow Projections
COMMISSIONER DISTRICT MAP 6
DEFINITIONS & ASSUMPTIONS 33
THE BUDGET PROCESS 7
CASH FLOW PROJECTIONS 2022-2026 34
COVID-19 RESPONSE & IMPACTS 9
Long-Term Debt
Operating Budget LONG-TERM DEBT 39
FINANCIAL OVERVIEW 11
2022 BUDGET SUMMARY INCOME STATEMENT 12
AIRPORT 13 Property Tax
MARINA 15 TAX LEVY: TYPES & USES 41
MARINE TERMINAL 17 2022 TAX AT A GLANCE 42
PROPERTIES 19
2022 COMBINED OPERATING BUDGET 21 Supplemental Information
2022 BUDGET – SUPPLEMENTAL COMPARISONS 43
Capital Improvement Plan (CIP)
OVERVIEW 23
CIP CONSOLIDATED SUMMARY 24
2022 CIP 25
2022 CAPITAL PURCHASES 30
Cover Photos: (Top Left) Anacortes Airport runway aerial (Photo by Steve Berentson), (Top Right) Cap Sante Marina Harbor Office (Photo by Karla DeCamp),
(Bottom Left) Aerial view at Marine Terminal Pier 2 (Photo by Dan Crookes), (Bottom Right) Waterfront Festival Dinner at Port Transit Shed (Photo by Karla DeCamp)
1
Message from the Executive Director
Message from the Executive Director
In partnership with public agencies and private businesses, the Port of Anacortes develops and manages facilities and services which stimulate private job creation and
commerce while protecting the quality of life, needs and desires of area residents.
This is our mission, and it’s more than just words: keeping focused on our mission guides us in all we do. It is at the heart of our work, whether we are maintaining properties
and facilities or attracting and retaining employers in our community. On top of that, we pride ourselves in providing top-notch service and entertaining events while
delivering excellent customer service to our customers, tenants, guests and constituents.
Though it was a challenging year in many ways, we didn’t miss a beat while accomplishing our mission in 2021. Our keys to success were: focus on the mission; always think
critically; communicate the plan; and find a way to YES. We continued to achieve many of our goals, large and small, while remaining nimble and managing the impacts of
the pandemic on the Port’s people and operations.
A short list of accomplishments in 2021 includes completing major improvements at A Dock; finishing the Quiet Cove cleanup; welcoming Rainier Welding as a new industrial
tenant and job creator; hosting Race Week at Cap Sante Marina; providing world-class services at the marina during a record year; earning the Stewardship Award from
the Washington State Auditor; hosting eight free, outdoor summer concerts at Seafarers’ Memorial Park; and much more.
We expect 2022 to have its own challenges, and we are poised to face them head-on while continuing to accomplish our mission. Some of the priorities you’ll see in our
2022 budget reflect ongoing projects as well as additional investments in the properties, facilities, equipment, and people who make our Port successful and our community
great.
We are fortunate to have an outstanding team within the Port and supportive partners whose collaboration strengthens our work as an economic hub, environmental
steward, and community leader. We appreciate the partnership of the City of Anacortes, Anacortes Chamber of Commerce, Northwest Marina Trades Association, Pacific
Northwest Waterways Association, Washington Public Ports Association, Anacortes Waterfront Alliance, Economic Development Alliance of Skagit County, Port tenants,
tribes, Skagit County, the Port of Skagit County, the residents of our Port district, and many others. Together, our hard work, partnership, and dedication to community
builds a strong foundation for the continued health and prosperity of Anacortes and Skagit County.
Thank you for your interest in the Port of Anacortes and our 2022 budget. Please reach out to me at 360-293-3134 or dan.worra@portofanacortes.com if you have any
questions or comments.
Daniel C. Worra
Executive Director
2
Who We Are/What We Do
Who We Are/What We Do
Who We Are
The Port of Anacortes is a municipal corporation of the State of Washington, created in 1926 under provision of the Revised Code of Washington (RCW Title
53 et seq.), to provide for the development and maintenance of harbors and terminals, promote tourism and foster economic activity in its district. With
one of eight natural deep water marine terminal facilities in Puget Sound, its nearly 1,000 slip marina, and its roughly 80 acres of commercial properties,
the Port is instrumental to the success and economic development of the community. The Port is independent from other local or state governments and
has geographic boundaries that consist of Fidalgo, Guemes, Cypress, Sinclair, and neighboring islands, and a small strip of land bordering Padilla Bay up to
and including Samish Island.
A five-member Board of Commissioners elected for four-year terms by Port District voters governs the Port. The Commission delegates administrative
authority to an Executive Director and staff to conduct operations of the Port. The County levies and collects taxes on behalf of the Port as determined by
the Board of Commissioners and acts as treasurer for the Port as defined under RCW 53.36.010.
Industrial Development Corporation of the Port of Anacortes. The Industrial Development Corporation, a public corporation, is authorized to facilitate the
issuance of tax-exempt nonrecourse revenue bonds to finance industrial development within the corporate boundaries of the Port. Revenue bonds issued
by the Corporation are payable from revenues derived as a result of the industrial development facilities funded by the revenue bonds. The bonds are not
a liability or contingent liability of the Port or a lien on any of its properties or revenues other than industrial facilities for which they are issued.
The Port of Anacortes’ five member Port Commission serves as the Board of Directors for the Industrial Development Corporation.
What We Do
The Port provides quality jobs, international trade connections, a strong industrial land base, and economic stability by producing revenue for state and
local services. The Port is authorized by Washington law (RCW Title 53.08) to provide and charge rentals, tariffs and other fees for docks, wharves and similar
harbor facilities, including associated storage and traffic handling facilities for waterborne commerce. The Port may also provide freight and passenger
terminals and transfer and storage facilities for other modes of transportation, including air, rail and motor vehicles. The Port may acquire and improve
lands for sale or lease for industrial or commercial purposes, and may create industrial development districts.
Mission Statement: In partnership with public agencies and private business, develop and manage facilities and services which stimulate private job creation
and commerce, while protecting the quality of life, needs and desires of area residents.
3
Organizational Chart
Organizational Chart
4
Commissioners
Commissioners
Ken Goodwin Commissioner 2021 District 1 Term Expires: December 31, 2021
Commissioner Goodwin was elected Port Commissioner in 2017 and began his term in January 2018. A graduate of the University of Washington, with
bachelor’s and master’s degrees in business administration and accounting, Mr. Goodwin’s career includes 40 years as a Certified Public Accountant,
owner/operator of a chain of retail stores in remote Alaska, Director of Finance for the Alderwood Water and Wastewater District, and Commissioner of the
Woodinville Water District for 17 years. He is a Vietnam veteran and served on the Port’s Marina Advisory Committee before becoming Commissioner.
