The boat operator, a man in his 50s, his wife and 14-year-old grandson set off from the Port of Kingston Marina to go fishing when the boat began taking on water at the stern, North Kitsap Fire & Rescue spokeswoman Michele Laboda said.
He tried to steer the boat back to shore but it started to sink and all three of them were dumped in the water about 50 yards north of the ferry terminal at 8:11 a.m.
The ferry Spokane was approaching the terminal and launched a small rescue boat as North Kitsap Fire and Rescue was responding with its rescue boat.
When rescuers arrived at the capsized boat the man remained but the woman and teenager had already made their way to shore.
The Spokane's boat could not bring the man aboard quickly so the crew towed him a short distance to dry land.
Firefighters met the woman and boy at the beach and waded into the water to help the woman as the cold water made it difficult for her to walk.
The woman and boy were wearing lifejackets but older man was not. The woman was checked out by fire personnel for hypothermia but declined to be transported to a hospital.
The owners of the boat tried with others to turn the boat right-side up but fire officials said they eventually left the scene planning to return Saturday evening when the tide is lower. The boat reportedly has fuel aboard but there is no evidence any is leaking, Laboda said. However, the U.S. Coast Guard and the Washington State Dept. of Ecology both responded to check out the scene.
The man said he was certain the boat's drain plug was in place before he launched and nothing else was unusual.
It was unclear why the boat capsized.