To explain the present situation of the sale of Bald Head Transportation, a good place to start is the legislation that created the statute that in turn created the Bald Head Island Transportation Authority. The legislation was largely the brainchild of the Seller, Bald Head Island Transportation/Bald Head Island Limited. The Authority concept was essentially presented to the Village in 2017 as a done deal, with the Seller expecting to close the transaction by year end or early 2018. Although concerned with the process and some provisions, the Village Council supported the Authority concept in the hope that it would offer a long-term solution to the stewardship of this vital infrastructure.
After the members were appointed, the Seller required Non-Disclosure Agreements to be executed. Adding further to the lack of public information was that substantive discussions of the Authority were held in Closed Sessions unavailable for public distribution. This situation persisted until very late last year when a public vote was taken and a date for final application to the Local Government Commission was set. Unfortunately, the timing did not allow adequate time for meaningful presentation and explanation to the community. Given the time and effort spent already on a very complex situation, and with most (if not all) of it occurring in a non-public setting, the Village Council felt it was important and appropriate to ask the NC Local Government Commission (and Authority) to host a public information session which was held in early February to share information with the BHI public (including island businesses and other users of the system). Following the meeting, there was much public input given to the Authority on issues of concern, particularly with respect to the value of the assets and immediate short-term needs not being considered.
During the three years of deliberation, I along with others became alarmed that the Authority was more concerned with the financing structure rather than the value of the asset and its condition. The appraisals were not fully analyzed; the Buyer’s due diligence was created from afar and relied heavily on the Seller’s past relationship with the consultant, and deferred capital expenditures and maintenance were not adequately addressed. Because of deficiencies at both terminals relating to baggage handling, passenger management, tram service, parking, real estate, toilet facilities, dredge spoils disposal, long-term comprehensive land-use studies and more, the cost could easily exceed $10M.
Of equal concern is that the non-Bald Head Island resident Authority members generally have not personally familiarized themselves with the operations of the transportation system during high-traffic times that include not only summer months but all holidays. Also, the pandemic has resulted in a marked increase in usage, regardless of the restrictions on ferry capacity. This may persist.
It should also be noted that no Bald Head island resident has been on the purchase transaction Negotiating Committee of the Authority for a year and a half.
The intimations in the recent resolutions of the City of Southport and Brunswick County that the Village would not adequately protect the welfare of Southport and County citizens are incorrect. Island guests and service providers are vital to the viability of Bald Head and an efficient and reliable transportation system managed by knowledgeable and committed oversight is essential. If these resolutions are an indication of how the Authority will interact with the community, which after all is paying off the considerable debt, then there is a problem that needs to be addressed immediately.
Like the Authority, the Village would need to hire an Executive Director with broad maritime and transportation experience. Unlike the Authority, the Village already has capabilities in public administration, finance, human resources and public information.
The common goal should be a safe and efficient transportation system providing exceptional service to its customers and rewarding employment to its staff. The Village remains committed to working with the Seller, Southport, the County and other stakeholders to achieve that goal.