Freight Service Outlook Dims

Steamship Authority Awaits Word from New Bedford on Summer Freight
Service to Island; New Deadline Is Set

By JULIA WELLS

The dubious outlook for summer freight service between New Bedford
and the Vineyard got even more dubious last week when Steamship
Authority treasurer and acting general manager Wayne Lamson told the SSA
board of governors that the Whaling City has refused to respond to
inquiries from the boat line.

"I am not optimistic," Mr. Lamson said at the February
boat line meeting, held in Hyannis last Friday. "We need to
prepare for the real possibility that there will not be freight service
from New Bedford this summer," he added.

Mr. Lamson recommended that the start of the freight service be
delayed until May 17 to allow another three weeks for New Bedford to
respond. If there is no answer by March 8, Mr. Lamson said, he will have
no choice but to recommend to the board at their March meeting that they
abandon the freight program altogether for this year.

The freight service was set to start on May 1.

The Steamship Authority has been running freight service between New
Bedford and the Vineyard for the last two years, using a contracted
private hauler. The freight program was first launched as a pilot
program, aimed at providing traffic relief to the residents of Falmouth
by taking some trucks off the Woods Hole Road.

The program has cost the boat line more than $1.2 million a year and
has made a modest inroad into relieving traffic, taking about 3,000
trucks off the Falmouth roads over 172 days of operation last year. Last
year the SSA carried 73,271 trucks on the Vineyard run, including the
trucks carried from New Bedford.

This year the Steamship Authority governors made an even stronger
commitment to the New Bedford freight program, voting to have the boat
line run the program using the freight vessel Katama.

The program was scheduled to run from May through October.

But New Bedford threw a monkey wrench into the program in December,
following a vote by the Dukes County Commission to replace Vineyard boat
line governor J.B. Riggs Parker with Kathryn Roessel. Mr. Parker had
been a close ally of New Bedford city solicitor George Leontire.

After Mr. Parker was not reappointed, New Bedford city officials
balked, pulling the plug on a nearly-completed agreement to run a trial
high-speed ferry service between New Bedford and the Vineyard next
summer, and also announcing that they would not allow freight service to
run from the state pier.

Mr. Leontire claimed that the boat line board was no longer friendly
toward New Bedford, even though the board had voted unanimously to
approve the trial high-speed ferry project and also the freight project.

The end of the high-speed ferry project means the boat line will run
the conventional passenger ferry Schamonchi between New Bedford and the
Vineyard again this summer.

The SSA bought the Schamonchi last year in a move led by Mr. Parker,
who had planned to replace the ferry with a high-speed passenger ferry.
The Schamonchi runs out of Billy Woods Wharf in New Bedford; the boat
line has a contract with the owner of the pier.

Last week Mr. Lamson said John Montgomery, a partner at Ropes and
Gray who is the boat line's Boston attorney, wrote two letters to
New Bedford inquiring about the freight service, but has received no
response.

The issue has been convoluted; after New Bedford announced that it
would not allow freight service into the city, Mr. Lamson sent a letter
to Mr. Leontire asking for clarity on the issue. Later in the month the
SSA asked state environmental officials for guidance in the matter. The
state Department of Environmental Management (DEM) actually owns the
state pier, and the New Bedford Harbor Development Commission has a
contract with DEM to manage the pier. State officials replied that the
harbor development commission had taken no official action on the
matter. The SSA then asked to be on the agenda for a meeting of the
commission.

The harbor development commission referred the matter to its
counsel, who is Mr. Leontire.

Amid a series of abrasive remarks at the January boat line meeting,
Mr. Leontire said he would be issuing an opinion shortly on the question
of the boat line's use of the pier.

No opinion has been issued yet.

In January Mr. Montgomery wrote two letters to Mr. Leontire.
"I understand the New Bedford Harbor Development Commission has
referred to you the authority's request for access to [the state
pier]. . . . Please advise me no later than Jan. 22, whether you will
proceed … to resolve the issue," Mr. Montgomery wrote on
Jan. 17.

On Jan. 30, Mr. Montgomery wrote another letter, this time setting
the record straight in light of comments Mr. Leontire had made in a
newspaper about the boat line refusing to commit to "viable
passenger ferry service for New Bedford."

"As you know," Mr. Montgomery wrote, "this
statement is not correct. The authority has not refused to make such a
commitment." He continued: "To the contrary, its members
voted unanimously on Nov. 15, 2001, to undertake a pilot high-speed
passenger-only ferry project on certain terms and conditions which were,
at least at that time, entirely acceptable to the city. It was the city
that pulled out of the arrangement on Dec. 6, declined to respond to
Mr. Lamson's written request on Dec. 7 that the city reverse
course, and then declared on Dec. 18 that there would be no high-speed
passenger or freight service from New Bedford unless the legislature
enacted certain changes to the authority's enabling legislation by
Jan. 15."

At their meeting last week the boat line governors voted unanimously
to set a deadline of March 8 for New Bedford to respond.

"My patience is wearing thin," said Falmouth SSA
governor and board chairman Galen Robbins. "We have done
everything possible to try and make this work, and New Bedford has put
us in this situation."

Mr. Lamson said if the freight program does not run it will not
require any increase in service out of Woods Hole, in part because the
service has not attracted many advance reservations for this year. So
far there are only about 900 reservations, most of them for the early
morning trips, Mr. Lamson said. This translates to about eight to 10
trucks a day.

Advance reservations for freight are down overall this year at the
boat line.

Also last week, Mr. Lamson released a year-end financial analysis of
the New Bedford freight program for 2001.

The SSA contracted with Seabulk International (formerly Hvide Marine
Inc.) to operate the service from April through November.

The service carried a total of 3,030 trucks, or an average of 17
trucks a day. (The program was expanded to permit small trucks,
including pickups, to use the service.)

The total cost of the service was $1.59 million. Total revenues from
the service were $352,470, or an average of $116 per truck. The average
cost per truck to the boat line was $526.

The net loss from the program was $1.24 million, down slightly from
the first year of the program, when the SSA lost $1.29 million.

Revenues from the service covered only 22 per cent of the operating
costs, Mr. Lamson found. The analysis also shows that the Seabulk
Minnesota ran at about 47 per cent capacity over an eight-month period.
Even if the service had run at 100 per cent capacity, the boat line
would have lost $844,000, according to Mr. Lamson's analysis.

The cost of New Bedford ferry service was the central contributing
factor in two fare increases on the Vineyard run last year, including a
sharp increase in the popular excursion fares for Island residents. Mr.
Lamson said if the New Bedford freight service does not run this year,
the boat line will save money, possibly as much as $500,000. He said it
is unlikely that the savings would translate to a fare reduction on the
Vineyard run, but he said it certainly could mean that fares will hold
steady in the coming year.

"As for reducing rates, I think it's unlikely for this
year, but it could be used to keep rates from going up," he said.

Mr. Lamson said the extra money could be put toward the Oak Bluffs
terminal reconstruction project, a capital spending project that is
considered a priority.