Round 2 offer Harbor Bond Portfolio Table of contents Cover letter 3 Quality jobs 4 Award-winning recyclers 5 Environmental commitment 5 Decreased transportation 7 Site well-suited 8 Into the future 9 Appendix A: Letters of support 10 Strategic Materials Inc 10 J.A. Jack and Sons 11 WestRock 13 Ardagh employees 14 Cover letter June 24, 2019 King County Council 516 Third Avenue Seattle, WA 98104 RE: Harbor Bond Portfolio lease - Round 2 offer Preserving manufacturing jobs in Seattle and King County Dear Executive Constantine, Honorable Members of the King County Council, and Kidder Mathews: We have responded to the Kidder Mathews’ and their approximately 60 employees lost their invitation on behalf of King County to revise jobs, that tells only a small part of the story. We and resubmit our competitive offer to lease must emphasize that should this property attract approximately 17 acres of industrial land in South a distribution and warehouse space to take over Seattle, known as the Harbor Bond Portfolio. the site, our entire manufacturing operation on the neighboring property that we own and the In this offer, we respond to Kidder Mathews’ approximately 340 family-wage jobs that depend additional requests. While the invitation requires on it would be at risk. Also at risk are hundreds of bidders to respond to terms that are rigidly specific local jobs at businesses that serve our plant and to the parcel for lease, it overlooks the degree to employees. (See attached letters of support from which the current use of the site is integral to our three of our neighboring vendors.) overall operation and the substantial benefits its current uses provide to King County, the economy In addition to the enormous value our manufacturing and the environment. operations bring to the local and state economy detailed in our previous submission, we would like The Harbor Bond Portfolio cannot be viewed in to expand on the benefits related to glass recycling, isolation without consideration of the neighboring our company’s commitment to compliance with associated uses. While it would certainly be environmental regulations, and the reductions in significant if our subtenants, whose businesses are transportation emissions resulting from our use of located on the leased parcel, were forced to close the site. Harbor Bond Portfolio - Round 2 offer 3 We also want to share with you the physical over family-wage manufacturing runs contrary to conditions and logistics that make the leased site King County’s own principles. ideally suited to our needs and not suited to other uses, especially a warehouse and distribution center. In the Economy section of the King County Executive’s Regional Planning Benchmark Program, Quality of jobs over quantity of jobs King County calls out promoting family-wage jobs as The second-round bid solicitation calls out “jobs Also, the King County Comprehensive Plan, updated created and sustained over lease period” as one October 29, 2018, calls out the importance of of the weighted criteria for selection. If the sheer preserving industrial and manufacturing properties: number of jobs is the county’s priority, this would be a worthy standard. But prioritizing lower-wage jobs a desired outcome and key performance indicator.1 “King County shall encourage redevelopment of and reinvestment in industrial and manufacturing properties by collaborating with other jurisdictions and the private sector to remove, revise, or streamline regulatory or other redevelopment barriers without compromising environmental standards or quality. This includes assessment and/or remediation of contaminated properties” (ED 204, page 10-8).2 Ardagh pays hourly employees an average of $28 per hour at our Seattle plant, compared with the average $16 per hour paid to distribution center workers. With union-negotiated benefits, our employees earn an average of $90,000 a year. Our hourly production workforce is 100 percent unionized across four different bargaining units. We are proud of our collaborative relationship with the unions, while many warehouse workers across the country seek union protections.3 1 King County Executive’s Office. (n.d.). Performance Strategy Budget. Retrieved from King County: 2 King County Office of Performance Stratgey and Budget. (2016, updated October 29, 2018). https://www.kingcounty.gov/depts/executive/performance-strategy-budget/regional-planning/benchmark-program/Economy/EC01_RealWages.aspx Comprehensive Plan 3 ‘We are not robots’: Amazon warehouse employees push to unionize. (2019, January 1). The Guardian. Harbor Bond Portfolio - Round 2 offer 4 Our commitment to our employees leads to a sense Washington State Recycling Association. For the of belonging in the community, and a desire to give last two years, our Seattle plant hosted a tour for the back. A few of the many organizations