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Post by Low Light Mike on Oct 22, 2008 8:46:09 GMT -8
Here's a thread to discuss the idea of a Road Equivalent Tariff (RET) basis for ferry fares. Here's the Scotland government's website re the RET: www.scotland.gov.uk/Topics/Transport/ferries-ports-canals/14342/TARIFF------------------- Scotland is now experimenting with RET on some island routes, until 2011. This ongoing experiment should allow us some relevant discussion in applying the Scotland experience to our BC coastal community issues. ps: this is an issue that many on the ferry-advisory-committees on the BC Coast are well aware of. So RET is already a buzz-word here in BC (at least with those who live on the small islands). pps: I've put this in a new thread here, so that we can have easier ongoing discussion on this topic, without the discussion being buried by other int'l news stories.
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Post by Low Light Mike on Oct 22, 2008 8:55:22 GMT -8
Here's a long story from the UK Herald paper on the RET experiment in Scotland. There are lots of parts of the story that we can break-off and discuss. ========== (note: I've cut/pasted the whole article, in case it's unavailable for view in the future). www.theherald.co.uk/news/focus/display.var.2461909.0.On_course_for_cheaper_ferries.php--------------- For years, Scotland's island communities have gazed enviously across the North Sea at the "fjord formula", Norway's system of ferry pricing which is based on the cost of making a journey of the same length by road. If only the same kind of system could be adopted here, they said, then our islands would be able to realise their true potential with the lifting of crippling transport costs. Well, now they can. In some areas, at least. Since Sunday, the Scottish government's Road Equivalent Tariff (Ret) pilot project has been operating in the Outer Isles and the Argyll islands of Tiree and Coll, bringing fare reductions of around 40% on their lifeline services to the mainland. It means that a single fare for a car on the Ullapool to Stornoway route, which cost £59 this time last year, will now cost £36.35, while the driver's single fare drops from £12.45 to £7.25. Taking a car from Oban to Barra, £68 last winter, will now cost £48.50, while the driver's ticket drops from £16.70 to £10.95. There will be similar reductions on the other Ret routes. The new fares include a core cost plus an Ret rate - for example foot passengers pay a core rate of £2 plus an Ret rate of 10p per mile. Meanwhile cars pay a core rate of £5 plus an Ret rate 60p per mile. The £17m project will run until spring 2011. Then it will be fully assessed to see if it is indeed the panacea to the islands' economic problems as many have long claimed. Of course, as a pilot scheme, it means that, for every island route which benefits, there is another which does not. At Oban pier yesterday those who arrived in the morning from South Uist enjoyed the cheaper fares. Those who left Oban for Mull in the afternoon still paid the old fares. Donald Morrison, 44, who works for the local council on Mull said it was "disgraceful" that some islands had been excluded. "A lot of people aren't happy about this," he said. "We have a lot of traffic going to and from Mull so why shouldn't we get something out of this new scheme? "We pay far too much as it is and this isn't helping islanders. Whoever makes these decisions hasn't considered the impact this has on the islanders who use the ferry most." Callum Entwistle and his wife Jackie own a bread and breakfast on Mull. They said the majority of their guests complain about high ferry costs. "Reduced costs would mean a boost for the island," said Mr Entwistle. "The outer islands have a hard time in relation to the cost of ferrying back and forward to the mainland. It's about time something change. This season we were down on guest numbers and the number one complaint was ferry costs." But regular ferry users from Oban said yesterday any effort to bring the cost of ferrying down was welcome. Murdoch MacDougall, 60, lives in Oban and visits his family in Barra and South Uist on a regular basis. "It's definitely a step in the right direction," he said. "From what I can tell the shorter trips are more expensive at the minute with the new scheme but at least something is being done at some level. My family use the ferry a lot and notice the costs can be very high." For many ferry passengers, trips in and out to the mainland are essential for business purposes and the cost of ferrying can be high. Businessman Patrick Geall, 50, from Mull, uses the ferry once a week to do business in Glasgow. He said: "Any reduction in the cost of bringing a car on the ferry would be helpful. I travel on a regular basis and the ferry costs all add up." Western Isles SNP MP Angus MacNeil and his Holyrood counterpart Alasdair Allan, were confident yesterday that Ret would make a major difference. Mr MacNeil said: "This pilot project is a real big deal. The islands now have a great economic opportunity. Anybody considering relocating business to the islands will find