Gov. Chris Gregoire announced her plan to change the Washington state ferry system by creating a Puget Sound Regional Ferry District and eliminating the existing Washington State Ferries portion of the state Department of Transportation.

“Our current system lacks two critical things,” Gregoire said. “A dedicated source of funding and local leadership…to oversee a well-defined mission.”

The new ferry district would include Clallam, Jefferson, Kitsap, Island, San Juan, Skagit, Snohomish, King and Pierce counties.

According to Gregoire and a report created by the Passenger Vessel Association, privatization of the Washington state ferry system is not possible because fares would have to be raised extensively to generate a profit and people would no longer ride the ferries.

The Puget Sound Regional Ferry District would be funded by fares, a state subsidy, and regional taxing authority, which Gregoire said will be decided by the district and will only affect the nine counties.

In 1999 when voters repealed I-695, the motor vehicle excise tax (MVET), which supported Washington State Ferries, the ferry system lost one-fifth of ferry operational funds and three-quarters of its capitol funds.

Since then the state has been bailing out Washington State Ferries by using highway funds, amounting to $760 million over the past 11 years. The ferry system has been making cuts of $28 million per year and has eliminated 35 employee positions, but will still lose $900 million over the next 10 years.

“We cannot Band-Aid the system any longer,” Gregoire said. “We’ve taken from the highway system as much as we can.”

Washington state ferries serve 23 million people per year, and Gregoire said she considers ferries to be part of our highway system.

“There is no way to solve the problem unless we find ourselves a different way to do business,” Gregoire said.

“The system is not financially sustainable,” said David Moseley, assistant secretary for Washington State Ferries, “It hasn’t been since the loss of the MVET…The one thing I do know is we can’t keep doing what we’re doing now. That won’t work.”

Despite the major change, Gregoire said, “I don’t want anyone to think that the state is going to give up on our responsibilities.”

Senators Mary Margaret Haugen, (D-Camano Island), who is also chair of the Senate Transportation Committee, Jim Hargrove, (D-Hoquiam), Derek Kilmer (D-Gig Harbor), Kevin Ranker (D-San Juan Island) and Tim Sheldon (D-Potlatch) issued a statement Jan. 6 declaring their opposition to the creation of a ferry district.

“The state’s not asking Seattle residents to pay special taxes for the tunnel or the 520 bridge. It’s not asking Spokane residents to pay special taxes for the North-South Corridor. It’s not asking Vancouver residents to pay special taxes to pay for the Vancouver-Portland Bridge. Our ferries are no less a part of the state highway system than these projects.”

The Washington State Legislature is expected to consider the governor’s proposals during its session, which opens Jan. 10 in Olympia.