Two years ago, the company tasked with running the Queen Mary collapsed, leaving Long Beach, which owns the ship, facing a monumental question: What to do with the historic vessel, which needed hundreds of millions of dollars worth of repairs?

One option the City Council voted to explore at the time was to transfer the ship to the control of Port of Long Beach. But officials announced Tuesday that the proposed transfer is off the table—at least for now.

After over half a century of failed operators, the city will remain in control of the landmark.

“In the end,” a City Council staff report for next week’s meeting reads, “the city’s experience with hotel, restaurant, parking, and passenger terminal leases and expertise related to special events and filming activity pointed to the city as the best steward for the Queen Mary and Pier H for the foreseeable future.”

The news comes after a Monday afternoon press conference in which city and port officials announced a proposed partnership to infuse $12 million into the declining ship through a land swap.

Mayor Rex Richardson said in a Tuesday tweet that the plan “brings closure to the question of whether or not the Queen Mary will be transferred to the Port of Long Beach. The ship will remain with the City of Long Beach. The Port will be a partner.”

Richardson lauded the proposed land swap, which is slated to be voted on by the City Council next week, saying the partnership will fund repairs and restoration projects as well as strengthen the city’s economy.

City Manager Tom Modica told the Post that the city is open to restarting communications with the port about transferring the ship in the future, but added that he is enthusiastic about the prospect of the city overseeing and investing in the Queen.

Port officials also see the plan as beneficial.

“The port welcomes the city’s proposal to continue to manage the Queen Mary,” Deputy Executive Director Noel Hacegaba said Tuesday night. “As always, we stand ready to work together with the city team on measures that benefit tourism, trade and transportation in Long Beach.”

The port, for its part, commissioned a study of the ship in June of last year to determine its potential fiscal obligations, should the ship be transferred. The report is expected to be completed in the next three to four months, spokesperson Lee Peterson said in an email Monday.

The initial idea of transferring the ship came after Urban Commons, the vessel’s previous leaseholder, went bankrupt in 2021.

The city was left holding the bag for the deteriorating ship, which likely needs hundreds of millions of dollars in repairs and deferred maintenance. So in September of that year, Councilmember Cindy Allen, whose district at the time included the ship, brought an item to the council to open negotiations between the city and the Harbor Department, which oversees the Port of Long Beach.

The item passed unanimously, with Modica stating negotiations could take up to a year.

The proposal was controversial, with Harbor Commissioners voicing their concerns over the effects the transfer could have on the port’s numerous crucial—and expensive—capital improvement projects.

“Not to be on the negative side of this, but I’m hoping that our City Council really understands that we have to be careful with what we get ourselves involved with and how do we financially make this work,” Harbor Commissioner and former City Councilmember Frank Colonna said at the time. “We can’t magically create new money to deal with what hasn’t been dealt with in the past.”

The plan also received pushback from port stakeholders, including the Pacific Merchant Shipping Association, and the California State Lands Commission, all of whom pointed to potential impacts the move could have on port operations due to the financial strain that would be brought on by footing the bill to repair and restore the ship.

John McLaurin, PMSA president, said Tuesday that the association is “pleased” the transfer is off the table. He did, however, note that there is still concern over an ongoing partnership between the city and port when it comes to the iconic ship.

“According to a (2016) marine survey, the ship needs $300 million to restore its structural integrity,” McLaurin told the Post in an email. “With cargo volumes dropping, port competitiveness intensifying and in order to meet the strictest environmental standards in the nation, the Port of Long Beach is not in a position to fund the many needs of the ill-fated Queen Mary.”

While repairs and restoration to bring the Queen back to its former glory are costly, so are any other options for handling the vessel, according to a 2021 report from engineering firm Moffatt & Nichol. The city-commissioned report examined various ways the city could deal with the ship—from fixing it up to scrapping it.

The findings of the report were plain: No matter what the city does, the price tag will be large. Dry docking the ship was the most expensive option, at $200-$500 million. Turning the ship into an artificial reef would run between $105-$190 million.

The cheapest option, which the city has opted for, is preserving the vessel with a one-time cost of $25-$50 million, with ongoing costs of $5 million annually for more than 25 years.

The staff report for next week’s City Council meeting states that, prior to the coronavirus pandemic, the Queen Mary generated upward of $57 million gross revenue annually, which the city hopes to generate once again for reinvestment into the ship.

“In the end,” the staff report states, “the (city and port) concluded the best option for the Queen Mary to support herself was through an investment in the ship … to give her every possible chance to generate revenue that would then be dedicated to the significant operational and maintenance costs to preserve the ship in the future.”

Proposed land swap between port, city would provide $12M for Queen Mary repairs

Brandon Richardson is a reporter and photojournalist for the Long Beach Post and Long Beach Business Journal.