2019-04-09 Services & Organisation Committee Agenda

SERVICES & ORGANISATION COMMITTEE MEETING AGENDA                                              9 APRIL 2019


      Commercial fishers and wormers crossings at $2.50
      Up to 100 resident vouchers for distribution to family, etc. at $2.00
      Up to 20 ratepayer vouchers for distribution to family, etc. at $2.00
Operational challenges for NNSF principally stem from fluctuating customer arrivals (with tide
times and weather forecasts being major factors), resident/ratepayer permit administration,
vessel maintenance and employee rostering and retention.
Existing Lease Structure and Provisions
The 2009 lease document is a prescriptive agreement focussing on the following key provisions:

Provision                       Details

Exclusivity                     Council offers the ferry lease exclusively to the lessee and must not grant
                                any other lease during the currency of the agreement.

Ferry service requirements      Lessee’s service must meet prescribed hours, number of ferries, minimum
                                design and capacity requirements, marine survey, registration and on-call
                                arrangements.

Revenue sharing                 Revenue sharing formulae are prescribed for all vehicle types, as well as
                                afterhours charge rates and CPI increases.

Revenue adjustment              Schedule E provides for adjustment to lessee’s revenue, where standard
                                vehicle numbers are impacted by new North Shore visitor permit regimes,
                                restrictions, or the like.

Other lessee obligations        Lessee’s requirements for maintenance, communications, signage and
                                administration.

Ticketing                       Hard copy tickets are required to be issued, with numbering to be
                                recorded and subject to inspection and audits.

Lease extension                 Lease may be extended by not more than 5 years by mutual agreement.
                                Either party may give notice to the other that it wishes to extend at least 6
                                months prior to the lease expiry.

Other                           Indemnities, insurance, security bond, legal costs, default, cessation

Available Options
In accordance with the lease provisions, NNSF formally notified Council on 10 December 2018
that it wishes to exercise the available extension period (1 July 2019 to 30 June 2024). A
decision of Council is now required before a lease extension can be enacted.
The two primary options realistically available to Council in relation to the ferry service are:
1.   Agree to the operator’s request to enter into a 5-year extension under the existing terms; or
2.   Proceed to a new public tender process for a new ferry lease.
Under Option 1 there is limited opportunity to seek service level amendments, with the lease only
allowing minor changes by agreement, such as extensions to operating hours.
Under Option 2 it is likely that a transitional agreement would need to be established with NNSF
to allow time for a new tender process, contract award, and potentially a ferry commissioning
period for a new operator.
Resident Concerns
The Noosa North Shore and Teewah Beach area contains 253 residential properties and NNSF
currently provides 146 residential and 338 ratepayer concession passes and further worker
passes. The ferry service is an essential service to residents and is critical for their access to the

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