HomeMy WebLinkAbout04 - Allowing Short-Term Mooring License Agreements and Establishing Fair Market Value License Fees for Offshore and Onshore Moorings - HandoutsWritten Comment Submitted by Newport Mooring Association City Council Agenda item 44
Allowing Short -Term Mooring License Agreements and Establishing Fair Market Value License
Fees for Offshore and Onshore Moorings
From: Admin <mail(a)MWorhnooring�association.org>
Date: November 14, 2023 at 2:33:28 PM PST
To: Dept - City Council <ci council&ewportbeachca.gov>
Cc: cilyclerk@newportbeachca.gov
Subject: OPPOSITION TO PROPOSED MORRING RATES FOR CITY "OWNED"
MOORINGS
OPPOSITION TO PROPOSED MORRING RATES FOR CITY "OWNED" MOORINGS
To the City Council,
The City of Newport Beach acts as trustees of the tidelands. The City does not own the tidelands but
rather administers the use of the tidelands. Over time the City as used portions of the tidelands which
have moorings. While the City owns the tackle, such as weights, chains and buoys connected to the area
of the tidelands, the City does not own the tidelands associated with the moorings. As used below, "City
Owned Moorings" refers to these moorings.
The Newport Mooring Association (NMA) has reviewed the proposed rates for what has been called
"City Owned" Moorings and has concluded that the proposed rates are inappropriate. We urge the City
to postpose action on these rates until such time as the Newport Mooring Association is able to obtain its
own appraisal and review the pending appraisal on all the other off -shore moorings. The NMA is aware
that the Harbor Commission intends to present an appraisal for the bases of new rates for approximately
600 or more offshore mooring rates within two months. At the Harbor Commission meeting two to
three months ago, the public was advised that the appraisal would be complete and presented within
approximately 60 days. The NMA would like the opportunity to review the permit offshore mooring
appraisal and then comment on or obtain for offshore mooring rates.
No Urgency. The City has "owned' or had the right to rent moorings under their control for over a
decade and has done so from time to time. A short delay will in no way prevent the City from
continuing to do so, especially in the winter months when the demand for use of moorings is low.
Initial Specific Concerns
Following a brief review to the appraisal submitted in support to the suggested rates, the following
concerns are noted:
Comparable Charged for Moorings
Tying rates to a marina slip rates is not a comparable rate. These are totally different types of uses.
Comparing rates to San Diego mooring rates is closer even if San Diego mooring rates need to be
increased with the cost of living. However, San Diego provides in -water dingy docks for dinghy with
outboard motors, so there is reasonable access at no cost. Any comparison the mooring rates in San
Diego would need to be reduced by the cost of renting a dock in Newport Beach for use of a motorized
dinghy in the water for access to the mooring. A mooring without reasonable access is like the sound of
one hand clapping. Our initial inquiry would show that the cost of having, for example, a 10-foot
dinghy on a dock in Newport Beach is on average $400 per month or more. Any comparison to rates in
San Diego would need to be adjusted downward by $400 per month for similar access.
There is also mention of moorings and slips in Central and Northen California, but no study of these
harbors, how they differ from Newport Beach, any subsites or under market rents for slips to, for
example, support local fishing fleets, etc. San Diego moorings appear to the closest similar moorings.
The rates for San Diego Moorings are misstated in the appraisal. As of November 14, 2023 (today) the
published rates for mooring (with access by way of 24/7 no limit dinghy docks) is on average
approximately $2.50 per foot. Here are the published rates:
Al - Shelter Island Roadstead $128.17 $64.00
A2 - America's Cup Harbor (rows B-J - under 30') $147.57 $74.00
A2 - America's Cup Harbor (rows L-V - 30'-65') $157.07 $79.00
A3 - Laurel Street Roadstead $138.02 $69.00
A3 - Laurel Street Mediterranean (under 35') $147.57 $74.00
A3 - Laurel Street Dual Point $147.57 $74.00
A4 - BaV Bridge Roadstead (Coronado) $128.17 $64.00
The average sized mooring is 50 feet. Using a rate of $150 per month, the rate is $2.50 per foot with full
access using the 40 to 50 foot moorings typical of Newport Beach. The appraisal incorrectly states that
San Diego rate $2.37 for moorings similar in size to Newport, and $4.92 for noncomparable moorings,
but then incorrectly averages the non -comparable mooring with the comparable moorings for a blended
rate of approximately $3.65 per foot per month.
Here's a view of moorings in San Diego showing three in water dinghy docks for use of the
moorings. You can see each mooring has easy water access at no additional charge.
Comparing the mooring rates to Yacht club rates, again does not take into account that the yacht clubs
provide access to the moorings which arguably is even better than access by way of an in -water dinghy
at a nearby public dock. This is because the mooring holder does not have to purchase a dinghy, motor
and maintain the dinghy, as well as not paying for dock space. Again, any reference to yacht club rates
would need to be reduced by the cost of acquiring, maintaining an access motorized dinghy in the water
and payment for in water dock space for the access dinghy.
