Port of Hood River Commission
Minutes of April 1, 2008 Work Session
Marina Center Boardroom 5:30 P.M.

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

Media: None

President Fred Duckwall called the strategic planning work session to order at 12:40 P.M.

1. Overview: Executive Director Michael McElwee stated the discussion would be about asset key issues and projects to obtain direction and to assist in budget development for 2008-09. Port Assets and Impacts: Port properties are at 71% occupancy with five buildings at full occupancy. Business Model: McElwee would like to review how the Port looks at its individual assets overall and how cost centers might be reorganized. Encouraging New Partnerships: McElwee stated the Port and City are working together on the wastewater treatment plant problem and also working with the County on the airport Master Plan. He would like to engage others to participate with the Port on issues. Waterfront Development: McElwee would like to ensure the road map to follow is still relevant. Economic Development Role: McElwee said there is some direction in the industrial lands report, but would like to review the Port's specific role and its relationship with the private sector. Long-term Financial Strategy: McElwee said the financial impacts of the electronic tolling system (ETC) are unknown at this time. He will be updating the Port Strategic Plan to address budgetary strategies for bridge maintenance and replacement along with other issues discussed today, including flex buildings on the waterfront. The Oregon Economic & Community Development Department is under reorganization and its strategic plan template will not be finalized in the near future.

2. Financial Management/Issues/Topics: McElwee reviewed performance measures to consider in regard to Port-owned properties. Determining the return on investment model best suited to the Port's cost centers was discussed. McElwee recommended the Port adopt a Return on Equity (ROE) cash-on-cash return. Finance Manager, Linda Shames, stated no matter how the Port determines the return for strategic purposes, the Port still must follow GASB methodology which includes depreciation and grants. She said she can establish a sinking fund to reserve cash, but cannot change her reporting methods. Also discussed were the cost-effectiveness measures such as cost per job created or retained in the building or in Hood River and quality of life. Kathy Watson stated she felt grants have value and should be acknowledged. Shames stated that there are finance measures and performance measures and they can be quite different. Grants are available to ports and the Port of Hood River has effectively obtained them for many projects. Hoby Streich asked about the Port's ROI goal; it is 5%. Watson suggested McElwee develop written performance measures to separate financial measures. McElwee would like to see the real estate performing assets be separated from park and recreation assets and will come back to the Commission with a proposal to discuss. Watson would like the impact on the economy by recreation to be considered as a cost-effectiveness measure. McElwee said it is very difficult to calculate.

Shames stated the auditors pointed out that the Port needs to depreciate the new North 2nd Street. Streich asked if the Port will be dedicating the street to the City of Hood River?

Shames said yes, along with Portway, in order for the subdivision to proceed. Shames said six new GASB standards were added involving internal controls and accuracy in distributing financial information to Boards and the public. She also said the Port is fully funded for PERS with no liabilities. McElwee informed the Commission that operations would not require additional personnel this year. ETC administration is being absorbed by staff. There are many other projects in the planning stages. Shames explained that the only current debt service for the Port is the bridge bonds at approximately $700,000 per year for 12 years.

The Commission discussed the issue of foregoing revenue for the benefit of community goodwill. The bridge ETC discount minimum is $20, where in the past the $50 ticket book was the only discount for frequent commuters. The commercial vehicles also have unlimited discounted travel with transponders where in the past they could only use six discount books, after which they paid full fare. This vehicle toll discount benefits all commuters, including those with low income and seniors. The Commission was not in favor of a separate senior discount. The Port foregoes approximately $275,400 in annual revenue in a number of areas, including bridge discounts, the 4th of July Fireworks Show, youth recreational activities, Harvest Fest, museum grounds maintenance, and the airport's events. It was suggested an article be included in the newsletter so that the community is aware of this.

