Baseline: Approximate berth revenue as of April 2004

Uniform across-the-board 12% increase.

9% across-the-board increase plus a steepening of the progressive rate increment from 5% to 6% per size category.

8% across-the-board increase plus a steepening of the progressive rate increment from 5% to 6% per size category, and changing the increase for premium berth features (upwind, double finger) from 6% to 7%.

7.5% across-the-board increase plus a steepening of the progressive rate increment from 5% to 6% per size category, and changing the increase for premium berth features (upwind, double finger) from 6% to 8%.

The last version has several advantages. Base rate only goes up by 7.5%, yet increased revenue is slightly higher due to the cummulative effect of the progressive rate increment and the additional charges for premium berth features.

Market experience suggests that premium berth features are currently undervalued. Increasing these charges to supply a larger portion of the needed revenue gives berthers more flexibility; those who feel they are unduly burdened by the increases will usually have the option of moving to downwind single-finger berths to avoid these increases.

This structure also has a political advantage, because it minimizes the rate increases for the floating homes, all of which are in crosswind single-finger berths that do not incur any premium berth charges.


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