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2015 top 10: Oil terminal fuels debate

Controversial proposed project again tops list; economy is No. 2 story

By , Columbian Business Editor
Published:
12 Photos
The proposed oil-by-rail project at the Port of Vancouver's Terminal 5 was the top business story of 2015.
The proposed oil-by-rail project at the Port of Vancouver's Terminal 5 was the top business story of 2015. Photo Gallery

Clark County bounded back in a big way in 2015 from its recession-era status as the region’s economic laggard, beating out other Portland-area counties in job growth and dealing with one of the problems of prosperity — a tight housing market.

Meanwhile, few could escape the long-running debate over a proposed oil-transfer terminal at the Port of Vancouver, which brought into focus how the community weighs the issues of jobs, environmental protection and public safety.

The oil terminal debate, which will continue in earnest in 2016, is The Columbian’s top business story of the year. The newspaper wrote dozens of news, investigative and opinion articles on the proposal to build what would be the nation’s largest oil-to-ship transfer terminal at the Port of Vancouver. The debate spilled into electoral politics with the election of anti-terminal activist Eric LaBrant to a vacant seat on the Port of Vancouver commission, a move that perhaps could reshape the debate in the year ahead. Business organizations largely remained on the sidelines.

But for all the noise over the oil terminal, it was the recovering economy that helped restore Clark County’s regional business confidence. With the important exception of stagnant wages, major indicators of economic health are positive — more jobs, more building permits, rising retail sales and a declining poverty rate. We chose the improving economy as our second biggest story of 2015.

If those topics sound familiar, it’s because this year’s top two stories were the same as in 2014.

We’ve highlighted those and other stories in our Top 10 list. Any such list is open to debate, and readers may disagree. All comments are welcome at www.columbian.com.

1. Oil terminal battle: The battle over the proposed oil-by-rail terminal at the Port of Vancouver heated up this year with the release of the draft Environmental Impact Statement in November.

The review was commissioned by the state Energy Facility Site Evaluation Council, which will send a recommendation to Gov. Jay Inslee, possibly by the end of next year. The 45-year-old council has never recommended against an energy project. However, the political implications of Inslee approving the nation’s largest oil-by-rail terminal might become more apparent next year, as he faces a likely re-election campaign.

The $210 million proposed terminal, a joint venture by Tesoro Corp. and Savage Companies called Vancouver Energy, would ship crude oil from North Dakota and elsewhere through Spokane and the Columbia River Gorge. According to the environmental review, oil could also come from the tar sands of Alberta, Canada. An average of four 120-car unit trains would arrive at the Port of Vancouver each day to serve the terminal.

Despite Congress lifting the oil export ban late this year — and the environmental review leaving open the possibility of foreign export — Vancouver Energy maintains the oil will be shipped only to U.S. refineries.

The project has its supporters, though dissent has been loud. That will likely only crescendo into next year as the evaluation council finalizes the Environmental Impact Statement and starts looking to the governor’s office, where the project’s fate ultimately rests.

2. Economy gains strength: The county’s job growth was consistently strong throughout 2015, ending November with a 4 percent growth rate over the past one-year period. That’s a faster growth rate than that of the state or Portland region. The county’s preliminary unemployment rate of 5.6 percent is the lowest since December 2007. Job growth was spread across all business sectors except manufacturing, which was flat for the year through November.

What’s noteworthy is the growth in higher-paying jobs in a county that historically has had a broad base of middle-income jobs and a scarcity in the top-dollar professional sector. While the county job base increased by 3.2 percent from 2007 to 2014, higher-wage jobs paying $54 per hour or more grew by 26 percent. Ninety percent of the high-wage jobs are in health care, corporate offices, finance and wholesale trade. There was very little growth in the number of jobs paying $18 to $29.99 per hour, categories that make up the middle-class workforce.

Meanwhile, taxable retail sales in Clark County were up 14 percent over a one-year period at mid-year. Construction permits were up 27 percent, hotel/motel sales climbed 21 percent and restaurant sales were up 10 percent, regional economist Scott Bailey reported.

3. PeaceHealth turmoil: This year was one of administrative turnover for Vancouver-based PeaceHealth, Clark County’s largest private employer with 3,254 full-time and 1,034 part-time employees in the county and $295 million in local payroll.

The health care nonprofit’s string of leadership changes began this spring, just months after the December 2014 announcement by Alan Yordy, PeaceHealth’s president and chief mission officer, that he was retiring this past June.

In April, PeaceHealth announced the departures of four top administrators, including the top two leaders at PeaceHealth Southwest Medical Center.

The next month, PeaceHealth announced it eliminated the PeaceHealth Medical Group chief executive officer position and created two new systemwide positions. Yordy’s successor, Elizabeth “Liz” Dunne, took the helm on Nov. 1.

Then, in September, two more top leaders at PeaceHealth left the health system — one after less than three months on the job. In early December, PeaceHealth named Nancy Steiger its president of hospital services for the Columbia Network. She had been serving in an interim leadership role for the network since March.

The Catholic-affiliated health care provider operates 10 medical centers — five in Washington, four in Oregon and one in Alaska — with 16,010 employees. It also has a group practice with about 800 providers.

4. Waterfront awakening: The long-awaited redevelopment of downtown’s waterfront came much closer to reality with the construction of roads and other infrastructure on the former industrial side west of the Interstate 5 Bridge. Now it’s up to Columbia Waterfront LLC, led by Gramor Development of Tualatin, Ore., to add buildings to the site. It plans $100 million in new buildings, and the city will seek bids in March on a $25 million waterfront park.

Gramor president Barry Cain more than once this year said he was close to announcing a hotel project for the site, but that announcement never came. Gramor did announce that it had secured a letter of intent from the M.J. Murdock Charitable Trust to relocate from downtown to the waterfront once an office building is completed in September 2017.

