State Plans to Lease Puyallup Hatchery Do Not Pass the Sniff Test with Local Representatives

*(Update: Word came in after press time that the Department of Fish and Wildlife has suspended lease talks with Pacific Seafood following concerns raised by lawmakers and citizens about the deal and what it would mean for the hatchery. A meeting is now set for 8 a.m. Monday, June 4, at Puyallup City Hall to ponder the creation of a nonprofit or other such partnership that would operate the hatchery, which currently produces some 270,000 trout bound for lakes around Puget Sound sport fishing.) *

Plans for the state Department of Fish and Wildlife to lease a trout hatchery on a tributary of the Puyallup River to a for-profit seafood giant is raising questions with some elected officials and the Puyallup Tribe. The state would be paid in trout instead of money under the proposed 50-year lease, negotiated in secret without public disclosure or competitive bidding.

“Something smells fishy here, and it is not the trout fingerlings,” said State Representative of the 25th District Bruce Dammeier.

Bruce Dammeier’s district includes an area around the Puyallup hatchery on Clarks Creek. He feels the lease, or any deal involving the leasing of a public asset like a hatchery, should have been discussed with every stakeholder before a contract was even drafted, let alone negotiated to the point of seeking formal approval.

“I appreciate the difficult position the Department of Fish and Wildlife is in, but there are a lot of options that could have been brought to the table,” he said. “We have to leverage the best options as possible to get the best outcome, and I don’t think that has happened.”

The proposed deal would turn over operations of the Clarks Creek trout hatchery from the state to Pacific Seafood, an Oregon-based seafood processing company. Pacific Seafood is the largest seafood operation of its kind in the nation, with more than $1 billion in annual sales. Pacific Seafood employs some 2,500 people at 37 processing plants and distribution facilities in seven states.

The private, family-owned company would “pay” for the facility by providing the state with trout during the 50 years covered by the deal. The actual trout-as-lease-payment numbers instead of periodic, cash payments have not been determined.

Bruce Dammeier believes other options could have been explored, or at least discussed with the state, tribal, local and nonprofit groups that have interest in the hatchery operations since it is an educational, recreational and economic center for the greater community. He specifically is troubled that the Puyallup Tribe of Indians, which has its own fisheries operations along the river system, was left out of the conversation.

“The ‘how’ we got here is not how I believe a state agency should behave. The answer to ‘why’ we were not notified about this has not been answered to my satisfaction at all.”

Dammeier and fellow 25th District officials, Senator Jim Kastama and Representative Hans Zeiger, have written a letter to Fish and Wildlife Director Phil Anderson with a list of concerns they have about not being informed about the pending contract.

The department has stated the 70-year-old hatchery needs some repairs totaling about $2 million, money the dollar-strapped agency does not have. Fish and Wildlife’s slice of the state’s general fund has dropped 40 percent since 2009. And its $350,000 annual operational costs of the Clarks Creek hatchery could be saved under the deal without lowering trout production. Recently the state has been using the hatchery solely to produce trout that are distributed for recreational catching in lakes around the South Sound. The state’s trout rearing would move from Clarks Creek to a facility in Lakewood, for a net gain of trout production once the Pacific Seafood numbers are added.

The elected officials, however, point out wildlife officials did not ask for money to repair the hatchery in the last budget and that a bill to privatize trout production died in the Legislature just a year ago but a lease agreement concerning Clarks Creek apparently continued without discussions with lawmakers or other agencies.

“In the case of Puyallup, we ask that any discussion of closing or selling the Puyallup Fish Hatchery be very well vetted with us and with the local community,” the letter stated, noting that the Puyallup Tribe specifically should be involved.

A concern for the Puyallup Tribe is the fact that part of the federal land claims settlement involved the Tribe paying for construction of a major part of the hatchery in exchange for the state’s promise to use it to increase annual Steelhead production on the Puyallup River system from 100,000 to 200,000. The Tribe has approached the state to buy the hatchery but the discussions went nowhere; more recently the Tribe asked about leasing it for Steelhead production instead of trout, but the state rejected that idea, saying the state only wanted lake trout to stock lakes for recreational fishing. Even if the state required a private operator to only produce trout at the hatchery, this deal – any deal – at least should have been a matter of public negotiations rather than a no-bid contract of a public resource like Fish and Wildlife officials did with Pacific Seafood, tribal officials said. That is especially true when wildlife officials had been apparently telling legislators and Tribal officials no such deal was even in the works.

Details of the proposed lease could be up for discussion at a Fish and Wildlife Commission meeting on June 2 and will involve public testimony before a final vote, but the final vote could occur at the same commission meeting. Bruce Dammeier, however, feels that the lack of transparency in the contract talks so far have degraded public trust in the agency that it will take a long time, and lots of details, to address concerns he has about the lease. Getting answers to those questions could now involve the governor, the county executive, the state Legislature, community groups, local governments, the Puyallup Tribe and concerned citizens because of the level of distrust news of the pending deal created.

“It is very difficult to put that genie back in the bottle,” he said.

Fish and Wildlife Hatcheries Division Manager Heather Bartlett said the department received $67 million during the last legislative session for hatchery improvements around the state. That list includes the Clarks Creek facility. Lawmakers also gave the department the directive to find short and long-term ways to produce more fish with less money, and the department has some $150 million in needed hatchery repairs. Pacific Seafood would pay for the renovations to the Clarks Creek hatchery under the 50-year lease as well as produce trout for the state in lieu of lease payments. That would mean the state gets fish for less cost than if it ran the hatchery itself, exactly what the Legislature asked the department to do.

“We have to see a net benefit to the citizens of the state,” Heather Bartlett said.

The details of those benefits have yet to be worked out since discussions continue.

“They are still early,” she said. “But they are concrete enough that we felt we needed to brief the commission.”

The question for many is whether a “net benefit,” obtained in negotiations without public involvement or competitive bidding, will result in the maximum public benefit from a valuable public asset.

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