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Season 3, Episode 4 · 2 years ago

Episode 303 - Barely Afloat

ABOUT THIS EPISODE

The Fast Ferry is open for business and taking passengers across Lake Ontario, but cracks are beginning to show. In this episode we go over the short but action packed life of Rochester’s Fast Ferry.

All right, we're going to keep it going. You're listening to here you are season three fast ferry. I'm your host Tom Fleischmann, and to get us going today for our third episode is Mark. Hi, I'm Mark Mahollock. I'll be voicing this episode. Great, and so you're going to tell us about the launch of the ferry. So what did it look like? Well, from the start things are looking pretty good. People were buying tickets. They were pretty highly priced, but everyone was still having a great time on the faery. Things seem to be going really well. Once the spirit of Ontario got onto the water, it was smooth sailing. This first trip was a fund raiser for the Rotary Clubs of Rochester and Toronto. Four hundred and fifty plus people shelled out five hundred bucks a pop to take the first ride. The media was charged two hundred and twenty five a person to pay for services to cover the event. He described the ride smooth, the air smooth, very smooth, very nice, but it wasn't so smooth sailing outside on the deck on this ship nicknamed the breeze. That's awesome and awesome some power mount effort here we come. Oh yeah, in June and July, the fairy had a lot of business. It even had a Canadian on its first round trip voyage, about a hundred and sixty people, but only a few passengers were Canadian, including this man. Hi. Guys in made out especially well during the Independence Day holidays in the US and Canada. People were riding the ferry every day, thousands in fact. By the end of the summer the ferry had served over one hundred and fortyzero passengers, and most of these passengers had a great experience and love the fairy. Behind closed doors, cats face problems on several fronts, and it didn't help that cats's president, Howard Thomas, and CEO Dominic Delucia, both resigned from their position just twenty days after the launch. In their place stepped cornel Martin to stop the bleeding. Cornel Martin, ship expert, steamboat captain, maritime mastermind, political lobbyists, nautical CEO, PR expert. This was the man who cats hoped would save them from disaster. Now, Howard Thomas was a marketer by trade and DELUCIA A finance expert. So two people not really set up for running a ship successfully, and it showed, because cats was having many problems both before and after launch. The two men stepped down to like Cornell Martin, so one with actual nautical experience take charge as president of the company. Cornell Martin would now be the face of cats, representing it to the media and running it from the inside. This wasn't Martin's first Rodeo, though. He had worked with steamboats, tugs, barges and shipyards. He represented maritime into trees in their dealings with the government. Even his master's thesis was about the Panama Canal. This expertise was such that he spoke to Congress about port security in two thousand and three here is part of that testimony. Thank you, miss the chairman. I am Cornell Martin, Vice President of the Passenger Vessel Association, Pva, as the National Trade Association. Types of passenger vessels I remembers. Vessels range from small water taxis carrying less than a dozen passengers to international fairies carrying thousands of commuters. Here that international fairies carrying thousands of commuters. This guy knew what he was doing. When he took charge, he commanded a company that was in shambles at the time. Catch was not doing well at all, suffering from a litany of problems, some outside of its control and other's due to its own incompetence as a company. Once in charge, Martin could get an overview of the entire financial situation of the company. At this point in July, of two thousand and four catches, already three million dollars in debt. Now, anyone who works in business or startups so tell you that this is not unusual. Many companies, including Amazon, lost money...

