Islanders discuss funding for ferries, tolls at community meeting

By Connie Leinbach

Tolling the Hatteras ferry could be a boon for Ocracoke.

That’s one point the Ocracoke Access Alliance made at a community meeting March 31 in the Ocracoke Community Center.

Since it was formed last fall, the alliance has visited legislators in Raleigh and Washington, D.C. Justin LeBlanc, alliance executive director, and Bob Chestnut, an alliance member, recently visited legislators in the nation’s capital and learned about the federal funding that the Ferry Division is missing out on because no one is pressing the island’s case.

“It’s essential that we have someone in D.C. talking about this,” Chestnut said about the critical issues for which Ocracoke needs funding, such as the north end ferry basin, the sandbag area and the ferry system. “Without pressure from us, we’re going to be left out.”

While the two did not get to meet with two of the island’s representatives, Senator Thom Tillis and Rep. Greg Murphy, they met with their staff.

Alliance members LeBlanc, Chestnut, Amy Howard and Garick Kalna visited Raleigh in January when the GA was not in session. Although they also met only with representatives’ staff members, the group gleaned information in their quest to advocate for Ocracoke.

In their budget last year, the N.C. Senate included a $20 toll on the Hatteras ferry and increases to the Pamlico Sound ferries, but the House’s version had no tolls.

Since neither budget has passed, the state has been operating on last year’s budget, but that may change when the General Assembly (GA) reconvenes on Monday (April 6).

If islanders don’t get involved in the ferry toll decision process, “someone else will decide for us,” Howard noted.

Now, the group has devised a white paper it will present to the General Assembly later this month.

Principally, the group says that if the GA demands a toll on the Hatteras ferry, then Ocracoke would like them to fully fund the Ferry Division.

That means, not only enough money to run all the ferries in the fleet but also to appropriate $69 million to pay for the backlog in maintenance.

By law, revenue from ferries that are tolled must go into a ferry replacement fund in the NCDOT district in which the tolled ferry operates.

A Hatteras toll would go into the fund for it and the Swan Quarter ferry, since those are in NCDOT’s District 1.

The Cedar Island ferry is in Carteret County, which is in another district.

Toll revenues cannot be used for operations, LeBlanc said.

In 2024, the GA charged the Ferry Division to come up with a schedule to replace all 26 vessels. That plan showed that it would cost $1 billion to replace the entire fleet (replacing one every three years) and take 37 years.

That could only happen with the help of the federal government, he said.

“The Ferry Division collects $2 million in tolls each year,” he said, but they have said they need to collect $8 million yearly.

To get to that number, the Alliance has proposed that Hatteras be tolled at $10 each way, though the Senate has proposed $20 each way. Or, the Alliance said, $20 from Hatteras and free from Ocracoke.

They propose to increase the toll on the Pamlico Sound ferries to $20 each way, although the Senate has proposed $30 each way.

LeBlanc noted that the $15 one-way price currently on these two ferries hasn’t changed in decades.

North Carolina law says that if there’s a tolled road, there must be a free alternative. If all routes to Ocracoke are tolled, that violates this law, he said.

So, the alliance will propose that the law be changed to establish a free pass for permanent Ocracoke residents—one per registered vehicle/driver’s license with Ocracoke address on each.

As to how a toll at Hatteras would be collected, LeBlanc said the alliance favors a first-come, first-served EZ-Pass/Toll by License Plate to minimize overhead, while the reservation system for all other routes stays in place. To reduce infrastructure costs, he said one idea is the toll collecting may be only at the Hatteras terminal but for both trips, like the Mario Cuomo Bridge does in New York.

Additionally, the Alliance will ask the GA to appropriate $10 million out of Highway Trust Fund into the Ferry Replacement Fund for five years to bring the maintenance backlog to zero.

Finally, the alliance seeks to extricate ferry vessel replacement from State Transportation Improvement Program (STIP). This also would require state legislation. 

Bridge replacement is already exempted, LeBlanc said

“Aren’t ferries floating bridges?” he asked. A simple addition of “and ferry vessel” in two to three places in the STIP law would accomplish this.

The STIP divides the state into sections and gives each a pot of money from which to fund transportation projects over a 10-year period. NCDOT updates the STIP approximately every two years.

New ferries cost $25 to $34 million and would eat up a huge portion, if not all of, the funds allocated to each division. Hence, new ferries do not rank well as priority projects.

So, with more revenue from ferry tolls to fund replacement ferries and needed maintenance, this would enhance the visitor experience, which in turn leads to more ridership and more revenue all around, Chestnut said.

“With the money from the toll, the ferry becomes more sustainable,” he said. “The system is more sustainable. There are fewer breakdowns. We can actually increase ridership with tolls.”

There are a lot of issues surrounding tolls and their implementation, he said, but those details aren’t the focus just yet.

“The priority pass issue will be addressed later,” he said. “Right now, we want to make sure we have a ferry, not who gets on first.”

In addition to the items above, the alliance proposes the following budgetary changes to ferry operations:

1. Full funding for annual recurring budget of Ferry Division (operations and maintenance), $85.5 million for FY25/26 and a TBD amount for FY26/27  – plus needed increases due to oil prices from war with Iran.
2. Continued funding of non-recurring expenses (Total $69.3M in backlogged and deferred maintenance) until eliminated within 2 years, House Budget provides $46.5M, Senate Budget provides $44.5M for FY25/26 – leaving $22.8-$24.8M remaining for FY26/27.

During the Q&A session, some islanders expressed concern that the rapid rise in diesel fuel due to the Iran war would impact ferry service. LeBlanc said that this is not only a concern for the ferry system but pervasive throughout the state, noting that school districts are closely monitoring the costs of their vital school bus systems.

Brian Harris of Hatteras, who is with the Buxton Civic Association, told the group that he has been knocking on doors in Washington, DC, especially the Department of Interior and got doors open that had never been open before, leading to Buxton receiving $109 million for beach nourishment.

He said that he and LeBlanc went (to Washington) on Thursday where he introduced LeBlanc to his contacts in the Department of Interior.

“We had a presentation last week,” Harris said. “It was on preserving access to America’s first National Seashore, and it went very well. And that’s why I’m here, because we got to all get together. We need a seat at that table with the U.S. Fish and Wildlife Service and the National Park Service. I’m glad you guys are looking towards the tolls.”

As the meeting wound down, LeBlanc asked if anyone had concerns about the strategy of the alliance and all who spoke supported their efforts. Someone quipped, “Don’t let word get our that Ocracokers in a public meeting all agree on an issue.”