Spring 2021 Annual Report

Financial State of the Port

The Port of Hood River’s current financial condition is summarized in this overview of financial performance and activities for the Fiscal Year ending June 30, 2020. Two government-wide statements report the Port’s Net Position and changes from prior years, both helpful measures of the Port’s financial health. Net Position is the difference between assets and liabilities. Government-wide financial statements of the Port are divided into two categories:

Governmental funds – The Port maintains two governmental funds: the General Fund and the Bridge Repair and Replacement Fund. The General Fund records transactions related to policy making and strategic planning based on the Port’s mission and values, and support services. The Bridge Repair and Replacement fund is a Special Revenue Fund used for capital improvements, planning, inspections, repairs and replacement activity associated with the bridge, as well as debt-related activities.

Business-type funds – Business type activities are used to distinguish operating revenues and expenses from non-operating items. The Port maintains an enterprise Revenue Fund which records fees and receipts from: bridge tolls; leased property; marina boat slip and airport hangar rent; and recreational events, parking and programs.

Statement of Net Position

Net Position serves as a useful indicator of a government’s financial position especially when viewed over multiple time periods. The Port’s Net Position on June 30, 2020 was $46,641,219, representing a $2,197,208 increase over the prior year.

Table 1 depicts an increase in total assets of $4,462,915, primarily attributable to the timing of a balloon payment of $1,834,630 deferred until July, 2020, and the refinance of that balloon debt payment of $1,860,534 that occurred before the end of the Fiscal Year. The remaining increase is due to the increase in grants receivable of $908,846 for the airport north apron project and bridge replacement environmental impact process. Capital assets decreased $24,331 from the prior year.

The largest portion of the Port’s Net Position, at 74%, are invested in capital assets(e.g. bridge, land, buildings, and equipment) and reported net of accumulated depreciation less any outstanding related debt. The Port uses these capital assets to provide services to the public; thus, they do not represent resources available for future spending. A Restricted Net Position of $286,300 represents cash and investments that are legally restricted for debt service related to the marina flex lease debt and a taxable general revenue bond. The Port issued a taxable general revenue bond to replace the balloon payment of an outstanding note payable deferred until July 2020. Finally, the remaining $12,005,199 is unrestricted, meaning it is available for meeting the Port’s ongoing obligations.

Statement of Activities

As with the statement of Net Position, the Port reports financial activities by its two distinct fund types: Governmental and Business-type. Table 2 illustrates the Port’s total Net Position increased by $2,197,208 or 5% compared to the prior year. 

Governmental Activities – The Net Position for governmental activities decreased $479,080 or 5% from the prior year. This decrease is primarily due to lower inter-fund transfers from the enterprise fund to the governmental funds for bridge planning and reimbursements from a State of Oregon grant which funded the final environmental impact studies for bridge replacement efforts.

Financial highlights of governmental fund activities for the year include:

•          Reimbursements amounting to $1,397,655 from a $5 million legislative grant for final environmental impact studies for bridge replacement.

•          Higher interfund transfers by $1,688,822.

•          Property taxes continue to increase about 5% as projected.

•          Higher investment earnings due to higher reserves.

•          Personnel cost decreased slightly ($8,583) with less staff time dedicated to the bridge replacement planning and legislative advocacy.

Business-type Activities – Business type activities generated a $2,676,287 (8%) increase in the Port’s total Net Position. The financial results for this year include a $570,782 decrease in toll revenues (10%) due to the COVID-19 pandemic. Bridge traffic showed a 8% decrease (334,998 travelers) over the prior year. Lease revenues from industrial and commercial properties decreased $105,196 (4%) due to deferred or waived lease payments to businesses impacted by the pandemic. Recreation revenue decreased by $10,365 due to fewer visitors and lower street parking use. Capital grants continued to play an integral role to the Port as $1,389,445 was received for the north apron airport project. The Revenue Fund increased by $2,203,292, primarily due to the increase in capital grants for airport projects. Expenditures increased by $723,864, attributable to higher operating and maintenance costs for the bridge ($331,707), as well as an increase of $123,647 for waterfront industrial property professional services related to the possible acquisition of land. 

Financial Analysis and Outlook:

The Port is involved in a variety of activities that contribute to the economic health and vitality of the community. The major source of funds for Port operations continues to be the toll bridge, accounting for 63% of operating revenues, excluding grants. Lease revenues and fees continue to improve diversification, with a 95% occupancy rate at year-end. The Port’s purchase of Lower Mill for future industrial uses is in the final steps to shovel ready development.

The Port receives property taxes that account for 1% of total revenues. Capital grants continue to play a vital role in how the Port develops its properties, including airport improvements. The Port receives a marina operating grant from the Oregon State Marine Board. The Port continues to develop light industrial properties that may result in new tenants and jobs, while undeveloped land at the waterfront (Lot 1) will hold future opportunities.

The Port looks at its business units in the following categories: Bridge, Leased Properties, Undeveloped Property, Recreation, Marina, Airport and Economic Factors.

Request for Information – A full Financial State of the Port with more detail can be found online at portofhoodriver.com. If you have questions about this report or would like additional information, please contact the Port’s Chief Financial Officer Fred Kowell at fkowell@portofhoodriver.com.

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