...for years until they finally became profitable. So, on the surface, not a big issue. It's when he checked the numbers that he realized how bad the situation was. The company was losing thousands every day, increasing its debt. The owners, DELUCIA and prince, we're having trouble getting more capital to keep the ferry afloat. Displayed all of this doom and gloom. Many of the people that actually rode the ferry really enjoyed it. They say the ride was well worth it. The right was a beautiful about the Scot the service everything excellent. Way Drive better much. The fast ferry was full of a medodies that the passengers loved. It had free Wi fi and arcade, a duty free shop, a bar, a restaurant and to movie theaters. Also a scenic viewing platform from where the passengers could watch the lake. According to crew members, this was a fan favorite. But under all of this, things were going wrong, for example that viewing platform that the passengers loved. Well, during one specific trip there was a storm that the crew thought and may take down the ship. While they were struggling to stay afloat, Passengers Watch the storm in off from the viewing room. rereviews from the passengers, but the stress of life and death from the employees. The ferry always seem to be dealing with some sort of mechanical issue. The crew was dealing with weekly repairs on the ship. Everything was going wrong, from broken horns to engine failure. On one particular instant, three hundred Canadian passengers had to be bust back to Toronto after the fairies engines failed. Patients War thing yesterday, when the breeze broke down with engine trouble, stranding hundreds of passengers, really lost my faith in Rochester. The timing couldn't have been worse for cats. The boat left Rochester Saturday sold out. For the first time. Cat scrambled to help passengers make other arrangements. While people were late, and we did get them back home. We got them home on a nice coach. We Fed them, begged for their consideration and extend that our polities for the inconvenience. One of the worst situations workers described was dealing with the routine detainees. Yeah, you heard that right, detainees. Almost every day US Customs would stop one or a few Canadians from entry in the US, usually for criminal convictions or legal troubles. This was post hundred and eleven, so security was heightened. Employees had the Hellis job of calming down these people and telling them that they would have to sleep overnight on a couch in the fast ferry. Employees get so used to dealing with detainees to the even head snacks, blankets, Cablechev and alcohol saved for them every night. But despite these problems, the average passenger was having a great time and telling the friends about the fairy. Cats. Found that word of mouth was the way most people heard about the fairy so in August of two thousand and four they launched half price days on Monday through Wednesday. This caused an explosion in ridership and therefore huge amounts of free advertising. Colonel Martin even expanded the reservation office and hired new employees to deal with all of these new customers. One thing that the fast fairy particularly excelled that was event gallows for various organizations. Retreats for local businesses at family gatherings were all held on the ferry. Over the summer of two thousand and four, dozens booked events on the ferry. The first trip was a fundraiser for the Rotary Club. Many of the customers even sent thank you letters to cast because of how good the experience was. Organizations were even trying to book for the next year of two thousand and five. The event business was booming, but when staff asked upper management to approve of the new two thousand and five bookings, they were told to hold off for now. The average cats employee knew of many problems that the fairy was suffering from, but only upper management really understood the severity of the situation. In the various interviews, Martin gave several reasons that the fairy was losing money. To run the ferry,...

