Here's the cut/past of Mr. New's comments, in the above link that LandLocked posted. I've done this to make it easier to find and read....for those who are as lazy as me!
Finally, some reading on Coastal Ferries history, without tiring riddles and half-stories only provided. But I digress....I'm just so happy to finally have some "easy reading" of the Coastal Ferries full story.
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New Opportunities and Challenges for Ferry Operators in British Columbia
Perspective from a Former Ferry OperatorBeing here today reminds me of a TV series that ran from 1966 to 1973 called “Mission: Impossible” in which the unseen secretary assigned the “impossible mission” through a self destructing tape. The message always pointed out that if you accepted the mission and were captured, the secretary would disavow any knowledge of your existence.
The “Wright Report” was produced in December 2001 and included the statement “greater private sector involvement would offer consumers a cost competitive choice with efficient service and be customer focused”. The government then produced BILL 18-2003, the COASTAL FERRY ACT, their political attempt to stop the financial hemorrhaging of B.C. Ferries and we are here to discuss Section 69 ADDITIONAL or ALTERNATIVE SERVICE PROVIDERS and the SUPPLEMENT.
In reflecting on my experience as a private ferry operator, one needs to consider the B.C. Government’s decisions to enter the ferry business through the Department of Highways and B.C.
Ferries. These decisions held us down and inflated Government’s cost of doing business. Collectively they pushed us out of six coastal routes by the time we ceased operations in 1997.
My late father Sparkie and I guided our marine activity through Coastal Towing and Coast Ferries for sixty years, a period of dramatic change from our corporate beginning when free market rules and private ferry operators led the marine activity in British Columbia. Coastal Towing operated from 1937 to 1959, when Dad recommended we sell the last three of a dozen tugs and the log sorting division at Andys Bay on the west side of Gambier Island. He reasoned that real marine growth would come through Coast Ferries. That plan started in 1945 with the purchase of Cascade Freighting and Trading Co. Ltd. and their vessel, renamed BRENTWOOD. She was refitted and commenced service in 1946 as a 16 car ferry with a Provincial Government contract. The Government built new ramps by 1950 and the company built the MILL BAY, another 16 car ferry by 1956. The two vessels operated until the Malahat Highway improvements advanced to where more drivers preferred the highway by 1959.
Our company launched its freight service in 1954 and within 12 years we had three ships providing scheduled service from Howe Sound to Rivers Inlet. We now served 162 stops that were regular calls or by arrangement. In those days the major logging was done at the heads of the inlets where river valleys made the forests easier to access. These customers provided the incentive to enter the inlet and it just made sense to steam up one side and down the other, providing a scheduled freight service to
everyone in the inlet. No one account justified the service, a reality that exists today on many of the B.C. Ferries routes.
The C.P.R. approached Dad in the early 50’s to take over their Gulf Island run and we began in 1954 by chartering the LADY ROSE, a 100 passenger vessel, with space for two cars. Her run began from Steveston to Galiano, Mayne, North Pender, Saturna and Saltspring Island. The run grew beyond the vessel and we built the ISLAND PRINCESS, a 300 passenger-20 car ferry, which was in service within 4 years, equipped with cargo gear and a lower hold. By this time the Provincial Government subsidized company, Gulf Island Ferries, running between Salt Spring and Swartz Bay, had extended its service to the outer Gulf Islands. They charged a passenger one dollar from the islands to Swartz
Bay while our rate was two dollars to Sidney. Our market continued slipping - even many of the ISLAND PRINCESS investors switched to the subsidized carrier!
The last straw came when the Government announced the building of two vessels for the Mainland-Vancouver Island service between Tsawwassen and Swartz Bay with service beginning June, 1960. A political storm had been brewing since the B.C. Government announced the building of two vessels, a decision that followed a simultaneous strike by the C.P.R. and Black Ball Ferries. The Premier was not prepared to have voters cut off from getting to the Legislature. Dad challenged him in the press for
previously stating the Government had no intention of getting into the ferry business! The press quoted him in July 1960: “the Government should get out of the ferry business. Otherwise, in due time private enterprise will not be able to pay the deficits on Government operations”. At that point the Premier sent his executive assistant to offer Dad a major role in the new ferry operation, an offer he refused! Gulf Islanders continued to lobby the Government to take over the Gulf Island Ferries operation which they did by 1961. Sadly, the owner Gavin Mouat was suffering from a terminal illness when the Government bought his company. He had a friend invite Dad to the hospital, where he apologized for selling his company, because he knew the negative impact it would have on the ISLAND PRINCESS earnings. The Government took over Black Ball Ferries at the same time.
By the spring of 1961, we had reduced the Gulf Island service for the summer and launched an overnight one from Steveston to Powell River, Texada and Comox twice a week. This was an
immediate success, even with limited ro-ro loading ability. We designed a new vessel better suited for the run and requested a letter confirming that the Government would pay us market value for the ship and ramps if they ever decided to expand into the area. They refused and issued an immediate press release that the Department of Highways would commence the process to provide the service. Our last round trip to the Gulf Islands was November 15, 1961 and following a minor refit the ISLAND
PRINCESS departed Steveston for her new life. She was to connect the northern end of the island highway at Kelsey Bay to Beaver Cove, Alert Bay, Port McNeil and the home port of Sointula. We grew this service by installing ramps at Kelsey Bay and Beaver Cove. A second vessel for the route was being considered in 1968, when the MLA for the area advised that he would not get re-elected if our user pay rates remained. Cabinet had decided that we would be pushed out or bought out. We
agreed to leave the ro-ro ferry business and sold both the Kelsey Bay-North Island and Brentwood-Mill Bay operations to B.C. Ferries by June of 1969.