The need for increasing the toll was discussed. There are no funds left in the Bridge Repair and Replacement Fund due to the bond payments, more commuters are crossings at a 20% discount with ETC, and the Port needs to plan for long-term maintenance needs in the next 20 years because it is likely that the Departments of Transportation of Oregon and Washington will not fund a new bridge. Peak-time tolling rates were also considered. Shames stated as she accumulates the data for ETC, she will have a better idea on the revenue. The Commission reviewed the status of grants totaling $1.4 million, both pending and awarded. The review of professional services was postponed at this time.

3. Asset Management/Issues/Asset Areas: McElwee said the development costs and resources will be identified for the budget process. He said the planning efforts and next steps are identified for many of the major projects. The Port/City relationship is positive and both entities are working together on the waterfront development process, including co-sponsoring an infrastructure grant, establishing an urban renewal district and assisting with the design of the treatment plant odor improvements. There will be a Port/City joint special meeting to discuss urban renewal on April 14 at 6:00 PM at City Hall. A review of the Port's Asset Areas commenced.

Bridge: Bridge project goals include establishing a painting plan, finalize ETC routine maintenance procedures, develop an ETC long-term technology program, and implement online customer account access. Shames will review debt service, future maintenance needs, reserve funding, and revenue needed. She stated the bridge painting is estimated at $16 million, but that the Port is working with the bridge engineering firm, HNTB, to develop a strategy to lessen the costs of full painting. McElwee stated the bridge replacement is not on any state's priority list but he will continue to work with the SR-35 agency group to find a solution.

Diamond Industrial - Big 7 Building: Mike Doke informed the Commission that the building tenants are reorganizing themselves into some of the empty spaces and have requested a new loading dock to accommodate their needs.

Waterfront Complex Development-Industrial: McElwee said the subdivision plan was submitted to the City Planning Department; it will be a 4-6 week process for review. Once the subdivision is approved, the Port can move forward with studying flex-space buildings and marketing plans. Other projects include improving the landscaping and general looks of buildings, including signage, construct an industrial street south of the Expo Center, complete sewer plant odor design project, complete Portway paving and sidewalks, obtain approval for urban renewal district, and identify broker for marketing of industrial property.

Waterfront Recreation: McElwee stated the watershed is headed for completion and that the Corps of Engineers will be completing a biological assessment of the sand on the Spit so that the Port's application to resculpt the sandbar may be done this next year. It may be an in-kind contribution to the Corps' watershed work. Projects include construction of a trail between the Hook and the Spit connecting to the waterfront park's east and west ends, improving the Event Site landscaping and upgrading electrical power, and improve the roads to the Hook and the Spit. McElwee said that Kerr Construction is crushing the City's old sidewalks and other dumped debris south of the Expo Center; they will have gravel to put on the roadways for this year. Streich said the road needs to be built properly and that gravel will only be a temporary fix.

Marina Park Commercial Buildings: Projects include exterior painting and wood maintenance of Building 1 (Chamber/Visitors Center), Marina Center Building asphalt and yard paving, develop and implement landscaping plan, and prepare to make tenant improvements for the available lease space on the east side.

Marina and Park: To increase activity and improve security and safety at the Marina, the Port's projects include expansion of 'C' dock, installation of a new security gate, improvements to the Marina electrical system, upgrading the Picnic Shelter for small gatherings, and tenant improvements for the Hood River Yacht Club once negotiations to lease the former Port maintenance building are concluded. To address the long waiting list for slips, staff will develop a true waiting list and deposit procedures for committed potential tenants.

Airport: Doke informed the Commission that the goals for the airport include finalizing a long-term use plan, modify the runways, determine optimum approach to airport management, increase level of airport activity, prepare a airport business plan, and develop a true waiting list of those on the waiting list and deposit procedures for committed potential tenants.

John Weber Business Park: McElwee stated staff will be working with Jerry Jaques to establish the procedures to organize a Property Owners Association (POA) to manage the common area maintenance, which is an irrigation system. The Port will assess the current owners this year in accordance with the CCRs for 2007 charges. Doke said the Port's building currently has 2,500 square feet available since January.

Wasco Business Park: Wasco Office Building will be fully leased by June. The parking lot redesign will be bid shortly and completed by the end of June.