Unfair Method and Beacon Bay Act Violation.
The appraisal does not take into account other rates charged by the City for all, or almost all other uses
of the tidelands, including restaurants with piers, rates charged to private marinas for the use of the
tidelands, rates charged to homeowners for use of the tidelands for private docks (piers). This appears
be both unfair and also a violation of the Beacon Bay Act, with forbids discrimination in rates charged
for the use of the tidelands.
Common Methodology Not Used.
The methodology of comparing rates for mooring vs slips is not the usual method for appraising
moorings. The State Lands Commission has used a totally different method, namely, first ascertaining
the fair charges that the State charges per square foot for use of the tidelands for recreational uses, then
ascertains the square footage used by a mooring, then applies the same square foot of tidelands use for
the square footage used by the moorings. That appears to be the same basic method used by the City of
Newport Beach when setting the published rates for the other sues of the tidelands.
The methodology used by the State Lands Commission can be seen in reports ignored by this appraisal.
Three reports we have reviewed include:
Southern California Benchmark Memo date May 6, 2022
San Francisco Bay Area Benchmark Memo date January 18, 2022
Tomales Bay Benchmark Memo date October 7, 2020
As shown in the California State Lands Commission Tomales Bay report ( at page 11):
"The Commission typically charges 5% to 6% of gross income for boat berthing for sites leased to
commercial marina operators, with most of the leases set at 5% of gross income." That is based on
typical rates charged marinas for the use of the tidelands (not rates the marinas charge persons they rent
slip to).
High Rates Means Access Denied. The suggested rates appear to be grossly exaggerated and run
counter to the City's stated desire to increase access to use moorings. We have observed for years there
are at any time, approximately 50 or more moorings that are vacant and ready to rent, but the City has
had a history of setting the rates so high that there is a major vacancy with the moorings that are not
being used. This suggests a pattern that the City does not what more moorings being used by the
public. In short, the higher the rate, the fewer mooring will be used by the public.
For the reasons set forth above, we urge the City to postpose action on the proposed rates until such time
as the Newport Mooring Association is able to consult with its own appraiser on both the appraisal for
the City Owned Moorings, as well as a review the pending appraisal on all the other off -shore moorings.
Respectfully Submitted,
NMA Subcommittee on Mooring Rates
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1. ONSHORE MOORINGS PAY 1.8.X (OR Mf ORE)/sy ft TI-IAN PRI%;.Nl F PIERS WIBIG BOATS
2, ONSHORE MOORINGS ARE NOT AI_,LOWED TO RENT/LEASE, BUT PRIVATE PIERS AN
RF:NT,;L,F 1SE THE FREE SPACES AROUND P1I::R.S FOR.14UNDREDS OR TI1OUSANDS/MNTH
y. ONSHORE MOORINGS ARE Si I3JEC'I"TfJ MANYi1 0I2.E FtEGUL.ATiONS TI[AN .('R1Vr1T'#'.
PIERS LJNDE R TITLE 17
BASIN MARINE RATES MARCH 2O22
€ 5)FI' BOAT<`SD58/Linear ft -.: $3,770/mnth
40ft BO-NI-538/Linear it = S1,520iflinth
22ft Boat,528/Linear ft = S61.6/ninth
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IS
Possible Violations By the City of Newport Beach of the Tide bands Trust Statues
(March 21, 2022)
1. "In the management, conduct, operation, and control of the lands or any
improvements, betterments, or structures thereon, the city or its successors shall make
no discrimination in rates, tolls, or charges for any use or service in connection
therewith." (Reference 1, p199) (See References Below)
2. CA Public Resources Code 6009.1 DUTIES OF THE CITY OF NEWPORT BEACH (See
Reference 2)
• Duty of full disclosure
® Duty to keep clear and adequate records
Duty to administer the [Tide Lands] trust solely in the interest of the beneficiaries
® Duty to act impartially in managing the trust property
3. PUBLIC TRUST REVENUES (See Reference 3)
• "Trustee is required to charge FAIR RENTAL RATES FOR COMMERCIAL OR PRIVATE
USE OF TRUST LANDS." (Distinction between Commercial and Private appears to
be acceptable) (The phrase "FAIR MARKET VALUE" is nowhere to be fond in the
CA Statues)
• "May not be used for any municipal purpose, or any purpose unconnected with
the trust. (municipal code enforcement, etc)
References:
1. State of California Statues of 1978, Chapter 74, Section 1, 3d, page 199
(httr)s://www.sic.ca.gov/)
2. Harbor Commission Agenda Package, March 9, 2022, p67, CA State Lands
Commission Slide Show Presentation, Slide #11
3. Harbor Commission Agenda Package, March 9, 2022, p67, CA State Lands
Commission Slide Show Presentation, Slide #5
' . M
An act relating to tide and submerged lands in the City of Newport
Beach, and in this connection repealing Chapter 494 of the Statutes
of 1919, Chapter 70 of the Statutes of 1927, Chapter 142 of the Statutes
of 1929, Chapter !'574 of the Statutes of 1929, Chapter 813 of the
Statutes of 1929, trod Chapter 200 of the Statutes of 1931, and
declaring the urge-acy thereof, to take effect immediately.
lAppriwed by Governor April f, 1978. Filed with
Secretary of Mate April 7, 1979.]
