HomeMy WebLinkAboutSS04 - Mooring RatesStudy Session
August 9,1999
Item No. 4
To: Mayor and Members of the City Council
From: Tim Riley, Fire and Marine Chief
Subject: Mooring Rates within the City of Newport Beach
ISSUE:
Does the City Council wish to adjust mooring rates?
BACKGROUND:
At the July 12,1999, City Council study session, Councilmember Ridgeway asked staff to
bring back the mooring rates and fee adjustment issue that was presented at the March 8,
1999, study session. As a council member participant on the City Council Ad Hoc Harbor
Committee, Councilmember Ridgeway has received significant feedback from the Newport
Mooring Association regarding this issue. The Newport Mooring Association believes the
mooring rates charged by the City of Newport Beach are both excessive compared to other
mooring rates along the California coast, and inconsistent with the rates charged other
Tidelands users in Newport Beach. They also feel the City of Newport Beach provides
minimal amenities for mooring users compared to the high rate schedule.
MOORING RATES:
Onshore and offshore moorings occupy State Tidelands and are administered through a City
permit system. Fees for mooring permits are established by resolution of the City Council
based on Section 17.22.050 of the Municipal Code. As a State Tidelands trustee, the City
"must, at the minimum, establish lease and permit raises which are reasonably consistent with
those charged for land of similar location and value or for uses of similar nature."
The current mooring fees have been established and maintained consistent with the trust
guidelines. In 1974, the State Lands Commission audited the City for compliance with the
State Tidelands Trust. As a result of the audit, the City was advised to adjust its mooring rate
from $1.20 per foot per year to $6.00 per foot per year. The $6.00 rate was established in 1975
and has been adjusted over the years roughly based on the Consumer Price Index. The most
recent adjustment was five years ago, 1994, which established the current offshore mooring
rate at $20.00 per foot per year. Since 1994, the CPI has increased as follows: 1995 = 1.4 %,
1996 = 2.4 %,1997 =1.8 %,1998 =1.4 %, 1999 = 2.0, or a cumulative 9.3 %.
A March 8,1999, staff report titled "Tidelands Administration," included an exhibit that
listed eight jurisdictions that administer offshore moorings and what their relative rates were
for the mooring of a 40 -foot vessel. City staff has updated and augmented that exhibit and
attached to this report as Exhibit A. It has been expanded to illustrate the current annual rate
for the offshore mooring of a 40 -foot vessel (in blue) and the annual cost to moor the same
size vessel at a slip (in red). Included below each harbor name is the percentage of the annual
mooring rate in relation to the annual slip rate; an average of 15 %. This exhibit illustrates the
fact that it is much more expensive to berth a vessel in Newport Beach than any other areas
that have offshore moorings. However, it also illustrates that Newport Beach has the lowest
mooring -to -slip ratio (10 %) than any other area.
MOORING AMENITIES:
Exhibit B illustrates the amenities offered in the jurisdictions that provide offshore moorings.
With the exception of the County of Orange, Newport Beach offers the fewest amenities of all
surveyed areas.
IMPACT ON MOORING REVENUES:
Based upon the current $20.00 per foot per year fee for City moorings, the City realizes
$540,040 revenue per year. Should the City Council adjust the mooring rates up by $2.00 per
foot per year, the City would realize an additional $54,004 in annual revenue. Should the
City Council adjust mooring rates down by $2.00 per foot per year, the City would realize a
decrease of $54,004 in annual revenues.
TIDELANDS USER EQUITY:
The Newport Mooring Association also feels the mooring rates have been unfairly adjusted
upward while others have been kept down. The March 8,1999, staff report also included
Exhibit C (attached for your review), which illustrates the income the City of Newport Beach
receives from various tidelands sources.
As directed at the March 8, 1999, study session, staff is developing a Request for Proposals
document that provides for a comprehensive appraisal of all commercial permits to
determine if they are being properly assessed through our permit fee schedule and /or if they
should be converted to tidelands leases. This item is tentatively scheduled for City Council
consideration on September 13, 1999.
STAFF SUMMARY:
According to the State Lands Commission, mooring rates should reflect the market for
berthing vessels in our area. As a market, Newport Beach is unique and thus slip rates are
comparatively higher than others. As a consequence of local market forces, mooring rates
will be higher than elsewhere. However, as a percentage of local slip rates, Newport Beach
remains below the 15% coastal average at 10 %.
Mooring user amenities are appropriately addressed by the Ad Hoc Harbor Committee and
should be considered by the City Council as part of a comprehensive report on all harbor
uses unless the City Council directs staff otherwise. L
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• EXHIBIT C
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Tideland User Fee Comparison
Tidelands users pay the City different fees annually based upon the nature of
their use and the particular mechanism (lease, permit, etc.) with which they
occupy the water area. Based on a 40 foot vessel, the graph below illustrates
what a tideland user would pay the city annually for their tidelands use.
Type of Permit/Use Fee per year
• Commercial permit (Lido Marina Village)
• Non - commercial pier (residential)
• Offshore mooring
• Leases
Bahia Corinthian Yacht club (water only)
American Legion (land and water)
• City run marina (Balboa Yacht Basin slip tenant)
$9,000.00
$8,000.00
$7,000.00
$6,000.00
$5,000.00
$4,000.00
$3,000.00
$2,000.00
$1,000.00
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$224.00
$75.00
$800.00
$437.50
$1,980.00
$7,680.00
($7,680.00„
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$224... — $800.00;` $437.50'
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