July 2023 Knowing The Waters: Port Documents; Required & Best Practice, by Frank Chmelik CSD Attorneys at Law

 This month we will take a look at what documents your port district should have on file and be keeping up to date.  Some documents are required by statute and others are good to have as a “best practice.”

Required By Statute

• Annual Operating Budget.  RCW 53.35.010 requires that prior to September 15th of each year each port commission shall prepare a “a preliminary budget of the port district for the ensuing calendar year showing the estimated expenditures and the anticipated available funds from which all expenditures are to be paid.”  This leads to the adoption of a final budget and filing with the “clerk of the county legislative authority a certified copy of the port district final budget” no later than the first Monday in December.  While the statute requires an “annual budget” some ports adopt a draft budget for the succeeding three or four years.  This “best practice” allows ports to look ahead, and it guides ports in strategic thinking.

• Comprehensive Scheme of Harbor Improvements.  RCW 53.20.010 provides that it shall be the duty of the port commission of any port district, before creating any improvements hereunder, to adopt a comprehensive scheme of harbor improvement in the port district.  The “best practice” is to review the comprehensive scheme at least once a year.

• Delegation of Powers Resolution.  Assuming a port commission wants to delegate any authority to a manager or executive director, RCW 53.12.270 requires the port commission to adopt a resolution.  The “best practice” is to ask the manager or executive director to review the “delegation of powers resolution” annually and suggest any changes to the commission.

• Resolution for Transaction of Port Commission Business.  RCW 53.12.245 requires each port commission to adopt, by resolution, “rules governing the transaction of its business.”  This resolution typically addresses such things as how motions are made and adopted, the form of the agenda, and commission expense reimbursement.  The “best practice” here is adopt rules that allow for the efficient transaction of the commissions business.

• Promotional Hosting Expenditures Policy.  Pursuant to RCW 53.36.120 if a port intends to utilize funds for promotional hosting (as authorized by Article VIII, section 8, of the state Constitution) the port must adopt an annual promotional hosting budget.  In addition, RCW 53.36.140 requires that the port commission adopt “in writing, rules and regulations governing promotional hosting expenditures by port employees or agents.”

• Annual Sale of Surplus Property Resolution.  Port commissions may, but are not required, to adopt an annual resolution providing authority to “the managing official of a port district to sell and convey port district property of ten thousand dollars or less in value.”  Without such an annual resolution the port commission has to approve any sale.

• Personal Service Contracts Policy.  A “personal service contract” is a services contract for something other than architects, engineers, landscape architects, land surveyors or attorneys and includes such things as IT consultants, marketing consultants or human resource consultants.  RCW 53.19.090 requires ports to “follow the policies adopted by the commission, which shall be based on guidelines developed pursuant to RCW 53.19.080.”

• Public Records Officer and Procedures.  RCW 42.56.580 requires the appointment of a public records officer.  RCW 42.56.040 and RCW 42.56.100 mandate each local agency (including ports) rules of procedure and other information related to public records. 

• Resolution By Which Competitive Bidding Requirements For Public Works Contracts May Be Waived.  RCW 53.12.270 requires a port commission to adopt a resolution addressing non-bid public works for things such as emergencies and sole source procurement.

• Appointment of an Agent for Tort Claims.  A tort claim is a claim for personal injury or property damage.  RCW 4.96.020 requires each local government to appoint an agent to receive any claim for damages. The identity of the agent and the address where he or she may be reached during normal business hours must be recorded with the county auditor.

• Appointing an Auditor Officer.  RCW 42.24.080 requires each port to appoint an “auditing officer” to authenticate and certify that the vouchers submitted for payment are a just debt of the port.

Best Practice Ideas

• Multi-Year Capital Budget and Financial Forecast.  There is no statutory requirement for a capital budget but generally it is a “best practice” to adopt a capital budget at least annually and a draft capital budget for the following several years.  This allows ports to foresee their capital needs and start to line up funding and permitting for needed projects.  Like a multiple year draft operating budget, it also guides a port’s strategic thinking.

• Strategic Plan.  I recently asked a port commission where they each were in 2014.  That was the last published strategic plan for that port and experience shows many are older.  I recognize that strategic plans are hard to do but it is a necessary roadmap for the port.  Consider revisiting the strategic plan each year to verify the direction the port will take for the next year.

• Financial Guidelines for Various Port Operations.  Here again a “best practice” is to develop the financial “curb lines” for port businesses.  For example, is there an agreed range of rate of return for port leases or is there a formula to determine moorage rates?

• Moorage Facility Rules.  While not mandatory, RCW 53.08.320 allows ports to adopt “all rules necessary for rental and use of moorage facilities and for the expeditious collection of port charges. The rules may also establish procedures for the enforcement of these rules” by the port.

• Purchasing Policy.  While there is no statutory requirement to adopt a purchasing policy, it is a “best practice” to adopt a policy that addresses spending limits, price bidding and other processes.

• Employee Handbook.  These tend to sit on a shelf untouched until something happens.  The “best practice” is to periodically review the Employee handbook to make sure it expresses the actual expectations of both the port and its employees.

As always, please contact your port counsel with any questions regarding this topic.  And, if you have a particular question for Knowing the Waters, please email me at: fchmelik@csdlaw.com.