Astoria will lease the eastern portion of the 17th Street Dock to American Cruise Lines, a partnership that will outsource scheduling and improvements to the private company.
The City Council on Monday night approved of staff negotiating a lease after an impromptu live negotiation with the company and its competitor, American Queen Steamboat Co.
American Cruise Lines represents about two-thirds of the river cruise boats docking behind the Columbia River Maritime Museum. The city and American Cruise Lines had negotiated a lease the would allow the company priority docking rights, while making reasonable accommodations and setting rates for competitors.
The agreement would bring the city $80,000 a year for the first three years. Afterward, the city would receive $80,000 a year plus $400 for each vessel docking beyond 110 a year, each figure adjusted annually by 2% or the last year’s consumer price index. The figures were based on the city’s average business at the dock over the past four years. The city would have to pay back American Cruise Lines for any repairs made, but the company would cover the cost of any improvements.
The lease came before the City Council for a vote in September. But American Queen’s attorney, Eric Denley, learned about the deal the same day and called foul, arguing it would essentially create a monopoly for American Cruise Lines.
American Queen came with its own deal Monday, but city councilors leaned toward American Cruise Lines’ proposal. Ares Michaelides, president of American Queen, attended the meeting Monday and said the company would be open to a lease with American Cruise Lines that protects his company’s access to the dock.
The City Council and companies engaged in a back-and-forth negotiation before tentatively reaching a deal that would provide American Cruise Lines the lease, albeit with increased competitive protections.
American Cruise Lines agreed to schedule ships two years out, give the city a part in setting fair dockage rates, ensure ships don’t park at the dock more than 24 hours at a time and eventually expand the 17th Street Dock to accommodate two vessels at a time.
American Cruise Lines also agreed to decrease the term of the lease from 41 to 26 years, eliminating a 15-year renewal option. The lease will likely be adopted by the City Council on Oct. 21.
Jeff Harrington, the city’s public works director, has argued the company can better-maintain the ailing mooring dolphins next to the dock than the cash-strapped city. He estimated fixing all seven would cost between $500,000 and $600,000, money the city cannot afford while trying to pay down more than $1 million in debt for the reconstruction of the dock.
City Councilor Roger Rocka took issue with the lease not requiring the company to make any improvements or expansions to the dock. But the city is already unlikely to make any improvements, Harrington said.
Charles Robertson, vice president of American Cruise Lines, said the company planned to make improvements to the dock but didn’t want to lay them out until it has a lease. The company plans to eventually have five cruise ships on the Columbia, he said.
“The existing facility is fine for now,” he said. “Our goal would be to be able to bring in two ships at a time.”