PORT HADLOCK — A luxury hotel closed by the state in 2011 because of unpaid taxes will reopen this spring as the Bayside Hotel, offering low-income housing for East Jefferson County residents.
“We will be able to offer the services that people need in order to turn their life around,” said John Cantlon, chairman of the board of Bayside Housing and Services, a nonprofit organization formed specifically to transform the property.
“We will give people the tools so they can make a change.”
Cantlon said he hopes the new venture will be open for business 60 to 90 days into the new year.
The Inn at Port Hadlock at 310 Hadlock Bay Road is to be rechristened as the Bayside Hotel and will operate as a hotel and training center where Jefferson County residents can gain access to affordable housing as well as employment and life skills counseling, Cantlon said.
The inn, owned by Suki James of Bremerton, was operated as a luxury hotel overlooking the Port Hadlock Marina and Port Townsend Bay with 47 suites and guest rooms until the state Department of Revenue revoked its business license for nonpayment of taxes.
Four liens for state business and occupation taxes were filed against the inn.
The face value of the liens — which did not include any payments the company might have made — was $152,208.
James said in July 2011 that she had paid at least $43,500 on her bill. She wasn’t sure of the exact amount.
The foreclosed property was sold to Inn Properties LLC of Port Townsend on Dec. 14 for $852,000, according to the Jefferson County Assessor’s Office.
The new owners are leasing one portion of the property to Bayside for an undisclosed amount.
Those seeking to enter the Bayside Hotel program will be referred from Olympic Community Action Programs, Dove House Advocacy Services for survivors of domestic violence and sexual assault, Jefferson Healthcare hospital or another agency.
Rents will be calculated at 30 percent of tenants’ adjusted income, as it is with a standard low-income housing projects.
Tenants can check in for 28 days at a time. After that period, each tenant’s status will be re-evaluated. If he or she still qualifies, he or she can check in for another 28 days, Cantlon said.
Those who do not qualify for the program will be able to rent space at market rates, Cantlon said, which has not been determined.
The venture has close ties to other local homeless services. Bayside board members Cantlon, Kim Hammers and Vince Verneuil also serve on the board of the Community Outreach Association Shelter Team (COAST), which operates the Port Townsend Winter Shelter.
Another COAST board member, deForest Walker, has been hired to manage the new hotel.
The Bayside will occupy one of the inn’s two buildings.
The main building — which contained the reservation desk, restaurant and bar, meeting rooms and 14 high-end hotel rooms — is not part of the new venture.
Bayside is leasing the space from the owners of both buildings: Inn Properties LLC, a Port Townsend company with a post office box as its only contact and whose corporate office is listed with the state of Washington as 1239 Water St., the local U.S. Bank office.
Cantlon said he did not know what the new owners would do with the main building.
The new facility will locate in the adjacent building. It has 33 rooms along with meeting rooms and a restaurant.
Twenty of the rooms are regular hotel size, while the remainder are slightly larger, Cantlon said.
They are all furnished and include a 1,200-square-foot penthouse.
“When the former owners left, everything was in great condition, and the beds were all made,” Cantlon said.
Each room contains a mini-fridge and a microwave to allow for limited food preparation. Food also will be available at the restaurant, which will provide job opportunities for residents.
The restaurant will be open to the public and could provide revenue for the operation, Cantlon said.
Some of the rooms, including the penthouse, will be rented out at fair market value and used to subsidize the operation, Cantlon said.
The new facility will provide those in need with more than an inexpensive place to live.
Cantlon said residents will get job training as well as “life training,” since many potential clients have never been taught how to exist in the modern world.
“They have never been taught any life skills,” Cantlon said of the potential client base.
“A lot of them go to the store every day because they don’t know how to plan ahead and shop for a month at a time.”
Cantlon said he expects to draw several program participants from Irondale, a neighborhood a few miles west of the facility that has a large share of substandard homes and poverty.
Cantlon said he visited a woman whose five-room house was a mess and encouraged her to clean one room a day.
“The house would be clean in a week, and she’d still have two days to kick back,” he said.
“But they get into situations where their whole world is spinning out of control.”
Cantlon said he’s heard of cases where girls become pregnant as young as 13, adding that if that cycle continues, they could have grandchildren before they turn 30.
Cantlon projects a $375,000 yearly budget with income coming from rents, subsidies and grants, although those sources will not be available during 2015, which will probably have a shortfall of about $150,000.
The proposal to use the former luxury hotel for a more practical purpose has been in play for more than two years, with the biggest obstacle clearing the title to the property.
“There have been title issues concerning this property since 1913,” Cantlon said.
“I have no idea how the previous owners got any financing.”
The site first hosted a wood distillery plant in 1911 and was constructed to convert sawdust into alcohol and bastol, made from a mixture of sawdust and cattle feed.
The effort never profited, and the plant closed just two years later.
The building sat vacant until 1968, when the late John R. Hansen of Port Hadlock purchased the property and planned to operate it as a resort marina.
This did not come to fruition until 2006 with the opening of the Inn at Port Hadlock, purchased by James for $3.7 million.
Board member Hammers said the low-income hotel is unique.
“Nothing like this has been done or thought of in this county, and it will become a template to be shared across the country,” she said, calling the venture “a glorious example of compassion and humanity.”
“We are all here on this Earth to care for one another. It is as simple as that,” she said.
For more information, call 360-344-2122 or email baysidehousing@msn.com.
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Jefferson County Editor Charlie Bermant can be reached at 360-385-2335 or cbermant@peninsuladailynews.com.
