Meeting_Body
OPERATIONS, SAFETY, AND CUSTOMER EXPERIENCE COMMITTEE
JULY 16, 2026
Subject
SUBJECT: UPDATE ON FEASIBILITY OF WATER TAXI SERVICE FROM SAN PEDRO TO LONG BEACH
Action
ACTION: RECEIVE AND FILE
Heading
RECOMMENDATION
Title
RECEIVE AND FILE an update on the feasibility of water taxi service between San Pedro and Long Beach.
Issue
ISSUE
At its December 2025 meeting, the Board approved Motion 18 (Attachment A) by Directors Hahn, Bass, Dutra, Dupont-Walker, Butts, and Sandoval directing the Chief Executive Officer to: A) conduct an industry engagement process (i.e., reverse pitch) to identify operator interest, capabilities, and partnership opportunities to deliver a water-taxi service between San Pedro and Long Beach during the 2028 Games; B) assess funding options for special event service; and C) report to the Board with findings, including potential partnership structures, proposed implementation timeline, and next steps. This report summarizes findings from the reverse pitch process, discusses the funding landscape for future service, and outlines next steps.
Background
BACKGROUND
In November 2025, Metro released the San Pedro-Long Beach Water Taxi Feasibility Study (“Feasibility Study”), which assessed maritime service options to supplement existing transportation modes, identified infrastructure needs, and outlined next steps for establishing a Games-time and a long-term water taxi service.
Building on findings from the Feasibility Study, Metro issued a Request for Information (RFI) on April 7, 2026, inviting firms, operators, and partners in the maritime passenger transport industry to share their interest and capabilities in providing a water taxi service during the 2028 Games. Six entities submitted responses, and five were invited to present their proposals directly to the Office of Strategic Innovation (OSI) in May 2026.
Staff promoted the RFI through multiple channels, including Metro’s website (metro.net/water-transport), LinkedIn, a curated e-mail blast to an industry stakeholder list, and through outreach to the Public Ferry Coalition (a national organization representing the interests of public ferry operators across the United States).
A cross-departmental team of executive-level staff from Countywide Planning & Development, Operations, and Customer Experience along with representatives from the Office of Management & Budget, System Security & Law Enforcement, and Community Relations reviewed the responses.
Discussion
DISCUSSION
Findings from industry outreach and a review of available funding sources indicate that grant opportunities for temporary service do not exist, and the timeframe to secure an agreement with a ferry operator in advance of the 2028 Games is increasingly constrained. If funding were to be secured, Metro would need to initiate the procurement process by October 2026 to execute a contract with a ferry operator by July 2027, giving the operator less than a year to plan and begin testing the service in May 2028. The following details a summary of stakeholder conversations, industry engagement (“reverse pitch”), funding options, and key considerations for a future water taxi service.
Stakeholder Engagement
Staff met with more than 15 stakeholders to inform the development of the RFI and to understand potential service delivery options, 2028 Games constraints, and other information gaps raised in the Feasibility Study. Key findings from discussions with the U.S. Coast Guard (USCG), LA28 security and venue planning teams, vessel designers and operators, and transit agencies experienced in contracting ferry service follow:
• Importance of a turn-key operator: Agencies, operators, and vessel industry members indicated the importance of contracting a turn-key operator capable of providing suitable vessels with all required approvals in place. Key constraints for Metro-led vessel delivery include up-front costs and timelines for potential vessel and landing site procurement/improvements, USCG certification timelines for new vessels, and California Air Resources Board (CARB) Commercial Harbor Craft (CHC) compliance.
• Potential 2028 Games constraints: Planning for security zones and in-water events is ongoing, and impacts to existing water taxi routes and service schedules are likely to be uncertain until and even during the Games time. LA28 staff noted that water taxi schedules and routes may need to be adjusted when sailing events are held in San Pedro and when athletes are training in the water.
• Existing water taxi operations: Existing water passenger transportation services operate within the proposed service area, including routes along the Long Beach waterfront. Should funding for service between Long Beach and San Pedro materialize, Metro should explore whether current operators in the region are interested in expanding their service footprint, which would be a faster and possibly less expensive way to achieve the same outcome.
• Coordination with harbor operations: USCG representatives noted the recent establishment of the Olympics Maritime Safety and Security Subcommittee. Coordination with this subcommittee and other harbor operators will be critical to inform route operating requirements and schedule parameters. In past major sailing events such as the Sailing Grand Prix, passenger boats were still able to operate around the security perimeter.
Industry Engagement (RFI and Reverse Pitch)
The RFI solicited responses on prior experience, service delivery models, proposed service plans, vessel availability, staffing, accessibility, security, capital infrastructure needs, cost structure, and creative funding and financing approaches. The RFI was open for 25 days, and responses were due May 4, 2026. Respondents who submitted written responses and met minimum criteria presented to Metro staff in-person and online.
