CLEARWATER - During their July 20 meeting, the Clearwater City Council approved a plan for boat slips on the city's downtown waterfront and authorized a referendum for November 2006 that will seek voter approval of the project.
The 129-slip facility would be built off Coachman Park, with slips to both the north and south of the Memorial Causeway Bridge. Floating concrete docks would be installed with "wave attenuation devices" extending below the surface to minimize the chop generated by northwest and southwest winds.
David Gildersleeve, representing the city's consulting firm Wade Trim, said at the July 18 Council work session that the water depth in the area of the slips ranges from five to sixteen feet, and that the facility was designed to withstand a Category II hurricane. Slip sizes would range from 30 feet to 55 feet, with the majority between 40 and 50 feet.
Gildersleeve estimated the cost of the boat slip project at nearly $11-million, including $8.4-million for the boat slips. Upland improvements, consisting of restrooms with showers, a small dockmaster's office, parking, landscaping and irrigation would cost an additional $953-thousand. The cost estimate also includes a $1.4-million contingency fund.
Assuming voter approval in November, Gildersleeve explained that finalizing the design, obtaining the required permits and constructing the facility would take from December 2006 through December 2008; "The marina would be up and running in '09," he said.
Kirby Marshall of Applied Technology Management presented the Council with a market study and financial analysis of the project during the July 18 work session. Recognizing the dwindling supply of public boat slips and the strong demand for them, Marshall said of the proposed downtown boat slips, "It's really a no-brainer." Marshall recommended a transient slip rate of $1.85 per foot per day, and a monthly rate of $12.50 to $15 per foot.
"Can the facility make money?" Marshall asked rhetorically. His answer was promising, but fell short of profitability. Marshall forecast annual net operating income of $655-thousand, but that would be overcome by debt service, resulting in an average annual deficit of $316-thousand.
Mayor Frank Hibbard's response was both enthusiastic and cautious; "I'm excited about the whole project. I wish it would cash flow from the get-go, but with what we see with construction costs, that may not be realistic," he said. Councilmember John Doran was also concerned with finances. "The voters will approve this, not us," he said, "The boat slips have to be self funding. If not, we're going to have a difficult time getting to 51 percent."
City staff heard the Council's financial concern loud and clear, and came back on Thursday night armed with a solution.
Assistant City Manager Rod Irwin said that the city would aggressively pursue state and federal grants and seek help from the county. $3.5-million would be required to buy-down the bonding to a point of break-even cash flow.
Irwin also had a contingency plan in case grant monies were not forthcoming. First, the slip rate would be raised to $14/foot/month from the $12.50 suggested during the Tuesday work session, eliminating $90-thousand per year of the deficit.
Irwin also recommended that the Downtown CRA could provide $500-thousand of capital from its tax increment, buying-down the bond financing and saving the city $46-thousand annually. Financing of the "public" improvements, totaling $1.1-million, could come from other sources, Irwin said, eliminating another $102-thousand of annual deficit.
Irwin also suggested raising slip rates 25-cents per foot every year, rather than every other year as originally planned. He said that would further reduce the average deficit by $79-thousand per year.
The net result of Irwin's contingency plan was a $1,800 average annual operating surplus versus the $316-thousand average annual loss. The Council bought it and approved the project unanimously. Hibbard later said, "I am committed to making certain that the boat slips cash flow from year one until the retirement of the bonds."
The city's next step is to prepare the ballot language for the November referendum. The referendum question must be supplied to the Supervisor of elections by August 18 according to Clearwater's Assistant Director of Public Communications Joelle Castelli, leaving the City Council with two work sessions and two meetings to discuss and approve it.