Operating Losses Persist at Steamship Authority; Possible Fare Hikes Loom
By James Kinsella
Gazette Senior Writer
Continuing operating losses at the Steamship Authority have raised the specter of possible fare increases later this year, boat line governors learned yesterday.
At the monthly boat line meeting, held in the Katharine Cornell Theatre in Vineyard Haven, SSA treasurer Robert Davis said the boat line had lost $9.5 million through the month of May, $1.25 million worse than expected.
Through April, passenger traffic on the boat line is off 5.3 per cent to 464,647, with automobiles off 5 per cent to 102,005 and parked cars off 14.3 per cent to 18,519. Trucks are up 11.5 per cent to 41,442, possibly reflecting larger passenger vehicles being counted as trucks.
Mr. Davis said revenue is about 6 per cent lower than expected. If the trend continues, he said, the boat line's estimated revenue of $68 million this year will be reduced by $3.5 to $4 million.
General manager Wayne Lamson said about $2 million is available in a boat line reserve fund to help cover a shortfall. Mr. Lamson said the SSA can also take other steps to improve efficiency and increase revenue, such as adding more ferry trips, to absorb any additional shortfall.
He said revenue shortfall in the off-season can be made up by higher traffic volume during the summer season.
But SSA chairman Marc Hanover said the boat line may need to turn to rate increases to close the gap. He said he hopes such increases will not be necessary, but he would not rule it out.
Mr. Lamson said he plans to review boat line finances next month with the SSA board before recommending any specific steps for the final half of the year. "We're going to be watching the cash flows very carefully," he said.
The board of governors plan to review a preliminary budget for 2006 in September, and pass a final budget in October.
Adding to boat line losses so far this year is a non-recurring loss of about $400,000 on the Schamonchi, a conventional passenger-only ferry. At yesterday's meeting, Mr. Lamson announced that the boat line is selling the vessel for $105,000 to Caribbean Shipping and Marine Services of Flushing, N.Y. The SSA acquired the vessel four years ago as part of a $1.75 million package that included its route from New Bedford to the Vineyard.
But Mr. Lamson said boat line passenger totals also have been falling for three straight years.
Asked later in the meeting what can be done to reverse the trend, boat line board members and managers had no specific ideas.
Mr. Hanover did express concern about the traffic that competing private ferries are carrying to and from the Islands. While a number of the licensed carriers pay fees to the SSA based on their passenger volume, Mr. Hanover said the boat line generally has to make up revenue that is siphoned off by competing carriers.
In other business yesterday, SSA officials confirmed that they are scheduled to meet informally at 5 p.m. Tuesday with the Oak Bluffs conservation commission on the North Bluff. Boat line managers will discuss the boat line's proposed reconstruction of the Oak Bluffs terminal.
Following a site visit at the bluff, boat line representatives and the commission will adjourn to town hall on School street to continue the discussion.
Town residents and officials have expressed concerns about possible environmental and traffic impacts of the planned $10 million terminal reconstruction. But the boat line's director of engineering, Carl Walker, said the SSA will stand by its basic plan.
The conservation commission, with the help of Bourne Consulting Engineering, and other state and Vineyard entities have raised a lengthy series of questions about the plan.
On June 7, a boat line consultant, Maguire Group Inc., completed written responses to the questions.
The conservation commission, through Bourne Consulting, stated that the boat line had proposed work in an area north of the terminal which is designated as a coastal bluff under the state Wetlands Protection Act and the town wetlands protection bylaw. The commission said the work was inconsistent with both the state law and the town bylaw.
The Maguire Group claims that the proposed work meets the guidelines of both laws. At issue is whether the North Bluff area meets the definition of a coastal bank, which is significant to storm damage prevention and flood control.
Bourne Consulting also points to the section of the town bylaw which states: "There shall be no net loss of wetland or wetland resource areas in Oak Bluffs."
The Maguire Group claims that any impacts can be addressed through what is known as mitigation and replication.
The current plan hinges on moving the terminal building across Sea View avenue into the old town hall and demolishing the town comfort station now to the north of the terminal building.
An enlarged dropoff and pickup area would be created on Sea View avenue south of Oak Bluffs avenue, with an enlarged staging area on Sea View north of Oak Bluffs avenue.
More space would be created on the existing pier for vehicles by shifting the pedestrian walkway farther south along the pier's southern edge. The pedestrian ramp to the vessel would be lengthened, allowing vessels to use two doors to load or off-load passengers. A walkway and native plants will be placed along the bank above the riprap just north of the existing pier.