ALASKA MARINE HIGHWAY FUND
Annual Financial Report For the fiscal year ended June 30, 2017
2017
Alaska Marine Highway System Fund
ANNUAL FINANCIAL REPORT For the fiscal year ended June 30, 2017
Prepared by: Alaska Marine Highway System, Department of Transportation and Public Facilities
TABLE OF CONTENTS Alaska Marine Highway System Annual Financial Report
For the Fiscal Year Ended June 30, 2017
page
INTRODUCTORY SECTION
1
Letter of Transmittal
2
Marine Transportation Advisory Board
3
Ports of Call
4
Profile of the Fleet
5
Vessel Information
6
FY 2017 Operating Plan
7
Operating Revenue Chart
8
Operating Expenditures Chart
9
FINANCIAL SECTION
11
Statement of Revenues, Expenditures, and Changes in Fund Balance
12
Statement of Actual and Estimated Revenues from Operations
13
Notes to the Financial Statement
14
STATISTICAL SECTION
15
Operating Revenues by Vessel FY 2006 - FY 2017
16
Operating Expenditures by Vessel FY 2006 - FY 2017
17
INTRODUCTORY SECTION
I
1
LETTER OF TRANSMITTAL
‡’ƒ”–Â?‡Â?– ‘ˆ ”ƒÂ?•’‘”–ƒ–‹‘Â? ƒÂ?† —„Ž‹… ƒ…‹Ž‹–‹‡• ƒ”… —‹Â?‡Â?ÇĄ ‘Â?Â?‹••‹‘Â?‡” 3132 Channel Drive P.O. Box 112500 Juneau, Alaska 99811-2500 Main: 907.465.3900 dot.state.ak.us
December 22, 2017 Dear Alaska State Legislator: Enclosed is the Alaska Marine Highway System (AMHS) Annual Financial Report for Fiscal Year 2017 (ended June 30, 2017) as required by AS 19.65.070. During FY2017, the AMHS recorded $45.8 million in operating revenues which was down from previous years. A portion of this decrease in revenue was expected due to service reductions as a result of the AMHS budget being cut in FY2017. Additionally, late deliveries of the M/V Columbia and the M/V Tustumena, as well as vessel breakdowns contributed to lower revenue. The planned and unplanned reductions in service along with improved efficiencies and reduced fuel costs resulted in a total operating expenditure of $134.9 million, $10.3 million less than FY2016 and $25.9 million less than FY2015. AMHS operated with an on-time departure rate of 93 percent. Port calls decreased during FY2017, down from 6,504 in FY2016 to 5,767. Service weeks provided by the AMHS decreased to 329.5, down from the previous year’s 355.9. As with the revenues, these decreases were primarily due to the budget cuts and the late deliveries of the Columbia and Tustumena. The Alaska Marine Highway System is meeting the challenge of providing safe, efficient, reliable, and cost effective transportation for the traveling public. The system’s customer satisfaction rating remains strong at 94 percent. I look forward to the opportunity to share more AMHS successes with you in the coming year. Sincerely,
Marc Luiken Commissioner
“Keep Alaska Moving through service and infrastructure.�
2
MARINE TRANSPORTATION ADVISORY BOARD Alaska Marine Highway System Marine Transportation Advisory Board Originally created under Administrative Order 204, a temporary interim Marine Transportation Advisory Board (MTAB) was established by Governor Murkowski on January 15, 2003. Administrative Order 233, signed by Governor Palin and dated March 28, 2007, permanently established the MTAB which was subsequently established in Alaska Statute by House Bill 294 on June 4, 2008. This bill established the Alaska Marine Transportation Advisory Board and set out its powers and duties in Alaska Statute AS 19.65.011 and AS 19.65.110-195, made conforming amendments, and provided an effective date of June 5, 2008. The board was expanded by one seat (from 11 members to 12) with the addition of a representative from the Southwest System under Senate Bill 24 effective September 1, 2013. The following are the MTAB Members as of June 30th, 2017:
