Wrangell benefits from high oil prices

It’s looking increasingly hopeful that Wrangell will receive $4.1 million as a state grant toward a new water treatment plant.

While not exactly a gift from heaven, it feels like a blessing nonetheless. Without the state funding for the $15-plus-million project, the borough would face the financially painful option of borrowing money for the needed water plant.

The borough already has $11 million in assembled federal funds, which is a solid start, but that last $4 million or so could come at a hefty price to water utility ratepayers if Wrangell has to sell bonds to raise the money. Borough officials estimate paying back the debt could add almost 30% to water bills, pushing the rate for many residential accounts close to $80 a month.

The community should know next week if the Wrangell grant added to the state budget in the House Finance Committee last week and in the Senate on Monday survives the final week of House and Senate negotiations over their merged spending plan for next year. The water plant money also would need to get past the governor’s veto pen, which he has used in past years but he may be less inclined to start crossing out community projects this year during his reelection campaign.

And while borough officials, the community’s lobbyist in Juneau and Wrangell’s state legislators — Rep. Dan Ortiz and Sen. Bert Stedman — put a lot of work into getting the request this far, residents should remember the big reason it’s even possible to get money from the state this year for community public works projects: High oil prices.

Those same high prices that have made gasoline and diesel so expensive have plumped up the state treasury fatter than a Butterball turkey at Thanksgiving.

Legislators are looking at using some of that oil money to distribute payments to Alaskans this fall more than twice the size of last year’s Permanent Fund dividend check. Lawmakers also have added money to the budget for schools — desperately needed for Wrangell — as they work to undo at least some of the years of cuts to services from roads to state ferries to education and children’s services.

In addition, and this is where the water treatment plant money can be found, the Legislature is working to finish assembling the largest public works bill in years — called the capital budget. A long stretch of low oil prices forced legislators and governors to significantly scale back money for new construction and maintenance across Alaska. This year’s $100-plus oil is paying to dig into that backlog.

Which means grouse and grumble at the price you pay at the pump or when you get your heating oil tank filled for next winter. Just remember those same high prices could help provide the community with a new water treatment plant.

— Wrangell Sentinel