An analysis of the money paid and made by extending Wrightsville’s beach strand and building up the dunes every four years could secure or curb continued federal funding to complete the projects.
When calculating a new benefit-cost ratio for the coastal storm damage reduction, or renourishment, project, the U.S. Army Corps of Engineers will consider the financial impact on residents, businesses and infrastructure if the project is not completed, as well as recreational benefits totaling no more than 49 percent of the project’s total financial benefit, said Hank Heusinkveld, public affairs specialist for the Wilmington District, U.S.A.C.E. The total project benefits will be stacked against the cost of the project to determine the financial return on the multi-million dollar projects.
The Wrightsville project was ascribed a 1.4 benefit-cost ratio upon its original federal authorization in 1986, Heusinkveld said, meaning it was estimated to provide $1.40 in benefits for every dollar spent. A benefit-cost ratio that exceeds one is considered favorable, he added.
Wrightsville Beach Town Manager Tim Owens said he wonders how changes in the town’s oceanfront development since 1986 might impact the new financial analysis.
“There’s a lot changed since 1986. Some good, some bad,” Owens said. “The costs are more, and hopefully the benefits are more, too. But we won’t know until they get into . . . the cost-benefit analysis.”
Both Owens and Wrightsville Beach Mayor Bill Blair cited concerns about the updated benefit-cost ratios — which Heusinkveld said will be completed for all federally authorized projects — and how the results will be used to whittle down long lists of requests for federal funding.
“You would think the cost-value ratio would be better, since [property] values are way up. The problem is, you’re not exactly sure what you’re comparing it to,” Blair said. “This is new stuff. We’ve got $3.2 billion of property on Wrightsville Beach. How does that stand up in the list of communities versus the cost of beach renourishment? That’s how it’s going to be compared.”
A limited reevaluation report completed by the Corps will provide a vehicle for the Corps to both update the project’s benefit-cost ratio, and a summary of the project’s total cost, which can be used in Congress to overcome a second hurdle on the horizon for Wrightsville Beach that could limit the flow of federal funds to only one or two more renourishment cycles.
Projects funded in Water Resources Development Acts passed after 1986 are subject to an overall project cost ceiling. A limit of $34.5 million was applied to the Wrightsville Beach project over the course of its 50-year federal authorization; the seven projects completed since 1986 racked up a total cost of $22.1 million, leaving $12.4 million to last through 2036. The only solution for the project cost limit is through legislative action, likely by securing language providing a higher project cost limit in a future Water Resources Development Act.
“This thing about the cap is what’s got everybody anxious,” Blair said. “The fix on that is a political fix, a contractual political fix. The Corps only does what the contract says.”
The Corps does not know how or why the Wrightsville Beach project so quickly approached its cost limit, Heusinkveld said, but Owens expects other projects authorized after 1986 will face a similar dilemma due to the rising cost of dredge mobilization and fuel prices.
“That projection isn’t very favorable for us because costs have risen so quickly, so I have a feeling we’re not the only person in this boat. I think there will be other beach projects, other inlet projects, other dam projects,” Owens said.
Strength in numbers could be a bargaining tool for U.S. Rep. David Rouzer, R-N.C., who said he is aware of the issue and plans to look at a variety of possible solutions.
“I’ve never promised anyone anything other than my best effort,” Rouzer said. “But my batting average is pretty good, so I’m hopeful we’ll be able to get something worked out.”
The cost to complete Wrightsville’s coastal storm damage reduction projects is typically split among federal, state and local contributions. Currently, the state does not offer a 17.5 percent contribution unless the federal government pays 65 percent, and the rest of the tab is paid with room occupancy tax dollars.
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