The United States, Washington State, and Kitsap County are in the midst of the worst recession we have experienced in 75 years. Many economists have said that the economy bottomed out last summer and is on the rebound. And no one can agree on when the recession will end. It may be one to five years before we see growth in our economy. So, what is the state of the Port of Bremerton and what does it look like for 2010?

The Port of Bremerton has weathered the recession far better than most government bodies to this point. In 2009 the preliminary numbers show our operating revenue was down $367,000, yet our operating spending was down considerably more at $1,173,000. That was due in part to not filling a budgeted staff position and watching our spending and does not include the savings from decisions to forgo capital projects. Could we have done better? Probably, but I am proud of the Commission and Port staff for the job we did in controlling our spending.

In adopting the 2009 budget, the Port Commissioners decided to freeze the property tax at the 2008 level and not levy an additional 1% that is allowed by law. We were able to do that by increasing revenue from leases of Port properties. For instance, keeping our buildings filled with tenants in these challenging times. The Port of Bremerton owns and leases 9 industrial buildings consisting of over 156,000 square feet. At the end of 2009, we had a vacancy rate of 10% in our building leases. That compares to an almost 20% vacancy rate in the Seattle metropolitan area. Further, we have been able to maintain and grow our leasing rates as compared to a 30% decline of commercial real estate leases in the Seattle metropolitan area.

The hardest hit sector of our economy is business that depends on discretionary spending such as aviation, golf, boating and restaurants. People have reduced spending in these activities and that, coupled with the tremendous loss of jobs, means difficult times for our airport and marinas. Bremerton National Airport is one of the finest General Aviation airports in Washington State. Last year we completed a 5,000 foot overlay of the runway and an extensive stormwater upgrade. The job our staff has done to maintain the runway has kept our hangars mostly full with only 3 empty large hangars.

Our Port Orchard and Bremerton Marinas have been the hardest hit in this economy. Our Port Orchard Marina has seen more seasonally vacant slips than in past years and we all know that our Bremerton Marina is not meeting its goals in terms of its vacancy rate. The Port staff has developed a very aggressive marketing plan to lease more slips in 2010 and that effort begins at the Seattle Boat Show later this month. The bright spot in our Marinas is the number of boats that visited last year. We had 7,476 boater days in our two marinas. That is up from the 6,838 boater days in 2008.

This year we will be focused on building and increasing the infrastructure of the Port that will bring private investment and jobs to Kitsap County. The first priority will be to build the first phase of the Cross SKIA (South Kitsap Industrial Area) that will open up the east side of the runway for aviation related development and planning and design for the second phase. We will be working with our SKIA partners to complete the third phase and final phase of the project which will open nearly 2,000 acres for industrial/manufacturing development.

The Ports in Washington State are the only units of government that are charged with economic development and the Port of Bremerton has positioned itself to take advantage of a rebounding economy we all look forward to.