TACOMA -- A state appeals court decision this week supported the Navy's efforts to block a pit-to-pier project and other structures it believes are incompatible with its mission in Hood Canal.
The Navy operates a ballistic missile submarine base and testing ranges there. Hood Canal Sand and Gravel owns waterfront where it planned to build a 1,000-foot pier where barges would be loaded. The Navy claimed the pier would disturb acoustic and magnetic testing. It purchased a 50-year easement in July 2014 from the Department of Natural Resources for 4,804 acres of bedlands on the west side of the canal that prevents the building of wharves, piers and docks. The gravel company needed a lease from DNR to construct a pier from its property.
The company sued in Jefferson County Superior Court in August 2014, claiming, among other things, that the state didn't have the authority to grant the easement to the Navy and didn't get market value for it. DNR filed a cross motion to dismiss all of Hood Canal Sand and Gravel's claims, which the court did. The company appealed to the state appeals court, which ruled Tuesday that the superior court acted properly.
Hood Canal Sand and Gravel has 30 days to petition the state Supreme Court to take the case, spokesman Dan Baskins said. It has other avenues he didn't disclose.
"I'm not at liberty to speak about it," he said. "We'll take our time to review our options and move forward. We have a month or two to determine what we're going to do next."
The establishment of market value for the easement aroused suspicions. An initial appraisal valued it at $1.7 million. The Navy told DNR it wasn't authorized to acquire land costing more than $750,000 under the program it was using. The Navy recalculated a value of $720,000, which it paid.
Court documents explain what occurred. In arriving at the higher figure, the appraiser estimated the easement would reduce the bedlands' value by 70 percent, the midpoint of six case studies. The Navy would have to pay the state for the lost value.
The Navy determined the most similar case study was one that resulted in a 30 percent decrease in value, which pencils out to a much lower cost to the Navy. It said the bedlands are best used for geoduck harvesting and other low-intensity uses, not the types of development that the easement would prohibit. Bedlands are the area from 18 feet below the average low tide to 70 feet down.
Hood Canal Sand and Gravel argued that as a waterfront property owner, it should have priority rights to lease the bedlands. The three-person appeals panel determined that the Legislature has granted DNR the authority to grant easements to lease the bedlands and that the gravel company was eligible for a lease but not for preferential treatment.
State law "permits DNR to lease bedlands to the abutting owners, but it does not require DNR to do so," the decision states.
A federal lawsuit challenging the easement was dismissed in September.
The Navy in August 2013 applied for a similar restricted easement on the east side of Hood Canal, from the floating bridge south to about Holly. It suspended the application until the lawsuit about the west side was settled.