that there is no time like the present. I have been keenly campaigning for this for at least eight years now, even before I got into active politics. Therefore, I have to say that I am very proud of these steps by the SNP government." He added: "What a sharp contrast this is to government by Labour with LibDem transport ministers who failed to cut ferry prices and refused to look at Ret. This is a great start and they should consider how it can be extended rather than carping from the wilderness." Mr Allan said: "People have been awaiting Ret in the islands for the best part of 40 years and the waiting is finally over. "Ret will help to make the economy of the Isles much more competitive with that of the mainland at a very important time and, crucially, it will be available to everybody travelling to the Western Isles and not just those who live here. I would urge all Western Isles residents to take full advantage of this scheme." But others were not quite so swift to judge the system on such a positive note. Mabel MacArthur, the chair of Tiree Community Council, said the jury was still out on whether the communities would benefit. "Although Ret is coming in for Tiree we are losing our book of concessionary tickets for three return journeys. As far as I can calculate it will mean a £5 saving on a car for an islander, but of course more for the tourists who didn't get the concessionary tickets," she said. "So Ret will only benefit the island if petrol prices, cost of heating oil and prices in the shops start to come down. " What we really need is a ferry every day. We only get one on four days a week during the winter, and often you can't get a booking for your car and you have to wait, even in the depths of the winter. Ret could make that even worse." The Hebridean communities not included in the Ret pilot are feeling badly done by, not least on the islands of Islay, Mull, Iona, Colonsay, Jura, Bute and Gigha. They argue that they should at least enjoy a 40% ferry fares discount scheme, similar to that enjoyed by island communities on some air routes. Mull councillor Mary-Jean Devon believes that ministers missed a real opportunity by not including the likes of Colonsay in the trial. The ferry from Oban only makes the two hours and 20 minutes journey three times a week in the winter. "Colonsay has a population of just 120 people but it costs more than £60 for a single ticket for a car and driver on the ferry, which doesn't even call every day," she said. "It costs even more in the summer. Colonsay badly needs regeneration and would have been the ideal island for the Ret trial. It is the end of the line. We are having a meeting in Oban on Friday to finalise our case to ministers for a review of ferry fares and a 40% discount card." There has been criticism from Orkney and Shetland that the seven island locations which have been chosen to benefit from Ret all happen to be in the SNP-held constituencies of the Western Isles and Argyll and Bute. Tavish Scott, Lib Dem MSP for Shetland and a former transport minister, described it as "blatant discrimination" against Orkney and Shetland. The previous Labour/Lib Dem Scottish Executive had been preparing plans for 40% reductions for islander before last year's election. But a spokesman for the Scottish Government insisted that the choice of Ret routes was justified. He said: "The unemployment rate in the Western Isles is twice that of Orkney, four times that of Shetland and five times that of Arran. Over the past 20 years, the population of Shetland has remained stable, there has been a slight fall in Orkney's population, Arran's population has increased by 30% yet the population of the Western Isles has fallen by 19%. "The gross value added per capita in the Western Isles is nearly £4000 less than in Shetland So the decision to run the pilot in the Western Isles is based on hard economics. We already support Orkney and Shetland by £28 million per year, up from £22 million in 2007, and have provided an additional £8 million for all services in Scotland over the same period. ==========================
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Post by Low Light Mike on Oct 22, 2008 8:56:10 GMT -8
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Neil
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Post by Neil on Oct 22, 2008 21:41:02 GMT -8
Fascinating stuff. Thanks for posting this, Mr Horn. I'm still reading through some of the components of the report.
This looks like a comprehensive examination of the question of what it should cost for people living in coastal, ferry dependent communities to travel, taking into account prevailing costs of driving, and bus transportation as well. It's interesting to read the various summaries of fares criteria for the Scandinavian nations, where 'political' concerns regarding the welfare of affected communities is a valid concern, and there is none of the nonsensical attitude of, "well, you choose to live on an island, so...".
The report looks at Canadian road equivalent tariff examples- but on the east coast. I guess it's understood that here in BC, there is no such logic to our fares.