Table 1 lists the six RFI responses received, representing a cross-section of ferry operators, vessel builders, digital platform providers, and organized labor. Ballyhoo Media, an advertising firm dedicated to waterway media, submitted a response after the RFI deadline and did not present to Metro staff.
Table 1: Description of RFI Respondents
Metro promoted the RFI to at least 73 individual companies and received feedback from many, indicating they would not be pursuing the opportunity. Reasons included:
• Limited Vessel Availability: Operators cited several reasons for not participating in the RFI, and the most common theme was limited vessel availability during the peak summer season. Because the Games occur during the year’s busiest operational period, most operators have their fleets fully committed to existing routes.
• Short-Term Contract: Others emphasized that the contract’s short-term nature makes the effort required to mobilize vessels, crew, and logistics disproportionate to the potential return. Some noted that while the vessel market is extremely constrained, they might consider reallocating vessels only if the revenue opportunity were unusually high, suggesting that participation is possible but economically unlikely under typical conditions.
• Relocation Feasibility: For operators based outside of the greater Los Angeles area, such as those in San Diego or the Bay Area, repositioning vessels to Los Angeles for a 47-day service window introduces significant operational challenges. These challenges include crew deployment, maintenance support, fuel or charging logistics, and unfamiliar terminal environments.
• Compliance Timing: Several operators highlighted regulatory pressures, particularly with CARB requirements, as a major barrier. One operator explained that they would be required to replace the engines of at least two vessels before the Games period to achieve compliance, which would remove those vessels from service and further constrain fleet availability. This regulatory timing compounds the already limited supply of vessels and makes it more challenging for operators to commit assets to a temporary service.
Findings from Industry Engagement
Presentations from five RFI respondents were held over two days: Tuesday, May 12 (Bout and Hornblower) and Friday, May 15 (Arc, Harbor Breeze, and PROP SF/Artemis). While no meeting was held with IBU, the feedback provided in the IBU RFI response informed findings.
Metro staff, with support from consultants, reviewed RFI responses, pitch meeting content, and feedback from stakeholder discussions to assess the potential opportunities and constraints for the 2028 Games water taxi service. Key findings related to service feasibility are described in Table 2.
Table 2: Key Service Feasibility Findings from Industry Engagement
Identified Information Gaps
To right-size vessel capacities and service schedules, operators expressed the need for more information in these areas:
• Estimated demand: Understanding overall demand and demand by time of day will support the development of service schedules. Demand information will also support fare revenue forecasting and the pursuit of revenue-generating opportunities.
• Funding levels: A baseline funding level would enable operators to right-size proposed vessels and service schedules.
• Restrictions around sponsorship/advertising: Operators proposed brand sponsorships to cover some of the service costs. However, LA28’s advertising guidelines and restrictions will not be final for another six months. Until the guidelines are released, there is a lack of clarity on which sponsors would be restricted from contracting with non-LA28 entities, and what the advertising radius is around venue areas.
Funding Challenges
The Feasibility Study estimated operating costs for the 47-day Games period at $913,000 to $1,448,000, depending on vessel types and fleet configuration. RFI responses from turn-key operators came close to this range, from $950,000 to $1,535,000. A combination of subsidies, fare revenue, and other sources, such as advertising, would be needed to meet the cost of service.
Staff reviewed potential funding sources (Attachment B) and found that most grants typically used by ferry operators focus on capital projects, which are likely infeasible given the constrained timeline. Among opportunities that offer funding for operations, it is unlikely that a short-term service would be eligible or score well for a competitive federal or state grant. However, local return funding is available to all LA County jurisdictions to support transportation within their jurisdictional boundaries.
RFI respondents identified several potential revenue opportunities that have been used in other special event or long-term ferry services, including:
• Naming rights / sponsorships
• Local business partnerships
• Vessel wraps / branding
• Terminal advertising
• Onboard digital screens / branded content / product demos
• Web and app advertising
• Onboard filming licenses
• Concessions
• Branded merchandise / exclusive on-board sampling, sales, branded packaging
• VIP experiences
While funding a water taxi entirely through advertising is highly unlikely, a blended revenue strategy combining advertising with a revenue-sharing agreement could help fund part of the service. Respondents noted that a combination of various sponsorship and advertising revenue sources, along with farebox revenue, would likely offset some level of costs. They also indicated needing a funding guarantee to cover the costs of launching service given the unknowns of revenue from advertising, fares, or concessions.
