Miami Hoping to Ease Up Cruise Line Guarantees in Support Push

PortMiami is continuing to step up to help the cruise industry, as the officials hope to push through regulations to alleviate cruise lines of minimum passenger guarantees during their recovery phase.

Already waving fees for ships docking for technical and crew repatriation reasons, the port hopes to relieve cruise lines of their minimum annual passenger guarantees, according to a document submitted Miami's Ports and Tourism Committee. 

This would come in exchange for the cruise lines to "maintain or increase their PortMiami market share relative to other U.S. ports in terms of passenger volumes and/or (2) to guarantee vessel calls; and (3) on a cruise line by cruise line basis, to meet any other additional conditions required by the County Mayor or County Mayor’s designee, if any, in his/her discretion (i.e., return of available weekend berthing rights, modifications to the scope of the County-funded components of construction projects or other County borne construction-related obligations, etc.)."

Cruise lines will be required to pay dockage and wharfage at their minimum contractual rates or those published in Port Tariff No. 010 (tariff rates for the Fiscal Year 2020-21 are $13.12 for wharfage and $0.405 per gross registered ton for dockage), in both cases subject to a 3% annual rate of escalation, according to the documents submitted.

"The passenger shortfall and surplus accounts shall not apply during the Recovery Period, nor shall any additional credits accrue during any portion of the Recovery Period; and Any parking-based incentives granted under their respective preferential berthing rights or terminal usage agreements will be waived throughout the Recovery Period."

The port said it expects the Recovery Period to last up to 24 months.

Of note, the port explained the fiscal impact through the end of the Fiscal Year 2019-20 of the first phase of the Recovery Period is $55 million, consisting of forgone net revenues derived from cruise wharfage and dockage fees. This has been offset by $35 million in expense reductions resulting from the port.