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Jack Knox: The refitting of B.C. Ferries

The corporation faces tough choices, and so does the provincial government

Admit it: B.C. Ferries’ newer boats are pretty spiffy.

In the past six years, the government-owned, sort-of-independent company has added seven ships.

That includes five big ones: the German-built Coastal Celebration, Coastal Inspiration and Coastal Renaissance and, way up the coast, the Northern Adventure and Northern Expedition.

Long gone are the Queen of Asbestos class of vessels, the kind where passengers would climb a too-narrow stairwell from the car decks, only to emerge into what appeared to be a 1960s bus depot, mysterious grey stuff hanging from the ceilings.

Not everyone likes to see well-appointed ferries. Some mutter about the cost of building “cruise ships” instead of Spartan commuter barges.

But at B.C. Ferries, they’ll tell you those criticisms are off the mark, that the cost of adding comfy chairs and wall-mounted televisions is relatively insignificant. The big money is in the propulsion system and other below-decks costs.

As for “frills” like the restaurants and gift shops, they make a tidy profit, pulling in $75 million a year — close to 10 per cent of Ferries’ total revenue. Besides, the people who work in them have to be there whether or not they’re flipping Triple O burgers or selling magazines. On-board staffing levels are dictated by federal transportation safety rules.

Likewise, the corporation has little say in where or how often its ships sail; that’s all laid out in its contract with the provincial government. Not much it can do about fuel prices, either.

The result is that the great bulk of B.C. Ferries’ costs are beyond its control.

Meanwhile, it operates with a level of government subsidy far lower than that of comparable ferry systems, with the province stubbornly pushing B.C. Ferries toward a user-pay model even as critics scream that rising fares are pushing ridership — and therefore revenue — down.

As it wriggles away in this straitjacket, more financial pressures are coming. The big ships on the major routes have been replaced, but many of those on the intermediate and minor runs have passed their best-before date.

“Our minor fleet is 35 years old, on average,” says B.C. Ferries CEO Mike Corrigan. “That’s an old ferry fleet.”

The question then, as the corporation heads into Phase Two of its fleet-renewal program, is how they’re going to pay for it all.

Having spent $1.9 billion on capital projects (ships, docks, terminals and the like) in the last decade, the corporation is already carrying $1.4 billion in debt. It needs to reduce spending — which means cutting service — or increase revenue, either via a higher subsidy or more money from customers.

The math isn’t hard, just hard to swallow. “If people don’t want their service reduced and government doesn’t want to reduce service, and government doesn’t want to put more money into the system, then fares have to go up,” Corrigan says.

Building new ships isn’t cheap. “The biggest challenge to constraining fare increases in the B.C. Ferry system is the huge increase in capital spending that is forecast over [the next dozen years],” noted the B.C. Ferry Commission’s 2012 review of the province’s Coastal Ferry Act.

In fact, capital costs are roughly equal to the federal and provincial subsidies, which make up about a quarter of the overall budget.

The ferry commission’s review estimated it would cost $2.5 billion over the next dozen years to upgrade terminals and build new ships similar to those being retired.

The corporation thinks it can do so more cheaply by building a single model of mid-sized ferry for use on its intermediate routes. Having six to eight similar vessels would cut design costs, allow ships to be moved from route to route and provide other savings associated with standardization. It’s the same reason airlines like to fly only a few types of planes.

As it is, 17 classes of vessels are represented in B.C. Ferries’ 35-ship fleet. Many simply don’t match the demand on the routes they sail. “We want to get down to four or five classes,” Corrigan says.

The commission has given the corporation approval to build the first three intermediate-sized ships. Two 145-car, 600-passenger vessels will replace the aging 192-car Queen of Burnaby on the Comox-Powell River run and the same-sized Queen of Nanaimo on the Tsawwassen-Southern Gulf Islands route. The third will be added to the latter service in busier times. The first two ships are due in 2016, the third in 2017.

“We’re building ships that we think are the right size going into the future,” Corrigan says.

B.C. Ferries also hopes liquefied natural gas could cut its fuel spending, which currently makes up a fifth of its operating budget. “That could be a major game-changer for us,” Corrigan says. If projections hold true, LNG would be 50 to 60 per cent cheaper than diesel, but conversion costs would be massive.

The truth, though, is that no matter how much costs are cut, some routes will never be self-sufficient. In fact, the corporation says 22 of 25 routes — all except the major runs from Vancouver Island — will always need subsidies. The long, northern routes bleed red.

That reality can’t be reconciled with the government’s user-pay philosophy, not unless the Liberals want to follow Newfoundland’s lead and depopulate our coastal communities, says North Island MLA Clare Trevena, the New Democrats’ ferries critic.

