Michigan Senate backs Mackinac Island in ferry ‘monopoly’ fight

• Michigan Senate approves bill allowing the city of Mackinac Island to regulate ferry prices to and from the island
• A Florida-based company owns both ferry companies serving the island and has been increasing prices against the city’s desires
• Island officials and local businesses want the prices to be regulated to avoid impacts to the island economy

The Michigan Senate approved a bill Tuesday that would give the city of Mackinac Island authority to regulate all aspects of ferry service to and from the island — most notably the prices. 

The bipartisan vote came after a Florida company, The Hoffmann Family of Companies, bought both major ferry companies that offer service to the island and subsequently raised prices for both tickets and parking. 

An adult round-trip ticket to the island currently costs $38, and the company has recently added other unregulated convenience fees. 

Hoffman sued Mackinac Island in March after city officials denied proposed rate hikes. Mackinac Island countersued, claiming the city’s charter permitted them to do so.

As Bridge Michigan recently reported, Mackinac Island businesses are worried unregulated increases in ferry costs threaten the island’s economy and could be disastrous if Hoffmann is allowed to continue. 

Senate Bill 304, introduced by state Sen. John Damoose, R-Harbor Springs, was approved Tuesday in a 30-6 vote and now heads to the state House for further consideration. 

The legislation would amend a state law that governs the city's charter to allow Mackinac Island to regulate all aspects of ferry services, including fees for baggage, parking and early or priority boarding, “whether within the city or on the mainland.” 

Related:

• Mackinac Island fears ‘economic strangulation’ by ferry. Will Lansing step in? 
• Are Mackinac Island ferries a monopoly? Lawsuit claims island got it wrong

State Sen. Jim Runestad of White Lake, who also chairs the Michigan Republican Party, spoke in favor of the bill before the vote Tuesday.

“This Florida-based monopoly now enjoys a chokehold on access to the island,” Runestad said in a floor speech. “It is not a free market. With complete control over the docks, Hoffman has blocked competition as it’s shifting costs from regulated ferry tickets to unregulated parking and service fees, gouging the tourists and the Michigan taxpayers alike.” 

Runestad noted Mackinac State Historic Parks have been allocated $35 million from Michigan taxpayers for infrastructure improvements, and they should be able to access the island. 

“We cannot allow this to happen to Mackinac Island, repeatedly voted as one of the most beautiful places in all of America, and a public treasure funded by the taxpayers here in the state of Michigan,” Runestad said. 

The village of Mackinaw City opposes the bill, claiming it will undermine the authority of St. Ignace and Mackinaw City by giving Mackinac Island power over “all aspects” of ferry service. 

“This bill would strip our community — and others within reach of Mackinac Island—of the tools we need to make decisions in the best interest of our residents, environment, and local economy,” village President Scott Newman said in a recent statement. 

The legislative action came one day after a federal judge blocked a Mackinac Island attempt to control the ferry rates, ruling that the city could not unilaterally declare Hoffman a monopoly in order to revise a 15-year franchise agreement. 

The ferry company is attempting to address "widespread neglect, unreliable vessels, failing docks, and an infrastructure in disrepair," Hoffmann Family of Companies CEO Geoff Hoffmann said in a statement.

"This legislation does nothing to improve safety or accessibility, but it will make it harder to operate an efficient, customer-centered business," he added.

​​Chris Shepler, president of Shepler's Mackinac Island Ferry Service, told lawmakers earlier this month that the price hikes were necessary to continue established service and maintenance. Now an employee of Hoffmann, he and his family sold the three-generation ferry business to Hoffmann in 2022. 

Running fast ferries, including maintaining the docks and parking lots, “is not cheap,” Shepler said in a recent committee hearing.

“If we're not allowed to make money to pay for upkeep, then we have to find it another way,“ he added, suggesting staff uniforms, decorative flowers and shuttle services could be cut.