We've had so many discussions on this forum of how much people should pay for ferry travel; it's great to see that some places on the planet, there is an effort to take into account the health of coastal communities when setting fares, and there is a process underway to establish a reasonable, ethical criteria for determining transportation costs, looking at a variety of different examples for guidance.
Still more of the report for me to read.
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Post by Low Light Mike on Oct 23, 2008 21:47:57 GMT -8
I'm still doing some mental wrestling with the concept of RET.
If the ferry fare that users pay is based on the crossing-distance compared to the costs of similar distances of roads (which everyone pays for through taxes), then what about the portion of the ferry route that isn't covered by the fare? Wouldn't that too be covered by general taxes?
The ferry users already pay general taxes that fund the roads that that may or may not use. But then the ferry users also need to pay a separate ferry-fare that's based on the road-funding that they're already paying anyways. And everyone's still paying for the fare-shortfall through taxes anyways, whether they use the service or not.
If the roads were also tolled for revenue, then it would make sense to equalize the ratio of tolls-to-costs for both roads and ferries.
The more I think about this, the less I understand re why it's fair (other than it's an objective way to consistently set the ferry fare level).
It doesn't make sense to tie a user-pay ferry-fare to the costs of a taxpayer-funded highway. Apples and oranges?
(Neil, you're the only other one reading this: help!)
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Neil
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Post by Neil on Oct 23, 2008 22:03:12 GMT -8
Too early to be asking me for help on this one, since I haven't read the whole thing yet. We'll have to be confused together for a while. But, hey, you're the accountant....
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Post by Hardy on Oct 24, 2008 2:45:46 GMT -8
I am also reading, but I am having difficulty reconciling it also, and have therefore been silent on it. I am ambivalent right now to the concept -- much like (pure) communism, it 'seems' fair for the teeming masses, but upon closer inspection, something just doesn't add up.
Mark me down as a lurker on this topic.
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Post by Low Light Mike on Oct 24, 2008 7:23:07 GMT -8
Too early to be asking me for help on this one, since I haven't read the whole thing yet. We'll have to be confused together for a while. But, hey, you're the accountant.... I'll be doing some research too, perhaps this weekend. I found lots on the Scotland gov't website about how the RET rates were calculated (re the various assumptions made), but I'm still puzzled re why they use the road-cost-equivalent. - Roads are fully funded by general tax payers. - Ferry costs shortfall (costs, less fares) are also funded by general tax payers. I suppose that I'm assuming that "fair" means that both services would be fully funded by general taxpayers. Oops, that means my thinking is in-line with the "the ferries should be free" crowd. Anyways, I'll see what I can find re this conundrum of mine, and post here for you all to see.
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Post by Hardy on Oct 24, 2008 8:12:59 GMT -8
Simplifying the entire argument a little, and figuring how much everyone pays for what service seems to be the sticking point. It's always a tough sell for someone in a landlocked area far-removed from the actual ferry system to think clearly about subsidizing it in the current taxpayer funded model (ie: the Prince George resident vs the Nanaimo resident).
While the principle of "the greater good" comes into play, and "it benefits the whole province" etc, this has been debated ad nauseum, but the fundamental point remains.
If you take the "per-highway-kilometre" subsidy of highways and secondary routes and apply that to a ferry crossing to figure out actual baseline government FUNDING, at what level do we need to calculate SUBSIDIES to keep the USER-PAY part of the equation in check?
I guess I should take a step back (all this thinking is causing my thought process and writing to not be so clear): I view FERRY FARES to be made up of three components -- a) PUBLIC (Govt) FUNDING: out of general revenue etc (in a "perfect" world, in pure private enterprise, this would be ZERO); b) GOVT SUBSIDY: a function of "OPERATING COSTS" - [(a)+(c)] ... to keep the FARES at a reasonable level for the general population, there can be the need (and IS in the case of our ferry system) for SUBSIDIES; c) USER-PAY: the onus on the individual to pay their own "FAIR" share of FARES for the privilege of being connected and utilizing the ferry system.
So where do you balance all three of these? How do you add it up? This new RET adds some spin to this and makes the equation less clear or more clear depending on your own personal view, but it is certainly grist for the mill.
