Republican-Appointed Alaska DOT Commissioner Ryan Anderson: “What is going on in Washington, D.C.? That’s always a tough thing to work with”
Alaskans are bracing for a “partial or total shutdown” of our ferry system as Sen. Dan Sullivan’s federal funding cuts wreak havoc on our state’s critical transportation infrastructure and could force the Alaska Marine Highway System to “tie up its ships in midsummer, at the peak of the state’s annual tourist season.”
Dan Sullivan – who sits on the Senate DOGE caucus – backed DOGE federal spending cuts, fueling the “federal chaos,” pledging to work “very closely with Elon Musk and that department.” Now, Alaskans are paying the price for Sullivan’s self-serving incompetence as he is predictably silent on the looming crisis he created, threatening crucial services in our state.
“Once again, Alaskans are being forced to pay the price for Dan Sullivan’s incompetent, self-serving agenda in D.C. Because of Sullivan’s funding cuts, our ferry system could shut down in the middle of summer – harming communities, crushing small businesses, and putting tourism jobs at risk,” said Alaska Democratic Party Chair Eric Croft. “In a state as large and remote as ours, our ferry system is a lifeline for our rural communities. Now, Sullivan’s failure to show up for our state will leave those communities cut off. Sullivan has abandoned Alaska, and in November, we will hold him accountable.”
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Alaska Beacon: Alaska’s ferry system could run out of funding this summer due to ‘federal chaos problem’
By James Brooks
February 3, 2026
Alaska’s state ferry system is at risk of a partial or total shutdown this summer due to the failure of the federal government to issue a key annual grant.
“Currently right now, we have a shortfall in our budget,” said Dom Pannone, director of program administration and management for the Alaska Department of Transportation and Public Facilities, to members of the Senate Finance Committee during a Monday morning hearing.
Money from the Federal Transit Administration’s rural ferry program pays for almost half of the Alaska Marine Highway System’s operating expenses, but the administration failed to open its annual grant process in fiscal year 2025, which ended Sept. 30.
The ferry system’s budget runs according to the calendar year. Last spring, the Alaska Legislature and Gov. Mike Dunleavy budgeted $171 million for the 2026 ferry budget. Of that, almost $78 million was supposed to come from the rural ferry program.
Without that money, the system could be forced to tie up its ships in midsummer, at the peak of the state’s annual tourist season.
“Right now, we have a federal chaos problem,” said Sen. Jesse Kiehl, D-Juneau and a member of the Senate Finance Committee.
If a federal grant isn’t delivered, DOT would make significant changes to the summer ferry schedule, which is slated to begin in May.
On Monday, neither DOT officials nor state legislators could say why the Federal Transit Administration has failed to make grants available.
“What is going on in Washington, D.C.? That’s always a tough thing to work with,” Anderson said.
In each of the three prior grant years, it took between 152 and 199 days from the time the grant application period opened to the time the grant was awarded.
That timeline means that even if federal transit officials were to open the grant process tomorrow, a decision might not be made before the start of the summer ferry schedule in May.
Sen. Bert Stedman, R-Sitka, said that finding “backfill” money will be difficult in either case.
“Our budgets are getting tighter and taking away the flexibility the (finance) committee has to backfill some of these holes, and this particular hole could be significant, pushing $80 million,” he said.
The ferry funding issue could persist even if the federal transit authority resumes paying grants, because its ferry operations program is set to expire this year.
“What happens when that grant money is gone?” asked Sen. Mike Cronk, R-Tok.
“This year, the surface transportation reauthorization is up for renewal,” Anderson said. “This, we understand, is part of that discussion: Will the rural ferry program continue over the next subsequent four years?”
Anderson said that even if Congress renews the program, the current Alaska-favorable rules might be rewritten.
“Other states are very interested in this program as well because they have a lot of similar challenges,” he said. “Nationwide, there’s support for a program such as this. The questions that are out: How will the rules be rewritten, and how competitive will the program be? That will be the challenge.”