HomeMy WebLinkAbout06062011 City Council Work Session Notes - Harbor Enterprise Rate Review WORK SESSION NOTES ON Ha Y bnof talaprict,k_-ft
. vie IA) %/I)
0 ' .
IA 1,6 ot it vxdb^Purpose:
Present: 1 r) 0oltS, Council Members Present: •i rir re a
10 ,C. Carr ��; n'irr Norm raa).5 va Ic10 ti, '141- k`-et �r ya �"
GIYWin h CG, e)1 Efichin— j
�a�,_, irA Called by: x
lr '� Tim .00 . /n Date (p -(p- a F'/ /
,)0Yn3 ** ***************************************************
ROY) ( a oi r yl,'1-WZY) : qa ve. p O y) Cf f YYPo it a fize-
TOrn I ori.°'� Volli. i/ 7ac. ft ' 6) q --tIcuce i remal/tivri tr.
tOrQ /}(� 9-( (cmd .pY-t, t k'"� V? <Jvi iI/d?r/Ina/rv_k? 1) 4Q61Ct° 11'`..It yz.f/
1)11111. �Cvi cai /tics 's aG/a-dor3 .,
---�'_. rrVI a(I r ,b-f f # : U Z. ? ;f
10 l .510(1/4-0n'
(2010- d cf?e, :- ii, -,,-f-r i 7
Dt\-;)4r,i i i ti„,,,, 4101.
A - i J au Cvi_-1/1 i i 'k// ckl i a-k ru,t d,.f "1 i)r ac/
`turd c 011 Cri- / , v irl as /a/� G 1 ', a rely cy, hthr
lya rt t i t.0:), . .4!pc(i e 3470 Atooral( fnGI'-!tom
p- Y? 1 9 0/, 4 a r' la k / kg 'ilr'kl ' u i
,p
(.JtJo lti' k-6
otA 'r_,
Y{ OMMtcif 4 j i ilOu treA, ` v nsi i' y gape:/ I lc Ya{
YakS)191 17L V d *in a1 r .furl y i /O r - ,
3')-Y 6.4c loiraY) rapit 1 Ikr)pnve.ht t p1a,, i p.k r)L1t fi
yitioura Yat -ID. fl C P Cokfin tit Ck . - -.� � t
sih , 6( to *I/ay &fi/ -:rte ilia!
mirvel/271- �lus cf tea vim,-
end oFvow : � i, . ay, 8,8'
(0,0461 ., birifj �GuA O 611(7-A&:�
(ook G,PCw-472.1/1d (10s.t..)
Harbor Enterprise Fund
Capital Requirements & Funding Strategies
. . .._. .
Harbor Cash Balance History
Balance @ #months'cash Balance @
12/31/XX Cash Total 11/30/XX
2000 449,499 0.4 449,499 388,911
2001 55,457 0.5 55,457 (157,289)
2002 81,570 0.5 81,570 (180,151)
2003 190,329 0.8 190,329 (67,284)
2004 420,106 0.7 420,106 109,015
2005 389,828 0.7 389,828 364,558
2006 696,610 4.0 696,610 62,473
2007 1,371,228 6.6 1,371,228 417,849
2008 1,169,083 5.2 1,169,083 471,587
2009 1,160,729 3.8 1,160,729 181,587
2010 1,534,331 5.7 1,534,331 229,928
5/11 942,808 3.4 942,808
1,800,000
1,600,000
s.s 5-- ,------÷ # months cash
1,400,000 —
5.2 3.8
1,200,000 — — - --
1,000
800,000 4.0 --
600,000 0.4 —
0.7 0.7 -
400,000 — -- —
200,000 — 0.5 05 0.8
- LH
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 5/11
MRRF Cash Balance History
MRRF
Cash Source of Cash
2000 -
2001
2002 -
2003 -
2004 -
2005 -
2006 -
2007 16,223 Commercial Passenger Vessel (cruise ship) tax
2008 353,853 Commercial Passenger Vessel (cruise ship) tax
2009 573,253 Commercial Passenger Vessel (cruise ship) tax
2010 1,053,856 CPV = $847,610; CRR = $62,745; Fish Tax= $143,501
11-May 1,428,149 CPV = $1,221,903; CRR = $62,745; Fish Tax = $143,501
CPV = Proceeds from State commercial passenger vessel tax (cruise ship tax)
CRR = Capital Renewal & Replacement Fee implemented in 2010 (billed) for 2011
Fish Tax= General Fund began transferring raw fish tax to harbor in 2010
•
Harbor Capital Infrastructure
HARBOR ENTERPRISE FUND - Needed Repairs & Replacement of Existing Assets
Replace Maint Total
2012 - 120,000 120,000
2013 2,413,500 20,000 2,433,500
2014 60,000 275,000 335,000
2015 7,100,000 - 7,100,000
2016 2,250,000 - 2,250,000
2017 - - -
2018 1,000,000 - 1,000,000
2019 - - $ -
$12,823,500 $ 415,000 $13,238,500
8,000,000
7,000,000
6,000,000
5,000,000
4,000,000
3,000,000 ■Maint•Replace
2,000,000
1,000,000 •
0
.....
O~� O~� O~A O~ 01� 0O~OO~�
Harbor Outstanding Debt at 1 / 1 /2012
Balance 2012 Budget Balance
Description Interest Rate @ 1/01/12 Principal Interest Total @ 12/31/12 Term
2000 E-Float & Cleaning Stations Bond
Ref2007 4.85% - 5.5% 1,935,000 155,000 87,575 242,575 1,780,000 2000 - 10/2021
2005 Float Extension Bond - Step 1 3.00% - 4.50% 1,205,000 65,000 50,836 115,836 1,140,000 2005 - 12/2025
Motor Pool 50-Ton Lift Loan 5.50% 124,783 22,358 6,863 29,221 102,425 2006 - 01/2015
2006 South Harbor Bond 4.00% - 6.00% 3,740,000 180,000 159,280 339,280 3,560,000 2006 - 06/2026
Totals: $7,004,783 $422,358 $304,554 $726,912 $6,582,425
. .
Passenger Fee History
❑ 2010 = $544,947
❑ 2009 = $503 ,283
❑ 2008 = $657 ,247
❑ 2007 = $691 ,600
❑ 2006 = $625 ,535
2011 Bond payments = $703,459
Passenger Fee Bond cash balance @ 12/31 / 10:
$249,553
2012 Debt Service
❑ If 2012 generates $545 ,000 in Passenger Fees
(same as 2010) the Harbor will need to utilize
$ 158,459 from moorage revenues to pay this
debt service.
❑ Previously this difference has been covered
by passenger fee reserves, however these
reserves will be insufficient to cover this
difference by the end of 2011 .
Critical Capital Needs 2012-2013
Highly Likely to Fail in the Next 5 years, must be accomplished
❑ Replace D Float- $2.363 million
Pilings = $353,200
■ Mob/De-Mobilization/Salvage = $370,000
■ Floats & Connections = $783,370
■ Water/Fire System = $ 133,750
■ Electric System = $231 ,625
■ Engineering/Permitting/Safety
Equipment/Contingency = $491 ,055
If we do not fund critical capital needs :
❑ In the next 5 years D float will be taken out of
service- affecting 40 foot vessels. Currently we have
79 individuals waiting for this size of slip, the
longest has been on the wait list since Nov 2008. D
float has a total of 58 vessels, 13 of these are
passenger vessels.
❑ Annual revenue for D float (moorage only) is
$ 101 ,700.00
❑ Other revenues from this float includes: passenger
fees, electrical use, and CRR fees
High Risk Capital Needs 2014-2020
Likely to fail within 5-10 years
❑ Replace A, B , C & S Floats = $6. 1 million
❑ Maintenance Dredging = $225K
❑ Replace K & L floats = $2.25 million
❑ Replace N & S Launch ramps = $2.0 million
❑ Replace Fish Waste Barges = $70K
Total 2015-2020 = $ 10,645,000.00
Moderate Risk Capital Needs 2010-2020
Continuous Increasing Cost to Maintain & Operate
❑ Harbormaster Restrooms- $ 100,000
❑ Trash Dumpsters Replace- $40,000
❑ Used Oil Stations Maintain- $60,000
■ Total $200,000
Summary of All Capital Needs
❑ Between 2012-2013 : $2,553,500
Replace D Float
Restroom & Used Oil Station Improvements
Replace Fish Waste Barges, Dumpsters
❑ Between 2014-2020: $ 10,685,000
Replace A, B, C & S Floats
Replace N & S Launch Ramps
Replace K & L Floats
Maintenance Dredging
Capital Replacement Funding Strategies
❑ Options A- Fund all Critical/High/Moderate
projects needed for the harbor through 2020.
❑ Option B- Fund only Critical & Moderate
Risk Projects in 2012 & 2013 and Rely on
Grant & Legislative Funding for Half of
Required Funding
❑ Option C- Rely on Grant & Legislative
Funding
Option A- Fund All Capital
Improvement Projects 2012-2020
❑ Assumes no grants or tax revenues
❑ Requires $ 13 ,238,500 over 8 years . . .
$ 1 ,654,812 needed each year
❑ Would require 118% increase in Moorage:
D Float could be Replaced in 2014
. •
Option B- Fund Critical & Moderate Risk
Projects 2012/ 13 with Half Grant Funding
❑ Critical & Moderate Risk Projects total $2,553,500
❑ Grant Funding Required: $ 1 ,276,750
■ Municipal Harbor Matching Grant Program (D Float)
■ ADF&G Sportfish Grant (Fish Waste Barge)
❑ Remaining Funds Required: $ 1 ,276,750
■ CRR Fees $200,000 (2012 & 2013 Total)
■ CPV Funding $ 100,000 (used for Restrooms only)
■
34% Moorage Rate Increase = $976,750 (2012 & 2013)
Option C- Fund all Projects with Grant
and Legislative Funding
❑ Not a realistic approach due to grant matching
requirements
❑ Requires $2,553,500 in the next two years.
❑ Hire A GRANT WRITER !
