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Sitka delays decision on raw-water sale to Global Hydration after Arctic Blue Waters exercises first-right window
Summary
The Assembly postponed action on a purchase agreement to sell raw water to Global Hydration LLC until March 11, 2025, after Arctic Blue Waters signaled it would exercise its contractual first right of refusal. The city said municipal water needs take priority and it will not execute any new contract until the right-of-refusal period closes.
The Sitka City and Borough Assembly voted 5-0 on Jan. 24 to postpone consideration of a purchase agreement to sell raw, bulk water to Global Hydration LLC until the March 11 meeting, allowing time for a 45-day period tied to a first-right-of-refusal exercised by Arctic Blue Waters.
Gary (identified in meeting materials as affiliated with the industrial park board) introduced the proposed contract and told the Assembly the agreement would initially allow a purchaser to acquire about 2,000,000,000 gallons of water, with options to acquire more once additional fees and certifications were paid. He said the city and borough holds roughly 9.5 billion gallons of water allocated for export annually and that Arctic Blue Waters currently holds contractual first refusal on an additional 6.8 billion gallons.
"By sending that letter, it starts a clock where they now have 45 days to provide the contract and to pay the additional funding that's needed," Gary said, describing the payment timetable and the $100,000 upfront fee and further prorated charges tied to the five-year term.
Assemblymembers stressed that Sitka's municipal drinking-water and hydroelectric needs take priority. "Notwithstanding any other provisions of this agreement, Sitka shall retain first right and priority to water required for its municipal drinking water supply system and its municipal hydroelectric system," the Assembly noted from the contract language presented by staff.
Multiple members said they preferred to wait the 45 days to determine whether Arctic Blue Waters would finalize its additional purchase.
"I don't see any benefit in moving forward with this until we know whether or not it's even a viable option," one Assemblymember said. Another noted Arctic Blue Waters had presented a conceptual loading plan and appeared to be the most advanced bidder so far.
The Assembly motion to postpone the purchase agreement until the March 11 meeting passed 5-0. Staff said if Arctic Blue Waters does not complete its additional purchase within the right-of-refusal window, the Assembly can reconsider the Global Hydration agreement with a fuller packet from staff and the industrial park board.
