Port Elgin Harbour Strategic Assessment Final Report

Transcription

1 Port Elgin Harbour Strategic Assessment Final Report January 2018 i

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3 Table of Contents EXECUTIVE SUMMARY... ix SECTION 1 - INTRODUCTION Background Study Approach Report Format... 3 SECTION 2 - EXISTING RECREATIONAL BOATING FACILITIES IN BRUCE AND GREY COUNTIES Boating Facilities Amenities and Services Seasonal and Transient Slip Users Comparison of Port Elgin Harbour s Boating Facilities with Bruce and Grey Counties Comparison of Port Elgin Harbour s Rates and Fees with Bruce and Grey Counties Annual Rate Increases Seasonal Slip Occupancy at Port Elgin Harbour Marina Assessment of Infrastructural Features at Port Elgin Harbour SECTION 3 - TRENDS IN RECREATIONAL BOATING AND MARINAS Introduction Boater Profile Socio-demographic Characteristics of Port Elgin Harbour s Seasonal Boater Market Projected Population of Areas with Highest Potential for Seasonal Boaters 2017 to Projected Growth in Boating Activities Historical Number of Boats by Length, Beam, and Draft, 2011 to Length Beam Draft Projected Number of Boats 2017 to Length of Ontario Boats Beam of Ontario Boats Draft of Ontario Boats Length of Michigan State Boats Beam of Michigan State Boats Draft of Michigan State Boats Length of Ohio State Boats Beam of Ohio State Boats Draft of Ohio State Boats Implications of Growth in Ontario, Michigan and Ohio Boats for Port Elgin Harbour Marina Transient Boaters Trends at Marinas SECTION 4 - MARINA OPERATION Operation of Municipal Marinas Organization and Operation of Port Elgin Harbour Marina Necessary Marina Facilities and Services Water Supply Sanitary Facilities and Waste Water Systems iii

4 4.3.3 Fire Protection Water Systems Solid Waste Waste Oil Laundry Facilities Marina Office Operational Aspects Service Orientation Insurance Security and Surveillance Concierge Services Operations Manual Maintenance Operation of Port Elgin Harbour Marina SECTION 5 - FINANCIAL REVIEW Review of Port Elgin Harbour Marina Revenues Potential Sources of Increased or New Revenue Review of Port Elgin Harbour Marina Expenditures Comparison with Other Ontario Marinas SECTION 6 - RECOMMENDED FACILITIES AND SERVICES AT PORT ELGIN HARBOUR MARINA Preferred On-site Marina Amenities and Services Recommended Facilities and Services at Port Elgin Harbour Marina SECTION 7 - TEN YEAR CAPITAL DEVELOPMENT PLAN Introduction North Dock Replacement Security Measures Marina Service Improvements Construction Cost Estimates SECTION 8 - FINANCIAL PROJECTIONS FOR PORT ELGIN HARBOUR MARINA General Operating Assumptions Specific Financial Assumptions for Publically Operated Marina Financial Projections SECTION 9 SUMMARY OF KEY FINDINGS AND RECOMMENDATIONS Key Findings Key Recommendations List of Tables Table 1 - Boating Facilities in Bruce and Grey Counties... 5 Table 2 - Boating Facilities at Port Elgin Harbour Compared with Bruce and Grey Counties... 8 Table 3 - Comparison of Rates and Fees in Bruce and Grey Counties... 8 Table 4 - Evaluation of Port Elgin Harbour s Boating Facilities Table 5 - Summary of Seasonal Slip Occupancy Table 6 - Participation in Boating Activities Table 7 - Projected Growth in Ontario Boats by Length (2017 to 2037) iv

5 Table 8 - Projected Growth in Ontario Boats by Beam (2017 to 2037) Table 9 - Projected Growth in Ontario Boats by Draft (2017 to 2037) Table 10 - Projected Growth in Michigan State Boats by Length (2017 to 2037) Table 11 - Projected Growth in Michigan State Boats by Beam (2017 to 2037) Table 12 - Projected Growth in Michigan State Boats by Draft (2017 to 2037) Table 13 - Projected Growth in Ohio State Boats by Length (2017 to 2037) Table 14 - Projected Growth in Ohio State Boats by Beam (2017 to 2037) Table 15 - Projected Growth in Ohio State Boats by Draft (2017 to 2037) Table 16 - Occupancy Rates for Established Transient Marina in Good Market Table 17 - Importance of Amenities and Services for Transient Boaters Table 18 - Recommended Number of Sanitary Facilities for Marinas of Varying Size Table 19 - Perception of Value for Selected Marina Fees at Port Elgin Harbour Marina Table 20 - Slip Renewal and Payment Process at Port Elgin Harbour Marina Table 21 - Preference for On-site Amenities and Services for Seasonal Boaters at Port Elgin Harbour Marina Table 22 - Great Lakes Cruise Company Ships Table 23 - Replacement Slips by Size in North Basin Table 24 - Summary of Construction Cost Estimates Table 25 - Projected Occupancy of 243 Seasonal Slips Table 26 - Projected Transient Boater Days for 15 Slips List of Figures Figure 1 - Layout of Existing Docks... 2 Figure 2 - Amenities and Services at Boating Facilities in Bruce and Grey Counties... 6 Figure 3 - Comparison of Marinas In Bruce Grey Based on 17 Facilities and Services Figure 4 - Boating Participation in Ontario Figure 5 - New Boat Buyer Age Distribution Figure 6 - Population Projections 2017 to 2037 (25 and over) for Areas with Highest Potential Figure 7 - Population Projections 2017 to 2037 (25 and over) for Areas with Some Potential Figure 8 - Projected Growth in Percentage of Ontario s Population Participating in Selected Boating Activities Figure 9 - Projected Growth in Power and Sail Boaters by Age Group in Areas with Highest Potential Figure 10 - Projected Annual Growth in Power and Sail Boaters in Areas with Highest Potential Figure 11 - Percentage Increase in Number of Boats in Ontario, Michigan and Ohio by Length (2017 to 2037) Figure 12 - Port Elgin Harbour Organizational Chart Figure 13 - Contact with Marina Management and Casual Staff at Port Elgin Harbour Marina Figure 14 - Port Elgin Marina Proposed Dock Layout List of EXHIBITS EXHIBIT 1A MARINAS, YACHT AND BOAT CLUBS WITHIN PORT ELGIN HARBOUR S SEASONAL MARKET AREA NUMBER AND SIZE OF SLIPS EXHIBIT 1B MARINAS, YACHT AND BOAT CLUBS WITHIN PORT ELGIN HARBOUR S SEASONAL MARKET AREA FACILITIES AND SERVICES EXHIBIT 1C MARINAS, YACHT AND BOAT CLUBS WITHIN PORT ELGIN HARBOUR S SEASONAL MARKET AREA FEES AND USER PATTERNS EXHIBIT 2 COMPARISON OF 2016 SUMMER AND WINTER MARINA FEES AT PORT ELGIN HARBOUR AND BRUCE AND GREY COUNTIES EXHIBIT 3 MARINA FACILITIES AND SERVICES RATING EXHIBIT 4 EVALUATION OF MARINA SERVICES AND FACILITIES IN BRUCE AND GREY COUNTIES EXHIBIT 5 COMPARISON OF PORT ELGIN HARBOUR FEES 2014 TO EXHIBIT 6 PROGRAMS AND FACILITIES OFFERED BY YACHT CLUBS WITHIN SAUGEEN v

6 SHORES EXHIBIT 7A ASSESSMENT OF DOCKS, FAIRWAYS, BREAKWATERS AND FUEL DOCK AT PORT ELGIN HARBOUR MARINA EXHIBIT 7B ASSESSMENT OF PUMP OUT STATION, LAUNCH RAMPS AND SECURITY MEASURES AT PORT ELGIN HARBOUR MARINA EXHIBIT 8 SELECTED SOCIO-DEMOGRAPHIC CHARACTERISTICS OF RESIDENTS WITHIN PORT ELGIN HARBOUR SEASONAL BOATER MAJOR MARKET AREA EXHIBIT 9 POPULATION PROJECTIONS FOR ONTARIO COUNTIES WITH HIGH POTENTIAL FOR RECREATIONAL BOATING AT PORT ELGIN HARBOUR BY AGE AND GENDER CATEGORIES EXHIBIT 10 POPULATION PROJECTIONS FOR ONTARIO COUNTIES WITH SOME POTENTIAL FOR RECREATIONAL BOATING AT PORT ELGIN HARBOUR BY AGE AND GENDER CATEGORIES EXHIBIT 11 POPULATION PROJECTIONS FOR ONTARIO BY AGE AND GENDER CATEGORIES IMPORTANT TO RECREATIONAL BOATING EXHIBIT 12 POPULATION PROJECTIONS FOR ONTARIO COUNTIES WITH LOW POTENTIAL FOR RECREATIONAL BOATING AT PORT ELGIN HARBOUR BY AGE AND GENDER CATEGORIES EXHIBIT 13 LENGTH OF BOATS REGISTERED WITHIN ONTARIO, MICHIGAN AND OHIO EXHIBIT 14 BEAM (WIDTH) OF BOATS REGISTERED WITHIN ONTARIO, MICHIGAN AND OHIO EXHIBIT 15 DRAFT OF BOATS REGISTERED WITHIN ONTARIO, MICHIGAN AND OHIO EXHIBIT 16 TYPE OF BOATS REGISTERED WITHIN ONTARIO, MICHIGAN AND OHIO EXHIBIT 17 PLEASURE CRAFT LICENSES GRANTED BY TRANSPORT CANADA IN ONTARIO EXHIBIT 18 PLEASURE CRAFT LICENSES CANCELLED BY TRANSPORT CANADA IN ONTARIO.. 98 EXHIBIT 19 TOTAL ADDITIONAL REGISTERED PLEASURE CRAFT IN ONTARIO EXHIBIT 20 PROJECTED GROWTH BY LENGTH OF BOATS REGISTERED IN ONTARIO (2017 TO 2037) EXHIBIT 21 PROJECTED GROWTH BY BEAM (WIDTH) OF BOATS REGISTERED IN ONTARIO (2017 TO 2037) EXHIBIT 22 PROJECTED GROWTH BY DRAFT OF BOATS REGISTERED IN ONTARIO (2017 TO 2037) EXHIBIT 23 PROJECTED GROWTH BY TYPE OF BOATS REGISTERED IN ONTARIO (2017 TO 2037) EXHIBIT 24 PROJECTED GROWTH BY LENGTH OF BOATS REGISTERED IN MICHIGAN (2017 TO 2037) EXHIBIT 25 PROJECTED GROWTH BY BEAM (WIDTH) OF BOATS REGISTERED IN MICHIGAN (2017 TO 2037) EXHIBIT 26 PROJECTED GROWTH BY DRAFT OF BOATS REGISTERED IN MICHIGAN (2017 TO 2037) EXHIBIT 27 PROJECTED GROWTH BY TYPE OF BOATS REGISTERED IN MICHIGAN (2017 TO 2037) EXHIBIT 28 PROJECTED GROWTH BY LENGTH OF BOATS REGISTERED IN OHIO (2017 TO 2037) EXHIBIT 29 PROJECTED GROWTH BY BEAM (WIDTH) OF BOATS REGISTERED IN OHIO (2017 TO 2037) EXHIBIT 30 PROJECTED GROWTH BY DRAFT OF BOATS REGISTERED IN OHIO (2017 TO 2037) EXHIBIT 31 PROJECTED GROWTH BY TYPE OF BOATS REGISTERED IN OHIO (2017 TO 2037) 110 EXHIBIT 32 PROFIT SHARING SCHEDULE WITH KINCARDINE YACHT CLUB EXHIBIT 33 REVENUES AND EXPENSES PORT ELGIN HARBOUR EXHIBIT 34 INCOME STATEMENT RATIOS FOR ONTARIO MARINAS EXHIBIT 35 FINANCIAL PERFORMANCE OF SIMILAR SIZED MARINAS IN ONTARIO EXHIBIT 36 SURVEY OF TRANSIENT BOATERS EXHIBIT 37 SURVEY OF BOATERS AND SAUGEEN SHORES RESIDENTS EXHIBIT 38 FACILITIES/SERVICES TO BE CONSIDERED FOR PORT ELGIN HARBOUR MARINA 119 vi

7 EXHIBIT 39 DOCK REPLACEMENT COST ESTIMATE EXHIBIT 40 PROJECTED USE OF TRANSIENT SLIPS AT PORT ELGIN HARBOUR MARINA (15 Transient Slips) EXHIBIT 41 PORT ELGIN HARBOUR MARINA FINANCIAL PROJECTIONS (258 Slips Seasonal) vii

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9 EXECUTIVE SUMMARY Study Objectives TOURISTICS and Shoreplan Engineering Limited were retained by the Town of Saugeen Shores to complete a strategic assessment of the Port Elgin Harbour. There is concern with the future of boating in Port Elgin and the sustainability of the harbour, especially since the municipality has invested substantially in infrastructural improvements since 2012, including dredging, electrical upgrades, gate installations to docks, washroom enhancements, and new docks to accommodate 82 slips from 32 to 40 feet (i.e. 9.8 to 12 metres) on the south side of the harbour. Over the last number of years, there has been a decrease in the number of users, particularly transient boaters from the United States. It is evident as shown in the Figure below that demand has been consistently strong for longer slips with full service, but not for the shorter un-serviced slips Percentage of Slips Occupied Dock B (32 to 40 ft.) all with hydro & water Dock C (32 to 40 ft.) all with hydro & water Dock H (30 ft.) all with hydro & water Dock G (20 to 30 ft.) some with hydro & water Dock F (24 to 28 ft.) no hydro & water Dock I (20 ft.) no hydro & water The intent of the strategic assessment is to provide the Town with recommendations regarding preferred management solutions, potential partnership opportunities, revenue opportunities, optimum operating hours and staff compliment. The assessment is also expected to comment on the viability for current and future rates and fees, and conduct an analysis of the use of the existing slips and services with a view to their need going forward based on current and expected future boating market conditions. A 10 Year Capital Forecast is to be included. Key Findings Comparison of Port Elgin Harbour s Boating Facilities with Bruce and Grey Counties Seasonal and transient boaters at Port Elgin Harbour are better served than the other facilities in Bruce and Grey in terms of having a fuel dock, pump out service, launch ramp and on-site winter storage. At the same time, as highlighted in yellow in the Table following, seasonal boaters at Port Elgin Harbour appear to be less well served than those in Grey and Bruce Counties in terms of size of slips, serviced slips and adequate power. Port Elgin Harbour has almost twice as many un-serviced slips as those in the two counties. Port Elgin Harbour has more than twice as many slips less than 26 feet than the other facilities, proportionately fewer slips 36 feet to less than 46 feet, and 46 feet and longer. While less than ix

10 7 percent of the slips in the two counties have 50 amp power, there are none available at Port Elgin Harbour. Three are considering adding 50 amp power to a number of their slips. Port Elgin Harbour Bruce and Grey Counties Number of Seasonal Slips Seasonal Slips Occupied % 1, % Dedicated Transient Slips as Percentage of Total Slips 0% 22.7% Percentage of Overall Transient Visits 7.7% 100% Percentage of Slips <26 feet 33.6% 13.8% Percentage of Slips 26 feet to <30 feet 9.0% 13.4% Percentage of Slips 30 feet to <36 feet 35.8% 39.0% Percentage of Slips 36 feet to <46 feet 21.6% 30.2% Percentage of Slips 46 feet and over 0% 3.6% Percentage of Facilities with Fuel Dock 100% 61.1% Percentage of Facilities with Pump Out 100% 55.6% Percentage of Facilities with Launch Ramp 100% 66.7% Percentage of Total Slips Un-serviced Slips 42.5% 22.8% Percentage of Slips with 30 amp Power 57.5% 59.8% Percentage of Slips with 50 amp Power 0% 6.7% Percentage of Facilities with on-site Winter Storage 100% 50.0% Comparison of Port Elgin Harbour s Rates and Fees with Bruce and Grey Counties The 2016 rates and fees at Port Elgin Harbour Marina are in the upper to upper middle range compared to other facilities in Bruce and Grey. Slip with Service Unserviced Slip Pump Out Daily Transient Fee Daily Launch Ramp Fee Haulout/ Launch Fee Outside Winter Storage Highest $ $91.00/ft. $59.80/ft. $20.00/tank $1.95/ft. $15.00 $13.25/ft. $52.90/ft. Lowest $ $48.19/ft. $42.50/ft. $14.70/tank $1.50/ft. $5.00 $6.67/ft. $8.64/ft Port Elgin Harbour Marina $65.91/ft. $59.80/ft. $14.70/tank $1.82/ft. $8.85 $10.00/ft. $8.72/ft. The rate increases at Port Elgin Harbour between 2013 and 2015 were above the area average while those for 2016 were in line with the area facilities. Trends in Recreational Boating and Marinas The profile of boaters and the use of their boats have changed significantly over the past decade and all indications are that they will continue to do so in the future. Previously it was not unusual to go out on the boat for the better part of at least one day on the weekend and a couple of evenings during the week. Today s work and family commitments place numerous demands on one s time, and the result is that most boats are actually being used less and less, with 40 percent or more of their seasonal boaters never taking their boat out of the slip during the boating season. Today s boaters still want to escape, but want to bring it all with them a refrigerator, hot-tub, air conditioning, television, WiFi, cell service and lots more. And yet time aboard is becoming less and less. Less than a decade ago the trending range for recreational boats was from 30 to 40 feet. Today, the typical demand is for much larger vessels (i.e. 46 feet and over). Boats have been getting longer, wider and deeper and have more things on-board that require power. 30 and 50 amp service is the standard for average marinas today, and it can range to 100 to 200 amps for larger sized boats. The change in how boats are used affects every aspect of the boating industry with one common theme ease of use combined with comfort. For marinas and yacht clubs, this means providing and maintaining x

11 sturdier and more spacious docking facilities, deeper water depths, upgraded physical appearances, more attractive restrooms, upgraded electricity for boats, better lighting, and usually more and/or upgraded amenities. Between 2000 and 2015, the age of the average new boat buyer has increased from 45 to 53. During that same time period the percentage of new-boat buyers under 40 has shrunk by nearly one-half. Age Distribution of Canadian New Boat Buyer's Percentage of Total <25 25 to to to to to to to to to to Age Buyers in 2000 Buyers in 2015 Projected Population in Bruce County, Wellington County, Regional Municipality of Waterloo During the next twenty year period the age profile of the population in the market area with the highest potential for seasonal boaters for Port Elgin Harbour Marina (i.e. Bruce County, Wellington County, Regional Municipality of Waterloo) will change dramatically as the number of males and females 45 to 54 (i.e. second highest participation rate in boating and highest percentage of new boat buyers) will decrease slightly from 117,924 in 2017 to 114,066 in 2027 and then increase to 132,572 by 2037, while the number of males and females 65 and over will increase from 134,707 in 2017, to 197,212 in 2027, and reach 249,215 by This suggests that there may be a weakening in seasonal slip demand during the period from 2017 to 2027, prior to an increase in demand above the 2017 levels, beginning in 2028 and continuing until at least It will be important that the management of Port Elgin Harbour Marina increase their efforts to maintain the existing seasonal slip holders during the period of potential decreased new demand. With the increased number of older power and sail boaters it will be important for Port Elgin Harbour Marina and other marinas to provide wider and more stable finger docks. Projected Number of Power and Sail Boaters in Bruce County, Wellington County, Regional Municipality of Waterloo Overall, the number of male and female power and sail boaters in Bruce County, Wellington County and the Regional Municipality of Waterloo will increase from 80,590 in 2017 to 94,290 by 2037 with a slight decrease between 2027 and xi

12 Projected Population in Bruce, Wellington and Waterloo 2017 to 2037 Population 25 Years and Older 140, , ,000 80,000 60,000 40,000 20,000 0 Male Female Male Female Male Female Male Female Male Female Year 25 to to to to Projected Annual Growth in Power and Sail Boaters in Bruce, Wellington and Waterloo Number of Power & Sail Boaters 95,000 90,000 85,000 80,000 75,000 70,000 Year Projected Growth in Boating Activity Between 2010 and 2035 participation in power boating, sailing, canoeing, kayaking and rowing are all projected to increase. It should be noted however, that the increases in power boating and sailing are much slower than those of the other activities. There are no comparable projections available for outrigger canoeing, dragon boat racing, paddle boating, and stand up paddle boarding, although anecdotal information based on the increased number of members at area clubs suggests that participation in these activities is also in a growth mode. xii

