Berth Rates Explained
By Paul Kamen, April 4 2001
For distribution to Waterfront Commission
This proposal retains the same berth rate structure now in
place, with a few changes aimed at simplifying
administration of the Marina and facilitating future
adjustments to the various parameters that determine the berth
The overal size of the increase is driven by the need to
balance the Marina Fund budget. Several other plans to
increase revenue have been proposed, but the most promising
strategies, which involve increasing commercial activity in the
Marina, have been rejected by the City Council.
It should be noted that even after these increases, revenue
from berthing alone will be insufficient to cover marina operation
and maintenance. Although a significant part of the Marina budget
is used for expenses not directly related to boat
berthing, revenue from hotel and restaurant activity coming into the
Marina Fund is considerably greater than these non-berthing related costs.
So in terms of the boat berthing functions alone, the berthers are still
not quite paying their way under this plan.
The proposed revenue increase is distributed among various sizes
and types of berths with close attention to current market
characterstics and the practices of nearby marinas, and to the goal of
maintaining a diverse community of berthers.
Upwind/downwind berth: In an upwind berth, a boat enters by
turning into the prevailing wind, bow to the west. In a
downwind berth, a boat enters by turning downwind, to the
east. Upwind berths are more desirable than downwind berths.
End ties are considered upwind berths, crosswind berths are
considered downwind berths.
Single/double finger berth: A single-finger berth has a float
on only one side, a double-finger berth has floats on both
sides. Double-finger berths are more desirable than single-
Berth size: this is the nominal length of the berth, or the
"extreme length" as defined in the Marina Ordinance, whichever
Size category: In order to more closely match berth rates to
both the market demand and to the real cost of providing
berthing, the berth rate is variable for berths of different
sizes. Berth lengths are divided into categories are as
40-49 and at ten ft intervals thereafter.
Initial base rate: This is the rate per foot per month charged
for the smallest size category (20-21 ft), downwind single
finger (smallest size, least desirable).
Base rate: The base rate for a specific berth size category,
Progressive rate increment: The amount that the base rate
increases for each upward increment in size category. For example, if the
progressive rate increment is 5%, then the base rate for 22-24
ft berths is the starting base rate times 1.05, and is
multiplied by an additional 1.05 for each subsequent increase in
Progressive rate increment for unmetered power: This is the
percentage of base rate charged for unmetered power for the
22-24 ft size category, and the amount by which the rate
increses for each upward increment in size category.
(There is no unmetered power charge for the 20-21 ft size category.)
For example, if the progressive rate increment for unmetered power
is 5%, then the unmetered power charge is the base rate for 22-24 ft
berths times 0.05. For each subsequent increase in size category,
the unmetered power charge is determined by multipying the base rate
for that size by 0.05 one additional time. So for a 45 ft berth,
the unmetered power charge is the base rate for the 40-49 ft size
category times 0.05 times four.
Adjustment for double finger: This is a percentage of the base
rate. For example, if the adjustment for double-finger is 5%,
then the rate is adjusted upward by 5% of the base rate for
Adjustment for upwind berth: This is a percentage of the base
rate. For example, if the adjustment for an upwind berth is
5%, then the rate is adjusted upward by 5% of the base rate
for that size.
Credit for no dock box: A flat reduction in monthly fee for
berths that are not supplied with a dock box. If the dock box
credit is $5.00, these accounts are credited $5 every month.
Adjustment for extra-wide: A percentage adjustment over base
rate for end tie berths if the berth is used by a boat that's
too wide for a regular berth.
Progressive Rate Structure: This berth structure may seem
complicated, but it's the simplest way to match prices to
market forces. The mathematical complexity is all "under the
hood" and neither the berther nor Marina Staff needs to deal
with anything more complicated than a simple table of rates
for each size and type of berth.
Note that the cost of a boat varies by approximately size to
the fourth power. For a small boat, annual berth fees might be
as much as half the market value of the boat. For a large
boat, they are typically only a few percent. And for the
largest boats that can berth in Berkeley, the berth fees are
insignificant compared to other operational considerations.
Berths take up area inside the marina, not length. Smaller
berths can be built closer together and allow more linear feet
to be constructed in the same limited space. On this basis,
berth fees should more closely follow the square of berth
size, rather than per linear foot.
Finally, the need for major dredging projects is driven by the
requirements of the largest boats in the marina.
There is more than ample justification for a steeply
progressive rate structure. The surrounding market conditions
- i.e., rates at other nearby marinas - is the only factor
that keeps the recommended progressive rate from being
There are several organizations operating in the Marina that
should and do receive support from the City, either in the
form of below-market leases and berth fees or as direct
subsidies. Private boat owners are generally not considered to
be among this group, and there is no justification to charge
significantly below-market rates at the expense of other City
services and deserving non-profits. However, economic
diversity is considered a valuable goal for the community of
Marina berthers, and this is accomplished by retaining a
reasonable number of smaller berths in the marina design. With
vessel cost so strongly dependent on size, accessibility by
non-wealthy boat-owners is assured by continuing to provide
ample berthing in the smallest size categories.
Fee Differentials: After a year of experience with
differential fees for upwind/downwind and single-
finger/double-finger, it appears that the price differences
should be considerably larger than they are now set. That is,
berthers still prefer upwind double-finger berths, despite the
high fees. This new proposal increases them slightly, but
larger differentials may be appropriate in the future. The
proposed fee structure allows easy adjustment of this
The Dock Box Fee: This has been extremely unpopular
among the berthers, and is seen as a kind of "nickel-and dime"
approach to revenue generation, along with being an unnecessary billing
complication. Since all berths will have dock boxes after the
anticipated rebuilds are complete, there is no reason to
retain this complexity. Structuring the dock box fee as a
credit for no box rather than a fee for having a box (as is
currently the case) will allow this complication to disappear
when the dock rebuilds are complete.
Unmetered Power: The marina currently spends about
$80,000/year on power to the unmetered docks. Slightly less
than that is recovered in unmetered power charges. The City
now participates in a group contract through ABAG at a very
favorable rate. Although there's a lot of uncertainty here,
it's reasonable to assume that the cost of supplying power to
the docks will double at the end of the calendar year
when this contract runs out.
The mathematical form of the unmetered power charge is relatively
complicated, but it results in the correct exponential form that
best matches consumption patterns. The complexity is handled instantly
by a spreadsheet, and there's no need for either staff or berthers to
deal with anything but the results of this formula as applicable to
their berth size.
Large boats have at times cost the Marina almost as much in
electricity as they pay in berth fees. Therefore a steeply
progressive charge for unmetered power is justified. The long-
term solution will be to install meters on all docks and only
charge for power actually used, but meanwhile the Marina is
not in a position to absorb a large loss in order to continue
providing free electricity
Several strategies present themselves for dealing with
berthers who are unhappy with sharply rising unmetered power
charges. For example, they can be offered to switch to a berth
on a metered dock. It might also be possible for some boats to
go "off the grid," if it can be verified that they never plug
into the marina power outlets.
Results of the Changes: The changes proposed here result in a
net annual increase of just over $100,000 in revenue. This
assumes 90% occupancy and an additional $80,000 cost for
The last column of the spreadsheet shows the percentage
increase for various size categories, depending on amenities.
Note that the high percentages are driven mostly by the sharp
increase in the unmetered electricity charge applied to the
large berths. For the majority of Marina berthers, the
increase will be well under ten percent.
Option B: the Low Impact Alternative:
This alternative plan uses exactly the same rate structure
for the berting fee, but uses a much lower rate for unmetered
electricty so that there is essentially no change in this
component of the fee. This option results in about $60,000/year
revenue increase at 90% occupancy, assuming electicity costs are
A reasonable strategy might be to reserve implementation of
the electricity charge until the City begins to pay a higher rate
(probably in January 2002) and introduce the new rates for
unmetered power at that time.
Option C is similar, except that it involves a slightly higher
berth rate, so that the annual revenue increase is approximately
$100,000 as requested by the Waterfront Commission.