The Whitman Dam hydroelectric project isn’t dead yet.

The Ketchikan City Council decided Thursday to delay making a decision on the fate of the project, which – after 25 years of planning – ended up with construction bids about $12 million over the engineer’s estimate.

While some Council members said their initial reaction was to scrap the project, they all agreed to give city managers and project officials three weeks to look into options. The Council will meet Aug. 28th in special session to learn what those options might be.

Council Member DeAnn Karlson said the city shouldn’t make a quick decision to abandon the project.

“I think that we really owe it to the community to really take the time to look into it and get some more answers,” she said. “There’s been a lot of time, effort and money invested into this project to date and I just think it really behooves us to take some time to really understand the options, and investigate whatever options might be available, because these are really serious decisions that have to be made.”

Council Member Matt Olsen questioned the validity of the engineer’s estimate from Hatch Associates.

“I was telling Marty earlier, I kinda feel like the general manager who just signed the star pitcher, and he just blew out his elbow, both knees and got an achilles tendon injury,” he said. “This is terrible. I look at this and I have some issues with what Hatch is doing. I have some real questions about how we can proceed with this group doing it. And I know we’re way down the line, but I have a serious question about that.”

Hatch engineers blamed much of the cost discrepancy on the rising cost of steel and a rerouted access road.

The estimate for Whitman was about $14.3 million. The lowest bid, submitted by Ketchikan’s Dawson Construction, was $26.4 million. Hatch and Dawson came up with a rough plan to reduce the scope of the project, in hopes of bringing it down to the approved budget.

The revised plan would delete the larger of the two generators at the dam. Removing that unit also would eliminate the need for some related items, such as diverting the nearby Achilles Creek.

However, it also would reduce the dam’s power output. Originally Whitman was expected to add 4,600 kilowatts of capacity. That would drop to 700.
City Manager Karl Amylon said the city will find out whether the federal license deadline can be extended.

“One of the first calls we’re going to be making (Friday) will be to FERC to have an in-depth discussion about what constitutes meeting their threshold,” he said. “If there’s any way, and I’m not saying there is – I don’t want to mislead anyone – but if there’s any way around that March 16, 2013 deadline, that opens up a whole lot more in terms of the possibilities that may be out there relative to keeping the project as envisioned – the 4.6 megawatt project.”

To build the dam, the city obtained a license from the Federal Energy Regulatory Commission. That license requires construction to begin by March 16.

According to KCAW radio in Sitka, Hatch also underestimated construction costs for Sitka’s Blue Lake hydro expansion. The estimate was between $45 and $50 million dollars. But when bids were opened Tuesday, the lowest was more than $84 million dollars.

Also on Thursday, the Ketchikan City Council opted to maintain the approved funding formula for nonprofit grants.

A motion by Council Member Marty West would have increased the percentage of sales tax designated for nonprofits from 3.24 percent to 4 percent. That motion failed, though, with West, Olsen and Karlson voting in favor.

Earlier, Ketchikan Area Arts and Humanities Council Director Kathleen Light requested the 4 percent funding level. She told the Council that popular events such as Saturday’s Blueberry Arts Festival are organized by local nonprofit groups.

“It is an increase in funding over 2012 of about 23,500, but it will allow you to provide for the health and vibrancy of your nonprofits in your community and the growth of those nonprofits, which is so important to our community,” she said.

Mayor Lew Williams III suggested that the city consider changes to the program, such as limiting new applications for grant funds, and stipulating what kind of activities for which the grants should be used.

The next Ketchikan City Council meeting is a special meeting starting at 7 p.m. Tuesday in City Council chambers. The Council will discuss cost-of-service studies for planned capital improvement projects.