Harbor Moorage Rate Comparison
o Tenant Vessels- Seward' s rates are less than
Whittier, Juneau, and Kodiak (Kodiak' s rates
are lower for vessels under 50 feet)
o Transient/Guest Vessels- Seward' s daily rate
is less than Whittier, Homer, Valdez, and
Cordova
o Valdez, Cordova, and Sitka have a higher
transient rate if customer is billed (does not
pay in advance)
Administration
❑ Continue to link moorage rates to the CPI
2012 = 2.86%
2013 = 2.6%
❑ Increase the Transient/Guest Moorage Rates by 10%
. a Would generate $40,000-$50,000 additional revenue
el Rates would be less than Homer, Whittier, Kodiak, Valdez, Cordova
❑ Continue CRR Fee
❑ Continue to Transfer Fish Tax to Harbor Enterprise Fund
❑ Recommend Formal Rate Study and 10 year with funding
strategy based on capital improvement plan
4
Options to Consider
❑ Additional Revenue from implementing a
Marine Fuel Tax
o Revenue Bonding with increased Capital
Renewal and Replacement Fee
❑ State GO Bond
o Investigate AKRR Port Fees
o Combination of increasing moorage rates &
revenue bonding
Current Status of Harbor MRRF Fund
❑ Balance at the end of 2010 =$ 1 , 134,818
❑ 82% ($928,571 .50) of these funds are CPV
funds with restricted and planned use
❑ $62,745 reflects Capital Renewal &
Replacement Fee
❑ $ 143 ,501 reflects Raw Fish Tax
❑ Total Funds Available for Capital Projects
including D float replacement = $206,246
Projects Utilizing CPV Funds
❑ Security (Z) Float- Completion
❑ USCG Relocation
❑ Harbormaster Restroom Improvements
❑ Ambulance Services
❑ USACE Breakwater Close-Out Costs
❑ Bus Transportation
Other Recommended Tariff Changes
❑ Eliminate Quarterly Rates
o Establish a Rate Structure to Benefit Tenants
by Increasing the Daily (Transient/Guest)
Rate
o Restructure Harbor Electric Fees to Include
the Connect Fee in the KWH charge
❑ Evaluate SMIC Electric Fees
CITY OF SEWARD Harbor Department
P.O. Box 167 ° 907.221.3138 907.221.7187 Iax
• 1.10 Acl uns Si cet '' h:u boimastet cc @cityolsemull.net
Sew:uxd,Alaska 99661 4440*
June 1, 2011
Mayor Dunham & Seward City Council Representatives:
Budget time is upon us and I have prepared the attached packet of information for you in
advance of our June 6th work session regarding the Port&Harbor Tariff Regulations and Capital
Improvement Funding Strategies. Within this packet you will fmd:
- Aerial Harbor Map
- Inspection Report on A, B, C, D, G & S Floats and the South Harbor Launch Ramps
- Spreadsheets on Critical, High Risk, and Moderate Risk Needs and other capital
improvement projects for the Harbor and SMIC
- Rate Setting for Port &Harbor Facilities by Northern Economics
- Moorage Rate Comparison Sheets for Various Harbors (note: page 1 is for Tenant
Vessels = Slip-Holders, and page 2 is for Transient Vessels)
- Recommendations for Changes/Updates to the Port &Harbor Tariff Regulations
The Port &Harbor Tariff Regulations may be found online at: www.cityofseward.net/harbor
If you click on "Harbor Info &Policies" on the left, it will bring you to a page with the Port &
Harbor Tariff... click "View Tariff."
Thank you for all of your hard work on behalf of Seward!
Sincerely,
Kt
•
Kari Anderson
Seward Harbormaster
r
SENN ARB II.--kRBOR
gip `;� '14-Z.,,, ..'''''"”', ' 11 1
9 k 1 �-
x
F i
N. ; __ — --_L- .mob.._ -- _ 4 _
.__ ,_
i•�
�.
-. r rx '�! �+�' M �t � it.„._ y' .4.a-ate. �- .=�a!
.....•k. r ....+. _ �- k y fila'�� ,. r� —`-. r.�r.• ts '_.i
'Tn � m` ` d"Y kir,t+w+ti. ll4 '-..s''� ' .*ter'+,tt 4 _:4
Yellow- Z, X, R, and NE Launch Ramp & Fish Cleaning Station G - M, N, 0, P & Q Dock Fish Cleaning Station
ki L, K, J, H, F, E Floats & J Dock Fish Cleaning Station 1Z D, C, B, A, S & S Launch Ramp, B Fish Clean
T, I &TraveLift Dock
,
i
i
3
i
f
1
,
FINAL INSPECTION REPORT
Seward Small Boat Harbor, Southwest Harbor
Floats A, B, C, D, G, and S, and South Launch Ramps
Seward, Alaska
,
f
P
44 t
' '-..t,t . '' , , l', ,,,ig;
t, f.:14,1 at 1
R 1YJ
�• s
i.. :ii.
fi .
January 2011
Prepared for:
Kari Anderson, Harbormaster
City of Seward , osaati�
P.O. Box 167 440,-\ ,..°E............• I1+4,
Seward, Alaska 99664 ♦ ••'
Prepared by: ".1 49th ` ,. *t
11 URS �..,..a
700 G Street so --t_ t
Suite 500 r JOHN C. DALE? r
Anchorage, Alaska 99501 ",�$'•1 CE-9572 �s
.ii..4446
....
.............
SS.
EXECUTIVE SUMMARY
The October 2010 inspection of the Seward Small Boat Harbor included a visual
inspection of the facilities in the southwest harbor including approach trestles, gangways,
and floating docks A, B, C, D, G and S Float as well as the south harbor boat launch
ramp. It did not include an underwater inspection.
The following is a summary of the findings:
• The floating docks in this section of the harbor were constructed in the 1960s and
are at or beyond their service life and should be replaced. They were generally
found to be in Poor, Serious, or Critical condition. All floats have hinges in
Serious or Critical condition. Several float sections are in danger of sinking.
• There is a geometry issue with the fairway space between floats A and B. This
space is well below current design standards and makes access to the slips very
constricted and difficult. This increases the risk of collisions during poor weather
conditions. Future renovations should consider ways to correct this by widening
the fairway. This may involve removing fingers from one side of either float,
moving A Float to the South, or both.
• There are two gangways at the D Float access trestle. One is a 5'x 100' aluminum
gangway and the other is an 8' x 50' steel gangway. Future renovations should
consider ways to provide one Americans with Disabilities Act (ADA) compliant
gangway in this location. The 5' x 100' gangway is ADA complaint and the 8' x
50' one is not.
• Floats A, D, and S are in the poorest condition in the harbor and were found to be
in Serious or Critical condition. Load restrictions should be placed on these floats.
The top of the floatation foam was found to be at or near the water surface on
these floats. This indicates that reserve buoyancy is nearly gone and buoyancy is
being provided by structural timber members. It is likely that these floats will sink
under a significant snow load or if a group of people congregate in one area on the
floats. Rot and grass was noted on the timber members. The hinge connections for
the fingers were in Serious or Critical condition
• Floats B, C and G are in Poor condition. There was about 2" of floatation foam
above the water on these floats. The hinge connections for the fingers were in
Serious or Critical condition.
• The south launch ramp boarding floats were in Serious condition and should be
replaced. They have about 6" of freeboard and little or no reserve floatation. They
may sink under a significant snow load or if a group of people congregate in one
area on the floats. The hinges on these floats have failed or are failing. The pile
collars on these floats have failed or are failing. There are no bullrails and
inadequate cleats. In addition there are an inadequate number of piling on these
floats.
• The concrete planks for the boat launch ramp are in Poor condition. The ramp
does not extend far enough and the lower end terminates in a drop off.
1
.i
• There is a storm water drainage pipe located just south of the south boarding float.
Runoff from this is washing dirt and debris under the south boarding float and
onto the concrete ramp. The bank is sloughing in this area.
• The potable water and piped fire suppression utilities are in Poor condition. The
piping and risers have been heavily modified over the years and contain numerous
fittings of differing materials. Some of the fittings are steel and are corroding.
• The pilings are in Poor condition. The majority of the pilings in this area of the
harbor are timber and have been in service since the 1960s. Many of the pilings
are worn and have flat surfaces where they have been scraped down over the
years by the act of tides and the pile collars. When the north harbor floats were
replaced about 10 years ago, several timber piling were pulled and cut for
examination. Marine borers were discovered and many of those piling were found
to have deteriorated interiors. No pilings were cut for this inspection but it is
anticipated that they are in similar interior condition to the north harbor timber
piling.
• This area of the harbor does not meet current American with Disabilities Act
(ADA) design standards. All but one of the gangways are out of compliance. The
one exception is the 100 foot long aluminum gangway at D Float. The transition
plates are not in compliance and there are no accessible slips in this area of the
harbor. In addition the main floats have metal grating fire breaks that do not meet
ADA standards for pedestrian access.
Cost estimates for repairs and renovations are outlined in the report. Two Options for
repairs and replacements are outlined.
• Option 1 includes replacing in-kind. For this option the float layout and number of
slips remains unchanged except that certain upgrades are provided to meet
minimum design standards. The cost estimate for Option 1 is $10 million.
• Option 2 includes recommended renovations associated with a new layout. These
include widening the fairway between A and B float, connecting the headwalk
float(G Float) to the headwalk float at E float, Realigning the 100' gangway at D
float access trestle, making S float and the south side of A float side-tide transient
floats, extending the launch ramp, and other minor items. The cost estimate for
Option 2 is $9.9 million.
• Several possible phases have been identified and cost estimates advanced for
these as follows:
1. Phase 1: D Float $2.4M
2. Phase 2: S Float $1.4M
3. Phase 3: Launch Ramps $1.3M
4. Phase 4: A,B,C, and G Floats $6.1M
Note that the cost estimates presented above are based on current prices—material
cost increases and inflation are not included in these estimates.
2
Condition Assessment: Rating System Description
A condition assessment rating system was chosen for the evaluation of the structure. The
purpose of a rating system is to provide a uniform and repeatable method of tracking the
condition of structures throughout their service life.
The correct rating assignment requires professional engineering judgment and considers:
• the scope of damage,
• severity of damage,
• distribution of damage,
• types of components affected and their structural sensitivity, and
• location of defect on the component relative to the point of maximum stress.
Therefore, the qualifications of the individuals assigning ratings are important to ensure
that the ratings are assigned consistently and in accordance with sound engineering
principles and the selected guidelines.
The rating system used in this report generally follows that recommended by the
"Standards of Practice for Underwater Investigations"published by the American Society
of Civil Engineers (ASCE, 2004). Ratings are assigned to each structure or element to
facilitate establishing the priority of maintenance, repair or replacement actions. A
numerical scale is used for routine condition assessments and should remain associated
with the structural unit until the structure is re-rated after a quantitative engineering
evaluation of repairs, or on completion of the next scheduled routine inspection.
The ASCE rating system, summarized in Table 1.1, uses a scale of 1 to 6 with 6
corresponding to a structure in good condition, and a rating of 1 corresponding to a
structure in critical condition. These ratings are used to describe the existing in-place
structure relative to its condition when newly constructed. The fact that the structure was
designed for loads that are lower than the current standards for design have no influence
on the ratings.
5
t
Table 1: Rating System for Overall Condition of Structures
RATING DESCRIPTION
6 Good No visible damage or only minor damage is noted.
Structural elements may show very minor deterioration, but no overstressing is
observed.
No visible safety issues are observed.
No repairs are required.
5 Satisfactory Limited minor to moderate defects or deterioration are observed, but no
overstressing is observed.
No significant safety l code violations are observed but minor safety issues
may be present.
No repairs are required.
4 Fair All primary structural elements are sound, but minor to moderate defects or
deterioration is observed.
Localized areas of moderate to advanced deterioration may be present but do
not significantly reduce the load-baring capacity of the structure.
Minor safety issues/code violations may be present, but no hazards that are
expected to cause serious injury or death are observed.
Repairs are recommended, but the priority of the recommended repairs is low.
3 Poor Advanced deterioration or overstressing is observed on widespread portions of
the structure but does not significantly reduce the load-bearing capacity of the
structure.
Minor-Moderate safety issues/code violations may be present, but no hazards
that are expected to cause serious injury or death are observed.
Repairs may need to be carried out with moderate urgency.
2 Serious Advanced deterioration,overstressing,or breakage may have significantly
affected the load-bearing capacity of primary structural components.
Local failures are possible and loading restrictions may be necessary.
