SUPPORTS ITEM NO. 1 CS&B COMMITTEE AGENDA FEBRUARY 22, 1996 ADMINISTRATIVE REPORT Date: January 29, 1996 TO: Standing Committee on City Services and Budgets FROM: Director of Finance SUBJECT: Heather Civic Marina 1996 Moorage Rates RECOMMENDATION A. THAT the 1996 moorage fees at the Heather Civic Marina be increased by 2.0% effective April 1, 1996. B. THAT fees for transient moorage, electricity, and use of the marine elevator at the Heather Civic Marina be increased by 3.0% effective April 1, 1996. C. THAT the proposed rate changes be posted at the Heather Civic Marina. MANAGER'S COMMENTS The General Manager of Corporate Services RECOMMENDS approval of A, B and C. COUNCIL POLICY Fees at the Heather Civic Marina are adjusted annually to reflect cost increases and current market conditions. PURPOSE The purpose of this report is to seek Council approval of moorage rates and other fees and charges at the Heather Civic Marina for 1996. BACKGROUND The City of Vancouver owns two marinas, both situated in False Creek. Both are managed by the Park Board. The Heather Civic Marina has 251 mooring berths and the Burrard Civic Marina has 481 mooring berths. Together, they account for 50% of the moorage available in False Creek. The Heather Civic Marina is an asset of the Property Endowment Fund (PEF). Fees charged at the Heather Civic Marina are used to cover operating expenses with net income accruing to the PEF, providing a return on its investment. Moorage and other fees are set annually by Council. MOORAGE FEES Moorage fees at the Heather Civic Marina account for 90% of the marina's revenue. These fees are established at levels reflective of marina operating costs and the market for moorage in False Creek and the lower mainland generally. Based on a review of the budget expenditures and a review of the market, the Director of Finance recommends that the moorage rates at the Heather Civic Marina be increased by 2.0% for 1996. This increase will bring rates to $6.81/ft./month (exclusive of GST) for recreational boaters, and $7.15/ft./ month (exclusive of GST) for boaters who live aboard. Live- aboard rates are 5% above general moorage fees because they are paid on a monthly rather than on an annual basis. The recommended increase is based on the following factors. - Operating costs are expected to increase by approximately 2% in 1996. - It has been City policy that the Heather Civic Marina moorage rates not lead the market. As a result, moorage fees have generally been kept lower than the rates at the private marinas in False Creek. A 2% increase maintains this relationship. Appendix I provides a comparison of rates. - The Park Board approved a two-tier increase in moorage fees at Burrard Marina. The general increase is 2% reflecting anticipated cost increases. In addition, the Park Board has decided to impose an additional 2% increase in moorage fees to cover the cost of processing payments made by credit card. This additional amount will be discounted to those who pay in full by cash or cheque. The Director of Finance is recommending that this arrangement not be extended to the Heather Civic Marina. - Moorage market conditions have been positive, with low vacancy rates and waiting lists for larger boats at the False Creek marinas. The Director of Finance does not recommend that the use of credit cards be extended to the payment of moorage at the Heather Civic Marina. For board owners, moorage represents a significant annual expense which is payable in advance, in a single installment, and is predictable from year to year. This payment is not like a normal c o n s u m e r p u r c h a s e , w h e r e t h e C i t y might otherwise offer alternative payment options. Utilizing credit cards for these payments would impose a credit card fee of up to 2% on the marina which must then be passed through to the boat owner. For a 30-foot berth, this additional charge would be about $53. Under the proposed fee schedule, Heather's moorage fees will be $0.30/ft./month greater than Burrard's. A historical comparison of rates charged at the Burrard and Heather Civic Marinas is included in Appendix II. Moorage rates at both marinas will remain below those at other False Creek marinas and are consistent relative to other lower mainland marinas. OTHER FEES The Director of Finance recommends adjustments to other fees and charges at the Heather Civic Marina as follows: - Live-Aboard Fee - The Heather Civic Marina has 26 live- aboard berths which pay a surcharge of $26.50 per month (exclusive of GST). This charge covers the costs of maintaining additional facilities for live-aboards (telephone and electrical lines, sewage system, laundry room, showers). (The 1996 operating budget request includes $11,100 for facilities upgrades at the marina.) It is not recommended that this fee be increased in 1996. - Transient Moorage - Temporary moorage is offered by the day or by the month when berths are available. Premium fees are charged for this moorage, reflecting its short term duration. It is recommended that these fees be increased by 3%. - Use of Electricity - Live-aboard and recreational boaters pay for electricity use at the marina. It is recommended these fees be increased by 3%. - Parking - Live-aboard boaters are charged $35.00 per month for vehicle parking. It is not recommended that fees for parking be increased in 1996. - Elevator Fees - A marine elevator is available to lift boats out of the water to perform maintenance. Boaters can either rent the hoist by the hour (a short lift) or by the half day (a hoist). It is proposed to increase these fees by 3%. Recommended changes in these fees are summarized in Table 1. Table 1 - Summary of 1996 Marina Fees 1995 Fee Proposed 1996 Proposed 1996 (excluding (excluding (including Service GST) GST) GST) Moorage Fees: General $6.68/ft./mth $6.81/ft./mth $7.29/ft./mth Live-aboard $7.01/ft./mth $7.51/ft./mth $7.65/ft./mth Transient Moorage Per Day $0.81/ft./day $0.84/ft./day $0.90/ft./day Per Month $8.68/ft./mth $8.94/ft./mth $9.57/ft./mth Use of Electricity: Live-aboards $0.055/kw $0.057/kw $0.061/kw Recreational Boaters $13.08/mth $13.47/mth $14.40/mth Elevator Fees: Short Lift Members $30.66/use $31.78/use $34.00/use Non-Members $35.77/use $36.45/use $39.00/use Hoist Members $61.32/use $63.55/use $68.00/use Non-Members $71.54/use $73.83/use $79.00/use * * * * *