Memo-07-11-2017-Item-13

July 11, 2017

MEMO TO:           Mayor Barber and Board of Commissioners

FROM:                  Frank Rush, Town Manager

SUBJECT:           Resolution Authorizing Funding Request to NC Shallow Draft Navigation Channel Dredging and Lake Maintenance Fund for Bogue Inlet Navigation Dredging - (Summary & Suggested Motions)

The Board of Commissioners is scheduled to consider the attached resolution authorizing a new State-local funding partnership that seeks to generate a total of $300,000 for future navigation maintenance dredging in Bogue Inlet.  The proposed share for Emerald Isle is $10,000, with $200,000 provided by the State and $90,000 by other Carteret-Onslow area local governments.  This new partnership is necessary because there is no Federal funding available for dredging, and all funds remaining from previous State-local funding partnerships have been exhausted. 

Background and Recent History

The US Army Corps of Engineers (“the Corps”) has historically maintained the Bogue Inlet connecting channel (“the connecting channel”) and the Atlantic Intracoastal Waterway in our area (“the Bogue Inlet AIWW crossing”), and these navigable waterways are enjoyed by many area businesses, residents, property owners, and visitors.  It is important to understand that these are actually two separate projects for the Corps, and that they are dredged with different types of dredges and funded with different appropriations. 

The Bogue Inlet Connecting Channel

The Bogue Inlet connecting channel is the approximately 15,000 linear ft. channel that leads from the AIWW south to the Atlantic Ocean, and includes the ocean bar.  Prior to June, the connecting channel included a more western route along Dudley Island, but was redesignated to a more central route due to significant shoaling in the western route in recent years, the presence of more naturally deep water in the central route, and as part of our ongoing efforts to promote a more stable channel location. (Maps indicating the new, central route of the connecting channel are attached, and the US Coast Guard has re-installed aids to navigation along this route.) 

The connecting channel has shifted around the Bogue Inlet complex over time, and has been historically maintained by the Corps with government-owned sidecast dredges that simply dredge the material from the bottom and cast it approximately 100 – 150 ft. to the side in shallow water.  The sidecast dredge does not have the capability to place dredged material on the beach, and is intended solely to provide short-term navigation benefits with an expectation that repeated dredging will be necessary to keep the channel open when shoaling occurs.  The authorized depth of the connecting channel is 6  - 8 ft. at mean low water. 

The Corps has historically dredged the connecting channel multiple times per year as needed, depending on shoaling conditions and the availability of the government-owned sidecast dredges.  It is important to note that the entire 15,000 linear ft. channel is not dredged during each dredging cycle or even each year.  In fact, some areas of the connecting channel have likely been dredged very infrequently, as shoaling conditions in certain areas of the connecting channel are minimal and do not require significant dredging.  Historically, most sidecast dredging in the connecting channel has occurred across the ocean bar and at a few troublesome locations between the AIWW and the ocean bar. 

Prior to the mid-2000s, Federal funding (approximately $300,000 - $400,000 annually, and sometimes more) was routinely appropriated for dredging in Bogue Inlet.  With the exception of special hurricane-relief appropriations, Congress has not appropriated funding for the dredging of the Bogue Inlet connecting channel since the mid-2000s.  Due to ongoing Federal budget challenges, it is unlikely that new annual appropriations are forthcoming.  Due to the absence of reliable Federal appropriations, the Town of Emerald Isle led efforts in 2006, 2011, 2014, and 2016 to assemble State and local funding for Bogue Inlet dredging.  The 2006 effort provided a total of $380,000 from the following:

        2006 State-Local Partnership

        State of North Carolina                                                             $ 285,000                75%

        Carteret-Onslow area local governments                                                                25%

                Onslow County                                                                        30,000

                Town of Swansboro                                                                  8,000

                Carteret County                                                                       30,000

                Town of Emerald Isle                                                              15,000

                Town of Cape Carteret                                                             6,000

                Town of Cedar Point                                                                 6,000

 

        TOTAL                                                                                         $ 380,000

 

These funds were used to fund various dredging efforts between 2006 and 2013, and were supplemented by special hurricane-relief appropriations (Ophelia, Irene, etc.) by Congress.  These supplemental appropriations essentially enabled the Corps to reserve the 2006 State-local funding, and the 2006 State-local funding was used after all hurricane-relief appropriations were exhausted. 

