August 27, 2015 (Transportation Task Force)

Transportation Task Force
Meeting Notes
August 20, 2015
Held at the Islesford Neighborhood House on LCI at 4:00 P.M.

Meeting called to order at 4:10 P.M. (Islesford Library, INH):

Members Present: Ron Axelrod, Cory Duggan, Paul Thormann, Skip Stevens;
(By Teleconference): Sam Donald, Ingrid Gaither, Chris White;

Others Present: Jim Fortune, Charlie Norris, Florence Sprague, Malcolm Fernald;

Public Attendance: A number of people from the public attended the meeting. Ron Axelrod explained the purpose and mission of the Transportation Task Force. The purpose is to develop a structure for ferry service for the islands after the current ones are gone (i.e., no longer in operation). With the help of a water transportation consultant the Transportation Task Force has developed operational and service models and specifications that can be implemented with a new ferry service.

While the Action Plan was being developed, Beal and Bunker notified Selectmen Richard Beal that they won’t be able to continue with a winter ferry service this year.

Due to the possible pending sale of Beal and Bunker and uncertainty about ferry service after mid-October, the Transportation Task Force will now need to develop a transition plan that will move the Town towards an Action Plan to be implemented next year. The Town may need to purchase or lease boats and purchase/secure contracts for this transition, and then issue a Request for Proposals for a ferry service next summer.

Ron Axelrod Reviewed the agenda for the meeting:
1. Ferry Service Implementation Timeline, dated 8/13/2015 (See Attachment A)
2. General status Update and Comments
3. Transition Plan Memo Draft #2, dated 8/17/2015(See Attachment B)
4. Workshop Agenda – (Scheduled for Saturday, August 29, 2015) (See Attachment C)
5.Other Upcoming Meetings for the TTF:
-Regular TTF Meeting (Thursday, August 27 – LCI)
-Public Workshop (Aug 29, 2015) – LCI
-NEH Harbor Committee Meeting (September 8, 2015)
-TTF Meeting (September 4, 2015)

Questions from the public about Beal and Bunker:
-Why are they going out of business
-Are they profitable
-Who will be responsible for maintenance and equipment if the Town purchasess the business
-Is there anyone else who would like to take over the business

The Action Plan is still being developed. The Transportation Task Force expects to have the transition plan and Action Plan ready for the Selectmen by November 1st.

The Task Force noted that the Chebeague Island ferry and Isle au Haute ferry have a non-profit ferry business. The ferry businesses that had been serving these islands went up for sale; when no buyers were found, the non-profits were formed. Both Chebeague and Isles au Haute needed to purchase new vessels at that time, which will be the case with Beal & Bunker. Beal and Bunker is similar to the Chebeague and Isle au Haut cases. It appears that the interim vessels that could be purchased/leased from Beal and Bunker would not be viable or counted on as primary vessels long-term.
Therefore, purchasing new vessels will be the most important part of the Action Plan. How long the boat(s) used during the transition period can be used will also be important. The Town will need a professional marine survey of the 2 vessels (Sea Queen & Cap’n B) to help make this determination. The Town has sought the assistance of an acquisition attorney through Eaton Peabody.

In addition to the operations models/structure (assumed to be a 501-c3) the Action Plan that the Transportation Task Force has been working towards, and now including a transition plan, will also have the following components:

1. State Subsidies
2. U.S. Mail Contract
3. Parcel/Package Services (FedEx & UPS)
4. Town’s School Transportation
5. NEH Landing Rights (scheduled to meet with the Mount Desert Harbor Committee September 8th)

A goal for the final Action Plan will be to have an integrated ferry service for Cranberry Isles, with service from Northeast Harbor and Southwest Harbor/Manset to Great Cranberry, Little Cranberry and Sutton Island. The Town will need a transition plan this fall that will help us get to implementation of an action plan next summer or fall.

Comments from the public noted that the Transportation Task Force seems to have a good model and action plan for the Town, but it appears that the answers we need and currently don’t have for the transition plan involve Beal and Bunker.

