Ocracoke Access Alliance proposes new tolling plan for Hatteras-Ocracoke ferry route

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The Ocracoke Access Alliance today released a comprehensive proposal to modernize and stabilize funding for North Carolina’s ferry system anchored by a balanced tolling structure for the Hatteras–Ocracoke route that protects resident access to North Carolina’s maritime highway while ensuring long-term system sustainability.

“The North Carolina Ferry System in desperate need of sustained investment,” said Justin LeBlanc, Alliance executive director.  “The reliability of maritime highway system is at stake.”

The proposal reflects months of engagement with state leaders, stakeholders, and ferry-dependent communities, and is designed to align operational funding, capital investment, and user-based revenue in a fair and predictable framework that will allow the ferry system to continue to support the state’s economy, jobs, and communities.

“At its core, this is about common sense and sustainability of a system the whole state depends on to grow its economy,” LeBlanc said. “We can protect access for Ocracoke residents and North Carolinians while ensuring the ferry system has the funding it needs to operate reliably and replace aging vessels.”

The Alliance emphasized that the proposal is designed to strike a careful balance: preserving the unique needs of Ocracoke residents, maintaining affordability for North Carolina travelers, and introducing reasonable user-based contributions to support long-term system viability.

“The ferry system is not just transportation—it is the lifeline of Ocracoke and a critical asset for the state,” said Bob Chestnut, an Alliance board member. “This proposal ensures that we treat the ferry system as the essential infrastructure that it is, with stable funding, smart policy and a fair approach to tolling.”

The Alliance sent the proposal to the members of the General Assembly, LeBlanc said, and will continue working with them, NCDOT, and the Governor’s office to advance these reforms during the current budget cycle.

The Alliance proposes the following key reforms:

1. Establish a practical toll for the Hatteras–Ocracoke Route:
   The Alliance recommends a $10 per-trip toll for the Hatteras route, indexed to inflation, maintaining affordability while achieving revenue goals. Alternatively, the state could adopt a $20 one-way toll departing Hatteras with a no-toll return trip—simplifying administration while preserving access.

2. New tolls for mainland routes:
   Mainland ferry routes should adopt a standardized toll of $20 each way, also indexed to inflation over time. This represents an affordable alternative to higher toll levels proposed in the Senate budget that still generates necessary revenue.

3. Toll waiver for verified permanent residents:
   To protect essential access and recognize Ocracoke residents’ existing contributions to state highway funds, the Alliance proposes codifying a toll waiver for full-time Ocracoke residents, limited to one per registered vehicle and driver’s license with matching Ocracoke addresses.

4. Streamline reservations and operations:
   The Alliance recommends maintaining reservations for longer mainland routes, while preserving the Hatteras–Ocracoke route as a first-come, first-served system. Implementation of EZ-Pass or Toll-by-License-Plate technology would minimize administrative overhead and improve throughput.

5. Fully fund ferry operations (O&M):
   The Alliance calls for full funding of the Ferry Division’s recurring operations and maintenance budget—$85.5 million for FY 2025–26 and the amount requested by the Ferry Division for FY 2026–27—while accounting for upward pressure from rising costs, including fuel prices.

6.  Eliminate deferred maintenance within two years:
   With total backlogged and deferred maintenance estimated at $69.3 millionA, the Alliance supports continued non-recurring appropriations to eliminate this backlog within two fiscal years. Current House and Senate proposals would leave roughly $22.8–$24.8 million remaining for FY 2026–27, which should be fully addressed.

7. Dedicate capital funding for ferry infrastructure:
   The proposal supports setting aside $10 million annually from the Highway Trust Fund into the Ferry Capital Fund for at least five years, ensuring a stable pipeline for vessel replacement and infrastructure upgrades. The existing ferry fleet has an average age of 26 years, with one vessel already 55 years old.  This aging fleet risks deeper disruptions to reliability.  

8. Reform the STI process for vessel replacement:
   Ferry vessel replacement should be removed from the State Transportation Improvement (STI) process, where it currently competes poorly against highway projects as evidenced by the fact that North Carolina has not awarded a ferry contract to modernize its ageing ferry fleet in the last 8 years. A simple legislative fix—adding “and ferry vessel” alongside existing bridge replacement exemptions—would provide a durable solution.

9. Reinvest proceeds from vessel sales:
   Revenue generated from the sale of retired vessels should be directed into a dedicated Ferry Vessel Replacement Fund, creating a self-reinforcing capital cycle.
10. Modernize the “commuter pass”: The current commuter pass should be renamed an “annual pass” as no one commutes to/from Ocracoke.  It is available to all North Carolina residents.