MINUTES OF THE PORT OF BELLINGHAM COMMISSION MEETING HELD TUESDAY MAY 15, 2018 HARBOR CENTER ROOM 1801 ROEDER AVENUE, BELLINGHAM, WASHINGTON

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1 MINUTES OF THE PORT OF BELLINGHAM COMMISSION MEETING HELD TUESDAY MAY 15, 2018 HARBOR CENTER ROOM 1801 ROEDER AVENUE, BELLINGHAM, WASHINGTON Present: Staff: Commissioners: President Vice President Secretary Rob Fix Sunil Harman Don Goldberg Adam Fulton Tamara Sobjack Elizabeth Monahan Shirley McFearin Terry llahi Mike Hogan Jan Sitkin Diane McClain Ken Bell Bobby Briscoe Michael Shepard Executive Director Aviation Director Economic Development Director Facilities Director Finance Director, Auditor Human Resources Director Real Estate Director Real Estate Analyst and Representative Public Affairs Administrator Port Counsel Executive Secretary 3:00 p.m. - OPEN PUBLIC MEETING, ROLL CALL, Commission President Bell called the meeting to order at approximately 3:00 p.m. and noted for the record that all Commissioners were present and that today's meeting would have a different format beginning with a Work-study informal session. WORK STUDY SESSION At the April 17, 2017 meeting, the Commission decided that occasionally, an informal Work-study session and Commission discussion before the start of a regular business meeting might be helpful. They also decided the topics of interest for the first Workstudy session should include the ASB (Aeriation Stabilization Basin), Broadband and Economic Development. It was determined that Work-study sessions and topics will be included on the Commission meeting agenda that is distributed a week before the Commission meetings. ASB: Executive Director Rob Fix announced due to staff absence, the ASB (Aeriation Stabilization Basin), discussion would need to be postponed to a later date. Broadband- Executive Director Rob Fix and the Commission discussed the current broadband service in two categories, local intra county service and the connection of Whatcom County to both Seattle and Vancouver. Regarding the local portion, some areas in the county are served better than others. In areas where there is limited or no access to the internet, there is a definite disadvantage to business and education opportunities. Possible solutions for consideration here in Whatcom County and being done elsewhere in the state include partnering with others such as cities, ports, Public Utilities Districts (PUDs) to share in the ownership and expense for providing fiber and connectivity to Broadband. Whatcom County Economic

2 Page 2 Development Investment (EDI) or CERB funds might be another possible funding source. The group discussed current Internet Service Providers (ISP), high speed vs. dialup connections, competition, Irrevocable Right to Use (IRU) agreements, single, double and multiple strand fiber options ranging in cost from $1.7 million to $10 million. The Commission directed the Executive Director to explore the possibility of a Port of Bellingham purchase of an IRU for the two strand existing fiber between Seattle and Vancouver. Economic Development- The Commission asked newly hired Economic Development Director Don Goldberg to provide a recap of his first four months working at the Port. Mr. Goldberg discussed site visits in Whatcom County and Canada, various observations and potential economic development opportunities, meeting members and leaders in the community while setting up the office and staffing vacancies within the Economic Development division. The Commission, Mr. Goldberg and Executive Director Rob Fix discussed future plans for contacting businesses through various means of communications, the Port's mission to keep the focus on creating new jobs, assisting existing companies, attracting new businesses to the area while recognizing the need for affordable housing in Whatcom County. PUBLIC COMMENrPERIOD The following participated in the first public comment period. 1^ Alexander Dixon, owner and founder of the Summers End Music and Arts Gathering, currently in its 3 year, spoke about holding this ticketed event at Zuanich Park in Squalicum on August 17, Permitting a ticketed event at Zuanich would involve closing off a portion of the park to the public. Mr. Dixon reported kids under 12 are free and those wishing to attend and not able to pay are welcome to volunteer or contact him. The Commission discussed concerns with closing a Whatcom County public space for a private event, potential benefits to holding events such as this one on Port property, public input received thus far regarding the closing of a public park. It was decided that further discussion would continue later in the meeting under the Other Business portion of the agenda. 4:30 CONCLUDE WORK STUDY SESSION AND BEGIN REGULAR BUSINESS MEETING CONSENT AGENDA Motion: Approve Consent Agenda items A through P. A. Approve the minutes of the April 17, 2018, regular Commission meeting. B. Approve Resolution No authorizing the Port's Treasurer and/or Deputy Treasurer to open a Safekeeping Account with U.S. Bank. C. Approve a Use Permit for Washington Food Truck Association to operate Mobile food service vehicles in Squalicum Harbor.

