Oak Harbor council weighs dredging, breakwater and fee options to stabilize marina

Oak Harbor city staff laid out a menu of repair and replacement options for the Oak Harbor Marina on July 22 and asked the City Council for direction on which projects to pursue and how to pay for them. David Goldman, the city’s deputy administrator and finance director, presented cost estimates and financing scenarios that range from maintenance dredging to a full marina redevelopment and include potential new fees, local taxes, district formation and federal grants.

The presentation said the projects fall into three groups: dredging, a breakwater repair or replacement, and dock repair or reconfiguration. Goldman gave estimated construction costs and annual debt-service amounts for each option. For dredging, he reported a range of about $10 million to $13.2 million (inflated to 2026 dollars in the city’s materials) and noted the council previously “made the motion to pursue the maximum option as a preferred option.” The city has a $1,000,000 grant agreement with Allen County that “reduced the amount that we need to borrow,” Goldman said. He also described a roughly $5.5 million maintenance dredge projected for about 2036 and noted that setting aside about $410,000 per year now would fund that future maintenance without borrowing.

Goldman said the council’s consultants had advised that marine-construction work must respect a fish window (roughly mid‑August through mid‑February) and that good contractors tend to book early in the spring, a schedule constraint the council repeatedly cited in discussion.

Nut graf: The council discussed combinations of smaller immediate repairs versus larger replacement projects and several revenue mechanisms — increasing the marina dredging fee, establishing a new breakwater fee, a business-and-occupation (B&O) tax, utility taxes, property‑tax levies, forming a port district or a metropolitan park district, and pursuing federal grants — but did not adopt any ordinance or take a binding vote at the workshop.

Most urgent items and costs: Goldman presented two breakwater paths: a full replacement estimated at $8.3 million to $10.7 million (he applied a conservative contingency and used the higher figure in debt calculations), with a 30‑year suggested term and an estimated annual debt service around $760,000 at the high end; and a repair/renovation option estimated at about $5.6 million with a 20‑year debt term and annual debt service near $390,000. Dock work had two options: a full reconfiguration and redevelopment estimated at about $34.2 million or a repair/renovation option estimated at about $9.3 million. Goldman estimated the Marina Fund had roughly $1.9 million in unrestricted net position at the end of 2024 and identified line‑items that could be repurposed to buy down borrowing needs.

On user fees, Goldman explained the existing dredging fee (about $60 per foot at the time of the presentation, scheduled to increase to $69.12 per foot in October) currently raises about $235,000–$250,000 annually and could be raised further. He and staff demonstrated a spreadsheet model showing how different combinations of fees and taxes would affect an average 32‑foot slip: fully funding the largest dredging and breakwater options with rate increases could more than double a typical monthly uncovered 32‑foot slip payment (from roughly $400 to as much as $835 in the hypothetical shown).

Council discussion and options: Councilmembers differed over whether to pursue a large, long‑term rebuild or to limit spending to operationally critical projects. Several members urged a mixed approach: pursue the immediate operational needs (dredging and breakwater repair or targeted replacement) to preserve navigation and protect harbor structures, then use the next decade to refine plans and funding for any full redevelopment.

Funding mechanisms were a central part of the debate. Options discussed included: - Raising the existing dredging fee and/or introducing a new breakwater fee applied per‑foot; Goldman showed how each $100,000 of new dredging/breakwater revenue translates into roughly $27.66 on the 32‑foot monthly slip rate in his model. - A business‑and‑occupation (B&O) tax at different exemption thresholds (Goldman presented several thresholds: $5,000,000, $2,500,000, $1,000,000, etc.) with estimated annual revenues that vary by threshold; staff noted collection and administrative costs would apply. - A council‑imposed utility tax (councilmatic for city utilities) or voter‑approved extensions for other utilities. - Property tax options including a levy lift (50%+1 voter approval) and excess levy bonds (60%+1 voter approval with validation) that could raise recurring revenue or provide bonding capacity. - Creating a port district or a metropolitan park district (MPD); staff outlined formation steps, potential millage capacity, and that those entities can borrow and levy taxes but that they would be separate legal entities. Staff noted special conditions tied to the state Department of Natural Resources (DNR) lease: assigning the DNR lease to another public entity would require DNR permission and, according to staff, a DNR condition would be sale of abutting uplands if the lease were assigned to a port district.

Grants and timing: Goldman described two federal grant opportunities staff were pursuing: a U.S. Department of Transportation request up to $11.5 million with a 20% local match (application due Sept. 10) and a U.S. Economic Development Administration application for up to $10 million for breakwater replacement with a typical 20% match (waiver potential noted). Staff said decisions on awards could take from months to nearly a year; councilmembers and staff repeatedly noted that delays raise the risk of losing contractor availability and likely increase costs.

Public‑interest and policy context: Consultants (identified in the meeting as “Moffett and Nickel”) provided a memo the city included in its packet; Goldman summarized the memo’s conclusion that long rock structures extending beyond the shoreline likely would not be a cost‑effective alternative and could worsen shoaling inside the marina. He also relayed that the U.S. Army Corps of Engineers indicated that if a tribe objects to a proposed breakwater outside the current footprint, the Corps cannot issue a permit for that project.

What the council did and did not do: The meeting recorded no formal vote on funding, tax measures or district creation. Councilmembers debated immediate vs. long‑term approaches and several expressed a preference for preserving the marina with a mix of revenue sources rather than closing it; a few also noted restoring the basin to mudflat and monetizing mitigation credits had been studied but that restoration would eliminate future development options for the basin.

Quotes from the meeting: “There’s some details applicable to all the projects. There’s a fish window, between approximately mid August to mid February, when any kind of work on the water must be done,” David Goldman said. Councilmember Romero said: “For this council member, the decision making with regard to the marina redevelopment… it boils down to the questions that are clearly right on, those that are negotiable, and those that are far off.” Goldman summarized grant timing and scope: “We have a request that we’re looking to put in for $11,500,000 for the U.S. Department of Transportation. There’d be a 20% match. The due date is September 10.”

Next steps and outlook: Staff said they will continue to refine scenarios in the shared spreadsheet model, pursue federal and state grant funding, and return with more detailed recommendations. Several councilmembers urged placement of a B&O tax item on the council agenda for an August 6 decision; others urged waiting for grant decisions in December before pursuing new local taxes. No final policy decision was made at the workshop.

Ending: The council moved on to other business after an extended discussion. Staff emphasized the timing constraints (fish window, contractor availability and permitting timelines) that make near‑term choices consequential for work planned in 2026–2028.