Saturday, February 4, 2023

Utilities commission will regulate entire ferry system, calls assets “de facto monopolies”

The Bald Head Island Transportation Authority is working to acquire the island's multi-million dollar, privately-owned ferry system. (Port City Daily photo/Johanna Ferebee)
The North Carolina Utilities Commission decided in favor of regulating the Bald Head Island ferry’s parking and barge operations on Dec. 30. (Port City Daily photo/Johanna Ferebee).

BALD HEAD ISLAND — The North Carolina Utilities Commission has asserted its authority over Bald Head Island’s parking and barge operations, half of the island’s ferry system.

Handed down on Dec. 30, the commission determined the parking and barge regulations will be in “furtherance of the public interest.” However, its scope and degree of that regulation will be decided upon at a later date. 

READ MORE: Bald Head Island ferry selling to private company after public deal stalls

Due to the NCUC’s ruling, owners of the ferry system will most likely need NCUC approval to raise rates on the parking and barge operations, as is already required for the ferry and tram.

The verdict brings a five-year saga surrounding the ferry’s regulation a major step closer to the finish line. 

In February 2022, the Village of Bald Head Island filed a complaint with NCUC to determine if the NCUC should oversee the parking and barge. The move came after years of efforts to transfer the system to a public entity, the Bald Head Island Transportation Authority. Owner Bald Head Island Limited tired of waiting for the deal to pan out and announced it was selling the system to private company SharpVue Capital in May 2022. 

NCUC still needs to approve the transfer of the ferry assets to SharpVue. After doing so,, if SharpVue decides to increase rates, it will be required to submit its case to the commission for each ferry component.

Bald Head Limited’s CEO Chad Paul and Bald Head Island Mayor Peter Quinn did not respond to PCD’s requests for comment by press. SharpVue’s co-founder Lee Roberts refused to comment due to the ongoing NCUC case to confirm the system’s sale. 

In June 2022, Paul told Port City Daily SharpVue had no plans to overhaul the ferry system.

“They’re going to take the current rates, they’re going to take the current schedule, they’re going to take the current lease for the real estate,” he said.

Roberts confirmed as much, also certifying the company plans to retain current staff. At the time, the only major change Roberts shared with PCD was plans to simplify the ferry’s ticketing process, moving to an online system where riders make reservations in advance. They also will receive one unified ticket for ferry and parking.

“It’s privately owned and publicly regulated now. If our deal is approved, it will be privately owned and publicly regulated in the future,” Roberts said in June. “I don’t think the public should be concerned on that front.” 

However, the NCUC’s ruling sided with Bald Head Island’s claims that the ferry operation is a monopoly, and the consumers must be protected from indiscriminate rate increases and fees from the private company. 

NCUC stated the parking system — 40 acres of 2,302 parking spaces divided into general, premium, contractor and employee lots — is essential to traveling on the ferry. 

The NCUC order reads: “A significant number of persons would choose not to travel to the Island were they not able to access or use the Parking Facilities. Ferry ridership is dependent upon, and would noticeably decline but for the operation of, the Parking Facilities.”

The order notes there is no reasonable public alternative to the parking facility at Deep Point Terminal, which charges $12 for a general ticket. Property owners may purchase a general lot annual pass for $1,100 or premium lot annual pass for $1,350. Contractors can purchase an annual pass for $700.

NCUC also demonstrates how the barge operation is essential to the ferry service. Dubbed “Brandon Randall,” is a 100-foot by 32-foot steel deck barge that can carry up to 200 tons of cargo. It is pushed by tugboat, “Captain Cooper,” five days per week transporting vehicles, cargo and a limited number of passengers.

The barge transports all food and beverage sold on the island; restaurant and club supplies; commercial goods and materials sold and used on the island; construction materials and equipment; large household goods (e.g., appliances and furniture); housekeeping, administrative, and office supplies; fuel; landscape materials; golf carts used on the Island and more. 

Emergency services and mail deliverers also have to use the barge. NCUC states the vessel is the “lifeblood” to construction on the island, with the schedule dictating building, inspection, and real property closing schedules.

The ferry system charges $60 for each 6-foot-long by one-vehicle width or lane area. 

NCUC cited public desire for regulation as another contributing factor in its decision. 

“Public sentiment from Island stakeholders strongly emphasizes the importance of a unified transportation system serving the Island and the need for regulatory oversight,” reads the order. 

Both the Bald Head Association and Bald Head Island Club intervened in the case on the side of the village. In August, the former released a poll for Bald Head Island residents asking if the parking and barge should be regulated; 71% voted yes and 15% said no.

The ferry and tram have been regulated by the NCUC since 1993, before the parking and barge services were included in the finances of the ferry system. Since then, rates have increased once in 2010. Adult round-trip tickets for the ferry are $23.


Reach journalist Brenna Flanagan at brenna@localdailymedia.com.

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