Minutes of December 7, 2004
Work Session/Regular Session Meeting
Port of Hood River Commission
Expo Center Conference Room, 5:00 P.M.

Present: Commissioners Sherry Bohn, Don Hosford, Hoby Streich, and Kathy Watson; Attorney Jerry Jaques; from staff, David Harlan, Mike Doke, Linda Shames, and Laurie Borton

Absent: Commissioner Fred Duckwall; from staff, Linda Hull

Media: RaeLynn Ricarte, Hood River News

President Sherry Bohn called the Commission into work session at 5:03 p.m.

1. WATERFRONT INTERGOVERNMENTAL AGREEMENT (IGA): President Bohn expressed her goal for the Work Session was to reach consensus on whether or not the Commission could embrace Ordinance No. 1851 (Columbia River Waterfront Mixed-Use Zone) and move forward by assisting the City in the passage of 1851; and, if so, utilize this time to work on finalizing the draft IGA in hopes that it would be approved and in place by the end of this year. President Bohn agreed to Commissioner Streich's request that comments from City Manager Bob Francis, Mayor-elect Linda Rouches, and Councilor-elect Ann Frodel be allowed.

Following a lengthy discussion, which included comments on some of the ambiguities in the Ordinance's language, concerns about land values once the zone is in place, and recourse if the developer believes the zone isn't workable, there was consensus from the Commissioners to affirm 1851 and move forward.

The discussion then focused on the Lot 6 Waterfront Park IGA. Although the timeline outlined in the Port's Letter of Intent with the City calls for a signed IGA between agencies is within 90 days of zone approval, President Bohn was insistent that substantial progress needed to be made before the second reading of 1851 scheduled by the City for the end of the month (the first reading is scheduled for December 13, 2004).

The park IGA has gone through several iterations thus far, beginning with a first draft by City Attorney Alexandra Sosnkowski and a re-draft currently being worked on by Port Attorney Jerry Jaques. Executive Director David Harlan stated that there are a number of complexities involved with the Port's donation of the Lot 6 property to the City and there are issues that may not be resolved before the end of the month, such as a "finding of facts" supporting the donation of the property. President Bohn disagreed; stating she believed a finding of facts was unnecessary and that she did not want a leveraged land donation from the Port to be questioned. Commissioner Hosford asked for a clarification on Bohn's leverage comment, to which she responded, "Why should the City approve 1851 without an IGA? It should not be used as leverage." Bohn asked the Commission to discuss four issues she believed could be perceived as leverage points that would require Commission consensus relative to finalizing the IGA. The following consensus was reached:
1. Reversion Clause: There should be a clause providing for reversion of property title back to the Port if the park is not developed within seven years. Extension beyond seven years would not be considered. Executive Director Harlan reminded the Commission the park needed to be defined pursuant to the Letter of Intent and that definitions of a "developed park" written into the IGA and referenced in the deed would avoid ambiguities and future conflict. 2. Park Development/Maintenance: The Port and developer would not be required by
the IGA to subsidize park development and/or maintenance, but would not be precluded from making a contribution. 3. Park Funding: Agree to jointly pursue funding and use public funding mechanisms
for public improvements, including tax increment financing. 4. Park Master Plan: It was agreed that more time was needed to make a decision on syncing the Park Master Plan to the Waterfront Master Plan.

Attorney Jaques summarized the work session by stating tonight's discussion illustrated there are issues yet to be discussed and decided.

President Bohn closed the work session at 7:12 p.m.

1. CALL TO ORDER: President Bohn called the regular session to order at 7:17 p.m. and thanked the audience for their patience in the delayed start time for the regular session. Kris Gann, Linda Maddox, Eric Burnette, Beth Lopez, Mary Harper, and Dale Robbins introduced themselves.

