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12/29/2012
DOT details ferry decision rationale

By SCOTT BOWLEN

Daily News Staff Writer

The Parnell administration has provided more details regarding its decision to shelve the Alaska Class Ferry project in favor of building smaller boats focused on Lynn Canal.

The Alaska Department of Transportation released a four-page "white paper" on the subject on Dec. 20, the same week that DOT officials talked about the decision with Juneau Chamber of Commerce and Southeast Conference groups.

DOT Commissioner Pat Kemp told a Juneau Chamber audience the ferry story began in 2006 when the department started work toward what then was described as a Southeast Shuttle Ferry.

"We have to go back a little bit and talk about the genesis of the project and how it developed and how it changed and how we hit the reset button and changed it back," Kemp said.

The original concept was based on the 2004 Southeast Alaska Transportation Plan, which envisioned building more roads and reducing the length of various ferry routes.

"The whole mantra of the Southeast plan is to extend roads and reduce ferry links," Kemp said. "That way we get multiple trips, better traveling."

A benefit of shorter routes is the opportunity to use "day boats" between specific destinations, such as the Alaska Marine Highway System ferry Lituya does now between Metlakatla and Ketchikan.

Day boats generally are less expensive to operate because they require less crew and fewer on-board amenities such galleys and staterooms for passengers or crew.

A priority of the Southeast Alaska Transportation Plan is the Juneau Access Highway.

DOT now is completing a Supplemential Environmental Impact Statement for the proposed 51-mile road that would extend north from Juneau along the east side of Lynn Canal to a new terminal at Katzehin, which is about 15 miles from Skagway.

Shuttle ferries would link the Katzehin terminal to Skagway and Haines. The Haines-Katzehin link is about 7 miles, according to the original 2006 federal record of decision for the Juneau Access project.

Thus, DOT began work toward a new type of shuttle ferry that could serve the Juneau Access project, in addition to replacing the aging AMHS Malaspina, which at the time was considered to be nearing the end of its service life.

ROLL-ON, ROLL-OFF

"So, born from the Southeast plan, and also the Juneau Access Project, in 2006 we started going out looking for a new vessel to replace the Malaspina," Kemp said. "It wasn't going to be a mainline vessel. It was going to be a series of shuttle ferries."

According to the AMHS System Analysis commissioned by DOT in 2007 and completed by the Alaska University Transportation Center in early 2012, the full shuttle-ferry option calls for the replacement of the ferries Malaspina and Taku with three identical day boats. Two of the new boats would operate in Lynn Canal during the summer, while one boat would run between Ketchikan and Prince Rupert, British Columbia.

DOT hired Elliott Bay Design Group to work with the department on the design process for a 450-passenger ferry that would be capable of loading and offloading 48-60 vehicles through doors in the ferry’s bow, stern and side.

This "roll-on, roll-off (ro-ro)" design was estimated in 2006 to have a construction cost of between $25 million and $30 million, according to DOT’s white paper.

Kemp said the roll-on, roll-off concept — specifically the inclusion of a bow door — is crucial for reducing the amount of time needed to on- and off-load vehicles in port. Vehicles load in one end of the ship and exit straight through the other, saving time for large RVs and tractor-trailers that otherwise have to turn inside the vessel to enter and exit the ferry’s vehicle deck from a side door.

"It can take 5-10 minutes to get one vehicle on the boat," Kemp said. "So the idea is you put them on and you take them off and you turn that boat around in a half hour. ... So this started the process to get Alaska's first roll-on, roll-off, ferry through the stern and bow, since we had the Bartlett."

DESIGN CONCEPTS EVOLVED

The design process included the Alaska Marine Transportation Advisory Board and a series of DOT public meetings to gather input about the proposed design.

Kemp said the design started to change as a result of the public involvement.

"The thing started getting tweaked," said Kemp, later likening the situation to public involvement in a highway design process.

"We go out to a public meeting on a highway, and all of a sudden people want sidewalks on both sides of the road," Kemp said. "They want four lanes. They want separated bike paths. They want lighting. They want all these different things."

The addition of such items increases the costs, and, in the case of a highway, can mean that only a portion of the project can be completed within a given budget unless more funding is available from federal or state sources, according to Kemp.

He acknowledged that DOT led the process and incorporated some of the requested design changes.

A 2009 report on what became the Alaska Class Ferry project noted that DOT and AMHS worked to "broaden the mission of the vessel to operate in all routes within inside waters."

DOT resisted ongoing requests for passenger staterooms, but included quiet rooms for elderly or infirm passengers. Crew quarters were added to allow the vessel to overnight in ports when needed (day boats are limited to a 12-hour operating day).

The vessel was lengthened, and the bow door concept was dropped.

The 2009 report by Elliott Bay discussed the bow door issue, noting that increases in port-time efficiency could allow the ships to save money by sailing slower. However, initial construction and continuing maintenence costs would be higher, according to the report.

"When the bow door came off, we lost the (roll-on, roll off)," Kemp said. "We lost the efficiency we were looking for. That was the number one issue."

