Port issues nearly $4.5 million in G&O bonds
September 24, 2009 · 11:14 AM
On what Chief Executive Officer Cary Bozeman called a “big night for the port and the community,” the Port of Bremerton’s Board of Commissioners Tuesday night approved selling $4.425 million worth of General Obligation Bonds to buy waterfront property, and perhaps build an access road for its South Kitsap Industrial Area.
“This might be one of the best business decisions the port has made in its history, and I congratulate you for approving the purchase,” Bozeman told the board, referring to a 2.13-acre plot on Washington Avenue along Bremerton’s waterfront that the port intends to use initially to provide parking for tenants of its nearby marina. “I think it’s one of the prime pieces of real estate on Puget Sound, and I think the property will only go up in value.”
Bozeman said he also appreciated that the property, which already has a working parking lot, “has a revenue stream to support the debt service, and also has the potential to support a $15-million development in the future.”
However, Bremerton resident John Hanson told the board that he objected to the port’s issuance of bonds “on principle.”
Hanson said that the public participation policy the port recently drafted and approved states that the port will issue a press release prior to the issuance of bonds, but he alleged that it wasn’t until he called the port Monday that a press release was sent.
“Those of us who will be paying these bonds will have very little opportunity to comment,” he said.
Bozeman responded by saying, “I agree that the press release was sent late, but the port has discussed this bond issue at several study sessions. I don’t know if it was a perfect process, but we made every attempt to inform the public.”
Owned by the Kitsap County Consolidated Housing Authority, the property is adjacent to the Bremerton marina and flanked by Washington Avenue between Second and Burwell streets.
The purchase price was $3.5 million, but a $392,000 grant from the U.S. Department of Housing and Urban Development (HUD) was awarded to the KCCHA for improving public access by building a combination stairway-ramp. By a “good faith agreement,” the money will be transferred to the port instead.
As for the rest of the money raised by selling the bonds, Chief Financial Officer Becky Swanson said that it “will be used to build the arterial road, or an alternate project designated by the port commission.”
In July, Swanson estimated that if the port receives the expected grants to build the arterial road, it will only cost the agency $800,000.
The port will pay off the bonds for 20 years, and Swanson said the annual debt payments will be approximately $320,000, varying slightly from year to year.
All resolutions related to the issuance of the bonds passed unanimously.
“I think this is very important, and something we need to do,” said Commissioner Larry Stokes.
“I would like to commend the staff,” added Board Chair Cheryl Kincer. “There was a lot of blood, sweat and tears involved in this.”
• Also at the meeting, Director of Airport Operations Fred Salisbury announced that eight bids from companies wanting to build the Cross-SKIA connector — the arterial road that the recently issued G&O bonds may help build — were opened Tuesday morning.
While the original estimated cost for the project was $2.96 million, Salisbury said Stan Palmer Construction, Inc., of Port Orchard, presented a qualified bid of only $2.027 million.
CEO Bozeman said the low bid would allow the port to “complete more of the project,” which Commissioner Bill Mahan said was “absolutely wonderful.”
Salisbury said the lower cost would allow the port to build almost “double (the road) that we originally planned to do.”