CHAIRMAN Robert Venables
MEMBERS Patricia Branson
Northern Southeast Alaska (Haines, Juneau, Skagway)
South Central Alaska
DOT&PF STAFF SUPPORT Captain John Falvey
Shannon Adamson
Labor Unions of the employees of the AMHS
General Manager
Gerald Hope
Shannon Whistler
Central Southeast (Petersburg, Sitka, Wrangell)
Administrative Assistant II
David Reggiani
Prince William Sound / Kenai Peninsula (Cordova, Valdez, Whittier, Yakutat, Chenega Bay, Tatitlek)
Daniel Kelly
Business owner with experience interacting with AMHS - Resident of Ketchikan Gateway Borough
Patty Mackey
Travel Agent / Tourism Specialist
Jack Jensen
Marine Captain / Engineer
Carlin Enlow
Southwest Alaska / Aleutian Chain / Alaska Peninsula (Akutan, Chignik, Cold Bay, False Pass, Homer, King Cove, Kodiak, Port Lions, Sand Point, Seldovia, Unalaska / Dutch Harbor)
Robert Arnold
Member At-Large
Maxine Thompson
Southeast Alaska (Angoon, Hoonah, Kake, Pelican, Tenakee)
Greg Wakefield
Member At-Large / Not directly served by AMHS
3
PORTS OF CALL Alaska Marine Highway System Ports of Call
SOUTHEAST ALASKA
SOUTHWEST ALASKA
Angoon
Akutan
Bellingham, WA
Chenega Bay
Gustavus
Chignik
Haines
Cold Bay
Hoonah
Cordova
Juneau (Auke Bay)
False Pass
Kake
Homer
Ketchikan
King Cove
Metlakatla (Annette Bay)
Kodiak
Pelican
Old Harbor
Petersburg
Ouzinkie
Prince Rupert, BC, Canada
Port Lions
Sitka
Sand Point
Skagway
Seldovia
Tenakee Springs
Tatitlek
Wrangell
Unalaska / Dutch Harbor
Yakutat
Valdez Whittier
4
PROFILE OF THE FLEET Alaska Marine Highway System Profile of the Fleet
M/V Matanuska 408 feet Built 1963
M/V Malaspina 408 feet Built 1963
M/V Taku 352 feet Built 1963 M/V Tustumena 296 feet Built 1964
M/V Lituya 181 feet Built 2004
M/V Columbia 418 feet Built 1974 M/V Aurora 235 feet Built 1977
M/V LeConte 235 feet Built 1974
M/V Kennicott 382 feet Built 1998
FVF Chenega 235 feet Built 2005
FVF Fairweather 235 feet Built 2004
5
9,214 3,824
3,029 1,235 7,200 16.50 234 48 499 450
5 21 79 0 1 106 243 1,960 83 1,675 10
Domestic Tonnage Gross: Net:
hp @ Service Speed Service Speed (kts) Fuel Use (gph) Crew Capacity: COI Passenger Capacity: COI Passenger Capacity: Booking
Staterooms 4 berth 3 berth 2 berth 4 berth ADA 2 berth ADA Total Staterooms Total Berths
Vehicle Capacity (lane-ft.) Quantity (20 foot vehicles) Vehicle Capacity: Booking Van Capacity: Booking
Matanuska 1963 408 74 5,569 16-11 5/8
International Tonnage Gross: Net:
Year Built Length (ft) Beam (ft) Displacement (L/T) Loaded Draft (ft-in)
6 1,960 83 1,675 10
45 0 26 0 1 72 234
8,000 16.50 270 47 499 450
2,928 1,253
9,121 3,667
Malaspina 1963 408 74 5,994 16-10
1,500 75 1,000 5
6 0 32 0 2 40 92
8,000 16.50 253 44 370 350
2,625 1,494
7,302 2,496
Taku 1963 352 74 4,319 17
852 34 680 6
6 0 17 0 1 24 60
5,100 13.30 151 38 174 160
2,174 898
4,529 1,451
Tustumena 1964 296 59 3,067 14-4 1/2
3,200 133 2,660 16
45 0 56 0 3 104 298
14,000 17.30 397 63 600 499
3,946 2,683
13,009 4,932
Columbia 1974 418 85 7,684 17-6 1/8
720 33 660 8
0 0 0 0 0 0 0
4,300 14.50 188 24 247 225
1,328 566
3,124 987
LeConte 1974 235 57 2,132 13-8
Alaska Marine Highway System Vessel Information Table
720 33 660 7
0 0 0 0 0 0 0
4,300 14.50 190 24 300 250
1,280 453
3,124 987
Aurora 1977 235 57 2,132 13-8
1,700 78 1,560 17
48 0 58 3 0 109 320
13,200 16.75 354 55 499 450
9,978 7,354
12,635 3,790
Kennicott 1998 382 85 7,503 17-6
360 15 300 2
0 0 0 0 0 0 0
2,000 11.50 55 5 149 125
97 66
758 227
Lituya 2004 181 50 647 12
720 31 620 3
0 0 0 0 0 0 0