Cathie Roemmich, a member of the Alaska Marine Transportation Board since 2007 and currently executive director of the Juneau Chamber of Commerce, told the Juneau Chamber audience that she watched the project "morph into this huge boat."

"There was so much public comment, and every time DOT would give us a presentation and show us the plans for this new ferry, it kept getting bigger and it had more amenities," Roemmich said. "Originally there wasn't going to be any staterooms, then there were crew quarters, and then there were sick rooms, and then there were rooms for the elderly. Of course we want all of that stuff, but what we're trying to do is save money for our marine highway."

By 2009, the concept for the Alaska Class Ferry project was complete.

The design, which called for a 350-foot ferry capable of carrying up to 499 passengers and 60 "Alaska-size" vehicles (such as a Ford Expedition), carried an estimated cost of $120 million.

"This all happened under the watch of the department," Kemp said, citing the cost increase as the most important issue. "I'm not exactly sure of all of the factors that went into it, but it was just one of those things that people were brought along."

STATE STILL ON BOARD

The state was on board at that point.

Alaska’s Legislature in 2010 appropriated $60 million as a match for $68 million in federal funds to construct the first ferry, according to DOT information.

Concerned that federal funding requirements would reduce the opportunity to build the Alaska Class ship in Alaska, presumably at the state-owned Ketchikan Shipyard, the Parnell administration redirected the federal funds to other transportation projects in Alaska.

"It was the governor’s and Legislature’s intent to build that vessel in Ketchikan at the Ketchikan Shipyard," Kemp said. "We would get jobs out of the deal, and it was just a good thing all around, rather than building it on the Gulf Coast."

The Alaska Legislature in 2011 appropriated another $60 million for the first Alaska Class ship, and in 2012 appropriated an additional $50 million toward a second Alaska Class ferry.

According to Parnell and administration officials, DOT began having second thoughts about the Alaska Class Ferry project in late 2011.

"We were getting concerned about, just about everything," Kemp said. "It was kind of congealing. We had a new administration in. and we were concerned that (the project) was converging away from its original intent."

That’s also when the department first started hearing "rumors" that the cost of building the first ship would be more than $120 million, according to Kemp.

NO EFFICIENCIES

In addition, Kemp and the DOT white paper cite the Alaska University Transportation Institute’s AMHS System Analysis findings that AMHS wouldn’t gain any efficiencies with the Alaska Class Ferries.

One finding was that replacing the Malaspina with an Alaska Class ship would not improve efficiency because other AMHS ships would have to fill in for the Malaspina’s mainline duties, such as route between Ketchikan and Bellingham, Wash.

The other finding is that operating three Alaska Class ships and eliminating the Malaspina and Taku would boost the annual AMHS operating subsidy by $6.7 million.

While Kemp and the white paper cite the $6.7 million figure, neither described the AMHS System Analysis’ foundation for the increase.

The analysis indicated that building new ships is generally more expensive than refurbishing old vessels.

And, while building the Alaska Class ships would boost service in Lynn Canal, "the revenues generated by the expanded Lynn Canal service fall well short of the level expected to accrue from the proposed capital expense."

In addition, the analysis indicates that the overall AMHS fleet would expand from 11 ships to 13 ships under this option.

The institute’s analysis looked at six options and found that only one would result in substantial subsidy reductions for the marine highway system.

Comparing the various options "confirmed that a significant reduction in service and a reduction in the number of vessels are necessary to achieve a material subsidy reduction" for AMHS, according to the document.

Although DOT was beginning to have second thoughts about the Alaska Class Ferry project, the department in April signed a contract with Ketchikan Shipyard operator Alaska Ship and Drydock. The company became the construction manager-general contractor for the final design process, and began working toward the opportunity to negotiate with DOT next summer for a guaranteed-maximum price contract to build the first Alaska Class Ferry.

‘PREDICAMENT’

By fall of 2012, the design process for the Alaska Class Ferry project was producing cost estimates in the range of $150 million to $167 million.

"We were in a predicament," Kemp said. "At that time, we were faced with a vessel that didn’t meet the original intent of a shuttle ferry — roll-on, roll-off efficiency. We had a university study that was dubious about the efficiency of the boat. And the cost of the new boat (was) far over the estimate. We took that information to the governor."

Parnell asked DOT to come back with some recommendations. When the department did so, Parnell said, "We’ve got to hit the reset button on this," said Kemp.

Parnell announced the decision to shelve the Alaska Class Ferry project on Dec. 4 in Ketchikan.

NEW DIRECTION

Kemp said Dec. 20 that the new direction goes back to the roll-on, roll-off concept focused on the Lynn Canal route.

"What we're doing now, we're basing this vessel on the needs of the Juneau Access Project," Kemp said.

The new boat will be between 260 feet to 300 feet in length, with a capacity for about 50 standard (not Alaska size) vehicles. It will not have staterooms for passengers or crew.

The proposed ferries will have bow and stern loading capabilities.

