Citing economic hardship as coastal North Carolina recovers slowly from the recession and Hurricane Irene, Gov. Bev Perdue announced Tuesday that the state Department of Transportation will not collect new ferry tolls ordered last year by the legislature.
"This new ferry tax - which I have always opposed - is both excessive and discriminatory," Perdue said in a news release. "It is unjust for the General Assembly to balance their budget on the backs of coastal working men and women."
DOT officials had been preparing to announce rates for tolls and commuter passes to take effect April 1 - as specified in the state budget passed by the Republican-led legislature over the veto of Perdue, a Democrat.
The budget directed the DOT Ferry Division to start collecting tolls on two routes, now toll-free, that are used heavily by commuters - the Pamlico River ferry that serves the PotashCorp phosphate mine at Aurora and the Neuse River ferry used by workers at the Cherry Point Marine Corps Air Station.
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Higher rates were ordered for existing tolls on the two Pamlico Sound ferries that connect Ocracoke to Swan Quarter and Cedar Island, and for the Cape Fear River ferry between Southport and Fort Fisher.
Perdue said she would impose a 12-month moratorium on the new and increased tolls. DOT will be ordered to find enough spending reductions to make up for the lost ferry toll revenue. That could mean cutbacks in ferry schedules, which already have been reduced in the past year.
Her news release said state law gives DOT "the discretion of whether to collect" the tolls. The statute cited by the governor empowers DOT to maintain ferries "and to prescribe and collect such tolls therefor as may, in the discretion of the Department of Transportation, be expedient."
The governor's decision drew rebukes from Republican legislators.
"I'm disappointed she chooses to pander to folks in that way," said Rep Frank Iler of Brunswick County, who helped shape the transportation budget last year. "Someone who has a job and wants to cross the river and buy a pass would be paying less than $1.50 a day. I think it's extremely reasonable.
"It's a user fee. If you don't ride the ferry, you don't pay it. Taxpayers are covering 94 percent of ferry operating costs now," Iler said.
Sen. Phil Berger of Rockingham County, the Senate Republican leader, said the toll increases would offset only a small share of ferry expenses.
"Gov. Perdue is violating her oath of office by acting illegally, and we expect the Department of Transportation to follow the law," Berger said in a statement. "Because Gov. Perdue and our predecessors in the legislature nearly bankrupted the state, we had to make tough decisions to balance the budget."
Coastal commuter approves
Richard Paul, 56, a ferry commuter who lives in Pinetown, argued that the state is right to finance the ferries with gas tax revenues that also pay for state roads.
"I pay taxes, right?" said Paul, who has been riding the Pamlico River ferry to work at PotashCorp for 34 years. "This is part of our highway system, as far as I'm concerned."
The Pamlico and Neuse ferries counted 534,841 passengers last year.
"We're pleased for employees who depend on the ferries and would have incurred an additional burden in a struggling economy," PotashCorp spokesman Ray McKeithan said.
Rep. Bill Owens, a Pasquotank County Democrat, praised Perdue's decision. He said the higher tolls would have discouraged tourists who now pay $30 for a round trip across the Pamlico Sound to Ocracoke.
"I certainly wouldn't increase it right now, in the tight financial times," Owens said.
Owens said House Speaker Thom Tillis, a Mecklenburg County Republican, had been looking for ways to reduce or delay the ferry toll increase. A Tillis spokesman declined comment.
At hearings in January and earlier this month, DOT officials had told coastal residents they were "handcuffed" by the legislature's mandate to increase toll receipts from $2 million on three routes this year to $5 million on five routes by 2015. Perdue spokesman Mark Johnson said Tuesday he did not know when the governor's staff had concluded that DOT had legal authority to delay the toll increase for a year.
Perdue, who has announced she will not seek re-election, will leave office before her toll moratorium ends.