Trevena wants the government to share W.A.C. Bennett’s original vision of B.C. Ferries as an integral part of our economic infrastructure. “The view used to be that ferries were extremely necessary for the economic good of our province.

“The government has really abdicated responsibility,” she says. “There is really no vision for B.C. Ferries from the government.”

That sentiment was echoed in the ferry commission’s review of the Coastal Ferry Act: “There does not appear to be a long-term vision for coastal ferry services nor any forecast of long-term demand.”

Trevena calls the current model a “failed experiment.”

It wasn’t exactly smooth sailing when the corporation was more directly under government control, though. Back then, capital-spending decisions were largely political, with B.C. Ferries fighting for elbow room at the funding table with everyone else in the public sector.

“We had to line up behind universities, schools and hospitals, and you don’t win that battle,” Corrigan says.

Remember that before the Liberals cut the corporation loose, they wrote off $1.1 billion in debt, including half a billion from the NDP’s fast-ferries fiasco. “If it was a private company, it would have been declared bankrupt,” Corrigan says.


Here's a look at all 35 vessels in the fleet and where they are in their lives:

• COASTAL RENAISSANCE - Built: 2007. Capacity: 370 cars (including 32 semis), 1,604 people. First of the German-built Super-C Class ferries sails between Swartz Bay and Tsawwassen in the winter and Departure Bay and Horseshoe Bay in the summer.

• COASTAL INSPIRATION - Built: 2008. Capacity: 370 cars (including 32 semis), 1,604 people. Travels from Duke Point to Tsawwassen.

• COASTAL CELEBRATION - Built: 2008. Capacity: 370 cars (including 32 semis), 1,604 people. Plies the Swartz Bay-Tsawwassen run.

• NORTHERN ADVENTURE - Built: 2004. Capacity: 101 cars, 640 people. Originally the MV Sonia, Greek-built ferry operated in Spain and Caribbean before being purchased by B.C. Ferries after the sinking of the Queen of the North in 2006. Sails between Port Hardy, Prince Rupert and Haida Gwaii during the winter and Prince Rupert to Haida Gwaii in the summer.

• NORTHERN EXPEDITION - Built: 2009. Capacity: 130 cars, 638 people. Also built in Flensburg, Germany, it sails the Inside Passage between Port Hardy and Prince Rupert in the summer and also on the sailings between Prince Rupert, Port Hardy and Haida Gwaii the remainder of the year.

• ISLAND SKY - Built in North Vancouver and Esquimalt in 2008. Capacity: 125 cars, 462 people. Replaced the Queen of Tsawwassen on the Earls Cove-Saltery Bay run on the Sechelt Peninsula in 2009.

• KUPER - Built: 1985. Capacity: 32 cars, 269 people. Originally the MV John Atlantic Burr, boat was cut into sections, trucked and barged up from Lake Powell, Utah, rebuilt, widened and elongated in 2006 before being put to work on the Chemainus-Thetis-Penelakut Island run. Considered a good buy because freshwater ferries don't rust as quickly (and Utah fresh water ferries don't seem to rust at all).

• SPIRIT OF BRITISH COLUMBIA - Built: 1993. Capacity: 410 cars (including 34 semis), 2,100 people. One of two biggest ships in fleet is due for mid-life upgrade in 2017 and 2018. Sails between Swartz Bay and Tsawwassen.

• SPIRIT OF VANCOUVER ISLAND - Built: 1994. Capacity: 410 cars (including 34 semis), 2,100 people. One of two biggest ships in fleet is due for mid-life upgrade in 2016 and 2017. Sails between Swartz Bay and Tsawwassen.

• BOWEN QUEEN - Built in 1965, 70-car, 400 passenger open-deck vessel augments Southern Gulf Islands - Salt Spring Island - Tsawwassen run in the July and August and serves as a relief ship the remainder of the year. When the new vessel class is built the ship will be available to provide refit relieve year-round.

• MAYNE QUEEN - Built in 1965, 70-car 400 passenger open-deck ferry serves goes between Swartz Bay and outer Gulf Islands.

• POWELL RIVER QUEEN - Built in 1965, 68-car 400 passenger vessel shuttles between Campbell River and Quadra Island.

• HOWE SOUND QUEEN - Built: 1964. Capacity: 70 cars, 300 people. Ferries' only Canadian-made ship built outside B.C., it was called Napoleon L before coming from Quebec in 1971. Sails between Crofton and Vesuvius on Saltspring Island.

• KAHLOKE - Built: 1973. Capacity: 30 cars, 200 people. Does the 10-minute crossing between Hornby and Denman islands.

• KLITSA - Built: 1972. Capacity: 22 cars, 150 people. It's the Little Ferry That Could, carrying Malahat-weary travellers between Mill Bay and Brentwood Bay.