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Post by Northern Exploration on Oct 24, 2008 10:05:19 GMT -8
My questions and the factors at play are as follows. Some I have answers for, some I have an inkling what I think, and some are undecided.
1. When did ferry service first begin to a location? 2. Did free ferry service ever exist? 3. When people moved to that location was there an understood concept that to live there you needed to pay someone, something to get your goods there and to travel away from the location? Similar to what is starting to be used with aircraft movement - when you moved there was aircraft noise a presumed pre-existing condition you would have been aware of. (all new subdivisions in Mississauga have signs up as you enter a community that aircraft movement effects this area if they are on approach/departure paths). 4. People have moved to the Sunshine Coast or elsewhere with the clear understanding to commute to Vancouver/Victoria etc. necessitates a ferry fare or other commuting charges. How far should they now be subsidized for that? 5. Are people that have had family property that has been handed down from generation to generation paying more proportionately and adjusted for inflation than their forebearers? 6. Despite the past presidence and history when does conditions warrant a new deal or intervention? For example some of the Indian bands with high unemployment and horrendous health care that are impacted even further by higher ferry costs.
I have more but just some of the things I am mulling over.
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Neil
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Post by Neil on Oct 24, 2008 11:58:43 GMT -8
Before we get into the specifics of the RET, it might be worthwhile to look at the basic principles and reasons behind it. I think that some of the issues Northern Exploration has raised are examples of factors that RET tries to get away from.
The report mentions that the motivation of the Scottish government is to revitalize island and coastal communities, promote business, tourism, generate jobs, and generally promote participation by islanders in the social, political, and economic life of the country. It is also noted that the Norwegian government sees an equitable fare structure as essential in retaining population in small coastal communities. The Swedes regard a road as a road, whether it be on land or water, and it's all a part of a national financing structure.
The RET principle is that communities should not have their ability to thrive thwarted by a prohibitively costly ferry system that has as it's aim maximum possible cost recovery. Cost recovery is a factor in RET, but the equivalent cost of a road journey is given higher priority; for instance, the cost of operating a vehicle on an equivalent stretch of road, and, in Norway's case, the cost of driving all around the fjord if the ferry wasn't there.
In British Columbia, it is vastly more expensive, on a mile for mile basis, for people to go to Quadra Island, than it is to go from Tsawwassen to Duke Point, and the island's economy is impacted as a result. RET, from my initial reading of it, seeks to do away with the grab bag of historical, political, business, and cost recovery factors that have governed our ferry rates, and instead implement a system based more on a comparison with communities connected by road. Not exactly a radical idea, if we decide not to be governed by petty jealousies about someone paying for someone else's road, and misconceptions that coastal communities are just retreats for the privileged.
I'm still reading.
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Post by Low Light Mike on Oct 24, 2008 12:22:21 GMT -8
Cost recovery is a factor in RET, but the equivalent cost of a road journey is given higher priority; for instance, the cost of operating a vehicle on an equivalent stretch of road, and, in Norway's case, the cost of driving all around the fjord if the ferry wasn't there. a-ha. I think this is what I was missing in my understanding: - That the RET mimics the cost of driving a vehicle on the road, NOT the cost of building/maintaining that road. Ok, now I've got 2 bags of apples (cost to consumer of driving a vehicle, and cost to consumer of riding a ferry) and 2 bags of oranges (cost to gov't of building/maintaining roads and cost to gov't of building/maintaining ferries). Sorry to hold-up the rest of the class with that mental roadblock.
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Post by Northern Exploration on Oct 24, 2008 13:10:23 GMT -8
A couple of bananas and you have fruit stand. ;D
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Post by Hardy on Oct 24, 2008 13:24:22 GMT -8
While we are looking at the RET (apples), I think that Flugel makes a good point about the 'bag of oranges' too. Pound for pound, we should be looking at all the associated costs before jumping on board with a particular fare/funding structure.
To understand and compare, it is important to know exactly what "ingredients" go into setting the fares in the various methodologies.
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Post by Low Light Mike on Oct 24, 2008 14:03:50 GMT -8
I'll get my biases disclosed now:
- I agree with the result of RET; in that there is a defined, consistent method of determining fares.
- And that this methodology is applied consistently across different routes and regions and applied consistently from year to year.
