RALEIGH — More than a year after a new passenger ferry was supposed to be delivered to the state, the company building the boat says the N.C. Department of Transportation is to blame for it still not being finished.
NCDOT rejects that claim and says the company, US Workboats, has not provided information the U.S. Coast Guard needs to determine whether the boat is seaworthy. The Ocracoke Express, an aluminum-hulled catamaran capable of carrying 124 passengers, remains in the US Workboats yard in Hubert, near Swansboro.
The $4.15 million ferry was initially expected to begin service between Hatteras and Ocracoke last summer. After construction delays, NCDOT set a new due date of Aug. 6, 2018. When the boat was still not ready this spring, the state rented another catamaran, at a cost of about $1 million, to carry passengers between the two islands from late May until Labor Day.
In the meantime, NCDOT is assessing the company $1,000 for each day beyond the deadline that the boat is not finished — more than $400,000 so far.
The finger-pointing over why the boat is still not done surfaced in Wake County Superior Court this week, where US Workboats sued NCDOT claiming breach of contract. Steven Gibbons, an attorney for the company, told a judge that the state was trying to apply a higher standard of welding than was specified in the contract.
“The state is literally preventing completion of the contract by shifting back and forth between” the two welding standards, Gibbons said. He added that the boat is substantially finished, including repairs to welding problems uncovered earlier in construction.
“If you were to go out and look at it, you’d think it’s done. It looks really good,” Gibbons said. “But the welds that have been repaired .... have to be inspected, and they have to inspect it to the correct standard. And until that standard is declared, we’re stuck.”
Scott Slusser, representing NCDOT, countered that there should be no confusion about the welding standards that apply to the company’s work.
“This boat is 85 percent built,” Slusser said. “How did they build it 85 percent if they didn’t know what they were doing?”
Slusser said it appeared that by questioning the welding standards US Workboats ultimately wants to avoid some of the testing required to determine the welds are safe. He said some of the tests performed so far have uncovered “significant problems.”
“We’re talking about cracks and lack of fusion and voids in welds,” he said. “That doesn’t pass any standard.”
He said what’s holding up the completion of the Ocracoke Express is that US Workboats has not developed a weld testing program that meets U.S. Coast Guard approval.
“From NCDOT’s standpoint, this is going to be carrying 100 and some passengers for decades in shallow water at high speeds. Obviously there’s a safety concern there,” Slusser said. “And so they want a vessel — a $4 million vessel that they contracted for — to be fully sound and the welds to not have cracks.”
Wake County Superior Court Judge Vince Rozier dismissed the breach of contract claim, but not because he had determined US Workboats was wrong. Instead, Rozier agreed with the state that the company failed to follow a grievance process spelled out in its contract, which requires it to seek additional payments and other adjustments after the project is finished.
Rozier did not dismiss a part of the lawsuit in which US Workboats claims employees at NCDOT hurt the company’s reputation in talking to the press about the ferry’s welding problems. US Workboats plans to sue them as individuals, but doesn’t yet know who they are, Gibbons said, so they’re listed in the lawsuit as “John Doe” one through five.
Gibbons said someone from the state told the press at various times that all or a majority of the welds on the boat had failed and that the company “lacks the competency” to build it. He said the statements had prompted some employees to leave and caused the company to lose business.
“They had a very damning effect, a very damaging effect on the business,” Gibbons said. “Large contracts have been canceled because of those published statements. It’s a very big deal.”
Slusser said NCDOT can’t begin to defend against a defamation claim until it knows who is being sued.
The Ocracoke Express is designed to give visitors to Ocracoke an alternative to the car ferry from Hatteras Island. During the busy summer months, drivers often have to wait two to three hours for a spot on the car ferry.
The state expected to spend about $9.1 million on the project. In addition to the cost of the ferry itself, the state also built new parking in Hatteras and a dock and passenger shelter on Ocracoke.
The rented Ocracoke Express carried 28,604 passengers during its 15-week season this summer and got high marks in passenger surveys, said Tim Hass, spokesman for NCDOT’s Ferry Division.
“We are pleased and encouraged by the number of riders and the positive reviews we received this summer,” Hass wrote in an email.