Charlie Norris outlined an interim transition plan (dated 8/17/2015)
(insert Interim Transition Plan Here, or add as an attachment)

Questions & Comments:
1. Has the Transportation Task Force done any financial modeling; what are we buying; is Beal & Bunker profitable?
2. The TTF will obtain a financial profile for the Isle au Haut ferry to compare and use as a model.
3. An acquisition attorney will investigate the costs for purchasing the boats and/or business.
4. It is expected that a transition service would run similar to how the Town runs the TCI commuter ferry (an RFP would be issued)
5. It was noted that Beal & Bunker has not renegotiated the price for the U.S. Mail contract in 8 years; they could have done this every 3 years under the current contract issued in 2008. The Task Force will need to make sure that this gets done for the upcoming renewal for the U.S. Mail contract next May (2016) to ensure that the subsidy/revenue for the U.S. Mail contract is maximized for the Town.
6. Communication regarding the U.S. Mail contract will need to take place between the Town and Maine’s Congressional delegation.
7. It will be very important to find ways to cut the costs for operating any ferry service; such as integration of all ferry services, obtaining transportation subsidies, Mail contracts (U.S. mail, FedEx, UPS).
8. The Task Force and Selectmen need to make it clear that if the costs are too high the Town does have other options than buying Beal & Bunker.
9. Suggestion that the Selectmen put out a statement to the public to clarify any possible misinformation; i.e., make it clear to the public what is going on.
10. Use a list-serve and postings on the Town’s website to keep people informed.
11. Transition period may need to be 12 to 18 months.

Ron Axelrod outlined the proposed agenda for the August 29th workshop:

Next regular meeting will Thursday, August 27th at the Islesford Neighborhood
House.

Meeting adjourned at 5:45 P.M.

Attachment: Interim Transition Plan

Town of Cranberry Isles– Transportation Task Force
Time Line-­‐ Ferry Service Implementation
8/26/15

The town has been well serviced by ferry services for many years; however in the past two years, the ferry service operator’s performance has deteriorated to the point where the town’s Board of Selectmen (BOS) formed, in 2014, a Transportation Task Force (TTF) to study and recommend improvements.

After conducting a survey of 190 towns-­‐people, developing service specifications, and reviewing a number of operational models, the preferred structure would be modeled on the Isle au Haut Boat Service operation where the ferry service entity servicing the town would be a non-­‐profit corporation. This entity would bid the operation of the vessels, crew, maintenance, and administration of one consolidated operator servicing the Cranberry Isles to Northeast Harbor and Southwest Harbor.

The town would not run the service, as a non-­‐profit Board of Directors would be responsible for the service. The Board would consist of an experienced ferry operator, one Selectmen, an attorney, a businessman, and other year-­‐round and seasonal residents that had complementary skills and interest in a successful ferry service operation for the township.

The TTF sees this as a very viable option for our town. One of the main items is the “seed” to start the non-­‐profit/ferry service. Beal and Bunker (B&B) has stated they will discontinue all ferry operations by winter of 2015, and intend to sell their current operation and some of the vessels to the town. Alternatively the town may lease or purchase other vessels for a transitional service this winter, spring and summer, until the new non-­‐profit is up and running. The BOS has contacted the town’s attorney to identify an appropriate acquisitions attorney to act on its behalf in discussions with B&B and/or others on the acquisition cost, transfer of contracts and licenses, and temporary operation of the service till the new non-­‐ profit entity’s operator is selected.

A tentative timeline follows:

Aug. 15 to Sept. 15: Discussion and negotiation between B&B, other vessel sellers, and TTF on acquisition of vessels.

Oct. 1: TTF to issue interim operations plan from B&B or other acquisition to turn over to new non-­‐profit ferry service entity.

Oct. 15: Special Town Meeting to approve funds for acquisition including B&B or alternative vessel purchase or lease to include cost, legal and professional fees,
and other costs of operation to forming the non-­‐profit entity.

Oct. 15: Town issues Request for Proposals (RFP) for ferry operations for winter, spring and summer

Nov. 1: TTF Interim service operation begins

Jan. 1: Non-­‐profit entity established and budget for 2016 finalized for presentation in a Warrant at the March 2016 Town Meeting.

May 1: TTF issues Request for Proposals (RFP) to ferry service operators for a five (or seven) year contract of operation.

July 31: Proposals due to TTF for ferry service operation contract

Oct. 15: Non-­‐profit ferry service contract starts operation.