The borough has been preparing to make costly updates to its wastewater treatment plant, but recent estimates suggest that the multimillion-dollar project could be over twice as expensive as anticipated.
Late last year, borough officials placed the project in the $3 million to $5 million range; the new price tag is over $12.5 million.
“This is considerably more than what we were planning on,” said Borough Manager Jeff Good. Construction costs are rising nationwide and the borough has had to adjust estimates on many major projects accordingly, but he still “wasn’t expecting that amount.”
The $12.5 million is “a very, very initial, rough cost estimate,” said Public Works Director Tom Wetor, still subject to change as engineers nail down the details. “We haven’t actually had (the engineering company) here on the ground. They basically reviewed our plans and looked at what’s happening in the industry.”
The U.S. Environmental Protection Agency and state Department of Environmental Conservation are requiring municipalities throughout Southeast to bring the wastewater that they discharge into the ocean into compliance with current environmental standards.
In the past, Wrangell and eight other Alaska communities had waivers that allowed them to discharge wastewater without disinfecting it — the rationale was that in marine environments, the waste can be diluted quickly.
But federal and state agencies are now revisiting these waivers. Wrangell will need to add a disinfection process to wastewater before discharging it into Zimovia Strait.
Disinfection options include ultraviolet light and chlorine. “Chlorine seems to be the leading method right now,” explained Wetor, because it removes ammonia, whereas ultraviolet light does not. The recent cost estimate is for chlorine disinfection.
However, these agencies don’t provide funding to carry out these mandated improvements, so the borough will have to figure out a way to cover the project.
Good hopes to get funding through the Environmental Protection Agency, the U.S. Department of Agriculture or the Army Corps of Engineers. However, these federal agencies operate on a two-year budget cycle, meaning it will be a long time before the borough could receive money from them.
And the disinfection project can’t wait long. Wrangell has five years to get the wastewater plant updated and operational under the new standards.
Congressional directed spending, also known as “earmarks,” could provide a funding source while the borough waits on a federal grant. Earmarks are funds provided by Congress for certain local projects, though they can be controversial and hard to get.
“We’re pursuing both avenues,” Good said of directed spending and grants.
Sen. Lisa Murkowski directed $13 million to Anchorage for a wastewater disposal project for the fiscal year 2023, and last year directed $2 million to Wrangell to help pay for a new pipeline at the community reservoir.
Good has already reached out to the state’s congressional delegation to ask for support. Borough officials won’t know until Oct. 1 at the earliest, the start of the federal fiscal year, whether the project will receive directed funds.
“We’re going to need some grant funding to be able to afford it,” said Good. “Even at a very low interest rate, a loan to be able to do that, that’s going to be a heavy burden on our ratepayer.”
Wrangell ratepayers have already been hit with steep increases. The borough raised sewage rates 21% in the summer of 2022 after seven years without adjusting them. Rates will increase an additional 15% starting July 1.
“If we did receive additional … grant funding, we would like to keep the rates where they’re at,” said Good. “That’s our goal.”
Wetor agrees that improving water quality is a worthwhile goal, “but this is a huge expense, especially with everything that’s happened over the last few years, for us to absorb,” he said.
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