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FTA asks for grant funding back on ferry


MAT-SU—With regret, the Federal Transit Administration sent a letter to the Matanuska-Susitna Borough on Aug. 5 requesting repayment of $12.3 million in federal funding for the Susitna Ferry project. The Borough has 30 days to repay the grants.

The ferry was intended to link the Mat-Su Borough with Anchorage by ferry traffic on a two-mile stretch of water between opposite shores of Knik Arm. It was also part of emergency response plans: a rescue vessel for a potential downed passenger aircraft in cold Upper Cook Inlet near Ted Stevens International Airport; and an alternate water route during an overdue devastating Alaska earthquake, which would likely break the single ribbon of highway connecting the Muni and the Borough.


“After ten years of working to bring the project to fruition, MSB has been unable to implement ferry service in accordance with the requirements of the grant agreements. Over the past year, FTA has collaborated with the MSB on acceptable methods for disposing of the ferry vessel and recouping the federal investment. Unfortunately, MSB’s many efforts to dispose of the asset, or to find a public use for the ferry, have been unsusccesful. … I regret that MSB has been unable to find a public agency with a need for the vessel, nor able to put the funded asset into use for public transit,” wrote Therese McMillan, Acting Administrator with the Federal Transit Administration.



Matanuska-Susitna Borough Manager John Moosey said he was not surprised to receive the FTA letter, having met with FTA officials on many occasions. “I expected this to be done much easier but this is a challenge. We’ve been dilligently looking for solutions to this issue for the last 2.5 years. If we had ferry landings, I’m confident we would not be here today,” Moosey said.

“I’ll be meeting with the Assembly on this issue next Tues.”



A special meeting is Tues. Aug. 12 at 6 pm, in Assembly chambers.



Manager Moosey will meet with reporters to answer questions at 12:30 pm today, Aug. 7, in the Assembly Chambers at 350 E. Dahlia Ave. in Palmer.


See video of the Susitna during sea trials near Ketchikan.



“Every week I get inquiries, just like this one today,” said Mat-Su Borough Port Director Marc VanDongen. “But there’s no guarantee they’ll buy it.”

• The Philippine Navy in connection with the U.S. Navy is expected to inspect the vessel on Aug. 27-28.

• An oilfield service company from Washington State may also be looking over the vessel in that same time period.

• In mid July, CWind Ltd., an offshore wind turbine service company from the United Kingdom spent three days inspecting the ship and putting the vessel through sea trials and a beach landing.

In 2013, the Borough began seeking a buyer for the ship to reimburse the FTA grant.

Another option was to seek forgiveness of that grant if an eligible government in the U.S. put the vessel into ferry transit service. 



The recent handful of the interested adds to a lengthy list of potential users or buyers since 2013. Among them: LA County firefighters, the Commonwealth of the Northern Marianas Islands, Whatcom County, Washington, a Dutch marine company, and a Hawaiian corporation. The Borough approached different entities to offer free transfer of the vessel including: the Alaska Marine Highway System, the U.S. Coast Guard, the Naval Undersea Warfare Center, the National Oceanic and Atmospheric Administration (NOAA). The Borough also solicited the help of 17 shipbrokers worldwide among many other efforts.



• The Susitna Ferry is the world’s first ship that is two ships in one, a twin-hulled ferry that handles rough swells but that can also lower its deck to operate in barge mode to land on beaches. The ship is also built to lift ice and snap it over its bow, another first for a twin-hulled vessel.

• Holds 129 passengers, 20 vehicles, freight capacity 35 tons

• 195 feet long

• The Susitna Ferry was built in Ketchikan as a half-scale prototype of a landing craft for the U.S. Navy, which paid most of its cost of some $78 million

• The construction of the most complex commercial ship in 100 years at Alaska Ship & Drydock in Ketchikan helped the once small shipyard begin a renaissance of shipbuilding in Ketchikan and created 100s of jobs.

• The Susitna is berthed outside Ketchikan at Wards Cove.



The $3.6 million ferry terminal at Port MacKenzie is included in the FTA requested $12.3 million.



click here to read the FTA Letter dated Aug. 5

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