City council moved to shift more than $4 million in funds from the water treatment facility project to the powerhouse project at their meeting last night.

The change would come after council accepts a loan from the Alaska Department of Environmental Conservation. It’s part of a budget amendment that got a first reading last night.

City Manager Chris Hladick says the ADEC would give the city a $5 million loan at a 1.5 percent interest rate. If the city uses the full loan, they get an extra $1 million as a subsidy that Hladick says is basically a grant.

This frees up city money from the water treatment project to go toward the fourth engine at the powerhouse. The city requested money from the state for that project, but Hladick isn’t optimistic they’ll get it.

"Moving this money to the powerhouse gives us a plan B in the event we don’t get any money out of the legislature, which is highly likely," he says.

He says the fourth engine is currently being shipped to Unalaska.

The budget amendment addressing both projects was moved to a public hearing and second reading at council’s next meeting on April 8. The amendment also includes a request for extra funds for the Summer Bay Bridge replacement project, which should start by July.

Also moved to a second reading and public hearing April 8: an ordinance changing wharfage fees at the Carl E. Moses Small Boat Harbor. Right now, users have to pay a high minimum fee based on the tariff at the city dock. But Ports Director Peggy McLaughlin says the Carl E. Moses float is designed and used for far smaller loads than the city dock.

The ordinance changing the fees would mean vessels would pay to on- and off-load cargo at the float on a per-ton basis. McLaughlin says this won’t have an impact on revenue, but it will encourage more vessels to use the float.

Council also passed a resolution amending this year’s paving project budget to include $1.5 million for work on Biorka Drive. Hladick says the price includes $1 million to pave 0.6 miles of the road, and $500,000 to install a sewer main along the road. Knik Construction will do the work, along with other paving projects around town.

Mayor Shirley Marquardt was skeptical about what she calls a high price for a short amount of roadway, considering Knik already has a presence in town. But the resolution passed unanimously.

A resolution to lease tidelands on the southwestern face of Little South America to the Ounalashka Corporation was scratched from last night’s agenda. Marquardt says the removal came at O.C.’s request.

Also last night, council approved a city surplus property sale that will take place on April 5.

Public Safety Director Jamie Sunderland also talked about the city’s upcoming emergency drills set for March 27. They’re part of Alaska Shield, a statewide exercise that takes place every two years.

"Each time, it keeps getting bigger and bigger and bigger. More communities in the state play, more federal partners play, there are activities in Canada, and this year Homeland Security has adopted this as a national level exercise," he says. "So this is probably the biggest exercise that our state will ever be involved in."

He says over the course of the two-day exercise, they’ll sound the tsunami siren and evacuate the schools to high ground. They’ll also set up the emergency operations center at City Hall and a shelter at the PCR.