Refurbished Port of Anchorage cost estimated at $485M

Rendering/Courtesy/Municipality of Anchorage

It will likely cost nearly another half a billion dollars to upgrade the Port of Anchorage according to the project managers.

The Anchorage Port Modernization Project team revealed its concept design selection to Anchorage Assembly members at a Nov. 21 work session.

“This is an out-the-door cost; it’s everything,” CH2M Hill project lead Lon Elledge told the Assembly.

Selected by Mayor Dan Sullivan and the Assembly last spring, engineering and consulting giant CH2M Hill is the latest management firm for the port construction project.

The U.S. Maritime Administration, or MARAD, led the previous iteration, the Port of Anchorage Intermodal Expansion Project, for nine years. The municipality cut ties with MARAD in 2012 after major construction damage was discovered. No significant work has been done to Alaska’s largest marine hub since 2010.

 The group of CH2M Hill project and port leaders said the concept design was selected unanimously — one of four that came out of a weeklong design charette with stakeholders held in August.

Done to high-level, 15 percent completion, the project team has a 60 percent confidence that the overall cost will come in under $461 million and is completely confident it can be done for less than $628 million, Elledge said.

The cost estimates are based on construction beginning in 2016. With full funding it would be finished in 2022, he said, nearly 20 years after work began.

Port Engineer Todd Cowles said the main goal of the new project is simple.

“We’re focusing on our existing business and expansion of that business,” Cowles said.

At more than 50 years old, the steel piles that support the dock structures are badly corroded. The port spends more than $1 million per year maintaining them.

The latest design uses traditional pile-supported docks and eliminates the sheet pile used in the earlier design.

At $485 million, the municipality would need to secure an additional $355 million; it has about $130 million remaining from prior funding.

Since 2002, nearly $439 million of municipal, state and federal money has gone towards Port of Anchorage construction and a little more than $300 million of that has been spent.

The State of Alaska contributed $220 million in bonds and direct appropriations through 2012.

Sullivan said in an interview the state would be the focal point of the municipality’s hunt for additional funding, but also said federal transportation loans and the Defense Department could be other options. The Port of Anchorage is listed as a strategic port by the Department of Defense, a factor that has played into some design considerations.

He noted that the port benefits all of Alaska — roughly 85 percent of goods to the state enter through the Port of Anchorage — and that the municipality has already financed $80 million of work.

As oil prices fall and the state budget situation worsens, Sullivan said he is aware large direct appropriations will be hard to come by.

“Remember, the state and the municipality still have AAA bond ratings,” he said.

Incoming Gov. Bill Walker has said repeatedly he would focus on finishing important infrastructure projects across the state rather than starting new ones.

If there is one that needs to be finished, it’s the Port of Anchorage.

All of the designs remove nearly half of the 35-acre North Extension backlands created during construction of the earlier, discontinued project. Cutting back the filled area will allow for more direct current flow past the existing and future port terminals and subsequently improve scouring, which would reduce some of the need for dredging.

The U.S. Army Corps of Engineers spends up to $10 million per year to dredge the area around the Port of Anchorage.

After cutting the North Extension, Phase 1 of the project entails demolishing the port administration building, which currently sits near the water and the main terminals, and building a new one near the security office. It also includes construction of a new point of loading, or POL, dock at the southern end of the port near the cement area.

Phase 2 would involve filling a small area behind Terminal 1 and moving Terminal 1 out to where a depth of 45 feet can be achieved.

The current dock is at roughly 35 feet.

During phases three through five terminals two and three would be demolished and subsequently pushed out 100 feet or more to be in line with Terminal 1.

The port’s main tenants, Totem Ocean Trailer Express and Horizon Lines, would be moved just once under the concept, a big advantage to it, the team members said.

“(The concept) gets a thumbs up from us,” TOTE Alaska Director George Lowery said.

In the final phase, existing POL 2 would be pushed out to be in congruence with the other terminals.

When CH2M Hill was selected as project manager Sullivan said the company would not be involved in new designs.

CH2M Hill, which conducted the study that found the sheet pile design unsuitable for the port and led to lawsuits against former project players, will lead design to the 35 percent level. That work should be done by May 2015.

From there a design-build team will be secured over the summer and the final design elements will be developed. CH2M Hill will not be the designer of record, Sullivan said.

Environmental permits from the previous project will have expired by the time construction starts and will have to be secured as well.

Elwood Brehmer can be reached at elwood.brehmer[email protected].

Updated: 
11/18/2016 - 10:25am

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