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Occupancy decline may sink Oak Harbor marina’s rate hike

The sun sets over Oak Harbor Marina. The facility’s occupancy is dropping and officials hope abandoning a scheduled rate hike will help address the issue.  - Justin Burnett / Whidbey News-Times
The sun sets over Oak Harbor Marina. The facility’s occupancy is dropping and officials hope abandoning a scheduled rate hike will help address the issue.
— image credit: Justin Burnett / Whidbey News-Times

Despite having spent or committed millions of dollars to recent improvements at the Oak Harbor Marina, occupancy is on the decline and facility officials are now looking to abandon plans for a scheduled 2012 rate hike.

According to Steve Powers, director of Development Services, winter has always been one of the slowest times of the year as many tenants take their boats out of the water in an attempt to save money.

However, occupancy has begun to fall and is now down about 8 percent from the yearly average. Powers said the 421-slip facility is still self-sufficient and he has no concerns about solvency, but the reduction is being monitored closely.

“It’s something we are keeping a close eye on,” Powers said. “But we’re not panicking.”

Hoping to retain its remaining customers, and lure a few back that may have moved to other marinas or are out of the water in neighboring communities, Powers said the Marina Advisory Committee has recommended the city not move ahead with a previously approved 5 percent rate increase.

In late 2009, the city council adopted a schedule in which rates would go up that much every year for three years. The money would be used to pay for operations and maintenance, build capital reserves and help implement small parts of a $19.2 million marina redevelopment plan.

Two phases of the document, and two rate increases, have already been completed. They include the purchase and installation of a new main gangway, improvements to the electrical system, repaired floats and a massive dredging effort.

It was funded with $2.56 million in general obligation bonds that will be paid for over 20 years. The bond payments, which tab out to about $185,000 a year, will be covered with funds raised from a separate schedule of rate increases.

Finally, new security gates were installed at the head of each pier just this month. Although access to those areas will be limited to boat owners, the public will still be able to walk on the main pier all the way to the end of the dock where transient moorage is located. Work on the gates is still ongoing but marina staff expect to flip the switch by mid January.

All in all, many tenants say the marina has never looked better, that staff is both competent and friendly and that rates are comparable with other facilities. Yet, occupancy is on the decline.

In February of 2010, the marina was about 70 percent full. That dropped to about 66 percent during the same time this year and is currently hovering around 62 percent.

While there is a tipping point, where the cost of improvements drives customers away, Powers said he doesn’t believe that’s what’s happening.

“If I’m going to chalk it up to anything, it’s the economy,” Powers said.

Interim Harbormaster Chris Sublet said he supports the measure and believes it will help improve the marina’s overall occupancy. While small trailerable boats have disappeared as usual, the loss of larger boats has caught his attention.

Foregoing the scheduled rate increase, which for a 30-foot boat would be about $10 more a month, will not only help retain existing tenants like the marina’s approximately 15 live aboards but also help attract new customers.

“It affects everybody,” Sublet said. “$10 a month, that’s $120 a year.”

“Price is an important factor in this day and age,” he said.

The increase was adopted by the city council, so not implementing it will also require their approval. The issue is expected to be heard at the Dec. 20 meeting at City Hall.

 

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