Editorial: State needs quicker route for its new ferries

By The Herald Editorial Board

Any shipyard in a storm?

Washington state may drop its long-followed “Build in Washington” requirement for construction of vessels for the Washington State Ferry system — including five new “plug-in” electric hybrid ferries — opening up those bids to shipyards nationwide in order to more quickly build up its fleet of aging boats.

Of WSF’s current fleet of 21 ferries, 11 vessels are more 40 years old, with three launched in the late-1950s and early-1960s. Maintenance demands, the occasional accident and staffing problems during the pandemic have made it difficult for the ferry system to keep routes moving with the preferred number of boats. Earlier this month, the ferry system announced that it is not likely to restore service between Anacortes and Vancouver Island in British Columbia — a popular tourist route in summer — until at least 2030 because the one ferry certified for international waters is needed on other routes.

And after the State Department of Transportation and the Seattle shipbuilder Vigor couldn’t come to terms on a contract for those next five 144-vehicle, 1,500-passenger ferries last summer, the arrival of the first of those ferries — the Wishkah — has been pushed back until at least 2027.

Which is why the state Legislature, with just a month left in the regular session, is considering legislation that would drop rules that require ferries be built in Washington state.

“We have aging boats, so it is urgent for us to acquire new vessels to keep this system iconic and moving forward,” said state Sen. Marko Liias, D-Everett, chair of the Senate transportation committee and sponsor of the legislation under consideration, Senate Bill 5760. “We need these vessels on board as quickly as possible, ideally still built in Washington.”

Critics of the state shipyard mandate at a public hearing Monday faulted the requirement as “protectionist” and said it had resulted in increased construction costs for ferries.

Tom Thiersch, a Port Townsend resident and chair of Jefferson County’s ferry advisory committee, supports dropping the mandate, believing that opening up bids to shipyards nationwide could allow the state to get seven ferries — instead of five — for the $1 billion the state has allocated for the new electric hybrid boats.

“The Build in Washington mandate has and will increase the cost per boat by about 50 percent while being of little to any long-term benefit to our state,” Thiersch said. “The clearest example is from 2009 and 2010 when (WSF) spent $65 million a piece to build three 64-car boats of the same design that had been built in Mississippi for $33 million each only a few years before.”

But construction cost shouldn’t be the only consideration, as was the intention of the Build in Washington program, said Jeff DeVere, with Nichols Bros. Boat Builders and Everett Ship Repair.

A 2016 report by the Washington State Institute for Public Policy, DeVere said, found that ending the state shipyard requirement would have caused the loss of 650 jobs and $60 million in economic benefit for each of the three 64-vehicle vessels — the Chetzemoka, Salish and Kennewick — if they had been built out of state.

The legislation has bobbed to the surface following a report earlier this year from Olympia’s Joint Legislative Audit and Review Committee, which studied the issue and has recommended changes to how the state contracts ferry construction.

Although the report recommends a return to nationwide biding, it also advises a switch from accepting contracts — rather than lowest-bidder — based on best value to the state, allowing considerations such as economic benefits, in-state jobs, apprenticeship programs, minority contractors, life-cycle value of the ferries and other potential benefits, down to requirements for how the ferries’ batteries would be recycled.

But how soon a shipyard could build the ferries also could be a consideration.

Andrew Kendrick, a naval architect who assisted the audit committee with its report, said boatbuilders in the state, including Nichols Bros. and Vigor, are capable of providing vessels that fulfill those additional considerations.

“But are they capable of doing this in an accelerated time frame? That’s a factor you can take into account when looking at best value,” he said during the hearing.

DeVere and others maintain that state boatbuilders can. While builders weren’t opposed to the legislation, DeVere suggested that other benefits should be included in the legislation as adding to a state bid’s “best value,” including requiring prevailing wages, environmental considerations, worker and health safety requirements, warranty maintenance and repair costs and the added risk and cost of transporting a vessel from another state.

“We want to build and maintain these ferries,” DeVere said. “We have proven we can build world-class vessels with world-class tradespeople in a timely manner. We ask you amend the bill to allow us to compete for this work.”

While the intention of “Build in Washington” was laudable, it may have discouraged competition that can help keep bids reasonable. But the Senate bill’s recommendation to consider “best value” — along with the economic and other sweeteners that a state builder can offer — should be key considerations for projects funded by taxpayers.

The lowest bid can keep the cost cheap at the start, but sometimes at a greater expense to taxpayers down the road. The legislation further allows the state — if it chooses a state builder, even at a greater initial cost — to better outline the economic benefits provided and make the case to taxpayers that their money is being put to its highest use.