2001-07-20                     House Journal                      Page 1908
HB 244                                                                                            
The following letter, dated July 5, 2001, was received:                                             
                                                                                                    
"Dear Speaker Porter:                                                                               
                                                                                                    
Under the authority of art. II, sec. 15, of the Alaska Constitution, I                              
have vetoed the following bill:                                                                     
                                                                                                    
      SENATE CS FOR CS FOR HOUSE BILL NO. 244(RES)                                                  
      "An Act relating to a grant of state land to the Denali Borough for                           
      a railroad and utility corridor and a railroad development project;                           
      repealing provisions relating to a grant of a right-of-way of land                            
      for a railroad and utility corridor to the Alaska Industrial                                  
      Development and Export Authority; and providing for an effective                              
      date."                                                                                        
                                                                                                    
The bill requires the transfer of 3,500 acres of state land to the Denali                           
Borough for subsequent lease to Kantishna Holdings, Inc. to provide a                               
railroad and utility corridor for the design, construction, operation, and                          
maintenance of a railroad.  The corridor would run from near Healy to                               
the eastern boundary of Denali National Park and Preserve.  The bill                                
requires the borough to lease the land by September 1, 2010, or it will                             
revert to the state.                                                                                
                                                                                                    
Throughout my term as governor, I have supported the development of                                 
increased access to Denali National Park and Preserve.  In 1998, I                                  
signed House Bill 386 authorizing the Department of Natural                                         
Resources to grant state land to the Alaska Industrial Development and                              

2001-07-20                     House Journal                      Page 1909
Export Authority (AIDEA) for the purpose of financing a project                                     
enabling Kantishna Holdings, Inc. to develop a railroad corridor.  The                              
1998 law allowed for public review, consideration of economic                                       
feasibility, and allowed the state to impose appropriate conditions.                                
The law also authorized AIDEA to issue up to $28,000,000 in bonds to                                
finance the project.  This bill would repeal the authority to analyze and                           
implement a joint private and public project.                                                       
                                                                                                    
This year's capital budget includes a $1.65 million appropriation to the                            
Department of Transportation and Public Facilities for planning,                                    
reconnaissance, and environmental analysis for a proposed northern                                  
access into Denali National Park and Preserve.  The planning process                                
will also assure the public's ability to participate in the final decision                          
of whether to construct a road or a railroad, and in the decision of                                
where best to route the project so as to achieve its goals.                                         
                                                                                                    
The goal of this bill -- enhanced access to Denali National Park and                                
Preserve -- may be laudable, but the process presented here is                                      
seriously flawed in the following ways:                                                             
                                                                                                    
      · It violates the public process by disposing of significant                                
            state resources without adequate safeguards of the public                               
            interest, including opportunity for thorough public hearings                            
            and comment.                                                                            
      · It violates the competitive bid processes of the state by                                 
            designating a land lease recipient (Kantishna Holdings, Inc.)                           
                     and bypassing the legal process for leasing state lands.                      
      · It violates and is inconsistent with the Department of                                    
            Natural Resources land use planning process.                                          
      · It transfers lands of undeniable state-wide and national                                  
            interest to a borough which currently lacks adequate                                  
            authority or capacity to administer transportation services or                          
            to conduct land planning and zoning.                                                    
      · It is premature and could be endorsing construction of a                                  
            railroad to nowhere.  The National Park Service has not                               
            designated an additional access point into the park.  This                              
            railroad, if built, could literally end at the park boundary with                       
            no real destination.                                                                    
                                                                                                    
                                                                                                    

2001-07-20                     House Journal                      Page 1910
I continue to believe the basic premise of this bill, the development of                            
alternative access to Denali Park, is in the best interests of the state.                           
However, this goal will not be achieved without appropriate planning,                               
public participation, participation by the federal landowner,                                       
appropriate financing, and fair competition.  I veto this bill to allow                             
that process to proceed, using the money appropriated this year for that                            
purpose.                                                                                            
                                                                                                    
                                            Sincerely,                                             
                                          /s/                                                       
                                          Tony Knowles                                              
                                             Governor"