Where someone may be referred to by last name only, no disrespect is intended; this is done merely for expediency.
Standing room only crowd of 93 persons at Oasis. [At least one person walked out of meeting because could not hear in back of room. –ed.]
Avery: Any changes to transfer, fees, will be recommended to City Council who would act on (approve) changes.
Meeting focus on fees following dramatic rise in rate over last 5 years. Interested in solutions that will work for all parties; be fair.
Girling: Reviewed Scott Karlin’s mooring fee analysis of San Diego, thought it helpful.
Q: Why charge fees?
Avery A: Support harbor maintenance. Avery quotes need to charge
fair market value which City decides is
Q: John Burzan asks about MMPSC work….has it been looked at?
Avery A: Yes, we have reviewed it.
Bill Moses clarifies John Burzan’s comments about document loosely called the
Avery mentions overall fairness is the goal.
Q: (Speaker?) Do increase in fees violate proposition 218 which says fees charged have to relate to the cost of providing the service?
Duncan McIntosh notes City Council willingness / support to moderate fees, as has been done for dock owners.
Girling comments about methods of valuation, CPI adjustment versus comparables with adjustments – two methods. Asks whether there are other areas [with moorings -.ed] which should be included in the analysis.
Wallace Cook – 23 years Newport / 27 years Avalon mooring permit holder. Cook remarks that Newport permit fee is much, much higher than in Avalon [(about $55/ft/year in Newport versus about $10/ft/year in Avalon -ed.)]. States PIT assessed for Avalon mooring about $1000. Cook notes his Avalon mooring could sell for $300k or higher. Drives toward notion that tax rate in Newport (fees as percentage of mooring value) is 7x higher than Avalon. Supports open market, transfers. Notes Avalon booked $300k in transfer fees in 2013 which Cook reports is 10% of mooring values transferred [he reports incorrect rate; read on -ed.]. Mr. Cook supports Avalon model. Suggests we don’t know what property tax rate [He means
PIT -ed.] is in Newport, feels that the fees assessed already include the property tax. [He is misinformed… there is no PIT assessed on Newport moorings. –ed.]
Avalon trusts values reported for transfers.
McIntosh asks what value does Cook attribute to facilities he enjoys in Avalon. Cook replies that he belongs to a yacht club so does not depend on public facilities.
Carter remarks about Avalon model. Carter says transfer rate is 5%, not 10% [reverified 2015-03-10 by Carter Ford speaking with Cheryl Allison, Avalon Harbor Administrative Assistant -ed.]. Avalon operates a website on which permit holders may voluntarily advertise mooring for sale, though people are free to advertise how they prefer, using Craigslist or whatever. Avalon mooring values are in such higher value ranges that County assesses PIT, whereas Newport mooring values are so low, likely not worth the trouble.
Speaking to Karlin’s comparable analysis and Newton’s CPI analysis. Carter mentions NMA survey of mooring fees from Pillar Point to San Diego. Another means of comparison is to compare uses for private residences versus moorings….e.g. the 50 cents / sq. foot awarded to pier permit holders. Residents not charged in some cases for every square inch because not exclusive use.
Carter reports that using a 50 to 55 cents / square foot, value comes in at under $20 / foot / year. Clarifies that mooring permit fees are now 200% higher, not 300% higher than in 2010. [common mistake people make when talking about percentage increases -ed.]
Megan Delaney remarks about cost of services studies and commends both the analyses of Karlin and Newton. Also commends the two studies for coming in at nearly the same number. She comments about the private investment which created moorings, they were never installed by the City, but rather by private people. Brad observes Washington State still lets people place moorings for free.
George Hylkema remarks that all boats use the tidelands in the same way, no reason to discriminate among uses or users. [State Lands Commission requires no discrimination in rates, tolls, charges, which is plain language. -ed]
Gentleman suggests the mooring should be an easement.
