Steamship Authority Ripped By State Inspector General For Website Project Failure
JohnCarl McGrady and Jason Graziadei •
In a scathing report released on Thursday, the Massachusetts Inspector General accused the Steamship Authority of wasting millions of public dollars on a failed website redesign project that the state says was “doomed from the start.” The Inspector General’s review, launched in 2023 after multiple years of website crashes during peak reservation periods and significant delays in the ferry service’s promised website redesign, outlines a lengthy list of administrative failures over the course of a blistering 59-page document.
The Steamship Authority’s website redesign efforts, which began in 2022, were ultimately shelved before a new website could be completed, in what Inspector General Jeffrey Shapiro referred to as an “unacceptable waste of public resources.”
Steamship Authority spokesperson Sean Driscoll declined to comment, saying that "as we have only recently received the report, we are unable to comment on specifics until that review is complete.”
Calling the website redesign process a “cascade of failures,” Shapiro lambasted the Steamship Authority for “poor project leadership and decision-making,” stemming in part from what he characterized as a failure to recognize “a plethora of information indicating that the underlying reservation system should have received priority” over redesigning the front-facing website.
“The residents of Martha’s Vineyard, Nantucket, and Cape Cod deserve a professional, accountable ferry line,” Thomas Moakley, Nantucket’s representative at the State House, said in response to the report. “I hope that these findings and recommendations coming from an unbiased and thorough source like the Inspector General’s Office will serve as a catalyst for change.”
The report argues that the Steamship Authority should have focused on redesigning its outdated online reservation system, which has been the subject of significant concern in consultant reports to the Authority since at least 2018, rather than on the website itself. The ferry service eventually changed course and began an overhaul of the reservation system after the lone engineer behind the existing system, a 70-year-old man living in Wisconsin, announced his retirement, but not before spending over $4 million on a new website that is still not available to the public.
"In addressing the public-facing website before the back-end reservation system, however, the Steamship Authority failed to mitigate the glaring operational risk of relying on an aging, custom-built system that could only be fixed by the person who built it," the report states. "The Authority’s leadership became blind to the underlying dilemma: that developing a new website around a reservation system that needed replacing would likely result in a substantial waste of time and money."
Rob Ranney, who represents Nantucket on the Steamship Authority's Board of Governors, told the Current on Thursday that he had just received the report and had only had the time to skim through it so far, but acknowledged it painted an unflattering view of the ferry service and its management.
"It's a pretty scathing report," Ranney said. "From my perspective as a board member, certainly whatever recommendations there are, we'll take those to heart going forward and see if we can correct the course, as they put it, and continue on. But I think it's easy to look back at some of these things. Certainly, some of the issues that were in the 2020, 2021, 2022 timeframe, COVID was going on, and there were some challenges that the board faced and the Steamship Authority faced during that period that are not even mentioned in the report. There are always other factors involved. But I'm certainly open to taking any recommendations and moving with them forward."
The report also outlines “myriad failures in project planning, project management, and project oversight on the part of the Steamship Authority administration and its Governing Board.” In one particularly striking case, the report says the Steamship Authority agreed to pay $350,000 for the source code of their reservation system in 2024, code they had already purchased for a tenth of the price in 2010, after they were unable to find any signed record of the previous agreement.
“This report is a gut punch for every island resident, worker, and business owner who depends on the Steamship Authority as a lifeline. Millions of dollars in public funds were squandered because of basic failures in leadership, planning, and oversight, and the public was repeatedly given assurances that simply were not true,” said Julian Cyr, who represents Nantucket in the Massachusetts State Senate. “That kind of mismanagement does real damage, not just to finances, but to public trust, and rebuilding that trust will take time and sustained accountability. The Steamship Authority has an obligation to operate with competence, transparency, and respect for the people it serves. This report makes clear that obligation was not met, and it cannot happen again.”
Shapiro’s issues with the ferry service go well beyond the specific website failure, with his report claiming that “the institutional failures the [office of the Inspector General] identifies in this report are ongoing and likely affect the Steamship Authority’s other major projects, daily operations, and general management” and that “the Steamship Authority has not learned from its experiences during the website project and is maintaining poor practices for future projects.”
The report recommends that the Steamship Authority revisit its administrative procedures and overhaul its handling of large projects. It also urges the Massachusetts state legislature to establish a special commission tasked with reviewing the Steamship Authority’s enabling legislation.
