East Coast dredging rates have fallen with the awarding of a $2.3 million contract to clear navigation channels in Connecticut's New Haven harbor.

The low bid by Great Lakes Dredge and Dock Co. of Staten Island, N.Y., earlier this month surprised U.S. Army Corps of Engineers officials, who had estimated that the dredging of some 1 million cubic yards of sediment at the Connecticut port would cost $4 million to $6 million."I can't remember the last time we've seen prices this low on a job of this size," said Ray Francisco, a project manager at the corps' regional headquarters in Waltham, Mass.

While the Great Lakes bid was low, it was not a fluke. Of the five competitors for the job, four submitted bids of $3.6 million or less, yielding a substantial savings for the corps and the taxpayer. Contractors say the bargain bids are just a case of supply and demand.

"The industry's hungry right now," said George Strawn, area engineer for Great Lakes.

Big dredging projects in New England are so rare that they always are likely to foster competition. But the industry's hunger and low rates on the East Coast are limited to the type of job and equipment used, officials said.

While "bucket" dredges like the one to be used at New Haven are standing idle, "hopper" dredges such as those needed to complete the dredging job at Port Elizabeth, N.J., are in great demand.

Bucket dredges, which are operated from barge-mounted cranes, are suited for channel work in relatively calm waters, said Hal Hawkins, the corps' chief of navigation in New York.

Hopper dredges mounted in special ships are used in rougher open waters to drag the bottom for clean fill that can be used as cap material, Mr. Hawkins said.

At the moment, all available hopper dredges are being rushed to New Jersey so dioxin-tainted sediment from Port Elizabeth can be capped with clean sand at the nearby offshore Mud Dump disposal site.

Meanwhile, permits for 40 other jobs are being held up by court order until the success of the capping is evaluated, Mr. Hawkins said. The slowdown has added to the idling of bucket dredge equipment.

The uneven flow of projects and equipment utilization due to environmental regulation has come along at the right time for New Haven.

While the inner harbor also contains contaminated sediment, it is considered far less hazardous and the capping using dredge material from the outer harbor is more routine.

Although rates for such jobs are falling, prices are rising on more-complex jobs with environmental risks and restrictions. Overall, dredging costs have been increasing across the country, said George Halford, a corps spokesman in Washington.