News - Local News

POSTED: Saturday, Nov. 21, 2009

Fairhaven Shipyard hoists Alaska ferry despite federal warning

Parties to conflict sound upbeat after meeting

BELLINGHAM - Fairhaven Shipyard used its new drydock to lift the Alaska ferry Kennicott on Friday, Nov. 20, despite a warning from the U.S. Army Corps of Engineers that the operation could violate federal law.

But by Friday evening, there were hopeful signs that the shipyard and the Port of Bellingham might work out an agreement with Lummi Nation that would resolve the legal difficulty.

Tribal officials met Friday afternoon with port officials and Neil Turney, president of shipyard parent company Puglia Engineering, at the office of port attorney Frank Chmelik. The shipyard is a port tenant.

After the meeting, the port's acting executive director, Fred Seeger, said the talks had gone well.

"We had a very productive discussion," he said. "I am optimistic that we can come to a resolution."

Turney agreed.

"It felt like it was positive," he said.

On Thursday, Nov. 19, Turney had said his company needed to get started on the $5 million ferry refurbishing project, and could not wait until issues with Lummi Nation were resolved.

Turney said he had thought he was within days of getting the Army Corps permit he needed to put the company's refitted drydock into operation for the first time.

But on Nov. 10, tribal representatives raised environmental issues and told Turney they would block his permit unless he agreed to the payment of an "impact fee" of as much as $20,000 for each lift and launch. Turney has refused to make any such payment.

The tribe's approval is required on many waterfront projects because federal courts have recognized that the Lummis and other tribes have a treaty-guaranteed right to make a living harvesting salmon, crab and other marine resources.

Federal permits for any waterfront project with potential impact on marine resources can be stopped by tribal objections.

Turney had hoped he might be able to get around his permit problem at the Fairhaven location by moving the drydock, christened "Faithful Servant," to the Port of Bellingham's shipping terminal to the north. But on Thursday, Nov. 19, Army Corps project manager Erin Legge warned him otherwise.

"If this activity is completed without Corps authorization, it may be considered a willful and knowing violation of the Rivers and Harbors Act," Legge wrote in an e-mail provided to The Bellingham Herald by Turney.

On Friday, Turney shrugged off that warning.

Shipyard workers and two Foss Maritime tugs spent much of Friday maneuvering the Faithful Servant into deep water, submerging it, and slowly easing the big blue ferry into place, while clusters of spectators watched from vantage points at Boulevard Park and the Taylor Avenue boardwalk.

"We had no choice," Turney said in a telephone interview. "We had to push this issue today. We couldn't wait any longer."

In his e-mail reply to the corps, Turney said the survival of his company and its 150 workers was at stake.

"We have invested ALL of our resources into this business expansion and job creation project," Turney wrote. "We ARE on the brink of bankruptcy due to the delays in getting the first lift accomplished and the necessary refinance of this asset."

Turney also told the corps he had dropped plans to use the port shipping terminal and would simply return the Faithful Servant to the shipyard pier in Fairhaven once the Kennicott was aboard.

Another corps official, Muffy Walker, said Friday that Turney and his company could face a wide range of consequences. In some cases, she said, the corps grants permits after a project has been completed. But a violator also can be ordered to undo any work done without a permit, and in extreme cases, the corps can go to the Department of Justice for criminal prosecution.

But Walker, chief of the corps' regulatory branch in Seattle, said the first step is a mild one: The corps will mail a stop-work order to the company.

Lummi Indian Business Council Chairman Henry Cagey said early Friday he had no immediate comment.