In 2011, just before Hurricane Irene hit in August, there was concern that the 2006 State-local funding would soon be exhausted, and a new State-local funding partnership provided a total of $182,000 from the following:

        2011 State-Local Partnership

        State of North Carolina                                                               $ 91,000                50%

        Carteret-Onslow area local governments                                                                50%

                Onslow County                                                                        30,000

                Town of Swansboro                                                                  6,000

                Carteret County                                                                       30,000

                Town of Emerald Isle                                                              16,000

                Town of Cape Carteret                                                             3,000

                Town of Cedar Point                                                                 6,000

 

        TOTAL                                                                                         $ 182,000

After Hurricane Irene, Congress again appropriated hurricane-relief funds for Bogue Inlet dredging, and that appropriation enabled the Corps to reserve the remaining 2006 State-local funds and the new 2011 funds for future dredging efforts.  The 2006 and 2011 State-local funds were eventually exhausted by 2014, and another new State-local partnership sought a total of $320,000, however, only $280,000 was made available due to Onslow County not providing the full amount requested (which also reduced the State contribution – by formula), as follows:

        2014 State-Local Partnership

        State of North Carolina                                                                                              

                   $160,000 expected, but actual amount was              $ 140,000                50%      

        Carteret-Onslow area local governments                                                                50%

                                Onslow County                                                                                    

                                   $75,000 requested, but actual amount was                    55,000               

                Town of Swansboro                                                                  5,000

                Carteret County                                                                       55,000

                Town of Emerald Isle                                                              15,000

                Town of Cape Carteret                                                             5,000

                Town of Cedar Point                                                                 5,000

 

        TOTAL                                                                                         $ 280,000

By mid-2016, the 2014 State-local funds were nearly exhausted, and another State-local partnership was assembled.  By this time, the State had increased its cost-share for dredging from 50% to 67%, which made it more affordable for area local governments.  The 2016 State-local partnership sought a total of $300,000, however, only $262,500 was made available due to Onslow County not providing the full amount requested (which also reduced the State contribution - by formula), as follows:

2016 State-Local Partnership

        State of North Carolina                                                                                              

                   $200,000 expected, but actual amount was              $ 175,000                67%      

        Carteret-Onslow area local governments                                                                33%

                                Onslow County                                                                                    

                                   $47,500 requested, but actual amount was                    35,000               

                                Town of Swansboro                                                                  2,500

                                Carteret County                                                                       35,000

                                Town of Emerald Isle                                                              10,000

                                Town of Cape Carteret                                                             2,500

                                Town of Cedar Point                                                                 2,500

 

                        TOTAL                                                                                         $ 262,500

The 2016 State-local partnership funds were supplemented by approximately $6,000 of remaining funds, and resulted in a total of approximately $268,500 available for 2017 dredging activities.  These funds were used for dredging activities in April and June, and were exhausted by early June.  Due to the need for additional emergency dredging in order to enable the US Coast Guard to restore the aids to navigation in Bogue Inlet, the Town committed an additional $20,000 that was matched with $40,000 from the State, and additional dredging was completed (along with re-installation of the aids to navigation) in mid-June.  In reality, only approximately half this amount was necessary (approximately $30,000), and the Town remitted $10,000 in June (that was matched with $20,000 from the State).     

Thus, as noted, all previous State-local partnership funds have been exhausted, and no maintenance dredging will occur in Bogue Inlet until additional funds can be identified. 

