Both times TAB applied for, and received, a contract extension from the Sitka assembly. Both times, TAB forfeited a $100,000 advance on bulk water it purchased but never shipped.

Sitka administrator Jim Dinley says, “It’s a win-win situation for the city.” Sitka has yet to see any revenue from bulk water sales, but the sale of the rights has proven to be a modest money-maker.

Sitka holds a permit to sell 9-and-a-half billion gallons of bulk water per year out of Blue Lake — water which is running into the ocean right now. TAB’s contract is for roughly a third of that amount. Sawmill Cove Industrial Park director Garry White says there is at least one other creditable buyer for some of the remaining 6-billion gallons, Aqueous International, but that company is developing its business plan further before putting up the $100,000 Sitka requires to reserve rights.

White says TAB was sent a “cure letter” on December 8 demanding the export of bulk water from Sitka within 45 days. TAB CEO Terry Trapp has already been in touch; White says Trapp has asked to update the Sawmill Cove Board on his company’s plans within the 45-day period, and then will likely ask for another extension on the contract. A contract amendment would go first to the Sawmill Cove Board, and then to the Sitka assembly. It will cost TAB another $100,000.

City administrator Jim Dinley says he’ll bring the matter to the attention of the assembly once the 45 days have passed.
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