The closer you look, the more problematic a new Port Townsend aquatic center appears. Operating costs would greatly exceed initial projections, according to the feasibility study prepared to boost the city’s promotion of a new aquatic/fitness center. The estimated annual operating expenditure of almost $2.1 million is more than twice the cost once projected by the city’s Sustainability Task Force and more than six times current operating costs for Mountain View pool.
To have any hope of avoiding financial failure, the new aquatic center would have to generate revenues as much asseventeen times greater than current operations, and hit that mark as soon the second year of operation.
And still a new P.T. aquatic center would run annual deficits of around $400,000.
Its projected operating costs would be greater than those of the Sequim YMCA and the Shore Aquatic Center in Port Angeles, and yet its revenue would be less.
These are just a few of the red flags that abound in the feasibility study for a new $38-$53 million aquatic/fitness center for Port Townsend. I discussed some of the problems with this document in “Drowning in Red Ink: Mountain View Pool and Proposed Aquatic Center.” Here I will delve deeper into why this “feasibility study” is a clanging alarm bell that should stop any responsible and prudent decision maker in her tracks.
A View of Port Townsend from the Rocky Mountains
The feasibility study was prepared for the city and its aquatic center steering committee by Ballard King & Associates of Highland Park, Colorado. They did not conduct any market research in and around Port Townsend or the rest of the county. Based on their report, it’s easy to conclude that they’ve never even been here. Their 69-page analysis exclusively uses census data and other exogenous statistical information, then extrapolates those statistics to our area.
They required pages of data, charts and graphs to reach the conclusion that we are an unusually old, childless and poor community, something we already know too well. Yet, despite heavy doses of data on demographics and economic conditions, they manage to say not one word about what is recognized here as our number one problem: our affordable housing crisis.
Anybody who had spent a little time on the ground here would know that our affordable housing crisis is driving demographics and economic challenges. It pushes young people and families away, and deprives employers of workers, depressing economic activity and stifling growth. Yet, not a peep about our biggest problem from these consultants in the picture they paint of Port Townsend’s population, economy and culture. Addressing that towering problem would push the pool way down the priority list of our immediate needs, and leave little money for the costly amenity of a new aquatic/fitness center.
Some of Ballard King’s statistical extrapolation produced manifestly absurd results, such as concluding that in 2022 the Port Townsend area likely had 1,305 people engaged in basketball, 173 adults participating in cheerleading, and 313 adults doing gymnastics. Other absurdities riddle their computations.
At the same time that they were crunching numbers to tell us how our community recreates and exercises, they ignored bicycling completely. Notice there is no entry for biking in the above table. Yet, we have one of the premier biking trails in the nation in the Olympic Discovery Trail and the gem of the Larry Scott Trail running from the Boat Haven to Four Corners. Those trails see heavy bicycle use every day, as do our roads and streets. But, again, not a peep from consultants sitting at their desks in Colorado trying to guess how we spend our time and stay fit.
They purported to exhaustively survey existing swimming pools in the area. But somehow they missed the fact that Cape George has its own pool and they placed the Mountain View Pool at Kala Point. Then they put the Kala Point pool in Port Ludlow. The Port Ludlow pools they relocated to Silverdale. This map also indicates two pools in Port Angeles, when there is only one, the William Shore Aquatic Center.
Map of area pools from page 41 of Ballard King feasibility study.
So detached are they from reality in Port Townsend, that on page 13 the Colorado consultants compared us to the State of Pennsylvania. One has to wonder if their report mixed us up with work they were doing for a community in the Keystone State instead of on the Quimper Peninsula, and where else in their report they confused us with other communities. This following graph, by the way, was used to make the case that our community is capable of spending quite a bit more money on recreational activities because the level of our expenditures for necessities — such as our very affordable housing — is below the national level and below that of… Pennsylvania(?)
The “primary service area” in this graph is Port Townsend, Cape George, Discovery Bay, the Tri-Area, Kala Point and Marrowstone; the “secondary service area” is everything in Jefferson County to the south of Chimacum.
Ballard King & Associates of Highland Park, Colorado, also concluded that over a thousand residents around Port Townsend and from the south county go to Planet Fitness and LA Fitness.
Table from page 30 of Ballard King report showing percentage of population they claim belong to fitness clubs.
The percentages in this table apply to the “primary service area” around Port Townsend. Ballard King estimated the population of that area at 21,551, meaning they believe that in and around Port Townsend, 884 people (4.1% of the population) patronize Planet Fitness and 280 (1.3% of the population) go to LA Fitness. There is, of course, neither a Planet Fitness nor an LA Fitness in Jefferson County. The nearest Planet Fitness would require a ferry ride to Oak Harbor or a drive to Bremerton. There are no LA Fitness outlets on this side of Puget Sound.
But there are two fine full-service gyms, Port Townsend Athletic Club and Evergreen Fitness. Ballard King didn’t bother to inquire as to the membership and usage of those facilities.
How much were they paid to churn this stuff out?
Risky Business
Several versions of a future aquatic center have been proposed: the “basic” model (pool only); the “basic plus gym”; and the Full Monty, a large swimming facility with several pools, gym, exercise rooms, meeting rooms, etc. — something on the scale of a large urban YMCA. Ballard King projected that the annual operating costs of the Full Monty would be nearly $2.1 million, with revenues of about $1.7 million and a deficit requiring public subsidy of about $350,000.
The subsidy for any aquatic/fitness short of a Full Monty would be somewhat higher because it would have fewer profit centers, e.g., weight room, yoga studio, etc. As I reported in my first article on this feasibility study, Ballard King recognizes that the many private gym and exercise studios existing in our community already, from full service gyms, to yoga and pilates studios, pose a “challenge” for the financial success of an aquatic/fitness competitor.
Herb Cook, a current Director and Past President of the Olympic YMCA, weighed in on the financial feasibility of aquatic centers in a Nextdoor comment on this issue. He wrote that the Sequim YMCA in 2019 (the last year before the pandemic lockdowns) had “more than 3,000 membership units (family and single) and 6,000 total members. Total revenue was slightly less than $2.2 million, total expenses slightly more than $1.8 million, net operating surplus more than $300,000.”
The Sequim YMCA is a Full Monty and then some. It offers a “six lane lap pool, a shallow family pool, hot tub, dry sauna, gymnasium, racquetball courts and wellness area.” It also offers basketball and volleyball and personal training and a steam room.
6,000 total members, 3,000 “membership units” make the Sequim YMCA feasible, according to Cook. Ballard King’s projections for the number of individual “membership units” for a Port Townsend aquatic/fitness center don’t come close. They project only 1,435 purchases of monthly and annual passes, 485 ten-visit pass sales, 55 daily passes per month.
The Sequim YMCA’s financial picture is the opposite of what Ballard King projects for a potential full-scale PT aquatic/fitness center. Where the Sequim YMCA brought in $2.2 million in revenue, PT’s top model is projected to bring in $1.7 million. On the expense side, PT’s projected operating costs would be almost $2.1 million versus just over $1.8 million for the Sequim YMCA. The amount of the projected PT aquatic/fitness center’s loss would be almost what the Sequim YMCA has seen as an operating surplus.
