Port of Olympia commission approves settlement over disputed land

The Port of Olympia commission unanimously approved a proposed settlement with the state Department of Natural Resources on Monday, taking a step toward ending an 18-year dispute over ownership of land near the Port Plaza.

The settlement now heads to Peter Goldmark, the commissioner of public lands, who is expected to approve the agreement by April 5, said Heather Burgess, the port’s legal counsel.

On Monday, Burgess explained the history of the dispute — and the history of the area — and touched on some terms of the settlement.

Two buildings stand on the disputed land: Anthony’s Homeport restaurant and the office building just north of it, which is owned and occupied by commercial real estate company The Rants Group.

In 1998, the port and DNR entered into an uneasy agreement to allow development of those buildings. Letters exchanged in 2008 resolved nothing. In 2015, the sides agreed to mediation to avoid litigation.

The mediation before retired Thurston County Superior Court Judge Tom McPhee resulted in a preliminary agreement on Feb. 9.

The port commission was set to vote on the matter late last month, but a few details needed to be worked out, which delayed the vote first to March 14, then to Monday’s meeting.

Some of the settlement terms:

▪ The port will transfer title to the land to DNR, but the port will continue to manage it.

▪ The port will pay a portion of the ground rent it collects for the two buildings to DNR — about $35,500 annually. Over the life of the leases, through 2047, it will total $1.57 million.

▪ DNR will waive all claims to back rent.

Rants Group President and Chief Executive Pat Rants told the commission Monday that he appreciated the work of port staff on the settlement, but shared some concerns. He said he has a 50-year ground lease with the port — with a 30-year option to extend it — but now he may have to deal with the port and DNR on the lease.

“That’s just not what we signed up for,” Rants told the commission. “We want to deal with the port and were hoping that would continue.”

But the commissioners and Burgess reassured Rants that his agreement with the port will be largely unchanged.

“The terms and conditions of the settlement incorporate the existing lease terminology,” Burgess said.

Commissioner E.J. Zita said the port values tenants and developers like The Rants Group.

“We have confidence this is the right way to go, and that our interests and your interests are protected as well as we possibly can,” Zita said about the settlement. “We look forward to working with you to our mutual benefit.”

The disputed land was once part of Columbia Street until it was vacated by the city of Olympia in 1924. The port purchased the property from Georgia-Pacific in 1967.

This story was originally published March 29, 2016 at 8:37 AM with the headline "Port of Olympia commission approves settlement over disputed land."