Finance Committee – Rate Change

UPDATE AS OF APRIL 25, 2025

Casco Bay Island Transit District Public Hearing Notice

Date:    Friday, May 9, 2025

Time:    7:45 AM

Place:    In person (CBL administrative offices, 56 Commercial Street, Portland, Maine 04101) or virtual

Topic:   Proposed major changes in non-commercial and commercial vehicle rates to Peaks Island

Event address for attendees:

https://cascobaylines.webex.com/cascobaylines/j.php?MTID=meeed7ad7cf859575abff5e97e5579d94

Event Password: CBL123 (225123 from phones)

Audio conference:

United States Toll

+1-408-418-9388

Meeting Access Code: 2344 209 2830

The Board is considering two proposals that will raise non-commercial vehicle rates to Peaks Island. The Board may also adopt a different proposal should one be raised at the hearing.

Proposal #1

Proposal #2

*Annual Pass holders are eligible to purchase Discount Rate tickets. 90-day pass holders may purchase a vehicle add on at the time of pass purchase ($50 per full fate pass, $25 per half-fare pass). 90-day pass holder with the vehicle add on may purchase Discount Rate Tickets.

For additional details, please see Finance Committee Presentation from April 24th – CBL board vehicle fare workshop 2025-4-24 – Read-Only

The table below outlines the proposed commercial vehicle rates.

All public comments sent to moc.s1746151318enily1746151318abocs1746151318ac@eg1746151318nahce1746151318tar1746151318 received before 6:45 AM on the morning of the meeting will be shared with the Board for consideration. Agendas and meeting information can be found on the CBITD website calendar.  Please check the calendar frequently for any updates or changes to scheduled meetings or dial-in information.

The public is encouraged to attend.

UPDATE AS OF APRIL 23, 2025

Materials and commentary provided by the Treasurer of the CBL Board of Directors

Finance Committee Presentation (April 17th) – CBL Finance Committee vehicle fare workshop 5 2025-4-17 – Read-Only

Nest Steps: Workshop at Board of Directors Meeting – Thursday, April 24, 2025 at 7:45 AM

Board of Directors Presentation (April 24th) – CBL board vehicle fare workshop 2025-4-24 – Read-Only

UPDATE AS OF APRIL UPDATE AS OF APRIL 10,2025:

Materials and commentary provided by the Treasurer of the CBL Board of Directors

Finance Committee Presentation (April 9th) – CBL Finance Committee vehicle fare workshop 4 UPDATED POST MEETING 2025-4-9

Note: Appendix was not presented. Updated examples in appendix updated to reflect seeming consensus around eliminating annual pass supplement fee (which were not presented).

Nest Steps: Finance Committee – Thursday, April 17th at 12:30 PM (please note different meeting time)

UPDATE AS OF APRIL 3, 2025:

Materials and commentary provided by the Treasurer of the CBL Board of Directors

Finance Committee Presentation (April 2nd) – CBL Finance Committee vehicle fare workshop 3 2025-4-2 (002))

Next Steps: Finance Committee – Wednesday, April 9th at 7:45 AM

UPDATE AS OF MARCH 21, 2025:

Finance Committee: Finance Committee Vehicle Rate Change Discussion

Materials and commentary provided by the Treasurer of the CBL Board of Directors

Finance Committee Presentation (March 19th) – CBL Finance Committee vehicle fare workshop 2025-3-19

Proposed Rates (discussed at the March 19th Finance Committee Meeting) – CBL vehicle tarriff proposal draft summary for Finance Comm workshop 2025-3-19

Next Steps: Finance Committee Workshop on Vehicle Fares – Wednesday, April 2nd at 7:45 AM

UPDATE AS OF MARCH 14, 2025:

Materials and commentary provided by the Treasurer of the CBL Board of Directors

Vehicle Fare Change Intro:

• CBL fares do not cover expenses. CBL operates with a multi-million dollar deficit every year. For more information: CBL Finances Big Picture for 2.2025 Finance Comm meeting v2
• CBL is dependent on Federal government grants to plug annual operating deficits.
• CBL Board prioritized reducing deficit, for 2024 was $2.6m compared to $4.5m in 2023.
• CBL’s ability to serve islanders year-round is at risk if deficits continue and grants are not available, changes under the new administration create uncertainty.
• Finance Committee is prioritizing tackling vehicle fares to raise revenues and reduce deficits fairly while supporting islanders and frequent vehicle riders who depend on the ferry.
• Goals of the vehicle fare change include reducing congestion and addressing fairness in charging large commercial vehicles for extra space rather than by weight.

