Due to tentative concessions made by state ferry workers, ferry service reductions and fare increases may not be as severe as predicted late last year, when the state announced that major cuts were necessary to keep the financially unstable system afloat.

Lawmakers from both the House and Senate say they likely won’t end this year’s session with a permanent source of funding to fill the ferry system’s deficit of $900 million over the next decade, as ferry officials and the governor had hoped. However, they expect other savings will allow the state to avoid the large cuts proposed by Gov. Chris Gregoire in her December budget.

The House’s transportation budget, released Monday, calls for $3.1 million in ferry service cuts, a far cry from the $20 million reduction Gregoire had sought.

Vashon, however, would not escape unscathed under the new budget. Though the budget does not include the reduced car-capacity initially proposed on the Fauntleroy-Vashon-Southworth route by replacing the Issaquah with a smaller vessel, the route would see reduced hours eight weeks a year. In addition, the Pt. Defiance-Tahlequah route would see reduced mid-day and late-night service.

Four other routes would also see service reductions.

The House budget calls for a 7.5 percent fare increase, compared to the 10 percent Gregoire had proposed. It also sets aside $65 million for the construction of a 144-car ferry beginning in 2012.

Rep. Mike Armstrong (R-Wen-atchee), ranking minority member of the House transportation committee, said the savings reflected in the budget were largely possible because of a tentative deal the state reached with ferry-worker unions early this month that would save the system $10 million annually in labor costs.

Recent cuts in ferry management and operations will save the state an additional $10 million over the next two years.

David Moseley, head of Washington State Ferries, said he was pleased the state and ferry-worker unions were able to reach a tentative agreement. He said one union has already ratified the agreement, and the others may do so by the end of the month.

Under the new deal, Moseley said, ferry workers would take a 3 percent pay cut similar to the ones other state workers agreed to and would receive time-and-a-half overtime pay rather than double pay. If approved by union members, he said, it would be a show of sacrifice on their part.

“Those are the types of things that demonstrate their willingness to help us with our financial crisis,” he said.

Although Moseley and the governor have been urging lawmakers to secure a permanent source of funding for the ferry system this session, Armstrong said the House transportation committee feels that it’s not the time to introduce a large spending package.

“We’re still in a recession, and a new revenue package means people pay more. … We don’t want to worsen a recession by adding a new revenue package this year that could have devastating consequences on people,” he said.

Though ferry savings reflected in the House budget total $40 million over the next two years, it  doesn’t fill the system’s large deficit, and the budget calls for a transfer of $80 million from other transportation accounts to the ferries. Moseley said that after the next biennium, those accounts can no longer bail out the ferries as they have for the past 10 years, since the repeal of the Motor Vehicle Excise Tax.

“Those (accounts) are also in the red after the 11-13 biennium … That’s what the governor means when she said there’s no more Band-aids in the box,” Moseley said.

Armstrong said he anticipates a revenue package will be introduced in the near future, but this year lawmakers are focusing on making the ferry system run as efficiently as possible.

“When there is a revenue package they can trust, money is spent wisely,” he said.

Such a revenue package, according to Sen. Sharon Nelson (D-Maury Island), a member of the Senate transportation committee, could take the form of a comprehensive transportation measure and appear on the ballot as early as fall of next year.

Though the Senate committee didn’t release its transportation budget until after the House, Nelson said it has similar goals concerning the ferry system.

“We continue to work for no cuts in service, or they will be so minimal that it will have no impact to communities,” she said.

With at least another month left in the legislative session, much is still up in the air as lawmakers work with the governor to finalize the transportation budget. In the meantime, several bills aimed at making the ferry system more efficient are still making their way through the House and Senate, including one that would set performance standards for middle-level ferry management and contract out that management if standards aren’t met.

In addition, Nelson said, the Senate transportation committee has been looking at options to fund the construction of a 144-car ferry. One bill would impose a 25-cent surcharge to go towards ferry construction and repairs.

Moseley said such a surcharge wouldn’t fully fund a new boat, but could allow construction to begin as early as 2012.

“It’s a good down payment,” he said.

Nelson said ferry budget negotiations were further complicated by recent tax revenue projections, which showed a $50 million loss in the transportation budget.

“We know (the labor concessions) will offset some of the service reductions and fare increases. But with this new $50 million shortfall, it now has to be sorted out for the entire transportation budget,” she said.

Kari Ulatoski, chair of Vashon-Maury Island Community Council’s Transportation Committee, said she was pleased to see lawmakers work to make the ferry system more efficient, but wishes the state would find a permanent fix to the ferries’ funding problem.

“It’s something we go through almost every single year. We shouldn’t have to worry about maintaining our current service every year. … The bottom line is we have to have a new source of revenue,” she said.

As in past years, Vashon’s transportation committee has headed a campaign to lobby for the the Island’s service, saying reduced runs and higher fares could have devastating effects on the community. Earlier this year, the committee presented a petition to the governor signed by 8,000 state residents and urged Vashon business owners to write lawmakers with their concerns.

Last month, more than a dozen Vashon volunteers joined those from other ferry-dependent communities in spending two weeks meeting with lawmakers in Olympia, lobbying for no cuts in service, permanent funding for the ferries and the construction of new boats.

Ulatoski felt that the effort, organized by the Ferry Community Partnership, was more effective than last year’s demonstrations outside the capitol.

“That (method) was recommended because there were so many rallies that we would have gotten lost in the shuffle,” she said.

As lobbying now slows, Ulatoski, who has been critical in organizing Vashon’s lobbying efforts for several years, has announced she will step down from the transportation committee in April.

“It’s pretty much taken all of my time, and I need a break …. and for health reasons I need to focus on