Proponents of a new PT aquatic center like to point to the William Shore Aquatic Center in Port Angeles. In my prior report, I showed that the projected admission fees for a new PT facility would be almost twice those charged at Shore. The Shore center relies heavily on property taxes to cover the difference between its operating costs and earned revenues.
Shore was built in the same era as the Mountain View pool and has undergone much maintenance, renovations, upgrades and expansions. It is now a very modern, attractive facility with several aquatic recreation offerings and a few “dry land” programs like yoga and personal fitness classes. It is situated in a younger community with a population more than twice the size of Port Townsend’s.
Yet it still requires a public subsidy of about $1.7 million annually, according to its 2022 budget. Those funds are collected through property taxes imposed by a metropolitan park district.
The Shore center’s 2022 budgeted operating costs were $1,622,715. This is a number generated with years of learning from actually operating the facility. The Ballard King projections for the comparable PT facility are $1,268,557, significantly below what the Shore center has found it needs to operate.
But we are supposed to believe that a PT aquatic/fitness center with higher operating costs, in a smaller community, with a very old and poor population, will need a subsidy only a quarter of the size of Shore’s? To hit that target, Ballard King assumes the aquatic/fitness center will enjoy a geometric jump in revenue that requires our old and poor population to pay admission fees about twice as high as those charged at the Shore Aquatic Center.
At least Ballard King, on page 50, near the end of their study, tells us not to take their projections to the bank. They disclaim any guarantee that their numbers may be relied upon fully. Do so at your own risk.
We Can Do That
No engineering analysis of what it would cost to upgrade and/or keep the Mountain View pool going as it is currently built was conducted before the push for a new aquatic/fitness center became public. Carrie Hite, the city’s Director of Parks and Recreation Strategy, stated in an email that, “We have opted not to spend close to $100K on a current full systems and structural analysis.” I have seen nothing to suggest that the city sought competitive bids for such an analysis. Hite could be pulling that number out of the air.
A full systems analysis was done for the city in 2001 by The ORB Organization, architects-planners-engineers, of Redmond, Washington. That analysis concluded, “The existing pool is quite adequate for basic instruction, training and aerobics,” but was not suitable for competitive swimming or diving. ORB examined all aspects of the pool and concluded it could be upgraded to meet current code requirements for $167,714 and its life extended for another 30 years–to 2031–for $355,113.
The roof does require replacement. Hope Roofing of Port Townsend conducted an inspection that found significant leakage and structural issues, such as soft spots where it would be unsafe to stand. City council recently had the option of fixing the roof properly, with a long-lasting, multi-decade solution, at the cost of $1 million. It opted for a temporary membrane fix that will last only a few years.
Hite wrote in her email that, “Parts for the pool are not manufactured anymore, so the pool is one breakdown away from closure.” We have also heard this at the town halls from Opsis, the Portland, Oregon architectural firm responsible for the conceptual illustration at the top of this article. They claim that parts for Mountain View’s pumps and filters cannot be purchased, so the pool only has a few years left before it must be scrapped.
But that is not necessarily true.
Workers at the Port Townsend Foundry
“We can fabricate anything for the pool,” Pete Langley, owner of the Port Townsend Foundry told me. His business is a custom and production nonferrous foundry in operation since 1983. They fabricate products from architectural castings to industrial castings to maritime hardware to antique replacements.
“I can build a pump from scratch. The equipment for a pool is not complicated. We can make anything the pool needs right here. We are a maker’s community,” Langley said. I was standing with him outside his operation in Glen Cove. He waved at other businesses that design and build sophisticated equipment and machinery. His “we” referred to his neighbors as well as his own highly skilled workers.
Langley is a current board member and the 2022 chairperson of the city’s Maritime Trades Association. “Look, we build boats. Some of the machinery in the mill is a hundred years old. The people in this town can fix a pool.”
Port Townsend’s annual Wooden Boat Festival is around the corner. The Port Townsend Foundry and other businesses here keep those magnificent classic boats going. They fabricate the hardware and parts “that are not manufactured anymore.” A pool’s simple filter and pumps are a lot less complicated and demanding than anything that heads out to the open ocean.
I have written Hite to ask if the city has consulted with Langley about fabricating locally any parts needed for the Mountain View pool. I am still awaiting a reply.
A Rigged Game
A decision was made by someone that a completely new aquatic center is going to be built. Opsis was brought in from Portland not to critically evaluate whether the existing pool could be renovated and upgraded, as the Shore Aquatic Center has been, but to promote a new pool through highly orchestrated “town halls.”
Opsis stands to land a lucrative architectural contract if the city gets the funding to build one of the versions of a new aquatic/fitness center.
At these “town halls” Opsis handed out colored circles with adhesive backing. Audience members were instructed to vote their preferences by sticking the dots on the artist conception of a new facility and selected features they liked (see our January 2023 article). Opsis did not make available any “No new aquatic center” option.
When questions were raised about the feasibility of addressing Mountain View’s needs, Opsis dismissed them out of hand. It was either go with one of the Opsis renderings of a new aquatic/fitness center or go without a pool — a stark choice that alarmed many of the frequent, elderly users of the pool who attended these “town halls.”
In the latest on-line survey people could vote only for which taxing method they like to raise the funds to pay for a new aquatic/fitness center. A “no new tax” option was not offered. At the last town hall held at Fort Worden on July 13, 2023, in response to a question from the audience Hite revealed that only about 150 people had been participating in the survey that was providing direction to the process.
“The Mountain View pool is nearing the end of its life,” has been the drum beat from Opsis and city manager John Mauro. That is an urban myth unproven by any engineering analysis. It is a talking point, and a talking point only, to drive people towards approving taxes to build a completely new, and vastly more expensive facility with implausible financial viability.
A responsible approach would have been to do a full engineering systems analysis at the beginning of this process. Instead, someone in City Hall launched a campaign to go after $38-53 million in new taxes to build a new aquatic/fitness center on a scale seen in larger urban areas.
The first installment was the $175,000 paid to Opsis for its drawings and “town halls” and whatever was paid to Ballard King for their “feasibility study.” Throw in the six-figure salary being paid to contract employee Hite whose job as “Strategy Director” is promoting the new pool (and a remake of the golf course), and all the time spent by city employees and others on the town halls and behind-the-scenes meetings to secure taxes for a new pool. We will never know what could have been accomplished with those funds if instead they had been invested in addressing Mountain View’s needs and finding a way to keep what we’ve got as they did in Port Angeles… and also Anacortes, by the way.
Opsis presents its final recommendation to City Council on September 5, 2023. Hite has said the goal is to get a proposed tax measure on a special election ballot in February 2024. The two tax measures under consideration are a property tax hike that would hit properties in Cape George, Discovery Bay, Irondale, Port Hadlock and Chimacum (and areas to the south), Marrowstone Island, and Kala Point, as well as Port Townsend. The other tax measure being considered is a county-wide sales tax.