Background:

• Passenger fare change implemented 6/1/2024 after a public process and Public Utilities Commission (PUC) review. Passenger fares had not been raised in 15 years.
• Passenger fare change has been successful: revenues increased, mostly from summer visitors; islanders/workers/frequent visitors mostly switched to affordable passes.
• CBL met its deficit reduction goal for FY 2024.
• Passenger rate review presented, with comments on overall financial performance, at Jan 2025 Finance Committee meeting, CBL Finance Comm Incoming Treasurer remarks FINAL 2025-1-15. Islander feedback on passenger fare change majority positive.
• Vehicle fares are next; rates have not been raised in >15 years, while vehicle traffic has increased and large commercial vehicles take up extra space, creating unfairness.
• Freight revenues will also be addressed in future; a cadence of timely fare assessments is planned so that increases are gradual and more predictable.

Background:

The Casco Bay Island Transit District has historically operated at a multi-million dollar loss annually, which is offset by grant revenue (primarily Federal tax dollars) to achieve a neutral balance. In recent years, the magnitude of operating loss has been growing, resulting in scrutiny by the Board of Directors and prioritization of reducing the deficit through both increased revenues and decreased operating expenses.  A first step to increasing revenues was through the Passenger fares restructuring that was implemented in June of 2024 – the first rate change in 15 years.  Please see Finance Committee – Rate Change – Casco Bay Lines for background, discussion and final rates.

The passenger fare change has been successful.  The first 6 months of implementation saw increased revenues, with the rate change the main driver of a reduction in the operating deficit for 2024 to $2.6 million (compared to the $4.5m loss in 2023).  Additionally, there was not a decline in passenger volume, and feedback from both residents and businesses has generally been positive.

The Finance Committee prioritized passenger rates first, vehicle rates second, and freight rates third to complete overdue attention to fares. CBL’s expenses also need to be reduced so that the operating deficit can be reduced and the District can continue to fulfill its mission of operating ferries to serve the six residential islands of Casco Bay year-round.

Vehicle Rate Change:

A proposal for a vehicle rate change was introduced and a public workshop conducted by the Finance Committee on October 1, 2024. A copy of that proposal is here: CBL_ FIN COM_VEHICLE RATE WORKSHOP_2024-10-01

Subsequent to that public workshop, the Finance Committee paused consideration of vehicle rate changes. The pause allowed time to further consider how to structure a discount that would compliantly support affordability for year-round islanders and frequent vehicle travelers, including people who use vehicles for work on the islands, while increasing revenues.

Goals of Vehicle Fare Change:

1. Increase revenue to CBL, noting increased risk and uncertainty of Federal grants to plug operating deficits
2. Support island affordability and access, year-round, including residents and people who use vehicles for work on Peaks
3. Reduce congestion on Peaks and Portland, offering more discount travel times than “wacky Wednesday”
4. Charge fairly for large commercial vehicles, calculating by size not weight, and charge for trailers/racks that take extra space

The Finance Committee and Board recognize both the importance of vehicle access and affordability for islanders and the complexity of vehicle fares, consideration of which will raise the many questions and concerns. We anticipate multiple meetings of the Finance Committee to insure full vetting of proposals and consideration of public input and the impact on Peaks islanders, workers, visitors, ferry crew and CBL operations.

Timing:

Our goal is to have new fares in place for the summer season in order to make a meaningful reduction in this year’s operating loss and reduce summer congestion. We expect to have an opportunity for additional changes in future to optimize these complex fares and ensure that the District can continue to fulfill its mission of delivering year-round service to all the residential islands of Casco Bay in a manner that is as affordable as possible.

Process for Considering Vehicle Fare Change (Next Steps):

The Finance Committee plans to conduct a workshop to discuss vehicle fare changes at its monthly public meeting, on March 19, 2025 at 7:45 am. The meeting is a hybrid format with in-person (at CBL terminal) & online (via Webex) options for participation. The meeting Agenda and link to join the meeting will be posted on Casco Bay Lines Board of Directors.

The workshop is intended to continue the process started at the 10/1/2024 finance committee workshop. The workshop format will be:

• Presentation of background information and the revised proposal
• Committee discussion of proposal
• Public comment
• Summary of next steps

Following the March 19^th workshop, the Finance committee intends to schedule additional public workshops to fully explore proposals and consider feedback.   The Finance Committee then intends to make a recommendation to the Board of Directors for consideration and action at an April or May Board meeting.

A public hearing will be held at a Board of Directors meeting after the Finance Committee has reached a recommendation. The meeting notice and agenda will be posted.

Once a rate structure is passed by the Board, it will require submission to the Maine Public Utilities Commission (PUC). Any proposed effective date for new fares would be set no less than 30 days after approval by the Board.

