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Mat-Su fields new offers to buy its unused ferry

Zaz Hollander
Mat-Su Borough

WASILLA -- The Mat-Su Borough's port director is quietly negotiating two new offers to buy the idled ferry M/V Susitna even as other officials plan to try to convince the federal government to let them off the hook for $12 million in ferry-linked grant obligations.

Originally intended to carry up to 130 passengers and 20 cars between Anchorage and the borough's Port MacKenzie, the borough's 195-foot ferry -- the world's first catamaran with ice-breaking capability -- has instead spent the last two years parked at a Ward Cove dock.

The borough got the unique $78 million U.S. Navy prototype that converts to a barge for free thanks to the largesse of the late U.S. Sen. Ted Stevens but funding hurdles and other roadblocks stymied plans to run the Cook Inlet ferry route.

The ferry's been for sale since 2012. It's specialized and considered relatively underpowered, making it a tough sell outside the Inlet.

Both offers currently on the table are "in the vicinity" of $6 million, according to port director Marc Van Dongen. Neither are formal yet, with no contracts signed, and both have requested confidentiality.

Van Dongen said the priority is from a California-based group of businessmen who plan to run the ferry in Alaskan waters. The borough would require a $500,000 deposit and the potential buyer would have 90 days to inspect the ferry, he said. They could withdraw their offer at any time.

The other potential buyer is an East Coast ship broker working with a client from South America, he said.

That's all Van Dongen would say.

He's been disappointed before: a $6 million offer last year fell through and the borough passed on several lower offers.

"I'm cautiously optimistic we'll be able to sell it but we've been trying for almost two years now," the port director said Friday afternoon. The offers surfaced publicly during a Mat-su port commission meeting Monday.

Struggling to rein in $70,000 monthly storage bills in Ward Cove, the Assembly leaned toward bringing the Susitna up to Port MacKenzie to attract buyers but decided last fall to put it into "wet layup" status -- starting the motors once a month but no trips off the dock -- to save money on fuel, staffing, insurance and utilities.

If the borough or another public entity can't put the ferry into service, then the Mat-Su is on the hook to the Federal Transit Administration for $12 million: $6 million to turn the Navy vessel into a ferry; another $4 million for a Mat-Su ferry terminal currently serving as port offices; and $2 million for design work on ferry landings in Mat-Su and Anchorage.

That's something the borough hopes to change.

The Mat-Su Assembly on Tuesday night emerged from a closed-door session on the ferry to direct Borough Manager John Moosey to "engage in serious discussions with the FTA on the disposition of this boat," Moosey said Friday.

The manager, along with the borough attorney, plan to ask the agency for "total absolution" of the borough's obligation, Moosey said.

With federal earmarks drying up and a different spending climate in Congress -- not to mention the loss of Stevens -- there's no federal funding for the ferry landings, Moosey said.

The pair will argue that it's financially irresponsible for a borough with a $48 million budget to move forward with ferry service, he said. "We're going to be asking for something that's pretty unique."

Asked if the borough is also considering legal action against the federal government, Moosey said he couldn't comment.

Reach Zaz Hollander at zhollander@adn.com or 257-4317.


By ZAZ HOLLANDER
zhollander@adn.com