Tauranga City Councillors have knocked back a $3million proposal to develop the marine precinct in the Mirrielees Road area.

In making the decision based on a staff report the council acknowledged it would be a long term investment with no financial return in the short term.

Marine precinct concept plan.

Lease holders of sheds in the development are being offered relatively short leases of only five plus five years, making them difficult to achieve a return on investment on.

The staff report heard by councillors presented the recommendation of an agreement in principle for a ‘basic' development of a hard stand area and 300 tonne travel lift.

It also sought an approach be made to the Bay of Plenty Regional Council for the remaining $3-5million.

The city council and economic development agency Priority One have for several years been trying to float the marine precinct concept for council waterfront land in Mirrielees Road.

It has failed to attract any backers.

The issue is understood to be tenure; council will not sell, but has so far failed to offer a sufficiently long term lease that will allow a private investor to make a return on an investment of several million dollars.

The council staff report recognises that while the travel lift and hard stand will create an immediate income, a full financial return on the investment is not expected in the early years.

Councillor Bill Faulkner says the investment is needed to replace the former 600 tonne slip that was removed to make way for the second harbour bridge.

'Since the slip closed there's been a significant lessening of the industry in Tauranga to the point where if we don't do something now, we are going to lose all of those little trades that keep boats going,” says Bill.

The travel lifts at the marinas handle the pleasure boats of up to 35 tonnes.

The bigger boats that would use the 300 tonne travel lift are instead departing for Nelson, Auckland and Whangarei.

'If we can get this thing off the ground we can restructure the marine industry in Tauranga.”

He favours the airport runway analogy used in the report.

'Nobody in their right mind invests in a runway on its own, it's the ancillary benefits,” says Bill.

'This precinct will offer the same incentives to the marine industry.”

The proposal to pay for the precinct from the sale of Glasgow Street properties and the Placemakers site was opposed by Wayne Moultrie.

Those sales were announced as a way of reducing council debt to instead invest that in a project that at face value does not seem to generate a return will be misleading ratepayers, says Wayne.

The motion to support the precinct in principle was lost on the vote.

Mayor Stuart Crosby and Councillor Terry Molloy were absent.