we have Washington State Recycling Association Conference supported over the years include the White Center trade show to demonstrate how glass is recycled and Food Bank, Environmental Science Center, Ryther (a show off the glassmaking process. child and teen mental health and addiction center), Domestic Abuse Women’s Network, and United Way By using recycled glass, we are reducing our of King County. greenhouse gas emissions by approximately 30 percent. And because our product is 100 percent Lower-wage jobs would create a barrier to recyclable, we can repeat this cycle indefinitely. employees living in King County. If they cannot afford to live here, the value of those jobs decreases We take our waste reduction further than our even more because employees take their income production processes, keeping 55 percent of with them and spend it where they live. The farther our own waste out of the waste stream by reusing away people live from work, the greater their or recycling. commute times, adding to already burdensome traffic congestion in the Seattle area. Award-winning recyclers Environmental commitment Even though we house the manufacturing portion of our business on the property we own adjacent to the Ardagh and our neighbor Strategic Materials Inc. leased land, we recognize the overall environmental (SMI) are proud to be leaders in glass recycling in impact of our operation must be considered, just as Seattle and King County. Our combined operations we are asking you to consider our overall value. are the receiving point for 100 percent of Seattle and King County’s curbside glass recycling programs. Ardagh is grateful to be part of the Seattle plant’s This relationship keeps 465 tons of glass out of long history, and since taking ownership in 2014, landfills every day, and 170,000 tons of glass out of we have prioritized making process and business landfills each year. improvements for the benefit of the environment and our budget. Our operation is regulated by a variety Ardagh Group’s Seattle facility was named the of laws and permits, and our livelihoods depend 2017 Washington State Recycler of the Year by the on working in partnership with the regulators who Harbor Bond Portfolio - Round 2 offer 5 administer the laws, rules and regulations that The Puget Sound Clean Air Agency, with authority govern our work. While our relationships with delegated to them by the U.S. Environmental regulators are not always easy, and we do not Protection Agency, holds us to these requirements. always agree, we have a shared interest in a clean When we have issues, we work together to get back and efficient operation. into compliance quickly. Manufacturing bottles is an energy-intensive process In the interest of protecting stormwater runoff that releases significant quantities of nitrogen oxides from our site and complying with the stormwater (NOx), sulfur dioxide (SO2) and particulate matter permit we have with the Washington Department of (PM2.5). These emissions trigger coverage of our Ecology, we run a full-time sweeper onsite. facility under Title V of the U.S. Clean Air Act. We see the requirements of our Title V permit as Recognizing that environmental protection at a essential to protecting the health of our employees manufacturing facility requires time and expertise, and the surrounding communities. we created a full-time environmental engineer position to coordinate, implement and monitor plant environmental processes and activities to ensure regulatory compliance and conformance to company environmental policies and procedures. We and our subtenants are adjacent to the Duwamish Waterway, a Superfund site. As an industry with a long history next to this site, we appreciate our shared responsibility with other Duwamish neighbors, including King County, to ensure a clean waterway. Our environmental efforts are paying off. The plant first achieved the highly regarded ISO 14001 certification in 2013 and has maintained its status in good standing, renewing the certification Harbor Bond Portfolio - Round 2 offer 6 according to updated standards in 2019. ISO, or the do not want this to happen again, and maintaining International Organization for Standardization, is competitive operating costs is critical for us to an independent, non-governmental international succeed. We are committed to creating quality glass organization of industry experts. The 14001 products by skilled workers right here at home. certification demonstrates we have met specific requirements for our environmental management system that we can use to enhance our environmental performance.4 Decreased transportation emissions Much of the leased land is occupied by our two main Looking to the future, Ardagh’s plans include suppliers: SMI provides recycled glass and J.A. Jack significant investment in the site and in our