Sunday, November 16, 2008

It's a breezy, overcast Thursday afternoon and things are quiet at the newly renovated Plantation Yacht Harbor Marina. A diver gears up to inspect the hull of one vessel on the marina's long dock. An occasional patron walks along the shoreline. But mostly, there are empty slips.

Meanwhile, Dockmaster Tim Morrissey sits in his makeshift office watching CNBC.

"We're watching the oil prices and the debauchery on Wall Street," he said. "Discretionary spending is the first thing to go."

It has only been a few weeks since the village of Islamorada-owned marina, on the edge of Founders Park, reopened after undergoing a yearlong, $5 million renovation. But already there is worry that with the economic crisis taking a toll on the South Florida boating industry, Plantation Yacht Harbor won't be able to make expenses.

Earlier this month, just 21 of the municipal marina's 82 slips were occupied. And while that number is likely to grow as the winter season approaches, village Parks Director John Sutter -- who in the summer said he hoped to have 90 percent of the marina full by the New Year -- acknowledges that finding customers likely will be a problem.

"I think the realistic analysis of the coming year's economy," he said, "would say that not only our marina, but a lot of businesses all over won't meet income projections."

Key West

At the city-owned Key West Bight marina, which has 144 slips with plans to add 38 more, revenue has been increasing steadily, by about $1 million or $2 million, each year since 2004, said Marina Manager Mark Tait. Revenue was $11.8 million this year, up from $6.5 million in 2004.

But officials this fall began seeing a loss in some revenue.

"Surprisingly, a month-to-month comparison shows that we're still doing all right, up until September, which is when we saw a decline in transient slip income," Tait said.

Much of the marina's income comes from tenant leases, such as historic schooners, snorkel boats and charter fishermen. Those businesses have been struggling mightily in these economic times, Tait said, more so than the city-owned marinas.

Profits could be slowing even further as tourists cut vacations out of their dwindling budgets, and fuel costs -- even as they go down -- still hamper boating adventures.

For the first time in recent memory, the 33 transient boat slips at the downtown marina were not filled for the Fantasy Fest celebration that drew an estimated 60,000 or 70,000 people.

"There's usually a waiting list for those slips," Tait said, adding that reservations were down significantly for the powerboat races.

The New Year's celebration will be the next barometer for the marina, which usually is filled and has a waiting list for the holiday.

The other city-owned marina, at Garrison Bight, which houses charter fishing boats, live-aboard vessels and other pleasure boats, enjoys a more steady income and local, long-term population, Tait said.

But fishermen on Charter Boat Row are struggling with their lease payments to the city.

"Some of those guys only did two trips in September," Tait said.

Garrison Bight also includes about 149 moorings for live-aboard vessels anchored offshore.

"That income usually remains pretty steady," he said, adding that the revenue comes from long-term leases.

In other upcoming activity, the city also has requested bids from developers interested in building a new marina at the city-owned Truman Waterfront.

Marathon

The City Council recently voted to take preliminary steps to expand its dockage.

The Marathon City Marina boasts one of the largest mooring fields on the East Coast, with 226 mooring balls. Landside, however, the city only has space to accommodate nine to 12 boats on its seawall, depending on their size.

The council recently agreed to proceed with the estimated $30,000 permitting process to add 20 dock slips. Although the city does not have the funds to start such work, the permitting process is expected to take several years.

"Marathon's unique feature will play a large part in our future," said City Councilman Don Vasil, who has been a proponent for expanding services at the city's marina.

In the past two years, Marathon's marina has blossomed into a profitable venture for the city. The facility is not expected to draw on any general tax funds this year, and marina employees say about $20,000 will be kicked back to City Hall at the end of the fiscal year. The marina's budget is about $650,000, most of which is paid for by user fees.

As for demand, the marina sees its capacity swing between the tourist season and the slow summer days.

"We are about 60 percent full right now," Ports Director C.J. Geotis said of the mooring field. Filling the dock space has not been a major financial problem for the city in the past due to its small size.

Marathon Harbormaster Richard Tanner said he was not sure how the numbers would play out in the coming months for the mooring field. "We don't know what is going to happen with this season until it gets here."

In the past few years, the mooring field has been about 95 percent full during tourist season. The mooring field also has served as affordable housing for Marathon's work force, because rent to moor a sailboat on a ball costs about $265 a month.

Due to a large population of yearlong residents living in the harbor, the city is in the midst of building a new bathhouse on the marina grounds. The project, which is about 30 days away from being finished, is expected to cost about $580,000, which is being paid from Marathon's capital infrastructure funds.

There are eight employees working at the city marina. The marina does not offer any fuel or fishing services, but dock slips have access to electricity and the city operates a pump-out boat to deal with waste on live-aboard vessels. In addition to the bathhouse, the marina also has laundry facilities.

Islamorada

Declining marina revenues would mean a hardship for the village and by extension the Islamorada taxpayers.

Unlike other village holdings, the Plantation Yacht Harbor Marina is run under a standard business model. It is funded only by its own revenues, not by taxes or other fees. To meet expenses in the coming year, it has to make enough money to cover payroll, of course. But the climb is much steeper than that. It must also make enough to cover $390,000 in debt service, a result of the renovation.

Any shortfall likely would come out of village fund reserves, Village Manager Ken Fields said.

To pay for the upgrades, the village increased slip rental prices at Plantation Yacht Harbor earlier this year by more than 50 percent. That move sent more than half of the marina's 20-strong live-aboard community packing, temporarily exasperating revenue shortfalls. At present, seven live-aboard vessels occupy the marina, Dockmaster Morrissey said.

Another bad sign: Morrissey has spent the past couple of weeks contacting people on the 100-plus-person marina waiting list that Parks Director Sutter and other village officials have talked about for years. Morrissey recently tried to contact 50 people, he said. Five had called back.

"Four of them said, 'Put me on the bottom of the list,' " he said. "One said 'no.' "

Despite these troubling signs, there was a small measure of good news. Morrissey was able to secure three reservations for Jan. 1. And there has been little complaint about the prices, which range from $21 to $25 per foot, per month.

"The best thing is that when people come here, they absolutely love it," Morrissey said.

The recent drop in fuel costs also could play into the hands of local marinas, Fields said.

Still, in an attempt to lure customers, Morrissey and Fields said they plan to increase the marina's marketing budget. In addition, Morrissey is working on upgrading the marina's Web site. He also plans on aggressively reaching out to fishing captains.

If more marketing doesn't do the trick, Fields said, they'll have to cut staff. And if that doesn't work, it will be village reserves that take the hit.

"We were hit by an economic tsunami," Sutter said. "We're shaking the bushes everywhere we can."

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