...cats had to pay a lot of fees, pilotage fees, sixty five hundred dollars a day. Customs Fees Twenty five hundred dollars a day. On top of fees, there was also the commercial truck issue. Despite getting an informal okay from US borders and customs, the government shut down commercial truck transport down the ferry. This is a major part of the business plan. It cost cats eighteen thousand dollars per day. Then there was the ferry terminal in Toronto, which wouldn't be ready until next spring. There is no terminal like at home. Instead there are tens in a temporary set up. We're doing everything we can to push our federal government to make things happen and I'm sure they'll work out in an appropriate way because this is too important to let it fail. Cats couldn't legally leave fairy passengers in a snowy parking lot in Toronto with no shelter during the winter, so all winter operations had to cease. Well, President Martin tried to lower operating costs. Brian Prince, CEO of cats, saw at external funding to keep the operation afloat, but ultimately they cannot save the fairy. On September seven, two thousand and four cats abruptly announced the suspension of the ferry service. The ferry had operated for just eighty two days. We couldn't in good conscience continue this operation going forward, knowing that there was no relief in sight on these major hurdles that have been put in front of this company since day one. Those hurdles include high fuel costs and unfinished terminal in Toronto, piloting fees, the inability to carry freight and Canadian customs fees. And with all of those burdens it costs fiftyzero dollars a day to run the ferry, and that's money cats doesn't have. I got a call at thirty in the afternoon, call on September, the fourth and the seventh. It was the day after Labor Day. I had come in my office and I got a call from either delucia prince saying the fairy just left for Toronto. That is his last trip period. He will be closed. We will shut down when it comes back from Toronto tonight. No prior warning at all. No prior warning at all. All right. How must that of a heart attack in Rochester there was chaos after the surprising announcement the fast fairy had been yanked from servants. Now we have nothing but a ticket, you know, for over a hundred dollars. Now Pete and full passenger star void wonders. I don't know what's going on as far as tickets or anything. If they're gonna, you know, reimburse her, we're going to look at providing the money available to make those refunds, but we would hope that they would reschedule out a future day and we're going to try to accommodate that. Well. The folks who run the fast ferry scrambled and notify passengers about the surprise shutdown they've you had to tell prospective customers when aid in your side. Check the breeze's website this evening. There's no mention of the temporary service shutdown. In fact, customers are still being urged to show up forty five minutes early, and it isn't until after you attempt to book passage. This small print states no service at requests a time and when we call the toll free customer service number or to God answer. So it disconnected as without, letting US say, the message. After cats shut down operations, they promptly laid off almost all of their employees numbering around two hundred people, simply because they couldn't pay them anymore. So there wasn't really anyone left to answer the phones. Angry and upset customers who wanted their refunds had no one to complain to and, more importantly, no one to actually give out the refunds. In response to the hordes of angry customers, the state stepped in. Did yourney General's office encourages customers to contact cats and if passengers do not receive...

...adequate and timely response, the state is ready to mediate relief. A wave of complaints poured into Attorney General Eliot Spitzer's office. The state decided to take legal action against cats. Cats had claimed that they were not aware of the sheer number of complaints received by the state, that they were out of the loop, probably because they laid off the guy at the phones. Even with debts of one point seven million dollars, cats was ordered to pay another a hundred and Fiftyzero dollars in refunds to more than one hundred customers. Many fairy passengers were saddened as they disembarked what will be the last fairy journey for a while. I'm sad. I'm very sad about it because this is my first time over. It was awesome, unfortunate and I wish I knew why. We're totally devastated about it. Their first triple what this morning. Wonder if how beautiful day enter Rono racked about the trip told everybody in trying to come to Rochester. De Lucia commented to a local newspaper quote. I think you are looking at the low point right now. The high point is yet to come. After the departure of Cornell Martin, many in Rochester still had the desire to give the ship a new start. I think it had to do with unbridle optimism and naivete all right, really to be fat at Damn for every other virtue that they had. They knew nothing about running fairy business. When we got sucking to this venture, when of the first things we did was to find and experience ferry operator, we came with a deal. It had nothing to do with ego of vanity any of that kind of stuff. It was still a very strong economic generator to link those two cities. Were talking about a metro problem area, but over five million people. That's going to link with a one million met problem area. Who wouldn't make that deal? If you could make that deal with eight councilmen voting yes and only one voting no? By the city council, three months after the fairy stopped running, the city decided to buy the fairy back desplite knowing the fact that it would be a huge risk for all taxpayers and the city. Thousands of residents in Rochester still supported the new plan and believe that instead of the private company cats, the city has more leveraged with the government to make it work. How do we rescue this? Not How do we spare our sales of embarrassment? But they believe, and they probably still believe, there was some validity in that economic plan to start up ferry service in the United States. How do we get this going? And in turn, to said mayor, we check your city's credit rating and will lend you the money. We will lend you the money to get this venture going. Mayor Johnson, believe that if the city had owned the ship from the start, they would have more details about the financial situation and the operation would not fail. Rochester purchase the ship at auction. Mayor Johnson himself put forward the winning bid and astounding thirty two million dollars, which he made with a novelty fairy shaped paddle. After the auction, Mayor Johnson raised a glass to toast the many who stood by him in his campaign to secure the high speed ferry for the city. While most people in the city council felt extremely confident, one thing was for certain. Managing a fairy is far more difficult than winning an auction. But the city did have one advantage that cats did not. Unlike cats, the city didn't need to make a profit. The fairy could simply exist as a subsidized public operation as long as it was still good for the city to make a floundering business work again. The city government shows Bay fairies limited to run the operation. They signed a three year contract. Trying to learn from the recent past,...

