Hawaii Superferry has agreed to pay the state at least $2.3 million a year for the right to operate in four Hawai'i harbors when it begins operations in April 2007. For its part, the state will provide $40 million in new harbor equipment that will be used primarily by Superferry vessels.

Those are among the key points in a memorandum of agreement that lays out the relationship between the government and what is expected to be the state's first major ferry service in nearly 30 years.

The 22-year agreement signed Sept. 7 provides the most detailed look yet at Hawaii Superferry plans and is meant to facilitate those plans while safeguarding state interests, officials said.

"It has been developed in a manner that allows the state to share in the rewards as the HSF (Hawaii Superferry) becomes more successful, but the agreement provides certain safeguards to limit the state's liability," state transportation director Rod Haraga said.

Under the financial terms of the agreement, Hawaii Superferry promises to pay the state $2 for every passenger, $4 for every private vehicle and $20 for every commercial vehicle it transports between the islands, or a minimum of $2.3 million per year in its first three years of operation. The company also will pay regular dockage fees charged to other commercial vessels.

"Based on our passenger projections, we expect to pay much more than the minimum every year," Hawaii Superferry executive John Garibaldi said last week.

The per-passenger fees will be included in the published fare the company will charge for passengers and vehicles, Garibaldi said. In earlier filings with the state Public Utilities Commission, the company has proposed charging a one-way walk-on passenger fare of $50. The company also plans to charge $55 to transport a passenger vehicle to Maui or Kaua'i from Honolulu and $90 for a pickup truck, van or limousine.

HARBOR UPGRADES

However, the state will not commit any of the $40 million until HSF receives its full funding commitment from the federal Maritime Administration, Haraga said.

The company hopes to close a deal on almost $200 million in private financing and federal loan guarantees this week and move ahead quickly with development plans, Garibaldi said.

The company plans to have its first vessel in Hawai'i by early 2007, put it through several months of sea trials and begin regular service between Honolulu and Maui and Kaua'i by April 2007. The start of service to Kawaihae on the Big Island has been delayed until at least 2009, when the state finishes harbor changes there and the company's second vessel is delivered to Hawai'i.

"This will change the way the whole state works," Garibaldi said. "It's going to break down a wall that exists now between the islands."

While the agreement provides a first glimpse at the ferry's proposed harbor operations, it does little to address concerns raised by several environmental and harbor user groups or discuss possible impacts outside the harbors. The groups are worried about the ferry's possible effects on migrating whales, the transmission of invasive species and conflicts with other harbor users.

Superferry officials say some of those concerns will be addressed in a more detailed operational plan the memorandum of agreement requires the company to file with the state Transportation Department next year. The plan is expected to include more details about vehicle and pedestrian traffic circulation, agriculture inspections, dealing with hazardous material and refuse removal. It also will outline transportation procedures, such as turning away dirty vehicles that could be carrying seeds of invasive species, Garibaldi said.

CHALLENGED IN COURT

Isaac Hall, attorney for the environmental groups that have filed two lawsuits in the case, said the state should have required the full operational plan before signing the memorandum of agreement with the ferry company.

"They've got everything backward," he said. "The law requires them to receive a detailed environmental review before giving the company any entitlements. Now they've already got the right to use the harbor without a plan."

One lawsuit in state court is under appeal; the second suit in federal court could be appealed later, Hall said.

The agreement sets out a process to address those concerns, Haraga said.

For example, he said Hawaii Superferry soon will provide the Transportation Department with draft operational plans that include a "proposed operational schedule, check-in and screening process, assembly process, loading and unloading process, provisioning and vessel services, maintenance, refuse removal, security plans, passenger assistance services, personnel plans, vehicle management plans and emergency plans."

Haraga said the department "intends to thoroughly review those plans, keeping in mind the concerns that have been raised to date, particularly those noted by harbor users, environmental groups and other parties."

The memorandum of agreement does not grant exclusive use of the new harbor facilities to the Superferry operations. It will require that any future ferry operations be allowed to share the facilities.

Ultimately, the state could force a Superferry vessel to vacate its dock if it is running significantly behind schedule, one of the problems that doomed Hawai'i's previous ferry service, SeaFlite, which operated in the Islands from 1975 to 1978.

Garibaldi said the 22-year agreement shows that Superferry is making a long-term commitment to continue operating in the state. The agreement helps assure the state receives a reasonable return on its harbor investments, he said.

HOW IT WILL WORK

In Honolulu, the new ferry operations will be based at Pier 19, where the state built a $5 million terminal in 2003. According to draft plans included in the agreement, the terminal will be used for ticket sales, customer processing, passenger and vehicle waiting, baggage and claim and other services.

Vehicles will enter the Pier 19 area from Nimitz Highway, undergo processing and be steered to a 24-lane auto staging area next to the docked ferry. There will be a separate entry area for passengers being picked up or dropped off at the terminal.

In other harbors, the state will allow Superferry to install and use its own equipment for passenger accommodations and security. The company could later be required to share its facilities with other ferry operators, according to the memorandum of agreement.

In Kahului, Maui, where the ferry operations have met stronger opposition from people concerned about congestion in the harbor and surrounding areas, the operations will be more complex than in other areas. Passengers and vehicles will wait to board the ferry in a terminal area near Wharf Street, almost a mile from the ferry docking area. A newly built curving road will be contraflowed to allow vehicles to exit and load on the ferry at the dock.

The agreement also could mark a watershed change in the way the state Transportation Department collects revenue from harbor users. Until now, the state has relied mostly on long-term leases of state property and wharfage fees to finance many harbor activities; the new proposal shifts the revenue stream to the day-to-day movement of people and cargo.

"To the extent that these types of agreements establish clearly defined roles and responsibilities for the state and harbor uses," it may have wide application in the future, Haraga said.