Casco Bay Lines OKs first rate hike in 15 years, and it’s a big one

The Casco Bay Lines ferries Aucocisco III and Machigonne II cross paths on Casco Bay on Thursday. Ferry fares will increase 82% on June 1, when a flat fee of $14 is instituted for all round-trip island ferry trips. It’s the first fare increase in 15 years and is designed to offset a ballooning deficit due to high operating costs. Gregory Rec/Staff Photographer

Visitors to Peaks Island and the other Casco Bay islands may experience a bit of sticker shock this summer.

The Casco Bay Island Transit District voted 10-1 on Thursday to approve an 82% increase in round-trip ticket prices, while lowering prices for longer-term passes, benefiting residents and people who work on the islands. The ferry service’s first price hike in 15 years is designed to offset a ballooning deficit as operating costs mount and revenue remains flat.

The new fare schedule, which still needs approval from the Public Utilities Commission, will institute a flat $14 rate for all islands served by the Casco Bay Lines – Peaks Island, Little Diamond Island, Great Diamond Island, Long Island, Chebeague Island and Cliff Island – beginning June 1.

The current fare structure for the peak summer season has round-trip tickets for Peaks Island at $7.70 and higher rates for the other islands, capping off at $11.55 for Cliff Island.

It’s a steep increase, but both the board of directors and island residents say it’s long overdue.

Board member Joe Donovan hopes the decision to offer half-price tickets to children under 18 – instead of those under 14 – will help encourage island living for more families. Seniors and people with disabilities, who already qualify for half-price tickets, will continue to be eligible for lower fares.

Jennifer Lavanture, chair of the finance committee, said the operating loss has been “growing out of bounds and really unacceptably” for a number of years, with expenses almost doubling the rate of inflation. The agency’s fiscal year 2024 budget featured a roughly $4.3 million deficit but broke even with an increase in grant funding.

The 2024 budget was passed with the requirement to reduce the operating loss by 25% – or about $1 million – through a combination of expense reduction and revenue increase.

The deficit has been growing steadily since at least 2019 even without the impact of the COVID-19 pandemic, which exacerbated the existing challenges.

Casco Bay Lines is largely funded by the fares it charges for regular ferry service. The remaining revenue comes from specialty offerings like cruises and tours, as well as state and federal funds.

But that funding is not always a guarantee, and Lavanture said Thursday that it was important for the board to act quickly and before the start of the summer season so that more drastic action isn’t required down the line.

“I don’t think we can afford to wait,” she said.

NEW RATES

The new rate structure would include the $14 flat rate for adults in peak season and a $7 rate for seniors, people with disabilities, and children between 5 and 17 years old. Reduced fares of $7.20 and $3.60 would be available in the offseason.

The proposal eliminates commuter books, blocks of five discounted tickets, which were subject to abuse by people using them for group discounts.

The bulk of the financial benefit for Casco Bay Lines will come from the price increase on single round-trip tickets to Peaks Island, which sees the vast majority of visitors.

Casco Bay Lines had just over 1 million riders in 2022 between the regular ferry service and tours. Of those, about 737,000, or roughly 74%, were traveling to and from Peaks Island. Figures from 2023 were not available Thursday.

Some have suggested that a flat rate could help draw visitors to islands other than Peaks, which currently offers the least expensive ticket.

The proposal restructures and reduces the cost of the 30-day and annual passes while adding a 90-day option.

For people who only leave the islands infrequently, prices will go up.

But John Whitman, a Peaks Island resident, said that for people who leave, say, once a month, the extra $6 during the summer and an extra $3 during the cooler months is “not the end of the world.”

“People expect prices to go up. This is long overdue,” he said.

The new fare structure decreases the annual pass – which currently ranges from $906 for Peaks Island to $1,376 for Cliff Island – to $432 for all islands and adds a half-price option.

The 90-day pass will be $144 during peak season and $96 during the offseason, with half-price offerings as well.

The elimination of the commuter books, which offered five tickets for $23.95, will be a blow to some, but some of that loss will be offset by the decrease in the monthly fare from $82.50 to $32, with half-price and offseason options.

Last year, the ferry service sold just 45 annual and 800 monthly passes.

BIGGER IMPACT ON TOURISTS

James Luedke, a board member, said it didn’t quite sit right that the increase would negatively and disproportionately impact tourists, but he welcomed a flat rate across all islands, which he hopes will reduce the complexity of the ticketing system and give way to the faster adoption of electronic ticketing technology.

The Casco Bay Lines ferry Wabanaki returns to Portland on Thursday. Ferry fares will increase 82% on June 1, when a flat fee of $14 is instituted for all island ferry trips. It’s the first fare increase in 15 years and is designed to offset a ballooning deficit due to high operating costs. Gregory Rec/Staff Photographer

Lavanture said the changes are projected to increase revenue by about $500,000, though various scenarios placed impacts anywhere from $200,000 to $1.6 million.

Transit district officials also are working on proposals to cut down on operating expenses. The proposal did not expressly address cruise, freight or vehicle pricing, but those conversations are in the works.

Some island residents said they were disappointed that there was no friends or family discount, but board members said they plan to explore that possibility once the new costs get underway and they can devote the necessary resources to working through eligibility and enforceability issues.

This is not the first time that the quasi-municipal corporation has discussed a price hike.

The finance committee last summer weighed several scenarios that would have raised rates anywhere from 8% to 16% but also would have reduced staff, terminal security and the number of trips on the schedule. Members would have needed to make a decision quickly in order to have the changes in place by the start of the fiscal year in the fall, and the proposals ultimately never advanced.

Lavanture said Thursday that she wasn’t necessarily proud to be the one to bring a price increase forward, but that it was critical to the financial longevity of the ferry service.

The board will evaluate ticket prices every one to two years.

“It’s a muscle we need to be building,” Lavanture said. “We can’t let another 15 years go by.”