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City Would Assume Risk on Marina Property

Documents released Wednesday show details of the plan for a marina at Second Street and Bay Avenue.

In a so-called "revenue-neutral" agreement, the City of Ocean City would pay a private marina operator $135,000 a year to rent its own public property.

That arrangement is outlined in two public documents released on Wednesday (see attached PDFs).

City Council is scheduled to vote to approve the two agreements at a 7 p.m. Thursday (June 28) at .

Council's Thursday vote will determine the fate of a proposal to enter a public-private partnership to develop a marina and public recreation facility on publicly owned open space at Second Street and Bay Avenue in Ocean City.

In presentations to the and , the city administration described an opportunity to attract a private developer to invest in improving the bayfront property at no cost to the city.

Ocean City Marina, LLC — the sole bidder on the project — would pay for improvements to the property (including a public restroom facility and public pier for fishing, launching kayaks and disabled access) in exchange for rights to operate a private marina there.

The proposed agreements provide more detail on the "revenue-neutral" arrangement. The city would pay Ocean City Marina $135,000 annually. The marina would first pay its operating costs then return the next $135,000 in revenue each year to the city.

In essence, the city would be assuming the business risk of operating a 27-slip marina with annual slip fees of $4,200 to $6,300 per year. Because each slip would be equipped with a mechanical lift, the annual fees would be 300 to 400 percent greater than the existing fees.

The marina would have to rent all 27 slips at $5,000 apiece to reach $135,000 in annual revenue.

Only a small handful of boats rent slips from the city at the existing marina, where tidal currents and exposure to the open water of Great Egg Harbor Bay make docking a boat there a challenge. In presenting the proposal, Sean Scarborough of Ocean City Marina said the state-of-the-art lifts would solve that problem.

The proposed agreement would be for 10 years with options to renew for up to three five-year periods. As part of the agreement, the marina would pay the city $102,530 to enter the agreement once all improvements are completed.

The agreement requires that Ocean City Marina have all county and state approvals before it can be executed.

Cape May County owns the property as part of its open space program and is subject to state Green Acres requirements that land remain designated for public use. Ocean City leases the space from Cape May County for $1 annually.

Ellen July 02, 2012 at 02:14 PM
sour.
Eric Sauder July 02, 2012 at 06:13 PM
LMFAQ I'd be interested in knowng the particulars, if I can't be sued for asking.
feasterville resident July 02, 2012 at 07:57 PM
Eric and LMFAO, i too am interested. I dont see how this project is monetarily viable. Spruce-up the area for public recreation, maybe a park setting? The currents are wicked in the area for docking boats. There are several properties for sale on the bay near this location. Is someone going to buy them and build residential, ergo, a so called marina would be attractive to the builders. There seems to be an obscure agenda.
Eric Sauder July 02, 2012 at 09:31 PM
In regard to what I stated at the Council meeting ... that I found it curious that Mr. Scarborough formed an LLC (Ocean City Marina) a month prior to the first RFP being issued, the City Solicitor stated that notice was given at a prior council meeting of the intent to float an RFP for the marina. I reviewed the DVD of the meeting of 10/13/2011, which predated the LLC by 4 days, and sure enough councilman Allegretto, at that meeting, made a statement to that effect. I was searching for an explanation as to how this could have happened and I now have one. I still take issue with how the City conducted itself throughout the process, the terms of the deal, the lack of public disclosure as to the terms of the deal, and the rapidity with which it was pushed through. The first ADVERTISED public meeting was held on Monday night before the vote on Thursday, which didn't give the press time to report on it (in print) before the vote was taken. I also found, on a revised agenda for the Planning Board, that it mentioned a "presentation" on the Marina District. A vote was taken at that meeting in which the members of the board "approved" the project. I was not at the council meeting where a similar "presentation" was made, and found no mention of it on council's agenda. I attended the council meeting of 10/13/2011. It was over 3 hours long and there were other items on the agenda (specifically the rezoning of 13th and Haven) that had my attention.
Eric Sauder July 03, 2012 at 01:46 AM
Featerville is close to York, right? You're a white rose then. I'm a red. Nice talking with ya neighbor. Word is a high rise condo was originally envisioned for that site but the zoning was changed. At any rate that specific lot is now in Green Acres, so building would be prohibited. In case you're late to this there's a considerable amount of background you might not be aware of. I agree that this project does not appear to be monetarily viable (for the City at least). As for whether the marina will make those other lots more valuable, you could be right. Thanks for getting involved (I assume you're a second home owner here.)

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