business & Sons provides limestone, both of which are critical operations. We believe these investments will enable to the production of glass containers. us to sustain jobs and improve the environment. We house 85 percent of our onsite storage on the If our plant was forced to close, our glass bottle leased property, and we purchase the majority of our customers would likely turn to imports from China packaging from WestRock, which is also located on a and other countries that do not impose such neighboring lot. protective requirements on their manufacturing plants, allowing more pollutants and greenhouse This proximity to our suppliers means we produce gases to affect the local and global environment. very few transportation emissions to bring in supplies Plus, there would be significant emissions from the to the plant. It also means we can control our import ships transporting the bottles to the United States. costs. Without the benefits of onsite storage and close-in supply, our costs would skyrocket and could Our business is already under enormous pressure be more than the Seattle plant could bear. from growing Chinese glass container imports. These pressures required us to curtail one of our If a warehouse or distribution center were to replace four furnaces in Seattle earlier this year that resulted our leased land, the number of trucks entering in the elimination of approximately 50 jobs. We and leaving the property would grow dramatically, ISO 14001:2015 Environmental management systems -- Requirements with guidance for use. (n.d.). Retrieved from International Organization for Standardization: https://www.iso.org/standard/60857.html 4 Harbor Bond Portfolio - Round 2 offer 7 adding significantly to traffic congestion and Also, Ardagh uses Ohio Avenue South to load and transportation emissions while the nearby Port of ship its products. If our Seattle plant were able Seattle is investing heavily in reducing emissions to survive losing our lease, we estimate our truck from trucks and ships at its facilities. Port efforts traffic on Ohio would double because of our need to include allowing cruise ships to plug into electricity begin bringing in supplies by truck. This increase in at the dock and offering cash incentives for truckers truck traffic could present a conflict that would be to trade in old vehicles for trucks with newer, cleaner- problematic for another business. burning engines. 5 Trucks trying to access the leased land to get to a Site well-suited to our operation warehouse and distribution center would have to enter and exit from East Marginal Way South (which is also Highway 99) – an already congested street The leased property is situated between the during peak commute hours. Left turns to enter or Duwamish to the west and Ardagh to the east. exit the site would be extremely challenging and Narrow Ohio Avenue South runs between the leased frustrating for other drivers. land and the land we own. We and our subtenants have purposely kept our use Our location on the Duwamish is ideally suited for of the leased site relatively light – literally – locating our supplier, J.A. Jack, which receives its limestone heavy buildings and equipment elsewhere. The site shipments via barge. On the other hand, warehouse is layered with fill material that is subject to frequent and distribution centers receive and ship their and ongoing settling. We regularly maintain the site products via trucks. These operations do not require by leveling the surface as necessary and adding water access, and, in fact, being located along a supports to our structures. A heavy distribution waterway would be limiting in terms of access for center may not be well-suited to these conditions. truck-dependent warehouses and distribution centers. 5 Bernton, H. (2018, March 22). Air is getting cleaner around Puget Sound ports even as greenhouse-gases emissions remain about the same. The Seattle Times. Retrieved from https://www.seattletimes.com/seattle-news/ air-pollution-from-puget-sound-ports-is-declining-survey-finds/` Harbor Bond Portfolio - Round 2 offer 8 Into the future This plant has been in operation for nearly a century, making quality glass containers that contribute to the economy and that our employees are proud to produce. We hope that you will consider the array of benefits of having a long-term partner on the leased property. We are committed to actively investing in this site, the environment, our employees and the community for the century to come. Sincerely, Bertrand Paulet Ben Michaelson President and CEO, Ardagh Glass Inc. Plant Manager Seattle, Ardagh Glass Inc. Cc: Joshua Markus, General Counsel North America, Ardagh Group Stephen Cugier, Real Property Agent, King County Real Estate Services Anthony Wright, Director, King County Facilities Management Division Harbor Bond Portfolio - Round 2 offer 9 . STRATEGIC MATERIALS STRATEGICMATERIALSLOM June 3, 2019 King County Council 516 Third Avenue Seattle, WA 98104 Dear County Council, We are writing to formally support Ardagh?s glass recycling facility in the bid to renew their lease with King County. We partner with Ardagh and directly operate on this property and have done so for more than 10 years, bene?tting the local economy and environment. Without the land from the County, our costs would increase signi?cantly and negatively impact our competitiveness in the region or possibly, the ability to operate in the region. Some key facts about our operation, which is directly tied to and critical to Ardagh?s operations on the property are as follows: We are the largest glass recycler in North America, with nearly 50 locations. We have operated in Seattle for more than 10 years Over 30 people are employed at this operation Nearly 200K tons of glass are processed at our facility; We receive and send 30-50 trucks of glass per day 1- 100% of the glass collected curbside in King County and surrounding areas is accepted and recycled by us today We pay over in taxes annually to the County The use of recycled glass, also known as cullet, in manufacturing new container glass results in energy savings and CO2 emission reductions, since recycled glass melts at a lower temperature If Ardagh would not be allowed to remain on the property, we would likely ?nd it dif?cult to continue operations in the state of Washington, and therefore glass recycling in the state would suffer. We strongly encourage you to consider Ardagh in the bid process. Regards, Joe LaPierre Strategic Materials Vice President- Container Harbor Bond Portfolio - Round 2 offer 10 67. 24. [ac? 5? 50nd, .7516. BUILDING SOCIETY WHILE BENEFITING THE ENVIRONMENT INDUSTRIAL 8: AGRICULTURAL LIMESTONE PRODUCTS June 3rd, 2019 5427 Ohio Avenue South Seattle, WA 98134 To Whom it May Concern: As representatives of Jacks 8: Sons, we kindly request that the leadership of King County reassess the open bidding process on the property currently leased by the Ardagh Group. We request that King County enter good faith negotiations with the Ardagh Group to ensure the longevity of their business and the benefit it provides to the economy and citizens of King County and the City of Seattle. Our company, lack Sons, operates a limestone processing facility on a portion of the property leased to the Ardagh Group. For approximately 50 years, Iack Sons has been a good tenant of this property and has provided significant benefit to the surrounding area of King County. The business relationship with the Ardagh Group has been one of great value through the years. Ardagh is a critical customer to lack Sons and without their support and demand for our product, the Jack 8; Sons operation would be significantly compromised, negatively impacting our own long-term vitality. The Jacks Sons business employees 28 people at the Seattle operation and is supported by another 13 people at the limestone mining operation. Without the Ardagh Group?s lease extension, lack Sons would be forced to eliminate many of these positions, negatively impacting King County?s business growth and tax base. In consideration ofour own long-term position on the leased property, we support King County?s renewal of the Ardagh Group?s lease. Our own interests are contingent on an extension of this lease. lack Sons has no interest in shuttering our business doors, eliminating our strongly committed employee base, and ending the legacy of the business. In addition to supplying the Ardagh Group with a critically important raw material, lack Sons is also a vital supplier to several other large local manufacturers and businesses of King County; including, US Gypsum, CertainTeed, and many other businesses in the surrounding area. Any disruption to the production at lack 8L Sons would have a severe impact on the operation of these businesses. Harbor Bond Portfolio - Round 2 offer 11 I. 1} ?ue. a. BUILDING SOCIETY WHILE BENEFITING THE ENVIRONMENT INDUSTRIAL 8: AGRICULTURAL LIMESTONE PRODUCTS We are confident that a suitable lease can be achieved with the Ardagh Group if King County is willing to negotiate the terms of an extended agreement. We appreciate your willingness to evaluate our request and the continuation of the relationship that exists between our businesses and King County. Sincerely, eneral Manager lack Sons Harbor Bond Portfolio - Round 2 offer 12 A: WestRock V, Seattle, WA 98134-2414 June 2019 To Whom It May Concern: This letter is in support of renewing the Ardagh Group?s lease with King County. The renewal of the Ardagh lease is not only critical to their operation but to operation of the WestRock Seattle manufacturing facility. We feel very strongly that renewing their lease is an urgent matter and that a failure to