Operator of passenger ferry service to Friday Harbor files to suspend operations for 2022 season

Citing financial losses that would stem from recently changed Coast Guard capacity rules, the operator of MV San Juan Clipper has filed a petition with the State of Washington to temporarily suspend operations in 2022.

San Juan Express, Inc., filed the petition with the Washington Utilities and Transport Commission last week. It would eliminate the company’s four day per week service between May 12 and Sept. 5, as well as its three day per week service between Sept. 9 and Oct. 9 in the fall.

The company has also reportedly begun cancelling reservations for its three day per week spring service, although it does not mention that approach in its petition. Spring service is scheduled to start next Friday.

“SJE had hoped, bolstered by a prospective fuel surcharge, to continue operations at an increased capacity of approximately a 200 passenger limit, to resume service and attain modest profitability in the 2022 sailing season,” according to the petition. “However, in late March 2022 and ironically on the same day of SJE’s pending fuel surcharge submission, the Company’s outside naval architect, Theresa Fielding of the Elliott Bay Design Group, was informed by the United States Coast Guard that apparently due to controlling federal regulations which were revised following a major vessel fire off the coast of California, SJE’s vessel capacity would be limited to 150 passengers for the indefinite future until and unless significant design changes in the vessel were implemented.”

The company states that the regulation change comes too close to the upcoming sailing season for the required modifications to be implemented and then approved by the Coast Guard – although its petition does not cite the specific regulation at issue.

Without modifications, SJE states that the mandated capacity reductions of at least 25 percent would cause the Friday Harbor route to operate at a substantial financial loss in 2022. Those losses could be exacerbated after factoring in likely wage and operating cost increases related to rising inflation.

In the petition the company notes its belief that raising prices in 2022 to compensate for reduced capacity could have long-term negative effects. “[Adjusting] underlying rates to a level necessary on reduced capacity to generate a reasonable operating profit might pose such a risk of rate shock that future seasonal service resumptions could be threatened to the point of jeopardizing the sustained viability of this important commercial ferry route.”

The WUTC will consider SJE’s petition at a public meeting on Thursday, April 28 at 9:30 a.m.

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