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Post by Northern Exploration on Oct 24, 2008 14:54:40 GMT -8
I agree with that Flugel as well. Consistency, clarity and fairness are all very important aspects to me. I think where the stickiness comes is with the details. * As well we can't just take examples from other countries and assume they are transferable here without some considerations. The three countries mentioned of Scotland, Norway, and Sweden for example have higher average tax rates than we do here. So you have to take that into account. The VAT rates I believe are also higher and may not be taken into account in the averages I compared. Sweden is substantially higher. The actual percent rates are one thing but you also have to figure in if income is higher. If there is substantially higher income then the simple percentage doesn't account for a larger income per person realized by the government due to the overall higher incomes. You can't just look at what one government can afford and blanket assume it can be applied here. Secondly population densities have to be examined. Norway has a small population of around 5 million with a density of 12 people per square km. Sweden has 9 million with 21 people per square km. Scotland has over 5 million with a density of 64 people per square km. Canada has over 33 million with a population density of 3.61 per square km. Not only that you have to look at overall population breakdown between urban and rural. If you have most of your population spread over a bunch of rural islands the picture is very different over very concentrated urban areas with a small number spread over some rural communities. Urban/Rural breakdowns are interesting enough fairly even spread around the mid 80% give or take. The population of Norway and Sweden is shrinking. I am not sure about Scotland. Canada is growing with a subtantial immigrant increase compared to many countries. So in countries smaller than BC, with a much higher density of population, and notably higher and in one case extremely higher taxes we have a very a somewhat pineapple to grapefruit comparison with Canada (running out of fruit ). So if you limit the discussion to BC compared to these countries, you are now looking at provincial taxes paying something a federal body is paying for in the other instances. These smaller countries have fewer roads, going shorter distances, with a population that uses transit more than us, and that isn't nearly as mobile as Canadians. All of that long windedness is to say that while RET may be a great way for those countries to foster connectivity and support of outlying communities, the whole picture has to be looked at and compared in order to determine if it is indeed possible elsewhere.
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Neil
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Post by Neil on Oct 24, 2008 21:57:45 GMT -8
It's not so much a matter of what a government can afford; it's more a matter of what a society chooses to afford. Yes, Swedish taxes are much higher than here. They also have free local ferries, free university education, paid 18 month maternity leave for every child, and other benefits that must be taken into account when determining their true cost of living. Neither Scotland or Norway have the bulk of their population living in small towns, or "spread over a bunch of rural islands". They have a similar urban population percentage to ours, similar standard of living, and a similar situation with many small islands with small populations, within short ferry rides from the mainland. The applicability of an RET model would seem to be as valid here as in Europe. Newfoundland, which has seen so much harm done to its small coastal communities by the contraction of the fishing industry, has implemented an RET fare structure. No one would suggest that they are a wealthy society, brimming with excess dollars to lavish on a 'cadillac' ferry system. They've made a decision about the health of their coastal communities, similar to what Scotland is pursuing, and lower ferry fares are seen as an investment. More information here: www.willthomasonline.net/willthomasonline/Fairer_Ferry_Fares.html
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Post by Northern Exploration on Oct 25, 2008 11:48:24 GMT -8
The population "spread over a bunch of small islands" was illustrative of the point I was making and I wasn't equating it to any of the countries mentioned. I used it particularly to see if it it would end up as a media type sound bite . Still missing from your comparisons is how much money those countries spend on infrastructure compared to what is necessary in Canada. And in this case comparing roads. The network of roads is much different than is necessary with BC. So if they are spending much less money on roads, then than those funds can be spent elsewhere. Norway has 50 some oil fields in the North Sea in production and Scotland is the EU's largest petroleum producing country, both more akin to Alberta. One cannot ignore that massive injection of income into those economies and the funds it makes available to the governments for some of the things you have mentioned. Newfoundland with over 55% of their population in rural and outpost communities and the relative historic abject poverty those communities have faced, is not a good comparison with BC. And while the fishing industry is still in crisis, the oil revenues from Hibernia and the other three oil fields have already changed the economic outlook of the province dramatically. Danny, when he isn't giving Harper a hard time, loves to brag that Newfoundland is open to sending transfer payments to Ontario. Beyond just bravado I think it is indeed a recognition of the help that the rest of Canada has been to the economy there. Again I am not yet ready to say I would be for or against RET. The money has to come from somewhere and the idea is worth exploring. But when looking at it, we have to be realistic and look at the complete picture and back to the fruit analogy compare coconuts with the equivalent to coconuts not with mangos . We can't just "cherry" pick ideas that suit what we want to happen without all the facts in play.
