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Insurance issues bedevil temporary move to former Navy hospital

Plans to move to an interim site for the coming year have hit another snag as the several parties involved in the project wrangle over insurance costs, board members learned at their July meeting.

Since the New Orleans Military and Maritime Academy will be leasing only the first floor of the former U.S. Navy hospital in Federal City, its premium should be limited to $30,000, the academy’s commandant, Col. Bill Davis, said. Insuring the six-story building in its entirety will cost $150,000. The developer, Historic Restorations Inc., is also in discussion with the Algiers Development District and New Orleans Federal Alliance to cover the rest of the cost.

State law requires property developers to insure unoccupied buildings.

“The issue at hand is that nobody wants to take the full risk of the building,” Davis said. “HRI does not want full liability for a building that’s being occupied, partly or otherwise, but NOMMA will not and cannot pay to insure the whole facility.”

The school is prepared, however, to lease the auditorium on the site, at an annual cost of $34,000, some of which will be recovered by subleasing it to outsiders for special events.

In an effort to resolve the dispute and reach an agreement, Davis and board president Col. Terry Ebbert will meet with state legislators, New Orleans Mayor Mitch Landrieu and representatives of the developer, the Algiers Development District and the New Orleans Federal Alliance.

The meeting will take place July 19 at 4:15 p.m.

Though the academy has plowed $40,000 into development of the former hospital, if a resolution cannot be reached, it will remain at its present site, augmented by portable classrooms.

In other business, the board announced that construction of its permanent home is on track to be completed in August 2013, requiring that the school delay the start of the 2013-2014 school year for a week or two.

The meeting lasted 90 minutes.

The board has yet to set a date for next month’s meeting.

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