The ferry Kalakala has been declared a hazard to navigation, and if it should sink and block access to the Port of Tacoma, it would cost the port as much as $23 million a month and idle 1,300 workers, according to the Army Corps of Engineers.

The hazard declaration means, among other things, that the ferry's mooring arrangement is inadequate, according to the Coast Guard.

The Coast Guard, in a letter sent to Kalakala owner Steve Rodrigues on Thursday, rejected his appeal and told him he must provide plans to tow the boat. He was told he must repair the hull and submit a plan for dealing with the boat in heavy weather.

This sets the stage for the Coast Guard and Corps of Engineers to decide what's next for the decaying old boat.

"Our main concern is keeping it from becoming an obstruction," said Corps spokesman Bill Dowell.

The Corps, which would be in charge of disposing of the boat, said it has four options:

• Do nothing.

• Remove the boat if it's considered a significant threat of sinking.

• Work with the Coast Guard — if it's not an immediate threat — to decide its fate, including removal or

• "Pinning" it, which means anchoring it in place so if it sank it wouldn't roll into the waterway.

Removing the boat would take three to five months, Dowell said.

The Coast Guard had set a Dec. 19 deadline for Rodrigues to repair the hull of the Kalakala and submit a plan to tow it from its berth at Hylebos Waterway in Tacoma, where it has been parked for the past six years.

The Coast Guard is taking a tough stand because of the degradation of the ship's hull and lack of reliable dewatering equipment, said Regina Caffrey, with the Coast Guard.

"We rejected his appeal. It wasn't sufficient and there was no evidence of new information that anything had been done," she said.

Rodrigues, who could not be reached, said last week that he had sold the ferry to an anonymous out-of-state buyer who plans to restore it. He didn't tell the Coast Guard the name of the new buyer, nor did he provide any evidence of a transaction, the Coast Guard said, adding that it still believes Rodrigues is the owner.

The 276-foot silver ferry with sleek lines sailed on Puget Sound from 1935 to 1967. After its ferry days, it became a fish-processing ship in Alaska and later was all but abandoned. It was towed back to Washington in 1998 with the idea it would be restored, but no one came up with the money to do so.

Susan Gilmore: 206-464-2054 or sgilmore@seattletimes.com