Page Fifty-Six 

12 JANUARY 2006

 

Adventures in Idiocy.

 

 

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Do we owe Toronto $250,000 annually for 14 years?

JAMIE GERMANO staff photographer

The demise of the ferry, at the Port of Rochester, will be a hardship for businesses in the terminal, but city officials say they are committed to waterfront development.

(January 11, 2006) — Rochester City Council members and former City Hall officials maintain that a 14-year contract requiring a payment of at least $250,000 annually to the Toronto Port Authority was simply the cost of doing business.

But Mayor Robert Duffy saw that expense as another financial burden proving that the city was paying too big a price for the high-speed ferry while receiving too little in return.

"We are paying Toronto to receive a tremendous economic benefit," Duffy said about the contract, which he highlighted in his announcement Tuesday that he will pull the plug on the high-speed ferry.

The actual contract approached costs of about $500,000 a year, because it also included a $1 surcharge per passenger and $3 charge per vehicle, Duffy said.

Linda Kingsley, the city's corporation counsel under former Mayor William A. Johnson Jr., said it "was widely known" that the city had to pay Toronto for use of the port. She said Johnson had talked publicly about the fee.

But Duffy and his corporation counsel, Thomas Richards, contend that the contract was news to the incoming administration.

"We're paying the whole ticket and most of the benefit is going to other places," Richards said. "With all due respect, Rochester is not in the position to subsidize Toronto's tourist trade."

Rochester Ferry Co. (2005)
  • Benjamin Douglas, president.
     
  • Charles C. Barrentine, vice president.
     
  • Karen Noble Hanson, secretary.
     
  • William J. Ansbrow, treasurer.
     
  • Managers: Edward J. Doherty, Wade Norwood, Gladys Santiago, Loretta Scott, Linda Stango.
     
  • Ex Officio: Lois Giess, William A. Johnson Jr.
  • City Councilman Benjamin Douglas, the ferry board president, said he disagrees that the costs served as a subsidy for Toronto tourism.

    "I would look at it with a broader viewpoint, as the cost of operations," he said.

    Several City Council members who also served during the Johnson administration said they were aware of the contract.

    "That wasn't hidden information," said City Councilman Adam McFadden. "That was known information. Whether or not people agree with it, that's a whole different question."

    The most pressing question for the current administration is this: Can the contract be broken, or will the city be forced to make payments even after the demise of the high-speed ferry?

    Kingsley said the contract, as she recalls, would be broken if the Rochester Ferry Co. dissolved. That way, she said, the city would not be liable for further payments in future years.

    Richards said Tuesday that he is still reviewing the contract — which was signed by then-Mayor Johnson in late 2004 or early 2005 — to determine the impact.

    "We may have to negotiate a resolution with (the Toronto Port Authority)," he said.

    2006 board
    Norwood, Doherty, Scott, Stango and Johnson are replaced by Dana Miller, Paul Holaham, Patty Malgieri, Gary Walker and Robert Duffy.

    City Council President Lois Giess said the previous ferry owners, Canadian American Transportation Systems, also had a similar contract with the Toronto Port Authority that was even more costly.

    The Rochester ferry board had a similar contract requiring a $150,000 annual payment to dock at the Port of Rochester, Richards said. That cost was supposed to be paid to the city under the contract, he said.

    What's at stake
    The high-speed ferry was envisioned as an economic development tool, particularly for Charlotte. While ending service brings spiraling debt under control, the city now must figure out how to repay bills of the past year.

    The costs were not paid, he said.

    GCRAIG@DemocratandChronicle.com
    BDSHARP@DemocratandChronicle.com


    Includes reporting by staff writers Joseph Spector and Steve Orr.

    Related articles:
    On the Web:
    What is a public authority?
    Public authorities, like Rochester Ferry Co., were created to finance, construct or operate revenue-producing facilities for the public benefit. There are more than 730 public authorities in New York.

    Public authorities have the power to levy user fees and charges, but not taxes. Most public authorities have the ability to borrow funds by issuing debt. They are generally overseen by a board of directors and managed by a full-time president and staff.
    The contract
    In late 2004 or early 2005, the Rochester Ferry Co. entered into a 14-year contract with the Toronto Port Authority for docking the high-speed ferry in Toronto. According to city officials the contract requires:
     
  • A payment of $250,000 annually to the Port Authority.
     