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Post by Low Light Mike on Oct 25, 2008 13:14:33 GMT -8
Here's a quote from that website that Neil linked, re 2 ways to determine a RET, which I found very helpful in understanding that there are 2 different ways in which RET could be worked:
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Post by kerryssi on Oct 26, 2008 9:53:02 GMT -8
To my recollection when the ferry system was first started it was funded by a formula based on equivalent costs for a road of the same distance. That is what the subsidy was based on. Any extra cost above that was collected in fares. That formula has been lost over time and we now have a straight subsidy...actualy two subsidies, one provincial and one federal. The inland ferries were considered part of the highway system and therefore was entirely subsidized ( no fare ). Part of the problem is Campbells insistence on using the ferry system as a whipping boy to distract people from the enormous costs of the Convention Center and the Whistler highway. If the ferry subsidy were based on the equivalent cost of the Whistler highway then I think every passenger might be paid to travel on the ferry
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Neil
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Post by Neil on Oct 27, 2008 22:06:04 GMT -8
To my recollection when the ferry system was first started it was funded by a formula based on equivalent costs for a road of the same distance. That is what the subsidy was based on. Any extra cost above that was collected in fares. That formula has been lost over time and we now have a straight subsidy...actualy two subsidies, one provincial and one federal. Let's not give old Bennett more credit than he deserves. On the main routes, BC Ferries simply adopted the CPR Nanaimo fares, which were $5 for a car, $2 per passenger. It was also cheaper to go to Fulford from Swartz Bay than from Horseshoe Bay to Bowen, despite Bowen being a shorter route. It doesn't seem that fares were based on any formula. The population "spread over a bunch of small islands" was illustrative of the point I was making and I wasn't equating it to any of the countries mentioned. I used it particularly to see if it it would end up as a media type sound bite . Perhaps you should 'flag' the parts of your posts that are just there for, umm, effect.... to differentiate them from the really important stuff. Still missing from your comparisons is how much money those countries spend on infrastructure compared to what is necessary in Canada. And in this case comparing roads. The network of roads is much different than is necessary with BC. So if they are spending much less money on roads, then than those funds can be spent elsewhere. Norway has 50 some oil fields in the North Sea in production and Scotland is the EU's largest petroleum producing country, both more akin to Alberta. One cannot ignore that massive injection of income into those economies and the funds it makes available to the governments for some of the things you have mentioned. Norway introduced their heavily subsidized fares structure in 1964, before oil was a factor in their economy. When you look at the northern European nations, you see economies with oil, ones without, flat easily connected island nations like Denmark, Norway with it's difficult, expensive to engineer topography, and also countries with different prevailing political mindsets. A similarity between a number of disparate nations is a commitment to heavily subsidized or free ferry service, some based on the RET or modified RET formula. I have to disagree that it's geography or economic base that might make us less able to adopt a similar pricing philosophy. It's a matter of priorities and what we feel is important regarding small, vulnerable communities. Here in Canada, we don't seem to have any prevailing mindset on ferry pricing. Nova Scotia recoups 15% of operation costs in fares; here in BC, it's 80%. Most provinces have free crossings of rivers and lakes, as do we. A family of four in their car can cross Kootenay Lake for free, but a journey of similar length on a similar sized ferry to Fulford Harbour will cost them $56. Am I 'cherry picking' facts and examples? I think I'm just trying to show that it is priorities, and/or political philosophy, that determines our fares, and not some sort of economic imperative. Putting all this aside, NE, I'd be interested in your thoughts on the formula that's laid out in the Scottish report.
