Fort Worden PDA awaits answers on financial crisis, asks for support

Posted 12/4/20

In its first meeting since the enormity of its financial crisis was made public last month, the board of directors for the Fort Worden Public Development Authority appealed for patience from the …

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Fort Worden PDA awaits answers on financial crisis, asks for support

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In its first meeting since the enormity of its financial crisis was made public last month, the board of directors for the Fort Worden Public Development Authority appealed for patience from the public — and its support — as the organization attempts to stay alive.

At its previous meeting in late October, the board was told the Fort Worden PDA would run out of money by the end of the year unless $250,000 to $350,000 can be raised.

The PDA, according to Acting Associate Executive Director David Timmons, also needed Kitsap Bank to agree to refinance a loan and two lines of credit that total
$5.1 million.

Much of the organization’s problems come from shifting borrowed money from capital improvements, such as Makers Square and the “glamping” camping project, to fund the day-to-day operations of the agency. Timmons told the board approximately $400,000 was diverted from the Makers Square line of credit to pay for operations during the early days of the pandemic. Another $600,000 from the glamping project was diverted, along with $300,000 from an energy efficiency project loan, to pay for daily operations.

At the board’s meeting last week, members said they recognized the scope of the PDA’s debt issues that Timmons had earlier called “a house of cards.”

“Mistakes have been made,” said treasurer Jeffrey Jackson. 

But Jackson placed the blame on the impact of COVID-19 on the fort, and added that other hospitality-based businesses have also been waylaid by the pandemic. 

“Really, what I think is critical for this community to understand is the enormity of the situation that we face right now is completely about the impacts COVID has had on the operations.

“That is not an excuse. That is a grounded set of reality for anyone in this space,” he said. “It has impacted our financials dramatically; it’s impacted our people. We have many fewer of them.”

Jackson added that other businesses that center on travel and public gatherings were seeing similar impacts.

“The turnover has been extraordinary. And our ability to, frankly, survive,” Jackson said.

“Absent COVID … all of the issues we are confronting … all of them were solvable as normal business problems were it not for COVID,” he added.

NOT IN IT FOR GLORY

Jackson stressed that board members are not serving the fort for compensation, recognition or glory. 

“These are talented, ethical people. This community should be grateful for the people who are putting in this effort and the talents that they are providing,” Jackson said. “Regardless of the outcome and regardless of how you feel, we should all be grateful.”

He also asked for the community’s support.

“What we do need is, we need an understanding of the complexity and the difficulty of the situation before we can move forward. Most importantly, we need support. Anything we do without the support of this community and the various different constituencies that we serve, it just won’t succeed,” he said.

Representatives from the Washington State Auditor’s Office have launched an “accountability audit” of the PDA. Officials said the audit, which will cover 2018-19, will take between three to four months to finish.

FORT’S VIABILTY IS FOCUS

Board Co-Chair Norm Tonina said the board recognizes the depth of the problems the PDA is facing.

“As board members we serve in our official capacity as volunteer public servants. And we recognize the severity of the problems confronting the PDA right now,” Tonina said.

“We also feel that we owe it to the public and all those impacted by this current situation to do what we can to remedy what has happened and move forward to secure the longterm viability of the fort for the community at large,” he said. 

Tonina said state auditors will provide the board with an independent, thorough and transparent report that will be made public.

“Moving forward we and others need the facts so we can all understand from an independent source how this happened,” Tonina said. “That process is underway and we are working hard to partner with the state auditors and do what we can to expedite the audit.”

He also asked for the public’s patience, and vowed that the PDA will take the steps needed to preserve the fort’s future.

“Steps will have to be taken by us and David Timmons to ensure that this never happens again,” Tonina said.

“This is a critical time for the fort and we ask all concerned to allow the State Auditor’s Office to present their findings,” he added. “We commit to cooperate fully with any and all actions necessary to secure the future of the fort.”

Board Co-Chair Todd Hutton said it would take the fort and the community working together “to solve this enormous problem.”

“That old trite saying, ‘It takes a village,’” Hutton said. “In this case, it does take a village to address this.”

One line of credit from Kitsap Bank — $1.5 million for the Makers Square project — comes due in December. A second line of credit that was extended to the PDA —
$2 million for Fort Worden’s “glamping” project — is due during the first quarter of 2021.

Also adding to the fort’s financial woes: a loan taken out to pay for energy efficiency projects must also be refinanced.

At last week’s meeting, Timmons again noted that the reopening plan for the fort following the COVID shutdown was unsustainable; the PDA has a $250,000 deficit, which is growing by the month. 

Timmons has been looking for financial help in the past month, beyond getting a new financing arrangement with Kitsap Bank.

According to Timmons, Kitsap Bank is willing to defer payments due on the PDA’s line of credit.

