My guess is it's the EZ blue washout pencil:
http://www.amazon.com/Pencil-Washout...dp/B0018N932Y/

Blue and yellow seem to be two colors that quilters run into problems with when it comes to chalk......

I had that happen once, and I sprayed all the lines with Spray n Wash, while it was still wet from the first washing, and the marks came out.

Ok, just wanted to thank everyone for all the suggestions. The blue chalk marks are from a "Blue Washout Pencil" (that's the actual name). If I remember correctly, I bought it at Walmart. I will never use these chalk pencils again! In the past I have used sidewalk chalk, and I will be going back to it when I start my next quilt. I came up with a concoction that seems to be working. In a spray bottle I mixed about a cup of white vinegar, filled the rest of the bottle with water, and added a good squeeze of Joy dish soap. I sprayed all the blue marks and rubbed it with a bar of Ivory soap. I let it soak in cold water. I am now going to wash in Tide and pray it comes out. This will be the 4th wash and each time it has gotten lighter. Hopefully, this is the final wash ! I will keep you all posted! (PS the marks are on white and light yellow boarders!)

Oh, I sure hope it all comes out!!!!!

I heard Mr. Clean Erasers removes even pencil marks; however, I have never tried it yet.

I use a bar of Fels-Naptha. Get it at walmart about $1.00. DAMPEN the corner of the bar and gently go over the marks. It'll come right off. I use this for any stain. Hasn't failed me yet. Hope this works for you

It also happened to me only I used a green chalk. After several washing s it still didn't come out. Luckily they were stars that I had quilted on the borders and throughout the quilt. I decided to go over them with yellow chalk and made it look like I stitched them in yellow. I never use chalk anymore. Good luck!

Well I hope that the markings have come out.

I try to be careful with those disappearing or washout markers- i used one of them to mark the center of an embroidery project years ago. The marks disappeared, but came back several times. Granted, i may not have removed the marks with plain water, i dont remember, but it is so frustrating when you trust that they will perform as expected and then dont. I hope that this comes to a positve conclusion for you.

I am so sorry! I cannot even imagine how you must feel! I wish I had words of wisdom regarding the blue pencils but I do not. I pray with all my heart you get them removed. Will you let us know the final outcome.