Several other options for maximizing farebox revenue were discussed, including:
• Fare policy: Passenger ferry/water taxi services typically charge a higher fare than other transit modes, even when operated by the same agency. Ferries are often seen as a premium service, offering a faster trip time, a more comfortable ride, and/or an entertaining experience. In other major U.S. cities, one-way adult fares range from $1.00 to $9.75 (see Attachment C).
• Variable pricing: Because demand during the 2028 Games may be highly directional and variable throughout the day and depending on the schedule of events, a pricing strategy that allows for higher fares during peak periods and lower fares during non-peak periods may help manage demand and offer an opportunity for increased fare revenue. Variable pricing is typically employed in conjunction with reservation-based ticket sales, may be difficult to communicate, and may not be well-received for walk-up ticket sales.
• Discounted fares: Offering discounted fares in line with Metro’s current discounted rider categories may offer a way to charge higher fares for the premium service while still making the service usable and accessible to all.
• TAP integration: Consistent with Board discussion, respondents indicated that integrating water taxi fares with TAP payments would be beneficial. Respondents stated that their ticketing systems can support TAP integration.
Public-Private Partnership Structures
The Feasibility Study recommended that a public-private partnership, in which Metro contracts an established water taxi operator to provide service, may present the best opportunity for Metro to deliver a 2028 Games water taxi service. Three options exist for structuring the partnership and allocating costs, revenue, and risk:
1. Contract with One Operator - Variable Service Levels: In this model, a turn-key operator contracts with Metro for a baseline level of service with flexibility to add service based on requests from Metro and/or revenue availability. Metro may elect to off-ramp the contractor if funding does not materialize or if Metro and the contractor fail to reach agreement on service levels.
2. Contract with One Operator - Fixed Price: Metro could establish a fixed-price baseline with an agreed-upon per-trip/per-hour rate for additional trips above the baseline level of service.
3. Contract with Multiple Service Providers: This is the most complex procurement option and requires Metro to manage the provision of service with separate entities (e.g., separate agreements for vessels, operator, ticketing, revenue generation etc.).
The procurement timeline for these models ranges from 10 to 15 months depending on the complexity of the agreement and the known service variables at the time of the RFP’s development.
Considerations for Water Taxi Service
The following sections outline key considerations for establishing a water taxi service, such as service goals, minimum service requirements, labor, regulatory requirements, and funding opportunities.
Water Taxi Service Goals
Metro would need to identify service goals for a future water service to guide decisions on fare policy, emissions goals, and other service variables and confirm the focus on short-term special-event service. The lack of certainty regarding security zones and in-water events precludes the ability to finalize service goals.
Service Variables
While the Feasibility Study identified possible landing sites and service scenarios, the RFI welcomed respondents to submit responses based on their experience and expertise, allowing for recommendations not included in the initial study. As more is known about potential demand for the service, potential revenue sources, or limitations due to security zones or in-water events, Metro may decide to specify minimum requirements in an RFP for the service or make these decisions in partnership with the selected operator. Key service variables include:
• Fleet: The number and characteristics of vessels directly impact the operating cost and service levels. Responses indicated a wide range of potential vessel capacities, speeds, and customer experiences. Depending on the goals for service (i.e., transportation focus vs. tourism opportunity), Metro may want to select vessels that align with the desired service. For example, a transportation-focused route may welcome smaller vessels with an enclosed cabin that travel at higher speeds, whereas a tourism-focused service may have more interest in larger vessels with outdoor space, even if they have a longer crossing time.
• Service period: While the first phase of the study identified a 47-day minimum for Games-focused service, a new transportation option typically requires a lead-in period to prove service and attract ridership. On-time performance and reliability for ferry services are key. A lead-in period can demonstrate the service’s viability to potential customers. Some new long-term services choose to launch ahead of their peak season with free fares to attract ridership and demonstrate the reliability of the new transportation option.
• Service schedules: Because event schedules over the Games period vary day-to-day, with some events and security zones potentially impacting water taxi operations, service planning will require clarification around desires and minimum service requirements. For example, service could be scheduled on a fixed daily schedule or on a schedule that varies based on the event schedule for each day. Demand forecasts or assumptions around ridership levels are needed to identify daily and peak-period capacity requirements. Estimated one-way crossing times (assuming slow-speed travel through no-wake zones at both ends of the route) range from around 30 minutes, with a 32-knot vessel, up to around 55 minutes, with a low-speed 10-knot vessel.
• Landing sites: Confirmation of preferred landing sites is required for an operator to move forward with securing necessary agreements/permits, and to complete the design of minor improvements such as a passenger ramp and uplands queuing/signage.