  • A payment of $1 per person traveling into Toronto on the high-speed ferry, a cost tied to Canadian Customs.
     
  • A payment of $3 per vehicle traveling into Toronto on the ferry, another Customs-related cost.
  • Well now.  Looks like overconfident arrogance did a real number on the city's finances.

    That supreme unjustified confidence caused the city of Rochester to lease the ferry terminal to Maplestar -- a CATS offshoot -- for $1 per year for a term of FORTY YEARS.  The success of a completely untested ferry service was simply taken for granted.

    Who in their right mind would offer such a lease?  Assuming the ferry would be around for a little of five years was presumptuous...but FORTY YEARS??  Unreal.

    Now we learn the city agreed to sweeten the pot to the tune of a quarter million a year to the Toronto Port Authority for FOURTEEN YEARS.  Plus a buck a head and $3 a car.  If such an arrangement was proposed by TPA officials, Toronto really needs to think about keeping THOSE folks around.

    Honourable mention:

    Plan overboard

     So much for the cockamamie scheme that was the Rochester fast ferry – first called "The Spirit of Ontario", then "The Breeze" and finally "The Cat" – as the city's new Mayor Bob Duffy rejected an $11.5 million loan to keep the luxurious vessel afloat. But it's not sailing away without one lingering insult to taxpayers across the lake – the discovery of a stealth contract that promised a $250K annual payment to Toronto Port Authority for the next 14 years, in order to dock a ghost ship. The ferry cost $42.5 million new in 2003, it was salvaged by the city for $32 million a year ago, and whatever price they can unload it for – combined with the operating losses of thePass past year – won't pay off the full debt. Despite initial turbulence, recently retired Mayor William Johnson insisted any further financial influx was a safe investment, combined with improved pricing and scheduling, a plan to ship the 774-passenger boat off to warmer climes during winter months, and marketing slogans for the catamaran better than "Treat someone to a purrrrfect travel experience." Rochester can now stop waiting for GTA tourists to arrive at their sparkling new terminal, The Native Canadian website can wrap his unhealthy obsession with the ferry's journey to oblivion, and we can return to columns in The Buffalo News that struggle to assert America's moral superiority over the other side of the lake.

    'Obsession'?  Sure, why not?  Trust me, I've had far worse.  'Unhealthy'?  You don't know the half of it.  Let's leave it at that.

    As for wrapping up this tempest in a teapot... not a chance.  I'll stuff this petulant exercise in governmental waste when Canadians quit trying to overthrow the government for some $100 million 'scandal'.  At a measly $4 a head, Conservative-minded Canadians should thank their lucky stars for such a bargain. 

    Try $6 BILLION a MONTH for a so-called 'war', THEN come crying to me about a government 'scandal'.  Or a proposed $51.5 million debt on some superfluous boat for some small burg.  THAT would cost each Rochesterian far more than some 'sponsorship scandal' would cost each Canadian.  Yet Canadians are all hot 'n bothered about 'Liberal corruption' chewing up their pizza budget?  You wanna talk about "unhealthy obsessions"?

    $100 million for a entire COUNTRY?  Are you kidding me??  Two raised glazed and a large double-double amounts to more than the per capita cost of some of the 'HORRENDOUS' Liberal scandals.  Wimps.  Let's talk about some serious money here... not the equivalent of dinner for four at Denny's.

    Toss out the Liberals and vote in Harper's Bizarre; you think THAT'S going to stop 'scandals'?  The only difference will be right-wing special interest groups get the goods instead of a left-wing special interest groups.  After the economy is slammed into reverse, Canadians will rear up in feigned indignation and repeat the entire process all over again. 

    Brian The Hated passes the baton to Kim The Clueless who makes way for Ti-Jean The Terrible who defers to Paul The Corrupt.  In due time, the next PM will be duly bashed and sent packing even though at the time of their election, they were the antidote to all that ails Canada.  Bitch, bitch, bitch.  Canadians ought to try living on THIS side of the dotted line to find out they've got a pretty damn good thing going.  Tell you what: Canada can have George Bush if the States can have Paul Martin.  Deal?

