State may be missing cut of dock rentals

June Casagrande

NEWPORT BEACH -- Residents renting out their private docks could be

racking up $4 million to $7 million a year while bypassing state

guidelines that say a fund to preserve California tidelands should get a

cut, according to a study compiled last year that was never followed up

on.

A report received by the city’s Harbor Committee in January 2001 used

private dock rental estimates as a comparison to consider revising

mooring rates. The report looked at 63 boats docked at 33 residential

piers and found that 62% of those boats were registered to people other

than the dock owners.

Using the informal sampling as a guide, the report speculated that if

62% of the boats in the harbor were paying an average of $5,000 a year to

private boat owners, that would mean $3.72 million a year was changing

hands. At the rate of $20 per foot for the average 40-foot yacht, the

cost would be $9,600 a year, bringing the total to more than $7 million a

year. Many docks have room for two or three boats.

At the March 12 City Council meeting, Councilman John Heffernan

suggested the city survey the practice.

“It seems to me that if the practice is widespread, some kind of fee

could help the city pay for dredging that otherwise will cost residents

about $5 million,” Heffernan said Wednesday. “People say it’s not

widespread. I say walk around the bayfront and look at rental notices on

the end of piers. It looks widespread to me.”

The matter was abandoned at Tuesday’s council meeting after Mayor Tod

Ridgeway dismissed Heffernan’s concern. Ridgeway had been a council

representative to the Harbor Committee in early 1991, about the time the

report was received.

The committee was not charged with investigating private pier rentals

but instead with reconsidering mooring rates, said John Corrough, former

committee chairman.

“A lot of this information was put aside and filed as not relevant to

the final question of how should moorings be dealt with and other

management issues,” Corrough said.

Private docks in the city are in areas designated as tidelands, which

means the state owns the land and the city acts as trustee. Cities that

use tidelands for commercial purposes are in many cases expected to set

aside a portion of the earnings for the Tidelands Fund. The

city-administered fund pays for preservation and improvements, such as

dredging. The 2001 report estimated that the city’s Tidelands Fund might

be losing out on about $372,000 a year because of the practice.

“When a grantee such as the city is allowing private use of property

like that, you would anticipate there would be some form of lease or

permit where revenues would go into a Tidelands Trust Fund,” said Curtis

Fossum of the State Lands Commission. “It could be for things like

dredging, those types of purposes.”

Fossum said his agency had not heard allegations that rentals of

private docks were widespread in Newport Beach.

“I think we’ll certainly inquire of the city,” he said, noting that

the city does have a lot of discretion in how it uses the state lands.

Also, it is unclear whether the practice violates city municipal

codes, which lay out specific guidelines and descriptions of commercial

versus residential piers.

“One could probably interpret it either way,” Assistant City Manager

Dave Kiff said.

“Renting out the docks allows more people to enjoy the harbor than

normally could, and that’s a good thing,” he said. “But if this is going

on to any great extent, we need to take a look at it, at the amount of

the rent being paid and whether fees should be applied.”

* June Casagrande covers Newport Beach. She may be reached at (949)

574-4232 or by e-mail at o7 [email protected] .