By SUZANNE DOWNING
April 6, 2026 -The Trump Administration has opened the door to hundreds of millions of dollars for ferry systems across the country, and Alaska is likely to be among the states lining up for a share. But securing the funds could require lawmakers in Juneau to set aside matching money in the state budget.
US Transportation Secretary Sean Duffy announced that the Federal Transit Administration will distribute $657 million through competitive ferry grant programs aimed at modernizing terminals, expanding routes, and funding new vessels. The funding is available to state ferry systems, local governments, and transit operators, with applications due May 11.
For Alaska, the opportunity is significant. The Alaska Marine Highway System is one of the largest public ferry systems in the United States and serves dozens of coastal communities that lack road access with its large network covering over 3,500 miles of coastline with about 11 vessels and 30+ communities. It has lower overall ridership than Washington state, which operates commuter-style ferries, and focuses more on remote, seasonal, or inter-island/coastal service rather than dense daily sailings.
The system has long struggled with aging vessels, deferred maintenance, limited service, and rising operating costs, all areas that align closely with the federal program’s priorities.
The grants are designed to fund new ferries, terminal upgrades, accessibility improvements, and route expansions. The US Department of Transportation also emphasized projects that improve access for families, increase safety and accessibility for passengers with disabilities, and provide better wayfinding and passenger information.
Those priorities match several needs within Alaska’s ferry network, including vessel replacement, terminal modernization, and improvements to passenger loading areas. Alaska has successfully competed for similar ferry grants in past years, often using federal funds to offset capital costs that would otherwise fall to the state.
However, most federal ferry grants require a state or local funding match, typically ranging from 10% to 20% depending on the program. That means the Alaska Department of Transportation and Public Facilities would likely need legislative approval to provide matching funds before submitting major applications.
With the application deadline set for May 11, the timeline intersects directly with the final weeks of Alaska’s legislative session, when lawmakers are negotiating the capital budget. If the state wants to compete for the full range of ferry funding, it may need to include match authority now rather than waiting until after awards are announced.
Failure to provide matching funds could limit Alaska to smaller projects or prevent the state from applying altogether.
The funding announcement also comes as Alaska continues to debate the future of the ferry system, including fleet replacement, service restoration to smaller communities, and long-term operating subsidies. Federal capital funding could help address infrastructure needs, but it would not cover operating costs.
Duffy said the program is intended to “expand routes and fund new ferries to give American workers and families more transportation options in both rural and urban cities,” emphasizing the role ferries play in connecting isolated communities.
In Alaska, where many coastal towns rely on ferries as part of the state highway system, the grants represent a potential boost — but only if Juneau sets aside the money needed to unlock them.
