Alaska considers sinking laid-up ferry to save money for Marine Highway

Alaska is thinking of sinking laid-up ferry Malaspina, which has been unused since 2019, in order to save on the costs of its fleet’s upkeep, reported Anchorage Daily News.

The Alaska Marine Highway System is in poor financial shape. In a series of hearings last week members of the Alaska Legislature have been considering what can be done with the deteriorating ferry system, which has seen its budget slashed from $175m in 2014 to just over $103m in the latest budget draft proposed by the administration of Governor Mike Dunleavy.

Officials with the Alaska Department of Transportation and Public Facilities were considering whether to scuttle the ferry Malaspina, one of the oldest of the state’s eight ferries, turning it into an artificial reef. The Malaspina has been laid up in Ketchikan since 2019 because of a lack of maintenance funding. However, it still costs the state about $450,000 in upkeep per year.

However, even sinking it does not come cheap. Turning the Malaspina into an artificial reef would necessitate cleaning it, something that could cost between $500,000 and $1m.

However, that might make long-term financial sense, said deputy DOT commissioner Rob Carpenter. Because the scrap markets are glutted with disused cruise ships, and because the state hasn’t found anyone willing to take it off Alaska’s hands, scuttling might be the best financial option.

Alaska recently sold ferries Chenega (IMO 9265794) and Fairweather (IMO 9265809) for considerably less than it had anticipated. Carpenter said that “the market for them was minimal. We were happy to get what we received. It’s challenging to get rid of a ship these days, especially one as old as the Malaspina”.

Budget cuts have forced the ferry system to tie up ships because the state lacks the money to maintain them. There isn’t any new money to build new ships, which would be cheaper to run. With fewer ships operating, problems caused by mechanical breakdowns have been exacerbated.

Last year some passengers were stranded in Juneau for weeks when a ferry broke down. At the time, it was the only operating ship in the fleet. Another breakdown this month forced the city of Skagway to hire a private boat to carry residents of Haines and Skagway home from Juneau. Their cars are still stuck in Juneau.

The system’s long-term problems include declining passenger counts, a need to serve small, widely spaced communities separated by rough seas, and ships that date back to the 1960s.

A commission formed in February 2020 to examine the ferry system concluded that privatizing the ferry system wouldn’t work and that further cuts would leave the system “non-functional”.

Retired Coast Guard Admiral Tom Barrett, who chaired the commission told members of the Senate Finance Committee that “you’re going to have to keep putting money into this system if you want it to operate,” he said. The railroad benefits from landholdings that allow it to earn money even if railroad operations don’t break even. The ferry system doesn’t have that. You’re going to have to subsidize this for some time to come,” he said.

2005-built, USA-flagged, 3,420 Chenega is still booked as owned and managed by Alaska State and entered with North of England Club.

2003-built, USA-flagged, 3,424 gt Fairweather is also still booked as owned and managed by Alaska State and entered with North of England Club.

However, the local paper Juneau Empire reported in March 2021 that the ferries had been sold o Servicios y Concesiones Maritimas Ibicencas S.A. of Ibiza, Spain, according to Alaska Department of Transportation and Public Facilities. The Chenega sold for $3.11m and the Fairweather for $2.06m.

The Spanish company was apparently the only bidder. It has enlisted a heavy-lift ship to collect the vessels and transfer them via the Panama Canal to their new homeport in Spain.