13 Based on data provided by Statistics Canada, General Social Survey and Ontario Ministry of Tourism, Culture and Sport participation in power boating, sailing, canoeing, kayaking and rowing is projected to increase over the 25 years between 2010 and 2035 as shown below. Percentage of Population 16 or over Participating Year Power & Sail Boating Power Boating Sailing Canoeing Kayaking Rowing Projected Growth in Power and Sail Boats 2017 to 2037 The projected increased growth in the length of boats will have a particularly strong impact on the facilities in Bruce and Grey Counties where there is already a shortage of longer slips and a number of the fairways are sub-standard in terms of width. This shortage will be further exacerbated as there will be a need to modify the number of slips to accommodate wider beam widths. For those facilities that are currently using the entire water basin an increase in slips lengths and/or space between finger docks may mean a reduction in the overall number of slips provided. It will also have a particularly negative impact on those facilities with fixed docks. For Port Elgin Harbour Marina to continue to attract its fair share of seasonal boaters it will be necessary to increase the number of docks 36 feet to less than 46 feet and add docks that are 46 or more feet in length. Length % increase 20 ft. to <26 ft. (6 m. to <8 m.) 55,470 57,020 58,050 58,600 59, % 26 ft. to <30 ft. (8 m. to <9 m.) 13,320 15,150 15,920 16,540 17, % 30 ft. to <36 ft. (9 m. to <11 m.) 21,240 24,440 27,550 30,300 32, % 36 ft. to <46 ft. (11 m. to <14 m.) 13,360 16,050 18,840 21,490 24, % 46 ft. and over (14 m. or more) 7,800 9,820 12,060 14,490 17, % The projections for the growth in the length, beam, and draft of recreational sail and power boats in Michigan and Ohio exhibit a generally similar pattern to that of Ontario boats, just much slower. The projected growth of boats in Michigan capable of making a cross-the-lake trip should mean that more Michigan boats will visit Port Elgin Harbour. Prior to 2017, the number of boats in the state had been in a steady decline. Boats 26 feet or more in length (i.e. 8 metres or more) are projected to grow by 3.2 percent per annum in Ontario, 0.8 percent in Michigan, and 1.3 percent in Ohio between 2017 and As a result, by 2037 Ontario boats will generate a much larger share of the transient boats visiting Port Elgin Harbour Marina. But marinas and yacht clubs in Bruce and Grey Counties catering to transient boats from Michigan and Ohio will need to provide longer docks and wider slips as is the case in catering xiii

14 to transient boats from Ontario. In order to accommodate the larger boats Port Elgin Harbour Marina will need to provide more longer slips, a number of which should have 50 amp. power. Organization and Operation of Port Elgin Harbour Marina Port Elgin Harbour Marina operates from May 1 st until October 31 st annually. A Harbour Master oversees the operations under the direction of the Parks Manager who reports to the Director of Community Services. The Harbour Master is employed for approximately 30 weeks of the year beginning April 1 st. An Assistant Manager is employed for approximately 26 weeks. Depending on budget five to seven casual staff are hired annually to assist with the harbour operations and work for approximately 35 hours each week of their employment. Director Community Services Parks Manager Assistant Harbour Master (Adult) Harbour Master (Adult) Maintenance Person (Half time) Dockhand (Student) Dockhand (Student) Dockhand (Student) Dockhand (Student) Dockhand (Student) Ideally there should be a Harbour Master and Assistant Harbour Master both of whom are adults with some experience in operating a marina. The Harbour Master in particular should have a minimum 3 to 5 years experience. Either the Harbour Master or Assistant should be on site with a least one dockhand during all operating hours of the marina. During weekends and statutory holiday weekdays from June 1 until Labour Day at least two dockhands should be on duty during all operating hours. The maintenance person works part time for the marina with the other time assigned to other duties with the municipality. This same procedure for maintenance is common with small municipally operated marinas. As with most marinas, dockhands can be students or adults with minimum boating experience although a thorough training session should be completed at the commencement of their work period for the boating season. At least one of the marina employees on duty should have training in basic first aid. Dockhands are typically responsible for assisting seasonal and transient boaters when required, operating the fuel pumps and pump out and keeping the washrooms and docks clean at all times. Ideally the washrooms should be checked and cleaned more than once per day and the main and finger docks and power pedestals swept of debris daily. Our analysis of staffing levels at the other marinas within the Bruce/Grey Area and other areas of Ontario indicates that the staffing level for casual staff proposed for 2017 is on the low side. The industry norm is approximately one casual staff for every 25 occupied slips in a marina catering to seasonal and transient xiv

15 boaters. Based on the 2016 occupancy rate this would equate to a need for approximately 9 casual staff. Should the marina reach full occupancy again the number of casual staff during the peak operating period from mid June to Labour Day should be increased to 11. Based on our review and analysis of marina operations throughout Ontario we believe the current system employed at Port Elgin Harbour should be continued. We also recommend that consideration be given to offering the Harbour Master a three year contract based on approximately 30 weeks per year with a small percentage increase each year in keeping with what is offered to municipal staff at the same level (i.e. 1½ to 3%). Ensuring that the Harbour Master is in place for a number of years will promote a sense of stability of operation among the boaters and should allow for a smoother transition from one year to the next with new programs and policies that are introduced. Boater s Perception of Contact with Marina Management and Casual Staff The survey of boater and Saugeen Shores residents reveals that there is little need for change in the relationship between the boaters and/or the casual staff. In addition, more than 87 percent of the boaters approve of the current hours of operation. Approximately 10 percent of those responding to the survey would like the marina to remain open until 9:00 pm during peak summer operating hours. Boater's Perception of Contact with Marina Management and Casual Staff Percent Ease of contacting marina management Follow-up after contacting marina management No Need for Change Great Need for Change Ease of dealing with casual marina staff Response of casual marina staff to request Level of Need for Change Port Elgin Harbour Marina Revenues Our review of the financial statements from 2010 to 2015 and the budget for 2016 indicates that the Port Elgin Harbour Marina is a well run marina. We believe an effort should be made to increase the number of boats that are winter stored on site. Many of the marinas in the area and throughout Ontario retain a higher proportion of their seasonal boaters over the winter than Port Elgin Harbour Marina. A more secure environment for storage (i.e. fencing, web cam coverage) would help encourage more boaters to winter store their boats on-site. Revenues accruing from the sale of fuel are at the upper end of the profit margin ratio (i.e. 15 to 20%) which is good for business but should be reviewed on an annual basis to ensure that the margin is not excessive. It is recognized that the constant fluctuations in the price that the marina pays for fuel will not make this easy. Boaters also need to recognize that since the marina can only purchase a limited quantity of fuel at one time that prices are generally above street prices. An attempt should also be made to increase the space available within or in close proximity of the marina office for ship s store related products to be sold. The typical mark up on this merchandise is anywhere xv

16 from 60 to 80 percent and can be an important profit centre for the marina. If space does not permit within the marina office building, consideration may be given to having a local business sell these products on the marina property for a percentage of gross or net sales. Consideration should also be given to ways in which the launch ramp can be better monitored to ensure that all users are paying for the use of the ramp. Port Elgin s seasonal slip fee is approximately 2 percent above the average of $64.67 for the marina facilities in the Bruce and Grey Counties, and Port Elgin Harbour Marina has the highest fee for an unserviced slip at $59.80 per linear foot. Approximately 40 percent of those responding to the Boater and Saugeen Shores Resident survey perceive that the seasonal slip fees are poor or somewhat poor value. In order to bring the seasonal slip fees more in line with the market area, we recommend that the fees for the slips at the south end of the harbour be raised no more than 2 percent annually until they are equal to the area average, and the fees for the north end slips be raised no more than one percent annually until they are replaced with docks of similar quality to those at the south end. An annual survey of marina fees in Bruce and Grey Counties should then be used as a guide for those at Port Elgin Harbour. Poor Value Good Value Seasonal slip rental fee 13.1% 27.3% 37.4% 13.1% 9.1% Winter storage fee 11.1% 14.8% 45.7% 14.8% 13.6% Daily launch ramp fee 12.2% 8.5% 40.2% 15.9% 23.2% Seasonal launch ramp fee 9.8% 6.1% 45.1% 12.2% 26.8% Cost of fuel 18.3% 17.2% 40.9% 12.9% 10.8% Seasonal pump-out fee 14.9% 11.5% 35.6% 19.5% 18.4% Seasonal hydro fee 18.6% 14.0% 34.9% 16.3% 16.3% Potential Sources of Increased or New Revenue Longer slips (i.e. 46 feet) with 50 amp power Tour boats/cruises/tall Ships this would require providing handicapped access from dock Non motorized boat rentals (canoes, kayaks, stand up paddle boards) this would likely require access to the water from the beach at the north end of the marina and a secured area to store the boats and could be carried out in partnership with a local business Bicycle rentals this could be carried out in partnership with a local business Concierge service for seasonal boaters that would involve preparing the boat in advance of the boaters arrival; this activity is becoming more popular at marinas where boaters are only using their boats for short periods of time (i.e. weekends only) and want to maximize their time using the boat Concierge service for transient boaters that could be done in partnership with local businesses who would deliver provisions, pickup and return dry cleaning, pharmacy/drug store needs, etc. Coin laundry service Vending machines Restaurant/bar/lounge when the lease is up for the current facility, the municipality should approach a number of the local restaurant owners to gauge their interest in operating a seasonal satellite operation; the facility would attract both boaters and residents Learning experiences many marinas and yacht clubs use learning experience programs to introduce young persons and those new to boating the skills necessary to handle sail and power boats, thus ensuring there is a continuous market for slips. Organizations such as Kincardine Power and Sail Squadron and BoaterSkills.ca offer on-board and classroom instruction. Port Elgin Harbour Marina Expenses The maintenance and equipment repair expense is considerably below the industry average of approximately 3.6 percent of revenues. Advertising is also below the industry average for marketing and promotion at municipal marinas of approximately one percent, although this may be a function of the area xvi

17 and less need to advertise. Providing the budget for uniforms is excellent as it is a growing trend with marinas and serves to easily identify marina staff especially for transient boaters and seasonal boaters who not familiar with the marina or who are at their slip infrequently. The inclusion of a reserve for replacement is also excellent, as it is not standard with all marinas and can lead to difficult budgeting decisions when major infrastructure needs arise. Although the various line items normally considered as reserve for replacement (i.e. transfer to reserve, transfer to 2017 electrical upgrades, transfer to 2018 upgrades, transfer to 2019 upgrades, and transfer to 2028 dock upgrades) were low between 2009 and 2014, in 2015 and 2016 the total for all items in reserve for replacement was 20 and 19 percent of total revenues respectively was excellent. An amount of 15 to 18 percent per annum is considered ideal with many marinas in Ontario setting aside only 10 percent. Comparison of Port Elgin Harbour Marina s Financial Operation with Other Similar Sized Ontario Marinas Our review of the ratios of the major revenue and expense items generated at Port Elgin Harbour Marina with those of two other similar sized marinas in Ontario (i.e. Portsmouth Olympic Harbour Marina in Kingston and Lakefront Promenade Marina in Mississauga) indicates that the marina is financially sound. The net income derived by Port Elgin Harbour Marina is certainly comparable with the other two. The average annual increase in salaries and wages is similar at the three marinas (i.e. 2.6%, 2.3% and 2.5% respectively). Cost of insurance at Port Elgin Harbour Marina has decreased an average of 4.5% annually while that of Portsmouth Olympic Harbour Marina and Lakefront Promenade Marina has increased 5.0% and 4.0% respectively. The average annual increase in maintenance & repairs costs at Port Elgin Harbour Marina is considerably above the other two at 27.8%, 8.0% and 10.0% respectively). This may be due to the condition of the dock system at the north end of the harbour, in which case, new docks will greatly reduce this expense item. The average annual increase in utilities is also much higher at Port Elgin Harbour Marina compared to the other two (i.e. 27.8%, 8.0% and 3.6% respectively). On the other hand Port Elgin Harbour Marina s office expenses have decreased an average of one percent each year while those of the other two have each increased 3.0 percent each year. Preferred On-site Marina Amenities and Services Amenity/Service Percentage in Favour Some combination of seasonal and transient slips 98.5% Docks with 30 amp power and water 88.5% Internet/WiFi 84.6% Pump-out Station 82.3% Restaurant/Bar/Lounge 81.5% Fuel dock 80.8% Lookout/Observation deck (at end of south or north break wall) 73.8% Boater s store (chandlery offering products primarily of interest to boaters 73.1% Outdoor winter storage for boats 71.5% Mast Crane 70.8% Mobile Travel Lift 68.5% Docks with 50 amp power and water 65.4% Washroom, Shower and Laundry facilities 65.4% Rental bicycles 61.5% Tourist/visitor Information Kiosk 61.5% Engine repairs/tune-ups/replacements 60.0% Dock suitable for accommodating small cruise boats/tall Ships 58.5% Electronic repairs 57.7% Story-boards illustrating history of Port Elgin waterfront 56.9% Slips for Charter Fishing Operators/Tour Boat Operators 56.6% Small boat rental facility (canoes, kayaks, paddleboards) 56.2% Some combination of on-site and off-site parking 53.1% Sail/Canvas repairs/replacements 51.5% On-site parking only 51.5% Hull repairs/refinishing (steel, fiberglass, wood) 50.8% Strongly Favoured Moderately Favoured Favoured xvii

18 All of the strongly favoured amenities and services are currently available on-site in some form. There is a need however to improve the quality of WiFi service available as internet connection is now a way of life for nearly everyone. An on-site restaurant/bar/lounge would be an attractor for seasonal and transient boaters as well as residents of Saugeen Shores and the surrounding area. It is likely however, that a restaurant would only prove financially successful if operated as a seasonal satellite operation by an established local restaurant owner. Among those amenities and services that are moderately favoured, the lookout would likely draw more people to the harbour and increase spending in the area. An on-site chandlery would increase revenue for the marina and could be operated in partnership with a local business. It would need to also draw on boaters from other areas to be successful, as the rule of thumb to generate sufficient sales to succeed is a marina with a minimum of 300 to 350 slips. A mast crane would attract more sail boats to the marina and in combination with a mobile travel lift attract additional power and sail boats for winter storage as it would permit a more efficient launch and haul out and use of storage space. Small boat rental facilities (i.e. canoes, kayaks, paddleboards) and bicycle rentals are becoming more of a standard feature at marinas as the small boat rentals are a means of introducing new boaters to the marina experience and both are revenue generators for the marina which can be operated in partnership with local businesses. Although engine repairs/tune-ups/replacements, electronic repairs, sail/canvas repairs/replacements, and hull repairs/refinishing (steel, fiberglass, wood) are favoured by the boaters and can create considerable revenue for the marina, our experience in speaking to boat repair services throughout the province is that it takes a large marina (i.e. 500 slips minimum) with at least 100 boats stored for the winter to be a successful operation. As a result we do not recommend that this option be considered for the marina site. Recommended Facilities and Services at Port Elgin Harbour Marina It is recommended that the following facilities and services be included in a 10 year capital development program. Add foot slips with 50 amp power. This should involve reducing the number of 20, 24 and 28 foot slips by approximately 23, 6, and one, respectively. Add 50 amp power to approximately one-third of the 40 foot slips. Replace all the remaining north end slips with docks of similar quality to those in the south end of the harbour Provide winged security gates at the entrance to each of the main docks at the north end of the harbour. Install a web cam system at strategic locations throughout the harbour that can be accessed by marina staff and seasonal boaters. Provide security fencing around the winter stored boats at the north end of the harbour. Improve the access to the Lake at the north end of harbour for use by rental or personally owned canoes, kayaks, stand up paddle boards, dry sailing. Purchase or lease a mobile travel lift. Purchase or lease a mast crane. Ten Year Capital Development Plan The following improvements are included in the 10 years capital plan: xviii

19 Replacement of the north docks which would incorporate ft. docks with 50 amp service, 50 amp service for 40 ft. docks (50% +/-), security gates for the main docks, metered power pedestals and access to the basin for rental canoes, kayaks and dry sailing. Security measures including web cam service on site, improved lighting on land areas, security fencing for winter storage and alongshore berm to shelter site from westerly winds. Marina service improvements including mobile travel lift, mast crane and boarding docks at the launch ramp. The north basin docks replacement is considered most important and the other items can follow at a later date. The north dock replacement is to provide the slip count noted below. The docks are expected to be floating docks with anchor system placed on or embedded into the basin bottom. Replacement Slips by Size in the North Basin Length(ft.) Length(m) Slips The access ramps to the main floating docks are proposed to be 9 metres long. This length of ramp does not provide access consistent with The Accessibility for Ontarians with Disabilities Act (AODA) during full a range of possible water levels. The municipality will need to engage in a discussion with local community and confirm what level of access is acceptable. The same applies to access ramps to the boarding docks at the launch ramp. The arrangement of docks along the breakwater on the west side of the basin is also modified. The proposed layout of Dock H runs a main dock parallel to the breakwater with finger docks to be attached to the side of the main dock. This arrangement provides increased stability for the finger docks equal to the other docks within the basin. A security system, such as web cam service that would allow boaters to view the docks and the boat storage areas can be installed. This would provide an increased level of security, but privacy concerns would need to be addressed. Security fencing around the boat storage areas can be implemented. The options for providing the fencing are permanent fencing, temporary fencing or a combination of the two. A mobile travel lift, located at the present locations of a lift out slip, would allow for better control of boat launching and boat retrieval during the spring and fall operations and would facilitate retrieval of boats that require unscheduled repairs or maintenance during the season. The ability of the structure to support these loads must be confirmed. A construction cost estimate to reconstruct the haul out slips, if necessary, has been included in the cost estimate as a provisional item. You may also wish to consider the purchase of a second hand travel lift. This may be a reasonable approach given that the use of the unit will be limited primarily to the launching and retrieval periods. The existing mast crane, although functional, does not allow for easy installation of masts on larger vessels. A larger and higher mast crane is proposed at the same location. Boarding docks at the launch ramp are proposed to be replaced. The proposed replacement is a system that maintains the access on the side of the ramp and provides an additional ramp to the boarding docks from the marina wall adjacent to the launching ramp. Construction costs estimates have been prepared for all components of the 10 year plan. The cost of haul out slip reconstruction is presented as a contingency item, subject to detailed review and assessment of the existing structure. The estimate should be considered a Class D estimate. The construction cost estimates do not include taxes (HST). xix

20 Summary of Construction Cost Estimates Item Estimated Cost ($2017) Estimated Cost (including 15% design cost + 25% construction contingency) ($2017) Replacement of North Docks Supply and installation of docks $1,420,000 $1,988,000 Servicing (for slips 30 feet and more) $300,000 $420, amp service for 50% of 40 foot slips in $54,000 $75,600 south basin Allowance for additional lighting on docks $30,000 $42,000 I, H and F Security Gates (north docks) $32,000 $44,800 Access to basin for small non-motorized $39,000 $54,600 Craft Security Measures Webcam service on site $5,000 $7,000 Improved lighting on land areas $240,000 $336,000 Security fencing for winter storage $17.00/metre $23.80/metre Marina Service Improvements Mobile travel lift $400,000 $560,000 Mast crane $16,000 $22,400 Boarding docks at launch ramp $49,000 $68,600 Provisional Items Replacement of haul out structure $360,000 $504,000 xx

21 SECTION 1 INTRODUCTION 1.0 Background TOURISTICS and Shoreplan Engineering Limited were retained by the Town of Saugeen Shores to complete a strategic assessment of the Port Elgin Harbour. The Harbour is a recreational boating harbour which operates from May 1 st until October 31 st annually. A Harbour Master oversees the operations under the direction of the Parks Manager who reports to the Director of Community Services. The Harbour Master is employed for approximately 30 weeks of the year beginning April 1 st. Five to seven casual staff are hired annually to assist with the harbour operations. The 268 slips catering to seasonal and transient boaters range in size from 20 to 40 feet. Figure 1 following provides an indication of the existing dock layout. The harbour provides both serviced and un-serviced slips. Over the last number of years, there has been a decrease in the number of users, particularly transient boaters from the United States, although the overall use of the harbour was consistent in 2016 and There is concern with the future of boating in Port Elgin and the sustainability of the harbour, especially since the municipality has invested substantially in infrastructural improvements since 2012, including dredging, electrical upgrades, gate installations to docks, washroom enhancements, and new docks to accommodate 82 slips from 32 to 40 feet (i.e. 9.8 to 12 metres) on the south side of the harbour. The intent of the strategic assessment is to provide the Town with recommendations regarding preferred management solutions, potential partnership opportunities, revenue opportunities, optimum operating hours and staff compliment. The assessment is also expected to comment on the viability for current and future rates and fees, and conduct an analysis of the use of the existing slips and services with a view to their need going forward based on current and expected future boating market conditions. The study will also provide a 10 Year Capital Forecast. 1.1 Study Approach In order to complete the strategic assessment, the following steps were undertaken: Conducted a site visit of Port Elgin Harbour to assess the facilities offered and the existing operational conditions of the harbour infrastructure. Conducted a site visit to each of the harbours, marinas, yacht and boat clubs in Bruce and Grey Counties to assess their current product offering. Contacted a representative of each of these facilities to obtain information on the number and size of slips, facilities and services offered, fees charged and user patterns. Designed survey instruments which Town staff used to contact seasonal and transient boaters and residents regarding their use of Port Elgin Harbour and suggestions for any changes in the current operation and/or facilities and services offered. Conducted a telephone/ survey of yacht clubs/marinas on Lakes Huron and Erie regarding amenities and services of importance to transient boaters. Contacted the Harbour Master of Port Elgin Harbour and Commodores of the Port Elgin Yacht Club and Southampton Yacht Club regarding operation and program offerings of their respective facilities and comments regarding the current and future status of recreational boating in the local area. 1

22 Figure 1 Layout of Existing Docks

23 Conducted telephone interviews with the power and sail boat builders/manufacturers in Canada and United States to obtain data on the current and future length, beam, and draft of boats sold and registered in Ontario, Michigan and Ohio, and any forecasts for growth in boating. Contacted Transport Canada for information regarding the number of licensed pleasure craft in Ontario. Contacted the National Marine Manufacturers Association regarding the number of recreational boats in Canada and the United States. Contacted each of the municipalities and conservation authorities within Bruce and Grey area regarding planned or rumoured new marina facilities. 1.2 Report Format The report is divided into nine sections or chapters. Section 2 describes the existing boating facilities within Bruce and Grey Counties and a comparison with those of Port Elgin Harbour. Section 3 provides a discussion of trends in recreational boating and marinas, a profile of power and sail boaters in Ontario, and population and boating activity projections for the period between 2016 and The fourth Section provides a description of a variety of marina operations and a review of Port Elgin Harbour Marina operation. Section 5 presents a review of the revenues and expenses of the marina between 2009 and 2015 and provides recommendations for increased revenue sources and potential partnerships. Section 6 discusses the preferred facilities and services for the marina. The seventh section outlines a ten year capital development plan including dock replacements, increased security measures, and marina service improvements. Section 8 provides a projection of the annual revenues and disbursements over a ten year period assuming Port Elgin Harbour Marina continues as a municipally operated marina. The last Section provides a summary of key findings and recommendations. Figures and tables are inserted in the text of the report as close to the first reference as practical. Detailed EXHIBITS are included in the appendix in the order in which they are referred. Key findings and recommendations are highlighted in blue throughout the text.