Timmons has asked the city of Port Townsend to provide loan security for a $900,000 loan that the PDA would borrow to restore $400,000 in funds that were diverted to operations, and $500,000 to replace a grant that was not funded, according to a Nov. 22 email to Port Townsend Mayor Michelle Sandoval and City Manager John Mauro.

In the email, Timmons also said he had reached out to Centrum for assistance, but Centrum denied his initial request but was working on an alternative.

“I can’t disclose it quite yet since we only had one conversation and there is a need to follow up,” Timmons said in the email.

“But it offers a way forward for all of us and it looks very promising to me,” Timmons added in the email. “If we can lock an agreement into place in the next two weeks that would give everyone a perfect solution. But as you know, stuff happens and I need a backup plan. I am still looking at other options but we are running out of time.”

COUNTY GRANT EYED

Earlier, Timmons submitted a request to the county to repurpose a Public Infrastructure Fund grant for $150,000 that had originally been awarded to pay for employee housing at Fort Worden.

Timmons had hoped to use the grant to hire an outside consulting firm to create a new business model for the PDA.

The request found little support at last week’s meeting of the Public Infrastructure Fund Board.

“This is a real opportunity for us to move forward,” Timmons told the board. “The fort itself is too vital of a community asset and too important from an economic development perspective.”

The plan would be focused on the mechanics of making the PDA more resilient, Timmons said, “so that we don’t have this kind of economic collapse in the future repeat itself.”

“The vision is going to stay the same for Fort Worden. What we’re looking at is changing the structural arrangement and the management model of it to be much more sustainable and viable,” he explained.

County Administrator Philip Morley said the PDA’s proposal didn’t appear to comply with the county code and the definition of projects that are eligible for grants.

“Where we hit the shoals, I think, of compliance is on the definition of project,” Morley said.

The problem could be avoided, officials noted, if the grant was instead awarded to Jefferson County’s economic development council, with that organization guiding work on the business plan.

After other board members raised concerns about funding being used on a business plan, and not an infrastructure project, Timmons said he would come back with a revised proposal after talking with the economic development council.

Comments

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HarveyW Colatteral Damage

Anyone having taken out a construction loan knows that the funds are held by the bank, and the borrower needs to show receipts to draw from the loan amount held by the bank. That safeguards misappropriation of loan money for different uses. There is no understanding for me of how money for capital improvements were diverted. Was only one person responsible? The State, Kitsap Bank, and of course the FWPDA share some responsibility for letting loan money be diverted. The State year after year found accounting methods to be questionable. No fixes were implemented by those now saying they will do better and who promised fixes in the past. A few months ago the Leader had a story about the State focusing of below normal rents at the campus. The FWPDA and "partners" are the campus. We succeeded in keeping the campground in State hands in 2012.

Around 2012 I spoke at a meeting warning of what happened to the Pike Place Market PDA that used magic tax credits that backfired costing millions to taxpayers. I was assured by less than friendly folks with the FWPDA that they knew better. They didn't. The chair was owner of a business at the Fort that didn't, as all didn't, follow the original State/Centrum Memorandum of Understanding. Businesses open to public visits as part of the park experience. It didn't matter. Done deal before anyone knew about the FWPDA. The State is far from blameless.

Magic grants etc to fund projects is one way. Not the only way. Now we see not the way at all. Especially with money spent on the glamping project with tents costing in the neighborhood of $160k that would be useless in 10 years. Just one example.

The middlemen/women profiting need a complex magic money system for them to be needed to navigate the magic free money world. As the deleted Leader comments from 2 stories in 2012 show, there are and were good ideas locally for the campus. Housing was eliminated from the FWPDA Charter. The information is so good it had to be deleted. Watch here for the deleted comments, 70 or so that I will paste here soon.

If you care about the Campus and understand that those comments are the reason Title to the entire Fort including the campground is not in local special interest hands, read them. Way too much here to comment on specifically. It is like a 4 year old with cake all over their face saying the dog ate the cake. Covid did not eat the cake either. The dog is the FWPDA and those mismanaging it, and what once belonged to all of the people of the State of Washington, part of a historic State Park. Many saw this coming. Now Timmons wants $150k to have a study to tell the FWPDA how not to be so myopic. Does anyone see a pattern? Reset and do again with the same flawed folks.

"Partners' underpaying rent as the State established months ago during another failed audit, are part of the overall money problems. The Leader even covered that.

Dismantle the FWPDA, it has done enough damage in the name of special interests and well paid staff. Prosecute criminal behavior. Watch for a whole lot of voices from 2012 here that had better ideas and knew where the path chosen led.

harvey@forestgems.com will get you word docs of the articles and comments not censored. Or, watch here. Its a lot of comments from folks who tried to avoid this mess. What is David Robeson's retirement amount for running this into the ditch? How much was he paid over the years to build this house of cards?

How much is Timmons who left the City in debt 17 million with failing roads paid. Someone study that.

Friday, December 4, 2020
Jüsteks Hale

"Never spend your money before you have it."

