Jessica Cejnar Andrews / Wednesday, Aug. 21 @ 3:42 p.m. / Economy, Infrastructure, Local Government
Harbor Commissioners Connect With CREDE, Reduce Price to $10,000; Public Input Sought On Strategic Development Plan
Harbor commissioners on Tuesday received an update on a strategic development plan that outlines different opportunities at the port. | Courtesy of Community System Solutions
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Crescent City Harbor commissioners have made a connection with “developer matchmaker” Steve Opp, of Commercial Real Estate Development Enterprises.
But after a previous experience with a developer and his now-scrapped plans to revamp the port’s two RV parks left a bad taste in their mouths, commissioners are opting for a phased-in approach to their relationship with CREDE.
This included reducing Opp’s initially proposed price of $30,000 to $10,000.
“He’s talking about giving us a month-to-month bill,” said Commissioner Rick Shepherd, who was on an ad-hoc committee with his colleague Wes White to discuss CREDE’s proposal. “So at any point in time if we aren’t happy with the results we’re getting from him, we can say, ‘OK, we’ve had enough. We’re not going to do this anymore,’ instead of throwing him $30,000 and he comes back with a plan and we go, ‘Boy, was that worth $30,000?’”
The Harbor District Board of Commissioners on Tuesday unanimously approved CREDE’s new development proposal. Representatives with the firm will create a master plan, assess market interest and analyze financial performance for various development options at the harbor.
According to an ad-hoc committee report following an Aug. 16 meeting with Opp, CREDE’s market research will focus on a hotel and cold storage, which is cited as a “potentially quick revenue-generating opportunity.” Weekly check-ins with harbor representatives are also written into CREDE’s proposal.
Both the services CREDE is providing and a strategic development plan update Mike Bahr and Aislene Delane of Community System Solutions are spearheading are paid for through a $1.35 million Harbor Mitigation Grant Program from CalOES and FEMA.
Commissioners received a second update from Bahr, who said a draft of the updated strategic development plan, along with a survey, is available for the public to read and respond to on the Harbor District’s website.
“This draft includes the proposed developments for each of the properties that have been identified as underused or vacant,” he said. “This plan really identifies areas of development and types of development that would be encouraged in the harbor as it states in the plan. Not every idea will be brought to fruition and not every idea will happen on that parcel.”
The development ideas include tourism amenities such as vacation rentals, a boutique hotel, boardwalk and shops as well as larger hotel and convention center. Cold storage and office space for operations and maintenance workers servicing offshore wind energy platforms is also in the strategic development plan.
Bahr said the cost of these developments would be paid for through private businesses as well as potential grant funding and government appropriations.
The updated strategic development plan prioritizes commercial fishing. However, both White and Commissioner Brian Stone pointed out that the harbor supports more than commercial fishing.
Stone said the Harbor District is running a deficit and to generate revenue it needs commercial assets “that are worth a lot of money” and are appropriately sited. He argued also argued that the Harbor District doesn’t end at Anchor Way -- that it stretches another 6.5 miles down the beach to Nickel Creek.
“People need to understand the size and breadth and the scope of this place and the potentials that are involved,” Stone said. “There are also other entities, like the tribe, like Hambro, like the motel down there as well as the parks as well as the Forest Service -- all of them have interests. I think we need to identify who’s what and where and make that part of the plan and decide what we’re doing with all of that property down there.”
According to Harbormaster Tim Petrick, the Harbor District’s current predicted deficit this year is $527,119, which includes $558,254 in legal payments it’s making to Fashion Blacksmith. The Harbor District will likely finance the $375,000 payment due to Fashion Blacksmith on April 1, Petrick said.
The harbormaster said he felt Stone’s characterization of the Harbor District’s “running a deficit like it’s a new thing” was a bit misleading.
“I reviewed harbor budgets going back 15 years and the harbor has operated at a deficit of $300,000-$700,000 every year as far back as I checked,” Petrick told the Outpost on Wednesday. “That was all based on operational and tax revenues and expenses. This year, when our legal settlements are removed from the budget, we are actually looking at breaking even in our operational budget for the first time since the tsunami.”
Petrick said Stone is correct with regard to the Harbor District’s size since its land grant does end at Nickel Creek, according to the California State Lands Commission.
On Tuesday, Petrick told commissioners that Community System Solutions is tasked with developing the current strategic plan, not expanding it to include the beach.
“I think it’s addressing what is currently developable space as opposed to below the high tide line,” he said. “[That’s] not currently something we have any ability to develop.”
Annie Nehmer, one of five candidates running for Crescent City Harbor commissioner this year, brought up the lease agreements the Harbor District had executed with Renewable Energy Capital developer Alex Lemus to redevelop Bayside and Redwood Harbor Village RV parks.
Lemus had plans to upgrade the landscaping and infrastructure at the RV parks as well as purchase Airstream travel trailers and cabins to encourage short-term overnight stays. However, as of October 2023, months after communication between both parties broke down, they agreed to terminate the two ground leases.
On Tuesday, Nehmer asked about the two RV parks.
“Nothing’s coming through about why the RV parks are not there,” she said, referring to the strategic development plan. “No statement was ever made as to why it’s not running. It was fine until Alex Lemus went to run the place and now, we still can’t use it?”
According to White, the infrastructure at both RV parks is insufficient.
“In order to upgrade it, it would be too expensive,” he said. “Unless we really want to make it into an RV park long term. Until we decide that, we don’t know.”
Petrick, who said the elements in the draft strategic plan are suggestions at this point, said Opp will help the Harbor District determine if developments like an RV park or a boutique hotel or offices are viable. This depends on what the “highest and best use” for those properties are, Petrick said.
“It’s all about trying to maximize the open space we have to be able to support the harbor,” he said. “I’ve examined budgets on many different harbors and harbors very rarely — even in Southern California cities — pay or are able to pay for the cost that goes into maintaining their in-water facilities. You have to have these other profit centers that drive that.”
Space at the Crescent City Harbor is under utilized, Petrick argued. Plus, there’s depreciation of almost $3 million a year, he said. He said he was referring to profit on a specific lot within the Harbor not the entire Harbor itself.
“The inner boat basin will never, and in no way will ever, pay for its own maintenance or replacement costs,” he said. “Moorage will never pay for the replacement of these docks. It doesn’t pencil. You have to make money off of your other businesses to pay for that, otherwise you throw away a harbor.”
Shepherd, a commercial fisherman and long-time Del Norter, said he had always been against major development at the harbor. He said he wanted to keep the Crescent City Harbor and Del Norte County a secret. But, Shepherd said, he realizes this puts the Harbor itself in jeopardy.
Shepherd also said any new development at the Harbor could complement Crescent City’s redesign of Beachfront Park, Front Street and the downtown area.
“This concept of getting somebody in here that brings a huge picture [that] fits in with the picture going on with Front Street and the rest of the town and bringing more people here is something that we have to do,” he said. “We’re not going to go anywhere as a community or a harbor without something like this going on.”
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