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Tuesday, February 27, 1990 - Page updated at 12:00 AM

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Settling Down On The Land -- Who Are The Winners As Tribe, Port Of Tacoma Draw New Boundaries?

TACOMA - Will the historic $162 million land-claims settlement to the Puyallup Indian Tribe make huge winners of the Port of Tacoma, the surrounding region and the Puyallups themselves?

The jury is still out.

The settlement, the second-largest to a Native American tribe in U.S. history, will compensate the 1,500-member tribe for claims to hundreds of acres of land around the port, including the former bed of the Puyallup River. The agreement will go into effect sometime in the next few weeks, its negotiators said.

Port of Tacoma commissioners say they expect the agreement to spur meteoric growth, principally on 600 acres on the Blair Waterway that the settlement will open for marine terminal development. Those acres are underused because the 35-year-old Blair Bridge is too narrow to accommodate today's large cargo ships.

Port economists project that the settlement-related growth will infuse the Pierce County economy with more than 6,500 permanent jobs over the next 10 years, and could increase by 50 percent the units of container-cargo the port handles in that time.

For its part, the tribe will receive cash, social and employment programs and 900 acres of land, including 129 acres on the Blair, most of which is designated as a foreign-trade zone. Depending on how the land is developed, it could spur even more growth for the port.

``We already own the land, so our costs are low. We've got the intermodal yards. And now we're going to get rid of this bottleneck,'' said Tacoma Port Commission President Patrick O'Malley. ``For marine terminals, it's like rocket science.''

But the equation still contains a lot of unknown quantities. They include:

-- The dynamics of future cooperation and competition between Tacoma and Seattle.

A 1985 Washington Public Ports Association (WPPA) study has made both ports confident that demand for container terminals in Puget Sound will fill both new facilities in Tacoma and the Port of Seattle's proposed 150 acres of new container space.

But if the WPPA estimates - which are being updated this year - are too high, the two ports may find themselves at odds over who should build when, said Mark Reis, the Port of Seattle's director of marine policy.

The two ports recently agreed to share information on new development projects. But they have yet to decide just how the information should be used, Reis said.

``What we do with that information is going to be the true test of cooperation,'' he said.

That cooperation has been a bit shaky. Port of Seattle Executive Director Zeger van Asch van Wijck recently charged that Tacoma staff members, by visiting several of Seattle's major shipping clients overseas, have been trying to steal his customers.

One of those carriers was China Ocean Shipping Co., which might be interested in moving to Tacoma if the Puyallups strike a proposed deal to build a garment-manufacturing business using imported Chinese textiles, O'Malley said. But O'Malley and other Tacoma port staff say the visits were just courtesy calls.

-- The Blair Bridge itself.

The settlement includes about $41 million to either replace the bridge or tear it down and build an expressway around it. Tacoma port commissioners favor eliminating the bridge to maximize development, but city officials have said they will wait for the outcome of an environmental impact statement due next month. Port commissioners may face strong opposition from residents of northeastern Tacoma and Federal Way, who would have to take a more circuitous route to downtown Tacoma without the bridge.

-- What the Puyallups choose to do.

With all the options for the use of their land, the Puyallups could turn into port collaborators or tough competitors in the container game, O'Malley said.

Tribal leaders have created an independent economic development board to choose enterprises for settlement lands. Three of the seven board members are tribal members; the rest are non-Indians chosen for their business acumen.

Arthur Riedel, chief executive officer of the Portland-based marine technology corporation Riedel International, and Mark Copeland, an Anchorage attorney who has represented some of the corporations set up to manage the $962.5 million settlement to 70,000 Alaska natives in 1971, have already been selected as non-Indian board members, as have local executives from Weyerhaeuser Co. and Frank Russell Co.

Despite their independence, board members will bear the pressure of more than market forces in making their choices. Tribal leaders, for example, want to provide immediate jobs for an impoverished constituency. Container terminals in and of themselves have not been big money-makers for ports - and their highly mechanized operation and high fixed costs won't immediately yield many jobs.

And because the settlement money and land wipes out the last of the tribe's land claims, it can't be invested lightly: The lower the risk, the better.

``This is the settlement of their rights we're talking about,'' Copeland said. ``We have to be more conservative than a regular corporation.''

-- The value of the tribe's land after environmental cleanup.

The tribe's Blair property is sandwiched between - and contaminated by - two of the worst polluters on the Tideflats: Reichhold Chemical Inc. and the Pennwalt Corp. The Port of Tacoma has promised that the Blair and Hylebos waterway lands to the tribe will be cleaned up in a maximum of five years.

The port and the tribe have been haggling recently over cleanup procedure, however. The tribe is worried that the placement of wells for long-term cleanup will restrict their access to much of the waterfront property, said Dennis Gibb, the tribe's former head of economic development.

And the land may be more contaminated than originally suspected. Recent reports filed with the U.S. Environmental Protection Agency show that traces of dioxin, which causes cancer in laboratory animals, and other chemicals have seeped from the Reichhold property onto the soon-to-be tribal land.

Port consultants are still running tests to determine the extent of contamination.

------------------------------------------------------------------------

LAND CHANGES HANDS

The Puyallup Inidans had ownership claims against the following lands:

A. Initial surveyed treaty reserve, 1855 ;

B. Intended treaty reserve, 1854 ;

C. Puyallup Indian Reservation established 1873 ;

D. Lands that were part of the Puyallup River bed at the time

of the Reservation survey of 1873 ;

E. Additional tidelands established by executive order in 1873

;

F. Tidelands reserves established by executive order in 1857 ;

Puyallup lands after the 1988 settlement ;

These Tacoma and Fife properties will be transferred to the Puyallup Indians in the settlement along with cash, social and employment programs.

Copyright (c) 1990 Seattle Times Company, All Rights Reserved.

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