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Mat-Su officials ponder expensive ferry's fate

$80 million later, project won't float financially

Posted: August 1, 2012 - 11:06pm

ANCHORAGE — The Mat-Su Borough’s once-prized ferry boat was finished months ago but it remains docked hundreds of miles away near Ketchikan. Now the Borough Assembly is actively debating what to do with the unique and expensive ship.

Give it away? Sell or lease it? Maybe, some borough leaders say, the vessel could still be put to work as a commuter ferry, if the thorny problem of no place to land on either side of Knik Arm could be resolved. And while that’s being worked out, some want to explore whether the boat could be beached for cheap on Mat-Su port land.

The ship is the Susitna. It began as a Navy prototype of a military assault vessel, with a deck that can rise for faster sailing and lower for beach landings. It’s the world’s first twin-hulled vessel that can break through ice. Most of its roughly $80 million cost came from federal earmarks and Navy research dollars. Now it’s the borough’s responsibility.

Borough Assembly members are trying to come to grips with the reality that their free ship is costing the borough taxpayer money.

At its July 17 meeting, the Assembly was hit with the latest estimate: nearly $67,000 for a month’s worth of docking, security, utilities and maintenance. To bring the ship from Ketchikan to Port MacKenzie would cost $125,000. Just studying whether it could be safely beached or dry docked would cost another $20,000 to $60,000, and that doesn’t count whatever special equipment would be needed to cradle the vessel.

The Assembly hasn’t set out a clear path to solve its ferry problem. Assemblyman Steve Colligan recently called it a “hairball,” a nasty mess impossible to untangle.

“Two things we know for certain about this boat,” Assemblyman Warren Keogh said at the Assembly’s July 17 meeting, according to a recording. “We don’t know where we’re going. We’ve been groping around for some time. ... The other thing we know for sure: This is becoming an increasingly money-sucking experience.”

Beaching a treasure?

Assembly members have made it clear they are tired of paying the bills for a ship that most residents have never seen and that is providing no benefit.

Borough manager John Moosey put a resolution on the July agenda to list the vessel as surplus property on the Federal Register or sell it through a specialized ship broker.

“All our attempts as staff have been to stop the cost of the ferry and move it into a happier home,” Moosey said at the meeting.

Some money for the ship came from Federal Transit Administration grants that hinge on it becoming a commuter ferry. Moosey told the Assembly that the federal government could ask the borough to repay $8.5 million that went directly into the ship. Still, if the borough sells the ship, or if it becomes federal surplus, the obligation is “mitigated,” Moosey said.

The Assembly isn’t ready to give up. It voted to put aside Moosey’s proposal until mid-September, to give him more time to work on other options.

Even if the borough decides to sell or give away its ship, that could take months at a cost of $700,000 or more for a year of docking in Ketchikan, Colligan said.

Assemblyman Ron Arvin pushed for a study of how much it would cost to bring the ship to Port Mac and beach it, which could avoid huge docking fees.

“Skyscrapers are moved, for God’s sakes. A space shuttle is moved around. Surely we can pick that small vessel up and put it on the beach,” Arvin said.

Not so fast, said Lew Madden, a retired Navy captain and co-inventor of the ship who also has worked for the borough as a consultant for the ferry.

He said in a telephone interview Tuesday with the Anchorage Daily News that the ship’s twin hulls aren’t structured to take the strain of beaching, and he wouldn’t recommend doing so.

“It’s designed to land people on the beach from the bow and not stay there, not rest on the beach. The shape of the hull and so on doesn’t really permit this. And there’s a lot of things on the bottom of the hull that would get crushed, if you let it sit on the beach,” Madden said. “I don’t think it’s possible to do it and use the ship again.”

The borough should consult with the vessel’s naval architect, Guido Perla, for further analysis, he said.

Still zero landings

The Mat-Su Port Commission voted unanimously for the borough to bring the ship to the Mat-Su, port panel member Dave Cruz said at the July Assembly meeting. Neither Port MacKenzie nor the Anchorage side have landing structures to accommodate a car ferry. The borough says it doesn’t have the money in hand to build them.

Applications for permits are pending before the Army Corps of Engineers, according to borough spokeswoman Patty Sullivan. The municipality of Anchorage, which has gone back and forth over the idea, now supports a landing near Ship Creek and outside of the Port of Anchorage, if the regulatory hurdles can be cleared, said Lindsey Whitt, spokeswoman for Mayor Dan Sullivan.

Cruz said he doubts ferry landings would be as expensive as the borough’s latest estimate of $30 million for two of them. He said the Susitna is a “beautiful vessel” and noted that the borough spent another $4.5 million on a ferry terminal going unused. Make good on the inherent promise, he said.

Sale or sail?

Darcie Salmon is a former borough mayor who has been on the Assembly since October representing the Mat-Su area that includes the port. The ferry belongs at Port MacKenzie, he said. But he is frustrated at the complications and delays.

“If we can’t use it in Anchorage, maybe we can run it in Tyonek or run it to the Kenai or use it for logistic purposes in the Cook Inlet,” he said. “But to just trash can it and throw it away or sell it or get rid of it before we ever put it to use ... it’s just the sensibility of it.”

Because of the Navy’s desire to make it a fast ship, it became smaller and can’t hold as many vehicles, or as much cargo, as the borough wanted. Contractors for Cook Inlet Region Inc.’s wind farm on Fire Island checked into using the vessel to haul equipment, but it wasn’t big enough.

Moosey, the manager, asked the Assembly in July which direction he should take: Sell it, cut the losses, or try to make the ferry a ferry. Among other things, the borough sought proposals from private groups for the ferry and also examined whether the Alaska Marine Highway system could use it. In the end, Moosey said he would keep looking at options.

“We need to make our minds up,” borough Mayor Larry DeVilbiss said Tuesday. “Because I think we’re giving the manager kind of mixed directions.”

He put the ferry project on the Assembly agenda for Aug. 9. The mayor is skeptical the ship will ever become a working ferry for the Mat-Su.

“I’d be surprised at this point if it is,” DeVilbiss said. Even if the other issues could be worked out, its smaller-than-desired capacity makes it less economical to run. “We didn’t end up with something that penciled out like the original plan.”

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