    Appreciate the mention, Paved.   But the story doesn't end here.   More Smug Ones need to be pie'd, the status quo has got to go and there are a slew of axes which need grinding.  What fun's a website if not to hold up a cyber-mirror to the irritating warts of life?  Sometimes vindication for vindication's sake is reward enough.

     

     

    41º | Hi 59º / Lo 38º |
     
    Toronto diner owner: 'I'm sad....I saw the potential'


    (January 11, 2006) —
    The gates to Toronto's fast ferry terminal were padlocked Wednesday.

    The sign said that the ferry was closed for the season but the wording may be revised, now that Rochester Mayor Robert Duffy has announced that the problem-plagued ferry service between Rochester and Toronto is shutting down.

    Ken Lundy, spokesman for the Toronto Port Authority, said he was surprised and disappointed at the news. "We did over a quarter-million people," said Lundy, chief of operations and engineering for the Port Authority. "I cannot argue with the economic benefits to our area."

    Lundy said the terminal also was used during the boating season for charter boats that went around the Great Lakes, as well as for offices for Bay Ferry personnel.

    Lundy said he had planned to meet in December with Mayor-elect Duffy and outgoing Rochester Mayor William A. Johnson Jr. about marketing plans for the ferry, but that the meeting had been canceled due to a snowstorm.

    He said he planned to discuss the contract between the ferry board and the Port Authority — he called it a lease agreement — with Rochester officials. "We're more than happy to do that."

    Meanwhile, news of the ferry's demise was barely mentioned in Toronto newspapers.  (The Star had a story out at 1:00am on Wednesday morning.  You expected screaming headlines like today's Democrat and Chronicle?  We're talkin' HUGE letters readable from across the street.)

    Mary Jatto, who owns Cherry Street Diner near the terminal, said she saw an increase in business from ferry riders. "I'm sad," she said. "I expected it to do better. I saw the potential."

    Richard Van Boxmeer, 47, of Toronto didn't know the ferry had been shut down until he was told by a reporter as he walked his dog.

    "I was surprised that it lasted as long as it did," he said.

    Van Boxmeer said he had never ridden on the ferry.

    GLIVADAS@DemocratandChronicle.com

    Sheesh.  Just what did this D&C reporter expect?  A massive blue funk descending upon Greater Toronto over the sorry demise of the ferry?  Sullen street crowds shuffling quietly along Yonge Street wistfully kicking themselves for not taking the ferry when they could?  All along, Toronto has been obliviously indifferent to the thing, so there really shouldn't be any expectations of mourning on the part of Torontonians.

    A sly grin or two at pulling off a fast one on some Upstate NY city... maybe.  But I think 'indifferent' pretty well sums it up, don't you?

    "I was surprised that it lasted as long as it did," he said.

    I heard that more than once today while hanging out in Cabbagetown.  The folks in St.Catharines were a bit more sympathetic -- the Niagara side of the QEW has always been a little more diplomatic than the other end -- but the general consensus was it's better to cut the losses now rather than later.

    An editorial lament:

     

     

    42º | Hi 59º / Lo 38º |
     
    Well-reasoned call
    The ferry became a drain on finances that the city couldn't afford

     

    (January 11, 2006) — Rochester's ill-fated flirtation with the high-speed ferry business is over, and the breakup, as painful as it is, is the right decision for city taxpayers and the community.

    New Mayor Robert Duffy and his team pored over the books, tested possible scenarios and came away with an inescapable conclusion:

    This isn't working.

    And it won't work, even with an additional $11.5 million of borrowed capital. If the ferry had a flawless 2006 season, if ridership doubled in spite of increased fares, if nothing broke down or fell off, the city would still have a shortfall coming into 2007.

    The deficit would rise if the city committed to $2 million in marketing needed to improve ridership.

    This decision leaves many in its wake, including this page. We supported the ferry. We accepted the business plan assumptions, first from private owners Canadian American Transportation Systems and then from the William Johnson administration.

    The assumptions were built on hope, which was like building them on air.

    Duffy and his team — corporation counsel Tom Richards was the chief myth buster — replaced air with the ground of reality.

    The ferry operation was poisoned by secrecy and obfuscation that reflect badly on the Johnson administration.

    For instance, Duffy discovered a 14-year contract with the Toronto port authority that basically had Rochester paying for Toronto's terminal. Who knew? Not the community. (Undeniable truth.)