Unsustainable. Without massive city subsidies, the Mountain View pool would be closed. No one knows how much larger the subsidies must be to sustain a much larger new aquatic center. All we have are predictions based on projections which are based on assumptions.
In every scenario, large subsidies continue for decades to come. The weight of these subsidies are contributing to pulling Port Townsend’s finances over a fiscal cliff, starting now, as it eats into reserves and cuts back on core city services.
We previously reported on how few people use the pool and how very, very few of them live in the county outside city limits. See “Mountain View Pool–By The Numbers.” This report will focus on numbers preceded by dollar signs.
Somebody Call a Lifeguard
The YMCA manages the pool under contract with the City of Port Townsend, which in turn leases the facility from the Port Townsend School District. The annual report for 2022 submitted by the Y shows a natatorium (swimming pool) awash in red ink. Any other operation would have drowned by now. But huge city subsidies keep this one breathing.
The city budgets $400,000 annually to subsidize the pool. It makes a large payment directly to the Y, which is then used to cover shortfalls and give the Y a nice profit for its services. It also picks up the tab for repairs. For instance, city council recently voted for a cheapie ($75,000) slap-dash sort of roof repair that will be good for only a few years, instead of properly repairing the roof with a multi-decade shield against weather.
The pool’s enormous losses are starkly revealed by backing out the city’s subsidy paid directly to the Y in the amount of $276,000. We can then see actual earnings from sales of passes, daily admissions and merchandise. These are the pool’s earnings.
The 2022 report from the Y also includes a couple of months’ results from the end of 2021 following reopening of the pool at the end of the pandemic lockdowns. Those results, covering operations from October 24 to December 31, 2021, show $51,308 paid to the Y. For the last quarter of 2021 the pool earned only $14,837. Against this paltry amount, the pool’s expenditures totaled $55,868. Minus the city’s subsidy, the pool lost about $41,000 in this period.
2022 saw the the pool’s financial health worsening. The pool’s expenses of $326,404 exceeded its $93,172 in earnings by $233,231.
The following table in the Y’s 2022 report shows a positive net operating figure. That positive figure is created by including the city’s subsidy, which is not earnings. It is an unearned infusion of cash. If the city’s subsidy of $276,000 is backed out, the pool’s earnings versus expenses is negative — the $233,231 loss highlighted above.
The Y spent less than $20,000 on maintenance. It purchased very little new equipment and supplies ($6,345). But $53,781 went to the Y for “YMCA Association Administrative Allocation.” This is not a payment for salaries. It is not an investment in the pool. It is in the nature of an additional fee extracted by the YMCA for its involvement in operating the pool. This is effectively the Y’s profit.
The YMCA Association Administrative Allocation for the last quarter of 2021 was almost $15,000. For the first half the Y took about $14,000, a number which may not reflect payments made in July for the first 6 months’ full “YMCA Association Administrative Allocation.”
The 2023 numbers reported by the Y, even with the slight uptick in usage, show more red ink. Expenses totaled $166,537 against earnings of $72,451, for a loss of $94,086. Only $4,619 was spent on maintenance. (It is possible annual passes are renewed/purchased in the first half of the year, creating a bump in first half revenue not repeated in the second half. As we reported in our earlier article, use of the pool peaks in the first half, then declines substantially the remainder of year.)
The Y’s Profits Eclipse Investments in Maintenance and Repairs
The Y takes more in profit — its Association Administrative Allocation — than it spends on maintenance and cleaning of the pool. Not only has it spent very little on maintenance and repairs, its facilities and custodial payroll for the first half of 2023 was less than $7,000. It spent less than $1,600 on janitorial supplies. In 2022 it spent less than $7,000 for an entire year on its facilities and custodial payroll.
Anyone who has owned an old pool knows that failing to address issues as they arise guarantees bigger problems and larger bills down the road. These financial reports suggest that the Y has decided to “let things go.” We can only speculate what could have been accomplished by investing in repairs and maintenance the $82,000 extracted by the Y as its profit during these periods of time.
Bigger Pool, Subsidies Forever
No one knows how large the subsidies will have to be to sustain a larger, new aquatic center. The city’s Financial Sustainability Task Force, on page 32 of its final recommendations, estimates annual costs of operation at $890,000, more than three times what it costs to operate the existing pool — not including the Y’s “Association Administrative Allocation.” Under state governing Metropolitan Park Districts, the junior taxing district being considered as the vehicle to raise property taxes for the pool, the city will be required to continue its annual $400,000 subsidy.
Will a shiny new aquatic center ever attract enough users to cover its expenses? Nobody expects that to happen, even the new pool’s most ardent advocates. Projections shared at the public meetings by Opsis Architecture of Portland, Oregon, the consultant working for the aquatic center’s task force, projects annual losses at $350,000 to $400,000. These figures, we have learned, come from a “feasibility study” prepared by Ballard King & Associates of Highland Park, Colorado. Opsis is being paid $175,000. (I cannot report at this time whether the fees paid to Ballard King are included in the OPSIS contract or are covered in an additional consulting contract with additional expenditures.)
I hope to write separately on the Ballard King report. I’m not sure they have been to Jefferson County. There are some glaring errors and omissions in their work, some of which are embarrassing and should give pause to any decision maker who would rely on this document to justify tying taxpayers to a project that will cost $38-$53 million, not including overruns and contract adjustments.
Ballard King’s financial projections for all the versions of the pool that have been discussed at the public gatherings presided over by OPSIS show deficits in the hundreds of thousands of dollars as far as the eye can see. These projected deficits, Opsis has pointed out at the public meetings, are about the same as the (broke) city of Port Townsend is spending now. To make the future financial picture for hugely more expensive, more complicated, and much larger aquatic facilities look not much worse than what the city is bearing now, Ballard King went out on a shaky limb.
Ballard King’s calculations rely on fantastically increased revenues.
Remember, currently the Mountain View pool has been earning less than $100,000 a year. To keep the required losses close to the current losses and the current level of subsidy, revenue must not only double or triple, but come at a level seventeen times higher. To lose only $352,572 a year, the “full build out” $53 million version would have to earn $1,763,761 annually. The “base and gym” model, to which it seems the city and task force are leaning, would have to earn 12 times more ($1,214,795) than the existing pool to keep losses at $403,015. Even the “base” model, coming in at a paltry $38 million, would have to see revenues increase eight-fold to $834,466 in order to keep losses at $434,091.
“If you build it they will come,” was a memorable line from a screen play by an author with a fertile imagination. It is hardly a prudent foundation on which to launch a $38 to $53 million construction project with tripled annual operating costs.
An “Aggressive Estimate” of Future Revenues
Ballard King admits that its projections are based on a “reasonably aggressive estimate of revenues generated from admission fees and passes.” How reasonable?
A lot more people would have to pay to use the pool and they would have to pay a lot more. Ballard King acknowledges that Jefferson County is poor and old, much more so than state and national levels. (How much were they paid to reach that conclusion?) As we have shown, only 174 Port Townsend residents and 34 county residents (outside city limits) used the pool on an average monthly basis in 2022. Ballard King’s calculations require that out of our poor and old population, about 1,106 people would have to use the pool on a monthly basis to make the “base” model projections work. Those numbers include 264 households, meaning the required individual usage would be even higher.
For the favored “base and gym” version, usage would have to soar to 1,413 users, which includes 524 households. To keep losses on the “full build out” version to the level of current subsidies, 1,974 user units (including 718 households) would have to decide to use the pool…
…and pay…
…and pay…
…and pay some more.
How Much Will It Cost to Use the New Aquatic/Fitness Center?
A lot.
Proponents of a new PT aquatic/center like to point to the Shore Aquatic Center in Port Angeles as an example of what may be possible here. Okay, let’s do that.
The Shore Aquatic Center charges $389 for an adult annual membership, $229 for youth and seniors, and $540 for families. What would PT’s new facility have to charge to keep losses around $400,000 annually?
Let’s start with the apparent favorite, the “base and gym” version. For an annual pass, an adult would have to pay $630, youth $265, seniors $420, and families $945 — close to double Shore Aquatic’s fees in most categories.
For a 10-day pass adults would have to pay $68, youth $50, and seniors $59. Families could not buy a 10-day pass, meaning each family member would have to pay separately, making a family visit quite costly. The Shore Aquatic Center, in contrast, charges $67 for a 12-day adult pass and $44 for youth and seniors. Families (with up to 10 members) can buy a 12-day pass for $133.
Ballard King’s report contains no discussion of whether the old and poor people of Jefferson County would resist paying such high prices.
How poor is Jefferson County? Household income in the designated “primary service area” of Port Townsend, Kala Point, Cape George, Marrowstone, Port Hadlock, Chimacum and Irondale is $20,000 per household below the comparable state level.
Projected “Primary Service Area” shown in red.
How old are we? “Much higher” than state and national levels and getting older, according to Ballard King. By 2027 the percentage of the population above 65 years is projected to increase from 58% to 75%.
Excerpt from Ballard King conclusions on Jefferson County demographics.
For Consultants’ Projections to Pencil Out, Existing Local Businesses Must Suffer
Where will all these new users come from?
Start with pulling people from existing gyms and studios.
“Within Port Townsend itself as well as the immediate surrounding area, there is a number of private fitness clubs and smaller boutique type providers. The private sector is the greatest provider of fitness space in the market,” writes Ballard King on page 43 of its report.
Ballard King openly admits what Opsis has danced around. Opsis has been asked repeatedly whether a new taxpayer-funded aquatic facility with an exercise component would compete with existing local exercise and recreation options. They have said more than “no.” To the contrary, Opsis has said that local gyms and fitness studios would benefit because they would gain more business. If this seems hard to swallow, it should be. This is like a Walmart developer assuring small retailers they will benefit by having a Supercenter open in their community.
Ballard King, on the other hand, recognizes that any version of an aquatic/fitness center will compete with existing local businesses. On pages 44-45 they admit the obvious: the existence of private providers in the area is “a challenge” to a future aquatic/fitness center.
In other words, a public facility that needs to pull 12-17 times the revenue of the existing pool would do better without our existing fitness providers continuing in operation. Local athletic centers and fitness studios might be put out of business in order to make this ambitious new aquatic center pencil out at “only” a $400,000 loss.
What About Likely Cost Overruns?
Has there been a public works project that has come in on time and on budget? Ballard King’s projections do not disclose any contingency for cost overruns. How much more could the pool finally cost? How would added construction costs be covered? Will greater public subsidies to cover cost overruns require more tax hikes?
Of course, the consultants offer no guarantees that their projections will prove correct, or even within some guaranteed margin of error. If their “reasonably aggressive” scenarios prove unreasonable and overly aggressive for Jefferson County, it is taxpayers who will pay for their errors.
But these are highly respected and highly paid consultants, you might say. Can’t we take their projections to the bank? At the same time we should ask, is there an incentive for consultants to come back with answers their clients want? As I will hopefully show in a follow-up report, Ballard King makes huge leaps from census data to the conclusion that the county’s old and poor population will gladly pay more and drive miles to experience a new Port Townsend aquatic center.
But for now, Ballard King’s own extrapolations from data should give reason to be skeptical about all their prognostications.
Consider the set of projections from the Colorado consultants. From afar, they looked at census data, recreational industry national studies and other exogenous data then applied it to Jefferson County. One example of this sort of desktop analysis resulted in the following table.
Their detached statistical analysis tells them that in 2022, Port Townsend and its nearby areas likely had 173 adult cheerleaders and 1,350 adult basketball players. Does anyone here know these 173 cheerleaders? Where do the 1,350 adult basketball players shoot hoops? How about those 176 adult wrestlers: where are they grappling on mats? Those 313 adult gymnasts: where can we watch them on the high bars?
They also concluded the area likely had 3,010 adults participating in swimming. Those are mere statistical projections. Real-world head counts from the manager of the Mountain View pool found only 174 adults in the Port Townsend area engaged in swimming on a monthly basis in all of 2022.
It is clear that these out-of-state consultants did their work from afar and did not actually spend much time talking to people here or observing how we live and recreate. Their study completely overlooks biking as recreation, labels the Kala Point pool as Mountain View pool on a map, and ignores the existence of the Cape George pool.
But, hey, they think there are 173 active adult cheerleaders and 1,305 adults in some sort of basketball league no one else knows about.
If you believe these numbers, then, by all means, believe that their construction and operating cost projections are rock solid and will come in on target. But before you commit, did you catch their CYA disclaimer in the fine print at the bottom of that table? “These figures do not necessarily translate into attendance figures for various activities or programs at a new center.”
Do tell.
The Y’s Cut… and Loose Ends
The best-case scenarios for containing losses close to where they are now kick in only in the second year of full operation. Unstated are the presumably much larger losses in the first year of operations.
Also not factored into Ballard King’s analysis is the fact that in addition to paying significantly higher charges to use the pool, everyone in the “primary service area” would be also be paying higher taxes to build and subsidize operation of the pool. That family that would have to pay $900 for an annual pass, could be paying an additional $400 in higher property taxes under a metropolitan recreational district tax, a sum of $1,300 each year (and increasing as assessments rise).
I discovered a glaring inconsistency between Opsis and Ballard King in their projections. Ballard King’s report does not assume there will be any payments to the YMCA for managing the facility. Yet, the slides projected by Opsis at the town halls show the same projected expenditures and losses, stating they are assuming that the Y will manage the pool and will be paid for its services. The Y, as seen above, is currently taking about $52,000 annually for its “Association Administrative Allocation.” This figure would likely be significantly higher for a larger, expanded aquatic/fitness center operation. If the new pool is targeting revenues 8 to 12 times higher than Mountain View pool, how much more will the Y be paid, and how much larger will be the deficits requiring taxpayer subsidies?
In conclusion, haven’t we seen this movie before? Where else in recent memory have we seen consultants painting rosy pictures based on specious projections for costly projects that result in gouging taxpayers for years on end?
The object lesson of the failed Cherry Street Project is still with us.
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Top image of swimming pool with red ink adapted from a photo by
Lewis Geyer/Digital First Media/Boulder Daily Camera via Getty Images.
How many people use the Mountain View pool and who are they? With numbers like $53 million being batted around — the projected cost of building a brand new aquatic center — more than anecdotal information is called for. To answer those questions we now have 18 months of post-pandemic data from the Olympic Peninsula YMCA, which manages the pool under contract with the City of Port Townsend, provided by the 2022 annual report and a just-completed report for the first 6 months of 2023.
In 2022, according to the annual report from the Y, Mountain View pool saw an average of 212 individual users each month. That number is calculated by adding together all individual users reported for each month of the year and dividing by 12.
Quite a few of these individuals use the pool a lot. For instance, in January 2022, 182 individuals were responsible for 1,287 total visits to the pool, or an average of just over seven visits per individual. Some of those 182 people may have used the pool only once. The Y reported 85 “drop-in” uses for January 2022. It is thus possible that fewer than 100 people (182 minus the number of drop-in visits) generated over 1,200 visits.
The Y tracked visitors by age and geographic area: 53% of users were older than 55; the largest single category of users was those over age 65 (40%). Less than a quarter of the users were under age 17.
Unsurprisingly, the vast majority of users live relatively close to the pool, within Port Townsend city limits. 82% of users in 2022 lived in Port Townsend; 16% in Jefferson County outside the city; and 2% traveled from Port Angeles to use the Mountain View pool. Applying these percentages to the average monthly usage, we can see that only 174 Port Townsend residents used the pool each month. Only 34 county residents outside city limits used the pool.
The data shows considerable use of Sequim and Port Angeles Y pools by people who also use the Mountain View pool. Those other cities reported 399 visits over the year from Mountain View swimmers.
The Y reported a total of 696 individual visits to the Mountain View pool in all of 2022. Clearly, some of those were one-time-only visits, as the monthly average of individuals using the pool is less than a third of that number. Mountain View saw a total of 15,815 visits for all of 2022. By comparison, the Fidalgo Pool in Anacortes, which is almost as old as the Mountain View pool, nearly matches Mountain View’s entire annual usage in just over two months. Anacortes has a population of just under 18,000; Port Townsend has just under 11,000.
The 212 average monthly users of the pool represent about 0.6% of the 33,000 people who live in Jefferson County. The 174 average monthly users who live in Port Townsend represent less than 2% of the city’s population. The 696 individuals who visited the pool at least once over the course of 12 months in 2022 represent 2.1% of Jefferson County’s population. The 571 individuals who live in Port Townsend who used the pool at least once over the course of 2022 represent a little more than 5% of the city’s population.
The graphs show that usage rose in the first half of the year, peaking in July. October usage was only 51% of July’s usage. December 2022 usage was 58% of July’s usage.
2023 Visits Up Somewhat
The Y provided a semi-annual report to the city on July 31, 2023, covering the first six months. It was not as detailed as the 2022 annual report. Significantly, it did not break out individual users by age and geographical area. The monthly average for individual users for the first six months of 2023 was 280. The monthly average for the first 6 months of 2022 was 220.
This number cannot be extrapolated for all of the 2023. Usage in 2022 dropped off significantly after July. This pattern may repeat in 2023. Data shows that usage peaked earlier, in April 2023 versus July 2022.
The total number of visits, on the other hand, remain fairly steady regardless of monthly differences in the number of individual users, suggesting that as in 2022 a smaller group of users account for most of the pool’s usage. But even their level of usage dropped as the year wore on.
A City Pool, Not Truly a Regional Pool
The steering committee behind the push to build a new aquatic center talks about Mountain View as a “regional pool.” A geographical area that includes all of Marrowstone Island, Cape George, Kala Point, Irondale, Port Hadlock and Chimacum, as well as areas to the south, is described as the pool’s “primary service area.”
The consultant from OPSIS Architecture of Portland, Oregon, who is working for the steering committee and who has led the town hall discussions and presentations to City Council and the Board of County Commissioners, has used the phrase “capture areas” to describe these areas of the county. He has done so in the context of reaching beyond city limits in order to find more money for the pool’s construction and operation. He and City Manager John Mauro have made it clear that taxing those “capture areas” is necessary to raise the tens of millions of dollars the city needs to build a new aquatic center.
But the Y’s report clearly shows that Mountain View is a city pool, not a regional pool. Only 25 monthly pool users live in the “capture areas,” according to the percentages shown in the 2022 pie chart pictured above. I asked Wendy Bart, CEO of Olympic Peninsula YMCA, if the same percentages of city versus county users has held into 2023. She has not responded.
Carrie Hite, the city’s contract worker who carries the title of “Director of Parks and Recreation Strategy,” and who is charged with driving the city’s quest for a new aquatic center as well as a reworking of the golf course, has expressed disappointment at how very few people attended the aquatic center town hall in the Chimacum High School Auditorium on April 27, 2023. That may be due to the fact that virtually no one in the “capture areas” uses the pool. It is considered the city’s pool — not Chimacum residents’ issue and none of their business.
Chimacum High School groups, according to the Y’s two pool reports discussed here, have not been using the pool, though classes from Salish Coast and Blue Heron in Port Townsend do. And until recently, when “No P.T. Pool Tax” signs started appearing along streets and roads, few in the “capture areas” had any idea that city leaders were eyeing their homes, farms and businesses, as well as their purchases at stores, for significant tax increases to fund the city’s dreams of a brand new, enormously expensive aquatic center.
The steering committee is led principally by city of Port Townsend employees but includes representatives from the PT school district, the port, the Y and county government. It is considering two taxing options:
One would be creation of a “regional recreational district” that could lead to a property tax hike of up to $0.75/$1,0000 of assessed value. This tax would be imposed on the “primary service area” shown within the red-shaded area on an image displayed at the last town hall and reproduced below.
The other option being floated by the steering committee is a county-wide sales tax increase.
Both options require public votes. The consultants and steering committee will present their final recommendation to the Port Townsend City Council on September 5, 2023.
Service Areas to create a “regional recreational district” for new taxation to fund the proposed aquatic center, as displayed at the last town hall. Red (Primary) delineates Port Townsend and county “capture areas” — Marrowstone Island, Cape George, Kala Point, Irondale, Port Hadlock and Chimacum. The blue line (Secondary) delineates boundaries for a potential county-wide sales tax increase.
Unsustainable. Higher taxes lie ahead for Port Townsend residents and businesses. But it won’t be basic, critical city services that get the biggest chunk of increased revenues if the recommendations of the City’s Financial Sustainability Task Force are followed.
The proposed aquatic/fitness center could get seven times as much in new tax revenues as would go to fix the city’s failing streets. Parks and forays into becoming a major housing provider would also see huge increases.
Public safety and emergency services would see little change. As for the the city’s aged, failing water and sewer lines, the task force chose to ignore the problem.
A water and sewer system is a core service of every city. “Simply put, without core services, all other initiatives and services suddenly or eventually fail.” That is the definition from the glossary of terms in the task force’s final report. But through a verbal sleight-of-hand, the task force declared it would not consider water and sewer to be core services and, therefore, they were excluded from evaluation of the city’s financial challenges.
Replacing the thirty-mile long, century-old system that brings water to the city from Quilcene will cost more than $114 million, according to the city’s 2019 water plan. Higher utility rates, increased borrowing and other measures will be necessary to cover the costs. Some sewer sections are at the end of their lifespan and require replacement now. A single failed pipe under Water Street is beyond repair and must be completely rebuilt, at the cost of nearly $3 million — which the city must borrow or pull out of its reserves.
It would be a lot harder to persuade taxpayers to approve high taxes for a new pool if they knew they were also facing staggering increased utility rates and other charges to repair and replace the sewer and water lines under the city’s crumbling streets. The price tag for that proposed new aquatic center, by the way, starts at $37 million and tops out above $52 million, along with an annual operating subsidy of about $900,000.
Rendering of the Mountain View complex to house proposed new aquatic center, from the consultants’ PowerPoint presentation. Multiple pools — a swimming pool, activities pool and therapy pool — are illustrated in the image at the top of the article.
Skewed priorities don’t stop there. The city’s pool consultants are enjoying a $175,000 contract, which is more than the city budgeted in recent years for road maintenance. It is more than the city has allocated to study the seismic stability of the Lord’s Lake dam, the principal source of the city’s drinking water. State authorities have warned that the dam is in very poor condition and could require $4 million in repairs — money the city doesn’t have. Not a word in the task force report about that.
Water for swimming got a lot of ink; drinking water got none.
But heavily taxing city residents to pay for a new pool — running up their property taxes by hundreds of dollars per year, on top of other recommended tax increases — isn’t enough. The Task Force, echoing the city manager and Port Townsend’s pool consultants, want to tax county residents to fund PT’s aquatic center. A project that cannot be sustained by city taxpayers has been proclaimed possibly sustainable if maybe county residents can also be taxed to pay for a new pool to replace one they don’t use now.
Fewer than 34 Jefferson County residents outside city limits use the existing Mountain View pool on a monthly average. That data was gleaned from the 2022 annual report from the YMCA, which manages the pool for the city. The same data shows that only 174 city residents use the pool on an average monthly basis.
Window Dressing for Higher Taxes, Expanding City Government
Council created the task force in November 2022 to address the city’s impending financial crisis. It carries an impressive title, but was little more than a handful of citizens hearing from and reading materials provided by City Manager John Mauro and his staff.
Five citizens were appointed but only four served. Troy Surber, PT’s former acting police chief, resigned his appointment before the first meeting. The other members were former city councilor and mayor Catharine Jackson, John Nowak, Rick Jahnke and Earll Murman. Earll Murman is married to Rena Murman, Treasurer of Jeffco Aquatic Coalition, the group spearheading the campaign to build a new aquatic center (more on that apparent conflict of interest below).
The task force had no chairperson. City manager Mauro ran its meetings. He and his staff set the agenda. The city manager determined what the group would talk about, who the speakers would be, and what materials would be considered. As far as I can tell, the city manager and his staff were responsible for writing the task force’s final report and recommendations.
There was good reason to create a task force, one that could investigate why Port Townsend’s finances have turned negative. The city is heading over a fiscal cliff. It has recently started to eat into reserves. We examined this impending dive into red ink in our May 25, 2023 report, “City Finances ‘Falling Off Cliff’ as Cherry Street Project Enters Seventh Year.”
But the task force did not dig. It did not inquire into waste in City Hall, ways current spending and staffing could be cut, or which programs and services could be scaled back. In fairness, such an undertaking would be an unreasonable expectation of citizen volunteers with no independent staff of their own. They met only a few times for about 2-2.5 hours each session.
The meeting videos reveal that the citizen volunteers were fed materials drafted by City Manager Mauro and his staff. None of those materials offered an austerity option, ways to shrink city government to fit the city’s limited financial resources. It was the city manager who labelled any course of action that did not include raising taxes to fund a new pool and other ambitious amenity projects as the “do nothing” solution. This derisive label was incorporated into the task force’s working materials.
Only those courses of action for continuing to expand city government made the cut in the final recommendations to city council.
Instead of meaningful inquiry into cutting waste and fat at city hall, the task force report tossed around vapid verbiage. It never got beyond bland statements like, “Finding efficiencies is a critical element for any pathway forward,” and “The need for efficiencies is eternal.” Rest assured, dear taxpayers, city hall has already engaged in “lean thinking” (page 19 of the report).
Repeatedly, task force discussions turned to how to sell higher taxes to a skeptical, tax-weary public.
Yes, plans to fix the streets are in there. New taxes have been recommended, anywhere from $0.10/$1000 to $0.20/$1000 of assessed value to start a thirty-year effort to keep Port Townsend from continuing to have the worst streets in the state. But the tax increase recommended for the aquatic center is seven times higher, $0.70/$1000 if the tax is imposed only on city properties. If county properties are “captured” (the city’s pool consultant’s term) and share the burden, the recommended tax hike would be $0.42/$1000.
No course of action was advanced that would increase funding to complete street repairs in under three decades.
No options allocated all revenue from higher taxes to critical, core municipal services only — streets, water and sewer, public safety.
No course of action was discussed that did not include the aquatic center. From the task force’s initial meeting onward the aquatic center was considered a “priority initiative.”
Conflict of Interest?
As mentioned, Earll Murman, one of the four task force members, is married to Rena Murman, Treasurer of Jeffco Aqautic Coaliton (JAC), the advocacy group spearheading the push for the new pool. Rena Murman is also the registered agent for JAC. That group originated in 2007 under the name “Make Waves in PT.” In 2012 Earll Murman became the group’s president and chairman of the board. In that year it changed its name to “Jeffco Aquatic Coalition.” Annual reports filed with the Washington Secretary of State show him as the JAC President from 2012-2017. In the 2018 amended annual report he was listed as one of four JAC governors. In 2022, just a few months before Earll Murman was appointed to the city’s Financial Sustainability Task Force, Rena Murman filed and signed the annual report for JAC, identifying herself as one of three governors and the group’s treasurer. A quick search of public filings with the Washington Secretary of State revealed this information.
More and More Taxes
The task force recommended other tax increases and ways to bring more money into the city. Annexing Glen Cove and grabbing its property and sales tax base from the county is central to long range plans. The drop in the city’s utility tax scheduled for the end of this year would be reversed and further increased by about 9%. Property tax rates would be raised across the board. And the task force is recommending another hike in the local sales tax.
