Port of Everett eyeing former K-C mill site for shipyard

By Michael Whitney, June 3, 2015, Snohomish County Tribune

The Port of Everett has been doing due diligence work to acquire the former Kimberly-Clark mill site almost ever since shipyard company Foss Maritime backed out of a purchase-and-sale agreement a year ago.

The port’s intent is to resurrect the effort to have Foss put a big shipyard on Everett’s waterfront at the former mill site. The port apparently began its work mere days after the Foss deal fell through.

No formal paperwork to buy the site has been signed, port spokeswoman Lisa Lefeber said.

But how the port arrangement would be structured would have the port acquire the site and then lease it to Foss, the port’s Lefeber and Foss’ contracted spokeswoman Megan Aukema both told the Tribune on Friday, May 29.

Port officials have been discussing the issue behind closed doors for the past 12 months, Lefeber said.

There is no timeline for making an offer, Lefeber said, but the port sees Foss as an opportunity for a stronger, larger port.

“We hope and expect this would complement the maritime assets of the port,” Lefeber said.

In addition to Foss bringing approximately 250 jobs, the site also could open up space for cargo. The port is at-capacity for cargo storage, Lefeber noted.

The Kimberly-Clark site is adjacent directly north to the port. While the mill site is marketed as being a deepwater port, the water here is shallower than where the port is located.

The 66-acre site is for sale at a listed price of $38 million, according to the website of the commercial real estate brokerage handling the deal, Seattle-based Kidder Matthews.

Kimberly-Clark spokesman Bob Brand could not comment if anyone is negotiating to buy the site.

The port is a public taxing district, but Lefeber emphasized that tax revenues are a small part of the port’s budget picture.

“We’re really run like a business,” Lefeber said.

Only $4 million of the port’s $70 million in operating revenue comes from taxes; the rest comes from business activity at the port, Lefeber said.

Even so, the port could have ample resources to float a long-term bond, acting like a mortgage, that is backed by its steady flow of tax dollars to seal the K-C site purchase. The port has not come to a conclusion whether to do this.

The port’s been using its tax revenue recently toward environmental cleanup work, Lefeber said.

When the Kimberly-Clark site was put on the market in 2012, the port was firm that it wasn’t interested in making an offer. When Foss’ purchase-and-sale agreement fell through, the interest changed at the port’s offices.

The deal between Kimberly-Clark and Foss, whose parent is Saltchuk Resources, fell apart in May 2014. The breakdown boiled down in part to who would be on the hook to clean the contaminated soil left by Kimberly-Clark’s mill operations, according to a joint press release at the time.

Another disagreement was over concerns about the seismic condition of the site, the Herald reported last year. The companies couldn’t agree on who would take care of a connected set of dug-in building pilings that, in an earthquake, could intensify shaking because of how they are connected together.

Foss wants to relocate to Everett so it can expand. It has a shipyard in the Ballard Locks that it is outgrowing.

While Foss also began leasing the Port of Seattle’s Terminal 5 in January as a place to serve Shell’s arctic drilling fleet — the site of recent protests — leasing the Seattle site has no correlation to the company’s continued interest in Everett, Foss spokeswoman Aukema said.

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