Long Beach's City Council will consider Tuesday whether to ask the Port of Long Beach and its Harbor Commission to take responsibility for the troubled Queen Mary and surrounding land.
Urban Commons, the company holding a 66-year lease for the ship and surrounding land, is part of a bankruptcy filing by Eagle Hospitality Trust. Officials have said the lease with the city of Long Beach will be auctioned off in the next month or so.
The landmark ship, its hotel, restaurants and meeting rooms have been closed since last year, primarily due to the coronavirus pandemic restrictions. The management company is the subject of an audit by city Auditor Laura Doud and is believed to be in arrears with its lease payments to the city.
Next Tuesday's agenda item was brought forward by Second District Councilwoman Cindy Allen, with support from Councilwomen Mary Zendejas (First) and Suzie Price (Third). The action would request the Long Beach Harbor Commission consider taking back operation of Pier H, which includes the Queen Mary, Carnival Cruise Lines terminal, hotels, restaurants and the Queen Mary Events Park (also called the Harry Bridges Memorial Park). That would include future development options, as well.
The city owns the Queen Mary — the port can take responsibility for it as the Harbor Department. That was the arrangement until 1992, when the City Council at that time took responsibility for the ship and surrounding 56 acres after the Walt Disney Corp. dropped its lease to operate the ship. The Harbor Commission at that time had considered looking for ways to get rid of the ship.
As part of the 2016 lease with Urban Commons, the City Council approved spending $23 million on critical infrastructure repairs on the ship, and Urban Commons committed $5 million to $7 million. That money was spent without completing the repair list when work proved more expensive than expected.
City Auditor Laura Doud announced in 2019 her office would audit that work. Wednesday, she said in a statement that Urban Commons had not provided basic financial records required to complete the audit.
At the same time, a proposal to develop the property around the ship was unveiled, without specifics regarding financing the development. It was the latest of multiple development proposals there.
"After repeated requests, Urban Commons did not provide their electronic check register, cash account detail, bank statements and cancelled checks, cashier’s checks, wire transfers or other payments made to vendors and subcontractors relating to the $23 million funded by the city," Doud said in her statement. "These records are critically important to the audit in order to ensure the accuracy and appropriateness of payments made by Urban Commons."
Allen said the port was better equipped to manage the landmark ship and surrounding property.
“Our superb team at the Port of Long Beach regularly manages international development contracts and capital projects with local, regional, and national significance,” Allen wrote in a release announcing the proposal. “Under the guidance of our Harbor Commissioners, who understand the local cultural significance of the Queen Mary and the regional significance of this development opportunity, the team at the Port is well-equipped to develop Pier H and secure the future of the important amenities and economic activities at this Pier for our community.”
Allen's item would have the Harbor Commission and City Manager Tom Modica review the proposal and report back in 60 days or less. The council meeting starts at 5 p.m. Tuesday as a teleconference. Go to lbtv3.com or longbeach.gov and click on the Meetings Live tab to log in to the meeting.
Note: This story was updated to include the statement from City Auditor Laura Doud.