Early this month, some 250 Port Townsend arts patrons converged on the stately old Wheeler Theater at Fort Worden for a concert of Brazilian guitar. The ovation acknowledged a splendid performance, but also a collective sense of relief at the return of a local and regional arts culture that had been teetering toward financial meltdown.
Perched on its peninsula at the entrance to Puget Sound, Port Townsend is deeply dependent on the arts – dozens of nonprofits engaged in music, dance, poetry and more. The arts lure more than a million visitors a year to Fort Worden, the Army fort and state park turned cultural Mecca.
The park has been home to what seemed the perfect marriage between facets of the local culture – arts and a campus filled with handsome, historic Victorian homes and performance venues clustered around the central parade ground.
But, even before the Covid pandemic, those legacies were colliding. And that conflict came to a head two years ago as the Fort Worden Public Development Agency (PDA), which in recent years has managed the arts complex, rental rooms and eateries, tumbled into virtual bankruptcy.
Port Townsend owes its hometown state park to the military, which some 130 years ago fortified the entrance to Puget Sound. In the 1950s, the Army pulled out and transferred the site to the state, which first used it as a home for troubled girls, then made it a state park – 432 acres of woodlands, beaches and campgrounds surrounding some 70 mostly-wood frame structures left by the Army.
Inspired by the possibilities for the theater and other venues, the late Joe Wheeler and other local arts patrons founded Centrum, a nonprofit set up to promote the arts. State Parks provided the historic buildings, and Centrum filled them with concerts and workshops ranging from acoustic blues and fiddles to a Seattle Youth Symphony camp and an annual writers conference.
Other nonprofits followed suit – the Port Townsend Marine Science Center, the Copper Canyon poetry publisher, Northwind Art, a woodworking school, dance studio, and much more. Summer at Fort Worden became a bustling musical smorgasbord – blues music one week, ukuleles the next, interspersed with modern dance, symphony and classical string quartets.
Port Townsend was being transformed from a sleepy mill town to a Mecca for artists and affluent retirees who flocked to Centrum concerts, wrote checks at the annual fundraisers, and volunteered as ticket-takers and parking attendants.
But there was a structural problem. The arts were not paying their way, and that problem gurgled to the surface as the Parks budget was slashed during the recession of 2008-10. For years, the state had charged modest rent for the auditoriums and housing, while paying millions each year to heat and maintain them. Park rangers had little incentive to manage hundreds of housing units efficiently, since they’re trained to maintain campgrounds and trails, not concerts or food service or housing.
Something had to give. So, the city and state agreed to do what Seattle had done with the Pike Place Market. They created the Public Development Authority to work like a private business, able to charge market rates for hospitality services to offset the costs. In 2014, the Fort Worden PDA took over management of the built portions of the park, its mission to promote a “lifelong learning center,” focused on the arts.
Dave Robison, a former city planner and founding director of the nearby Northwest Maritime Center, came on as the executive director. He raised millions in private and public grants, hired staff and began rehabbing a few of those buildings. The long-neglected guardhouse became a pub which quickly became a destination watering hole. Peninsula College, based in Port Angeles, spent $6 million converting a century-old office building to classrooms.
The PDA had still grander ambitions to rehab a cluster of buildings northwest of the parade grounds to create “Makers’ Square,” housing existing nonprofits, the community-owned radio station, and a new culinary arts school. The price tag, however, quickly soared to $13 million with the costs of new sewers and utilities, seismic retrofits, handicapped access – all within the costly constraints of historic preservation.
Robison found himself in the unpopular role of landlord to the cherished, budget-pressed nonprofits, negotiating rental fees that could offset his mounting maintenance costs. The challenge, Robison said at the time, was to get “heads in beds” – thousands of students, artists, and visitors paying for rooms, cocktails and meals to balance the books.
It worked for a while, peaking in August of 2019 when the PDA hosted “THING,” a three-day private music festival that put hundreds of heads in beds. The Seattle Theater Group, which sponsored the event, promptly signed up for another in 2020.
