Published: Tuesday, March 3, 2009
Ferries: fewer boats, higher fares, car tax?
OLYMPIA -- Building fewer boats, raising fares and reinstating the dreaded statewide motor-vehicle excise tax are the best options for keeping the financially strapped state ferry system afloat, legislators heard Monday.
These recommendations drawn from studies ordered by the Legislature will help lawmakers eventually craft a plan for piloting Washington State Ferries out of deficit-riddled waters into a future of long-term solvency.
"Now that we have all of our research we have to put in place what we want to fund and then figure out if we have enough money to fund it," said state Sen. Mary Margaret Haugen, D-Camano Island.
Washington State Ferries in December concluded that it faced a $3.5 billion deficit by 2030 if it maintained service at current levels, increased fares annually by 2.5 percent, and built nine boats needed to fill gaps on routes and replace aging vessels.
On Monday, Haugen and nearly two dozen House and Senate members considered recommendations from the Cedar River Group to build five boats instead of nine in the next 16 years and erase a large chunk of that deficit. Three of the vessels should be of the 64-car Island Home class and two of the larger 144-car ferries, consultant Kathy Scanlan recommended.
Scanlan outlined other cost-cutting moves, too, including spending less on fuel by reducing vessel speeds on some runs.
Then the state Transportation Commission put forth its ideas on how to generate the revenue to cover shortfalls foreseen in the ferry system.
A fare hike of 4 percent plus an additional surcharge in summer months would generate enough money to cover Washington State Ferries' operating budget, commissioners concluded in their report. Reinstating the vehicle excise tax, at a rate of $21 for a vehicle worth $10,000, could provide funds to build boats, the report found. Before it was repealed, Washington drivers paid the tax yearly as part of vehicle registration.
The motor vehicle excise tax was a major source of ferry revenue eliminated by the Legislature in 2000 following voter approval of Initiative 695.
"We know it was not a popular tax when it was repealed," commissioner Richard Ford told the assembled lawmakers.
With a little more restraint in its application, people will understand it is for an important service, he said.
Lawmakers made no decisions Monday, stepping most gingerly around the politically volatile subject of bringing the excise tax back.
"I see that as the last thing we could ever do," said Haugen, chairwoman of the Senate Transportation Committee.
Rep. Judy Clibborn, D-Mercer Island, Haugen's counterpart in the House, said the Legislature won't resolve the funding issue this session.
"We start with the cuts and figure out what we need," she said. "We are going to have to look at statewide revenues for all of transportation, not just ferries, in the next couple of sessions. All of these ideas are on the table."
Secretary of Transportation Paula Hammond is letting lawmakers wrestle with the commission's suggestions.
"(Commissioners) have thoroughly looked at funding options and probably have not found one source that everyone can support," she said. "Now, I think it's in the legislative arena."
Fare increases will be difficult, too.
They are "absolutely necessary, but what rate is appropriate" needs to be figured out, said Rep. Marko Liias, D-Mukilteo, noting he wasn't warming to the excise tax idea.
What he did like reading in the hundreds of pages of reports is Scanlan and state ferry officials' support to move the Mukilteo ferry terminal. There have been worries that the much-delayed project would be dropped altogether from the state's long-term transportation plans.
But Scanlan recommends saving some money by not adding overhead loading for foot passengers -- meaning they would, as they do now, walk on via the car deck.
"Relocating the terminal is probably my highest priority," Liias said.
Jerry Cornfield: 360-352-8623, jcornfield@heraldnet.com.
These recommendations drawn from studies ordered by the Legislature will help lawmakers eventually craft a plan for piloting Washington State Ferries out of deficit-riddled waters into a future of long-term solvency.
"Now that we have all of our research we have to put in place what we want to fund and then figure out if we have enough money to fund it," said state Sen. Mary Margaret Haugen, D-Camano Island.
Washington State Ferries in December concluded that it faced a $3.5 billion deficit by 2030 if it maintained service at current levels, increased fares annually by 2.5 percent, and built nine boats needed to fill gaps on routes and replace aging vessels.
On Monday, Haugen and nearly two dozen House and Senate members considered recommendations from the Cedar River Group to build five boats instead of nine in the next 16 years and erase a large chunk of that deficit. Three of the vessels should be of the 64-car Island Home class and two of the larger 144-car ferries, consultant Kathy Scanlan recommended.
Scanlan outlined other cost-cutting moves, too, including spending less on fuel by reducing vessel speeds on some runs.
Then the state Transportation Commission put forth its ideas on how to generate the revenue to cover shortfalls foreseen in the ferry system.
A fare hike of 4 percent plus an additional surcharge in summer months would generate enough money to cover Washington State Ferries' operating budget, commissioners concluded in their report. Reinstating the vehicle excise tax, at a rate of $21 for a vehicle worth $10,000, could provide funds to build boats, the report found. Before it was repealed, Washington drivers paid the tax yearly as part of vehicle registration.
The motor vehicle excise tax was a major source of ferry revenue eliminated by the Legislature in 2000 following voter approval of Initiative 695.
"We know it was not a popular tax when it was repealed," commissioner Richard Ford told the assembled lawmakers.
With a little more restraint in its application, people will understand it is for an important service, he said.
Lawmakers made no decisions Monday, stepping most gingerly around the politically volatile subject of bringing the excise tax back.
"I see that as the last thing we could ever do," said Haugen, chairwoman of the Senate Transportation Committee.
Rep. Judy Clibborn, D-Mercer Island, Haugen's counterpart in the House, said the Legislature won't resolve the funding issue this session.
"We start with the cuts and figure out what we need," she said. "We are going to have to look at statewide revenues for all of transportation, not just ferries, in the next couple of sessions. All of these ideas are on the table."
Secretary of Transportation Paula Hammond is letting lawmakers wrestle with the commission's suggestions.
"(Commissioners) have thoroughly looked at funding options and probably have not found one source that everyone can support," she said. "Now, I think it's in the legislative arena."
Fare increases will be difficult, too.
They are "absolutely necessary, but what rate is appropriate" needs to be figured out, said Rep. Marko Liias, D-Mukilteo, noting he wasn't warming to the excise tax idea.
What he did like reading in the hundreds of pages of reports is Scanlan and state ferry officials' support to move the Mukilteo ferry terminal. There have been worries that the much-delayed project would be dropped altogether from the state's long-term transportation plans.
But Scanlan recommends saving some money by not adding overhead loading for foot passengers -- meaning they would, as they do now, walk on via the car deck.
"Relocating the terminal is probably my highest priority," Liias said.
Jerry Cornfield: 360-352-8623, jcornfield@heraldnet.com.
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