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08/01/1996 (2) " I .' .' : pi, " I ',' .. : ~ : ' .':.., .... . . ' ,'~ ..,. ., ...'. :.... . '. ' ..' I. .".': < .'. ." ' .'. ~ } , . \' .', ,.' .' , ' . : c (.. II . .' .,', . .' ',~ ..c, . "I " . l.,., '., '.' ',. . . . . ., , ' .. . . , " . . t:'...,.' ': . .,... 'C''. \'. ....'. .., .;. , '. . . ,. .... I' . . '. c, ~ ';:' ~, ' .: ',.' '.: I; . . ' "__ "...' :.:~..t~'.;:I:.r,,~"':~. .' ,~,~ 1.:'(1~1:.~~1~; ......:lj~~~~H'~ ,... ..' .........~..l...'~....t,~.+...f..~~,.[,...t.~tlJ:".~'~ " . <:l' ' .FRC . Fiscal Review Committee Minutes . \ " . Date H1l3U stl j l~qCp :j ,) ;~'lo' () ,'. . \ ' . . '. ,I .> 't . .. . .'....,--.....joII~ ~.~.. _.....f.ij:....~#.t". 'n'~....~~~..;.tJ....,.}':+!.... ,~ ,...,.. "'~.. .,' ',...i'.t,'....,'...::.;.:c,.~l.. ~""_' ,', ,., '.: .'. ',' ",:: .' '":- '.' ,:'., ,..'. ,'."", ',' ,:'.,'. " '.. : "". '. "1: .,',", .\' I ~ " . . . '. '", ~~,' I,..~' . '. , . I'" ,\.' .."" '.' ." . ' '. I ,,1, ~_ . ". [I' , " ' . ~. ", " Absent: Janet MacNutt Board Member r , '. " , ~ FISCAL REVIEW COMMITTEE CITY OF CLEARWATER August 1, 1 996 Present: John Rich Daniel Fleck Carol Warren Daniel Moran Tina Wilson William Held Brenda Moses Board Member Board Member Board Member Board Member Budget Director Harbormaster Board Reporter Budget Director, Tina Wilson called the meeting to order at 8:05 a.m. at the Municipal Services Building, Clearwater, Florida. Harbormaster Held distributed and reviewed business plans for the marina and Pier 60, which are both enterprise funds. Business plans will be reviewed and updated annually. It was noted advertising in majoi magazines and brochures promotes all three facilities. ("~\ m1I Marina Mr. Held referenced page 14 of the business plan entitled "Second Draft Clearwater Municipal Marina Business Plan" dated July, 1996. Objectives included: 1) maintaining the municipal marina as a revenue producing activity of the Marine Department and ensuring the City receives fair market value for its investment, and ensuring the marina is competitive with other marinas and businesses in the area; 2) increasing marina revenue each year from $1,954,495 the first year of the business plan to $2,080,480 the last year of the plan, and maintaining expenditures at less than 100% of revenues; 3) continuing an extensive campaign to market and promote the municipal marina to citizens and tourists by taking full advantage of the facility; 4) continuing annual customer and safety training for marina employees; 5) continuing to upgrade the marina to make it a "show piece" on Clearwater. Beach; and 6) continuing to maintain and upgrade the launch ramp. Details and strategies to accomplish each objective were discussed. The parking problem at the marina was discussed. Lessees and their employees currently park in front of the building. Plans are to build a crosswalk to link the marina to the civic center, requiring lessees and their employees to park only at the civic center. Tenants purchase half day, all day, monthly or yearly parking permits on a first-come, first- served basis. They can park in any open metered space at the marina, except in front of the building. Permit prices are $1 for a half day, $2 for a full day, $10 monthly, and $100 yearly. The money goes into the parking fund, not the marina. Opening parking areas on Memorial Causeway to the east of the marina is also under consideration. o Mr. Held personally controls marina fuel sates on a daily basis. Commercial, non- commercial diesel fuel and 89 octane gasoline is available at the marina. Tankers are not mFRC08.96 1 8/1/96 Renovations to the marina building have been done, including installation of new sidewalks and decorator lamp posts, and the opening of a free fishing pier on the east side of the marina. Other improvements planned include: 1) installation of an A TM machine and a City kiosk in the lobby: 2) installation of a TV monitor showcasing the weather channel; 3) building a crosswalk linking the marina to the civic center for employee parking; 4) replacing power outlet utility stations; 5) purchasing a portable sewage station for Island Estates Marina; 6) installing additional decorative lamp posts; 7) upgrading, resurfacing and re-striping the Seminole launch ramp and parking lot; 8) repairing concrete landings for floating docks; 9) and replacing all computer software and hardware. It was noted Mr. Held plans to change the Staff Assistant II position to a customer service representative position, because the position involves billing, contacting customers, and monitoring slip maintenance, rather than typical secretarial functions. I~ , permitted to refuel at the marina. Fuel discounts are given for volume sales. Surveys are done of all marinas on the west coast to monitor fuel prices in order to keep them as low as possible. Leases at the marina are net leases, which means all lessees pay for taxes, insurance, maintenance, and utilities, Lessees must provide proof of liability insurance coverage, with the City of Clearwater being an additional insured. Taxes are billed to the marina, which in turn bills lessees, {~ Marine Services owns equipment, which Includes a barge and a tug. The equipment is used to replace marina pilings, rebuild docks and service the facility internally, which greatly reduces costs. The marina can contain up to a 300 gallon oil spill, The marina has an