Officials with the Fort Worden Public Development Authority unanimously agreed last week to end the “emergency” declaration for its troubled “glamping” project.

Adopted by the PDA in April, the emergency designation was adopted in the hopes that the PDA could hire a no-bid contractor to complete the “glamorous camping” tent project.

But at last week’s PDA board meeting, executive director David Timmons said the costs to complete the project were beyond the $600,000 that the PDA could spend to finish it.

He also noted that finishing the project may cost upwards of $1.5 million; money that the PDA does not have.

Meanwhile, he said the tents that have already been put up have been deteriorating through lack of use and shouldn’t be kept standing through the summer.

The project has been snake-bit from the start. The PDA announced its plan for 24 high-end camping tents in 2018, with hopes to have 20 tents available for visitors in 2019.

Installation of water, electrical and other improvements started in 2019, and PDA officials imagined finishing the project in phases, with 15 bathroom-equipped tents ready for campers in June 2020.

The COVID-19 pandemic ultimately shut down additional work on the project.

MORE COSTLY THAN EXPECTED

At last week’s meeting of the PDA board, Timmons told officials he had spoken with two contractors, and one said it would cost more than $600,000 just to finish the first 15 tents.

The project has a much larger scope, Timmons added. It also includes a 1,450-square-foot commons building — needed because another four tents in the project do not have bathrooms —as well as a 29-car parking lot with 10 electric service carts. There was also supposed to be a hospitality host.

Furnishings are also needed.

“It is a much higher end-product than you would expect conventional camping to offer.”

“It’s not just a bed; it’s a high-end bed,” he said, plus bed linens.

“Generally, some of these have TVs. They are heated. They have barbecues, they have fire pits.”

Extensive landscaping of the glamping grounds is also needed.

Timmons also noted that the earlier estimate for how much money the glamping project would bring in contained “major mistakes ... and errors.”

There’s also the reluctance of Fort Worden Hospitality — the nonprofit that took over management of the accommodations, restaurants, catering, and venues at Fort Worden State Park in February — to take over the glamping project in its unfinished state, even with 15 completed tents.

“Eventually, what we have to look at is a lot more work with [Fort Worden] Hospitality on how we would partner,” Timmons told the board. “When they are going to be available to assume responsibility, and how we might be able to go forward and finish the project in its entirety.”

“That’s going to be critical to its success and performance,” he said of the glamping project.

Noting the sunk costs for the project — money that has already been spent and can’t be recovered — Timmons said he was looking at options.

“I did meet with the bank to discuss with them about options. They are very willing to work with us on those options,” he told the board.

A more practical plan needs to be found, he added, but that’s going to take time.

Timmons asked the board to rescind its emergency declaration for the glamping project.

“We’re just not going to be able to respond and produce a finished project in a timely fashion,” he said.

“It’s not the good information that we were hoping for,” said Board Member Torie Brazitis.

‘CRITICAL MISCALCULATION’

Another problem is the faulty financing assumptions made about the project years ago.

Timmons said the original concept plan for the project had a budget of $1 million. It was split into two components, with utility, groundwork, and infrastructure work handled by a contractor, but in-house labor used for the rest, the financial estimate for the project climbed to $2 million, with a debt schedule that ran for
10 years before the work would be paid off.

“My initial look at it is, there is a critical miscalculation, I think, in the overall performance of it.”

PDA officials had earlier hoped to have the glamping debt retired by Fort Worden Hospitality with rentals from the tents after the nonprofit took over the glamping project.

Timmons added that he didn’t know if the PDA would be able to recover those sunk costs after the handover, or if the PDA itself would be responsible for that debt.

Finishing the tents, Timmons said, “came in at 200 percent more of what was estimated.”

“And that didn’t include the commons building. That’s another critical piece of this,” he added.

The PDA will soon need to make choices on what to do with what’s already been done, and potential next steps.

“I don’t think it’s safe to leave the tents up over the summer again. Or just leave them there unattended,” Timmons said. 

“They are starting to show some condition issues,” he explained, due to the lack of occupancy and the lack of use of the facilities.

The site itself is getting overgrown.

“We’ve got to make some decisions as to how we’re going to move forward, sooner than later,” Timmons said.

PDA Board Chairman David King said it would be wise to take time to work things out, especially considering the role of Fort Worden Hospitality.

“There’s just too many open questions of how this should end up. To do it right, we’re going to have to go back and relook at the financial situation regarding the entire project,” Timmons said.

He offered a simple analogy on why the glamping project couldn’t proceed without all its pieces.

“It’s like building a house and then you don’t put siding on it, or shingles,” he said. “It’s kind of almost an all-or-nothing proposition. It’s a complete package.”

“Finishing out the 15 tents, we don’t really have the complete package. It’s going to be very incomplete,” Timmons said, and added that Fort Worden Hospitality would have to struggle with it as a liability.

Eventually, the PDA will need to pay back the money it has already spent on the project.

The PDA will need to start making payments in December 2023 to pay back the loan that was obtained to finish the glamping project.

OPTIONS ON THE WAY

Timmons told the board he would have more information on possible options in June.

The PDA itself doesn’t have money coming in that could be used to retire the debt, even if the authority decided to pull the plug on finishing the project.

“It’s the sunk costs that we can’t walk away from,” he said.

“How do we look at repayment of that absent any kind of income stream?” Timmons asked. “There’s no way we can just walk away from the debt at this point.”

Still, he said the hope remains that the project will be finished; somehow, some way.

“It’s not a question of whether the project will get done. It’s just a matter of timing, I think, at this point, and how much additional investment and who would be willing to take that on to get the project fully completed,” Timmons said.

“I just don’t think the PDA is in the position to do that,” he added. “I don’t think we can assume any more debt or liability at this point.”