Homer Alaska - News

No matter which way the U.S. Army Corps of Engineers pencils it out, it just can't make the benefits of a harbor expansion in Homer outweigh the costs.

What that means is a little less straightforward than it would appear.

Sure, new harbor facilities would bring in cash for Homer, but on a national scale the project isn't up to snuff.

Patrick Fitzgerald, a planner with the Alaska District of the Corps, said during his presentation to the Homer City Council on March 8, "What's hurting us is the cost of rock, and that's a problem around the state."

With rock driving up the costs of construction, the efficiency of the current harbor facilities is keeping the benefit side of the harbor expansion equation down.

On a national scale, the benefit of a new project, like a harbor, is measured by the potential difference in efficiency from what is already being used.

For example, Fitzgerald used the difference between how efficiently Homer's commercial fishing industry runs in the current facilities versus potential gains in efficiency with an expanded harbor.

The problem is that Homer is already highly efficient, so the potential difference in efficiency is much smaller than it could be if the same project were designed for a smaller community with a less efficient harbor.

The big question the Homer City Council faced at its Monday meeting: What does the city do now?

There are alternative routes for the city to take, if it really wants to get behind building a new harbor or expanding the existing harbor.

The best route, said Fitzgerald, is to get the state or the federal government to specifically authorize the project.

So far, the corps and Alaska Department of Transportation have used about 70 percent of the original $1.5 million allocated to study the project. That amount included federal, state and local funds.

Fitzgerald urged the council to consider putting the remaining funds into creating a technical report that the city could use in seeking specific authorization.

"I can't think of a single harbor that the corps has built in Alaska that wasn't specifically authorized. If we can prepare some type of document like this technical report, it gives you a lot of credence," said Fitzgerald.

False Pass, St. Paul, Chignik, Sand Point, King Cove and Wrangell have all recently built harbor facilities through specific authorization.

Fitzgerald estimated the cost of a technical report to come in at approximately $104,000.

Harbormaster Bryan Hawkins commented that most projects the federal government has been authorizing lately have had a cost benefit ratio of 2 to 1, meaning the government would make money on its investment.

The ratio for each alternative that Fitzgerald outlined hovered at a ratio of around 0.3 to 1.

Council member Barb Howard asked, "Is there any hope?"

Fitzgerald said Homer's best hope would be to go after the project on its own, even if the corps couldn't recommend it.

"Aside from the port of Anchorage we have no large projects to build so the administration is not very kind to the corps in Alaska, which is why communities usually go to Congress individually," said Fitzgerald.

The next step, said Homer City Manager Walt Wrede, will be to talk about how to proceed.

"I think the technical report would be the next step, but that's one of the questions that the council is going to have to look at," said Wrede.

Wrede also pointed out that having a second look through an independent study might leave the cost benefit ratio a little closer to positive.

The one thing that both Wrede and Hawkins hope to avoid is letting all the data and research that the corps has done, and the money it took to do it, go to waste.

Hawkins said that one of the best chances the council has to get something for its money out of the project would be to go after the technical report that Fitzgerald suggested.

"The thing about a technical report is that if down the road the political climate changes and funding opens up or the industry opens up, then we can pick this technical report up and start from that level; from year five instead of year one," said Hawkins.

While both Wrede and Hawkins agree that projects with a negative cost benefit ratio do get funded regularly, it is by no means a foregone conclusion, even with a technical report that the city could leverage while looking for funding.

"Right now it's a tough one to fund because earmarks have been falling out of favor," Wrede said.

"You'd have to get it into the president's budget and you'd need a much better cost benefit ratio to get it in that budget."

Over the coming weeks the council will look not just at going after the technical report, but potentially at an independent study and means of making both the cost of construction cheaper and the benefit of a new harbor or harbor expansion greater.

"After all of this time the answer right now is no. That's really not the answer we want. I laugh at myself because I'm kind of frustrated, but I'm only frustrated because I didn't get the answer we want," said Hawkins.

Robert Hartley with the Port and Harbor Commission said, "I think we'd like to see something done, but it has to be a practical thing, too."

Hartley noted that the Port and Harbor Commission would discuss the harbor expansion at its next meeting on March 31.