SE Conference studies ferry system structure

Posted: Thursday, May 23, 2002

Although the Legislature recently found $20 million to restore the Marine Highway Fund, the Southeast Conference is proceeding with a study of how the management of the ferry system might be changed to ensure financial viability over the long term.

"That extra $20 million won't last them too long," said Loren Gerhard, executive director of the private, nonprofit organization that advocates for transportation needs in the Panhandle. "I think it buys them a couple of years."

The conference just released a preliminary draft of a $30,000 study by the McDowell Group of Juneau and Anchorage, a research and consulting firm.

The study, due for completion in July, will be used to attract federal funding for a comprehensive analysis of the ferry management structure that could cost up to $300,000, Gerhard said.

"Our work is not intended to be a criticism of individuals involved in the status quo," he wrote in an open letter to ferry riders. "We are seeking a fix to a system, not to accomplish a personnel change."

Gerhard said the idea is to end the constant state of tension between the Legislature and the Alaska Marine Highway System, a division of the Department of Transportation.

"We think a change in the structure may facilitate a fresh look at how the system is operated," he said. "We want to try to remove the political football nature of the Marine Highway System."

A marine highway authority outside of DOT, as proposed by Republican Sens. Jerry Ward of Nikiski and Robin Taylor of Wrangell, might be the solution, Gerhard said. Ward has suggested giving the authority 500,000 acres of land to generate revenue.

But Bob Doll, DOT's Southeast region director, has said the department might feel less urgency to channel federal highway funds toward an independent marine authority.

The preliminary McDowell study notes DOT has proposed a new model for service, with fast vehicle ferries acting as dayboats, lowering crew costs and making direct connections between "hubs" - economic centers in the region - and "spokes" - small, outlying communities.

"However, to implement these recommendations without also looking hard at the operating entity charged with making them work and the financing mechanisms that will keep them solvent is to set the stage for failure," the study says.

"The SATP (Southeast Alaska Transportation Plan), itself, was developed within the system that produced the current malaise and may be expected to reflect that system's limitations. These include limited understanding of markets and marketing, susceptibility to political pressure and a general lack of private sector experience in setting and achieving financial performance goals."

Capt. George Capacci, general manager of the ferry system, said it welcomes a fresh look and constructive criticism, and it understands its role in the region's economic development.

"We are trying to run a transportation system that was designed in the early '60s and it's not perfect," he said.

Capacci said the study should take into account safety, security, environmental and other regulations the ferry system must follow. Those rules set the number of crew required in emergencies and schedules of vessel overhauls, for example.

"Those safety requirements are important to any sustainability of a marine highway system," Capacci said.

Gerhard said the idea is to recommend to the Legislature in 2003 what the Southeast Conference believes to be the best management model for the ferry system. That recommendation won't include vehicle types and routes, but will be a suggestion of how best to make those decisions, he said.

Two fast ferries, a Sitka-Juneau dayboat and a vessel for Prince William Sound, have been funded by the Legislature, and a New York shipyard has a $68 million contract with the state for their construction. The Legislature also has approved partial funding of $12 million for a second fast ferry in Southeast, which would connect Ketchikan and Petersburg.

"In my opinion, it's a bit of a 'Hail Mary' pass to have a whole fleet of those before you have a vessel in the water to see if it works," Gerhard said.

Bill McAllister can be reached at

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