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Alaska editorial: Ripple effect

Posted: January 20, 2013 - 12:11am

This editorial first appeared in the Ketchikan Daily News:

It seemed like smooth sailing toward updating the Alaska Marine Highway System ferry fleet until early December. Now, it’s unclear what the ripples in the water represent, but it is a cause of unease in Ketchikan.

Bert Stedman, R-Sitka, representing Ketchikan and District Q had, while in the powerful position of co-chair of the state Senate Finance Committee, worked with the administration and House to secure $120 million for the first of the Alaska Class ferries. The potential of more than one had been discussed. Another $50 million had been secured for a second new ferry.

Ketchikan fully expected all of the ferries to be built at Alaska Ship & Drydock, bringing at least a dozen years of business to the shipyard and the community. Additionally, 129 full-time, year-round, high-paying jobs at the shipyard and another 76 jobs in businesses providing goods and services to the yard had been projected.

It was believed that the Alaska ships should be built at a State of Alaska-owned shipyard. It seemed nonsensical for a shipyard owner to utilize another shipyard.

For that result, the state had returned federal funds destined for the first ferry. The rules that apply to federal projects disappeared.

Then the state adopted a procurement method — construction manager/general contractor — in proceeding with the ferry project and Ketchikan Shipyard.

Elliott Bay Group — the ferry designers — the state Department of Transportation and the shipyard had been working on the final ferry design. That design was scheduled to be completed in the upcoming summer. It would be followed by a maximum price proposal from Alaska Ship & Drydock.

But the estimated cost of building the first ferry began to significantly exceed what Stedman had made available, the latest estimate being between $150 million and $167 million. That, combined with the operating cost that included a crew of between 21 and 25, caused DOT to re-evaluate the ferry project.

State officials decided to scrap the Alaska Class Ferry concept. Gov. Sean Parnell, along with DOT Commissioner Pat Kemp, announced the decision to a stunned audience at the Greater Ketchikan Chamber of Commerce weekly luncheon Dec. 4.

In one of Alaska’s most fiscally and politically conservative communities, no one applauded when Gov. Parnell stated the decision would save the state money.

Instead, that queasy feeling acquired in rough seas set in collectively throughout the luncheon crowd and the community.

DOT planned to build two smaller ferries (between 250 and 300 feet), neither of which would be large enough to replace the 1960s-built, 350-foot, mainline ferries. The age of those ferries prompted the concern that initiated the new-ferry project. That those ferries provide the lucrative Ketchikan-Bellingham service was a consideration.

The state has not subjected the administration’s new direction to the same economic analysis that it applied to the Alaska Class concept.

DOT has held up this analysis as proof that the Alaska Class ships would not save money. However, the report states the only way AMHS will save money is by significantly reducing the size of the fleet.

DOT says it will do this type of economic analysis for the proposed smaller ships once the design is available.

Parnell says he believes two smaller ships could be built for $120 million. Not only will any cost for them undoubtedly increase, but it will never be less expensive than it is in the early part of this decade to build and replace aging mainline ferries. Delays only increase the cost. Of course, delays in new ships also mean the increased likelihood of necessary repairs, which would be expected to take place at the state’s shipyard in Ketchikan.

Meanwhile, DOT has the Juneau Access Improvement Project on its schedule, with a $520 million pricetag. That’s one price. Other prices likely will be forthcoming.

The Juneau road would be a surfaced highway; the Alaska Class Ferry is a marine highway. It’s highways and highways, transportation and transportation. Both are important to Southeast transportation. But, the Alaska Class Ferry price sounds like a good deal compared to the Juneau project.

Public hearings are scheduled in 2013 on the project that would improve the transportation system to and from Juneau within Lynn Canal. A final supplemental Environmental Impact Statement and a Federal Highway Administration Record of Decision are scheduled to be released, according to the DOT website for Alaska’s Southeast Region.

This isn’t to say that the Juneau project isn’t worthwhile. It is. But, it’s interesting that the new, smaller (hopefully less expensive) ferry will be utilized in Lynn Canal where a (much-more-expensive-than-an-Alaska-Class-ferry) road will be built.

It also begs the question of what happens when state officials determine that road project is too expensive.

It was pleasing when the Parnell administration came into office that it continued on the course set by the Murkowski administration in regard to ferry replacement. But Parnell says the project has evolved from its original small-boat concept into the larger Alaska Class project. Such a statement indicates Parnell is trying to keep what he views as the original concept on course. But through the years it seems like the idea of replacing ferries takes a new turn with each change at the helm.

The recent announcement that the captain in charge of the Marine Highway System, Michael Neussl, is retiring — not shortly after Parnell’s December speech to the Chamber — adds to the ripples surrounding the ferry replacement project.

Part of the problem with changing course, regardless of the reason, is that it creates a certain amount of apprehension. With Ketchikan’s experiences when the state studies and then changes direction and studies again, i.e. the Gravina Access Project over the past couple decades, it isn’t surprising the community is wondering what’s next.

It had been full speed ahead with the Alaska Class Ferries from Ketchikan’s perspective. Maybe the community expected more than had been promised. But whatever the case, there is a nervousness, and it is hoped the Parnell administration can make enough progress with its new plan of two small ships to replace one large one — or is it three large ones? — to calm the sea of concern.

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