Borough money floats MV Susitna overhaul

After years tied to a dock, the Matanuska Susitna Borough’s ailing ferry, Susitna, could be sold to the Philippine Red Cross  by this summer.

Repairs on the damaged ferry Susitna will go ahead, according to a Matanuska Susitna Borough spokeperson. Patty Sullivan said in an email on Wednesday that the Mat Su Borough Assembly voted Tuesday night  to spend $2 two million on repairs to four engines on the ship. The vote on the appropriation had been delayed since mid February because the Assembly  had not seen a written agreement from the purchasers of the ship to extend a March 31 deadline for completion of the work.

Mat Su Assemblyman Steve Colligan voted against appropriating the money for ship repairs. Colligan had held out for the letter  from the board of the Philippine Red Cross, which would put in writing an agreement to the extended deadline.

“I don’t think there is any more thing better than a signed agreement and terms and a deadline in terms before moving ahead. With all the stuff we have been through, I’m hoping this is the last move of the ferry.”

The long awaited letter arrived Tuesday evening, just before the ferry issue was brought up at a joint Mat Su Assembly/ School Board meeting. The new agreement extends the deadline for repairs until June 30.

Mat Su Assemblyman Dan Mayfield, pushed for the ship’s repairs, although there is no guarantee  proceeds from the sale of the ferry coupled with potential payments from insurance claims, will reimburse the Borough for the money spent on the ship.

“The vessel has been sitting in Ketchikan for quite some time, without a lot of action to proactively repair it. And so we need to show good faith, both to our insurance company and to the Philippine Red Cross, that we are going to proceed with the repairs.”

The $2 million approved on Tuesday is in addition to the $1.1 million dollars already allocated to ferry repairs in December of last year.
The Borough expects to gain $1.7  million dollars from the sale of the ferry. Not exactly a break even deal, Mayfield says.

He estimated that the Borough’s ferry insurer, Lloyds of London, could pay the Borough up to $2.7  million dollars to cover claims, although that amount is not guaranteed at this point.  Borough auditors have put the insurance estimate a a little over $1 million dollars, with the caveat that any money gained from insurance will be earmarked for payment of a federal loan related to the ferry.

Assemblyman Colligan says the amount insurance adjusters may pay is far from definite.

“That’s all up for negotiation and argument at the moment, and that is an unknown. Until the repairs and stuff are done, they haven’t committed. And that is part of the problem.”

The appropriation was approved by a 4 – 2 vote, with Colligan and Assemblyman George McKee voting in opposition.
According to information presented at Tuesday’s meeting, the repair and sea trials for the Susitna are expected to be completed by May 31. The Philipine Red Cross has 45 days after that to take possession of the ship.

APTI Reporter-Producer Ellen Lockyer started her radio career in the late 1980s, after a stint at bush Alaska weekly newspapers, the Copper Valley Views and the Cordova Times. When the Exxon Valdez ran aground in Prince William Sound, Valdez Public Radio station KCHU needed a reporter, and Ellen picked up the microphone.
Since then, she has literally traveled the length of the state, from Attu to Eagle and from Barrow to Juneau, covering Alaska stories on the ground for the AK show, Alaska News Nightly, the Alaska Morning News and for Anchorage public radio station, KSKA
elockyer (at) alaskapublic (dot) org  |  907.550.8446 | About Ellen

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