Safety issues/code violations that could result in minor injury to the public may
be present, but no hazards that could cause serious injury or death are
observed.
Repairs may need to be carried out on a high-priority basis with urgency.
1 Critical Very advanced deterioration,overstressing,or breakage has resulted in
localized failure(s)of primary structural components.
More widespread failures are possible or likely to occur, and load restrictions
should be implemented as necessary.
Safety issues that could result in serious injury or death may be present.
Repairs may need to be carried out on a very high priority basis with strong
urgency.
Source: Underwater Investigations Standard Practice Manual(ASCE,2004).
Note: Items in table shown in italics are general facility safety issues(non-structural) that are not included
in the ASCE(2004)rating system.
6
•,,t,'-
1At. tS .M
i sA i. J 1"} •'''+,,,‘1,;,
`4Y• s 3' x sY4WS r
lYf' 'n 1 4'
y.i
., 116.
Drainage Impacting Boarding Float Bank Sloughing from Drainage
Level of Service and Service Life
A service life of 40 to 50 years is normal for modern waterfront facilities. One can expect
increasing maintenance costs and decreasing level of service as the end of the service life
is approached. At some point the owner must weigh the maintenance cost and the level of
service with the cost of replacement.
An analogy can be made to the service life of an automobile. It is easy to understand that
one expects a high level of service and reliability from a new automobile. When the
vehicle gets 10 or so years old, and has over 100,000 miles on it, one can expect
increased maintenance costs and a lower level of service. Perhaps not every item on the
vehicle still works like new. Perhaps the maintenance now includes larger and more
costly items. Although it is possible to keep a vehicle running indefinitely, it is
reasonable to expect increased maintenance and costs. In this regard the Southwest
portion of the Seward Small Boat Harbor infrastructure is analogous to a 20 year old
vehicle with 200,000 miles on it. It is still functioning, but there are serious issues with
maintenance and functionality.
r
The level of service that the Southwest portion of the Seward Small Boat Harbor
infrastructure currently provides is below the industry standard. The finger floats are
listing and not stable. The potable water system is pieced together and requires long,
garden hose connections strung across the floats. The piped fire suppression system is
pieced together and has numerous differing types of materials and fittings.
Condition Summary i
The table below summarized the condition rating of each primary element in the harbor.
Table 2: Condition Summar
ITEM RATING DESCRIPTION —11
A-FloatSerious
B-Float In —T
Poor I
C-Float 3 Poor
D-Float 2 Serious
10
G-Float 3 Poor
B-Float Access Trestle 4 Fair
D-Float Access Trestle 4 Fair
S-Float 1 Critical
S-Float Access Trestle 4 Fair
Boat Launch Ramp 3 Poor
Ramp Boarding Floats 2 Serious
Lighting and Electrical 4 Fair
Water System 3 Poor
Fire Suppression System 3 Poor
11
�i fir..!1-.w.>lti,�.. '� !4� *w ... 't1
V
,+a1. H s S^!4,' Y i����uuu5 h4 i�S'9aw,•n ivy+. d 45-.. i+
•
C Float Finger
C Float Fire Extinguisher
r ' ka
i• v A A a S '�Kr'F
...41P4'...••••........„.i s' ,
4e
i1 ) 4
• ' , ','‘ffiJ, :i�. .n1'�" �t4., 1; . .! � P , ''.y is it> rr,, 7 N�„v'r ' ,"ri s.'
C Float Hinge C Float Water Utility
D-Float
D Float is in Serious condition. Freeboard was 9 to 14 inches. The top of the floatation
foam was found to be even with the water surface indicating no reserve buoyancy. The
main float was listing. Several fingers were listing. The bullrails and decking showed
signs of rot. The hinges were loose and this allowed the fingers to rotate under load.
l
f
D Float Main Float D Float Main Float
15
•
,i,j --.. -4 -0,,, - -7..... .!....!...e;...7. '
,0i, _..ir' 1 . , boil,
i
I,,� , ;i ‘ fr
tf 3r .s
4
?`.
D Float Grass on Deck D Float Small Tree
1 ; ziP f j
,�py�y x
i ) t a
, i V ;, ,,,,,t4./y., ,
,r-'Vr. :,. a'.., ,l _ .a:1 \� f11 � �', •'.hN'IfIf f
,yam ' .
��' �/ ., .,rte .. ) d
q,' {taw.,
Sra t Pr r �','yx'
D Float Water Utility D Float Main Float
ithJ 4
, a` � � i'''f., 1 �
3
n
•I., g fi
y �,F z5 f 4 3R .s
,ay
D Float Finger D Float Pile Collar
to
G Float
G Float is in Poor condition. Freeboard was 12 to 16 inches. The top of the floatation
foam was found to be about 2 inches above the water surface indicating a small amount
reserve buoyancy. The main float was listing. Several fingers were listing. The gangways
were not centered on the gangway floats and the gangway floats were not level due to
eccentric loads. The bullrails and decking showed signs of rot. The hinges for the main
flat and gangway float connections were loose.
•
•
G Float Main Float G Float Main Float
pp
€ Vir #Ilii , r i r v11 + d'
£ ' 77, s • ia-„r ,,:. — - • ;-T1
G Float Main Float G Float Fingers
i , rp ' J 4 441
11 pp7
""tiritr Of
I
14,1
Ii
G Float Fire Riser G Float Worn Piling
17
„...� ,;,r's`'r 1 Yo u h_.1 ',1161,M
IAF'--r F V T
i .
1
1 u
-4 .''' , ;.: - .414%.,', :', 1 '',,,, ,4
rs,:
D Float Trestle Gangway Abutment D Float Trestle Gangway
N y
, �, I b Zs e y
t i.+' dvf.. ( jy{ P
' ',,y'-43-:-77- 7,,-,”'
7t7�/ r br i '{ t f 7. �r �, T �r7
�1J f 't '• ilk}:i i 1+ 2�_'t 1. ;1. ,.{ ,-
_ €., ry
I-- ,, ' 1
"` '' :.,:
D Float Trestle Gangways D Float Trestle Gangway Float
S-Float
A Float is in Critical condition. Freeboard was 6 to 10 inches. The top of the floatation
foam was found to be even with or below the water surface indicating no reserve
buoyancy. The main float was listing. The bullrails and decking showed signs of rot and
grass. Structural timbers below the deck are partially submerged and some are broken.
a n
h �'
f•b �,, ,,. t4S fit: $ lyA-i '
•
S Float S Float
20
t I
: �..-t4. r
ij V I '
FITS bi44t} ' _
MOS lil • -
IM
uai 1.
fLK r
S Float Grass and Rot S Float Grass and Rot
+tia ,
e fi�i"f'! `3i �Wf'�?b4Yrr... . �4, z
x1
rr q r, y' $' iAh`& Y"'' 5X ,.411.0.g'' , 1:
�I_ P Xi K ��i� y✓, ,7 Q j�,.. �
S Float Listing Main Float S Float Broken Bullrail
=:,, `+Sg"""r''�an 1' 4'` iaY `°,t--",f.:;;;-:.,..,,r;.-'`-::-1.4e"'..,_.„,...-„--1-77,,:�",j
R •
11 �. .fi"'"' d4 ', '' V I^f d ' ,T£'
y<t y �S ,.Yx.f riv 1, ft 2 iy``1
�n a •u( Apr
J
,{. t t an t •1
t
ti - .
r t
S Float Grass on Float S Float Grass on Float
S-Float Access Trestle
S Float Access Trestle is in Fair condition. The gangway does not meet ADA
requirements. The transition plates do not meet ADA requirements. The bullrails and
decking showed signs of wear. The handrails do not meet code. The gangway does not
land on a gangway float.
21
=s
J i �sc«z4r i as;,a 4 r�^i1i`.�r1 rt-i 7:�� �.... {�.3tj
.iJ1�MC ...1 t Y
A f
,i0s,,,
44
4sa
1
1 -
4
v A T
S Float Trestle S Float Trestle
Boat Launch Ramp
The Boat Launch Ramp is in Poor condition and the boarding floats are in Serious
condition. Freeboard was about 6 inches. The top of the floatation foam was found to be
even with the water surface indicating no reserve buoyancy. There are no bullrails on the
boarding floats. The pile collars and hinges are in Serious condition. Corrosion on these
items is to the point of failure. There are insufficient piling for the two outer floats. The
concrete abutments have damage including pulling out of the anchors. This is likely due
to the insufficient number of pilings resulting in most of the loads going into the
abutments and pulling them apart. There is a drainage problem south of the south ramp
that is causing erosion and sloughing of the bank. The ramp does not extend far enough
into the water for low tide launching. The lower end of the ramp terminates in a drop off
that can be dangerous to trailer operations.
. �
I r''
01111111.1111
1111111111 ----
...., ... -ION A'
a
"- ,,ami �yii�X_j '•�''_'
Boat Launch Ramp Boat Launch Ramp
22
:
fi r t F'':, t 3 ticrz t . '
ritb
iC
i' r , t ,� . 5'78 " /`tY-tit..'
4 4
"' t —'� ,,fit A mit f 1 uY'""4-'
4 0,5 3 , , t t ' ';j. VI I '-' , 5 S tr ,4`�TY...P 77
"2 A 7 r f La
tt N, ,, t st.u„r 't``4 .,r L r 2" Ct s� 4y{
..\''''W.,
• yt 6 f
u of X 4 Igita _
s "G, � t. �,.+ .^,,5 �2r`...�., Mme-.
fi
Boat Launch Ramp Center Float Boat Launch Ramp Pile Collar
A; i
s
tt
ks:i �T8 5 I F
til c y
n '' C'lieW,11''`T ':i ,
4 ! 'II
1�? ,, a t
t ''f, ' I ,Sk'4,- i t o ,',=2•'' j t;',-,1‘' '' ,�
'4.'Lr Yt a ' 4A 3 f*."11 rti}t� 4.1';. .
� is +, t�`� y �!
i 3 �F t RS i' S f,s
' i, t 8 M1 d 1�� ,y�`.j�:..
Boat Launch Ramp Pile Collar Boat Launch Ramp Abutment
•
q 1
f u a4(_*
•
,
x.�,m-'c a, ,7.,....;
ag
. ..:.!._(.'..,:.-'7,1f.:1.14,40',A''''
kk
TM4r,Y,e t liti- 1? 4 qv;}"\
Boat Launch Ramp Drainage/Erosion Boat Launch Ramp Drainage/Erosion
Potable Water System
The Potable Water system is in Poor condition. It has been patchedand modified
numerous times over the years. This results in a number of differing materials being used
in the system including galvanized steel pipe and fittings, brass fittings, HDPE pipe and
fitting, and others. Several user installed connections were observed. These often include
23
,
4;4 �
pc ,sa�r . 7;
mac
.��
• t r.Y- 3 .;:far T „� � rYus �,�-' fi,'
�� '>' la�. rSY 3Y ISS, '�.'. (
T u.' X g'i;c Y Sfi�skpy
Cabling Subject to Physical Damage Damage to Telephone Cable
G Float
There is a single pole light on float G at the bottom of the float D access ramp, which is in fair
condition. There is a single shore power connection for the Harbormaster's Office boat which
is in excellent condition.
Condition Summary
The table below summarizes the electrical system condition summary:
ITEM RATING DESCRITPION
A-FLOAT LIGHTING 2 Serious The lighting levels on the float do not appear to meet
IES recommended levels, and the equipment is in
poor condition.
