Anchorage Assembly members are considering whether to spend $100,000 to hire an independent analyst to monitor an ongoing modernization project at the Port of Alaska.
The entire project is estimated to cost more than $1.9 billion. Assemblyman Chris Constant, co-chair of the Assembly Enterprise and Utility Oversight Committee, said the shock of the latest cost estimate led to a moment of clarity: now, he said, lawmakers hoped an independent analysis could help assess their options moving forward.
“Our intent at this point is to look really closely at all of those parts, determine what’s really essential for moving forward, then come up with some rational cost analysis to to figure out what we’re going to build, who’s going to pay for it and when it’s going to happen,” Constant said.
Paying for repairs at the Port of Alaska could involve a combination of sources. The facility handles goods for 85 percent of Alaskans as well as vital jet fuel for Joint Base Elmendorf-Richardson, and lawmakers and Port officials say funding its renovation could include local, state and federal funds. Port customers could face steep tariff increases.
On March 15, Enterprise and Utility Oversight Committee members met with local business representatives to learn more about how those increases could ripple throughout the state’s economy. In a letter to Assembly members, Petro Star, a subsidiary of Arctic Slope Regional Corporation, said hiking Port tariffs by more than 500 percent would cause “irreparable harm.” Representatives for shipping companies and fuel distributors said increased tariffs would impact everything from air cargo traffic to grocery prices.
Ryan Zins, Vice President of Alaska Basic Industries, told Assembly members how increased tariffs could raise costs for construction projects around the state. His company, which imports cement and other building materials, operates out of the port’s aging cement terminal. Zins said he knows it needs to be fixed. But how much of the cost could the community afford?
“That’s the hard thing, is they ask, ‘What is the amount of tariff that you can absorb?’ Well the answer to that is zero, I mean, we’re in a fourth year recession,’” Zins said. “But we understand something has to be done. So before we get into that discussion, how much is this project truly going to cost?”
That’s the question some Assembly members are now hoping to answer. Before moving forward with hundreds of millions of dollars in construction work, the Assembly plans to vote Tuesday night on a resolution to spend $100,000 on a third-party analyst to take another hard look at the project.
“If you take a step forward, we may be stuck,” Constant said. “So before we take that step we’re going to make damn sure we know what we’re doing.”