24 4

25 SECTION 2 EXISTING RECREATIONAL BOATING FACILITIES IN BRUCE AND GREY COUNTIES 2.1 Boating Facilities There are 18 public and private marinas and yacht clubs accommodating seasonal and transient boats in Bruce and Grey Counties. In addition there are launch ramps at 12 of these facilities providing the opportunity to use trailered boats, small aluminum boats, canoes, kayaks, paddle boards and stand up paddle boards. Each of these facilities is listed in Table 1 below and described in more detail in EXHIBIT 1 at the end of this report. Table 1 - Boating Facilities in Bruce and Grey Counties Facility Location Boating Activity Public Marina Kincardine Marina 249 Station Beach Road, Kincardine Seasonal and transient power & sail boats Port Elgin Harbour Marina 100 Harbour Street, Saugeen Shores Seasonal and transient power & sail boats, sea-doos Little Tub Harbour Municipal 33 Carlton Street, Tobermory Seasonal and transient power & sail boats Docks Lion s Head Marina 1 Dock Street, Lion s Head Seasonal and transient power & sail boats Wiarton Marina 827 Bayview Street, Wiarton Seasonal and transient power & sail boats Wiarton Town Dock Bluewater Park Road, Wiarton Transient power & sail boats Owen Sound City Docks 1 st Avenue East, Owen Sound Transient power & sail boats East Owen Sound City Docks 1 st Avenue West, Owen Sound Transient power & sail boats West Meaford Municipal Marina 3 St. Vincent Street, Meaford Seasonal and transient power & sail boats Meaford Harbour Docks 3 St. Vincent Street, Meaford Transient power & sail boats Thornbury Harbour 41 Bruce Street North, Thornbury Seasonal and transient power & sail boats Private Marina Kit-Wat Marina Motel & Restaurant 71 Sauble Falls Road, Sauble Beach Transient power boats, kayaks, stand up paddle boards Sauble River Marina 18 Marina Avenue, Sauble Beach Seasonal and transient power boats, canoes, kayaks Big Tub Harbour Resort 236 Big Tub Road, Tobermory Seasonal and transient power & sail boats, stand up paddle boards Georgian Shores Marina th Street West, Owen Sound Seasonal and transient power & sail boats, sea-doos Cliff Richardson Boats 103 Bayfield Street, Meaford Transient power & sail boats Yacht Club Southampton Yacht Club 100 Saugeen Street, Southampton Seasonal and transient power & sail boats Georgian Yacht Club rd Avenue West, Owen Sound Seasonal and transient power & sail boats, dry sailing 2.2 Amenities and Services The 18 boating facilities in Grey and Bruce have 2,051 slips and moorings of which 1,585 are seasonal slips and 466 dedicated transient slips. As shown in Figure 2 following, Port Elgin Harbour Marina compares favourably with the area boating facilities in terms of the amenities and services that are provided. The lack of slips longer than 40 feet is a concern given the projected growth in the number of boats of this length over the next twenty year period, as is the lack of 50 amp power at the docks which all of these boats now require. Only three other facilities have docks of this length. The advantage to Port Elgin is that it has a basin of sufficient size to provide longer slips whereas many of the 5

26 competitive facilities do not. On site repair services and laundry facilities are nice to have but not essential. Figure 2 Amenities and Services at Boating Facilities in Bruce and Grey Counties Amenities and Services at 18 Marinas in Bruce & Grey Counties Number of Marinas Amenities and Services at Port Elgin Harbour (Not at Port Elgin Harbour) Amenities and Services at 18 Marinas in Grey & Bruce Number of Marinas Amenities and Services at Port Elgin Harbour (Not at Port Elgin Harbour) 6

27 Kit-Wat Marina in Sauble Beach, Wiarton Town Docks, Owen Sound City Docks East and West, and Meaford Harbour Docks cater exclusively to transient boaters. Lion s Head Marina is the only marina with seasonal slips but catering predominately to transient boaters with 150 of its 213 slips dedicated to this market. 154 of the slips in Bruce and Grey Counties are 20 feet in length; 129, 21 feet to less than 26 feet; 274, 26 feet to less than 30 feet; 800, 30 feet to less than 36 feet; 225, 36 feet to less than 40 feet; 394, 40 feet to less than 46 feet; and 75, 46 feet or more in length. Only three marinas (i.e. Wiarton Marina, Georgian Shores Marina in Owen Sound, and Meaford Marina) have slips 46 feet or more in length although Port Elgin Harbour, Wiarton and Owen Sound have walls/piers in excess of 100 feet (EXHIBIT 1A). Twelve of the facilities have a launch ramp, 11 a fuel dock offering gas and diesel fuel, and 10 have a pump out. Seven of the facilities have permanent on-site haul out/lift capacity, 5 have a chandlery or marine supply store, and 3 offer on-site repair services (i.e. Wiarton Marina, Georgian Shores Marina, Cliff Richardson Boats in Meaford). Repair services can be arranged at three other facilities including Port Elgin Harbour, Big Tub Harbour Resort in Tobermory and Lion s Head Marina. Only four of the facilities including Port Elgin Harbour, Kit-Wat Marina, Big Tub Harbour Resort, and Georgian Yacht Club in Owen Sound offer on-site food service. Nine of the facilities including Port Elgin Harbour provide washrooms and showers. Three, Kit-Wat Marina, Sauble River Marina, and the Wiarton Town Docks provide washrooms only, and three, Georgian Shores Marina, Meaford Municipal Marina and Cliff Richardson Boats provide washrooms, showers, and laundry. There are a total of 137 slips with 50 amp power within the two Counties at Kincardine Marina, Little Tub Harbour Municipal Docks in Tobermory, Wiarton Marina and Meaford Municipal Marina. Approximately 23 percent of the slips (i.e. 467) are unserviced, of which 347 are at four facilities including Port Elgin Harbour, Lion s Head Marina, Georgian Shores Marina, and Meaford Municipal Marina. Eleven facilities including Port Elgin Harbour offer WiFi service and 10 including Port Elgin Harbour have pump out service. Winter storage is provided at 9 of the 18 facilities (including Port Elgin Harbour) but only Georgian Shores Marina and Cliff Richardson Boats provide both outdoor and indoor storage (EXHIBIT 1B). 2.3 Seasonal and Transient Slip Users During the 2016 boating season 90.9 percent of the 1,585 seasonal slips were occupied. Anything over 95 percent is considered full occupancy by industry standards. Low demand for un-serviced slips and demand beyond capacity for slips 40 feet and longer were cited as the reason for un-occupied slips during the 2016 season. While no numbers were available, five of the facilities have active waiting lists all for slips 36 feet or longer. Power boats (i.e. 844) accounted for 58.6 percent of the occupied slips in 2016 with 597 sail boats filling the other slips (EXHIBIT 1C). The 466 transient slips hosted 11,700 transient boaters, with Saugeen Shores, Tobermory, Lion s Head, Wiarton and Owen Sound receiving the most visits. The average length of stay was 1 day. 2.4 Comparison of Port Elgin Harbour s Boating Facilities with Bruce and Grey Counties As shown in Table 2 following, the 2016 occupancy rate for seasonal slips at Port Elgin Harbour was below that of the combined facilities in Bruce and Grey Counties. On the other hand, Port Elgin Harbour attracted 7.7 percent of the total transient boater visits to the two Counties without having dedicated transient slips. Seasonal and transient boaters at Port Elgin Harbour are better served than the other facilities in Bruce and Grey in terms of having a fuel dock, pump out service, launch ramp and on-site winter storage. At the same time, as highlighted in yellow in Table 2, seasonal boaters at Port Elgin Harbour appear to be less well served than those in Grey and Bruce Counties in terms of size of slips, serviced slips and adequate power. Port Elgin Harbour has almost twice as many un-serviced slips as those in the two counties (i.e. 42.5% vs. 22.8% respectively). Port Elgin Harbour has more than twice as many slips less than 26 feet than the other facilities (i.e. 33.6% vs. 13.8% respectively) and proportionately fewer slips 36 feet to less than 46 feet (i.e. 21.6% vs. 30.2%) and 7

28 46 feet and longer (i.e. 0% vs. 3.6%). While only 6.7 percent of the slips in the two counties have 50 amp power, there are none available at Port Elgin Harbour. Our interviews with the other marinas indicated that three are considering adding 50 amp power to a number of their slips. The percentage of slips 26 feet to less than 30 feet, 30 feet to less than 36 feet, and slips with 30 amp power at Port Elgin Harbour is similar to those in Bruce and Grey Counties. Table 2 - Boating Facilities at Port Elgin Harbour Compared with Bruce and Grey Counties Port Elgin Harbour Bruce and Grey Counties Number of Seasonal Slips Seasonal Slips Occupied % 1, % Dedicated Transient Slips as Percentage of Total Slips 0% 22.7% Percentage of Overall Transient Visits 7.7% 100% Percentage of Slips <26 feet 33.6% 13.8% Percentage of Slips 26 feet to <30 feet 9.0% 13.4% Percentage of Slips 30 feet to <36 feet 35.8% 39.0% Percentage of Slips 36 feet to <46 feet 21.6% 30.2% Percentage of Slips 46 feet and over 0% 3.6% Percentage of Facilities with Fuel Dock 100% 61.1% Percentage of Facilities with Pump Out 100% 55.6% Percentage of Facilities with Launch Ramp 100% 66.7% Percentage of Total Slips Un-serviced Slips 42.5% 22.8% Percentage of Slips with 30 amp Power 57.5% 59.8% Percentage of Slips with 50 amp Power 0% 6.7% Percentage of Facilities with on-site Winter Storage 100% 50.0% 2.5 Comparison of Port Elgin Harbour s Rates and Fees with Bruce and Grey Counties We have compared the rates and fees charged at Port Elgin Harbour during the 2016 boating season with those at 8 marinas in Bruce and Grey Counties offering the same facilities and services (EXHIBIT 2). These services include: Slip with at least 30 amp power and water; Un-serviced slip; Pump out service; Transient slip; Launch ramp; Haul-out or launch; and, Winter storage. Table 3 following indicates that the rates and fees at Port Elgin Marina are in the upper to upper middle range compared to other facilities in Bruce and Grey. Table 3 Comparison of Rates and Fees in Bruce and Grey Slip with Service Unserviced Slip Pump Out Daily Transient Fee Daily Launch Ramp Fee Haulout/ Launch Fee Outside Winter Storage Highest $ $91.00/ft. $59.80/ft. $20.00/tank $1.95/ft. $15.00 $13.25/ft. $52.90/ft. Lowest $ $48.19/ft. $42.50/ft. $14.70/tank $1.50/ft. $5.00 $6.67/ft. $8.64/ft Port Elgin Harbour Marina $65.91/ft. $59.80/ft. $14.70/tank $1.82/ft. $8.85 $10.00/ft. $8.72/ft. Source: EXHIBIT 2 The following paragraphs provide a detailed indication of the facilities with the highest and lowest rates and fees for each of the services indicated in Table 3. Wiarton Marina has the highest seasonal slip rental at $91.00 per linear foot, followed by Thornbury Harbour at $69.11, and Port Elgin Harbour Marina 8

29 at $65.91, and Kincardine Marina the least expensive at $48.19 per linear foot. Port Elgin s seasonal slip fee is approximately 2 percent above the average of $64.67 for the eight facilities. Port Elgin Harbour Marina has the highest fee for an un-serviced slip at $59.80 per linear foot, followed by Meaford Municipal Marina at $52.00, and Wiarton Marina the lowest at $42.50 per linear foot (EXHIBIT 2). Only two of the facilities provided summer land storage fees: Port Elgin Harbour Marina through the Port Elgin Harbour Yacht Club has an off-site cradle storage fee of $25.00 and Georgian Shores Marina in Owen Sound has a summer dry land storage fee for boats of $18.33 per linear foot. Pump out charges range from a high of $20.00 per tank at Little Tub Harbour Municipal Docks in Tobermory, Lion s Head Marina, and Georgian Shores Marina to a low of $14.70 per tank at Port Elgin Harbour Marina. Daily pump out charges at Port Elgin Harbour Marina are approximately 21 percent below the average of $17.82 for the eight facilities. Thornbury Harbour has the highest daily transient boater fees at $1.97 per linear foot, followed by Meaford Municipal Marina at $1.95 and Port Elgin s $1.82 per linear foot. Kincardine Marina and Georgian Shores Marina offer the lowest daily transient fees at $1.50 per linear foot. Port Elgin Harbour Marinas transient boater fees are approximately 5 percent higher than the average of $1.73 per linear foot per day. Georgian Shores Marina has the highest day use fees for their launch ramp at $15.00, followed by Little Tub Harbour Municipal Docks, Lion s Head Marina, and Wiarton Marina at $ The lowest fees are charged at Meaford Municipal Marina (i.e. $5.00), and Thornbury Harbour at $6.64 per use. Port Elgin Harbour Marina at $8.85 is approximately 13 percent below the average for the eight facilities. The $10.00 per linear foot charged by the Port Elgin Harbour Yacht Club for haul out and launch is virtually the same as the average of $9.98. Kincardine Marina at $8.64 per linear foot, and Cliff Richardson Boats in Meaford is the highest at $13.25 per linear foot. Winter boat storage fees vary widely from a low of $7.70 per linear foot for a seasonal slip holder at Little Tub Harbour Municipal Docks and Lion s Head Marina to a high of $52.90 per linear foot for outdoor storage at Cliff Richardson Boats. Georgian Shores Marina charges $23.00 per linear foot for outdoor winter storage. Excluding the two highest, the average for the five facilities charging by the linear foot is $8.45. At $8.72 per linear, Port Elgin Harbour Marina is approximately 3 percent above the average and Kincardine Marina at $8.64, approximately 2 percent above. As a further analysis of the rates charged within Bruce and Grey Counties we undertook to compare them based on 17 facilities and services 1 considered by boaters to be the most desirable features in a marina (EXHIBIT 3). 2 Each of the marinas was evaluated based on features and values. Where a marina had a feature or service, but it was considered in need of improvement a lesser value was assigned (i.e. 4 rather than 5 for docks, 2 rather than 3 for a launch ramp) (EXHIBIT 4). Based on this assessment no marina received the maximum 62 point facility rating. Wiarton Marina and Georgian Shores Marina received the highest score of 59, followed by Kincardine Marina at 56. Port Elgin Harbour received a score of 55 the third highest. Wider main and finger docks and more stable finger docks at the north end of the harbour; better security gates and use of webcam at the north end; and improved WiFi service will increase this score (Table 4 following). 1 Safe piers, main & fingers docks; Vehicle parking; Washrooms; Water service on docks; Haul-out, launch & winter storage; Hydro (30 amps.) on docks; Security 24 hours; Pump out service; Fuel dock; Wi fi connection; Staff available for assistance; Launch ramp; Clean marine certification; Repair services; Marine supplies; Mast crane; Laundry facilities boat owners were interviewed at the Toronto International Boat Show between January 9 and 17, 2016 regarding the features they felt were most desirable at a home marina. They were then asked to rate each feature on a scale of 1 to 5, with 5 being the most desirable. We were not allowed to ask for any personal information, nor did we ask them to identify their home marina. 9

30 Figure 3 Comparison of Marinas in Bruce Grey Based on 17 Facilities and Services Facility Rating Score for Marinas in Bruce and Grey Georgian Shores Marina Wiarton Marina Kincardine Marina Port Elgin Harbour Marina Thornbury Harbour Cliff Richardson Boats Little Tub Harbour Municipal Docks Lion s Head Marina Meaford Municipal Marina Big Tub Harbour Resort Facility Rating Score (maximum 62) Source: EXHIBIT 4 Table 4 - Evaluation of Port Elgin Harbour s Boating Facilities Facility Facility Rating Missing or Features in Need of Improvement Port Elgin Harbour Marina 55 Docks at north end of harbour in need of improvement; No 24 hour security; No laundry facilities; WiFi is inconsistent; No on-site repair services but can be arranged; Limited marine supplies available Source: EXHIBIT 3 and Annual Rate Increases Our interviews with marina operators throughout Bruce and Grey Counties indicated that annual rate increases are typically held to three to four percent due to the highly competitive nature of the market place and the fear of losing boaters if rates are increased too much in one season. Within the past two years these increases have held to two to three percent. Since there are no indications that marina operating costs will decrease in the future, it is expected that rates will continue to rise in the two to four percent range annually. One-time increases above three to four percent do occur when additional revenue is required for capital improvements. The rate increases at Port Elgin Harbour between 2013 and 2015 were above the area average while those for 2016 were in line with the area facilities (EXHIBIT 5). Kincardine Marina conducts an annual survey of rates at area marinas and sets their rates in the middle which has the approval of Council. Thornbury Harbour uses the Bank of Canada Consumer Price Index (CPI) as a minimum in setting their annual rates. When above normal increases in rates are necessary, it is good business practice to inform the long-term boaters as to the reason for this need (i.e. unusually high dredging costs, winter storm damage, major infrastructure improvements, etc.). It also has to be realized that operating marinas is a business and businesses at worst are expected to break-even but more realistically are expected to be revenue-positive. An annual capital reserve for replacement of 10 to 12 percent of gross revenue when possible is generally sufficient to cover major capital improvements within the 20 to 10

31 25 year life cycle of the marinas major infrastructure features and should be included in all marina and harbour budgets. 2.6 Seasonal Slip Occupancy at Port Elgin Harbour Marina As shown in Table 5 following, the occupancy rate of slips 30 feet or more in length is equal to or exceeds the overall occupancy rate for all boating facilities in Bruce and Grey (i.e. 90.9%). On the other hand those less than 30 feet have historically fallen below that required to make the marina financially profitable (i.e. 85%). Given the current and projected growth of larger boats in the seasonal and transient market place consideration should be given to reducing the number of slips under 30 feet and increasing the number 30 feet and over. Table 5 Summary of Seasonal Slip Occupancy Dock Type Length (ft.) Service Provided B Power 32 to 40 Hydro & Water 92% 92% 92% 95% 90% 92% C Power 32 to 40 Hydro & Water 100% 100% 92% 95% 90% 95% H Sail 30 Hydro & Water 100% 100% 100% 100% 100% 100% G Mix 20 to 30 Hydro & Water partial 95% 100% 74% 84% 82% 80% F Mix 24 to 28 None 63% 77% 58% 53% 55% 52% I Mix 20 None 88% 93% 60% 68% 72% 70% Total 88% 92% 76% 79% 78% 78% By industry norms considered profitable By industry norms not considered profitable 2.7 Assessment of Infrastructural Features at Port Elgin Harbour The conditions of the existing facilities at Port Elgin Harbour were reviewed. The review was limited to a visual assessment of the facilities and observations of their function and boater use (EXHIBIT 7A and 7B). No surveys, measurements or testing of the structures were undertaken. The review did not include buildings or club houses. The descriptions of the docks in EXHIBITS 7A AND 7B are provided separately for the south, north and west parts of the basin. The entrance is considered to be the dividing line between north and south. The west docks are those attached to the north breakwater. Fuel pumps and dock were not in place during our site visit and no assessment is provided at this time. Comments with respect to adequacy of fairways are based on a review of aerial photography. A fairway twice the length of a boat using the adjacent dock is considered good and a fairway width of one and onehalf of the length of the boat is considered adequate. Water depth requirements depend on boat mix but generally water depths of 1.8 metres are considered adequate for public marinas. Chart datum is taken as reference water level. Comments with respect to stability of docks are based on experiences during site visits and comments received from boaters and may be considered somewhat subjective. Comments regarding launch ramp parking follow published recommendations that suggest 40 car/trailer combination parking spaces are required per launch lane. However, it is recognized that demand for parking varies from location to location and by time of day. 11

