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Catalina's Ship Hasn't Come In : Commerce: Worried island merchants blame poor economy, gambling restrictions on ocean vessels and unseasonal weather for sharp declines in business.


The boat doesn't stop at Santa Catalina Island as often as it used to, and merchants are getting nervous.

It's been seven months since the Viking Serenade canceled one of its two weekly stops at Avalon Harbor, reducing the number of passengers who come ashore to meander through the quaint streets and memento-filled shops.

That cutback, along with bad weather and the poor economy, is being felt keenly by Catalina merchants who are calling this one of their slowest summers in years.

"It's as bad as I've seen it. For this late in the summer, we should be much, much busier than we are," said Wayne Griffin, executive director of the Catalina Island Chamber of Commerce and Visitors Bureau.

"If you did biorhythms, it would be sort of like hitting a triple low," said Chuck Prince, city manager of Avalon, which is the only city on this picture-postcard isle of steep hills, sheltered coves and Mediterranean-style homes 26 miles off the coast.

Merchants first felt the pinch several years ago when the Southern California economy soured, prompting budget-conscious consumers to forgo vacations.

Then came the second blow: a state law that went into effect in January banning gambling on any ship sailing from one California port to another. The ban led to the Viking Serenade's cancellation of its Saturday stops off Avalon, and the elimination of gambling from its Tuesday cruises, which still stop at the harbor.

As if the economy and gambling restrictions weren't enough, a series of overcast days that merchants have dubbed "June gloom in July" has discouraged mainland tourists from catching the ferry to Catalina.

The Catalina Island Chamber of Commerce reports that as of June 30, 316,159 people had visited the island this year, representing an 11.5% decrease from the same period in 1992.

Officials are blaming much of that decrease on the reduced visits by the Viking Serenade, operated by the Royal Caribbean Cruise Lines. The Southward, a second but smaller cruise ship operated by Norwegian Cruise Lines, is still paying two weekly trips to Catalina.

Norbert Reyes, who runs two gift shops on the Avalon waterfront, reports that business is down 20% from last year.

"I'm worried day in and day out--am I going to meet my bills on time?" Reyes said.

To illustrate his point, Reyes nodded toward the half-empty beach a few paces from his shop. Last year, people would show up at the beach at 6:30 a.m. to reserve space with their beach towels, he recalled. This year, the crowd is thinner.

City Councilman Ralph J. Morrow Jr. calls this year's economy the worst he has seen in his 21 years in business on the island. Sales at his Catalina Island Department Store had already plummeted 40% between 1989 and 1992, and this year is bringing no relief, Morrow said.

Since the average purchase had dropped from $30 to about $20, Morrow is stocking less expensive items--replacing Nikes, for instance, with lower-priced shoes.

"The visitors who are coming don't have the discretionary capital that they used to have," Morrow said.

Some merchants suspect that the island is seeing more day-trip visitors and fewer overnight guests, as consumers try to avoid paying hotel bills.

"Obviously, people are not spending the money," said Fred Morse, co-owner of Avalon's seven-room Seacrest Inn, where more rooms are empty during the week than they were a year ago. In response, Morse has reduced room rates by 20% between Sunday and Thursday in hopes of attracting more visitors.

The decrease in island visitors has also meant a drop in revenue for the city, which has been collecting new fees from visitors in an attempt to keep the doors open at its 12-bed municipal hospital.

The city has imposed a $1.50 fee on each cruise-ship passenger and raised the fee on ferry passengers from $1.50 to $2. Most of that money was earmarked for the hospital. The city is anticipating it will receive about 17% less than the $580,000 annually it expected to receive from the fees when they were imposed last year.

Merchants keep hoping that recession-buffeted Southern Californians will start thinking of Catalina as a more economical alternative to Hawaii or Mexico.

Yet for all the gloom, meteorological and economical, the drop in visitors can make the island even more enticing.

As the Chamber of Commerce's Griffin sums it up: "There's still a perception, 'Don't go to Catalina in the summertime because it's so doggone crowded, you just can't do anything.' And that's just not the case."

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