Governments keep Fundy ferry afloat

The federal, Nova Scotia and New Brunswick governments are once again stepping in to maintain ferry service in the Bay of Fundy.

The new funding agreement, announced Friday, ensures the ferry will keep running between Digby, N.S., and Saint John, N.B., until 2011.

With the current deal set to expire in January, many groups and businesses had been lobbying for the governments to save the ferry they say is vital to the local economy.

The ferry also provides 110 jobs, said New Brunswick Energy Minister Jack Keir, who represents a Saint John-area riding.

"About three-quarters of those are folks who live on the New Brunswick side of the border, most of them quite frankly in the Saint John area," he said. "Certainly that's important that we maintain those jobs."

The two provincial governments are contributing $2 million each for Bay Ferries' operating costs, while the federal government is putting in $11.1 million.

Some of the federal money will go toward studies to look for a long-term solution.

The three governments stepped in with $8 million in 2006 after Bay Ferries threatened to stop its run because of rising costs and declining ferry traffic.