 | June 2007 edition |
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Drystack Permits, Working Waterfronts and Difficult Decisions for County / City Commissions 
Up front, this topic, with examples, is a hot potato and no one in their right mind tosses it out. So here goes: We have few appropriately zoned and advantageously located working waterfront properties left along our coast (and inland waters) and we need to understand and appreciate that the political and economic pressures to change the use options for these properties are huge. County Commissioners, Planning Boards, City Council Members, and Zoning Boards constantly receive requests by property owners (or upset neighbors) to make changes that reduce the likelihood that a water dependant boatyard, boat builder, marina, or drystack boat storage will stay or be constructed on the property. And it is understandably difficult for these elected and appointed citizen volunteers to deny these requests because of the intense pressures exerted and the well orchestrated appeals by attorneys and family advocates for the changes requested. Read more...
Economic Impact Study Underway for the NC Boat Building Industry
After several years of “almost,” we are finally getting survey of our 100 plus NC boat builders underway this summer. The objective is to appropriately use the information to show the strong economic impact driving our very robust NC boating industry (see the next article).
UNCW Cameron School of Business (our Boating Industry Services “host” school) and other UNCW faculty will be conducting the survey. We will notify each company and assist the survey team with making contact and scheduling meetings. Your help is, and will be, appreciated - Mike Bradley.
NC Boating Industry Figures at a Glance
North Carolina is viewed as #1 growth state for the boating industry. Although Florida maintains its position as the leader in total value of shipments, North Carolina has the highest rate of growth in shipments. By type of boat, North Carolina’s boat-building industry experienced 173 percent growth in outboard motorboats, 250 percent growth in inboard motorboats, and 246 percent growth in inboard-outdrive - sterndrive boats, from 1997 to 2002. Click here to see more NC boating industry figures...
The 2007 American Boating Congress Highlights
The NMMA's 2007 American Boating Congress held in Washington, D.C. May 6-8 and drew 276 registered attendees including representatives from several North Carolina companies. The event focused on government policies impacting our industry, including health of marine fisheries, water access and engine emissions standards. Several of the topics are critical to North Carolina boating industry including:
- Problem of nexus taxation for boat builders transporting boats across state lines (see article below)
- Ballast water issue set to face boaters (see article below)
- Energy legislation currently being mulled by Congress including bio-fuel concerns (see article below)
- Water access concerns (see article below)
A contingent of North Carolina boating industry representatives provided background on these and other issues in several NC legislators' offices including Representatives Robin Hayes, Walter Jones, G.K. Butterfield, Mike McIntyre, Howard Coble and Senators Elizabeth Dole and Richard Burr.
The Problem of Nexus Taxation for NC Boat Manufacturers
At issue: North Carolina boat manufacturers have had trucks of new boats stopped and impounded in pass-through states on the way to destination sales states. Example: One NC company had a truck of boats, on way to Maine, stopped in New Jersey. The truck was detained and the company was charged with a $750,000 back-tax bill by New Jersey - which claimed nexus status reasoning that the NC company sold boats in their state, regardless of whether these boats were the ones sold. The NC company paid a reduced, but still excessive amount of over $250,000 to free the boats and started legal efforts to reverse the nexus finding and recoup the money paid. In ensuing weeks, the NC company ran up over $100,000 in legal fees and was able to "settle" so that NJ kept over $40,000 and set up an ongoing annual fee for the nexus charge. The legal battle continues, but at least now our builder can travel through NJ without seizure of boats.
Learn more about the problem of Nexus taxation on your company...
"Stinger" Boat Transport Rule Changes May Require an NC Legislative Act
Boat transport trucks hauling more than one large boat and traveling NC highways have been stopped and the companies warned that the loads do not meet the NC "divisible load" requirements. The North Carolina Department of Transportation Permit Department has recently reconfirmed, that, according to NC law, "stinger" combinations used to deliver boats are "divisible" loads and thus will not be issued an Oversize/Overweight permit unless the load is not "divisible. This usually means one oversize or overweight item makes up the entire load. Read more about the rule change...
Ballast Water Issue Set to Face NC Transient Boaters
According to the NMMA, the unexpected impact of a court ruling brought by environmental groups to prevent the introduction of aquatic invasive species through commercial shipping ballast water may have a serious impact on all of recreational boating. The ruling struck down a 34-year old EPA regulation exempting effluent discharges in the normal operation of a (recreational) vessel. NMMA and most of the boating industry feels that Congress needs to pass a legislative fix codifying the exemption for recreational boats before the September 2008 deadline when boaters will be required to file for any effluent discharge such as engine cooling water, bilge water, gray water, deck wash, and even deck runoff. Read more...
Energy Legislation Currently Being Mulled by Congress Including Bio-fuel Concerns
Many concerns are focused on the increased use of ethanol in the nation's fuel supply, especially the effects of higher-level ethanol blends on marine engines. Mixtures above E-10 (ten percent ethanol) gum up or compromise fuel tanks, fuel lines, gaskets, or cause safety problems with marine engines, such as over-heating. Read more...
More on Small Vessel Use and Homeland Security
This is a follow up on our last newsletter's edition entitled "Terrorism fears could lead to total monitoring." According to Michael Sciulla, Senior Vice President for Public Affairs for BoatU.S., Department of Homeland Security and U.S. Coast Guard officials are busy preparing for a National Small Vessel Security Summit June 19-20. In recent months, proposals to license boat owners or require them to outfit their vessels with expensive electronic tracking gear have been floated. According to Sciulla, "Recreational boaters want to be part of a comprehensive solution to this threat but any new requirements must be measured in terms of both effectiveness and efficiency." Read more...
Tax Breaks and Loan Options for NC Working Waterfront Not Likely This Session
The Waterfront Access panel also recommended that fishing piers and other working waterfront properties be awarded "present use value" tax status, similar to how farmland is taxed. Since 1973, the report said, the state allows farmland to be appraised at its current use value - as a farm - instead of fair market value, shielding the owner from higher tax bills in a rising real estate market. But, according to the Carteret News-Times by Ben Hogwood, "… the General Assembly - which created the committee - appears to be taking its time to pick up on the recommendations. Rep. Pat McElraft, of Carteret, introduced a bill May 7 in the House that would have set aside $5 million from the state's General Fund to be used to acquire land in coastal counties to provide waterway access to the public; however, the bill was not picked up by the appropriations committee and she wasn't optimistic anything would happen with it in this legislative session. Unless the Senate comes through, it's probably not going to happen this year," she said. Land's not getting any cheaper," she continued. "It's time to ante up."
The North Carolina General Assembly was among the 2007 winners of the BoatUS Recreational Boating Access Awards. The only state to be honored, North Carolina is lauded for its creation of the state Waterfront Access Study Committee.
Michael Voiland, study committee chair and executive director of North Carolina Sea Grant, was asked to accept the honor on behalf of State Senator Charles Albertson and State Representative William Wainwright, co-chairs of the N.C. Joint Legislative Commission on Seafood and Aquaculture. The Access Award was created to honor a group, government body, business, individual or non-profit organization that has succeeded in preserving or improving public waterway access for boaters. Judging criteria included: how well challenges were overcome; the direct impact of the solution; and how adaptable the approach would be in other areas facing similar water access challenges. The Waterfront Access Study Committee's final report and recommendations can be found at www.ncseagrant.org/waterfronts. Contact: Ann Green of Sea Grant, 919-515-9070.
Good Suggestions from the Hurricane Preparation Symposium
The first Marina Hurricane Preparation Symposium, organized by BoatU.S. in conjunction with the Marine Industries Association of Florida and the Marine Industries Association of South Florida, shared tactics, tips and experiences with the goal of successfully managing another year of potentially increased storm activity. The most important task is to make a hurricane plan now and put it in writing; speakers stressed the need for facilities and individuals to have well thought out, written plans. Read more for things to consider for both boaters and marinas...
Boating Industry Services Program feature of NCBoatingLifeStyle Magazine
The NCBoatingLifeStyle Magazine featured our SBTDC Boating Industry Services and Mike Bradley in its March edition in a story titled "Boat Builders Flocking to North Carolina" by Bill Morris. Click here to read the Boating Industry Services article.
Summary on the National Symposium on Working Waterways & Waterfront
Jack Morrow of our Wilmington office attended the first National Symposium on Working Waterways & Waterfronts in Norfolk, Virginia from May 9 - 11, 2007. There were speakers and participants from the entire US including lawmakers from several states. The general topic was decreasing access to public trust waters for most citizens, and the disappearance of "working waterfronts." Click here to read the major points discussed at the conference.
MACT standards for Surface Coating of Vessels over 65 feet
This is just a "behind the scenes" note, but one that NC boatyards and builders working on boats over 65 feet need to keep an eye on. John McKnight of the NMMA Environmental & Safety Compliance group has been working with the EPA to try to support reasons why it is inappropriate for the agency to delete the definition of "pleasure craft" and amend the definition of "ship" to include surface coating operations of recreational boats over 20 meters (65.6 feet) in the Shipbuilding and Ship Repair (Surface Coating) Operations MACT ("Shipbuilding MACT") stating that Such amendments, among other problems, completely ignore the long-standing regulatory distinction established by EPA between "ship" and "pleasure craft," also known as a "recreational boat." The short version of this problem is that EPA, in addressing all boats over 20 meters is starting to "sidestep" the Boat Manufacturing MACT, specifically written for the pleasure boating industry, not the ship building industry.
North Carolina Clean Marina Program Expands
The North Carolina Clean Marina program is a voluntary initiative designed to recognize marina operators for their efforts toward environmental stewardship by implementing Clean Marina practices. Recent funding from the N.C. Coastal Non-point Source Program and N.C. Coastal Reserve created a position to support and enhance program growth. The new coordinator will travel coast-wide to market the program, certify new marinas, present educational workshops, create boater awareness and recertify existing Clean Marinas. Read more...
