The Steamship Authority (SSA) unanimously approved entering a contract nearing $30 million to convert two newly purchased freight boats.
The authority had estimated spending $9 million per vessel conversion, but the lowest bid that came in, from Alabama Shipyard, turned out to be $20 million per vessel conversion.
The SSA board was struck by sticker shock, and the authority’s staff entered into negotiations with the shipyard in an attempt to reduce costs.
The negotiations paid off, although only two of the three freight ferries that the authority purchased will be converted under this contract. SSA general manager Robert Davis said converting the Aquinnah and the Barnstable will cost $13.6 million each. The Monomoy is included in the contract, but Davis said the SSA will continue to negotiate with Alabama Shipyard for the scope and pricing for that vessel’s conversion.
Davis said the Aquinnah and Barnstable are expected to be delivered to the SSA by next April, in time for the 2024 summer season.
The board was still not thrilled with the underestimate on the conversion fees.
“I think you put the board in a very tough position, given the colossal failure in terms of the estimates for converting these boats,” board member and Falmouth representative Peter Jeffrey said. “Now we’re left with what is the most financially prudent thing to do for the Steamship Authority, and not as the best of circumstances.”
Jeffrey said he’d been asked by the public whether the SSA considered reselling the vessels and restarting the process. Davis said that was not an option they were considering.
“We’re not pleased either that we put the board in such a position,” Davis said. “We missed this by a wide margin, and we’re going back and seeing how this was done.”
Davis pointed out that during a recent forum, Ferries Now, others in the industry said they’ve also seen costs going up. “Regardless of that, we do feel these vessels remain a very viable avenue for us to be able to modernize our fleet,” Davis said.
Jeffrey said he would like the board to receive the progress report in “real time” so they can stay on top of any change orders and other costs throughout the process.
Martha’s Vineyard board representative Jim Malkin asked whether parts of the contract could be delayed for a better price, but SSA director of marine operations Mark Amundsen said they were at the reduced scope already. He said they could decide to make fewer changes to the vessels, but that could limit them to just the Martha’s Vineyard route.
After further discussion, board vice chair and Barnstable representative Robert Jones suggested going ahead with the presented contract, rather than changing course.
“Let’s just go lick our wounds and be done with it,” he said.
After the unanimous vote, Malkin said he looks forward to the audit report on how the SSA ended up in this situation. He’s also curious how the contract will impact other capital projects.
Jeffrey agreed, and said it may be beneficial to have Mark Higgins, who recently joined the SSA as the COO, review the process and bring an outside perspective.
This is the same board that gave Bob Davis that rated him A+, gave him a raise in double digits to push his salary to over $200K and is leaving the islands and the ports to pay for his negligence? The board should take some of the money from his salary, he can pay for part of his shoddy bargaining and inaccurate claims to the board. Hint: to any and all board members or friends and family thereof, whose eyes are grazing this comment, stop giving perfect scores to someone like this, you have been patting him on the back, what do you expect? When you tell someone they’re doing great, give them raises, without accountability?
If only the SSA could get good people.
What is your availability?
Random repost:
CASH, n. Money; primarily, ready money, money in chest or on hand, in bank or at command. It is properly silver and gold; but since the institution of banks, it denotes also bank notes equivalent to money. To pay in cash is opposed to payment in goods, commodities, or labor, as in barter.
CASH, v.t.
1. To turn into money, or to exchange for money; as, to cash a note or an order.
2. To pay money for; as, the clerks of a bank cash notes when presented. ++(MONEY, n. plu. moneys.
1. Coin; stamped metal; any piece of metal, usually gold, silver or copper, stamped by public authority, and used as the medium of commerce. We sometimes give the name of money to other coined metals,and to any other material which rude nations use a medium of trade. But among modern commercial nations, gold, silver and copper are the only metals used for this purpose. Gold and silver, containing great value in small compass, and being therefore of easy conveyance, and being also durable and little liable to diminution by use, are the most convenient metals for coin or money, which is the representative of commodities of all kinds, of lands, and of every thing that is capable of being transferred in commerce.
2. Bank notes or bills of credit issued by authority, and exchangeable for coin or redeemable, are also called money; as such notes in modern times represent coin, and are used as a substitute for it. If a man pays in hand for goods in bank notes which are current, he is said to pay in ready money.
+(: TEND’ER, n. [from tend.] One…1. A …
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All conditions, all minds tender down
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Still don’t understand why the boats are undergoing conversion now with being electrified. Will it add to the conversion cost? Sure, but the additional cost will be recouped by reduced operating costs over the lifetime of the vessels. Surely, it will cost quite a bit more to bring then back at some later date for electrification. Why are Denmark, Sweden, Casco Bay, Washington State starting electrification of their fleets and the SSA has nothing planned?
Electrifying these boats should not cost more than twice as much as the rest of the work planned.
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