A $41 million proposal for Casco Bay Lines to build a new 500-car parking garage and take over the existing ferry garage has been made by two members of the board that sets policy for the ferry service.

The plan includes Casco Bay Lines leasing the Maine State pier, now controlled by the City of Portland. In addition, the idea calls for a new, 15,000-square-foot transportation terminal (including bus), improved freight handling capabilities for Casco Bay Lines, space for the Portland Harbor Museum and a training/conference center.

Two of the proponents, Chris Hoppin and Frank Peretti, are members of the Board of Directors for the Casco Bay Island Transit District (CBITD), which owns and operates the ferry service. The third proponent is Steve Macisaac.

Peretti indicated that the proposal would be financed by federal and state grants. He also stated that the project was not intended to expand CBITD into the “parking business,” but to meet islander needs and provide the ferry service with revenue. 

According to a presentation made by the three Peaks Island residents at the transit district’s April 17 board meeting, the project’s purpose is to “focus on a possible way out of CBITD’s increasing cost spiral by generating additional sources of revenue.” The proposal’s objectives are to create adequate parking for every island resident, plus surplus parking spaces to rent to the public and increased ferry ridership.

The cost of the $41 million proposal includes:

         *$7 million to purchase the terminal parking garage;

         * $10 million to lease part of the Maine State Pier;

         * $11.6 million to build the new parking garage;

         * $9.4 million to build the multimodal terminal.

The plan would be carried out in three phases with the first costing $19.4 million starting in 2010, the second costing $21 million starting in 2012 and a third costing $1 million staring in 2014. The first phase includes purchase of the existing garage and the MSP rental. The second phase would finish the new garage and terminal, and the final phase is development starting in 2014.

Catherine Debo, general manager of the transit district, has started the funding process by submitting a “two-page place holder” with the Maine Department of Transportation for “Congestion Mitigation Air Quality” federal funding. This means that this project could be considered for funds from the current state budget cycle as opposed to a two–year wait for the next cycle. She indicates that this is only a small source, and that other revenue sources will be needed.

Debo also said that it would be necessary to develop a detailed business plan to determine all costs and revenues before seeking the needed grant money. It is often necessary when receiving state and federal grants to be required to obtain a percentage of the funding (typically 15 percent) through transit district borrowing. Debo also mentioned the need to coordinate efforts with The Olympia Companies, which was selected by the City of Portland as the developer of the part of the Maine State Pier not presently occupied by CBITD.

The proponents forecast an increase in ferry fare revenues of $570,000 (a 25 percent gain) resulting from the added parking capacity. They project net income in 2012 from the garages to be $520,000 from the existing, 400-space garage and $1.3 million from the new, 500-space garage.

According to John Peverada, manager of Portland’s Parking Division, the city’s net income from its 50 percent ownership the existing garage in fiscal 2007 was $219,199. This represents significantly less than half of the net income, because of the cost and revenue formula in the original public/private project. Costs were split 51 percent/49 percent private/public, but private revenue included the first 50 hourly parkers every day as well as 51 percent of all the rest. The current private partner, a Massachusetts partnership called MHR, purchased its share of the garage from the original private partner, Casco Bay Garage Associates, in 2007 for “somewhat more” than $6 million, according Peverada.

Portland City Councilor Kevin Donoghue, the city’s representative on the transit district board, noted that part of the original garage agreement gave the right of first refusal to each party. This means that both the City of Portland and MHR would have to be willing to sell. Donoghue, a member of the Council’s Transportation Committee, said that the transit district needs to look at many options. He would prefer a solution that would reduce the demand for parking.

At the May 15 board meeting, it was voted to form a working committee to study the idea. The three members are Hoppin, Peretti and Macisaac.