Old ferries gone for good

Published 9:55 pm Thursday, December 13, 2007

SEATTLE — Gov. Chris Gregoire on Thursday said the state has no choice but to abandon the nation’s oldest saltwater ferries and that continuing to rely on their leaking, corroded hulls was courting disaster.

“As difficult as it has been, imagine, just imagine, what might have been the consequences if they had not been removed and a tragedy had occurred,” Gregoire said.

The Steel Electric-class ferries were launched in 1927, the year Charles Lindbergh completed the first solo flight across the Atlantic. They were running until Nov. 20, when state officials pulled them from service.

Gregoire said she will ask the Legislature in January to approve shifting $100 million among ferry system projects to pay for construction of three new boats that will serve as replacements.

She also signed contracts on Thursday to build up to three 144-car ferries, vessels too large to replace the Steel Electrics, but destined for use on other runs, including Mukilteo.

While new ferries are being built, the state will lease a vehicle ferry owned by Pierce County, a move that should fully reopen the Keystone-to-Port Townsend ferry run, perhaps as early as January.

“That’s just exactly what we asked for,” said Bob Clay, a city councilman in Coupeville on Whidbey Island, and chairman of the board of Island Transit. “I think that’s excellent. It appears to me that it’s the proper decision to make. I can’t see putting any more money into 80-year-old boats that have to be replaced.”

Gregoire made her announcements at a Seattle shipyard where two of the Steel Electrics — the Quinault and Illahee — are in dry dock. The old ferries were undergoing repairs. Now that work has stopped.

“We’re going to button it up,” state Transportation Secretary Paula Hammond said. “We’ll salvage everything that we can salvage.”

The Steel Electrics have been leaking for years, but they’ve faced increased scrutiny from the Coast Guard and others this year after a series of problems.

Hammond ordered the ferries tied up just before the Thanksgiving holiday travel rush after crews working on the Quinault told her they discovered extensive corrosion of riveted steel plates deep in the hulls.

The move cut the direct transportation link between Keystone on Whidbey Island and Port Townsend on the Olympic Peninsula.

Gregoire said Pierce County officials agreed to lease the state one of its two ferries for about 14 months. That’s when she wants new ferries on the water.

The 54-car, steel-hulled ferry Christine Anderson is a Steilacoom-class ferry of similar design to the new boats Gregoire wants built to replace the Steel Electrics. The ferry has been undergoing an engine overhaul, but it should be ready to hand over to Washington State Ferries in early January, according to Toby Rickman, deputy director of public works and utilities for Pierce County.

“We’re nice people,” he said. “This is a challenge for all of us. I think we all recognize that this is a transportation challenge for the state of Washington. It’s a time for counties and the state to work together to meet the needs of the citizens of Washington. And we’ve got a boat available that can be used in this way to help out with this emergency they’ve got. It’s just the right thing to do.”

The prospect of getting vehicle-ferry service restored soon was great news in Port Townsend, which has struggled because of lost ferry service.

“I couldn’t anticipate a better outcome other than a new boat,” Port Townsend Mayor Mark Welch said. “This is certainly as good as we can expect. I’m very pleased.”

C.J. Colbert, owner of Mud Cat espresso and gifts in Port Townsend, is relieved. Her business has dropped 50 percent since the vehicle ferry runs were stopped.

“When they said car-service (would be out until) March, February or a year, that was enough to make the head come off the top of my shoulders,” she said. “It’s a wonder I was able to hold on to it.”

Gregoire spoke before she signed contracts for the construction of the three new 144-car ferries.

The state has been negotiating terms of the contract with a consortium of shipbuilders, including Todd Pacific Shipyards, J.M. Martinac Shipbuilding Corp. of Tacoma, and Nichols Bros. Boat Builders of Freeland.

Money to build three new boats to replace the Steel Electric ferries could come from shifting $36 million in funding for planned improvements to ferry terminals, including a key project in Mukilteo, Gregoire said.

Another $64 million could be shifted from the $348 million already set aside to build the 144-car ferries.

The new plan would be to build three of the larger ferries, not four, she said.

Although the ferry system already has spent $67 million buying four diesel engines for the large ferries, Gregoire on Thursday said the premise was always to build “up to four boats.”

“We’ve never, ever said how many would be built,” she said.

Retiring the Steel Electrics will cost the state at least $3 million that is not currently covered under any budget. That’s because the boats also are floating tax shelters, subject to lease agreements entered into during the 1980s that offered their depreciation to investors and require the state to keep the Steel Electrics on the water, some until 2014, or face penalties.

The state received close to $25 million under the lease agreements, said Amy Arnis, assistant secretary for strategic planning and finance for the state transportation department.

The leases are “not addressed in the governor’s budget,” she said. “We are investigating with the attorneys the possibility of transferring the (leases) to some other vessels, if possible.”

Seattle attorney Jed Powell, who represents Martinac, has for years raised questions about the leases and the safety of the Steel Electrics. At times the disagreements have been strident enough to produce litigation.

Powell said he’s pleased to see the state moving to address problems.

“They finally have agreed to what was obvious to Martinac 10 years ago,” he said.

The state wasn’t pressured by the Coast Guard into deciding to abandon their oldest boats.

“We looked at them and told them what needed to be fixed on those boats, and the cost-benefit analysis was theirs,” said Lt. Cmdr. Todd Howard, head of the vessel inspection team in Seattle.

House Majority Leader Lynn Kessler, D-Hoquiam, said she was thrilled to see the governor take steps to address ferry problems, but she hopes the state learns from the crisis.

“I’m so tired of this,” she said. “I do think we still need to look at how we got here.”

State Rep. Barbara Bailey, R-Oak Harbor, said Gregoire shares the blame.

“Why don’t we have the boats now? This is not something we didn’t know about,” she said.

GOP gubernatorial candidate Dino Rossi also blamed Gregoire.

“It is inexcusable. The people who live in the affected areas, and all the taxpayers of Washington state, deserve answers for how this mess came to be,” Rossi said.

Hammond said the state now needs to decide what to do with the Steel Electrics. The ferry system doesn’t have a procedure for retiring ferries and she is open to ideas, she said.

“Someone said sink one for a dive park,” she said.

Herald writers Jerry Cornfield and Jim Haley contributed to this report.

Reporter Scott North: 425-339-3431 or north@heraldnet.com.