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Recap of 2024Q2

Analysis

Date Range: April 1, 2024 – June 28, 2024

Executive Summary

During the second quarter of 2024, the Jefferson County Board of Commissioners was forced to confront the consequences of systemic failures in core services, committing hundreds of thousands of dollars to stabilize a collapsed homeless shelter system and manage a severe, self-inflicted permitting crisis. The board’s actions were overwhelmingly reactive, driven by public outcry and operational breakdowns that consumed both political attention and fiscal resources. This crisis-management posture stood in stark contrast to its steady, quiet progress on long-term conservation and infrastructure goals, which continue to be funded almost exclusively by external state and federal grants.

The board’s most critical action was orchestrating an emergency transition for the county’s only low-barrier homeless shelter, approving a new Professional Services Agreement with Bayside Housing for up to $300,000 and committing to an estimated $46,000 in annual facility costs. This decision, finalized in a special meeting, averted a complete shutdown of services but created a significant new, locally funded liability. Simultaneously, the board was compelled by intense public criticism to hold a workshop on the Department of Community Development (DCD), where a permit backlog created by a 2022 land-use law continues to stall construction a full year after the department’s operational collapse.

While managing these internal fires, the board advanced its conservation agenda, supporting a 671-acre expansion of the Dabob Bay Natural Area and awarding $280,000 in Conservation Futures funds. It also imposed an emergency moratorium on new short-term rental permits, a decisive regulatory move to address housing shortages.

Winners this quarter were social service provider Bayside Housing, which secured a major operating contract, and conservation groups that locked in land protections. The losers were property owners and builders stuck in the DCD’s permitting quagmire and county taxpayers who now fund the full cost of both the new shelter contract and the ongoing DCD operational subsidy, while long-term deficits in core services like roads remain unaddressed.

Individual Action Analysis

1. County Averts Shelter Shutdown with $346,000 Emergency Contract

Topic

The board finalized an emergency operational plan for the county’s only low-barrier homeless shelter, approving a contract with Bayside Housing for up to $300,000 annually and assuming direct lease and utility costs of approximately $46,000 per year.

Context

  • Service Collapse: The action was a direct response to OlyCAP’s announcement that it would terminate its contract to operate the American Legion shelter on June 30, leaving the county with no low-barrier shelter and facing legal risks under the Martin v. Boise decision.
  • Consequences of Prior Decisions: The crisis exposed the fragility of the county’s single-provider model for a critical social service. Public testimony in prior quarters detailed poor conditions and operational failures at the shelter, signaling systemic weaknesses long before the operator’s withdrawal.
  • Fiscal Pressure: The new agreement represents a significant, unbudgeted commitment of local funds. The county’s primary funding stream for homelessness, real estate recording fees, had been "cut in half" due to a market slowdown, as noted by commissioners in the previous quarter. The new plan relies heavily on the county’s Housing Fund (Fund 149).

Public Input

  • Who testified: Patricia Hennessey (Jefferson County Food Bank Association), Maggie (homelessness advocate), and Barbara Mori.
  • What they represented: Service providers and individuals with lived experience.
  • Substance of testimony: Testimony at multiple meetings detailed ongoing poor conditions at the shelter, including blocked showers, duct-taped toilets, and rodent issues. Advocates urged the inclusion of people with lived experience in a new policy council and highlighted the need for permanent supportive housing, not just emergency shelter.

Deliberation Insights

  • Crisis Management Mode: The board operated entirely in a reactive mode, scrambling to find a new operator and secure a lease with the American Legion before the June 30 deadline. The process culminated in a special meeting on June 28 to finalize the agreements.
  • Delegation of Authority: To expedite the complex negotiations involving Bayside, the American Legion, and the City of Port Townsend (for permitting), the board authorized Commissioner Brotherton to finalize the Professional Services Agreement (PSA) and other legal documents.
  • Shift in Financial Responsibility: The board accepted a new model where the county holds the primary lease and covers facility costs directly, while contracting for operations. This shifts significant financial risk and administrative burden from the non-profit operator to the county government.

