Following a 77 per cent deterioration in its bottom line last year, and continuing declines in traffic, the Steamship Authority has again reduced services to Martha’s Vineyard.
Tuesday’s meeting of the SSA’s board of governors voted to reduce the number of daily round trips for the freight vessel Katama from a maximum of seven to four during the spring period from April 4 to May 18, to account for a decline in the number of vehicles, particularly trucks, coming here.
The management recommendation they approved cited deteriorating economic conditions since the board approved the operating schedule just last August.
The number of large trucks (20 feet and over) carried between Woods Hole and the Island was down an average of 8.3 per cent over the seven months from August, compared with the same period a year earlier. The declines for January and February this year were 12.1 per cent and 13.3 per cent respectively.
If necessary, general manager Wayne Lamson told the board, extra trips could be added if needed, particularly during the April school vacation.
Along with cuts to the freight services to Nantucket, the measure is expected to save the boat line some $230,000.
And savings are important right now. As Mr. Lamson said at the meeting, providing services and making budget cuts this year would be a delicate balancing act.
The operating results for 2008, presented by the SSA’s treasurer/comptroller, Robert Davis, gave further indication of how delicate. Net income for the year was just under $1.5 million, more than $5.2 million (77.7 per cent) down on 2007, and more than 60 per cent below that projected in the 2008 budget.
But for rate increases implemented at the beginning of last year and the sudden sharp decline in fuel prices in the latter months of the year, the boat line might well have gone deep into the red.
Asked by Nantucket board member Flint Ranney if the huge decline in net income “scared” him, Mr. Davis said: “I was a little concerned there at the end.”
And while a couple of the factors which made 2008 hard — high fuel prices and some major, unexpected maintenance costs — were past, the number of vehicles and passengers continues to decline, along with revenue.
January saw a sharp fall in all traffic categories: 12.1 per cent for large trucks, 5.4 per cent for small trucks, 6 per cent for cars and 5.1 per cent for passengers.
A positive for the boat line, if not for Island residents dependant on that commerce, was that operating expenses fell even more sharply; they were down 15 per cent.
But Mr. Lamson acknowledged the possibility of further revenue declines ahead, given the current weak economy, and said the SSA would have to continue to be “proactive” in cutting costs and finding new ways to attract patronage, such as special promotions like free parking or bicycle passage and discounts at certain times of year or days of the week.
There was some good news, however. Director of engineering Carl Walker reported the Oak Bluffs terminal reconstruction was proceeding on schedule. And a relatively small contract to do some repairs at the Woods Hole terminal had attracted seven bidders, all of which came in below the SSA’s project cost estimate of $125,000. The lowest was just $46,5000.
So there is an upside to a down economy.
The SSA also is moving to improve internet service aboard its boats. Currently, limited bandwidth severely limits the number of passengers who can simultaneously access some sites.