June 14, 2001 – In a long and sometimes confusing meeting Wednesday, the V.I. Port Authority board voted to give Boston Harbor Cruises, and any and all other interisland fast-ferry services, a break on port fees. Another company, Crucian Express, announced plans to begin operations in the fall.
Boston Harbor Cruises operates the $10 million, 600-passenger catamaran Salacia, which transported passengers between St. Thomas and St. Croix during a test run in April. In 23 days, company officials said, it carried 23,000 passengers at a preview round-trip fare of $40.
Kevin Matthews, BHC director of operations, met with Gordon Finch, Port Authority executive director, prior to Wednesday's meeting on St. Thomas, seeking to get the head tax phased in over five years so the company could provide a lower passenger fare.
In a letter to Finch, Matthews outlined seven incentives wanted from the authority so the ferry could return to service later this year.
However, Finch said Wednesday that it all "boils down to a simple matter of fees." The board voted to:
– Charge no head tax for the first year, effective immediately; $1.50 the second year and $3 the third year. The tax was $5.70 when the boat was in operation in April.
– Waive dockage fees for the first two years on St. Croix only.
– Waive all fees if the company would base its operations in Fredriksted.
While board interest in giving St. Croix an economic boost was clear, Matthews looked bewildered when the motion was made about basing operations in Fredriksted. Pamela Richards, who as Tourism commissioner by law chairs the board, made the motion.
Traveling embarking and disembarking at Fredriksted, on the island's West End, would add unnecessary time on the water — and also on land for those traveling to the island's main commercial area of Christiansted. Someone commented that it would be like moving the Cyril E. King Airport to Crown Mountain.
Before the final vote on the fee schedule, a motion to reduce the head tax to $3 was approved. At one point, amid a bevy of motions, Attorney General Iver Stridiron, a board member who abstained from voting, said, "I would like to know what we just voted on."
Port Authority attorney Don Mills summarized what had just transpired. Stridiron said the motions, introduced and voted on within about an hour, were not well thought out and needed further discussion. Other board members and staff personnel expressed confusion about what exactly was being voted on.
Stridiron also expressed concern about local airlines such as Seaborne, Cape Air and American Eagle, saying they have a vested interest in the territory. Matthews declined to speculate on how the fast ferry might impact local air-shuttle traffic. However, he said BHC has run competitively with Cape Air in the Boston area, with Cape Air's load factor actually increasing.
Seaborne Airlines officials have written Finch expressing concern that the operation could go out of business trying to compete with BHC. Maurice Kurg, Seaborne president, said the company might be interested in starting a high-speed ferry of its own.
Representatives of another fast-ferry company, St. Croix-based Crucian Express, also appeared at the board meeting, announcing plans to purchase a Norwegian vessel capable of a speed of 40 knots (the same as the Salacia), with seating for 271.
Plans call for this ferry to run year 'round, according to Jolene Wilson-Glah, the company's legal counsel. She said Crucian Express plans a September start-up with three round-trips a day. Start-up costs are estimated at $2 million, she said, to be raised through the sale of common stock shares.
After the board vote Wednesday, Matthews said he was marginally pleased at the outcome. Standing outside the meeting room, he said he was happier than he had been 45 minutes earlier, when the head tax was scheduled to start at $3 with no start-up incentive.
Matthews told the board he couldn't estimate how much the company will charge passengers, but he finally threw out the figure of $50, stating he could not be held to it. After the meeting, he said he would "have to give the figures to my numbers people." In his meeting with Finch and the letter to him, Matthews stressed that the company wants to make a decision before the end of June, in order to get marketing in place if it proceeds with plans to operate in the territory. Service would be from about December through May, he said.
Matthews came to St. Thomas from a series of talks in Florida about starting a winter operation there — which he told reporters is still an option.