Dan Gribble wonders whether PIT suggests there is real property being taxed […Possessory interest tax is sometimes charged on private use of public assets, such as boat slips at City–owned Balboa Yacht Basin. Its purpose is to return value to public for individual’s mere temporary possession of a public asset. County 2010 report, City mention, Assessor’s Handbook § 510. -ed.]
Avery says people can turn mooring in to City and City will reimburse permit holder for value of chain and train wheel or whatever.
Brian Ouzounian remarks that there is no formula State Lands uses to determine what is the FMV for tidelands use. Ouzounian suggest applying the 50 cents/foot on the shadow the boat casts on the bottom of the harbor. He asks is the objective to fairly price the tidelands? Avery confirms. Ouzounian says
the rent is too high. Offers we don’t have to keep up with every harbor in terms of pricing.
Tom O’Keefe speaks about having mooring since 1942. He asks is the objective to raise highest revenue that market will bear? Is that strategy legal under proposition 218? Prop 218 talks about fees or taxes for services. Says it was written to prevent municipalities to just start calling everything a fee to sidestep the issue that raising taxes requires votes. Avery suggests O’Keefe contact the City Attorney with his proposition 218 question.
Bret Forché (?) remarks in the past paid for length of boat, not length of mooring, would like to see fee calculated on this basis.
Nigel Bailey (H-310) disagrees, says you’re taking up the space between the two mooring cans, so should pay for the whole thing, not just the boat length.
Commenter urged moving away from slip/marina index. Ouzounian suggests 50 cents / square foot [private dock rate -ed.] should be discounted for moorings because mooring is much harder to use than slip.
Megan Delaney notes that what is actually paid for marina / slip is not what is advertised. What about the philosophy of basket of fees of marinas for determining mooring fees? Too many differentiating factors slips to moorings.
Patricia Newton speaks about her CPI analysis from 1970s using LA, Orange, Riverside Metro Area. Arrives at $25 / ft / year linear basis for present mooring fee. Bill notes that City adjusts many fees using CPI.
Carter notes that mooring fees were adjusted more incrementally than supporting documentation reveals today. A dollar here, a dollar there was what actually happened.
Megan notes that mooring fees were not part of City’s Master Fee Schedule and that’s why the mooring fees went for many years without adjustment.
Patricia notes that transfer fee also impacts overall value proposition of a mooring. It’s not just annual permit fee that affects value.
Avery notes that previous City Council termination of transferability and tripling of fees hammered value. Further notes that if City Council adopts CPI basis, needs to be regularly revisited. Need to set a public policy that is responsible and fair, that people pay enough, etc. Fairness from arm’s length.
Newton remarks that there is not realistic opportunity for profit taking or making.[Newton is the person who received email from City Attorney Aaron Harp stating that mooring transfers are not a legal question but a policy question to be decided by council. Avery still tender about the concept of profit on mooring in terms of political problem down the road. -ed.]
Avery thinks profit opportunity is a problem to City. Avery thinks transparency of process is important.
Dan Gribble asks what does it cost for City to provide the services that the tidelands need? Avery notes Duffy initiative to parse harbor costs out from overall tidelands expenses. Avery points out periodic operational costs of harbor are substantial.[Should mooring permit holders carry the major cost of dredging? Are moored boats the major reason for dredging? Would City still dredge harbor if there were no moorings? -ed.]
Question of commercial use (e.g. money-making private enterprise use) versus private mooring permit holder….are usage fees paid by commercial uses; when last adjusted? [She is speaking to the point that mooring permit holders make no money from use of tidelands, fee structure should reflect that. -ed.]
Gentleman points up reasonableness need. Suggests transfer fee should be tied to annual fee. Avery asks is 5% transfer fee too high? (Rhetorical question). Currently transfer fee is 50% of annual permit fee.
Jim Gross endorses CPI basis for mooring fees because it’s widely familiar in City.
Sidebar on Gross’ perspective on previous elimination of transferability.
Don Beatty remarks on fees, asks for $25/ft/year and suggests future increase be based on actual City needs.
Jamie Whitworth (sp?) 15th Street vicinity bayfront homeowner and multiple mooring permit holder. Asks for general fee reduction to $25/ft/year.
Mike Hill, permit holder supports CPI basis for fee adjustments; liked Karlin’s comparables analysis.
Ken Goen likes idea of tying rate to the 50 cent pier rate per square foot.
Richard Dorn points to issue of no discrimination in rates, tolls, charges, pier use to mooring use.
Chris Miller offers residential pier currently pays for area of tidelands covered by pier and floats, not where boat goes. By same logic, moorings would only pay for the square feet where the mooring tackle sits! Richard Dorn decries lack of equitable treatment.
Brad says, we’re hearing everything, getting sense of audience perspectives and will do best to arrive at fair result.
McIntosh reiterates commission duty to look at moorings, not moorings and docks [in response to people griping about how little docks are charged -ed.].
Carter remarking about need of HC and CC to listen to stakeholders, represent them, rather than acting on own preconceived notions. Carter gives credit to the
Stop the Dock Tax folks, by whose efforts mooring permit holders arrive at the table today with the opportunity to reengage fees and transferability. Without the pier permit holders, we would not be here. Carter reiterates that our goal should not be to attack the fair deal they got.
Joe Stapleton asks Newton to readjust CPI for just Orange County / Riverside as opposed to LA / OC / Riverside. Stapleton also brings up waiting list, that it doesn’t work (hasn’t worked), so why not dump it. Suggests that the concept of
affordable boating is a joke, it’s unimportant. Nevertheless access is important, even if purchasable…however process does needs to be transparent.
transferability in some form will probably happen. Avery also suggests waiting list should probably be dumped too. Carter says transferability is important and relevant, concept of investment and having
skin in the game so keeping boat in good shape is more likely. Avalon does not require an auction. Carter has list of Avalon mooring transfers, suggests private sector better positioned to operate the transfers. Carter suggests more government not always better.
Brad bracing for the City-run auction…why not the way to go? asking Carter. Carter turns it around and asks what is the harm of letting private sector handle it. Brad dislikes possibility that two people could do own deal out of public view.
Megan Delaney speaks on concept of discriminatory pricing regarding user fees, dock owners get to rent docks but mooring owners not allowed to rent mooring. Megan cautions it’s important to take a look at the issue of letting mooring holders rent mooring if pier permit holders allowed to do so.
Monty Snyder talks about his moorings. Says the waiting list is a dream but is inoperative. Boating is going to cost. No problem until the City got involved [e.g.
less government is better on mooring transfers -ed.].
Gentleman asks what is time frame? Brad remarks that several months is probable, will do as much listening and interchange as possible. Chris confirms several months.
Avery mentions we have several models for fees to choose from, current model, CPI model, comparables model, basket of marina slips percentage.
Gentleman talks about mooring size increase opportunities. Chris Miller says Harbor Patrol now advises Harbor Resources if mooring expansion is possible, case by case. Gentleman advocating building some mechanism into the new system to accommodate expansion.
George Hylkema speaks to absurdity of waiting list. In marketplace, buyers and sellers make or lose money on a regular basis. Concept of deposit, over time may go up or down. In MMPSC proposal we addressed issue of speculation by limiting transfers per person.
Scott Karlin ran his own CPI numbers using Orange County / Riverside only and numbers come to substantially the same as Patricia shows for the tri-county area. The historic dock fees basically DID track CPI numbers back to the 1970s. Karlin says CPI method very defensible.
Karl Drews in favor of transferability and lower fees, supports reasonable numbers being talked about. Mentions difficulty of using boat on mooring, operating costs that non–users don’t understand.
Girling listening, says he’s been studying. McIntosh likes turnout, says makes their job easier, can evaluate consensus easier, Stapleton asks if the room is okay, maybe get a microphone going.
Chris Miller suggests dates for next meeting, in Community Room in Civic Center, 6pm March 23rd.