B-FLOAT LIGHTING 2 Serious The lighting levels on the float do not appear to meet
IES recommended levels, and the equipment is in
poor condition.
B/C-FLOAT 4 Fair Some minor corrosion, missing hardware and
DISTRIBUTION deteriorating panel stand.
B-FLOAT SHORE POWER 3 Poor Missing hardware, missing covers, damaged outlets
C-FLOAT LIGHTING Serious The lighting levels on the float do not appear to meet
IES recommended levels, and the equipment is in
poor condition.
C-FLOAT SHORE POWER 3 Poor Missing hardware, missing covers, damaged outlets
D-FLOAT LIGHTING Serious The lighting levels on the float do not appear to meet
IES recommended levels, and the equipment is in
poor condition.
D-FLOAT DISTRIBUTION 4 Faire _ Some minor corrosion and deteriorating panel stand.
D-FLOAT SHORE POWER 1 Critical Severe damage to enclosures, non-weather tight
plug and receptacle connections, improper strain
relief, non-weather proof enclosures, broken covers.
G-FLOAf LIGHTING Serious The lighting levels on float A do not appear to meet
IES recommended levels, and the equipment is in
poor condition.
G-FLOAT SHORE _ - 6 Good Brand new condition ��—
POWER
ELECTRICAL SERVICE 5 Satisfactory Relatively new and without significant code or safety
�.._u._ concerns.
3. RECOMMENDATIONS AND COST ESTIMATES
Recommendations:
The facilities included in this condition assessment are generally in Poor to Critical
condition. Some elements, including unstable finger floats, lack of reserve buoyancy,
and degraded electrical systems, on some of the floats pose a public safety risk. It is
evident that the City has spent considerable time and effort in maintaining these floats to
ensure continued performance and safe use. However, it is clear that the maintenance
and cost that will be required to bring these facilities to modern standards outweighs the
cost of replacement. For this reason, we have proposed two optional layouts for
replacement:
1. Replace In-Kind: This scenario maintains the same number and size of permanent
and transient slips, but provides some upgrades to meet modern standards. These
upgrades include increasing the width of the S and A Floats to 10-ft, reconfiguring
the gangway arrangements to provide a gangway landing float away from the flow of
traffic and to ensure ADA compliance is maintained, upgrading from timber to steel
piling and increasing the number of piling as needed. This option does not relieve the
problem with inadequate fairway width between A float and B float or the congestion
near the launch ramp fairway. In addition, it does not provide improvements
associated with extending the launch ramp and boarding floats. The layout associated
with the Replace In-Kind scenario is illustrated in Figure 2.
The following table provides a summary of the number and size of slips for this
layout. The construction cost of this option is estimated at about $10M. A detailed
cost estimate is provided in Appendix B.
Table 3: Slip Summary for Replacement In-Kind
Slip Count Note
Length
Linear 290 ft S & G
17ft 67 S & G
23ft 58 A
32ft 116 B & C
42ft 58 D
2. Recommended New Layout: The recommended layout addresses the fairway widths,
provides improvements to the launch ramp, and connects the headwalk floats between
D and E Floats. The layout associated with the Recommended New Layout scenario
is illustrated in Figure 3.
25
To provide a fairway between A and B Floats that meets design guidelines, no fingers
are provided on the south side of A Float. Eliminating these fingers will provide
space, and A Float will be moved south approximately the length of one finger
accordingly. No fingers are provided on S Float, which will provide linear (side tie)
moorage on both sides of that float. This in effect decreases the congestion in the
aisleway between S and A floats where conflicts between launching vs. parking boats
can occur. Also, during busy times (i.e., Silver Salmon Derby) the transient moorage
on both sides of the aisle (on A Float and S Float) will help to relieve launch ramp
wait time and congestion in the parking area above the ramp. The estimated
construction cost of this option is similar to the Replace In-Kind option, at $9.9M. A
detailed cost estimate is provided in Appendix B.
Table 4: Slip Summar for Recommended New Layout
Slip Length Count Note
Linear 1565 ft A, S & G
17ft 0 -
23ft 29 A
•
32ft 116 B & C
42ft 58 D
Phased Replacement:
Depending on the available budget, the replacement may be done in phases. It is
generally advisable to do the work in contiguous sections and in a way that will make
future work simple to coordinate. In this regard the following standalone projects are
outlined:
1. Phase 1: D Float $2.4M
2. Phase 2: S Float $1.4M
3. Phase 3: Launch Ramps $1.3M
4. Phase 4: A,B,C, and G Floats $6.1M
A detailed cost estimate is provided in Appendix B.
Phase 1: D Float is in a heavily used area of the harbor and with the existing condition
rating of "Serious" the recommended D Float replacement should be considered a high
priority. This phase of the project would focus on replacement of D Float in accordance
with the final layout plan. Because the final layout includes moving the headwalk float
shoreward to align and connect with the headwalk float at E Float, the Phase 1 project
would postpone the installation of two of the finger floats nearest the headwalk float.
During Phase 4, D Float would be extended, connected to a new G Float, and the two
additional finger floats installed at that time. This may result in a temporary relocation of
a few slips on D Float during the interim period.
26
Phase 2: The recommended S Float replacement project would include a new access
trestle / abutment, a new 6'x50' aluminum gangway, a new gangway float and a new
main float. The new layout allows for side tie/transient moorage on S Float and provides
for additional clearance in the launch ramp loading fairway between S and A Float. The
existing condition rating of this float is "Critical". Replacement of S Float should be
considered a high priority. Because the vessels that currently moor at S Float are smaller,
and more easily removed and trailered, this facility is considered a lower priority than D
Float and hence identified as the second phase project.
Phase 3: The recommended alternative launch ramp renovation project would include
new boarding floats, an extension of the concrete ramp planks below the minus tide line,
extending the boarding floats, re-grading the drainage ditch on the south, repairs to the
abutments, and additional piling. The existing condition rating of the South Launch
Ramp facility is "Poor" to "Serious". Replacement of this facility should be considered a
medium-high priority.
Phase 4: The recommended alternative replacement of A, B, C, and G Floats project
would include modifications to the two trestles, two new gangway floats, a new 6 x 80
foot aluminum gangway, and new floats. In addition, this phase of work would provide
for a new headwalk float that will connect to the existing headwalk float at G Float. This
will also provide for a wider channel between this area of the harbor and the South harbor
area (MNOPQ Floats). The south side of A Float would be designated for side-tie
moorage which will provide for a more appropriate fairway clearance between A and B
Float and hence ease congestion and risk of collisions in this area. The existing condition
rating of Floats A through C and this portion of the headwalk float (G Float) is "Poor" to
"Serious". Replacement of this portion of the harbor should be considered a medium-
high priority.
The benefit of proceeding with a phased approach is primarily to allow more immediate
improvements to the facilities that are in more critical need for replacement, if funding is
not available to proceed with the entire project. The disadvantages include increased cost
for multiple contractor mobilizations, material cost changes and inflation for the later
phases of the project. Note that the cost estimates presented above are based on current
prices—material cost increases and inflation are not included in these estimates. Inflation
can be about 10% for every year the project is delayed. Material costs changes are more
difficult to predict.
It is important to note that each time a separate project is advanced there will be
administrative, engineering, permitting and mobilization costs. Therefore it is generally
more efficient and less costly to advance one large project as opposed to several smaller
projects. Administrative and engineering and permitting costs can be generally in the
range of 15% of the total project costs. Mobilization can vary considerably depending on
the nature of the work. For example it will be more costly to mobilize a barge and crane,
if required, then to do the work from the shore. In general, for the types of projects
outlined here, mobilization can range from $150,000 to $400,000.
27
On Going Maintenance of Existing Facilities:
Previously an analogy was made between service life and a vehicle. Similarly
maintenance of older existing facilities can be analogous to maintaining an old vehicle. It
can be anticipated that maintenance costs will increase with age. It can also be anticipated
that some of the maintenance items will"major" and may be very costly.
The owner is forced with trying to make a decision regarding how much money to
continue to spend on facilities that are at the end of their service life and are scheduled
for replacement. There are no easy answers for this situation. It depends on funding levels
and the schedule for replacement. It is also important to note that there are many facilities
around the nation that have far exceeded their service life and are being maintained well
in excesses of planed replacement simply due to lack of funds. With this in mind it may
be prudent to continue to maintain the infrastructure in this area of the harbor until it is
certain that replacement funds are in place.
It is recommended that items that could affect public safety be repaired as soon as
possible regardless of replacement schedule. This would include replacing bad decking or
hinges that may contribute to slips and falls or float instability. It is also recommended
that life rings, fire extinguishers, safety ladders, and the piped fire suppression system be
maintained regardless of replacement schedule.
28
1
CITY OF SEWARD
HARBOR ENTERPRISE FUND
SUMMARY OF TEN-YEAR CAPITAL IMPROVEMENT PROGRAM FUNDING
Priority
No. Status Useful 2010 2011 2012 2013 2014 5-Year Total 2015 2016 2017 2018 2019 5-Year Total 10-Year Total
Capital Outlays Life
CRITICAL NEEDS: Highly likely to tail within the next five years
Floats&Docks
1 Replace D Float Replace 2 $0 $0 $0 $2,363,500 $0 $2,363,500 $0 $0 $0 $0 $0 $0 $2,363,500
Maintenance
Harbor Dredging Maint $0 $0 $0 $255,000 $255,000 $0 $0 $0 $0 $0 $0 $255,000
Total Critical Needs: $0 $0_ $0 $2,363,500 $255,000 $2,618,500 $0 $0 $0 $0 $0 $0 $2,618,500
HIGH RISK: Highly likely to fail within the next 5-10 years.
Floats&Docks
2 Replace A,B,C,S Floats Replace 5 $0 $0 $0 $0 $0 $0 $6,100,000 $0 $0 $0 $0 $6,100,000 $6,100,000
3 Replace S Launch Ramp Replace 5 $0 $0 $0 $0 $0 $0 $1,000,000 $0 $0 $0 $0 $1,000,000 $1,000,000
Replace K&L floats Replace 7 $0 $0 $0 $0 $0 $0 $0 $2,250,000 $0 $0 $0 $2,250,000 $2,250,000
Replace N Launch Ramp Replace 8 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,000,000 $0 $1,000,000 $1,000,000
Equipment
Fish Waste Barges Replace 5 $0 $0 $0 $50,000 $20,000 $70,000 $0 $0 $0 $0 $0 $0 $70,000
Total High Risk Needs: $0 50 $0 $50,000 $20,000 $70,000 $7,100,000 $2,250,000 $0 $1,000,000 $0 $10,350,000 $10,420,000
MODERATE RISK:Continuously increasing cost to maintain and operate
Structures
Harbormaster Restrooms Maint 1 $0 $0 $100,000 $0 $0 $100,000 $0 $0 $0 $0 $0 $0 $100,000
Uplands
Trash Dumpsters(4) Replace $0 $0 $0 $40,000 $40,000 $0 $0 $0 $0 $0 $0 $40,000
Used Oil Stations Maint $20,000 $20,000 $20,000 $20,000 $60,000
Total Moderate Risk Needs: $0 $0 $120,000 $20,000 $60,000 $200,000 $0 $0 $0 $0 $0 $0 $200,000
Total Capital Outlay $0 $0 $120,000 $2,433,500 $335,000 $2,888,500 $7,100,000 $2,250,000 $0 $1,000,000 $0 $10,350,000 $13,238,500
Fully depreciated(book value)of harbor assets total approximately$4 million
i
i
s ..