2. PUBLIC COMMENT: None.

3. APPROVAL OF MINUTES:

Motion: Move to approve the November 16, 2004 (regular) meeting minutes.
Move: Hosford
Second: Watson
Vote: Aye: Bohn, Hosford, Streich, and Watson
Absent: Duckwall
MOTION CARRIED

4. INFORMATION-COMMUNICATIONS:

a) Guests:
· SR-35 Bridge Replacement Study: Michael Ray, Oregon Department of Transportation, became unavailable and was replaced by Dale Robins of the Southwest Washington Regional Transportation Council who provided an overview (handout attached) and answered questions about the SR-35 Columbia River Crossing feasibility study. The Commission thanked Robins for the information.
· Employment Department Job Fair: Elizabeth Lopez, Oregon Employment Department-WorkSource Oregon; and Mary Harper, WorkSource Washington, provided a PowerPoint presentation on the successful Columbia Gorge Job Fairs that have been held the past three years, and which is again scheduled to be held at the Expo Center on April 2, 2005. Lopez and Harper answered questions and were thanked by the Commission for the information.

b) Executive Director:
· Bridge Update: Executive Director Harlan reported the Oregon Department of Transportation and Washington Department of Transportation (WSDOT) have involved the Port in discussions relative to supposed archeological findings discovered at the sub-contractor's Washington worksite. Harlan stated the site had been previously disturbed during a WSDOT project and it was Harlan's opinion that neither the Port nor the contractor on the redecking project should be involved.

· Waterfront Update: City Council and staff have been invited to attend the Port's Special Meeting on December 10 for discussion of waterfront development with William Smith Properties. The first reading of zoning Ordinance 1851 is on the agenda for the City Council's December 13 meeting.

· Waterfront Industrial: Homeshield has requested an electrical upgrade, but Harlan stated he was unsure if the upgrade would be useful to another tenant and that it may be difficult to support since Homeshield is looking to relocate outside of the Hood River Port district. A Hood River law firm will be moving temporarily into the UTS Portsite Building while a new office is being built.

· Wasco Business Park Update: Executive Director Harlan advised the Commission there was a problem with an initial concrete pour and the contractor may seek liquidated damages for a construction delay. Humanities Software has requested revisions to the tenant layout, which impacts electrical and mechanical floor plans. Humanities is uncertain at this time if they will pay for the changes outright or ask that the cost be rolled into their lease rate.

· Big 7/College Update: No report.

· Waterfront Recreational: At the request of the Waterfront Recreation Committee, a preliminary cost estimate for removal of the marina beach sand bar was obtained. With no guarantees of permit approval or solution to a problem that will likely recur, the projected range was $1.7 to $3.3 million dollars to dredge and dispose of the silt.

· Airport: Mike Doke, Marketing Manager, reported the County Planning Commission had made the decision not to review and adopt the Airport Master Plan into the county's transportation and comprehensive plan, and will instead deal with land use applications on a case-by-case basis. Doke stated that he would advise David Miller of Century West Engineering that his consulting services, which had been approved at the November 16 Commission meeting, would not be required.

· Other: The Commissioners were provided a draft Real Estate Transaction Policy for review and Executive Director Harlan stated that action would be taken at a future Commission meeting. Harlan also announced that former Port Commissioner Dr. Stanley Wells, who had served as Secretary and President from 1963 to 1974 had passed away on December 2, 2004.

c) Other:
· Waterfront Recreation Committee: President Bohn highlighted the following items from the December 1 committee meeting: a suggestion was made to not impose 2005 user fees at the Hook or Spit nor raise fees at the Event Site; explore dredging costs of the marina beach sandbar; and research the possibility of having a "park host" at the Event Site. Executive Director Harlan stated that the committee was informed that Homeland Security requirements could impact the Nichol's Boat Basin "slack water beach" access because of its proximity to the cruise ship dock, but that City Council had already indicated access could be moved to the east (Spit) side of the basin.

5. ACTION ITEMS:

a) Bridge Span Lock Rehabilitation: HNTB, the Port's bridge engineering firm, provided a proposal to perform the engineering work needed to rehabilitate the span locks at both ends of the lift span, which earlier in the year had failed to release and prevented the lift span from operating. A maintenance platform for accessing the span locks was also included in the proposal, which staff recommended be done for safety reasons.

