At the SPECIAL COUNCIL MEETING OF THE DOUGLAS SHIRE COUNCIL HELD ON TUESDAY, 8 JUNE 2021, both the Daintree Ferry Revenue General Policy and also the Daintree Ferry Schedule of Fees and Charges for the 2021/22 financial year, were carried unanimously. However, Daintree Rainforest Foundation LTD expressed concerns for potentially unlawful aspects of these policies and on that basis, called upon Council to rescind the resolutions and root out those elements, before voting again on properly reviewed motions.
When Justice J. Moynihan delivered his 26 July 2005 Supreme Court ruling, that the fees determined by DSC as fares to travel by ferry across Daintree River were unlawfully imposed, the operating surplus in respect of the ferry exceeded fifty per cent of the costs of the ferry’s operation and maintenance. Since the operating surplus was deemed a tax and Local Government is not authorised to make charges that include a tax component, the operating surplus was declared unlawful.
At common law, a ferry is a monopoly toll franchise created by an Act of Parliament for the benefit of the public. DSC’s projected increase in ferry revenue and its admission that the Daintree Ferry subsidises DSC’s general rates by providing a revenue stream, manifests, yet again, as a tax – characterised by a compulsory extracture of money by a public authority for public purposes, enforceable by law, which is not exclusively a payment for ferry-transportation services rendered.
The Daintree Ferry Revenue General Policy establishes that only a portion of revenue derived from the Daintree Ferry operations, which is surplus to annual operating expenditure, shall be constrained for the purposes of funding whole of life costs required to sustain this essential service. The policy advises that capping the contribution from each Daintree Ferry annual operating surplus at five hundred thousand dollars, will ensure that there is not an unnecessary constraint on funds required for capital works projects and the maximum level of funds constrained in this reserve will be four million dollars.
Since DSC admits that the Daintree Ferry generates revenue for Council, netting an estimated $1.15 million annually, within the management framework of the recently resolved Daintree Ferry Revenue General Policy (commencing 1 July 2021) five hundred thousand dollars will be allocated to the Reserve and the balance (~six hundred and fifty thousand dollars) will stream into capital works revenue. It is this latter majority portion, which is explicitly not for the purposes of funding whole of life costs required to sustain this essential ferry service, which manifests as a tax.
On a point of principle, if all of the ferry-generated surplus revenue was held within the Daintree Ferry Reserve, to be used exclusively for the purposes of funding whole of life costs required to sustain this essential service; and those funds progressively accrued beyond four-million-dollars, then DSC should recognise that over-charging is driving excess accumulation and reduce fees accordingly, so that the visitor (and tourism generally) is not being over-charged.
Tourism Simulator Research, funded by DSC and conducted by CSIRO (c. 1999), showed a clear inverse relationship between increased ferry fees and visitor-willingness to pay both for the ferry service and also to support conservation in the Daintree Rainforest area, with analysis revealing only 54% of survey-respondents would be willing to pay $40 per two-way crossing. If, however, as DSC Mayor Michael Kerr contends, tourists are willing to pay $39 per two-way crossing to access this world-class attraction and (contrary to CSIRO modelling projections) the number of willing travellers does not diminish because of the increased ferry-fees, DSC revenue from ticket sales will increase from $3.5-million to $4.375-million per annum, confiscating the bulk of the consumer surplus, from which north-of-the-Daintree-River’s conservation economy is otherwise derived.
Councillors were advised that the Daintree Ferry Revenue General Policy had been reviewed and amended, in light of the recent purchase of the Daintree River Ferry. However, since the ferry was purchased from funds accrued within the Daintree Ferry Reserve and (as the community has been informed – around $1.15-million per annum of excess ferry-funds fed into DSC’s capital fund per annum, beyond the $4-million Ferry Reserve Cap) the additional three-hundred-thousand-dollars for the full purchase-price was sourced from these same surplus ferry-generated dollars; therefore, the purchase of the ferry was not funded at all through increases to general rates and such a substantial ferry-fee increase is not justified.
As DSC has resolved to enter into a new ferry-contract, based on a $10,049,906 pricing over the five-year life of the contract or $2,009,981.20 per annum, the estimated $3.5-million in ticket-sales per annum preceding the proposed increases, already substantially exceeds the operating costs, leaving $1.49-million feeding partly into the ferry reserve, but also into DCS’s capital works fund.
Daintree Rainforest Foundation Ltd and its Daintree Rainforest Fund have been registered by the Australian Charities and Not-for-profits Commission and successfully entered onto the Register of Environmental Organisations. Donations made to the public fund are eligible for a tax deduction under the Income Tax Assessment Act 1997.