32 12

33 SECTION 3 TRENDS IN RECREATIONAL BOATING AND MARINAS 3.0 Introduction The profile of boaters and the use of their boats have changed significantly over the past decade and all indications are that they will continue to do so in the future. Previously it was not unusual to go out on the boat for the better part of at least one day on the weekend and a couple of evenings during the week. Today s work and family commitments place numerous demands on one s time, and the result is that most boats are actually being used less and less. Many marina operators have told us that 40 percent or more of their seasonal boaters never take their boat out of the slip during the boating season. Years ago boaters wanted to escape from the hectic day-to-day issues by taking the boat out with a cooler, some sandwiches and favourite eats and drinks. Today s boaters still want to escape, but want to bring it all with them a refrigerator, hot-tub, air conditioning, television, WiFi, cell service and lots more. And yet time aboard is becoming less and less. Less than a decade ago the trending range for recreational boats was from 30 to 40 feet. Today, the typical demand is for much larger vessels (i.e. 46 feet and over) and smaller boats (i.e. 24 to 28 feet). Boats have been getting longer, wider and deeper and have more things on-board that require power. 30 and 50 amp service is the standard for average marinas today, and it can range to 100 to 200 amps for larger sized boats. The change in how boats are used affects every aspect of the boating industry with one common theme ease of use combined with comfort. For marinas and yacht clubs, this means providing and maintaining sturdier and more spacious docking facilities, deeper water depths, upgraded physical appearances, more attractive restrooms, upgraded electricity for boats, better lighting, and usually more and/or upgraded amenities. The boating population is basically of two components: a) those who have been in boating for some time and are continuing (and that pool is growing older and shrinking see sub-section 3.1 following); and b) those who have never been in boating or not for a long time. The new population is even more demanding and has higher expectations in terms of use and enjoyment. When these are compromised, the desire to stay in boating is dramatically challenged. The cost of entry and use for boating are rising faster than inflation. Low cost, entry-level boats are scarce. The boating industry and marinas need to continue to seek ways of attracting new boaters. 3.1 Boater Profile In 2012, 14.5 percent of Ontario s population 16 or over participated in boating. 1 The participation rate by males (i.e. 15.8%) is only slightly higher than that for females (i.e. 13.3%). For both males and females the highest participation rate is in the 35 to 44 and 45 to 54 age groups (i.e. 22.9% and 19.0% respectively for males and 18.9% and 16.3% respectively for females) (Figure 4). Power and sail boaters are represented in all levels of attained education, although those with some university education and those with a university degree are the highest at 21.2 and 25.5 percent respectively. While boating also appeals to all employment categories, those employed in professional, administrative and managerial, and skilled labour positions have the highest participation rates at 28.8 percent and 24.6 percent respectively. The largest number of boaters come from households earning $40,000 to $74,999, although the highest participation rate is within those from households earning $100,000 or more. Between 2000 and 2015, the age of the average new boat buyer has increased from 45 to 53. During that same time period the percentage of new-boat buyers under 40 has shrunk by nearly one-half (Figure 5). 1 Statistics Canada, General Social Survey and Ontario Ministry of Tourism, Culture and Sport 13

34 Figure 4 - Boating 1 Participation in Ontario Percentage of any group age 16 or over that participated in boating at any time in 2012 Boating Motor Boating Sailing 3.6% 10.8% 14.5% Males Boating Motor Boating Sailing 3.7% 11.8% 15.8% 16 to to to to to % 14.7% 16.6% 17.8% 19.0% 22.9% Females Boating Motor Boating Sailing 3.4% 9.8% 13.3% 16 to to to to to % 12.5% 15.4% 16.3% 14.1% 18.9% 0% 5% 10% 15% 20% 25% 1 Includes in-board and out-board motor boating and sailing, excludes canoeing, kayaking and motorized personal watercraft 14

35 Figure 4 - Boating Participation in Ontario (Continued) Percentage of any group age 16 or over that participated in boating at any time in 2012 Non High School Graduate High School Graduate Some University University Graduate All Others 11.5% 14.6% 15.2% 21.2% 25.5% Professional/Admin Clerical/Sales Skilled Non-Skilled 19.7% 19.9% 24.6% 28.8% Under $20,000 $20,000 to $39,999 $40,000 to $74,999 $75,000 to $99,999 $100, % 12.9% 19.2% 28.7% 32.6% 0% 5% 10% 15% 20% 25% 30% 35% Source: Statistics Canada, General Social Survey and Ontario Ministry of Tourism, Culture and Sport 15

36 Figure 5 New Boat Buyer Age Distribution Age Distribution of Canadian New Boat Buyer's Percentage of Total <25 25 to to to to to to to to to to Age Buyers in 2000 Buyers in 2015 Source: National Marine Manufacturers Association, Boating Industry Magazine 3.2 Socio-demographic Characteristics of Port Elgin Harbour s Seasonal Boater Market There are 13,715 persons living in Saugeen Shores, 68,147 in Bruce County and 826,027 in the three areas (i.e. Bruce and Wellington Counties and the Regional Municipality of Waterloo) accounting for 80 percent of seasonal boaters at Port Elgin Harbour Marina in It is evident when looking at the sociodemographic characteristics that have the highest propensity to participate in boating (e.g. occupation and, household income) that the Town of Saugeen Shores and the two counties and one regional municipality are a strong market for power and sail boating participation. Among males 35 to 44, the age group with the highest participation in boating (i.e. 22.9%), Saugeen Shores and the counties with the highest potential are under-represented when compared to the province (i.e. 9.7% and 13.6% respectively, compared to 15.8% for Ontario. The second highest participation rate among males falls in the 45 to 54 year age category (i.e. 19.0%); in this case all three areas are close to or over-represented when compared to the province (i.e. 15.1%, 15.7%, 15.6% and 15.3% respectively) (EXHIBIT 8 and Figure 4). A similar pattern occurs with the proportion of females compared to the province. The proportion of the female population within all three areas is under-represented compared to the province (i.e. 9.6%, 9.9%, 13.6% and 15.7% respectively) in the 35 to 44 age group which has the highest participation rate in boating (i.e. 18.9%). Females in the 45 to 54 age group, the category with the second highest participation rate in boating (i.e. 16.3%) are over-represented in all three areas when compared to the province with Saugeen Shores being the most over-represented (i.e. 15.9% vs. 15.3%), followed by Bruce County (i.e. 15.8%) and the counties with the highest potential for boating at the marina (i.e. 15.5%). It is significant that both males and females are overrepresented in the age category with the highest percentage of new boat purchases. 16

37 Occupation is a socio-demographic characteristic that is also a strong determinant of participation in boating. Within Saugeen Shores there are proportionally more individuals in professional/managerial/ administrative occupations (i.e. 59.2%, compared to the province s 56.9%), the occupation category with the highest participation level in boating (i.e. 28.8%). The counties with the highest potential are only slightly under-represented at 55.2 percent when compared to the province. Skilled labour persons who have the second highest participation rate in boating (i.e. 24.6%) are over-represented in Bruce County and the three counties with the highest potential (i.e. 25.9% and 22.7% respectively) compared to 18.3 percent in Ontario. Household income is the strongest determinant for participation in boating. Median household income in Saugeen Shores is 22.7 percent higher than the province (i.e. $81,410 versus $66,358). In the counties with the highest potential the median household income ($69,967) is 5.4 percent higher than the province. Within the income group $75,000 to $99,999; which has the second highest participation rate in boating (i.e. 28.7%), all three areas are over-represented: Saugeen Shores by 3.7 percent, Bruce County by 2.5 percent and the counties with the highest potential by 4.1 percent (i.e. 15.3%, 14.1%, and 15.7% respectively compared to 11.6% for Ontario). Households with an average income of $100,000 or more have the highest participation rate in power and sail boating at 32.6 percent. In this case, all three areas are well over-represented when compared to the rest of Ontario, with Saugeen Shores at 39.3 percent, Bruce County at 29.9 percent, and the three counties with the highest potential at 30.8 percent compared to the province s 21.3 percent. The strength of the socio-demographic characteristics with a high propensity for recreational boating in the seasonal boater market area of Port Elgin Harbour suggests that there is sufficient recreational boater demand to satisfy all of the marinas in Bruce County, it is a matter of attracting the boaters with the appropriate price points and facilities and amenities most sought after by the seasonal boaters. Of particular note is the fact that Saugeen Shores has a higher percentage of its population than the Province in professional/managerial/administrative occupations, median household income, and household income $75,000+ which are three of the socio-demographic characteristics with the highest propensity for participation in recreational boating 3.3 Projected Population of Areas with Highest Potential for Seasonal Boaters 2017 to 2037 There are no data available other than by age and gender characteristics which project the population of the seasonal market area over the next twenty year period. Therefore we have used the Ontario Ministry of Finance s, Ontario Population Projections Update, , Spring 2016 data to arrive at projections for each year (EXHIBIT 9). The population of the three areas with the highest potential for generating seasonal boaters to Port Elgin Harbour Marina 25 and older 1 is projected to increase from 597,934 in 2017 (294,343 males, 303,591 females), to 641,158 by 2022 (316,148 males, 325,010 females), to 678,209 by 2027 (334,371 males, 343,838 females), to 713,558 by 2032 (350,345 males, 363,213 females), and reach 747,824 by 2037 (366,635 males, 381,189 females), (Figure 6). This represents a 25 percent increase in the population between 2017 and From 2017 to 2037 the number of males and females 45 to 54 (i.e. second highest participation rate in boating and highest percentage of new boat buyers) will decrease slightly from 59,275 males and 58,649 females in 2017 to 57,928 males and 56,138 females in 2027 and then increase to 62,424 males and 59,622 females in 2032 and reach 67,805 males and 64,767 females by This suggests that there may be a weakening in seasonal slip demand during the period from 2017 to 2027, prior to an increase in demand above the 2017 levels, beginning in 2028 and continuing until at least It will be important that the management of Port Elgin Harbour Marina increase their efforts to maintain the existing seasonal slip holders during the period of potential decreased new demand. 1 Very few power or sail boats are owned by those under 25 years of age 17

38 Figure 6 - Population Projections 2017 to 2037 (25 and over) for Areas with Highest Potential 1 140,000 Population 25 Years and Older 120, ,000 80,000 60,000 40,000 20,000 0 Male Female Male Female Male Female Male Female Male Female Year 25 to to to to Includes Bruce County, Wellington County, Regional Municipality of Waterloo Note: An analysis of postal codes indicated that 80 percent of seasonal boaters at Port Elgin Harbour from 2014 to 2016 were from Bruce and Wellington Counties and Regional Municipality of Waterloo. These represent three high potential areas for continued seasonal boater use at Port Elgin Harbour. Note: Few boats are owned by those under 25, and the 25 to 64 age group categories have the highest participation in power and sail boating. A further analysis of postal codes indicated that 15 percent of seasonal boaters at Port Elgin Harbour from 2014 to 2016 were from Grey, Perth, and Middlesex Counties; Halton and Peel Regions; and Metropolitan Toronto. These represent six areas with some potential for continued seasonal boater use at Port Elgin Harbour Marina (EXHIBIT 10). The population of the six areas with some potential for generating seasonal boaters to Port Elgin Harbour Marina 25 and older is projected to increase from 2,246,732 in 2017 (1,083,477 males, 1,163,255 females), to 2,443,943 by 2022 (1,185,937 males, 1,258,006 females), to 2,613,058 by 2027 (1,274,012 males, 1,339,046 females), to 2,774,757 by 2032 (1,354,790 males, 1,419,967 females), and reach 2,932,976 by 2037 (1,430,464 males, 1,502,512 females), (Figure 7). This represents a 30 percent increase in the population between 2017 and During this same period the population of Ontario 25 and older is projected to increase by 26 percent from 10,103,381 (4,872,348 males, 5,231,033 females) in 2017 to 12,751,863 (6,156,040 males, 6,595,823 females) in 2037 (EXHIBIT 11). While the projected population growth rates in the areas of highest potential will match that of Ontario (i.e. 25% vs. 26%) those in the areas generating some potential will exceed the provincial growth rate (i.e. 30% vs. 26%) suggesting there may be increased potential to attract seasonal boaters from Grey, Perth, and Middlesex Counties; Halton and Peel Regions; and Metropolitan Toronto. 18

39 Figure 7 - Population Projections 2017 to 2037 (25 and over) for Areas with Some Potential 1 500, ,000 Population 25 Years and Older 400, , , , , , ,000 50,000 0 Male Female Male Female Male Female Male Female Male Female Year 25 to to to to Includes Grey County, Perth County, Middlesex County, and northern half of Halton Region, Peel Region, Metropolitan Toronto Note: An analysis of postal codes indicated that 15 percent of seasonal boaters at Port Elgin Harbour from 2014 to 2016 were from Grey, Perth, and Middlesex Counties; Halton and Peel Regions; and Metropolitan Toronto. Occupancy rates on the western end of Lake Ontario are extremely high and waiting lists are long. As a result, sail and power boaters in the northern parts of Halton, Peel and Toronto are looking to other more distant marinas and harbours to moor their boats. These represent six areas with some potential for continued seasonal boater use at Port Elgin Harbour. Note: Few boats are owned by those under 25, and the 25 to 64 age group categories have the highest participation in power and sail boating. The remaining 5 percent of seasonal boaters at Port Elgin Harbour Marina from 2014 to 2016 were from Huron, Oxford, and Dufferin Counties and the northwestern half of Hamilton. EXHIBIT 12 provides the population projections for these four areas with low potential for generating seasonal boaters for the marina. 3.4 Projected Growth in Boating Activities Between 2010 and 2035 participation in power boating, sailing, canoeing, kayaking and rowing are all projected to increase. It should be noted however, that the increases in power boating and sailing are much slower than those of the other activities. There are no comparable projections available for outrigger canoeing, dragon boat racing, paddle boating, and stand up paddle boarding, although anecdotal information based on the increased number of members at area clubs suggests that participation in these activities is also in a growth mode. 19

40 Based on data provided by Statistics Canada, General Social Survey and Ontario Ministry of Tourism, Culture and Sport (Figure 8) participation in power boating, sailing, canoeing, kayaking and rowing is projected to increase over the 25 years between 2010 and 2035 as shown in Table 6. Table 6 Participation in Boating Activities Activity Power Boating 10.8% 11.3% 12.0% 12.3% 12.6% 12.8% Sailing Canoeing Kayaking Rowing As a result of the increased interest in canoeing, kayaking, rowing, outrigger canoeing, dragon boat racing, paddle boating, and stand up paddle boarding, many marinas are striving to accommodate these types of boating activities. Rental of small non-motorized watercraft has become an additional revenue source for a number of marinas in Ontario. Figure 8 - Projected Growth in Percentage of Ontario s Population Participating in Selected Boating Activities Percentage of Population 16 or over Participating Year Power & Sail Boating Power Boating Sailing Canoeing Kayaking Rowing Source: Statistics Canada, General Social Survey; Ontario Ministry of Tourism, Culture and Sport During the next twenty year period the age profile of power and sail boaters in the area with the highest potential for seasonal boaters for Port Elgin Harbour Marina will change dramatically as the number of boaters 65 and over increases from 9,320 in 2017 to 17,310 by 2037 and the number 25 to 34 increases from 16,550 in 2017 to 17,220 by 2023, then decreases to 14,920 by 2032, before increasing to 16,510 by 2037 (Figure 9, following). With the increased number of older power and sail boaters it will be important for Port Elgin Harbour Marina and other marinas to provide wider and more stable finger docks. 20

41 Figure 9 Projected Growth in Power and Sail Boaters by Age Group in Areas with Highest Potential Number of Power and Sail Boaters to to to to Overall, the number of male and female power and sail boaters will increase from 80,590 in 2017 to 94,290 by 2037 with a slight decrease between 2027 and 2030 (Figure 10). Figure 10 Projected Annual Growth in Power and Sail Boaters in Areas with Highest Potential 95,000 Number of Power & Sail Boaters 90,000 85,000 80,000 75,000 70,000 Year 21

42 3.5 Historical Number of Boats by Length, Beam, and Draft, 2011 to 2016 Since 100 percent of the market for seasonal slips and moorings at Port Elgin Harbour Marina comes from Ontario and over 95 percent of the market for transient slips comes from Ontario, Michigan and Ohio, we have concentrated our analysis regarding the number, length, beam and draft of these boats on these three geographic areas. Also, since few boats under 20 feet (i.e. 6 metres) venture onto the Great Lakes for any extended period of time, primarily for safety reasons, and there is a high propensity to trailer boats under 26 feet (i.e. 8 metres) in length to launch ramps for their use rather than occupying a marina slip or moorage, we have concentrated our analysis on those boats 26 feet or longer. As shown in EXHIBIT 13, in 2016 there were approximately 53,860 registered power and sail boats of this size in Ontario, 39,800 in Michigan, and 22,450 in Ohio. It should be noted however, that all of the EXHIBITS used in this analysis do provide numbers for boats 20 feet and less (i.e. 6 metres or less). The number of boats under 26 feet has increased an average of 0.5 percent per annum in Ontario, -0.5 percent in Michigan, and 2.2 percent in Ohio. Boats 26 feet or more on the other hand have increased 3.2 percent per annum in Ontario between 2011 and Those in New York have increased an average of 2.2 percent each year between 2008 and 2013, and those in Ohio 3.6 percent each year.. Our interviews with government officials, boat manufacturers and marina owner/operators in Ontario, Michigan and Ohio indicate that the stronger economic growth in Canada until 2008 and confidence in a return to a stronger economy in 2011 and 2012 after the downturn of were the reasons why Ontario boaters bought larger boats as first time buyers or traded-up for larger boats as repeat buyers at a faster rate than those in Michigan. Our interviews with U.S. officials did indicate there are positive signs for an economic recovery in Michigan State beyond Boat manufacturers and boaters also tell us that the movement toward bigger boats results from a movement away from cottage ownership. Larger boats in some cases have as many staterooms as cottages have bedrooms. The typical drive to a cottage in Ontario is 1½ to 2 hours whereas to a seasonal slip it is normally 30 minutes or less Length The length or length overall (LOA) is the maximum length of the boat s hull measured parallel to the waterline. It is the most commonly used way of expressing the size of a boat, and is used for calculating the cost of a marina slip lease. The number of boats 20 feet to less than 26 feet (i.e. 6 metres to less than 8 metres) has increased 0.8 percent per annum between 2011 and 2016 in Ontario, decreased 1.3 percent per annum in Michigan, and increased 2.4 percent per annum in Ohio (EXHIBIT 13). These are the boats that are typically used for fishing, water skiing and wakeboarding and are trailered to a launch ramp for each activity day. Boats 26 feet to less than 30 feet (i.e. 8 metres to less than 9 metres) have increased 1.1 percent per annum in Ontario, and 1.3 percent in Michigan, and 3.1 percent in Ohio. Those 30 feet to less than 36 feet (i.e. 9 metres to less than 11 metres) have increased 3.4 percent per annum in Ontario, 2.2 percent in Michigan, and 3.5 percent in Ohio. Boats 36 feet to less than 46 feet (i.e. 11 metres to less than 14 metres) have increased 4.1 percent per annum in Ontario and Ohio, and 1.8 percent in Michigan. Those boats 46 feet or more (i.e.14 metres or more) in length, increased 5.3 percent per annum in Ontario, 4.0 percent in Michigan and 3.7 percent per annum in Ohio. Our discussions with boating officials and marina owner/operators in Michigan indicated that the wealthier boaters owning the largest boats have been less affected by the poor economy in the state since Boats in these five size categories are the ones that are currently using the slips in Port Elgin Harbour Marina Beam The beam of a boat is its width at the widest point measured at the vessel s normal waterline. Within Ontario, Michigan, and Ohio there were 561,320; 398,380; and 243,730 power and sail boats respectively with a beam of 6 feet 6 inches to less than 10 feet (i.e. 2 metres to less than 3 metres); 25,310, 18,110 and 9,010 respectively from 10 feet to less than 13 feet (i.e. 3 metres to less than 4 metres); and 12,590, 22

