Anatomy of a deal: How the Glacier agreement came to fruition

Last May, Amy Carey had a hunch. The time was ripe, she believed, to reach out to the company that owns the Glacier Northwest mine site on Maury Island and see if a purchase of the sweeping 250-acre property was a possibility.

It wouldn’t be the first time. Preserve Our Islands, the Vashon-Maury Island Land Trust and Cascade Land Conservancy (CLC) had attempted a round of negotiations that involved a visit to the nation’s capital with Glacier Northwest’s top executive in 2002. The effort fizzled when the nonprofit groups couldn’t come close to meeting Glacier’s price.

But Carey believed that the option of a sale had never gone away. And this time, she had a new idea: It was time to pull the corporate parent, Taiheiyo, a Tokyo-based multinational, into the picture, to take talks to the highest level possible.

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She called CLC’s Michelle Connor, the group’s senior vice president, shared her idea for a new strategy and asked if Connor’s organization would be willing to once again step in. “To her credit, she said, ‘OK, let’s go,’” recalled Carey, president of Preserve Our Islands.

Thus began a series of meetings — including several high-level negotiations — that would ultimately lead to what is now a pending sale of the property and, to some observers, nothing short of a miracle.

Should the $36 million sale go through — and both sides believe it will — the transaction will stand as the region’s biggest shoreline protection effort ever. It will also put to rest one of the region’s longest and most bitterly fought conservation battles, a dispute that has hung over the Island for years.

What prompted Carey to pick up the phone and call Connor that afternoon last May?

“I just sort of instinctively knew that it was the time,” Carey recalled during a wide-ranging interview with both her and Tom Dean, who heads the Vashon land trust.

Dean, a veteran of land transactions, compared Carey’s decision to try to jumpstart negotiations to what he and others in the land trust movement do every day.

“This is no different from trying to buy five acres from Joe down the road,” he said. “He tells you no. You call again six months later. He tells you no again and you call in another six months. Until eventually he says yes.”

“It’s hard to put a finger on what was different this time,” Carey added. “Except that when the time is right, the time is right.”

In many ways, however, the timing seemed far from propitious — and in fact it would still be months before talks got serious. In May 2009, when Carey convinced Connor to attempt to resume negotiations, everything was still going Glacier’s way. The company had secured its final permit from the U.S. Army Corps of Engineers and had begun building its controversial pier months before, pausing only because a so-called fish window that allows for in-water construction had closed.

POI was challenging Glacier’s Army Corps permit in federal court. But there was no reason to think success was imminent. POI had challenged many other state and county permits in several different venues — almost always striking out.

But Carey’s idea was compelling to Connor and others involved in the effort. So they quickly pulled together a meeting that included Carey and Dean, Connor and other CLC staff members and high-level people from King County — and mapped out a strategy.

CLC got members of the state’s congressional delegation to write letters to the CEO of Taiheiyo — a move that elevated the issue and caused the Japanese firm to take note. Gene Duvernoy, Cascade Land Conservancy’s executive director, was set to fly to Tokyo. The state, meanwhile, put its representative in Tokyo, a trade expert who works for the state’s Department of Commerce, Trade and Economic Development, on notice, asking that he be ready to facilitate a meeting.

Then, after weeks of back-and-forth discussions that were going nowhere, the negotiating team realized, as Duvernoy put it, “that we had to show them we had the oomph to get this done.” Thus began another watershed moment in the 13-year effort to secure the site — a yacht trip last August.

Duvernoy was able to secure a 65-foot yacht from a CLC supporter. More important, he and Connor were able to get some key players from the Glacier Northwest’s corporate parent — Allen Hamblen, the chief executive officer of CalPortland, and Shinji Matsui, president of Taiheiyo USA — to agree to take a cruise with them. As Connor put it, she knew they needed a face-to-face meeting, an opportunity to tell those at the highest reaches of the corporation the depth of the community’s desire to see the Maury site protected.

On a beautiful August day, Duvernoy and Connor set sail with the top executives — bringing a translator as well, since Matsui didn’t speak English — and made their way past the quiet, madrone-studded slopes of the Maury Island mine site. The team had a telephone on board and put Bill Ruckleshaus — the former head of the federal Environmental Protection Agency and a high-profile champion for Puget Sound’s protection — on a speaker, part of the team’s strategy to prove to Matsui that CLC had the backing to bring a deal of this size and complexity to fruition.

