Coleman’s Port of Vancouver tenure at a close

Now-departed port CEO’s four-year stint will be forever stamped with oil-terminal controversy, but there was much more to his role

By Brooks Johnson, Columbian Business Reporter

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Todd Coleman became CEO of the Port of Vancouver just after the port hit its 100th birthday, a milestone marking a century of relative political peace within the community.

In the four years and 19 days since taking the reins, Coleman put the port on the global battlefield of fossil fuel policy, the regional front lines of rail safety and in the local spotlight over transparency.

Now, with all eyes on the port, Coleman has left the building.

Coleman, 47, surprised many when he tendered his resignation May 4. His final day as the port’s executive director was Thursday, and he leaves a legacy far more contentious than those of recent predecessors who served three times as long.

“I always believe leaders have seasons within an organization,” he said in an interview earlier this month.

Then this must have been the season of beginnings and endings after four eventful years leading Washington’s third-largest port.

While the port’s three elected commissioners — Coleman’s bosses — were surprised at his going-away announcement, Coleman apparently only wanted to serve four years as CEO, regardless of the initiatives he left unfinished. Among them are newer long-term ventures — such as the proposed oil terminal and waterfront redevelopment — and those much closer to fruition — such as the $275 million West Vancouver Freight Access project or the Centennial Industrial Park.

“I like doing the operations side of things,” said Coleman, who spent a total of 15 years at the port. “I was not that keen on taking the executive director role but saw there were a number of initiatives we had begun … and I had agreed to do that for four years.”

With interim CEO Julianna Marler in place, commissioners now must find a permanent replacement and decide whether to find an outside voice or pick one of Coleman’s rank-and-file who will continue his legacy.

Whether it will all turn into a huge mess or a great success, Coleman can say one thing of the high-profile issues now surrounding the Port of Vancouver: “I did that.”

Oil and water

In 2013, the port started discussions with a couple of companies called Tesoro Corp. and Savage Cos., now familiar as the forces behind the proposal for the nation’s largest rail-to-marine oil terminal. That nearly 3-year-old proposal, dubbed Vancouver Energy, is still slogging through the state permitting process, awaiting a recommendation from the state Energy Facility Site Evaluation Council and final approval or rejection by the governor.

Rather than wait out the public finale of the process he started behind closed doors with commissioners all those years ago, Coleman is leaving right as things are heating up for the 360,000-barrel-per-day terminal.

The port commission just extended a lower-cost contract to make sure the terminal at least gets a permitting decision from the state, likely by next spring. The evaluation council is holding trial-like adjudication hearings on the project this summer. A poll conducted for the port this spring shows a community split over the terminal, but opponents have always made the most noise.

That constant clamor has likely put a ringing in Coleman’s ears, though he knew he would be standing closest to the speakers when he booked the band. Or perhaps, given the port’s quiet past, the all-out opposition to the terminal in a community not known for political activism wasn’t exactly expected.

As Commissioner Brian Wolfe put it after learning of Coleman’s planned departure: “It’s more stressful to him than he lets on.”

Curiously, Coleman and his staff offered commissioners a way out of the terminal by recommending against the cost-cutting lease extension requested by Vancouver Energy in April. But commissioners chose to keep the project afloat by modifying Vancouver Energy’s requested terms. Just a few weeks later, Coleman announced he was leaving.

While speculation abounds about the timing of Coleman’s departure, the oil terminal will continue to define his tenure, in part because it ties into so many other initiatives.

Take the West Vancouver Freight Access project. The 10-year, $275 million rail investment is the port’s single largest infrastructure venture, meant to relieve rail congestion and expand the port’s capabilities. The oil terminal would take advantage of some of those upgrades, such as the loop track at Terminal 5. Vancouver Energy’s terminal would also go a long way in helping to pay for the project. Something has to, whether it be increased tenant revenues, financing or a tax increase.

A major piece of the rail project — the watertight trench along the Columbia River that provides a new lane for train traffic — was christened in the fall by port and state officials en route to the project’s 2017 completion. While he was speaking, Coleman was interrupted by a train horn.

“The economy just got louder,” he said.

Visible success

Below a noisy air highway to and from Portland International Airport, between a rushing river and well-traveled rail lines, between a century-old bridge and an industrial site, billions of dollars are waiting to be spent by the port and private developers.

On the eastern edge of Vancouver’s long-awaited downtown waterfront development sits the port’s Terminal 1 property, a late addition to the city’s reconnection with its riverfront roots. Coleman can bask in the community’s warm embrace of that project to get away from the oil terminal controversy that has strained the port’s relationship with its constituents.

“The Terminal 1 property is a tremendous asset for the community,” Coleman said in an earlier interview.

In the past two years, the 10 port-owned acres surrounding and including the former Red Lion Hotel Vancouver at the Quay have gone from “what do we do” to “look what we did.” Though a master plan for the site is still coming together, a few milestones are within sight:

• A restaurant and event space will open at the shuttered Red Lion this summer.

• Developers have been chosen to build a boutique hotel and a multiuse office building that could house the port’s headquarters

• A bioscience company is set to move to the former Red Lion building this summer, with more perhaps on the way.

Several buildings will occupy the site, and the over-water Terminal 1 itself will be stripped to its original prune warehouse shell to give it an open-market feel.

Coleman might not get his name on any of it, since he won’t be staying to see the site finished, but he and his staff pushed for the redevelopment and surely deserve credit.

As far as normal operations under Coleman’s reign — more than 3,200 people come to work on port property every day, after all — revenues and port acreage grew markedly in the past four years. Longshore union members locked out of the United Grain Corp. terminal on port property picketed the company throughout the 18-month labor dispute, but the port managed to keep its distance without getting embroiled in the controversy.

