Saga of the Susitna ferry nearing its end

PALMER — Borough officials will be able to sell the M/V Susitna with little trouble after all.

U.S. State Department officials ruled that the ferry was not covered by export controls, despite being a one-of-a kind icebreaker intended for use between Port MacKenzie and Anchorage, attorney Nick Spiropoulos told the Mat-Su Borough Assembly Tuesday. Federal approval had loomed as a possible roadblock to the vessel’s sale to the Red Cross of the Phillipines, and the ruling clears the way for the sale to go ahead.

The vessel is a one-of-a-kind prototype of a potential icebreaking landing craft originally developed by the Department of Defense. It was given to the borough for free, though Anchorage officials ultimately declined to consider a ferry landing on the city side of the Cook Inlet, leaving the borough with about $2 million spent on a ferry which has never been used, and an additional $12.5 million in Federal Transit Authority loans used to construct a ferry terminal at Point MacKenzie — which is now being used as office space.

The State Department ruling means neither it nor the Department of Defense can veto the sale, Spiropoulos said. The Department of Commerce maintains jurisdiction over the sale, but put the ferry export in its lowest classification, meaning federal approval will not pose a major interference, Spiropoulos said.

“What that means is, from a practical sense, when we export it, if the sale goes through, we’ll have to file an export notification when it’s shipped,” he said. “The form of that export notification will depend on how it’s shipped. If it goes under its own power, it’s one set of paperwork to be filed. If it’s on a barge it’s a different set of paperwork to be filed.”

Additionally, the sales agreement may have to be amended to prevent resale.

The assembly also introduced a measure that would approve the first $250,000 of the ferry’s $1.75-million purchase price. If approved, the deposit would repair the ferry’s damaged engines. Severe rains damaged the ferry in January, meaning it’s currently inoperable.

Contact reporter Brian O’Connor at 352-2270, brian.oconnor@frontiersman.com, or on Twitter @reporterbriano.