In the 1970’s we were still in the shipping business, carrying freight to mainland communities as far north as Port Simpson at one time. We continued to have challenges – forest fires and I.W.A. strikes in the summers and reduced revenue in the winters – but we worked with other private companies and
received some federal and provincial subsidies to ensure continuous regularly scheduled service to many smaller communities along the coast. We also looked for other markets including carrying processed fish for B.C. Packers, operating as a fish processor and using a 12 passenger stern loading ro-ro and freight vessel with cargo gear.
By the late 1980’s we were down to one vessel, the TYEE PRINCESS, which kept operating through out 1987, when the company’s receivership process began in June. Our proposal to creditors - a 6 year plan-was accepted and our old bank - now restructured - provided new financing. A plan for a Freighter Travel Venture had never left my desk and by 1990 the refit costs had been revisited. With a funding plan in place, the Provincial Transport Minister was advised of the opportunity and asked to
encourage B.C. Ferries to be one of the participants in a long term improvement of service to the central coast. A 25% five year investment proposal, with interest, was turned down by the Board and by 1991 B.C. Ferries called for public tendering for the central coast service and awarded the contract to a company operating three landing barges. TYEE PRINCESS carried the equivalent dry storage of ten 40 foot highway trailers, something all three landing barges couldn’t do. The minister would not
revisit the decision or request management visit central coast residents to explain the service change in which shipments would be consolidated in Richmond trucked to Campbell River and landed on some beaches of the communities!
We applied to the Office of the Ombudsman who replied that they did not question political decisions and advised “the problem stems from the language of the Request for Proposal and expectations it created… your concerns were entirely understandable and are best summed by your statement “that
what appeared to be asked for in the RFP and what was contracted were two entirely different things”. The new contractor was paid for five years and never serviced the contracted area because we kept operating thanks to customer loyalty and dramatic cost cutting.
We launched our vision for the Central Coast service changes in 1995 to the new NDP Government’s MLA for the area, who was by this time a Cabinet Minister. He expressed some interest and we started a public communication process. Our Business Plan drew attention to a B.C. Ferries proposal to install a ramp at Bella Bella with private carriers doing the distribution for a hub and spoke concept. We promoted a 40 car ferry to link Port McNeill to the Central Coast and Bella Coola in the summer as
tourist traffic between Prince Rupert and Port Hardy would be bumped in direct proportion to the Central Coast demand on the hub and spoke plan. The Mayors of Port McNeill, Port Hardy, Williams Lake, Prince George and Prince Rupert agreed. B.C. Ferries then launched a process of public input and published a list of transportation choices with the private sector option appearing at the bottom. In the final chapter of a long process, the MLA for the area decided that the residents’ first choice for a
private sector plan was unacceptable and advised one Mayor that B.C. Ferries would either be implementing the Coast Ferries plan or there would be no change from the present service. He also told the Mayor that the special funding request was in jeopardy without his support.
We had located a very suitable closed shelter deck ro-ro vessel in the Faro Islands and completed all the approvals on paper to meet Canadian Coast Guard requirements. This effort ceased when we received B.C. Ferries draft RFP for Rivers Inlet which stated that “it was the intent of the Corporation to meet the marine freight requirements of Klemtu, Ocean Falls, Bella Bella and Shearwater year round with B.C. Ferries vessels”
The Premier was informed days before the May 1996 election that our predictable demise needed a review for Fairness and the Job Commissioner was appointed. He recommended the use of an Arbitration Process to consider the question of “What is fair compensation which British Columbia Ferry Corporation should pay to Coastal Towing Co. Ltd. as a result of the Corporation implementing its mid-coast service?” The award was fair and reportedly the first Arbitration case in Canada on the
question of “Fairness”.
Our last sailing left Vancouver February 19, 1997; we had survived 60 years, but the Mission had become Impossible! As a result of these experiences, let me cast my thoughts to the future.
Forty-seven years ago Sparkie challenged the B.C. Government that going into the ferry business would eventually cost the taxpayers more than they could justify. He was right. The COASTAL FERRY ACT was put in place two years ago and I remind you the last directive of consequence from another Government forced three fast cats to be built. I believe the management team at that time preferred more double-ended vessels but failed to stop the construction. Today, B.C. Ferries is seeking thoughts on tendering various routes and tendering themselves on some. Management apparently believes the new corporate structure will be much healthier to retain that work but due to the
COASTAL FERRY ACT it must tender for ALTERNATIVE SERVICE PROVIDERS. The delay on tendering for Powell River – Comox and Powell River – Texada routes is a good example, where timing is now apparently controlled by the Government. Could that be because they lost the riding to the opposition?
In addition, according to the SUPPLEMENT TO ALTERNATIVE SERVICE PROVIDERS PLAN, B.C. Ferries runs the risk of having to acquire vessels from defaulted contractors. This will risk inheriting increased costs by having to operate non standard vessels to that of the ferry fleet. B.C. Ferries is finally in the best position, having absorbed virtually all the established ro-ro ferry routes, to
prove efficiencies can be had with a ferry monopoly considered to be an extension of our Provincial Highway system.
I believe that a Public-Private opportunity in the movement of commercial truck traffic has existed for years and should be seriously explored under the ALTERNATIVE SERVICE PROVIDERS PLAN. David Hahn has shown incredible determination and skill along with his team in moving the enterprise towards a world-class service and cost conscious business. He should not be bogged down with an ALTERNATIVE SERVICE PROVIDERS PLAN for private sector public use ferries at this time. The office of the commissioner is duly empowered to receive and rule on any management proposal. Public reaction indicates that regular users have an emotional attachment to B.C. Ferries and support a one ownership, one management model. My thanks to Martin Crilly and all of you here today for your time.
Bill New
June 15, 2005.
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