10A
THE DAILY ASTORIAN • THURSDAY, FEBRUARY 19, 2015
Enterprise: Program could cost state more than $75 million
Continued from Page 1A
Businesses must maintain
employment levels and com-
ply with other conditions in
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“This isn’t just recruit-
ment,” said Warrenton City
Commissioner Henry Bal-
ensifer. “This is encouraging
people to buy new, to build
up, to renovate.”
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burned down two years ago
in Warrenton, or lure inves-
tors to distressed areas such as
North Tongue Point.
“I think we’re looking at
it as kind of a strategic tool
to enhance business devel-
opment opportunities in our
county and on Port proper-
ty,” said Michael Weston, the
Port’s director of business de-
velopment and operations.
Astoria Mayor Arline
LaMear and City Councilor
Cindy Price, who was initially
critical of an enterprise zone,
both said this week that the
city might look more positive-
ly toward a collaboration.
“So it could be very help-
ful and it might be a good tool
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after doing more research on A portion of the proposed Clatsop Enterprise Zone.
the concept.
Policy tools
Enterprise zones have long
been policy tools of the fed-
eral and state governments
to attract business investment
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ticularly in economically dis-
tressed regions of the country.
In Oregon, there are 66
enterprise zones, according
to the Oregon Business De-
velopment Department, 53 in
rural areas and 13 in urban
centers.
The enterprise zone pro-
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state more than $75 million
from 2013 to 2015, accord-
ing to Oregon Department of
Revenue projections.
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results for enterprise zones
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into measurable economic
gains and job growth.
A 2009 report by the State
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Courtesy Clatsop County GIS Specialist Alejandro Bancke
Other researchers have
also documented the relative-
ly high cost per job created in
enterprise zones, questioned
whether businesses would not
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breaks, and criticized the lack
of data to accurately measure
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ments.
Uneven record
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businesses that appear to have
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The North Coast Business Park is in the foreground of WKH WD[ LQFHQWLYHV KDYH DOVR
this photo taken soon after Costco was finished.
blemished the enterprise zone
program.
found that, in a short-term and other metrics did not
The Oregonian reported
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this week, for instance, that
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Governments, the report several out-of-state compa-
enterprise zones had larger found, have to wait seven nies with data centers in Hill-
employment and payroll gains years on average to recov- VERURKDYHHQMR\HGWD[EUHDNV
than in comparison areas.
er the undiscounted value of but have had an uneven record
Over the long term, pov- WKH SURSHUW\ WD[ H[HPSWLRQV of job creation. The newspa-
erty and unemployment rates The report also found that the SHU IRXQG WKDW D IHZ ¿UPV
declined more in enterprise FRVWRISURSHUW\WD[EUHDNVIRU accounted for most of the
zones than in comparison ar- every new full-time job was QHZ MREV 2QH ¿UP UHFHLYHG
eas, but household income about $11,200 on average.
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listed just one full-time job.
Some in Clatsop County
have a sour impression of en-
terprise zones because of the
history with the Georgia-Pa-
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for a new paper machine
through the Lower Columbia
Maritime Enterprise Zone,
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meeting minimum employ-
ment requirements, and then
contested the mill’s proper-
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reached a $2.5 million set-
tlement with Clatsop County
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2012.
Others counter it is un-
fair to judge enterprise zones
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solely through the prism of
job creation, which does not
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EXVLQHVVH[SDQVLRQ
&KXFN'DXJKWU\WKHH[HF
utive director of the Colum-
bia County Economic Team,
who oversees the county’s
enterprise zones, believes the
program has helped the coun-
ty compete with Washing-
ton state and other rivals for
business development.
“I guess there could be ar-
guments as to whether or not
the incentive actually is the
thing that tips the business to
make the investment, but it
certainly makes us very com-
petitive,” he said.
If a new Clatsop Enter-
prise Zone is approved by
the state, Balensifer said
Warrenton and the other
jurisdictions involved will
have to creatively market
the region and seek business
opportunities beyond simply
DGYHUWLVLQJ WKH SRWHQWLDO WD[
incentives.
“Mark my words on this:
if we say, ‘Here’s an enter-
prise zone, now come and
visit us.’ This will fail,” he
warned. “It will be a waste.”
Smithart: Inn had recently been listed for sale at $1.2 million
Continued from Page 1A
in July, did not make himself
available for an interview.
He has leased the Astoria
Riverwalk Inn, a former Red
Lion Inn, from the Port since
March 2012. He pays the Port
$10,000 a month in rent May
through October; $5,000
in monthly rent November
through April; and 10 percent
of his gross revenues.
“There’s also no valid rea-
son why he hasn’t supplied
the revenue reports like he’s
supposed to each month,”
Grey said, adding that Smi-
thart had owed the Port his
revenue reports dating back
to March or April, before
bringing them in Friday. The
Port is now poring over them
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much he owes.
Grey and Knight said
Smithart has provided vague
reasons for falling behind,
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lack of time.
“We’re hoping to come
to an amicable solution real-
ly fast, to protect the Port’s
interest,” said Knight, add-
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hotel.
