The state Transportation Commission will recommend that the Legislature consider adding revenue from regional taxes as a “third leg” of a long-term funding scheme for Washington State Ferries.

At a meeting on Bainbridge Thursday night, Transportation Commission member Bob Distler said the ferry system has been supported by fares and money from statewide taxes, but the commission is now studying local revenue in its search for future funding options.

“We are now looking at a series of local options, which are taxes, I’ll use the ‘T’ word,” Distler said. “The question is what geographic area would be covered by those taxes, and how could those taxes tie in to possible changes in the statewide taxing structure to fund the ferry system.”

Proposed funding options were presented Thursday as part of an update on the commission’s Long Term Ferry Funding Study, tasked to the commission by the Legislature. WSF officials also presented strategies they that might make better use of existing terminals and vessels, and promote walk-on and off-peak demand. Strategies include reservations price changes and transit improvements.

The long-range funding and operations strategies will be refined and sent to the Legislature for consideration in its next session.

Few members of the public turned out to the Thursday meeting, which ran at the same time as the vice presidential debate. State employees and transportation commissioners handily outnumbered Bainbridge citizens.

WSF chief David Moseley opened the meeting with a presentation of the system’s funding challenges.

Even without expanding the current system, WSF is projected to have a $3.9 billion shortfall over the next 22 years. Maintaining WSF’s terminals and boats would account for $3.37 billion of that gap.

Since revenue for WSF from the Motor Vehicle Excise Tax was revoked in 1999, $300 million in Department of Transportation discretionary funds have been used for ferry operations. Another $575 million in discretionary money and bond revenue has gone to support ferry infrastructure.

WSF is expecting ferry ridership to increase by more than 30 percent over the same period.

“As you have all heard me say, the ferry system is not financially stable today, and it’s not financially stable to date,” Moseley said.

In its last session, the Legislature instructed the Transportation Commission to look for sustainable means of funding WSF.

Distler said the Commission will be proposing a “three legged” approach to funding WSF, which would include money expanded revenue from state taxes, fare collection, and local or regional tax districts. In its proposed model, ferry acquisition and maintenance would be paid for with state funds and a mix of local and state funds would be used for terminal improvements.

Money from fares, advertising and concessions would go toward operations, supplemented by state and local funds.

Distler said collection on local taxes would be implemented regionally, not on a route-by-route basis. Any use of local tax money would have to be approved by voters.

The commission will bring a variety of funding options to the Legislature for consideration.

State Rep. Christine Rolfes of Bainbridge said she has reviewed a report from the commission on its work thus far, and is critical of the “local funding” option.

She said using local tax revenue for ferries would likely be unpopular in King and Pierce counties and that funding WSF should remain a state issue. Rolfes said the Legislature isn’t likely to include local tax revenue in a funding plan.

“I’m truly confident that it wouldn’t pass,” she said.

WSF staff presented three operations strategies that could be phased in to ease demand on existing facilities.

First would be a reservation system, which would allow riders to book a particular sailing in advance and arrive 30 minutes before departure to board. WSF staff said the system would lessen the need for large vehicle holding areas.

Michael Hodgins, a WSF consultant with Berk and Associates, said WSF could allow frequent ferry users to makes reservations for weeks of sailings at a time. He said the reservation system could benefit commuters by setting aside large portions of boats for regular users during peak hours.

A reservation system is currently used on the Port Townsend/Keystone route.

A second strategy would use streamlined transit connections to promote walk-on passengers. Improvements could include better timing with buses, more park -and-ride connections and new facilities for walker and bicyclers at the terminals. Enhancements would depend on cooperation with regional transit agencies, and a funding source has yet to be identified.

To lessen congestion during peak hours, WSF could implement pricing incentives and disincentives. On the Bainbridge route, that could mean a vehicle surcharge during peak hours, a walk-on discount and a discount for smaller vehicles.

As they did at earlier ferry meetings, commuters said Thursday they were concerned that peak-hour fare increases would do little to shift demand, while raising costs for commuters who don’t have a choice of what ferry they catch.

“You have to be on that road – in our case that ferry – during those peak times,” said Bainbridge commuter Martha Burke, who chairs the Executive Committee of Ferry Advisory Comittees.

If those strategies failed to manage demand, service changes could be made. Service on the Bainbridge route would not be altered, but more sailings could be added to the Kingston and Bremerton routes to help pull Kitsap traffic away from Bainbridge and State Route 305.