43 11,710 and 5,090 respectively with a beam of 13 feet or more (i.e. 4 or more metres) in 2016 (EXHIBIT 14). Between 2011 and 2016, the number of boats in Ontario with a beam of 6 feet 6 inches to less than 10 feet saw an increase of 0.6 percent annually. Those with a beam of 10 feet to less than 13 feet increased 4.4 percent each year and those 13 feet and wider increased 4.6 percent per annum. The increase in the beam of boats in Michigan is less dramatic. Boats with a beam of 6 feet 6 inches to less than 10 feet decreased 0.4 percent per annum, while those 10 feet to less than 13 feet and 13 feet and wider increased by 2.7 percent and 3.1 percent each year. Although there are a smaller number of boats in Ohio the percentage increases in each of beam measurements was the largest over the period from 2011 to Boats 6 feet 6 inches to less than 10 feet increased an average of 2.3 percent each year. Those 10 feet to less than 13 feet increased 6.1 percent each year and those 13 feet and wider increased 6.2 percent per annum. What is clearly evident from these numbers is that boats are getting longer and wider and Port Elgin Harbour Marina will need to recognize this trend in order to maintain or possibly increase their share of the Ontario, Michigan and Ohio boater market Draft Draft is the vertical distance of a boat between the waterline and the bottom of the hull or keel in the case of a sail boat. Draft determines the minimum depth of water a boat can safely navigate. As boats have grown in length and beam (width) between 2011 and 2016, their draft has also increased though at a much more uniform rate than length and width. EXHIBIT 15 demonstrates that in Ontario the rate of annual increase for boats with a draft of 2 feet to less than 5 feet (i.e metres to less than 1.52 metres) was 0.6 percent per annum while Michigan showed a decrease of 0.4 percent per annum, and Ohio an increase of 2.3 percent per annum. Those boats in Ontario with a draft of 5 feet to less than 6 feet (i.e metres to less than 1.83 metres) and 6 feet or more (i.e metres or more) increased 1.8 percent and 2.3 percent each year respectively. Boats in Michigan exhibited the same 1.8 percent increase in the 5 feet to less than 6 feet, but only 0.9 percent each year with a draft of 6 feet or more. Ohio s boats increased 2.3, 2.5 and 2.6 percent per annum respectively in the 2 feet to less than 5 feet, 5 feet to less than 6 feet, and 6 feet or more of draft categories. EXHIBITS 17, 18 and 19 provide monthly statistics for the number of pleasure craft licenses granted, cancelled, and the total additional registered pleasure craft in Ontario between 2013 and Projected Number of Boats 2017 to 2037 Based on our discussions with boating officials and boat manufacturers/builders in Canada and the United States, we have projected that the total number of boats in Ontario less than 20 feet in length (i.e. less than 6 metres) will increase from approximately 1,011,800 in 2017, to 1,061,700 by 2037, an increase of 0.5 percent over that period. Those 20 feet to less than 26 feet (i.e. 6 metres to less than 8 metres) will increase from approximately 55,500 in 2017, to 57,000 in 2022, to 58,000 by 2027, to 58,600 by 2032, and reach approximately 59,200 by 2037, an increase of 6.7 percent over that period. Boats in Ontario 26 feet or more in length (i.e. boats that are typically keep at marinas or yacht clubs) are projected to increase from approximately 55,700 in 2017, to 65,500 in 2022, to 74,400 by 2027, to 82,900 by 2032, and reach approximately 91,000 by 2037, an average increase of 3.1 percent per annum (EXHIBIT 20). Our discussions with boating officials in Michigan, Ohio, and the National Marine Manufacturers Association (NMMA) in Chicago indicates that the total number of boats in Michigan 26 feet or more in length (i.e. 8 metres or more) will increase from approximately 40,200 in 2017, to 42,500 in 2022, to 44,200 in 2027, to 45,400 in 2032, and reach approximately 46,500 by 2037, an average annual increase of approximately 1.0 percent over that period (EXHIBIT 24). Ontario s growth in boats 26 feet or more in length is three times that of Michigan. In Ohio, boats 26 feet or more in length are projected to increase from approximately 22,800 in 2017, to 24,500 by 2022, to 26,100 in 2027, to 27,500 23

44 by 2032, and reach approximately 29,000 by 2037, an increase of approximately 1.4 percent per annum over that period (EXHIBIT 28). The growth rate in each category was derived from data available between 2011 and 2016 and the projections provided by boat manufacturers/builders in Canada and the United States for what they will sell between 2017 and 2037 and the number of boats that Transport Canada, Service Canada believes will be registered in Ontario and the number the Michigan Secretary of State, and Ohio Department of Natural Resources believes will be registered during the 2017 to 2037 time period Length of Ontario Boats Between 2017 and 2037 the number of boats by length in Ontario is projected to grow as follows: Table 7 Projected Growth in Ontario Boats by Length (2017 to 2037) Length % increase 20 ft. to <26 ft. (6 m. to <8 m.) 55,470 57,020 58,050 58,600 59, % 26 ft. to <30 ft. (8 m. to <9 m.) 13,320 15,150 15,920 16,540 17, % 30 ft. to <36 ft. (9 m. to <11 m.) 21,240 24,440 27,550 30,300 32, % 36 ft. to <46 ft. (11 m. to <14 m.) 13,360 16,050 18,840 21,490 24, % 46 ft. and over (14 m. or more) 7,800 9,820 12,060 14,490 17, % Source: EXHIBIT 20 This projected increased growth in the length of boats will have a particularly strong impact on the facilities in Bruce and Grey Counties where there is already a shortage of longer slips and a number of the fairways are sub-standard in terms of width. This shortage will be further exacerbated as there will be a need to modify the number of slips to accommodate wider beam widths. For those facilities that are currently using the entire water basin an increase in slips lengths and/or space between finger docks may mean a reduction in the overall number of slips provided. It will also have a particularly negative impact on those facilities with fixed docks. For Port Elgin Harbour Marina to continue to attract its fair share of seasonal boaters it will be necessary to increase the number of docks 36 feet to less than 46 feet and add docks that are 46 or more feet in length Beam of Ontario Boats The trend toward wider boats in the years 2011 to 2016 is also expected to continue for the period between 2017 and 2037 (EXHIBIT 21), as shown in Table 8 following. Facilities with already narrow slips will be negatively impacted by the increased growth in wider boats, especially those with fixed docks. Table 8 Projected Growth in Ontario Boats by Beam (2017 to 2037) Beam % increase 6 ft. 6 to <10 ft. (2 m. to <3 m.) 563, , , , , % 10 ft. to <13 ft. (3 m. to <4 m.) 26,470 33,260 42,300 53,480 65, % 13 ft. and over (4 m. or more) 13,190 16,720 21,480 27,550 34, % Source: EXHIBIT Draft of Ontario Boats Between 2017 and 2037 the draft of boats in Ontario is projected to grow as shown in Table 9 following. The projected increase in length and berth of boats does not mean a proportionate increase in the draft of the boats as boat designers are providing design features which create stability without significantly increasing the draft. Port Elgin Harbour Marina will not be adversely affected by the projected increase in the number of boats requiring more draft. 24

45 Table 9 Projected Growth in Ontario Boats by Draft (2017 to 2037) Draft % increase 3 ft. to <4 ft. (0.91 m. to <1.22 m.) 135, , , , , % 4 ft. to <5 ft. (1.22 m. to <1.52 m.) 29,550 32,030 34,480 36,980 39, % 5 ft. to <6 ft. (1.52 m. to <1.83 m.) 2,630 2,930 3,240 3,580 3, % 6 ft. or more (1.83 m. or more) 1,280 1,450 1,650 1,930 2, % Source: EXHIBIT Length of Michigan State Boats Michigan officials are indicating that the economy in the state is projected to slowly improve during the next decade leading to an increase in the number of boats purchased in the state. This should mean an increase in the number transient boaters from the state capable of visiting facilities on the Ontario side of Lake Huron. The boats most likely to visit Port Elgin Harbour Marina are those with the highest projected growth rates as shown in Table 10. Table 10 Projected Growth in Michigan State Boats by Length (2017 to 2037) Length % increase 20 ft. to <26 ft. (6 m. to <8 m.) 30,140 30,290 30,430 30,520 30, % 26 ft. to <30 ft. (8 m. to <9 m.) 9,420 9,550 9,600 9,650 9, % 30 ft. to <36 ft. (9 m. to <11 m.) 11,880 12,550 13,110 13,490 13, % 36 ft. to <46 ft. (11 m. to <14 m.) 12,230 12,810 13,270 13,540 13, % 46 ft. and over (14 m. or more) 6,710 7,570 8,180 8,770 9, % Source: EXHIBIT Beam of Michigan State Boats Boats in Michigan with the narrowest beam (i.e. 6 feet 6 inches to less than 10 feet) are projected to increase slightly by 2.0 percent between 2017 and Those with the widest beam (i.e. 13 ft. and over) are projected to increase 20.8 percent as noted in Table 11 below. Table 11 Projected Growth in Michigan State Boats by Beam (2017 to 2037) Beam % increase 6 ft. 6 to <10 ft. (2 m. to <3 m.) 398, , , , , % 10 ft. to <13 ft. (3 m. to <4 m.) 18,140 18,460 19,340 19,490 19, % 13 ft. and over (4 m. or more) 11,740 11,990 12,830 13,620 14, % Source: EXHIBIT Draft of Michigan State Boats As with boats from Ontario, the projected increase in the draft of boats will not adversely affect their ability to visit Port Elgin Harbour Marina. Boats with a draft of 5 feet to less than 6 feet (i.e metres to less than 1.83 metres) are projected to increase the most between 2017 and Table 12 Projected Growth in Michigan State Boats by Draft (2017 to 2037) Draft % increase 3 ft. to <4 ft. (0.91 m. to <1.22 m.) 95,330 96,070 96,650 97,050 97, % 4 ft. to <5 ft. (1.22 m. to <1.52 m.) 19,980 20,490 21,020 21,740 22, % 5 ft. to <6 ft. (1.52 m. to <1.83 m.) 2,040 2,200 2,370 2,630 2, % 6 ft. or more (1.83 m. or more) ,010 1, % Source: EXHIBIT 26 25

46 3.6.7 Length of Ohio State Boats Boats 26 feet to less than 46 feet (i.e. 8 metres to less than 14 metres) in Ohio are projected to grow at an almost uniform rate between 2017 and The projected growth in the number of recreational boats in Ohio is higher in every size category than Michigan with the exception of those boats 46 feet or more in length (i.e. 14 metres or more), 37.6 percent for Ohio compared to 39.3 for Michigan. Boats 46 feet or more length have the highest projected growth rate in Ontario, Michigan and Ohio. Table 13 Projected Growth in Ohio State Boats by Length (2017 to 2037) Length % increase 20 ft. to <26 ft. (6 m. to <8 m.) 22,510 23,570 24,430 25,110 25, % 26 ft. to <30 ft. (8 m. to <9 m.) 5,590 5,980 6,320 6,620 6, % 30 ft. to <36 ft. (9 m. to <11 m.) 8,760 9,380 9,960 10,470 10, % 36 ft. to <46 ft. (11 m. to <14 m.) 4,650 4,990 5,290 5,580 5, % 46 ft. and over (14 m. or more) 3,800 4,170 4,530 4,880 5, % Source: EXHIBIT Beam of Ohio State Boats As with Ontario and Michigan, boats in Ohio with a beam 10 feet or more (i.e. 3 metres or more) are projected to have the highest growth rates in the period between 2017 and Table 14 Projected Growth in Ohio State Boats by Beam (2017 to 2037) Beam % increase 6 ft. 6 to <10 ft. (2 m. to <3 m.) 245, , , , , % 10 ft. to <13 ft. (3 m. to <4 m.) 9,380 11,110 11,530 11,850 12, % 13 ft. and over (4 m. or more) 5,300 6,300 6,570 6,810 6, % Source: EXHIBIT Draft of Ohio State Boats Between 2017 and 2037 the number of boats by draft in Ohio is projected to grow as follows: Table 15 Projected Growth in Ohio State Boats by Draft (2017 to 2037) Draft % increase 3 ft. to <4 ft. (0.91 m. to <1.22 m.) 58,730 61,310 63,400 64,970 66, % 4 ft. to <5 ft. (1.22 m. to <1.52 m.) 11,890 12,420 13,370 13,730 14, % 5 ft. to <6 ft. (1.52 m. to <1.83 m.) 980 1,020 1,100 1,180 1, % 6 ft. or more (1.83 m. or more) % Source: EXHIBIT Implications of Growth in Ontario, Michigan and Ohio Boats for Port Elgin Harbour Marina The projections for the growth in the length, beam, and draft of recreational sail and power boats in Michigan and Ohio exhibit a generally similar pattern to that of Ontario boats, but much slower. The projected growth of boats in Michigan capable of making a cross-the-lake trip should mean that more Michigan boats will visit Port Elgin Harbour. Prior to 2017, the number of boats in the state had 26

47 been in a steady decline. Boats 26 feet or more in length (i.e. 8 metres or more) are projected to grow by 3.2 percent per annum in Ontario, 0.8 percent in Michigan, and 1.3 percent in Ohio between 2017 and As a result, by 2037 Ontario boats will generate a much larger share of the transient boats visiting Port Elgin Harbour Marina. But marinas and yacht clubs in Bruce and Grey Counties catering to transient boats from Michigan and Ohio will need to provide longer docks and wider slips as is the case in catering to transient boats from Ontario. In order to accommodate the larger boats Port Elgin Harbour Marina will need to provide more longer slips, a number of which should have 50 amp. power. Figure 11 Percentage Increase in Number of Boats in Ontario, Michigan and Ohio by Length (2017 to 2037) Percent Increase 2017 to ft. to <26 ft. (6 m. to <8 m.) 26 ft. to <30 ft. (8 m. to 9 m.) 30 ft. to <36 ft. (9 m to <11 m.) Length of Boat 36 ft. to <46 ft. (11 m. to <14 m.) 46 ft. and over (14 m. or more) Ontario Michigan Ohio 3.8 Transient Boaters Based on our work with marinas throughout Ontario we have found that an established marina offering transient slips in a good market can expect to reach high occupancy rates on holiday weekends and established special event weekends, as shown below. Monday through Friday are difficult days to attract transient boaters even with attractive discounts. Special events that draw on the history of the area are of increasing interest to transient boaters (i.e. Saugeen Metis Rendezvous, Marine Heritage Festival). Other events that have been successful in drawing transient boaters are in-water boat shows emphasizing early wooden boats, historical re-enactments portraying the municipality s early industry and its ties to the waterfront, antique/classic car shows and music festivals. Table 16 Occupancy Rates for Established Transient Marina in Good Market Area Time Period Occupancy Rate Holiday Weekends 95 to 100% or more Existing Special Event Weekends 85 to 100% or more New Special Event Weekends 65 to 85% Normal Weekends 55 to 65% Normal Weekdays 5 to 10% 27

48 According to the on-line transient boater survey and our interviews with the yacht and boating clubs on Lake Huron in Ontario and Michigan and Lake Erie in Ontario and Ohio, transient boaters are looking for the following in the order of importance expressed in Table 17 following. Table 17 Importance of Amenities and Services for Transient Boaters Facility/Service Percentage Ranking Most Important Safe (relatively sheltered) marina basin harbour 100.0% Clean and well lit washrooms 100.0% Fuel service 100.0% Staff at docks to assist in docking and providing local directions and advice 100.0% Access to provisions within walking distance 98.4% Sturdy full length finger docks 95.3% List in marina office with telephone numbers of off-site services of interest to boaters 93.8% Restaurant within walking distance 90.6% Internet/WiFi 82.8% 30 amp dockside power 82.8% Clean and well lit shower facilities 78.1% Dockside freshwater supply 76.5% Access to provisions on-site 67.2% 50 amp dockside power 64.1% Restaurant on-site 64.1% Variety of nearby attractions or events 64.1% Security gates at entrance to main docks 60.9% A place to exercise pets 51.5% Extremely Important Very Important Somewhat Important Source: EXHIBIT 36 Other amenities mentioned less frequently were a pump out service, the provision of a shuttle service to town or the availability of bicycles. Since virtually all of the services and amenities mentioned above are also important in attracting the seasonal boater market there should be no additional cost to the marina or Saugeen Shores in catering to the transient boater market. Among transient boaters those that come for special events such as festivals and regattas tend to be the highest spenders as they typically stay for more than one day. Those on their way to or from another destination tend to stay for less than half a day. Expenditures by transient boaters at grocery stores, restaurants, cafes and lounges, marine supply outlets, other retail outlets, marine repair shops and tourist attractions and events within Saugeen Shores can be substantial. The Ontario Ministry of Tourism, Recreation, and Culture, Travel Activities and Motivation Survey (TAMS), 2007 indicates an average per person transient boater expenditure of $32.80 for less than a 12 hour stay, $42.70 for less than 24 hours and not overnight, and $ for an overnight stay (average stay 3 nights). This assumes 2.1 persons per boat as per industry average. 3.9 Trends at Marinas Many marinas are now offering a new type of concierge service. Boaters call up, send an , text or otherwise communicate with the facility when they are coming to use their boat, and the marina will check out the boat to make sure it is working, batteries are charged, fuel and water tanks are full, and if desired, clean it and/or provide provisions. Some charge for all or a part of the service. The effect is to enhance the boating experience and make the boater feel special. Given the amount of time that boats increasingly sit unused, this type of service becomes that much more valuable. A large percentage of Port Elgin Harbour Marina s seasonal boaters travel a much longer distance to use their boats than is the 28

49 industry norm and typically only for the weekend. This type of service might appeal to some of the seasonal boaters and would provide an additional source of revenue for the marina. Some marinas, particularly those catering to the transient boater market are providing freshly baked muffins, juices, fresh coffees and teas, and the morning newspaper delivered to the boat at the customer s preselected or marina designated times. Some facilities charge for this service, others are including it in their transient slip charges. Other marinas are working in concert with local businesses to provide such amenities as provisioning, laundry and dry cleaning for a fee. Bicycle availability for free or as a rental, is becoming more popular with transient boaters. Many marinas are changing themselves to becoming a destination both for transients as well as locals. Festivals, cookouts and social functions are no longer the anomaly at marinas. Today s marinas are increasingly hospitality focused facilities for both boaters and non-boaters. The boating industry is to a greater degree being accessed through high-tech interface. Mobile device access is increasingly key. Apps are also increasingly important, with a growing number of marinas generating a larger portion of their customer traffic through mobile devices. Customer expectations for boating support apps and GPS-enabled route planning are also increasing. Digital connectivity will be just as important as physical connectivity for the next generation of boaters. Boaters will be looking for marinas equipped with cellular boosters, charging ports and more robust electrical systems. Website and app design will continue to grow in importance as a critical part of marina infrastructure. Most marinas have dead space, whether upland or in-water. On the docks this might be an area with very shallow water depths or an area that has limited turning space or some other restriction limiting the ability to get more traditional boats into these areas. Depending on their location and access, these areas are often ripe for on dock rental for personal watercraft such as jet skis, kayaks, canoes, either in-water or on-racks. Stand up paddle boards are the hottest trend now. Finding ways to incorporate these uses has provided marinas with an additional revenue source particularly in highly competitive market areas. In addition to facility space for customer-owned personal watercraft, many marinas are also renting out personal use nontraditional boats. In many cases, it is acting as a magnet to draw people into the marina, including especially the younger generations. There is a trend toward peaceful coexistence, if the two types of boating are properly managed. More importantly, many marinas and yacht clubs indicate these uses are a stepping stone for many to become more traditional boat owners. 29

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51 SECTION 4 MARINA OPERATION 4.1 Operation of Municipal Marinas While the vast majority of municipally owned marinas in Ontario, Michigan, and Ohio are operated by the City that owns them, there are examples of municipal marinas being leased to a private operator for a specified period of time. The Toronto Island Marina (on Centre Island in Toronto) and Bluffer s Park Marina (in Scarborough) are privately run by way of 20 year leases with the City of Toronto based on 6 percent of gross annual revenues. The operators are responsible for all operating costs, capital costs including dredging, utilities and property taxes. Bronte Outer Harbour Marina (in Oakville) is leased to a private operator under a 49 year lease, the private operator pays Halton Region 12 percent of net operating profit annually, and is required to invest a minimum of $200,000 annually or $2,000,000 during each 10 year segment of the lease in infrastructure maintenance or improvements. One of the conditions of the Bronte Outer Harbour Marina lease is that the operator is not required to provide dedicated transient slips. Port Dalhousie Pier Marina (in St. Catherines) was constructed in 1991 on lands leased to Port Dalhousie Pier Inc. from the City of St. Catharines for the purposes of constructing and operating a marina. One of the four parcels of lands and water lots leased to Port Dalhousie Pier Inc. is leased from the Federal Government and then in turn leased to the private operator. The City has a 49 year agreement with the federal government to lease the one parcel of land at an annual cost of $ plus 20% of all gross revenues accruing to the City from that parcel of land. The City of St. Catharines s lease with Port Dalhousie Pier Inc. is in its second twenty year term (i.e to 2012, 2012 to 2032). There is an option to renew the lease for a further possible twenty year term in five year periods subject to renegotiated provisions of the lease. The current lease commenced at 15% of gross receipts and calls for an increase of 1% of gross revenues every two years. Lease payments are due and payable quarterly. Likewise, the New Harrison Marina in Toledo Ohio, and the Henderson Municipal Marina in Detroit Michigan are City owned and privately operated. In the case of New Harrison Marina, the private operator gets an annual management fee that increases three percent per year, plus 13.5 percent of net operating profit. The private operator of Henderson Municipal Marina in Detroit pays a flat annual rental fee plus a percentage of various gross revenues to the City. In our discussions with these operators, it was clear that the provision of seasonal slips was the crucial element in allowing them to generate sufficient cash flow to be attractive to a private operator. None of the Ontario facilities operated under leases provide dedicated transient slips. The concern most frequently raised by the municipalities was the difficulty in having the private operator undertake infrastructure improvements in a timely manner. In one case the required infrastructure improvements were left to the last year of the lease and an attempt was made to only complete them if a lease renewal was granted. We are unaware of any municipally owned transient-only marinas that are operated privately through a long-term lease agreement. There are numerous examples where elements of municipally owned marinas are leased, these include the restaurant component, the repair component, marine services or chandlery store, and vending machine component. Direct management contracts and long-term leases are the most prominent lease arrangements for municipalities. The following is a description of each. Direct Management Contract. This is the preferred method when the municipality wants to retain ownership of the marina or when municipal, provincial or state law prevents a lease. The length of typical marina management contracts varies from three to 20 years, with 10 years the most common. Renewal is based on good revenues and performance. Generally, the municipality pays an annual management fee, which increases each year by a certain percentage, plus a percentage of revenues. In the United States, if there is any non-taxable bond money involved in the marina, IRS regulations prohibit giving a percentage of its income to a private entrepreneur. Trent Port Marina (in Quinte West) and Kincardine Marina operate through a form of direct management contract. The manager of Trent Port Marina is employed each year from April 1 st until October 31 st or such time as the marina is closed for the off 31

52 season. The marina manager is employed for an agreed upon amount each year for a term of three years, with the opportunity for renewal with an increase for a second three year term. Hiring of casual staff and their supervision is the responsibility of the marina manager, although they are paid by the City. Kincardine Marina is operated by Kincardine Yacht Club under the terms of a 10 year agreement with the municipality with the option of extending the agreement for another five year term. All rates are proposed by the yacht club and approved by the Municipality. The yacht club is required to submit a business plan and budget to the Recreational Services Committee for the Municipality s review and approval. The business plan budget must cover all items of operation, improvement and maintenance. All marina staff are employed by the yacht club. The yacht club is also solely responsible for the acquisition of goods and the choice of suppliers. Cash generated from the net marina operating profit is first used to repay any existing loan advanced from the Equipment Replacement Reserve Fund and the remainder is to be transferred to the Marina Reserve Fund. The profit sharing schedule is provided in EXHIBIT 32. Long-Term Lease. This is the preferred method when a municipal marina needs major repair and the municipality does not have the money to pay for it. The lease typically specifies the amount to be invested in capital improvements and revenue allocation. A long-term lease allows cost recovery plus profit for the private operator. Generally, long-term leases are only successful with large marina operation with a minimum of 350 to 400 seasonal slips. 4.2 Organization and Operation of Port Elgin Harbour Marina Port Elgin Harbour Marina operates from May 1 st until October 31 st annually. A Harbour Master oversees the operations under the direction of the Parks Manager who reports to the Director of Community Services. The Harbour Master is employed for approximately 30 weeks of the year beginning April 1 st. An Assistant Manager is employed for approximately 26 weeks. Depending on budget five to seven casual staff are hired annually to assist with the harbour operations and work for approximately 35 hours each week of their employment. Figure 12 shows the current staffing levels and organizational structure. Figure 12 Port Elgin Harbour Organizational Chart Director Community Services Parks Manager Assistant Harbour Master (Adult) Harbour Master (Adult) Maintenance Person (Half time) Dockhand (Student) Dockhand (Student) Dockhand (Student) Dockhand (Student) Dockhand (Student) 32

53 Ideally there should be a Harbour Master and Assistant Harbour Master both of whom are adults with some experience in operating a marina. The Harbour Master in particular should have a minimum 3 to 5 years experience. Either the Harbour Master or Assistant should be on site with a least one dockhand during all operating hours of the marina. During weekends and statutory holiday weekdays from June 1 until Labour Day at least two dockhands should be on duty during all operating hours. We understand the maintenance person works part time for the marina with the other time assigned to other duties with the municipality. This same procedure for maintenance is common with small municipally operated marinas. As with most marinas, dockhands can be students or adults with minimum boating experience although a thorough training session should be completed at the commencement of their work period for the boating season. At least one of the marina employees on duty should have training in basic first aid. Dockhands are typically responsible for assisting seasonal and transient boaters when required, operating the fuel pumps and pump out and keeping the washrooms and docks clean at all times. Ideally the washrooms should be checked and cleaned more than once per day and the main and finger docks and power pedestals swept of debris daily. Our analysis of staffing levels at the other marinas within the Bruce/Grey Area and other areas of Ontario indicates that the staffing level for casual staff proposed for 2017 is on the low side. The industry norm is approximately one casual staff for every 25 occupied slips in a marina catering to seasonal and transient boaters. Based on the 2016 occupancy rate this would equate to a need for approximately 9 casual staff. Should the marina reach full occupancy again the number of casual staff during the peak operating period from mid June to Labour Day should be increased to 11. Based on our review and analysis of marina operations throughout Ontario we believe the current system employed at Port Elgin Harbour should be continued. We also recommend that consideration be given to offering the Harbour Master a three year contract based on approximately 30 weeks per year with a small percentage increase each year in keeping with what is offered to municipal staff at the same level (i.e. 1½ to 3%). Ensuring that the Harbour Master is in place for a number of years will promote a sense of stability of operation among the boaters and should allow for a smoother transition from one year to the next with new programs and policies that are introduced. The Marina Manager at Trent Port Marina in Quinte West is employed on a seasonal basis on a three year contract. The Assistant Manager and casual staff are hired by the City each boating season. 4.3 Necessary Marina Facilities and Services The following descriptions are guidelines only. It is recognized that budgetary constraints do not allow all marinas to meet these guidelines Water Supply Water usage requirements should be estimated on the basis of 95 litres per occupied slip per day for recreational boats and 250 litres per slip per day for commercial charter/tour boat operations. These numbers represent an estimate of the peak day demands and may be seasonally adjusted for overall water supply volume demands Sanitary Facilities and Waste Water Systems Appropriate restrooms and shower facilities are a must in virtually every marina facility. A great deal of concern has been expressed about boats in marinas fouling the area waters by discharge of waste materials. One proven method to mitigate boater discharge of sanitary waste is to provide clean and accessible toilet facilities in numbers suitable for the volume of use by patrons in the marina. Sanitary facilities should be located within 150 metres of the shore end of every pier. Although marina design guidelines normally require a specified number of toilet facilities per number of boats, experience has shown that owners of power boats 11 metres (36 feet) in length and longer will rarely use the shoreside heads while owners of boats 9 metres (30 feet) in length and smaller will most often use the shoreside 33

54 heads. Sail boaters with boats 10 metres (35 feet) in length and smaller will generally use the shoreside heads while boats of any type 15 metres (50 feet) and over will rarely use the shoreside facilities. Heads and showers should never be coin operated. The resentment resulting from pay toilets is not worth the small return in revenue. In fact, the restrooms should be the best that the marina can afford and should be used as a marketing tool for prospective boaters. Sewage pumpout facilities for boats should be provided at a minimum of one pumpout per 100 recreational slips or fraction thereof. The slip count may consider only the size of boats normally fitted with sewage holding tank capability. Runabouts and day sailers not having provision for fixed sewage holding tanks need not be included in the boat count for pumpout capacity. Table 18 following presents the suggested number of sanitary facilities appropriate for various size marinas. Port Elgin Harbour exceeds the recommended standard for sanitary facilities at marinas with 251 to 300 slip in every category except pumpout stations. Table 18 Recommended Number of Sanitary Facilities for Marinas of Varying Size Number of Wet Heads (Toilets) Urinals Sinks Showers Pumpout Slips F M M F M F M Stations 0 to to to to to to Port Elgin Harbour For marinas exceeding 300 slips, increase the unit requirements by one unit per 100 additional slips Source: Marinas and Small Craft Harbors, Bruce Tobiasson and Ronald Kollmeyer, Van Nostrand Reinhold, Fire Protection Water Systems Fire protection systems are becoming commonplace in marinas. The requirements for provision of water distribution systems for fire fighting are perhaps the most varied of any utility furnished in a marina. Fire protection is most often the responsibility of the local fire department or fire marshall. There appears to be little consensus on the appropriate requirements for marinas and each fire department injects its own thinking and desires. We would recommend that the Harbour Master meet with the fire department to ensure that the marina is up to the local code requirements in case of fire, and to discuss any local concerns regarding fire rows for winter stored boats Solid Waste The proper disposal of solid waste should be encouraged by placement of trash receptacles in convenient areas in a reasonable number. Generally as a minimum, a trash receptacle should be placed at the shore end of each main dock and in any area where people tend to gather such as a ship store, haul-out facility, launch ramp, etc. Container type dumpsters should also be provided to allow for the frequent emptying of smaller trash receptacles. The marina should be posted to advise users that overboard discharge of solid waste in the marina or waterways is prohibited. Solid waste generation is estimated at 3 pounds per slip per day Waste Oil The marina should provide a suitable waste oil container for disposal of used engine oil, etc. The container should be designed to allow easy placement of the waste oil into the tank and the fill pipe 34

55 should be fitted with a tight cover. The container should have a tray or other structure to contain any overspillage resulting from the oil transfer operation. In general, a 950 to 1,050 litre waste oil tank will provide a suitable waste oil capacity for up to 150 boats Laundry Facilities Providing laundry equipment in a marina can be a money maker and a positive marketing tool for attracting transient boaters. Outright purchase of laundry equipment is often favoured over leasing. The quality of commercial laundry machines is such that down time and repair costs are minimal. The machines are generally coin operated. Although the number of laundry units may vary by type of boat mix, a rule of thumb is to provide three washers and four dryers for each 100 slips in a transient marina. Money changing machines may also be desirable to keep users from bothering the marina staff for change and also for operation beyond the hours of manning by marina staff if desired Marina Office The marina office is the heart of the marina operation. From here the marina manger must meet and greet the public, solve customer problems, provide operational guidance to marina staff and perform the administrative aspects of the marina operation. Its location should be central to the marina, since, all marina users will visit the marina office at one time or other during their stay at the marina. It should be easily accessible and well marked. Preferably the marina office, or parts of it, should have a commanding view of the entire marina facility. It should have public and private spaces. The public should be welcomed into an area that is comfortable but arranged to expedite people on their business rather than providing a hangout. To accomplish this goal, a counter or dutch door is appropriate. Both convey a brief encounter and rapid completion of business. The marina manager should have a private office to provide the proper climate for airing patron or employee grievances. The manager will also need time to complete paper work and scheduling. There is no given size that a marina office must be, nor any specific guidelines for its form, shape or extent, other than to fulfil the above mission. In or near the marina office there should be one or more pay phones for public use to prevent tying up the marina office phones. The marina office lobby is a good place for a bulletin board and message centre. Some marinas will also have a weather station readout for the area in the lobby and other weather related information available and internet access. If vending machines are desired, this may also be the most appropriate location for security reasons. The marina office should have a good array of communications equipment suitable for the marina operation. This generally includes landline telephones, marine VHF radio telephones (especially when taking reservations), and local use walkie talkie type radio units for use by the marina manager and staff. The office should also have a status board with the marina layout painted or inscribed on the board together with slip assignments and other operational information. In lieu of the traditional status board, some larger marinas have computer generated slips layout presentations, that can provide a full range of information on slips, occupancy status, utilities availability, water depth, etc. The number of slips in Port Elgin Harbour Marina does not merit a computerized system for this purpose. This aspect is especially important for transient marinas at peak use periods. Ideally the marina office space should include a mud room for marina staff to get out of the weather and to remove wet and dirty foul weather gear. 4.4 Operational Aspects No matter how well sited, designed and constructed a marina is, if it is not well operated it will not be successful. Marinas are part of the service industry and the safety and needs of marina patrons must be provided in a knowledgeable and efficient manner. Most marinas are operated by a team of individuals that must function effectively and with a plan of action. In order to manage the team effectively, a well thought out plan of action should be developed. The plan of action will contain administrative aspects, operations guidance, rules and regulations for marina customers, and protocols to handle emergency situations. 35

56 4.4.1 Service Orientation The success of the marina relies on the ability to attract and retain customers. As with most high-end recreational pursuits, many customers will not appreciate the high capital cost of constructing a marina or the cost to properly maintain the facility. It is therefore extremely important to provide quality services at a fair price and in a friendly manner. Providing competent dockhands to assist in docking and undocking is a service well appreciated by most boaters, especially new boaters who may not be experienced boat handlers. Transient boaters will generally not be familiar with the marina layout or with the effects of wind and current at the marina location. The dockhands may represent the first impression of the quality of the marina and they should act and respond to the customer s requests accordingly. The dockhands can, in addition to helping dock the vessel, provide information on registration and marina policy and direct the transient boater to other marina or area services. Just as the buzz word for real estate marketing is location, location, location; it might be said that the buzz word for a successful marina operation is service, service, service Insurance It is important to create an atmosphere that will mitigate liability and reduce insurance costs. Every marina manager and his or her staff should be on constant patrol for areas that create high insurance risks. The physical plant should be routinely scrutinized for defects. Missing handrails, tripping hazards, loose planks, exposed wiring, slippery floors, etc. should be brought to the Harbour Master and maintenance person s attention quickly and repaired immediately Security and Surveillance Providing adequate security is difficult because people legitimately using the marina often do not want to be subjected to intense security clearance to obtain access to their boat or other marina facilities. With increase in size and subsequent cost of recreational boats today security is becoming more of an issue at marinas. In the case of the Port Elgin Harbour Marina, general public access should not be allowed on the main and finger docks. The security gates on the main docks at the south end of the marina should be replicated at the north end. Security wings around the dock gate to prevent people from swinging around the gate and thereby gaining access have proven worthwhile when installed. The installation of live web cam systems at marinas is a popular trend that if done correctly provides an additional form of security and surveillance for both the marina office and the seasonal boaters. Adequate lighting should be carried out throughout the facility including washroom facilities, laundry area and all places where the boaters may have occasion to pass or use during darkness. Care must be taken however, not to create a lighting pattern that interferes with boat navigation or distracts from activities aboard the berthed boats. Low level lighting on the docks should be designed to illuminate the dock surface and immediate area for safe passage but should not be directed to the water berth or in any way blind the vision of a boat operator manoeuvring in the darkness. Low level lighting on docks is typically provided by the dock pedestals and the south docks are properly lit. The north docks will be appropriately lit when they are replaced. Parking lots and storage areas can be properly lit when new lighting system is designed Concierge Services As mentioned previously in this section a current trend in the marina industry is to enhance the number and quality of services provide to the seasonal and transient customers. The services provided are often beyond those that can be directly provided by the usual scope of the marina, and the procurement of the services may be difficult for the recent arrival unfamiliar with the local area. A fee for concierge services may or may not be levied by the provider. Arrangements are often made with the actual provider of the service to pay the concierge a commission for recommending the service. 36

57 4.4.5 Operations Manual An operations manual should be available that defines the marina s operations policy and defines actions that operations personnel are expected to execute in the day-to-day operation of the marina. All operational personnel should be required to familiarize themselves with its content and goals. A start of the season workshop is constructive, especially since many of the dockhands will be first time employees. A good operations manual will be comprehensive and tailored to the specific needs and requirements of the marina in question. Some typical operations manual categories include: Hours of operation and manning levels Personnel orientation Daily and weekly routine and work assignments Dress code and housekeeping Use and operation of marina equipment Security policy Fire prevention and control procedures Marine radio procedures Cash receipts and credit card policy Procurement of supplies and equipment Handling of outside contractors and vendors Transient vessel reservations and vessel handling Allowable work that may be performed by boat owners while at the marina Pump out facility procedures Vending machine operations Procedures for arrival of foreign vessels Liaison with Coast Guard and other enforcement agencies Procedures in case of storms Emergency procedures The Saugeen Shores Harbour Staff Manual, updated October 2017 contains an excellent description of the proper procedures for most of the categories normally included in an Operations Manual. Instructions on the procedures for handling the following categories should be included in the next update. Procurement of supplies and equipment Handling of outside contractors and vendors Allowable work that may be performed by boat owners while at the marina Procedures for arrival of foreign vessels Liaison with Coast Guard and other enforcement agencies Procedures in case of storms Maintenance Maintenance is the cornerstone of the marina s safety and long term survival. It should be a continuing process with defined areas of scrutiny and scheduled follow-up repair and monitoring. Maintenance monitoring should be a part of the daily routine, at least in so far as observations of facility components and recording deficiencies that are observed. Maintenance may be generally grouped into two categories: unscheduled and scheduled. Unscheduled maintenance is of a nature that requires immediate attention to protect life and property. Examples might include uneven or missing deck planks that might create a tripping hazard or a broken power post with exposed wire that might electrocute the unsuspecting user. Scheduled maintenance might include complete deck refastening or the installation of new mooring chains on a periodic basis. 37

58 The best way to address maintenance is to develop a maintenance plan that addresses the specific marina and its staff. The marina manager usually develops the maintenance plan with input from the marina owner and discussions with the marina staff. All items requiring scrutiny should be included. Depending on the level of sophistication desired, the plan should include time frames for inspection surveys, staffing of inspection teams, forms for reporting data, task initiation forms, and task completion forms, as well as cost itemization for maintenance costs. In order to appropriately apply the results of a good maintenance plan, it is necessary to have available funding to implement the maintenance operation. Based on our review of the financial statements for the Port Elgin Harbour Marina between 2009 and 2016, there is an annual allocation for maintenance and equipment repair although low by industry standards and a capital reserve fund which is not the case with all marinas. The industry norm following the installation of new docks is an allocation of $ per dock for maintenance and repairs increasing by 8 percent per annum in the second and subsequent years. On an on-going basis a maintenance account should be developed and updated from the conditions discovered in the maintenance surveys. Major maintenance items should be scheduled to be implemented in a time frame acceptable from the financial as well as from the need perspective. Assessing maintenance needs will allow for incremental funding creation in a reserve account and will not require major capital expenditure on short notice. Of course, major emergency items will require immediate attention, but these can be minimized by conscious applications of preventative maintenance and periodic maintenance surveys and inspections. 4.5 Operation of Port Elgin Harbour Marina The survey of boater and Saugeen Shores residents reveals that there is little need for change in the relationship between the boaters and/or the casual staff (Figure 13). In addition, more than 87 percent of the boaters approve of the current hours of operation. Approximately 10 percent of those responding to the survey would like the marina to remain open until 9:00 pm during peak summer operating hours (EXHIBIT 37). Figure 13 Contact with Marina Management and Casual Staff at Port Elgin Harbour Marina Boater's Perception of Contact with Marina Management and Casual Staff Percent Ease of contacting marina management Follow-up after contacting marina management No Need for Change Great Need for Change Ease of dealing with casual marina staff Response of casual marina staff to request Level of Need for Change Source: EXHIBIT 37, Survey of Boater and Saugeen Shores Residents, November-December based on 108 responses to question 38

59 SECTION 5 FINANCIAL REVIEW 5.1 Review of Port Elgin Harbour Marina Revenues Our review of the financial statements from 2010 to 2015 and the budget for 2016 (EXHIBIT 33) indicates that the Port Elgin Harbour Marina is a well run marina. We believe an effort should be made to increase the number of boats that are winter stored on site. Many of the marinas in the area and throughout Ontario retain a higher proportion of their seasonal boaters over the winter than Port Elgin Harbour Marina. A more secure environment for storage (i.e. fencing, web cam coverage) would help encourage more boaters to winter store their boats on-site. Revenues accruing from the sale of fuel are at the upper end of the profit margin ratio (i.e. 15 to 20%) which is good for business but should be reviewed on an annual basis to ensure that the margin is not excessive. It is recognized that the constant fluctuations in the price that the marina pays for fuel will not make this easy. Boaters also need to recognize that since the marina can only purchase a limited quantity of fuel at one time that prices are generally above street prices. An attempt should also be made to increase the space available within or in close proximity of the marina office for ship s store related products to be sold. The typical mark up on this merchandise is anywhere from 60 to 80 percent and can be an important profit centre for the marina. If space does not permit within the marina office building, consideration may be given to having a local business sell these products on the marina property for a percentage of gross or net sales. Consideration should also be given to ways in which the launch ramp can be better monitored to ensure that all users are paying for the use of the ramp. Many marinas are now offering free pump out service to their seasonal boaters. Given that Port Elgin Harbour Marina has only generated $3,500 to $5,000 annually between 2009 and 2015 for this service this would be a less than one percent loss of revenue but viewed positively by the seasonal boaters. As noted in Section 2 of this report, Port Elgin s seasonal slip fee is approximately 2 percent above the average of $64.67 for the eight marina facilities in the Bruce and Grey Counties, and Port Elgin Harbour Marina has the highest fee for an un-serviced slip at $59.80 per linear foot. Approximately 40 percent of those responding to the Boater and Saugeen Shores Resident survey perceive that the seasonal slip fees are poor or somewhat poor value (Table 19 following). In order to bring the seasonal slip fees more in line with the market area, we recommend that the fees for the slips at the south end of the harbour be raised no more than 2 percent annually until they are equal to the area average, and the fees for the north end slips be raised no more than one percent annually until they are replaced with docks of similar quality to those at the south end. An annual survey of marina fees in Bruce and Grey Counties should then be used as a guide for those at Port Elgin Harbour. Table 19 Perception of Value for Selected Port Elgin Harbour Marina Fees Poor Value Good Value Seasonal slip rental fee 13.1% 27.3% 37.4% 13.1% 9.1% Winter storage fee 11.1% 14.8% 45.7% 14.8% 13.6% Daily launch ramp fee 12.2% 8.5% 40.2% 15.9% 23.2% Seasonal launch ramp fee 9.8% 6.1% 45.1% 12.2% 26.8% Cost of fuel 18.3% 17.2% 40.9% 12.9% 10.8% Seasonal pump-out fee 14.9% 11.5% 35.6% 19.5% 18.4% Seasonal hydro fee 18.6% 14.0% 34.9% 16.3% 16.3% Source: EXHIBIT 37, Survey of Boater and Saugeen Shores Residents, November-December based on 101 responses to question 39

60 5.1.1 Potential Sources of Increased or New Revenue Among the potential sources of increased or new revenue for the marina are the following: Longer slips (i.e. 46 feet) with 50 amp power Tour boats/cruises/tall Ships this would require providing handicapped access from dock Non motorized boat rentals (canoes, kayaks, stand up paddle boards) this would likely require access to the water from the beach at the north end of the marina and a secured area to store the boats and could be carried out in partnership with a local business Bicycle rentals this could be carried out in partnership with a local business Concierge service for seasonal boaters that would involve preparing the boat in advance of the boaters arrival; this activity is becoming more popular at marinas where boaters are only using their boats for short periods of time (i.e. weekends only) and want to maximize their time using the boat Concierge service for transient boaters that could be done in partnership with local businesses who would deliver provisions, pickup and return dry cleaning, pharmacy/drug store needs, etc. Coin laundry service Vending machines Restaurant/bar/lounge when the lease is up for the current facility, the municipality should approach a number of the local restaurant owners to gauge their interest in operating a seasonal satellite operation; the facility would attract both boaters and residents Learning experiences many marinas and yacht clubs use learning experience programs to introduce young persons and those new to boating the skills necessary to handle sail and power boats, thus ensuring there is a continuous market for slips. Organizations such as Kincardine Power and Sail Squadron and BoaterSkills.ca offer on-board and classroom instruction. 5.2 Review of Port Elgin Harbour Marina Expenses The maintenance and equipment repair expense is considerably below the industry average of approximately 3.6 percent of revenues (EXHIBIT 34). Advertising is also below the industry average for marketing and promotion at municipal marinas of approximately one percent, although this may be a function of the area and less need to advertise. Providing the budget for uniforms is excellent as it is a growing trend with marinas and serves to easily identify marina staff especially for transient boaters and seasonal boaters who not familiar with the marina or who are at their slip infrequently. The inclusion of a reserve for replacement is also excellent, as it is not standard with all marinas and can lead to difficult budgeting decisions when major infrastructure needs arise. We recommend that the policy of offering an early payment discount be discontinued and that the first payment due date be moved to March 1 st and final payment April 1 st. Kincardine Marina requires final payment by March 31 st. Although the survey results indicate that a lower percentage of boaters are advocating for a change in the renewal and payment process we believe the change would be welcomed by the boaters and place it more in line with the closest competitor. Table 20 Slip Renewal and Payment Process Port Elgin Harbour Marina No Need for Change Great Need for Change Timing of slip renewal process 34.3% 12.7% 30.4% 3.9% 17.6% Payment process for slip renewals 37.3% 8.8% 29.4% 3.9% 19.6% Source: EXHIBIT 36, Survey of Boater and Saugeen Shores Residents, November-December based on 102 responses to question Although the various line items normally considered as reserve for replacement (i.e. transfer to reserve, transfer to 2017 electrical upgrades, transfer to 2018 upgrades, transfer to 2019 upgrades, and transfer to 2028 dock upgrades) were low between 2009 and 2014, in 2015 and 2016 the total for all items in 40

61 reserve for replacement was 20 and 19 percent of total revenues respectively was excellent. An amount of 15 to 18 percent per annum is considered ideal with many marinas in Ontario setting aside only 10 percent. 5.3 Comparison with Other Ontario Marinas Although we were unable to obtain financial statements from any of the marinas in Bruce and Grey Counties our review of the ratios of the major revenue and expense items generated at Port Elgin Harbour Marina with those of other marinas in Ontario (EXHIBIT 34) indicates that with the exception of the few line items mentioned above and again below, the marina is financially sound. EXHIBIT 35 provides the financial statements for Portsmouth Olympic Harbour Marina in Kingston and Lakefront Promenade Marina in Mississauga which are similar sized marinas to Port Elgin Harbour. The net income derived by Port Elgin Harbour Marina is certainly comparable when the much lower percentage of revenue set aside for reserve for replacement at the other two marinas is considered (i.e. 10% at Portsmouth Olympic Harbour Marina and 5% at Lakefront Promenade Marina). Although financially unwise, we are aware of a few marinas that do not provide for reserve for replacement. The average annual increase in salaries and wages is similar at the three marinas (i.e. 2.6%, 2.3% and 2.5% respectively). Cost of insurance at Port Elgin Harbour Marina has decreased an average of 4.5% annually while that of Portsmouth Olympic Harbour Marina and Lakefront Promenade Marina has increased 5.0% and 4.0% respectively. The average annual increase in maintenance & repairs costs at Port Elgin Harbour Marina is considerably above the other two at 27.8%, 8.0% and 10.0% respectively). This may be due to the condition of the dock system at the north end of the harbour, in which case, new docks will greatly reduce this expense item. The average annual increase in utilities is also much higher at Port Elgin Harbour Marina compared to the other two (i.e. 27.8%, 8.0% and 3.6% respectively). On the other hand Port Elgin Harbour Marina s office expenses have decreased an average of one percent each year while those of the other two have each increased 3.0 percent each year. 41

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63 SECTION 6 RECOMMENDED FACILITIES AND SERVICES AT PORT ELGIN HARBOUR MARINA 6.1 Preferred On-site Marina Amenities and Services In reviewing current and potential uses for Port Elgin Harbour Marina we also reviewed the responses received from the Survey of Boater and Saugeen Shores Residents, an online survey carried out during November and December 2016, available through the Saugeen Shores municipal website. Table 21 following, presents an indication of the residents and boaters preference for on-site services. The survey indicated that 98 percent of respondents were in favour of having the marina continue to operate in the Port Elgin Harbour, with 85.1 percent visiting the waterfront 10 or more times during the boating season (i.e. May 1 to October 30) and 38.7 percent visiting the waterfront 10 or more times during the non-boating season (i.e. November 1 to April 30). When asked about boat ownership plans over the next five years, boaters responded as follows: No change 64.0% Buy a bigger boat 30.0% Buy a smaller boat 2.0% Switch from sail to power or power to sail 1.0% Get out of boating 3.0% The trend toward purchasing a larger boat is common among boaters in Canada and the United States as was noted in Section 3 of this report. Table 21 Preference for On-site Amenities and Services for Seasonal Boaters at Port Elgin Harbour Marina Amenity/Service Percentage in Favour Some combination of seasonal and transient slips 98.5% Docks with 30 amp power and water 88.5% Internet/WiFi 84.6% Pump-out Station 82.3% Restaurant/Bar/Lounge 81.5% Fuel dock 80.8% Lookout/Observation deck (at end of south or north break wall) 73.8% Boater s store (chandlery offering products primarily of interest to boaters 73.1% Outdoor winter storage for boats 71.5% Mast Crane 70.8% Mobile Travel Lift 68.5% Docks with 50 amp power and water 65.4% Washroom, Shower and Laundry facilities 65.4% Rental bicycles 61.5% Tourist/visitor Information Kiosk 61.5% Engine repairs/tune-ups/replacements 60.0% Dock suitable for accommodating small cruise boats/tall Ships 58.5% Electronic repairs 57.7% Story-boards illustrating history of Port Elgin waterfront 56.9% Slips for Charter Fishing Operators/Tour Boat Operators 56.6% Small boat rental facility (canoes, kayaks, paddleboards) 56.2% Some combination of on-site and off-site parking 53.1% Sail/Canvas repairs/replacements 51.5% On-site parking only 51.5% Hull repairs/refinishing (steel, fiberglass, wood) 50.8% Strongly Favoured Moderately Favoured Favoured Source: EXHIBIT 37, Survey of Boater and Saugeen Shores Residents, November-December based on 130 responses to question 43

64 All of the strongly favoured amenities and services are currently available on-site in some form. There is a need however to improve the quality of WiFi service available as internet connection is now a way of life for nearly everyone. As stated previously, we believe an on-site restaurant/bar/lounge would be an attractor for seasonal and transient boaters as well as residents of Saugeen Shores and the surrounding area. It is likely however, that a restaurant would only prove financially successful if operated as a seasonal satellite operation by an established local restaurant owner. Among those amenities and services that are moderately favoured, the lookout would likely draw more people to the harbour and increase spending in the area. An on-site chandlery would increase revenue for the marina and could be operated in partnership with a local business. It would need to also draw on boaters from other areas to be successful, as the rule of thumb to generate sufficient sales to succeed is a marina with a minimum of 300 to 350 slips. A mast crane would attract more sail boats to the marina and in combination with a mobile travel lift attract additional power and sail boats for winter storage as it would permit a more efficient launch and haul out and use of storage space. Given the projected growth in longer boats we are recommending that the marina add approximately foot slips with 50 amp power, and that 50 amp power be added to some of the existing 40 foot slips. Laundry facilities do generate a small amount of additional revenue and are important in attracting transient boaters. Small boat rental facilities (i.e. canoes, kayaks, paddleboards) and bicycle rentals are becoming more of a standard feature at marinas as the small boat rentals are a means of introducing new boaters to the marina experience and both are revenue generators for the marina which can be operated in partnership with local businesses. Although engine repairs/tune-ups/replacements, electronic repairs, sail/canvas repairs/replacements, and hull repairs/refinishing (steel, fiberglass, wood) are favoured by the boaters and can create considerable revenue for the marina, our experience in speaking to boat repair services throughout the province is that it takes a large marina (i.e. 500 slips minimum) with at least 100 boats stored for the winter to be a successful operation. As a result we do not recommend that this option be considered for the marina site. We are aware of only one cruise company (i.e. Great Lakes Cruise Company) that operates cruise ships on the Great Lakes including Lake Huron. Although the two ships travel 18 times each summer between Toronto and Chicago and Chicago and Toronto they are likely too large to be accommodated in Port Elgin Harbour. Table 22 Great Lakes Cruise Company Ships Name of Ship Passengers Length Beam Draft M/V Victory ft. (87.17 m.) 50 ft. (15.24 m.) ft. (4.12 m.) Pearl Mist ft. ( m.) 56 ft. (17.07 m.) 12 ft. (3.66 m.) There are four classes of Tall Ships comprising over 300 vessels worldwide. Class A vessels are over 131 feet in length (i.e. 40 metres). Classes B, C, and D are all less than 131 feet and more than 100 are less than 90 feet (i.e. 27 metres). According to the sources we contacted it takes up to three years to make all the arrangements to be included as part of a sail past port or a host port. 6.2 Recommended Facilities and Services at Port Elgin Harbour Marina We recommend the following facilities and services be included in a 10 year capital development program. Add foot slips with 50 amp power. This should involve reducing the number of 20, 24 and 28 foot slips by approximately 23, 6, and one, respectively. Add 50 amp power to approximately one-third of the 40 foot slips. 44

65 Replace all the remaining north end slips with docks of similar quality to those in the south end of the harbour Employ a metered power system on the docks. Provide winged security gates at the entrance to each of the main docks at the north end of the harbour. Install a web cam system at strategic locations throughout the harbour that can be accessed by marina staff and seasonal boaters. Provide security fencing around the winter stored boats at the north end of the harbour. Improve the access to the Lake at the north end of harbour for use by rental or personally owned canoes, kayaks, stand up paddle boards, dry sailing. Purchase or lease a mobile travel lift. Purchase or lease a mast crane. EXHIBIT 38 provides an indication of the market appeal, pros and cons, and ability of each of the suggested and recommended facility s ability to be a revenue generator, broaden market appeal and address future market demand. 45

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67 SECTION 7 TEN YEAR CAPITAL DEVELOPMENT PLAN 7.0 Introduction The report has identified a number of areas within the marina infrastructure where improvement and/or modifications are proposed. This section of the report describes preliminary details and identifies the capital costs associated with these improvements. The following improvements are included in the 10 year capital plan: Replacement of the north docks which would incorporate the following: o foot slips with 50 amp service o 50 amp service for 50 percent of the existing 40 foot slips o Security gates for the main docks o Metered power pedestals o Access to the basin for rental canoes, kayaks and dry sailing Security measures including the following: o Web cam service on site o Improved lighting on land area o Security fencing for winter storage o Alongshore berm to shelter site from westerly winds Marina service improvements including: o Mobile travel lift o Mast Crane o Boarding docks at the launch ramp The details of these improvements are discussed in the following sub-sections. We have not developed a detailed 10 year capital plan. The analysis undertaken was not detailed enough to make specific annual recommendations. Docks replacement is considered most important and the other items can follow at a later date. 7.1 North Dock Replacement The north dock replacement is to provide the slip count noted in Table 23 following. Table 23 Replacement Slips by Size in the North Basin Length in feet Length in metres Existing Slips Proposed Slips Total Slips Source: Figure 1 2 Docking along east side of Dock I assumes average boat length of 20 feet (6.1 metres) The proposed layout to provide these slips is presented in Figure 14, following. The docks are expected to be floating docks with anchor system placed on or embedded into the basin bottom. The proposed dock modifications follow the general pattern of main docks in the existing marina with docks along the 47

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69 west breakwater and three docks extending from the north shore south towards the centre of the basin. However, there are several differences in the layout. The docks extend further south, particularly Dock H, to provide larger slips. Dock I, the most easterly dock, provides slips along the west side only. This leaves the east side for potential use by small non-motorized craft such as canoes, kayaks, and small dry sailing boats. Specialty launch docks for canoe, kayaks, and dry sailing boats could be installed along the east side of Dock I main dock to accommodate the launching. The water depth here is sufficient for such craft. The water depth at the north end of Dock I on the east side is in the order of 1.7 metres below chart datum and increases toward the south end to approximately 2 metres. This configuration provides longer slips and the additional space within the basin for maneuvering the longer boats. The access ramps to the main floating docks are proposed to be 9 metres long. This length of ramp does not provide access consistent with The Accessibility for Ontarians with Disabilities Act (AODA) during the full range of possible water levels. The municipality will need to engage in a discussion with the local community and confirm what level is acceptable. This approach has been followed on recent marina projects. The arrangement of docks along the breakwater on the west side of the basin is also modified. The existing docks are generally unstable at the outer end and connections to the breakwater are generally difficult to operate at the full range of water level fluctuations experienced on Lake Huron. The proposed layout of Dock F runs a main dock parallel to the breakwater with finger docks to be attached to the side of the main dock. This arrangement provides increased stability for the finger docks equal to the other docks within the basin. The dock system along the breakwater may require relocation in the winter due to ice formation. This can be accomplished simply by disconnecting the entire dock and moving it to the west side of Dock G. Proper fendering between the two dock systems would be required; Dock F would not need to be disassembled. Metered power pedestals could be installed. Electronic meters that collect and transmit power usage information are available and have been installed in some marinas. However, we have been advised that reselling power by metering usage is not permitted by Ontario Hydro. Therefore a metered system cost has not been included in our budget estimate. All new main docks in the north basin would be provided with security gates. 50 amp services would be provided on the 46 foot docks and 30 amp services to docks 30 feet or more. An allowance has also been included to upgrade 50 percent of the 40 foot docks in the south basin to a 50 amp service. The construction cost estimates do not include the provision of services to the shoreline. 7.2 Security Measures A security system, such as a web cam service that would allow boaters and marina management to view the docks and the boat storage areas can be installed. This would provide an increased level of security, but privacy concerns would need to be addressed. A local security company that specializes in providing such services may be the best contact for such services. Security fencing around the boat storage areas can be implemented. The options for providing the fencing are permanent fencing, temporary fencing, or a combination of the two. The construction budget provided herein is based on rental of a modular steel fence supplied and installed when the boats are retrieved and removed from the site to be launched. Prior to installing any permanent fencing we suggest that a landscape architect be consulted. A suggestion to install a berm along the west side of the parking lot to shelter the site from the on-shore winds during the winter was noted. A berm that would effectively reduce or block the westerly winds would require a substantial area for installation. By our observations, the parking lot and storage space is at a premium and installation of a berm would reduce the utility of this space. It would also potentially reduce the view of the lake and this may be detrimental to the visitors to the marina. Prior to installing any berm features we suggest that a landscape architect be consulted. No construction cost is carried for a berm within the provided estimate. 49

70 A general allowance for lighting improvements is carried within the construction budget estimate. This allowance covers increased lighting in the parking lot area only. An additional budget is carried under the replacement of the north docks for lighting on Dock I, and those sections of F and G dock with no power pedestals. 7.3 Marina Service Improvements The existing haulout slip is approximately 4 metres wide by 12 metres long and can accommodate most boats that are likely to use the marina basin. We understand that currently the slip is used for launching and retrieving boats with a standard mobile crane. The water depth in the slip is reported to be adequate. A mobile travel lift would allow for better control of boat launching and boat retrieval during the spring and fall operations and would facilitate retrieval of boats that require unscheduled repairs or maintenance during the boating season. Mobile straddle carriers, commonly referred to as travel lifts, are commonly used in larger marinas and particularly those with repair facilities. The purchase price of a travel lift has been included in the ten year development plan budget, although we note that the cost can be influenced by the CAD-USD exchange rate at the time of purchase. We have allowed for a travel lift with capacity for 35 tonnes. This is expected to sufficient for the maximum size of boat proposed for the marina. The travel lift would improve the marina s competitive position with seasonal boaters by improving the ability to launch or haul out boats upon request, especially for on-call repairs. It would also allow for a more efficient placement configuration of boats for winter storage. It is not, however, considered a high priority item. The condition of the haul out slip must be assessed in detail prior to making any purchase. Details of the structure are unknown and the travel lift would increase the loads on the structure. The ability of the structure to support these loads must be confirmed. A construction cost estimate to reconstruct the haul out slip, if necessary, has been included in the cost estimate as a provisional item. If a new or used travel lift is purchased it is highly likely that the haul out structure will need to be replaced. It may be desirable to consider the purchase of a second hand travel lift. This may be reasonable approach given that the use of the unit will be limited primarily to the launching and retrieval periods. There are many lifts available at prices substantially below the price of a new unit. Mechanical assessment of the unit by a properly qualified mechanic would need to be completed prior to the purchase of any used equipment. The existing mast crane, although functional, does not allow for easy installation of masts on larger vessels. A larger and higher mast crane is proposed at the same location. Boarding docks at the launch ramp are proposed to be replaced. The existing system provides access via a narrow boarding ramp along the side wall on the ramp to the boarding dock located further east. We understand that local boaters have become used accustomed to this system. The proposed replacement is a system that maintains the access on the side of the ramp and provides an additional ramp to the boarding docks from the marina wall adjacent to the launching ramp. The access ramps to the floating boarding docks would not provide access consistent with The Accessibility for Ontarians with Disabilities Act (AODA) during the full range of possible water levels. The same approach as described earlier for the main access docks should be followed to resolve this matter. 7.4 Construction Cost Estimates Construction cost estimates have been prepared for all components of the 10 year plan. A summary of the construction cost estimate is presented in Table 24 following. The cost of the haul out slip reconstruction is presented as a contingency item, subject to detailed review and assessment of the existing structure. The construction cost estimate is based on a casual review of existing structures, a discussion with the staff of the municipality, boaters, and a review of typical unit prices for marine works 50

71 and equipment in Southern Ontario. The estimate should be considered a Class D estimate and as such a construction contingency of 25 percent is added. We have also added an allowance of 15 percent to deal with the preliminary and detailed design and approval process. The construction cost estimate does not include taxes (HST). Table 24 Summary of Construction Cost Estimates Item Estimated Cost ($2017) Estimated Cost (including 15% design cost + 25% construction contingency) ($2017) Replacement of North Docks Supply and installation of docks $1,420,000 $1,988,000 (See EXHIBIT 39 for details) Servicing (for slips 30 feet and more) $300,000 $420, amp service for 50% of 40 foot slips in $54,000 $75,600 south basin Allowance for additional lighting on docks $30,000 $42,000 I, H and F Security Gates (north docks) $32,000 $44,800 Access to basin for small non-motorized $39,000 $54,600 Craft Security Measures Webcam service on site $5,000 $7,000 Improved lighting on land areas $240,000 $336,000 Security fencing for winter storage $17.00/metre $23.80/metre Marina Service Improvements Mobile travel lift $400,000 $560,000 Mast crane $16,000 $22,400 Boarding docks at launch ramp $49,000 $68,600 Provisional Items Replacement of haul out structure $360,000 $504,000 Source: EXHIBIT 39 Lighting layout is to be completed as part of the detailed site plan by a landscape architect. 51

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73 SECTION 8 FINANCIAL PROJECTIONS FOR PORT ELGIN HARBOUR MARINA 8.1 General Operating Assumptions Operating revenues and expenditures have been based on our review of the current marina operation and financial statements and the results achieved by other marinas of a similar size and character as that proposed in the development plan (Figure x). In preparing our estimates of revenues and disbursements for the marina we have made the following assumptions: We have projected a 1.5 percent annual inflation rate (as per the Royal Bank of Canada) where stated. Any variance in the actual inflation rate would have a direct effect on the projected operating results. Targeted and direct marketing efforts will be undertaken on an on-going basis as is currently the case. The rental rates and other sales percentages will be in keeping with a marina of this quality, yet reflect local and regional market conditions. The marina will be competently managed by a contract person based on three year potentially renewable contracts. When rates and percentages are quoted in these financial calculations they are representative of industry averages from our data base for this size and type of marina and are approximate. Amounts for depreciation and financing are excluded and the results show a net income position. 8.2 Specific Financial Assumptions for Publically Operated Marina In this section we have provided financial projections for the first ten operating years of the proposed 258 slip marina. REVENUES Seasonal Slip Rental Fees: In keeping with market area rental rates we have projected a rate of $63.46 per linear foot in Year 1 (2019), increasing by 2 percent per annum thereafter. Table 25 following provides the projected occupancy for the seasonal slips Table 25 Projected Occupancy of 243 Seasonal Slips Number Length Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 of Slips in feet Transient Slip Rental Fees: We have projected transient slip rental rates in keeping with the surrounding marinas in the market area in Year 1 (2019) of $1.93/ft. per day. Rates increase by 2 percent each year thereafter. Table 26 following provides the projected number of annual transient boater days based on a boating season of 182 days. 53

74 Table 26 Projected Transient Boater Days for 15 Slips Number Length Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 of Slips in feet ,000 Source: EXHIBIT 40 Winter Storage: Based on a more secure winter storage area with security fencing and a web cam service we have increased the projected revenue for Year 1 (2019) of $14,480 by an additional 2 percent each year thereafter and assumed an annual rate increase of 2 percent per linear foot. Hydro Fees: We have projected the fee for 30 amp power at $ in Year 1 (2019) and 50 amp power at $ in Year 1 (2019) for each of the occupied slips with power. Rates increase by 2 percent per annum thereafter. Fuel/Oil Sales: We have projected the current average per boat revenue from fuel sales to $ in Year 1 (2019). Sales per boat increase by inflation each year beyond Year 1. Total revenue reflects the increase in the number of seasonal and transient boats at the marina each year during the 10 year projection period. Boat Launch/Parking Revenue: We have projected that an average of 25 boats per day will use the launch ramp at the existing marina. As some marinas in the market area charge for parking as opposed to a launch fee we have projected revenue based on either $6.75 per launch or $1.35 per hour to park for a maximum of 5 hours. Rates increase by inflation each year beyond Year 1 (2019). It should be noted that this level of revenue projection can only be realized if fee for launching a boat is enforced. Merchandise Sales: We have projected the current average per boat revenue from the Marina Office Ships Store to $8.54 in Year 1 (2019), increasing by inflation each year thereafter. If it is possible to secure more space within the Marina Office for merchandise sales of partner with a local outlet we believe this revenue stream could be considerably higher. The sale of sweaters, other clothing and materials with the waterfront/marina emblem from a tuck shop within the marina office complex proves extremely popular with transient and seasonal boaters particularly on inclement weather days. The industry average is $10.00 per transient boat and $25.00 per seasonal boat. DISBURSEMENTS Labour Costs: We have increased the current costs for full-time labour, casual labour and Public Works labour by 3 percent each year between 2016 and Year 1 (2019). Labour costs are assumed to increase at 3 percent per annum beyond Year 1. Overtime/Shift Premiums/Standbys: In keeping with the current situation at the marina we have provided no provisions for overtime, shift premiums or standbys. The industry average is 3.5 percent of annual full and part-time labour costs. 54

75 Employee Benefits: Based on the current amount allocated for employee benefits we have assumed 16.4 percent of the total labour costs for full-time labour, casual labour and Public Works labour in each year of the ten year projection period. Utilities: We have increased current costs by 3.5 percent per annum throughout the ten year projection period, as per industry averages. Hydro (Office Building & Docks): We have increased the current expense by inflation to $23,610 in Year 1 (2019), increasing by 4.5 percent per annum each year thereafter to account for the addition of 50 amp service on one half of the 40 foot docks and all of the 46 foot docks. Office Expenses: We have increased the current expense by inflation each year throughout the ten year projection period. Small Craft Harbours Lease: We have increased the 2016 lease amount by inflation each year throughout the ten year projection period. Fuel Dock Cost of Sales: Set at 83 percent of fuel revenue as per current cost of fuel. Industry average is anywhere between 80 and 85 percent. Cost of Merchandise: Set at 60 percent of merchandise revenue as per current cost at the marina. Industry average is 65 percent of revenue. Insurance: Set at $17,370 in Year 1, based on current insurance cost, it typically covers the marina building, marina operators legal liability, commercial general liability, onshore property, floating property and docks, vessels property, and miscellaneous equipment, and increasing at 5 percent per annum thereafter as per industry average. Maintenance & Repairs: Set at $100 per slip in Year 2 and increasing at 8 percent per annum each year thereafter. A provision of $100 per slip for B and C Dock, and $50 per slip for the docks for the 176 slips new slips in the north end of the harbour has been made in Year 1 to cover any unforeseen start-up systems failures. Security Fence Rental: Based on supplier estimates, set at $9,500 per year in Year 1, for rental of the fencing and set-up and take down, increasing by inflation each year thereafter. Uniforms/Training/Memberships: We have increased the current expense by 2 percent each year throughout the ten year projection period. Advertising: We have increased the current expense by 2 percent each year throughout the ten year projection period. Given the large area from which the Port Elgin Harbour Marina draws seasonal and transient boaters the marketing budget should be allocated to marina-specific trade shows (e.g. Toronto International Boat Show, Detroit Boat Show, Mid-America Boat Show in Cleveland, etc.); publications (e.g. Lakeland Boating Ports O Call, Ports Cruising Guides, Sail Magazine, etc.); and trade associations (e.g. Boating Ontario formerly Ontario Marine Operators Association, etc.). Consideration should be given to increasing the annual advertising budget to 3 to 4 percent of revenues as per industry average. Bank Charges/Bad Debts: Set at 0.5 percent of total revenues as per industry average. Vehicle Lease: Set at current annual cost of $2,900 for each year of the ten year projection period. Vehicle Fuel: Increased by 0.5 percent above inflation for each year based on the current annual expense. Capital Reserve for Replacement: We have provided a reserve expense of 25 percent of revenues each year, which includes the current transfer to reserve, transfer to 2017 electrical upgrades, transfer to 55

76 2018 upgrades, transfer to 2019 upgrades, transfer to 2038 replacement of docks installed in 2013, and transfer to 2044 replacement of docks installed in This is sufficient to cover the replacement cost of the full 2013 and 2019 dock systems and services within their 25 year life cycle. Miscellaneous: Set at $15,000 in Year 1 to cover business licenses and permits; credit card commissions; short term lease of non capitalized equipment; etc., and increasing by inflation each year thereafter. 8.3 Financial Projections We have projected that revenues will increase from $673,050 in Year 1 to $757,520 in Year 5 (2023), to $826,830 by 2026, and reach $873,540 Year 10 (2028). Disbursements will increase from $594,830 in 2019, to $676,890 by 2023, to $740,380 by 2026, and reach $785,200 by As shown in EXHIBIT 41 this will result in a net income of $78,220 in 2019, increasing to $80,630 by 2023, to $86,450 by 2026, and reach $88,340 by

77 SECTION 9 SUMMARY OF KEY FINDINGS AND RECOMMENDATIONS 9.1 Key Findings The lack of slips longer than 40 feet is a concern given the projected growth in the number of boats of this length over the next twenty year period, as is the lack of 50 amp power at the docks which all of these boats now require. Seasonal and transient boaters at Port Elgin Harbour are better served than the other facilities in Bruce and Grey in terms of having a fuel dock, pump out service, launch ramp and on-site winter storage. At the same time, boaters at Port Elgin Harbour are less well served than those in Grey and Bruce Counties in terms of size of slips, number of serviced slips and adequate power. The rates and fees at Port Elgin Marina are in the upper to upper middle range compared to other facilities in Bruce and Grey. Comparison of Rates and Fees in Bruce and Grey Slip with Service Unserviced Slip Pump Out Daily Transient Fee Daily Launch Ramp Fee Haulout/ Launch Fee Outside Winter Storage Highest $ $91.00/ft. $59.80/ft. $20.00/tank $1.95/ft. $15.00 $13.25/ft. $52.90/ft. Lowest $ $48.19/ft. $42.50/ft. $14.70/tank $1.50/ft. $5.00 $6.67/ft. $8.64/ft Port Elgin Harbour Marina $65.91/ft. $59.80/ft. $14.70/tank $1.82/ft. $8.85 $10.00/ft. $8.72/ft. The rate increases at Port Elgin Harbour between 2013 and 2015 were above the area average while those for 2016 were in line with the area facilities. Between 2000 and 2015, the age of the average new boat buyer has increased from 45 to 53. During that same time period the percentage of new-boat buyers under 40 has shrunk by nearly one-half. It is significant that both males and females are over-represented in the age category with the highest percentage of new boat purchases (i.e. 45 to 53) in the Town of Saugeen Shores, Bruce County, Wellington County and the Regional Municipality of Waterloo, the geographic areas from which Port Elgin Harbour Marina has historically drawn more than 80 percent of its seasonal boaters. Occupation is a socio-demographic characteristic that is also a strong determinant of participation in boating. Within Saugeen Shores there are proportionally more individuals in professional/managerial/ administrative occupations (i.e. 59.2%, compared to the province s 56.9%), the occupation category with the highest participation level in boating (i.e. 28.8%). Household income is the strongest determinant for participation in boating. Median household income in Saugeen Shores is 22.7 percent higher than the province (i.e. $81,410 versus $66,358). In the counties with the highest potential for the marina to attract seasonal boaters median household income ($69,967) is 5.4 percent higher than the province. 57

78 While the projected population growth rates between 2017 and 2037 in the areas of highest potential for attracting seasonal boaters will match that of Ontario (i.e. 25% vs. 26%) those in the areas generating some potential will exceed the provincial growth rate (i.e. 30% vs. 26%) suggesting there may be increased potential to attract seasonal boaters from Grey, Perth, and Middlesex Counties. During the next twenty year period the age profile of power and sail boaters in the area with the highest potential for seasonal boaters for Port Elgin Harbour Marina will change dramatically as the number of boaters 65 and over increases from 9,320 in 2017 to 17,310 by 2037 and the number 25 to 34 increases from 16,550 in 2017 to 17,220 by 2023, then decreases to 14,920 by 2032, before increasing to 16,510 by With the increased number of older power and sail boaters it will be important for Port Elgin Harbour Marina and other marinas to provide wider and more stable finger docks. Projected Growth in Power and Sail Boaters by Age Group in Areas with Highest Potential for Port Elgin Marina Number of Power and Sail Boaters to to to to By 2037 Ontario boats will generate a much larger share of the transient boats visiting Port Elgin Harbour Marina. Among transient boaters those that come for special events such as festivals and regattas tend to be the highest spenders as they typically stay for more than one day. Those on their way to or from another destination tend to stay for less than half a day. The survey of boater and Saugeen Shores residents reveals that there is little need for change in the relationship between the boaters and/or the casual staff. In addition, more than 87 percent of the boaters approve of the current hours of operation. 58

79 Percentage Increase in Number of Boats in Ontario, Michigan and Ohio by Length (2017 to 2037) Percent Increase 2017 to ft. to <26 ft. (6 m. to <8 m.) 26 ft. to <30 ft. (8 m. to 9 m.) 30 ft. to <36 ft. (9 m to <11 m.) Length of Boat 36 ft. to <46 ft. (11 m. to <14 m.) 46 ft. and over (14 m. or more) Ontario Michigan Ohio Among the potential sources of increased or new revenue for the marina are the following: o Longer slips (i.e. 46 feet) with 50 amp power o Tour boats/cruises/tall Ships this would require providing handicapped access from dock o Non motorized boat rentals (canoes, kayaks, stand up paddle boards) this would likely require access to the water from the beach at the north end of the marina and a secured area to store the boats and could be carried out in partnership with a local business o Bicycle rentals this could be carried out in partnership with a local business o Concierge service for seasonal boaters that would involve preparing the boat in advance of the boaters arrival; this activity is becoming more popular at marinas where boaters are only using their boats for short periods of time (i.e. weekends only) and want to maximize their time using the boat o Concierge service for transient boaters that could be done in partnership with local businesses who would deliver provisions, pickup and return dry cleaning, pharmacy/drug store needs, etc. o Coin laundry service o Vending machines o Restaurant/bar/lounge when the lease is up for the current facility, the municipality should approach a number of the local restaurant owners to gauge their interest in operating a seasonal satellite operation; the facility would attract both boaters and residents o Learning experiences many marinas and yacht clubs use learning experience programs to introduce young persons and those new to boating the skills necessary to handle sail and power boats, thus ensuring there is a continuous market for slips. Organizations such as Kincardine Power and Sail Squadron and BoaterSkills.ca offer on-board and classroom instruction. 59

80 9.2 Key Recommendations Given the current and projected growth of larger boats in the seasonal and transient market place consideration should be given to reducing the number of slips under 30 feet and increasing the number 30 feet and over. Summary of Seasonal Slip Occupancy at Port Elgin Harbour Marina Dock Type Length (ft.) Service Provided B Power 32 to 40 Hydro & Water 92% 92% 92% 95% 90% 92% C Power 32 to 40 Hydro & Water 100% 100% 92% 95% 90% 95% H Sail 30 Hydro & Water 100% 100% 100% 100% 100% 100% G Mix 20 to 30 Hydro & Water partial 95% 100% 74% 84% 82% 80% F Mix 24 to 28 None 63% 77% 58% 53% 55% 52% I Mix 20 None 88% 93% 60% 68% 72% 70% Total 88% 92% 76% 79% 78% 78% By industry norms considered profitable By industry norms not considered profitable For Port Elgin Harbour Marina to continue to attract its fair share of seasonal boaters it will be necessary to increase the number of docks 36 feet to less than 46 feet and add docks that are 46 or more feet in length. When above normal increases in rates are necessary, it is good business practice to inform the long-term boaters as to the reason for this need (i.e. unusually high dredging costs, winter storm damage, major infrastructure improvements, etc.). Boaters also have to realize that operating marinas is a business and businesses at worst are expected to break-even but more realistically are expected to be revenue-positive. The staffing level for casual staff proposed for 2017 is on the low side. The industry norm is approximately one casual staff for every 25 occupied slips in a marina catering to seasonal and transient boaters. Based on the 2016 occupancy rate this would equate to a need for approximately 9 casual staff. Should the marina reach full occupancy again the number of casual staff during the peak operating period from mid June to Labour Day should be increased to 11. Consideration should be given to offering the Harbour Master a three year contract based on approximately 30 weeks per year with a small percentage increase each year in keeping with what is offered to municipal staff at the same level (i.e. 1½ to 3%). Ensuring that the Harbour Master is in place for a number of years will promote a sense of stability of operation among the boaters and should allow for a smoother transition from one year to the next with new programs and policies that are introduced. It is recommended that the Harbour Master meet with the fire department to ensure that the marina is up to the local code requirements in case of fire, and to discuss any local concerns regarding fire rows for winter stored boats. General public access should not be allowed on the main and finger docks at Port Elgin Harbour Marina. The security gates on the main docks at the south end of the marina should be replicated at the north end. Security wings around the dock gate to prevent people from swinging around the gate and thereby gaining access have proven worthwhile when installed. The Saugeen Shores Harbour Staff Manual, updated October 2017 contains an excellent description of the proper procedures for most of the categories normally included in an Operations Manual. Instructions on the procedures for handling the following categories should be included in the next update. o Procurement of supplies and equipment 60

81 o o o o o Handling of outside contractors and vendors Allowable work that may be performed by boat owners while at the marina Procedures for arrival of foreign vessels Liaison with Coast Guard and other enforcement agencies Procedures in case of storms In order to bring the seasonal slip fees more in line with the market area, it is recommended that the fees for the slips at the south end of the harbour be raised no more than 2 percent annually until they are equal to the area average, and the fees for the north end slips be raised no more than one percent annually until they are replaced with docks of similar quality to those at the south end. An annual survey of marina fees in Bruce and Grey Counties should then be used as a guide for those at Port Elgin Harbour. All of the strongly favoured amenities and services are currently available on-site in some form. There is a need however to improve the quality of WiFi service available as internet connection is now a way of life for nearly everyone. Preference for On-site Amenities and Services for Seasonal Boaters at Port Elgin Harbour Marina Amenity/Service Percentage in Favour Some combination of seasonal and transient slips 98.5% Docks with 30 amp power and water 88.5% Internet/WiFi 84.6% Pump-out Station 82.3% Restaurant/Bar/Lounge 81.5% Fuel dock 80.8% Strongly Favoured It is recommended that the following facilities and services be included in a 10 year capital development program. o Add foot slips with 50 amp power. This should involve reducing the number of 20, 24 and 28 foot slips by approximately 23, 6, and one, respectively. o Add 50 amp power to approximately one-third of the 40 foot slips. o Replace all the remaining north end slips with docks of similar quality to those in the south end of the harbour o Employ a metered power system on the docks. o Provide winged security gates at the entrance to each of the main docks at the north end of the harbour. o Install a web cam system at strategic locations throughout the harbour that can be accessed by marina staff and seasonal boaters. o Provide security fencing around the winter stored boats at the north end of the harbour. o Improve the access to the Lake at the north end of harbour for use by rental or personally owned canoes, kayaks, stand up paddle boards, dry sailing. o Purchase or lease a mobile travel lift. o Purchase or lease a mast crane. The following improvements are included in the 10 years capital plan: o Replacement of the north docks which would incorporate ft. docks with 50 amp service, 50 amp service for 40 ft. docks (50% +/-), security gates for the main docks, metered power pedestals and access to the basin for rental canoes, kayaks and dry sailing. o Security measures including web cam service on site, improved lighting on land areas, security fencing for winter storage and alongshore berm to shelter site from westerly winds. o Marina service improvements including mobile travel lift, mast crane and boarding docks at the launch ramp. 61

82 North basin docks replacement is considered most important and the other items can follow at a later date. The north dock replacement is to provide the slip count noted below. The docks are expected to be floating docks with anchor system placed on or embedded into the basin bottom. Replacement Slips by Size in the North Basin Length(ft.) Length(m) Slips The access ramps to the main floating docks are proposed to be 9 metres long. This length of ramp does not provide access consistent with The Accessibility for Ontarians with Disabilities Act (AODA) during full a range of possible water levels. The municipality will need to engage in a discussion with local community and confirm what level of access is acceptable. The same applies to access ramps to the boarding docks at the launch ramp. The arrangement of docks along the breakwater on the west side of the basin is also modified. The proposed layout of Dock H runs a main dock parallel to the breakwater with finger docks to be attached to the side of the main dock. This arrangement provides increased stability for the finger docks equal to the other docks within the basin. A security system, such as web cam service that would allow boaters to view the docks and the boat storage areas can be installed. This would provide an increased level of security, but privacy concerns would need to be addressed. Security fencing around the boat storage areas can be implemented. The options for providing the fencing are permanent fencing, temporary fencing or a combination of the two. A mobile travel lift, located at the present locations of a lift out slip, would allow for better control of boat launching and boat retrieval during the spring and fall operations and would facilitate retrieval of boats that require unscheduled repairs or maintenance during the season. The ability of the structure to support these loads must be confirmed. A construction cost estimate to reconstruct the haul out slips, if necessary, has been included in the cost estimate as a provisional item. You may also wish to consider the purchase of a second hand travel lift. This may be a reasonable approach given that the use of the unit will be limited primarily to the launching and retrieval periods. The existing mast crane, although functional, does not allow for easy installation of masts on larger vessels. A larger and higher mast crane is proposed at the same location. Boarding docks at the launch ramp are proposed to be replaced. The proposed replacement is a system that maintains the access on the side of the ramp and provides an additional ramp to the boarding docks from the marina wall adjacent to the launching ramp. Construction costs estimates have been prepared for all components of the 10 year plan. The cost of haul out slip reconstruction is presented as a contingency item, subject to detailed review and assessment of the existing structure. The estimate should be considered a Class D estimate. The construction cost estimates do not include taxes (HST). 62

83 Item Estimated Cost ($2017) Estimated Cost (including 15% design costs + 25% construction contingency) ($2017) Replacement of north docks Supply and installation of docks $1,420,000 $1,988,000 Servicing (for slips 30ft. and greater) $300,000 $420,000 50A service for some of the 40 slips (south basin) $54,000 $75,600 Allowance for additional lighting on docks $30,000 $42,000 Security Gates (north docks) $32,000 $44,800 Access to basin for small non-power craft $39,000 $54,600 Security measures Webcam service on site $5,000 $7,000 Improved lighting on land areas $240,000 $336,000 Security fencing for winter storage $17.00/m $23.80/m Marina Service Improvements Mobile travel lift $400,000 $560,000 Mast crane $16,000 $22,400 Boarding docks at launch ramp $49,000 $68,600 Provisional Items Replacement of haul-out structure $360,000 $504,000 63

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85 EXHIBITS 65