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Post by Hardy on Oct 27, 2008 23:35:34 GMT -8
Nova Scotia recoups 15% of operation costs in fares; here in BC, it's 80%. Most provinces have free crossings of rivers and lakes, as do we. A family of four in their car can cross Kootenay Lake for free, but a journey of similar length on a similar sized ferry to Fulford Harbour will cost them $56. Am I 'cherry picking' facts and examples? I think I'm just trying to show that it is priorities, and/or political philosophy, that determines our fares, and not some sort of economic imperative. And right there, Neil, in 5 (or so sentences) you have summed it up very neatly and concisely. Heck, I think you even managed to tie and furl the fancy bow-tie on it at the same time! It is all about political will and consequences. We _could_ finance coastal ferry crossings at up to 100%, but where would the political gain be? Your inland ferry example of vessel and crossing is insanely ideal -- as it presents the paradox of the operation at a level that cannot be argued -- what is the difference, other than a political riding? Moreover, there IS an alternate route for those riding the Kootenay Lake crossing - a drive-around route, although it would take a considerable amount of time. No such alternate exists to "drive-around" Fulford.... Hmmm. Yes, quite the example of hitting the nail on the head Neil. Well done!
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Post by Northern Exploration on Oct 28, 2008 9:26:12 GMT -8
I am brewing on the Scottish report still. The questions I am thinking through are the ones I have put here previously among others as well. I don't know that NS is a fair comparison. Which ferries are you refering to? The Northumberland or the CAT? The CAT is on the verge of bankruptcy and just received a million dollar injection from the government to keep it operating. It isn't necessary transportation and just an economic link and a political decision for Yarmouth and NS tourism as a whole not for local transportation. A lot of people from Maine travel on to Halifax from the ferry. That would be the similar for the BC government giving the Coho some cash to keep running and bringing US Tourists to Victoria. The Northumberland ferries are not as vital to transportation either but more of an economic decision. The political background on this is to keep more people from traveling to NS rather than across the bridge to NB. People there don't need the ferry as their only link. But it is the NS governments attempt to keep tourist and local money flowing their way versus exclusively through NB and the Confederation Bridge. It has an impact far beyond the local community. In the case of NS more of a competitiveness move and one that impacts the whole province rather than just local communinities. I am on record as saying I think that the ferries to the small communities in BC need to be maintained and affordable. But I am also of the opinion that the communities need to do much more themselves, for which I get a very strong reaction with words such as reasonable - translated into rampant. The recent cooperative housing for low income individuals is one example that needs to be replicated. I look at the picture holisticly and the ferry fares are only one area of impact on the islands. One can't just point to ferry fares and hang all the blame there as much as they are a contributing factor. You have to chip away one area at a time but I think the whole economic and social situation of the Islands needs to be re-examined including the Islands trust. I know the can of worms that opens and the low chance of any concensus there would be. As I mull over the Scottish report further, I know I will have more questions to think through and issues to deal with. It could be that a modified modified RET is where I will come out though .
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D'Elete BC in NJ
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Post by D'Elete BC in NJ on Oct 28, 2008 10:54:25 GMT -8
...I look at the picture holisticly and the ferry fares are only one area of impact on the islands... Though I know many people of the islands like to picture things holisticly, many just as a way of life, others with a little additional help ;D, I think remembering to step outside and look at the whole situation or the "big picture" sometimes gets misplaced, or misspelled . Our tendencies to focus on the smaller details we can directly relate to sometimes blinds us...we go "micro" when we need to go "macro". NE is right in stating the issues of ferry fares are just the tip of the iceberg, though they do tend to highlight the problems surrounding island living. This is not an isolated concern particular to the BC coast; there are many other communities that have collapsed because the infrastructure need to keep them alive was either not available, or they just became economically nonviable. I hope this doesn't happen to the Island communities in BC. There is likely no "magic bullet" to slay the dragon and solve the issues, but hopefully, and I've said this many times before, the communities in question will look to themselves for solutions as much as to the government. In my opinion, getting help from the government is only good for as long as the government wants to help...a self reliant community is good for as long as its members work to keep it that way. I have yet to break into the RET paperwork either, but once I do, I'll pose my thoughts and questions on that subject!
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D'Elete BC in NJ
Voyager
Dispensing gallons of useless information daily...
