Harbor readies for brighter economic outlook

• After Sen. Begich visit, Homer’s Harbor needs might get more attention
By Naomi Klouda
Homer Tribune

HOMER TRIBUNE/File photo - The Homer Port and Harbor has grown incrementally every year since it was constructed. The port is home to a diverse user group of charter captains, commercial fishermen, tankers on break and even a jack up rig, for now.

HOMER TRIBUNE/File photo - The Homer Port and Harbor has grown incrementally every year since it was constructed. The port is home to a diverse user group of charter captains, commercial fishermen, tankers on break and even a jack up rig, for now.

Ports around Alaska depict the economy of a region that allows for judgment calls: The more successful ones tend to grow bigger. They run out of space for ships and boats, stacking them up three and four deep when dock space is scarce.
Or, they run the opposite course, great gaping spaces that show a want for commerce and lack of interest on the part of commercial fishermen or freighters or fishing anglers.
Homer’s Port and Harbor wants to grow.
“We’re already beyond capacity,” said Homer Harbormaster Bryan Hawkins, a litany he’s said for several years now. “We’re running three and four deep tied to the dock, and when it’s the big vessels, the dock gets worn out. It wasn’t built for that.”
The giant crabbers and freighters, when not working, sit abreast two, three and four deep. Crews hop from deck to deck to get to the dock.
But thanks to new interest in expansions and harbor projects, good news may be close at hand.
Soon, the City of Homer will bond for about $4 million to match with another $4.2 million Gov. Sean Parnell has designated for Homer from the total Port and Harbor Grant package allocation of $14 million statewide. Next, it’s up to the Alaska Legislature to approve the governor’s request.
It was a big deal when Homer’s port ranked No. 1 in statewide priorities, Hawkins said.
“In June last year when proposals were submitted from around the state, a panel meets and reviews, rates, grades and ranks them,” he said. “Homer received the No. 1 ranking of all harbor grant appropriations in the state.”
City Manager Walt Wrede said though this makes for a successful appropriation, it means that the administration must wait until the legislative session ends, after April 15, to make sure the appropriation stays put in the budgeting process.
“We’re trying to time it so the closing on the bonds would be around the time when the Legislature makes the decision. Sometime in April, we would be good to go,” he said.
The money raised to pay back the revenue bond will come from the adjusted fees at the harbor that went into place last year. Moorage was raised 15 percent, as was the cost for certain services such as ice per ton which went from $124.95 to $130.90. But the biggest change came at the Deep Water Dock, where the jack-up rig Endeavour has spent the past five months. Vessels from 776 to 800 feet long used to pay $4,668. This rose to $7,459 in the new fees applied now.

How Endeavour helps the bond
Back when the changes were approved, having a drilling rig moored at the dock wasn’t on anyone’s mind. The idea was this: the total additional revenues to be generated from local users would be around $496,590. The bond payments are estimated to be $327,672 per year and the money generated over the amount needed for the payments would get socked away for rainy days in the Port and Harbor Reserve bank account.
“The new moorage rate applied to the Endeavour, and that will help pay off the bonds,” Wrede said. “Any of these fees go into reserve accounts and the bond bank takes that into account. They will look at our financial health and how much are in reserves and are we a good risk. Do we have an ability to pay back what we borrow.”
Just moorage fees go into that pot. Buccaneer Alaska Energy also pays other fees, direct or indirect.
Buccaneer will receive a tax assessment on its jack-up rig in March. The state assesses it for value, decides how much it’s worth and then levies a tax. The borough and Homer split the tax in a formula, Wrede said. Those taxes will then go into the town’s general fund, for use on expenditures like the Boys and Girls Club or to hire a new police officer.
Yet another way the city benefits is from the purchase of parts, materials and services that are charged the city’s 4.5 percent sales tax. That money also goes into the general fund pot.
Back to the harbor, whatever is stashed away in the reserve account goes to improving problem areas of the harbor – its aging infrastructure and lack of ability to expand has kept harbormasters worried. Harbors used to be maintained by the state, but in a TORA decided in 1999, harbors were handed over to cities.
“It was one of those situations where, ‘well, thanks, but’ and a comma,” Hawkins said. Cities were handed over harbors that needed help, but the funding wasn’t necessarily at hand to do the work. Wooden ramps rotted in planking, dock planks required repairs, a boat launch saw increasingly chipped cement.
The state then set up the annual Harbor Grant Program to give municipalities money for repairs. That’s where the governor’s $4.2 million sits now, in the grant program. It is limited to only existing infrastructure. “You can’t use it for expansions,” Hawkins said.

