Wasilla council to decide Monday on $6 million state loan to expand sewage plant

The Wasilla City Council holds a public hearing at 6 pm Monday, Nov. 9, at City Hall on accepting a $6 million state loan to expand the city's wastewater treatment plant.

The Alaska Department of Environmental Conservation would forgive $1.4 million of the loan. The city would repay the remaining $4.6 million over 20 years at a 2.2 percent finance charge, according to the state's Sept. 18 loan offer in the Nov. 9 council meeting packet. A city finance estimate puts total interest at about $1.3 million. The ordinance would let Mayor Alina Rubeo sign the loan agreement.

The loan covers part of a sludge and digester project estimated at nearly $13 million, along with grants and city capital funds. Alaska News reported July 30 on the city's plan to borrow for the expansion. A memo from project manager Rick Antonio says the city's growth since the plant was built has made it inadequate. City notes from an October 2025 public meeting said the digester was limited to 5,000 gallons a day, less than two truckloads, and that commercial haulers were taking some septic waste to Anchorage. The project includes new digesters, piping and a building for blowers and dewatering equipment.

The city would repay the debt using net revenue from its wastewater system, with other city funds as backup, and the general fund would cover estimated interest. The proposed fiscal 2027 budget says water and sewer rates have not risen since fiscal 2014. It projects about 20 percent more revenue under new rates from a rate study now underway.

A letter from Stantec, the city's engineer, says the city upsized two digesters from 143,000 to 200,000 gallons, and the operations building grew from about 3,020 to 5,375 square feet. A separate resolution on the consent agenda would add $199,625.25 to Stantec's contract for design and bidding help.

Stantec says the bid schedule is still undecided but assumes bidding this fall and a construction contract by year's end. The city's first loan payment would come due one year after the project reaches substantial completion.