agreement with Clearwater Bay Marine Ways, Inc, to sell permits. They retain 15% of daily launch permits and turn 75 % in to the marina. Should a monthly or yearly permit be requested, the marina receives 100% of those revenues. An average of $40,000 per year is received from 17,000 boaters using the facility. Projected marina operations referenced on page 49 of the "Second Draft, Clearwater Municipal Marina Business Plan", dated July 1996, were reviewed. Based on previous revenues and expenditures, projections were between 99.0% and 97.4%. Mr. Held noted each year the marina is in the black because it is an enterprise fund. Unspent money goes into unappropriated retained earnings of the marina and is used to improve the facility. Gross profits are consistent with municipal marinas. It was noted municipal marinas provide a service to the community and revenues are much less than those of private marinas. It was also noted the City's goal with an enterprise operation is to provide a good service to citizens and maintain the facilities, but not necessarily make a large profit. The marina pays to the general fund, for administrative service charges for operations and covers all costs, as well as provides services to users at a reasonable cost. The Police Department guards the marina from 9:00 p.m. to 6:00 a,m., which is preferred over hiring outside contractors who pay their personnel minimum wage to guard million dollar vessels. ,::J It was noted the marina has not had an increase in slip rents since November 1, 1993. Measure Masters did a laser study inside the marina building to determine square footage dimensions for rental purposes. Irvin Economics, Inc. also did a study of rental rates, marinas and slip rents, which prompted slip rental increases, and discounts for advanced payments, effective October 1, 1 996. Rental survey sheets and information are included in the back of the business plan booklet. Should a situation arise involving major expenditures at the marina due to a catastrophe, adjusting rates may be necessary. Mr. Held will request City Manager approval limits be increased to 10%. In 1993, the marina mFRC08.96 2 8/1/96 I~ ,1":"';'\ ~"p '.~1,j o changed to a process unique to marinas, which incorporated rent increases dependent upon the number of passengers a vessel can carry. The largest vessel in the marina is the Starlight Majesty which is 100 feet long and can transport 300 passengers. Their current monthly rental charges are $720, which will increase to $1000, and $321 monthly for office space. Although no increases have been implemented for three years, and this increase appears steep, most tenants realize how fortunate they have been and will accept the increases with no problem. Commercial rates were analyzed, and adjustments have been made, bringing rates in line with other municipal marinas. Parasail boats can make several trips, bringing in large revenues, and the City feels a proportionate share of the profits is in order. It was suggested implementing increases gradually, rather than in one application to avoid businesses leaving the marina. Another change will be the establishment of a $4 per square foot rental charge to commercial tenants for offices and enclosed storage spaces. Ticket booths will not incur the $4 per square foot charge, but it was suggested the marina consider charges in future business plans, Two years ago the tax assessor determined tenants were required to pay taxes. The marina went to court on the issue and lost. Marina rental rates are shown on page 16 of the business plan. Increases were based on survey results. Past years' leases were for five years at a fixed rate, which limited potential revenues, and plans are to add CPI increases on January 1 st of each year. In the event of a hurricane or other catastrophe, the marina has additional liability insurance coverage for damage, fire or explosion. The hurricane plan does not require boaters to leave the marina, but does include drawings on securing boats. This year a video camera was purchased in order to take videos of tenants who are unable to secure boats for various reasons before a catastrophe. Employees will walk docks, taking pictures to use as "before" pictures for insurance purposes. Mr. Held stated with increased insurance and FEMA coverage, the marina should be sufficiently covered for a major catastrophe. An extensive marketing campaign will be launched to promote the municipal marina to citizens and tourists. Marketing pieces will include pamphlets on safe boating, tide charts, brochures on the pump out system, the Clearwater Municipal Marina, ads in the Waterway Guide and Waterfront Facilities Magazine, and the Coastal Cruising Magazine published in North Carolina, and information on the Seminole launch ramp. Mr. Held said the marina has received four awards from the Tampa Bay Regional Planning Council and one from the Governor's office for an environmental award, one of which was for the new sewage pump out station. The new vacuum sewage pump out station allows boaters to remove sewage free of charge, regardless of membership status, This process promotes environmental ecology and keeps sewage from flowing into Clearwater Harbor. Thus far, 3,000 gallons of sewage from transient boaters has been removed. It was noted some dock kiosks were blown away with the last big wind storm, and they have no continuity. Mr. Held indicated the kiosk that blew away was very old, and new ones have been properly anchored. A question arose about standardizing styles of buildings. Mr. Held indicated the businesses in question were most probably six-pack fishing charter boats. Each vendor has a unique theme to promote their business, and marina staff reviews them prior to incorporation. There are three requirements for kiosks: 1) detailed construction plans with exact dimensions must be reviewed by marina staff mFRC08.96 3 8/1/96 ....