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Post by D'Elete BC in NJ on Oct 29, 2008 6:24:08 GMT -8
I have yet to break into the RET paperwork either, but once I do, I'll pose my thoughts and questions on that subject! Alright, having read enough of the report to get a "feel" for the cost factors that could be used to formulate a RET, I have questions. A brief (or not so) synopsis of my understanding of the conclusions of the report: the proposed Scottish system assumes a base rate for terminal and ship maintenance and then adds a predetermined per mile rate for each route. These costs are fixed for the entire system and do not factor in local anomalies or additional costs for a particular route. Commercial vehicles pay a higher base rate which doesn't seem to be based on an AEQ, but the per mile rate does. Passengers also pay a base rate that isn't based on a AEQ, and the per mile rate is more in tune with the cost per mile cost of a bus or train than a car. None of these fares seem to take in to account the underlying infrastructure construction costs of either the road system or the ferry system. So, based on this understanding of the proposed Scottish system, I'll get on to the questions I have about implementing such a system for BCFS. What cost factors do we consider appropriate for the calculation of a RET? Do we look at just the cost of ownership and fuel for a theoretical automobile traversing an imaginary equivalent road? I.e. do we count only the car costs, the maintenance, the insurance, etc, similar to what is calculated into your business mileage allowance on your taxes , or cost of ownership? ;D I don't even want to get into how to calculate these costs...too many pitfalls there! Back to the questions...is there more to calculating an RET than just these costs? I know this idea was left out of many if not all of the RET calculations, but it is a factor I consider worthy of investigation. Going back to Flug's comments about tax-funded roads and unfunded ferries, with tales of the tolled and the untolled (lol, he put it more succinctly and eloquently ), how do we rectify the base funding level differences for construction and maintenance of the infrastructure? Do we include the theoretical cost of constructing the road, related infrastructure and subsequent maintenance? If so, do we balance this with the construction cost of the ship, terminal, and their operating costs? What I'm looking at here is how do we calculate the difference in costs between building and maintaining a road link as opposed to ship base transportation. In some cases, i.e. linking Vancouver Island to the mainland, it is probably more cost effective to maintain a ship based link as opposed to building and maintaining a bridge link (no comment on the feasibility of the bridge connection ). My feeling is a similar comparison would be possible for all the Gulf Islands. Then the question becomes should fares reflect the cost increase or savings for the use of a ferry vs. a fixed link on a lifetime expenditure vs. lifetime expenditure basis? One other thing that I'm wondering about: do you calculate the equivalency as though it were a direct A to B road route, or do you take into account any existing alternative road routes even though they may be significantly longer? There are several routes in the BCFS system that could fall under this umbrella. As an aside, I did a quick comparison of the Cape May-Lewes fares to analyze this, and here's what I came up with. The fare for a one way trip for car and driver is $24. A quick calculation of taking the alternate route of 167 miles costs $17.70 (gas and tolls only for my car ). A RET based on the alternate route using a rate of $0.502 per mile (going tax deduction rate) gives a cost of $83.83. A RET based on the direct route using the same cost per mile gives a cost of $11.56 (in reality $15.56, because the bridge toll should be included as well). So the alternate route should cost $87.83 with the toll added. Heh heh I'm not going to include the additional hour and a half I want to be compensated for if I have to drive the long way round! I think this factors into the length of journey rates in lieu/addition of RETs used by some of the countries investigated, but I'm not entirely sure. I would think, in all fairness, if the fuel cost of using a ship based route was less than the cost of driving the long way around, you should see a savings reflected in the RET. Alright, now a quick look at commercial vehicles. How do we fairly calculate their fares? Do we use a separate cost of ownership model similar to the passenger car, or do we simply convert the RET for a passenger car using an AEQ formula? (Hardy could give us a realistic cost of ownership per mile traveled, and Flug can supply the commercial tax credit per mile traveled...if it is different from the allowance for a car...and we could effectively compare the two methods of arriving at rates once all the model parameters are established.) Changing focus once again, how do you calculate the foot/additional passenger RET? It can't be the same fare as a car, obviously, but what do you use as an alternative cost of ownership/travel? Do you use the costs associated per passenger for a bus? Or do you assume that a typical car will hold X passengers and divide the car RET by X? One final comment/question regarding RETs; many of the ferry services investigated have instituted a discount for service to economically depressed/fragile/sensitive communities. I'm not entirely sure how to approach this to calculate some form of fare correction; I have some ideas on the matter, but haven't thought them out enough to pose questions.
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