Winter 2004
Economic Evolution
by Seamus Burke
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At the end of Harris Avenue past the Alaska Ferry Cruise terminal, several black and white photos hang in a corner office of a gray weathered building. Rob Costello, dock master and general manager of Fairhaven Shipyard, points to a photo of an old dock house that extended over Bellingham Bay. The same dock house still stands there now, 100 years later.
The scene around the bay today reflects more than a century of history and a perpetually evolving assortment of industry. There is more to Bellingham’s industry than gravel parking lots and chain link fences, cement gray silos and cracked pavement.
In recent decades, society has begun to accept that local resources are not limitless. Companies in Bellingham are beginning to adapt to this change in consciousness as well as the reduction of available resources. Fisheries on Harris Avenue are no longer packed several feet deep with salmon, nor is the northern end of the bay jammed full of timber.
Costello, a life-long resident of Bellingham, recalls the days when the whole town used to smell like sawdust and wildlife was a rare sight in the bay.
“I think the bay has become substantially cleaner,” Costello said. “I think it’s all for the best, too.”
A National Oceanic and Atmospheric Administration ship was dry docked at the Fairhaven Shipyard on a cold and drizzly February day. Underneath it, a worker in full rain gear stood pressure washing the hull. The shipyard works on NOAA ships as well as ships from the Coast Guard, U.S. Navy, Alaska ferry lines and personal yachts, and employs up to 150 people. The shipyard closed down briefly in early 2002 because of management problems. Costello and Roger Hegwald, also dock master and general manager, began working hard in May 2002 to get the company back on its feet.
“There were times when we regretted coming back in here,” Costello said. “We took some crazy jobs just to sustain.”
Most of those jobs were routine maintenance and repair. Occasionally, however, the company took other jobs, such as hauling sunken boats up from the bay floor, Hegwald said. Once, workers pulled a sunken boat off the floor that was so old and decayed that just as it reached the surface its hull snapped in half, causing it to crash back into the water, he said.
“We went from one boat job to one boat job,” Hegwald said. “It was exactly like living from paycheck to paycheck.”
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Ken Durland is lean manufacturing manager at Mt. Baker Plywood. |
Today the shipyard usually has seven or eight projects going on at once, Hegwald said. The volume of work, however, isn’t the only thing that has changed about their operations. The Fairhaven Shipyard site has historically violated pollution standards, according to the Washington State Department of Ecology.
Zinc and copper from paint and arsenic contained in sandblasting materials have been the largest concerns. In a sampling done in February 2002, these pollutants exceeded allowable releases under Ecology’s Sediment Management Standards criteria. The company has since installed catch basins along the edges of the property to catch any run-off headed toward the bay. They also use tarps to trap airborne particles while they repaint ships, and do not use paint that contains zinc or copper anymore, Hegwald said.
According to a February 2004 study by Ecology, the current environmental activities of the Fairhaven Shipyard are heavily regulated and are not likely to recontaminate the sediment.
Increased environmental regulations have been another challenge the partners have faced while managing the shipyard.
“They’ve been expensive, but they’ve been fair,” Costello said. “We’ve only got one planet, we’re either going to take care of it or we lose it.”
One morning before sunrise, a lone fishing vessel made its way to the docks next to the Fairhaven Shipyard. Nearly a dozen men in bright yellow rubber overalls scrambled around on the slick wooden dock setting up in preparation for the catch. As the ship tied up, a large yellow and black crane whirred into position, dangling a trash-can-sized metal bucket from its end. The four-man crew aboard the 40-foot long liner threw open a trap door and began loading frozen bloodied fish into the bucket. The scene is indicative of the times. One 40-foot boat full of dogfish — only enough work to keep the processing crew inside busy for two days — is a big change from Bellingham’s fishing past, said Tony Blore, vice president of production and plant manager at Arrowac Fisheries.
“Gone are the days when American shores received 50 percent of the salmon catch (worldwide),” Blore said, “The fishing industry is never going to be what it was 20 or 30 years ago.”
Arrowac operates on the same docks that Pacific American Fisheries, once the largest salmon cannery company in the world, owned until the 1960s.
Arrowac has been in business for about 30 years, Blore said. Recently, however, they cut wages, reduced the work force and reduced their hours of operation to save money. Just to stay in business, the company has had to venture into new, more versatile markets. After measuring, weighing, cleaning and filleting the dogfish, Arrowac sent them to fish and chip shops around London, Blore said.
Industry’s future on the bay is uncertain. Increasing lease rates from the Port of Bellingham and diminishing fish catches are squeezing the wallets of local processors, Blore said.
“At times I feel the port doesn’t look at the industry now the way it has in the past,” Blore said. “I think there’s an opportunity to have industry and commercial retail and tourism on the bay.”
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The reverberations from the shrinking fishing industry are embodied in the warehouses of Bellingham Cold Storage. The company, which has been in Bellingham since 1946 and employs about 150 workers, has had to diversify to stay profitable.
Bellingham Cold Storage has run into the same problems as Arrowac. The company can no longer depend on the abundance of a single resource to maintain their business. Shelves once stocked with raw, unprocessed goods from fisherman and local farmers are starting to fill up with a variety of other foods, such as frozen pizza and lasagna, said Stowe Talbot, owner and vice-president of Bellingham Cold Storage.
“Since the 1990s, to be located in Western Washington has been a challenge for us,” Talbot said. “So we’ve had to find our niche.”
Along with the fishing industry, lumber and production have long been two of the largest industries on Bellingham Bay, according to a Whatcom County study. Some of the sawdust that Rob Costello smelled as a child in Bellingham might have come from the 75-year-old lumber mill site where Mt. Baker Plywood exists today.
According the Washington Department of Natural Resources, today only 54,400 acres of old growth forests exist on Washington State trust lands — land the state uses to create revenue for public schools and other projects. Paper and wood product companies are under increasing pressure from environmental advocates to protect what is left of these forests. Mt. Baker Plywood has become Smartwood Certified to ensure this protection.
Smartwood certification ensures that the wood the company uses comes from designated plantations and not clear cutting or old growth forests. Some wood is shipped from British Columbia and Southwest Washington, but it also comes from as far away as Australia, said Ken Durland, lean manufacturing manager. Smartwood certification is one way Mt. Baker Plywood operates differently than lumber mills of the past.
“We don’t dump anything into the bay, which is different from 50 years ago,” Durland said. “Even in the last 10 years we’ve changed our business from peeling logs and doing skins to focusing on what we do best, which is assembling plywood.”
Instead of processing large amounts of raw timber, the company has found its niche in high-quality, low-volume production. Since 1990, the number of hardwood plywood companies has declined from more than 120 nationwide to fewer than 20, Durland said. With so few companies, Mt. Baker Plywood is able to sell its product in markets from Arizona to Connecticut, achieving $5 million to $10 million in annual sales, he said.
“We like it here, it’s a good workforce,” Durland said. “We’ll just try and grow in our niche a little more.”
Some of the industries that were in Bellingham 100 years ago are still here, but they have adapted to the times. These businesses haven’t completely changed what they do but rather how they do it. Lumber and fishing are still important around Bellingham Bay, but the scale and method of production has evolved. Mass production is no longer the norm. Companies are specializing to meet consumers’ demands while trying to deal with current environmental conditions. Industry must, by its nature, have an effect on the environment, but that effect doesn’t always have to be negative. Mt. Baker Plywood and Fairhaven Shipyard, for example, are working toward the goal of giving consumers what they need while still leaving resources for future generations.