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Council discusses Herman Road water main and Herman Road water tower funding amid grant mix
Summary
City staff told the council that a $6.6 million construction estimate covers a water main extension, a well, a 1,000,000‑gallon reservoir and pump house; council members discussed phasing, ARPA and borough grant funds and remaining funding gaps for the water tower project.
City staff and council members spent extensive time on May 27 reviewing the Herman Road water main, new well, pump house and proposed water tower as part of the FY26 budget amendments.
Eric (city staff) told council members the full package — water main extension, a new well, a 1,000,000‑gallon reservoir and pump house — has a working construction estimate of roughly $6,600,000 excluding contingency and administration. He described a phased approach: ARPA and borough designated legislative grant monies will start construction work on the water main extension, but additional funding is needed to complete the water tower and pump house.
Council discussion centered on funding breakdowns and phasing. Staff reported existing account balances including roughly $1.7 million already appropriated, and noted separate grant encumbrances (about $1.8M to $2.1M) that had been awarded for interconnect and booster station work. Staff said some of the borough grant dollars are constrained to interconnect work and recent re‑scoping moved funds to Herman Road projects based on engineering needs.
Staff also said the construction estimate includes about $660,000 for geotechnical work and roughly another 8% for construction administration; contingency pushes the working total to about $6.5–6.6 million. Council members asked staff to return with final funding requests and timelines to start construction; staff recommended continuing with design now so the city can return with a firm funding request for construction.
Separately, City utilities staff described East Susitna booster/pressure issues and arsenic‑treatment challenges in the system; John Becker, utilities supervisor, said two wells exceed the arsenic limit and are currently run on a limited cycle while the system blends sources to stay within regulatory thresholds. The council asked for additional information on arsenic‑treatment options and life‑cycle costs and for phasing to prioritize pressure improvements for undeveloped parcels near the East Susitna tank.
