Editor’s Note: Second Part of a Series of Three

The N.C. Ferry Division buys a new pontoon boat for a ferry service across the Currituck Sound, but the boat fails to perform as expected. Division workboats cut an illegal channel in the sound, instigating a raid of division offices and vehicles by federal and state law-enforcement officials.

RALEIGH — The N.C. Department of Transportation’s project to establish passenger-ferry service across the Currituck Sound is a long way from hauling the schoolchildren it ostensibly was designed for.

With Sen. Marc Basnight of Dare County as the driving force, the N.C. General Assembly appropriated $834,000 in June 2003 for the project. But evidence shows that the legislature approved the project without ordering a thorough analysis. Meanwhile, problems continue to multiply.

Indicative of complications was the delivery of a new 50-foot, 49-passenger pontoon boat to the State Shipyard in Manns Harbor in August 2004. The boat cannot be put into service because there is no place to dock it at Corolla.

In July 2002, Danny Noe, a marine quality assurance specialist with the state Ferry Division, started looking for a suitable boat for the service. One vendor was Trident Florida Trading Company in Taveres, Fla. Noe received information from the company in September 2002, and continued to correspond with company officials about customizing one of their standard boats.

In September 2003 Basnight complained to Gov. Mike Easley when the senator read a news story that said DOT had put the project on hold. “I passed those commitments along to the people of Currituck County with my continued support and assured them the ferry was secure,” Basnight wrote. Basnight’s influence apparently got the project moving.

Requests for bids were sent out in October. Trident was the only bidder. But because of all the changes DOT had requested to his standard boat, Trident President Robbie Cunningham added $100,000 to his original proposal. After considerable negotiations, a compromise on price, delivery, and specifications was reached. In November, DOT signed a contract with Trident for a 50-foot, 49-passenger, enclosed-cabin pontoon boat.

Securing a boat was only part of the project. The boat still needed an adequate channel in which to operate.

“Although a pontoon vessel configuration operates in a very shallow water, the approach channel into Corolla would still require some dredging. In periods of sustained Northerly, Northwest and especially Northeast winds, the water is blown out of the sound,” Ferry Division Jerry Gaskill wrote in a letter to DOT Secretary Lyndo Tippett in January 2003. “The Ferry division recommends establishing a channel that is 40’ wide by 6’ deep.”

“It is important to note that the appropriate CAMA permits be acquired prior to the commencement of the dredging phase of this project. This could be a very lengthy and costly process if Environmental Impact Statements and other documents are required. Although we believe that this responsibility should fall to the county, we will be prepared to assist them in any way possible,” Gaskill wrote.

As of May 2004, neither NCDOT nor Currituck County had applied for a permit from the U.S. Army Corps of Engineers. Ferry Division workboats dredged a channel anyway near Corolla that month.

Superintendent of Dredge and Field Maintenance Bill Moore, who reports directly to Gaskill, said the dredging was accidental. Moore, who was the supervisor at the scene where three Ferry Division workboats cut the channel, claimed responsibility for the dredging. But both Moore and Gaskill said that the boats did not “kick a channel” with their propellers.

Gaskill told newspaper reporters that the boats got stuck while marking the channel. News reports about the dredging surfaced in early July 2004, when Jan DeBlieu, Cape Hatteras coastkeeper with the North Carolina Coastal Federation, issued a press release. The new channel was estimated to be 700 feet in length, 30 feet wide, and 5 to 6 feet deep. Previously the area was 2 feet deep. The N.C. Division of Coastal Management issued DOT a violation notice June 28 for dredging without a permit.

In June 2005 Ferry Division Business Officer Charlie Utz told CJ that Ferry Division officials did not know previous applications for dredging permits had been denied. He said Currituck County Manager Dan Scanlon was responsible for concealing the information. He said the illegal dredging was bad judgment by one employee, Moore. The Ferry Division has since filled in the dredged area with material brought in from another location.