Interest in hotel
Smithart had recently list-
ed the Astoria Riverwalk Inn
for sale at $1.2 million. After
comments from former Port
Commissioner Jack Bland
that Smithart was looking to
sell the hotel, Smithart said
he was looking for investors
in the hotel and had no inten-
tion of leaving.
Ganesh Sonpatki, who
owns several budget hotels
in the Portland area, told the
Port in October he was in-
terested in buying Smithart
out of the hotel, developing
it into a budget lodging and
possibly restarting the for-
mer Seafare Restaurant &
Lounge, located between
the hotel and the Chinook
Building above the West End
Mooring Basin.
Knight said the Port has
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offers to operate the hotel
while Smithart still has an
active lease. A representative
from the Astoria Riverwalk
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sions to avoid eviction, he
said. But the Port denied his
request, Knight said, because
of Smithart’s history of fall-
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obligations.
History
The Port Commission in
March 2012 sided with Smi-
thart and partner Seth Davis’
proposal to reopen the hotel
over a competing proposal by
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off Williams/Dame & Asso-
ciates, which wanted the Port
to tear the Red Lion down
before it would build a new
hotel. It gave Smithart and
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ning through most of 2017.
In October 2012, it voted
to give Hospitality Masters
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thart stated that his and Da-
vis’ intent was to be around
at least 30 to 40 years.
In August 2013, Smithart,
by that point alone in Hos-
pitality Masters, received an
eviction notice from the Port.
He narrowly avoided it after
falling behind on rent and
revenue-sharing, in addition
to being behind on transient
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In November 2013,
the Port Commission vot-
ed 3-2 to give Smithart a
$30,000-a-year break on
Port:µ:HDUHLQWKHEODFNIRUWKH¿UVWVL[PRQWKV¶
Continued from Page 1A
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statements, comparing the
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with what was adopted in the
Port’s 2014-15 budget at the
end of June.
“We are in the black for the
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erything that’s been going on,”
said Grey, referencing a net
income of $41,900 between
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cal year started, and the end of
2014.
Commissioners praised the
work of Grey and other ac-
countants brought in to help.
Each month, Grey said, the
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more and more, eventually
adding a cash position.
Jim Grey
Jim Knight
The reason the Port is in its
current situation, Kimball said,
is a worst-case scenario in
transitioning between accoun-
tants Browne and Grey with no
sharing of knowledge. There
were inadequate policies and
procedures in place, he added,
and a new accountant, Grey,
coming into a high-volume at-
mosphere with a high learning
curve.
He said CFO Selections
Auditing advice
is performing three tasks: re-
The Port is still trying to put viewing and adjusting the
together an audit for its 2013- Port’s accounting records
¿VFDO\HDUZKLFKZDVGXH between July 2013 and June
by Dec. 31, using accounting 2014 to ensure their accuracy;
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developing best practices and
On Tuesday, accountant policies through an upgraded
Todd Kimball of CFO Se- accounting system and pos-
lections detailed the Port’s sibly a property management
LVVXHV DQG ZKDW KLV ¿UP LV system; and helping the Port
doing to prepare them for implement changes.
their audit.
Commissioners praised the
Mike Weston
work of Grey, Kimball and
Barbara Blue of Bussert Law
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In other news:
• The Port Commission
unanimously agreed to amend
the lease of the Marine Spill
Response Corporation, which
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for space at the Walter E. Nel-
son building on Gateway Ave-
nue, across from the Port’s old
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• Clatsop County Manager
Scott Somers presented about
the Clatsop Enterprise Zone,
an effort to designate areas
where new business develop-
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WD[HV IRU WKUHH WR ¿YH \HDUV
Several Port properties pro-
posed for inclusion are the
central waterfront, East End
Mooring Basin, North Tongue
Point and the Astoria Regional
Airport. The Port will be giv-
en a resolution relating to the
enterprise zone at its March
3 meeting. Somers said the
application for the zone, for
which he’s been seeking sup-
port from the Port, Astoria and
Warrenton, is due April 10.
• Mike Weston, director of
business development and op-
erations, reported that the Port
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ple arriving on 18 cruise ships
this year, including eight in the
spring and 10 in the fall. The
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is scheduled to arrive April 30.
Find the full 2015 schedule at
http://bit.ly/1vk1EiF
• Weston reported that the
Port is now engineering por-
tion of a project to repave Run-
way 1131. The Port recently
received a $480,000 Connect
Oregon V grant to cover the 10
percent local match of a $4.5
million Federal Aviation Ad-
ministration grant the Port al-
ready received to pave 75,000
square feet. Engineering will
be complete by mid-April, said
Weston, followed by soliciting
bids for the project, which
would start June 30.
rent, lowering it to $5,000
a month in the winter
months, provided he in-
vest the saved rent into the
Port’s building and provide
it an accounting of the im-
provements. Grey said the
Port’s been shown evidence
of improvements, but not of
how much.
At the time of the lease
amendment, Smithart had
recently caught up after
falling as much as $40,000
behind on payments with
the Port in 2013. That same
month, he worked out a 30-
day repayment plan with the
city of Astoria, to which he
still owed about $48,000 in
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time.
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