While the economic health of other Puget Sound counties deteriorated and the state slipped into a recession last winter, Kitsap County remained strong, according to state Department of Revenue statistics released last week.

“Other Puget Sound counties, such as King County, boomed bigger over the last decade, and now they are busting bigger,” said County Commissioner Chris Endresen. “Kitsap County is steadier in terms of employment and income.”

Retail trade in Kitsap jumped by 9.6 percent during the last quarter (September through December) of 2001 over the same time period the year before. Similarly, overall taxable retail sales in Kitsap increased by 5.5 percent in the last quarter of 2001 — also over the same time period the previous year.

State officials define all taxable sales to include construction, contracting, manufacturing, transportation, communications, utilities, wholesale, real estate and insurance.

Retail trade, on the other hand, better represents consumer purchases and includes building materials, hardware, general merchandise, food, auto dealers, apparel, furnishings, eating and drinking places and retail stores.

Although the numbers look good on the surface, county officials are still cautious because sales tax revenues generated over the last six months – including the first quarter of 2002 and the last quarter of 2001 – are only coming in at predicted levels.

Plus, state backfill funding for the county won’t come through as planned this year and the aftershocks of Initiative 747, which caps property tax increases by no more than 1 percent, have yet to be felt in the coming budget years.

Kevin Dwyer, executive director of the Bainbridge Island Chamber of Commerce, said the outlook here seems favorable.

“I will say that the island economy, while not vibrant, is steadily improving,” Dwyer said. “With the exception of some significant offices spaces abandoned by the Bainbridge HPC, there are few, if any, retail spaces available on the island.”

Positive signs

There are number of positive signs that suggest the island’s economy is in a definite “recovery mode,” Dwyer said.

He cited the opening of the Winslow Paint Co. on Hildebrand and Casa Rojas, a Mexican restaurant at the Pavilion, as reflecting “the confidence those business owners have in the buying power of Bainbridge consumers.”

Also, there are more than a half-dozen multi-use office, retail and condominium and industrial/warehouse projects in the planning pipeline, he noted.

The largest is Harbor Square at Winslow Way and Ferncliff, with others including the “Re-Doogal’s” project, the Seaboard Building, the Meridian on Bainbridge Island project, the Rosebud Building on the north end of Madrona Way, Lynwood Commons and Mills Hardwood Flooring’s new industrial building on Sportsman Club Road. Another 7.5 acres on Sportsman Club is set aside for a potential business park or industrial use.

“I think the increase in Kitsap was largely driven by car sales and the attractive interest rates offered last winter,” Endresen said. “There were people who were probably waiting to buy a car, but jumped in on the better deals.”

That theory, largely held by county officials, could make some sense, since retail sales in Bremerton jumped by almost 19 percent during that time and overall sales increased by more than 14 percent.

Most of the auto dealerships in Kitsap County are located in west Bremerton.

Bremerton saw the third-largest increase in sales among the 50 cities monitored by the state revenue department.

Overall sales in travel-dependent SeaTac during that time plummeted by 18 percent, and in retail sales by 8.8 percent. In King County, overall taxable sales dropped by 6.8 percent.

Sales in Tukwila, a city primarily supported by a strong retail core and regional shopping center, dropped by 18.3 percent.