The Bogue Inlet AIWW Crossing

The Bogue Inlet AIWW crossing is an approximately 5,000 linear ft. segment of the AIWW located adjacent to Cedar Point at its intersection with the Bogue Inlet connecting channel.  (The Bogue Inlet AIWW crossing is also depicted on the attached map as “Section 1, Tangent G” near Cedar Point.)  The Bogue Inlet AIWW crossing is one of 8 AIWW crossings in North Carolina maintained every 3-4 years by the Corps, and is usually dredged with a privately-owned pipeline dredge that is under contract to the Corps.  The pipeline dredge uses suction to remove dredge spoils and then pumps the spoils away to a designated disposal site on the beach at or near The Point.  The Corps usually groups the work at several AIWW crossings into one competitively-bid contract to achieve an economy of scale and minimize expensive dredge mobilization costs.  As such, when the Bogue Inlet AIWW crossing is dredged it is usually part of a much larger, state-wide contract.  The authorized depth of the Bogue Inlet AIWW crossing is 12 ft. at mean low water.

Appropriations for the Bogue Inlet AIWW crossing are usually included in a larger Federal appropriation for the entire AIWW in North Carolina, and are not typically budgeted separately (due to the interdependent grouping of multiple AIWW crossings into one contract).  In recent years, the Corps has utilized anywhere from $3 million - $6 million annually to dredge multiple AIWW crossings in North Carolina.  Assuming a proportional distribution of the dredge mobilization costs, and the estimated quantity of material to be dredged every 3-4 years (usually anywhere from 30,000 – 80,000 cubic yards of material), the estimated cost of the Bogue Inlet AIWW crossing work per dredging event is approximately $500,000 - $1,000,000. 

The Bogue Inlet AIWW crossing was last dredged in January 2014, and approximately 48,000 cubic yards of sand was placed on the beach at The Point.  This work was funded 100% by the Corps.  The Bogue Inlet AIWW crossing remains in a safe condition, and will likely not need dredging again until 2018 or 2019.  As of now, we expect Federal funding to be available at that time for the AIWW in North Carolina, however, it would not be surprising if continuing Federal budget challenges impact the AIWW in the future also.  As such, the dredging of the Bogue Inlet AIWW crossing is not within the scope of this agenda item.

Resolution Authorizing Funding Request to NC Shallow Draft Navigation Channel Dredging and Lake Maintenance Fund for Bogue Inlet Navigation Dredging

The attached resolution formally authorizes a new State-local funding partnership for Bogue Inlet connecting channel dredging in 2017.  The attached resolution authorizes a State funding request in the amount of $200,000 (67%), and also authorizes the Town Manager to coordinate with other area local governments to provide the required 33% local match ($100,000). 

The total amount of State-local funding, if approved by all parties, would be $300,000, and this amount is expected to be sufficient to fund approximately 17 days of dredging.  This amount is expected to be sufficient to fund only one or two dredging activities over the next year, and we are hopeful that the channel will remain in a relatively safe condition during that time.  If a new, dedicated funding source for future navigation dredging is not identified in the meantime, it is likely that another State-local funding partnership will be contemplated sometime in 2018, and likely each year thereafter. 

If the Board approves the attached resolution, the Town (with assistance from the Carteret County Shore Protection Office) will present formal requests to Carteret-Onslow area local governments and to the NC Shallow Draft Navigation Channel Dredging and Lake Maintenance Fund.  The proposed cost-sharing in the attached resolution is as follows:

        Proposed 2017 State-Local Partnership

        State of North Carolina                                                             $ 200,000                67%

        Carteret-Onslow area local governments                                                                33%

                                Onslow County                                                                        47,500

                                Town of Swansboro                                                                  2,500

                                Carteret County                                                                       35,000

                                Town of Emerald Isle                                                              10,000

                                Town of Cape Carteret                                                             2,500

                                Town of Cedar Point                                                                 2,500

 

                        TOTAL                                                                                         $ 300,000

The amount requested from each of the Carteret-Onslow area local governments is identical to the amount requested in 2016, and I am hopeful that all of the Carteret-Onslow area local governments (including Onslow County) will provide the requested amount.  The proposed cost-sharing is intended to keep the amounts provided by the area municipalities at a manageable and realistic amount that is consistent with recent history (and their annual budgets), and also reflects the fact that the municipalities are also part of each county. 

