NANTUCKET - The people of Nantucket clashed openly with the Steamship Authority yesterday, raising tough questions about boat line spending and demanding that the SSA abandon a new marketing venture that will allow J. Crew to hand out catalogues on ferries and in terminals during the popular Nantucket Christmas Stroll.

"This is public relations? This is akin to putting Hy-Line brochures on Steamship Authority ferries. This is one of a series of public relations triumphs," declared Finn Murphy, chairman of the Nantucket selectmen. Mr. Murphy and the leaders of virtually every business group on Nantucket, including the island chamber of commerce, lambasted the boat line for the J. Crew handout project.

About 100 Nantucket residents turned out for the monthly SSA meeting, held in the Nantucket Inn. Business leaders said they had not been told about the J. Crew plan for the Christmas stroll; they said it threatens to taint the annual holiday event, which attracts thousands of visitors during the first weekend in December.

Nantucket boat line governor Grace Grossman said she had not been told about the promotion.

"I didn't know about this, either. This is shooting the Nantucket business community. The Christmas stroll is for the Island to promote its own businesses," Mrs. Grossman said.

"This is a slap in the face to Nantucket merchants," declared an editorial in yesterday morning's Inquirer and Mirror, the newspaper of record on Nantucket.

The four-hour meeting was marked by a heavy business agenda, and among other things the board approved a $65 million operating budget, a $3.3 million rate increase and new operating schedules for the coming year. Vineyard travelers will see rate increases totaling $1.1 million, with most of it coming from increases on SUVs and other large vehicles.

The meeting was contentious and punctuated by bickering among the board members. At one point Vineyard SSA governor Kathryn A. Roessel sparred testily with Mr. Murphy.

"Don't you think you are overreacting a little bit?" she told the chairman of the selectmen, adding:

"Everybody in this room gets 19 J. Crew catalogues in their mailbox every week. It's not like we're introducing a virus, and quite frankly I don't know why we need to backpedal every time some special interests are affected."

Ms. Roessel's remarks drew a fresh blast from the Nantucket people.

"This is arrogant and offensive," said one.

"This is a disaster, an absolute disaster," said Mary Malavase, an innkeeper and a member of the chamber of commerce public relations committee.

"Please reverse the J. Crew plan. You are just slapping the face of the people who live here," she said.

Stiff rate increases for the coming year on the Nantucket route were a clear subtext, and a number of Nantucket residents had sharp questions about the upcoming operating budget.

"Where is the cost-cutting by management?" one asked.

The SSA is embarking on a new and untested marketing venture this year in an attempt to raise outside revenues. The plan calls for selling advertising space on ferries and in terminals and also for publishing a four-color glossy "in-float" magazine.

Tension between the boat line and business interests in the port communities has popped up in more than one place in recent months. On the Vineyard, the Oak Bluffs business community was up in arms over a plan to end the season early at the Oak Bluffs SSA terminal.

In Woods Hole, restaurant owners are miffed about a summer food concession stand that earns money for the boat line.

Both the Vineyard and Woods Hole were treated kindly yesterday - the schedule will stay the same in Oak Bluffs again next year, and the governors voted to make the hot dog stand a one-year contract with a provision for review.

But it was a strikingly different story for Nantucket, and a growing divide between that island and the rest of the boat line appeared to deepen with yesterday's events.

SSA public relations director Paula Peters is away from work this week and did not attend the meeting. SSA chief executive officer Fred C. Raskin defended the J. Crew promotion deal, even though when questioned by Nantucket residents, he admitted that he did not know any details.

"How much money are you going to make from this?" asked Chris Perry.

"I don't know," Mr. Raskin said.

Mr. Perry was incredulous. "You have absolutely no idea how much money you are going to make from this?" he said.

"I didn't ask," Mr. Raskin replied.

He said the boat line has a contract with Carroll Advertising Inc. in Boston and it is up to the advertising company to make the deals.

Ms. Roessel encouraged the disgruntled Nantucket business leaders to have a meeting with Ms. Peters and discuss the matter.

But Kate Hamilton Pardee, director of visitor services for Nantucket, said it is incumbent on the boat line to inform the Nantucket community about a new marketing plan.

"As a public relations director, it's your responsibility to do outreach to the communities. If you are going after a specific Nantucket weekend, why wouldn't you approach the Nantucket merchants about it?" she said.

"Nantucket feels it has been shortchanged by management, and we feel there is an arrogant attitude," said Flint Ranney, a member of the boat line port council.

Mr. Raskin disagreed.

"I hear the word arrogant, and I don't see the arrogance," he said.

"But we are also not unique. All transportation companies in the country are desperately looking for other revenues. We have assets that have never been utilized and they are walls and pavement and busses and we are going to start using them. We've got to start somewhere, we're going to step on some toes and we have done so here and my apologies. But we're not arrogant."

Mr. Ranney pressed his theme.

"I hope that you will take away from this meeting the perception is that arrogance is out there. I think you should clean up the boats before you put Budweiser signs on the Islander," he said.

The Nantucket people repeatedly urged the board to rescind the J. Crew plan.

"What we are saying as a community is we do not want to see this happen. So please vote to rescind it," said Tim Madden, who is the Nantucket legislative liaison.

"You don't understand the stakes here - this is the board's responsibility and I want to know right now whether there is going to be a motion," Mr. Murphy said.

Mrs. Grossman took the first step. "I have been asked by my own community to rescind this," she said. But no one seconded her motion.

Then Barnstable boat line governor Robert O'Brien moved to have management examine the contract and rescind it if feasible.

But three of the five members - Ms. Roessel, New Bedford governor David Oliveira and Falmouth governor Robert Marshall - killed the motion by voting against it.

Finally, Mr. Oliveira moved to have management examine the contract for cost effectiveness.

The same three members voted to approve the motion.

Mrs. Grossman shook her head. "So you are not going to listen to the Nantucket people," she said.