New state policy puts hiccup in city trail plans

Jun 23, 2020

The cities of Kenai and Soldotna each have local trail improvement projects in the works for this year, but a change in state policy has thrown wrenches into them.

Kenai is planning to build a paved bike path between the junction of the Kenai Spur Highway and Bridge Access Road down to Beaver Loop Road. This would connect to the newly paved separate bike path along Beaver Loop, creating a completely separated bike path loop between Kenai and Beaver Loop. Soldotna is planning to pave paths in Soldotna Creek Park and expand a path along Homestead Lane toward Swiftwater Campground.

These are largely paid for through federal passthrough grants called the Alaska Transportation Alternatives Program, or ATAP. The funds require a local match, and historically, the state has passed the money along to the cities to administer themselves.

But earlier this year, the state DOT announced that it would reinterpret how it administers those grants, shifting to designing and implementing the projects itself instead of allowing municipalities to do it themselves. A white paper issued by the DOT in February says the grant model, in which the money was passed to municipalities, exposes the state to risk and high overhead costs.

The white paper also says the shift will minimize costs and risks and lower the match amount for municipalities to about 9 percent. The state says it began working on the change a few years ago and let applicants in the last cycle know that it wouldn’t be a grant program anymore.

The problem is that the cost so far has gone up for municipalities. The original estimate for Kenai’s bike path project on the grant application was about $800,000. When the grant was awarded, the state estimated the total cost at $1.4 million, with a local match of $126,420.

But the most recent updated cost estimate from DOT for the same project was about $2.18 million, making the city of Kenai’s match rise to about $216,000. City Manager Paul Ostrander said the cost could be lower if DOT allowed the city to do it.

“One of the biggest concerns we have is the administrative decision by DOT not to allow local governmental entities to manage projects,” he said. "The city has the resources and the experience and the financial controls to administer this project according to the standards and the procedural requirements of the (Federal Highways Administration) and we’re confident we can do it at a much lower cost.”

The ATAP money is federal, which means the project it’s used for has to comply with federal rules. Ostrander said the city has done these projects in the past and can do them to federal requirements. But the state’s design and planning phase is a major portion of the expense. The city is also concerned about the future maintenance.

"We are required to commit to maintaining this bike path going forward," he said. "So to not have the ability to manage the project on a facility that we're going to have to maintain long-term also concerns us."

Soldotna is still working on its project. The Kenai City Council has introduced an ordinance to appropriate the match funds for the bike path project and will have a public hearing on it in July. The match funds in Kenai will come out of the Daubenspeck family fund, which is dedicated to athletics and parks in the city.

Reach Elizabeth Earl at eearl@kdll.org.