The Port of Astoria, which is about $260,000 behind on a project to refurbish the east side of Pier 2, seems to have avoided potentially losing a $1.25 million grant from the state of Oregon to help in the effort.
The Port Commission, at its Tuesday meeting, voted 3-2 to move forward with a non-binding action plan that would explore leasing the southeastern portion of Pier 2 to Da Yang Seafoods and Bornstein Seafoods in exchange for their helping pay for its restoration.
We're hearing from Salem that if we don't take action, we might lose the grant, said Commissioner Jack Bland about the potential of losing the Connect IV grant from the Oregon Department of Transportation. I'm not very anxious to see that grant go away.
We have a chance to get the financing in place to get our pier back, and I think we ought to do that.
Bland, along with Dan Hess and Larry Pfund, voted yes on the motion. Commissioner Bill Hunsinger voted no, while Floyd Holcom abstained.
Pfund said there were no leases on the table for the Port to sign, and that the Commissions decision is simply a show of good faith to the state so it doesnt lose the grant money. The next Port Commission, he said, will make the decisions on any potential leases.
There were three proposals on the table for the Port Commission:
Lease Da Yang an area 285 by 135 feet on Pier 2s eastern side in exchange for it paying $241,000 toward the improvement of that space, while adding more than $109,000 annually to the Ports revenues;
Keep Da Yangs proposal, shift it north on Pier 2 and add in another from Bornstein, which would be leased an area 150 by 135 feet in exchange for paying $127,050 in total, more than $368,000 would be taken off the projects cost, while more than $145,000 in annual lease revenues would be added;
Keep Pier 2 open and explore the concept of a cold storage facility at the Astoria Regional Airport and and a container loading yard on the south end of Pier 2, albeit with no proposals or backing for construction.
My suggestion is to go with the most affordable means, which is the combination of the Bornstein and Da Yang proposals, said Mike Weston, director of business development and operations. He said the state wanted a plan on Pier 2 from the Port in April, but the Commission declined to vote on a previous Da Yang proposal and directed him to explore the possibilities on Pier 2.
The Port was awarded the ODOT grant, including its $250,000 match requirement, in August to refurbish 650 feet of the deck on its southeastern side.
The cost of the project, which was originally awarded to Bergerson Construction with a bid of $1.13 million, ballooned to $1.72 million after further inspection revealed more work needed on the substructure holding Pier 2 up.
That left the Port, which has found ways to use in-house labor, cruise ship revenue and legal settlement money to meet its $250,000 match requirement, scrambling to cover approximately $470,000 in overages between the cost of the project and the grant amount. Through the use of its own labor and material reductions, the Port was able to lower the projects overage to $260,000.
Longshoreman Chris Connaway said hes not against Bornstein moving cargo, but hes against leasing out valuable dock space for the two processors, adding that any new facilities of theirs could be built farther inland. He added that a lame-duck Port Commission, with three members leaving this June, should not be making any momentous decisions or rushing into bad leases.
You cant come into this room, sit down and give away what you want to give away, said Hunsinger, who has long supported the cold storage concept. He referenced a list of 22 potential customers, many of whom he added were willing to throw in major money on such a facility. The Ports staff, budget committee and Commission, he said, needs to sit down and not leave the table until theyve figured out another way to cover the overage on the Connect IV project.
Bland and Pfund both responded that pursuing the seafood processors proposals doesn't mean the Port cant still eventually develop a cold storage facility.
Pfund said the state has backed the Port on expanding the seafood cluster of four processors on and around Pier 2, adding that there are projects in the works for Pier 3 and North Tongue Point. I dont think were ever going to run out of docks for exporting when the customers come.
In other news:
The Port Commission renewed a lease with World Class Fishing, owned by Andy Bentnar, at the Chinook Building. Weston said company had been looked into by law enforcement for undisclosed issues, but that the investigating officer told him he found no issues that would warrant not renewing the companys lease, which ends Jan. 31, 2015.
It passed the supplemental budget from this fiscal year, which ends June 31. Holcom, who abstained from voting and took several chances to criticize CEO?Hank Bynaker, took issue with the lack of long-range financial analysis hes provided.
Bynaker said while recently visiting Seoul, South Korea, to drum up private investment at the Port, he met with an asset management company with $2.8 billion of investment capital. He said the company would be willing to invest upward of $100 million at North Tongue Point if the Port can show a potential project vetted by a reputable company. He added that on May 20, the Port met with Westerlund Log Handlers Chinese partners. He said the chances of getting private investment to rehabilitate Pier 3 look promising.