Decision & Vote

Approved a Professional Services Agreement with Bayside Housing for up to $300,000 and an associated MOU and lease with American Legion Post #26. (Approved 3-0 at a special meeting on June 28).

Impact & Analysis

Immediate & Long-Term Consequences
  • Winners: Bayside Housing & Services, which secured a major contract to expand its operations. Unhoused residents, who avoided the immediate loss of the shelter.
  • Losers: The county’s general fund and housing fund reserves, which now backstop a new, ~$346,000 annual operating cost for a service previously managed through a less costly contract.
  • Fiscal Impact: The county committed to a total annual cost of up to $346,000 ($300,000 PSA + ~$46,000 in lease/utility/repair costs). This creates a permanent, high-cost social service liability without a dedicated, stable local funding source.
Strategic Implications
  • Reactive vs. Proactive: The decision was purely reactive, a last-minute rescue of a failed system. It demonstrates a critical lack of contingency planning for an essential service.
  • Budget Trade-offs: The $346,000 annual commitment represents a massive implicit trade-off against every other unfunded county priority, from road maintenance to competitive employee salaries. It consumes a significant portion of the county's discretionary financial capacity.
  • Pattern Recognition: This action reinforces a pattern of the county government stepping in to directly fund or manage services when non-profit partners falter, increasing the scope and cost of its direct responsibilities.
Critical Gaps & Risks
  • What was not discussed: A long-term, sustainable funding plan for the shelter beyond the first year's allocation from the housing fund and recording fees. The board solved the immediate operational crisis but not the underlying fiscal instability.
  • Vulnerabilities Created: The county is now the primary financial guarantor for a complex, high-liability social service. It is vulnerable to cost overruns, operational challenges from its new contractor, and the political fallout from any future failures.

2. Board Confronts Permit Backlog, Commits to No Substantive Changes

Topic

After sustained public criticism from builders and consultants, the board held a workshop on the Department of Community Development's (DCD) permit backlog but endorsed the department’s plan to "stay the course" with no immediate changes to the process.

Context

  • Consequences of Prior Decisions: This workshop is a direct result of the ongoing DCD operational crisis, which began in Q2 2023 following mass staff resignations after the board adopted an unfunded, complex land use ordinance in late 2022. The county is now a full year into managing this self-inflicted failure.
  • Operational Failure: Public testimony on May 6 detailed permit processing times of up to 12 weeks for a preliminary review that was promised in two weeks, and nine-month delays for full building permits. DCD data presented on May 20 showed an average review time of 16 weeks.
  • Housing Crisis: The permitting logjam directly hinders the construction of new housing, undermining the board’s top stated priority. The crisis pits the county’s regulatory ambitions against its practical ability to facilitate development.

Public Input

  • Who testified: Lizanne Coker (Jefferson County Homeowners Association), Sally Lloyds (permit consultant), Mark Grant (builder), and others.
  • What they represented: The coalition of builders, developers, and consultants directly harmed by the delays.
  • Substance of testimony: Speakers described the Site Development Review (SDR) and Legal Lot of Record (LLOR) process as a failure, causing clients to lose financing and driving up costs. They demanded specific changes, including reinstating customer assistance meetings, re-evaluating the SDR process, and prioritizing professional applications.
  • Intensity: Public comment was organized, specific, and reflected deep frustration with the department's performance and lack of transparency.

Deliberation Insights

  • Defense of the Department: Board discussion and staff presentations focused on contextualizing the backlog by citing staff turnover (13 departures in 2022-23), a surge in applications before a code change, and a pending software transition.
  • Alternatives Rejected: The board did not direct staff to implement specific solutions proposed by the public, such as modifying the SDR process or reinstating in-person customer assistance meetings. The staff recommendation to "stay the course" and focus on a July 1 software launch was accepted.
  • Focus on Future Improvements: The board and staff framed the upcoming EnerGov software portal as the primary solution to transparency and tracking issues, effectively deferring meaningful process changes.

Decision & Vote

No formal vote was taken. The board gave consensus direction to DCD to continue its current approach, with a focus on implementing new software. (Workshop held May 20).

