The U.S. Transportation Department announced this week that it is awarding $285 million to upgrade and modernize Alaska’s ferry system. The money comes mostly from programs Sen. Lisa Murkowski added to last year’s bipartisan infrastructure bill, but the award to Alaska is larger than even she expected.
“I’m so happy. I’m just so happy,” she said on a Zoom call with reporters on Thursday, adding, “let’s not mess this up, right?”
The concern about messing this up hovers over the announcement because the federal money will require the state to put up matching funds totaling more than $100 million, and then support the new ferries and facilities with operating and maintenance funds.
The state Transportation Department applied for the federal grants and asserted that it is committed to providing the match. But Gov. Mike Dunleavy did not show the ferry system much love in his first term. He cut the Alaska Marine Highway System’s budget, sold the state’s two fast ferries for a fraction of their cost and vetoed $17 million to retrofit the Alaska Class ferries. He also idled and then sold the M/V Malaspina rather than pay millions of dollars for repairs.
Murkowski said she spoke to the governor and to state legislator Bert Stedman, co-chair of the Senate Finance Committee, about the need to spend state dollars to get the federal grants.
“It’s going to take some money, but it’s worth the investment,” she said.
Alaska was awarded about 75% of the federal money available for ferries this year. The infrastructure law covers four more years of ferry grants. Transportation Secretary Pete Buttigieg said that reflects the need in coastal areas of Alaska that aren’t connected by roads.
“For so many communities, including the 35 communities along the Alaska Marine Highway, where everything is spaced further apart, where transportation is very expensive, waterways are critical, and they’re part of everyday life,” he told reporters in an online press conference.
The money was awarded in six grants. They would, among other things:
• Replace the Tustumena, a 58-year-old ferry serving Kodiak and Southwest Alaska communities, with a hybrid diesel-electric vessel;
• Upgrade docks in Juneau and Cordova;
• Replace docks in Pelican, Tatitlek and Chenega;
• Design new mainline ferries that could run on diesel or electricity;
• Modernize the Columbia, Kennicott, Matanuska and Tazlina ferries;
• Provide $45 million to bolster operating funds.
The governor’s deputy press secretary, Shannon Mason, responded to emailed questions about ferry funding.
“The Office of the Governor intends to work with the Legislature and evaluate all our options to match this funding,” she wrote. “We have existing resources already appropriated that could potentially be used to match some of this funding.”