Motion: Move to authorize HNTB to engineer the bridge lift span lock rehabilitation and maintenance platform to access the span locks in the amount of $46,900.
Move: Watson
Second: Hosford
Vote: Aye: Bohn, Hosford, Streich, and Watson
Absent: Duckwall
MOTION CARRIED

b) Letter of Support Request-Pasquale Barone: Eric Burnette provided illustrations of the Union Building that Pasquale Barone would like to remodel into commercial and residential space. Burnette explained the purchase of a 12-foot strip of land along the rail line, which would be required for first floor tenant access, had been under discussion with Union Pacific Railroad but that communications had broken off. Burnette stated that the City and County of Hood River had provided letters of support for Barone's project and Burnette hoped the Port Commission would assist as well. The Commission directed staff to obtain copies of the City and County letters and draft a letter for Commission review.

c) Humanities Building Project-Cost Adjustment to Lease Rate: Executive Director Harlan reported that Humanities Software had requested changes to the approved tenant layout and had asked for the option of a lease rate adjustment if they chose not to make an outright payment for the tenant space revision.

Motion: Move to authorize the Executive Director to have the option of negotiating a lease rate adjustment with Humanities Software, in an amount not to exceed $5,000, for tenant space revisions requested by Humanities Software, unless the tenant chooses to pay for the revisions.
Move: Watson
Second: Streich
Vote: Aye: Bohn, Hosford, Streich, and Watson
Absent: Duckwall
MOTION CARRIED

d) Accounts Payable:

Motion: Move to approve Accounts Payable to Jaques, Sharp, Sherrard & FitzSimons in the amount of $7,058; and to Richard Hill Associates in the amount of $7,740, for a total of $14,798.00.
Move: Streich
Second: Watson
Discussion: Commissioner Watson expressed her disappointment in the Richard Hill Associates work product and conclusions. Executive Director Harlan stated he had reviewed the billing in detail and that the consultants were nearing the completion of their Scope of Work.
Vote: Aye: Bohn, Hosford, Streich, and Watson
Absent: Duckwall
MOTION CARRIED

6. ANNOUNCEMENTS: None.

7. EXECUTIVE SESSION: President Bohn called the Commission into Executive Session under ORS 192.660(1)(e) Real Property, and ORS 192.660(1)(h) Litigation at 8:55 p.m. At the conclusion of Executive Session, the Commission was called back into Regular Session at 9:50 p.m.

a) Executive Session Action: No action was taken as a result of Executive Session.

8. ADJOURN: President Bohn adjourned the meeting at 9:50 p.m.

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Minutes of December 10, 2004 Port of Hood River Commission Special Meeting
Hood River Inn - Riverview Room
10:00 A.M.

Present: Commissioners Sherry Bohn, Kathy Watson, Don Hosford, Fred Duckwall and Hoby Streich; Attorney Jerry Jaques; from staff, David Harlan, Mike Doke, Linda Shames, and Linda Hull

Guests: Bill Smith, Bill Lyons, David Blum, Dick Hill, Rich Leonard, Bob Francis, Cindy Walbridge, Linda Rouches, Ann Frodel; Linda Maddox, Rodger Schock

Media: Raelynn Ricarte, Hood River News

President Sherry Bohn called the Special Meeting to order at 10:00 A.M. for the purpose of discussing the status of the waterfront development with Bill Smith of William Smith Properties and exchanging information with him. Introductions by attendees were made.

Bill Smith told the audience it took him almost five years to get a workable zone in Bend. Like here, everyone wanted to help and they had lots of ideas. Smith stated it was not his intent to write this zone in Hood River. However, in his opinion as a developer, the zone is all but unworkable. It's too specific and restrictive in some areas and silent in others so that everything can be appealed because of the ambiguities. It needs many things changed to make the ordinance workable for any developer.