Jon Petrich Commission President 2021 District 2 Term Expires: December 31, 2021
Commissioner Petrich was elected Port Commissioner in 2017 and began his term in January 2018. Commissioner Petrich is employed as a Project Supervisor
and licensed Lead Vessel Operator at National Response Corporation (NRC). He has two bachelor’s degrees from Eastern Washington University in finance
and economics.
Joe Verdoes Commission Secretary 2021 District 3 Term Expires: December 31, 2023
Commissioner Verdoes was initially elected Port Commissioner in 2015, and began his term in January 2016. Mr. Verdoes was subsequently re-elected in
2019 and began his second term in 2020. Mr. Verdoes is self-employed as a Puget Sound commercial fisherman and local businessman. He has a bachelor’s
degree in business administration from the University of Washington and a master’s degree in developmental studies from Deakin University, Geelong,
Australia. Mr. Verdoes was a member of the Port’s Marina Advisory Committee for seven years. Before becoming a commercial fisherman in 1994, Mr.
Verdoes was employed as an Economic Development Officer for a small Australian community and operated a dairy farm.
Bonnie Bowers Commission Vice President 2021 District 4 Term Expires: December 31, 2023
Commissioner Bowers was elected Port Commissioner in 2019 and began her term in January 2020. Commissioner Bowers is a graduate of Washington
State University and the FBI National Academy. She retired as Police Chief in Anacortes after a 33 year career in public safety. She has a keen interest in
economic development and green industry. Commissioner Bowers is a longtime member of the Anacortes Rotary Club.
Katherine “Kathy” Pittis Commissioner 2021 District 5 Term Expires: December 31, 2021
Commissioner Pittis was elected Port Commissioner in 2017 and began her term in January 2018. Commissioner Pittis had a 21-year career at the Port of
Anacortes, serving in various leadership roles. She served on the Anacortes School Board and on numerous community and regional committees, including
the Governor’s Southern Resident Killer Whale Task Force. Commissioner Pittis currently serves on the Northwest Career & Technical Academy General
Advisory Committee and is the President of the Washington Public Ports Association Executive Committee.
5
Commissioner District Map
Commissioner District Map
6
The Budget Process
The Budget Process
The budget has several major purposes. It converts the Port’s policies and plans, including its Strategic and Comprehensive plans, into services and future
capital improvement projects. It serves as a vehicle to communicate these plans to the public, and once adopted by the Commission, becomes the work
plan to be accomplished during the next fiscal year.
The annual operating and capital budgets are a forecast of expected resources and the purposeful distribution of those resources. This includes the rate of
taxation for the coming fiscal year. The 2022 operating budget was developed based on historical trends in revenue and expenses, information from
customers and tenants, market projections, and key economic and regulatory assumptions. Additionally, the outbreak of the 2019 novel coronavirus
(“COVID-19”) in our region in early 2020 was a significant event that continues to impact the finances, operations, and economy of the Port. (Please see the
COVID-19 Response & Impacts section of this document for further information.) While the Port’s current financial outlook remains positive, the Port cannot
predict the duration and extent of the COVID-19 public health emergency, or quantify the magnitude of the impact on the regional and local economy. This
economic uncertainty as a result of the current global pandemic, shifts in markets (especially those affecting our local refineries), considerable capital
requirements for the Port’s aging infrastructure and development plans, and continued regulatory requirements and environmental risks remain
challenging.
Citizen involvement and understanding of the budget is a major
part of the review process. The Budget Calendar on the following
page provides an overview of the budget process and important
dates regarding its review and adoption.
Jill R. Brownfield, CPA
Director of Finance & Administration
Photo: Cap Sante Marina (Photo by Karla DeCamp)
7
The Budget Process
BUDGET CALENDAR
July
15 Regular Commission Meeting - 2nd Quarter Financial Results & Tax Levy Discussion
23 Mid-Year Update & Budget Kick-Off
August
11 Departments submit draft budgets to Finance
16-20 Departmental budget workshops
19 Regular Commission Meeting
27 5 Year Draft CIP submitted to Finance
September
2 Regular Commission Meeting
3 Preliminary 5 Year Cash Flow complete
7 Directors/Project Managers budget workshop CIP/Cash Flow
10 Final 5 Year CIP and Cash Flow complete
13-14 Special Commission Meeting - Commission Retreat / Port Property Tour & CIP Update
16 Regular Commission Meeting - Budget Assumptions
17 Draft budget available to Commission
October
7 Special Commission Meeting - Budget Study Session
13 Budget revisions from Study Session complete
15 Preliminary budget available to public
20-21 1st public notice; budget hearing scheduled
27-28 2nd public notice; budget hearing scheduled
November
4 Regular Commission Meeting - Budget Public Hearing & Adoption
6 Certify to County Assessor amount of taxes levied; publish final budget
8 Adopted budget available to public
8
COVID-19 Response & Impacts
COVID-19 Response & Impacts
Background
The COVID-19 pandemic, first declared a public health emergency in Washington State in March of 2020, is continuing to affect many parts of the world;
including our state, Skagit County, and the Port of Anacortes. On March 23, 2020, the State Governor issued a statewide “Stay Home, Stay Healthy”
proclamation, requiring individuals to stay home except for essential activities, banning social and other gatherings, and closing all businesses with certain
exceptions for essential businesses. Access to vaccinations through emergency use authorizations became available to first responders, medical
professionals, and other vulnerable populations by the end of 2020, and widely available to people over the age of 12, by April 2021. This prompted
Washington State to follow a phased re-opening approach based on the numbers of the population receiving vaccines. In July 2021, most restrictions were
raised and the State economy fully reopened, however introduction of a new variant of the virus, the Delta variant, has prolonged guidance from the Federal
government, our State Governor, the Center for Disease Control and local health departments encouraging individuals, governments and businesses to take
certain precautionary measures designed to prevent the spread of COVID-19. The Port has
and continues to coordinate its response to the pandemic with the Washington State
Department of Health, as well as the local county public health department.
Operations
After 15 months of closure, the Port re-opened its Main Administrative and Harbor Master’s
Offices to the public on July 1, 2021, while maintaining remote work options for certain
administrative and other staff for whom it is feasible. Despite the many months of closure,
the Port was able to maintain normal business hours to serve customers via phone or email
and Port facilities, such as the Anacortes Airport, Marina fuel stations and the Trailer Boat
Launch, remained open throughout. Following State Governor proclamations, public
meetings returned to in-person on July 1, 2021, with a remote option available.
