Fast Ferry Deal Set, Ending a Long Path

Dockage and Parking Agreements Part of the Package that Will
Establish New Service Starting Next Spring

By JULIA WELLS
Gazette Senior Writer

The high-speed ferry deal is done - or almost done.

Final agreements were signed this week that are now expected to
clear the way for high-speed passenger service between New Bedford and
the Vineyard beginning next summer.

"This signing ends a quest for our community to re-establish
ferry service to the Islands since service ended in 1960,"
declared former New Bedford city solicitor George Leontire in a press
release issued this week. Mr. Leontire, who is now a member of the port
council for the boat line, also announced that he will step down at the
next SSA meeting this month. The meeting will be held in New Bedford on
Sept. 18.

New Bedford city officials, Steamship Authority managers and a
spokesman for the private company that will run the service were all on
hand for the contract signing, which took place in New Bedford on
Wednesday afternoon.

"Today's signing ends six years of hard work by the city
of New Bedford," said Mayor Frederick M. Kalisz Jr. in the press
statement.

Boat line governors voted at their meeting last month to approve the
license agreement with New England Fast Ferry LLC, a newly formed
private consortium. The company plans to run two 150-passenger
high-speed ferries between the State Pier in New Bedford and the
Vineyard year-round.

"We're really excited about getting into this venture,
and we're looking forward to providing good service to the
Vineyard and New Bedford and to creating a new link that we think will
benefit everybody," said Andrew Langlois, a partner in New England
Fast Ferry.

The license deal is still contingent on an elaborate plan to convert
the passenger ferry Schamonchi to a private operation. The plan is aimed
at allowing the boat line to make an end-run around the Pacheco Act, the
state privatization law that now applies to the SSA.

The deal has a number of other working parts that are all now
complete, including:

* A dockage agreement between the SSA and New England Fast
Ferry for the use of boat line terminals in Oak Bluffs and Vineyard
Haven.

* A dockage agreement between the city of New Bedford and New
England Fast Ferry for the use of the State Pier in New Bedford.

* An agreement between the city of New Bedford and the SSA for
sharing revenues from a city-owned parking lot near the State Pier.

SSA chief executive officer Fred C. Raskin said New England Fast
Ferry will pay the boat line $45,000 a year for the use of the piers and
terminals in Oak Bluffs and Vineyard Haven. The company will pay New
Bedford $25,000 a year for the use of State Pier.

In the parking deal, the SSA and the Whaling City will split net
parking revenues 50-50 for the first two years; after two years the
split will change to 60-40 with the larger share going to New Bedford.
Mr. Raskin said the city and the boat line have agreed on a standard
operating cost of $260,000 a year. This is the amount that will be
deducted from the gross parking revenues before dividing up the
remainder between the city and the boat line. He said the city will
assume all responsibility for staffing and maintenance at the parking
lot. Located near the State Pier, the lot can accommodate some 850 cars,
Mr. Raskin said.

Meanwhile, service on the Schamonchi will end this weekend after a
dismal season. Mr. Raskin said traffic on the Schamonchi is still down
about 27 per cent from last year, and any hoped-for improvement in
August did not pan out.

"Things are not improving - they're getting worse.
August is worse than July - the numbers are just falling off the
table," he said.

Service on the Schamonchi will end on Sept. 8, a month earlier than
planned. Boat line governors voted two months ago to end the service
early in an effort to stem the spiraling operating losses on the ferry.
The Schamonchi has lost more than $800,000 a year since the boat line
bought the boat three years ago for $1.7 million from former owner Janet
Thompson.

The decision to shorten the season on the Schamonchi was aimed at
saving about $200,000, but Mr. Raskin said yesterday that he expects the
losses to top $800,000 again this year. "My instinct is
we're probably going to do a little worse," he said.

The last piece of the high-speed ferry puzzle is the plan to convert
the Schamonchi to a private operation. Eventually the boat line will put
out a request for proposals (RFP), but first the boat line must vet its
numbers with the state Executive Office of Administration and Finance.
Under the Pacheco Law, a state agency may convert an operation from
public to private only if it can show that there will be a cost savings.

The boat line plans to offer a subsidy of up to $250,000 to a
private operator to take over the Schamonchi. "If you're
going to outsource you have to show that you will save real money
- so we will work up the numbers and say this is how we're
going to save money," Mr. Raskin said.

"I think we can show the state pretty easily that there will
be a savings by going from a cost of $600,000 to $800,000 to a cost of
$250,000," he added.

New England Fast Ferry is expected to put in a proposal on the
Schamonchi, if only because of a forceful term in the license agreement
with the boat line.

The Steamship Authority has agreed to indemnify New England Fast
Ferry against losses in the event of a violation of the Pacheco Act
- but the protection clause applies only if New England Fast Ferry
puts in a bid to take over the Schamonchi.

"We have to do it - we will be putting in a bid,"
said James Barker, a partner in New England Fast Ferry, following the
boat line meeting on Nantucket last month.

In the end, Mr. Raskin said yesterday that while the whole deal may
be a complicated piece of work, it is the right deal for the public boat
line.

"I wish them good luck - this is their kettle of fish,
so to speak. I know I've got a good operator in there," he
said, referring to New England Fast Ferry. "I hope they do well,
but quite frankly I still have some concern about whether there is a
real market for this. And that's why I think we have done our job
in protecting our core function."