Economics favour fixed link over ferry

Letter to the editor Coast Reporter:

Editor:

In response to your Sept. 25 editorial, “Fixed link a diversion,” I feel Mr. Gleeson has ignored the basic economic facts that make a fixed link not only possible but likely.

From the 2014-15 Annual Report to the British Columbia Ferries Commissioner, the cost to operate our route, for the fiscal year ending March 31, 2015, was $40.7 million. Over 20 years, we will spend upwards of $1 billion just to operate our ferry ($800 million plus cost increases and inflation). Add to that the (estimated) $200 million to be spent on Horseshoe Bay upgrades in 2018 and the (estimated) $300 million to replace our ferries, we are looking at $1.5 billion spent on our route over the next 20 years. Worse still, the ferry will continue to cost tens of millions of dollars to operate every year after that.

Our ferry costs $2.05M/year/km just to operate and maintain. If the Ministry of Transport had to spend that much on highway maintenance each year, their annual budget would be some $96 billion (MoTI covers 47,000 km of roads) – more than double our current provincial budget.

A fixed link is a capital asset with a 100(+)-year life span. Its cost will be amortized over a period of time (usually 20-25 years). After the costs are recovered over that amortization period, the link becomes a revenue generator, allowing the revenue to be used elsewhere (create a fund for Sunshine Coast communities, for instance), or the tolls reduced – something our ferry route will never be able to do.

Ryan Medd, Gibsons

– See more at: http://www.coastreporter.net/opinion/letters/economics-favour-fixed-link-over-ferry-1.2074530#sthash.WWkDfo9Q.dpuf

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