Ensuring maximum protection for the health and safety of Port stakeholders has been and
continues to be the Port’s top priority during this public health emergency. In July 2020, Port Commissioners and staff adopted a Start Safe Return Plan,
which is still being followed to date. The Start Safe Return Plan, aligned with Washington state guidance, is an implementation tool that ensures Coronavirus
Prevention Practices are deployed to safeguard all stakeholders from biological hazards and address known hazards at all Port facilities. Key elements include
education, social distancing, cleaning and disinfecting, hand washing, and rigid protocol around sick and exposed employees. The Port continues
communicating to customers, visitors, and stakeholders, the importance of staying safe, such as: practicing good hygiene (hand washing, use of disinfectants,
avoiding hand shaking), social distancing, wearing a mouth and nose covering when around groups of people in public and staying home if feeling sick or
unwell.
9COVID-19 Response & Impacts
Potential Financial Impacts
Despite experiencing direct expenses associated with the response to COVID-19 and some negative impact to individual revenue streams, the Port was able
to achieve a net operating income of approximately $150,000 over its original budget in 2020, and progress with its capital improvement initiatives as
originally planned. Nonetheless, the 2021 budget was prepared conservatively, with the assumption that many of the impacts realized in early 2020 would
continue. As presented in the supplemental section, 2021 has largely gone as forecast with the exceptions being an unexpected, record-breaking surge in
activity at the Marina, and to a lesser extent, fuel sales at the Airport. The 2022 budget builds off some of this success, but continues to be conservative by
design, as the full impact of COVID-19 remains uncertain.
Direct expenses associated with COVID-19 include; information technology purchases (additional software licenses and hardware purchases to support
remote work), temporary essential personnel additional pay (in excess of their regular pay rates) for employees who were unable to telework, personal
protective equipment, modifications to facilities (such as sneeze guards and creating additional individual workstations), and execution of a cleaning contract
with an outside vendor. While additional cleaning efforts have become the norm, the majority of direct expenses related to COVID-19 have diminished.
Individual revenue streams impacted by COVID-19 were those affected by restrictions placed on people to stay home and avoid travel and gatherings. In
particular, the price of oil fell sharply in 2020 as a result of a significant decline in global demand. As local refineries decreased production, the Port
experienced a 47% decrease (from budget) in bulk product exports of refinery by-products, petroleum coke and sulfur. This trend seems to have continued
in 2021 despite the lifting of many travel restrictions and a fairly significant increase in oil prices. However, lacking significant input from the Port’s customers,
2022 Marine Terminal export volumes are budgeted similar to 2021.
Restrictions on gatherings also resulted in event cancellations, both in terms of private venue rentals and Port-hosted community events, beginning in mid-
March 2020 and continuing in the summer of 2021. While these cancellations did, and continue to, impact revenues, events comprise less than 1% of the
Port’s total revenues.
On the flipside of these impacted revenue streams, perhaps as a result of people seeking safe outdoor recreation, Marina revenues and Airport fuel sales
have skyrocketed. The Port achieved a record breaking 17,100 guest boater nights in 2020, and is on pace to exceed 18,000 in 2021. There has been no
decline in permanent moorage, with year-round waitlists persisting for slips in excess of 32’. Fuel sales at the Airport are trending 160% ahead of 2020 sales.
Fortunately, the Port has not experienced any material lease defaults among its tenants. Additionally, the Consumer Price Index, which is the basis for many
of the Port’s annual lease rate adjustments, has rebounded significantly in 2021, reaching almost 6% in July 2021.
While the full impact of the COVID-19 pandemic on the Port and the regional economy is uncertain, the Port’s revenue diversity, sufficient debt capacity,
land holdings, and cash reserves position the Port well to continue its mission of economic development and job creation.
10Financial Overview
Financial Overview
Revenues
The 2022 budget reflects total operating revenues of $16.929 million, an increase of approximately 12% from the 2021 adopted budget. While export
volumes of petroleum coke and sulfur remain slightly depressed (a result of decreased production at local refineries), demand for outdoor recreation has
increased significantly, positively impacting Marina revenues and Airport fuel sales. The 2022 revenue projections assume the trends of 2021 will continue,
however, as discussed in the previous pages, the full impact of the COVID-19 pandemic on the Port and the regional economy is uncertain. Consequently,
the Port has not been aggressive with Marine Terminal volumes nor with any additional revenue streams. Additionally, despite very high Consumer Price
Index figures beginning in Q2 of 2021, the Port has estimated lease rate increases of only about 2.5% in 2022. This results in a conservative operating budget
that still produces the needed cash to fund the Port’s anticipated capital improvement initiatives. 57% of the total projected 2022 operating revenue is from
the Marina, 29% is from the Marine Terminal, 11% from Properties and the remaining 3% from the Airport.
Non-operating revenues consist primarily of property tax collections. As directed by the Port Commission, property tax levies fund property acquisition,
industrial development including environmental costs, debt service for general obligation bonds, and public access improvements. The budgeted levy of
$1.709 million reflects a rate of $0.20 per $1,000 of the Port district’s preliminary total assessed value and is a 3% increase over the prior year’s levy, inclusive
of additional revenue from new construction and annexations, etc.
Expenses
The 2022 budget projects operating expenses of $16.715 million, an 11% increase over the 2021 budget. The Port remains committed to process
improvement and providing safe, productive facilities with excellent internal and external customer service. Subsequently, the Port anticipates additional
customer service staff in response to record-breaking activity at the Marina and an information technology assistant to support nearly 24-hour operations.
Additionally, the Port anticipates various challenges contributing to increasing operating expenses; to include, rising inflation, supply chain issues, historic
catastrophic losses in the insurance marketplace causing premium pressure, and increasing demands on the Port’s infrastructure. Included in total operating
expenses is approximately $2.660 million in depreciation, general and administrative (G&A) expenses of $3.521 million, and facilities expenses of $993,000.
G&A expenses are allocated to each operating area as a percentage of total operating expenses. Facilities expenses are allocated based on direct labor
hours.
The 2022 non-operating expenses consist primarily of interest expense on general obligation bonds. The Port has two outstanding general obligation bonds,
totaling $9.180 million. Annual debt service payments in 2022 total $1.576 million, and are anticipated to be paid from operating funds.
Net Income
The 2022 budget reflects a net income, before environmental and capital grants, of $1.790 million. For comparison, the Port achieved $2.074 million in
2020, despite the impacts of COVID-19, and is projecting approximately $2.684 million in 2021. The Port consistently budgets conservatively in order to not
over-extend itself from a capital improvement perspective and to remain nimble in the case of unexpected challenges, and opportunities.