The suggestion that the 65-year-old state law that created the Steamship Authority and established the weighted voting system on its Board of Governors, which favors the island representatives, is particularly concerning, Ranney said.
"That is definitely a concerning thing, certainly for Nantucket, maybe more so than anywhere else," Ranney said. "It's hard for people who don't live on an island, out in the ocean who cannot see the mainland, it's hard for people to understand how scary it is when somebody who is not from here, doesn't rely on the service, doesn't know what it's like to live here, starts to tinker with things that we have come become accustomed to and the way we rely on things, and they start trying to change it. Now, having said that, there probably are some positive changes that could come about, and that's great, but it can be certainly scary."
The report states that a special commission could determine "whether the Authority’s
65-year-old enabling statute is ripe for revisions or updates."
Beyond its criticisms of the Steamship Authority's management of the website project, the report also takes aim at the oversight function of the five-member Board of Governors.
“For their part, Board members did not ask enough questions as they heard overly optimistic, unrealistic, or incomplete information," the report states. "They either did not understand or did not execute their oversight function, resulting in many instances in which they failed to exercise their fiduciary responsibilities.”
In a prepared statement issued by the Steamship Authority Thursday evening, board members James M. Malkin and Chair Peter J. Jeffrey responded to the report by saying, “The Board acknowledges that continued improvements in planning, process, and oversight remain necessary. Over the past few years, the Board has focused on the SSA’s IT infrastructure needs and has outsourced a new reservations system, engaged qualified consultants, and created an IT Executive Steering Committee, all aimed at prioritizing an efficient IT infrastructure. The Board is eager to embrace improvements in all SSA functions as it enters a new era under the leadership of Alex Kryska.”
Shapiro was sharply critical of outgoing Steamship Authority general manager Bob Davis, who the Inspector General said “continually exercised poor judgment during the project, regularly misdirected the Board about the project’s status, and appointed an unqualified project manager who proved incapable of making informed and timely decisions.” Shapiro criticized the Authority’s board for agreeing to keep Davis on as a senior advisor after he leaves his position as general manager, a decision he claims could “impede the new general manager from setting his course for the Steamship Authority.”
“Frankly, the demonstrated mismanagement over many years should give us all pause,” Cyr said, agreeing with Shapiro. “If we want to set up the new [Steamship Authority] general manager for success, I would suggest that a perfectly clean slate is in order.”
Critics of the Steamship Authority, including members of the Cape and Islands legislative delegation, have also taken the report as an opportunity to reiterate their support for a contentious bill seeking to impose term limits on the Steamship Authority Board.
While Martha’s Vineyard leaders have been divided on the bill, the Nantucket Select Board came out unanimously against the proposal in August.
Shapiro did express optimism that the hiring of the Steamship Authority’s new general manager, California maritime and transportation executive Alex Kryska could signal “a new day” for the ferry service and an opportunity to “examine its operating procedures, consider new approaches to project management, adopt best practices, and set a true tone from the top.”
The report also calls for improved governance by the Steamship Authority Board, claiming that it “exercised virtually no meaningful oversight” during the website redesign process.
Among the many shortcomings identified in the report is the Steamship Authority’s mishandling of federal and state funds. The report details several cases where the ferry service allegedly failed to understand grant requirements. In one case, the report says that the administration submitted a reimbursement request to the Massachusetts Department of Transportation for $353,802 of work done pursuant to a grant, only to hear back that all of the work had been done before the state gave the Steamship Authority permission to proceed, meaning that none of it could be reimbursed through the grant.
Other shortcomings alleged in the report include hiring an unqualified project manager, not adequately encouraging employee feedback, failing to establish a scope of work, withholding critical documents and information from the board—including criticism of the project issues identified in the review—and board members viewing themselves as Steamship Authority ambassadors tasked with approving the general manager’s recommendations rather than community advocates providing oversight for all projects.
In a series of recommendations included at the end of the report, Shapiro requests that the Massachusetts Department of Transportation claw back “any monies reimbursed for the website project.”
Ranney emphasized that the board would seriously consider all of the report's recommendations and conclusions.
"I'm not stuck in my ways," Ranney said. "If it's something that's going to make things better or make it easier for Nantucket residents or travelers to get to and from Nantucket, then that's great. But if you start picking apart, and I hate to use cliches, but you don't always want to know how the sausage is made. And if you start picking apart the enabling act, and picking apart how the weighted votes go, how board members are appointed, how all of that stuff works, you could turn this whole thing upside down, and then we're in a worse position."