Port offers fish plant six-month extension

Steve McCasland, Bandon Western World

 January 22, 2008

http://www.bandonwesternworld.com

At a special meeting on Friday morning, the Port of Bandon Commission voted unanimously to enter into a standstill agreement with the Pacific Seafood Group regarding the use of the waterfront property the latter leases from the port.

In recent months, the port has taken legal action declaring PSG to be in default of its lease for failure to use the big blue building on First Street for marine industry. PSG operates a retail seafood market on the premises and does some product processing on-site. The company maintains that it has not violated the terms of the lease.

After discussing the matter in executive session on Jan. 4, the commissioners talked again in open session on Jan. 11, then voted to offer PSG a six-month period to study potential future uses of the site, while leaving both sides’ legal positions intact.

Commissioner Robin Miller prefaced his motion by saying that, after sensing the mood of the commission during the earlier executive session, he asked an attorney to put a standstill agreement in writing for the commissioners to consider.

“It’s easier to make a decision sometimes if you have a document before you,” he told the commission last week. “This agreement, if approved, will be presented to (PSG). It maintains both sides’ legal positions and establishes a framework to continue discussions through June 30. I would hope that the commission and (PSG) can sign this today.”

Port Director Alex Linke suggested the port would be “taking the high road” by approving the six-month extension.

“I’m convinced that we have a good case (regarding default of the lease), and that if we went to court, we would win,” he said.

Commissioner Reg Pullen, who opposed a similar motion proposed by Miller last month, said, “I’m willing to back off a little and work with these guys.”

PSG’s John Dulcich said that although he couldn’t officially comment on the proposed standstill agreement, it appeared to be “along the lines we discussed last month” in terms of studying the property’s potential development. He added that he favored the agreement’s inclusion of monthly progress reports to the commission.

Dulcich also asked who he (as PSG’s representative) would be dealing with at the port — a commission subcommittee, the port director or who — if questions come up or communication is needed.

“I just want to assure that there’s an open door,” he said.

In the ensuing discussion, the commissioners indicated they want to be involved, along with the port director.

Pullen said that the monthly progress reports will take place during regular open commission meetings.

“I feel that transparent government is an imperative,” he said. “And I want the commissioners directly involved. The future of this site is the future of the port, to a large extent.”

Miller pointed out that a subcommittee would help to facilitate the discussions and frame potential proposals.

“We’re not delegating the authority to make deals,” he added.

Following more discussion, the commissioners voted 4-0 to approve the agreement. Then, in a separate 4-0 vote, they agreed to involve all the commissioners (two at a time on a rotating basis) and the port director in the monthly discussions/reports on the site.

Commission President Donny Goddard, who owns a fishing vessel that delivers product to PSG, declared a conflict of interest at the beginning of the meeting and abstained in both votes.

Linke said that the process of determining the future of the site will take time.

“We have to involve the entire community, so we should take advantage of the state’s ability to help us with planning grants,” he added. “We’re interested in jobs for the community and income for the port. We should go slow and do it right.”

Pullen said he’d like any upcoming studies to “consider the full range of how the property could be developed. We have to meet the expectations of the community. A single-story complex may be better than a 35-feet-tall building.”

Staff, replying to a question from Pullen, said it had received a check from PSG covering its rent/lease payments for the first six months of this year. But, per port attorney Andy Jordan, the check has not been cashed. The agreement says the port will absorb the cost of the rent and utilities for the big blue building through June 30. In lieu of those payments, PSG is to use that money to “undertake and prepare site development studies.”

Miller mentioned that he’d like to hear more about an earlier PSG idea involving a possible tuna canning operation that could be located on the site. He also asked staff to prepare a chronology of the use of the property, listing when it has been used, by whom and for what.

Miller also suggested the commission discuss and determine its own priorities for the site’s development, but agreed with Pullen’s response that it “might be hard to reach a consensus.”

In response to another commission question, audience member Graydon Stinnett, who owned and operated fish processing plants here for years and now runs PSG’s local retail market, said the big blue building was constructed by Cutting and Rahn, a commercial fishing group.

“Then we (Bandon Fisheries) put the equipment in and processed the product from the boats,” he said.

Pullen: “At that time (late 1970s), they had about 50 boats contracted. The port’s job was to make sure the channel was dredged and that safety was addressed by having the U.S. Coast Guard here. What is the port’s mission now?”

After inquiring as to whether a boundary survey had been completed on the property and whether site maps and other information was available, Dulcich said, “Things have changed, and you don’t have the amount of fish coming through that you used to. We’re pursuing marine industrial uses and other opportunities for site development. There’s no 50 boats anymore.”

After the meeting, Dulcich said he’s happy the commission agreed to begin six months of dialogue on the property.

“We’re looking at various marine industrial uses, which we believe is a continuation of our current use,” he said. “That could include canning or net gear storage, or other uses. But we’re also thinking out of the box — about other types of things that may or may not be marine-related.”