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IYBA urges Congress to end foreign-flagged yacht sales restrictions

Posted on May 12th, 2017 Written by Reagan Haynes

Staley Weidman, chairman of the International Yacht Brokers Associations legislative affairs committee, is shown with U.S. Rep. Lois Frankel, D-Fla., when a similar bill was introduced in 2015.

Staley Weidman, chairman of the International Yacht Brokers Association’s legislative affairs committee, is shown with U.S. Rep. Lois Frankel, D-Fla., when a similar bill was introduced in 2015.

The International Yacht Brokers Association is hosting a media event today with U.S. Rep. Lois Frankel, D-Fla., to reintroduce a bill to alter an 87-year-old law that prevents sales of foreign-flagged yachts to U.S. citizens while the boats are in U.S. waters.

“It’s garnering more support all the time, but several supporters last year weren’t re-elected,” IYBA executive director Cindy Sailor told Trade Only Today. “This is the 115th Congress. Some people didn’t get re-elected, so she has to reintroduce the bill every time there’s a new Congress.”

The bill, now introduced as H.R. 2369, seeks to change the Tariff Act of 1930, which requires foreign-flagged boats to pay an import fee prior to being sold in U.S. waters. The bill would not remove the tax paid on the boat, but would defer payment of it until after the boat is sold.

“We’re not trying to get any sort of forgiveness for paying the duty. It’s just at the point of sale, rather than when it goes on the market,” Sailor said.

The way it stands now, the tax is paid on the value of the boat rather than what the seller actually gets for the boat.

“It’s counterintuitive to pay the import tax before you can even offer it for sale because you don’t know what the actual selling price is going to be,” Sailor said. “A 1.5 percent tax is sizable, and most people don’t want to pay that just to put the boat on the market.”

That means lost sales in the United States, which the IYBA says translates to lost jobs and revenue.

“Within the first year of a boat owner buying a boat, they usually spend about 13 percent of the value of the boat in the first year on refits, getting it updated somehow,” Sailor said. “Bottom paint, or some kind of refit, or replacing textiles. That’s typically the rule of thumb. People want to put their touch on their new boat.”

If foreign-flagged boats are discouraged from coming to the United States for sale, that revenue will wind up elsewhere, the IYBA says. “And if a Canadian walks onto the docks, he can buy that boat. But if an American wants to buy the boat, they can’t. They can’t even look at it because it’s not been imported yet,” Sailor said.

Two groups will be heading to the American Boating Congress next week to garner support from Congress, Sailor said. “There will be seven of us total, plus some people from the California Yacht Brokers’ Association. We’ll be visiting with representatives and burning up shoe leather while there to discuss what deferred importation means and why it translates into jobs.”

“Studies show that implementation of deferred importation would generate thousands of industry-related jobs and encourage $2.46 billion in additional U.S. recreational marine sales and economic activity,” Staley Weidman, chairman of IYBA’s legislative affairs committee, said in a statement. “It’s time to remove this onerous restriction, which prevents job creation and discriminates against U.S. residents while in their own country.”

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State Street Marketplace Vendors Unveiled

Only one vendor spot remains unclaimed in downtown Traverse City’s State Street Marketplace, a new marketplace and craft brewery site set to open in June across from the Park Place Hotel. The Ticker has an exclusive first look at the lineup of restaurant and retail tenants coming to the property, plus updates on planned expansions into Traverse City by Mammoth Distilling and Walstrom Marine and several other local business openings, closings and moves.

State Street Marketplace
Michigan native Kevin O’Donnell calls the lineup of tenants slated to debut in his State Street Marketplace “better than we could have imagined” when he first announced project plans for the former Master Dry Cleaners site last October.

In addition to anchor business Monkey Fist Brewing Company, a 4,500 square-foot craft brewery, three new restaurants and several retail tenants will occupy the State Street Marketplace. Olives Wine owner Ari Mokdad is set to open Ziatun, a Lebanese-influenced restaurant featuring a variety of Mediterranean dishes including shawarma shaved off the spit, according to O’Donnell. Chef Adam McMarlin of The Cooks’ House will helm Wren the Butcher, an eatery focusing on “sausage and other gourmet items,” O’Donnell says. Francisco’s Market Deli owners Mike Krenzke and Adam Inman will launch F-Que, which will serve up pizza, burgers and BBQ. “It’s going to be a new unique concept based on three different flavor profiles of regions of food,” says Inman. “The burgers will be something Traverse City has never seen before.”

On the retail front, owner Karen Hilt of My Secret Stash will operate a double booth featuring a selection of her “made in Michigan” gifts and retail items, as well as Monkey Fist Brewing Company and State Street Marketplace-themed merchandise. New business owner Jenny Cesolini will sell vintage clothing, accessories and gifts at Waxwing Vintage. “I’m carrying mostly women’s clothing, but I have a few men’s and children’s pieces, and also a growing selection of items like bar sets, planters, glassware, jewelry, handbags and hats,” Cesolini says. Rounding out the tenants is Troy Daily, who will host a space for his Paddle For Pints and Brew Bus businesses offering tour bookings, end-of-tour events, photo booths, merch and more.

