State on hook for ferry depreciation

SEATTLE – Washington state may have to pay millions of dollars to two companies that own the depreciation rights on four ferries the state plans to scrap.

From 1983 to 1995, the state received money from three private corporations for the transfer of tax benefits on nine ferries, including four Steel Electric-class boats that were pulled from service on Nov. 20 because of concerns about corrosion.

Washington State Ferries received $9.7 million when it sold the tax deductions on the Steel Electrics to Meijer Inc., of Grand Rapids, Mich., a large retail company, and to Haven Leasing, an Illinois company.

At the time, the state committed to operating the ferry Klickitat until 2010 and the Nisqually, Quinault and Illahee until 2014.

But now the ferries are being retired sooner than expected, so the ferry service says it may owe $2.73 million to Meijer and Haven Leasing.