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HomeMy WebLinkAboutRES2025-113 Support for Alaska DOT Harbor Facility Grant ProgramSponsored by: Sorensen CITY OF SEWARD, ALASKA RESOLUTION 2025-113 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, IN SUPPORT OF RAISING THE MAXIMUM AVAILABLE ALASKA DEPARTMENT OF TRANSPORTATION HARBOR FACILITY GRANT TO $7,500,000 FOR ELIGIBLE PROJECTS ON AN ANNUAL BASIS WHEREAS, Senate Bill 291 established the Municipal Harbor Facility grant program on July 1, 2006, in which the total amount of grant money made available to a municipality was limited to not exceed $5,000,000 in a fiscal year; and WHEREAS, the Municipal Harbor Facility Grant is the single most significant funding tool available to Alaska harbors to plan, maintain and recapitalize Port and Harbor infrastructure; and WHEREAS, testimony from a legislator advocate stated "SB 291 would establish the municipal harbor facility grant fund to which the Legislature would make an annual appropriation from the watercraft fuel tax account and from the State portion of the fisheries business tax. Both sources come from the marine industry so harbor users would generate the revenue for the program"; and WHEREAS, SB 291 was envisioned to cap the funds that can be used per community per year at $5 million so that a large community can't take all the available funds in any given year. The expectation is that communities would establish, maintain and run an enterprise fund into perpetuity; and WHEREAS, the State of Alaska over the past nearly 30 years has transferred ownership of most of the state-owned harbors, many of which were at or near the end of their service life at the time of transfer to local municipalities; and WHEREAS, these harbor facilities continue to require substantial municipal financial investment to maintain and for capital improvement projects; and WHEREAS, construction, shipping and mobilization costs to remote portions of Alaska have outpaced the national consumer price index (CPI) sirfce the pandemic; and WHEREAS, the United Staes Bureau of Labor.Statistics CPI calculator indicates that $5M in July 2006 when the Senate Bill 291 was enacted would be inflated to $7,500,000 per eligible projects. CITY OF SEWARD, ALASKA RESOLUTION 2025-113 Page 2 of 2 NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, that: Section 1. The City of Seward is in support of raising the maximum available Alaska Department of Transportation Harbor Facility Grant funds from $5,000,000 to $7,500,000 for eligible projects on an annual basis. Section 2. This resolution shall take effect immediately. PASSED AND APPROVED by the City Council of the City of Seward, Alaska this 17th day of November 2025. THE CITY OF SEWARD, ALASKA Sue McClure, Mayor AYES: Barnwell, Crites, Osenga, Calhoon, Draper, McClure NOES: None ABSENT: Warner ABSTAIN: None ATTEST: Kris Peck City Clerk (City Seal) 1 1 1 City Council Agenda Statement Meeting Date: November 17, 2025 To: City Council Through: Kat Sorensen, City Manager From: Tony Seiminski, Harbormaster Subject: Resolution 2025-113: In Support of Raising the Maximum Available Alaska Department of Transportation Harbor Facility Grant to $7,500,000 for Eligible Projects on an Annual Basis Background and justification: The Municipal Harbor Facility Gran Program was established on July 1, 2006 in which the total amount of grant money made available to a municipality was limited and not to exceed $5,000,000 in a fiscal year and be funded through watercraft fuel tax and from the state portion of the fisheries business tax. The grant program was started in response after the State of Alaska transferred responsibility for its state-owned harbors to the local respective municipalities, but many harbors were at the end of their useful life and in need of capital investment. A survey done by the Alaska Municipal League of Ports and Harbors estimated the repair or replacement of the former state-owned harbors has increased to at least $500,000,000. When adjusted from the original amount using the United States Bureau of Labor Statistics CPI calculator to July 2023 this would be inflated to $7,500,000. For FY27 many municipalities have grant applications pending with a total cost to the State of $18,186,535. The grant program has only been fully funded twice since 2006 DOT Grant Program The Grant program was established in order to provide financial assistance to municipal or regional housing authority owned harbor facilities. The Alaska Legislature passed legislation in 2006 that established a new 50/50 matching grant program call the Harbor Facility Grant Program. This grant program is funded on an annual basis at the discretion of the Alaska Legislature an consists of two tiers, Tier I and II. The first tier has priority and consists of major maintenance and repair of a harbor facility that was previously owned by the state and now is locally owned. The second tier consists of all other harbor facilities and those harbor facilities which have already received a Tier I grant. A harbor facility may only receive one Tier I grant but is eligible for multiple Tier II grants. Comprehensive and Strategic Plan Consistency Information This legislation is consistent with (citation listed): Comprehensive Plan: Create a thriving Port of Seward through harbor improvements, infrastructure expansion, and implementation of management plans. Complete the renovation of the Seward Boat Harbor. Reference Alaska Statute 29.60.800 Strategic Plan: Other: rtification of Funds Total amount of funds listed in this legislation: $ 0 This legislation (✓): Creates revenue in the amount of: Creates expenditure in amount of: Creates a savings in the amount of: Has no fiscal impact X Funds are (✓): Budgeted Line item(s): Not budgeted Not applicable X Fund Balance Information Affected Fund (✓): General Boat Harbor Motor Pool X X Available Fund Balance SMIC Parking Other Electric Water Wastewater Healthcare Note: amounts are unaudited Finance Director Signature: X Yes Attorney Signature: Not applicable Comments: Administration Recommendation X Adopt Resolution Other: