A new chapter for the Satsop Business Park

Tami Garrow likens the pending Port of Grays Harbor takeover of the Satsop Business Park to “turning Pinocchio into the real boy.”

It’s the natural evolution, says the outgoing Satsop CEO with animated enthusiasm, of a business and development park that has grown over the past 13 years from the abandoned remnants of the Washington Public Power Supply System’s ill-fated nuclear power project. Now, pending consolidation with the Port, Garrow believes the public-private enterprise is ready to fully mature into something bigger still.

“The Port has really come into its own, and the future is very bright for them. Being a part of that is the natural next step in the evolution of that property,” Garrow said.

She has been working at the business and development park since it was first conceived. She was the second person hired there, in 1999, and took over the head job just before a stinging state audit for 1999-2000 that found the facility was running out of money and needed better fiscal management.

“We have had clean audits ever since,” Garrow said proudly, noting that the business park currently completed a no-findings audit for 2010-2011, so the Satsop Public Development Authority can hand over operations to the Port with a clean financial ledger. “We have had nine years of clean audits.”

Garrow’s announced retirement several months ago highlighted ongoing discussions about a consolidation with the Port, and she hopes to leave with the park in good hands as the final decisions are being completed for a major shift in the park’s management.

“We’ve managed our assets pretty conservatively, which is a good thing. And we have had to do that out of necessity because we have had no safety net,” she said. “There is no source of income other than what our customers are generously willing to pay us to lease land or buildings or purchase our utilities.”

When the business and development park was formed, it started with a $23 million stake from the agencies that had been involved with the aborted nuclear power project. In those early days, Garrow said, the new operations team used the model of a port to outline how to do business.

Facilities had to be created. Fiber had to be brought to the park, roads had to be constructed, abandoned office space needed to be cleared out, holes needed to be covered, and a massive amount of equipment for a nuclear power facility had to be dismantled and sold.

“We experienced some financial struggles early on, but we got our act together and from that point forward I have tried really, really hard to maintain a healthy cash reserve,” Garrow said.

Managed with an annual budget of about $3.2 million, the business park has about $65 million in assets before depreciation, and about $800,000 in debt, which Garrow said was mostly short-term.

PORT POSITION

The stable financial position is attractive to the Port, which has been experiencing record growth even while other elements of the Harbor’s economy have struggled.

Once all the contracts are updated and reviewed for leases at the facility, the Port plans to take over the Satsop Business Park by the first of the year and operate it much like a separate division of overall Port operations, similar to how the Port operates the Westport Marina.

So far, the proposed consolidation has met little public opposition, but it signals the elimination of the Public Development Authority that manages the 1,700-acre mixed-use business and technology park.

“It’s not often a board votes itself out of existence,” said Steve Poler, the chairman of the Satsop PDA. “But in this case, it was the right thing to do and the right time to do it.”

Port Commissioner Jack Thompson, also a member of the Satsop PDA since it was first formed, said the marketing and operations won’t change much, and the current Satsop management staff will be kept on the job as part of the Port payroll. The three-member Port Commission will assume oversight of the business park for the 7-member PDA.

“We market property here at the Port, both uplands and marine business, so that’s the thing that makes it appealing. There is such a similarity when you take a look at the operations,” Thompson said at one of two public workshops on the proposed consolidation.

“We’re both public agencies. We are both charged with the same goals, and that is increasing employment,” Thompson said.

One of the non-traditional uses at the site is a training ground for everything from forestry classes for Grays Harbor College to tunnel training for fire departments and for Laborers-Employers Training Trust. Recently, the Seattle Fire Department used Satsop to train for tunnel emergencies in a pair of underground 12-foot diameter pipes that were once constructed to carry water to and from the twin cooling towers that still stand at the abandoned nuclear power project. Another tenant is the Regional Education and Training Center, which retrains displaced workers for new skills. The park features a driving course for semi-truck instruction.

Thompson vowed the Port would continue those enterprises and look for new ways to market the training center.

“They are customers, and customers are No. 1. I can tell you from my perspective as a Port commissioner, I don’t see any of that changing,” Thompson said.

With Garrow retiring and business manager Rocki Horton also leaving, Thompson said he hopes to get most of the consolidation completed while Garrow still is available for consultation. The PDA will hold its last meeting next month.

TRANSITION PLAN

The Port has already put together a full operation plan, something that has been the chief responsibility of Port Executive Director Gary Nelson. Nelson said the Port has completed advertising for a director for the facility. The ad for the position states the Port is recruiting “a dynamic leader with experience in business recruitment and development.”

“Responsibilities include customer service and marketing (business park) assets to current and potential tenants, negotiating leases, developing and implementing business plans and budgets, supervising the park staff and implementing the economic development goals of the Port,” states the ad, which is running statewide on the WorkSource online site as well as in publications such as the Puget Sound Business Journal.

In the interim, the Port and the PDA are operating under an interlocal agreement that allows the two bodies to work together and share information and decisions pending a full takeover by the Port, which could be completed before Christmas. Nelson and other Port staff members had meetings with a number of Satsop tenants last week “as outreach so they know who we are and try to alleviate any anxieties that can be associated with the impending change.”

“From my standpoint, it’s going as smoothly as can be expected,” Nelson told Port commissioners on Tuesday in a briefing on the progress. “It’s a big task.”

Port staff this week also started meeting with individual employees at the business park to explain how salary and medical benefits will be transferred starting on Jan. 1. When the consolidation officially takes place, the Satsop budget will be merged into the Port’s 2013 budget as a separate business division.

Currently, the PDA owns all the assets at the park, including the land, buildings, water rights and most of the utilities and infrastructure. Under consolidation, those would transfer directly to the Port, which essentially keeps the assets with the citizens of Grays Harbor. All leases and contractual agreements also would transfer from the PDA to the Port.

Marc Horton, the Port’s director of environmental and engineering services, previously was a consultant at the business park and has a good working knowledge of the layout there. One of his early jobs as a consultant for the PDA and the Grays Harbor PUD was to gather all the infrastructure drawings from the construction site before it was closed down as a nearly completed nuclear power project.

“It’s come full-circle for me,” he said. “It’s changed a lot. We’ll be looking at their inventory, and I’m sure they have a program for managing their assets, so we will be looking at all that stuff.”

Horton said he welcomed the challenge in the Port’s operation of Satsop.

“They have done a wonderful job up there. To me, it always has been a place that has plenty of opportunity,” he said.

CITIZEN CONCERN

The consolidation has not drawn much public opposition, although Port Commissioner Tom Casey, also a Satsop PDA member, has complained about not having enough discussion about the idea before initial agreements were approved.

Janice Branstrom of Aberdeen has been attending Port meetings for the past several months and told Port commissioners recently that she was skeptical of the consolidation.

“There is probably more interest than you are aware of,” she said about the plan.

The citizens group, Friends of Grays Harbor (FOGH), has submitted a letter outlining two concerns its members would like the Port to address: The management of the 1,200 acres of forestland at the site, and whether the Port Commission should grow from three members to five members that are elected countywide.

“We are concerned that, with the growth and diversification of responsibilities the Port is planning to take on, the Port Commission is too small,” said the letter signed by Arthur Grunbaum, president of FOGH.

The letter notes that the Satsop PDA has seven members compared to the three-member Port Commission, and suggests the Port move toward a five-member commission elected countywide.

“A three-member commission does not reflect enough public involvement in such an important economic conglomerate,” the letter states.

“Our experience with the Port is that they are less than forthcoming with their plans and what they actually intend to do,” Grunbaum said. “So there is suspicion.”

FOGH also wants assurances the Port will manage the forestland in a sustainable fashion that allows it to “mature for wildlife old-growth habitat” and that it maintain the current relationship with Grays Harbor College where the forest is used as part of the school’s forestry program.

Grunbaum notes the business park is responsible for sustaining the forest as part of mitigation for the former nuclear plant site development.

“To take that and change its intent into something different, we just think that is a bad precedent,” Grunbaum said.

Rollie Irwin of BMT-Northwest, the park’s largest tenant, said he sees the consolidation as a benefit for his business as well as local citizens.

“I look forward to it. The park needs some help and Grays Harbor needs some help,” he said. “I think it will help both.”

The other option is to bring in someone to replace Garrow, he said, and that person might not have a full appreciation for the history and potential of the business park.

“It’s got so many things it can offer different types of companies,” Irwin said. He said hi s biggest complaint is the phone system at the park, something he called “archaic, so maybe we’ll get some of that approved. That’s my only complaint about the park.”

Mike Warren, director of the Northwest Laborers-Employers Training Trust, which conducts a number of training programs at the business park for construction, tunnel work and now for firefighters working in tunnels, said he doesn’t see consolidation with the Port as having much of an impact on his operations.

“It’s not really in my wheelhouse. My only question was how does it affect me? But it doesn’t,” Warren said.

GARROW’S FUTURE

Under current operations, Garrow calls herself the landlady, the marketing director as well as the CEO.

“It’s a one-stop deal,” she said. “We’re the water department, the sewer department, the phone company, the fiber company, the landscaping guy, the building painting guy. We do everything but the garbage and the electricity. We’re pretty much everything else.”

With a staff of about a dozen, Garrow said “our reach is pretty limited” and the Port has a “deeper bench.”

“They have people with engineering expertise and environmental expertise. They’ve got a Chief Financial Officer. They certainly have a broader reach in terms of marketing, and they do business internationally. They have a great reputation in the shipping community in the industrial community and in the Western United States,” she said of the Port.

The business park now has 35-40 businesses with a “wide variety of customers, and we have diversified our activities so we are in a healthy place financially,” Garrow said.

In all, about $35 million has been spent on the park’s development in the form of improvements, roads, fiber, phones, water and sewer extensions, wastewater treatment improvements and new buildings.

“I would certainly like to have every building full, and we still have space available,” Garrow said. “But we’re in a spot where we are able to take good care of what we have been given and be ready to take care of the next customer that comes along.”

Garrow believes the park will be in good hands with the Port.

“I know it’s important (to the Port) to maintain the park’s identity,” she said. “It will be Satsop Business Park. Our logo and our marketing materials will be Satsop Business Park, a division of Grays Harbor Port.”

Angelo Bruscas, a Daily World reporter, can be reached at 537-3916, or by email: abruscas@thedailyworld.com