112022 Budget Summary Income Statement
2022 Budget Summary Income Statement
OPERATING REVENUES
Airport $ 540,661
Marina 9,662,487
Marine Terminal 4,879,379
Properties 1,846,374
Total Operating Revenues 16,928,901
OPERATING EXPENSES
Airport 624,818
Marina 7,831,185
Marine Terminal 4,018,946
Properties 1,579,805
Total Operating Expenses 14,054,754
Net Operating Income Before Depreciation 2,874,147
Total Depreciation 2,660,200
NET OPERATING INCOME 213,947
Non-Operating Revenues 1,773,500
Non-Operating Expenses (197,914)
NET NON-OPERATING 1,575,586
Net Income Before Environmental 1,789,533
Photo: Pier 2 at the Marine Terminal (Photo by Karla DeKamp)
Environmental Grants and Recoveries 1,806,400
Environmental Expenses (2,738,500)
NET ENVIRONMENTAL (932,100)
Capital Grants 1,530,000
NET INCOME $ 2,387,433
122022 Operating Budget: Airport
Airport
Overview: The Anacortes Airport serves as a vital link for postal, commercial, recreational and passenger services, primarily to the San Juan Islands. The
Airport is also strategically located for emergency services in the case of natural disasters in and around the surrounding areas.
Building and property leases, hangar rentals, and fuel sales comprise the majority of Airport revenues. While State-imposed travel restrictions due to COVID-
19 initially slowed sales in 2020, a shift to outdoor recreation and a change in pricing strategy, aimed at regional competiveness and a steady turnover in
inventory, has increased fuel sales over one and a half times the previous year. Additionally, while oil prices fell dramatically in 2020, prices have returned,
and are now exceeding, pre-pandemic levels.
Core building and property tenants, most of which are in long-term lease agreements, are Micro AeroDynamics, Aeronautical Services, Northwest Marine
Technology, Inc., Rugby Aviation DBA San Juan Airlines, and 48 Degrees North Aviation. The Port owns and leases forty hangars; a current waitlist of over 65
potential new customers indicates steady demand for this hangar space.
Budgeted revenues in 2022 total $541,000, an approximate 26% increase over 2021-budgeted revenues. The largest factor in this increase, as mentioned
above, is fuel sales, which have skyrocketed in 2021. The budget assumes that the current pricing strategy will continue driving the pace of sales. The Port
also anticipates revenue increases through rates and lease adjustments. Despite current Consumer Price Index (CPI) data indicating rates of over 5%, the Port
has conservatively forecast 2-3% CPI increases in long-term leases, as it is unknown how COVID-19 will further impact the economy. Due to consistent demand,
5% rate increases have been forecast in hangar rentals.
2021 Improvements and 2022 Significant Initiatives:
In 2021, the Port, in cooperation with the FAA, completed a comprehensive obstruction survey in order to enable future projects within the Airport
Improvement Plan, as well as improvements to the Airport’s north tie-down apron area. Pavement improvements outside the operational fence were also
completed to address maintenance and other safety concerns. In response to the COVID-19 pandemic, the United States Secretary of Transportation
announced grant award eligibility to the Airport under two acts, the Coronavirus Response and Relief Supplemental Appropriations Act (CRSSA) and the
American Rescue Plan Act (ARPA). The Port was awarded $49,000 in grant monies through these acts, administered through the FAA, which were used to
fund operational costs, such as personnel, sanitation and janitorial services to combat the spread of pathogens at the Airport. In 2022, the Port will wrap-up
stormwater management feasibility work and begin pre-construction elements on the selected approach to improvements.
132022 Operating Budget: Airport
OPERATING REVENUES
Building & Ground Leases $ 165,186
T Hangar Storage 126,400
Fuel Sales 237,705
Other 11,370
Total Operating Revenues 540,661
OPERATING EXPENSES
Fuel for Resale 206,700
Facilities & Operations 258,764
G&A Allocation 159,354
Total Operating Expenses 624,818
Net Operating Loss Before Depreciation (84,157)
Depreciation 265,494
NET OPERATING LOSS $ (349,651)
Photos: Commissioner Kathy Pittis, Congressman Rick Larsen, Executive Director Dan Worra,
Commissioner Ken Goodwin, Director of Planning,
Properties, & Environmental Brenda Treadwell, Project
Manager Brad Tesch, Director of Operations John Dumas
met at the Airport to highlight the Port’s completed work
using CARES Act funds. (Photos by Karla DeCamp)
142022 Operating Budget: Marina
Marina
Overview: Located in Fidalgo Bay and containing nearly 1,000 boat slips, Cap Sante Marina is one of the Northwest’s premier boating destinations as well
as home to many local commercial fishermen, tour companies, yacht brokerage firms, and other commercial marine businesses. Proximity to the downtown
corridor, exemplary customer service, competitive fuel pricing, and quality amenities result in thousands of visiting boaters throughout the year.
Moorage revenues and fuel sales comprise over 90% of the Marina’s total revenues. While the COVID-19 pandemic initially slowed guest moorage activity,
and impacted overall fuel sales, the desire to recreate outdoors through boating, camping and fishing, has resulted in record-breaking guest moorage and
recreational vehicle nights. The Port recorded over 17,100 guest boater nights in 2020 and is on pace to exceed 18,000 nights in 2021. This represents more
than a 30% increase over pre-pandemic numbers. Permanent moorage, which represents nearly 80% of total moorage, has also been positively impacted.
As of July 31, 2021, the waitlist for permanent moorage numbered almost 400 customers, as compared to about 250 customers at the same time last year.
Customers seeking slips larger than 36 feet in length can expect a 12-24 month wait.
Budgeted revenues in 2022 total $9.662 million. While this is a steep 15% increase over the 2021 budgeted total of $8.393 million, preliminary estimates
for 2021 indicate the Marina may see over $9.827 million in revenues this year. Thus, the 2022 budget is actually conservatively forecast. The COVID-19
pandemic and its effects on the economy remain uncertain. It is unknown if the increase in activity is sustainable or was caused by factors such as the closure
of the Canadian border or other international travel restrictions. The budget accounts for Commission-adopted rate increases for permanent recreational
moorage of 3-7% based on a tiered structure by slip size, and a flat 3% increase for commercial customers. Guest moorage rates are also forecast at 3% rate
increases. Additionally, the Port anticipates completion of its RV Park Redevelopment by summer 2022. Upgraded amenities including full hook-ups result
in an estimated increase in overnight camping revenue year over year.
2021 Improvements and 2022 Significant Initiatives:
In 2021, the Port completed the much-anticipated A-Dock recapitalization project, featuring a modernized mix of concrete floats and galvanized steel piling,
replacing the wood dock originally built in the 1960s. The new commercial dock includes finger piers up to 110’ in length, full utilities, and an upland covered
structure for pedestrians waiting to board tour or charter vessels. While this was the most notable and long-awaited projects, many other crucial process
improvements and maintenance projects were also completed in 2021; including, security camera replacements, access control at restrooms and laundry
facilities, and parking lot improvements at R Avenue and 13th Street addressing safety concerns and providing efficiencies for users of the trailer boat launch,
T-Dock and web lockers.
