Key West sightseeing tour contract finally OK’d

Key West sightseeing tour contract finally OK’d

BY PRU SOWERS

KONK LIFE STAFF WRITER

It took about three years but the city has approved a much-debated new contract for the sightseeing tour vehicle companies operating in Key West.

The 10-year contract leaves the franchise fee paid by Historic Tours of America (HTA), which operates the Conch Tour Train and Old Town Trolley, and CityView Trolley Tours of Key West unchanged from the previous contract. But the new version includes several clauses that were the subject of numerous debates, arguments and public workshops over the past three years.

Chief among them was the sound level coming out of the tour vehicles, which several residents along the tour routes had complained about. While the new contract only calls for the loudspeakers to be contained within the tour vehicle, tour operators have experimented with quieter loudspeaker systems over the past two years, installing new speakers that conform to city sound ordinances.

The new contract also sets limits on the number of vehicles each company can operate, a way to keep the ubiquitous tour trolleys and trains from overtaking city streets. HTA’s Old Town Trolley is limited to 36 vehicles while its larger Conch train can operate 20 vehicles. CityView Trolley is allowed 10 vehicles with permission to phase in another 10.

The franchise fee paid by the operators to the city remains unchanged at five percent of gross revenue per vehicle or $7,500 a year, whichever is greater. Last year, franchise fees paid to the city totaled approximately $600,000.

One point of contention over the long negotiation process concerned advertising on the tour vehicles. The sightseeing companies have increasingly put billboard-type posters advertising local businesses on their vehicles, drawing complaints from residents offended by what they described as commercial eyesores traveling city streets.

City officials initially proposed taking a percentage of advertising sales, something the tour operators vehemently protested. The final agreement lets the operators keep all the revenue but no more than 20 percent of a vehicle can be covered with ads.

One clause in the 30-page franchise agreement caused last-minute concern for some residents who spoke at the June 20 city commission meeting where the agreement was unanimously approved on first reading. Language in the agreement allows all the tour companies to operate “Ducks,” the amphibious sightseeing vehicles that travel both on land and water. Residents have spoken heatedly against the oversized Ducks at previous meetings. Mark Songer, head of local environmental group Last Stand, took the podium again at the June 20 meeting.

“Last Stand members are appalled that there is a possibility that these vehicles, which have a questionable safety record, may soon be endangering our residents and visitors,” he said.

Local resident Jack Anderson agreed, pointing out that while the U.S. Navy effectively cut off Duck Tours when it denied civilian boat access to Key West harbor in 2013, things could change under the new Trump administration.

“If we lose the restrictions on our harbor, what’s to say somebody doesn’t reinstitute these duck tours,” he asked.

But City Attorney Shawn Smith assured the speakers that while the new franchise contract does allow duck boats, the language was in there only to prevent a possible lawsuit. CityView Trolley Tours also owns a company called Duck Tour Seafari. Although no duck tours are currently operating in Key West because of the Navy harbor restriction, legally the city had to give all franchisees the same rights as Duck Tour Seafari.

When CityView Trolley first attempted to win a duck boat franchise in 1995, it was stopped by the city and HTA, which had already won a duck franchise in addition to operating the Old Town Trolley and Conch Tour Train. A lawsuit filed by the former owner of CityView, John Murphy, alleged that HTA and the city forced Duck Tour Seafari out of business because of the exclusive sightseeing franchise agreement the city had with HTA.

The courts ruled that agreement violated antitrust laws, resulting in an undisclosed settlement between HTA and Seafari Duck Tours. Key West followed with its own $8 million settlement in April 2010 and in January 2013, city commissioners approved the Duck Tours Seafari franchise agreement that remains in place despite the Navy closure of the harbor.

Because of the lawsuit, the city legal staff put language in the new franchise agreement that specifically does not outlaw the ducks, hoping that if every franchisee can operate a duck tour, none of them will because of competitive pressure.

“Nobody’s going to do ducks because they are very unprofitable,” said Commissioner Richard Payne. “Neither of these franchisees, you couldn’t pay them to run the duck tours.”

“I don’t want to equate this to a nuclear arms race but kind of what Judge Payne says goes along that logic,” Attorney Smith said.

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