The Port of Vancouver, meanwhile, lost the Red Lion Hotel Vancouver at the Quay as its Terminal One tenant and almost immediately announced that the Portland biotech firm AbSci LLC would occupy a small portion of the former hotel property beginning next year. The port also launched a redevelopment study for the site as it pursued a hotel operator willing to build a hotel to replace the Red Lion.

5. Christensen Shipyards sinks, then swims: One of Vancouver’s iconic industrial businesses , the yacht builder Christensen Shipyards, all but tanked this year before relaunching operations under new ownership amid a bitter legal battle. The company’s financial troubles surfaced publicly in January, and a month later the shipyard at 4400 S.E. Columbia Way shut out its workers amid deep financial troubles. In March, Tennessee businessman Henry Luken, a 50 percent owner of the company, filed suit and asked a Clark County Superior Court judge to appoint a receiver to assume control of Christensen Shipyards and to manage its assets.

The company also faced lawsuits from suppliers for unpaid bills, and in June a Clark County Superior Court judge approved sale of the company’s $5.5 million worth of tangible and intangible assets to Luken. Now full owner, Luken has reopened the shipyard, with about 103 employees, and hopes to rebuild the business. Litigation will continue in 2016.

6. Marijuana sales ups and downs: The county’s marijuana retailers enjoyed strong sales for the first part of the year, with Oregon residents joining local marijuana users to produce some of the highest sales figures in the state. Sales spiked when Oregon legalized the drug for recreational use before sales outlets opened in that state. But sales dropped in the fall when Oregon allowed medical marijuana dispensaries to sell recreational marijuana.

The Washington Liquor and Cannabis Board this fall temporarily lifted its limits on the number of retail pot licenses issued statewide as it implemented changes made to the law to align the medical and recreational marijuana markets and requirements, which could lead to a major expansion of retail sites. The rules also give medical pot users an incentive to use the recreational pot shops. The board began taking new applications for recreational retail licenses. Applicants must obtain state licensing before applying locally. But the Vancouver City Council, in a 4-3 vote, maintained a cap of no more than six recreational retail stores.

7. Housing affordability worsens: Renters and homebuyers felt the housing crunch this year as stagnant wages were met with increased housing prices. The median sale price for a home in Clark County — half sold for more, half for less — was $274,000 in November, a 7.5 percent increase from November of last year. The amount of time homes are on the market dropped considerably this year, and the amount of inventory remained distressingly low, with enough homes to fill only two months worth of demand during much of 2015. The housing shortage was most severe in the entry-level price ranges below $200,000.

Vancouver had the highest year-over-year rent increase in the nation, according to the website Apartmentlist.com. The average rent for a two-bedroom, one-bathroom apartment in Vancouver is $1,013, according to a recent report from NAI Norris, Beggs & Simpson. Vacancy rates in Vancouver hover between 1 and 2 percent, depending on the location; while the west side has lower rents, the east side has more vacancies.

More than half of all renters are cost-burdened, which means, according to the standards set by the U.S. Department of Housing and Urban Development, that those households are paying more than 30 percent of their income toward rent. The lower someone’s income, the more likely they are to be cost-burdened by housing.

8. Downtown Vancouver changes: Vancouver-based Killian Pacific launched construction of The Hudson, the first new downtown Vancouver office structure to break ground in several years, at 101 Main St. The nearly completed building, named for the fur-trading company that helped establish Vancouver in the 1800s, will house Killian’s own offices and a Pacific Continental Bank branch when it opens in 2016.

Also downtown, Vancouver’s former city hall building at 213 E. 13th St., renovated and renamed Block 56, filled up with commercial and office tenants after a $4 million renovation.

One tech company made a big splash in the downtown commercial market. DiscoverOrg, which builds and maintains databases of marketing intelligence aimed at IT vendors and staffing agencies, moved into the 805 Broadway Building and continued its rapid growth. The company occupies 27,000 square feet and may add an additional 20,000 square feet of space. By year’s end, the company had 200 employees, having doubled its staffing within a year. Smaller tech companies increasingly sought out space in the downtown’s office suites and retail storefronts.

9. VanMall gets new owners, Wal-Mart expands: The long-expected sale of Vancouver Mall by the Australian real estate firm Westfield Group to Centennial Real Estate Co. of Dallas finally closed this month. New owners immediately removed the Westfield name and promised to bring new energy to the mall, with a new Golds Gym and H & M clothing store both expected to open in the former Nordstrom space in 2016.

Also on the retail front, Wal-Mart continued its aggressive expansion in Clark County with the opening of its newest supercenter in Orchards. The Arkansas retail giant now has seven stores in Clark County — five supercenters and two neighborhood markets — with some 1,700 full- or part-time employees.

10. Wacom going, Banfield Pet Hospital coming: Digital pen maker Wacom, long a flagship of Clark County’s technology sector, said in March that it will head south to Portland’s Pearl District in 2016 with most of its 160 employees. The Japanese company will also open a ground-level retail store at its Pearl location. Wacom has based its Americas operations in Vancouver since 1989 but a spokesman said its global managers chose Portland to be “closer to the center of creativity.”

In another move across the Columbia, this one from south to north, Banfield Pet Hospital launched construction of a new corporate headquarters on 17.5 acres at Southeast Mill Plain Boulevard and Southeast 184th Avenue. The new campus will house some 600 employees who are relocating from Northeast Portland. The company, a subsidiary of Mars Inc., operates about 900 pet hospitals in the United States and Puerto Rico and employs more than 2,900 veterinarians, as well as support staff.

Reporters Brooks Johnson, Marissa Harshman and Patty Hastings contributed to this report.

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