For example, the Pedestrian Access Way (PAW) as drawn on Diagram F from Ordinance 1851 is a 12,000 linear foot by 12' wide trail that goes nowhere, mostly in a straight line and not meandering, and does not connect to downtown. Besides being unattractive, who builds it and at what cost? Who pays for the PAW that is not within the mixed-use zone but shown on the Diagram? It is a big expense. The PAW that goes out to the Spit will be driven on because there is only 10 feet left to the edges. The zone says every 400 feet there must be access to the PAW but it is unclear in the zone how this can be done or what variances there may be. It appears to be a developer-imposed hardship. The PAW plus the roadway and bike lanes create 60' of asphalt; is that what you want for a pedestrian-friendly development?

Other examples: 1) You need to have both native and attractor traffic to a development. The zone says no gas station but if the current gas station could be relocated it would create usable land around the boat basin and give freeway traffic a reason to stop. 2) For retail and commercial you need parking. If the Event Site charges parking, how does a developer control people using other lots so they don't have to pay? How will residential parking work? Who pays for public parking? This is not addressed in the zone. 3) The 2nd Street view corridor is undefined and unworkable. Anyone can appeal a tall tree. How is the corridor measured? From Oak Street? From State Street? Higher up? This is not defined in the zone. 4) The zone states the developer has to master plan the whole area, but requires a 60% maximum of one use plus there has to be three different uses. What are the uses? Why three uses? What if first phase is one use and the market changes? How can the development be accomplished over time?

Smith stated two fundamental issues that need resolution before development can begin. First, the city wastewater treatment plant is still accepting privy waste from the farmers. You cannot have residential housing as part of the mixed use until that odor is removed. Bob Francis said they are studying different methodologies at the current time and that it is expensive for the haulers to go to Goldendale or Troutdale. Second issue is having more environmental studies done on the property. A Level 1 has been completed, but Smith needs a more detailed study in certain areas to be able to obtain financing on the project. This affects the appraisal valuation as well.

Smith stated that the Port should own the PAWs and keep them open subject to reasonable rules and regulations although the zone states the City will control them and that they will be open 24x7. The City has no money to take care of it and, in Portland for example, the police can't patrol them and therefore the safety of the public is compromised.

Smith discussed the minimum lot size requirements as too specific. You have to have 100 people to make 1,000 s.f. of retail work. He sees the residential element here encompassing a mix of young professionals and empty nesters in a variety of unit sizes with storage space.

David Blum asked Smith to comment on the master plan process in the zone. Smith feels it is unclear if you have a one-time master plan and then future master plans have to be compatible with all others. The zone is silent on if it has to be balanced at all times for the percentages and uses. What if there is no demand in one of the three uses you have in a master plan? It is unclear how or if you can change it. Is the goal of the zone to stop development? It would be easy to do with this zone.

David Harlan asked Smith about his opinion of the Hovee market study. Smith said it encompassed what Hovee could see as native local demand but not what a developer could create. It states there is little demand for a hotel, but demand for office; no demand for industrial, but commercial. This highlights the difficulty of the 3 use - 60% criteria in the zone in that you can create something different as you proceed. What about a trolley car importing people from downtown? What about the windsurfers who need to park close to river access?

Linda Rouches stated that the City Council did not say the gas station had to move. Smith clarified his position, stating he wanted the gas station to move from its present site, but the zone specifically bans gas stations so it can't be located to a better spot with a more compatible design. The current gas station site is not included in the zone. Smith would like to see local traffic routed through that area and across a new bridge over the Hood River to connect the two sites. Rouches also said the view corridor is from 2nd and Oak Streets.

Cindy Walbridge thanked Smith for his comments and said she has been requesting a meeting with him for months. She would like the opportunity to meet and go over the entire zone with him prior to the first reading of the zone. Smith stated he sent his lawyer to testify at a prior hearing and the lawyer reported back to him that the "comments were unwelcome". Walbridge said her email correspondence was positive and was surprised to hear that. Smith also said every time he reads a revised version of the zone it appears that different things are sneaked into it. He feels the planning department wants to do its thing and then the developer has to fit in to it. Walbridge said she would welcome more comments to help with the big picture.

