Petaluma agreed to a new longterm lease with the state for the Petaluma Marina, even as the lack of river maintenance has sunk the facility’s finances.

The 20-year lease with the California State Lands Commission will offer more favorable terms to the city and allow it to recoup rents from people living on their boats in the marina.

The city inked the original 30-year lease for the 13.89-acre property adjacent to the Petaluma River near Highway 101 in 1988. The deal included a potential 10-year extension. But city officials said they could get a better deal by signing a new longterm agreement.

“We’d be better off going with a new lease than extending the old lease,” Public Works Director Dan St. John told the city council Monday.

The new lease lowers the city’s annual payments from $14,184 to $13,480. In addition, it will allow the city to collect rent from people who live on their boats. Currently 12 people live on boats in the marina, though the practice is unpermitted.

Jason Earl, a management analyst for the city, said that the State Lands Commission would allow up to six live-aboards in the marina. The city has two years to reduce the number down to six.

“Speaking with the State Lands Commission, they informed us that the 12 live-aboards are not authorized,” he said. “They agreed to six.”

The city estimates it can make up to $30,000 in rent from these arrangements. Councilman Chris Albertson asked about conditions for those living on boats in the marina. St. John said that there are bathroom facilities for their use, and pump stations so that tenants do not dump waste into the river.

The Petaluma Marina and adjoining Sheraton Hotel and office complex, was built in 1990 as a highly visible landmark at the city’s southern gateway. Since then, the facility’s finances have been underwater, according to a 2016 Argus-Courier investigation.

The city has yet to pay off the original construction debt on the facility and unpaid interest pushed the total debt with the state to $6.18 million as of last year.

Recently, the lack of river dredging has made the marina even less attractive to boaters. The U.S. Army Corps of Engineers, which had maintained a regular dredging cycle on the river, has not serviced the waterway in more than a decade, leaving silt and sandbars that deter boaters not wanting to strand their pricey yachts.

Rep. Jared Huffman, D-San Rafael, has been working with neighboring jurisdictions on a plan to get local governments and industries to fund a regional dredging program.

(Contact Matt Brown at