Ferry prices are expected to rise over the next half decade, and the BC Ferries commissioner has just announced his preliminary decision on price caps for the next performance term.
Beginning April 1, 2020, fares can increase by a maximum of 2.3% every year until March 31, 2024.
The proposed price cap was set to contend with predicted operating expenses, which BC Ferries says will increase at, or slightly above, Canada’s rate of inflation.
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The commissioner created a thorough report describing his reasoning for the preliminary price cap. Some of the highlights include:
- In fiscal 2018, BC Ferries delivered 79,082 round trips, exceeding the minimum amount of required trips under the Coastal Ferry Services contract by 2,962.
- BC Ferries implemented average fare increases that were lower than the 1.9% it was allowed for performance term four.
- Vehicle traffic increased by 2.9% and passenger traffic increased by 1.7% compared to fiscal year 2017, breaking the previous 2008 record. The trend continued through 2018 and is expected to climb further in 2019 and 2020.
- Long-term capital plans will have a moderate impact on performance term five price caps but could have a larger impact for following terms.
- Non-controllable costs in the upcoming performance term include $19.8 million for the provincial carbon tax, $6.1 million for the new provincial health tax, and $19.4 for Canada Pension Plan rates.
Besides the proposed preliminary price cap, the commissioner also offered several recommendations.
First and foremost, he advises BC Ferries to develop a plan for a full conversion into all-electric ferries as soon as infrastructure and technology makes it possible.
He also suggests reducing long-term capital plans to ease pressure on future price caps and to develop a tracking process and reporting requirements to keep on top of reducing operating, maintenance, and administration costs.
“I am pleased to see the price caps tracking close to the consumer price index for British Columbia,” said Sheldon Stoilen, BC Ferries commissioner in a statement.
“The major challenges to operating a world-class system that is affordable to the riding public and taxpayers can be expected to persist and even deepen. The commissioner will applaud any effort by BC Ferries and the Province to address the Redlin report recommendation for a jointly developed vision to address them.”
The commissioner has until September to finalize the fare increase, allowing for a period of public input and review by the provincial government and BC Ferries.
Residents have until June 30 to send their comments to the commissioner online at [email protected] or the Office of the BC Ferry Commissioner, P.O. Box 9279, Victoria, BC, V8W 9J7.