BC Ferries & the Sunshine Coast: **Prices subject to change without notice**

[Skook]

Grab a coffee and kick back. This is a long one...

It has been a while since I’ve given BC Ferries any attention. I have actually been thinking about ferry travel between Horseshoe Bay and Langdale especially as of last month when I looked at the Benchmark Price Index page including in the REBGV July stats package; but, more on that in a moment.

What has prompted this post is a news story that appeared last week in the SC’s Coast Reporter:

Quote:Province to get an earful on ferry cuts
September 13, 2013
John Gleeson/Staff Writer

Premier Christy Clark and the new minister responsible for BC Ferries will get an earful at the Union of British Columbia Municipalities convention next week, if local government leaders on the Sunshine Coast have their way. Hoping to ward off expected cuts to the coastal ferry service, a delegation of chairs and mayors from all ferry-dependent communities will meet with the premier and Transportation and Infrastructure Minister Todd Stone during the convention, Sunshine Coast Regional District (SCRD) chair Garry Nohr told members of the transportation advisory committee on Sept. 9. And in an effort to put greater pressure on the provincial government, the committee voted to ask the heads of ferry-dependent communities to also hold a press conference during the convention, spelling out the potential impact of cuts on coastal economies.

“The only way to respond is to make this a media issue,” said District of Sechelt Coun. Doug Hockley, who suggested the press conference. “To me, pull the pin on the grenade, throw it under the table and see what happens.” Hockley pitched the idea after the committee heard from Nohr that Stone had declined a requested meeting with a Sunshine Coast delegation during the convention, which runs from Sept. 16 to 20 at the Vancouver Convention Centre.

Last month, the province announced it was hiring a consultant to develop “a route-specific ferry adjustment plan to ensure the sustainability of the ferry system.” Public consultation on the plan, which is intended to save $19 million by 2016, is scheduled for November and December.

Barry Cavens, chair of the southern Sunshine Coast ferry advisory committee, brought his request for a needs assessment to the Sept. 9 transportation meeting, “so we go into these hearings with expectations of what we want as a community.” But Roberts Creek director Donna Shugar said the process was “mystifying,” after last year’s round of public consultation on the issue. “We attended all those meetings,” Shugar said. “It was clear that people of the Sunshine Coast had a vision that this is part of our highway system and the province had to recognize that.”

“I don’t think the government learned from that process,” Cavens said.

“In other words,” Shugar said, “they didn’t get the answer they wanted.”

Nohr, who said it was obvious to him from the start of the consultation process last year that “it was pre-programmed,” called for a constructive approach, rather than to “react and bitch about it.” “I think we have to go with a view to saying what we’re prepared to do to keep costs down and how they can possibly do a better job,” Nohr said. One idea, he said, is to propose that BC Ferries offer a family package, with three or four trips at a reduced rate, from October to May.

“That alone would bring hundreds more people over,” he said.

Hockley, however, expressed skepticism about the provincial government’s willingness to listen. “I’ve been hearing this for 16 years. Nothing’s happening,” Hockley said. “They don’t care what their cutbacks mean. They’ve already decided. This is just tokenism.”

West Howe Sound director Lee Turnbull agreed. “We’ve had a huge lack of response here,” Turnbull said.

The issue, Hockley said, “needs to be blown up to the press so it ends up on the table of politicians.”

In response to Cavens’ call for a community needs assessment, directors agreed that the southern Sunshine Coast ferry advisory committee should develop a proposal and that Cavens should present it at a future SCRD infrastructure services committee meeting.”

This Coast Reporter piece followed on the heels of this August news story…

Quote:FAC chair wants needs assessment
August 23, 2013
John Gleeson/Staff Writer

The public will have a chance later this year to respond to plans for cutting costs on BC Ferries, but the chair of the southern Sunshine Coast ferry advisory committee wants to see a community needs assessment first. “The way I read it, they’re going to consult with the people after BC Ferries and the government decide what is appropriate,” Barry Cavens said in an Aug. 21 interview. “I think we as a community should decide what we want first.”

Last week the provincial government issued a request for proposals (RFP), inviting consultants to bid on a contract that would include developing “a route-specific ferry adjustment plan to ensure the sustainability of the ferry system.” Public consultation on the new plan is expected to take place in November and December, as the province attempts to realize $19 million in cost savings by 2016.

Cavens said the RFP “seems to be referring to the sustainability of BC Ferries and the government,” not the communities being served by BC Ferries’ 25 routes. “What we need is a needs assessment to see what we need in terms of service on the Sunshine Coast — in order to make the Sunshine Coast sustainable,” he said.

The RFP follows last year’s $1-million public consultation process, and Cavens noted that it was “inferred” by government officials at the packed meetings in Gibsons that low-volume sailings such as the first Sunday morning run and some night runs could be on the chopping block. “We have to ask who’s on those sailings,” Cavens said “Are they people going to work? It’s more than just the numbers. It’s how it affects the community if those needs aren’t met.”

