Port Is Deep in The Red, With Urgent Needs to Spend

By Mike Lednovich

The Port of Fernandina is suddenly awash in hundreds of thousands of dollars in expenses that came to light at last week’s Ocean Highway Port Authority meeting.

OHPA commissioners were made aware of the pending bills as a result of legal fees, mandated vessel inspection costs and necessary roof repairs to one of the port’s primary warehouses.

Commissioner Ray Nelson, who heads the port’s maintenance efforts, made the stunning announcement that the port’s tugboat was mandated to undergo a U.S. Coast Guard “haul out” inspection.

“There is an issue with the tugboat. There is an inspection issue under a critical deadline of Aug. 31 for a haul out inspection and if it is not done the tugboat will be taken out of service until such time as it is inspected,” Nelson told commissioners. “I know we’ve got a problem and we’re trying to work this out as quickly as possible so we don’t have any commerce interruption.”

Nelson said estimates for the inspection are between $75,000 and $100,000.

A “haul out” inspection means the tugboat will be placed in a dry dock facility and the vessel’s hull integrity reviewed by a certified Coast Guard inspector.

“Right now we’re trying to figure out the where and the when that the inspection can take place,” Nelson said.

Ironically, Nelson revealed the tugboat had recently been in dry dock at a shipyard in Palatka to have its hull repainted.

“When we had the tugboat in dry dock the Coast Guard was not notified, so the inspection was never done,” Nelson said.

Port Accountant Pierre LaPorte said there currently are insufficient funds in the port’s maintenance account to pay for the haul out inspection.

“(On) maintenance, the first $15,000 (paid) is to the (port) operator the rest (balance) to OHPA. If OHPA doesn’t have the funds and the operator still wants to use the equipment, then the operator has to put up the funds,” LaPorte explained.

The port operator, Savage Services, did not comment on the tugboat issue.

Nelson then went into the roof panels of warehouse number 3, which is one of the port’s primary storage facilities.

“We have some heavy, severe corrosion areas on the roof panels of warehouse number 3 that’s going to require some pretty quick attention,” Nelson said. “Right now we’re patching the panels but in fact we’re patching the patches. This could have a big impact on this warehouse where we store wood pulp. We need to get roof panels in place so we don’t have any cargo issues.”

Nelson did not give any estimates of the roof panel replacement costs.

“This is obviously a deferred maintenance issue if we’re patching patches,” said Commissioner Miriam Hill.

Port Director David Kaufman said, “This goes back to OHPA not having money for maintenance.”

Roof panel replacement can cost as much as $18 per square foot.

During a review of OHPA’s financial report, Hill dug into the port’s mounting legal costs in defending several ongoing lawsuits.

“Because the legal items were getting so large we added the unpaid legal fees to the report just so you understand the extent of the spending. The $104,000 is unpaid legal fees. We haven’t had the cash flow to pay it yet,” LaPorte said.

One of the ongoing cases is the city of Fernandina Beach and the issue of yearly $50,000 PILOT (Payment in Lieu of Taxes) to the city. OHPA stopped making the payments in 2018 claiming the PILOT requirement with the city had expired.

OHPA’s attorney said the city was prepared to discuss a possible settlement of the case and said commissioners should plan a meeting to discuss the settlement.

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Richard Ireland
Richard Ireland (@guest_68572)
1 year ago

Hmm. Sounds like rejecting some easy money from those very wealthy, small, short-stay cruise ships so the mostly mature and wealthy passengers could spend some money downtown was a short sighted decision.

Peggy Bulger
Peggy Bulger(@peggy-bulger1949gmail-com)
1 year ago

This doesn’t surprise me. What a mountain of mismanagement!!

James brooks
James brooks(@james-brooks)
1 year ago

With jax so close, what is the rationale for keeping the fernandina port open? It appears to struggle to find profitability.

Troy Walker
Troy Walker (@guest_68580)
1 year ago

Like a soap OHPA, this port.

Carlos Londono
Carlos Londono (@guest_68582)
1 year ago

I do not see any comments regarding minimum requirements on heavy equipment that a Port should have , so if it’s got a problem with a tug Boat you can imagine the rest.

Captain Bill
Captain Bill (@guest_68719)
1 year ago
Reply to  Carlos Londono

How do you know what equipment a Port this size should have and how do you know what equipment it does have?
You don’t!

Bill Fold
Bill Fold(@bill-fold)
1 year ago

Incompetence abounds at the OHPA. If you don’t have a place locally to dry dock a tug, then obviously you shouldn’t have a tug, or much of a port for that matter.

Captain Bill
Captain Bill (@guest_68720)
1 year ago
Reply to  Bill Fold

The only place to drydock any marine vessel is in Jacksonville. There is not enough business to have one here. Do your homework before you criticize. Kinda shows your intelligence.

Sandra Lerch
Sandra Lerch (@guest_68588)
1 year ago

It figures. So much incompetence. No organization skills.

Captain Bill
Captain Bill (@guest_68721)
1 year ago
Reply to  Sandra Lerch

How many of their meetings have you been to. My guess is none. Stop getting you opinion from fake news or rumors.

Last edited 1 year ago by Captain Bill
G. Miller
G. Miller(@george-miller)
1 year ago

Interesting, Mike.