Mat-Su, feds reach $5.8 million repayment deal for failed Knik Arm ferry project

image from: alaskapublic.org

PALMER — The Matanuska-Susitna Borough will repay nearly $5.8 million in federal grants through installments between now and September 2029, a step that should finally put to rest the financial consequences of the defunct Knik Arm ferry project.

The payments refund a portion of the $12.3 million in grants the borough received between 2002 and 2008 to create infrastructure for the M/V Susitna, including a ferry terminal at Port MacKenzie now used as borough office space. Federal transit officials in August renewed their effort to recoup the funds after nearly a decade of silence on the matter.

The borough will repay $1.5 million by mid-March, then about $1.07 million by Sept. 30 each year until the debt is fully settled in 2029, according to a payment plan approved by federal officials Jan. 14. The payments will not be subject to interest or penalties, and the borough can repay early if officials choose to do so, according to the plan.

The $5.76 million in repayments should fully close the book on repercussions to the borough and its taxpayers for the failed commuter-ferry project.

(READ MORE - alaskapublic.org)