To generate tax revenue for the proposed aquatic center, the task force recommends creating a Metropolitan Park District to tax city properties or a Regional Park District to capture county properties. This would require formal action by council and a public vote. If the borders of the taxing district extend beyond city limits, the county commissioners would also have to be on board. A park district can impose a property tax of up to $0.75/$1000 assessed value. An effort to create a park district to fund the Sequim pool was defeated in 2015.
There is also a lot in the report about funding the city’s foray into becoming a major housing provider and remaking the golf course, and how the city’s budget must increase accordingly. We will take a closer look at the these issues in future reports.
City Council is scheduled to act on the task force’s recommendations in coming months. The task force’s 53-page final report may be read at this link.
Dave Timmons has had enough. The former Port Townsend City Manager (at left above, speaking to the city council at their June 12 meeting) came out of retirement in 2020 in response to requests he step in to save a collapsing Fort Worden Public Development Authority (PDA). He gave his contractually required 90-day notice to the PDA’s Board at its June 27 meeting. Ninety days out is also just about the time the PDA’s financial team says it will run out of money.
Timmons cannot be accused of fleeing from a sinking ship. He jumped onto one in 2020, only to learn that the PDA’s hull was riddled with rot and worm holes. As I wrote after watching his heroic efforts in that year, he worked miracles. He managed to steer away from the shoals an organization hobbled by nearly a decade of incompetent and less-than-honest management. He let it be known that the PDA was “a house of cards” ready to collapse from the weight of debt burdens impossible to bear and the misuse—as well as outright theft—of funds by former management and a senior employee now facing criminal prosecution.
He crafted a spin-off of the hospitality arm of Fort Worden’s operations, the only way the operations could survive. His leadership attracted incredibly generous donations. He secured additional credit from lenders already facing millions in losses. He persuaded vendors to be patient about being paid.
Before he stepped onboard to lend an assist and then to helm the PDA that organization had never—never—received a passing audit from the State Auditor. Timmons inherited incomprehensible financial records. He oversaw the gargantuan task of converting from accrual to cash-basis reporting. He did all this with a skeleton staff who joined him in working miracles.
But it may have been a hopeless cause all along. The costs of maintaining ancient, obsolete buildings, heating and electrical systems and plumbing has always been a millstone. Revenues have never been enough to keep up. And something major always breaks. The costs of repairs keep rising. There’s never enough money.
As PDA Board Chairman David King (in blue shirt in top photo) told Port Townsend’s city council on June 12, 2023, “We are not currently sustainable.” The maintenance costs are crippling. and the PDA has “no revenue source for debt” incurred by the prior PDA Board and Timmons’ predecessor.
This is a critical time for the PDA, but Timmons has decided he must leave the organization he has worked so hard to keep alive. It is clear from his letter of resignation and other comments that the impetus for his departure is a deteriorating relationship with Port Townsend City Manager John Mauro and City Council.
“We have reached the threshold that cooperation doesn’t exist,” he told council and Mauro at council’s June 12 meeting.
Inheriting a Nightmare
I went back and read my reports from 2020 about Timmons’ rescue mission. I had forgotten the details about the daunting challenges he faced.
“Fort Worden Out of Money…” led the headline for an article I wrote in December 2020. The opening paragraph explained:
“We really don’t have a future if we try to remain status quo,” David Timmons, Acting Executive Director of the Fort Worden Public Development Authority told its Board of Directors at their December 9, 2020, special meeting.
“The PDA will run out of money in several weeks. It needs over $1.5 million to cover operating and capital costs over the next six to seven months, and then it will face over $1 million a year in maintenance costs while the hospitality industry, its major source of funds, recovers from COVID lockdowns.”
Timmons found a way to keep PDA breathing another 2.5 years.
“Its financial reports have never been reliable, according to all the audits conducted of the Fort Worden Public Development Authority by the State Auditor. Every audit since the FWPDA opened its doors has found inaccuracies, omissions and failures to comply with required accounting practices. Recent discoveries, which will be addressed in upcoming audits, have uncovered massive malfeasance and irresponsibility that jeopardize the organization’s continued existence.”
$125,000 per “luxo tent”! None have ever been rented, not a dime has come back to the PDA.
There was probably no one else in our community up to the challenge.
What’s changed now to prompt Dave Timmons suddenly to submit his resignation?
Mauro versus Timmons
Timmons was Port Townsend’s first city manager. (Michael Hildt was the first “City Administrator.” Timmons was the first to hold the title “City Manager.”) According to a 2019 Peninsula Daily News (PDN) article reporting Timmons’ retirement as PT’s city manager, he graduated from Michigan State University with a degree in environmental studies, then went to work with the Michigan Department of Natural Resources as a zoning manager. In 1978 he was chosen as a city department manager for a town in Michigan’s Upper Peninsula then moved on to be the first township manager. He later declined an offer to be Marquette, Michigan’s first city manager and moved to Cochester, Vermont where he served as city manager for 12 years. In 1997 he consulted with FEMA to help the state with four disaster events and was nominated by then Vermont governor Howard Dean to be the state’s secretary of labor. In 1999 he was hired as Port Townsend’s city manager and served continuously for the next 20 years.
At the same time Timmons was asked to come out of retirement to save Fort Worden, John Mauro was stepping into Timmons’ shoes as PT’s second city manager.
Based on information presumably provided by Mauro, the PDN reported that he was coming to Port Townsend from a high-level, high-responsibility job for the City of Auckland, New Zealand. “Mauro currently reports to the Auckland Council CEO,” the PDN related. “He is directly responsible for 20 employees and has a budget of $211 million.”
That wasn’t true, as I reported in an October 2020 article (“Who Is John Mauro?“), I had contacted the city of Auckland seeking confirmation of the PDN story. The response contradicted these claims about Mauro’s qualifications. Auckland’s mayor had referred my inquiry to the Auckland Council CEO in whose line of command Mauro’s position would have been. Through a spokesperson he told me that Mauro did not report directly to the Auckland Council CEO. He was a mid-level bureaucrat in the planning department under a General Manager. He was not “directly responsible for 20 employees and a budget of $211 million.” Half that number of employees reported to him and the budget for which he was “directly responsible” was $1 million. That was in New Zealand dollars, which is about the equivalent of just over $600,000 US.
Mauro’s job in Auckland was “sustainability officer.” He and his small team, as a New Zealand publication reported, “provide thought leadership, drive strategic direction and champion change.” Change in terms of addressing climate change.
Mauro didn’t build anything, maintain or build roads and sewers or oversee police. He provided “thought leadership.”
Fast forward to 2023. The city now managed by Mauro, as we reported May 25, 2023, is heading over a financial cliff. Mauro overspent his current budget by millions due to hiring consultants for projects the city admits it cannot afford (e.g., a new $50 million aquatic center, a remake of the golf course, and the Evans Vista development). The city is eating into reserves and cannot maintain its failing streets. I recently learned from a source in the Sheriff’s Office that county law enforcement is still covering patrols for a city department lacking adequate staffing to do the job.