Even so, it didn’t begin terribly well. Before lunch, Duvernoy said, Matsui “spoke in a quiet tone and at great length” about why a sale wasn’t a good idea. “It was a very cogent presentation that made it sound like we were barking up the wrong tree,” he recalled.

But Connor and Duvernoy, veteran negotiators, stayed calm. They listened. They did not argue about the merits of their position. They then had lunch — a simple but artful spread of salmon and salad.

Duvernoy can’t say exactly what shifted. But after lunch, after both sides had carefully listened to each other and Duvernoy and Connor had made it clear that they were there to negotiate, not to debate, Matsui sounded a different note. He agreed to resume serious negotiations.

“It was a very serious commitment to what would be a very extensive negotiation,” Duvernoy said. Noting the beauty of the day, he added, “The weather gods were with us.”

In the weeks that followed, several other key events transpired that seemed to change the playing field, putting POI and its allies, for the first time in years, in a position of much greater strength. Of particular significance was POI’s victory in federal court just a week or two after the yacht trip: U.S. District Judge Ricardo Martinez wrote a hard-hitting opinion saying the Army Corps had failed to consider science when it issued its permit; the corporation, as a result, would have to go through the time-consuming process of a full-blown Environmental Impact Statement, securing yet another permit that would surely be appealed.

Another significant event took place two months later, when Dow Constantine, an outspoken critic of Glacier and a close ally of Sharon Nelson, POI’s founder, was elected King County Executive. Indeed, in the months that followed, Constantine played a hands-on role in the negotiations. He also appointed one of his top aides and a strong negotiator, Sung Yang, director of external affairs and government relations, to helm the county’s team in the talks.

But Ron Summers, senior vice president and general manager of the materials division for CalPortland, said all that really mattered to the company was whether a price could be reached that was acceptable. The Martinez ruling “was disappointing,” he said, but it simply signaled more steps in what had already been a very long process.

Indeed, some say the biggest issue that shaped the outcome of this long drama was one no individual could have predicted or influenced: the economy. When construction slows down, so does demand for the sand and gravel CalPortland sells. Asked if that had a bearing, Summers answered, “That probably had some impact on us. … Like anything, it’s all about timing, and the timing was right for a lot of reasons.”

Once it became clear that CalPortland and CLC were in serious negotiations, another big issue faced the team. They had to find the money to make it happen. When negotiations unraveled in 2002, they did so in part because the corporation had identified a sale price of around $60 million; Julie Burman, then the head of the Vashon land trust who went to the nation’s capital to try to find funds for a deal, was able to secure the promise of around $11 million — a far-cry from what the corporation thought was a reasonable offer.

Last winter, Sharon Nelson, a state representative who had just been elected to the state Senate, went to the Legislature determined to find the funds to bring the deal to fruition. Dean, Connor, Carey and others worked with her, using everything they knew about state and federal funding sources to see if they could find an untapped bucket.

It was Dean who had the idea to see if some of the Asarco settlement funds could be used to pay for the acquisition — a novel approach, since those dollars were meant for clean-up from Asarco’s historic, arsenic-laced plume that had cast a shadow over much of Maury Island. Dean argued that protecting the mine site and thereby saving its madrone forest was a kind of clean-up — since the forest acted “as a cap,” he said, keeping the tainted soil in place.

Connor agreed to explore the idea, arranging a meeting with state officials who were overseeing the settlement. They agreed that it made sense, and Nelson began the hard work of convincing her colleagues in the Legislature to go along with the deal.

Nelson’s success in securing state funds — $15 million all told — proved another critical juncture, one of the final pieces in the complex puzzle, Carey and Dean said. “Anyone negotiating a deal will tell you that you’ve got to have cash in hand to make it real, or you’re just playing with air,” Dean said. “Once Michelle (Connor) could come and say, we’ve got $15 down, … all of the sudden it became a real negotiation.”

To Dean, the fact that the Asarco settlement funds provided the seed money has a certain poetry to it. It was Nelson, in her early days as the head of POI, who pushed to have testing done at the Maury mine site — an effort on her part to give more substance to her argument that the site should not be mined. Her efforts had another outcome: Public officials began testing soils throughout the region, an exercise that established the extent of Asarco’s contamination and ultimately got Asarco to agree to a massive cleanup settlement.

“The Asarco settlement might not have even happened if it hadn’t been for Sharon,” Dean said.

Watch the press conference

Dow Constantine’s opening statement, filmed by Voice of Vashon, can be watched on YouTube. Or watch the entire news conference at VoV’s home page.