Auditing the ferry system
Consider the decades-long effort to replace the octogenarian Steel-Electric-class ferries, four vessels put out to ferry pasture in 2007. Coupled with nine Baby Boom-era boats, replacement ferries are a central concern for transportation planners. So why are the new, state-manufactured ferries so pricey relative to similar ferries around the country?
The question was brought into focus with the State Auditor's Office release of a performance audit on vessel construction costs. As The Herald's Jerry Cornfield reported on Wednesday, state lawmakers are also demanding answers to system-related factors, in particular, vessel overdesign, which goose overhead. Regarding the audit, Cornfield writes, "It examined construction costs of the three newest vessels, the 64-car ferries in the Kwa-di Tabil class, and the three Jumbo Mark II boats built in the 1990s, which carry 202 cars each.
On four of those boats, the auditors found the state shelled out between $7.5 million and $42.2 million more per ferry when compared with comparable vessels, after accounting for design differences." One of the more jarring examples is the Chetzemoka ferry. Washington paid nearly $80 million for the 64-car ferry. Contrast that with the 76-car Island Home, a ferry that transports passengers to Martha's Vineyard and Nantucket, which came in at $43.4 million.
The audit's bottom line is that WSF pays more compared to other purchasers because of Built in Washington laws and other regulatory requirements. The audit flags four key leading practices that could curtail costs, including use of a fixed-price contract, that the design gets wrapped up and reviewed before construction begins, and that owners place all responsibility on the contractor to deliver project quality, holding the shipyard accountable.
That's a good start. Other approaches include appointing a ferry-system CFO to watchdog every penny (the ferry system began as a private enterprise, merging into the Puget Sound Navigation Company before being sold to the state in 1951.) Flexibility on bidding would also ratchet down costs.
Fortunately, state Rep. Norma Smith is spearheading a call for an additional audit to determine the actual post-delivery costs of decisions related to design and construction. We know the price drivers; now, it's critical to evaluate the fallout of those WSF decisions, from fuel efficiency to vibration concerns. Washingtonians deserve assurance that we don't repeat the same mistakes.