Fernandina Port “At a Crossroads” Amid Tax, Contract Concerns - Authority Vice Chair states

FERNANDINA BEACH — Ocean Highway and Port Authority (OHPA) Vice Chairman Scott Moore issued a pointed warning about the future of the Port of Fernandina, telling fellow commissioners the agency is “at a crossroads” and burdened by a flawed operating agreement that is costing taxpayers millions.

“OHPA is at a crossroads, and it has taken a long time to get here,” Moore wrote. “While OHPA must accept its share of responsibility for the situation we now face, we are not alone in creating it.”

“For years, OHPA has allowed itself to be consumed by the Port of Fernandina and nothing else,” Moore wrote, adding that the focus has yielded “almost nothing for the citizens of Nassau County beyond roughly 25 jobs.”

The Observer has reported that the agreement with Relay Terminals — originally intended to stabilize port operations — has instead led to repeated disputes between the authority and the operator over control, revenues and compliance.

Worldwide Terminals operated the port in 2018 and negotiated the current operating agreement. Worldwide was replaced by Nassau Terminals (which later became Savage) in 2022 and then Relay Terminals took over in 2025.

A central issue raised in Moore's statement is the port’s loss of tax-exempt status — a problem the Observer has extensively covered in recent years.

That loss has exposed the port to significant financial liability. Moore cited “roughly $3 million in back taxes” already owed, along with an estimated “$600,000 every year going forward” if the issue is not resolved.

The Observer previously reported that the tax dispute stems from how the operating agreement allocates control and benefits between OHPA and Relay Terminals — a structure that courts have determined undermines the authority’s governmental tax exemption.

Moore rejected arguments that the court rulings were flawed.

The statement also highlights continued friction with Relay Terminals, which has offered to fund OHPA’s legal appeal of the tax ruling.

The Observer has previously detailed disputes between OHPA and Relay over operational control, financial transparency and strategic direction for the port. Those tensions have contributed to a broader debate over whether the current agreement serves the county’s long-term economic interests.

He called for moving “away from a port-only mindset,” diversifying revenue streams and strengthening oversight to reduce reliance on a single asset.

“For the remainder of my service, I will vote to do what I was elected to do: provide oversight to the port while shifting OHPA away from a port-only mindset, diversify our revenue streams, and build an authority capable of withstanding the political and economic pressures that come with relying on a single asset,” he wrote.

The issues outlined by Moore — tax exposure, governance structure, and operator disputes — have been recurring themes in Observer coverage and remain unresolved as OHPA considers its next steps, including whether to continue legal appeals or renegotiate its agreement with Relay Terminals.

OHPA's April 8 meeting, which Moore missed, supported many of his claims. At that meeting:

• OHPA commissioners were again informed that Relay Terminals had denied their request to make changes to the operating agreement.

• There was more bad news as Port Comptroller Pierre Laporte told the board that funds needed to pay the city of Fernandina Beach its $50,000 annual Payment in Lieu of Taxes commitment were lagging far behind. OHPA had collected only $18,000 of the payment due in October with six months remaining, leading commissioners considering an increase in fees to make up the shortfall.

• A proposal to lease port dock space - called layberthing - for 40 months in a deal negotiated by Relay Terminals to bring more revenue - was voted down by the commission. Chairman Ray Nelson said the agreement would turn the port into a "ship repair boatyard."

• OHPA and Relay Terminals argued over $3 million of improvements needed to upgrade the U.S. Customs house. The agency has said it will abandon the port and move to Jacksonville if the renovations don't take place. OHPA is relying on potential state funding and contributions from Relay Terminals to fund the project. But the port operator said it is limited in the amount it is willing to contribute to the project.

In his letter, Moore also directly addressed the authority’s ongoing legal strategy, stating he cannot support continuing appeals tied to the port’s tax status without addressing the underlying agreement.

“We have heard the same assurances from our legal team that they ‘feel good’ about our chances on appeal,” Moore wrote. “We know how that ended” in prior rulings, adding that the port operator has refused to renegotiate the operating agreement to address the court’s concerns.

“I cannot in good conscience support continuing the appeals process,” he wrote.

“I must respectfully but firmly question that advice,” Moore wrote, emphasizing that OHPA is not solely a port authority but a legislatively created body responsible for broader economic development across Nassau County.

“To step back from oversight, as suggested, would be to abandon the very responsibility the voters elected us to fulfill,” he added.

“OHPA has placed all its eggs in the Port of Fernandina basket and, in doing so, has effectively surrendered control of the port to the operator,” he wrote. “Under those conditions, hiring a Port Director is pointless.”

Instead, Moore said any savings from potential salary reductions should be directed toward hiring a business development manager to expand the authority’s role beyond the port.