SSA Studies New Deals for New Bedford Ferries
By JULIA WELLS
Steamship Authority treasurer and acting general manager Wayne Lamson said yesterday that a freshly minted plan for a high-speed ferry project laid out last week by the city of New Bedford is now just one of three new proposals.
"We got a proposal last Thursday night, there was the one that New Bedford showed everybody on Saturday, and we got another one just last night," Mr. Lamson said from his office in Woods Hole.
All three proposals are from the Nichols Brothers Boat Builders Inc., a shipyard in Washington state. All of the proposals involve a single ferry - a 500-passenger, high-speed ferry built by the shipyard in 1999 for $8.5 million. The ferry is for sale, although Mr. Lamson said yesterday he does not know why.
Three weeks ago the boat line governing board voted 2-1 to reject a high-speed ferry project that would have cost the SSA $10.6 million for lease and purchase of the vessel during the next three years. At the time the proposal was described as the best deal - and the only deal - available.
Mr. Lamson said all that has changed suddenly.
"I don't know if somebody put a bug in someone else's ear, but here we are," he said.
The project that was rejected last month was intended to replace the passenger ferry Schamonchi.
The SSA never put out a request for proposals (RFP) for the ferry project.
The original proposal called for the SSA to lease the same high-speed ferry from Boston Harbor Cruises. Boston Harbor Cruises had planned to buy the ferry from the Nichols shipyard, transport it to the East Coast and lease it to the SSA for $1.2 million a year for a minimum of three years. At the end of the three years the SSA would have had the option to buy the ferry for $7 million.
After the vote to reject the proposal last month, Mr. Lamson said SSA managers contacted Boston Harbor Cruises to tell them the deal was dead.
Then he said last week the SSA suddenly got a new offer to lease the ferry, only this time the offer came directly from the shipyard.
Mr. Lamson said the offer came in last Thursday night. He said senior managers had just started to look at the offer on Friday when New Bedford city solicitor George Leontire called. "He asked if I had a problem with him calling Nichols Brothers to tell them they need to work with the Authority," Mr. Lamson said.
He said he did not know how the city solicitor knew that the shipyard had made an offer to the SSA.
"I told George I didn't have a problem with that because we were getting ready to talk to Nichols anyway about their offer," Mr. Lamson said.
At a meeting with a group of Vineyard officials on Saturday, Mr. Leontire unveiled a lease-buy proposal for the high-speed ferry that he had negotiated with the Nichols shipyard.
Mr. Lamson said Mr. Leontire's proposal was sent to the boat line late on Friday. He said the shipyard sent a third proposal to the boat line on Wednesday night this week.
The three new proposals are all variations on the same theme: a lease-buy arrangement for the high-speed ferry. One proposal calls for the SSA to lease the ferry for two years with an option to buy at the end of the lease; another proposal (the New Bedford plan) calls for the boat line to lease the ferry for six months a year for two years with an option to buy at the end of lease; the third proposal also calls for the SSA to lease the ferry for two years with an option to buy at the end of a year. Each proposal has a different set of strings attached to it.
Mr. Lamson was still working on a financial analysis of the proposals yesterday, but he said all three proposals add up to about the same amount of money and would cost the public boat line about $1 million a year compared with the $1.2 million annual cost attached to the proposal that was turned down last month. The option to buy calls for the SSA to pay about $7.5 million for the ferry, Mr. Lamson said.
Mr. Lamson said the central problems that he laid out in connection with the original proposal remain the same:
* The boat line does not have $7.5 million to buy a ferry, and any capital expenditure in the next three years will collide with other planned capital projects, including a plan to replace the ferry Islander and a plan to renovate the Oak Bluffs terminal complex.
* No market study has been done, so passenger projections for the fast ferry service are largely fictional.
"There are a lot of factors that go into this. We don't know any more about the ridership than we did before, and then there is the timing of the replacement of the Islander and the renovation in Oak Bluffs. The board needs to look at the exit strategy: If this does prove successful and we want to buy the boat, where is the money going to come from to do it?" Mr. Lamson said.
He added: "So the board will have to decide: Is $200,000 a year enough of a difference for one of the members who voted against the other proposal to reconsider?"
At their meeting this week, the Falmouth selectmen voted to send a letter to Mr. Lamson asking him to prepare a management summary on the new high-speed ferry proposal in time for their Monday meeting next week.
He said he expects to bring at least one of the new proposals to the SSA board at the November monthly meeting.
He stopped short of commenting on whether the high-speed ferry proposal is a prudent business decision for the public boat line.
"Last month the board made a decision after weighing all the issues - whether it is prudent, that is their job to decide," he said.