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Community braces for reduction in ferry service

Public consultation key to ensuring changes keep transportation corridors viable
Laura Walz

 UPDATED May 16, 2012:  While BC’s government has allocated $80 million in additional funds for BC Ferries, reduced service will unfold on underutilized routes.

Blair Lekstrom, minister of transportation and infrastructure, introduced amendments to the Coastal Ferry Act in the legislature on May 9, changes that reflect the government’s response to a report by the BC Ferry Commissioner.

The government will be initiating a public engagement process in the near future with coastal communities. “We are going to look for $30 million in service adjustments and trade-offs as to what can be done out there to make sure that we don’t have routes that are running at below 30 per cent utilization,” Lekstrom said during a teleconference call.

Other provisions in the legislation include permitting cross-subsidization between routes and giving the ferry commissioner more flexibility and power to oversee the company’s costs and responsibility for approving major capital expenditures.

According to statistics from BC Ferries, two routes servicing Powell River fall under 30 per cent utilization.

For the year ended March 31, 2011, capacity utilization on the Powell River-Texada Island route was 26.3 per cent.

Capacity utilization on the Saltery Bay-Earls Cove route was 27.5 per cent.

On the Powell River-Comox route, capacity utilization was 34.3 per cent.

Route 26, Skidegate-Alliford Bay, had the lowest capacity utilization at 21.3 per cent.

Some of the amendments to the Coastal Ferry Act are welcome, said MLA Nicholas Simons, who represents Powell River-Sunshine Coast, such as the end of “user pay” and the return of cross-subsidization. “For this bill to be successful, it needed something to address fares,” he said. “The commissioner said fares were at a ‘tipping point’ and has repeatedly said they shouldn’t increase faster than inflation, but we’ll see our fares increase at twice that rate.”

Now government is threatening to reduce services, closing down access to our communities, Simons added. “In fact, the government has given the commissioner the ability to permanently cut services unilaterally with minimal consultation. The minister talks about cutting sailings that have low usage rates. Will they shut the Port Mann or the Sea to Sky highway when they’re not running at capacity?”

City of Powell River Mayor Dave Formosa called Lekstrom’s announcement “non-substantial.” While the government is providing funding to keep fares down, it is also saying that for routes that are not used significantly, “get ready for a pounding,” Formosa said.

The community needs to make sure transportation corridors are kept viable and sustainable, Formosa added. “They’re talking about change, so we need to be there and negotiate the change with them, otherwise they’re just going to impose upon us their will. I don’t think we’re going to let that happen.”

Bill Cripps, chair of the Northern Sunshine Coast Ferry Advisory Committee, said the increase to the service fee was positive and a reduction in service levels was not a surprise. “What’s really missing is how the process is going to work,” he said. “That’s what we’re all waiting for, to understand how the process will come together and how the public consultation will take place.”

The number of round trips per year for all routes servicing small coastal communities are identified in the coastal ferry services contract, Cripps said, and they date back before privatization of BC Ferries in 2003. “These service models have been in place for a long, long time and people have made lots of personal decisions, business decisions, in terms of the delivery of that service model,” he said. “Changing that is going to be very challenging. It’s not going to be a simple matter.”

Councillor Chris McNaughton, who holds the ferries portfolio, said the province’s decision to lift the prohibition against cross-subsidization between route groups is a positive step toward providing some financial relief on the routes servicing Powell River.

“It is disappointing the province did not limit the fare increases to the rate of inflation,” he said. “However, the government’s contribution of $79.5 million in additional funding is expected to hold fare increases below 4.15 per cent.”

Scott Randolph, Powell River Regional Economic Development Society manager, said he didn’t think the money the government is injecting will alleviate fares and the big issue is service levels. “There are some real concerns about what service levels are going to look like in the future,” he said. “I think it will play into the vessel-replacement strategy as well. I think now more than ever we need to have that consultation with the government.”


Changes to ferry legislation paves the way for service reductions

Government contributes more to service fee

BC’s government introduced changes to the Coastal Ferry Act, Wednesday, May 9, that increase the service fee, but pave the way for “significant adjustments to service levels.”

The additional provincial funding of almost $80 million is spread out over five fiscal years, with $46.5 million upfront, followed by $10.5 million next year, $11 million the following year and $11.5 million in 2015-2016.

Blair Lekstrom, minister of transportation and infrastructure, said during a conference call that the changes will take the involvement of the province, BC Ferries and ferry users. “This is really about the taxpayer, it is about the ferry user and it is about the ferry corporation,” he said. “All of us have to come together to ensure that we have a long-term, financially stable and affordable system.”

BC Ferries has to find an additional $15 million in efficiencies, Lekstrom said, while it maintains its safety record.

There will be significant adjustments to service levels, and discussions with communities about trade-offs among service adjustments, fare increases and potential community contributions.

The government will be initiating a public engagement process in the near future with coastal communities. “We are going to look for $30 million in service adjustments and trade-offs as to what can be done out there to make sure that we don’t have routes that are running at below 30 per cent utilization,” Lekstrom said.

He doesn’t want to give the impression that there isn’t going to be pain from the community side of things, Lekstrom added. “We are asking the people to come to the table, to talk to us, talk about trade-offs,” he said. “There may be opportunities that they have that they want to put forward.”

The new legislation is the government’s response to a report by BC’s independent ferry commissioner. Other provisions in the legislation include:

• Cross-subsidization between routes will be permitted.

• The commissioner will be given additional responsibility to oversee the costs of providing the ferry service. These changes will help reduce the pressure on fares.

• The commissioner will be responsible for approving major capital expenditures with a view to furthering government’s long-term vision. For example, the commissioner will be able to consider vessel replacements that will meet the needs of the future rather than the traffic patterns of the past.

The government will also be exploring a long-range vision for BC Ferries and long-term strategies will be developed and implemented. Future investments will look at providing greater interoperability of ferries between routes, reducing operating costs by implementing new technologies, such as liquid natural gas-fuelled and cable ferries, and allowing for alternative methods to connect coastal communities, such as passenger-only ferries and other service improvements.