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WASHINGTON STATE FERRIES |
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WSF CEO resignsposted 09/11/04
Thorne stated, "I have enjoyed the challenge and opportunity to lead change in a vital public organization. WSF is now well positioned to become more financially sound and is poised to offer greater service to its many customers. We have put a strong business plan in place, shored-up revenues, implemented measures to make the system more safe and secure, and have begun the long process of rebuilding our fleet and facilities." Reflecting on Thorne’s tenure at the ferry system, Secretary of Transportation Douglas B. MacDonald praised Thorne’s strong, focused leadership and his efforts in developing a forward-looking business and financial plan. "Mike has done a first-class job in one of the most thankless and difficult jobs in Washington State government. He chartered new waters and he has greatly structured the finances and operation of the system. He leaves the organization in a much stronger position poised for further future success. More work remains. Mike’s leadership will be missed but the new course for WSF will be continued." Thorne was appointed to his position as CEO of the ferry system by Secretary MacDonald in January 2002 following an intensive nationwide recruitment effort. Thorne came to the ferry system from Portland, Oregon, where he served 10 years as Executive Director for the Port of Portland. From 1971 to 1991 he served in the Oregon State Senate, occupying the pivotal position of chair of the Senate Ways and Means Committee. Following his departure as CEO, Thorne will be returning to his family ranch in Pendleton, Oregon where he plans on taking time to consider future business and professional opportunities. WSF CEO: 5-5-5 plan workingposted 07/09/04
The design process takes a year, construction of the ferry will begin in September 2005. The new ferries will have improved handicap accessibility and will be a little wider to better accommodate commercial traffic. WSF was able to finance the first ferry by reducing operating costs 10 percent during the past two years. The ferry system also pursued federal funding more aggressively than it has in the past. Legislation under consideration by the U.S. Congress includes $40 million for WSF. Thorne was asked at the July 8, 2004 San Juan Ferry Advisory meeting about the effect of the state legislature's mandate to have the ferries constructed in Washington State. "It effectively takes away any competition," Thorne said. "As a result of the state legislature's decision we will be paying a heck of a premium." WSF will have the engines and propulsion systems built out of state and will therefore be able to use federal funds to pay for those items. WSF hears from islandersBy Sharon Kivisto posted 01/31/03
WSF CEO Mike Thorne, CFO Sam Koons, and State Transporation Commission member Elmira Forner were among the officials in attendance. Forner lives in Manson by Lake Chelan. "We (the transporation commission) are very committed to the concept of One Washington" she said. "We recognize that the state ferry system is part of the highway system." Thorne explained his plan which by altering some service provides funds for capital improvements. By dropping the Sidney international run and eliminated the passenger only ferries, WSF saves more than $80 million in capital cost. That money can go towards buying two new ferries that will better serve the system. (More details of Thorne's plan are listed in the article posted below this one.) He noted that while the inter-island boat is due to be out of service on weekends in the winter starting in 2004, inter-island service will still exist. "We will work with you to provide the service," he said. Friday Harbor resident Jack Cory said he moved to the islands seeking "back roads." He voted against Referendum 51 and didn't object to cutbacks. "If prices for food and gas went up and there was less work. I say it is fine," he said. "Don't give us too much attention." San Juan Island resident Claudia Mills agreed with Cory. "I'm perfectly content to see less service. " Alex Taylor noted there were other areas such as San Francisco that used to have ferries and now have bridges. He said two fast ferries could be run between Anacortes and Decatur with a causeway to Lopez Island. While he doesn't expect to be alive to see it, he thinks by 2050 bridges will be built. Dick Brass asked if WSF had considered radical ideas such as gambling, a "soak the rich " reservation system or allowing private companies to provide ferry service. Thorne said he favors a reservation system (not the soak the rich concept) and would continue to push for it. WSF is reviewing its point of sale technology and plans to discuss reservation systems next year. Other San Juan Islanders wondered what the effect would be if more commercial traffic was barged over instead of carried on the ferries. Thorne said he didn't know. It would lead to a revenue loss, but it might also lead to less need for capital improvements. WSF is still taking comments. An open house and informational meeting will be held in Anacortes on February 3, 2003. WSF self-help plan cuts Sidney and passenger only ferriesBy Sharon Kivisto posted 12/19/02