3 Page 3 D. Approve the Renewal and Modification of Lease between the Port and Movement Mortgage LLC for Suite 110 containing 2,590 sf at the Bayview Center Building. E. Approve a Use Permit for Pacific Coastal Ventures, Inc., dba Alaska Wild Fish and Chips to operate a Mobile food service vehicle in Blaine Harbor. F. Approve a Use Permit for William Nelson and Kirsten Lutes dba Compass Rose Coffee to operate a Mobile food service vehicle in Squalicum Harbor. G. Approve Consent to Sublease Agreement between the Port and Sound Pacific Seafood to allow Verizon Wireless LLC use of Lease premises in Blaine, Washington. H. Approve a Commercial Lease between the Port and City Cab, Inc., and City Paratransit Inc. for office space at Fairhaven Station. I. Approve these agreements between the Port of Bellingham and San Juan Sailing, Inc.: i. Commercial Lease for premises at Squalicum Esplanade, Suite 1. ii. Modification of Lease for premises at Squalicum Esplanade, Suite 2. ii. Consent to Assignment of Agreements related to the transfer of capital stock between owners VanDyken, Carnahan and Huston. J. Approve Consent to Assignment of Airport Land Lease from Aviation Component Services, Inc. to JCKK MARK LLC, for Bellingham International Airport Binding Site Plan # 1B, located at the Airport Industrial Park. K. Authorize the Executive Director to execute Amendment No. 4 to the Professional Services Agreement with Kennedy/ Jenks Consultants for Industrial Stormwater General Permit Support services. L. Authorize the Executive Director to execute Amendment No. 1 to Professional Services Agreement with The Greenbusch Group, Inc. to expand the design work to include re-roofing of the Bayview Building's mechanical platform in the amount of $12,000 for a total contract amount of $120,020. M. Approve Amendment No. 1 to the Building Radio Distribution Agreement between the Port and Verizon Wireless LLC to enhance wireless communications at the Bellingham International Airport (BLI). N. Authorize the Executive Director to execute a Purchase Agreement with Marina Dock Parts, LLC of Bellingham, Washington for the Squalicum Harbor Dock Box Purchase in the amount of $32, Authorize the Executive Director to execute a Grant Agreement with Puget Sound Energy (PSE) for a credit up to $67,210 for the HVAC control system improvements currently underway at the Bellwether Building. P. Approve Modification of Airport Lease (Airline) between the Port and Allegiant Air LLC for operations at Bellingham International Airport, and Modification of Airport Lease (Commissary Building) between the Port and Allegiant Air LLC for premises at the Bellingham International Airport (BLI).

4 Page 4 Discussion: The Commissioners sought clarification on a few items and opted to pull a few items from the consent agenda for discussion and separate votes. With regards to the Minutes of the April 17, 2018 meeting, Commissioner Bell identified a type and an omission (stating work-study topics to be provided in advance under the Other Business section) in the minutes. The Commission was agreeable to signing a revised set of minutes with the corrections made. Amended Motion: Motion to approve Consent Agenda items A (as amended) through P, removing items C, and F for a separate vote. Motion approved with 3-0 vote. C. USE PERMIT FOR WASHINGTON STATE FOOD TRUCK ASSOCIATION MOBILE FOOD SERVICE VEHICLES IN SQUALICUM HARBOR Motion: Approve a Use Permit for Washington State Food Truck Association to operate Mobile food service vehicles in Squalicum Harbor. Discussion: Real Estate Analyst and Representative Terry llahi discussed the specifics of the proposed use permit. The Commission debated bringing mobile food service into areas of existing Port tenants, citing potential impacts from competition and disruption. They also discussed potential benefits by attracting people to the area. Commissioner Briscoe was not in favor of granting permits without first notifying tenants. Real Estate Director Shirley McFearin mentioned this service could be tested on a trial basis; either party has the option to terminate, and she will contact tenants the following day. Motion approved with 2-1 vote. Commissioners Bell and Shepard voted in favor, Commissioner Briscoe opposed. F. USE PERMIT FORWASHINGTON STATE FOOD TRUCK ASSOCIATION MOBILE FOOD SERVICE VEHICLES IN SQUALICUM HARBOR Motion: Approve a Use Permit for William Nelson and Kirsten Lutes d/b/a Compass Rose Coffee to operate Mobile food service vehicles in Squalicum Harbor. Discussion: See discussion on similar Item C. Motion approved with 2-1 vote. Commissioners Bell and Shepard in favor, Commissioner Briscoe opposed. PRESENTATIONS Audit Entrance Conference- Finance Director Tamara Sobjack introduced the team of auditors from the local Office of the Washington State Auditor's office (Audit Manager Deena Garza, Audit Lead Julie Styrna, and Assistant Audit Manager Arden Flares) to discuss the audit process. The group explained the purpose for engaging the auditor's office to conduct an annual independent audit is to receive verification that the Port's financial information is in compliance with state, federal and local laws and ensure public trust and transparency. The purpose of the entrance conference is to lay out the scope of the audit, receive

