Dexter pledges $21M to restart Yarmouth ferry

Nova Scotia Premier Darrell Dexter is pledging $21 million over seven yearsto help restart a ferry service between Yarmouth and the United States.

Dexter made the announcement after an expert review panel released its findings on the viability of the service.

But the panel said this won't be smooth sailing.

"There is a great deal of uncertainty," said Peter Nicholson,a member of thepanel. "It's a risky proposition."

Nicholson said there's increased competition for tourists so the service needs a new approach. The panel is suggesting a 'cruise' ferry. The ship would carry passengers and vehicles, but the service onboard would offer extra amenities such as a dining room, spa or a casino.

"That kind of a business model gives you the chance to attract larger passenger numbers," said Nicholson.

The panel said passenger traffic must increase significantly.The service would need at least 130,000 passengers a year to become commercially viable,they said. When the service ended in 2009, there were 75,000 passengers a year.

"There is a good prospect it could become viable," said Nicholson. "The panel would not make a recommendation on a service that required an on-going subsidy." He specifically pointed to Portland, Maine as the link on the American side where the panel believes this project wouldhave the most potential.

The report also said the service would not break even until its seventh year, when it would earn a modest profit.

Nicholson said it would take aggressive and effective marketing to make theroute a success.

Province to invest

Dexter immediately accepted the report and said the province will look for expressions of interest from the private sector to be the new operator of the service.

"I believe that it correctly lays out the conditions under whicha successful and profitable service from Maine to Yarmouth could operate," he said.

The Premier was quick to defend his government's decision to end the old subsidy in 2009.

"The decision to end the CAT ferry and instead seek to establish a viable service was the right one. It was a difficult one for the people of Yarmouth. A ferry link to New England is an important part of their history," he said.

Dexter said the report paves the way for a successful, profitable and stable service. But he added the federal government will have topitch into upgrade the ferry terminal in Yarmouth.

"The province cannot do it alone this time," he said.

Dexter also called on municipalities and businesses to back the project.

Thepanel estimated the federal and provincial governments would have to cover between $30 million and $35 million worth of support to restore the terminal and cover start up funds.

The ferry, which started its run in 1997, was able to carry 900 passengers and 240 vehicles. It ran every day in the summer and five days a week in the spring and fall shoulder seasons.

The NDP government cancelled a $6-million subsidy for the service in 2009. That decision sparked protests.

Yarmouth depended on the ferry service to deliver American tourists to the area.

In 2011, the 65-roomRodd Colony Harbour Inn in Yarmouthclosed its doors after 40 years of business.The chain cited the town's failure to secure a new ferry operator as the main reason for the closure.

Friday, Yarmouth's Mayor Phil Mooney celebrated the reports findings. He's hopeful a new boat can be in the water next year.

"This is great news today for Yarmouth," he said. "Not just Yarmouth, but all of Nova Scotia. I can't wait for that boat to be coming up the harbour."

"We have some ideas of what we'd like to see for a vessel we'd like to see come into Yarmouth from the United States,"he said. "We're looking at a cruise-type vessel."

Cautious optimism

Neil LeBlanc, co-chair of the Nova Scotia International Ferry Partnership, said there is a lot of work that still has to happen.

"We also have to involve the federal government. They have a major role to play also in providing infrastructure and other support," said LeBlanc.

"Obviously the other question here now is, who takes the lead from this point on?We think the province has to be the lead on it, but there's a lot of work that has to happen before they bring a a ferry here."

Since the ferry stopped running, businesspeople in the area like Heather Northuphave had some struggles.

"It sounds good, but show me the money, that kind of thing," she said. "I think people are afraid, they're scared, it's been a long time."