$343 a trip: San Francisco ferry costs led nation despite slashed service. Can they stay afloat?

When Alexis Nelson hitches a ride to work on a 450-passenger boat heading from San Francisco to Marin County, she is arguably getting the best deal in Bay Area travel: Nearly private ocean views for $8.50.

But behind that ticket price are millions of dollars in Golden Gate Bridge tolls and massive sums of federal pandemic relief money that keep the ferry afloat.

“Earlier in the year it would literally be me and one other person on the 8 a.m. ferry to Larkspur,” said Nelson as she read a book on her 30-minute commute. “It’s pretty nice.”

San Francisco ferries are one of the Bay Area’s iconic public transit options – and are meant to be a vital cog in the region’s traffic reduction efforts. But moving virtually empty boats during the pandemic has come at a hefty price for taxpayers. For ferries serving Marin County, average per-passenger costs soared to a nation-leading $343 a trip in 2021, and ferries serving the East Bay and Vallejo were the third-costliest at $117, according to a Bay Area News Group review of national transit data and expense figures provided by local ferry operators.

Those per-passenger costs for the region’s two ferry agencies – Golden Gate Ferry and San Francisco Bay Ferry – have more recently swung to $44 and $33 as riders slowly return, but the pandemic costs underscore how a beloved ferry network is now on life support, with deep financial troubles on the horizon amid high costs and ridership around half what it was before COVID.

While ferry agencies warily eye their budgets, passengers love their boats and think little of cost-efficiency while being hit with fresh ocean air and views of the Golden Gate.

“I like it so much that I’m selling my car,” said Jessie Kozar, who commutes by train and ferry from San Mateo, sipping a morning coffee and chatting with a friend on her way to work at Ethan Allen in Corte Madera. “It’s even more fun on the way back when you can drink.”

But the financial woes are so severe they could threaten the future of boat service in the Bay Area, especially for the Golden Gate Ferry, with core service running between San Francisco, Tiburon, Larkspur, and Sausalito. Not only are the agency’s affluent commuters returning at a far slower tick than many other transit agencies. But the cost of running a Golden Gate Ferry boat regardless of the number of passengers aboard was $2,919 an hour in 2020, the second highest in the nation. Only New York City’s behemoth fleet of Staten Island passenger boats cost more to run — nearly $8,000 per hour; however, those vessels are closer to cruise ships in size and have far lower per-passenger costs.

Even compared to its peer across the bay, Golden Gate Ferry’s boat operating costs are nearly 25% higher than the SF Bay Ferry.

Denis Mulligan, the general manager for the Golden Gate Bridge, Highway and Transportation District, which operates the ferries, said that costs are high because the passenger capacity of his fleet of five diesel-powered boats ranges from 450 to 750 people, often double the size of SF Bay Ferry vessels.

“I can’t have a 450-person boat go from Larkspur to San Francisco and then have that boat shrink on the return,” said Mulligan. “We have fixed costs baked in as a pretty high percentage.”

Prior to the pandemic, taxpayers subsidized roughly half the per-passenger cost of ferrying someone across the bay and ticket revenue made up the other half. That was a good deal in public transit where some agencies, like VTA, are subsidized by nearly 90%. But now fare revenue has plummeted and taxpayers subsides make up over 75% of passenger costs – about $25 to $35 per ride. By contrast, BART’s subsidy per person is roughly $14, and VTA’s bus and light rail is $20.

It was not always like this. The Bay Area’s ferry network saw booming ridership in the decade before the pandemic, serving over 18,600 passengers a day in July 2019 as affluent commuters happily sailed by growing traffic gridlock while sipping beers from the in-boat bars and tourists flocked to Sausalito. Public transit, including ferries and buses, reduced congestion on the Golden Gate Bridge by nearly a quarter.

Now ferry ridership is down about 50% even as Bay Bridge commuters are reliving rush-hour traffic nightmares and Golden Gate Bridge congestion is about 80% of its pre-pandemic figures.

While the cost of operating Bay Area passenger boats outpaces many other ferries, so does the price of tickets – ranging from $4.50 to as much as $15.50 for some Oracle Park trips – which are among the most expensive in the nation for publicly-subsidized sea transit, according to national transit data.

Besides passenger fares, the largest source of pre-pandemic ferry funding was bridge tolls, with about $16 million of Golden Gate Bridge revenue dedicated to North Bay ferries and $18.5 million from the other Bay Area bridges going to ferries spanning Alameda to Vallejo in the fiscal year before the pandemic.

But in 2022, ferries, like all transit agencies, are balancing their budgets with pandemic relief money. These funds – over $287 million for Golden Gate Transit’s bus and ferries – are expected to run out somewhere around 2025 depending on how fast riders return.

“The federal money is one-time money,” said Mulligan. “And my finances are still upside down.”

Faced with dire financial straits, the San Francisco Bay Ferry and Golden Gate Ferry have taken opposite routes. The San Francisco Bay Ferry actually has reduced fares by around 30% to as low as $4.50 for many passengers and boosted service past pre-pandemic levels as it seeks to lure back riders. Meanwhile, Golden Gate, which also manages a fleet of buses serving the North Bay and San Francisco, has restored service at a slower pace than any other Bay Area agency, transit data shows, with some bus and ferry lines still half of pre-pandemic levels.

Fred Ruhland, 88, used to take Golden Gate Transit’s Bus No. 24 into the city, which was located blocks from his house before it was cut. Now he drives to the Larkspur ferry, which had its frequency slashed from over 40 daily trips in 2019 to 22.

The transit system used the pandemic as an excuse to eliminate service,” said Ruhland. On a recent Tuesday, he was unable to make a workout class due to service cuts.

Mulligan, the executive, said he is taking a riders-first approach: cautiously restoring service as riders return. He has plans to add two more trips from Larkspur to San Francisco in September and started a new daily service to Angel Island State Park.

“If a see a return, then I would add more bus and ferry service,” he said. “(Without riders) it would be like having a restaurant cook a hundred hamburgers when there are only 10 customers.”