Legislature(1999 - 2000)

02/02/1999 01:05 PM House TRA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
                                                                                                                                
SSHB 12 - RAIL/UTILITY EASEMENT TO AK-CANADA BORDER                                                                             
                                                                                                                                
CHAIR MASEK announced the next order of business was Sponsor                                                                    
Substitute for House Bill 12, "An Act relating to an easement for                                                               
the extension of the Alaska Railroad to the Alaska-Canada border."                                                              
                                                                                                                                
Number 1300                                                                                                                     
                                                                                                                                
REPRESENTATIVE JEANETTE JAMES, Alaska State Legislature, read the                                                               
following sponsor statement into the record:                                                                                    
                                                                                                                                
     Why is this bill necessary?  Many of you were around here when                                                             
     I did this for establishing or authorizing a corridor from                                                                 
     Fairbanks to the Seward Peninsula, and at that time we already                                                             
     had an identified corridor between Eielson Air Force Base and                                                              
     the Canadian Border which was deleted in 1995.                                                                             
                                                                                                                                
     In 1982, a corridor was delineated by statute connecting                                                                   
     Alaska's existing railroad with the Canadian border.  In 1994,                                                             
     I sponsored and passed HB 184 authorizing $10,000 for a study                                                              
     determining the cost of acquiring the right-of-way within that                                                             
     corridor.  In 1995, the Department of Transportation (DOT)                                                                 
     reached a cost estimate of $6,363,000 to acquire the                                                                       
     right-of-way.  Of the $10,000 appropriated by HB 184 for this                                                              
     study, a total of $7,876 was expended.                                                                                     
                                                                                                                                
     On May 5, 1996, the 1982 application to the Bureau of Land                                                                 
     Management (BLM) was withdrawn by order of DOT due to "lack of                                                             
     interest," in spite of my 1994 legislation which certainly                                                                 
     indicated a continuing interest.  This was the purpose of my                                                               
     1994 legislation, to keep that alive, but it didn't work.                                                                  
                                                                                                                                
     In 1999, SSHB 12 re-authorizes delineation of the corridor,                                                                
     subject to legislative appropriation.  Thus this bill carries                                                              
     no fiscal impact.  It merely re-authorizes and updates the                                                                 
     1982 statute.                                                                                                              
                                                                                                                                
     I might insert here that the delineation of the corridor that                                                              
     was done in 1982 was a basic delineation by aircraft                                                                       
     identifying a center line from Eielson to the Canadian border.                                                             
     No surveys and no other exercises, except the estimate of how                                                              
     much it would cost to acquire the right-of-way within it, have                                                             
     been done.                                                                                                                 
                                                                                                                                
     Both the Canadian and Russian governments, as well as our own,                                                             
     are increasingly interested in a United States-Asia link via                                                               
     rail through Alaska.  SSHB 12 allows eventual funding from any                                                             
     source, private or governmental, and I want the authorization                                                              
     on the books now so we aren't scrambling for it when or if                                                                 
     project funds become available.                                                                                            
                                                                                                                                
     Advantages to Alaska are obvious:  resource development,                                                                   
     tourism, job opportunities for ALL areas of Alaska, with                                                                   
     controlled access and without the expensive maintenance                                                                    
     problems of other modes of transportation.                                                                                 
                                                                                                                                
Number 1445                                                                                                                     
                                                                                                                                
REPRESENTATIVE JAMES reiterated that she has been a long-standing                                                               
advocate for rail access as surface transportation to connect our                                                               
resources in the state of Alaska.  She argued that rail access is                                                               
more environmentally friendly.  She added that controlled rail                                                                  
access does not carry with it the problems that highways and roads                                                              
do, such as the need for emergency services, state troopers and                                                                 
garbage pick up.                                                                                                                
                                                                                                                                
REPRESENTATIVE JAMES pointed out that she has removed the "Eielson                                                              
Air Force Base to the Canadian border" inference in this bill,                                                                  
because it is her belief that the corridor should be in the best                                                                
route available.  She reported on meeting in Anchorage with                                                                     
interested individuals from the Yukon Territory, and they agreed to                                                             
meet again this spring in Whitehorse.  They defined some of the                                                                 
economic benefits to include: entering into lease agreements with                                                               
coal fields, increased tourism, and tapping into the approximately                                                              
2500 tankers per year that Mapco alone sends into the Yukon                                                                     
Territory.                                                                                                                      
                                                                                                                                