The last big initiative Coleman touts, beyond the waterfront and rail infrastructure, is the Centennial Industrial Park. North of Lower River Road is a field of shovel-ready industrial land, and already shovels are hitting the ground for a 125,000-square-foot speculative building by the port and the 306,000-square-foot new headquarters of Sunlight Supply. The port sold, rather than leased, property to Sunlight, raising some questions about choosing a short-term pursuit of cash over long-term value of leasing income.

To fill the rest of the land, the next administration will have to keep promoting the “Port of Possibilities,” a catchphrase that can get lost in the fight over the oil terminal.

Yet despite the heavy news coverage and ongoing community participation, the port’s own polling in March still showed 42 percent of residents are “too unfamiliar to say” how the port is doing on a 10-point scale. Even with the acrimony and growth, residents stuck the port with an uncertain 6.2, which has the feel of a shrug with the weight of a “we’ll see.”

As for Coleman, his own future is uncertain. The Brush Prairie resident said he has no plans other than to spend a few months at home with his family before getting back to work, doing who knows what, who knows where.

“I look forward to going back to work and doing something significant again,” he said.

Key issues under Coleman’s tenure

As the Port of Vancouver’s CEO, Todd Coleman has had successes, failures and controversy. Here are some of the port’s key issues in the past four years.

Vancouver Energy oil-transfer terminal

Whether the project is ever built, the port’s pursuit of an oil terminal will be Coleman’s enduring legacy. The proposal now under state environmental review calls for Vancouver Energy, the partnership of Tesoro Corp. and Savage Cos., to lease 42 acres at the port’s 218-acre Terminal 5 for a crude oil distribution facility. Up to 360,000 barrels of North American crude oil would arrive daily for transfer to ships that would deliver to West Coast refineries. An initial lease, which would take effect when the terminal opens, would extend for 10 years. As Coleman leaves the port, the project is far behind schedule and its fate is uncertain.

West Vancouver Freight Access Project

Coleman presided over the near-completion of the decadelong, $275 million West Vancouver Freight Access project, which will increase rail capacity and reduce rail congestion by as much as 40 percent. The work since 2007 has involved 21 separate projects including a new $30 million rail entrance, an expanded rail corridor and a loop track at the port’s Terminal 5. Funding came from public and private sources. The port says the entire freight-access project will come in about $50 million under budget.

Terminal 1 redevelopment

The Red Lion Hotel Vancouver at the Quay closed in the fall at Terminal 1. Port officials pushed ahead with a plan for the roughly 10-acre site that adjoins the much larger, private Vancouver Waterfront redevelopment site. It renamed the empty hotel building as the Columbia River Life Sciences Building and the announced that AbSci, a Portland biotechnology company, would be its first tenant. So far no other biotechnology companies have followed, but the port scored a coup when Mark Matthias, owner of Beaches Restaurant & Bar, signed a short-term lease for a restaurant and event center on the building’s first floor that is slated to open this summer. The port this month announced that local hotel operator Vesta Hospitality would build a new Marriott-branded AC hotel at Terminal 1 and that the local Holland Partner Group would be master developer of an office, retail and residential complex.

Centennial Industrial Park

The port launched infrastructure work in 2013 on its 108-acre Centennial Industrial Park. The property features 17 acres that are ready-to-build and available for lease, and another 50 acres for future development. This year, the port kicked off construction of a 125,000-square-foot industrial building that will be available for lease next spring. The port last year sold 15 acres of the industrial park for $4.2 million to Sunlight Supply, an indoor gardening products manufacturer. The company is building a $32.6 million, 306,000-square-foot headquarters and operations facility for about 250 employees.

Potash export terminal

In mid-2014, the port ended its exclusive lease option with Australian mining giant BHP Billiton after four years of waiting to close a deal on a terminal to export potash, a crop fertilizer. The company would have leased nearly 100 acres at Terminal 5 for a deal that was to have attracted at least $250 million in private capital investment. The port said the project would have been one of its largest revenue producers. The deal collapsed due to falling prices for potash, the inability of BHP to complete work in its Canadian mine and the company’s difficulties in securing a rail transport contract. The Terminal 5 property remains vacant.

Tenant contract renewals

The port has more than 50 tenants. In 2015, it secured a 10-year lease extension with Subaru of America Inc., one of its largest tenants. It also negotiated a hard-fought 10-year extension with Northwest Packing Co., a fresh-fruit processor that had threatened to leave the port under a lease extension initially proposed by the port. So far this year, it has renewed leases with eight other tenants for periods ranging from five to 15 years.

Cargo exports

In 2015, the port became the third largest in the state when it moved 6.95 million metric tons of cargo, including grain, automobiles (Subarus), wind energy components, fertilizer, minerals, steel and wood pulp, up from 6.6 million in 2014. Exports were up 3.9 percent from 2014, while imports, which make up just 15 percent of port cargo activity, increased by more than 12 percent. Port tenant United Grain Corp., a major export terminal, locked out its Longshore workers in early 2013 after a long period of labor tension. The lockout ended some 18 months after it started, when union members overwhelmingly ratified a new agreement with United Grain and other Northwest grain terminals. United Grain continued to operate during the lockout, and the port managed to stay out of the fray.

North Dakota grain trains

In 2014, Coleman won the commission’s support for a deal to lease up to 180 rail cars. The plan was that trains would transport Midwest agricultural products to the port instead of returning to Vancouver empty after delivering fracking sand and other raw materials from Asia to North Dakota’s then-booming Bakken oil fields. Coleman had estimated conservatively that the arrangement could generate $18.6 million in revenue in 2015. The project and the port’s projections for revenue growth were scaled back dramatically within a year without the port purchasing any rail cars.