Smith went on to state the 75' setback is a mess. The 12-foot PAW with its 8' landscaping leaves 55' of ugly and in his opinion this was not well thought out; it needs flexibility, especially around the boat basin. The setbacks are not developer-friendly; what about a 75' average?

Linda Maddox asked Smith what would it look like if he could have anything he wanted? Smith stated in ten years he could tie the two waterfront areas together on each side of the Hood River via a bridge. He would create pedestrian-friendly direct walking routes to downtown. He would create housing units first to energize the area with residents. He would renovate industrial buildings into a "sports" showcase for local manufacturers. He would renovate the Expo Center into an agricultural showcase for local produce, wine, and art, etc. He is looking to develop a quality project that is a community asset and will add value to it.

Hoby Streich asked the City to comment if Smith's master plan interpretation was correct. Walbridge said a single master plan is required of the Port property to show integration.
Streich asked Smith about roadblocks. Smith said he would really like to have one master plan of both sites to maximize the future. Smith also stated he would redesign the roads around Hood River Distillers instead of letting them essentially condemn Port property for their use.

Kathy Watson asked about phasing and the three uses and percentage requirements in the master plan. Walbridge said the intention is not to have phasing. Rouches said the intention is to see mixed uses. Smith said this is a bad position to be in for any developer. He said the master plan in Bend changed over time and flexibility is very important; flexibility is not in this ordinance. Here, a developer has to predict the future and that is impossible. A developer is usually compensated by the value that is created over time. What if there is no demand or if it changes?

Rouches stated if the zone is not workable, it can be changed; the City Council wants a workable mixed-use zone. Smith said, then take out the restrictive and limiting language; e.g., requiring the PAW to have 400' access and state it is desirable to have it, but give the developer some flexibility

Watson asked for clarification of the hazardous materials issues. Harlan stated the Level 1 study states the whole area is fill so it would be uses on the land since the fill that would have an effect. Department of Environmental Quality (DEQ) approved the underground storage tank removal of the gas station (Barman) property. The Nichols boat basin remains a medium risk. Mike Doke stated the 2004 Level 1 study of the property found no hazardous materials. A Level 2 would be a more detailed study. Harlan stated if there is a problem, the responsibility and costs of a cleanup would be a negotiated item in the Development Agreement.

Fred Duckwall asked about the timeframe for the adoption of the zone if the first reading is postponed. Walbridge would like to go over the zone with Smith as soon as possible. Bohn asked if there were changes, would the zone have to go through the whole public comment process again? Walbridge said yes, if they were substantive.

Bohn asked Smith his opinion of the Port donating park land to the city and where he might participate? Smith could not see a benefit to development stating that a big 6-acre square park is crazy when you could take that 6 acres and spread it out across the whole developed area into really beautiful manageable landscaped areas. Smith is not considering any of the land north of Portway in a plan because the whole waterfront area has been taken out of a developer's vision with Luhr-Jensen in a long-term lease, a big square park on Lot 6, and continued industrial use likely on Lot 7. The cheapest you can do park space is with grass only and according to Smith that costs a minimum of $1.25 a square foot to maintain. Who will develop it; who will maintain it? Will it be the City, Port, Parks & Recreation? Bohn asked Smith if the master plan should include the park as part of it and Smith answered that the park should be developed on its own.

Smith closed by asking the city staff for language changes in the zone that are more general and not so specific.

At 11:20 a.m. President Bohn stated the Commission would go into Executive Session under ORS 192.660(1)(e) Real Property after a short break. At the conclusion of Executive Session, the Commission was called back into Regular Session at 1:00 p.m. No action was taken as a result of Executive Session.

The meeting was adjourned at 1:05 p.m.