Whatcom County Public Works is proposing an increase to ferry rates in 2023. Please review the following information to learn more about the operational mandates that guide these decisions.
Background on Farebox Recovery Rate
Out of Compliance with County Code
Changes in Ridership Patterns & Operational Costs
Link to Proposed 2023 Ferry Fare Ordinance
Link to Relevant County Code
Timeline of Ferry Fares
Budget Documents & Reports
Frequently Asked Questions
Beginning January 1, 2006, a 55% ‘farebox recovery rate’ was established for the Whatcom County ferry system (with the ordinance codified in Whatcom County Code 10.34.030). Essentially, the code requires that 55% of the operational costs for running the ferry system be borne by the system users, and the remaining 45% be borne by Whatcom County property taxes. Alongside this farebox recovery rate, the code mandates an annual review of ferry system services, actual & projected operating costs, and actual & projected revenue from ferry ridership to ensure that fares are set at the level needed to cover 55% of the costs.
In keeping with the mandates outlined in 10.34.030, Whatcom County Public Works completes annual reviews of ferry system operating costs and services. Recent annual reviews show that drops in ridership paired with increased operating expenses have resulted in the ferry system operating out of compliance with the mandated farebox recovery rate.
Like many businesses, organizations, and government entities did during the pandemic, Whatcom County pressed the ‘pause’ button on making any increases or substantial changes to the fare system in hopes that operational costs and ridership patterns would stabilize after COVID mandates were lifted. Unfortunately, this has not been the case. Waiting any longer will result in larger fare increases and potential cuts to service levels. Public Works is mandated to ensure that the ferry system complies with Whatcom County Code.
A review of ridership data shows that the ferry system experienced peak ridership and farebox revenue in 2018. The minor decline in 2019 was eclipsed by the COVID-19-related 25% ridership drop in 2020. Ridership has been slow to rebound, resulting in farebox collections that do not support their share of ferry operations expenditures. Annual farebox collection excess or deficit is tracked and maintained as a cumulative total. The cumulative farebox deficit for the end of 2021 was $142k. Currently, 2022 is projected to grow the deficit to $730K.
Operational expenses have also steadily increased. Inflation has affected expenses such as fuel costs, wages, maintenance fees, and contracts.
Without changes to the fare structure, the projected ridership for 2023 only supports $3.0M of the expected $3.9M in budgeted expenditures--which will continue to grow the deficit. The projection of continued deficits indicates that we can no longer offer our current level of service at the current fare rate while also attempting to regain compliance with the farebox recovery rate outlined in the County Code.
Simply put, we need to get the farebox recovery ratio back to 55%/45% as mandated in the Whatcom County Code. Whatcom County Public Works is required to operate the ferry system at this farebox recovery ratio, where 55% of the expense is borne by the ferry users and the remainder is borne by the County. In order to accomplish this and maintain our current level of service, Whatcom County Public Works is proposing to increase ferry fare rates in the spring of 2023. This proposal represents the first substantial increase in fares for operational costs since 2011.
Click here to view the proposed ferry rates. (Updated 01/10/23)
The Whatcom County ferry system will continue to offer users multi-ride discounts, at a reduced discount, as well as needs-based fare discounts.
(Updated 01/09/23--The Ferry Operations Report was updated in early January 2023 to incorporate the most current ridership and expense information for the included 2022 projections.)
(Updated 01/09/23--Updated based on changes to the Ferry Operations Report above. This is a standalone copy of 'Exhibit B' included the Ferry Operations Report.)
Why do fares need to be increased?
Ferry fares need to be increased because we are out of compliance with Whatcom County Code 10.34.030 which requires a 55% farebox recovery rate. We cannot continue to operate out of compliance.
What Whatcom County ordinance discusses ferry fares?
What does ‘farebox recovery rate’ mean?
