The long-held tradition of transferring offshore mooring permit ownership in Newport Harbor might be ending after state leaders found the practice could violate state law and recommended eliminating it.
But advocates say the recommendation could impact people who’ve invested tens of thousands of dollars in the current system — while proposed rate hikes could also force some people who live on their boats out of Newport Harbor.
Now, the decision on mooring permit transfers rests in the hands of city officials after receiving recommendations from the California State Lands Commission. There is no clear timeline yet when city leaders might consider formal changes to the mooring program.
There’s a community of boaters in Newport Harbor who pay monthly rates to maintain an offshore mooring permit. These permits give people a designated place to store their boats in Newport Harbor when they aren’t in use, with some residents using the boats as an affordable place to live.
While residential piers on waterfront properties are connected to land, offshore moorings are in open water — forcing permit holders to use a kayak or dinghy to access and board their larger vessel.
Mooring permit holders have spent the past couple years protesting rental rate spikes for their boat storage spaces in the harbor — after the city proposed increases that would cause some people’s monthly payments to quadruple.
[Read: Newport Beach Harbor Commission Recommends Spiking Boat Mooring Rents]
After mooring permit holders in Newport Beach asked California State Lands Commissioners to take a look at proposed rate increases to store boats in the harbor, commissioners found the appraisal used to justify the rate spikes could be relied upon.
While state lands commissioners called out that rates for residential pier rates seemed too low, they found no issue with the city’s proposed rate hike for offshore moorings.
[Read: State Officials Find No Issue With Newport Beach Offshore Mooring Rate Hike]
State lands commissioners also called out another potential issue, this time with transferability, finding that the common practice — oftentimes, the only way to obtain a permit — may violate state law.
Will Newport Beach End Offshore Mooring Permit Transferability?
The most common way to obtain an offshore mooring permit in Newport Harbor is through private transfer — usually accompanied by a sale price of tens of thousand of dollars.
Permits can also be transferred to family members, usually without any cost.
The three members of the California State Lands Commission discussed Newport Beach’s management of the harbor during a meeting on Dec. 16.
According to the staff report included with the commission’s agenda, a 40-foot mooring permit typically sells for about $40,000 to $60,000.
The staff report also says that the private sale of permits “appears to violate” the city’s grant statutes, fiduciary obligations to the state and the Public Trust Doctrine.
“Regardless of how much revenue the transfer fees might generate, revenue generation does not justify or excuse actions or programs that are legal violations,” reads the staff report. “Additionally, staff does not agree that the permit transfer fees are particularly high or result in significant revenues for the City’s Tidelands fund.”
“The large disparity between revenue the City receives from transfer fees and the total value of mooring permit sales is one of the indicators that the mooring transfer program violates the City’s obligations under its grant statute and fiduciary duties, and could be an unconstitutional gift of public funds,” the staff report continues.
State lands commission staff also voiced concern about how the transfer program gives current mooring permit holders too much authority to set prices and choose who receives their permit next.
“The transfer program allows the group of current mooring permit holders to control the recipients of the mooring permits and potentially extract value from the process,” reads the report. “The transfer program is therefore for the benefit of the group of current mooring permit holders and not for the general public that wishes to acquire a permit.”
The report recommends that the city end its program allowing private mooring permit sales.
Newport Beach City Manager Seimone Jurjis said the city has recently received the official report from the State Lands Commission.
“We also had a productive conversation with the State Lands Commission staff,” he wrote in an email on Jan. 20. “We are still discussing internally on our compliance plan.”
Mooring Permit Holders Could Lose Thousands If Transferability Ends
Since most people who currently hold an offshore mooring permit purchased it for tens of thousands of dollars, boaters are worried that they might never be able to recoup those costs if transferability ends.
Anne Stenton, president of the Newport Mooring Association, emphasized this point in an email after the commissioners’ meeting.
“The immediate impact of eliminating transfers would be significant hardship for current permit holders who made financial decisions based on the system that has been in place for years, procedures and processes they were compelled to follow, and which were approved and designed by the City,” she wrote. “The long-term impact will be less coastal access for ordinary boaters.”
Adam Leverenz, a mooring permit holder, said he’d be personally affected if mooring permit transferability is phased out.
Leverenz got his permit in 2023 via private transfer for about $30,000 after saving and planning for 15 years.
“I acquired it; I thought I was going to be able to come to Newport and relax and enjoy life, and within a few months, this all started,” he said.
State lands leaders acknowledged in their report that many current mooring permit holders purchased their mooring permits with the expectation that they would have the option to sell them in the future to make back some of the funds they spent originally.
“The City could consider ways to phase out transfers which recognizes that the current mooring permit holders were only following the City’s established rules when they purchased their moorings,” reads the report. “Commission staff is not taking a position on whether compensation should be provided to the current mooring permit holders.”
Angelina Hicks is the Voice of OC Collegiate News Service Editor. Contact her at ahicks@voiceofoc.org or on Twitter @angelinahicks13.