The Crescent City Harbor District approved an agreement with the county over use of Measure C revenue. Photo: Andrew Goff

The Crescent City Harbor District agreed to use revenue from a transient occupancy tax increase to pay a U.S. Department of Agriculture Loan first before focusing on the repairs of port facilities.

Commissioners on Tuesday unanimously approved a memorandum of understanding with Del Norte County outlines how dollars from the voter-approved TOT increase would be spent.

The MOU also grants the Board of Supervisors oversight over a facilities maintenance plan for the port. But, according to the agreement, the ability to make repairs to harbor facilities will come after the county auditor receives documentation showing that the USDA loan is paid off.

According to Harbor Commissioner Rick Shepherd, who helped spearhead the citizens initiative in 2018, approving the MOU was necessary to begin receiving that extra funding.

The MOU will go before the Del Norte Count Board of Supervisors for approval, the harbor district’s legal counsel, Autumn Luna, told the Wild Rivers Outpost on Thursday. Luna said she didn’t know when the Board would take up the matter.

Approved by voters, the initiative increased the transient occupancy tax — the extra few dollars — that visitors to hotels in the county from 8 percent to 10 percent. It also established a 2 percent tax on spaces rented at RV parks in the county.

Revenue from the increase is intended to help the Crescent City Harbor District pay down a $5.425 million U.S. Department of Agriculture Loan used to rebuild the inner boat basin following tsunamis in 2006 and 2011. Measure C dollars would also pay for repairs to the port’s facilities such as Citizens Dock and the Whaler Island Groin.

Under the agreement, the county will collect the TOT, deposit the funding into a special account and disburse it. The agreement requires the harbor district to supply the county auditor with invoices, receipts, account statements or other documents to show the amount of the loan payment made to the USDA on Oct. 15.

According to the agreement, the harbor pays $262,000 annually to the USDA.

The auditor will then reimburse the harbor the amount of the USDA loan payment between Nov. 1 and Nov. 20, according to the agreement.

The harbor district may make additional payments to cover the USDA loan, according to the agreement. If there is money available in its account, the county must reimburse the harbor the amount of that extra payment amount.

Measure C came about after harbor commissioners discussed ways to pay off the port’s USDA loan and fund roughly $11 million in needed repairs. It received 55 percent of approval among Del Norte County voters on Nov. 6, 2018.

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