The Del Norte County Board of Supervisors on Tuesday declined to approve the Crescent City Harbor District's facilities plan, leaving the item to be brought back after the harbor provides clearer accounting and revisions. The board's concern centered on whether Measure C tourism‑occupancy tax proceeds had been used to satisfy a USDA loan payment the plan lists as already made, when the payment has not in fact been completed.

Harbor fiscal staff said the harbor's Tourism Occupancy Tax (TOT) account held about $290,000 as of June 30 and that first‑quarter receipts could add roughly $80,000; they said the harbor was negotiating with USDA to accept a reduced payment—proposed as 10% ($26,000) for the next three years—to ease cash‑flow constraints while pursuing reorganization and grant funding. Harbor representatives emphasized that approving a facilities plan would position them better to secure grants and reimbursements.

Board members and multiple public speakers pushed back. County counsel and several supervisors pointed to the Measure C language and the county's role in ensuring that TOT funds be spent first to repay the USDA loan. Supervisor comments and public testimony repeatedly stressed that the harbor has not yet made the loan payment and that Measure C was framed to prioritize that payment before other uses.

Public commenters and several harbor critics also raised allegations of mismanagement at the harbor district: late or missing insurance, depleted reserves compared with previous years, a pending arbitration settlement with Fashion Blacksmith they estimated at about $4.5 million plus interest, and possible conflicts of interest involving harbor staff. Harbor officials acknowledged the difficult financial position, described ongoing negotiations with USDA, and disclosed they had proposed a multi‑pronged plan (including maintaining a reserve, creating a self‑insured account, and negotiating loan terms) to stabilize operations.

County counsel and supervisors said the harbor facilities plan, as presented, lacked a clear priority list, project timelines, or cost estimates and therefore fell short of what the board expects before authorizing use of Measure C funds for projects. Several supervisors recommended tabling the matter or taking no action so the harbor may return with a more detailed, prioritized plan and formal documentation of any USDA agreement; the board took no approval action at the meeting.

The most immediate formal step that remains is for the harbor to provide audited accounting and written assurances about the USDA negotiation and to revise the facilities plan with specific projects, timelines and estimated costs. County counsel noted the board's obligation under Measure C to ensure the TOT is spent for its intended purpose.

Where it stands: no action taken; item to be returned with additional documentation and a more detailed, prioritized facilities plan.