While the community did speak loud and clear during last year’s consultations, Cavens said that after reading the RFP he is not confident the concerns raised will be reflected in the service adjustment plan. “As a community we have to ask, ‘What do we need?’” he said. “Maybe we need smaller boats going every hour. Is there a better model in the long term?”

Cavens said he intends to bring the issue to the table at next month’s regional transportation advisory committee meeting, “and see if there’s a desire amongst the community to put something together as a document to have the government look at as part of the consultation process.” The timing is critical, he added. “If we don’t have something for this round of consultation, we’re going to be locked into something for the next 10 or 20 years. If we don’t have that discussion, what’s the impact going to be?” he said.

Apart from smaller vessels, another idea that was suggested during the Gibsons meetings was augmenting the current ferry service with one small vessel for foot passengers only. “Those are the kinds of things we need to hear from people,” Cavens said. “I think we need a fresh look at what is required. This is one opportunity.” A submission from the community will also remind the province that BC Ferries is providing a vital service to the Coast, he said. “It sends out a message that we care about our ferry service, and as a region we want to have as much say as possible in any changes to it.”

The deadline for bids is Aug. 27, and the implementation date for service adjustments is March 2014.”

There was also a Victoria Times Colonist piece on August 9, 2013, ‘The refitting of B.C. Ferries’. The Jack Knox article was picked up by others in the newspaper chain appearing as ‘Smooth sailing doesn’t come cheap at BC Ferries’. Knox was writing about the constraints facing BC Ferry Corporation and a major impending issue…

Quote:“…On-board staffing is dictated by federal transportation safety rules. Likewise, the corporation has little say in where or how often its ships sail; that’s all laid out in its contract with the provincial government. Not much it can do about fuel prices, either. The result is that the great bulk of BC Ferries’ costs are beyond its control.

Meanwhile, it operates with a level of government subsidy far lower than that of comparable ferry systems, with the province stubbornly pushing BC Ferries toward a user-pay model even as critics scream that rising fares are pushing ridership — and therefore revenue — down.

As it wriggles away in this straitjacket, more financial pressures are coming. The big ships on the major routes have been replaced, but many of those on the intermediate and minor runs have passed their best-before date. “Our minor fleet is 35 years old, on average,” says BC Ferries CEO Mike Corrigan. “That’s an old ferry fleet.” The question then, as the corporation heads into Phase 2 of its fleet-renewal program, is how they’re going to pay for it all.”

Knox goes on to detail the 34 ferry ships that ply the water of the intermediate and minor runs including…

• QUEEN OF COQUITLAM. Built: 1976. Capacity: 360 cars (including 12 semis), 1,488 people. Horseshoe Bay-Departure Bay, Horseshoe Bay-Langdale. Refit in 2003 was meant to extend life 20 years.
  
• QUEEN OF SURREY. Built: 1981; Capacity: 360 cars (including 12 semis), 1,488 people. Horseshoe Bay to Langdale.
  
• NORTH ISLAND PRINCESS. Built: 1958, the year Ford made the Edsel. Capacity: 49 cars, 150 people. Sails between Powell River and Texada Island.
  
• QUEEN OF CAPILANO. Built: 1991. Capacity: 85 cars, 451 people. Travels between Horseshoe Bay and Bowen Island. Vessel to undergo mid-life upgrade in 2015.
  
• BOWEN QUEEN. Built in 1965. Capacity: 70-car, 400-passenger Augments Southern Gulf Islands-Salt Spring Island-Tsawwassen run in July and August and serves as a relief ship.
  
• MAYNE QUEEN. Built in 1965, 70-car 400 passenger open-deck ferry serves between Swartz Bay and outer Gulf Islands.
  
• POWELL RIVER QUEEN.Built in 1965, 68-car 400 passenger vessel shuttles between Campbell River and Quadra Island.
  

Now, keep all this ferry news in the back of your mind.

So what has the benchmark price index to do at all with ferries, you may ask. When I prepared my analysis of Sunshine Coast Benchmark prices in my ‘Interpreting Sunshine Coast Real Estate Sales - The 3 Amigos’ thread in August, I looked at that REBGV Home Price Index data sheet and asked myself, is there any market area within the REBGV showing the same number of negative readings across time spans as the Sunshine Coast. I notice one area and you can see it highlighted along with the Sunshine Coast on the August HPI sheet below…

So, what has the Sunshine Coast and Bowen Island have in common? Here are two common denominators: a large recreational property owner base and commuters that head to lower mainland for work. How do either get to and from Bowen Island and the Sunshine Coast? There is only one way - a ferry.

Is it possible that the cost of ferry travel has begun to have such a profound affect that it is playing a significant role in both the BI and SC moribund real estate markets? I am beginning to think so and I here is my own anecdotal evidence for the Sunshine Coast.

