City of Powell River’s committee of the whole will receive a staff report detailing discussions held at the city’s finance committee regarding harbour rates and regulations bylaws.
It was standing room only at the November 24 finance committee meeting, where chief financial officer Mallory Denniston outlined proposed changes to the north harbour and to the south and Westview harbour rates and regulations bylaws.
Denniston said suggestions in the report for increases for the north harbour mooring contract holders were a “base case,” which is the break-even. The recommendation was for a seven per cent increase in 2023, 10 per cent increases in 2024 and 2025, and five per cent increases in 2026 and 2027.
“The harbour would break even and cover its operating and property tax costs, as well as save for capital for the future,” said Denniston.
She said harbour invoices must be sent out on December 16 for 2023, so if changes for 2023 are to be incorporated, she would need direction to put the rates forward for the December 1 city council meeting.
Denniston said the current bylaw does not have a requirement for moorage contract holders to carry marine liability insurance. She said of 20 harbours elsewhere surveyed for marine liability insurance, 17 required liability insurance. She said the proposed bylaw stated that on January 1, 2023, all mooring contract holders must hold a minimum of $1 million in marine liability insurance.
“This requirement would protect contract holders and the city from incurring potentially significant costs should an event occur,” said Denniston. She said when the matter was originally discussed in June of this year, January 1, 2023, was a reasonable target for a start date, however, that is too tight a deadline. She said to address this, the starting date could be moved to July 1, 2023, to provide harbour users with sufficient time to get insurance, and a survey if that is required.
Denniston said rate increases the financial model is proposing for the north harbour base case are larger than normal rate increases. She said there was a proposal for a very large increase of 125 per cent for transient vessels in 2023, followed by the same increases as proposed for contract holders in the following four years.
“These rates would result in the harbour revenue covering harbour costs,” said Denniston. “Right now, we are operating at about a $133,000 loss, so that’s why these rates are being proposed.
“I’ve received a lot of questions on why it is so steep. I generally focus on rate setting for what our costs are and setting us up for success in the future.”
Denniston said the harbour rates have not been kept current. She said the north harbour has had an average increase of 0.94 per cent per year for the last 11 years. There have been three increases, she said, with three per cent in 2016, five per cent in 2021 and two per cent in 2022.
Denniston said with the current rates, taxpayers are currently subsidizing this non-public service.
Regarding discounts for seniors, it has been noted there are two marinas on Vancouver Island that have seniors’ discounts. In a report, Denniston stated that 47 per cent of the 2021 moorage collected at the north harbour was at the seniors’ rate, which provides an 11 per cent discount.
Denniston also brought up a tiered rate system, where residents of qathet Regional District (qRD) and other locations would be assessed a higher moorage rate.
“It’s not recommended to set a tiered harbour rate system at this time,” said Denniston.
With the current contract holders, 64 per cent are from City of Powell River, 25 per cent are from qRD and 11 per cent are from other locations.
Expressing objections
After Denniston’s presentation, councillors had the opportunity to ask questions of Denniston. The committee then opened the floor to people in the gallery who wanted to speak to the harbour rates and regulations bylaws. Eight people took advantage of the two-minute per person opportunity, expressing objection to the direction that had been proposed to council. Recommended during the presentations was the establishment of a committee to deal with harbour matters.
Councillor Cindy Elliott said she agrees that a committee is needed to talk about how the city might manage the facility better.
“I wouldn’t mind starting that process in our motion, somehow,” said Elliott. “I’m for striking a committee and I’m for a motion that has a five per cent increase at this point, and a no more than one per cent decrease to seniors’ rates.”
She also recommended an extension to October for insurance.
Doubt makes motion
Councillor George Doubt said as far as rates are concerned, a seven per cent increase is not outlandish. He said the latest figure he heard for inflation for Canada is around six to seven per cent per year.
“A rate increase of seven per cent would generally be matching inflation for 2022 and 2023,” said Doubt. “As for 2024 and 2025, the recommended 10 per cent is maybe a little high. If I was picking my druthers, I’d like to see that closer to seven per cent in those two years, hopefully going down to five per cent. Staff have told us there is a shortfall in the north harbour and it is being picked up by other taxpayers.”
Doubt made a motion to forward the matter to the committee of the whole, to ask staff to come back with a recommendation that reflects a continuing seniors discount, plus a requirement for insurance, and for increases of seven per cent in 2023, 2024 and 2025, and five per cent in 2026 and 2027.
Mayor Ron Woznow proposed an amendment for increases to be tied to the cost of living but the amendment failed.
Elliott suggested an amendment for rate increases of five per cent in each of the five years but the amendment did not get a seconder.
Doubt’s motion carried.
Council also passed a motion for staff to bring a report on forming a north harbour users select advisory committee.
