Before asking her colleagues to consider taking protective action against potential insolvency, Crescent City Harbor Commissioner Annie Nehmer stood at the podium, invoked state and federal whistleblower laws and said the port may run out of cash within four to nine months.
There’s been no spending freeze or emergency budget discussion, Nehmer said, and the Harbor District Board in April gave their CEO a $24,000 raise “without disclosing the financial impact or explaining the decision to the public.”
Nehmer urged her colleagues to think twice about continuing to employ Harbormaster Mike Rademaker and voted no when, at the end of a closed-session meeting Wednesday, they finally approved his five-year contract.
“The harbormaster remains under investigation for misconduct, including the falsification of public records, yet he continues to handle sensitive materials and public requests,” Nehmer said. “I’m formally requesting the harbormaster position be publicly posted and placed on the agenda for open discussion. This has been requested by members of the public and myself and is critical to uphold transparency and avoid the further appearance of favoritism.”
The Harbor District Board voted to keep Rademaker on for another five years at the $114,000 annual base salary they agreed to back in April — an increase from his previous $94,000 wage when he became interim harbormaster in October.
Commissioners on Wednesday also decided to reduce the amount of severance pay Rademaker would receive upon termination from a maximum of 18 months to between three months and up to six months. Rademaker would receive housing in lieu of health insurance, however if he chooses to seek his own housing, the Crescent City Harbor District would cover up to 75 percent of his healthcare costs, according to Board President Gerhard Weber.
The Harbor District will also provide a workplace cell phone, Weber said.
Rademaker was hired as a paralegal in 2019. He became assistant harbormaster in 2022 and interim harbormaster in October when his predecessor Tim Petrick resigned amidst allegations of credit card misuse.
On Wednesday, the misconduct allegations against Rademaker came from Linda Sutter, who ran against Nehmer, Dan Schmidt and John Evans in 2024 for a seat on the Harbor District Board.
After reading from a New Year’s resolution she said Rademaker authored and the Del Norte Triplicate printed, Sutter accused the harbormaster of falsifying California Public Records Act documents. She also said Commissioner Dan Schmidt suggested at a public meeting that those investigative documents be destroyed.
Sutter referred to California Government Code 6200. Under California Government Code 6200, any public official who destroys, alters or falsifies a public comment could be subject to imprisonment of two, three or four years.
“On May 9, Mr. Rademaker authored a memo to each and every one of you that [stated], ‘We need to confer regarding ongoing matters involving Linda Sutter, including the recent CPRA request to BBK [for the] HR report,’” Sutter said, reading from the email and referring to the Harbor District’s previous legal counsel, Best Best & Krieger LLP. “‘The report was discarded at the suggestion of Commissioner Schmidt and consistent with the consensus expressed by the Board at the public meeting…. As such, the report no longer exists within CCHD [records] and did not exist at the time when Sutter submitted the CPRA request.’”
Sutter continued accusing the Harbor District Board of “willful premeditated destruction of public records” before Weber cut her off saying the 3 minutes she had to speak were over.
At the end of his report to the Board of Commissioners Rademaker accused Nehmer of making “a point of political theater.”
“I just have to say, you know, I have five bosses and I regret that I haven’t been able to gain her confidence,” he said. “And I think having five bosses if one is sort of off base, you have four that are reasonable that he can work [with].”
At this, Rademaker was cut off by members of the public who took issue with his comments.
One commenter, who didn’t give his name, turned to Nehmer’s colleagues.
“You five up here are his bosses, right? And you let him talk to her like that?” he said. “This lady should get an apology from this guy.”
Rademaker later apologized to Nehmer for his statements.
In an email to Redwood Voice Community News on Thursday, Rademaker forwarded the May 9 communication with the Board of Commissioners that Sutter referred to during her public comment the day prior. According to Rademaker, BBK still has the report that Schmidt referred to. In the email Sutter referred to, Rademaker said, it was still an open question whether to release the report to the public.
In the May 9 message to commissioners, Rademaker stated that BBK was still reviewing the Harbor District’s records, management policy and “any relevant statutes and case law.”
“They are preparing an advisory opinion for consideration at the closed session [meeting],” Rademaker told commissioners, referring to a May 14 special meeting held prior to the Harbor District’s regular session. “At this time, the report cannot be released unless a majority of the Board directs me to obtain another copy from BBK and make it available to the public.”
In his Thursday email to Redwood Voice, Rademaker called Sutter’s claims hyperbolic.
“There is absolutely nothing improper about this email notwithstanding her claim that it somehow constitutes evidence of a felony,” he said. “That claim is not only hyperbolic, it reflects a clear misunderstanding of the facts and applicable law.”
Rademaker said he also regretted the way he reacted to Nehmer’s comments on Wednesday and stands by his public apology.
“No matter how difficult the circumstances, it’s important for me to model professionalism and restraint, especially in a leadership role,” he said via email. “That said, I hope it’s also understood that my comment was made in the heat of the moment in response to a serious, and in my view, unfounded public accusation.”
After Rademaker’s May 9 communication with commissioners, the Crescent City Harbor District hired new legal counsel, Ryan Plotz, of the Eureka-based Mitchell Law Firm.
On Wednesday, in her first report before the Harbor Board, Sandy Moreno, who was hired as the district’s finance director in April, was more optimistic than Nehmer about its finances though she agreed that its situation is still precarious.
According to Moreno, the Harbor District has about nine months before it’s insolvent. In her report, when discussing profit and loss, she said the Harbor District had received about $1.7 million in income and had about $2.7 million in expenses for the year. But, she said, she would be able to paint a more complete picture on June 11 when she presents the draft budget to the Board.
“I’m hopeful that what we present to you is maybe a small need of the reserves to fund us through this [fiscal] year and to be able to show you month by month how we’re doing exactly what we said [we’d do] in the budget,” she said.
Moreno also urged the Harbor District Board to let her remove data and numbers tied to the port’s grants from their operating budget and put it in a separate category. She added that talk about bankruptcy doesn’t help either.
“I think it’s premature to say something until you’ve seen what the numbers look like,” she said. “It may not be as bad as we think.”
Despite Moreno’s caution, Nehmer said insolvency is still looming. She urged her colleagues to consider taking protective action under Chapter 9 bankruptcy.
According to United States Courts, Chapter 9 bankruptcy allows for the reorganization of municipalities, including special districts, and provides protection from its creditors while its officials figure out how to address its debt.
Nehmer said that seeking Chapter 9 bankruptcy protection doesn’t mean the Crescent City Harbor District “won’t be here,” though another agency, perhaps the state, might take over its operation “if we can’t figure it out.”
“We have a duty and an obligation as a Board to investigate and to figure out what we’re supposed to do before we’re at zero,” she said. “And in that spirit, if our budget shows that we’re not at a break-even point… as commissioners, we should probably lead the way in suspending commissioner pay to lead the way and gain financial stability.”
Rademaker said there are steps the Crescent City Harbor District can take before it gets to the point of financial insolvency. One option, he said, might be to restructure the U.S. Department of Agriculture loan that helped rebuild the inner boat basin after the March 2011 tsunami.