CITY OF SEWARD
•
HARBOR ENTERPRISE FUND
SUMMARY OF TEN-YEAR CAPITAL IMPROVEMENT PROGRAM FUNDING
Priority No. Grants Status Useful Year 2010 Year 2011 Year 2012 Year 2013 Year 2014 5-Year Total Year 2015 Year 2016 Year 2017 Year 2018 Year 2019 5-Year Total 10-Year Total
Capital Outlays Life
Floats&Docks
T,U,V Floats(offZ Float) New $0 $0 $0 $0 $4,000,000 $0 $0 $0 $0 $0 $4,000,000
Power to X float New $0 $0 $200,000 $0 $0 $0 $0 $0 $0 $0 $200,000
NE Fish Cleaning Station New $775,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $775,000
N Harbor Sheetpile/Dock New $0 $0 $0 $0 $0 $9,000,000 $0 $0 $0 $0 $9,000,000
Uplands
$0 $0 $0 $0 so $0 $0 $0 $0 $0 $0
Pave TraveUft Runway New $15,000 $0 $0 $15,000 $0 $0 $0 $0 $0 $0 •$15,000
Boardwalk S Harbor Uplands New $200.000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $200,000
NE Harbor Parking Improve New $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Equipment
5-Ton Crane New $0 $100,000 $0 $0 $0 $0 $0 $0 $0 $0 $100,000
Total Capital Outlay $990,000 $100,000 $200,000 $15,000 $4,000,000 $9,000,000 12 $ $Q $Q $14,290,000
Assumes Receiving:
"CLAP Grant
-
CITY OF SEWARD
SMIC ENTERPRISE FUND
SUMMARY OF TEN-YEAR CAPITAL IMPROVEMENT PROGRAM FUNDING
Priority No. Status Useful Year 2010 Year 2011 Year 2012 Year 2013 Year 2014 5-Year Total Year 2015 Year 2016 Year 2017 Year 2018 Year 2019 5-Year Total 10-Year Total
Capital Outlays Life
Basin&Docks
North Dock&Ramp Repair $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Basin/Breakwater Extension New $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
TraveliftDock Repair $0 $0 $0 $0 $0 $0 $0 $o $0 $0 $0 $0 $0
East Dock Repair $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Uplands
$0
3 Grading&Drainage New $0 $0 $0 $0 $200,000 $200,000 $0 $0 $0 $0 $0 $0 $200,000
6 Paved Work Stations New $0 $0 $0 $0 $200,000 $200,000 $0 $0 $0 $0 $0 $0 $200,000
"1 Washdown Pad New $0 $750,000 $0 $0 $750,000 $0 $0 $0 $0 $0 $0 $750,000
2 Electrical Infrastructure Replace $0 $0 $100,000 $0 $100,000 $0 $0 $0 $0 $0 $0 $100,000
4 Fence New $0 $0 $0 $75,000 $75,000 $0 $0 $0 $0 $0 $0 $75,000
Equipment&Structures $0
250 ton Travelift Replace 10 $0 $0 $0 $0 $1,750,000 $1,750,000 $0 $0 $0 $0 $0 $0 $1,750,000
Used Oil Heater Repair 5 $0 $3,000 $3,000 $1,000 $7,000 Replace
Vessel Repair Enclosure New
5 Restrooms New $0 $0 $0 $0 $240,000 $240,000 $0 $0 $0 $0 $0 $0 $240,000
Maintenance
Basic,Dredging Maint $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Capital Outlay 52 $Q izaloo iinio.og $2,466,000 Salaam $0 $0 1.Q. so 10 $0 $3,322,000
*1 Assumes receiving
EVOS Grant Funding
Northern
Rate Setting for Port and Harbor Facilities
A White Paper by Mike Fisher, Northern Economics
A common need we see is the need to set appropriate rates for community-owned facilities like docks
and harbors. Throughout Alaska, communities are facing the need to replace or improve the infrastructure
that fuels their economic engine, yet they lack sufficient funds to fund the improvements internally. Rates
charged for use have been too low, the city or borough has generated insufficient revenues, and the
community doesn't have a replacement fund in place. When seeking out funding, the lending agencies
have a common message: they want to see sustainable facilities.What can communities do to address this
problem?
This white paper explores the topic of rate setting and discusses important aspects one needs to consider
when arriving at a rate to charge for the use of a facility. The topic is applicable to all kinds of facilities,
though the paper uses port and harbor facilities throughout as an example.
Why Set Appropriate Rates?
Why do communities need to set appropriate rates? The issue boils down to sustainability. In a financial
sense, port and harbor facilities need enough money coming in through various types of user fees (and
other funding sources) to ensure that the facilities are maintained in the long term.
Each group with a stake in port or harbor infrastructure has its own set of needs for the facility with
respect to sustainability. Most harbor facilities and many of the port facilities in Alaska are publicly owned.
The major stakeholder groups for these facilities are the entity who owns them, the different users of the
facilities, and the lending and granting agencies. The public is also a stakeholder, especially those who
reside in the community and who benefit from the facilities either as direct users or purchasers of goods
that are transported through the facilities.
Municipal port and harbor facilities provide a public access point to marine transportation and recreation.
In many communities in Alaska, maritime and riverine facilities and transportation modes rival other types
of transportation in terms of their importance, value, and accessibility. For a municipality, setting
appropriate rates means being able to cover costs and ensure that long-term operations, routine and
major maintenance, and eventual replacement (or decommissioning) are funded and able to occur as
planned. The municipality has an obligation to maximize the benefit of the public resources and assets it
owns, and to do so in a safe and ethical manner. Often, rates are set by balancing the costs of the facility
with the community-wide benefits created by the port and harbor infrastructure.
1380 H Street,Suite 210 Tel:907 2741.5600 f:-mail:maiks?norecon,com
Anchorages AK 99501 lax:907 2/4.5301 www.northemeconomics.com,
Rate Setting for Port and Harbor Facilities February 2011
Figure 1.Facility Stakeholders
Owner/
Municipality
'`)Nle 41',•1s Lenders
41
Users trtr r and
j t ` Granting
Agencies
Users of port and harbor facilities want to ensure that the facilities are safe and functional. Each type of
user, ranging from recreational to subsistence to commercial use, has its own needs, which means that
there may be many functions and services provided by the facilities. All users, however, want rate
structures to be understandable, rates to be fair and consistent, and allocation of costs to be equitable.
The equity issue is a topic considered in a later section of this paper.
Lenders and granting agencies have an interest in a facility's rates because they want to maximize the
value of their investments. These agencies want new or expanded facilities to operate without the need
for additional investment simply to cover operating shortfalls. In addition to seeing the facilities fully
funded and operating long-term, lending agencies also want to see benefits accrue to the community and
the region, such as job creation and retention, economic benefits and activity, and benefits to port and
harbor users. Lenders have always wanted to see their investments lead to meaningful benefits and
changes in a community and region. Their interest in these benefits has grown significantly in recent years,
though, specifically with regard to sustainability and the continued enjoyment and maintenance of these
benefits without the need for additional investment.
Approaches to Rate Setting
There are two general approaches to rate setting considered in this paper: market-based and economics-
based. Arguably, other approaches may exist and could be useful, but these two approaches tend to be
broad enough to cover most cases. As used here, market-based rates are those driven by what users will
pay and economics-based rates are driven by the costs associated with a facility.
Figure 2.Market-Based vs.Economics-Based Approaches
•Regional pricing
Market- comparisons
Based •Similar features and
offerings
Economics- ^•Facility cost information
Based •Quantitative tools
Ne cirernEconomics 7
• e
Rate Setting for Port and Harbor Facilities February 2011
Market-based rate setting usually comes into play when there are two or more facilities located somewhat
close to each other and with comparable features and offerings. Similarity can be assessed using many
factors. For example, for facilities that serve commercial fishing vessels, similarity can be gauged based on
proximity to the fishery resource,vessel capacity,vessel sizes supported, and supporting infrastructure and
services. For transportation-focused facilities, proximity to major shipping routes and cargo-generating
industries is important, as are water depths,tides, equipment, uplands storage space,other transportation
modes in the community, and approach channels. For recreational vessels and activities centered on the
land-water interface, land access modes (such as highways and railways) and distances from population
bases may be used to evaluate facilities'similarity.
It can be very tempting to set rates based on one's neighbors because (a) it's an easy approach (i.e., fast
and inexpensive), (b) it results in rates that users in the area are willing to pay, and (c) it results in a more
acceptable rate from a political standpoint. There is great danger, however, in using market-based rates
without using some kind of economics-based approach to supplement and support the decision. Suppose
Facility A wants to use rates currently in place at Facility B. Using the approach will work fine if Facility A
and Facility B have identical costs, identical uses, and an identical user mix. This is rarely, if ever,the case,
however,which means that Facility B's rates won't give Facility A the revenues it needs, or Facility B's per-
[gallon, ton, container, etc.] rate won't be sufficient given the [gallons, tons, containers, etc.) handled at
Facility A. In addition to the need for a perfectly-matched facility, using market-based rates also assumes
that the owners of Facility B set appropriate rates and have followed through with their plan for necessary
rate increases over time.
The challenges and potential problems of using market-based rates leads to the use of economics-based
rates. As considered here,this category includes a broad range of tools and techniques used to create rate
structures based on cost information and activity levels specific to a facility. Different types of cost
information could include, for example, facility replacement costs, operating expenses, inflation
adjustments, construction cost increases over time, and a facility's historical usage and experience. Ideally,
all of this factors will be considered, but rates based on even a subset of these factors will be more
appropriate than purely arbitrary or market-based rates.
"Economics-based rates" is a very broad term and can apply to many types of approaches to rate-setting.
A technique called life cycle cost analysis is a good example of an economics-based tool. Life cycle cost
analysis, as its name implies, evaluates the cost of a facility over its entire life, from initial concept and
design to operations to replacement and decommissioning.
Life cycle cost analysis is often done as part of an alternatives analysis; if everything else remains the same
on the revenue side (i.e., the facilities provide the same functional capacity), one can look at the life cycle
cost of each alternative that meets one's needs and choose the least-costly alternative.
When thinking about what costs should be included in a life cycle cost analysis, the answer is just about
everything. Life cycle costs include:
• Startup costs: design, permitting, etc.
• Construction costs: mobilization/demobilization, labor and materials,etc.
• Operations costs: labor costs, supplies, equipment costs, utilities,etc.
• Maintenance costs: routine maintenance, repairs, major maintenance,etc.
• Additional capital costs: planned upgrades, replacements, etc.
• Decommissioning costs: mobilization/demobilization, labor, disposal costs,salvage value, etc.
Northern Economics 3
Rate Setting for Port and Harbor Facilities February 2011
Figure 3.Life Cycle Cost Categories
~'ham`t...✓fes/�1/
Decommissioning
As*
wLife s, `�.,
Cycle
• 1ff Costs
°tEun�f
x
Maintenance
When the timing of these costs is considered, a picture emerges of how a facility's costs are distributed
over its life. Depending on choices made at each stage of the facility's life, the timing of costs can valy
considerably, as can the allocation between startup and construction costs, operations and maintenance
costs, and replacement and decommissioning costs. The choice of higher quality (and cost) upfront often
leads to lower costs over time, reusability of older materials during decommissioning, and other savings.
