Port to pay Farm renters' back taxes

Port of Coupeville commissioners Wednesday shot down an attempt by Port consultant John Coyne to recover leasehold taxes from Greebank Farm tenants that were not included in their lease agreements.

When Coyne discovered the Port was not collecting taxes on its leased agricultural land at Greenbank Farm, he sent a letter last month requesting two years back taxes from the tenants, Dick Whittick and Alf Christianson Seed Company, for $554.68 each. The letter also said the tax would be included in the leases from now on, and that the Port would advise them if there were any state Department of Revenue late payment penalties.

Coyne’s action was not discussed at any prior Port meeting, and did not have board approval.

Commissioner Benye Weber called foul on Coyne’s move, and she had done her homework. Neither of the leases mentioned paying the tax, and she found agricultural land rules officials in Skagit, San Juan, and Whatcom counties did not support the lessees paying the taxes.

“It was our mistake,” she said. “They felt we should bear the burden.”

Coyne tried to defend his action by citing a state law, which he included with the letters, that said if the lessor did not pay the taxes the lessee was obligated to pay.

The commissioners unanimously dismissed that line of reasoning.

“We screwed up,” Commissioner Ed Van Patten said. “We will pay the taxes.”

Laura Blankenship, Greenbank Farm executive director, said both lessees felt the request was unfair, and that they were already paying top dollar for the land.

The seed company leases 8.5 acres, while Whidbey Island Alpacas leases 10 acres.

Alpaca owner Whittick has not had a smooth ride with the Port. He has been waiting close to six months for the Port and Greenbank Farm to reach an agreement so he can build a fiber processing mill in barn number two at the farm. When it didn’t look like contract negotiations would be wrapped up by December, he proposed using the front of the barn for a small retail space. The Port commissioners declined to approve that, saying they wanted to get the contract done first.

Although the Port commissioners paid $200,000 to remodel the barn for occupancy, they have yet to complete an agreement that would free up the space for commercial use.

Whittick, who was not present at the Port meeting, was pleased with the outcome of this back taxes request.

“I think it was an appropriate response,” he said. “I negotiated the lease in good faith, and was surprised to find they wanted to change it half way through.” Whittick has a three year lease, with a three year renewal option.

In other business, the Port commissioners made no progress on lease negotiations with the farm group in the last month. Port negotiator Van Patten said there just wasn’t a time when he and the two Greenbank Farm negotiators, Clarke Harvey and Tom Baenen, were available.

The three will meet Dec. 17, but that means no action can be taken until the Jan. 14 Port meeting.

The need to renegotiate both the farm group management contract and lease agreement was spurred by the promise of $1.5 million in capital project funding from the state. The money comes with a stipulation that the farm management group has a 10 year lease with the Port.

Although there is not a deadline, Blankenship said if the two sides can’t reach an agreement the state could rescind the money.

The Greenbank Farm capital project proposal would rebuild another barn on the site, and add improvements to enhance the economic opportunities for island businesses.

The Dec. 10 meeting was the last meeting for Commissioner Mike Canfield, who is stepping down after six years on the board. He will be replaced by Bruce Bryson, who will take the oath of office before the January Port meeting.

Following the meeting Canfield was toasted with champagne and soft drinks.

He said his time on the Port commission has been very rewarding.

“We’ve accomplished a lot,” he said.

“MIke’s most memorable accomplishment is beating down the state and accomplishing (the remodeling of) the wharf,” Van Patten said.

Canfield agreed that was his best achievement, but he expressed disappointment that the farm lease situation was not settled before his tenure ended.

“I came on in 1996, and inherited the farm,” he said. “I’ve done my best to support it since. I’ll be happy to see it go through.”

Canfield said he and his wife Stella plan on doing more traveling, starting with a trip to Bulgaria for Christmas this year.

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