Craig M. Johnson


May 10, 2009 --

State pols have launched an investigation into a Governors Island redevelopment team's $500,000 purchase of an aging ferry with taxpayer dollars that was recently sold off on eBay for just $23,600 because it was so dilapidated it was not worth fixing.

Officials for the city-state Governors Island Preservation and Education Corp. testified Thursday in Manhattan before the state Senate Standing Committee on Investigations and Government Operations that $698,000 is the actual tab to taxpayers for the lemon that was supposed to be used a second island ferry.

This includes $198,000 in fees to consultants who reviewed the plan two years ago to buy the then-57-year-old "Islander" ferry from the Nantucket Steamship Authority. GIPEC sold the ferry, which in its heyday ran trips to and from Martha's Vineyard, on eBay in January.

GIPEC, officials testified, bought the ferry at the recommendation of a private consultant, Jamestown Maritime Services in Connecticut, opting to ignore the operator of its own public ferry service, who determined the vessel was better off in a scrap yard.

The operator even brought in his own risk management consultant who testified that, within four hours of examining the ferry, he knew it was unsafe, needed massive repairs to its hull and wasn't worth insurance risks.

Sen. Craig M. Johnson, (D-LI), chairman of the committee, told the Post he has serious questions as to why GIPEC staff failed to provide its own board with this consultant's report -- but instead focused on Jamestown's recommendations -- before asking the board to sign off on the sale.

"It's a smoking gun that should have given serious pause as to whether the deal was best for taxpayers," Johnson said.

GIPEC President Leslie Koch said that while the agency regrets taxpayers not getting what they paid for she believes GIPEC followed proper procedures. She also said the agency is no longer seeking a second ferry to provide free public access.

Officials said that GIPEC won the bid and agreed to buy the ferry months before its board was asked in October 2007 to ratify the acquisition.

While GIPEC lawyers said they don't believe they can recoup money from Jamestown for providing bad advice, committee members disagreed.

"I don't see anything criminal here, but I do see a lot of stupidity, said Sen. Martin Golden (R-Brooklyn).