The opposite is often true as well. Evaluating these tradeoffs is in the realm of value engineering and
optimization.
After determining the timing and amount of all costs, life cycle cost analysis uses the traditional net
present value technique to come up with the present value of future cash flows. Generally, all of the cash
flows are negative, but there may be positive, off-setting cash flows, such as salvage values. Comparing
alternatives on a relative basis will also result in both positive and negative cash flows relative to the base
amount.
Once calculated, the net present value represents the cost today of all of the anticipate facility expenses
into the future. The net present value may also be converted to an annualized cost, which represents a
series of identical payments over time, similar to a mortgage payment. This annualized cost provides a
single, smooth, annual amount that can be used to cover all costs over time. When divided by an annual
measurement of use, such as tons of cargo or linear feet of moorage space, one arrives at the rate that
must be charged to cover costs at that rate of use.
While life cycle cost analysis is only one of many economics-based techniques for rate setting, it serves as
a good example of a tool that can be used when a great deal of information is available at the facility. A
demonstration of the technique is shown in a later section. Many other approaches exist under the
"economics-based" umbrella and can be applied to different extents based on the amount of information
available to make a rate setting decision.
Norriw.enEconomics 4
Rate Setting for Port and Harbor Facilities February 2011
We have looked at a large list of costs that could be covered by rates. The next section looks at these
expenses more closely and suggests which costs need to be included in the rate.
What Costs to Cover with Base Rates
Ideally, port and harbor facilities should cover their full costs with their user fees and perhaps some
revenues from other sources that are generated from, but not directly paid to, the facility. Since this is not
always the case,we'll look at different levels of funding and what they include.
In many Alaskan communities, facility owners have difficulty charging sufficient rates to cover costs. This is
due to a variety of issues, but in many cases either a comprehensive rate study hasn't been done (often
with rates set by the market) or the rates were set years (or even decades) ago and not updated since then
to reflect actual costs. While we always recommend that rates fully cover all of a facility's costs, we
recognize that it may be a multi-year process to get to that point and often provide guidance on the steps
needed to get to a fully-funded operation.
Once one has gathered all of the cost information for a facility,aided by the list of categories on the prior
page, it is helpful to organize it into capital and operating costs. Generally, everything presented in the list
is a capital cost, except for operations costs and routine maintenance costs. With costs grouped into
capital and operating costs (or the annualized equivalent of each based on a life cycle cost analysis
approach), the discussion can now turn to coverage of those costs.
Generally, funding may occur at three levels: the full cost (capital and operating costs), operating costs
alone (operations and routine maintenance costs), or operating costs plus some portion of the capital
costs. Ideally, rates will cover the facility's full cost, which means the enterprise should he able to operate
indefinitely, as long as the rates keep up with changes in the cost structure and level of use.
At a minimum, operating costs (often abbreviated as O&M) need to be covered. There's an old saying
about losing money on every transaction, but making it up on volume. Unfortunately, the strategy rarely
works in the long-term. Though one might consider other factors, such as the facility providing the
economic lifeblood of the community, if rates don't cover O&M, there's a strong argument for either
drastic change or a shutdown of the facility. A drastic change is almost always preferable and, with the
help of a proper rate study, the facility owner can generate support for the plan much more easily once
the stakeholders understand the need for change and rationale behind the new plan.
Figure 4.Funding Levels to Cover with the Base Rate
Full Cost
• (Capital and
Operations)
Operations
Plus
Operations
NorthernEconomics 5
I
Rate Setting for Port and Harbor Facilities February 2011
If users can afford to pay rates in excess of operating costs but not enough to cover the full cost, the goal
should be to cover as much of that gap as possible. When it comes time to replace or expand the facility,
having some funds available means the community or enterprise fund will be able to provide a local
match and down payment, reducing the amount of money that will need to be borrowed. A facility
funded with 50 percent debt is better off than a facility funded fully with debt. Without any equity, the
cost of the facility increases due to the increased interest expense,the facility's financial situation becomes
more sensitive to changes in the level of use, and the risk of defaulting on debt payments increased.
No discussion about covering costs would be complete without a word about other local funding sources.
Port and harbor facilities are undoubtedly economic drivers for many communities. The economic activity
created by port and harbor facilities shouldn't be ignored as a source of funding or a benefit to sell to
potential lenders and granting agencies. In communities where commercial fishing is a big industry, for
example, the municipality's general fund probably receives shared fish tax revenues from the state. While
these are general fund revenues, it is clear what drives them. Without port and harbor facilities, there
wouldn't be as much commercial fishing activity, because the land-water interface wouldn't be there to
connect product with processors and distribution channels. Within reason, and with proper
documentation of the decision, it is perfectly acceptable to make transfers from the general fund to
support the maritime facilities since those facilities have generated the revenues. What a community
would not want to do is make transfers to subsidize a port or harbor facility without a rational basis for
doing so. This simply postpones having to deal with facility revenue shortfalls and, perhaps more seriously,
raises a red flag to potential funding and financing agencies.
Governmental Accounting Standards Board's Statement 34 requires that municipalities account for
depreciation expense of their capital assets. This means that port and harbor assets need to be
depreciated over time in the community's or enterprise fund's financial statements. While depreciation is
a non-cash expense, it shouldn't be ignored. To the extent possible, think of that depreciation expense as
a target for funding of a facility replacement fund. By depositing that money in a replacement fund and
making it available for the next major capital expense, the facility will be much better off, both in terms of
its condition and the attractiveness of the enterprise to potential lenders and granting agencies.
There are many other details to consider, and this discussion has only begun to scratch the surface. If this
is the first time you've worked with this kind of information, it's advisable to talk with your finance
director so you can gain an understanding of how these costs are handled.
Challenges to the Rate-Setting Process
Once a rate plan has been prepared, the next step may be the most difficult: gaining acceptance and
adopting the rates. Cost allocation and equity issues often play a major part in these difficulties.
Cost allocation is the process of allocating capital and operating costs to different user groups. This can be
straightforward with dedicated facilities and singular uses, or it can be much more complex when dealing
with multiple types of users and multiple activities at a common facility. Allocation decisions must be
guided by an understanding of what drives costs. Factors driving costs might include:
• Frequency of use
• Total annual duration of use
• Total annual tons carried across or gallons carried through the facility
• Wear and tear based on vessel and equipment sizes
• Other quantifiable and measurable factors
North,s,rn Economics 6
s
Rate Setting for Port and Harbor Facilities February 2011
Some operating costs, such as staff time, can be more challenging and may be driven by more qualitative
factors. The most important part of the process is to use a consistent and transparent process so that it is
clear how the results came about and it is easy to evaluate the effect of changing that process.
Transparency is especially helpful when presenting a new rate structure to users or negotiating rates for a
preferential use agreement.
A common concern when proposing rate changes, especially when long-term maintenance and
replacement costs are involved, is that of equity. Users often ask why they should have to pay for facilities
that are going to serve future users. There isn't a simple and satisfying answer to this question, though
there are two ways to view the issue that may be effective in communicating the need to adjust rates.
First, it is important to recognize that failing to set appropriate rates places a burden on future users that
current users didn't have to face. Heavily subsidized rates are attractive to most users. Few users,
however, would choose to group together, build a brand new facility fully funded by their own money,
maintain the facility over time with their own money,and, at the end of the facility's life (30 to 50 years),
remove and dispose of all of the improvements (with their own money) and move on. In essence, this is
happens without taking a long-term view in rate setting, except that users don't pay all of these costs; the
government entity does.
Second, though current users often face significantly higher rates as a result of adopting a long-term
approach than they do under a heavily subsidized situation, the new rates are no higher than they would
have been had the long-term approach been followed all along. Current users aren't being asked to pay
for future users'costs, but for their own, current costs.
From either angle, the issue is about if, and by how much, the government entity is willing to subsidize
rates.
Another common concern from industry members and residents alike is that rate changes have to be
considered in the context of the costs of operating in the region. Purchasers of goods brought in to a
community ultimately have to pay the cost of bring those goods to their doorstep,which means that these
operating costs ultimately come out of their pocket. (If not, then that service may go away, which also
means the revenues generated by the activity go away.) For communities off of the road system, there are
fewer options for transporting goods than there are in places on the road system. On the road system or
with rail access, ports can optimize their user mixes and coordinate with other ports to reduce the overall
cost of each type of good in the region. There isn't a simple answer to this issue, and relative costs fall
away when there aren't any other options. The effect of rates simply must be considered in the overall
cost of living and operating in the region.
Though thinking about cost allocation and equity issues may raise more questions than it answers, it's
important to anticipate these issues ahead of time, rather than after a rate structure has been proposed.
Life Cycle Costing Example
To illustrate the rate setting process, suppose a port facility handles 30,000 tons of cargo annually. We
would like to set a wharfage rate to cover the full cost of the facility, based on that level of activity.
We anticipate that operating cost will be $113,500 per year, consisting of $100,000 of employee cost
(including wages, benefits, and other costs) and several smaller expense items. We will assume constant
year dollars, which means the rate will need to be adjusted over time to account for inflation. On the
capital side,we anticipate paying for a $5 million improvement in 2016 and a $1 million improvement in
2020. Again, each of these amounts is in year 2011 dollars.
'4orthernEconomics 7
l I a
Rate Setting for Port and Harbor Facilities February 2011
Table 1 summarizes the projected costs, in thousands of dollars, for 2011 through 2020. Operations and
maintenance costs will continue for a total of 30 years, at$113,500 per year in 2011 dollars.
Table 1.Capital and Operating Costs for Dock Facility,Thousands of Dollars,2011-2020
Year
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Capital Costs
Dock Facility 0.0 0.0 0.0 0.0 0.0 5,000.0 0.0 0.0 0.0 1,000.0
Operations and Maintenance Costs
Employee costs 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0
Office supplies 0.5 0.5 0.5 0.5 0.5 0.5 0.5 0.5 0.5 0.5
Services 5.0 5.0 5.0 5.0 5.0 5.0 5.0 5.0 5.0 5.0
Training 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0
Equipment 2.0 2.0 2.0 2.0 2.0 2.0 2.0 2.0 2.0 2.0
Utilities 5.0 5.0 5.0 5.0 5.0 5.0 5.0 5.0 5.0 5.0
Total Costs 113.5 113.5 113.5 113.5 113.5 5,113.5 113.5 113.5 113.5 1,113.5
The Office of Management and Budget publishes a discount rate each year that is suitable for public
infrastructure projects. For 2011, the rate is 4.5 percent. The discount rate is used to discount future cash
flows to the present. The net present value of this facility's series of costs is just over$6.6 million. The next
step is to find an annualized equivalent cost for the next 30 years. This is similar to a mortgage payment
calculation using a 4.5 percent rate and a total payment of $6.6 million after the final payment. In this
case,the annualized cost is$108,962.
The final step is to find the amount to charge per ton in order to cover the annualized amount. Dividing
$108,962 by 30,000 tons gives us a cost of $3.63 per ton. This rate, along with annual inflation
adjustments,should cover the cost of the port facility over its life.
