Discovery Whale Watch

Discovery Whale Watch co-owner John Mayer.

In early March, John Mayer and Matthew Arcoleo, joined by another four crew members, flew to Washington. There, they boarded a whale-watching boat, the Island Explorer 3, and spent four days driving that boat 1,000 miles south along the coast, back to Monterey Bay. 

"We were running fast, all night and all day," Arcoleo says. "We were between storms."

There was urgency on that end to buy the boat, the type of vessel that doesn't often come up for sale, especially in good condition. Even at $1.2 million—and even without a deal worked out on where to dock that boat back home—they say the available boat was too good to pass up.

"You don’t just find these on a used car lot," Arcoleo says.

But now, more than a month later, the Island Explorer 3 still has no permanent home. Arcoleo and Mayer can see it from where they operate Discovery Whale Watch on Fisherman's Wharf, docked just across the harbor at the Coast Guard Pier, where they're paying $200 a day to keep it for now. And they're doing battle with the seller, who expected them to pay off the boat in three summer seasons worth of whale-watching trips. 

But Arcoleo and Mayer say that without their landlord—that's the city of Monterey—letting them dock that boat on their section of Fisherman's Wharf to put it into business, they stand not only to lose lots of whale-watching business, but also to lose their boat. They say the seller will repossess the boat effective May 1 if there's no agreement with the city, and that looks unlikely. 

At issue is whether Discovery has room to dock the Island Explorer 3 given the terms of their lease. (There's also the issue that City Council has not yet voted on whether to approve the increase in boat size, which they are expected to vote on this month, but which would not resolve the lease dispute.) 

"Our position has been communicated to them many times, even before they did a lease to purchase the new boat," says Monterey City Attorney Christine Davi. "Their leased space doesn’t have sufficient space for that sized boat."

In Arcoleo and Mayer's read—as well as a read by Central Coast Engineers, a firm they hired—their lease from the city includes 100 feet of water space. But the city's take is that they have just 78 feet—not big enough to fit the new boat, bigger than their three smaller boats.

The Discovery Whale Watch co-owners say city officials are misreading the wharf concession map when it comes to water space versus dock space above, and that if they're forced to relinquish the Explorer 3, they'll lose $31.4 million in prospective revenue, accounting for unsold tickets and merchandise.

That's according to a claim they filed on April 25 against their landlord, the city of Monterey. A claim is a precursor to a lawsuit; the City Council is expected to discuss their claim at a meeting on May 7 or 21, but either way, that's after the May 1 deadline with the boat vendor.

In an April 15 letter, their attorney, Christine Kemp of Noland, Hamerly, Etienne & Hoss, urged city officials to act fast: "Make no mistake about it, this is an emergency," she wrote. "They need a solution in a matter of days—not weeks or months."

In a reply letter, Davi wrote, "The city notified your clients multiple times in December 2018 and January 2019, months in advance of their lease to purchase the Island Explorer 3, that Concession #19 did not have adequate space to accommodate a larger vessel.

"Nonetheless, in March 2019 the vessel arrived in Monterey's harbor. Now your clients must deal with the fallout of their own reckless action."

Mayer and Arcoleo maintain their lease gives them a full 100 feet of space, and that the city has double-leased the same stretch of water space to Discovery and to Tony Rappa, whose subtenant, Monterey Bay Sailing, operates from a floating dock next to the wharf. (Moving that floating dock would give enough space for the Island Explorer 3.) 

"It’s a presumptive play on their part to just do this—it’s easier to ask for forgiveness than permission. That was apparently their business strategy," Davi says. "They undertook the initiative without permission, hedging their bets it would work or we’d find alternate space somehow."

For their part, Mayer and Arcoleo say when they signed the lease in 2017, their business plan from the outset was to get a bigger whale-watching boat. Smaller vessels, like the 50-foot New Horizon, take passengers out on day-long fishing trips. To compete with their neighbors on the whale-watching front, they've been looking to get a bigger, more comfortable boat outfitted with a cushy interior.

"If we lose the boat, [we lose] possibly hundreds of thousands in attorneys fees, and we lose the ability to ever, ever be competitive," Arcoleo says. 

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