Port cooks up land deal Port officials hope the land will lure big industry near Wallula.
By Vicki Hillhouse of the Union-Bulletin
The sale of the defunct Ponderosa Fibres plant to Boise Cascade subsidiary Boise White Paper is just one piece of a multifaceted, multimillion land deal slated for western Walla Walla County.
The Port of Walla Walla, which is facilitating the Ponderosa transaction, also plans to buy Boise's 1,900-acre Wallula fiber farm for $4 million, officials said this morning.
Port Executive Director Jim Kuntz said the pre-zoned industrial property, directly across from Boise's mill, is prime for long-term economic development. Port officials hope the land will entice new industry to the area on par with other major companies already operating in Wallula, including Boise, Tyson Fresh Meats and Railex.
``This is a strategic investment that gives us, I think, some real advantages at recruiting industries to the western portion of Walla Walla County,'' Kuntz said.
In a prepared statement, Port commission President Paul Schneidmiller said the purchase could make Walla Walla more competitive for development with other parts of the state.
``There are very few tracts of industrial zoned property like this in the state of Washington,'' Schneidmiller said. ``This will create a strategic advantage for the Port in attracting new industries to Walla Walla County.''
The announcement of the fiber farm purchase follows a decision Monday about Ponderosa. Walla Walla County commissioners approved sale of the former Ponderosa Fibres plant to the Port for about $2.6 million.
Located next to the Boise Paper Solutions mill in Wallula, the plant was built in
1996 with $110 million of Port-issued bonds. The facility was designed to recycle post-consumer waste paper into de-inked pulp for use in the manufacturing of recycled content printing and writing grade paper, according to the Port.
But in January 1999, Ponderosa Fibres filed for Chapter 11 bankruptcy. The county foreclosed on the facility in 2006, after plant owners failed to pay property taxes owed between 2000 and 2002. A public auction of the plant in December drew no bids.
The Port has granted Boise White Paper an exclusive option to buy the plant. Boise will use a portion of the money it makes from the fiber farm sale to buy the facility.
Kuntz said Boise initially expects to use the facility for warehousing. The company will explore options for reusing the building.
County and Port officials have heralded the ownership change as a way to get the plant back on the county's tax rolls.
Even though the Port's purchase of the fiber farm will remove 1,900 acres from the rolls, the addition of the former Ponderosa plant is greater, Kuntz said.
The Ponderosa plant is expected to bring in about $42,800 annually in property taxes, whereas the fiber farm pays about $22,183 annually under its open-space tax classification.
``Ultimately we are going to generate more tax revenues than what is lost by taking the land off the tax rolls temporarily,'' Kuntz said.
Boise has apparently determined the farmland is not needed for its long-term operation.
``Our fiber supply assessment concluded the Wallula Fiber Farm does not represent a long-term strategic source of fiber for Boise,'' said Chuck Wierman, Boise White Paper's fiber farm manager, in a prepared statement. ``While Boise believes fiber farms will continue to be a source of fiber for the Wallula mill, we have sufficient access to other fiber resources, including the 9,000-acre Ice Harbor Farm.''
The Port will issue revenue bonds - which are paid for by the income from a bonded project - to pay for the acquisition. Kuntz said the Port will honor Boise's current harvest schedule.
The 1,900-acre farm is divided into six blocks. Five of those are scheduled for harvest in 2010. The final block is slated for 2011. After that, there will be no new plantings.
Kuntz said if a development comes along sooner, the Port can ask Boise to accelerate its harvest schedule.
Kuntz said the Port has leads on two companies seeking 500-acre sites. But with the size of the property, he expects it may not be fully developed for 20 or 30 years. Nevertheless, with water resources, electricity, gas and access from what will be a four-lane highway as of August, the land could attract at least one substantial project within five years, Kuntz said.
The Port has two 90-day option agreements for the transactions. One is for the purchase of the Ponderosa Fibres facility. The other is for purchase of Boise's fiber farm.
The developments are expected to be discussed Thursday at 1 p.m. at the Port's public meeting at 310 A St.
Kuntz said little would need to be done to the fiber farm for development. The property contains a substantial water right that will eventually be converted from ag use to industrial The majority of the property is already zoned for industrial use.
``It has all of the critical infrastructure components that one looks at while acquiring industrial property,'' he said.
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