Oak Harbor angles for downtown money

Oak Harbor city leaders want $1 million from a fund meant to promote economic development in Island County.

The money, if obtained, would be used to help pay for a $10.6 million project to create “a vastly improved, pedestrian-friendly streetscape” for the downtown, Pioneer Way area, according to the council agenda.

Last week, the Oak Harbor City Council approved the grant application for the 2007 Rural County Economic Development Fund, which is administered by the Island County commissioners. Councilmen Paul Brewer, Jim Campbell and Danny Paggao were absent from the brief meeting.

The fund, often called .08 funds, is sort of a rebate from the state. Counties designated as rural recoup 0.08 percent of sales taxes, which is earmarked “to fund public facilities serving economic development purposes and to promote the creation, attraction, expansion and retention of businesses and provide for family wage jobs,” according to the agenda.

The project to improve Pioneer Way is part of the city’s Windjammer project to improve the downtown and waterfront areas. The city’s consultant, Tom Beckwith, and city planners have worked with downtown merchants to create a plan for a pedestrian-friendly, aesthetically-pleasing “streetscape” design with angled parking on part of Pioneer Way.

Last month, the City Council adopted a project priority list for the city, which listed the improvement to Pioneer Way as the No. 2 priority. Redevelopment of the Oak Harbor Marina is the top priority. City staff didn’t say why — and council members didn’t ask — the city is applying for rural county economic development funds for downtown instead of the marina.

Like all $92 million worth of projects on the list, the main obstacle to funding the $10.6 million Pioneer Way project is money.

Besides the possibility of obtaining the $1 million grant, city Development Director Steve Powers said there is a good chance that downtown property owners would form a limited improvement district, or LID, to help fund part of the project. An LID is a funding mechanism by which property owners would help pay the cost of improvements over time.

Powers said talks with Harborside merchants about the LID are very preliminary, but he said they have expressed enthusiasm to the idea. He said they have talked about raising around $1 million with the LID, but again, that’s very preliminary.

In addition, Powers said the city may be able to use some utility funds to help pay for the project. Those funds come from the fees users pay. The city has to replace aging water and sewer lines under Pioneer Way anyway, so the city hopes to do the streetscape improvements at the same time.

Powers said the city hasn’t yet analyzed how much utility funding can be used for the project, but that the money can’t be used for work completely unrelated to the utilities.

You can reach News-Times reporter Jessie Stensland at or call 675-6611.

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