‘Elimination budget’ could end state ferry sailings by October
State lawmakers had sharp words for budget officials this week, criticizing what one senator called an “elimination budget” for state ferries on track to end their 2019 sailings as soon as October.
Aurah Landau, a spokeswoman for the Alaska Marine Highway System, said in an email Thursday that that the ferry system would have nearly 85 weeks of operating service under Gov. Mike Dunleavy’s austerity budget. Transportation Commissioner John MacKinnon is seeking a “qualified marine consultant” to recommend cuts to the ferry system, according to a Feb. 12 memo.
“The published 2019 summer sailing schedule remains intact through the end of August,” AMHS officials wrote. “Service on the Bellingham, Northern Lynn Canal, and Ketchikan-Annette Bay routes will continue through the end of September. No vessels will be in operation from October 2019 through June 2020.”
Details emerged on the ferry system’s budget woes during a Wednesday meeting of the state Senate Finance Committee in Juneau, chaired by Sen. Bert Stedman, R-Sitka.
The proposal calls for roughly $60 million to be cut from the Department of Transportation and Public Facilities’ budget — $593 million down to $533 million.
Members heard from Amanda Holland, the state Office of Management and Budget’s management director for DOTPF, who answered questions on the ferry system as she sat alongside a silent Donna Arduin, OMB’s overall director.
Informed of the ferry system’s reduced sailing schedule, Stedman immediately began to grill Holland.
“Should the committee then expect an amendment coming forward to keep the sailing of the marine highway from October through the end of June?” Stedman asked.
“I do not have an exact answer for you at this time," Holland said. "I would not rule out a possibility.”
Holland made a fiscal case for ferry system cuts, telling senators that about 450,000 passengers rode the system annually at its peak in the early 1990s — but that total had nearly halved to 250,000 passengers last year. Although vehicles transported aboard ferries have remained constant at about 100,000 per year, she said the percentage of the ferry system’s state costs recovered in fares has fallen from 60 percent in 1992 to 33.3 percent last year.
Holland said the marine consultant, who hasn’t yet been hired, will be working with the state on ways to address the shortfall.
“That could range from a public-private partnership type of relationship, which could address some of the federal funding issues, to a different type of Marine Highway System, a different look and feel,” she said.
Stedman criticized that claim, noting during the hearing that the ferry system’s fuel budget was being reduced from $20.6 million to a proposed $400,000, with its reservations and marketing budget slashed from $2.05 million to $631,600.
“Now we’re faced with a budgetary proposal for elimination; that is what this budget does,” Stedman said. “It’s an elimination budget, in my opinion, of the marine highway.”
As an alternative, Stedman suggested more limited cuts which would balance the ferry system’s expenses and revenue. That would allow it to continue operating through the winter months as a viable entity, while privatization or other alternatives are explored.
“It’s very difficult to kick everyone out of an apartment house and let it sit vacant, and then turn around and try to sell your apartment house,” Stedman said.
After the mention of fragmentary studies in recent years examining various aspects of the ferry system, Sen. Natasha von Imhof, R-Anchorage, asked Holland about the data used in determining the budget cuts.
“Did you use any portion of these studies to guide your decision to reduce the Alaska Marine Highway, and if you didn’t use these studies what did you use?” she asked.
Holland responded that OMB has been in close contact with AMHS leadership regarding the cuts.
Sen. Bill Wielechowski, D-Anchorage, raised the question of how publicly the ferry system’s website was announcing the October halt in sailings.
“I’m looking on my phone and it shows no runs after Sept. 30,” Wielechowski said, glancing up from an itinerary search on his touchscreen. “I don’t know if that’s how they normally do it.”
Sen. Mike Shower, R-Wasilla, a former F-22 Raptor squadron commander at Joint Base Elmendorf-Richardson, noted ferries’ vital importance in the event of a disaster. He mentioned an exercise shortly before his retirement from the military, which showed that “without the ports we’d die” because supplying Anchorage alone would take an airlift effort three times larger than the Cold War-era Berlin Airlift.
“Trust me on this one, if you shut down the ferry operations, you are potentially — I hate to say it — but you’re potentially strangling those communities, because they may not make it through the winter without that if the airports can’t support them,” Shower said. “And my guess is that they can’t; I don’t think that infrastructure’s there.”
Shower’s account stunned several senators in the room including Sen. Peter Micciche, R-Soldotna, who offered a hesitant note near the end of Wednesday’s comments on the ferry system.
“I feel like we’re on hold,” Micciche said. “I want to support dramatic reductions in this budget, but I feel like in the effort to eliminate the cost of parachutes, we didn’t evaluate other methods of getting to the ground before we left the plane without one.”
The proposed budget comes a month after DOTPF announced it was saving about $27 million by not installing crew quarters on its new Alaska-class ferries. The decision will restrict both ferries’ use to “day boats,” preventing them from serving the state’s longer routes.
Sen. Jesse Kiehl, D-Juneau, wasn’t able to attend Wednesday’s meeting but shared his colleagues’ concerns.
“There are no toll on roads, (but) there are in Southeast; you have to buy a ticket,” Kiehl said by phone Thursday. “So how would folks in any community do if you shut down the road?”
Kiehl also pointed out the ferry system’s integral role in Southeast Alaska health care, noting that the ferries serve as a reliable means of bringing patients to hospitals when weather conditions prevent flying — as they did Monday, when Kiehl was returning from a visit to constituents in Skagway.
“If you can’t get a plane in, you can’t get a patient out — unless there’s a ferry,” he said. “I got out on the ferry.”
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