The Molokai ferry will make its last Lahaina-to-Kaunakakai run on Oct. 28.

Efforts to keep the struggling commuter and tour business afloat were sunk by competition from federally subsidized commuter air travel, declining ridership and government regulations, according to Sea Link President and Senior Capt. Dave Jung.

“As long as air travel is subsidized by the federal government, it will be very difficult for a heavily regulated, nonsubsidized ferry to operate,” Jung said Wednesday.

Sea Link reported that its total passenger count dropped 49 percent from 1,691 in January to 859 in July.

The Hawaii Public Utilities Commission regulated Sea Link’s Molokai Ferry, and on Monday it approved Sea Link’s request to surrender its “certificate of public convenience and necessity” within 10 days. The certificate has allowed Sea Link’s Molokai Princess to carry passengers between Maui and Molokai. One-way fares have been $60.59 for passengers 13 years and older and $30.30 for those between 2 and 12 years old.

The federal government awarded Makani Kai and Mokulele airlines an annual subsidy for four years of approximately $4.5 million, Sea Link reported to the commission.

“This has led to extremely low fares in 2016, as low as $36 . . . from Kapalua, Maui, to Hoolehua, Molokai, on Mokulele Airlines, for example,” the company said. “Sea Link believes that ridership will continue to stagnate or decrease further, and raising passenger fares/charges will only worsen the situation — which will cause Sea Link to continue operating at a loss or incur further losses.”

About 10 employees work on the Molokai ferry, Jung said. They’ll be absorbed by sister company Lahaina Cruise Co., he said.

The commission’s order notes that Sea Link asked to voluntarily give up its permit because it wanted “to cease its operations as soon as practicable to avoid further financial loss.” There was no objection from the state Consumer Advocate, which verified that current airfares between Maui and Molokai “appear to start from $50 to $58 for one-way travel” on regularly scheduled flights.

“Thus, for many commuters, airline travel appears to be a viable and competitive alternative,” the Consumer Advocate told the commission.

Even if Sea Link were able to increase its fare prices to cover its operating expenses, “the higher prices would likely lead to further decreases in ridership as more passengers substitute toward air travel or stay on island,” the advocate said.

The Consumer Advocate said regularly scheduled ferry service between Molokai and Maui would require “some degree of government intervention and subsidization . . . Nonetheless, no alternative sources of funding are apparently available to support Sea Link’s continued operations.”

The commission received 21 comments from members of the public, most of whom called upon the commission to support the continuation of the ferry as “a vital transportation service and an option to airline travel, especially for Molokai-based travelers.”

The written comments also “bemoan the lack of financial assistance from the state and county governments” for the ferry.

Among the commission’s letters was one from County Council Member Stacy Helm Crivello, who holds the Molokai residency seat.

In it, she stressed the “critical importance” of the ferry to Molokai residents, especially young people and off-island workers.

“As a matter of low-cost affordable travel for our residents or our school’s athletic teams who travel to Maui and Oahu to participate in athletic events, the affordability is paramount,” Crivello wrote. “To send our teams over or bring teams to Molokai, the ferry is ideal in carrying all the teammates, coaches, supporters and equipment for an affordable fare versus several flights on our small eight-passenger commuter airlines. Just to transport the team and equipment will be a logistical nightmare for our schools and their travel budget.”

Kaunakakai resident Michael Fiorito said the ferry should continue to operate, and a state subsidy for assistance should be sought.

“Molokai is already too isolated, and the ferry serves as a lifeline,” he said.

Molokai resident Pamela Mathis said the ferry should be an affordable, discounted travel option for residents who want to island hop “without spending too much money.” However, flying is cheaper.

“Because the ferry is at least $100 round trip a pop, most residents would prefer to just hop on a flight,” she said. “There’s no incentive and is unattractive for someone to pay $120 to island hop or travel to just one island.”

Kaunakakai resident Cindy Spector said she rode the ferry for about 10 years as a commuter.

“Molokai ferry is a part of Molokai,” she said. “It would be awful to only have airlines to get to Maui. It just seems wrong to take away our connection to Maui. We are Maui County, after all.”

Spector said she enjoyed the experience of riding the ferry “when you see rainbows and you have two hours to relax and enjoy nature and the ocean.”

“I would feel very stuck and isolated without the Molokai ferry to jump on and make a connection with Maui,” she said.

Jung said his company would look at supporting Molokai school and community groups with chartered ferry service, which is not regulated by the PUC.

And, “we will lobby strongly for the state or county to assume ownership of a Maui Molokai ferry system,” he said.

The service would be similar to the Maui Bus system, owned by Maui County but operated by Roberts Hawaii, Jung said.

When asked about falling passenger numbers, Jung acknowledged that but said “that doesn’t mean you don’t continue the service.”

Rural bus routes, for example, don’t run at high passenger capacity, “but it’s necessary to bring (bus service) in rural areas,” he said.

Jung said he feels “really, really sorry for Molokai” where generations of residents have grown up with the Molokai ferry.

“The impact of isolating Molokai is going to be huge, not just economically but psychologically,” he said.

*Brian Perry can be reached at bperry@mauinews.com.