Aggressive plans continue in capital improvement at the Marina in 2022, with the estimated completion of the RV Park Redevelopment, which features 25,
full hook-up, paved sites and a dedicated restroom facility. The Port anticipates completing extensive repairs to O, P & Q Docks, extending their useful life
8-10 years and providing time to permit and design recapitalization of those northern most docks. Other projects include B-Dock electrical upgrades, an
additional high speed fuel dispenser, and an electric vehicle charging station. In total, the Port intends to invest nearly $7.8 million in the Marina in 2022.
152022 Operating Budget: Marina
OPERATING REVENUES
Moorage $ 5,659,000
Fuel Sales 3,131,864
Operating Grants 3,450
Other 868,173
Total Operating Revenues 9,662,487
OPERATING EXPENSES
Wages & Benefits 1,265,487
Fuel for Resale 2,464,460
Facilities & Operations 2,141,131
G&A Allocation 1,960,107
Total Operating Expenses 7,831,185
Net Operating Income Before Depreciation 1,831,302
Depreciation 1,213,862
NET OPERATING INCOME $ 617,440
Photos: (Top) A Dock Project in Progress (Left) A Dock Ribbon Cutting Ceremony (Photos
by Karla DeCamp)
162022 Operating Budget: Marine Terminal
Marine Terminal
Overview: The Port’s Marine Terminal facility consists of three deep-water working piers, Pier 1, Pier 2, and Curtis Wharf. The Marine Terminal achieves its
revenues through cargo shipments, short and long-term lease of dock space, other ground leases and transient dockage revenue from berthing of vessels,
barges and tugboats.
Pier 1 houses the Port’s historic Transit Shed, currently used as a community events center and administrative offices, as well as providing moorage for a
variety of vessels. In addition, Dakota Creek Industries, a primary tenant of the Port, uses Pier 1 for its floating dry dock in support of its shipbuilding and
repair operations while M&M Seafood operates a seafood processing area.
Pier 2, the primary use of which is exporting dry bulk cargoes, is the most active part of the Port’s Marine Terminal. At 37 ½ feet draft, it is the Port’s deepest
pier. Pier 2 has 14 acres of paved asphalt-cement surfacing, a self-contained stormwater management system, a 460-foot concrete cement frontage pier,
and a stationary ship loader. Currently, the Port’s primary bulk product commodities are petroleum coke and prilled sulfur; both of which are by-products
of the refining process.
Curtis Wharf is a working wharf and dock providing periodic vessel moorage to a range of commercial users, including the American Spirit and American
Constellation cruise ships, which the Port was excited to welcome back for the 2021 season. Curtis Wharf is also home to a seafood processing facility.
Budgeted revenues in 2022 total $4.879 million a modest 3% increase over 2021-budgeted revenues. As mentioned previously, in early 2020, the COVID-19
global pandemic had a devastating effect on oil prices as a result of plummeting demand. With travel and social gathering restrictions slowly being raised in
2021, oil prices are returning to pre-pandemic level. Production levels still appear lower than usual and given the uncertainty around the pandemic and its
true impacts, 2022 bulk product shipments are conservatively estimated at 237,400 metric tons. Tariff increases for other Marine Terminal activity, such as
dockage, has been estimated at 3%, to be adjusted mid-year.
2021 Improvements and 2022 Significant Initiatives:
In 2021, the Port completed infrastructure repair and maintenance at Pier 1 and Curtis Wharf. The work comprised piling repairs, corrosion repairs and
cathodic protection. The final phase of the Curtis Wharf work is anticipated to be done in 2022, along with paving improvements at the entrance to and out
onto the deck of the pier. In addition, the Port plans to install automated gates at Pier 2 and the commercial boat ramp at Wyman’s. Feasibility work on a
maintenance building extension to protect the Port’s mobile equipment is also underway, with construction anticipated in 2022.
Recommendations and findings from the Port’s 2020 Marine Terminal Modernization Feasibility Study is guiding the Commission and staff on future capital
investments. Shore to ship power and a commercial pump out float, for instance, are preliminarily programmed in 2023-2025 of our five-year plan.
172022 Operating Budget: Marine Terminal
OPERATING REVENUES
Terminal Services $ 1,597,349
Handling 2,232,400
Ground Leases 554,178
Other 495,452
Total Operating Revenues 4,879,379
OPERATING EXPENSES
Wages & Benefits 78,608
Longshore/Stevedoring 2,230,170
Facilities & Operations 705,484
G&A Allocation 1,004,684
Total Operating Expenses 4,018,946
Net Operating Income Before Depreciation 860,433
Depreciation 882,206
NET OPERATING LOSS $ (21,773)
Photos: Pier 1 at the Marine Terminal (Photos by Karla DeCamp)
182022 Operating Budget: Properties
Properties
Overview: Properties consists of building and ground leases not associated with the other three operating areas, rental of the Port’s Transit Shed and
Seafarers’ Memorial Park Building, and revenue and expense related to Port-sponsored events.
Over 90% of Properties’ revenues are determined by already negotiated lease rates (many long-term) with increases set by CPI or by a fixed rate. Fortunately
for our community, the Port has not experienced any major lease defaults, indicating financial strength and business continuity amongst Port tenants.
However, as discussed previously, the ultimate impacts of the COVID-19 global pandemic are unknown. While the economy suffered greatly in the initial
months of the virus outbreak, it has rebounded significantly in 2021. Although the national CPI surged to 5.4% in June 2021, a recent rise in cases as a result
of a new variant in the virus raises concerns over the long-term sustainability of this economic growth. The Port has used a conservative 2.3% CPI for 2022
budgetary purposes.
The remainder of Properties’ revenues comes from venue rentals and sponsorship and ticket sales for Port-sponsored events. State-mandated restrictions
on social gatherings and community events began lifting in July of 2021 as vaccines became more widely available. Rental activity for 2022 has been
estimated to return to pre-pandemic levels, including the full return of Port-sponsored events.
2022 Properties revenues are budgeted at $1.846 million, a 16% increase over the 2021-budgeted figure. The Port was extremely honored to welcome a
new tenant, Rainier Welding, to its 2019-purchased Bartholomew property. The growing steel and aluminum fabrication company, based in Redmond, WA,
looked all over the state for a place to expand and landed in Anacortes, bringing 40 jobs and $20 million in annual work.
2021 Improvements and 2022 Significant Initiatives:
In 2021, the Port continued North and West Basin Redevelopment planning efforts, focused primarily on the redevelopment of the RV Park (with full
amenities), an RV Park Restroom Facility, and improved vehicle parking near J-K-L Docks. With those projects all expected to be constructed and completed
in 2022, planning efforts are expected to shift to design of a new building west of the existing Harbor Master’s office, known as Building 5 in the Port’s North
& West Basin Concept Plan. Potential tenants of this building include restaurants, offices, retail, yacht brokers or other marine related businesses. The Port
is also looking to relocate its administrative offices as the Commission announced the closure of the Transit Shed to venue rentals after December 31, 2023.
The Transit Shed is expected to be returned to commercial industrial use and administrative offices would be relocated to allow for a new tenant or tenants
to occupy the entire space.
The Port’s 2022 capital plan also includes preparation of the Rockwell site for future development for which the Port is already receiving inquiries from
potential tenants.
192022 Operating Budget: Properties
OPERATING REVENUES
Property Rents $ 1,696,967
Venue/Event Revenues 107,000
Operating Grants 12,000
Other 30,407
Total Operating Revenues 1,846,374
OPERATING EXPENSES
Wages & Benefits 325,271
Facilities & Operations 857,395
G&A Allocation 397,139
Total Operating Expenses 1,579,805
Net Operating Income Before Depreciation 266,569
Depreciation 298,638
NET OPERATING LOSS $ (32,069)
202022 Combined Operating Budget
2022 Combined Operating Budget
Marine
Airport Marina Terminal Properties Non-Op Totals
OPERATING REVENUES
T Hangar Storage $ 126,400 $ - $ - $ - $ - $ 126,400
Fuel Sales 237,705 3,131,864 - - - 3,369,569
Moorage - 5,659,000 - - - 5,659,000
Terminal Services - - 1,597,349 - - 1,597,349
Handling - - 2,232,400 - - 2,232,400
Building & Ground Leases/Rents 165,186 - 554,178 1,696,967 - 2,416,331
Venue & Event Revenues - - - 107,000 - 107,000
Operating Grants - 3,450 - 12,000 - 15,450
Other 11,370 868,173 495,452 30,407 - 1,405,402
TOTAL OPERATING REVENUES 540,661 9,662,487 4,879,379 1,846,374 - 16,928,901
OPERATING EXPENSES
Wages & Benefits - 1,265,487 78,608 325,271 - 1,669,366
Longshore/Stevedoring - - 2,230,170 - - 2,230,170
Fuel for Resale 206,700 2,464,460 - - - 2,671,160
Facilities & Operations 258,764 2,141,131 705,484 857,395 - 3,962,774
G&A Allocations 159,354 1,960,107 1,004,684 397,139 - 3,521,284
TOTAL OPERATING EXPENSES 624,818 7,831,185 4,018,946 1,579,805 - 14,054,754
NET OPERATING INCOME (LOSS)
BEFORE DEPRECIATION (84,157) 1,831,302 860,433 266,569 - 2,874,147
Depreciation 265,494 1,213,862 882,206 298,638 - 2,660,200
NET OPERATING INCOME (LOSS) $ (349,651) $ 617,440 $ (21,773) $ (32,069) $ - $ 213,947
212022 Combined Operating Budget (continued)
Marine
Airport Marina Terminal Properties Non-Op Totals
NON-OPERATING
Revenues $ - $ - $ - $ - $ 1,773,500 $ 1,773,500
Expenses - - - - (197,914) (197,914)
NET NON-OPERATING - - - - 1,575,586 1,575,586
NET INCOME (LOSS)
BEFORE ENVIRONMENTAL (349,651) 617,440 (21,773) (32,069) 1,575,586 1,789,533
ENVIRONMENTAL ACTIVITY
Grants and Recoveries - - - - 1,806,400 1,806,400
Expenses - - - - (2,738,500) (2,738,500)
NET ENVIRONMENTAL ACTIVITY - - - - (932,100) (932,100)
Capital Grants - 1,530,000 - - - 1,530,000
NET INCOME (LOSS) $ (349,651) $ 2,147,440 $ (21,773) $ (32,069) $ 643,486 $ 2,387,433
22Capital Improvement Plan Overview
Overview
Port Commissioners and Staff developed the 2022 Capital Improvement Plan (CIP) through a robust scoring effort in 2021 for budget years 2022-
2023. This biennial process involves identifying all potential projects, including previously unfunded or backlogged projects, some new, and several
ongoing projects. Some of the projects date back to the Port’s 2008 Comprehensive Plan. The project inventory is reevaluated and prioritized every
other year to best meet the Port’s priorities.
The 2022 CIP continues to focus on deferred maintenance across all operating areas, along with new opportunities within the Marina and newly
acquired properties.
At the Airport, the Port will continue planning efforts towards the maintenance and improvement of the stormwater detention pond, focusing on
exploring underground storage options to eliminate safety concerns regarding potential water fowl attraction.
At the Marina, the Port anticipates completing upgrades to electrical service at B-Dock and installing an additional high speed fuel dispenser at the
fuel dock to increase capacity. Feasibility planning will commence for an outdoor Fish Market at Cap Sante Marina. As a follow-on to a recent condition
report and stakeholder outreach, 2022 will include a focused planning effort for T-Dock Reconfiguration and Replacement.. The North Basin docks,
specifically O, P & Q docks, will undergo repairs to extend useful life, while the Port undergoes planning efforts for a complete recapitalization of
north end docks. The Cap Sante Marina RV Park will be fully upgraded creating a first-rate RV Park with 25 spaces (2 ADA compliant) complete with
dedicated utilities, green spaces, privacy hedges, and a restroom facility. Reconfiguration and paving of the parking lot area that serves J-K-L Docks,
will also be included in the North Basin upgrades in 2022. Cathodic protection at C & D docks, the Pump Out Float and Fuel Dock, and installation of
an electric vehicle charging station round out the Port’s 2022 capital plans for the Marina.
While the recently completed Marine Terminal Modernization Feasibility Study will help to guide the Commission and staff on future capital
investments at the Marine Terminal, 2022 will see a continuation of a number of projects. Port staff will proceed with the final phase of Curtis Wharf
corrosion repairs and cathodic protection system. Pier 2 & Wyman’s Ramp will be receiving automated gates. The Port maintenance building
extension will provide a covered area for storage of the Port’s equipment that currently are exposed to outdoor elements and Curtis Wharf paving
will improve access for upland services that support marine trade activity.
Within Properties, 2022 will bring final design efforts and site development construction efforts to the Rockwell property. Planning efforts will begin
on the NW Basin Building 5 with feasibility work to determine best use.