Mauro publicly defends the city’s “solid financial position” to continue providing basic services. But with Mauro’s unique hold on the English language, in the same breath he qualifies that the financially-solid city’s “ability to continue to do so is hindered by increasing costs in excess of revenues and a steady erosion of services and level of service.” Translated from Maurospeak, the city is heading “over a cliff,” the exact, unvarnished words used by the city’s Financial Sustainability Taskforce.
Mauro had followed his wife to Auckland where she had secured a teaching job. Before that he had been a bicycle activist in Seattle.
Power Play
Mauro wants more control and power over Timmons and the PDA.
The PDA has been slow on churning out financial reports to meet the city’s deadlines. This is being used as a reason to subject the PDA to direct city manager control over its financial affairs, strategic direction and other matters. The hook being used is the 2022 financial report. Under city code, it was due three months after the end of the fiscal year, in March. It was delivered in June. Other complaints have been raised, but in the “Draft Corrective Action Plan” written by Mauro and his staff, it is the annual report being 2-3 months behind that is the main justification for increasing city control over the PDA.
The financial reports provided to the PDA Board are matters of public record and easily available to Mauro and his staff, as well as members of the public. Financial reports were provided to the State Auditor. No request for information has been stonewalled.
Timmons operates with a skeleton staff. The woman described as “critical” to their accounting and reporting had been battling cancer and recently passed away, leaving a huge hole in the organization’s capabilities. As Timmons explained at his June 12 City Council dressing-down, the rest of his staff consists of a clerk at 32 hours/week, an administrative assistant at 32 hours/week, an accountant at 24 hours/week, and a contract CPA providing 10 hours of services weekly.
This is the entirety of Timmons’ staff for all PDA’s administrative, executive and accounting tasks. There is no money to hire anyone else. The services of the communications and public relations contractors, PDA Chair David King told Council, were ended because there is no money to pay them.
Mauro has also faced staffing shortages. He has filled gaps by hiring expensive outside consultants. City Council approved a $4.7 million supplemental budget to cover his overruns. Tax increases are looming ahead to get more money to run city operations. The PDA has no taxing authority. It cannot just demand that citizens give it more money, and it has no reserves to cover “supplemental” budget increases.
The PDA is currently required to provide quarterly and annual financial reports. Mauro is demanding that the PDA now provide monthly financial reports. At the June 12 Council meeting, Timmons explained that they do not have the staff to do that, unless those few staff people are taken off the other work they must do. Mauro was dismissive of the limited resources Timmons has, and somewhat mocked his vulnerability to losing any staff time.
(It must be noted that while Timmons was struggling with lingering problems from ten years of mismanagement and facility crises plus the loss of the full contribution of a key team member who was fighting cancer, Mauro took himself off on a five-week vacation after enjoying recent significant increases to his compensation package.)
Mauro’s “Draft Corrective Action Plan” would require the PDA to provide financial reports a week in advance of city oversight meetings, blaming past failures to do so on “struggles preparing the materials due to a lack of process and efficient financial reporting structure/form [that has been] hindering the FW PDA to meet required timelines.” Timmons and King tried to explain that the city’s meeting schedule does not align with the PDA’s own financial reporting schedules and creates huge problems for an understaffed accounting team. Their explanation fell on closed ears.
John Mauro (top left) responds to David King and Dave Timmons (at the podium) on June 12.
The rest of Mauro’s “Draft Corrective Action Plan” turns to inserting city staff in the business operations of the PDA. It would have the city get involved in utility cost allocation and negotiations with the “partners” (the tenants) at Fort Worden. The city would also direct the PDA in resolving billing disputes with the hospitality spinoff.
The PDA was recently forced to increase its line of credit to cover shortfalls caused by delays in the receipt of expected grants. Henceforth, under Mauro’s plan, the city will decide whether the PDA can increase its line of credit.
Mauro is demanding that the city have authority to approve or disapprove capital projects and capital planning.
Mauro wants the city to “monitor and coordinate on future PDA grant applications.” He wants to participate as a partner in strategic planning in order to “right-size the structure to meet future needs.”
Mauro wants to increase the PDA board to 9 members, with the mayor appointing at least three additional members.
All this to “correct” an annual report being delivered a few months late, even though nothing in the provided report was called out as being false, incomplete or incorrect.
It appears that the late financial report is being used as pretext, or at least an opportunity, to increase the city manager’s control over the PDA and its executive director. As Timmons pointed out to the Council on June 12, these are not “corrective measures. This is an enforcement action. We have reached the threshold that cooperation doesn’t exist.”
Timmons Resignation Letter Says More
Timmons submitted a lengthy letter of resignation. He reflected on his 45 years of public service and the challenges at the PDA that he, his staff and Board confronted together. He thanked the local institutions that stood by PDA and helped keep the ship from sinking. In that long letter, he provides more insight into his motivation for leaving now. He did not have much reason to recognize the city’s contribution to the fight.
Compared to the Herculean efforts of others, and the votes of confidence from lenders and vendors, the support of the City of Port Townsend pales in comparison. Banks extended hundreds of thousands of dollars in new credit. Private individuals donated half a million dollars. Lawyers donated valuable time. Architects, plumbers, construction companies, electricians and fuel suppliers did not act on overdue billings and “never wavered in supporting us with their patience….”
Jefferson County provided two grants, one for $378,000 to help secure debt restructuring and another of $150,000 towards restoring a critical building.
The Washington Department of Commerce helped the PDA secure and close out several grants, the last in the amount of $697,000.
The city, for its contribution, awarded “a competitive grant of $5,000 … and were cooperative with late utility billings.” But unlike the other players in this drama, the city acted to make life more difficult for the Fort Worden PDA, when “they passed code revisions more suitable to provide punishment for the past situation, not necessarily supportive of our current needs.”
Towards the end of his letter, Timmons said that he had learned in his long career not to take the path others would have you take when you know that is not the right path. “I believe we have reached the point where our paths are no longer in agreement.” For the “past several weeks,” indicating that this was a recent decision, he says he had been having discussions with some of the Board about “my desire to begin the process to transition to new leadership in the role of Executive Director.” He remains “open to discussions about serving in a limited role as an advisor to pass on institutional knowledge. But other events keep derailing this critical conversation while we continue putting out the most recent fire.” (Author’s emphasis.)
The PDA Board had nothing but effusive praise for Timmons, whose last day will be September 28, right about the time the PDA runs out of money. The hearing on Mauro’s plans to increase his control over the PDA is scheduled for August 21. A public hearing must be held before the plan can be voted on by Council.
For the video of the June 27 PDA Board of Directors meeting in which Timmons submitted his resignation, click here. The agenda packet for that meeting, containing Mauro’s Draft Corrective Action Plan and Timmons’ resignation letter may be viewed at this link. The resignation letter is attached as the very last document in the agenda packet.
