Council wants assurances on fast ferry proposal

Will meet with Interstate on Jan. 14
Thu, 01/03/2019 - 7:15pm
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The New Shoreham Town Council will be asking Interstate Navigation at an upcoming special meeting why the town was left out of the loop concerning the ferry company’s interest in building a 500-passenger fast ferry. The new fast ferry would be double the capacity of its current high-speed vessel that operates between Block Island and Pt. Judith. Although the proposed ferry could accommodate twice the number of passengers as the ferry it would replace, the Athena, the town is looking for assurances that there would be no rate increases or a reduction in runs.

That’s according to First Warden Ken Lacoste, who attended a public hearing on the subject, along with Councilor Sven Risom and Town Solicitor Katherine Merolla, at the Warwick office of the state’s Division of Public Utilities and Carriers on Dec. 27.

At the hearing, the Division heard Interstate’s request to borrow $8.5 million to construct the vessel. The total cost to build the ferry is $10.5 million, with Interstate contributing $2 million from its own finances. The company said it expects the boat to be completed by Memorial Day 2020.

Lacoste said, “The town expressed a desire (at the hearing) for assurances that funding and construction of the new fast ferry would not require rate increases nor create a reduction in scheduled runs.” He said, “The new ferry will be replacing the Athena, not introducing an additional fast ferry to the traffic” at Old Harbor. The vessel “will be able to dock at the same place as the Athena; although it was questioned whether the current Pt. Judith dock would still be viable. That question was not addressed at the hearing.”

“The new ferry, by virtue of its size, would be more seaworthy due to length and freeboard, and more efficient, fuel-wise,” said Lacoste. “I believe it was stated that the seasonal net increase in riders would only be about 8,500 or so, as the majority, 60 percent, would be passengers who have been taking the slow ferry.” He noted that, “Interstate said it was not practical to handle increase in demand during peak times with more runs of the Athena.” The Athena offers up to 12 trips per day during the sumer season.

Risom told The Times that he “only attended the end of the meeting. Personally, this seems like a very reasonable request that is consumer/tourist/resident driven. Interstate underestimated the demand for higher priced/shorter travel many years ago and is working to catch up. Target is 2020 to get the boat operational. They have consistently invested in new boats to better address the needs and demands. This seems like a natural extension.”

Lacoste said Interstate’s attorney, Michael McElroy, stressed at the hearing that the company’s “obligation is to provide the island with its lifeline services and to keep the lifeline rates down.” He also said that “since the days of the Manitou and Manisee, every new vessel Interstate has built, or added to its fleet, has been ‘a success.’”

Interstate, which is embroiled in a legal battle opposing Rhode Island Fast Ferry’s quest to operate a seasonal high-speed service from Quonset to Old Harbor, noted its concerns regarding competition. Lacoste said, “Interstate’s CPA, Dave Bebyn, stated ‘absolutely,’” when asked about the company’s concerns. “If ridership stays with Interstate,” he said, “it is good because that helps support the lifeline service.”

Bebyn reported that ridership totals peaked for the traditional ferry service in 2017 at 425,000, while ridership for the fast ferry also peaked that year at 100,000 passengers. (Ridership in 2012 was 388,000 and 73,000 respectively.)

Lacoste said Bebyn “felt that weather has an obvious effect but that the support for increased fast ferry capacity was sustainable.”

RIFF owner Charlie Donadio, Jr., who also attended the hearing, told The Times that Interstate’s request contradicts its testimony concerning RIFF’s proposed service.

“The town and Interstate have said there is no demand for another fast ferry service, and too much congestion at Old Harbor,” Donadio said, referencing the reasons why the two have opposed his ferry service. “Interstate’s trying to rush this thing through; and I personally believe it’s based on competition.”

Lacoste said the Town Council “will be meeting with Interstate on Jan. 14 to discuss our concerns, including the scheduling and rate structure regarding the year-round service, and why the council was not informed about the possible new ferry when the decision was reportedly made two years ago, according to Josh Linda.” Linda is a co-owner of Interstate Navigation.

Lacoste noted that at the meeting’s conclusion, “Special Assistant Attorney General Christy L. Hetherington said her office neither supported nor rejected Interstate’s proposal at this time.”

(See the attached transcript of testimony from the Dec. 27 hearing.)

Previous discussion on Dec. 19

The subject was discussed at the Town Council’s Dec. 19 meeting, when Councilor Chris Willi expressed feeling blindsided by the news that Interstate had plans to build a bigger fast ferry. While the council voted unanimously at the meeting to send a town official to that hearing, Willi appeared frustrated with having virtually no time to discuss the issue. 

“This is the first opportunity the council gets to discuss this?” asked Willi during the meeting, noting that the council received news of Interstate’s filing request on Dec. 11. Willi noted that the town and Interstate are engaged “in litigation with RIFF, a ferry company that wants to operate in Old Harbor, and we get an application for Interstate wanting to build a bigger fast ferry.”

“This leaves a bad taste in my mouth, to be honest,” remarked Willi. “Our attorney works side-by-side with their attorney, and this literally comes out of the blue, and I’m wondering why.”

Willi said that he wanted to speak with Merolla about the topic. Merolla has been litigating the RIFF case, alongside Interstate Navigation, on behalf of the town.

Second Warden André Boudreau said he had spoken with Merolla, and she told him that Interstate’s hearing on Dec. 27 “was about incurring debt.” He said the town could object to the application if the company was going to raise rates because of the debt.

Donadio, present at the meeting, said he was surprised by Interstate’s request for building a bigger fast ferry. “If they’re not successful with this service you will see a rate increase.” He added: “I’m blown away. They testified before the Division that there was no demand for another fast ferry to keep me from getting my license. This is a wakeup call. It’s history all over again. That’s my two cents.”