Instead of hiring a consultant to determine if the community would support a tax measure to keep the Crescent City Harbor afloat, commissioners elected to wait on the outcome a new citizens initiative spearheaded in part by the Del Norte Fisherman’s Marketing Association.
The Save the Harbor 2018 citizens initiative seeks to increase the transient occupancy tax visitors to motels and hotels in the county pay from 8 percent to 10 percent, harbor Commissioner Brian Stone said Tuesday. The initiative also seeks to place a 2 percent transient occupancy tax on recreational vehicles renting space at parks in the county.
Money generated by these taxes would be used to help the harbor pay down a $5.3 million U.S. Department of Agriculture loan obtained to rebuild the marina following the 2006 and 2011 tsunamis, Stone said. If successful, the citizens initiative would only increase TOT taxes in the county and would have no impact on visitor taxes within the city, he said.
“The calculations are some place between $240,000 up to $275,000 per year, which would cover, basically, our USDA loan,” Stone told his colleagues on the harbor board. “There is no sunset on that; it would go on ad infinitum.”
Stone and the other harbor commissioners have been discussing ways to increase revenue to pay down the port’s $5.3 million debt since early last year. According to Stone, the harbor is running a $500,000 deficit and with only $1.8 million in reserves could be out of cash in about two to three years.
If the port were forced to shut down, Stone estimated that about 563 individuals would lose jobs associated with the commercial and recreational fishing fleets, while 804 jobs would be lost as a result of the restaurants, Fashion Blacksmith and other businesses at the harbor closing. Stone also estimated a further 50 to 150 jobs could be lost as a result of a “ripple effect” the harbor’s closure would have on hotels near the port.
Until recently, harbor commissioners had discussed placing either a sales tax initiative or a property tax assessment on the November 2018 ballot. But they had yet to decide which tax to pursue and what that initiative would look like.
Rick Shepherd and George Bradshaw, of the Del Norte Fisherman’s Marketing Association, introduced the Save the Harbor 2018 citizens initiative, the idea of increasing the county’s TOT tax from 8 to 10 percent and placing a 2 percent TOT tax on RV slips in the county to the Board of Supervisors on Jan. 23.
Shepherd and Bradshaw as well as Del Norte County Unified School District trustee Don McArthur and Del Norte County Library District director John Roberts sponsor Save the Harbor 2018.
McArthur said he and Roberts had been talking about ways to keep the harbor solvent for months but didn’t organize the Save the Harbor 2018 campaign until after they met with Shepherd and Bradshaw about two weeks ago.
Shepherd and Bradshaw informed the Del Norte County Board of Supervisors of their decision to put forward a citizens initiative to increase the TOT tax in the county.
After discussing the alternatives, McArthur said the co-sponsors of the initiative felt a TOT tax could raise the money the harbor needs to pay off its debt while having the least impact on Del Norte County residents. McArthur also noted many visitors to Del Norte often explore the harbor during their stay.
For a citizens initiative to be ready for the November general election, representatives of Save the Harbor 2018 must collect 704 signatures countywide and bring it to supervisors, which will then place it on the ballot, said County Clerk-Recorder Alissia Northrup. She said the campaign must complete the signature-gathering process and obtain approval from supervisors by June 28.
“They’re at the beginning of the process,” Northrup said. “We’ve submitted their declaration to our county counsel. They have 15 days to come up with a title and a summary and then they give it back to me.”
While exploring whether a citizens initiative to increase the TOT tax by 2 percent in the county would be successful, McArthur said he and the other sponsors of Save the Harbor 2018 conducted a small survey of local voters. Representatives of the campaign obtained about 3,000 emails from the County Clerk-Recorder’s office, McArthur said, however half of them were bad.
According to Stone, who obtained the results of Save the Harbor 2018’s survey, the campaign received about 56 responses to their questionnaire.
The survey asked the following eight questions:
Did you know that the Crescent City Harbor was destroyed by the tsunamis of 2006 and 2011?
Did you know that the harbor suffered $54 million in damage?
Did you know that the harbor district borrowed $5.5 million from the federal government to rebuild the Crescent City Harbor?
Before receiving this email, did you know that the harbor district was in financial trouble?
Before receiving this email, did you know that over 850 jobs could be lost in Del Norte County if the harbor closes in the future?
Would you be willing to support the harbor and protect 850 jobs in our community?
Would you support an increase in visitors hotel/motel tax by 2 percent to help fund the harbor to protect over 850 jobs in our community?
And, finally, would you support an overnight visitors tax on recreational vehicles to help fund the harbor and protect 850 jobs in our community?
At the harbor district meeting, Stone said more people answered no than yes on questions two through six. However most of those surveyed knew the harbor had taken significant damage in both tsunamis and most supported increasing the TOT for hotels and motels in the county as well as establishing a new TOT tax on RVs in the county, Stone said.
“There’s a bias built into it,” Stone said of the Save the Harbor 2018’s survey. “But at the same time it does give us information we dearly needed and I think it’s helpful to us.”
Stone’s colleague, Commissioner Wes White said he obtained the results of a second survey that was privately funded and conducted by a professional firm. This firm polled about 100 people, White said. It informed them that the port only has enough funds to operate for three years after which it may be “forced to, very operative word, close,” White said, and asked if they would support additional taxes to keep the harbor open and functional.
“Sixty-three point one percent said yes,” White told his colleagues. “So if we require a 2/3rds vote, we have some work to do according to this pollster.”
White said the pollster’s suggestion was the harbor spend no money and “get people to go on Facebook” to promote any potential tax initiative it supports. He noted that as a governing body, the harbor commission cannot support the citizens initiative.
However, White refused to disclose the identity of the firm that orchestrated the poll or provide a copy of the survey to the Triplicate when asked.
“This is private (what) I gave to each of you is private,” White told his colleagues on the harbor district board.
“It’s not public information,” White told the Triplicate following the Harbor District meeting. “It’s not public information it’s private...”
Though the Save the Harbor 2018 citizens initiative will help the port pay down its debt if successful, the port must still find a way to pay for much-needed repairs to a crumbling sea wall, Citizens Dock and Whaler Island Groin.
In November, Stone estimated the harbor needs to make about $15 million in repairs, which include upgrading aging roads, dilapidated buildings and the water-sewer systems.
On Wednesday, Stone told the Triplicate the harbor commission is still exploring ways to come up with the money to make those repairs.
Having between $240,000 and $275,000 from a TOT increase to make its loan payments will extend the life of the harbor and allow it to free up its other revenue, Stone said. The port currently makes about $60,000-75,000 a year in profit from the new Redwood Harbor Village RV park and expects to save on its energy costs due to a new solar power installation. The harbor also plans to take over Bayside RV Park when its lease expires, Stone said, and develop the area near Anchor Way and Starfish Way for tourists.
“This will take a period of about four years to do, the problem we’ve got is how do we keep the harbor open at least four years to make this happen,” Stone said. “We have to make something happen so we’re not taking the $260,000 payment directly away from operating funds to pay that loan.”
For more information about Save The Harbor 2018, email firstname.lastname@example.org .
Reach Jessica Cejnar at email@example.com .