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The federal government has contacted the Mat-Su Borough asking for repayment of $12.3 million dollars in grant funds connected to the idle MV Susitna. In a letter dated August 5th, the Federal Transit Authority says that the borough has thirty days to repay the amount or else risk delinquency. The borough has made attempts to sell the 190 foot vessel as well as to transfer it to another public entity. In the latter case, the hope was that the federal grant funds could be transferred as well.
Mat-Su Borough Manager John Moosey says he is not surprised to receive the letter, and that the challenge of selling the ferry has been greater than expected. On Thursday afternoon, Moosey spoke with reporters. He says that the borough will continue to look at options to avoid paying the full $12.3 million that the FTA is asking for. Whatever conclusion is reached, the funds would have to come from the borough’s general fund, since there is not money currently set aside to repay the federal grants.
If the borough does not repay the grant within thirty days, the FTA says it could charge interest and eventually late payment fees. The special meeting of the Borough Assembly to discuss the matter will take place at 6:00 pm on Tuesday, August 12th.