From the Port of Hood River Winter 2020 Newsletter:
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, 2019. 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 with regard to the Port’s mission and values, and a portion of 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 any 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 fund called the 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, 2019 was $44,444,011, representing a $2,440,053 increase over the prior year.
Table 1 depicts an increase in total assets of $99,386, primarily attributable to the retirement of debt from the tax-exempt bridge bonds and the taxable revenue bond from Lower Mill, while also considering the revenues and depreciation for the operations of the Port.
The largest portion of the Port’s Net Position, at 82%, 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 total of $140,707 represents cash and investments that are legally restricted for debt service related to the marina flex lease debt and a note payable. The 2013 general revenue (bridge) bonds of $480,000 and the 2015 taxable general revenue bond of $1,821,241 were extinguished during the year. Finally, the remaining $7,822,320 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 $2,440,053 or 6% compared to the prior year.
Governmental Activities – The Net Position for governmental activities increased $1,243,194 or 15% from the prior year. This increase is primarily due to higher inter-fund transfers from the enterprise fund to the governmental funds for bridge planning and reimbursements from a State of Oregon grant to fund final environmental impact studies for bridge replacement efforts.
Financial highlights of governmental fund activities for the year include:
• Reimbursements amounting to $1,473,192 from a legislative grant of $5 million for final environmental impact studies for bridge replacement.
• Higher interfund transfers by $705,595.
• Property taxes continue to increase about 4% as projected.
• Higher investment earnings due to higher reserves.
• Personnel cost increases over $153,865 related to additional staff time dedicated to the bridge replacement planning and legislative advocacy.
Business-type Activities – Business type activities generated a $1,196,859 (4%) increase in the Port’s total Net Position. The financial results for this year include a $954,538 increase in toll revenues (19%), reflecting toll rate increases in February, 2018. Bridge traffic showed a 3% decrease over the prior year attributable to multiple bridge closures for maintenance and capital improvements. Lease revenues from industrial and commercial properties increased $379,939 (19%) due to lease restructuring and inflationary growth and a $10,940 recreation revenue increase was due to Event Site season pass rates. Capital grants continued to play an integral role to the Port as $312,280 was received for the North Apron and environmental assessment projects at the airport. The Revenue Fund decreased by $126,014, primarily attributable to a decrease in capital grants for airport projects. Although transfers increased by $705,595, they were offset by increased toll revenues of $954,538. Expenses remained relatively flat overall with an increase of $104,011 over the prior year.
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 64% of operating revenues, excluding grants. Lease revenues and fees continue to improve diversification, with a 95% occupancy rate at year-end. The Port’s development of Lower Mill for future industrial uses will partially offset leasable square foot lost from the Expo Building sale.
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. The Lower Mill site and 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 email@example.com.