Thumbnail photo by Gavin Van Alstine Crescent City Harbor commissioners took Sandy Moreno’s advice and decided not to renew property insurance that covers damage to the docks in the marina from fire and collision. Moreno, who became the Harbor District’s financial advisor in April, urged commissioners to hold off on renewing the Commercial Property — Inner Boat Basin Docks portion of their coverage with Redwood Leavitt Insurance Agency. She proposed taking the $181,500 premium it would have cost, putting $50,000 of it toward maintenance and using the remainder to keep the Harbor District solvent through the fiscal year. “I’m giving you guys a year to get your shit together and if we do this one thing it does that,” she said Wednesday. “We will get through a year and if revenue generation and our cost savings and all the things we’re looking at doing — you will be in a really good place come July 1 of next year.” The Board voted to renew their overall insurance policy with Redwood Leavitt Insurance. This means the Harbor District as a whole has general liability protection, which includes being covered for fire damage and “slip and falls.” The Harbor District’s trailer and pickup trucks as well as its equipment, including a backhoe, two forklifts and three vessels, are insured as are its commercial buildings and Citizens Dock. The total renewal cost minus the Commercial Property — Inner Boat Basin Docks policy is $133,074.76, according to the renewal proposal Redwood Leavitt presented to the Board. According to Moreno, the Harbor District would have had a $250,000 deductible if it had renewed its Commercial Property — Inner Boat Basin Docks policy. That coverage does not include protection from tsunami, wave or wind damage, she said. The last time damage to the inner boat basin docks exceeded $250,000 was as a result of the tsunami spawned by the Great East Japan Earthquake in 2011, Harbormaster Mike Rademaker said. He also recommended looking into a self-insurance option, potentially through a Local Agency Investment Fund, or LAIF, and said their agent, Chris Dufour, would be able to help with that. “We’re trying to find money wherever we can and this is a huge pot of money with a relative risk-to-reward ratio,” Rademaker told commissioners. “You need that cash flow and it’s a pretty small risk in the grand scheme of things. And we do have other options if there was a natural disaster.” Four harbor commissioners approved a motion from Commissioner Annie Nehmer who proposed to put the entire $181,500 into a LAIF account for 90 days. Board President Gerhard Weber dissented after raising concerns about the $50,000 that Moreno had suggested setting aside for maintenance as well as the $130,000 that she had wanted to use to keep the Harbor District operational through the next fiscal year. Moreno had supported the proposal to place $130,000 into a LAIF account for 90 days and allocate $50,000 toward maintenance. “If we do our normal October meeting, we can look at where we’re at and by then we’ll still have $130,000 in our LAIF,” she said. Before the Harbor Board made their decision concerning the district’s insurance coverage, Moreno gave a presentation on the 2025-26 fiscal year budget. Saying the Harbor District currently has $368,439 in the bank, Moreno projected a net decrease of $340,839. She said the Harbor District would have an ending fund balance of $25,000 “if we meet our budget.” Moreno said she reduced the projected revenue the Harbor District is expected to receive during the next fiscal year by about $120,000. This includes decreasing the projected poundage fees the district collects from seafood coming across the docks from $100,000 to $75,000. The one area that stayed status quo in terms of generating revenue for the Harbor District, however, is the marina, Moreno said. “The marina is where we make money,” she said. “They’re the people who bring that money in so the $234,000 stayed the same.” As for expenses, Moreno said she was concerned about the cost of electricity, noting that the harbor was paying $20,000 in electricity costs at its two RV parks. She said she wanted to do an electricity audit, looking at the the port’s meters, to “figure out what’s going on with electricity.” The Crescent City Harbor District is also continuing to pay off the USDA loan that helped pay to rebuild the marina following the 2011 tsunami as well as the settlement payment to Fashion Blacksmith. According to Moreno, the payment to Fashion Blacksmith for the 2025-26 fiscal year is projected to be $380,000 not including interest. According to Moreno, if the Harbor District decided to renew its Commercial Property — Inner Boat Basin Docks insurance, that $181,000 cost would put the district at a negative $40,000 by the end of the fiscal year. “That’s putting no money aside for capital improvements, emergency reserves or asset purchases,” she said. “You [are] $28,000 positive if we don’t pay $181,000.” Moreno said her budget didn’t account for about $240,000 in grant dollars the Harbor District could realize nor the potential $50,000 to $100,000 in savings due to maintenance supervisor Rich Salvaressa retiring. Though they were amenable to going without fire and collision coverage for the inner boat basin docks — particularly since coverage wouldn’t kick in unless damages exceeded $250,000 — the Board’s conversation turned to whether or not liability insurance should be required for people who want to moor their vessels at the dock. According to Nehmer, 13 vessels that moor at the harbor do not have liability insurance. Their owners pay an extra fee to the Harbor District, but they still have no insurance. Rademaker said the extra fee was meant to be an inducement for boat owners to get liability insurance. Commissioners should consider whether or not the Harbor District should turn those uninsured boats away. Nehmer said she was also concerned about whether a lack of maintenance on the Harbor District’s electrical infrastructure on the docks is considered a liability. She said she would be willing to start an insurance pool instead of doing without fire and collision coverage for the marina. “Two-hundred and fifty-thousand dollars might sound like a bit deductible, but it might be a drop in the budget,” Nehmer said, adding that some of the electricity pedestals in the marina shake . “Boats catch fire, and if one catches fire and it’s because [of] our electrical, the problem is on us.” Later on in the discussion, when commissioners made the decision to forego spending $181,000 on fire and collision coverage for the marina docks, Nehmer proposed restricting that savings. “If [we] leave it all in the general fund it’s way more likely to get spent,” she said. The reaction from the public on the harbor foregoing property insurance on its inner boat basin docks was mixed. Some like former Del Norte County supervisor Gerry Hemmingsen, who owns a boat at the marina, said he understood that having to pay a $180,000 annual premium and a $250,000 deductible if the insurance is needed could make things worse financially for the harbor. Hemmingsen also urged commissioners to make liability insurance a requirement for people who moor their vessels at the harbor rather than paying a $184 fee that goes into the general fund. “That’s a mistake. You need to change that,” he said. “If they don’t have to have insurance, maybe I’ll get rid of mine and just pay $184 a month.” Others like Del Norte County Unified School District trustee Michael Greer said not having insurance is a gamble. He said the school district is experiencing similar financial constraints that the harbor is and is having to make cuts. “Over my dead body if I make a cut on insurance,” he said. Henry Geiger, exalted ruler of the Crescent City Elks Lodge who spearheaded a partnership with the Harbor District to manage its two RV parks, called not having insurance a gamble and brought up Murphy’s Law. Geiger also challenged a statement made by Rademaker and Commissioner John Evans, who said that the risk of fire damage to the docks was minimal because they’re made out of concrete. “Concrete doesn’t burn but we have issues with concrete cracking,” he said. “We don’t know what the future holds, but I do know Murphy’s Law is alive and well because every time I try to think of something Murphy always jumps up and bites me in the butt. I think you should purchase that insurance.”