In 2010 I directed my office and the Department of Transportation and Public Facilities (DOTPF) to “defederalize” the new Alaska Class Ferry project.

Back then, I said: If we can build an Alaska ferry with all-Alaska dollars, we’ll have a better shot at building it with an all-Alaska workforce.

The state subsequently returned the federal dollars for the project and embarked on a new approach to get Alaska Marine Highway vessels built at home.

Our challenge now is to get vessels built in Alaska, by Alaskans, while being wise stewards of public dollars.

Recently, it became clear that building a 350-foot Alaska Class Ferry for the budgeted $120 million is simply not feasible. Between design, engineering, project management, and construction, the cost for one ferry of that length will run between $150 - 167 million.

That realization gave us an opportunity to rethink the needs of the system, and look at alternatives for improving ferry service with the dual goals of building ferries at home while also staying on budget.

Last week I announced a new direction to achieve both goals.

I directed DOTPF Acting Commissioner Pat Kemp to have department personnel engage in discussions with Vigor Industrial and the Alaska Shipyard on how more than one ferry can be built with the $120 million appropriated by the Legislature. I requested they look at smaller, more efficient vessels than have been discussed to date.

In fact, we believe we can build at least two smaller ferries, and by doing so, improve service throughout the region while staying within the original budget.

The state has an obligation to be smart with the people’s money, while bringing the very best service and product possible. With declining oil production and, consequently, declining state revenue, Alaska has to be even more careful with available funds.

I have supported and will continue to support the increased service currently scheduled for mainliners from Bellingham all the way out to the Aleutians. However, this desire must be balanced with the reality of increasing costs for the maintenance of our aging fleet.

That’s why we need to expand our fleet strategically. The benefit to this new approach is clear: smaller ferries mean shorter building times, bringing them online more quickly, and allowing the system to run them more frequently, and at a lower cost.

Smaller ferries can reduce port time and provide greater redundancy in the event of a mechanical problem with another vessel. In addition, smaller vessels can be more easily deployed to respond to special community events in Southeast.

This new approach can keep Alaska shipwrights busy for years to come. In the future, we also will need to build a new Gulf-crossing ferry to replace the Tustemena, and we’ll need to continue to modernize our fleet. Growing our workforce capabilities to build and maintain these vessels will provide pathways of opportunity that can grow spinoff enterprises throughout the region.

Since 1963, our Alaska Marine Highway System has traveled these waters, safely transporting hundreds of thousands of Alaskans. My commitment to the system remains strong, and the direction we are taking affirms the importance of our marine highways.

• Parnell is the governor of Alaska.