A coalition planning to dredge around wharves and marinas in Portland Harbor failed once again to secure a competitive grant that would pay for two-thirds of the $31 million project.

The news, delivered Thursday, was a letdown for organizers who believed they had made a persuasive case that the funding would help Maine’s transportation, economy and environment.

“It is a benefit to do the dredging. It is not just the cities of Portland and South Portland – all of the state of Maine would benefit from this,” said Dan Haley, chairman of the Portland Harbor Commission. “I’ll have to admit I was feeling a little cocky. I was very disappointed, but we will move forward.”

Organizers sought $24 million from a competitive U.S. Department of Transportation grant program to do the work. Decades of contaminated silt built up around wharves and marinas has reduced water depth and cut off more than a quarter of commercial berthing space, limiting marine business and transportation.

The cities of Portland and South Portland, the Portland Harbor Commission and private wharf owners have pursued the dredging project for years and have been denied federal funding multiple times.

Because wharf sediment is contaminated, it has to be secured in an underwater well known as a confined aquatic disposal cell, instead of being deposited in open water. Designing and constructing the cell has substantially increased the project’s cost.

The previous grant application was rejected last year. Organizers reviewed the Department of Transportation’s comments and put together a package they thought would succeed in the current funding round.

The fact that the project has state and local funding lined up, has necessary permits and broad public support were thought to have given it a good chance of being funded. Even so, transportation grants are notoriously competitive, with one in eight projects funded each cycle and hundreds of applicants.

“This is not the answer we were hoping for,” said Portland Waterfront Coordinator Bill Needelman in a statement. “We have our permits in place, we made the economic case, we built an unparalleled partnership and there is zero opposition. The project is needed and ready to go.”

Ninety infrastructure projects in 47 states were awarded grants from the $1 billion Rebuilding American Infrastructure with Sustainability and Equality program, the DOT announced this week.

Two Maine projects were among those awarded funding. The Houlton Band of Maliseet Indians received $15 million to reconstruct 4.5 miles of heavily used Foxcroft Road and separate vehicle traffic from bicycles and pedestrians.

The city of Bangor was awarded $1.6 million to realign Interstate 95 off-ramps to Route 15 and upgrade traffic signals to make the high-crash corridor safer.

The group pursuing Portland Harbor dredging intends to regroup and look for ways to get the project funded. It is now time-sensitive, as permits have a five-year lifespan.

Portland, South Portland and the Maine Department of Transportation have pledged $6.4 million to the project. This summer, the Legislature approved $10 million from Gov. Janet Mills’ economic recovery package for dredging if the grant application was unsuccessful.

“Our economic study clearly demonstrates that the entire region, indeed, the entire state benefits from Portland Harbor. But a harbor without vessel berthing is like an airport without a runway. It cannot function,” said South Portland Economic Development Director Bill Mann in a statement. “Our permits have a shelf life, it is critical that this project happens, now.”

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