Revenues would help pay for new Langley Marina

FREELAND — Port of South Whidbey commissioners voted unanimously on Monday to ask voters for their approval to triple the port’s tax rate so improvements can be made to the Langley Marina.

Port commissioners want a permanent hike to the port’s property tax levy, from 10 to 30 cents per $1,000 of assessed property value.

The measure will be sent to the county by May 27 for inclusion on the Aug. 19, 2008 primary ballot.

Commissioners said the 20-cent increase is needed to fund the port’s plans to expand the Langley Marina. The port will take over the property from the city of Langley in January 2009.

Port Commissioner Rolf Seitle said the public must be convinced that the tax increase is necessary.

“South Whidbey folks have been generous when they see the purpose and the need,” Seitle said.

“We think this is a good thing, but we must have a solid public relations effort. We can go to the well only once,” he said.

Seitle added that since the hospital district may decide to add a bond measure in November – a move that may not work in the port’s favor – commissioners prefer the Aug. 19 date.

Port commissioners have been reviewing a redevelopment plan for the marina for months now. The current plan would see the marina expanded at a cost of nearly $20 million; 110 boat slips would be added to the marina and the existing structure would be removed.

The first phase of the project, which would cost about $3 million, would add just seven slips to the 35-slip small boat harbor.

Port financial coordinator Dane Anderson estimated the levy increase will bring in an additional $900,000 annually.

For property owners, the property tax increase would mean an additional $70 on the annual bill for the owner of a $350,000 home.

Anderson provided three options to the board:

A bank loan to be re-paid by the current tax revenue of $455,000 a year;

A levy lid lift to triple the tax rate from 10 to 30 cents;

The creation of an industrial development district, which would raise property taxes for six years without a public vote.

The port plans to construct the marina over the next 10 years in two primary “phases.” Anderson presented three financial options for commissioners to consider, each closely tied to the timing of each phase.

Phase I would include seven new slips and marginal changes to the uplands area such as moving Phil Simon Park, more parking, new gravel roadways and a revamped boat ramp. The

400-foot breakwater would also be permanently moored for small cruise vessels.

Anderson said the port could cover the cost of Phase I at the current tax rate; the port would need to secure a 20-year construction loan with a 5 percent interest rate.

That option received a cool response from commissioners, however.

“Option one is not attractive to me,” Seitle said. “I don’t want to borrow money because I don’t want to burden taxpayers by paying interest on the loan.”

“And realistically, Phase I is not a money-maker for the port or South Whidbey,” he said.

But Port Commissioner Lynae Slinden was more concerned about timing.

“We need to get Phase I started, something we promised the city we’d expedite,” she said.

“I’m thinking the loan can be short term and tied into the larger amount we’ll need from a levy lift or [an industrial development district]. It would work if we have a temporary funding mechanism in place – the loan – and then pursue the levy option,” Slinden said.

Port Commissioner Geoff Tapert expressed qualms about a loan when the port doesn’t know how it could be paid back.

“We need to determine the ultimate funding process for Phase II,” he said.

Tapert said he prefers a permanent expansion of the port’s levy.

A simple majority of 50 percent is required for passage.

“Providing we can secure funding, we can seamlessly move into building the second phase,” Tapert said. “Going for a levy is my personal preference.”

Port manager Ed Field noted that passage of the levy in August 2009 would allow the money to build up in time for the start of construction in spring of 2010.

Tapert said that if the levy fails, voters should know the port can still create an industrial development district.

That option requires public hearings, but no public vote — commissioners can authorize a new tax of up to 45 cents per $1,000 of assessed value for six years.

Anderson noted that the port might not have constituent support for the proposal. Some on the South End have already complained about the proposal to create an industrial development district, and have warned it would create a grassroots effort to disband the port district.

Seitle said people have long known that taxpayer support will be needed to rebuild the marina.

“From the very beginning, people have known we’d eventually have to seek assistance from the voters,” Seitle said.

Commissioners expect to discuss marina plans at their next regular port meeting,

7:30 p.m. Wednesday, May 14 at the Freeland Library.