Watson requested the projects show sources of funding whether by general funds or grants. This information is always included in the 5-Year Capital Plan for budget.

4. Economic Development: McElwee discussed the summary of leases as a way to look ahead to achieve 100% occupancy rates. Bohn asked if those responding to the Hovee survey, which may be outdated, could be contacted to see if they are interested in new development opportunities for locating to the waterfront in the near future. McElwee said there is a lack of available space now in the community for light industrial. In discussing the Port's role in community economic development, McElwee stated it seems like the Port is the infrastructure development agency and the County is the recruiter, and other agencies such as MCEDD and CGEDA are marketing tools. McElwee will follow up with the County on these specific roles to both bring new business here and to accommodate current business expansion. In regards to investment and acquisition strategy, McElwee said he will continue to bring all projects to the Commission for consideration. Because there is not much space available, marketing efforts are minimal at this time.

President Duckwall ended the work session at 3:45 p.m. The Regular Meeting of the Port Commission immediately followed after a short recess.

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Minutes of April 1, 2008 Regular Session Meeting
Port of Hood River Commission
Marina Center Boardroom

Present: Commissioners Sherry Bohn, Fred Duckwall, Don Hosford, Hoby Streich, and Kathy Watson; Attorney Jerry Jaques; from staff, Michael McElwee, Mike Doke, Linda Shames, and Linda Hull; Absent: Laurie Borton, Staff

Media: None

1. Call to Order: President Fred Duckwall called the meeting to order at 3:55 P.M. following the Strategic Planning Work Session.
a) Modifications, Additions to Agenda by Staff: None.

2. Public Comment: None

3. Consent Agenda:
· Approve Meeting Minutes of March 18, 2008, Regular Session
· Approve Lease with Dr. John Durkan for UTS Portsite
· Approve Resolution 2007-08-3 Authorizing Oregon Parks & Recreation Local Government Grant for Development of the Riverfront Trail

Motion: Move to approve Consent Agenda.
Move: Watson
Second: Bohn
Vote: Aye: Bohn, Duckwall, Hosford, Streich, Watson
MOTION CARRIED

4. COMMISSIONER, COMMITTEE REPORTS: None

5. Executive Director's Report: None

6. Reports, Presentations and Discussion Items: None

7. Action Items: None

8. Commission Call: Hosford asked about the joint meeting regarding urban renewal. McElwee said the projects and priorities will be discussed so both entities are in agreement. Elaine Howard will provide an update at this time. Jaques stated this should be noticed as a special joint meeting.

9. Executive Session: President Duckwall called the Commission into Executive Session under ORS 192.660(2)(e) Real Property at 4:00 P.M. Upon conclusion of Executive Session, the Commission was called back into regular session at 4:10 P.M. No action was taken as a result of Executive Session.

Adjourn: The meeting was adjourned at 4:10 P.M.

PRESENT: Committee members Chair Jeremy Young, Dayle Harris, Richard Clarke, John Benton, Port Commissioner Fred Duckwall, Port Executive Director Michael McElwee, FBOs Anne Yannotti and Denny Kindig, and Port Marketing Manager Mike Doke. Guests: Scott Gifford, NostalgAire; Gary Boggs and Shari Quary, Northwest Sky Sports.

INTRODUCTIONS
Chair Jeremy Young called the meeting to order at 10:10 a.m.

MAINTENANCE UPDATE
An update regarding the sinkhole near Runway 25 noted that excavation work was occurring the same morning but no source had been determined. If excavation didn't find the source, the Port planned to use an optical scope in underground pipes to determine if a leak is occurring.

The Port is contacting a local property owner before cutting down trees on the airport's north side that may be affecting the accuracy of the AWOS anemometer. Young suggested the Port use ribbons to identify which trees would be cut.

There was brief discussion about the grass runway, runway lights, tiedowns and signage. Regarding signage, John Benton noted "Authorized Personnel Only" would be more effective than "No Trespassing." Dayle Harris suggested that "Low Flying Aircraft" signs be placed on Orchard Road near the runway.

