Michigan City Port Authority approves 6% slip-rate increase, discusses credit-card surcharge to recoup fees

The Michigan City Port Authority on Oct. 6 approved a 6% increase in slip rental rates for the 2024 season and discussed imposing a credit-card surcharge or other pricing changes to recover rising transaction costs.

Board President Joseph Ferguson told commissioners the port is accruing “70 to $80,000 a year on having to pay credit card fees” and proposed several options to recover the expense, including adding “3, 3 and a half percent of credit card purchases” for slip rental and gasoline sales or adjusting fuel pricing. Ferguson said staff would research legal and operational details and return with recommendations.

The discussion came during the authority’s finance and budget review. Ferguson summarized current bills and rising costs across categories including utilities, environmental services, insurance and equipment upkeep. He said the board faces higher operating expenses because of recent rate increases and computer-system limitations that have delayed budget work.

Board members debated the mechanics and fairness of different approaches. One member noted that fuel pricing formulas historically included markup to cover dock maintenance and related costs; another warned that adding a surcharge on pump transactions could double-charge customers if a fuel markup already accounts for card fees. A staff member suggested reassessing how fuel is priced before adding a separate line-item surcharge.

Ferguson said staffers had examined state guidance on surcharges and expected to return with an implementation plan. “Indiana merchants can implement surcharges up to 4% max,” a staff summary cited during discussion. The board directed staff to analyze federal and state legal limits, the share of card fees attributable to fuel versus slip rental, and operational impacts of applying a percentage surcharge at the pump or as a line-item for slip rentals.

On revenues, Ferguson proposed a 6% across‑the‑board increase in slip rental rates for next year to help cover rising costs. He presented the board’s estimate that a 6% bump would bring in about $110,000 in additional revenue. After a second and a roll-call, the board approved the 6% increase by unanimous recorded vote of members eligible to vote: Maynor (Aye); Liebel (Aye); Haynes (Aye); Cyphers (Aye); Ferguson (Aye). Two board members who hold current slip licenses were noted as not eligible to vote on the motion.

The board also approved payment of the month’s bills as presented; the total on the bills summary was $121,060.25. Ferguson walked the board through the largest categories on the bills list and answered questions about a recent credit-card terminal payment and advertising charges for the La Porte Herald Visitors Bureau.

Board members asked staff to: (1) prepare a legal/administrative analysis of whether and how to add a surcharge or alternate pricing mechanism, (2) break out how much of the current annual card-fee burden is attributable to fuel sales versus slip and service transactions, and (3) model alternatives (e.g., a pump-level surcharge, a change in fuel markup, or discrete surcharges for specified services). Ferguson said staff would return with a detailed recommendation for board approval before any surcharge is implemented.

Votes at a glance - Approval of Sept. 22 minutes — motion seconded; passed by voice vote. - Acceptance of monthly bills — motion by Joseph Ferguson; total $121,060.25; approved by voice/roll call as recorded in minutes. - Slip-rental rate increase — motion by Joseph Ferguson; seconded; roll-call votes recorded as Maynor (Aye); Liebel (Aye); Haynes (Aye); Cyphers (Aye); Ferguson (Aye). Motion passed. - Pavilion license agreement (2025) — motion to adopt lease agreement; passed by voice vote.

Why it matters: Slip rentals are the authority’s primary revenue source, and rising utility, insurance and maintenance costs are creating a budget gap. The board’s decision to raise slip rates and to study a credit-card surcharge or pricing changes aims to cover operating costs while staff develops implementation details and legal guidance.

What’s next: Staff will analyze legal constraints on surcharges, quantify card-fee exposure by revenue stream (fuel versus slip rentals and other sales), and return with a recommended administrative approach and proposed ordinance/fee language for the board’s future vote.