PAPER C

Committee: AUDIT AND PERFORMANCE COMMITTEE

Date: 14 NOVEMBER 2006

Title: HARBOURS MANAGED BY THE ISLE OF WIGHT COUNCIL

REPORT OF CABINET MEMBER FOR ENVIRONMENT, PLANNING AND TRANSPORT

SUMMARY

This report provides further information on the harbours owned and managed by the Isle of Wight Council at Newport, Ventnor and Ryde, together with additional details on expenditure and income.

ACTION REQUIRED

None.

CONFIDENTIAL ITEMS

None.

BACKGROUND – NEWPORT HARBOUR

1.0 Newport Harbour extends along the River Medina from the Folly at Whippingham to Newport Quay, a distance of nearly 3 miles. The income generated is derived from 3 main sources, Newport moorings, Folly moorings, and adjacent property rental.

1.1 Income at the Folly is collected by Folly Reach Harbour Management who act agents for the Council. They also collect income for Cowes Harbour Commission and Whitbread who also own holdings at Folly Reach. The income is collected throughout the year from the visitor pontoons. Folly Reach Harbour Management also undertake an important safety role as they are on site 52 weeks a year.

1.2 The Newport Harbour Master lets summer moorings at the Folly. The demand is currently greater than the number of available moorings. It would be profitable to place additional moorings but the intertidal area is a Special Protection Area (SPA) and the installation of further moorings would not be permitted for environmental reasons.

1.3 Folly income is £66k, whilst expenditure is circa £18k, giving a surplus of around £48k which offsets a significant part of the deficit for Newport Harbour which arises from historical non-controllable expenditure (principally BVACOP and capital charges).

1.4 Income at Newport Harbour is generated by visitors using the pontoons, permanent berth holders and winter dry berth storage. Visitor numbers hover around 2,000 per annum, but vandalism and trouble with boat security threaten to reduce this figure. The use of Newport Harbour as a bus park on Tuesdays severely restricts the extent to which winter dry berth storage is possible. A further £5,000 per annum could be generated if the full extent of boat storage was achieved.

1.5 Newport Harbour is a tidal port, and thus dries out over the low tide. Retaining water within the harbour over low tide is considered a potentially significant boost to the regeneration and redevelopment of the harbour. The obstacles to such a development are large, but the benefits are potentially huge too. Not only would the number of berths increase and thereby increase income, the value of adjacent land, much of it under Council control, would also increase. The requirement for necessary studies before such a proposal could be realised are currently being assessed, but such a scheme has the potential to transform Newport Harbour.

1.6 Newport Harbour also derives income from the rental of adjacent property. Since the mid 1990’s there has been a move away from commercial shipping activities towards leisure. The commercial income has reduced as various buildings were put into alternative use or demolished. Examples include Jubilee Stores, the Classic Boat Museum and the site now occupied by the Whitbread hotel and pub. The commercial importation of sand and gravel has ceased in recent years and this has reduced the harbour dues collected on landing cargo. Whilst this transformation is particularly welcome these changes, which have resulted in a significant reduction in income, have not been reflected in the Harbours budget.

BACKGROUND - VENTNOR HAVEN

2.0 Ventnor Haven was built at a cost of just over £2m, using funding from a variety of sources. The Single Regeneration Budget provided the largest contribution of approximately £1.25m, with substantial contributions coming from the Isle of Wight Council (£650,000), and Defra coast protection grant aid (£265,000).

2.1 The haven fulfils a number of objectives including the removal of commercial fishing boats landing on Ventnor beach, a fair-weather haven for small yachts and pleasure craft, a walkway seaward of the Esplanade as a form of replacement for the former Ventnor Pier, a destination for visiting craft sailing along the south coast and coast protection for the Victorian seawall.

2.2 The haven has provided a significant impetus for the regeneration of Ventnor seafront, the Eastern Esplanade and the town generally. Several dormant sites have been developed with over £10m of new developments following its completion.

2.3 Income and day-to-day management is undertaken by Ventnor Haven Management, a subsidiary of Cheetah Marine. The funding shortfall at the haven will be reduced in time as income from the fishery under construction becomes due. This was initially deferred as part of the agreement with the developer. In addition Cheetah Marine has development proposals for the Eastern Esplanade, and this will significantly reduce the cost of their supervisory function. It is anticipated that within 2 years the Haven could break even.

2.4 Income at Ventnor Haven in 2006/07 is likely to be £12-£15k whilst haven management costs are £55k

BACKGROUND – RYDE HARBOUR

3.0 Ryde Harbour was constructed as part of the Ryde seafront development, which included the construction of the car park, coach park, the ice rink and LA Bowl. The tidal harbour was a later addition to the overall scheme with construction commencing in 1990 and an official opening in July 1991.

3.1 The harbour occupies an area of 1.8 hectares. It has half-tide access and can accommodate approximately 160 boats –currently a mixture of long-stay, permanent and short-stay/overnight visitor berths.

3.2 Income is collected throughout the year by the harbourmaster through the provision of permanent and visitor moorings. Unlike other harbours income is not received from any other sources to support the operation. The demand for permanent moorings is greater than the available mooring spaces.

3.3 Income from visitor moorings for 2005/06 was £16,090 and permanent £36,702 with £969 of vending income. Further income could be realised through the provision of additional finger pontoons as identified in a recent business case.

3.4 Total income from Ryde Harbour is £53,761 and direct expenditure is £47,459 giving an operating surplus of £6302. With the addition of centrally controlled charges the harbour operates at a net deficit of £40,884.

3.5 Since the Harbour’s construction in 1991, annual maintenance dredging has been carried out to remove the accumulation of silt and beach material from around the entrance to the Harbour and the area adjacent to the harbour arm. It was also necessary to carry out major dredging during 1994 and 2002 to remove silt from the whole Harbour basin and entrance channel. These operations cost over £200,000.

3.6 As a result of 3.5 and a report prepared for the councils Coastal Manager, options for the future of the harbour were prepared the Strategic Asset Management group and are currently being considered by this group.

STRATEGIC CONTEXT

Newport Harbour, Ventnor Haven and Ryde Harbour are strategically important assets with potential to support waterside and maritime regeneration. At Newport and Ventnor in particular the development of landward facilities will help to develop additional income and there are proposals in hand for both locations, subject to planning and detailed appraisal.

FINANCIAL IMPLICATIONS

The details of trading operations for harbours are attached as Appendix A.

LEGAL IMPLICATIONS

The Council is the statutory harbour authority for Newport harbour and Ventnor Haven and has appropriate responsibilities to fulfil in addition to Health and Safety requirements.

EVALUATIONS

Newport Harbour has greatly improved over recent years as its role has changed from freight handling to more of a leisure facility. Whilst the general environment has improved the level of income has declined and buildings which previously contributed to the revenue account have been turned to alternative uses.

The Harbour needs significant investment if it is to maximise its potential and this is being explored as part of the regeneration of the Medina Valley. The repairs to the harbour walls and capital dredging are being explored as part of a larger scheme which will look to add value to the development opportunities by creating deeper water.

Ventnor Haven requires further harbourside private sector investment if it is to break even and proposals are at a fairly advanced stage but subject to planning approval.

RECOMMENDATION

To note the report.

APPENDICES ATTACHED

Appendix A – Details of trading operations

CONTACT DETAILS

Dr Robin McInnes OBE, tel: 857220; e-mail: [email protected]

Astrid Davies, tel: 3825; e-mail: [email protected]

DEREK ROWELL Director for Regeneration and Development

COUNCILLOR IAN WARD Cabinet Member for Environment, Planning and Transport