Sen. Bert Stedman, R-Sitka, Co-Chair of the Senate Finance Committee, raises his concerns of the proposed lack of funding for the Alaska Marine Highway System at the Capitol on Wednesday, Feb. 19, 2019. Major cuts to fuel for the ferries could effectively shut the transportation system down. (Michael Penn | Juneau Empire)

Sen. Bert Stedman, R-Sitka, Co-Chair of the Senate Finance Committee, raises his concerns of the proposed lack of funding for the Alaska Marine Highway System at the Capitol on Wednesday, Feb. 19, 2019. Major cuts to fuel for the ferries could effectively shut the transportation system down. (Michael Penn | Juneau Empire)

Senators want more answers on Marine Highway closure

Marine Highway closure could have dire results

Sen. Bert Stedman of Sitka led the Senate Finance Committee into an in-depth discussion on the fate of the Alaska Marine Highway System and the implications for Alaska’s coastal communities, Wednesday morning.

As the Finance Committee made its way through another round of departmental presentations with Office of Management and Budget staff, Stedman took issue with one of the slides being projected before the committee.

The slide showed the total number of Alaska Department of Transportation employees dropping from 3,388 in 2019, to 3,385 employees in 2020. That figure includes full-time, part-time and non permanent employees.

“I’m confused, so help me,” Stedman, a Republican, said. “How come the position count is staying the same when the we have budgetary implications of terminating the existence of the Marine Highway on October 1 and terminating the employees.”

Stedman said there are roughly 318 shoreside and ship employees working in the Alaska Marine Highway System who could be out of a job by Oct. 1.

As part of Gov. Mike Dunleavy’s plan to reduce government, he has proposed a $97 million cut to the Alaska Marine Highway System. There would be funding to keep the ferry system running through the summer with reduced service in September. The last ferry would be set to sail on Sept. 30.

[Ferry system aims to save money with vessel swap]

Dunleavy also issued a directive for OMB Management Director Amanda Holland to find “a qualified marine consultant” to identify potential reductions to the Marine Highways System.

“The project should include an investigation of options available for the reshaping of the Alaska Marine Highway System, such as through a public/private partnership and an analysis of the various options’ feasibility,” the directive says.

In the finance meeting, Stedman asked, “How do you rectify your position count with the termination of the employees? It may be accurate for June but it seems totally distorted for December.”

Holland responded saying there is usually a reduction in staff during the winter months for AMHS employees and her office could provide details on how those employees might be affected.

Stedman continued asking questions and talking about the Marine Highway for another 10 minutes or so before he deferred to Sen. Bill Wielechowski, D-Anchorage.

“Senator (Bill) Wielechowski, you want to ask a question so the blood pressure of the chairman goes down?” asked Stedman, who is co-chair of the committee.

Toward the end of the meeting, Sen. Mike Shower, R-Wasilla, discussed military exercises and reports that showed Alaska could not survive on air transport alone in case of an emergency. He is an Air Force veteran.

“One of the things that seem to be crystal clear to me from my experience doing this, is you cannot keep a community alive without that heavy transport, the ferry system coming through,” Shower said. “If we shut them down in the winter time, we are literally, in a way, stranding them.”

Shower doubted that all of these coastal communities have the air support and associated infrastructure to sustain the operations needed to supply people through the winter.

“Trust me on this one, if you shut down the ferry operations, you are potentially, I hate to say it, but you’re potentially strangling those communities because they may not make it through winter, if the airports can’t support them,” Shower said. “And my guess is they can’t.”

Shower suggested the DOT’s rural airport study find out what communities have the infrastructure to sustain communities through the winter.

Sen. Peter Micciche, R-Soldotna, said he feels “hogtied” because he wants to support dramatic reductions to the state budget, but he needs a lot more information before he can support them.

“I feel like, in the effort to eliminate the cost of parachutes, we didn’t evaluate other methods of getting to the ground before we left the plane without one,” Micciche said.

[A strong ferry system is part of a stronger Alaska]

“Unleashing Entrepreneurialism”

During a Tuesday morning budget presentation from the OMB, Sen. Natasha von Imhof, R-Anchorage, commented on the Dunleavy administration’s desire to potentially privatize the AMHS. A presentation slide projected during he Finance meeting regarding the governor’s budget directives read:

“Unleashing Entrepreneurialism

Alaska Marine Highway System.”

“I just have to chuckle over the header,” von Imhof, finance co-chair, said.

“Shutting down the state funding in so many areas and hoping the private sector will pick up the slack, really, there’s a reason why the state is playing in this space and not necessarily a private sector, because it’s not altogether profitable,” von Imhof said. “And the state is doing more of a service to the community. And actually shutting off the funds and hoping the private sector will pick up the slack is a little, well, it’s interesting.”


• Contact reporter Kevin Baird at 523-2258 or kbaird@juneauempire.com. Follow him on Twitter at @alaska_kev.


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