Thursday, September 24, 2020
Sept. 24, 2020

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Port OKs preliminary budget of $76.9M

2016 plan includes $23M in borrowed money for projects

By , Columbian Business Editor

The Port of Vancouver’s Board of Commissioners on Tuesday approved a preliminary 2016 budget that projects $76.9 million in spending in the fiscal year, including up to $23 million in borrowed money to pay for ongoing freight rail access improvements and other capital projects.

The preliminary budget, which won unanimous approval from the three-member commission, anticipates $42.6 million in operating revenues, with marine operations as the largest contributor ($17.7 million in revenue). The port also expects $11 million in non-operating revenues, with $10 million of that amount coming from taxes and $1 million from grants.

What’s missing from the preliminary budget is any significant activity on a freight-hauling venture that Port CEO Todd Coleman and his staff had initiated one year ago. The port staff at that time had projected a conservative estimate of $18.6 million in revenue from a “dedicated rail service” program that called for the port to lease up to 180 rails cars that would haul fracking sand and other oil-drilling materials to North Dakota and then return with crops destined to overseas markets. The initiative faltered as falling oil prices triggered a cut in oil production, and in July the port commission adopted a supplemental budget that trimmed its revenue estimates from that program by $15.3 million.

Scott Goodrich, the port’s director of finance and accounting, said the port is still exploring potential opportunities for a dedicated rail service program. The port expects to roughly break even in the next fiscal year with about $2.2 million in expenses and revenues. Because of the slowdown in oil production in North Dakota, the port is storing the equivalent of 18 rails cars’ worth of unwanted fracking sand in storage at the port, with the buyer paying storage fees, Goodrich said.

The anticipated $23 million draw on the port’s line of credit will finance part of a capital improvement budget that will be invested in the West Vancouver Freight Access Project and other projects. Those include industrial building improvements and development of a 100,000 square-foot building in the port’s Centennial Industrial Park, Goodrich said. The port expects to wrap up its investment in the rail access project in the 2017 fiscal year.

Extension sought for review period for oil terminal impact statement

Vancouver Energy has asked the state Energy Facility Site Evaluation Council to extend the public review period for a draft Environmental Impact Statement on an oil-transfer terminal at the Port of Vancouver from 45 days to 60 days.

Jared Larrabee, Vancouver Energy's General manager, told the Port of Vancouver commission Tuesday that the Tesoro Corp.-Savage Companies consortium had asked the site council for an extension and was awaiting a response. A spokeswoman for the council said Tuesday that no decision has been made about extending the review period.

The draft Environmental Impact Statement is scheduled for release on Nov. 24. Opponents of the rail-to-ship oil transfer terminal have complained that the timing of a 45 day review period during the holidays would diminish public participation in the review process.

— The Columbian

The port also will move forward on design and permitting for redevelopment of its waterfront Terminal 1 site. It will lose about $200,000 in revenue with the recent closure at Terminal 1 of the Red Lion Vancouver at the Quay, Goodrich said.

Ron Morrison, a citizen who regularly attends port commission meetings, questioned the port’s reliance on borrowed money. Noting that the expected $23 million line of credit draw represents nearly one-third of the port’s budget, Morrison said that the budget has “too much spending and not enough revenue.”

Goodrich told Morrision that the port is self-supporting in its operations and that the investment in rail improvements was part of a long-term plan to meet the needs of the port’s tenants. The port commission expects to adopt a final budget after a Nov. 24 public hearing.