SSA officials discuss cost of service

Analysis of the Steamship Authority (SSA) rate structure, prepared by boatline management, shows that the cost of service on the Martha’s Vineyard routes decreased by $62,244, or 0.1 percent from 2010 to 2011. Excursion fares for Vineyarders are subsidized by other fare categories by more than 60 percent of the allocated costs.

Nantucket service costs increased by $194,541. The subsidy for Nantucket excursion fares was nearly as high.

SSA treasurer Bob Davis presented the cost report at the members’ monthly business meeting on May 15 in Hyannis.

SSA rates are based on the cost of service allocated to each route and category of use. Higher fuel costs and lower maintenance costs accounted for changes in operating costs, according to the monthly report.

In his analysis, Mr. Davis described the degree to which standard-fare vehicles subsidize the excursion rates charged Vineyard year-round residents. He described the cost to transport vehicles by category and revenue on the Vineyard route.

“The estimated cost of a car-equivalent unit space was $49.05 in 2011. On average, automobiles covered 94.6 percent of their allocated cost of service, with standard fare automobiles covering 129.7 percent and excursion fare automobiles covering 38.5 percent. By comparison, on average, trucks were covering 110 percent of their allocated cost of service.”

By comparison, standard-fare vehicles on the Nantucket route covered 161.9 percent and excursion fare autos covered 41 percent. The estimated cost of a car equivalent space was $119.67, more than twice the estimated cost for the Vineyard route.

In other news, director of engineering and maintenance Carl Walker spoke of changes to the SSA’s parking lot on Palmer Avenue, in Falmouth, which are now expected to come at a significantly higher cost.

Originally, the project, which would demolish the ice arena on Skating Lane, was estimated to cost $425,000, though now Mr. Walker said the cost has risen to $1,500,000. The increase is due to a decision to pave the area and provide for drainage.

The SSA voted to delay construction until late 2012 or early 2013.