~Thomas Jefferson

Harvey, it's nice to see a well-written, level-headed and carefully composed comment from you. More of this, please!

(PS- "Colateral". One "t".)

Saturday, December 5, 2020
HarveyW Collateral Damage

Mr Exhale et al. The glaring thing that stands out is $150,000 for some outside consulting firm the FWPDA will choose to advise those setting the course for years, we are up to our necks in debt for, to tell them what to focus on. Since when did Timmons follow any expensive studies he had taxpayers pay for regarding parking. It has always been pretty simple. Follow laws and codes, or change them and signage. Listen to public input when problems arise. 5 plus years of photo and text documentation supported by individual police officers I speak with is ignored. It is all related Just Exhale. Timmons is the center piece of problems in budgeting in the City, overstepping his job description according to many, now he is "the guy" at Fort Worden. Formula is......do what you want, people don't pay attention. If they do commission expensive studies you will ignore, and be able to, because the public's attention span is limited. If needed, rinse and repeat.

The FWPDA is an extension of the City of Port Townsend. The City of Port Townsend via the FWPDA charter is in total control of the FWPDA. The No Term Limit Council has powers to oversee the FWPDA. God help us. They can't handle simple parking or any plan. Just studies.

Put someone not so tainted in the hot seat at the FWPDA. Someone who actually has the greater good of this monument and all of the people at heart. Timmons outside his bubble is known for being a very poor city manager. Debt, roads, parking, disregarding public input, documented broken promises, much more. Now at Fort Worden. Just the Campus. The park stayed in State hands. No problems there.

Hey exhale, here is how it works. We are both incorrect in the spelling of Collateral. Me too many T's and you not enough L's. I changed it. God save us we worked together. I do see similar concerns voiced differently by us both. You know who I am. You.......

The root cause of so many things is those in the bubble. Pop the bubble. Wake the people. Lets spend the money, or far less than $150,000 that outside studies would hand another thing to ignore to the FWPDA, and look at the predictive comments concerned citizens had, and plot a course today with current thoughtful input from diverse folks with lessons learned. Life Long Learning. Or denial?

Disband the FWPDA and all it represents, special interests. A new form of management is obviously needed. I favor veteran participation and some use for affordable housing the Charter was re written to exclude.

Timmons and consultants and studies will end like parking in PT. And the budget deficit. And more. If it is broke change it. No hurried BS like last time the public was scammed and a few made money with reduced rents and big paychecks to administrate this sinking ship. Links to educational comments deleted from the 2 2012 FWPDA Leader stories later today if I can get software issues resolved.

Saturday, December 5, 2020
Jüsteks Hale

COLLATERAL

Well, at least we can figure out how to spell a word correctly, as a community. Perhaps there is hope, after all.

So, two questions:

How can we, as a community, bring Ft Worden back to being a PUBLIC park, MANAGED BY THE STATE?

How can we, as a community, hold David Timmons accountable for all the financial damage he has done to this community? He seems to suffer no consequences whatsoever, for trainwreck after trainwreck caused by his absolute arrogance and pathological dereliction of duties as a PUBLIC SERVANT.

My husband and I owe you an apology. We are grown people who have participated in angry mudslinging and childish behavior. Clearly, we have problems in this city which will never be solved by partisanship and honk-parades. Thank you for your service to our community. We apologize for our rude behavior, here.

"Hale and Fare Well",

Jüsteks & Nathaniel Hale

Saturday, December 5, 2020
HarveyW Collateral Damage

Here are the links to 2 2012 Leader stories regarding Fort Worden. The first regarding reactions to the FWPDA wanting to have full title to all of Fort Worden.

https://www.ptleader.com/stories/fort-worden-forum-draws-a-crowd-full-of-questions,49740

The second story now with restored comments regarding the lack of FWPDA planning and questionable staffing.

https://www.ptleader.com/stories/frustration-at-fort-worden-forum-where-are-the-details,49449

Happy reading and start from the bottom on comments to see them in chronological order.

How to take back what belongs to all? Knowing the history of how the FWPDA came to be and how it took over is a first step. Dealing with Timmons? Getting him out of influence at the FWPDA is a good start. Pop the bubble.

Saturday, December 5, 2020
Dennis Canty

The transfer of $1.3 million in capital funds for Makers Square and the glamping project to operating expenses for the PDA is certainly unethical and potentially illegal. The Board has a critical fiduciary responsibility and their apparent surprise about the transfer suggests a lack of financial control at the institution. There is not a single quote from the PDA staff or Board that suggests that anyone is taking responsibility for this crisis. The PDA is a public entity and must be managed to a higher standard of transparency and accountability than the typical hospitality business. Are the staff and Board capable of this?

Sunday, December 6, 2020
Mike Galmukoff

More up darted info here that you'll not receive from, "The Leader"

https://www.porttownsendfreepress.com/2020/12/12/fort-worden-pda-out-of-money-must-privatize-to-survive/

Saturday, December 12, 2020