When I first arrived on the coast in ’95, you couldn’t turn around in the summer without running into a tourist. Cheap fuel and cheap ferries meant lower mainland residents were taking day trips on the weekends to escape the city. It meant pleasure craft tied up three across at government wharfs during the peak weeks in July and August. It meant nightmare drives on the coast highway and getting stuck behind pick-ups with campers and lots of RVs. It meant bumper to bumper traffic from Sechelt to the ferry terminal; and sailing waits at the height of the season. Above all, it meant that recreational property owners (the vast majority from the lower mainland) could afford to escape the city every weekend - being only 2 hours from the city was the major reason they bought on the SC.

It was a different world by 2007. Daytrippers - long gone. Government wharfs - no problem tying up now and the pleasure crafts had been replaced by cheap to operate sailboats. Highway travel - piece of cake even on weekends. Ferry travel - no need to leave a few hours early to be first in line and no more sailing waits except for the few long weekends over summer. And the recreational property owners - well, they’re only showing up on the long weekends, too, or when they’ve booked off blocks of holidays from work. The ones I had got to know over the years all admitted they could no longer afford the trip up from the city on a regular basis. All of this has had a profound economic impact over the past decade for SC businesses that depend on tourists for their survival.

So, here's what it costs now to take a ferry to BI (on the left) and the SC (on the right)…

In my first post in this thread, I traced in tables and a chart how the path of ferry costs for the Sunshine Coast for a single vehicle with two passengers. That cost now stands at $78.15 and next April will increase 4% and the year after that by another 4% so that by April 1, 2015 that SC return trip will be $84.52.

Now, think back to the first news article above. Not only do we know ahead of time that fares are going up 8% over the next two years, but BC Ferries says it still isn’t enough to meet its operating costs so now they have to cut back on scheduled sailings - it’s “been there, done that” already for SC residents. BC Ferries is caught in a vicious cycle of raising fares to meet costs which leads to lost ridership then raising fares again to make up for that lost revenue only resulting in further lost ridership…ad infinitum.

This is where ‘commuters’ come into play. Ten years ago, when RE prices began their climb in the lower mainland there were many who cashed out, bought cheap on Sunshine Coast and banked some nice change. Those still working in the city settled in somewhere between Gibsons and Sechelt and commuted daily - back then they could afford to, but now? I doubt it. Even if they take advantage of the BC Ferries ‘Experience Card’ the costs are adding up. What has to been remembered is that card requires a minimum “load” and here are the details plus important info about reservations (think sailing cutbacks here)…

Quote:Q: What is the minimum load amount [needed on the card] to receive savings?
A: The minimum load amount for Vehicle and/or Passenger savings is $105.00. The minimum load amount for Passenger-only savings is $60.00.

Q. Will BC Ferries Experience™ cardholders receive a specific number of trips for loading the minimum amount?
A. No. Loading the minimum amount entitles a BC Ferries Experience™ cardholder to access the reduced fares for either passengers or vehicles and passengers respectively at the current price at the time of travel.

Loading a minimum amount does not entitle a specific number of trips and there must be sufficient balance on the card to cover the entire fare. Customers will be charged the current reduced fare. If there is not sufficient balance on the card to cover the applicable reduced fare, customers will be charged the full cash fare.

Reservations:

Each one-way reservation is charged a non-refundable reservation fee as follows:

• $15.00 if made 7 or more days in advance of the sailing's scheduled departure date, or
  
• $18.50 if made less than 7 days in advance of travel.
  

For example, if you make a one-way reservation on Monday for the following Monday, the fee will be $15.00. If you make a reservation on Tuesday for the following Monday, the fee will be $18.50. So you can save money by booking 7 or more days in advance of travel.

If you need to change a reservation, a $9.00 change fee will apply.

The non-refundable fee is paid by credit card during this on-line transaction when you confirm your reservation.

Even if commuters are driving to the ferry, parking, and walking on, the costs are mounting. I would not be at all surprised to learn that many of the homes now for sale from Gibsons to Sechelt are owned by those who can no longer afford to live on the coast and commute to the city for work. Also, that many of the rec properties particularly north in the Pender Harbour are on the market because the owners are saying. “What’s the point if we can only afford to go a few times a year? We might as well sell and buy somewhere else within a four hour drive.”

As I mentioned, lost ferry sailings is not a new issue for the coast. When it happened before, the hue and cry came from those with young children on sports team who wouldn’t be able to get to and back from scheduled games (many on weekends) in the city all in the same day. Well, there aren’t as many households with young children on the coast anymore and school amalgamations confirm this. I wonder why?

How can the ferry issue not be a key factor affecting real estate on the SC and BI? If you are currently living in either area or looking at properties in either market, you have to be weighing that added cost (which continues to mount) especially if your work, interests, and family needs are taking you into the city on a regular basis. Now, with the threat of fewer sailings, the issue is becoming critical not only for Sunshine Coast but for all BC communities dependent on BC Ferries for their survival.

Yes, the Premier and her minister should brace for an earful.