Port of Vancouver issues $32.55 million in bonds for Terminal 5

VANCOUVER, Wash. – The Port of Vancouver has successfully issued $32,550,000 in General Obligation Bonds [Alternative Minimum Tax] for the purchase of its new Terminal 5 facility, Executive Director Larry Paulson announced today.

Bonds were issued on Tuesday, December 9 in Portland. Underwriters on the bonds are Seattle Northwest Securities and Edward Jones Company. The bonds were issued to institutional and retail markets.

“In terms of the market, this was a successful sale,” said the port’s Director of Finance and Accounting Maggie Smith. “Although the entire $40 million issue was not sold, this sale provides enough cash toward the purchase price of Terminal 5.”

Terminal 5 is the property that formerly held the Alcoa and Evergreen Aluminum operations. Evergreen Aluminum recently completed its demolition and cleanup of the property, and has received acceptance of its cleanup from the Department of Ecology. Alcoa’s demolition, and environmental remediation, is also nearly complete.

“We were fortunate enough to obtain $32.55 million for the acquisition of property and construction of rail, which is needed to create jobs and economic benefit to this community,” Paulson said. “These bonds are backed by the good faith of the community, supported by the tax levy which is limited to repayment of debt, and environmental cleanups.”

Projections tell port staff that when Terminal 5 is complete, as many as 1,000 jobs could be created on the site, depending on the use and customer. Port industrial tenants pay leasehold excise taxes, which nearly equal property tax, in turn providing revenue for state and local services.

The port expects to close the purchase of the Evergreen property by the end of January 2009. Alcoa’s closing appears to be set for the end of March 2009.

Funds from the bond could also be used for construction of rail facilities for the port’s West Vancouver Freight Access project, if needed.

The bond sale closes on Thursday, December 18 at 9 a.m., at which time the funds will be provided to the port.

“In this market, our True Interest Cost (TIC) of 6.74 percent is really good,” Smith said.

The port’s last bond sale occurred in 2003 and was used for renovating Terminal 3.