Impact & Analysis

Immediate & Long-Term Consequences
  • Winners: DCD staff, who avoided immediate, board-mandated changes to their workflow and received a public endorsement of their current strategy.
  • Losers: Builders, developers, and property owners, who face continued long delays and uncertainty. Their specific requests for immediate process relief were rejected.
  • Operational Changes: No immediate operational changes were implemented. The decision maintains the status quo, placing the burden of the dysfunctional system on permit applicants.
Strategic Implications
  • Reactive vs. Proactive: The workshop itself was a reactive response to public pressure. The decision to "stay the course" is a passive acceptance of a failing system, not a proactive strategy for improvement.
  • Alignment with Stated Priorities: The inaction reveals a deep conflict between the board's stated priority of solving the housing crisis and its unwillingness to reform the primary county process that enables new housing construction.
  • Budget Trade-offs: This inaction has a direct fiscal impact. The ongoing crisis is propped up by a $300,000 increase to DCD’s general fund subsidy approved in the 2024 budget. By not forcing process reforms, the board implicitly accepts this taxpayer-funded bailout as a permanent condition.
Critical Gaps & Risks
  • What was not discussed: Accountability for the board’s own role in creating the crisis by passing the 2022 ordinance that triggered the departmental collapse. The discussion focused solely on DCD’s operational response.
  • Questionable Assumptions: The board accepted the premise that new software will solve what is fundamentally a process and capacity problem.
  • Vulnerabilities Created: By failing to address the core complaints of the development community, the board erodes trust and signals that it is unable or unwilling to fix a critical government service. This damages the county’s reputation and may discourage future private investment.

3. Board Imposes Moratorium on Short-Term Rental Permits

Topic

The board adopted an emergency one-year moratorium on new applications for short-term rental (STR) permits, citing the housing crisis and the proliferation of unpermitted rentals.

Context

  • Housing Crisis: The action was explicitly justified by the county’s 2017 declaration of a housing emergency. DCD Director Josh Peters reported over 400 unpermitted STRs were operating, consuming housing stock that could be used for long-term residents.
  • Regulatory Failure: The moratorium is an admission that the county’s existing regulatory framework for STRs is ineffective and unenforceable. It halts new applications to provide time for DCD to develop a more robust ordinance.
  • Constituent Demand: The action follows years of contentious debate over the impact of STRs on neighborhood character and housing availability, a core tension in a tourism-dependent economy.

Public Input

  • No public comment was offered at the hearing where the emergency ordinance was adopted on April 8. A commenter at a subsequent meeting on April 15 supported the moratorium but criticized the lack of advance notice.

Deliberation Insights

  • Emergency Framing: The board used its emergency ordinance powers to enact the moratorium immediately, bypassing a standard public hearing process. This signals the perceived urgency of the problem.
  • Focus on Enforcement: Deliberations acknowledged that the core problem is widespread non-compliance. The moratorium is intended to provide a pause to develop regulations that are more easily enforceable, likely by requiring license numbers on booking platforms.
  • Acknowledging Capacity Limits: The action is also a pragmatic response to DCD’s operational crisis. The department lacks the capacity to process a surge of new STR applications while simultaneously trying to overhaul the regulations.

Decision & Vote

Adopted Emergency Ordinance 01-0408-24, imposing a one-year moratorium on new short-term rental permit applications. (Approved 3-0 on April 8).

Impact & Analysis

Immediate & Long-Term Consequences
  • Winners: Advocates for affordable housing and residents concerned about the "hollowing out" of neighborhoods by commercial STRs. DCD staff gain a reprieve from processing new applications.
  • Losers: Property owners who intended to apply for new STR permits. The tourism industry, which may see a constrained supply of lodging options.
  • Operational Changes: DCD is now tasked with drafting a comprehensive new set of STR regulations, a complex and politically contentious process that will consume significant staff time.
Strategic Implications
  • Proactive vs. Reactive: The decision is a proactive regulatory intervention to address a long-simmering policy problem. Using an emergency ordinance, however, is a reactive tool to gain control of the situation quickly.
  • Alignment with Stated Priorities: The moratorium directly aligns with the board’s top stated priority of addressing the housing crisis. It prioritizes the need for long-term residential housing over the economic interests of STR operators.
  • Connection to Fundamental Tensions: This action lies at the nexus of several core county conflicts: housing affordability vs. tourism economy, property rights vs. community character, and the demand for regulation vs. the county’s limited enforcement capacity.
Critical Gaps & Risks
  • What was not discussed: A plan or budget for enforcing the new regulations once they are written. The moratorium pauses the problem but does not solve the underlying enforcement challenge.
  • Vulnerabilities Created: The moratorium creates a period of significant regulatory uncertainty for property owners. If the county fails to produce a viable new ordinance within the one-year timeframe, it risks political backlash and potential legal challenges.