Labor
Respondents demonstrated experience and openness to using unionized labor for the service, should staffers elect to organize. Vessel size was noted as a major consideration for labor costs. The major inflection point is 149-passenger vessels; above this capacity, crewing and certification costs rise significantly. For this reason, the 149-passenger vessel size is more commonly used and more likely to have market availability.
For example, three 49-passenger vessels, each with two crew members, require a total of six crew members. One 149-passenger vessel requires only three crew members, illustrating the labor cost advantage of larger vessels. Vessels between 50-149 passengers are often built to 150-passenger platform specs but certified for fewer due to specialized use (e.g., whale watching, dinner cruises).
Apart from crew operations, public ferry operators emphasized the importance of hiring at least one full-time agency staff member to manage the contract with the operator.
Regulatory Requirements
Operators identified regulatory requirements as the biggest timeline driver for service implementation, with the longest lead time requirement being the Coastal Development Permit De Minimis Waiver (2-4 months) or Coastal Development Permit (6-24 months). Given that limited shoreside improvements are needed for the service, a De Minimis Waiver or less complex permitting process would likely apply. Permitting requirements can be confirmed once vessels and landing sites are selected.
This timeline assumes that construction of a new vessel or repowering of an existing diesel vessel is unnecessary and likely infeasible. Similarly, permitting timelines associated with in-water construction mean that feasible landing site improvements are limited to installing a temporary ramp within the existing dock footprint and to uplands improvements, such as temporary queuing and signage.
Funding Opportunities
Local Return funding is an eligible source of funds for water taxi service. The City of Los Angeles, the City of Long Beach, and LA County carry fund balances (as described in Attachment B) that are eligible to fund the service.
Implementation Timeline
Considering the findings outlined above, including the absence of dedicated funding, implementation of a water taxi service by the 2028 Games is highly unlikely. However, if local jurisdictions were to allocate their Local Return funding and decide to move forward with the service, a potential implementation timeline, as requested in Motion 18, is presented in Table 3. The schedule below assumes an aggressive procurement timeline, with RFP development beginning in October 2026 and a Notice-to-Proceed issued by July 2027.
Table 3: Potential Implementation Timeline
Equity Platform
EQUITY PLATFORM
An equity analysis has not been performed as part of this study. Should this service be considered for implementation, an equity analysis will be conducted.
Vehicle_Miles_Traveled_Outcome
VEHICLE MILES TRAVELED OUTCOME
VMT and VMT per capita in Los Angeles County are lower than national averages, the lowest in the SCAG region, and on the lower end of VMT per capita statewide, with these declining VMT trends due in part to Metro’s significant investment in rail and bus transit.* Metro’s Board-adopted VMT reduction targets align with California’s statewide climate goals, including achieving carbon neutrality by 2045. To ensure continued progress, all Board items are assessed for their potential impact on VMT.
*Based on population estimates from the United States Census and VMT estimates from Caltrans’ Highway Performance Monitoring System (HPMS) data between 2001-2019.
As part of these ongoing efforts, this item is expected to contribute to further reductions in VMT. This item supports Metro’s systemwide strategy to reduce VMT through planning activities that will further encourage transit ridership, ridesharing, and active transportation, or, in this case, explore the possibility of water-based transportation to reduce automobile VMT. Metro’s Board-adopted VMT reduction targets were designed to build on the success of existing investments, and this item aligns with those objectives.
Implementation_of_Strategic_Plan_Goals
IMPLEMENTATION OF STRATEGIC PLAN GOALS
The Water Taxi RFI and reverse pitch effort support the following strategic plan goals:
• Goal #1: Provide high-quality mobility options that enable people to spend less time traveling;
• Goal #2: Deliver outstanding trip experiences for all users of the transportation system; and
• Goal #4: Transform LA County through regional collaboration and national leadership.
Next_Steps
NEXT STEPS
Staff, will continue to monitor any changes to the conditions that would impact the delivery, financing, and contracting options presented in this report.
Attachments
ATTACHMENTS
Attachment A - Motion 18
Attachment B - Review of Water Taxi Funding Opportunities
Attachment C - Comparison of Fares
Prepared_by
Prepared by:
Jewel DeGuzman, Senior Manager, Office of Strategic Innovation, (213) 922-5343
Jacob Wessel, Senior Director, Office of Strategic Innovation, (213) 922-5475
Allison Yoh, Senior Executive Officer, Countywide Planning & Development, (213) 922-4812
Monica Bouldin, Deputy Chief Customer Experience, (213) 922-4081
Reviewed_By
Reviewed by: Seleta Reynolds, Chief Innovation Officer, (213) 418-3034
Conan Cheung, Chief Operating Officer, (213) 922-4656
Ray Sosa, Chief Planning Officer, (213) 547-4274
Jennifer Vides, Chief Customer Experience Officer, (213) 922-4060
