Developer: Deadline near for 2nd St. marina deal

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OCEAN CITY – “If this doesn’t happen Thursday night, it’s not going to happen,” Sean Scarborough said Monday, June 25 after almost everyone had left an informational meeting on the developer’s proposed upgrades to the Second Street marina.

Asked if he meant “not going to happen” now or ever, Scarborough clarified, “For season 2013.”

Scarborough’s $1.5 million proposal received approval from the Ocean City Planning Board on June 6. He presented his plans to City Council on June 14. On Monday evening, he spent two hours answering questions from approximately 30 people at the Bayside Center, all of whom had different concerns. The 103-by-280-foot parcel of land, owned by Scarborough for three years and sold by him to the city in June 2009 for $3 million, in part with $738,000 in Green Acres funding, was subsequently purchased for $2.26 million by Cape May County.

The plot is currently being leased to the city for $1 a year. Scarborough has proposed sub-leasing the marina from the city for 25 years in exchange for improving the infrastructure immediately and realizing a profit eventually. His plan calls for Coastal Area Facilities Review Act (CAFRA) and Army Corps of Engineers permits being obtained over the winter, and for construction to be completed by Memorial Day 2013. Scarborough would operate the marina; the city would maintain and operate the upland portion of the parcel.

City Council, which was represented at the meeting by outgoing 4th Ward Councilman Roy Wagner, 4th Ward Councilman-elect Pete Guinosso, at-large Councilman Keith Hartzell, 3rd Ward Councilman Tony Wilson and 1st Ward Councilman-elect Mike DeVlieger, will vote on the plan at its Thursday, June 28 meeting as part of the consent agenda.

In response to a question as to the specifics of the lease agreement, Hartzell said council members had received packets, but he had not read his yet. The terms of the agreement between Scarborough and the city have not been publicly disclosed, although Scarborough outlined the deal as follows:

Operating as Ocean City Marina, LLC, he would provide equipment on property provided to him by the city. He would develop the property, which would include a building to house restrooms, docks and boat lifts. As the “master tenant” on the property, the city would pay Ocean City Marina, LLC, of which Scarborough is the registered agent, $135,000 annually, and the city would receive whatever revenue the marina generated up to $135,000.

This arrangement would continue until the city breaks even, which, Scarborough said, meant, “We’re incentivized to get the city to break even.” Additionally, he said, his company would pay the city a $102,000 subsidy upfront.

At least one person at the meeting took issue with Scarborough’s proposal. Eric Sauder, a regular attendee at city government meetings, said he was concerned with the alacrity with which the plan was moving, and at the lack of public information being provided. To him, he said, the situation appears to be one where the city is making a sweetheart deal with someone who stands to profit from the free use of taxpayer-owned land, a scenario he said reminded him of the city’s springtime plan to build a new city annex for the Chamber of Commerce’s use.

“Why is public property being privatized for private gain?” Sauder asked. “What’s the county’s role in this? Why are they moving ahead like they can do this? This is public land. This is a public marina. Now people are going to be renting from Scarborough. What’s the city’s association with Scarborough? He’s the only one who’s going to make money from it.”

Scarborough said he does not foresee a “gainful return for five years.”

Initially, 30 slips would be developed, he said, with 27 of them outfitted with lifts capable of each hefting a 14,000-pound, 40-foot-long boat. The lifts, Scarborough said, are necessary in order to ensure safety.

“This is such a violent portion, open to the open bay,” Scarborough said of the waterfront section of the 200 block of Bay Avenue. “The wind and the wave conditions are such that you cannot safely board a boat without a lift.”

But safety was not what the homeowners who attended the meeting wanted to discuss. One resident of the block was primarily concerned with the height of the proposed bathrooms, fearing an obstruction of her view, and with the negligent behavior of pet owners who allow their animals to urinate and defecate on city property.

James Mallon, director of community services for the city, said area residents had expressed to him concerns that public access be maintained and that those who currently rented boat slips at the marina be given a chance to rent again next year.

Chuck Betson, who lives across Bay Avenue from the marina and has rented a boat slip there for $1,400 a year for the last three years, worried that Scarborough’s improvements would cost him significantly more money than he was paying the city for his spot. Scarborough, who estimated slips would rent for $4,200 to $6,400, three to almost five times as much as boat owners currently pay the city, said he based his estimate on rents being charged at Harbour Cove in Somers Point, a marina that he admitted is not similar to the Second Street marina.

Barbara Betson, Chuck’s wife, saw little but positive to the proposed development. “You’re going to operate the water side, and the city is going to keep the green side, and this is going to save the city millions in improvements,” she said to Scarborough. “As a taxpayer, I think this might be a win-win situation.”

The marina would operate from April to Sept. 30, Scarborough said, and boat owners would have the option to keep their boats on site for the winter for an additional $900. The cost to shrink-wrap the vessels for wintertime storage would be borne by the boat owners.

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