19,310 32.00 600 10 250 210
1,280 870
3,424 1,027
Fairweather 2004 235 60 787 8-6
720 31 620 3
0 0 0 0 0 0 0
19,310 32.00 600 10 250 210
1,333 827
3,420 1,026
Chenega 2005 235 60 787 8-6
VESSEL INFORMATION TABLE
7
Jul 1 BEL
Jul 1 YPR - SGY
Jul 1 CIP
Jul 1 LU
Jul 1 MET
Jul 1 NP
Jul 1 SW
Jul 1 PWS
Jul 1 NLC
Jul 1 CIP
COL
MAT
MAL
TAK
LIT
LEC
TUS
AUR
FWX
CHE
COI
In Transit (IT)
CIP
Layup (LU)
Sep 19 OH
Oct 3 OH
Sep 26 Repairs
Oct 5 BEL
OCT
Oct 06 LU
Sep 12 IT Sep 15 PWS 4X / week
SEP
MET: Metlakatla Service
Mar 01 OH
Mar 04 LU
Mar 13 OH
YPR-SGY: Prince Rupert to Skagway
YPR-JNU: Prince Rupert to Juneau
NLC: North Lynn Canal Dayboat
NP: Northern Panhandle Dayboat
Jan 21 IT Jan 28 OH
Jan 20 IT Jan 22 PWS
PWS: Prince William Sound
SW: Southwest
Jan 26 MET
APR MAY
JUN
Total Operating Weeks
Southwest Vessels
Feeder Vessels
Mainline Vessels
May 25 NLC 3x / week SIT 1x / week
Mar 23 COI Mar 30 BEL - X - GULF
MAR
Feb 20 YPR - SGY
Feb 15 COI
FEB
Jan 14 COI Jan20 20NP IT Jan
Jan 10 OH
Note: Dates represent the ďŹ rst day of the period. Overhaul and refurbishment periods include vessel travel time.
SIT or PSG : Sitka or Petersburg Service
Jan 3 OH
Jan 11 OH
JAN
Jan 06 COI Jan 11 BEL
Nov 29 OH
DEC
Nov 23 COI Nov 29 NP
Nov 13 LU
NOV
BEL - X - Gulf: Bellingham Cross Gulf Southwest
BEL: Bellingham to Skagway
AUG
Overhaul (OH)
On Line
Jul 1 BEL - X- GULF
KEN
JUL
Alaska Marine Highway System FY 2017 Operating Plan
Operating Weeks
329.5
78.1
128.6
122.8
0.0
34.0
41.7
36.4
44.7
49.9
0.0
24.4
45.3
12.4
40.7
FY 2017 OPERATING PLAN
OPERATING REVENUES
Alaska Marine Highway System Fund
Alaska Marine Highway System Fund UNRESTRICTED OPERATING REVENUES Unrestricted Operating Revenues
the fiscal endedJune June 30, For theFor fiscal yearyear ended 30,2017 2017 $45.8 Million $45.8 MILLION
Ticket Sales
82.8%
Stateroom Sales
10.2%
Passenger Services Sales
6.9%
Other Unrestricted Revenue
0.2%
8
OPERATING EXPENDITURES
Alaska Marine Highway System Fund
OPERATING EXPENDITURES For the fiscal year ended June 30, 2017
$134.9 MILLION
Marine Vessel Operations
73.4%
Operations Management
2.8%
Marine Fuel
11.3%
Overhaul
1.2%
Shore Operations
5.6%
Marine Engineering
2.0%
Reservations and Marketing
1.2%
Support Services
2.4%
9
10
FINANCIAL SECTION
F
11
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE Alaska Marine Highway System Fund Statement of Revenues, Expenditures and Changes in Fund Balance For the Fiscal Year Ended June 30, 2017 (In Thousands)
Revenues: Unrestricted Revenues: Ticket Sales Stateroom Sales Passenger Services Sales Facility Rental Concession Fees Other Unrestricted Revenue Total Unrestricted Revenues
Capitalization
AMHS
$
- $ -
37,878 $ 4,649 3,158 7 7 61 45,759
37,878 4,649 3,158 7 7 61 45,759
-
55 604 46,418
55 604 46,418
-
3,281 2,680 1,569 3,836 1,663 7,572 15,299 98,974 55 134,930
3,281 2,680 1,569 3,836 1,663 7,572 15,299 98,974 55 134,930
2,630 -
(88,512) 18,445 89,263 9,465
(88,512) 21,075 89,263 9,465
2,630 $
28,661 $
31,291
Restricted Revenues Indirect Cost Recovery Total Revenues Expenditures: Current Operating: Support Services Marine Engineering Overhaul Operations Management Reservations & Marketing Shore Operations Marine Fuel Marine Vessel Operations AMHS RSA Total Expenditures Excess (Deficiency) of Revenues and Other Financing Sources Financing Uses from Operating Fund Balance, Beginning of Year Reserves and Year End Adjustments Fund Transfer - General Fund Transfer from Community Quota Entity RLF Fund Balance, End of Year; Undesignated
$
The notes to the financial statement are an integral part of this statement.