The people of the State of California dry enact as follows -
SECTION 1. There is hereby granted to the City of Newport
Beach and its successors all of the right, title, and interest of the State
of California held by the state by virtue of its sovereignty in and to
all that portion of the tidelands and submerged lands, whether filled
or unfilled, bordering upon and under the Pacific Ocean or Newport
Bay in the County cif Grange, which were within the corporate limits
of the City of Newport Beach, a municipal corporation, on July 25,
1919; the same to be forever held by the city and its successors in trust
for the uses and purposes and upon the following express conditions:
(a) That the lands shall be used by the city and its successors for
purposes in which there is a general statewide interest, as follows:
(1) For the establishment, improvement, and conduct of a public
harbor; and for t he construction, maintenance, and operation
thereon of wharves,, docks, piers, slips, quays, ways, and streets, and
other utilities, structures, and appliances necessary or convenient for
the promotion or -C.ccOrnmodation of commerce and navigation..
(2) For the establishment, improvement, and conduct of public
bathing beaches, public marinas, public aquatic playgrounds, and
similar recreational facilities open to the general public; and for the
construction, reconstruction, repair, maintenance, and operation of
all works, buildings, facilities, utilities, structures, and appliances
incidental, necessary, or convenient for the promotion and
accommodation of any such uses.
(3) For the preservation, maintenance, and enhancement of the
lands in their natural state and the reestablishment of the natural
state of the lands so that they may serve as ecological units for
scientific study, as open space, and as environments which provide
food and habitat for birds and marine life, and which favorably affect
the scenery and cl fmate of the area.
(b) Except as otherwise provided in this section, the city or its
successors shall not? at any time, grant, convey, give, or alienate the
lands, or any part thereof, to any individual, firm, or corporation for
11422 07850
Ch. 74 ) STATU'i'ES OF 1978 199
any purposes whatever; except, that the city or its successors may
grant franchises thereon for a period not exceeding 50 years for
wharves and other public uses and purposes and may lease the lands,
or any part thereof, for a period not exceeding 50 years for purposes
consistent with the trust upon which the lands are held by the state
and with the uses specified in this section.
(c) The lands shall be improved without expense to the state;
provided, however, that nothing contained in this act shall preclude
expenditures for the development of the lands for the purposes
authorized by this act, by the state, or any board, agency, or
commission thereof, or expenditures by the city of any funds
received for such purpose from the state or any board, agency, or
commission thereof.
(d) In the management, conduct, operation, and control of the
lands or any improvements, betterments, or structures thereon, the
city or its successors shall make no discrimination in rates, tolls, or
charges for any use or service in connection therewith.
(e) The state shall have the right to use without charge any
transportation, landing, or storage improvements, betterments, or
structures constructed upon the lands for any vessel or other
watercraft or railroad owned or operated by the state.
(f) There is hereby reserved to the people of the state the right
to fish in the waters on the lands with the right of convenient access
to the waters over the lands for such purpose, which rights shall be
subject, however, to such rules and regulations as are necessary for
the accomplishment of the purposes specified in subdivision (a) of
this section-
(g) Notwithstanding any provision of this section to the contrary,
the city may lease the lots located within Parcels A, B, and C
described in Section h of this act for the purposes set forth in this
section and for a period not to exceed 50 years. The consideration to
be received by the city for such leases shall be the fair market rental
value of such lots as finished subdivided lots with streets constructed
and all utilities installed. The form of such leases and the range of
consideration to be received by the city shall be approved by the
State Lands Commission prior to the issuance of any such lease. All
money received by the city from such existing and future leases of
such lots shall be deposited in the city tideland capital fund in
accordance with the provisions of this act.
(h) With the approval of the State Lands Commission, the city
may transfer portions of the lands granted by this act, or held
pursuant to this act, to the state acting by and through the State
Lands Commission, for lease to the Department of Fish and Game
for an ecological reserve or wildlife refuge, or both, and other
compatible uses to be undertaken by the department; provided,
however, that if at any time the Department of Fish and Came no
longer uses such portions of the lands so transferred by the city to the
state for such purposes, the lands so transferred shall revert to the
city to be held pursuant to the provisions of this act. Upon approving
i i 422 0 7870