All maintenance projects are moving forward.

AIRPORT MASTER PLAN
A schedule regarding the county's review of the Airport Master Plan is expected anytime, and when dates are set Port staff will notify committee members.
There was a brief discussion regarding the Hood River County sheriff's election, and committee members felt it was appropriate to contact the two candidates to discuss the airport and its role in search and rescue operations and other community-safety issues.

NOSTALGAIRE UPDATE
Scott Gifford continues to be interested in moving permanently to Hood River, and was in town the past week to complete annual airplane inspections/maintenance. He mentioned he completed five annuals in just over a week, working long hours to meet the demand. He plans to return for more annuals in May. Gifford noted he has worked well with FBOs Anne Yannotti and Denny Kindig. Yannotti stated it is difficult to find the right aviation mechanic for an airport, and Gifford comes well qualified.

NORTHWEST SKY SPORTS CONCESSION AGREEMENT
Port staff requested that the committee discuss a proposed concession agreement for Northwest Sky Sports, although the final decision rests with the Port's executive director.

In the past, Northwest Sky Sports operated its glider rides, scenic flights and instruction from Hangar 1, now under lease by Insitu. To operate a commercial activity on Port property, a business must have a concession agreement with the Port. Since there are no other concession agreements at Ken Jernstedt Airfield, Port staff felt it was appropriate to consult with the Airport Advisory Committee.
Safety was the primary concern. Michael McElwee noted the Port had received some complaints regarding pilot Gary Boggs, especially during the September 2007 Fly-In. Young noted he has access to video documenting low flyovers that were beneath the Federal Aviation Administration's regulations. Yannotti expressed concern about possible repeated safety issues regarding Boggs and objected to the concession permit. Harris noted that he has witnessed the glider approaching the airport that were flying too fast and too steep, noting it was some of the most dangerous flying he had ever seen. Boggs countered that he was not flying at low altitudes and felt he was flying safely. All sides of the issue were allowed to offer input, which McElwee will assess as he considers a concession agreement for Northwest Sky Sports. McElwee plans to make a decision prior to Blossom Festival Weekend (April 19-20), when Boggs has some scenic flights scheduled.

NEXT MEETING
No meeting date was set, but likely will be once the county's Airport Master Plan review schedule is announced.

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Waterfront Development Outreach
Notes of April 16, 2008 Public Meeting
Marina Center Boardroom - 5:00 PM

Attending: Staff members - Michael McElwee, Mike Doke, Linda Hull, Laurie Borton; Media - Sue Ryan, Hood River News; Others: Bill Fashing, Kris Gann, Linda Maddox, Ann Frodel, Jeff Houtz, David Ryan, Jeff Smith, David & LaVonne Povey, Alan Winans.

1) Meeting Overview: Michael McElwee welcomed those in attendance stating this was an opportunity to provide input to the Commission on the various projects pending for waterfront development. He asked the attendees to feel free to interrupt his presentation if they had questions or comments.

2) Project Updates:

Waterfront Implementation Strategy: McElwee explained accommodating both business development and recreation is a challenging process. Transportation is an issue given that there is only one entrance and egress to the area via 2nd Street interchange. The subdivision plan, when adopted, will provide for legal lots so that they can be sold or developed and road improvements can be done for dedication to the City. The Hood River Juice Company (HRJC) will have a big impact on the transportation with an estimated 175 trucks per week. The Interchange Area Management Plan (IAMP) and the Frontage Road feasibility study will be analyzing all the transportation options. The Port is receiving federal and state grants to assist with the industrial alley construction which would benefit adjacent property owners. Ann Frodel asked if Conditions, Covenants and Restrictions (CCRs) would be place to oversee the building designs? McElwee said possibly, and that all sales of property would include a Development Disposition Agreement (DDA) that would outline all requirements.
Interchange Area Management Plan: McElwee explained that this multi-jurisdictional plan (ODOT, City, Port) should be finished by this fall, incorporating all exits in Hood River. Also, the zoning cannot be changed or modified during this process. This group is also coordinating with the Frontage Road consultants in this process.
Frontage Road Feasibility Study: McElwee stated this new road over the Hood River could allow another connection to the waterfront. The study will take into consideration the Naito of the former Nichols property and Hattenhauer, adjacent property owners. This study will provide additional information to ODOT in its interchange plan. Feasibility of a new Frontage Road may be known by the end of May.
Delta Impact Assessment: This study by the US Corps of Engineers (COE) is to project the effects of the Delta buildup over time and will include a hydrodynamic model. There is concern the east side may impact the Marina access; the west side access is prohibited at this time. The cost to dredge the channels of 2 million cubic yards of sand would be too costly with not much economic impact. The new Delta land is a boon to kiteboarding and recreation, but there are concerns about fish habitat from the fish and wildlife organizations.
Urban Renewal Feasibility: The City and the Port are moving forward with implementing an urban renewal district on the waterfront, which would include improvements to the treatment plant, street infrastructure and park/trail construction.

