The Tribune

• Ex-ABM chief singles out 20% dock fee hike

• Warns Bahamian operators may absorb rise

• Also fears 'prohibitive' registration fee jump

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A former Association of Bahamas Marinas (ABM) president yesterday asserted that the Budget has dealt the industry "another slap in the face" through multiple fee increases for dockage and vessel registration.

Peter Maury, who operates Bay Street Marina, told Tribune Business the hikes contained in legislative reforms accompanying the 2023-2024 Budget will not fall solely on wealthy foreign boat owners and charter guests as the Davis administration likely intended.

He explained that, with dock rental contracts and associated terms already agreed with clients in advance, Bahamian marina operators throughout the country will have little choice but to "eat" at least a portion of the 20 percent dock fee increase imposed on their commercial clients.

As a result, Mr Maury said there could be "a direct loss of revenue" to locally-owned companies. He also voiced consternation over the fee increases, and the way they have been structured, in the Boat Registration (Yacht) (Amendment) Rules 2023 which were also tabled in the House of Assembly with the 2023-2024 Budget.

Noting seven and ten-fold increases in first-time registration fees for particular classes of vessel, the former ABM president argued that the gulf between these and the new annual registration fees set out in the rules "makes no sense" given that the former are far higher.

Arguing that the first-time vessel registration fees are "prohibitive", and will deter vessel owners from bringing their boats to The Bahamas to be registers, he asserted that it sent the signal of "don't come in the door" to a high-spending tourism industry segment that the country has been seeking to grow and develop following the key role it played in driving the post-COVID rebound.

Pointing out that the marina and boating industry had to contend with the imposition of 10 percent VAT on yacht charter fees in the prior year's Budget, on top of the already-existing 4 percent Port Department fee, Mr Maury queried whether the Government's "intention is to kill the marinas".

The Ports Authorities (Amendment) Bill 2023 stipulates in its "objects and reasons" section that the purpose is "to increase the fee payable for the use of various marine structures" such as docks, jetties, groins, moorings, causeways and pipelines. And the "pierage rate", based on a vessel's registered length, is to increase by one cent per foot to eight cents.

"It's a 20 percent increase on the docks," Mr Maury told Tribune Business of the per foot fee to be paid by marinas' commercial vessel customers with effect from July 1. "It's basically a 20 percent increase on the fees we pay for commercial vessels to dock. It looks like everything's getting an increase - the private, industrial.

"Nassau and the Family Islands will see it. For the marinas it's an operating cost that we can pass on the customer, but at some point the customer's going to break and say: 'We're not going to absorb or pay this'. And it might not necessarily be something that we can pass on. It might be a direct loss to revenue for us. A lot of us have set terms, monthly and weekly rentals, and we can't just increase somebody's dockage by 20 percent. It would be a direct loss to the business....

"There's no good news here. Last year was a killer for us. This is just another slap in the face as far as I'm concerned. It definitely doesn't help us with our operating expenses because now we have to pay more. I'm wondering what they [the Government] did do for us. Increased dock tax, increased charter fees, increased harbour fees. This is not going to help the industry or Bahamians."

As for the revised boat registration fees, Mr Maury said those for first-time registrants of vessels between 40 to 49 feet in length, and 50 to 59 feet, are set to increase from the previous $1,000 to $7,000 and $10,000 respectively. Yet for non-first timers, paying the annual registration permit, the fees for the same-length vessels are being set at $1,650 and $2,300, respectively.

The former ABM president questioned why access to The Bahamas was seemingly being hiked to such an extent in comparison to the fees paid by renewing vessel owners. This, he argued, seemingly ran counter to the Government's desire to develop a yacht registry given that the higher first-time fees - a 200-foot yacht will have to pay $35,000 compared to the current $4,000 - could be viewed by owners as cost prohibitive and deter them from coming to The Bahamas.

"These are the boats we want here," Mr Maury said. "It makes no sense making the first-year fee so prohibitive. It's like the first time you walk in the restaurant, and they say: 'Don't come in the door'. It's like totally backwards. This is where we kill ourselves. We have one rate for this, one rate for that.

"We got VAT on the charter fee last year. We still have the charter fee and VAT. Now the registration fee has gone up and, even more than that, the dockage tax marinas pay. There's nothing in there for Bahamians. We're all fighting to keep boats in the marina. We can't hit our customers with a 20 percent dockage fee; we have to eat that. It makes it less profitable to be a marina."

Asked whether the industry has informed its boating clients of the impending fee increases, he added: "We've not shown this to the customer right now. We're all fighting to keep our summers. Oh boy. I don't think it's going to be good either way. We have some serious messaging to do. When the Government puts out the message, it's a little abrupt. I think we have to soften the message."

Mr Maury said marinas were still trying to determine if the Harbour Dues Amendment Bill 2023, which provides for "increased lending rates and pierage charges", and expands the definition of "declared ports", applies to the sector. The Customs Management Act reforms also enable Customs to seize a vessel if the owner has not submitted an inbound declaration, and "is not duly entered in The Bahamas", or has failed to renew an expired cruising permit.

The Government will likely argue that most boats are owned by wealthy foreigners who can afford to pay the fee increases detailed in the legislative reforms that accompany all Budgets. However, as industries and executives begin to read and assess these Bills, it is only now that the scope of the Budget rises are becoming apparent to many in the private sector.