12
Total
STATEMENT OF ACTUAL AND ESTIMATED REVENUES Alaska Marine Highway System Fund Statement of Actual and Estimated Revenues Budgetary Basis (In Thousands)
Fiscal Year Ended June 30, 2017
Restricted Restricted Revenues Indirect Cost Recovery (ICAP) Total Restricted Unrestriced AMHS Fund Ticket Sales Stateroom Sales Passenger Service Sales Facility Rental Concession Fees Other Unrestricted Revenue Total Unrestricted Total Revenues
Estimated Revenues
Actual Revenues
$
$
55 1,450 1,505
55 604 659
Fiscal Year Ending June 30, 2018 Actual Over (Under) Estimated $
0 (846) (846)
Total Estimated Revenues $
300 1,250 1,550
Fiscal Year Ending June 30, 2019
Estimated Revenues 12/31/2017 $
0 0 0
Estimated Revenues $
200 1,653 1,853
43,845 4,091 5,611 4 10 65 53,626
37,878 4,649 3,158 7 7 60 45,759
(5,967) 558 (2,453) 3 (3) (5) (7,867)
42,596 5,228 3,551 15 10 10 51,410
22,012 2,702 1,835 8 3 0 26,560
42,999 5,278 3,585 4 10 10 51,886
$ 55,131
$ 46,418
(8,713)
$ 52,960
$ 26,560
$ 53,739
The notes to the financial statement are an integral part of this statement. Budgetary Presentation shows all budgeted and actual revenues including budgeted intergovernmental activitiy.
13
NOTES TO THE FINANCIAL STATEMENT Alaska Marine Highway System Fund Notes to the Financial Statement For the Fiscal Year Ended June 30, 2017
NOTE 1 -
Alaska Marine Highway System Fund The Alaska Marine Highway System Fund was established July 1, 1990. All gross revenues generated from the operation of the Alaska Marine Highway System are accounted for and remitted in accordance with AS 19.65.070 which mandates that the money shall be deposited in the Alaska Marine Highway System Fund. Marine Highway Capitalization Account The Marine Highway Capitalization account was established within the Alaska Marine Highway System Fund June 30, 2009. An estimated $9 million in general funds was reappropriated to the new Capitalization Account. Access to this new funding will be restricted and will only occur with approval by the Legislative Budget and Audit Committee. An unexpended and unobligated balance of funds for the off-set of higher fuel costs, estimated at $1.25 million, were reallocated in Chapter 13, SLA 10, Sec 11(c) to the Marine Highway Capitalization Account. In FY2012 and FY2013, a total of $6.55 million of unexpended and unobligated balance of funds for the off-set of higher fuel costs were reallocated to the Marine Highway Capitalization Account. In FY2014, $11.0 million of funds were transferred to the AMHS FY2015 Capital Fund for vessel overhaul projects and $3.0 million in funds were transferred to the AMHS Deferred Maintenance capital fund.
NOTE 2 -
CIP Program Component The Alaska Marine Highway System budget includes a component which authorizes positions directly related to capital projects. Beginning in FY2001, the salary cost of time charged directly to capital projects is not recorded in the Alaska Marine Highway Fund. The cost of time charged to administration or overhead is recorded in the Alaska Marine Highway Fund.
NOTE 3 -
Transfer from Community Quota Entity RLF In FY2017, the Legislature appropriated $9.4 million of the unexpended and unobligated balance from the Community Quota Entity RLF to the Marine Highway Fund. These funds were put into the Marine Highway Fund at the end of FY2017. The authority to use these funds is part of the Marine Highway System's FY2018 operating budget. (CCS HB57 Sec. 40(d)).
NOTE 4 -
Operating Overhaul Overhaul expenditures that are included in the Operating Budget are limited to small maintenance items that arise while the vessels are operating and do not include capital overhaul expenditures. Large vessel overhaul and deferred maintenance items are included in the Capital Budget. In FY2017, the Vessel Overhaul and Deferred Maintenance Capital Budgets totalled $12.5 million.
