Broward County Commission Regular Meeting
Director's Name: Joseph Morris
Department: Port Everglades Division: Business Development
Information
Requested Action
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MOTION TO APPROVE First Amendment to the Passenger Cruise Terminal and Berth User Agreement Between Broward County and Baleària Caribbean Ltd., Corp. to extend the term for one year through November 30, 2025, and update the rates; and authorize the Mayor and Clerk to execute same.
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Why Action is Necessary
Broward County Board of County Commissioners’ approval is required to amend the Passenger Cruise Terminal and Berth User Agreement with Baleària Caribbean Ltd., Corp.
What Action Accomplishes
Amends the Passenger Cruise Terminal and Berth User Agreement with Baleària Caribbean Ltd., Corp. to, among other things, extend the term for one year through November 30, 2025, and update the rates.
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Previous Action Taken
None
Summary Explanation/Background
THE PORT EVERGLADES DEPARTMENT RECOMMENDS APPROVAL.
This action supports the Broward County Board of County Commissioners’ (“Board”) Value of “Building partnerships and working collaboratively with others to meet shared objectives,” and the Goal of “Ensuring economic opportunities and a sustainable economy, with an emphasis on Broward’s lower and middle class.”
Baleària Caribbean Ltd., Corp. (“Baleària”), has operated a fast ferry for passengers and cargo services from Port Everglades to the Bahamas since 2011. On November 14, 2023 (Item No. 19), after waiving the competitive selection requirements set forth in Section 32.4(h) of the Broward County Administrative Code in accordance with Section 32.10 of the Broward County Administrative Code, finding that there was good cause for such waiver, the Board approved the Port Everglades Passenger Cruise Terminal and Berth User Agreement between Broward County and Baleària to conduct and operate cruise/ferry passenger services at Port Everglades for a one-year term commencing on December 1, 2023, and expiring on November 30, 2024 (“Current Agreement”).
On March 21, 2024 (Item No. 14), the Board authorized negotiations for a long-term land lease and development agreement with Baleària to design, build, finance, operate, and maintain a new exclusive ferry terminal on County-owned land adjacent to Berth 28A at Port Everglades.
Baleària and Port Everglades conducted sunshined negotiations on October 2, 2024, to discuss amending the existing Passenger Cruise Terminal Berth User Agreement and a potential ground lease for the development of a new exclusive ferry terminal. Given that negotiations on the ground lease will not be finalized before the Current Agreement's expiration, the parties have mutually agreed to amend the Current Agreement to extend the term by one year, through November 30, 2025, and adjust the economic terms, consistent with the annual escalations outlined in the Port’s other cruise line berth agreements. The primary business terms of the amendment are as follows:
• Commencing on December 1, 2024, the Port User Fee for the Designated Vessel will be $46,350 per month (“Port User Fee”), an increase of 3% from the Current Agreement.
• Commencing on December 1, 2024, for each month or portion thereof that a Non-Designated Vessel is berthed at Port Everglades for lay-in purposes only, the Port User Fee for that month will increase by $7,725, an increase of 3% from the Current Agreement.
• The monthly Port User Fee includes six operating hours of Port Terminal use per day. Commencing on December 1, 2024, any use of a Terminal for more than six operating hours from first use on any given day will be billed to Baleària at the rate of $309 per hour, an increase of 3% from the Current Agreement.
• Commencing on December 1, 2024, the passenger wharfage charges (per passenger move, i.e., embark, debark, in-transit) are as follows:
o For the first 75,000 passengers: $1.55 per passenger move
o 75,001 to 150,000 passengers: $2.29 per passenger move
o 150,001 to 225,000 passengers: $3.01 per passenger move
o 225,001 passengers or greater: $3.75 per passenger move
This is an increase of 3.5% per passenger move from the Current Agreement.
• All such fees are in lieu of published rates in Port Everglades Tariff No. 12 (“Tariff”) for the Designated Vessel and Non-Designated Vessel for dockage, harbormaster fees, linehandler fees, terminal overtime, terminal electric, wharfage rates for cruise passengers, security fees, and sworn law enforcement.
• Baleària will pay all wharfage charges for cargo, if any, according to the Tariff.
• The amendment provides that Baleària shall be given preference for berth assignments over a berth application submitted by other vessels pursuant to the Tariff.
• It has become customary for Baleària to request space at the Greater Fort Lauderdale/Broward County Convention Center (“Convention Center”) to process passengers prior to embarkation when a Passenger Cruise Terminal is not available. The amendment adds language stating that Baleària shall reimburse the County for all expenses the County incurs, if any, for providing such space to Baleària if such space is requested by Baleària and states that Baleària is not guaranteed any access to the Convention Center as each request is reviewed on a case-by-case basis based on availability and approval by the Convention Center.
Baleària operates sailings to Freeport and Bimini up to six days per week. In Fiscal Year 2023, Baleària’s throughput was 114,825 passengers, generating $702,314 in revenue for the Port. Throughput for the current Fiscal Year (through August 2024) was 109,683 passengers, generating $789,221 in revenue for the Port.
Balearia’s activities in South Florida support an estimated 127 direct jobs, 73 induced jobs, and 72 indirect jobs in local industries. The direct job holders earned $4.3 million, while an additional $9.2 million was generated in local income and consumption, with indirect workers earning $2.4 million. Local businesses earned $21.4 million in sales, and the total annual tax revenue generated was approximately $1.6 million.
The First Amendment to the Agreement has been reviewed and approved as to form by the Office of the County Attorney.
Source of Additional Information
Jorge A. Hernández, Director, Business Development Division, Port Everglades Department, (954) 468-3501
Stacie Warren, Assistant Property Manager, Business Development Division, Port Everglades Department, (954) 468-3706
Fiscal Impact
Fiscal Impact/Cost Summary
The County will receive guaranteed revenue of $540,000 during the one-year extension period. The County will also receive additional revenue based on Baleària's actual passenger and cargo throughput.