3) Potential Future Activities and Next Steps:

Lot 1 Market Analysis: An analysis of Lot 1 will be carried out by 2009.

4) Discussion:

David Ryan asked if the Portway area would be developed as mixed-use? McElwee explained that residential would not be considered, but the design to move buildings close to the sidewalks would lend to some commercial possibilities. The zone cannot be changed or modified, however, until after the IAMP process is completed.

Kris Gann asked if the Port would consider build-to-suit for flex space for future resale. McElwee said all ideas would be considered. Gann stated lot coverage, building height, building façade, ratio of glass/windows/fenestration and walkways should be included in the design process or CCRs. There could be one-story buildings with 24' clear height and dock high or loading docks in the rear or two-story buildings with higher door height on the first level.

As there were no more questions or discussion, the meeting ended at 6:30 P.M.

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Waterfront Recreation Committee
Minutes
April 17, 2008

Attending: Members Steve Gates, Lori Stirn, Laney Gale, Doug Archbald, Ann Frodel, Michael Schock (Absent: Richard Sassara, Commissioner Hoby Streich); Commissioner Sherry Bohn; Staff Members: Linda Hull, Operations Manager, and Laurie Borton, Marina Manager; Guest: Kris Gann

Commissioner Sherry Bohn opened the meeting with no introductions needed.

Marina:
Expansion Update: Members reviewed the latest draft (Option 5-final) of the proposed new dock. Doug Archbald stated the optional dinghy dock would accommodate up to three dinghies and wondered if the Port might want to consider racked kayak storage. Consensus was that the plan was a reasonable design. It was asked if any boats would have to be moved during the construction period. Staff will notify those who may be impacted during this time. Ann Frodel asked if parking would be a problem with more tenants. Laurie Borton explained the parking lot is for the whole area, not just the Marina, and more parking is available throughout the Marina Park. Linda Hull said the Hood River Yacht Club and the Port are negotiating a lease for the old Port maintenance building. Doug confirmed it is going well and they expect to be in the building this summer. Ann asked if the Port could charge fees for the public ramp. Linda Hull said that is allowed, but the Oregon State Marine Board provides an annual maintenance grant for the parking/ramp/restroom and it hasn't been the policy to charge because of that. The fuel dock is operating and requires a phone call, which can be done on site, to the Hood River Shell station across the road. Kris Gann asked if there was a pumpout station; yes, it is on the fuel dock. There was concern expressed about the continual use of the overflow dock by young people as there may be more boat traffic with the additional slips. Laurie stated Mike Anderson, Marine Deputy, patrols that and issues warnings, but will cite repeat offenders. Ann thought the new park might provide a safer place for those people who want a swim beach.
Sub-Leasing Issue: Laurie gathered information from both Oregon and Washington ports and marinas. She explained that most Oregon port marinas do not sub-lease. The larger Washington ports do. Doug said the Hood River Yacht Club was in favor of sub-leasing. Steve Gates thought there is a compelling argument for more activity out of empty slips as long as they had the same insurance as the tenant. Laurie clarified that the sub-lessee would have to be able to fit in the slip and be limited to time (most have 7 months or less). Sherry Bohn asked about the workload for staff. Linda said Laurie spends a large amount of time on the Marina as it is. Laurie felt the option that requires the tenant to be responsible for the sub-lease would require less staff time to manage. Sub-lessee would be required to provide insurance to the Port. The administration fee was discussed. Most considered $250 too high, some thought it was reasonable and that the sub-lessee wouldn't have a problem with paying it to obtain the slip. All realized that the time to administer a sub-lease is the same for one month or seven. Consensus was that staff will prepare a recommendation for sub-leasing to present to the Commission that includes a reasonable administrative fee, time limits on sub-lease period, and amount sub-lessee pays should not exceed the rental amount. Laney Gale brought up the fact that the rental fees should be revised so that long boats on the end of the docks are charged more for their length.

