Pondering easier port terms for day-cruises

[Jason]

Broward ponders easier port terms for day-cruise ships

By Tom Stieghorst, Business Writer (Sun Sentintel)

Day cruise lines would get easier financial terms from Port Everglades under an arrangement set to go before the Broward County Commission today.

The agreement would eliminate any guaranteed revenues for the port based on the number of passengers carried.

Single-day cruises to sea or to the Bahamas have not been as popular as imagined when the agreements were signed. As a result, the lines have defaulted on their guarantees for the past few years.

But the port still wants to keep the day cruise lines as tenants because they generate revenue from berths that are too short for bigger cruise vessels. They also bring in revenue from parking fees and miscellaneous marine services.

The biggest single source of revenue from day cruise operators is the $1.59 per-passenger fee, which accounts for 60 percent of revenue. Day cruise lines would continue to collect the fee, but would not have to meet any annual minimums.

"Minimum guarantees for daily cruise ships are no longer an accurate reflection of today's local marketplace," Interim Port Director Phil Allen said.

The port has negotiated an agreement with Discovery Cruise Line that would serve as a pattern for other day cruise firms. In it, the line guarantees a certain annual payment based on the size of its vessel and a minimum number of port calls. The port said it would earn at least $2.03 million through 2012 from Discovery under the plan.

That's about one-third of what it would get under the current Discovery contract, signed in 2003.

Commissioners will also be asked to let the port collect on a $210,858 debt owed by SeaEscape Entertainment, another day cruise firm. That is the line's 2004 shortfall on its minimum. In a Dec. 7, 2004, letter to the port, SeaEscape said it didn't owe the sum due to "uncontrollable circumstances."

The letter cited the Iraq war, hurricanes, new competition from St. Tropez Casino Cruises and Seminole Hard Rock Hotel & Casino, and security measures at the port, among other causes.

Both Discovery and SeaEscape have paid shortfalls dating from 2003, but only Discovery has made up its 2004 shortfall. The port staff projects that SeaEscape will have a $400,000 shortfall for the 2005 year ending Sept. 30.

SeaEscape's minimum payment for 2005 under its contract signed in 2000 is $1,208,400. The sum is scheduled to rise to $1.52 million by 2010.