PORT ANGELES — The National Park Service will continue operating the Elwha River Surface Water Intake facility past Oct. 1, breaking an impasse with the city, officials with both the Park Service and city said.

That spares the city — for now — the expensive quandary of operating in about eight weeks the $25 million diversion system that was built as part of the Elwha River dam removal-river restoration project.

The NPS will keep running it until the end of 2017 while they continue talking about who will pay for what and continue to disagree over the intake system’s long-term functional integrity.

Brian Winter, manager of the Elwha dam removal and river restoration project, said Friday that the NPS will spend federal funds on continuing to operate the intake system. The money was set aside for a potential settlement agreement for a transfer pact with the city.

“We are looking to put out a scope for bids on a contract to operate the facility,” Winter said.

But what to do about a defunct $50 million water treatment plant built to treat sediment-laden water from dam removal is still up in the air and part of ongoing discussions between the city and the Park Service.

“We’ve been having monthly meetings with the [Lower Elwha Klallam] tribe, the city and the NPS to work through these issues,” Craig Fulton, city public works and utilities director, said Friday.

“Part of our discussion is, what to do with it,” Fulton said of the treatment plant.

“We’d like to have it demolished and removed.

“The city does not want to have the facility sitting there and the city has to pay to remove it.”

The treatment and intake facilities were built to mitigate impacts of the historic $325 million tear-down of the Glines Canyon and Elwha dams — completed in 2014 — on the city’s water supply while the dam-depleted river habitat is restored to resurrect several fish species.

The intake structure diverts water for a state Department of Fish and Wildlife fish-rearing channel, the Lower Elwha Klallam tribe’s fish hatchery and Nippon Paper Industries USA’s Port Angeles mill.

City officials disagree with the Park Service that the impacts of dam removal have ended, and at the City Council’s direction have hired the Seattle law firm Lane Powell PC a to press their case.

Fulton and City Attorney Bill Bloor told the City Council June 7 that critical components of the intake system are in disrepair and require significant, expensive upgrades to function long-term.

“We don’t agree with that,” Winter said Friday. “That’s why we are in discussions.”

The intake structure’s pumps, valves and hydraulic system make for a facility [that is] more complex than anyone had imagined, he added.

Fulton said initial estimates peg the annual cost of operating the intake system at $750,000-$1 million, which would include hiring two to three more employees.

Fulton said who will pay to operate the intake system once the NPS departs also has not been resolved, adding that normally the cost is borne by the water customers who use the water, in this case the tribe, Nippon and state Fish and Wildlife.

“The [city] water utility does not have that money,” Fulton said.

“The water customers would have to pay it, or we would be looking at some compensation from the federal government to support the costs.”

Fulton said the funding talks with the National Park Service are centered on costs that would be entailed in operating the system for 20-25 years, which Bloor told the Peninsula Daily News July 17 could reach $41 million.

While the Park Service will be operating the intake structure for another year, agency officials are already setting the stage for their departure.

“We are training city staff to on how to operate the facility,” Winter said. “We are going forward.

“If and when they do take over, they will have a staff fully trained to handle it.”

City officials have had longstanding concerns about the treatment plant and intake system, collectively known as the Elwha Water Facilities, and the city’s Ranney Collector.

The collector draws water for the municipal system from a river aquifer 3 miles upstream from the mouth of the Elwha.

In 2013, the city threatened to block removal of the Glines Canyon Dam, which stood inside Olympic National Park, until the NPS and city reached a compromise to complete the project.

They reached an understanding that “complete mitigation for the city’s water supplies would be accomplished after dam removal,” Fulton and Bloor said in their memo to the council.

“Dam removal was completed, but there has been no collaborative resolution of the city’s serious ongong concerns about the adequacy of the EWF and the city’s Ranney Collector.”

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Senior Staff Writer Paul Gottlieb can be reached at 360-452-2345, ext. 55650, or atpaul.gottlieb@peninsuladailynews.com.