Steamship Authority Proposes Largest Fare Increase Ever

After a summer of turmoil that included crew shortages resulting in cancellations and reduced service to Nantucket and Martha's Vineyard, the Steamship Authority is proposing its largest fare increases ever to cover higher wages and benefits for employees, along with increased maintenance and information technology expenses.

The proposed rate increases were unveiled Tuesday morning during the Steamship Authority's Port Council meeting, and would help cover a projected $5.49 million net loss from the boat line's operations in 2025.

"This is the largest rate increase ever - let's come out and say it, let's just rip the bandage right off and talk about it - and the biggest driver on the expense side is the payroll expense we're talking about," said Mark Rozum, the Steamship Authority's treasurer and comptroller. "We're looking at the payroll expenses of keeping extra ABs (able bodied seamen) on the boats, training them, for example, to become pilots and captains. That's a real cost. We're looking at wage increases of 10 percent in year one."

The proposed increases would affect nearly all fares except passenger tickets on the slow boats. Fast ferry tickets and most standard vehicle fares, including excursion fares, would increase by roughly 10 percent. Rates for freight trucks longer than 20 feet would rise by 12 percent, while parking permits in Hyannis would be hiked between 18 percent and 25 percent. Below is a breakdown for the rate hikes on the Nantucket route:

The Steamship Authority’s initial 2025 budget has been set at $152.8 million, 
an 11 percent increase over the 2024 budget or a $15.2 million rise in the cost of service.

The biggest drivers of the proposed fare increases - payroll expenses and IT costs - have been two of the Steamship Authority's most significant problems over the past year. A shortage of deck officers and a contract dispute with their labor union led to reductions in service, boat swaps, and cancellations over the summer. Meanwhile, the Steamship's aging IT infrastructure has created website meltdowns and massive headaches for customers attempting to make reservations.

But as Nantucket's representative on the Port Council pointed out, the fare increases may not necessarily fix those issues or create a better experience for those riding the Steamship's ferries. 

"We’re squeezing money out of the same stuff, to give you the fast, non-college answer," said Nat Lowell. "We’re squeezing money out of what has no choice but to come here...People are going to be complaining about the service for the price. Are we going to get improvements to the service for the price? That’s something we have to be cognizant of with the service and the employees. It's hard for us to be different just because it’s costing more. That’s a huge problem we’re going to be facing. People expect more, better service, better overall treatment and experience, whatever you want to call it. We need to try to fix that. But it’s going to take time." 

The rate increases would raise an extra $10.2 million on the Martha's Vineyard route and $6.1 million on the Nantucket route, a split which Rozum explained in a memo to the Steamship Authority general manager and board.

"With the proposed distribution of rate adjustments by route, total revenues (and other non-service income) are expected to be split 57.4 percent for the Martha’s Vineyard route and 42.6 percent for the Nantucket route," Rozum stated. "By comparison, the cost of service for each route is projected to be 61.2 percent and 38.8 percent, respectively."

The Port Council did not vote on the proposed fare increases on Tuesday. The rate hikes will be presented to the Steamship Authority's Board of Governors later this month, and the boat line is planning workshop meetings on the islands and on Cape Cod during the week of Oct. 23.