The proposal again seeks to split the local government cost-share equally between Onslow County and Carteret County -- $50,000 each between each county and its municipalities.  The towns of Swansboro, Cape Carteret, and Cedar Point are all similar in size, and these towns have historically made a similar contribution to Bogue Inlet dredging costs.  Emerald Isle’s share is larger than the other municipalities due to our larger size and tax base.  If the Board approves the attached resolution, I envision the Town and/or the Carteret County Shore Protection Office sending a formal funding request to each of the area local governments for their formal consideration in the coming weeks.   

As noted, the Town previously remitted $10,000 for emergency dredging in June in order to enable the re-installation of aids to navigation.  In the interest of (relative) simplicity, goodwill toward our other local government partners (in particular Onslow County, as part of our efforts to persuade them to remit the full amount requested), and maximizing the amount available for future dredging activities, I am recommending that the Town simply absorb this expense and not seek a “credit” for this contribution.  If the Board disagrees with this approach, I will factor in the appropriate “credit” for Emerald Isle in the 2017 State-local partnership, which would reduce the total amount available from $300,000 to $270,000 (essentially, in that scenario the $30,000 would have been “pre-paid” by the Town and the State in June).     

The Town of Emerald Isle’s recommended contribution for the 2017 State-local partnership is (a new) $10,000, and these funds are included in the FY 17-18 budget approved by the Board.  It is also important to note that Carteret County’s contribution will need to come from the County’s General Fund, as this dredging does not involve sand placement and is therefore not an eligible expense for the Carteret County Beach Commission. 

Potential Future Dredging Strategy for Bogue Inlet Connecting Channel

As noted in previous correspondence with the Board, the Town has been issued a new permit to also conduct navigation dredging activities in the Bogue Inlet connecting channel.  The new permit is nearly identical to the existing permit held by the Corps, and was obtained in case the Corps eventually abdicates its dredging responsibility in Bogue Inlet.  The new permit will enable the Town to contract with a private dredging company to maintain the Bogue Inlet connecting channel in the future, and could potentially enable the Town to utilize a pipeline dredge with the capability of depositing material on the beach in Emerald Isle rather than simply “casting it to the side” of the navigation channel. 

This approach may be very beneficial in the future, as it has the potential to provide a more consistent deep(er) water channel and allow for beneficial use of the sand (i.e., to strengthen The Point).  Although this approach is more expensive per event, I believe that the costs will be lower over the long-term, the Bogue Inlet connecting channel will be better defined and safer, additional nourishment benefits would be realized, and that it would promote a more central location for the main ebb channel in Bogue Inlet (away from Emerald Isle).  We plan to further evaluate this option in the future.  If additional evaluation suggests this is a prudent approach, and sufficient local funds can be identified, we may present a recommendation to the Board and the Beach Commission for such an effort in the future.  Additionally, I believe that such a project would be funded 67% by the State, 22% by the Beach Commission, and 11% by the Town (from the Future Beach Nourishment Fund).  This approach may ultimately prove to greatly extend the duration between the Town’s major Bogue Inlet channel realignment projects in the future.

Long-Term Funding for the Bogue Inlet Connecting Channel?

As noted above, the funding proposal included in the attached resolution would result in a total of $300,000 (or approximately 17 days’ worth) for maintenance dredging of the Bogue Inlet connecting channel.  Based on historical trends, I am hopeful that this amount will be sufficient to meet dredging needs through 2017 and into mid-2018.  This funding proposal obviously only addresses the short-term, and it remains important for Emerald Isle, other local governments, and others concerned about maintenance dredging to work on a long-term solution. 

I look forward to discussing this issue with the Board at the July 11 meeting.