Number 1575                                                                                                                     
                                                                                                                                
REPRESENTATIVE JAMES added that there may be some federal funding                                                               
available if public support was raised; however, there is a current                                                             
zero fiscal note.  She clarified that the additions to the zero                                                                 
fiscal note estimate what the cost would be to actually delineate                                                               
this corridor, and any appropriation for that figure would have to                                                              
be set in a separate bill or through the budget process.  She                                                                   
reiterated that SSHB 12 does not ask for this money, but simply                                                                 
asks that the bill be on the record.  She believes that a long-term                                                             
fiscal note of the implications of this rail access would be very                                                               
positive for the state of Alaska.                                                                                               
                                                                                                                                
Number 1641                                                                                                                     
                                                                                                                                
REPRESENTATIVE COWDERY asked who the primary land owners would be                                                               
for such a corridor.                                                                                                            
                                                                                                                                
REPRESENTATIVE JAMES explained that would be determined once the                                                                
location of the route was established; however, she would assume                                                                
that there would be a mix of state land, Native-owned land, BLM                                                                 
land, and a small amount of privately-owned land.  She anticipates                                                              
negotiations of land trades for those who may not want to sell                                                                  
outright.                                                                                                                       
                                                                                                                                
REPRESENTATIVE COWDERY inquired as to the width of the corridor.                                                                
                                                                                                                                
REPRESENTATIVE JAMES clarified that the bill provides for 500 feet                                                              
of a right-of-way transportation corridor, and the railway corridor                                                             
would be within that 500 feet.  The old bill, she stipulated, had                                                               
a right-of-way of 300 feet.                                                                                                     
                                                                                                                                
REPRESENTATIVE COWDERY related that his experience in the                                                                       
construction field has led him to believe certain areas containing                                                              
steep hills might require additional right-of-way width; however,                                                               
he emphasized that special construction easements could be                                                                      
obtained.                                                                                                                       
                                                                                                                                
REPRESENTATIVE JAMES added that identification of material sites                                                                
would also be asked for along the way.                                                                                          
                                                                                                                                
Number 1760                                                                                                                     
                                                                                                                                
REPRESENTATIVE COWDERY asked if the 1995 figure of $6,363,000 was                                                               
determined by a DOT/PF estimate.                                                                                                
                                                                                                                                
REPRESENTATIVE JAMES confirmed that, and further explained that the                                                             
figure was reached by using the value of the existing ownership                                                                 
within the identified corridor.                                                                                                 
                                                                                                                                
CHAIR MASEK wondered about the $3.2 million figure mentioned as a                                                               
1982 estimate.  She inquired as to whether or not that figure would                                                             
be greatly increased now that it is 1999.                                                                                       
                                                                                                                                
REPRESENTATIVE JAMES examined the various costs mentioned                                                                       
throughout this process.  One of the costs, she explained, was to                                                               
identify the corridor.  After that time, the ownership value of the                                                             
land needs to be determined, which would require additional survey                                                              
costs.  She emphasized, however, that the actual distance in Alaska                                                             
is relatively short compared to the distance required from the                                                                  
Canadian border to connect with British Columbia (BC) Railway.  In                                                              
1982, BC Railway began the process by laying rail towards Alaska.                                                               
It would need to be determined, she added, if the old plans and                                                                 
existing rail can still be used.  This can be done at a later date,                                                             
however, when the state legislature is ready to appropriate either                                                              
state, private, federal or international funds.                                                                                 
                                                                                                                                
Number 1880                                                                                                                     
                                                                                                                                
REPRESENTATIVE HUDSON questioned whether or not the sponsor                                                                     
substitute for HB 12 was ever officially adopted.                                                                               
                                                                                                                                
REPRESENTATIVE JAMES clarified that the sponsor substitute had been                                                             
read across and was the bill before the committee.                                                                              
                                                                                                                                
Number 1905                                                                                                                     
                                                                                                                                
REPRESENTATIVE ANDREW HALCRO asked, "With all the federal dollars                                                               
that now seem to be coming into the state -- I know that the                                                                    
railroad just received $28 million for an airport project they are                                                              
aiming to do -- what is the likelihood of this coming to fruition                                                               
in the next ten years?"                                                                                                         
                                                                                                                                
REPRESENTATIVE JAMES informed the committee that she had asked                                                                  
United States Senator Ted Stevens that same question "a couple of                                                               
months ago," and he indicated that public support would be a key                                                                
factor.  She noted that there is more interest in this now,                                                                     
especially in the rural communities, than when she first began                                                                  
talking about this project.                                                                                                     
                                                                                                                                
Number 1970                                                                                                                     
                                                                                                                                
REPRESENTATIVE KEMPLEN inquired if the legislature has ever passed                                                              
a resolution asking the United States Congress to provide funding                                                               
for expansion of the Alaska Railroad eastward to Canada as a matter                                                             
of national interest.                                                                                                           
                                                                                                                                
REPRESENTATIVE JAMES replied that this had not been the case since                                                              
the 1982 legislation; however, she could not comment on dates                                                                   
previous to that time.  She reiterated that there are a lot more                                                                
supporters on this issue now, and it was her belief that such a                                                                 
resolution might be a worthwhile effort within the next two years.                                                              
                                                                                                                                
REPRESENTATIVE KEMPLEN commented that a resolution asking Congress                                                              
to appropriate money for the right-of-way and for construction                                                                  
would be a good way of showing public support for this initiative.                                                              
                                                                                                                                
REPRESENTATIVE JAMES emphasized that this would all have to be done                                                             
in conjunction with the Canadians.  Drafting the language of such                                                               
a resolution might be premature until there is an enthusiastic                                                                  
partnership on both sides of the border; however, the committee was                                                             
again reminded of the April meeting in Whitehorse.                                                                              
                                                                                                                                
REPRESENTATIVE KEMPLEN called attention to the fact that Congress                                                               
did appropriate funding for the "Alcan Highway"; consequently,                                                                  
there is precedent for that type of initiative.                                                                                 
                                                                                                                                
REPRESENTATIVE JAMES agreed that the such a partnership would be                                                                
possible.                                                                                                                       
                                                                                                                                
Number 2110                                                                                                                     
                                                                                                                                
RUSSELL BOWDRE testified via teleconference from Delta Junction.                                                                
He said, "I would just like to state for the record that I do not                                                               
know anybody in our area who would be opposed to this railroad.  If                                                             
there is anyone, I have not talked to them or heard anything from                                                               
them.  I think you would receive unanimous support all the way from                                                             
Tok to Fairbanks and in this area.  Anything that would could do to                                                             
help you and encourage this, I would like very much for you to let                                                              
us know.  We would be glad to volunteer our time and effort to give                                                             
you a hand."                                                                                                                    
                                                                                                                                
Number 2165                                                                                                                     
                                                                                                                                
LAUREL BARGER-SHEEN, Department of Economic Development, City of                                                                
Delta Junction, testified via teleconference in favor of SSHB 12.                                                               
She read the following written testimony into the record:                                                                       
                                                                                                                                
     For those of you considering this bill, please allow this                                                                  
     letter/statement to represent the interest and desire of the                                                               
     residents of the Delta region to encourage the expansion of                                                                
     the Alaska Railroad in an effort to expand the opportunities                                                               
     for Alaskans and further ratify NAFTA [North American Free                                                                 
     Trade Agreement].  This action would open Alaska to                                                                        
     unprecedented growth and bring us closer to our member nation.                                                             
     It would allow citizens of the Lower 48 to enjoy a part of                                                                 
     their country they may have never seen before due to the                                                                   
     increased accessibility a rail line would offer.                                                                           
                                                                                                                                
     Our community is at the juncture of two of Alaska's major                                                                  
     highways (the "Alcan" and the Richardson) and the base of the                                                              
     Alaska Range.  The natural beauty and vastness of the area is                                                              
     unique; one we would like to share with other Alaskans and                                                                 
     visitors.  The railroad offers an environmentally friendly                                                                 
     alternative to the growth Alaska will experience.  It promotes                                                             
     responsible development of the area and has the potential to                                                               
     impact every aspect of life in Alaska positively.                                                                          
                                                                                                                                
     Successful development of Alaska's resources can only be                                                                   
     achieved with an investment in her infrastructure, this type                                                               
     of infrastructure.  This rail corridor is needed to open a                                                                 
     "gateway to the Interior" to support the new "gold rush" and                                                               
     other natural resource industries, as well as providing                                                                    
     opportunities for our Canadian neighbors.  Give Alaskans the                                                               
     opportunity to compete in a world market.  Help us build this                                                              
     line.                                                                                                                      
                                                                                                                                
MS. BARGER-SHEEN went on to ask a question regarding the                                                                        
preliminary site survey conducted in 1982.  She wondered if the                                                                 
committee had considered this survey in their deliberations.                                                                    
                                                                                                                                
Number 2248                                                                                                                     
                                                                                                                                
REPRESENTATIVE JAMES agreed that there would be some benefit to                                                                 
having that survey; however, there are potential changes in land or                                                             
ownership that would have be taken into consideration.  This survey                                                             
can be used, she stated, but may not represent the only way to go.                                                              
                                                                                                                                
MS. BARGER-SHEEN informed the committee of their attempts to go                                                                 
forward with a private partnership through Mr. Bill Sheffield at                                                                
the Alaska Railroad Corporation.  She volunteered any information                                                               
she might have or dedicating any time needed to get this project                                                                
moved forward.  She recommended that Mr. Sheffield be invited to                                                                
the Whitehorse meeting.                                                                                                         
                                                                                                                                
REPRESENTATIVE JAMES assured her that Mr. Sheffield is on the list                                                              
to be invited.                                                                                                                  
                                                                                                                                
DENNIS POSHARD, Legislative Liaison/Special Assistant, Office of                                                                
the Commissioner, Department of Transportation and Public                                                                       
Facilities (DOT/PF), testified regarding the fiscal note for SSHB
12.  The bill carries a zero fiscal note, he explained, because it                                                              
is subject to appropriation.  It was the intent to give a good cost                                                             
estimate what SSHB 12 would ask the DOT/PF to do in order to                                                                    
delineate a corridor; however, the estimates are based on the 1982                                                              
study with no major route changes. There is a high probability, he                                                              
noted, that there will be some necessary route changes due to land                                                              
status modifications.                                                                                                           
                                                                                                                                
Number 2388                                                                                                                     
                                                                                                                                
FORMER GOVERNOR BILL SHEFFIELD, President and CEO, Alaska Railroad                                                              
Corporation, testified via teleconference from Anchorage on SSHB
12.  He emphasized that, even though we are at the end of the                                                                   
twentieth century, Alaska is still a growing frontier that requires                                                             
foresight of the "big picture" to set the stage for long-term                                                                   
growth.  It is his opinion that this bill is a good example of                                                                  
that, and that now is the time to "draw the straightest and best                                                                
line to the Canadian border" before there are a lot of impediments.                                                             
Knowing the right-of-way is in place, he added, might spur                                                                      
development by people who also want to be a part of that growth.                                                                
In addition, potential missile defense systems sites, as well as                                                                
current and future mine locations, would also benefit from this                                                                 
railroad.                                                                                                                       
                                                                                                                                
Tape 99-04, Side B                                                                                                              
Number 0028                                                                                                                     
                                                                                                                                
GOVERNOR SHEFFIELD referred to a map showing the existing rail line                                                             
of British Columbia (BC) Railway "going up as far as Chipmunk,                                                                  
which is above Fort St. James, and about halfway to Dease Lake."                                                                
He estimated that it was approximately 400 miles from Fairbanks to                                                              
Whitehorse, and a little less than that to the Canadian border.                                                                 
The viability would be enhanced, he added, if the Canadians                                                                     
extended their line at the same time.  He agreed that the project                                                               
would cost a lot of money, but reiterated that this would be a                                                                  
concern for a future day.  He emphasized that the important thing                                                               
would be to get the right-of-way set out at this time.  He updated                                                              
the committee on current Alaska Railroad Corporation right-of-way                                                               
projects in other parts of the state that demonstrated their                                                                    
resolve to look toward the future.                                                                                              
                                                                                                                                
GOVERNOR SHEFFIELD disclosed that the British Columbia Railway has                                                              
lost about 40 percent of its coal tonnage in 1998 for export to                                                                 
Japan, and their contract comes up for contract re-negotiation in                                                               
April of 1999.  The Japanese, he reported, want to lower price                                                                  
concessions for the Canadians, and any future coal contract for                                                                 
Alaska would probably be at a much lower price as well.                                                                         
                                                                                                                                
