The Port of Kennewick is in a strong financial condition despite the slow economy, port commissioners were told earlier this week.
"Our port is not cutting staff, requiring furloughs or facing budget issues. We are not looking at selling off good operating assets to cover an immediate cash need which is the new trend in governments," said Tammy Fine, port director of finance/auditor.
"The port is facing a very productive year and has plenty of great projects for staff to pursue," she added while reviewing the port's proposed 2011 budget.
Those projects include:
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-- Looking into buying a riverboat to moor off Clover Island to use for concerts, meetings, weddings and receptions, up to $58,000.
-- Clover Island improvements, including Plaza South, a mixed-use development, $1.4 million.
-- A development building in West Richland, $1 million to $1.5 million.
-- Richland's Badger Mountain South, a walkable and sustainable community, including a wine village, $305,000.
The proposed budget includes a beginning cash balance of $7.46 million. Anticipated revenues from industrial and agriculture leases, marina leases and fees for hauling boats out of the water and airport leases add up to $908,023. Fine said she expects the port to receive another $4.15 million from property sales, interest and property taxes.
Although the port anticipates bringing in more money in property taxes, the cost to property owners will remain at 34 cents per $1,000 of assessed value. The proposed 2011 budget anticipates the port receiving $2,925,000 in property taxes compared with $2,630,162 in 2010.
"That's because there's been so much new construction within the port district. We're able to spread the tax out over more people," said Tim Arntzen, port executive director. After maintenance and operating expenses, the port expects to have $8.88 million in available money in 2011. It is to be used to pay for projects and equipment and promotional expenses, leaving $3.44 million in reserves and unrestricted funds.
The 2011 budget plan reflects an 11 percent increase from the 2010 budget. Total available funds in the 2010 budget were $7,603,827.
Commissioner Gene Wagner, after hearing the budget presentation, "At all other meetings I attend other ports are struggling year to year. Kudos go to our hard working staff."
Commissioner Skip Nova-kovich, agreed, saying the port staff did an excellent job.
"They found a way to cut out $76,000 in expenses while ... keeping people," Nova-kovich said. "In 2011 we need to look at projects that less rely on taxes and more on revenue."
Some of the ways Arntzen and his staff were able to cut the $76,000 included:
-- Making changes to the health care plans for port employees.
"We saved some $14,400 by voluntarily going from offering five providers to fewer, more reasonably priced policies," Arntzen said.
-- We also decided to not participate in the Pacific Northwest Waterways Association, a trade group, which saved us $1,400 in membership fees," he said.
-- "Every year we have to blow the water out of the fire system at the marina, just like you do irrigation lines. We used to have a professional company come do it, but we learned how to do it ourselves and now have our maintain crew do it, which saves $2,600," Arntzen said.
The staff hopes to find enough money in the 2011 budget to retain as a regular employee an intern who's been working for the port for several years while attending college.
"Fortunately part of his salary was underwritten first by Columbia Basin College and now by Washington State University Tri-Cities, so he's been a bargain," Arntzen said. "Unfortunately for the port he has to graduate."
"He's been a very valuable asset and I think we can (keep him)," he said.
The commissioners are expected to vote on the proposed budget Nov. 23.
In other business:
-- Loren Combs, a Tacoma attorney representing the Tacoma-based developer, VSI Development, gave an update on the Badger Mountain South project.
Novakovich said once it's finished, in the next 20 years or so, Badger Mountain will be like a 1,000-watt light bulb compared to the candle of California's Napa Valley.
"It'll be a regional draw," he said.
-- Commissioners approved a study by PND Engineers of Seattle to explore the feasibility of another tourism draw, a riverboat moored at Clover Island.
Larry Peterson, port director of planning and development, said the study will cover costs of building a mooring, the necessary permits, maintenance and operational costs. The commissioners approved PND expenses up to, but not exceeding, $58,000.
"This is just the first step. (Port commissioners) could put the brakes on the whole project if they find a fatal flaw," Peterson said. "Their task will be to identify the true costs to the port."
"The riverboat has a 50-50 chance of coming to fruition," said Arntzen.