Off-Season Review:
Event Site Kiteboarding (October 1 - April 30): Steve stated that the timeframe should change from October 1 through March 31, due to the conflicts he has seen this year in April. He said several CGKA members he talked to agreed that the winds are funky there and it's not a good place to launch or land as the lines come in over the grassy area. They offered personal support for a 6-month off-season period in the interest of safety to everyone.

MOTION: Ann Frodel moved to change the Event Site kiteboarding off-season timeframe to October 1 through March 31. Motion was seconded by Mike Schock. Motion passed by unanimous vote. Staff will take this recommendation to the Commission.

It was also noted and agreed by everyone that CGKA really "stepped up" and has demonstrated its commitment to safety and to working with the Port and CGWA on the local recreational issues. Linda read a note from Jim Grady, CGKA President, telling the Committee that the kiteboarding community really appreciates their ability to kiteboard at the Eventsite during the off-season. They will be self-policing the no-fly zone again this summer, and they wish to continue on its path of improved reputation.

2008 Season Issues & Recommendations (Discussion):
Oregon Parks & Recreation Trail Grant Application: Linda said the Port has a grant application into the Oregon Parks & Recreation for a Local Government grant for the trail. Lori said the results wouldn't come in until later this summer. The Hood River Valley Parks & Recreation District will contribute $5,000 to the project, if awarded.
Event Site: Website survey re: dogs: Linda said the Port's new website has a Take a Survey link for people to weigh in on this issue. She will let CGWA know about it so their members can participate.
Event Site: Upgrade landscaping: Linda said the Event Site would be spruced up for the season this year. Trees are being planted and fencing removed to make a more festive atmosphere.
Hook & Spit: Permitted school signage will be replaced showing the authorized schools and include more safety language.
Spit: Kicker - Slider location: CGKA is working with Deputy Anderson regarding placement and permitting. They have permission by the Port to store them along the shrubbery below the schools.
Spit: CGKA/CGWA flyer/signage regarding hazards, barges, "Kite at your own risk": The Committee felt there was actually too much information on the flyer and offered a few changes that Linda will incorporate into the flyer. It will be available for the booth attendant to hand out to new people coming in. Linda said the Port appreciated the work the CGKA committee did to try to inform beginners to the sport as well as spectators.
Nichols basin water quality summer studies update: Linda informed the Committee that the testing done by Riverkeepers and SWCA last summer indicated the water quality was not dangerous to those using the area. The Spit dyke actually allows fresh water to permeate through it.
Delta removal and fill project update: Steve said CGWA is very supportive of the Delta resculpting project that was delayed this year due to the studies now required. The Port hopes to have a permit for 2009 to accomplish this project.
Other: Ann asked if there was anything the Port could do to make the grass less soggy. Lori said that Parks & Recreation is using a new grass that is better suited to the area and said Steve Stampfli is the contact. Linda will follow up with him. Ann asked if the gate could be kept open until dark. Linda will check with Joe Pounders on the procedures for closing at night (It closes at dusk.). Harvest Fest at the Event Site in October was also discussed with concerns for parking.

Meeting was adjourned at 4:30 p.m.