Catherine Buley of Searsport walks home after grocery shopping at Tozier's Family Market in downtown Searsport in this 2014 file photo. Credit: Gabor Degre / BDN

The Maine Department of Transportation has to decide how to move forward with a much-needed reconstruction of Route 1 in downtown Searsport after bids came around $5 million to $10 million more than the state’s estimate.

On Wednesday, the MDOT closed the bidding process for a project that would reconstruct around two miles of Route 1 — from Savage Road to Station Avenue — in downtown Searsport

The state estimated the project would cost $12.8 million, with $9 million coming from 2022 federally earmarked funds and the rest from state funding. But just two bids came in at $17.6 million and $21.6 million.

It’s one of many projects that MDOT has had to reevaluate the price tag for in the wake of rising costs of labor, transportation and materials.

U.S. Bureau of Labor Statistics data show that the average cost of construction materials rose by 16 percent from January 2022 to January 2023. Meanwhile, it’s harder — and more expensive — to find contractors and workers to get these jobs done.

“Post COVID, we’re seeing a 30 to 40 percent increase in the cost of doing business and then, all of a sudden, you’re hitting a wall on labor forces,” MDOT Senior Project Manager Ernie Martin said. “We’re still in a tailspin on trying to get that crystal ball you can rub and come out with an exact number we can all feel comfortable with. It’s a moving target.”

MDOT will be rehabbing and reconstructing roadways and sidewalks on the stretch of Route 1 that runs through downtown Searsport. Roadways will be repaved, sidewalks will be replaced with bricks and granite curbing, and traditional lamp posts will be installed over the course of the two-and-a-half-year project.

Town Manager James Gillway said in December that the reconstruction project will be another spark for economic development in the town.

MDOT first identified the Route 1 corridor through Searsport as an underdeveloped segment 10 years ago. But the project was stalled due to changing priorities, a change in MDOT programming and COVID related delays.

By July 2022, the project was ready to go out to bid after MDOT acquired the federally earmarked $9.2 million and state funding — but no bids came in.

Martin suspects the state didn’t receive any bids because Searsport is a hard to reach area for MDOT contractors and because of a lack of guidance on traffic controls — which meant contractors might have had to do overnight work.

With new traffic detours developed, MDOT got some bites — though not much. Martin learned that only two bids had come in from Sangerville- and Bangor-based firms, with the lowest coming in 36.6 percent above the estimate.

Martin believes rising costs are to blame. While he said many other MDOT projects have taken hits due to these rising costs, Searsport is an anomaly because there aren’t many MDOT authorized contractors in the area. That makes the bidding process less competitive.

“There’s a lot when it comes to what we’re up against,” Martin said.

Moving forward, Martin said MDOT officials will be figuring out next steps forward and how to fill that gap in funding. He’s unsure what MDOT can do — that’s not for him to decide. But he suspects the project can only move forward if MDOT asks the state for more funding.

“We’ve been trying feverishly but we keep hitting a wall here,” Martin said. “Hopefully over the next couple of days we’ll have those internal discussions here and try to figure out a strategy on how we can deliver this thing.”