The Steamship Authority’s preliminary budget for 2014 anticipates operating expenses at $85.3 million, up .6 percent, or $497,000, from the current year’s estimated total. This year’s estimate, based on seven months of actual expenses and five months as budgeted, includes $2.08 million in unplanned spending on post-Sandy repairs to the Oak Bluffs terminal.
Boatline treasurer and comptroller Bob Davis gave the members and a look at the draft spending plan at a meeting Tuesday at Nantucket. The 2014 budget will be decided by the members at their meeting next month.
The draft spending plan includes anticipated increases of 4.7 percent for vessel fuel, 2.8 percent for health care, a jump of 5.6 percent pension benefits, and a 10.5 percent decrease in maintenance expense. 2014 revenue is estimated at $89 million, a .9 percent increase.
Comparing anticipated spending and anticipated revenues, Mr. Davis estimates the SSA will need an additional $1 million of revenues from anticipated rate increases, all of it to come from Vineyard rates.
“Mr. Davis observed,” according to the SSA memorandum on discussions at Tuesday’s meeting, “that assessing all of the rate increases for 2014 on the Martha’s Vineyard route is attributable to the increased cost of service for that route and, after implementation of the proposed rate increases, 57.1 percent of the SSA’s total revenues are projected to be derived from that route, while that route’s cost of service is projected to account for 57.2% of the SSA’s total operating expenses.
“Specifically, SSA management is proposing to raise the additional $1million in revenue by increasing freight rates for trucks over 20 feet in length by 5.25 percent (which is projected to raise $400,000 in additional revenues) and increasing both the daily parking rates in Woods Hole/Falmouth and the annual cost of Woods Hole/Falmouth parking permits (which are projected to raise $600,000 in additional revenues). SSA management is not proposing any increase in passenger fares, automobile fares, or excursion fares, and this would be the first increase in freight rates for trucks over 20 feet in length on the Martha’s Vineyard route since 2007.”
In other business, the SSA has asked design firms with naval architects to describe their qualifications for a design contract for the new vehicle/passenger ferry the line will build to replace the Governor. The design contract will be let in December. The boatline has set preliminary specifications for the vessel, including a capacity of 512, including passengers and crew.
“This passenger capacity should be adequate to meet the SSA’s demand in almost all cases (and certainly better than the M/V Governor’s passenger capacity), as the SSA carried 500 or more passengers on fewer than 2.5 percent of its trips between Woods Hole and Martha’s Vineyard in 2012,” the SSA meeting memo reported.
In other business, members reviewed 2014 summer and fall operating schedules, which envision significant changes to Nantucket service, but Vineyard service will be essentially the same as it has been this year.