Kenai council to hear HUD grant for Sixth Street water and sewer work

Water, sewer and street construction on Kenai's Sixth Street would draw partial funding from federal housing money under an ordinance before the Kenai City Council on Wednesday. The council will hold a public hearing on the measure. The meeting begins at 6 p.m., with several agenda items scheduled ahead of the public hearings.

The ordinance increases estimated revenues and appropriations in the Municipal Roadway Improvement Capital Fund for partial construction. The money comes from a U.S. Department of Housing and Urban Development Community Development Block Grant, federal funding passed through to state and local governments for housing and infrastructure projects. The grant reaches the city through the Alaska Department of Commerce, Community, and Economic Development, along with funding from the Kenai Peninsula Housing Initiative. The agenda does not state a dollar amount.

HUD allows block grant funds to be used for water and sewer construction. The agency requires a written release before the money is obligated or spent.

Kenai Peninsula Housing Initiatives, Inc., formed in 2003 as a nonprofit to provide affordable housing opportunities in the Kenai Peninsula Borough, emphasizes the importance of federal grant funding and partnerships to stabilize neighborhoods and expand affordable housing on the peninsula. The organization was awarded $1.3 million in federal Neighborhood Stabilization Program funds through Alaska Housing Finance Corporation in 2009 to stabilize Kenai Peninsula neighborhoods hit by home foreclosures.

The arrangement reflects a broader pattern in which Alaska communities lean on HUD block grants and related federal housing money, administered through state agencies and local housing nonprofits, to finance basic infrastructure such as water and sewer improvements. The state has also received about $2.3 million in Community Development Block Grant Mitigation funds for recovery from the 2018 Cook Inlet earthquake. Half of that must be spent in the Kenai Peninsula and Matanuska-Susitna boroughs.

The agenda sets three motions on the ordinance: introduction, a second reading that requires a unanimous vote, and enactment that requires five affirmative votes.

Kenai Peninsula Economic Development District economist Andy Wink is scheduled to present the 2026 Housing Assessment Report to the council the same night. An earlier Alaska News article noted the city has proposed a 4% water and sewer rate increase to address aging infrastructure.