In the event the level of use were to change, an adjustment could be made to the rate. With greater use,
the cost per unit of use would go down. For example, if cargo operations increased to 35,000 tons per
year, the annualized cost would decrease to $3.11 per ton. Likewise, if cargo operations dropped to
25,000 tons, the annualized cost would increase to $4.36 per ton. Because of the rate's sensitivity to the
amount of cargo handled, as well as to changes in capital and operating costs, it is beneficial to monitor
costs and activity levels and periodically repeat the live cycle cost analysis.
Conclusion
This white paper has examined the process of rate setting with a focus on port and harbor facilities.We've
talked about the importance of setting appropriate rates as well as the tools used to set them, both
economic and political. The intent of the paper was to look at some of the specifics of this common need,
share a framework for doing a rate study,and present a useful tool for facility owners and operators.
Northern Economics has over 25 years of experience in Alaska and beyond-providing clarity for our
clients through impartial analysis. We seek challenging work in which we use creativity, knowledge,
and experience to solve complex issues. Simply put, our expert staff knows where to look and how to
weigh multiple variables to interpret data without bias.
For more information about rate setting and how Northern Economics can assist you with rate setting
for your facility, please visit us at www.NorthernEconomics.com, call us at(907)274-5600, or stop by
our offices at 880 H Street, Suite 210,Anchorage,AK 99501.
This white paper was published at www.HarborModel.com in February 2011.
NortheenEconomics -- 8
Seward Whittier Homer Kodiak Valdez Cordova Juneau Sitka Petersberg
DOUGLAS,HARRIS&
Moorage AURORA STATTER&OEHARTS
Annual / Foot $43.85 $64.20 $35.22 Variable $27.83 $30.75 $44.46 $74.10 $22.80 34.08
Tenant *Additional Fees" CRR$60-$240 $50.00
Vessels 17 $745.45 $1,091.40 $648.74 $476.00 $484.00 $522.75 $755.82 $1,259.70 $387.60 $579.36
23 $1,008.55 $1,476.60 $860.06 $667.00 $484.00 $707.25 $1,022.58 $1,704.30 $524.40 $783.84
32 $1,403.20 $2,054.40 $1,177.04 $928.00 $890.56 $984.00 $1,422.72 $2,371.20 $729.60 $1,090.56
40 $1,754.00 $2,568.00 $1,458.80 $1,160.00 $968.00 $1,230.00 $1,778.40 $2,964.00 $912.00 $1,363.20
50 $2,192.50 $3,210.00 $1,811.00 $2,000.00 $1,210.00 $1,537.50 $2,223.00 $3,705.00 $1,140.00 $1,704.00
75 $3,288.78 $4,815.00 $2,691.50 $4,500.00 $2,087.25 $2,306.25 $3,334.50 $5,557.50 $1,710.00 $2,556.00
90 $3,946.50 $5,778.00 $3,219.80 $6,300.00 $2,504.70 $2,767.50 $4,001.40 $6,669.00 $2,052.00 $3,067.20
100 $4,385.00 $6,420.00 $3,572.00 $7,000.00 $2,783.00 $3,075.00 $4,446.00 $7,410.00 $2,280.00 $3,408.00
Semi-Annual/foot $26.31 N/A 23.60 N/A N/A N/A N/A N/A N/A N/A
*Additional Fees" CRR Fee 33.50
Quarterly/foot $19.73 N/A N/A N/A N/A N/A N/A N/A N/A N/A
*Additional fees* CRR Fee
Monthly/foot $7.89 N/A 5.99 N/A $8.75 $10.75 $3.90 $6.50 6.00 $4.00
*Additional Fees* CRR Fee 8.50
Daily I foot $0.58 N/A 1.06 1/60 of $0.70 $0.80 $0.49 $0.49 Variable $0.40
"Additional fees* CRR Fee 1.50 annual rate
CRR Fee Daily moorage
based on shall stop Daily rate is Double if
length of accruing when .95 if billed billed
vessel an amount equal
to 100%of the
annual moorage
I has been
reached
Seward Whittier Homer Kodiak Valdez Cordova Juneau Sitka Petersberg
S,HARRIS 8
Moorage AURORA
STATTER BDEHARTS
Annual / Foot $43.85 N/A $35.22 Variable $27.83 $30.75 $44.46 $74.10 $22.80 $ 48.00
Transient *Additional Fees* CRR Fee $50.00
Vessels 17 $745.45 $648.74 $476.00 $473.11 $522.75 $755.82 $1,259.70 $387.60 $816.00
23 $1,008.55 $860.06 $667.00 $640.09 $707.25 $1,022.58 $1,704.30 $524.40 $1,104.00
32 $1,403.20 $1,177.04 $928.00 $890.56 $984.00 $1,422.72 $2,371.20 $729.60 $1,536.00
40 $1,754.00 $1,458.80 $1,160.00 $1,113.20 $1,230.00 $1,778.40 $2,964.00 $912.00 $1,920.00
50 $2,192.50 $1,811.00 $2,000.00 $1,391.50 $1,537.50 $2,223.00 $3,705.00 $1,140.00 $2,400.00
75 $3,288.78 $2,691.50 $4,500.00 $2,087.25 $2,306.25 $3,334.50 $5,557.50 $1,710.00 $3,600.00
90 $3,946.50 $3,219.80 $6,300.00 $2,504.70 $2,767.50 $4,001.40 $6,669.00 $2,052.00 $4,320.00
100 $4,385.00 $3,572.00 $7,000.00 $2,783.00 $3,075.00 $4,446.00 $7,410.00 $2,280.00 $4,800.00
Semi-Annual/foot $26.31 N/A 23.60 N/A N/A N/A N/A N/A N/A N/A
*Additional Fees* CRR Fee 33.50
Quarterly/foot $19.73 N/A N/A N/A N/A N/A N/A N/A N/A N/A
*Additional fees* CRR Fee
Monthly/foot $7.89 $21.40 5.99 N/A $8.75 $10.75 $3.90 $6.50 6.00 $4.00
*Additional fees* CRR Fee 8.50
Daily/foot $0.58 $1.10 1.06 1/60 of $0.70 $0.80 $0.49 $0.49 Variable $0.40
*Additional fees* CRR Fee 1.50 annual rate transient
based on Daily moorage rate X 1.5 if
length of shall stop not paid in Daily rate is Double if
vessel accruing when advance .95 if billed billed
an amount equal
to 100%of the
annual moorage
has been
reached
Port & Harbor Tariff Rate Review for 2012/2013
1.) Continue to Link Moorage/Dockage increases to CPI
2012 equals the average CPI for 2005-2009 (3.1+3.2+2.2+4.6+1.2) = 14.3/5 =2.86%
2013 equals the average CPI for 2006-2010 (3.2+2.2+4.6+1.2+1.8) = 13/5 =2.6%
Subsection 205 (b)
2.) Eliminate Quarterly Rates
Moorage Rates available for Annual, Semi-Annual, Monthly or Daily timeframes.
Subsection 205 (d) (4)
3.) Establish a Rate Structure to Benefit Slip-holders (Tenants) by Increasing the
Daily Rate (Which Tenants Do Not Pay)
Daily Rates. With the exception of vessel owner/operators who have paid an annual,
semi-annual, or monthly fee in advance, all temporary or transient moorage charges shall
be calculated on the daily rate. The daily rate shall be( ) per lineal foot of overall
length.
Subsection 205 (c)
All permanently assigned berths are assigned on a calendar-year basis. Prepayment of a
full year's moorage is due on or before December 31 of the preceding year. A vessel
owner may elect to prepay the annual moorage fee at the semi-annual rate, with the first
installment due on or before December 31St of the preceding year, and the second
installment due on or before June 30th of the current year.
Subsection 205 (d) (6)
4.) Eliminate Miscellaneous Electric Charges for Reconnection
Eliminate reconnection to approved existing meter installation during regular business
hours and/or outside regular business hours.
Subsection 225 (e) (2) & (3)
5.) Restructure Harbor Electric Fees
Establish a per kilowatt hour charge that would include the fuel adjustment factor and
revenue formerly generated by connect fees, so these are not additional fees that must be
charged. All vessels (except Transient staying 15 days or less) will pay a per kilowatt
hour charge as established in the tariff and a monthly customer charge.
Subsection 225 (a)(2)(i)
6.) SMIC Electric Charges
$15.75 Customer Charge does not cover fees charged by Electric Department. This fee
should be increased to $35.00
Subsection 225 (a) (3) (iii)
SEWARD HARBOR
iw
Y ; IJr
..�...+.._ _ ,.:...-:.-. .. \1- orf`.-1�
.. 2,,
r
..., i.00.9001R'
W
s 7:,_"
r.r .ic -
n
•, _ le*_ a we , . .:• ,. - ---- .. .-
• a
•
�` +.,, --.fin• 4' _
k
-. ,.. 74
�
-,6. ,,,:a,,,, 1 hAzt
-._4
4
ti
- ., .• 4. ea < S . ` i.ey!'+.i i.y
y
.
6,...:,..e.. -.-seiment:••:•—▪ •sea''
Yellow-Z, X, R, and NE Launch Ramp & Fish Cleaning Station - M, N, 0, P &Q Dock Fish Cleaning Station
Biu-L, K, J, H, F, E Floats &J Dock Fish Cleaning Station D, C, B, A, S & S Launch Ramp, B Fish Clean
T, I &TraveLift Dock
CITY OF SEWARD
HARBOR ENTERPRISE FUND
SUMMARY OF TEN-YEAR CAPITAL IMPROVEMENT PROGRAM FUNDING
Priority
No. Status Useful 2010 2011 2012 2013 2014 5-Year Total 2015 2016 2017 2018 2019 5-Year Total 10-Year Total
Capital Outlays Life
CRITICAL NEEDS: Highly likely to tail within the next five years
Floats&Docks
1 Replace D Float Replace 2 $0 $0 $0 $2,363,500 $0 $2,363,500 $0 $0 $0 $0 $0 $0 $2,363,500
Maintenance
Harbor Dredging Maint $0 $0 $0 $255,000 $255,000 $0 $0 $0 $0 $0 $0 $255,000
Total Critical Needs $0 $0 $0 $2,363,500 $255,000 $2,618,500 $0 $0 $0 $0 $0 $0 $2,618,500
HIGH RISK: Highly likely to tail within the next 5-10 years.