• KWUNA - Built: 1975. Capacity: 26 cars, 150 people. Goes between Moresby and Graham islands in Haida Gwaii. Three-quarter life upgrade scheduled for Point Hope Shipyard this fall.

• QUINITSA - Built: 1977. Capacity: 50 cars, 300 people. Is due to be replaced on the run between Denman Island and Buckley Bay, south of Courtenay by a cable ferry (cue local outrage). Received mid-life upgrade in 2008.

• TACHEK - Built: 1969. Capacity: 30-cars, 150 people. Currently getting a life extension refit at Point Hope Maritime Shipyard that will push its retirement date to 2029. It was used as a relief ship but is slated to take over the Quadra to Cortes Island route.

• TENAKA - Built: 1964. Capacity: 30 cars, 100 people. Formerly the Comox Queen, single-ended vessel sails between Quadra and Cortes islands. Will be used as a relief ship after being replaced on that route by the Tachek.

• QUADRA QUEEN II - Built: 1969. Capacity: 30 cars, 150 people. Follows the Port McNeill-Sointula-Alert Bay triangle. Refit finished in 2011 was meant to prepare boat for another 20 years of life.

• QUEEN OF BURNABY - Built: 1965. Capacity: can carry 192 cars with all hoistable ramps deployed, but often not utilized to make room for commercial vehicles, 897 people. Due to be retired from Comox-Powell River route after new vessels arrive in 2016.

• QUEEN OF NANAIMO - Built: 1964. Capacity: 192 cars, 996 people. Due to be retired from Tsawwassen-Southern Gulf Islands run after new vessels are launched in 2016.

• QUEEN OF ALBERNI - Built: 1976. Capacity: 290 cars (including 24 semis), 1,193 people. Sails Duke Point to Tsawwassen. Refit in 2007 was meant to prepare ship for another 20 years of life.

• QUEEN OF CAPILANO - Built: 1991. Capacity: 85 cars, 451 people. Travels between Horseshoe Bay and Bowen Island. Vessel to undergo mid-life upgrade in 2015.

• QUEEN OF COQUITLAM - Built: 1976. Capacity: 360 cars (including 12 semis), 1,488 people. Horseshoe Bay-Departure Bay, Horseshoe Bay-Langdale. Refit in 2003 was meant to extend life 20 years.

• QUEEN OF CUMBERLAND - Built: 1992. Capacity: 127 cars, 456 people. On Swartz Bay-Southern Gulf Islands routes. Vessel to undergo mid-life upgrade in 2016.

• QUEEN OF CHILLIWACK - Built: 1978. Capacity: 115 cars, 389 people. Norwegian-built ship sails Discovery Coast Passage (Port Hardy, Ocean Falls, Bella Bella, Bella Coola, Shearwater, Klemtu) in summer, does relief duty in winter.

• QUEEN OF COWICHAN - Built: 1976 Capacity: 360 cars (including 12 semis), 1,488 people. Departure Bay-Horseshoe Bay. Mid-life upgrade in 2004.

• QUEEN OF OAK BAY - Built: 1981. Capacity: 360 cars (including 12 semis), 1,488 people. Sails Horseshoe Bay-Departure Bay. Mid-life upgrade in 2005 was meant to prepare ship for another 20 years of life.

• QUEEN OF NEW WESTMINSTER - Built 1964: Capacity: 270 cars, 1,325 people. Sails Tsawwassen to Swartz Bay. Major refit completed in 2009 was meant to add 10 to 15 years of service.

• QUEEN OF SURREY - Built 1981: Capacity: 360 cars (including 12 semis), 1,488 people. Horseshoe bay to Langdale. Mid-life upgrade in 2006 was meant to prepare ship for another 20 years of life.

• QUINSAM - Built: 1982. Capacity: 70 cars, 400 people. Does the run between Nanaimo and Gabriola, where residents have, at times, pondered the idea of replacing the ferry with a bridge. Had mid-life refit in 2010.

• NORTH ISLAND PRINCESS - Built: 1958, the year Ford made the Edsel. Capacity: 49 cars, 150 people. Sails between Powell River and Texada Island.

• NIMPKISH - Built: 1973. Capacity: 16 cars, 125 people. Tiniest boat in the fleet is used in the winter to connect the mid-coast communities of Bella Bella, Shearwater, Ocean Falls and Bella Coola, to the northern route ship sailing between Prince Rupert and Port Hardy.

• SKEENA QUEEN - Built: 1997, Capacity: 100 cars, 450 people. Sails between Swartz Bay and Fulford Harbour on Salt Spring Island. To undergo mid life refit in 2017.

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