...the city set aside eight million dollars in reserve funds in case of a budgetary emergency and my belief, if that ship had been allowed to run its natural course, we put it on a three to five year plan. We had built into amp payment sketched. Now we got that to pay back. We had built an INN. We allowed for that. So we would build an inn some cushion some reserve funds to take unknown contingencies into effect. That ship had been allowed to run, there's no question about mad. It would still be running today and it would be a rather successful adventure. Now without cats, the high speed ferry resumed service on June thirty two thousand and five without delay. The first week was a blast. Three hundred and twelve passengers paid to ride the fairies first trip, more than four times the number on the equivalent voyage last year. The Friday morning trip to Toronto dip to about two hundred people, but double to about four hundred passengers on the return trip. In the first two months, the faery riders doubled since the start up last year and everything seemed to be heading in the right direction. The fast fairy second chance appeared to work. I reported a ninety six percent on time operation. Seventy six percent of passengers said they'd ride it again. The people of Rochester could not wait to see the revenue which the ferry made. Despite the relative success of the revitalized ferry service, the question still remained. We are these numbers enough to support a seven hundred and seventy four passenger ship indefinitely? Because of the financial report from the first two months of service, which came out in late August, Bay fairies revised the fall schedule for the first time, cutting weekly trips from twelve to eight. Then in the beginning of November they dropped the weekly trips down to four. Early in December, Bay fairies cut the season short by stopping the ferry from running. Unlike the cats operation, this stoppage wasn't due to operating costs, since it was the city Rochesterire could handle those and keep the ferry going as a subsidized operation. What really ended the ferry was all the accumulated debt it had incurred from the start and the payments the city would have to make on that debt. The city would have to take care of this problem before they could continue op operations. This time at least there were representatives to make alternative arrangements for the passengers who had already booked tickets. But this time it was more than the passengers who were affected. Beamon, owner of California, rolling to a Sushi restaurant on the part of Charlotte, commented. It is not surprising. We're not doing too good at all. We have a five year lease, which was subject to a fairy we have got three years left and we will not make it through this winter without help. Beaman soon added sushi making classes to supplement his business. I am definitely going to stay until we had rock bottom. Despite failing twice, Mayor Johnson was not ready to call it quit. As he requested eleven point five million more dollars. The city emptied their reserves and ran up a two million dollar debt with Bay fairies Great Lakes as I was leaving office in the end of December two thousand and five. By then we had developed a whole new operating plan, we had developed a whole new marketing strategy. I felt extremely encouraged, even though I wouldn't be an office any longer. I've felt extremely encouraged that we were putting this on Sampay. We had actually contacted a financier or years and they've really rolled a payments back so that...