\{ i~ (JJ'" .....,r" o prior to construction; 2) if plans are acceptable, a building permit is required; and 3) the building must comply with City sign ordinances. The South Beach Pavilion has a lease with the marina to govern beach vendors from First Street to the jetty. Others, such as the Doubletree Surfside, Clearwater Beach Hotel and Rockaway Grill have waiver agreements with the City specifying what vessels are permitted to operate in the area. Specific amounts of water craft, aqua cycles and sailboats are permitted. The process vendors follow starts with a waiver agreement, requiring approval by the City Manager, Legal Department and final approval by the Commission. The committee agreed to proceed with the business plan as presented. The goal of the marina is to be self sufficient, and CPI increases should have a minimum of 3 % and a maximum of 6%. The meeting recessed at 9:24 a.m. Ms. Wilson called the meeting to order at 9:35 a.m. Pier 60 Mr. Held reviewed the Pier 60 business plan, which is scheduled for presentation to the Commission September 5, 1996. A major objective for Pier 60 is for revenues to exceed expenditures, and ensure the City receives fair market value for its investment. Mr. Held would like to change Pier 60 from an enterprise fund to a general fund activity. As an enterprise fund, Pier 60 incurs more than $60,000 in general fund charges. Red tide and Pier park construction, which closed the entrance to the Pier, have affected revenues negatively this year. In order to meet the bottom line, Pier 60 must become a general fund activity. Nine of the past ten years Pier 60 has not broken even. The budget includes routine maintenance, and it was decided $20,000 for the first year would be sufficient. In future years of the plan, $20,000 would go into a capital improvement project, If the money is not spent in a particular year, it may be spent the following year for unforeseen maintenance problems. Pier 60 was paying the Parks and Recreation Department $11,000 to empty trash containers, and it was determined increasing hours for part time employees would save $6,000 to $11,000 annually. Plans are to increase pier revenue 5% each year from $290,000 the first year, to $352,495 the last year of the plan. Future plans include continuing the operation of the pier under the control of the Marine Department, with maintenance provided by the Marine Service Section, ensuring the pier is competitive with other fishing piers in the area. Should the pier be changed to a general fund activity, administrative support at no charge to the pier would continue. Revenues and expenditures were reviewed on pages 14 and 39 of the "Second Draft, Pier 60 Business Plan", dated July 1996, A projection of $20,220 for next fiscal year, to $30,659 for the last year of the plan, would go back into the general fund. Mr. Held emphasized $20,000 in equipment service and CIP is strictly for routine maintenance. The pier is three years old and no major structural problems are foreseen. A question arose about the differences between an enterprise fund and a general fund. It was explained an enterprise fund pays costs to other departments. The 1995/96 mFRC08.96 8/1/96 4 t:> " , , The meeting adjourned at 10: 15 a.m. ,. ~:' ,.1. '.. '.,.~ I ~". . ',,:.~ I h " . . <O;,.'<'~\\, .':;:':'.,.~j.~~.> :<,. .:. .' ~ year deficit is unusual, but because of red tide and construction, the deficit was high. Average deficits are $20,000 to $30,000. Mr. Held stated the marina is sponsoring a fishing tournament for handicapped children on October 5, 1996, called "The Make a Difference Tournament". Children will be given free tee shirts and can fish free of charge. It was noted, no fishing license is required to keep fish caught at the pier. Telescopes strategically placed at the pier encourage people to pay $ .50 to walk to the end of the pier. Hot dog and sandwich sales, and "Sunsets at Pier 60", which includes entertainment and sales of home made items are very popular at the pier. The pier park is separate from Pier 60, and is scheduled for completion in September 1996. Maintenance will be under the Parks Department, but concession 'control will be under the marina, with revenues going into the general fund. The physical layout will include a pavilion for concerts and a park for children to enjoy, A suggestion was made to showcase the marina, pier, and sailing center on C-View TV during intermission at Commission meetings. It was also suggested placing fliers in utility bills, and it was noted there is usually a waiting list. Mr. Held was complimented on the information in the business plan, as well as on the operation itself. The committee agreed to proceed with the business plan as presented, noting the goal of Pier 60 is to be self sufficient, and CPI increases should have a minimum of 3% and a maximum of 6%. Attest: ~JrJ)OlJ~ Board Reporter o mFRC08.96 5 8/1/96