The Rochester Ferry Co. Chronicles: Part I – What is it?

Posted by & filed under Uncategorized.

So much written, so much said about the effort to bail out the Rochester-to-Toronto ferry service.

And yet it’s not the City of Rochester that must approve $11.5 million in borrowing for the beleaguered boat. It’s up to an organization called the Rochester Ferry Company. Sounds like a separate entity from city government, right? Well dear reader let’s get at that notion right away.

It’s well worth asking – just who is the Rochester Ferry Company. It was conceived nearly a year ago. This was after the original private owners of the ferry – Canadian American Transportation Systems – showed a big loss for the big boat and closed shop early. The city created the organization to borrow $32 million to buy the ferry.

The oddity of the Rochester Ferry Company showed itself early on. Originally Mayor Bill Johnson wanted to create a not-for-profit corporation. IRS guidelines required that a not-for-profit have a large majority of the board of directors coming from the sponsoring organization. That meant the city. So that meant nine of the eleven people would be city elected or appointed officials.

But a funny thing happened on the way to the corporation. Upon further review, the city thought better of it. The city leaders decided, instead, to create a limited liability company. They changed the name from "corporation" to "company" and called the "board of directors" the "board of managers."

The Rochester Ferry Company was born.

And yet – even though the IRS regulation on board makeup no longer applied – the legislation creating the company still called for nine of the 11 members being city elected or appointed officials. Why? Inertia? Because it was easier to keep going without making changes? Or did the city want that many of its own on the board to keep the tightest possible control on the ferry operation? Johnson had plenty to say about it at the time.

Mayor Johnson and City Council President Lois Giess automatically had seats on the board. Johnson named five others. They were administration officials Ed Doherty, Loretta Scott, Bill Ansbrow and Jeff Carlson (Carlson was eventually replaced by another Johnson administration official, Linda Stango). Giess named four people to the board. And, as you might have figured, they largely came from the city council – Ben Douglas, Wade Norwood and Gladys Santiago.

The legislation also called for the mayor and council president to name one outsider… so Karen Noble Hanson and Charles Barrentine were appointed.

But make no mistake. The Rochester Ferry Company WAS and IS the city.

So when you read news accounts of how the ferry company board was loathe to provide information about the service (see Tim Mains quote)… when you heard that the ferry burned through an $8 million reserve… and when you realized it continued to operate when the bank account was empty — there was only one place to look.

The company is the city.

With the new year… and a new mayor taking office… there will be changes on this company’s board. Incoming mayor Bob Duffy gets Johnson’s seat. And Duffy has ousted Stango, Doherty and Scott. So he gets to appoint replacements. Giess must replace Norwood (who leaves the City Council after his failed run for mayor).

Interestingly enough, there is a movement afoot to loosen up restrictions on the board make-up, to allow fewer city officials. Duffy has said that Giess would like to appoint someone with business experience – an outsider – to replace Norwood. Duffy loves the idea and gives the impression that he would like to do the same. That would take a change of the legislation.

Don’t be surprised if you see that happening on January 5 when the City Council must approve Bob Duffy’s three appointments.

But until then – the Rochester Ferry Company is the city government.

So is the company needed? We get at that in part two of this trilogy.