Ferry bid exceeds state's estimate

The sole bid for building a new 50-car ferry to run between Port Townsend and Keystone hit turbulence Thursday when it came in at least $9 million over the state's estimate.

Todd Pacific Shipyards bid nearly $26 million to build the ferry.

Washington State Ferries had estimated the cost would be between $13 million and $17 million.

It's not clear what the high bid means, but David Moseley, ferries director, said he was disappointed.

"We'll have to evaluate it and look through it carefully," he said. "We hoped there would have been more than one bidder and within the engineer's estimate."

Regardless, said Moseley, the boat will get built. The state could reject the bid and negotiate with Todd to try to bring down the costs.

Plans call for the bid to be awarded Wednesday.

But Steve Welch, head of Todd Pacific Shipyards, said his company tried to get the costs as low as possible. He thought the state's estimate was too low.

Gov. Christine Gregoire Thursday said she asked for a "thorough review by Transportation" to discover how its estimate could have been so far off.

The ferry will be built nearly identical to the Steilacoom II, owned by Pierce County and now loaned to the state for the Port Townsend-Keystone route. Welch said the cost of that boat was $12.5 million, but he believes it actually cost much more to build. The shipyard that built it, Nichols Brothers, later went bankrupt.

Welch said there are many other factors driving up the cost, primarily the edict that the boat be built by May 2009 or the shipyard will face a $6,000-a-day fine.

"We're sobered by $6,000 a day," Welch said, adding that the timetable is very tight. "I'm concerned. It's possible but extremely difficult."

The one thing that could delay construction and wouldn't penalize Todd is a labor dispute. Many of the major unions at Todd have contracts that expire this summer.

Other factors that drove up the cost were changes in safety, design and equipment, Welch said.

The Legislature this year appropriated $84.5 million to build three new boats to replace the 80-year-old Steel Electric Class vessels that were pulled out of service in November because of damaged hulls.

Initially, the state had planned to build three 50-car ferries, using a design crafted by Elliott Bay Design that was used to build two Pierce County ferries, including the Steilacoom II.

Instead of building three of the 50-car boats, the state will build one. Two will be built using an Island Home design, a larger craft used in New England. The Island Home is also by Elliott Bay Design.

Had the state sought bids on three identical ferries, the price likely would have been lower, Welch said.

Ferry officials have estimated that the two Island Home boats will cost about $30 million each. Plans call for the second and third boats to be completed in 2010.

The contract for the new boat was open to any Washington shipyard, and ferry officials had expected a bid from Everett Shipyards. But that didn't happen.

Kevin Quigley, president of Everett Shipyards, said he was prepared to submit a bid and had done all the work, but when he took it to his board of directors, members decided it was too risky and the bid was abandoned.

The fact that only Washington shipyards could bid on the boats has caused some to question whether that's a good policy.

"This brings up the question: are we locked into using state shipyards for vessels?" said Tim Caldwell, of the Port Townsend Chamber of Commerce. "If there's only one bid, that can be a problem. It's a logical question. Are we beholden to one bidder in the state or do we need to take a few steps back and do an analysis?"

Welch said Todd has turned down jobs to keep the shipyard clear to build the new state ferry.

And if the state wants to try to renegotiate the price?

"If the customer asks to talk to us, we'll be happy to," he said.

Today's bid opening was the first time since 1995 that the state has asked for bids to build a new ferry. In 1995, the state opened bids for the Mark II fleet, which includes the Wenatchee, Puyallup and Tacoma ferries.

Andrew Garber contributed to this report.