5 Page 5 input from Commission and answer any questions. The accountability audit for fiscal year 2017 will assess the Port's management of payroll, bidding and procurement for construction projects, third party cash receipting and general disbursements. In addition to conducting the 2017 financial statement and Passenger Facility Charge audits, reporting information is submitted annually by the Port for consideration for the Government Finance Officers Association (GFOA) Certificate of Achievement in Financial Reporting (CAFR) award. The team also explained the audit communication process, engagement letter, reporting levels for any identified audit issues and exit items. The estimated cost for the fiscal year 2017 audit is approximately $39,900 and the results of the audit will be summarized by the group at a future exit conference. Western Washington UniversJty (WWU) Student Mural Proposal Public Affairs Administrator Mike Hogan introduced Paula Airth, Assistant Professor of Design from Western Washington University (WWU) to provide a brief overview of the proposed art mural to be created by WWU Students and displayed on the fencing east of the ASB (Aeriation Stabilization Basin) pond, upon Port Commission approval and per the terms of an executed Site Use Agreement. The mural phrase 'RISE and SHINE" would consist of 12 letters individually created by 12 selected students (with the assistance of professional freelance designer and illustrator Marisol Ortega). The artwork would be installed in the next few weeks. The Commission was in favor of the installation and asked that a brief explanation of the artwork also be placed on the site. 5:30 PUBLIC COMMENT PERIOD -No one participated in the second public comment period: OTHER BUSINESS Alexander Dixon- Summer's End Event (continuation of earlier public comment discussion). Owner Alexander Dixon answered questions as the Commission further discussed the permitting of the August 17, 2018, a one-day ticketed private event to be held at Zuanich Point Park; closing the park to the public. Executive Director Rob Fix commented that this sort of event on Port park properties could be limited to up to 3 times a year. The Commission discussed the benefits and use of revenue for successful events on Port property as well as tenant access, parking and traffic concerns. Mr. Fix responded that Port staff will notify tenants and explore shuttle and alternate methods of transportation. Mr. Fix then made the following motion: Motion: Approve the closing of Zuanich Point Park for a private event on August 17, Discussion: Commissioner Briscoe was not in favor of taking action without more time and due to the issue not being on the agenda and reported he would not support the closing of a public space. Commissioners Bell and Shepard were concerned that the event promoter needed to know one way or the other so he could promote his event and called for the vote.

6 Page 6 Motion approved with 2-1 vote. Commissioners Bell and Shepard in favor, Commissioner Briscoe opposed. INTERLOCAL AGREEMENT WITH WADOT AND AIRPORT IMPROVEMENT GRANT APPLICATION Motion: Authorize the Executive Director to execute an Interlocal Agreement (ILA) (Exhibit A) with WADOT in the FAA grant eligible amount of $45,000, and submit an FAA FY18 Airport Improvement Grant Application (Exhibit B) in the amount of $140,000, 90% of which will be reimbursed through FAA entitlement funds for the ILA and 30% design for the BLI Runway 16 end Runway Safety Area (RSA) compliance improvement in the 1-5 Right-of-Way with WADOT. Discussion: Aviation Director Sunil Harman apologized for short notice and explained the need for the proposed action, FAA requirements pertaining to the Runway Safety Area and the specifics of the grant application process. Motion approved with 3-0 vote. RECESS TO CLOSED EXECUTIVE SESSION At approximately 5:58 p.m, Commission President Bell announced the public meeting would be recessed for an executive session. He also reported the purpose of the executive session was to discuss potential litigation pursuant to RCW (1) (i). The executive session was expected to last about one hour. The Commission would return by 7 p.m. to close the executive session and reconvene the public meeting. Upon reconvening, if no further business, the meeting would be adjourned. There would be no formal action taken by the Commission in the executive session RECONVENE PUBLIC MEETING, ADJOURN The executive session was closed, meeting reconvened and with no further business, immediately adjourned at approximately 6:50 p.m. ^7 9f^-) Secretary