As the second phase of construction on a new pool facility nears completion, North County Recreation District board members and supporters are working to determine funding sources to complete the project.
Members of the project team have met several times in recent months with the Tillamook County Board of Commissioners to discuss the county supporting the project with transient lodging tax (TLT) dollars, most recently on November 6. Commissioners voiced support for the project but also concerns about the process of making the award and raised the possibility of granting funds to help repay a loan the district is considering as an alternate means of funding.
The project, which will replace the North County Recreation District's (NCRD) nearly century old pool in Nehalem, has received more than $16 million in support from numerous donors in the community as well as through a bond approved by district voters in 2020. However, cost escalations due to inflation have driven the project's budget well over its initial estimate, leaving the district facing a $2.5 million gap to complete the pool facility with the installation of equipment, commission the new facility and decommission the old facility.
Currently, construction crews are nearing completion on the second phase of the project and have dug the pools and finished much of the interior work, including the facility's lobby and locker rooms. The new facility will feature two pools, one with six lanes that will be able to host interscholastic competitions and a second therapy pool, sponsored by Adventist Health Tillamook, that will be accessible to individuals with limited mobility.
Work on the second phase is set to conclude by January 15, and NCRD Board Chair Michael Howes told commissioners that the project team hopes to have proof of funds for the next phase by December 13. This will allow the project to continue without demobilizing work crews between the phases or other delays, which would cause further price escalations.
Thomas Fiorelli, a consultant helping the district with the project said that the project team is continuing to look at a bevy of possible grants to support the project but that it was unlikely they would materialize in the condensed timeframe.
This led the team to start the ball rolling on a possible line of credit to keep the project moving forward. Howes told commissioners that he had reached out to banks about the possibility and was confident that the district would be able to secure a loan but that he did not yet have more specifics. He also said that the district's board would be discussing the possibility of taking a loan at their board meeting on November 14.
The next phase of the project, which will see the installation of pool equipment, will cost an estimated $1.75 million and is planned to begin in February and be complete by April, putting the facility on track for a June opening.
The commissioning of the new pool will cost $100,000 and decommissioning the old pool is expected to cost $350,000. That process will include draining and filling the pool but does not include money for any repurposing of the space.
A further $300,000 in work, including a water slide and interior acoustic tiling and finishes have been removed from the project's scope. Fiorelli and McCann said that the team hoped to raise the funds for those items as part of the final fundraising push but that they and the old pool's decommissioning were not necessary to get the project to the finish line.
Fiorelli and McCann said that the team is also working on updating the projected budget for the remainder of the project, noting that changes throughout multiple rounds of revisions and different plans for construction have led to some murkiness in the $2.5-million figure.
Howes and Barbara McCann told commissioners that the district is planning large celebrations for both the closure of the old pool and the opening of the new facility and that a board member has already donated to be the first to swim in the new pool.
At a previous meeting, commissioners confirmed that the county had $3 million in unallocated TLT funds that could be used to support the project and asked for the additional information provided on the 6th.
After the presentation, Tillamook County Commissioner Mary Faith Bell said that she was impressed by the amount of support the project had already received and that when considering supporting a project with TLT funds, it was important that partners also had skin in the game.
County Commissioner Erin Skaar said that she loved the project and wanted to see it succeed but that her concern was the process of making the grant. Skaar said that there were many projects in the county that would like to receive funding from the board of commissioners and that there was a designated process, run by the Tillamook Coast Visitors Association, for making grants each year.
Skaar said that she was concerned that it might appear unfair to proponents of other projects, like the Salmonberry Trail or revitalizing Hangar B at the Port of Tillamook Bay, if the pool project received funding from the commissioners just because they asked.
County Commissioner Doug Olson said that he supported the project and was willing to consider financing at least part of the remainder but that the details need to be clear before commissioners commit taxpayer money. Olson also said that he shared Skaar's concerns about equity among projects.
Bell responded that while the county had a process in place for making grants, the commissioners had also voted in the past to allocate funds to projects that they felt were deserving. She said that while she also believed in following processes, she did not feel that there needed to be a process developed for this specific situation.
Bell echoed Skaar and Olson's concerns about being unfair to other projects but pointed out that TLT awards had not always been equitable in the past and that the board had acted expeditiously when other good opportunities came up, citing the purchase of the Jentzen property in Pacific City. She continued that the excess TLT funds would not be sufficient to support projects like the Salmonberry Trail or hangar rehabilitation in their entirety and that she favored using them to help leverage other opportunities for big projects across the county.
In that vein, Bell said that she thought it would be a good approach to have the district take out a bridge loan and then award TLT funds to help offset some or all the debt payments, which would allow the county to support the project without emptying its savings account.
Howes said that was a great idea and would eliminate concerns about debt service obligations outstripping the district's revenues.
Skaar said that she was open to the idea but that she would want to know more details before making a decision, including how much debt service would cost and how much the district could cover with its own revenues. She also said that she would want to consider other projects that could be in line for TLT funding to make sure that a grant would not prevent supporting other projects.
Olson said that he also favored the idea of helping to service the debt over giving a lump sum, as it would allow the district to secure the loan and leave the county more flexibility.
Skaar asked that the project team get specific numbers relating to a bridge loan and Howes said he would gather the data and return for further discussion at the commissioner's next briefing on November 13.