Facing a nearly $8 million revenue shortfall next year, the Steamship Authority is making final adjustments in a set of fare hikes that will go into effect Jan. 1.

“Of that $8 million, $5.6 [million] is for fuel,” SSA treasurer/comptroller Mark Rozum said at Tuesday’s online meeting of the port council, an advisory group representing towns with boat line terminals.

The boat line has been able so far to avoid imposing fuel surcharges, which the Hy-Line and other passenger ferries applied to fares in 2022, because the SSA hedges its fuel costs by locking in prices a year ahead of time, Mr. Rozum said. But stiff price increases have pushed up the SSA’s anticipated 2023 fuel costs by 69 per cent, according to the draft 2023 budget.

Terminal operations and dry docking for ferry maintenance are among other expenses that will rise in 2023

Among lesser hikes, the boat line is increasing its advertising budget by 2.6 per cent in an effort to woo back foot passengers after a steep drop-off during the pandemic, when travelers felt safer in their cars.

“The advertising budget is for walk-on foot traffic,” Mr. Rozum said. “We still haven’t gotten back to pre-Covid levels yet.”

Walk-on fares are a significant part of the SSA’s bottom line, Mr. Rozum added.

The boat line board of governors is expected to vote later this month on the new fares, which are intended to raise $4.4 million on the Vineyard route and $3.4 million on the Nantucket route.

Standard automobile fares will bear the brunt of the proposed rate increases — $1,960,000 — with one-way crossings on the Vineyard route rising by up to $10 on peak summer weekends, according to the latest draft of the proposed changes. An earlier draft had capped that weekend increase at $5.

Vehicles over 20 feet in length will pay eight per cent more on the Vineyard route in 2023, raising another $1,040,000.

Parking in Woods Hole and Falmouth will go up by $50 for an annual pass and $1 a day for short-term use, raising $350,000.

Vineyard passenger fares will go up 50 cents a ticket, with 10-ride purchases rising by $4 and 46-ride purchases by $9, to produce $815,000 in revenue.

Excursion automobile fares on the Vineyard route will rise by $1 each way — equaling the increased ticket cost for two passengers included in the rate — for another $185,000.

The port council voted unanimously to recommend the draft budget and rate changes to the board of governors, which meets Oct. 18.

Also Tuesday, the port council heard from a New Bedford-based shipper on why his company did not pursue the boat line’s recent request for proposals (RFP) to pilot a freight service from an off-Cape port to the islands. Out of nearly 50 potential contractors who asked for the RFP details beginning in March, not one submitted a bid by the August 2 deadline.

“We gave it pretty thorough consideration,” said Jonah Mikutowicz of 41 North Offshore, who was at the meeting for an extension of his company’s summer barging service to Nantucket.

“The concerns that we saw with the RFP really boiled down to economic viability of it,” Mr. Mikutowicz told the council. “If there wasn’t sufficient traffic, we were still obligated to run. Quite frankly, the economics of that just don’t work.”

The RFP also specified passenger service, Mr. Mikutowicz said, which his company currently does not provide.

“That becomes an issue because a barge, in order to carry passengers, has to become an inspected vessel. You get into a whole different set of regulations with the Coast Guard, as the Steamship knows,” he said.

“So it was a combination of those factors that ultimately drove us away from it,” Mr. Mikutowicz said.

Asked by port council vice chairman Robert Munier if there was another structure he could envision for an economically viable off-Cape freight service to the islands, Mr. Mikutowicz offered little hope.

“I think the only real [possibility], without some sort of … economic support from unrelated third parties, would be an on-demand service, and I’m not certain that there’s the demand there to run an on-demand service, quite honestly,” he said.

Without a steady revenue stream, Mr. Mikutowicz said, fixed operating costs would make the service too expensive for shippers to choose over the Steamship Authority.

“It’s a longer transit from New Bedford, so their equipment is now tied up for longer,” he added.

“It’s possible that something over time could develop on an on-demand basis but I don’t see it being able to come in and immediately go from zero to a full service,” Mr. Mikutowicz said.

Documents from Tuesday’s port council meeting are posted at steamshipauthority.com/about/meeting_notices.