CHICAGO — The U.S. Coast Guard’s nationwide crackdown on private boat rentals could spell trouble for a new boat sharing service opening for business in Chicago soon.
Following the news of Catered Cruises’ launch this month, the Coast Guard’s Marine Safety Unit in Chicago has raised concerns about the service’s compliance with federal regulations.
Catered Cruises has since updated its website to reflect its compliance with city, state and federal maritime rules. The Coast Guard has not yet reviewed the updated website to determine the company's compliance, according to Simone Mausz, senior investigating officer at the Marine Safety Unit.
Catered Cruises, a boat sharing service which allows boat owners to rent out their boats to passengers for brief cruises, is set to begin accepting reservations April 20. The service aims to give boat owners an alternative revenue source for their vessels.
Mausz says the Coast Guard has seen a rise in private boat owners operating their vessels for hire without obtaining proper credentials.
It is important that maritime rules and boating specifications are followed in order to ensure that, for example, personnel on-board are trained for "man overboard" situations, the vessels have the proper lifesaving equipment, the driver of the boat knows not overload it with too many passengers, Mausz and Byron Rios, lieutenant with Coast Guard, said.
Though other platforms like Boatbound and Boatsetter also facilitate boat-sharing services, Mausz did not name any other, similar startups besides Catered Cruises that could be at risk of violating the regulations.
Michael Lambiase, a Chicago-based boat owner who rents his boat out on Boatbound, said the platform has helped him earn enough money to buy a second boat, adding that his boat is often used for events like wedding proposals, tailgating and concerts.
Lambiase, who is working on becoming a captain himself, said his experience has been mostly positive with the company, adding that at times he sifts through 10 to 12 requests at a time for renting his boat. Before listing his boat on Boatbound, Lambiase said he had to go through the required safety inspections as well as the company's inspections.
He said he recognizes the dangers associated with operating a boat, especially given that many owners are not captains themselves. He often has a friend who is a licensed captain accompany him while out on the water.
"It would be nice to see more people out there with more knowledge. It's scary," Lambiase said. "The people that are out there are like 'Oh, I can drive a car. Excellent!' But there's no brakes on a boat."
Mausz said there are licensing rules for captains and caps on the number of passengers on a given vessel. For example, if a boat carries six passengers and the captain has a six-pack license, that is legal, but any more passengers would be against Coast Guard regulations.
She said the agency notified Catered Cruises via mail that there proposed operation was not in line with Coast Guard regulations but has not yet received a reply from the company.
“On [Catered Cruises’ previous] website, they’re saying they can take up to 10 passengers, so that would be outside the regulations,” Mausz said. “Once you’re providing a crew on a vessel that’s carrying 10 passengers — anything over six once you provide a crew — has to be certificated.”
The company confirmed that it has recently received the letter from the Coast Guard, and said it will follow up with the Coast Guard this week. The company maintains that it is going to comply with all maritime regulations.
For the cruises of six people or fewer, the owner of the boat will be on the boat only if he or she is a licensed captain. If the owner is not a licensed captain, then Catered Cruises will help match them with a licensed captain and they cannot be on the boat, founder Chris Brown said.
For cruises with more passengers than six passengers, charters will be done by existing charter services as a referral by Catered Cruises, said the company’s senior vice president Gentre Vartan.
The website for Catered Cruises was redone and updated last week to reflect that it is in compliance with federal regulations.
Catered Cruises' charters will be operated by a certified captain and an approved charter boat, meaning these boats will have a sticker on it from Westrec Marina, which manages Chicago’s harbors on behalf of the Chicago Park District, authorizing it to be a charter boat, Vartan said. The boats will also have the Illinois Department of Natural Resources sticker on them, which requires inspection by the Coast Guard to receive, he said.
“There are a number of illegal charters that occur out on Lake Michigan, and it is a daunting task for the Coast Guard to stop and then subsequently prosecute those charters,” Vartan said. “But Catered Cruises is the good guys. We’re the ones that are going to be in conformance on every charter.”
The Coast Guard’s inspection entails checking a myriad of details including the boat’s engine, piping, tubing and generators as well as the vessel’s lifesaving materials and overall stability, Rios said. The typical inspection alone could take three hours or so, depending on the size of the vessel, he said.
“There’s a long list like a fine tooth comb administratively: [such as] firefighting, lifesaving, stability, watertight, integrity,” Rios said. “A lot of people think that it’s easier to drive a boat than it is to drive a car. And that’s not true. It’s a totally different entity.”
Each of the Catered Cruises vessels will also be insured, Vartan said. Though the owner is responsible for ensuring his or her vessels is of charter status, Catered Cruises will also review the documentation prior to listing the boats, he said, adding that the company will check to see that it has all the proper lifesaving materials.
Given that unauthorized private boat rentals have become a nationwide problem, the Coast Guard will be putting out an information release so that individuals will be more aware of the regulations, Mausz said, though the regulations are based on the Passenger Vessel Safety Act of 1993. Fines can reach as high as $15,000 per day that the vessel operates outside of regulation and the master operating the vessel could lose his or her licensing for good, she added.
Mausz urges patrons of private boat rentals to inquire about the master’s credentials before boarding, because they could be called upon as witnesses in a hearing if the master is caught without the proper credentials.
“I think the bottom line is it comes down to safety. We want people to be safe out on the water,” Mausz said.
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