2022 Capital Procurement primarily includes equipment purchases to replace assets at the end of their useful lives. Included in planned purchases in
2022 are a Sprinter Van for Facilities, an Outboard Motor for spare skiff, a Skid Steer Broom, Crane Loading Cell, HDP Butt Welder, Brivo Access at the
Airport, Main Port Office, and Pier 2 Main Gate, Brivo Controls at P/Q and T Docks, security cameras at Curtis Wharf and Bartholomew, and fiber
cable installation at C, D, E and F Docks.
232022 CIP Consolidated Summary
CIP Consolidated Summary
TOTAL PROJECT FUNDING
Prior Year(s) Project Carry Current Year Project Current Year Cash
Cost Center PORT GRANTS
Forward Budget Expenditures
Dollars Dollars
Airport $ 55,000 $ - $ 55,000 $ 55,000 $ -
Marina 6,555,000 1,201,000 7,756,000 6,226,000 1,530,000
Marine Terminal 635,000 350,000 985,000 985,000 -
Properties 200,000 1,815,000 2,015,000 2,015,000 -
Capital Procurement - 205,500 205,500 205,500 -
Total for All Projects $ 7,445,000 $ 3,571,500 $ 11,016,500 $ 9,486,500 $ 1,530,000
242022 Airport CIP
2022 CI P
Airport CIP
Prior Year(s) TOTAL PROJECT FUNDING
Current Year Current Year Cash
Project Title Project Type Project Carry PORT GRANTS
Project Budget Expenditures
Forward Source Dollars Source Dollars
Airport
Stormwater
Tax
Improvements Facility M&R $ 55,000 $ - $ 55,000 $ 55,000 --- $ -
Fund
(Design and
Permitting)
Total Airport Projects $ 55,000 $ - $ 55,000 --- $ 55,000 --- $ -
252022 Marina CIP
Marina CIP
Prior Year(s) Current Year Current Year TOTAL PROJECT FUNDING
Project Title Project Type Project Carry Project Cash PORT GRANTS
Forward Budget Expenditures Source Dollars Source Dollars
Economic
Marina Fish
Development/
Market $ - $ 30,000 $ 30,000 Tax Fund $ 30,000 --- $ -
Community
(Feasibility)
Development
Skagit
B-Dock Electrical General
Facility M&R 625,000 105,000 730,000 230,000 County 500,000
Upgrades Fund
.09 Fund
North Basin Docks
General
O-P-Q Float Rehab Facility M&R 800,000 155,000 955,000 955,000 --- -
Fund
(Construction)
Additional High
Speed Fuel Economic General
100,000 - 100,000 100,000 --- -
Dispenser Development Fund
(Construction)
Cap Sante Marina
Economic General
RV Park 3,470,000 - 3,470,000 2,470,000 RCO 1,000,000
Development Fund
Redevelopment
Cap Sante Marina
Economic General
RV Park Restroom 660,000 330,000 990,000 990,000 --- -
Development Fund
Facility
Subtotal Marina Projects $5,655,000 $ 620,000 $ 6,275,000 --- $4,775,000 --- $1,500,000
262022 Marina CIP (continued)
Prior Year(s) Current Year TOTAL PROJECT FUNDING
Current Year
Project Title Project Type Project Carry Cash PORT GRANTS
Project Budget
Forward Expenditures Source Dollars Source Dollars
N/W Basin
Development - Community General
$ 750,000 $ - $ 750,000 $ 750,000 --- $ -
Cap Sante Marina Development Fund
Parking Lot (JKL)
C & D-Dock Steel
General
Piling Cathodic Facility M&R - 336,000 336,000 336,000 --- -
Fund
Protection
Fuel Dock and
Pump Out Float
General
Steel Piling Facility M&R - 25,000 25,000 25,000 --- -
Fund
Cathodic
Protection
Electric Vehicle Community
- 70,000 70,000 Tax Fund 40,000 WSDOT 30,000
Charging Station Development
North End
General
Recaptialzation Facility M&R - 50,000 50,000 50,000 --- -
Fund
(Feasibility)
T-Dock Economic
150,000 100,000 250,000 Tax Fund 250,000 --- -
(Feasibility/Design) Development
Total Marina Projects $6,555,000 $1,201,000 $7,756,000 --- $6,226,000 --- $1,530,000
272022 Marine Terminal CIP
Marine Terminal CIP
Prior Year(s) TOTAL PROJECT FUNDING
Current Year Current Year Cash
Project Title Project Type Project Carry PORT GRANTS
Project Budget Expenditures
Forward Source Dollars Source Dollars
Pier 2 &
Health & General
Wyman's Ramp $ - $ 260,000 $ 260,000 $ 260,000 --- $ -
Safety Fund
Automated Gates
Curtis Wharf
Corrosion
Repairs and
General
Cathodic Facility M&R 350,000 - 350,000 350,000 --- -
Fund
Protection
system
(Phase 2 of 2)
Port
Maintenance General
Facility M&R 150,000 - 150,000 150,000 --- -
Building Fund
Extension
Curtis Wharf General
Facility M&R 135,000 90,000 225,000 225,000 --- -
Paving Fund
Total Marine Terminal Projects $ 635,000 $ 350,000 $ 985,000 --- $ 985,000 --- $ -
282022 Properties CIP
Properties CIP
Prior Year(s) TOTAL PROJECT FUNDING
Current Year Current Year Cash
Project Title Project Type Project Carry PORT GRANTS
Project Budget Expenditures
Forward Source Dollars Source Dollars
Industrial Park at
Economic
Rockwell (Site $ 200,000 $1,665,000 $1,865,000 Tax Fund $ 1,865,000 --- $ -
Development
Preparation)
NW Basin Bldg 5 Economic General
- 150,000 150,000 150,000 --- -
(Design) Development Fund
Total Properties Projects $ 200,000 $1,815,000 $2,015,000 --- $ 2,015,000 --- $ -
292022 Capital Purchases
2022 Capital Purchases
Prior Year(s) TOTAL PROJECT FUNDING
Current Year Current Year Cash
Project Title Project Type Project Carry PORT GRANTS
Project Budget Expenditures
Forward Source Dollars Source Dollars
Miscellaneous
Capital Purchases
General
within Equipment $ - $ 205,500 $ 205,500 $ 205,500 --- $ -
Fund
Executive Director
Authority
Total Capital Procurement Projects $- $ 205,500 $ 205,500 --- $ 205,500 --- $ -
Photo: Pier 1 Aerial (Photo by Karla DeKamp)
30Environmental Program
Environmental Stewardship
Environmental Stewardship
The Port of Anacortes is committed to protecting and enhancing the natural environment through implementation of a proactive environmental program
of prevention, remediation and education. Our strategies encompass:
• The development and implementation of preventative measures to lessen the possibility of environmental damage or degradation.
