Port Stanley residents fear it could end up being controlled by foreign interests. Transport Canada has edged closer to selling Port Stanley harbour to the highest bidder, a possibility residents fear could leave the harbour controlled by Americans or Europeans investing in a ferry.

The federal department this fall announced its intention to auction the harbour in a letter to parties that had expressed interest in buying it.

But the prospect of Canada's deepest Lake Erie harbour being sold to foreigners angered locals, who had tried to buy and operate it through a non-profit company.

"That (letter) just sent everyone into orbit. (The harbour) is a Canadian natural resource and should be treated as such," said Helen LeFrank, a Port businessperson who forged the non-profit group out of a disparate group of residents, businesses and fishers. "If taxpayers don't own the harbour, who's to say who can use it and who can't."

But hope, not just fear, is on the horizon for a harbour Ottawa acknowledges it hasn't fully maintained since 1995 when it announced plans to sell its ports.

Transport Canada has offered to bargain with Elgin County and the municipality of Central Elgin before it resorts to a public auction.

While similar negotiations four years ago failed when Ottawa wouldn't pay enough to subsidize the money-losing harbour, this time, a ferry initiative could make a difference.

The Cleveland-Cuyahoga County Port Authority has teamed up with a Dutch ferry company, Royal Wagenborg, to try to shuttle both passengers and cargo across the lake.

While prior efforts to launch a Port Stanley ferry went belly up, leaving Elgin investors in the lurch, this one will succeed, said Gary Failor, executive director of Cleveland's port authority.

"There is some skepticism and rightly so," said Failor, who was in Elgin last week to introduce Royal Wagenborg officials.

"But all the previous proposals involved operators who were under-capitalized and inexperienced," Failor said.

That's not the case with Royal Wagenborg, a 106-year-old company that employs 2,200 people and operates more than 160 vessels, from ferries to freighters.

The Cleveland port has spent $1 million US on a feasibility study and expects to get $36 million over the next six years once the U.S. Congress passes its transportation bill this spring.

The Cleveland study projects the venture would pay $31,250 a month before taxes, or $375,000 a year, to use the Port Stanley harbour.

That's enough to cover a big chunk of what had been the harbour's yearly deficit of about $500,000 four or five years ago, when maintenance costs were about $700,000 and revenue was about $200,000.

The recent record at the publically-financed harbour is murky because Transport Canada won't disclose the harbour's balance sheet, only acknowledging its deficits may be a little higher than $500,000.

"It's confidential," said Susan Johnston, who has managed the selling of Ontario ports for Transport Canada.

Transport Canada will share the bottom line with Elgin County and Central Elgin officials, but only if they don't share it with constituents.

While the saga of Port Stanley harbour has played out, the Cleveland Port Authority has been forced to wait for a partner because Transport Canada had declined to discuss a ferry to a harbour it intends to sell.

The Cleveland authority hopes with Royal Wagenborg on board, a sale to Elgin County and Central Elgin comes quickly -- delays could threaten the plans to have ferry service by spring 2006.

Sylvia Hofhuis, deputy mayor of Central Elgin and an Elgin County councillor, hopes a deal will be struck that will avert a public auction.

If an auction does occur, the Cleveland authority won't bid unless Elgin County and Central Elgin officials ask them to, Failor said.

OBSTACLES TO A SALE

- The harbour has been losing at least $500,000 a year. Ottawa hasn't offered local governments enough to take it over.

- Dredging that is supposed to be done once every three years has been done once since 1995, when Transport Canada started selling ports.

- The Walpole Island First Nation has a claim before court for water rights, a claim that could impede a sale.

- Twenty-two individuals and businesses expressed interest last year to Transport Canada, which insisted all join a single entity by Nov. 30 if a deal was to be done. A U.S. consultant and a consortium of numbered Ontario companies held out for a year and Transport Canada declined to proceed.