The Wrangell Borough Assembly Tuesday approved a funding plan to replace the float system at Shoemaker Bay Harbor.

The harbor is about 5 miles south of town. This project will replace all existing floats and both gangways at Shoemaker because the float system is deteriorating.

PND Engineers estimates the project will cost $10.7 million.

About half of that money would come from a state matching grant, and the rest would be a combination of Wrangell’s harbor reserve funds and revenue bonds.

Wrangell Finance Director Lee Burgess said more than $3 million would come from Wrangell’s existing Harbor Replacement Reserves and the Commercial Fishing Infrastructure Fund.

“Those two amounts have been kind of growing over several years, but their purpose is to provide funding to support capital improvements that will renovate our harbors and/or improve the commercial fishing infrastructure. And so both of those sources of money, we feel, are appropriate for this purpose,” Burgess said.

The harbor department defers nearly half of its stall rent revenue to the Harbor Replacement Reserve Fund. The Commercial Fishing Infrastructure fund comes from a portion of the raw fish tax Wrangell receives from the state.

Another part of the funding plan is to issue revenue bonds to raise $2.5 million.

Borough Manager Jeff Jabusch said the Harbor Replacement Reserves will also cover the borough’s annual $182,778 payment on the bonds.

“That money will be there, so there should not be any increase to harbor fees for this reason,” Jabusch said. “So that’s the plan. This money, instead of going into the reserve fund, will make the payment on these bonds for 20 years.”

The float replacement is expected to generate some extra revenue because it will open up stalls that currently cannot be used.

The City and Borough of Wrangell will put in its application for the state grant this summer, and it will only move forward with the revenue bonds if the grant is approved.