BLUE VALUE

A proposed study to find out how much Newport Beach’s harbor resources are worth will help city officials determine if people who work and play there are contributing their fair share to its upkeep. Like one of those credit card commercials that pronounces some things “priceless,” it may be impossible to quantify the value of Newport Beach’s harbor.

That won’t stop city officials from trying.

In February, the City Council will consider commissioning a first-of-its-kind study to find out whether boaters, harbor businesses and residents who live along the coast are paying enough for the benefits they get from the water.

The proposed study is one tangible sign of a wave of changes swelling toward Newport’s coastline. For example, the city is in the midst of realigning its boat moorings for the first time since 1936. The council will likely decide within months how to use Marinapark, the only piece of city-owned waterfront land that’s available for major redevelopment.

And what could be the biggest change of all, officials are hammering out how the harbor will be addressed in the city’s general plan, which will guide land and water uses for the next 20 years.

The expected outcome of the proposed harbor study is that fees for harbor users will go up, possibly as soon as July, but the increase likely won’t be dramatic.

City officials, on the other hand, are facing a sudden spike in the cost of managing the harbor, and that’s one reason to find out what the harbor is worth.

“We have some significant harbor expenses coming down the road,” Assistant City Manager Dave Kiff said. “One of them might be Lower Newport Bay dredging, which we have never had to pay for before.”

That’s about a $6-million proposition. The lower bay needs to be dredged every 10 years or so.

In the past, it’s been paid for by federal money. But under the Bush administration, work in the lower bay has consistently gotten no funding in the federal budget, Kiff said.

Since the lower bay largely serves recreational boaters, perhaps the cost should be passed on to them through fees, Kiff said. The alternative is to take the money from the city’s general fund, he said, but “that means all 80,000 Newport Beach taxpayers are in effect paying for that.”

The city also will have to cover the bulk of cleaning up the Rhine Channel, considered one of the county’s “toxic hot spots” because of pollution lingering from when the area was a hub of ship-building and fish-canning operations. Cleaning up the channel could cost between $8 million and $18 million.

“Arguably the people who should be paying for that are the polluters, but most of them were around in the [1940s] and ‘50s and are long gone,” Kiff said.

To see how those upcoming costs match up with what the city makes on the harbor, the study will take a three-pronged approach to harbor revenues. Costs to administer the harbor -- meeting environmental standards and dredging, for example -- will be compiled. A fair market appraisal of the harbor will be performed. Finally, an economist will consider all factors and come up with a bottom-line figure, similar to a 1990 study that found that the city earns about $13 per visitor per day from its beaches.

In conjunction with the study, the council also will consider shifting harbor businesses from a system of annual permits to long-term leases. That also would mean more income for the city, which can charge for the privilege of using tidelands -- waterfront property that’s owned by the state.

Councilman Tod Ridgeway gave the example of Lido Marina Village. Its annual permit to use the water nets the city about $30,000 a year, while the docks there earn the owner about $1.2 million.

Many coastal cities, however, offer tidelands leases that charge between 25% and 35% of the revenues earned on the property. For Lido Marina Village, that would mean about $300,000.

“You can see how we’re cheating ourselves,” Ridgeway said.

In his opinion, the city’s management of the harbor for years was based more on personal relationships than businesslike policies, and he’s looking forward to the study as the impetus to change that.

“It’s the heart and soul of our city -- that is, the harbor,” Ridgeway told colleagues at a council study session earlier this month. “But we need to perhaps run it more like a business.... It just has not been tended to in a long time.”

People tend to complain whenever their fees go up for any reason, but many will probably welcome the study, said Mark Silvey, chairman of the Newport Beach Chamber of Commerce’s marine committee. Silvey also runs a business maintaining yachts for their owners, and he buys and sells yachts.

Some of the people who work and play in the harbor believe council members have ignored it because they don’t know much about the harbor and they don’t realize its importance to the city, Silvey said. He thinks the study could help.

“I think that’s due and it’s probably a good thing in general because it’ll help the City Council to focus on the fact that if there wasn’t a harbor, there wouldn’t be a Newport Beach as it is,” Silvey said. “They wouldn’t have the tourists that they have.”

The harbor study will be just one of a number of potential changes that could shape the future of Newport’s waterfront, but Kiff doesn’t expect a sudden, dramatic makeover of what he refers to as the “wild west.”

“It’s not easy to do anything sudden in the harbor,” he said.20060122itgy1hncMARK DUSTIN / DAILY PILOT(LA)A Duffy passenger vessel cruises by a row of boats mooring soundly in their slips at the Balboa Yacht Basin Marina Friday afternoon. 20060122itgy1wncMARK DUSTIN / DAILY PILOT(LA)Boats attached to their anchored buoys dot the harbor waters.