Transportation Commission recommends fare hikes, state tax for ferries
March 5, 2009 · Updated 5:03 PM
Washington State Ferries could stay above water financially through steady fare increases and a state vehicle tax.
That was the recommendation of the state Transportation Commission, which advised the House Transportation Committee Monday that raising fares 6 percent annually for the next five years could take care of WSF’s operating costs, while a statewide tax could best address the system’s gaping capital needs.
But Kitsap legislators say it is unlikely that a new tax would be supported this session.
“I don’t think that the economy or the voters are in the position to make that decision,” Rep. Christine Rolfes of Bainbridge said.
The commission’s long-range funding study is among a dizzying number of plans, studies and surveys legislators will be considering as they begin crafting a ferry budget in coming weeks.
The final report of the funding study – conducted by Caimbridge Systematics – found that steadily increased fares, along with expanded use of advertising and similar money-making ventures could meet WSF’s operational needs. The study based its operations figures on WSF’s proposed Plan A, which calls for minimal increases in capacity over the next 22 years, and estimates a $213 million operating deficit over that period.
The commission had mulled a local tax to support ferries, but determined that the levy would be a hard sell to voters and a multi-county district would be logistically challenging.
Its report did recommend more intensive advertising and concessions programs and noted that selling naming rights to ferries could raise hundreds of thousands annually. A fuel surcharge on fares was also proposed.
The commission said those strategies be combined with a 6 percent annual fare increase could meet WSF’s operation’s costs.
A fare freeze imposed by a 2007 bill is set to expire in September. Rolfes said she expects fares will increase once the freeze is lifted. But legislators will need to decide in coming weeks how much of WSF’s operating costs should be collected from fares, she said.
Balancing WSF’s operations ledger will be easy compared to meeting its looming capital deficit.
The agency’s Plan A figures a $3.1 billion gap over 22 years, for gradual vessel replacement and terminal upgrades.
That hole could be filled by a statewide 0.15 percent motor vehicle excise tax ($30 for a $20,000 vehicle), according to the commission’s study.
The commission concluded that the MVET would be more reliable than the gas tax and pointed out that the loss of MVET funding in 2000 was a major contributor to WSF’s financial woes.
Kitsap legislators said it’s very unlikely new revenue sources for ferries will be pursued this year. The governor has already vowed not to raise taxes and the emphasis this session has been on working more efficiently within existing budgets. For the next biennium, the best ferries can likely hope for is a larger slice of existing transportation funding.
Poulsbo Rep. Sherry Appleton said an MVET or similar tax would eventually be a good approach.
“It’s going to have to be a statewide tax,” she said. “But it depends on the legislators from eastern Washington. We’ve been giving gas tax money for their roads but we’ve gotten very little for the West Sound and our marine highway.”