The decision came after Rumson officials approached the regatta's organizing committee and offered to host the race and contribute $250,000 toward the costs of staging the event, which can cost up to $500,000 a year.
The regatta - the nation's largest - began suffering financially after corporate sponsorship and competition revenue dropped by more than 60 percent as costs for staging the 2009 race increased.
"Various factors, primarily economic in nature, prompted the decision to relocate to the Navesink for the 2010, two-day competition," according to a draft of a Dad Vail news release obtained by the Daily News.
"Rumson, New Jersey, representatives approached us after learning that we have a need to restore financial reserves and made a very compelling proposal to host the event in 2010," Dad Vail President Jim Hanna said in the release. "Their support will preclude the need for large increases in registration fees to participating crews while continuing to benefit the Philadelphia community rowing programs."
Race organizers made the decision before they met with Philadelphia city officials Friday, but delayed the announcement, said a source familiar with the move.
"We're obviously disappointed that the event won't be held in Philadelphia next year," said mayoral spokesman Luke Butler. "And furthermore we're disappointed that the decision was made before the organizers met with the city. . . . We'll continue to work with them in the hope of bringing it back to Philadelphia where it belongs."
The regatta's headquarters will remain in Philadelphia. The regatta will continue to fund Philadelphia's minority rowing program.
"We're only talking in terms of 2010, we haven't gone beyond that," Ekdahl said. "But the expectation is that if we bring the sponsorship required and do a good job of hosting the race, they would consider us again in 2011."
Rumson became interested in hosting the race because of its potential economic benefits and as a way to boost the profile of the sport. Bringing the sport to Rumson "gives us and the sport instant credibility in the Two River area," Ekdahl said. The town started a high school crew program three years ago.
Staff writer Catherine Lucey contributed to this report.