Mayor Chris Cerino had some surprising news at Monday’s town council meeting: he submitted a request to the Governor’s office for the town marina rebuilding efforts to budgeted by the State as a line-item budget issue.
Estimates for the costs of dredging, adding to the docks, bulkheads, protect the area against flooding, and reconstructing the marina grounds according to plans gathered from several public meetings, amount to approximately $4 million. The comprehensive package of estimates will at least put the Chestertown Marina project on the State’s radar. It is the council’s hope that at least a dialogue will be opened at a state level if funding is not a possibility at this time.
This four minute video is of Mayor Cerino describing the request process.
Michael Waal says
REVISED LETTER TO THE EDITOR CHESTERTOWN SPY
November 12, 2014
So why would an acutely intelligent business man, around three years ago, want to unload three water front parcels on the Chester River for which he paid $2.4 million for just $2 million. Especially with the potential for a 92-slip marina. Why? Because the boating industry was and is taking on water, with no search and rescue vessel in sight.
The boating industry over the past years since the recession has suffered from the same ailment as a hull-full-of-barnacles, it can’t attain enough speed to get up on plane. It is an industry directly link to discretionary spending, of which there isn’t much anymore. New boat sales have run aground.
Used boats are flooding the market, up for sale at submerged prices. Abandoned boats exist in every marina yard.
Even with fuel prices temporarily low, in the recent past marina gas was about $4.00/gallon. Only Poseidon will know where gas & diesel prices will be next summer. Even blow boat sales are not where they used to be. Boats are the second home that no one, neither the Pennsylvania nor New Jersey Navies, can afford anymore. Existing marinas are at 30-50% utilization-to-capacity. This past summer there were few boats navigating the Bay.
All the good news floated to the citizens of Chestertown, and for that matter Kent County, has been based upon a boating industry of the past that was significantly buoyant. The Mayor of Chestertown needs to ask the question “Can the current and future condition of the boating industry sustain this business endeavor?” before making any more costly course corrections. The compass heading reads ‘too many empty slips, not enough boats, or people owning boats’. That is why the numbers for this business never made sense to the prudent entrepreneur. That is why it should not have made sense to the prudent municipality. What entrepreneur throws good money after bad. The leading edge of this wave has enough volume to toss this project into a continual sea financial disaster. The Mayor wants this business venture now to be buoyed by the Government, with a $4 million Maryland tax payer bailout. There are just not enough buckets of money to sustain and keep this project afloat.
Mr. Mayor, as a Maryland tax payer, I’m out of boating and want to stay out of boating. BOAT is an acronym that stands for Break Out Another Thousand. Keep on breaking out enough thousands and it turns into millions, with little to show for it except for the depreciating value of the hard asset.
Anyone who has owned a boat knows all too well their two greatest days of boating;
the day they bought their boat, and, the day they sold their boat. So it is with this marina.
Mike Waal
Tolchester Heights
Tom Steele says
Seems simple enough – build it and they will come. The marina has been little more than a sad collection of rotting docks, old gas pumps and a graveyard of boats on the hard in various states of disrepair for years now. Were it not for the attraction of the town itself, there would be little reason to dock there.
The river and the town are inseparable. It only makes sense to improve the waterfront.
Mike Waal says
Tom, thanks for your reply to my L-T-E.
Do you know how many marinas there are already along the shores of the Chester River, on both sides, from Kent Narrows to Chestertown? Unfortunately, there are no more “they” to come here, that is the point. People are getting out of boating. The market for seasonal slip holders is somewhere between stagnant-at-best [because boat owners can’t sell their boats; just like home owners during the housing market collapse, a lot of boat owners are underwater, no pun intended, with their boat debt load] to decreasing at a steady rate. Having another marina, especially one on the shores of Kent County, just cuts one more slice into the ever-decreasing marina market pie, affecting existing marina businesses. What would be the motivation or purpose for a current boat owner to rent a slip here and move their boat and all their boat stuff from one marina to another? Chestertown in and of its self is not a reason. Chestertown as a destination point for a cruise is a good idea, but you don’t require a 92 slip marina for that. And once you have visited Chestertown, what is the attraction to constantly and continually come back. Tea Party. That is it. And right now the future of Tea Party is in question.
Do we as tax payers want to spend $6 million [$2 acquisition price, and $4 million construction cost] for a once a year boaters destination event? I don’t. What is the ROI on that endeavor? And, lest we forget, there are the continual operational costs of a marina; piling and dock replacements, dredging. The $4 million construction cost is NOT a once-and-done non-recurring cost. I don’t know who completed the Pro forma for the Town of Chestertown to show proof positive that a marina would be a continual profitable business, and not a continual drain on tax payers. If one was not done, one should be, and by a totally out-of-area independent accounting firm, before we go any further with tax payer money.
By my rough estimate, the length of the Chester River from Kent Narrows to Chestertown is about 18-20 miles. [I searched, albeit couldn’t find an exact distance.] A 25 foot hull length, 8.6 foot beam, single gas engine, family cruiser consumes fuel at a rate of about 3 miles per gallon, while a 34 foot hull length, 12.6 foot beam, twin gas engines, family cruiser consumes fuel at a rate of about 1 mile per gallon. I know, I’ve owned both.
Boating is directly linked to a family’s discretionary spending capability. How’s that working out for the average boat owning family?
The construction of a new marina along the shores of the Chester River has to be absolutely, positively, and continually cost effective and profitable, not a continual drain on tax payers. For the sake of water front improvement is not a satisfactory reason. The fact that an entrepreneur would not under this business endeavor is not justification for a municipality to undertake it.
Mike
Tom Steele says
Mike-
To my knowledge, there is only one marina that is actually in Chestertown and that has direct access to the historic district. It may be that there is a dwindling number of boaters due to recent economic conditions, but I seriously doubt people in this region are going to give it up wholesale.
The only sure thing here is that people won’t come to a run-down marina. You have to make it worth their while.
MIke Waal says
But Tom, is this marina financially sustainable? I don’t believe it is.
A historic district is not a good reason for a “build it and they will come.” A historic district is a great cruise destination.
What is the percent utilization required for ‘break even’ for this 92 slip marina , renting six month seasonal slips?
There are about 22, maybe 24 marinas on the shores of Kent County.
Counting the ones on the Cecil County side of the Sassafras and it is about 28.
Chestertown Marina is going to compete with these marinas for the slip renting boaters that are left.
What is the draw for boaters to rent their six month seasonal slips in Chestertown> It is not a historic district!
They can drive here from anyone of the above mentioned marinas that they are already at. A B-T-W, they do that already!
Why is a 92 slip marina required as a destination marina?
How about a 20 slip marina?
How about selling the property and re-starting the Trolley?
Tom, if this business model looks so financially sustainable forward looking, how about Chestertown look for local investors like you to fund the building of this marina? Surely if this is a really, really good investment, with a sound Business Plan and Pro forma,
you and others would invest your personal money in it.
400 investors, not a lot by any means for the population of Chestertown, ten thousand dollars a piece.
You in?