For size comparison, the proposed vessels will be larger than the 235-foot AMHS ferry Aurora and the 198-foot Inter-Island Ferry Authority ferry Prince of Wales.

DOT hasn’t decided on a specific design — Kemp mentioned that a Lituya-style hull and Washington state double-ender ferry concepts had been submitted under the original 2006 request for proposals.

However, "this vessel is expected to have the same seakeeping abilities as the Taku," Kemp said, adding that the new boat will be narrower because vehicles won’t have to turn and maneuver to get out of a ferry’s side door.

The Juneau Access Project calls for a shuttle ferry that operates between the new Katzehin terminal and Haines and Skagway.

"When the avalanche hazard (on the road) is high enough, the intent is to run that vessel down Lynn Canal when traffic demand is very low in the winter and close the roadway until the avalanche mitigation can be done. Then open the roadway back up," Kemp said.

The ferries could operate round trips between Juneau and Haines during a 12-hour operational day. One potential advantage would be to base one ferry in Haines and one in Juneau, allowing two departure times daily from each port, according to Kemp.

The new boats also could be used between Juneau and Icy Strait, or on other routes that can be completed within a 12-hour day.

Sen. Bert Stedman, R-Sitka, who as co-chair of the Senate Finance Committee was instrumental in securing appropriations for building the Alaska Class ferries, asked Kemp how viable the new boats would be for the Ketchikan-Prince Rupert run.

Kemp replied that the new boats "wouldn't work there because of the (international Safety of Life at Sea) requirements. We'd have to use one of the existing vessels for that."

He emphasized that the new ferries wouldn’t eliminate the mainliner run in Lynn Canal for the time being.

"This supplements the mainliner," Kemp said. "Big Blue is still going to be running up the canal until we can get that road in place."

Built in Ketchikan?

The Parnell adminstration asserts that two of its proposed ferries can be built for $120 million.

Kemp said the state fully intends to have the Ketchikan Shipyard do the work, but cautioned that the shipyard doesn’t have a "full lock" on the project.

"The governor was very clear with Ketchikan, and we're kind of in a Catch 22," Kemp said. "We want the jobs to be in Alaska, but we also want to get a fair price. Under the CMGC concept, we'll negotiate a price. And if we don’t like the price ..., we think we can go elsewhere, we'll put it out for a competitive bid."

He voiced confidence that the shipyard would "come through."

"They know that it's going to be competitive," Kemp said. "They don't have a lock on it. Close to a lock, but not a full lock. We'll sit down and, at the end, we'll negotiate this thing out."

Kemp said he recently spoke with an Alaska Ship and Drydock official who said the most cost-efficient way to build the ferries would be to construct them side by side.

That way, for instance, the steel-cutting crew could cut the steel for one ship, then immediately cut the steel for the second boat.

"So there will be about a three-month lag behind to build these two vessels," Kemp said. "One will hit the water. Three months later, the other will hit the water."

What about older boats?

During the question and answer period with the Juneau Chamber audience on Dec. 20, Kemp was asked what the new plan meant for replacing older ferries.

Kemp replied that they hope to replace one mainliner or more with the new shuttle ferries, but DOT didn’t know how many now.

"We’re always going to need mainliners," Kemp said. "They’re always going to go from Bellingham out to the (Aleutian) Chain."

He said AMHS has a growing confidence in the Ketchikan Shipyard’s ability to keep the existing mainliners running.

"I think there's been a paradigm shift with our thoughts on the mainliners," Kemp said. "They can't last forever. But I think they can last a little bit longer."

DOT’s next immediate concern will be to replace the ferry Tustumena, which has operated on the difficult Gulf of Alaska routes for about 45 years, according to Kemp.

Ferries different

Kemp was asked whether the Parnell administration would apply the same project-cost rationale to cutting back other transportation projects in Alaska, such as the proposed Knik Arm bridge.

Kemp replied that the Knik Arm Bridge was different because of its bond financing structure, and described how federal money can be transfered between highway projects as needed.

The Alaska Class Ferry project was different, according to Kemp.

"With this project, we had $120 million, and the governor, quite frankly, didn’t want to go back for more," Kemp said. "We were on a mission at the beginning and lost our focus, And we hit the reset button."

He said the governor should be applauded for taking that action, which Kemp said was the right thing to do.

Kemp acknowledged that some people have questioned the wisdom of Parnell’s decision, and the administration is getting "hit with a lot of theories" that the sky is falling.

"I don't think that's the case at all," Kemp said. "I think we have got a good vessel in hand."

While there were a number of questions for Kemp during the Chamber meeting recorded by the Alaska Internet Network, no one voiced opposition to the new direction.

MTAB Member Roemmich voiced her support.

"The whole state pays so much for this public transportation method we have," Roemmich said. "And when the governor announced that, I was so pleased, because finally somebody said, ‘Wait a minute.’ And they're taking it back to what the original plan was. This is to save money, and to improve our infrastructure in Southeast Alaska. And that's what (Parnell) did, he pulled it back. I think they couldn’t have done anything better."