WATERVILLE — A $1 million federal grant announced Thursday is the final piece of a financing plan for a new Interstate 95 exit to Trafton Road in Waterville.

The grant, from the U.S. Economic Development Administration, is part of a three-party agreement announced in September to pay for the interchange, which also is using $2 million from both from Trafton Properties Inc. and the Maine Department of Transportation.

The grant was announced in a news release from U.S. Rep. Chellie Pingree, D-1st District.

“This is a real economic development project,” Pingree said in the release. “By increasing access to the industrial facility on Trafton Road, it’s going to call the current companies doing business there to expand. That creates jobs and puts money directly into the local economy.”

The $4.8 million exit project is intended to provide increased access to light manufacturing in the Trafton Road area easier.

Rhode Island-based Trafton Road Realty owns more than 900 acres in Waterville and Sidney and an industrial plant at the intersection with West River Road that includes light manufacturing and warehouse space.

The project is expected to leverage $34 million in private capital, according to the notice of investment award from the Economic Development Administration. The total amount of the award is $992,687, about half of what developers said they were looking for in September.

The project initially was estimated to cost $6 million, but the price was reduced after a simpler design was adopted, said Harry Kojoian, vice president of operations for Trafton Properties, in a telephone interview Friday.

“That was the last piece of the financing puzzle we were waiting for and now that it’s in place, we are ready to move forward,” Kojoian said.

The proposed exit, which would be halfway between the Lyons Road exit in Sidney and the Kennedy Memorial Drive exit in Waterville, has been sharply criticized by local property owners who have expressed concern about increased traffic and noise.

The highway exit project has been in the works for at least four years.

“It’s been a long and hard project, and we’re happy with what we’ve accomplished,” Kojoian said.

The company intends to expand its footprint by constructing more buildings in the area to attract light manufacturing.

“I’m hopeful this could be an opportunity to develop this part of the city of Waterville,” Kojoian said.

Reached on Friday, Waterville City Manager Michael Roy said the grant announcement was “extraordinarily good news.”

The city plans to use as much as $500,000 in tax increment financing money to improve and repair roads in the area of the highway exit, which will be funded with new revenue from properties in the area.

“This project really opens up opportunities for the city to increase its tax base,” Roy added.

However, the largest tenant at the existing Trafton Properties facility plans to vacate the building by the end of the year.

In early April, precision machining company Midstate Berkshire announced that it was laying off 70 employees, 30 percent of its workforce, and consolidating its central Maine operations at its plant in Winslow. The Waterville assessor’s office estimated that the move could cost the city almost $120,000 in tax revenue.

Building the new exit is still important, despite Midstate Berkshire’s planned departure, said Kim Lindlof, interim executive director of the Central Maine Growth Council.

Kojoian “is very bullish about built-to-suit,” Lindlof said, referring to a way of building commercial property to lease according to a tenant’s specifications.

“He’ll fill that place,” she said.

Peter McGuire — 861-9239

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Twitter: @PeteL_McGuire