Despite the scanty state spending expected in 2016, this year’s state capital budget may provide funding for long-deferred upgrades to Kenai’s wastewater treatment plant.

Built in 1981, Kenai’s wastewater plant discharges into Cook Inlet from an outlet in the Kenai beach mudflats. The ammonia in this discharge exceeds the plant’s August 2015 permit from the Alaska Department of Environmental Conservation, which allows Kenai five years to bring the plant to the ammonia emission limits.

Kenai has tried for the last three years to secure state funding for wastewater plant upgrades — which Kenai City Manager Rick Koch said Kenai can not afford to fund on its own — through a DEC grant program that gives money to cities for drinking water, water conservation, and sewage projects, awarding funds through a competitive application process. This year, the violation may have made a critical difference for Kenai. Gov. Bill Walker’s Dec. 15 draft capital budget gives $1,019,287 to Kenai’s sewage plant.

“There’s kind of a double-edged sword on that violation,” said Mike Lewis, DEC’s program manager for the Municipal Matching Grant. “We give them extra points on that, but we do take a little bit away because they are operating without compliance. But if they show that they’re trying to do something to move forward with it, they’ll get enough points to override that criteria. … If there’s an issue and the community’s not doing anything, then they’d probably be hurt more by not being in compliance and not doing anything about it.”

Kenai ranked high among the applicants, but its proposal was enrolled in a shrinking program. From giving out a $33 million appropriation in 2012, the DEC grant had dwindled to giving $14.5 million in 2014, and in 2015 only gave out $7.5 million. This year’s grant is set to distribute $4.1 million, although Kenai Finance Director Terry Eubank said it was uncertain whether it would give any money at all.

“… It was surprising that money was put into the program,” Eubank said. “The city scored very well, so if any money was put into the program, the city was in a very good position to receive a grant. Whether or not money was going to be put in was the iffy part.”

The funding this year’s draft budget puts into the DEC grant doesn’t come from a new allocation by the state, but from leftover money taken from 32 completed DEC grant projects in other Alaska municipalities. In addition to the Kenai sewage plant, wastewater plants in three other municipalities — Sitka, Haines, and Ketchikan — will be funded with about $1 million each, and $731,236 will be spent to replace a water main in Wrangell.

Funding for the wastewater refurbishment will include a 30 percent match from Kenai — $436,837. Koch said the money will be spent first determining how to eliminate the excess ammonia, and second on upgrades that will make the plant more energy efficient.

Before the ammonia level can be reduced, Kenai’s consultant C2HM Hill will have to discover its source.

“A lot of stuff makes ammonia, so we don’t have a great idea of where it’s coming from, but this process will figure it out,” Koch said. “Part of what the consultant will do is do testing at critical places throughout the system at different times, to see if we’re picking up ammonia from a certain area.”

Koch said one source of the ammonia may be the plant’s digester, a component that breaks down incoming sewage, which he said hadn’t been cleaned in 25 years because the plant has been unable to take it out of use.

“We’ve only got one,” Koch said. “It’s working, but like any component in a mechanical process, there’s a time when you’ve got to take it offline and clean it out. We’re probably past due that.”

One job that will be funded by the state grant will be configuring an aeration basin to function as a digester while the digester is shut down for cleaning. Other tasks will be the installation of variable pumps, which can vary the pressure they put out, resulting in an energy savings Koch estimates at around $100,000 a year.

Approval for DEC’s grant funding still needs to pass through the Legislature, which may vote to reduce or eliminate it.

“I would be surprised if they got desperate enough to reach into here for this $4 million provided in this re-appropriation,” Koch said.

Eubank was also hopeful, describing the plant upgrades as a “win-win” proposition that would both reduce environmental impacts and save the city long-term spending.

“At the end of it we’ll have a more efficient plant that can meet the more stringent guidelines we have to operate under now,” Eubank said.

Reach Ben Boettger at ben.boettger@peninsulaclarion.com.