A 45-page bill to restructure the Alaska Marine Highway System as a state-owned corporation, run by an appointed board of directors, similar to the Alaska Railroad, is going to take longer than one legislative session to review, amend and adopt — if even then.
“This is going to take a big lift,” said Robert Venables, executive director of the Southeast Conference, an economic and community development nonprofit for the region that supports the concept of a ferry corporation.
“This is aspirational,” he said Feb. 23, a day after the Senate Transportation Committee held its second hearing on the bill. No further hearings were scheduled as of this week.
Proponents of the shift from an agency within the state Department of Transportation to a separate corporation have long said it would help shield the ferry system from political upheaval every time a new governor takes office. Supporters also contend it would help with long-term planning to better serve coastal communities, somewhat outside the political process of decision making by the Legislature and governor.
“We’re going to start ironing out the lumps” of the bill, said Juneau Sen. Jesse Kiehl, who serves on the Transportation Committee. “A 45-page bill needs a lot of thinking and a lot of work,” he said the day after the hearing, acknowledging the ironing will extend into next year.
The ferry system has been a state agency since its creation almost 60 years ago, often getting caught up in political and budget debates over design, construction and use of new vessels, routes and the system’s annual state subsidy.
However, even if legislators someday pass a bill creating a separate corporation, the ferry system will still require state financial assistance, Kiehl said, noting that “nothing that needs an annual appropriation will be free of politics.” But a corporation could be freer of politics than a state agency, he said.
“Many previous reports have suggested that a public corporation would be the best structure for the Alaska Marine Highway System, primarily to allow for professional mariners and those with business expertise to oversee operations of the $100 million-plus enterprise,” Venables said last week.
However, Southeast Conference members understand “that establishing a public corporation will take time and it is unlikely to happen very soon,” he said.
The corporation would negotiate union contracts with its workers, decide on building new ferries and maintaining older vessels, set fares and service schedules throughout the system for Southeast, Prince William Sound and Southwest Alaska.
Senate Bill 170, offered by the Senate Transportation Committee this year, would create a seven-member corporate board of directors, all appointed by the governor and subject to legislative confirmation. Members would serve five-year terms, and the law would require that three of the members live in a community with ferry service.
At the Feb. 22 committee hearing on the bill, Kiehl questioned what would happen if the Legislature one year balked at providing enough state money for the system to operate its scheduled level of service.
“We’ll need some sort of subsidy,” said Committee Chair Robert Myers, of North Pole.
Other questions raised by senators included whether the corporation should have authority to sell ships or ferry terminals owned by the state, and whether the corporation should be allowed to sell bonds on its own, without needing legislative approval, to make purchases such as new vessels.
The intent of the bill is to make the corporation’s powers “as broad as possible,” Myers said.
Sen. Peter Micciche, of Soldotna, said he is concerned about giving the corporation authority to borrow money “without a second set of eyes.”
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