Alaska Department of Transportation officials say massive increases in the cost of the Cooper Landing bypass project are driving the agency to seek alternative sources of funding, and readjust the work schedule over the next several years.
The bypass — officially the Sterling Highway Milepost 45-60 project — is a decades-old plan to divert traffic around Cooper Landing by creating a highway bypass through the mountains north of the town. It includes miles of new highway, plus a bridge over Juneau Creek Canyon that will be the longest single-span bridge in the state, and highest crossing, when complete.
In June, the project’s manager expressed concerns about its funding, pointing to a lack of money in the state legislative budget and suggesting the completion date could be delayed.
Shannon McCarthy, a spokesperson for DOT said, dramatically rising costs have caused concerns about funding the project. Although work is currently moving forward, the costs could delay the completion of the project by at least two years, or as many as four, according to the project's manager.
McCarthy said the project was originally estimated to be a $350 million endeavor in 2018. By 2021 that number was closer to $500 million, by 2022 it had risen to almost $700 million. A new assessment this year shows the current cost to be $840 million, almost two-and-a-half times the original price tag.
McCarthy said DOT attributes the cost increase to inflation, but said the agency is also going to take another look at the latest financial analysis to make sure it’s a reasonable estimation.
“We’ll have to take a look at that and see, just confirm, are we doing this the right way, have we added something in that we don’t need to,” she said.
McCarthy said DOT is now turning to outside sources to make up those increases.
“When Congress passed the Infrastructure Investment in Jobs Act, they created a number of competitive grant opportunities, and one of them is called the Mega Program,” she said. “And this is the one which supports these really large, complex projects that are difficult to fund in other ways. So it’s kind of tailor-made for a Cooper Landing bypass project.”
She said the department plans to apply for that, and other grants. It’s also reorganizing the schedule for the project to work around those cost issues, by pushing one leg of the project scheduled for next year.
“Because of the cost increases, we are going to have to think about spreading the phases out a little more than we originally had wanted. But it is moving forward, and we are going to pursue this alternate funding in hopes of securing that last bit that we need, and still not impact other projects statewide,” she said.
The plan for the next year was to begin work on the bridge over Juneau Creek Canyon, as well as another leg of the highway. But McCarthy said now, with rising costs, it’s not realistic to work concurrently on those parts of the bypass — together, their costs would have been roughly equivalent to DOT’s yearly budget for the whole state, so moving forward on that work would cause delays across Alaska.
“We’re really aiming to build that final leg in 2027, and that gives us a little bit of time to pursue that funding that’s outside of the state’s annual allocation,” McCarthy said.
Information about the new cost estimates and timeline are included in the department's new Statewide Transportation Infrastructure Program, a four-year spending plan for the allotment of federal money in state highway projects. The plan is currently in draft form, and is open for public comment through Sept. 3.
McCarthy said design work is wrapping up on the bridge this summer, and construction should begin in 2024.
Correction: A previous version of this article stated that cost increases would not cause delays in the completion date of the project. The article has been corrected to clarify that while work is moving forward on the project, it is not expected to open to traffic in 2027 as originally scheduled.