Floats&Docks
2 Replace A,B,C,S Floats Replace 5 $0 $0 $0 $0 $0 $0 $6,100,000 $0 $0 $0 $0 $6,100,000 $6,100,000
3 Replace S Launch Ramp Replace 5 $0 $0 $0 $0 $0 $0 $1,000,000 $0 $0 $0 $0 $1,000,000 $1,000,000
Replace K&L floats Replace 7 $0 $0 $0 $0 $0 $0 $0 $2,250,000 $0 $0 $0 $2,250,000 $2,250,000
Replace N Launch Ramp Replace 8 $0 $0 $0 $0 $0 50 $0 $0 $0 $1,000,000 $0 $1,000,000 $1,000,000
Equipment
Fish Waste Barges Replace 5 $0 $0 $0 $50,000 $20,000 $70,000 $0 $0 $0 $0 $0 $0 $70,000
Total High Risk Needs: $0 $0 $0 $50,000 $20,000 $70,000 $7,100,000 $2,250,000 $0 $1,000,000 $0 $10,350,000 $10,420,000
MODERATE RISK:Continuously increasing cost to maintain anti operate
Structures
Harbormaster Restrooms Maint 1 $0 $0 $100,000 $0 $0 $100,000 $0 $0 $0 $0 $0 $0 $100,000
Uplands
Trash Dumpsters(4) Replace $0 $0 $0 $40,000 $40,000 $0 $0 $0 $0 $0 $0 .$40,000
Used Oil Stations Maint $20,000 $20,000 $20,000 $20,000 $60,000
Total Moderate Risk Needs: $0 $0 $120,000 $20,000 $60,000 $200,000 $0 $0 $0 $0 $0 $0 $200,000
Total Capital Outlay $0 $0 $120,000 $2,433,500 $335,000 $2,888,500 $7,100,000 $2,250,000 $0 $1,000,000 $0 $10,350,000 $13,238,500
Fully depredated(book value)of harbor assets total approximately$4 million
—0%.
L
M
I
•
CITY OF SEWARD
HARBOR ENTERPRISE FUND
SUMMARY OF TEN-YEAR CAPITAL IMPROVEMENT PROGRAM FUNDING
Priority No. Grants Status Useful Year 2010 Year 2011 Year 2012 Year 2013 Year 2014 5-Year Total Year 2015 Year 2016 Year 2017 Year 2018 Year 2019 5-Year Total 10-Year Total
Capital Outlays Life
Floats&Docks
T,U,V Floats(off Z Float) New $0 $0 $0 $0 $4,000,000 $0 $0 $0 $0 $0 $4,000,000
Power to Xfloat New $0 $0 $200,000 $0 $0 $0 $0 $0 $0 $0 $200,000
NE Fish Cleaning Station New $775,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $775,000
N Harbor Sheetpile/Dock New $0 $0 $0 $0 $0$9,000,000 $0 $0 $0 $0 $9,000,000
Uplands
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Pave TraveLift Runway New $15,000 $0 $0 $15,000 $0 $0 $0 $0 $0 $0 $15,000
Boardwalk S Harbor Uplands New $200,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $200,000
NE Harbor Parking Improve New $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Equipment
5-Ton Crane New $0 $100,000 $0 $0 $0 $0 $0 $0 $0 $0 $100,000
Total Capital Outlay $990,000 $100,000 $200,000 $15,000 $4,000,000 $9,000,000 IQ 19_ $0 $.2 $14,290,000
Assumes Receiving:
**CIAP Grant
1
(1I
N
CITY OF SEWARD
SMIC ENTERPRISE FUND
SUMMARY OF TEN-YEAR CAPITAL IMPROVEMENT PROGRAM FUNDING
Priority No. Status Useful Year 2010 Year 2011 Year 2012 Year 2013 Year 2014 5-Year Total Year 2015 Year 2016 Year 2017 Year 2018 Year 2019 5-Year Total 10-Year Total
Capital Outlays Life
Basin&Docks
.North Dock&Ramp Repair $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Basin/Breakwater Extension New $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
TraveliftDocl< Repair
East Dock Repair �� $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Uplands
3 Grading&Drainage New $0
$0 $0 $0 $0 $200,000 $200,000 $0 $0 $0 $0 $0 $0 $200,000
6 Paved Work Stations New $0 $0 $0 $0 $200,000 $200,000 $0 $0 $0 $0 $0 $0 $200,000
"1 Washdown Pad New $0 $750,000 $0 $0 $750,000 $0 $0 $0 $0 $0 $0 $750,000
2 Electrical Infrastructure Replace $0 $0 $100,000 $0 $100,000 $0 $0 $0 $0 $0 $0 $100,000
4 Fence New $0 $0 $0
$75,000 $75,000 $0 $0 $0 $0 $0 $0 $75,000
Equipment&Structures
$0
250 ton Travelift Replace 10 $0 $0 $0 $0 $1,750,000 $1,750,000 $0 $0 $0 $0 $0 $0 $1,750,000
Used Oil Heater Repair 5 $0 $3,000 $3,000 $1,000 $7,000 Replace
Vessel Repair Enclosure New
5 Restrooms New $0 $0 $0 $0 $240,000 $240,000 $0 $0 $0 $0 $0 $0 $240,000
Maintenance
Basin Dredging Maint $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Capital Outlay SQ $0 $753,000 $103,000 $2,466,000 $3,322,000 $0 $0 $0 $0 1.0 $0 $3,322,000
`1 Assumes receiving
EVOS Grant Funding
4
t
Seward Whittier Homer Kodiak Valdez Cordova Juneau Sitka Petersberg
Mooracie DOUGLAS,HARRIS&
AURORA STATTER&DEHARTS
Annual /Foot $43.85 N/A $35.22 Variable $27.83 $30.75 $44.46 $74.10 $22.80 $ 48.00
Transient Additional Fees* CRR Fee $50.00
Vessels 17 $745.45 $648.74 $476.00 $473.11 $522.75 $755.82 $1,259.70 $387.60 $816.00
23 $1,008.55 $860.06 $667.00 $640.09 $707.25 $1,022.58 $1,704.30 $524.40 $1,104.00
32 $1,403.20 $1,177.04 $928.00 $890.56 $984.00 $1,422.72 $2,371.20 $729.60 $1,536.00
40 $1,754.00 $1,458.80 $1,160.00 $1,113.20 $1,230.00 $1,778.40 $2,964.00 $912.00 $1,920.00
50 $2,192.50 $1,811.00 $2,000.00 $1,391.50 $1,537.50 $2,223.00 $3,705.00 $1,140.00 $2,400.00
75 $3,288.78 $2,691.50 $4,500.00 $2,087.25 $2,306.25 $3,334.50 $5,557.50 $1,710.00 $3,600.00
90 $3,946.50 $3,219.80 $6,300.00 $2,504.70 $2,767.50 $4,001.40 $6,669.00 $2,052.00 $4,320.00
100 $4,385.00 $3,572.00 $7,000.00 $2,783.00 $3,075.00 $4,446.00 $7,410.00 $2,280.00 $4,800.00
Semi-Annual/foot $26.31 N/A 23.60 N/A N/A N/A N/A N/A N/A N/A
*Additional Fees* CRR Fee 33.50
Quarterly/foot $19.73 N/A N/A N/A N/A N/A N/A N/A N/A N/A
*Additional fees* CRR Fee
Monthly/foot $7.89 $21.40 5.99 N/A $8.75 $10.75 $3.90 $6.50 6.00 $4.00
*Additional fees* CRR Fee 8.50
Daily/foot $0.58 $1.10 1.06 1/60 of $0.70 $0.80 $0.49 $0.49 Variable
$0.40
*Additional fees* CRR Fee 1.50 annual rate transient
based on Daily moorage rate X 1.5 if
length of shall stop not paid in Daily rate is Double if
vessel accruing when
an amount equal advance .95 if billed billed
to 100%of the
annual moorage
has been
reached
rAs Si g) EM''r S4ituasis.0
ss�Ls "
1
Seward Whittier Homer Kodiak Valdez Cordova Juneau Sitka Petersberg
Moorane
DOUGLAS,HARRIS&
Annual I Foot AURORA STATTER&DEHARTS
$43.85 $64.20 $35.22 Variable $27.83 $30.75 $44.46 $74.10 $22.80 34.08
Tenant Additional Fees* CRR$60-$240 $50.00
Vessels 17 $745.45 $1,091.40 $648.74 $476.00 $484.00 $522.75 $755.82 $1,259.70 $387.60 $579.36
23 $1,008.55 $1,476.60 $860.06 $667.00 $484.00 $707.25 $1,022.58 $1,704.30 $524.40 $783.84
32 $1,403.20 $2,054.40 $1,177.04 $928.00 $890.56 $984.00 $1,422.72 $2,371.20 $729.60 $1,090.56
40 $1,754.00 $2,568.00 $1,458.80 $1,160.00 $968.00 $1,230.00 $1,778.40 $2,964.00 $912.00 $1,363.20
50 $2,192.50 $3,210.00 $1,811.00 $2,000.00 $1,210.00 $1,537.50 $2,223.00 $3,705.00 $1,140.00 $1,704.00
75 $3,288.78 $4,815.00 $2,691.50 $4,500.00 $2,087.25 $2,306.25 $3,334.50 $5,557.50 $1,710.00 $2,556.00
90 $3,946.50 $5,778.00 $3,219.80 $6,300.00 $2,504.70 $2,767.50 $4,001.40 $6,669.00 $2,052.00 $3,067.20
100 $4,385.00 $6,420.00 $3,572.00 $7,000.00 $2,783.00 $3,075.00 $4,446.00 $7,410.00 $2,280.00 $3,408.00
Semi-Annual/foot $26.31 N/A 23.60 N/A N/A N/A N/A N/A N/A N/A
*Additional Fees* CRR Fee 33.50
Quarterly/foot $19.73 N/A N/A N/A N/A - N/A N/A N/A N/A N/A
*Additional fees* CRR Fee
Monthly/foot $7.89 N/A 5.99 N/A $8.75 $10.75 $3.90 $6.50 6.00 $4.00
*Additional Fees* CRR Fee 8.50
Daily/foot $0.58 N/A 1.06 1/60 of $0.70 $0.80 $0.49 $0.49 Variable $0.40
*Additional fees* CRR Fee 1.50 ,nnual rlf
CRR Fee Daily moorage
based on shall stop Daily rate is Double if
length of accruing when .95 if billed billed
vessel an amount equal
to 100%of the
annual moorage
has been
reached
11
SCO
LIMPS " SuP - HDEcrr 11.46 giThrir le
fl
Cl'.
Administration Recommendations: Harbor Enterprise Fund
❑ Continue to link Tenant/Slip-Holder moorage rates to the CPI
■ 2012 =2.86%
• 2013 =2.6%
❑ Increase the Transient/Guest Moorage Rates by 10%
• Would generate$40,000-$50,000 additional revenue
• Rates would be less than Homer, Whittier,Kodiak,Valdez, Cordova
• 2012 =$0.66 per foot per day
■ 2013 =$0.68 per foot per day
❑ Continue CRR Fee
❑ Continue to Transfer Fish Tax to Harbor Enterprise Fund
❑ Recommend Formal Rate Study and 10 year funding strategy based on capital
improvement plan
Recommendations for Changes to the Port& Harbor Tariff:
Eliminate Quarterly Rates
Moorage Rates available for Annual, Semi-Annual,Monthly or Daily timeframes.
Subsection 205 (d) (4)
Eliminate Miscellaneous Electric Charges for Reconnection
Eliminate reconnection to approved existing meter installation during regular business
hours and/or outside regular business hours.
Subsection 225 (e) (2) & (3)
Restructure Harbor Electric Fees
Establish a per kilowatt hour charge that would include the fuel adjustment factor and
revenue formerly generated by connect fees, so these are not additional fees that must be
charged. All vessels (except Transient staying 15 days or less)will pay a per kilowatt
hour charge as established in the tariff and a monthly customer charge.
Subsection 225 (a)(2)(i)
SMIC Electric Charges
$15.75 Customer Charge does not cover fees charged by Electric Department. This fee
should be increased to $35.00
Subsection 225 (a) (3) (iii)