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Superferry files for bankruptcy
By Mark Niesse - Associated Press
HONOLULU — The Hawai‘i Superferry is filing for bankruptcy, two months after a state Supreme Court ruling effectively shut it down.
The Hawai‘i Superferry, the only passenger ship connecting the islands, said in a statement that the expenses of maintaining its two vessels have weighed down the company because it doesn’t have any revenues.
The ferry service sought charter opportunities around the world, but those efforts haven’t produced results in time for the company to meet its financial obligations.
“Our efforts to refinance and restructure the company for this interim period with additional investment have not been successful, as yet. Accordingly, a filing of Chapter 11 was an unavoidable next step,” the Superferry said in its statement Saturday.
The Hawai‘i Supreme Court ruled March 16 that a state law allowing the company to operate while an environmental study was being conducted was unconstitutional.
Legislators crafted that law after the court ruled in 2007 the state would need to finish an environmental study before the ferry could begin service.
Environmentalists claimed in their lawsuit the ferry would strike whales, increase traffic and facilitate the movement of invasive species.
The Superferry’s first vessel, the Alakai, began service in 2007 and was Hawai‘i’s only passenger-vehicle transportation link between O’ahu and Maui. It could carry up to 800 passengers and 200 vehicles in daily voyages.
The Alakai departed Hawai‘i on March 28 toward Mobile, Ala., the home of ship manufacturer Austal USA.
The Hawai‘i Superferry suspended delivery of the second ship, the Huakai, in October because of the poor economy. The Huakai was intended to link O’ahu and the Big Island.
“Hawai‘i Superferry would like to thank the legions of people and businesses who have supported us,” the Superferry said. “The overwhelming majority of people around the state view Hawai‘i Superferry as a much-needed and wanted transportation service.”
The bankruptcy filing dims slim hopes that the Superferry could return to Hawai‘i after the state completed its pending environmental review. State officials have said the study could take a year to finish.
The state Transportation Department initially exempted the Superferry from an environmental review in February 2005, even though the state had spent $40 million for barges and ramps to accommodate it at four island harbors.
A 2008 report by the state auditor said Hawai‘i Superferry won the exemption after it threatened to abandon Hawai‘i unless it was given the OK for service by June 30, 2005.
The courts later ruled that the environmental study was required by law.
The Hawai‘i Superferry, the only passenger ship connecting the islands, said in a statement that the expenses of maintaining its two vessels have weighed down the company because it doesn’t have any revenues.
The ferry service sought charter opportunities around the world, but those efforts haven’t produced results in time for the company to meet its financial obligations.
“Our efforts to refinance and restructure the company for this interim period with additional investment have not been successful, as yet. Accordingly, a filing of Chapter 11 was an unavoidable next step,” the Superferry said in its statement Saturday.
The Hawai‘i Supreme Court ruled March 16 that a state law allowing the company to operate while an environmental study was being conducted was unconstitutional.
Legislators crafted that law after the court ruled in 2007 the state would need to finish an environmental study before the ferry could begin service.
Environmentalists claimed in their lawsuit the ferry would strike whales, increase traffic and facilitate the movement of invasive species.
The Superferry’s first vessel, the Alakai, began service in 2007 and was Hawai‘i’s only passenger-vehicle transportation link between O’ahu and Maui. It could carry up to 800 passengers and 200 vehicles in daily voyages.
The Alakai departed Hawai‘i on March 28 toward Mobile, Ala., the home of ship manufacturer Austal USA.
The Hawai‘i Superferry suspended delivery of the second ship, the Huakai, in October because of the poor economy. The Huakai was intended to link O’ahu and the Big Island.
“Hawai‘i Superferry would like to thank the legions of people and businesses who have supported us,” the Superferry said. “The overwhelming majority of people around the state view Hawai‘i Superferry as a much-needed and wanted transportation service.”
The bankruptcy filing dims slim hopes that the Superferry could return to Hawai‘i after the state completed its pending environmental review. State officials have said the study could take a year to finish.
The state Transportation Department initially exempted the Superferry from an environmental review in February 2005, even though the state had spent $40 million for barges and ramps to accommodate it at four island harbors.
A 2008 report by the state auditor said Hawai‘i Superferry won the exemption after it threatened to abandon Hawai‘i unless it was given the OK for service by June 30, 2005.
The courts later ruled that the environmental study was required by law.
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Reader Comments
The following are comments from the readers. In no way do they represent the view of kauaiworld.com.
getalife wrote on May 30, 2009 6:56 PM:
" What a sad joke and so typical of things these days, the CEO and board walk away with millions and leave the State with guaranteed losses of millions.
Just as predicted.
Heads should roll for this. "
Just as predicted.
Heads should roll for this. "
kona wrote on May 30, 2009 7:07 PM:
" I am not surprised. This corporation did everything wrong from day one. They are the poster people for how NOT to do business in Hawaii. Thanks to everyone who stood up to big money, big favors, big lies......Now they are just big failures. "
interesting wrote on May 31, 2009 6:47 AM:
" well that will certainly be a pretty interesting footnote in the state's alternative transportation stimulus bill application :) "
jr1956 wrote on May 31, 2009 8:23 AM:
" Let's just be positive and tap our feet together and wish for the mantra of, "BRING BACK DA SUPERFERRY!" Kimo Rosen "
bodhisamaya wrote on May 31, 2009 12:21 PM:
" It is a sad day for Hawaii. The Superferry would have been a wonderful thing for the farmers of Kauai and an environmentally friendly alternative to the airliners that spew tons of jet fuel into the environment every 30 minutes leaving Lihue airport. I am not sure what those surfers were smoking thinking they were helping the environment with their blockade. They were no where to be found when the county council was discussing protecting bicyclists from dogs on the bike path. There were no blockades of traffic to protest the Kauai Bus not running full schedules for those who work weekends thereby taking cars of the highway. It was to protect surf spots and fear that caused people to protest the Superferry. Nothing but selfish motivations. "
Moku wrote on May 31, 2009 1:18 PM:
" What is the matter with you people? It is a sad thing that we lost an alternative means of transportation. Haven't you ever wanted to go camping on another island, or take a youth group to a tournament? The ferry would have been the answer.