By cutting some service, WSF could redirect or gain funding for $75 million of capital projects according to Thorne. He unveiled his "results oriented strategic plan" at the State Transportation Commission meeting yesterday, (December 18, 2003) in Olympia. Other service cuts affecting the San Juans include dropping the inter-island boat on weekends during the 12-week winter schedule. The other ferries would run on modified schedules on those days to fill in the gaps. The 6:35 p.m. Anacortes to Lopez, Shaw and Orcas would only run on Friday and Sunday during the winter. A complete list of cuts are listed at the end of this story. Discontinuing all passenger-only service was one of the most difficult decisions he said. With the defeat of Referendum 51 which would have used gas tax to help fund the passenger-only ferries, WSF was left without a stable funding source for them. “Spending $6 to get $1,with the capital problems we face doesn’t make sense. We just can’t continue to operate them," he said. "That $6 million could service debt on $60 million in equipment." Regarding the Sidney run, Thorne said,"If you take out the winter service, it essentially comes close to covering the operating costs. But there are substantial costs associated with equipment for that service. We’ve identified nearly $50 million (from the Sidney run) of the $75 million in capital needed." WSF will redirect the funds to other needs. Some of the capital will be spent on relocating the Keystone ferry terminal. "The key to this plan is the redesign of the Keystone terminal," he said. "By moving the terminal, we can replace two boats with one. With the current location we would have to build two new boats designed just for them." Without the need for special equipment for the Keystone run, WSF can work on standardizing the fleet, he said. In phase 2 of Thorne’s plan, two new boats would be built. "The most efficient boat for us to operate is the 130-car class vessel." Under the plan, one would be delivered in March 2008 for the Port Townsend route, the other in November 2008 for the San Juans. Secretary of Transportation Doug MacDonald praised Thorne’s work. "Mike’s dilemma was how to generate investment capital." he said. "The critical part is essentially this, in order to get the ability to invest, Mike needs money and he is prepared to go out and find money in the system." MacDonald noted it would not be fair to then penalize WSF by stopping the transfer of funds to the ferries from the general transportation fund. The notion that the state invests in capital for the ferry system even by people who don’t ride the ferries is important, he said. "If that overarching deal is not understood, this won’t work," he said. "It is really important that the ferry self help program continue to be integrated with state resources." The commission gave Thorne permission to proceed with his plan. Public outreach will be done and legislation necessary to enact some of the changes will be drafted. The state legislature will have the final say. MacDonald stressed the need for support for the plan. He said, "Some of these things will create a firestorm. Some of the opposition will be directed through legislators. We need to work with Mike to back up the program." San Juan Ferry Advisory Committee Chair Bob Distler addressed the commission during public access time. He reiterated the idea that the ferries are part of the state highway system. "From my perspective, Mike Thorne shares the Secretary’s view of the integrated nature of the state transportation network," he said. "We need to allow Mike Thorne to do what everybody expected him to do when he was hired. This is part of an integrated and sustainable solution." While the plan will be painful, it is important to be dealt with as a whole and not picked apart, he said. "The plan is finely balanced," he said. "The pieces fit together. It has to hold together." He pledged to help spread the message. The following is from material WSF distributed at the December 18, 2002 State Transportation Commission Meeting THE CAPITAL FUNDING PLANThe Capital Funding Plan leverages the 5+5+5 business plan formula previously mentioned. We’ve added a new chapter to the plan that addresses our immediate capital funding needs by making changes to our current service plan. It’s a straightforward formula:
These changes reduce our operating costs and ultimately provide the ability for Washington State Ferries to self-finance some of our most urgent capital needs. The Capital Funding Plan is also based on continuing the financial assumptions made in the Washington State Department of Transportation and WSF current law budget and ten-year-financing plan. PHASE ONE HIGHLIGHTS2003-2005 Phase One is effective June 15, 2003 and takes us through 2005. . It includes the vast majority of the service changes. These particular changes were identified because they provide substantial savings in operating costs, affect the fewest number of riders, leave no one without a transportation alternative and ultimately ensure a viable ferry system. Adopt a 12-week winter Schedule Season -
January to late March
Make year-round changes on several routes. Net annual savings: $6,175,000.
Place two vessels in standby status. Net annual savings: $1,250,000.
Surplus five passenger only and two auto ferries. PHASE TWO2005-2013 Phase Two is a longer-range plan that takes us through 2013. Phase Two includes building at least two new boats (possibly three) and relocating an existing terminal. These capital projects are critical to the ferry system infrastructure. Remember, the money we save from implementation of Phase One provides funds for the work scheduled through 2013. Phase Two of the plan spans the period from 2005-2013. During this phase, we will construct and take delivery of the new vessels and begin service at the new terminal. During this eight-year timeframe, we also expect to retire four more auto ferries and discontinue service to Sidney, B.C. We will be exploring the possibility of auto ferry service between Vashon and Southworth into Pier 52 (downtown Seattle) that could result in the permanent closure of the Fauntleroy ferry terminal. We will also be exploring a new focused approach to the maintenance facility located at Eagle Harbor and exploring alternative sites for the facility as suggested in a recent legislative oversight committee report.
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