The cash-strapped city of Oak Harbor may have to pay back more than $500,000 in grant money that was spent on designing and permitting a municipal pier if the project isn’t constructed.

Construction was supposed to begin this year on the proposed Y-shaped, pier at Flintstone Park on Bayshore Drive.

Instead, city leaders have relegated the project to the middle of a list of 17 non-capital fund projects, totaling nearly $90 million. Projects that top the preliminary list include marina redevelopment and Pioneer Way reconstruction.

The city probably won’t have enough money to fund any of the projects any time soon, at least not without a voter-approved levy or a giant grant.

Still, Helen Chatfield-Weeks, who co-chairs the pier committee with Doug Francis, said there is reason for optimism, as well as urgency.

“We’re still very enthusiastic about it,” she said, “and we want to go every route to find money. But with every single month that goes by, the price goes up.”

In fact, Francis said skyrocketing construction costs is one of the reasons that the project is in jeopardy.

“When we started out, it was $3.2 million,” he said. “A $3 million pier is a different thing than a $6 million.”

The price tag for the pier was $6.3 million for 2006, but it’s probably increased significantly for 2007, according to city staff.

Another problem, Francis said, is that cities like Oak Harbor lost a major portion of its budget because of voter-approved, tax-cutting initiatives, which means there’s not any money lying around for large projects.

More than $700,000 in grant and city money has been spent on the pier effort to date. In April of 2005, the council unanimously approved a $440,000 contract with the engineering firm PND Incorporated for final design and engineering of the pier.

City Engineer Eric Johnston said the work is 95 percent complete, but one final step is needed. Since the city received federal dollars for the pier project, a National Environmental Policy Act process is required. Johnston said he plans to submit the application for review next month.

Mayor Patty Cohen said she is realistic about the pier prospects, but she’s crossing her fingers. She said state or federal money is probably the best bet for funding the project. After all, the pier would provide a transportation hub for a foot ferry, as well as providing water recreation opportunities.

Johnston said city staff has been in contact with federal legislators about funding for the pier, but the news isn’t very hopeful. The new Congress will likely keep much of the earmarks, also known as pork, out of the budget.

Last fall, Second District Rep. Rick Larsen was able to put a $1 million earmark for the pier in the House spending bill for the Departments of Transportation, Treasury and Housing and Urban Development for Fiscal Year 2007. But the bill wasn’t passed.

If fact, Congress passed only two of the 11 spending bills needed to run the government before it adjourned Dec. 9. Congress kept the departments funded through “continuing resolutions.”

“While the House Appropriations Committee has decided that there won’t be any earmarks for Fiscal Year 2007, Congressman Larsen is committed to helping Oak Harbor secure funding for this important project and will keep working to promote economic development in the area,” Larsen’s communications director, Amanda Mahnke, said.

Grants can be risky. They usually require a match from the city. And if the project isn’t completed, the city may have to return money, even if it was spent.

City Finance Director Doug Merriman has been planning for the day when the city may have to pay back the $512,000 in grants that was spent on things like design and engineering. He’s started a fund that will gradually accumulate cash from the general fund.

If the pier isn’t constructed in about eight years, then the city is supposed to pay the grants back. If it is constructed, money in the fund can be used for construction.

Yet Johnston said the city can always ask for an extension or a waiver of the requirement of paying the money back.

Some of the permits the city already obtained will begin to expire at the end of this year, but again Johnston said the city may be able to obtain extensions.

“There are things we can be doing to keep the permits in hand,” he said.

A final funding option would be to ask the voters to approve a levy to fund the pier. A couple of city councilmen have suggested packaging the marina redevelopment and pier together and presenting it to the voters.

But so far, city leaders have been very reluctant to ask voters for money.

The pier project began eight years ago as a brainchild of former Mayor Steve Dernbach. He envisioned it as a replacement for the Maylor Pier, which burned down in the 1960s.

Francis, Chatfield-Weeks and other members of the pier committee spent eight years tirelessly researching the project and working with consultants.

The result was a design for a Y-shaped, fixed-wood pier with concrete floats beside it.

The approach pier will be 176 feet. The longer of the two arms of the rigid pier will be 270 feet long. This “commercial arm” is for passenger ferries and tour boats. The other floating arm will be 210 feet. It’s designed for recreational boats. At the end will be a float for seaplanes.

Wave barriers on the west side will protect the entire structure from storm action in the bay.

The current design includes a number of structures. It includes a small building at the intersection of the Y, for use as a shelter or ticket booth. Another shelter will be at the end of the commercial arm, which will be an outlook.

On the shore will be a building for restrooms, concessions and an office.

You can reach Jessie Stensland at jstensland@whidbeynewstimes.com or 675-6611.