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City: Docks self-supporting

The slips also would turn a profit, Clearwater leaders say. A review is planned today.

By MIKE DONILA
Published January 17, 2007

CLEARWATER - If approved, the city's plan to build boat slips along the downtown waterfront would not only pay for itself but also turn a profit over its 40-year life span, city officials estimated.

How Clearwater would pay for and operate the docks and slips has been a contentious issue among skeptics who say the project would turn into a boondoggle for a city that should save money, not spend it.

The slips would be in an area of downtown where the city charter requires that voters okay any such development. An election is set for March 13.

City officials are holding a public meeting to discuss project details at 6 p.m. today at the Harborview Center.

Going into that meeting, officials said they've put together a long-term operation plan based on what they say are conservative estimates and a market and feasibility study drafted by Applied Technology & Management, an environmental, marine and water resources engineering firm in Gainesville.

City officials maintained that plans to build 129 boat slips, a promenade, a boardwalk and a fishing pier near Coachman Park would help lure more residents and visitors who would help revitalize downtown.

And the rental fees received from the boat slips, which would be built on the north and south sides of the Clearwater Memorial Causeway, would be expected to pay for most of the construction and the upkeep costs, they said.

The slips would operate as a self-sustaining enterprise fund much like the city's solid waste collection system. That means the operation also would have to kick 5.5 percent of its revenues into the city's general fund each year.

Here's a look at some of the financial projections:

- The city initially would let boaters rent 117 slips annually at $15.50 per foot per month. For a 40-foot boat, that would equal $620 per month in rent. And that price would rise by 25 cents a foot each year. By comparison, the statewide average rent is $20.84 per foot per month for public and private boat slips, the city's consultants said. On average, slips in southwest Florida go for $19.10 per foot per month.

- Twelve "transient" slips would cost boaters $2 per foot per day. That price would go up 5 cents per foot each year.

- Officials assume that the daily rentals would be far more lucrative than the monthly rentals. For example, during the first year of operation, the city assumes that the 12 transient slips would generate about $522,000, while the 117 monthly slips would generate a total of $882,000 in rent.

- Other revenues include increased fuel, ice and drink purchases from the nearby marina.

During the first year of operation, the city expects a net profit of $8,512. Net profits are expected to be $20,000 in year 10, $129,000 in year 20 and $90,000 in year 40.

By year 40, the city would expect to bank $4.7-million in net profits that could be reinvested into the operation. And Clearwater's general fund, which pays for citywide services such as fire and police protection, would receive $4.8-million.

Construction would cost an estimated $11-million and would be paid for by 20-year bonds. The city estimates that the loan's interest rates would fluctuate between 5 and 6 percent, so paying off the debt would cost the city $18.8-million.

The city also would plan to use $500,000 each from the Downtown Development Board and the Community Redevelopment Agency for operations. This property tax money is generated from within the city's redevelopment district, which includes the area where the boat slips are proposed, and is earmarked for downtown improvements.

Money from rental fees also would be placed in a reserve account to cover repair and maintenance costs. About $12.6-million would be placed into this fund by year 40, but officials would expect not to use all of that money.

Other expected expenditures include salaries for five new employees and utility fees.

Assistant City Manager Rod Irwin, who is overseeing the project, and finance director Margie Simmons said they are confident in the numbers and think most of the slips will be rented out for a bargain to the boaters.

Moreover, the two said they used conservative estimates to make sure the project would operate in the black. For example, they factored in higher interest rates, higher personnel costs and rental fees below the state's average to come up with their financial plan. And they didn't include a $1.2-million grant that the city is expected to receive for the project.

Further, the city has $22-million in an insurance reserve fund to protect city facilities from damage. The slips would be built to withstand Category 2 hurricanes.

"We operate our own marina, so we know what it costs to run a marina," Simmons said. "We've pushed this thing every which way ... and I feel very confident in the (numbers)."

Despite city assurances that the project would make money, Anne Garris, chairwoman of Save the Bayfront, said she's not buying it.

"I think it would be great if they could put a dock where people could go there and tie up," said Garris, whose group successfully defeated a similar boat slip plan in 2004.

But, she added, "I cannot see where it's right to put boat slips that are going to be used for private individuals just to store their boats in what should be a place for the use of the public - all the public."

If voters approve the project, construction is expected to start in early 2008 and wrap up a year later.

Fast Facts:

Review the plan

Clearwater leaders will hold a meeting on the proposed downtown boat slips from 6 to 8 tonight at the Harborview Center, on the western end of Cleveland Street. For a preview, go to www.myclearwater.com and click on "Latest Information." For more information, call (727) 562-4881.

[Last modified January 16, 2007, 23:22:35]