Port of Nome expansion project on ice as Corps cancels call for contractor bids

The proposed expansion of the port of Nome is not going forward as expected.  The U.S. Army Corps of Engineers has canceled its solicitation of contract bids for Phase One of the project on Wednesday, Oct. 16.

Reasons given for the cancelation were that the pricing exceeds “statutory cost limitations” and that costs surpass the available funding for the project.

Asked for comment, Port Project Manager Joy Baker said the Corps had no information to share with the City of Nome, its project partner.

Spokesperson for the Corps John Budnik said in a statement that the Corps remains fully committed to awarding a construction contract for the Port of Nome Modification Project. "However, we recently had to cancel the phase 1 contract solicitation because pricing was well above our statutory limit. Our Congressional delegation, along with the City of Nome and the State of Alaska, successfully secured funding for this vital project benefitting the region and the nation through the Bipartisan Infrastructure Law, and the U.S. Army Corps of Engineers – Alaska District will aggressively pursue its safe construction to our high-quality standards, while being good stewards of taxpayer dollars."

Senator Dan Sullivan, when asked by Nugget reporter Anna Lionas for comment on this new development said his office was not informed of the Corps' decision, but that his office remains focused on pursuing the port expansion.

The statement from the Corps furthermore said that the Corps' Alaska District team is working In partnership with the City of Nome, and the entire USACE enterprise "to quickly pivot to several other options for bringing the benefits of the Port of Nome Modification Project to the state.  It is our highest priority to ensure the statewide economic and security benefits of this project are implemented."

"While we are bound by the limits of the Procurement Integrity Act and Federal Acquisition Regulations, USACE will continue to diligently work to bring this project to a successful contract award as quickly as possible," the Corps' statement concludes. "The Alaska District has a proven history of delivering complex projects throughout all of Alaska and we expect to deliver the same success at Nome."

The Port of Nome modification project Phase One was projected to begin next summer. Work included the dismantling of the spur at the current causeway and to extend the causeway by 3,500 linear feet into the deep-water basin. Phase Two was to dredge the outer basin to minus 40-ft and Phase Three was to remove the eastern breakwater and construct a new causeway further east.

“The construction project aims to provide larger vessels improved access to Nome’s existing harbor by enlarging the outer basin and creating a new deep-water basin with a depth of minus 40 feet,” according to planning documents.

The Corps and the City signed a partnership agreement in January of this year, which pegged the costs of the entire project at $662,569 million. The federal portion of the costs were projected to be $596,312 million, and the city’s portion were a projected $66,257 million. Additional costs were pegged at $244,423 million.

Congress allocated $250 million to the U.S. Army Corps of Engineers for the project in December 2020; in 2022 the Alaska Legislature allocated $175 million for the City of Nome's cost obligations for the port expansion.

Note: this article was updated on Oct. 18 to reflect the Army Corps' comment.

With reporting from Anna Lionas, from AFN in Anchorage.