Ferry Programs in the Department of Transportation

Ferry Programs in the Department of Transportation

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Updated January 27, 2022
Ferry Programs in the Department of Transportation
Ferries provide transportation services in a wide variety of
Table 1. Top 10 States for Ferry Passenger and
settings and for many purposes. The main types of ferry
Vehicle Boardings, 2017
service in the United States are commuter passenger service
in urban areas, and highway vehicle carriage in rural areas
Passengers
Vehicles

where a bridge is unavailable. Coastal and island regions,
NY
28,348,259
WA
11,488,050
such as Alaska, the U.S. Virgin Islands, Puget Sound, and

New England, can be especially dependent on ferries for
WA
27,493,805
NY
2,164,453

both passenger and freight transportation. There are also
CA
15,657,080
LA
2,021,741
many ferries that provide service mainly for recreational

purposes, including several in national parks. Overall,
MA
7,784,885
TX
1,778,178

ferries play a minor role in the U.S. transportation system,
NJ
6,494,024
MI
1,082,962
providing about 1% of public transportation trips in 2019.

TX
5,449,355
VA
956,720

The U.S. Department of Transportation (DOT) supports
ferry services through both highway and public
LA
3,949,472
MA
876,154

transportation programs. Generally, federal funds are
GA
3,857,943
IL
828,052
eligible for capital projects, including buying and

refurbishing ferries, and building and rehabilitating ferry
IL
3,388,347
NC
703,247

terminals and maintenance facilities. Ferries must be built
VA
2,499,787
CA
505,158
domestically according to a law dating to 1886 (46 U.S.C.

§55103). In certain circumstances, federal funds may be
U.S., Total
126,239,031
U.S., Total 27,010,994
used for operating expenses. The programs discussed here
Source: Bureau of Transportation Statistics, National Census of
are intended for permanent ferry operations. Temporary
Ferry Operators, 2018.
ferry operations may be eligible under other programs, such
as DOT’s highway and public transportation Emergency
Infrastructure Investment and Jobs Act
Relief programs.
The Infrastructure Investment and Jobs Act (IIJA; P.L. 117-
Ferry Systems
58) authorized and appropriated funding for surface
transportation programs for FY2022-FY2026. The act funds
According to the Bureau of Transportation Statistics,
ferries through both dedicated programs and broader
ferries, prior to the Coronavirus Disease 2019 (COVID-19)
highway and public transportation programs. The IIJA more
pandemic, annually served about 126 million passengers
than tripled annual dedicated ferry funding compared with
and 27 million vehicles. Three states—New York,
the previous authorization act (unadjusted for inflation).
Washington, and California—accounted for more than half
The IIJA provided $2.3 billion specifically for ferries,
of ferry passenger boardings, and the state of Washington
comprising $0.7 billion in contract authority from the
alone accounted for more than 40% of vehicle boardings
Highway Trust Fund and $1.6 billion in general fund
(Table 1).
appropriations. The bill also authorized another $1.3 billion
specifically for ferries from the general fund, subject to
Ferry operators, reporting one or more reasons for
future appropriations (Figure 1).
providing service, listed commuter transit most often (67%
of operators), followed by transportation for
Figure 1. Dedicated Ferry Funding in the IIJA
pleasure/recreation (65%), roadway connections (29%),
FY2022-FY2026
emergency services (27%), island access to mainland
(23%), and national park access (23%).
Both public and private entities operate ferry service, but
the public/private distinction can be complicated. About
40% of ferry operators are public agencies, and about the
same share of vessels is owned publicly. A larger
proportion of ferry terminals, about 70%, is publicly
owned, indicating that many public terminals serve
privately owned ferry operators and vessels. Furthermore,
publicly owned vessels and terminals are sometimes run
privately. In a few cases, privately owned vessels and
terminals are run publicly.