    The city, of course, doesn't get off scot-free. City Council will be asked to withdraw $9.5 million from its limited reserve to liquidate the operation and pay creditors. If the $40 million boat is sold for $20 million — that's the basement price — the city will have to make up the difference.

    But this decision, as the mayor said, stops the bleeding. Another season would leave more losses and, at the end, the same problem only deeper, only worse.

    As a gleaming symbol of promise, the ferry worked. As a business, it was a failure. Duffy looked past the promise to the business, and he made the right call.

    Which drama queen died and passed the tiara to THESE guys?  "The assumptions were built on hope.." and "As a gleaming symbol of promise, the ferry worked." Break out the Wellies, boys; it's gettin' deep in here.

    It was never the ferry 'hope' or the ferry 'promise'.  It was the ferry 'business'.  Any other half-hearted stab at defining what the ferry was supposed to be is pointless and gutless.  When tens of millions of dollars are involved, flowery sweet sentiments are best left to church prayer groups and manic-depressive workshops.

    The D&C editors had the same opportunities to rationally and realistically look at the ferry project as anyone else.  Instead, they gushed enthusiastically about how Happy Days Are Here Again and maintained the ferry could work up until the very last days.  The D&C had control of the only soapbox in town and could have just as easily skewered the idea from the first days of CATS as I did.  Their staff, such as writers Mark Hare and Ben Rand, pumped the pulp with saccharine platitudes of the joys of lake cruising and visions of some sort of morale boost even in the face of utter failure.

    Even the progressive (by Rochester standards anyway) City Newspaper waxed eloquently about how the ferry would be a boon to the Rochester and surrounding areas.  Editor Mary Anna Towler prattled on glowingly of the ferry and offered more They Should's than They Shouldn't's.... as in "They shouldn't be pursuing a dead route which doesn't have enough demand".  Towler has written only one article about the ferry since December 21, 2005 -- which basically droned on endlessly about the sanctity of 'marketing campaigns'. 

    Initially, City Newspaper was hurling the confetti with wild abandon when the ferry's outlook rose, then fell, then rose again.  Since the ferry was thrown into ICU, Towler retreated and kept mum on the ferry progress... possibly because even she could read the writing on the wall.

    Now that the life support has been switched off, look for City to stick to its guns and slam... somebody... about how better promotion would have been the needed salvation to keep the service alive.  That's complete crap of course; there's scant little which would have compelled Torontonians and Canadians to consider dropping on down for a day or two in the Homicide Capital of New York State.


    As for me, I found today's drive up and back from Toronto to be pretty routine.  Clearing Customs in both directions took less than a grand total of two minutes and even the slowdowns around Ford Drive kept moving along nicely.

    Looks like the local QEW haters will have to decide between bus or rail for the next trip now that their joy ride's been torpedoed.

    A cynic's dream come true:

    WROC 8 Rochester HomepageHovercraft proposal still alive
     

    1/11/2006 10:00 PM
    (Rachel Barnhart, WROC-TV)

    Mayor Bob Duffy says if a private company wants to start a Rochester-Toronto ferry service, he's all for it. For the past two years, News 8 Now has been following a company that's been waiting to step in, should the ferry flop.

    Mark Chapell, of Hover Transit Services, long ago predicted the fast ferry would be a fast money-loser. He encouraged the previous City Hall administration not to buy the ferry, and to allow his company to pick up the pieces. His company did not get a warm reception.

    Chapell, of East Rochester, proposes a hovercraft. It's a cross between an airplane and a boat, and can travel up to 80 m.p.h. Chapell says it would use 80 percent less fuel than the ferry, tickets would cost about $10 less, and it would get to Toronto in little more than an hour - twice as fast as the ferry.

    "It's going to carry about 100 to 140 people, 10 to 12 cars and do it in an hour," Chapell said.

    WROC 8 Rochester Homepage

    What do you think of Mayor Duffy pulling the plug on the fast ferry?
    Poll Results
    18% It's about time!

    11% It's sad to see it ago, but I agree the service should stop.

    12% It's a bad decision for Rochester.

    59% Unsure

    Perhaps the best selling point in a ferry-weary city is that the $10 million hovercraft would be privately-funded. Chapell says HTS has lined up half of the financing it needs.