• The identification and rehabilitation of environmental damages or degradation on Port properties.
• The orientation and education of staff, tenants and the general public regarding environmental requirements and issues.
• Participation in voluntary environmental stewardship programs and certifications.
After three consecutive years at the silver level, the Port of Anacortes was awarded the Northwest Clean Air Agency (NWCAA) Partners for Clean Air Gold
Award. The Gold Award recognizes business in Island, Skagit and Whatcom counties that demonstrate at least three consecutive years of compliance with
air quality regulations and implemented additional clean air practices. Of more than 490 businesses registered with NWCAA, the Port is one of only six
businesses in Skagit County to earn the Gold Award in 2021.
Clean Marina
Cap Sante Marina is EnviroStars certified under Clean Marina Washington which is an incentive-based certification program in which marinas assess their
operations and implement improvements to better protect the environment. Clean Marina Washington provides marina best management practices (BMPs)
that are practical and affordable actions that can reduce pollution at the source. By effectively implementing BMPs, marinas and marina tenants may be
able to avoid more expensive and restrictive measures being placed on the boating public by regulatory agencies. In 2021, the Port was recertified as a Clean
Marina with goals to implement EPA safer choice cleaning products, encourage the use of the marina as a natural classroom, and to implement SeaBin to
help remove debris from the marina basin.
Green Marine
To benchmark and further improve its environmental performance, the Port’s Marine Terminal became a Green Marine participant in 2019 and underwent
self-evaluation with external verification in 2020. Green Marine is an environmental certification program for the North American marine industry dedicated
to advancing environmental excellence. The program stems from a voluntary initiative by the maritime industry to exceed regulatory requirements. Green
Marine is a rigorous, transparent and inclusive program that targets prioritized environmental issues such as greenhouse gases, community impacts, and
water and land pollution. In 2022, the Port is committed to improvements in greenhouse gases, stormwater, and spills prevention through the Green Marine
program.
31Environmental Program
Environmental Sites
Environmental Sites
The Port of Anacortes has identified six contaminated sites on various Port properties that require investigation, and potential remediation, in order to
comply with state environmental laws and regulations. Since 2008, the Port, in partnership with the Washington State Department of Ecology (DOE), current
and former tenants and their insurance carriers, former site operators, and the Port’s own historical insurance carriers, has completed in excess of $65
million in clean-up actions.
To date, clean-ups have occurred and are significantly completed at the Cap Sante Marine site, the in-water portion of Dakota Creek Industries Shipyard
(DCI), the former Scott Paper Mill site, and the former Shell Tank Farm site. The former Scott Paper Mill site was completed in 2011 and the Port plans to
complete the DOE required 10-Year Sediment Sampling and Mitigation Monitoring work in 2022. In total, the Port has forecast $110,500 in post-construction
monitoring costs associated with these sites in its 2022 non-operating budget.
The remaining sites, which are in various stages of remedial investigation, feasibility studies, alternative analysis or remediation activities, include the
uplands portion of DCI, the former Pier 2 Log Haul Out site (also known as “Log Pocket”), and the Quiet Cove site. The latter, purchased in 2013, is located
adjacent to Curtis Wharf. To fast-track economic development, the Port in cooperation with its funding partners, including DOE, developed an interim action
for remediation activities which commenced in August 2020.
In 2022, the Port anticipates commencement of remediation activities on the uplands portion of DCI, as well as alternative analysis and further remedial
investigation of the in-water portion of Quiet Cove. Continued remedial investigation and alternatives analysis on the Log Pocket site round out the 2022
environmental clean-up cost budget which totals $2.628 million.
Voluntary Cleanup Program: Wyman’s Aquatic Habitat Mitigation Site
In 2015, the Port embarked on a cleanup project on the far east end of the Port’s Marine Terminal. This project provides compensatory mitigation for
adjacent development. Through cooperation with DOE’s Voluntary Cleanup Program, the Port excavated 13,550 cubic yards of upland and intertidal material
to provide high-quality intertidal habitat along the Guemes Channel. Post-construction monitoring continues, with consistent evidence that the site is
meeting its established functional objectives.
Model Toxics Control Act (MTCA)
Critical to the ongoing success of the environmental remediation program is the funding of clean-up activities by the Model Toxics Control Act (MTCA),
which is funded through several different mechanisms, including a tax assessed on hazardous materials. In recent years, MTCA fund balances were
significantly overspent (due to a variety of factors including reduced revenues from historically low prices on petroleum products), but through concerted
efforts at the state level, shortfalls were covered with bond packages and the Port has continued to receive necessary awards to advance clean-up projects
each biennium. The Port currently has over $4.4 million in grant awards, guaranteed through June 30, 2022. MTCA funding continues to be a legislative
priority for the Port.
32Cash Flow Projection: Definitions & Assumptions
Definitions & Assumptions
Port Funding Sources
• General Fund: Non-restricted cash fund derived from Port operations and used for the daily operation of the Port.
• Construction Fund: Non-restricted cash fund used to collect money for future construction projects. Capital projects outlined in the Capital
Improvement Plan to be funded by the General Fund are financed with cash from this source.
• Property Sales Proceeds Fund: Restricted cash fund derived from proceeds from the sale of surplus Port properties. The Port Commission restricts
the use of this fund for property acquisition and/or industrial development.
• Environmental Fund: Non-restricted cash fund which is an accumulation of cash receipts related to cost recovery settlements with third parties
regarding environmental remediation costs. These funds are set aside to be used for current and future environmental remediation and cleanup
costs. The Port is currently teaming with the Washington State Department of Ecology on “Focus Fidalgo” which includes long-term post-
construction monitoring and clean-up of six sites in the Port District over the next few years.
• Property Tax Fund: Restricted cash fund which is an accumulation of property tax revenues received. Uses of this fund are property acquisition,
industrial development including environmental costs, debt service for general obligation bonds and public access, as established by the Port
Commission.
Estimated Cash from Operations
Estimated cash from operations is the result of Net Operating Income less Depreciation plus capitalized and reclassified wages. Net Operating Income is the
result of operations from the Port’s operating areas: Airport, Marina, Marine Terminal and Properties. In general, these operating areas are expected to
generate sufficient revenues to pay for operating costs including normal maintenance and repair, allocation of general and administrative costs and debt
service on capital projects.
Interest Earned on Investments
Interest income is budgeted conservatively for 2022. Estimated interest earnings in future years were calculated based upon estimated average investment
balances and current interest rates of less than 1%.
Operating Reserve
Operating reserve is established by Commission resolution and is currently based upon a three-month average of historical monthly expenditures.
33You can also read
