PSC Grants $1.10 per Ticket Fuel Surcharge for Ferries, Curtails Runs

The following schedule changes were approved by the PSC to be in effect July 6 until November 1:

• Cruz Bay to Charlotte Amalie — weekdays, 7:15 a.m. and 3:45 p.m.
• Charlotte Amalie to Cruz Bay — weekdays, 9 a.m. and 5:30 p.m.
• Cruz Bay to Charlotte Amalie — weekends, 11;15 a.m.
• Charlotte Amalie to Cruz Bay — weekends, 1 p.m.
• Cruz Bay to Red Hook — 5:30 a.m., 6:30 a.m., 7:30 a.m., 8 a.m. and every hour on the hour until midnight except 8 p.m and 10 p.m.
• Red Hook to Cruz Bay — 6 a.m. to 11 p.m., every hour on the hour except 7 p.m. and 9 p.m.

The V.I. Public Services Commission granted the two St. Thomas-St. John ferry operators half the relief the companies sought from soaring fuel costs and declining off-season ridership, raising ticket prices $1.10 and temporarily eliminating a handful of unprofitable runs between Cruz Bay and Red Hook and Cruz Bay and Charlotte Amalie.

The fuel surcharge will take effect as of July 6 and remain in effect until a rate investigation of the ferry service is completed in January 2009. The schedule changes will remain in effect until November 1. The baggage fee on the Charlotte Amalie-Cruz Bay ferry will increase to $2.50.

The PSC allowed the ferry companies to reduce the Charlotte Amalie-Cruz Bay service to two runs each way on weekdays and one trip each way on weekend days until November 1. The ferry operators will also suspend two evening runs between Red Hook and Cruz Bay

Ferry Fare Facts and Figures
Representatives of Varlack Ventures and Trans-portation Services of St. John brought facts, figures and alternatives to the PSC to back up their emergency request for schedule changes and a fuel surcharge on passenger tickets for relief from the pressures of fuel prices.

The ferry companies are losing $3,591 each day, Transportation Services comptroller Charlene Buchanan-Turnbull told the commission and staff at the Thursday, June 26, meeting at the PSC Barbel Plaza office  on St. Thomas.

“In order to break even we need a $4 surcharge,” Buchanan-Turnbull added. “We are millions of dollars in debt.”

Rate Review Complete by January 2009
The PSC  in early June delayed the ferry companies’ fuel surcharge and schedule change request while a full rate review was conducted of the St. Thomas-St. John ferry operations.

PSC legal counsel Tanisha Bailey-Roka outlined the schedule for the rate review for the ferry operators, which she projected would result in a January 2009 examiners report.

While some PSC members had complained the ferry companies were not providing the necessary financial information for the rate review or a PSC decision the surcharge request, one member acknowledged the impact of rising fuel prices could not be ignored.

“I just wondered how long you were going to be able to keep your head above water,” PSC member M. Thomas Jackson of St. Croix told the ferry operators. “It makes no sense to be running empty boats.”

Crunching Financial Information
When it came down to crunching the financial information the ferry companies provided to back up their emergency fuel surcharge and schedule change requests, the ferry operators had answers.

PSC member and former V.I. Senator Donald “Ducks” Cole asked the ferry operators how reducing downtown runs would affect fuel consumption.

“If you cut out the downtown, if you’re losing $4,000 per day, you might be losing $1,000,” Coles asked.

Cutting downtown runs would save the companies about $1,300 per day in fuel, according to Transportation Services’ comptroller

Buchanan-Turnbull. The ferry operators are hoping the rate hearings will result in new rate which will allow the companies a small profit and provide for the purchase of new equipment. she added.

“There has to be a coming together where we have a formula that works,” the ferry company representative said.

“Catching Up From Behind”
“We’re catching up from behind, now,” Buchanan-Turnbull said. “We’ve dug ourselves a hole now.”

A $2 fuel surcharge would generate $649,000 between July and December, according to the ferry company representative.

“That still leaves a shortfall of $686,679, $1,800 per day,” Buchanan-Turnbull added.

After the Transportation Services accountant explained how the government subsidies of the ferry companies have been late or insufficient, Cole defended the PSC’s role.

“Public transportation needs to be heavily subsidized so the fare to passengers would be low,” Cole said. “You’re asking the PSC to subsidize you.”

After about two hours of testimony, Coles  made the motions for the surcharge and schedule changes.

The fuel surcharge of $1.10 was reached through a formula by PSC consultant Richard Moore which considered the percentage of revenues that go towards fuel, the number of riders and the average ticket prices, according to Coles.