Port Gives Away Our Bellingham Waterfront

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Wed, Apr 01, 2015, 12:20 am  //  John Servais

Port commissioners, from left, Jim Jorgesen, Dan Robbins and Mike McAuley. Port director Rob Fix on far left.

I went to the Port of Bellingham meeting this afternoon at 3 p.m. to learn first hand about the contract the port was about to sign.  And moment by moment learned just how bad our port still is.  It reminded me of the KAP scandal of 1991 when the port signed with KAP Development and was fleeced for a few million dollars.  Surrounding that was secrecy, lies and stone walling of the public - just like today’s process.

So - what is happening that has so many of us political watchers upset?  Well, this 200 page contract was only made public five days ago and the port intended to simply have a signing ceremony this afternoon.  When asked to have a public hearing they said no, insisting they did not need to.  When reminded that they were selling public land and it required a hearing, even then they tried to avoid any public process.

They agreed to allow a public comment session - not a legal hearing - to hopefully abide by state law.  And so today’s two sessions.  They still probably did not fulfill the state legal requirements.  But to undo that will take a lawsuit.

This evening the port authorized signing a contract, selling for peanuts a large portion of our waterfront to a hollow corporation that was formed just 6 days ago: Harcourt Bellingham LLC.  Signing with such a shell company is a strong clue that we are dealing with shysters.   So it was 25 years ago with the KAP agreements - where the port signed long term leases with empty corporations that did not really exist and later lost millions of taxpayer dollars.

The paralles with the KAP debacle are present.  Even the port attorney is the same.  Frank Chmelik advised the port through the KAP deals and is now guiding the port through the Harcourt sellout.  After the KAP scandal, none of the three port commissioner were reelected - one port staff person was fired and the executive director soon found another job and left.  After that the port fired three staff members in their search for the person who was leaking information to me.  They missed and my two sources remained employed - but after the third firing I quit monitoring the port as it was sickening to see good people losing their jobs because of me.  More so because they had never provided any information to me.

Back to today.  Citizens have not had a chance to review this contract and there are many questions and concerns about it.  Even the commissioners did not understand the contract as was evidenced by Chmelik interrupting them several times to correct their explanations to the public.  Yep, the commissioners did not know what they were signing.  Even so, commissioner Mike McAuley had the gall to tell the public that they did not have to run their agreements past citizens.  Yes, port commissioners have been like that for decades.  

Many specifics are shocking.  Here is one.  The land is being sold for $20 a square foot - probably less than your residential property is valued and taxed.  (My residential lot with no view is valued at $29/sq ft.)  It is a sellout of our valuable waterfront to a foreign developer who has set up a shell company to buy it.   

Chmelik spent time trying to explain the weird sale process - just as he tried for the KAP properties 25 years ago.  As with the KAP explanations, this involves big money for the port.  What can go wrong? Well, Harcourt can do leases to other shell companies - and leave the port hanging for the entire amount.  The port has learned nothing over the years.  Someone in the audience even asked about KAP and Chmelik replied, “Well not precisely like KAP did, and that was a long time ago.”  So he knows.  And so do I.  The port is being taken to the cleaners. 

What can we do?  Nothing.  We elected these guys.  They voted and signed the authorization this evening.  The deal is done.  The best 18 acres of our waterfront have been sold for peanuts to a shell company formed 6 days ago by unknown persons.  (see screenshot at bottom of article)

But we citizens can do something about the future.  We can expand the port commission from three to five commissioners - and bring more minds to these decisions.  No corporation has a  board of three directors - nor does any city council.  We eliminated the three member county commission in 1978 because of incompetence in managing our county.  It is time to expand the port commission to five commissioners and end the incompetence. For that is what it is.

I realize this description of the process is confusing. It is hard to explain how a scam works when you are watching it unfold.  Scams are by their very nature complex as that is how to fool naive elected officials.  Over the next couple weeks I will try to provide more explanation.  Plus more about KAP.

One last point.  In the end - at the end of the 5 hour meeting - the commissioners inadvertantly let slip why they signed.  They wanted to go forward and this was all they had.  They did not want to wait any longer.  Watch the last hour of the video for this and some amazing insults to citizens, corrections of commissioners by Chmelik and more.  Lets preserve this video for the future.  

The video of the meeting is linked below.  Here are a few noteworthy moments. For some fine comments by citizens, watch earlier portions of the video. If anyone wants to annotate when different citizens spoke, I would love to post that.  

4:14:50 - Mike McAuley lectures citizens on how ports do not accept citizen input

4:17:40 - Tim Jorgensen rebukes citizens for comments and picks an argument

4:42:30 - Chmelik tries to explain the convoluted sales terms - shades of KAP

Washington Secretary of State website - showing corporate formation 6 days ago of the shell company we sold our waterfront to.

Related Links:

-> Video of the 5 hour port meeting March 31, 2015
-> The Master Development Agreement for our waterfront
-> Port web page on the waterfront development

Port Gives Away Our Bellingham Waterfront

Wed, Apr 01, 2015, 12:20 am  //  John Servais

Port of Bellingham today sold out our public waterfront to a shell foreign company formed 6 days ago. Sold it cheap and with a screwy arrangement.


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