Retail tenants will be open at least 11am-7pm Monday-Saturday and 11am-6pm on Sunday, while restaurants will operate “later into the evening,” O’Donnell says. “(Tenants) can be open as late as midnight if they want” – the time until which the brewery will operate. Tables and seating will be available throughout the indoor “open-air” concept marketplace. State Street Marketplace is targeting a soft opening the weekend of June 10-11, according to O’Donnell.

Fresh Coast Chocolate/Mammoth Distilling
Central Lake’s Mammoth Distilling could soon be making its mark on Traverse City. Owner Chad Munger will appear before Traverse City commissioners Monday to request a small distillers license for a proposed new location at 221 Garland Street, Suite D – currently home to Fresh Coast Chocolate. Fresh Coast, which is temporarily closed, hopes to share the space with Mammoth and a potential third future partner that would bring a restaurant component to the property.

“Our vision is to open a full tasting room with cocktails and a full commercial kitchen, which will produce food for our tasting room in Central Lake,” says Munger. “We’re looking for a partner to run a full restaurant. Nichole (Warner, owner of Fresh Coast) will continue to make chocolate, so it will be a really unique combination of businesses.” Warner says the deal – which is contingent on commission approval of the license, though it has been reviewed by city police and is recommended for approval by city staff – “is going to allow us both to create a really unique experience for our customers with paired tastings, event and educational opportunities with a focus on craftsmanship and quality.”

Walstrom Marine
Boat sales and service center Walstrom Marine – which has locations in Harbor Springs, Bay Harbor and Cheboyan – is coming to Traverse City. The company will showcase 19-foot to 65-foot Sea Rays as well as lineups from Tiara Yachts, MJM Yachts, Chris Craft and Pursuit Boats at its new showroom, now open at 3536 N. US-31. Walstrom Marine is joining the Harbor West Yacht Club to “establish an on-water presence for larger boats and demonstrations,” according to a company release. Former sales manager Rick Venner will serve as general manager of the Traverse City store.

In other local moves…
Despite “store closing” signs on the doors of Gander Mountain in Traverse City, the business is slated to stay open. The company was purchased by competitor Camping World Holdings Inc. after filing for bankruptcy this spring. As part of the restructuring, Gander Mountain must liquidate its entire existing inventory. But Camping World CEO Marcus Lemonis announced plans this weekend to keep at least 70 stores open, including Traverse City’s. “The current liquidation of the existing Gander Mountain inventory will allow us to start with a clean slate of what we consider the appropriate mix and level of inventory, including the addition of Camping World and Overton’s offerings where appropriate,” Lemonis said in a statement.

Buffalo Wild Wings will host a grand reopening today (Friday) following a remodel of the restaurant’s interior at 3480 South Airport Road. Renovations include an “updated interior and an updated AV system…in a refreshed atmosphere” that will offer a “high-energy stadium experience,” according to CEO David Burke of Diversified Restaurant Holdings, which operates the restaurant. The first 100 guests through the door today for the grand reopening will receive free wings for a year.

Pets Naturally has acquired the D.O.G. Bakery and will be relocating the business to a new addition under construction at the existing Pets Naturally location at 1420 South Airport Road. According to Pets Naturally owner Kathy Hyland, key staff members of D.O.G. Bakery will be moving to the new location to continue baking and decorating, and all existing D.O.G. customer loyalty programs will be honored. D.O.G. Bakery will close its downtown location on Saturday (May 13).

A new jewelry shop is opening at 130 Hall Street. Traverse City Light Power board members approved a lease Tuesday for Gold and Jaye Jewelry to occupy the 1,500 square-foot space beginning May 12. According to a TCLP staff report, Gold and Jaye Jewelry – owned by Jennifer Anderson – is a “local company that has been in business primarily online through the Etsy website (and) plans to expand by providing a retail storefront with jewelry repairs and custom-made jewelry.”

Longview Winery has closed its doors at 8697 S. Good Harbor Trail in Leelanau County. Owner Alan Eaker announced the closure on the company’s website. “Thank you for all of your support and sharing in this experience with us,” Eaker wrote. “After many years of making wine, we have decided it’s time to move on and check another adventure off our bucket list. Leelanau Peninsula is a beautiful area blessed with ideal conditions for grape growing, so although we may be gone, please continue to enjoy this region and what it has to offer.”

Finally, two new retail stores are coming to the west side of Traverse City. Scrapbooking store Bayview Scrappers held a grand opening celebration last week at its new location at 3337 South Airport Road, Suite 1 in the Grand Traverse Commerce Centre. The store will offer a full range of scrapbooking products along with regular “crops,” or scrapbooking events. Party Giant, which recently announced the upcoming closure of its Division Street location, has signed a deal to relocate the business up the road to Buffalo Ridge Center on US-31. The new store will open in mid-June. Meanwhile, Ben Franklin is hosting a going-out-of-business sale at 1110 East Eighth Street. The store’s final closing date will depend on inventory clearance sales, according to staff.

Pictured: Construction underway at the future State Street Marketplace


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