It it true that it didn't start up in a correct way, but we should have worked together to resolve the issues. There were as many good reasons to keep as there were to have it closed. Line them up fairly and you would have seen that the good did out way the bad. "
It it true that it didn't start up in a correct way, but we should have worked together to resolve the issues. There were as many good reasons to keep as there were to have it closed. Line them up fairly and you would have seen that the good did out way the bad. "
mdmann wrote on May 31, 2009 4:29 PM:
" Can we all now commit to following rules here? Be it not following the rules of the road, illegally putting visitor accommodations in residential neighborhoods, illegal grubbing and grading, or illegally trying to push through a multimillion dollar project without conducting a required Environmental Assessment after the state outlays $40 million dollars to support the project--not following rules seems to be a rather ridiculous favorite past time here. Enough already people! This is what happens when you don't follow rules. You get burned. Often times, other people get burned as well. Don't you GET IT?! Now, either we ALL learn our hard lesson here and start doing things correctly, or we all need to just be quiet and live content with the chaos we create for our utter stupidity. My primary concern with the Superferry has always been that the law was not followed. I don't appreciate these arguments that there are valid reasons to not follow the law or times when we need to ignore the law. Individuals don't get to make the rules and you are not at liberty to disobey the rules without accepting the consequences for getting caught. Had this been handled properly from the start, the outcome likely would have been much different. This was a major screw up, and the outcome was the only proper and logical outcome. Accept it and the most valuable lesson that comes from it. "
lawaibob wrote on Jun 1, 2009 12:28 PM:
" Good riddance. Hopefully this serves as an example to any other shady businessman who think they can skirt the laws by buying off politicians in Hawaii. Lingle should be impeached for her role in this mess. "
omg watnow wrote on Jun 2, 2009 3:08 PM:
" It takes one person have to fall back on the Environmental Assessment. . . Matson, Young Brothers, Cruise Liners, Vehicle Dealership all did not do an Environmental Assessment. They're the ones that bring in the invasive species (koke frogs, snakes, illegal plates, etc), traffic and problems. Why don't all you haters of the ferry stop the mainland airlines or the foreign planes from landing. Illegal activities where done but now we have the governor requiring workers 36 days a year for 2 years work without pay to cover her mistakes. The state (Lingle) should pull the millions of dollars out of her okole and payback the state for her wrong doings. Maybe the state should donate these ramps for someone that can use it or try to bring the ferry back. The ferry was and still can be another means of travelling the state. BRING THE FERRY BACK. "
mdmann wrote on Jun 3, 2009 12:08 AM:
" One must fall back to the Environmental Assessment because that is the root cause of the problem. The assertion that Matson, Young, Brothers, cruise lines, and others have never done an EA is simply false, false, false. I would point you to the following:
http://the.honoluluadvertiser.com/article/2007/Sep/09/ln/hawaii709090361.html
Now, I'm sure someone will counter with "You believe everything the Advertiser says?" But the article clearly states that STATE RECORDS SHOW these companies HAVE gone through the EA process in recent years for specific projects. In most cases, it was determined that no EIS was required. Had Superferry just followed the process, they may have had the same result, but they didn't, and they got called on it by concerned citizens. Those citizens were well within their rights to do so, though their specific tactics in certain situations were not wise and likely also not legal. Make no mistake, though, it was the state that precipitated this mess with their illegal action. Trying to obscure the issue by saying Matson and these other companies should be shut down for not doing EAs is irresponsible, and continually making fallacious claims doesn't make your claims true. The people who messed this up are in Honolulu, and they should be held accountable for their actions. You can't do that if you refuse to accept what happened as wrong and accept the logical consequences.
Perhaps we should just change the state motto to "Ainokea. I do what I like!" That seems to be the prevailing mode of life here. Enough of this already. This attitude does not make for an ordered society. If this isn't a clear enough example of the chaos such a selfish attitude can cause, I don't know what is. "
http://the.honoluluadvertiser.com/article/2007/Sep/09/ln/hawaii709090361.html
Now, I'm sure someone will counter with "You believe everything the Advertiser says?" But the article clearly states that STATE RECORDS SHOW these companies HAVE gone through the EA process in recent years for specific projects. In most cases, it was determined that no EIS was required. Had Superferry just followed the process, they may have had the same result, but they didn't, and they got called on it by concerned citizens. Those citizens were well within their rights to do so, though their specific tactics in certain situations were not wise and likely also not legal. Make no mistake, though, it was the state that precipitated this mess with their illegal action. Trying to obscure the issue by saying Matson and these other companies should be shut down for not doing EAs is irresponsible, and continually making fallacious claims doesn't make your claims true. The people who messed this up are in Honolulu, and they should be held accountable for their actions. You can't do that if you refuse to accept what happened as wrong and accept the logical consequences.
Perhaps we should just change the state motto to "Ainokea. I do what I like!" That seems to be the prevailing mode of life here. Enough of this already. This attitude does not make for an ordered society. If this isn't a clear enough example of the chaos such a selfish attitude can cause, I don't know what is. "
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ChewyBacon wrote on May 30, 2009 4:35 PM: