Courtesy of Dr. Paul Price
Originally published at Real Money Pro
Monday’s Philadelphia Inquirer ran a front page feature on the intra-state struggle over whether to keep the retired ship as a tourist attraction in its current Camden, NJ location or to move it to Liberty State Park alongside the Statue of Liberty and near historic Ellis Island.
The ship was relocated to Camden in 1999 after being brought through the Panama Canal and north to its present mooring site. The current operator, Home Port Alliance, still owes $900,000 on a $1 million loan originated in 2003.
Christopher von Zwehl, president of the USS New Jersey Battleship foundation, said his non-profit was working to raise $15 million from donors to make the move to Liberty State Park possible. He said that the Home Port Alliance has “had the ship in the best of times and the worst of times and couldn’t make it work. The amount of money needed it well above their heads.” von Zwehl called the ship’s Camden location a financial disaster and a “forgotten hulking relic” of a tourist attraction.
NJ taxpayers paid $1.7 million in aid to defray losses in 2010 but cut that amount to $32,500 last year due to statewide budget problems. The recently replaced CEO of Camden’s Home Port Alliance said that the state aid last year didn’t cover even one month’s electric bill.
The DPRA [Delaware River Port Authority] balked at renewing the historic site’s current loan guarantee for another three years due to their own budget deficits. They extended the old guarantees through April while they evaluated the likelihood that the bank would call in the loan leaving the DRPA on the hook for the remaining balance. The Home Port Alliance has been making interest only payments for a while without paying down any principal.
Total annual attendance peaked at approximately 200,000 in the ship’s first year but dropped to about 26,000 paid general admissions in 2011. Thus, the total revenues generated came to about $400,000 last year.
In a 2009 IRS filing the Home Port Alliance paid former CEO Schuck $117,458, marketing director Jack Willard $94,600, curatorial affairs official Jason Hall $64,444 and controller Ruth Keser $66,731 for a grand total of $343,233 not including FICA or benefits. In addition there was a staff of 40 full and part-time workers on the payroll.
Estimates for 2012’s expenses included $350,000 for maintenance, $600,000 on utilities, and $180,000 on insurance. An $8 million teak re-decking project is planned. Management justified this as, “Teak is expensive and hard to get.” They also indicated the desire to paint the hull and noted that “We could easily spend $40 million” to do things right.
Right now the yearly budget runs $3,000,000 but it is hoped that might be trimmed to just $2.6 million if fund-raising efforts pan out. Current management also hopes to snag part of the $2.1 million in the FY 2012 NJ budget set aside to help run historical sites including the battleship, the Old Barracks Museum in Trenton and the Morvin House in Princeton.
Clearly, any MBA student’s cost/benefit analysis would dictate closing down this political patronage, little seen attraction. Unfortunately, the only question actually being posed, though, is whether the spoils [read NJ taxpayer money] will continue to flow in Camden or will be moved to politically connected individuals closer to the NYC area.