Source: Infrastructure Investment and Jobs Act (P.L. 117-58).
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Ferry Programs in the Department of Transportation
Federal-Aid Highway Funding
 Ferry Service for Rural Communities. This program
Several programs administered by the Federal Highway
provides funding for scheduled ferry service serving at
Administration (FHWA) can be used for ferries. Funding is
least two rural areas more than 50 miles apart. The IIJA
generally available to construct ferry boats, ferry terminals,
appropriated $200 million per year, a total of $1 billion,
and ferry maintenance facilities. Both passenger and vehicle
from the general fund. The IIJA also authorized another
ferries are eligible for support if service is on a fixed route
$200 million per year from the general fund, subject to
in a situation where it is not feasible to build a bridge or
appropriations.
tunnel.
Multi-Modal Funding
Dedicated ferry funding is authorized from the Highway
Ferry projects are also eligible for funding from the
Trust Fund for FHWA’s Ferry Boat Program. Funding for
competitive multi-modal Rebuilding American
this program in the IIJA totaled $912 million, an average of
Infrastructure with Sustainability and Equity (RAISE)
$182 million per year. Funding is distributed by formula
grants program, administered by DOT. For example, a
(23 U.S.C. §147). The IIJA added operating costs as
transit agency in New Orleans was awarded a $10 million
eligible expenses. The maximum federal share for funds
grant in 2015 to replace a ferry terminal on the Mississippi
made available to states is 80%.
River. The IIJA appropriated $1.5 billion per year from the
general fund for RAISE grants, a total of $7.5 billion.
States may also use funds distributed by formula from the
Surface Transportation Block Grant Program and the
Issues for Congress
National Highway Performance Program. The IIJA
The COVID-19 pandemic is an issue for ferry
authorized new formula and competitive grant programs for
transportation. An unprecedented reduction in travel
which ferries are eligible. For example, projects to make
beginning in March 2020 had a dramatic effect on the
ferry service more resilient to disruptions from sea level
budgets of ferry operators that Congress addressed to some
rise, weather events, and other natural disasters are eligible
extent through supplemental appropriations to transit
for funding under the new Promoting Resilient Operations
agencies and state DOTs. Ferry operators have also had to
for Transformative, Efficient, and Cost-saving
contend with increased costs associated with the pandemic,
Transportation (PROTECT) program.
such as extra cleaning costs, and workforce issues related to
illness and resignations. The longer-term effects of the
Federal Public Transportation Funding
health crisis on ferry service and use are uncertain.
Support from the Federal Transit Administration (FTA) is
available for ferries in urban and rural areas that provide
Although IIJA more than tripled annual dedicated ferry
regular and continuing shared-ride service for pedestrians,
funding, the amount of money available is likely to be an
although these ferries may also accommodate vehicles.
ongoing issue, one that Congress could address in annual
Funding can be used to construct and refurbish ferries, ferry
appropriations legislation or in a future authorization.
terminals, and maintenance facilities. Transit agencies in
Existing ferry systems face challenges with funding due to
smaller urbanized areas and rural areas, as well as small
the age and relatively poor condition of ferries and ferry
agencies in larger urbanized areas, can expend federal funds
terminals. The U.S. Army Corps of Engineers reported that
on operating expenses.
the average age of the ferry fleet was 33 years in 2020. The
effects of climate change may also raise ferry operators’
Dedicated public transportation ferry funding is available
costs, as rising sea levels and more frequent storm damage
through the competitive Ferry Boat Discretionary Program
may require reconstruction of ferry terminals. The desire to
(49 U.S.C. §5307(h)). The program was authorized at $30
replace conventionally powered ferries with electric and
million per year from the Highway Trust Fund, a total of
other alternatively powered ferries along with the
$150 million over the life of the IIJA. Funds are set aside
supporting infrastructure also may raise costs.
from FTA’s Urbanized Area Formula Program and, as such,
are limited to ferry services in urbanized areas (places of
Ferry service is predominantly provided in urban areas, and
50,000 or more people). The maximum federal share is
these areas may have more flexibility to direct transit
80%. Ferries are also an eligible use of broader transit
funding to ferries. Nevertheless, most of the increase in
funding distributed to transit agencies by formula, and for
dedicated ferry funding in the IIJA was for a new FTA rural
FTA’s Capital Investment Grant Program, a competitive
ferry program such that dedicated ferry funding provided by
program that supports the building of major new transit
FTA for rural areas is now much larger than that dedicated
systems and extensions to existing systems.
for urban areas.
The IIJA created two new ferry programs administered by
The IIJA makes privately owned ferries and terminals
FTA:
eligible for highway funding in certain circumstances.
Some ferry projects remain ineligible for federal funding.
 Electric or Low-Emitting Ferry Pilot Program. This
Routine maintenance of ferries and ferry terminals is not
program provides funding for the purchase of electric or
eligible for assistance under most federal programs, and
low-emitting ferries or the modification of existing
some programs will not support operational expenses.
ferries. The IIJA appropriated $50 million per year, a
total of $250 million, from the general fund. The IIJA
William J. Mallett, Specialist in Transportation Policy
also authorized another $50 million per year from the
general fund, subject to appropriations.
IF12027
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Ferry Programs in the Department of Transportation

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