    "The business model is hands down better than the fast ferry," Chapell said. "Ours is the true fast ferry."

    Chapell says HTS would need the city to commit to modest infrastructure improvements at the terminal and the port. (Sounds familiar.)

    His biggest immediate challenge appears to be getting an audience with Mayor Duffy. "We desperately want to get in front of Mayor Duffy personally and discuss with him in private or public what our plans are."

    City Hall did not return a call for comment Wednesday.

    HTS would like Toronto to serve as a hub for several of its routes around Lake Ontario and Lake Erie, which would be used for cargo only. The company envisions using five hovercraft for its routes.

    Chapell says once HTS gets the green light to run the ferry between Rochester and Toronto, service could start within 18 months. The company would have to build the vessel. (Ditto.)

    To learn more about hovercraft, click on the link below.

    Related Link:
    http://www.jameshovercraft.co.uk/hover/m...

    Could it be?  Have we finally answered WHY there's a need for a maritime link from Toronto to Rochester?  Is a hovercraft the magic spell we've all been waiting for?  Bring it on, I say!!  Let's not be content with merely being regional Gullibility Chumps;  let's go for the International Cup.

    "What do you think of Mayor Duffy pulling the plug on the fast ferry?"

    59% were "Unsure".  Proving once again, there's no such thing as a stupid question -- but Lord Have Mercy, some of the responses show a frightening lack of intellectual prowess.

    WROC 8 Rochester HomepageMayor Duffy "surprised" about deal with Toronto Port Authority
     

    1/11/2006 6:00 PM
    (Cathy Orosz, WROC-TV)

    "It was not widely known by me," Rochester Mayor Bob Duffy said Wednesday about a deal the previous administration struck with Toronto's Port Authority.  "It was not part of any briefing that I had."

    But Duffy is getting up to speed quickly on a deal that still has the City of Rochester paying a quarter million dollars a year for space at Toronto's Terminal.  An official with Toronto's Port Authority says the fee is nothing more than a property lease based on a certain cost per square foot. 

    "Quite frankly we're quite surprised that there's this buzz about it," said the Port Authority's Chief of Operations, Ken Lundy.  "It's a commercial lease that's in place." 

    Above and beyond that, the City was also paying a fee for each passenger and car coming out of Toronto. 

    "That is actually common," said Lundy.  "We charge that within the Port of Toronto to other users and it goes to harbor maintenance costs." 

    The deal amounted to hundreds of thousands of dollars for Toronto; a city Duffy says was already raking in more ferry revenue than us.

    "Their hotels, their restaurants, their theaters are benefiting.  I think that's benefit enough," said Duffy.  "I guess what I would question, why are we going to pay and keep paying extra?" 

    Officials from the former administration are on the defensive.  The City attorney who helped negotiate the deal says it was "very much known." 

    "The Mayor spoke about it several times in public," said former Corporation Counsel, Linda Kingsley.  "It was not a secret deal." 

    Lundy agrees.  "I'm still sort of taken back that there seems to be some idea there's a smoking gun in all of this," said Lundy.  "I can assure you there is not.  All deals were on the up and up.  All deals were negotiated in a fair manner." 

    How can the City get out of the deal?  The Toronto Port Authority is planning to meet with Duffy's administration and hammer out a solution.  Both sides have talked, but so far there's no firm date for a meeting.

    "Their hotels, their restaurants, their theaters are benefiting.  I think that's benefit enough," said Duffy. 

    OK.  That's one way of looking at it.  Another might be that Toronto really never benefited all that much and the city needed to have a source of revenue from the ferry company itself to ensure the deal was semi-profitable for the GTA.  Sort of a insurance policy.

    It's hard to imagine the King Edward was selling out of rooms due to the crush of ferry passengers flooding the streets.  I don't think the Novotel at The Esplanade had to hire extra staff to deal with the Louis Vuitton-toting tourists from Rochester.  The Spaghetti Factory didn't seem to have lines snaking along the sidewalk during the times the ferry pulled into the Port of Toronto.

    In short: the benefit to Toronto was marginal at the very best.  Slamming a $250,000 'rental fee' To next page along with a per-head charge may have been the biggest chunk of 'benefit' Toronto saw.  We'll never know.