Port of Olympia’s four business lines all performed better than projections in 2023, the port’s year-end financial report showed, but most of the agency's debt was excluded.
Finance Director Tad Kopf presented the report to the Port Commission on Monday, May 13. While the figures show that the port’s four business segments performed better than expected, the calculations per business segment did not account for all annual debt payments and environmental expenditures.
Overall, the port generated revenues of $17.1 million and spent $9.4 million on operational and maintenance expenses and $3.2 million on general and administrative costs. Accounting for depreciation costs of $3.8 million and bond interest payments of around $757,000, the port netted around $16,000.
Before the report was presented, resident Carla Wulfsberg took issue with the port’s reporting process. Wulfsberg, who cited a report from someone she said was a local financial expert, took issue that environmental costs and debt payments were not attributed to the four business lines.
Annual debt payments, including principal and interest, totaled $4.6 million while environmental expenditures were $3 million.
While Kopf showed a slide allocating $757,000 of the interest payments to the four business lines, most of the debt payments were not accounted for in calculating the bottom line of the four segments.
“This really attributes to the issue of transparency that you and the public should have knowing about all of your business units,” Wulfsberg said.
Commissioner Jasmine Vasavada mentioned the same issue with environmental costs. In response, Kopf said that they will delve deeper into these expenditures when they meet in June for a presentation about the 2024 Q1 report. The director added that he would better explain why revenues and expenditures might not be aligned with the budgeted amounts.
In terms of capital spending, the port underspent more than what was originally budgeted for in 2023. Last year’s capital budget was $2.7 million but the port only spent around $922,000.
Kopf explained that the underspending was due to staffing changes and uncontrollable delays which led to the shifting of these expenses to 2024. Kopf said they expect the 2024 capital expenditures to better align with the budget due to improved staffing and better management situation.
Kopf shared other financial metrics such as liability-to-asset ratio, debt load, and several other financial indicators recommended by the State Auditor’s Office and required by the port’s policy.
The port yielded a liability-to-asset ratio of 2.57, which Kopf noted was better than the state’s benchmark of 1.75.
Debt load measures how much of the annual revenues goes towards paying off debts. Debt load was at 17% last year, which is more than the recommended target of 12%, according to Kopf.
If the port does not incur additional debt, the director said that these debt payments will largely be alleviated by 2028 when annual debt payments will only be under a million dollars.
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Honestyandrealityguy
As a retired CPA, the numbers are generally not accurate when the liabilities and assets are excluded. Can be incredibly misleading. Should get someone qualified to help.
Monday, May 20 Report this
BobJacobs
The Port of Olympia District, which should be named Port of Thurston County, has a long history of using inaccurate financial reporting to cover up its perpetual losses. We Port watchers are hoping the new Port Commission members, executive Director, and staff would start producing the "transparency" that they promised. This financial report misses the mark be a wide margin. We look forward to future reports being accurate.
Not only have the operating units lost money most years, but the Marine Terminal suffers big losses every year.
In addition to the Port's financial reports, it should reveal the additional costs of Port operations that don't appear on its books. This includes the airport control tower and Marine Terminal dredging provided by the federal government, and a half billion dollars of real estate provided by us, Thurston County residents (a subsidy worth 25 million dollars per year).
Bob Jacobs
Monday, May 20 Report this
JulesJames
Debt would seem to be fairly easy to provide as a list. Date issued, amount, coupon rates, interest paid per year. In the private sector, when a company says "Oh -- don't worry about the debt" is precisely when to worry about the debt.
Tuesday, May 21 Report this
HappyOlympian
Close the port, end the scam.
Tuesday, May 21 Report this
davidlee
Could not being profitable be somehow okay? Public schools aren't profitable, for instance. I ask out of actual curiosity.
Dave Bellefeuille-Rice
Tuesday, May 21 Report this
JW
The Port is a money laundering scheme fleecing the taxpayers.
Tuesday, May 21 Report this
CPWINOLY
Public schools don't have to be profitable, they provide an important public service by educating the next generation of citizens. I don't mind mind paying property taxes for them. I do mind paying property taxes for a perpetually unprofitable business which provides no direct or indirect benefit to me.
Tuesday, May 21 Report this
BevBassett
After watching the Port closely for about 5 years and attending most commission meetings and work sessions in a period that ended in 2017, I concluded that the Port of Olympia functions successfully to move public monies into private hands. Year in and year out.
Yachters, airplane owners, real estate people of all sorts, consultants, consultants consultants take the public tax monies that should rightly be spent to improve the people's quality of life and the value of our publicly owned billions of dollars of assets and resources in land and buildings that is The Port Of Olympia. But the good of the public or our environment has never been honestly considered by the Port thus far in my experience. And they have been blatantly dishonest in the way they have reported their finances/financial situation.
Tuesday, May 21 Report this
OlyFan
I am curious why the Port of Olympia should be called the Port of Thurston County. Why is the Port of Seattle not called the Port of King County? Why is the Port of Tacoma not called the Port of Pierce County? Of course the Port of Olympia serves Thurston County. It just happens to be located in Olympia. If some public actually did their homework, they would find that an overwhelming number of the 75 ports across Washington state are not named after the county in which they are located. Complain about something that is important and has meaning. This is a waste of breath, time and money. Do you know how much money it would cost in just rebranding? How about paying down some debt instead of wasting money on a name change. Let's think about this, folks!
Tuesday, May 21 Report this
Qphillips
The report out should have included an analysis that included debts and liabilities as apportioned by operating unit. The financial model provided possibly was a good faith attempt to show, without the liabilities and debt, how the operating units were performing. This specific analysis can be included as a package of financial report outs. The primary report/analysis though should include debts and liabilities,however, the stripped out analysis is helpful in determine if attempts to improve operating unit performance are succeeding. They very well may have been the purpose of this particular analysis that was presented. Transparency in financial reporting to the community is essential to obtain community support. Financial reports need to be consistent from reporting period to reporting period. Varied revenue sources such as grants etc should be identified.
Thursday, May 23 Report this
Boatyarddog
This Port and its rather new assembly of Staff, commissoners would do well to Finally Listen to The People....
It Is Our Port after all, and we Pay for its subsidies, grants, programs plans, AND Legal Expenses.
The Port has been run into Debt, and we Need To Know Why and what has caused its demise.
As Weyhauser is Now the Only Logging outfit there and receives a Sweetheart Rate.
Where is the business going to come from?
If R. Rudolp has any "knowledge" of potential Business that we Can welcome in Olympia.... why wasn't it shown in Past Years.
This.... " were going to do better this year is BS.
Nothing has happened.
Nothing but a continued Enviromental Absurdity will be The Marine Terminals End result.
The Marine Terminal is Debt ridden and serves only Logging, and its Longshore Workers on the Taxpayers Dollars.
Close the Marine Terminal before they try to raise the Levy Rates again.
Longshore workers can Move, commute, or Quit.
Thursday, May 23 Report this
AlexSmith
We appreciate the community's thoughts on the Port of Olympia's finances and our efforts to communicate them effectively. We absolutely agree that it is important for the Port to be transparent and accountable, and we are committed to accurately reporting our finances and to continually improving how we present that information to the public. For those community members who are interested in learning more about the Port's bond debt, we invite you to join us at our upcoming commission meeting on May 28 at 5:30 p.m. During this session, we will provide a presentation on debt reduction proposals. We look forward to the opportunity to share this information.
Friday, May 24 Report this