DOT is expected to reject Todd Shipyards' bid to build new 50-car ferry

The state Department of Transportation is expected to reject a bid by Todd Pacific Shipyards to build a new 50-car ferry to serve Port Townsend and Keystone.

That decision could be made today or Wednesday.

"We think we won't accept the bid. It's not a good price. The price isn't reasonable," said DOT Secretary Paula Hammond, adding that the state may rebid the contract.

Todd was the only bidder last week to build what the state is calling a Steilacoom III, a boat modeled after a Pierce County ferry, Steilacoom II, that has been leased to the state for the Port Townsend-Keystone route.

Todd bid nearly $26 million to build the ferry, while Washington State Ferries had estimated the cost would be between $13 million and $17 million.

Hammond said she doesn't understand what went into the state's estimate or why the Todd bid came out so high, but Steve Welch, head of the shipyard, said one reason is the requirement that the boat be built in a year or the shipyard could face a $6,000-a-day fine.

David Moseley, head of the state ferry system, told a gathering of ferry riders Monday night in Bremerton that Pierce County has agreed to extend the loan of its boat until October 2009, which might give the state more breathing room in getting a new ferry built.

However, a spokesman for Pierce County Executive John Ladenburg said the county has only agreed to extend the lease until August 2009. The state has asked for another two months, but no decision has been made.

Hammond pointed out that the Pierce County boat, nearly identical to the one the state wants to build, was built by Nichols Brothers Boat Builders from Whidbey Island in 2005 for $12 million. "The bid has doubled. We're not sure why," Hammond said.

Welch asserts that Nichols Brothers underbid that boat and later went bankrupt.

Hammond said the state has been scouring the nation looking to buy or borrow ferries, but has been unsuccessful.

One issue raised in Bremerton is whether the state requirement that the boat be built by a Washington shipyard makes sense with only one bid for the new ferry.

Hammond said she was shocked that there was only one bidder, and up until the day the bids were opened fully expected to have at least two bidders. "We thought a little competition would be healthy. It's not a good climate when you only get one bidder," she said. "We don't know if this speaks badly for boats built in Washington. We want boats built here and maintained here. I'd hate to see us build up an industry in another state, but we have to look very carefully at that."

In a letter to Moseley, Welch listed several changes that need to be made to the Pierce County ferry design to meet the state requirements, and said that's one reason the bid was so high.

"The compressed schedule has made the procurement of key, long lead-time equipment such as the propeller and shafting very risky," he wrote. "While each individual change may seem inconsequential, the sum of these changes has resulted in a vessel procurement that is not the Pierce County ferry."

Welch also wrote, "should the state be amendable to revised contract terms, I am confident we could quickly agree on ways to more efficiently design and build this important vessel."

Hammond said what the state won't do is refurbish the 80-year-old Steel Electric Class boats that she pulled out of service in November. "The benefit's not there," she said. "It would require too much hull repair."

The state originally planned to build three boats like the Steilacoom II, but now said it will build just one of those boats and two of the Island Home design, a boat that operates in New England. The state will look at how quickly those boats could be built.

The Legislature this year appropriated $84.5 million to build three new boats to replace the Steel Electric Class vessels.

Susan Gilmore: 206-464-2054 or sgilmore@seattletimes.com