Sitka leaders and board members of the municipally owned industrial park are exploring ways the city could waive vessel insurance requirements for using its haul-out and shipyard.

A Kodiak-based company, Highmark Marine Group, operates the facility under a five-year agreement with the city. The city and Highmark require vessel insurance for boats that use the haul-out and shipyard services, but many boat owners in Sitka lack insurance.

With input from the industrial park board, the Sitka assembly could direct the city to adopt a vessel insurance waiver for people to sign before their uninsured vessels are pulled out at the boatyard.

“It’s a decision of whether we want to serve our fleet,” industrial park board member Lauren Howard said during an hour-long work session on the issue immediately preceding a board meeting on May 21.

“This extends beyond the fishing fleet, it’s a community-wide issue,” Howard said. “We want to get people to be able to work on their boats, so they don’t sink at the dock.”

Pollution and abandonment were the top concerns that city leaders and members of the public cited during the work session on allowing uninsured vessels at the haul-out.

In the regular meeting, board members agreed the city should continue developing an insurance waiver. Garry White, director of the industrial park, held up a copy of an insurance waiver he’s been drafting with city leaders.

“At the next meeting (in June), we’ll bring that forward for your guys’ consideration, and then we can start that process,” White told the board.

Board members recommended looking into ways of reducing the risks associated with hauling out uninsured vessels.

Suggestions included requiring uninsured vessel owners to post a $5,000 reimbursable bond before having their boat hauled out; charging a flat $250 fee for uninsured vessels getting hauled out, which would go into a city fund; designate an area in the shipyard for uninsured vessels; seeking character references for individuals before allowing them to haul out an uninsured vessel; and developing a contractual provision that holds the city harmless for abandoned or polluting vessels.

In the work session preceding the board meeting, City Administrator John Leach said it’s up to the assembly to decide whether to allow owners of uninsured vessels to sign a waiver to use the haul-out.

Leach said that if the assembly decides to implement such a waiver, the city will need to renegotiate its agreement with Highmark, as the current contract includes an insurance requirement.

Denise Klingler said in public testimony she recently ran her boat to Wrangell for work because Highmark does not haul out uninsured vessels.

The boat haul-out agreement for Wrangell’s Marine Service Center requires boat owners to show proof of liability insurance if their work involves “welding, cutting or open-flame work … commercial spray painting or fiberglassing or structural boat work.”

Boat owners not undertaking such work are not required to show proof of insurance to use Wrangell’s haul-out or the Marine Service Center yard.

Sitks officials have been working with Highmark on the insurance issue since November.

Highmark representative Jeremy Young held up a printed copy of an email from the company’s insurance broker, “telling us they recommend not hauling out uninsured vessels, that it would put us at risk. … it could basically ruin the company if things were to go wrong.”

Fuel or oil leaks, other forms of pollution, load issues and abandonment are major concerns in hauling out uninsured vessels, Young said.

In other public testimony, Eric Calvin encouraged the city to waive the insurance requirement. Calvin is a commercial diver who has helped raise several sunken boats in Sitka.

“You’re either going to pay for it on the front end or you’re going to pay for it on the back end,” Calvin said. “I would suggest getting them out of the water before they sink, even if the owner can’t afford it.”