Revenue generated from a recent auction of beach equipment rental franchises declined for a second year in a row.
On Monday, as part of its consent agenda, the Ocean City Council voted to award contracts for 33 south-end parcels and one north-end parcel to five bidders wishing to rent umbrellas, chairs and other equipment to beachgoers next season. The auction, held Dec. 3, brought in $874,500, or 16% less revenue than the last round of bidding for south-end parcels.
Currently, the city franchises 70 beach equipment parcels spanning the entire Ocean City beach, with the parcels divided into three sections – south end, mid-beach, and north end.
Each year, one of those three sections is auctioned off, with the highest bidders receiving a three-year contract to rent umbrellas, chairs and other equipment on the beach. The city’s code also provides one option for first-term contract renewals at an annual fee of 10% greater than the initial term.
This year, south-end parcels, from the inlet to 27th Street, were scheduled for auction. Of 34 south-end parcels, 33 were auctioned, as only one first-term contract was renewed for a second three-year term. One north-end parcel, between 128th and 130th streets, was also included in the auction, as the current franchisee will terminate their agreement with two years remaining on the current contract.
In presenting the auction results to the council Monday, City Clerk Diana Chavis reported that overall revenues declined 12%, as the city currently collects more than $1.2 million from all of its parcels.
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