4. County Advances Conservation Agenda with Dabob Bay Expansion and Land Purchases

Topic

The board approved a letter supporting a 671-acre expansion of the Dabob Bay Natural Area and awarded $280,000 from the Conservation Futures Fund for two land preservation projects.

Context

  • Environmental Protection: These actions advance the county’s long-standing strategic goals for conservation and environmental protection, which are strongly supported by its progressive electorate.
  • Grant Dependency: The Conservation Futures program leverages a small local property tax levy to provide matching funds for larger state and federal grants, demonstrating the county’s model of using local dollars to attract external investment for conservation.
  • Economic Development vs. Environmental Protection: The Dabob Bay expansion involves transferring state forest trust lands out of timber production and into permanent conservation status. The Trust Land Transfer (TLT) program is designed to compensate school districts and other trust beneficiaries by acquiring replacement timber lands elsewhere, mediating the conflict between logging revenue and conservation.

Public Input

  • Who testified: Representatives from the Northwest Watershed Institute and the Climate Action Committee, as well as several residents.
  • Substance of testimony: Testimony was unanimously in favor of the Dabob Bay expansion, citing the protection of rare rhododendron forests and the alignment with county climate goals.
  • Notable Absences: No testimony was offered from the timber industry or other economic interests opposed to the land transfer.

Deliberation Insights

  • Acknowledging Process Flaws: In a May 20 discussion, the board acknowledged that the Department of Natural Resources (DNR) had failed to conduct proper government-to-government consultation with local tribes before advancing the land transfer proposals, a significant process failure. The board committed to working directly with the tribes.
  • Leveraging Local Funds: Deliberations on the Conservation Futures awards focused on the program's success in using a relatively small amount of local money ($280,000) to help secure millions in outside funding for land acquisition.
  • Unanimous Support: Both decisions were made with strong board consensus, reflecting the high value placed on conservation by all three commissioners and the community.

Decision & Vote

  • Authorized a letter of support for the Dabob Bay Natural Area expansion. (Approved 3-0 on June 24).
  • Approved Resolutions 36-0624-24R and 37-0624-24R, awarding $150,000 to the Tarboo Wildlife Preserve and $130,000 to Humbleberry Farm from the Conservation Futures Fund. (Approved 3-0 on June 24).

Impact & Analysis

Immediate & Long-Term Consequences
  • Winners: Conservation organizations, including the Northwest Watershed Institute and Jefferson Land Trust. The public, which gains permanent protection of and potential access to sensitive lands.
  • Losers: No direct losers were identified. The TLT program is designed to prevent financial harm to trust beneficiaries like school districts.
  • Fiscal Impact: The county committed $280,000 of dedicated conservation funding. These funds cannot be used for other general government purposes.
Strategic Implications
  • Proactive vs. Proactive: These actions are the execution of long-term, proactive conservation strategies.
  • Alignment with Stated Priorities: The decisions align perfectly with the stated priorities of Commissioners Eisenhour and Dean for environmental protection and climate resilience.
  • Pattern Recognition: This continues a decades-long pattern of the county using dedicated local funds and partnerships with non-profits to achieve large-scale conservation objectives that would be impossible to fund through its general fund alone.
Critical Gaps & Risks
  • What was not discussed: The long-term costs of stewardship for these newly protected lands and the county's role, if any, in funding that maintenance once the acquisition grants are spent.
  • Vulnerabilities Created: The failure of DNR to properly consult with tribes on the Dabob Bay transfer created a significant political and legal risk. While the county moved to correct this, it exposed a vulnerability in relying on state-led processes.

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