Court ruling reverts Whatcom County ferry fares; county outlines funding path and timeline for a smaller replacement vessel

A recent court judgment requiring Whatcom County to revert ferry fares to the May 31, 2024, schedule and barring use of certain cost items in the rate base dominated discussion at the Whatcom County Ferry Advisory Committee meeting on Jan. 27. County staff told the committee they are working with federal and state grant programs, refining a smaller 20-car vessel design and terminal scope, and trying to answer islanders’ questions about how any overpaid fares will be refunded.

The ruling and refund implications mattered immediately to island residents. Ferry Master Gary Poole told the committee that work on short-term operations is continuing and that a scheduled dry dock for the vessel is expected to be completed within a two-week window no later than May 18, 2025. "We plan to get the contract material to be back in service no later than May 18th," Poole said. County staff also described ongoing forensic analysis of a recent cable failure and said inspectors found corroded internal wires, which helped avert a larger hull or mechanical failure.

Why it matters: island residents said higher fares threaten daily life, school enrollment and medical access. Committee members pressed county staff on (1) how the county will comply with the court judgment and reimburse riders, (2) whether the county has been saving replacement funds as required by state rules, and (3) how the county will fund a replacement vessel after escalating project costs forced a scope change from a planned full-electric 34-car ferry to a smaller 20-car hybrid design.

County funding picture and grant work: Public Works Director Liz Kossoff and staff said Whatcom County has requested a scope change with the U.S. Maritime Administration (MARAD) for an existing rates grant and is finalizing responses to MARAD questions; staff expect to submit answers early the week after the meeting. County staff also said the County Road Administration Board (CRAB) previously awarded a $10 million County Ferry Capital Improvement Program grant to Whatcom County and that $5.3 million appears in the state capital budget tied to a 34-car description; staff will seek to convert or protect that allocation for a replacement "or replacement vessel and terminal work" while they pursue legislative help in Olympia.

Timing and delivery: County engineers told the committee that, if funding and permits follow the revised plan, terminal permitting and dock work could begin in summer 2027, with vessel construction taking about 18 months. Staff estimated terminal work could be complete in winter 2028 and the new ferry enter service soon after that.

Refund mechanics and legal questions: Committee members and island residents pressed the county on how refunds will be handled for fares collected under the higher rates. The county said it will consider administrative remedies to avoid individual lawsuits but offered no detailed refund process at the meeting. A committee member who had litigated the fare changes told the group the court had found island farepayers had standing and described parts of the trial ruling; county staff said they would follow the judgment and work on an administrative approach and would provide written follow-up to questions the advisory committee raised.

Replacement reserve (ER&R) and compliance: Committee members asked about the county ER&R (equipment rental and replacement) fund. Public Works staff acknowledged the ferry has not had a fully funded replacement reserve comparable to the vessel’s lifecycle cost and said incorporating full replacement funding into the rental rate would make the short-term user rate unaffordable. Staff said the county is aware of the gap and will begin addressing it going forward; they also said any repayment or replacement funding plan will need to be negotiated and coordinated across county budgets.

Operational and shorter-term items: Gary Poole reported that an electronic ticketing pilot would begin March 17 for some services; staff said they are studying electronic systems used by other counties and noted some installations have high up-front costs (participants cited Pierce County's million-dollar implementation). Poole and other staff said the current vessel uses about 2,000 gallons of fuel every two weeks (roughly 120 gallons per day) and that operational changes — such as running on a single main engine during slow periods and using underwater inspections in lieu of frequent dry-docking — have already produced savings.

Next steps and follow-up: County staff said they will (1) finalize and submit MARAD responses, (2) present to the CRAB board to keep the $10 million award for Whatcom County, (3) pursue conversion of the state $5.3 million appropriation with legislative partners, (4) provide written answers to the advisory committee’s questions about ER&R and administrative refund options, and (5) continue forensic work related to the recent cable failure. Committee members requested the county present a clear administrative refund plan and timeline as soon as possible.

The advisory committee planned to pass the committee’s recommendation on to the County Council at its Jan. 28 meeting for any appointments and to remain engaged on grants, refund mechanics and the replacement-ferry procurement timeline.