...we actually had months in the new year where we wouldn't have to make any payments toward debt, because everybody believe it in that everybody intimately involved with his venture wanted to see at work. Johnson had set up the ferry for another go at it, but unfortunately politics got in the way of the fairies future. At that time the city was forty million dollars in debt from the Faery, digging another eleven point five million further when only intensify the problem. Did the floundering business deserve to be saved again? The answer took over a month for the newly elected mayor, Bob Duffy, d answer and as of today to sit at Rochester, stepping back away from the ferry business. The mayor says he had to ask himself for questions. Can the city afford to run the ferry? Is there a sound business and marketing plan? Is there a likelihood for success, and is this the best way to spend fifty one and a half million dollars? Answered all these questions is simply not. Last year the city borrowed forty million dollars to buy the ferry and restart service to Toronto, but the city got a late start, failed to market the boat and was plagued by technical problems. We lost ten million dollars in ten months. Duffy says even in the best case scenario, the ship will bleed money well into the future. If we double our ridership this coming year. If we raise our fares twenty percent, based on all the projections and a data that we see, we will still lose approximately two point seven million dollars this year, and that is with the best case scenario. It is a decision that is difficult as it is, I am absolutely at peace with I feel my heart this is the right decision. I am not feeling torn. I'm feeling saddened by this, but I'm not torn. This is the right decision. The end of the fairy was marred by politics. Duffy's actions as the new mayor went against Johnson's plan to continue the fairy, but at the end of the day Johnson forgave Duffy for ending operations. I don't think we were given sufficient time to prove. It's about talent and because of one thing really. My term as mayor ended in the first year of operation and I was determined to that nothing changed my man I was physically drained and exhaust I got to get out of here. The sale of the fairy, like most of this entire fiasco, was also marred with troubles. Well, the fairy remained at the port. The city of Rochester had to pay one point five million in the year of two thousand and six so that a buyer could finally take the ship away. In mid October, the city even posted the ship on Ebay with a Price Tag of twenty nine point eight million dollars, though later the city spokesman claimed that to be a joke from the dren. There was no doubt that the city wanted to get rid of the ferry before the winner. The sale the fairy took place over several months. Many European companies vied for ownership of the vessel. The eventual winner was a German company called Frs, who bought the ferry for the price of twenty eight million dollars. Mayor Duffy's main goal was finally addressed, selling the fairy and moving on. On December twenty one, two thousand and six, at forty two PM, hundreds of spectators line the genesee river, many of them waving goodbye as the fairy took its leave in the gathering darkness. Back in Rochester, the empty port and Terminal Building were silent. In briefer marks to the crowd that gathered at the port to bid the vessel a d mayor Duffy said, than anyone who thinks this is a loss, a step backward, should believe that better days are ahead. Forty million dollars have been lost, a hundred and thirteen thousand passengers...

...rode the ferry and two and a half years had passed since the ferry arrived at the port of Charlott in its wake, the fairy left behind anger, frustration in debt. How does Rochester move on from this trauma? Find out next time on here you are. I have never been a boa stab I'll just content to be dream even if I could have fought a stable, I would take the ferry boat every time this has been. Here you are a podcast from the Department of History at the University of Rochester. The LEET researcher for this episode was Mark Mahollick. This episode was produced by Samson Howe and sound engineering was by Maxwell Sheldon. Our narrator for this episode was Mark Mahollok. The CO ordinating producer for this season of here you are is William Cusios. The executive producers are Thomas Fleischman and Stephen Ressner. This episode featured music from Poddington Bear. Our theme song. The ferry boat. Serenay was written by Harold Adamson, Mario Penzari and Eldo de Lazaro and arranged by Eleanor Leno. It was performed by Elizabeth Tye, Lauren Bales, eleanor Lenox and Dira Bell and engineered by Ethan Weinstein. A big thank you to Maribell Johnson for agreeing to be interviewed for this podcast. The production team at here you are. Would also like to thank the following people and organizations. Thank you to Michelle Fin and the Rochester Public Library for their guidance and access to newspapers and research materials. Thank you to colleen law and W RO OC channel eight for access to their extensive newslips, thanks to Melissa Meade from rare books and collections at the University of Rochester for her insight into proper research methods and practices, and especial thanks to Sondra Nipsel for interview advice, so Fiato car for social media tips and Janelle heart for her graphic design work. For more information on this episode, including images, additional links transcripts, as well as the rest of season three, visit here you arecom thanks for listening. I love music is so levery on the UP. Boys and girls are Du what sweetheart sorrows, happy as we think together, happy as we seem together, happy with the FRY boat seven.

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