How to Provide Feedback:

Public participation and comment are welcome and encouraged at all meetings, workshops, and hearings. Written comments may also be shared via email to moc.s1746151318enily1746151318abocs1746151318ac@eg1746151318nahce1746151318tar1746151318 with Jean Hoffman, Finance Committee Chair, on copy (moc.s1746151318enily1746151318abocs1746151318ac@hn1746151318aej1746151318).

Finance Committee: Passenger Rate Change Proposal 2024

UPDATE AS OF APRIL 25, 2024:

Notice is hereby given that, effective June 1, 2024, Casco Bay Island Transit District is discontinuing all Peak and Off-Peak Passenger Rates (including commuter books) previously differentiated by island and replacing them with the following Round Trip Passenger Rates for all islands. Bike and Domestic Animal rates are also changing.

Each 30-day, 90-day, and Annual pass includes the transportation of one bike and/or domestic animal with the pass holder. All currently outstanding tickets, passes and books will continue to be valid until the expiration date as printed. For purposes of discounted fares, the definition of child will be as follows: children under 5 years of age will be transported free while children 5 or more years but under eighteen years of age will be transported at the children’s fares named herein.

A public hearing and Board of Directors vote and approval for these changes was conducted on April 25, 2024.  More information will be available at the Transit District’s website. Any 50 or more ratepayers may file pursuant to 35A M.S.R.A., Section 1302, a written request with the Maine Public Utilities Commission in Augusta for an investigation of the rate changes adopted by the Transit District.

Finance Committee: Rate Change Proposal 

RateChange_Proposal_Summary_2024-04-10

CBL_ FIN COM_RATE WORKSHOP_2024-04-15

The Casco Bay Island Transit District has historically operated at a loss, which is offset by grant revenue (Federal, State and some City tax dollars) to achieve a neutral balance. In recent years, the magnitude of operating loss has been growing.   Notably, the gap between revenues and expenses increased significantly in 2019 and then continued to widen in 2022 through to the present (even when the Covid years are excluded).

The board has been concerned about the growing losses since the budget for FY 2023 was presented in September 2022 with a projected $4.2mm loss. At that time the board asked that the loss be reduced. Expenses have risen, including for diesel fuel and dry dock. Additionally, tariff rates (i.e., ticket prices) have remained unchanged for 15 years, contributing to the magnitude of the operating loss.  Islanders and visitors have been fortunate that fares have not gone up in 15 years, but this trend cannot continue.

The FY 2024 budget was approved with a $4.3 million operating loss, again offset by grant revenue to achieve a neutral balance. The approval also included a directive to reduce the operating loss by 25% or $1.075mm through both expense reduction and revenue increase strategies. Our auditors have repeatedly recommended fare increases and noted that there have been no increases in over 10 years. Multiple efforts are also underway to reduce expenses.

A proposal for a revision to the passenger tariff was presented at the March finance committee meeting (click here to view the proposal/presentation materials).

The committee has proposed a revised, simpler fare schedule that raises fares for single tickets and offers monthly and annual pass deals for islanders and other frequent ferry riders such as people who work at island businesses.

The Finance committee and board welcomes citizen input and consideration of the proposed new fare structure. Please feel free to contact board members, to send an email with comments to the dedicated email below or to join one of our public meetings, in particular the April Finance Committee meeting. More info on how to provide input is below.

Our goal is to increase revenues by ~$500k+, while preserving access and affordability for those who ride and support the ferry year-round and who are dependent on the ferry to get to work and school or otherwise to Portland. The aim is to have new fares in place for the summer season in order to make a meaningful reduction in this year’s operating loss. We expect that there will be opportunity for additional tweaks and changes in future to optimize to ensure that the district can fulfill its mission of dependable, reliable service as affordably as possible.

Next Steps: 

A workshop and public hearing will be held at the Finance Committee Meeting on April 10, at 7:45am.  At the conclusion of this meeting, the Finance committee intends to make a recommendation to the Board of Directors for consideration and action at the April Board meeting.

A public hearing will also be held at the April Board of Directors meeting on April 25, at 7:45am.  The agenda will include as an item of business, consideration and action on the recommendation from the Finance committee.

If any proposal is passed by the Board, it will require submission to the Maine Public Utilities Commission. Any proposed effective date would be set no less than 30 days after approval by the Board.

How to Provide Feedback:

Public participation and comment are welcome and encouraged at all meetings, workshops, and hearings. Written comments may also be shared via email to moc.s1746151318enily1746151318abocs1746151318ac@eg1746151318nahce1746151318tar1746151318 with Jen Lavanture (moc.s1746151318enily1746151318abocs1746151318ac@lr1746151318efinn1746151318ej1746151318) and/or your local director on copy.