Recreational Marinas in California

Division 1, Chapter 2, Article 5 of the California Harbors and Navigation Code deals with recreational marinas under the Department of Boating and Waterways.

Section 76 contains a statement of legislative intent that Harbors and Watercraft Revolving Fund moneys be used to provide loans directly to private recreational marina owners for the design, acquisition, development, expansion, and improvement of boating facilities. It is the further intent of the Legislature that borrowers receiving loans not charge unreasonably high boat berthing fees at their harbor facilities.

Section 76.1 defines the term “private marina owner.”

Section 76.2 defines the term “recreational marina.”

Section 76.3 authorizes the department to make loans to private marina owners to develop a recreational marina. Loan funds from the department may be utilized for two specified purposes. However, the department cannot make a loan to a recreational marina that restricts access or bars the public other than that which is consistent with general commercial business practices.

In addition, any private marina owner who purchases facilities previously developed with a department loan is eligible to apply for a new construction loan from the department. The department may also make a loan to a recreational marina for the purpose of refinancing an existing loan, subject to three specified conditions.

Section 76.4 requires an application for a loan to be filed with the department and meet four specified conditions. The costs of brokerage fees, planning studies, and all other costs for the preparation of the loan application are to be borne by the applicant.

Section 76.5 requires priority to be given to applications from qualified private marina owners who have not received previous loans from the department. If the department finds a proposed loan project is feasible, the loan request must be submitted to the commission for its advice.

Section 76.6 provides that loans made under this article must include at least seven specified terms and conditions.

Section 76.7 provides that all loans made by the department to private marina owners to be funded from the Harbors and Watercraft Revolving Fund. All loans must be repaid by private marina owners to the Harbors and Watercraft Revolving Fund. Private marina owners receiving loans made by the department cannot charge unreasonably high boat berthing fees.

Section 76.8 requires the department to adopt regulations to implement or make this article more specific, including standards for the approval of loans, which must include specified provisions.

Section 77 authorizes the department to borrow funds from the Harbors and Watercraft Revolving Fund when a borrower has defaulted from any financial obligation and funds are required to protect the security interest of the department with respect to any loan made. The funds borrowed under this section are to be repaid within three years from the date of the approval of the Director of Finance.

Section 77.1 allows the department to sell or otherwise dispose of property serving as collateral for a defaulted loan may operate, contract to operate, or let property involved in the default. All proceeds from any action of the department pursuant to this section must be deposited in the Harbors and Watercraft Revolving Fund and credited towards the repayment of the defaulted loan.