Feds inject nearly $300M into Alaska Marine Highway System for improvements

As the Alaska Marine Highway System turns 60, the federal government this week announced $285 million for improvements.

The money is intended to modernize and replace vessels, upgrade docks and invest in long-term resilience.

“This is great news for our infrastructure, but also for our state’s economic future going forward,” Alaska Republican Sen. Lisa Murkowski said Thursday in a media event with Transportation Secretary Pete Buttigieg.

The ferry system serves 3,500-plus miles of Alaska’s coastline and more than 30 communities, many of which are unreachable by road. It has struggled for years with mechanical breakdowns, service interruptions and occasionally stranded passengers.

The $285 million comes from the 2021 Infrastructure Investment and Jobs Act, which both of Alaska’s U.S. senators voted for and Murkowski helped negotiate.

About $72 million will go toward modernizing four vessels, including some of the largest and oldest in the fleet. For example, on the 60-year-old ferry Matanuska, passenger and crew quarters will be refurbished, safety improvements will be made, and old steel, plumbing and electrical materials will be replaced.

Another $68 million will help replace the Tustumena, which serves Kodiak, the Kenai Peninsula and the Aleutians. Constant upkeep of the vessel would be more costly than investing in a new ship, according to the project proposal.

[Dunleavy administration unveils 5-year plan to replace aging Tustumena ferry with new vessel]

Among other investments, the funding will also be used to upgrade dock infrastructure in Juneau and Cordova and entirely replace docks in Pelican, Tatitlek and Chenega. The investment will also help construct an electric ferry and lower the ferry system’s emissions.

The federal dollars require an approximately $105 million match from the state of Alaska. The Alaska Legislature has already appropriated some of those funds — and will need to appropriate more — but it’s currently unclear how much. Gov. Mike Dunleavy is set to release an amended budget proposal in February that should provide more clarity.

Southeast Conference Executive Director Robert Venables said he expects the state to pay the matching funds, and that missing out on the windfall from the federal government “would be like looking a gift horse in the mouth.”

Venables said age presents a major challenge to the system.

“We’ve got vessels that are 60 years old that we’re still trying to patch up and use and others that are kind of mismatched,” Venables said.

Daily News reporter Sean Maguire contributed from Juneau.