Port Orchard Officials to Meet with Kitsap Commissioners Monday

Correction 7/31: The City of Port Orchard invested $21.5 million to upgrade the Karcher Creek Sewer District (now Westsound Utility District) treatment plant in anticipation of providing sewer to SKIA. Of that amount $4.5 million, came directly from the city treasury, out of reserve funds. The balance was bonds — which the taxpayers will be paying off for the foreseeable future. “That’s why we’re working so hard to be at the (SKIA) table,” said PO Mayor Lary Coppola, who alerted me to my error.

Original post:

I’ve only been on this beat a year-and-a-half, but it seems like this meeting of the entire council and board is unprecedented. Here’s the brief:

The Port Orchard City Council will meet with the Kitsap County Board of Commissioners at 6 p.m. Monday at City Hall, 216 Prospect St., to discuss South Kitsap Industrial Area and other issues of mutual interest.
On the agenda is a proposed annexation of McCormick Woods into the City of Port Orchard and likely future annexation of properties along the Bethel Corridor into the city.
Time permitting, the group will also discuss Givens Center and Veteran’s Memorial Park, county facilities within city limits.
For more information, call (360) 876-4407

My questions:

On SKIA: The Port of Bremerton and the City of Bremerton are cooperating on a proposed annexation of SKIA into that city. Port Orchard is feeling left out, having made a more than $1 million $21.5 million investment in Karcher Creek Sewer District’s (now Westsound Utility District) treatment plant some years ago. According to a 2003 memorandum of understanding between PO and the port, PO would be the jurisdiction to provide sewer, hence the upgrade. Bremerton recently completed a study saying, in part, that it could provide sewer to SKIA, so PO is no longer the only logical entity to do so. Where do county officials, especially SK Commish Jan Angel, stand on the proposed annexation?

On McWoods: The city, the county and McCormick Land Company have been hashing out details of the proposed annexation, picking apart development agreements between the county and the land company that were made years ago. What would be PO’s liabilities for providing infrastructure and services under the agreements? Where does the city stand to benefit? How will the county deal with loss of revenue if the annexation goes through? This could be a dress rehearsal for a Silverdale annexation.

On Bethel: Bethel Corridor is slated for a major upgrade that taxpayers will likely be asked to help pay for. Same question. What are the financial liabilities the city would take on? How would that be balanced out by increased revenue?

What are your questions?

4 thoughts on “Port Orchard Officials to Meet with Kitsap Commissioners Monday

  1. If Port Orchard will not enter into a legal binding agreement not to annex the Bethel Corrider for 20 years after project completion then the project should not procede with county money period.

  2. Feb. 18, 2003, the county commissioners and city council held a joint meeting at the city hall in Port Orchard to discuss the Urban Growth Area planning process. It was, surprisingly, a fairly interesting discussion. Maybe this next one will be too.

    If the Bethel Corridor project is going to happen, I believe it needs substantial funding from existing tax revenue — including both the county road fund property tax levy and the county’s share of motor vehicle fuel taxes. Trying to raise 59 percent of the cost from new taxes seems like a really steep hill to climb. (The other 41 percent would be paid by assessments on property within a County Road Improvement District encompassing the adjacent property that specially benefits from the project.)

    For the county to put its revenue into the project, as it has for the Waaga Way extension for example, the City of Port Orchard has to come to some compromise with the county about the effect of annexation. If the city annexes the “corridor” after the project is done, the county will lose the county road fund levy revenue from that property as well as the sales tax revenue. The county would be left with bond debts to be paid from the county road fund, but the road fund would no longer receive tax revenue from the annexed property that benefited from the road fund expenditures.

    So, what does the city have in mind? Do they simply want to throw out the plan developed by the county for that corridor and let development occur whenever and however it will? Do they have no inclination to work together with the county — which would require sharing the revenue after annexation?

  3. The most recent Comprehensive Annual Financial Report for the City of Port Orchard on the State Auditor’s web site is for 2006. On page 45, it describes the sewer treatment plant expansion. It doesn’t say where the funds come from to pay the bonds, but I suspect they come from the sewer district’s customers. If so, there are more dogs in the fight than I had thought.

    Here is the text on page 45 about the “Joint Venture” between the city and sewer district:

    “In 2002, the Wastewater Treatment Facility began expansion plans. The cost of this expansion is now approximately $21.52 million with completion anticipated in 2007. The project was approved for a $10 million Public Works Trust Fund Loan in 2002 and another 6.8 million in 2003. Both loans are issued on behalf of the Joint Venture in the City of Port Orchard’s name. Payment on debt is made by the Joint Venture; therefore the loan is not disclosed as a liability of the City. The draw down on the loans began in 2004 and as of December 31, 2006, the City has drawn $15,960,000.00. At the end of 2006, $21,374,858 had been spent on the project, and the total project was approximately 95% physically complete. The construction contract was complete. The City and Karcher Creek Sewer District will share in the excess expenditures.

    “The City of Port Orchard is the lead agent in the construction project. The City, as Treasurer of the project, holds the resources for the expansion in an agency fund. At the completion, the agency fund will be closed to the Joint Venture.”

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