ANCHORAGE, Alaska (Reuters) - Alaska’s ferry system, serving dozens of coastal communities that lack outside road access, was shut down for a second straight day on Thursday by a boat workers strike protesting stalled contract talks and deep budget cuts imposed by the governor.

About 420 members of the Inlandboatman’s Union of the Pacific (IBU) walked off the job on Wednesday after three years of labor negotiations with the state-run Alaska Marine Highway System hit a stumbling block.

The strike, the first such walkout against the ferry system in 42 years, came at the peak of summer vacation season, posing a potentially crippling blow to tourism across the southeastern Alaska panhandle.

The IBU represents most of Alaska’s ferry workers, including deckhands and other lower-level employees. Two other unions representing ferry pilots and engineers have vowed to honor the IBU’s picket lines.

The Alaska Marine Highway System website promoting getaways to more than 30,000 miles of picturesque shoreline posted a special notice saying its vessels “will not be sailing until further notice” due to the strike.

In a statement released late Wednesday, Governor Mike Dunleavy’s administration decried the walkout, blaming the union.

“The state did not want a work stoppage, nor does the state believe the strike is necessary to reach an agreement,” Commissioner of Administration Kelly Tshibaka said. “It will be detrimental to negotiations and is going to seriously harm the communities and Alaskans served by the ferry system.”

According to IBU President Marina Secchitano, Dunleavy, a Republican who took office earlier this year, has sought to roll back concessions previously won by the union while cutting $44 million from the ferry’s operating budget.

Dunleavy earlier this year proposed a reduction in ferry system spending about twice as deep, and a complete shutdown of ferry service in winter, Secchitano said.

Among the dozens of island and coastal communities that rely on ferries for transportation of passengers, vehicles and day-to-day supplies is Juneau, the state capital, which can be reached from the outside only by boat or plane.

An additional $440 million in state spending cuts that Dunleavy imposed through line-item budget vetoes last month are also starting to take their toll.

In Anchorage, the state’s largest city, Mayor Ethan Berkowitz declared a civic emergency on Wednesday in anticipation of hundreds of homeless people being turned out onto the streets as public shelters are forced to close or scale back services due to some of those cuts.

Moody’s on Thursday downgraded Alaska’s investment outlook from “stable” to “negative.”