But business-minded observers, including friends of Robison and the PDA, worried that low rental rates were not keeping up with the week-to-week costs of housekeepers, cooks, waiters and administrators needed to keep it going – not to mention millions of dollars for maintenance.
Then came the Covid pandemic. By mid-spring, 2020, it was clear that there would be no THING, no heads-in-beds for at least a year. The PDA cut staff and costs but decided to finish the costly Makers Square project. It got worse. While Centrum and the other nonprofits got federal relief funds, the PDA’s unique organizational status caused it to drop through cracks in the federal-relief rules.
Meanwhile, the Port Townsend Leader, the local weekly, glommed onto the PDA story, suggesting a scandal caused by mismanagement, if not malfeasance. Repeated stories fed the Covid-masked gossip across town, fueling fears of financial collapse.
The turmoil led to a series of reports from the State Auditor’s office, which concluded that a former PDA chief financial officer had written checks totaling $10,054 to a defunct construction company owned by her husband. The CFO resigned and the case was turned over to the local prosecutor (no charges yet).
But the PDA’s financial woes ran far deeper than one officer’s allegedly sticky fingers. The state auditor concluded that the PDA failed to monitor its staff and finances, had dipped into capital funds to pay operating costs, that financial reports were “unreliable.” At the end of 2019 – weeks before the pandemic hit – the PDA was deeply in debt, with only enough cash to operate a few more days.
Robison retired in 2020, replaced by Dave Timmons, the former Port Townsend city manager. Over the intervening months, Timmons has slashed the PDA staff while working with the city, State Parks, Centrum and the other nonprofits to refinance the debt.
What went wrong? The PDA’s fate can be traced back 50 years, when the city and state agreed that Fort Worden should focus on nonprofit arts and education rather than a potentially profitable conference center. Nonprofits “should do all they can to pay for themselves,” says Scott Wilson, Centrum board chairman and former publisher of The Leader. But when they fall short, there is fundamental public interest in stepping up to fill the gap.
In retrospect, the PDA probably took on an impossible task, says David King, the former mayor. “The PDA never reached a place where they could do what they were asked to do.”
Startups, public or private, are prone to the same pitfalls, Timmons adds. “The challenge was to know when you need to pivot from startup to operating, and they didn’t make that shift.”
In recent weeks, Fort Worden has been thoroughly reorganized. Housing and eateries have been turned over to a new private non-profit, Fort Worden Hospitality, freeing the food and beverage from legal restraints that hampered the PDA. (“How does a public agency justify buying scotch by the case?” Timmons asks.)
Both entities will be subject to the original contract and long-term lease with State Parks, which retains control of the beach and the looming bluff called Artillery Hill. Other constraints remain. The buildings are landmarked (and quite old), and there is a besetting lack of hierarchy among that various jurisdictional layers. Not to mention to the vagaries of small town politics, a Port Townsend specialty. The cash-strapped PDA, now under an all-new board with stronger business expertise, will continue to manage the physical campus, including relations with the nonprofit tenants.
To some townsfolk, it looks like rearranging the deck chairs aboard the Titanic. But insiders believe that, at least in the short run, they can make it work. Barring another Covid surge, Centrum plans a full slate of music camps and concerts. The THING festival plans to come back in August. The guardhouse pub hopes to reopen in May. Reservation phones are ringing. The PDA has begun to renegotiate leases with the arts groups. “The key is certainty,” says Wilson. “Timmons knows how to negotiate long term leases.”
But there remains uncertainty around the costs of heating, maintaining, and upgrading some 70 aging buildings.
In the short term, at least, the state will fill the gap, says Peter Herzog, deputy State Parks director familiar with the issues. Arts and education were never going to pay for themselves, regardless which entity is in charge, he says. “Food and beverage and housing support themselves, but not the buildings.”
With booming real estate values and retail sales, State Parks is flush with tax dollars and can afford to step up in the short term. But what happens when the next recession guts the state budget?
Nobody was worrying about that the other day at the Wheeler Theater. Folks just wanted to hear some extraordinary guitarists and look forward to a summer of fiddle tunes and acoustic blues.