East Clark County economic development leaders are aiming to tap a federal program to spur private investment in Washougal and Camas to generate jobs. Meanwhile, they plan to investigate the market feasibility of transforming a key 40-acre waterfront parcel into a “destination” point.
The potential use of the federal New Markets Tax Credit program and the future development of the waterfront site were topics of discussion during this week’s regular public meeting of the board of the Camas-Washougal Economic Development Association.
The association — a creation of the Port of Camas-Washougal and the cities of Camas and Washougal — wants to hire a consultant to help launch a Community Development Entity. That entity, which would include its own governing and advisory boards, would sell tax credits to private investors and plow the proceeds into job-creating projects that benefit low-income communities.
The idea behind the indirect federal subsidy is to lower the cost to private investors of injecting new or increased capital into economic development projects that may otherwise struggle to attract conventional financing. Congress created the New Markets Tax Credit program in 2000. Several projects in Washington and Oregon have used the program, including Farwest Steel Corp., which in 2011 obtained $48 million in federally subsidized financing to build and equip its steel fabrication plant in Vancouver.
To win the right to sell tax credits is a competitive process. Moreover, there are rules designed to maintain transparency, including annual reporting and accountability requirements, and to ensure the money goes only to qualified projects.
While no decisions have yet been made, Camas and Washougal officials are talking about the first step in the process: establishing the Community Development Entity. To that end, Paul Dennis, president and CEO of CWEDA, is asking the port and the cities to allocate $87,500 to hire Portland-based Pilot Management Resources LLC to help launch the new entity.
The port would pay half the bill, with each city equally chipping in the other half. Dennis said Friday he expects the allocation — and an underlying agreement between Camas, Washougal, the port and CWEDA — to win approval in April.
It’s not yet clear whether the Community Development Entity would act as a private, public or nonprofit organization, but Dennis said it’s likely it will be structured as a private agency. The staffing of the CDE would depend on the size and numbers involved in an economic development project that receives tax credits, Dennis said. The $87,500 requested to hire the Portland consultant to set up the CDE is “one-time seed money,” Dennis said. The CDE “will be set up so it’s self-sustaining,” he added. “If it’s (a) private organization, then the private side will take care of it.”
And if the port and cities agree to kick in that seed money to launch the Community Development Entity, then the CDE would work to meet a September deadline to apply to the U.S. Treasury Department for the right to sell tax credits. That application would include a list of three economic development projects.
Dennis declined to identify the projects but said one would likely involve Washougal’s downtown, another would likely involve Camas’ downtown and the third would likely involve the port’s Steigerwald Commerce Center. “If we’re able to get an answer from (the U.S. Treasury),” Dennis said, “then we would work with private capital to get the projects built.”
Meanwhile, the board of CWEDA on Thursday received a draft market analysis of four potential development scenarios under which a 40-acre waterfront parcel could be transformed from a former industrial site into a place to live, work and play.
The analysis — delivered by Eric Hovee, principal of E.D. Hovee & Company LLC — includes an examination of the site of the former Hambleton sawmill. In November 2012, the Port of Camas-Washougal purchased about 13 acres of the 26-acre parcel from Killian Pacific, a Vancouver-based commercial real estate developer. That $6 million acquisition added to the 14 acres the port already owns immediately east of the former lumber mill site. Killian Pacific retained the other 13-acre half of the former mill parcel.
Together, the port and the company want to redevelop the entire 40-acre waterfront site — which is about 1.7 miles away from Washougal’s downtown — into a place that could feature recreational, commercial and residential uses. The port is seeking state funding to help build a waterfront trail and park.
Of the four development scenarios, Hovee’s draft analysis highlighted the details of two in particular that would likely have an opportunity to move forward sooner rather than later. The “community commercial center” scenario would include space for retail and office purposes. It would create 720 jobs at full build-out and generate $4.6 million in one-time state and local sales taxes as well as $6.6 million in annual sales and property taxes.
The second scenario featured a mix of commercial and residential uses, including 175,000 square feet of commercial space and 370 multifamily residential units. It would create 360 jobs at full build-out and generate $9 million in one-time state and local sales taxes, as well as $4.6 million in annual sales and property taxes.
“We have the ability to look at other concepts,” Hovee told CWEDA board members.
In fact, board members indicated they want to see other concepts — particularly further analysis of a third scenario, “multi-use destination,” which could involve building attractions such as a lodge or water park or specialty outdoor store. Port of Camas-Washougal Commissioner Mark Lampton, a CWEDA board member, said public input into planning for the site “was place-driven,” with people having “more of a destination in mind as opposed to a retail village.”
Dennis, the CWEDA president and CEO, said he would talk to Hovee about further analyzing the market feasibility of the “multi-use destination” concept. Also, he said, he would follow up with Lance Killian, president of Killian Pacific, to further discuss Killian’s objectives in owning half of the former mill property.
Lampton said the 40-acre waterfront property is unique, so it’s important to get the development plan right. “There’s got to be more to this waterfront than what we’re looking at today,” he said.