14
STATISTICAL SECTION
S
15
VESSEL Aurora Chenega Columbia Fairweather Kennicott Leconte Lituya Malaspina Matanuska Taku Tustumena Contract Vessels Non Vessel Revenue TOTAL
16
FY07 2,003 1,963 12,439 2,913 5,831 916 593 7,552 8,146 2,833 3,060 127 32 48,407
FY08 1,347 3,093 6,463 2,605 3,414 1,514 721 11,659 8,841 4,480 3,376 135 47,647
FY09 2,191 3,380 9,713 1,015 5,182 1,808 639 10,980 3,094 5,156 2,992 2 46 46,200
FY10 3,115 1,392 7,924 1,945 3,125 1,757 620 11,446 6,211 4,755 3,525 54 46 45,914
FY11 2,522 3,428 8,939 1,805 7,154 794 724 10,520 6,100 2,265 3,318 39 89 47,697
FY12 1,898 2,889 13,014 1,659 8,151 2,537 822 5,765 9,003 4,001 3,755 12 180 53,684
FY13 2,679 2,221 16,635 1,537 9,195 2,006 774 3,133 9,217 3,839 1,875 2 121 53,234
FY14 2,421 2,358 6,682 1,415 8,425 2,499 769 12,051 7,154 4,789 2,106 207 50,877
FY15 4,059 1,914 11,778 1,684 8,265 854 848 11,036 3,989 5,474 3,828 167 53,896
FY16 FY17 2,721 3,228 675 7,471 5,500 2,049 2,418 7,705 11,198 3,634 4,015 812 1,117 11,316 7,481 7,192 7,863 3,566 2,865 16 74 47,157 45,759
*These figures are close approximations based on reservations and ticketing information. They may be used to show relative magnitude of different vessel operations. They are not accounting figures. Therefore, attempts to reconcile the figures with accounting documents may yield small discrepancies.
FY06 2,327 1,128 15,530 2,257 6,209 1,638 593 7,832 7,418 3,292 2,849 76 53 51,202
Alaska Marine Highway System Unrestricted Revenue by Vessel* Fiscal Years 2006 - 2017 (In Thousands)
OPERATING REVENUES BY VESSEL
VESSEL Aurora Chenega Columbia Fairweather Kennicott LeConte Lituya Malaspina Matanuska Taku Tustumena Vessel Leave All Vessels TOTAL
17
FY07 6,264 6,360 16,735 7,762 16,300 5,485 1,008 9,089 14,814 9,452 8,744 14,576 11,024 127,613
FY08 3,649 8,845 8,892 8,154 11,853 7,141 1,170 14,664 14,160 13,745 9,612 15,164 9,709 126,757
FY09 7,649 9,474 11,231 4,949 15,091 6,912 1,189 14,065 7,260 13,583 6,642 14,268 12,231 124,542
FY10 7,720 4,643 9,587 7,356 10,557 7,070 1,114 14,558 12,611 13,458 9,114 14,375 10,240 122,404
FY11 8,065 10,146 11,861 7,824 18,022 4,858 1,415 16,147 16,246 8,853 10,068 15,949 10,379 139,834
FY12 5,380 8,513 17,292 9,539 17,341 9,807 1,381 11,843 17,390 15,880 10,978 16,605 9,591 151,540
FY13 8,104 8,098 20,380 7,774 21,170 9,533 1,367 8,573 17,669 16,020 6,527 16,695 10,178 152,087
FY14 7,013 7,971 9,706 6,586 16,468 9,915 1,195 16,929 14,644 17,810 9,966 17,234 9,725 145,162
FY15 6,446 6,595 15,757 7,739 15,031 6,677 1,224 15,313 10,683 16,768 10,569 9,006 18,298 140,106
FY16 6,264 3,899 14,312 6,894 17,074 9,087 963 14,794 17,078 3,414 10,884 13,339 7,145 125,147
FY17 7,051 878 13,297 8,248 18,121 9,511 1,065 8,215 15,909 1,261 10,644 13,350 8,347 115,897
Service Agreements (RSA). Not included are the budget components for Marine Engineering, Operations Management, Reservations and Marketing, and Shore Operations.
* Expenditures by vessel include the following operating components: Marine Vessel Operations, Overhaul, Fuel and unbudgeted AMHS Reimbursable.
FY06 6,434 7,778 17,205 5,887 15,624 8,129 961 9,219 11,456 9,436 6,378 11,571 10,123 120,201
Alaska Marine Highway System Operating Expenditures by Vessel* Fiscal Years 2006 - 2017 (In Thousands)
OPERATING EXPENDITURES BY VESSEL
Alaska Marine Highway System Fund
FY 2017 ANNUAL FINANCIAL REPORT State of Alaska, Department of Transportation and Public Facilities
Compiled December 15th, 2017