BY DAN ROSENHEIM
“We’ve got some reserves but not enough to fund everything.”
Those words, spoken last month by Water Emergency Transit Authority (WETA) Executive Director Nina Rannells, reflect the agency’s predicament as it reevaluates a five-year spending plan in the face of a freeze on funds it had expected to receive from Regional Measure 3. That measure, approved by 53 percent of the electorate in a June 2018 vote, would have provided the ferry agency with several hundred million dollars in direct funding and bonding power over the next few years.
But a continuing legal battle over RM3, which has moved to an appellate stage that might last several years, means that WETA can’t count on the money. Although toll hikes on eight Bay Area bridges are taking place as planned, the new funds are being paid into an escrow account until the litigation is resolved.
Meanwhile, though, demand for ferry service continues to grow—from communities and business throughout the Bay—and WETA can’t wait for a resolution of the RM3 case to make major decisions about its expansion plans.
Accordingly, in response to a request from Jody Breckenridge, WETA’s chairperson, directors and staff spent a large part of the agency’s October board meeting examining how far existing funds will go—a process that ultimately could establish what gets funded and what gets cut.
Rannells and WETA’s finance and administration manager, Lynee Yu, told the board that projected revenues from passenger fares and existing subsidies should be enough to cover the agency’s operating costs, including maintenance and replacement of aging vessels and other infrastructure, for the next five years—even leaving a healthy reserve for unforeseen expenses.
But difficult decisions face the board with regard to expansion. Currently, WETA has four significant projects that are either underway or require imminent action. These include:
- Seaplane Lagoon: Ground was broken last month on a new ferry terminal scheduled to go into service next summer at Alameda’s former Naval Air Station. Eventually, commuters on the new route will include residents of a giant new Alameda Point development that will bring thousands of new residents and employees to the area. But the development is in its early stages, and the type of service WETA will provide initially remains to be seen. WETA Planning and Development Manager Kevin Connolly told the board that options under consideration range from a three-trip daily peak period service that would draw from existing resources to six-trip daily service that would shift peak-period runs to Seaplane from the existing Alameda Main Street terminal. The latter plan, under which WETA would have entirely separate runs from downtown San Francisco to Oakland and to Seaplane, would require a new boat and add a lot to the annual operating budget—$16 million over five years—but it would provide full service to Seaplane while cutting the time for an Oakland-San Francisco commute by a third.
- Mission Bay: Regular shuttle service between downtown San Francisco and a new Mission Bay terminal is scheduled to begin in January 2022. The Port of San Francisco has asked WETA to provide $25 million toward the roughly $50 million cost of a new terminal in Mission Bay—money that WETA had expected to get from RM3. The port has indicated it might advance the money against WETA’s promise to reimburse it if RM3 funds become available, but the new service will also require money for a vessel and new annual operating funds.
- Treasure Island: Although developers won’t divulge their plan for the ferry service they hope to have in 2021, WETA is proposing a July 2022 start date for its own small ferry service between the island and San Francisco. The cost for a small boat would be comparable to Mission Bay, as would the cost of operations. Effectively, WETA would spend about $10 million to buy three small boats that would split service between the Treasure Island and Mission Bay runs, depending on demand.
- Fleet Expansion: WETA’s existing agreement with Mavrik Marine, which will deliver a new high-speed, 300-passenger vessel next spring, gives the agency an option to order a second vessel for $15 million, but that option needs to be exercised this year.
Each of these projects has great appeal and timeliness, and board members and staff agree that some of this expansion can be accomplished even without RM3 monies. The rub comes in deciding precisely how much can be done—and what gets left behind.
The October board meeting discussion was not definitive in either regard. No votes were taken, and Rannells said that cost projections by her planning department need to be reviewed by the operations side. But the discussion seems likely to continue when the board meets in November, and it could get contentious, with part of the debate focusing on how much spending is prudent, regardless of where it goes.
On this issue, Rannells, Breckenridge and board member Anthony Intintoli appear to lean toward a more conservative approach. “We’re in a good place in part because we have been prudent and not overspent,” Rannells said. “We just can’t do all of these without RM3 or additional monies from some other source.”
In the case of Seaplane Lagoon, for example, the ultimate plan is indeed to provide better service to Oakland using the existing runs with fewer stops at Main Street, and other direct runs to Seaplane. But Rannells said she wasn’t sure the Alameda Point development project near Seaplane Lagoon will produce enough new riders to support such a plan right away.
“Ridership will grow,” she said, “but there won’t be a lot at first. If RM3 were here, we’d go ahead full speed and no problem. But it’s a big hit of money that we just don’t have sitting in the bank.”
That sentiment was echoed by Intintoli, who told WETA’s September board meeting: “I’m excited by this project, but money is an issue. How do we fund this if ridership is not at the level we need?”
But there are also those who believe the RM3 litigation can’t be allowed to delay projects that are badly needed—and, in some cases, already committed to. Board member Jeff DelBono, an Alameda resident, spoke forcefully in favor of a full commitment to Seaplane Lagoon. Referring to the concern that there may not be enough passengers to justify expansion, DelBono said, “Alameda doesn’t have a farebox recovery issue. We have a boat availability issue.”
DelBono’s view was echoed recently by Debbie Potter, Alameda’s community development director, who told WETA’s board, “I believe the success of the ferry is going to be pretty immediate once service starts.”
Even if fare revenue were modest to start, one school of thought holds that this is not the time for WETA to take a go-slow approach, even if it means borrowing, or pressing the Metropolitan Transportation Commission for new subsidies that don’t come from RM3.
For those who embrace that perspective, it’s unthinkable that WETA won’t push ahead with all four projects currently on the table. Not running ferries to Mission Bay is not an option, given the presence of the Chase Center and the University of California at San Francisco in Mission Bay. Not running the ferry from Treasure Island is equally untenable—it’s maritime transit for a major new community in San Francisco and thus part of WETA’s purview. And the new boat from Mavrik will be needed for all this expansion.
Furthermore, the list doesn’t end here. Not part of the five-year financial plan, but very much in the longer-term picture, are proposed WETA terminals in Redwood City and Berkeley, possible ferry support to a new Oakland A’s stadium, possible small ferry boat runs to Martinez, Hercules and even Antioch, and the feasibility study for hovercraft.
“I just visited the waterfront area of Hercules, and we heard recently from Martinez,” WETA Vice Chair Jim Wunderman told the board meeting. “I can see a pattern where we start talking seriously about more relief to the I-80 corridor and Carquinez Strait.”
The November WETA directors meeting should shed additional light on the board’s thinking. Meanwhile, though, all of this assumes that WETA’s fares continue to increase incrementally each year and that the economy remains healthy.
As his comments above suggest, Wunderman has been a consistent proponent of growth for WETA. But even he noted this month that an economic slowdown could put brakes on ferryboat expansion. Fewer people working, he said, would mean fewer commuters. And if highways aren’t as crowded, some people may move back into their cars.
Dan Rosenheim is a veteran Bay Area journalist who recently retired after 18 years as Vice President/News for KPIX-5 TV. Prior to going into broadcast, Rosenheim worked as a reporter, city editor and managing editor at the San Francisco Chronicle. Dan and his wife, Cindy Salans Rosenheim, live in San Francisco.
 Dan Rosenheim is a veteran Bay Area journalist who recently retired after 18 years as Vice President/News for KPIX-5 TV. Prior to going into broadcast, Rosenheim worked as a reporter, city editor and managing editor at the San Francisco Chronicle. Dan and his wife, Cindy Salans Rosenheim, live in San Francisco. |
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