“Farebox recovery rate” means the calculated percentage of total revenue generated through ferry user fees in comparison to total actual operating costs for the same period of time minus any revenue from the motor vehicle fuel tax meant for ferry operations, or from interest.
Essentially, ferry users are expected to participate in paying for ferry operating expenses. The farebox recovery rate sets fare collection so that it covers 55% of ferry operating expenses.
What is the farebox ratio for ferry users in Whatcom County?
The farebox ratio for ferry users is 55%. This means ferry user fee rates need to be set to cover 55% of operational costs. Whatcom County property taxpayers cover the remaining 45%.
What makes up the ‘operating costs’ for the ferry system?
“Operating cost” means all actual daily running expenses (which include fuel & wages), and all actual regular & routine maintenance and administrative expenses associated with the use and operation of all physical elements of the ferry system.
What other revenues fund the ferry service besides user fares?
Operating funds are generated through fares, state subsidies, and the Public Works Road Fund. No capital expenses are funded through or included in operations. Capital expenditures are paid by the Public Works Road Fund and grants.
What is the process for increasing ferry fares?
Whatcom County Public Works brings ideas and proposals to the Lummi Island Ferry Advisory Committee for discussion. To pass an ordinance to increase fares, a draft ordinance will be sent from Whatcom County Public Works to the County Council. The ordinance will be introduced on the Council’s calendar (tentatively set for January 10, 2023) and then up for public hearing at the next Council meeting (tentatively set for January 24, 2023). After public input and discussion, the County Council will vote on whether or not to pass the proposed ordinance changing the fee structure.
What date will the fare increases take effect?
It is anticipated that the fare increase would take effect in spring 2023, subject to Whatcom County Council approval.
Will there be any reduction in ferry service?
Our fare proposal is designed such that with ridership similar to 2022, we can return to farebox compliance for 2023 without service reductions. If the increase does not pass, a service reduction is one of the tools we may use to balance operating costs.
Will there still be multi-ride/punch card discounts?
Yes, there will still be multi-ride punch card discounts though the discount structure has changed. Now 10-ride and 25-ride passes will have the same discount percentage applied. There will no longer be a larger discount for the 25-ride cards. The discount would be 15% for both 10-ride and 25-ride.
Will there still be needs-based fares?
Yes, there will still be needs-based fares.
Is this fare increase related to the new sea wall recently completed at the Lummi Island Terminal?
No, the new sea wall (breakwater) was a capital project and funded as a capital expenditure. The project was not paid for with operating funds. See the Lummi Island Breakwater Replacement Project page.
Are you increasing fares to fund the new ferry?
No, this fare increase is not funding the new ferry. This fare increase is to fund the current operating costs of the Whatcom County ferry system, in compliance with the farebox recovery rate outlined in Whatcom County Code 10.34.030.
Will I still have to pay the $1 ferry capital surcharge?
Yes, the $1 ferry capital surcharge remains in effect. Ordinance 2021-147 was approved by the Whatcom County Council on March 23, 2021, establishing a capital surcharge on most ferry fares. This money is used exclusively toward the purchase of a new ferry and to make modifications to both ferry terminals. Click here to read more about the capital surcharge.
How do I keep up with ongoing discussions about ferry operations?
The Lummi Island Ferry Advisory Committee provides a forum for those who depend upon Lummi Island ferry service to voice their ideas and concerns about the ferry service. In-person-only meetings are generally held on the second Wednesday of each month at 6:00 p.m. at the Lummi Island Grange. Sign up to receive an email or text message announcing meetings, agendas, and other information: https://www.whatcomcounty.us/list.aspx?ListID=480
The 2023 Ferry Fare Proposal was introduced at the Whatcom County Council meeting on January 10, 2023.
The ferry fare proposal will tentatively be scheduled for a public hearing at the Whatcom County Council meeting on January 24, 2023. Check the meeting agenda to confirm. This is a chance for any citizen to voice their opinion on the proposal.
Published 12/1/22; Updated 01/11/23