Nova Star ferry to get another $5M from province

The Nova Scotia government announced Tuesday it is committing another $5 million to the owners of the Nova Star ferry between Yarmouth and Portland, Maine.

The latest funding announcement brings the total level of government money invested in the ferry to $26 million.

When the Liberal government announced funding for the ferry last year, it committed $21 million over seven years. But by July, the province had already given out the full $21 million.

It was an up and down year for the Nova Star. After lower than expected numbers for much of the summer, the company said it met its passenger target for August when more than 20,000 passengers used the service that month.

In total, the ferry had 59,000 passengers in its inaugural season.

Michel Samson, the province's Minister of Economic and Rural Development and Tourism, said the original agreement with Nova Star Cruises negotiated by the former New Democratic government was "unrealistic."

"At this point in time we are looking at every possible way of cutting the costs of operating this ferry service and so those are some of the discussions that we will be having," Samson told reporters.

"Will the ferry be costing us money next year if it's operating? Yes. Like every other ferry in Atlantic Canada does to the governments that run them."

Stronger financial controls

As part of the agreement for the additional $5 million, Nova Star Cruises will have to provide detailed financial reports to the province, including weekly cash-flow projections and immediate reports of any changes to cash flow.

As well, KPMG is auditing Nova Star's costs.

Progressive Conservative Leader Jamie Baillie said more of a plan is needed to ensure the ferry is viable.

"Until we have a plan to make it sustainable in the long run, we're going to see more admissions like we saw today that it needs more money," he told CBC's Tom Murphy.

Baillie also feels Nova Star Cruises is not putting enough money into the ferry.

"We all want to see this succeed but if we're going to have a partnership, there has to be a partner on the other end that's willing to put something in," he said.

Despite the extra cost, the mayor of Yarmouth said she's pleased the province is continuing to support the ferry.

"We have to remember it's a start-up year," said Pam Mood.

"If the government today said, 'You know what? No more,' I think we'd be screaming a whole lot louder than we are with the fact that they're actually stepping up and saying, 'We need to make this work.'"

In September, Nova Star Cruises announced it would be shortening its sailing season by three weeks. The final voyage was to set sail from Yarmouth on Nov. 2, but was changed to Oct. 13.

"For the long-term success of the service, we have decided to end our first season earlier than planned and will focus our efforts on building business for next year," said Mark Amundsen, the CEO of Nova Star Cruises in a statement at the time.

Samson also said that during a recent discussion, Maine Gov. Paul LePage committed to introducing legislation to allow Maine to provide a $5-million line of credit to Nova Star.