One of the reasons the city of Newport Beach claims that it must increase the rents on residential piers is due, in part, to SB 152, a bill authored by California State Senator Fran Pavley. However, Pavley’s office tells me it doesn’t apply.
You can read more about SB 152 here and here. It required the State Land Commission to charge fair market rents for piers that it manages. But the bill made no mention of Newport Beach (as opposed to nearby Huntington Harbour) when it was being discussed, as you can find on Pavley’s site.
I contacted her office noting that Newport Beach wasn’t listed and asking if the senator felt whether property taxes already paid by pier owners should be taken into account in setting fair market rates. I got this response back from her spokesperson Liz Fenton:
Newport Beach’s proposed action does not have anything to do with SB 152. A quick read of the Newport Beach FAQ on Rental Rates for Residential Piers in Newport Harbor [see here] shows: “The obligation to charge fair market rental value is in the California Constitution (Article XVI, Section 6), in the Newport Beach Municipal Code, and in State law (the ‘Beacon Bay Bill’).”
According to the §17.05.080 of the City of Newport Beach Harbor Code, the Beacon Bay Bill was Chapter 74, Statutes of 1978. That bill (AB 1422, Cordova) granted the City of Newport Beach title to the tide lands and submerged lands subject to certain conditions. One of the conditions is that the lease of tide lands and submerged lands must be at the fair market rental value.
It appears that the City of Newport Beach is simply attempting to comply with 35 year old legislation.
The FAQ page actually does have the city citing SB 152, like this:
A law passed in 2011 (SB 152, Pavley) directed the State Lands Commission (SLC) to begin charging fair market rental value to residential or recreational piers up and down the state. The State Lands Commission is the agency that oversees our City’s administration of the State tidelands of Newport Harbor. They are, in effect, our landlord. If you look to the State Lands Commission’s website and review recent and upcoming agendas, you will see significant activity involving changes in rent in Huntington Harbor and other places where the SLC controls recreational piers.
The city has repeatedly cited SB 152’s provisions to justify its change. It doesn’t rely solely on this, but certainly it seems it should stop citing this particular bit of legislation.
As for the Beacon Bay bill, the folks at Stop The Dock Tax, in reading through my previous post and the city’s reliance on that legislation to raise rates, said this:
The Beacon Bay bill calls for charging “fair market value” rent only on the residential parcels of Beacon Bay! Kiff has consistently said the Dock Tax increase is required by the Beacon Bay bill, an incorrect statement.
My past articles on this topic:
- The Dock Tax: Why The Newport Beach Boat Parade Is Being Boycotted.
- What’s A Fair Market Rate For Newport Harbor Residential Piers?