Expect ferry fares to rise at more than three times the rate of inflation over the next four years if the Provincial Government doesn’t increase its funding for BC Ferries’ services to ferry-dependent communities.

At the end of March, the B.C. Ferry Commission set preliminary price caps for the period April 1, 2008 – March 31, 2012, which is Performance Term Two (PT2) of the Coastal Ferry Services Contract between BC Ferries and the Province.

Price caps provide a ceiling for the increase in fares which BC Ferries is allowed to charge its customers. The caps are set for a group of routes, which means that the average of increases must be less than the caps. Conceivably, a particular route could have a higher increase.

Under the Commission’s March 30 ruling, on April 1, 2008 fares could increase by 5.4% on the three major routes between Vancouver and Vancouver Island and 3.6% on all other routes.

These figures assume the same level of service and Provincial funding BC Ferries has had since 2003. The Province now has until June 30 to decide on any changes. The Commission will determine the final price caps by September 30.

Under the existing contract for PT1, the minor routes already have another 4.4% increase scheduled for November 1 this year.

The Commission’s preliminary ruling states:
“The starting point for these increases is the fare level, including fuel surcharges, that will be in effect a year from now, i.e. March 31, 2008. In other words, the current fuel surcharges will be folded into the fare base.
“Annual fare cap increases for April 1, 2009, 2010 and 2011 are linked to general inflation: if inflation were 2% through 2011, fares could then increase each year by 3% on the major routes and 6.7% on the other routes.” The Consumer Price Index (CPI) for Vancouver has averaged 2% per year since 2001. If CPI exceeds 2%, the price caps would be adjusted upwards.

The Commission also created a mechanism to allow BC Ferries to institute additional fuel surcharges if the price of oil goes a certain amount above the new benchmark built into PT2. Details are available at www.bcferrycommission.com.

The government’s policy, written into the Coastal Ferry Act, requires movement toward user pay and reduction of support from Provincial funds. The strategy has been incremental increases, which the Minister of Transportation is fond of dismissing as “only a buck or two.”

Since the new system was put in place in 2003, the ticket book price for a vehicle, driver and one passenger has risen from $10.65 to $19.65 for a roundtrip between Campbell River and Quadra and from $26.17 to $45.10 for a roundtrip between Campbell River and Cortes.

If the preliminary price caps become reality, the same roundtrips in April 2011 could cost $25.81 to Quadra and $59.25 to Cortes, assuming 2% inflation and no further fuel surcharges.

The cash fares will also be higher than they are now, but it is a fact that BC Ferries has been increasing the ticket book prices at a greater rate than the cash fares while staying within the prices caps for PT1.

Representatives of the coast’s Ferry Advisory Committees are planning to meet with Ferry Commissioner Martin Crilly in Nanaimo next week to clarify elements of his ruling before meeting with Ministry of Transportation officials at the end of April in an effort to get the government to keep the fare hikes within CPI by providing an increase in the service fee for PT2.

In mid-March, the government announced it would give BC Ferries $5 million to eliminate the fuel deferral account for the Northern routes. We will be asking why our fuel surcharges don’t deserve the same treatment instead of being rolled into the new fare structure.

New Quadra/Cortes Vessels

In the last issue, a letter from former FAC chair Michael Stahnke mentioned ferry issues in relation to Quadra Island’s work on its Official Community Plan. Cortes is also about to launch an OCP review through the Regional District. The amount and cost of ferry service is obviously an important consideration.
Having seen the dates and plans for new vessels change like the weather, I don’t think we can reliably say when our routes will have a new ships until BC Ferries has tendered contracts to build them. It is true that BC Ferries intends to replace all of the vessels on the minor routes in the next 15 years.

By John Sprungman, Chair, Ferry Advisory Committee (reproduced on the gumboot under agreement with the Discovery Islander)