State seeks waiver of Buy American law to rebuild Prince Rupert ferry dock

Restarting Alaska state ferry service to Prince Rupert, British Columbia, is contingent on the state receiving a long-sought federal waiver for renovations to the leased terminal at Prince Rupert and waiting at least until 2026 when the Kennicott returns to service.

That’s according to Alaska Marine Highway System staff presentations at the Oct. 23 Alaska Marine Transportation Operations Board meeting.

Shirley Marquardt, chair of the advisory board, said there is a strong push to restore service to Rupert, just 90 miles south of Ketchikan, which would offer a less expensive state ferry connection to the U.S.-Canada highway system than travelers going all the way to Bellingham, Washington..

The Alaska Department of Transportation submitted its second request for a Buy American waiver in September — and is pressing for a reply from federal officials. A waiver would allow the terminal work to proceed without necessarily using U.S. steel or equipment.

“I’ve told them we need an answer, yes or no,” Kirk Miller, preconstruction engineer for the department’s Southcoast region, told the advisory board.

The nine-member board makes recommendations for state ferry operations and the development of short-term and long-range plans for the ferry system.

Prince Rupert figures large in the history of the Alaska ferry system. The port town with a population of about 12,500 residents at the western end of Canada’s Highway 36 was the Alaska Marine Highway’s first southern terminus when service began in 1963.

Even after the southern terminus was moved to Seattle and then to Bellingham, Washington, ferry service to Prince Rupert remained steady between Ketchikan and Prince Rupert for years before declining substantially in the mid-2010s.

That’s when state budget woes and the effects of an aging fleet resulted in a service reduction from two round-trip sailings between Ketchikan and Prince Rupert to one sailing per week. In 2016, the first service interruption of at least one month occurred, beginning a trend that would continue until 2019 when service to Prince Rupert ended entirely (except for a brief return in the summer of 2022).

Meanwhile, the ferry terminal at Prince Rupert is in poor condition.

Alaska doesn’t own the site, which is on Canadian federal land. The state has a 50-year lease, signed in 2013. The lease stipulates that the state is expected to rebuild the terminal and its wooden dock structure.

In 2014, the Alaska Department of Transportation prepared a Prince Rupert project that would have used mostly U.S. federal funding to rebuild the dock. The project was estimated at between $10 million and $20 million, and U.S. and Canadian companies could have bid on the job.

However, the Buy American Act of 1993 requires projects funded by the Federal Highway Administration to use only U.S.-produced steel, iron and manufactured products. Those provisions caught the eye of Canadian authorities — and a protectionist showdown ensued.

Gary Doer, Canada’s ambassador to the U.S. in 2014, wrote a letter to then-Gov. Bill Walker, saying that applying Buy American restrictions to a project on Canadian soil was unacceptable, according to The Associated Press coverage.

The state could have applied for a federal waiver to the Buy American provisions, or the state could have funded the project itself to avoid the federal requirement. But the state did not seek a waiver and canceled the bid process in 2015.

Then, in January 2018, Alaska sent a waiver request to the Federal Highway Administration for an initial review. It did not receive an answer, according to ferry system officials at the Oct. 23 meeting.

For Prince Rupert to move forward as a port of call, “It hinges basically on obtaining a Buy American waiver,” said Dorine Petru, Alaska Marine Highway business manager.

In addition to making needed improvements at the terminal, the state needs a ferry that can serve the international route.

The ferry system has only two vessels that are certified under the International Convention Safety of Life at Sea (SOLAS) treaty. One of those, the Matanuska, has been laid up since 2022 because of extensive rusted steel and may never sail again for the state.

The expected repair costs are substantially above the $27.5 million the state has available for the Matanuska project, Marine Highway Director Craig Tornga said Oct. 23. A decision will be made soon whether to seek additional funding for the work or retire the ship.

Retiring the Matanuska would leave the state with one SOLAS-certified vessel — the Kennicott — but that ship will be out of service all next year for installation of new generators and other work.

 

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