renew the lease will have a tremendous negative impact on our business. The WestRock Seattle facility is a union facility and currently employs 102 people, both salaried and hourly. Our history and roots run deep with Ardagh; Ardagh is both our oldest and closest business partner. Our partnership with Ardagh is unique: in fact, our facility was built in 1953 speci?cally to partner them. For over 65 yea rs we have partnered with Ardagh in the business community, providing well-paying union jobs to hundreds of families over the past 6 decades. That continues to this day. However, failing to renew their lease would impact our facility in a terrible fashion, likely resulting in the loss of twenty ?ve percent of our union work force, along with a similar number of salaried jobs. But the effect would ripple deeply through our entire organization. The effect at Ardagh, and their work force, would be significantly higher if the lease was not renewed. The effect would not just be on the businesses involved but on the lives, and livelihoods, of hundreds families with good paying jobs who would lose their incomes. Again, we at WestRock Seattle are in complete support of the renewal of Ardagh?s lease with King County. Please feel free to contact me with any questions. Sincerely, Richard Morgan General Manager WestRock Seattle Richa rd.l.morgan@westrock.com Harbor Bond Portfolio - Round 2 offer These unions represent more than 300 of Ardagh Group?s approximately 340 Seattle plant employees. Both represented and non- represented employees have signed this letter in support of preserving manufacturing jobs in Seattle. UNITED STEELWORKERS IMC UNITED STEELWORKERS $92333UNITY AND STRENGTH FOR WORKERS El?) cuss. mowers, POTTERY, ?1?5 UNITY AND STRENGTH arm: WORKERS mugs 3, ?Min WORKERS 1?49. a 1. June 18, 2019 Dear Executive Constantine, Honorable Members of the King County Council, and Kidder Mathews: We, the employees of Ardagh Groups?s Seattle manufacturing plant, urge you to renew our lease for the long term to retain manufacturing in the city, support hundreds of family-wage jobs, and preserve the glassmaking legacy on our South Seattle site that we have occupied for nearly a century. Ardagh is participating in King County?s competitive bid process for the property, which the county calls the Harbor Bond Portfolio. Without the leased property our entire manufacturing operation and our approximately 340 family-wage jobs are at risk. The four unions that represent more than 300 of ourjobs are united in support of a lease renewal. The consequences of failing to secure a renewed lease extend beyond the borders of Ardagh. The jobs of hundreds of people who work for our vendors and neighboring businesses are also on the line. King County?s marketing materials are focused on attracting more warehouse and distribution centers to the area. But they fail to mention our manufacturing operation?s critical dependence on the property. If our plant is forced to shut down by an incoming warehouse, our jobs would be replaced by low?wage jobs with high turnover rates. Our skilled workers have been making quality glass containers, such as wine bottles and juice bottles, at the East Marginal Way South plant we have owned since the 19305. We have been King County?s tenants at the adjacent waterfront property since the 19605. Multiple generations of families have spent their careers at this plant. Seventy-two percent of us (R in King Cu unty and or money right back into the local ?lit?.5 ?lcase, 3"?th 0.3! MEDHRB NEED MW) \Bobo) A Harbor Bond Portfolio - Round 2 offer 14 Manufacturingjobs are in short supply in this region. Without this plant, we are deeply concerned for our future employment options and the local legacy of manufacturing in general. Our plant plays a key role in sustainability. We manufacture a high?quality, loo-percent recyclable product every single day. In fact, we produce more than 1 million wine bottles daily, serving as a main supplier of wine bottles for the Pacific Northwest wine industry. We also receive a_H of Seattle and King County?s curbside glass recycling, which keeps 465 tons of glass from being dumped into landfills every day. We, the undersigned Ardagh Seattle employees, strongly urge you, our elected representatives to stand with our 340 family?wage jobs and support what is left of our region's manufacturing legacy. Thank you. - 15%. ,1 @W?d (W Harb ond Portfolio - Round 2 offer 15 ., ll a f2 g% 2/ Harbor Bond Portfol 3555?}, Mam NW ?q?me? Jw 155m EM <29? m, 58%? claw 1 Harbor Bond Portfol ?1 Tv?? ?f?uw thewgw EV \Jm/(s MAMQM Raise? Wm?) V) Pam; mg my mam q; CMEZJQW ?Omne/ 5mm mom 5% Harbor Bond Portfol MANN wart/N 31' MR ?kwm Ohm ?aner 1/ Harbor Bond Portfol NN are 6:30?. - ccom .30.ng Ev $33 hm?N\V\ g? umeiiRF?X Harbor Bond Portfolio - Round 2 offer 23 Warn 937 g, Harbor Bond Portfol