Construction on Islander Replacement Resumes at Full Tilt After
Hurricane

By James Kinsella
Gazette Senior Writer

While work has resumed on the Steamship Authority's new Island
Home car and passenger ferry, the vessel will not be delivered until a
year from now.

The vessel, which is slated to replace the Islander on the
Vineyard-Woods Hole run, originally had been scheduled for delivery next
June.

The ferry now is scheduled to be launched July 17 at the VT Halter
Marine shipyard in Pascagoula, Miss., according to Carl Walker, director
of engineering for the boat line.

Mr. Walker's update on the ferry construction project came at
the monthly Steamship Authority meeting in Woods Hole yesterday morning.

Late last month Mr. Walker visited the shipyard, which was battered
along with the rest of the Gulf Coast in August by Hurricane Katrina.
After a hiatus caused by the hurricane, shipyard employees have resumed
work on the Island Home.

In other news yesterday, boat line managers announced a Nov. 29
meeting with the Oak Bluffs conservation commission to discuss the
revised plans for the Oak Bluffs terminal; and reported that two private
licensed carriers, Hy-Line and Cape and Islands Transportation, have
requested permission to carry more passengers. Senior managers also took
the wraps off a new merchandising program that will include the sale of
coffee mugs and watercolor prints through the boat line's web
site.

As for the Island Home, SSA general manager Wayne Lamson has said
the boat line will continue to run the Islander on the Vineyard route
until the replacement ferry joins the fleet.

Mr. Walker said about 70 per cent of Halter's employees have
returned to production work. Just a few weeks ago, 50 per cent of the
employees were still engaged in clean up and shipyard reconstruction. In
recent weeks, Mr. Walker said Halter employees attached a bow to the
Island Home hull.

As of Sept. 30, the boat line had spent $10.7 million on the vessel;
total construction cost is expected to be $32.8 million. Mr. Walker said
vendors providing materials for the Island Home are being paid, despite
the damage done to the shipyard by the hurricane.

He reported that construction work is under way on two other SSA
vessels: the freight boat Sankaty, slated to receive a mid-body addition
at the North Florida Shipyard in Jacksonville, Fla., and the boat
line's new Nantucket high speed ferry, which is under construction
at Gladding-Hearn shipyard in Somerset.

The requests from both the Hy-Line and Cape and Islands Transport,
which runs the Pied Piper seasonally on the Falmouth-Edgartown route, to
carry more passengers or run more trips, drew skeptical remarks from
boat line governors, including Vineyard governor and board chairman Marc
Hanover. Licenses issued by the SSA for both of the private ferries
expire at the end of the year.

Mr. Hanover said he agreed with a concern expressed by port council
member Eric Asendorf about whether the SSA is cannibalizing its own
business if it allows the private carriers to expand.

Murray Scudder, Hy-Line's vice president for operations, said
the company wants to expand the allowed number of passengers on the Grey
Lady, the high speed ferry that operates on the Nantucket route in
competition with the SSA's high speed ferry Flying Cloud. The Grey
Lady is currently limited to 149 passengers, and Hy-Line owners want to
expand to the Coast Guard-rated capacity of 298 on a year-round basis.

The SSA has allowed Hy-Line to carry more passengers only when the
Flying Cloud is out of service, when fog closes down the airports, or
when large school groups are traveling.

"In the present environment, with consumer preference for
ferry travel clearly favoring high-speed service as the preferred mode
of transportation, it makes little sense to Hy-Line, the Authority or
the public to restrict the capacity and force the public to travel on
less desirable traditional ferries or at less desirable times,"
Mr. Scudder wrote in a Nov. 14 letter to the SSA.

The owners of the Pied Piper, meanwhile, would like the option of
running an additional ferry trip off-Island on Sundays and holidays as
demand dictates.

Boat line governors are expected to vote on the requests at their
meeting next month.

In his monthly business report, Mr. Lamson said passenger traffic
remains down; for the first nine months of the year, passenger traffic
is off 2.2 per cent compared with the same period last year.

Automobile traffic was up .1 percent for the month of September, but
down 1.2 per cent down for the first nine months of the year. Truck
traffic was up 13.3 per cent for the month, and up 11 per cent for the
first nine months of the year.

Boat line governors voted 4-0, with Barnstable governor Robert
O'Brien abstaining, to reappoint Deloitte & Touche LLP to
provide a financial audit and related services for the fiscal year
ending Dec. 31. The SSA will pay the firm $97,000.

An attempt by the boat line to draw more competition for the audit
through competitive bidding was unsuccessful.