Development Authority Ripped for Unlawful Dealings with Tenant

OLYMPIA, WA-The Grays Harbor Public Development violated numerous laws in connection with a tenant at the failed nuclear power plant turned industrial park, according to a report released this week by state Auditor Brian Sonntag. The business park in Elma was developed from what was originally going to be a nuclear power plant for the failed Washington Public Power Supply System (WPPSS). The affected tenant was SafeHarbor.

“The authority did not comply with state laws regarding the conduct of business by local governments in several areas,” wrote Sonntag. For one, the audit says the PDA loaned $2 million of its credit to SafeHarbor so the company could purchase furniture, fixtures and equipment for the Satsop office—which it was hoped would generate a windfall of jobs in rural Grays Harbor. That same equipment was subsequently used as collateral for a loan obtained by SafeHarbor. Such actions were reported as being in violation of the state’s constitution.

Later, the PDA contracted privately to construct a second building for SafeHarbor, which now occupies a total of 91,000 sf of flexible use space at Satsop. The contractor on the project, Wood Holdings, built the property, then sold it to the PDA for $6.3 million. In the audit, Sonntag asserts, “We believe the authority entered into a complex financing arrangement to avoid the state bid laws.”