Harbor building, finally maybe
Meanwhile, the Harbormaster Office also has gotten a lot of scrutiny, if not a few cringes. The building is hobbled together from past structures. “Our operations room used to be a public restroom,” Hawkins points out. It was put together in the mid 1980s, but who knows how old some of the pieces were.
The Homer City Council ranked that building No. 1 in its priority for funding through the Alaska Capital Budget. Homer City Lobbyist Linda Anderson has it in her sight as does Rep. Paul Seaton and Sen. Peter Micciche.
The Port and Harbor Advisory Commission came up with a recommendation that is part of the City Council packet this week. It details the three options for that building: tear it down. Move to another building. Build a new one. The commission recommended building a new one.
“At this point, that’s just a recommendation. There’s no money for it,” Wrede said.
The new building, conceived by Nelson Engineering, would be located on the opposite side of the harbor, over by Ramp 7 and not far from the Coast Guard office on that side.
“The reasoning is that it would then be more central for when the East Harbor is built,” Hawkins said.
The idea is to, if not plan for growth to at least anticipate which direction it might come from. There’s also no money in sight for the East Harbor expansion, jutting out into Mud Bay on the leeward side.
That money would have to come from a federal appropriation, at a time of dire straights in the federal budget.
“We’re working on it with our Congressional delegation,” Hawkins said, not sounding optimistic. “The state would help. The reserve account would help. I will be the third port director to have worked on it and I hope it can happen in my lifetime.”
Justification for the port expansion goes back to the three-and-four deep boats problem. Federal projects have to pass a commerce test proving, in this case, it’s a harbor that not only wants to grow, but will bring lasting commercial health to a community. Hawkins believes this one-time little harbor, forged by men desperate to have safe moorage back in 1960, has proven its muster.
“It’s the wave of history that harbors grew first because they needed to transfer goods from ships to land. All the services that are needed grew from there,” Hawkins said.
Homer was a village (in 1960) and in building a harbor, the pioneering folks at the end of the road were building a town.
“It works together hand in glove and the result is a more diverse, more healthy economy.”

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Posted by on Feb 13th, 2013 and filed under Headline News. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.

3 Responses for “Harbor readies for brighter economic outlook”

  1. seascout says:

    What bothers me most about this harbor is that I pay $13 to launch my boat on a ramp that is rougher than a washboard dirt road. Then I have to go find a parking spot in a mud pit parking lot which is filled up by compact cars occupying trailer parking. Would it be too much to ask from Hawkins to designate a parking area for cars only so that they don’t take up valuable trailer parking? One more thing that annoys me…..Mr. Hawkins lives 12 miles out of town and drives a city owned vehicle home everynight. Is that morally correct to be footing his fuel bill all year? Just a thought for a tax payer.

  2. worried about invaders says:

    “It was a big deal when Homer’s port ranked No. 1 in statewide priorities”

    Parnell has big plans for Homer. Reduce the volume of gas from the north slope to increase demand, then make the natural gas in the Cook Inlet/Homer area a priority… is Homer in unnamed port below?

    Bill Walker(general counsel for the Alaska Gasline Port Authority)”Gas line posturing”

    Gov. Sean Parnell appears to be supporting two competing yet conceptually incompatible concepts. This includes the low-volume bullet line sponsored by a state agency, the Alaska Gasline Development Corp. As currently configured, it would be a state-subsidized, 36-inch, low-pressure project that can transport a maximum of 1.6 billion cubic feet per day and cannot ship natural gas liquids due to the cheaper but thin steel selected for the pipeline. This project will take 10 years to build. The Legislature is being asked to fund a total of approximately $400 million in engineering and permitting efforts on that project.

    The other proposal is a producer pipeline, nominally proposed under the Palin-era Alaska Gasline Inducement Act framework, to an unnamed Southcentral Alaska port that is presumably either a location on Cook Inlet or near Valdez.

  3. foreign_observer says:

    Mr. Hawkins is ‘on call’ 24/7 to the “taxpayers”. The actual salary he receives is not adequate to cover that kind of responsibility. I believe all “Dept. Heads” enjoy this same perk. IMO, the Port is the lifeblood of Homer. Without it, why would anyone live here? I guess you could launch off the beach in AP, if you don’t like the facilities in Homer.

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