Federal investigation

In August 2004 state and federal law-enforcement officials raided the division’s central office in Morehead City, the State Shipyard in Manns Harbor, the field maintenance office in Havelock, and the boats that dredged the channel. The raid was conducted the same day the pontoon boat was delivered by truck to Dare County.

The search warrants were issued at the request of a special agent in the Criminal Investigative Division of the U.S. Environmental Protection Agency. Agents from the State Bureau of Investigation also participated in the raid. The warrants also specifically allowed for a search of the state vehicles used by Gaskill and Moore, and any personal or official notes maintained by the men. Officers seized work orders, memos, files, notebooks, computer hard drives, a laptop computer, and “documents from Gaskill’s leather portfolio,” returned search warrants show.

Federal investigations are notoriously slow and officials rarely release information about an ongoing probe. CJ learned from a source, who requested anonymity, that some of the employees involved in the dredging have been told by DOT to hire lawyers. Tippett told the employees that the state would reimburse them for legal expenses unless they pleaded guilty or were convicted. Some of the lawyers hired by the employees have met with officials of the U.S. Attorney’s Office in Raleigh. Plea agreements have been prepared, but CJ has been unable to determine whether any of the employees signed them.

Controversy over the boat’s performance

Sea trials conducted by the Ferry Division in January 2005 indicate the boat can operate safely at only 13 mph with a load of 25 passengers. Also, Utz said the boat would require 31 inches of water in which to operate, even though he and others at the Ferry Division thought they ordered a boat able to operate in 18 inches of water.

“The boat builder provided a boat that did not meet our specifications, that we are currently in a lawsuit with,” he said. Asked why the boat did not meet specifications, Utz said, “Because Danny Noe was in charge of the project and because the boat builder misrepresented this project.” He acknowledged the project has been a mess from the start. But Noe was taken off the project in June 2004. Noe was found dead in April 2005. The Carteret County District Attorney has not ruled whether Noe’s death was suicide or homicide.

DOT has not pursued legal action against the boat builder. Ferry Division spokesman Bill Jones said about the boat: “It does not meet specs for speed or draft. No decision has been made on legal action.”

Cunningham disagrees with Utz’s assessment of the boat’s performance. “I never agreed to 30 miles per hour, because there are too many variables. We changed everything. I went back to them and said I will build according to the original agreement,” Cunningham said. He said the boat was built so the motors can be raised, allowing it to operate in shallow water. He said shortly after it was delivered that the Ferry Division personnel had told him the boat was very fast. He said that a January 2005 memo on the sea trials indicating the boat could go only 12 to 17 mph with a load of 25 passengers “was not credible,” and that the boat should go much faster. He said he thought that Ferry Division employees operating the boat needed training on that particular model.

In May 2005, frustrated with the lack of progress, Basnight called a meeting of all the state agencies involved in the project. It was determined at the meeting that a 1,800-foot pier would be built at the Whalehead Club into an area of deeper water in the sound.

That plan was scrapped after CJ and other news organizations reported concerns about the safety of schoolchildren being on a pier that would be twice as long as the longest pier on the U.S. East Coast. In June the Wildlife Resources Commission released a substitute plan for a 500-foot pier, but the school year was to begin Aug. 25 and the few schoolchildren from the Currituck Outer Banks will continue to travel by bus to their schools on the mainland.

The Wildlife Resources Commission is still working with Currituck County to find a suitable location for a dock at Corolla. The pontoon boat is gathering barnacles at the State Shipyard in Manns Harbor. Utz has resigned from the Ferry Division to start a new business. The Carteret County Sheriff’s Department says the investigation of Noe’s death is still open, pending laboratory results from the State Bureau of Investigation.

Don Carrington is executive editor of Carolina Journal.

Wednesday’s story: Danny Noe, a Ferry Division employee who was a key witness in a federal investigation, is found dead at his home. Officials think Noe might have committed suicide, but family members and friends think he might have been slain.