Written by Jesse Scheckner on February 9, 2021
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As the pandemic rages on, passenger ships remain in Port Miami. Cruise companies have canceled their sailing plans until at least the first third of 2021.
According to Andy Hecker, Managing Port Director, internal savings, heavy freight traffic and cheap financing have allowed PortMiami to continue operations and cover costs including debt servicing on bonds without taking advantage of the savings until the end of the fiscal year.
“The department’s new deadline is between September and October 2021,” he told Miami Today via email.
That was five to six months ago when former deputy mayor Jack Osterholt first forecast the port would get into financial trouble. Despite losing hundreds of millions of dollars to a floating marine tourism industry, Port Miami has survived without delving into its $ 114 million reserves, including cutting non-essential spending and downsizing several massive terminal projects.
The port would have money problems, said Mr Ostertholt late last year, if cruise ships did not operate at full capacity by April 19.
Mr Hecker said that PortMiami’s “robust financial modeling tool” now shows that the port has slightly greater financial headroom due to several factors, some of which were triggered by the pandemic itself.
“The amount of cargo has set records every month,” he said. “The department’s debt service for its floating rate has resulted in interest costs below 1%. Remote workers have reduced overhead costs, including utilities and consumables. “
Earlier this month, Mayor Daniella Levine Cava said she extended the berth and port fee waiver for the county’s cruise partners until March 31. Her predecessor, Carlos Giménez, set the guidelines last March.
The waived fees, which include passenger guarantees and other recurring payments that cruise lines with berth or operating agreements here typically have to pay, add up to a monthly shortfall of $ 7 million for the county.
The commissioners approved the exemptions without comment on October 20, 2020. In a worst-case scenario in which passenger ships remain docked for more than two years, the port would lose previously guaranteed revenue of $ 285.5 million.
In return for the rescue operation, Miami-Dade only demanded that cruise ships continue to guarantee ship calls in Port Miami, maintain the passenger volume here compared to other US ports and possibly meet other requirements “on a cruise line basis,” wrote Osterholt.
To cover the $ 68.5 million lost between March and November, PortMiami has frozen hiring, eliminated overtime and suspended marketing, non-essential capital projects and freight incentives.
Ms. Levine Cava, in her February 3 statement, said Miami-Dade “will continue to support our cruise partners in these unprecedented times,” adding that she knew the industry will recover more strongly than ever when we recover and rebuild our economy over the coming months. “
Carnival Cruise Line, Royal Caribbean, Norwegian, Celebrity Cruises and Disney Cruise Line have all announced that they will not be sailing before April 30th.
MSC Cruises, which signed a 62-year, multi-billion dollar deal with the county in 2019, including plans for a $ 300 million mega-terminal that will also serve Disney ships, canceled cruises until April 30 or later.
Virgin Voyages said it wouldn’t sail until May. The maiden voyage of his first ship, the Scarlet Lady, was originally planned for April 1, 2020.