Number 0162                                                                                                                     
                                                                                                                                
GOVERNOR SHEFFIELD indicated that rail line construction is                                                                     
estimated to be about $2.75 million per mile.  By multiplying this                                                              
by 500 miles, a fairly good total estimate could be made.  However,                                                             
he continued, the first step would be to outline the route, and                                                                 
work with British Columbia Railway and the governments of British                                                               
Columbia and the Yukon to acquire the right-of-way.  If cooperation                                                             
is achieved and it makes sense to build it, the funding could be                                                                
found at that time.                                                                                                             
                                                                                                                                
Number 0209                                                                                                                     
                                                                                                                                
CHAIR MASEK asked if the House Transportation Standing Committee                                                                
could be provided with a copy of the map that was previously                                                                    
referred to.                                                                                                                    
                                                                                                                                
JAMES B. BLASINGAME, Vice President of Corporate Affairs, Alaska                                                                
Railroad Corporation, previously introduced by Governor Sheffield                                                               
via teleconference, responded that the map was an older map they                                                                
received from the British Columbia Railway System, and that he                                                                  
would be happy to forward a copy to the committee.                                                                              
                                                                                                                                
GOVERNOR SHEFFIELD added that there is money in the federal budget                                                              
to do a transportation study administered by DOT/PF from Fairbanks                                                              
to the Arctic, as well as to look at a rail line from Chitina to                                                                
Cordova, and a rail line into McKinley.                                                                                         
                                                                                                                                
REPRESENTATIVE HALCRO noted that the original estimate for the cost                                                             
of right-of-way in 1982 was $3.2 million, and 13 years later it had                                                             
doubled to $6.3 million.  He expressed concern that the figure                                                                  
might be well over $10 million in the next five or six years.  He                                                               
asked if any effort was being made to apply federal funds to                                                                    
procure right-of-way in the next year or two.                                                                                   
                                                                                                                                
GOVERNOR SHEFFIELD indicated that the money received has to be                                                                  
applied to the specific items it was appropriated for; however, the                                                             
state of Alaska could apply specifically for additional funding                                                                 
through the DOT/PF.                                                                                                             
                                                                                                                                
Number 0446                                                                                                                     
                                                                                                                                
REPRESENTATIVE JERRY SANDERS wondered if the 500 miles previously                                                               
quoted as costing $2.75 million per mile were all located in                                                                    
Alaska.                                                                                                                         
                                                                                                                                
GOVERNOR SHEFFIELD estimated that approximately one-third to a                                                                  
little less than half of those miles would be in the Yukon.                                                                     
                                                                                                                                
CHAIR MASEK thanked Governor Sheffield, and returned to Mr. Poshard                                                             
from the DOT/PF to continue his testimony.                                                                                      
                                                                                                                                
Number 0500                                                                                                                     
                                                                                                                                
REPRESENTATIVE HUDSON asked Mr. Poshard if the DOT/PF's Division of                                                             
Statewide Planning was currently working on advancing these kind of                                                             
long-range plans.                                                                                                               
                                                                                                                                
MR. POSHARD assured the committee that the DOT/PF is currently                                                                  
working on long-range plans, but not specifically related to the                                                                
railroad.  They have mainly undertaken regional plans in six                                                                    
regions throughout the state which look at which form(s) of                                                                     
transportation would be the most effective in each region.                                                                      
                                                                                                                                
Number 0600                                                                                                                     
                                                                                                                                
REPRESENTATIVE COWDERY wondered if the railroad has acquired any                                                                
additional right-of-ways since 1983.                                                                                            
                                                                                                                                
MR. POSHARD referred the question to the Alaska Railroad                                                                        
Corporation.                                                                                                                    
                                                                                                                                
ERNIE PIPER, Alaska Railroad Corporation, provided testimony on                                                                 
behalf of Governor Sheffield and Mr. Blasingame, who were unable to                                                             
remain on teleconference.  He stated that the lines being worked on                                                             
currently will require some right-of-way changes, but there has not                                                             
been any new right-of-way acquired.                                                                                             
                                                                                                                                
REPRESENTATIVE COWDERY wondered if any expansion was being planned                                                              
to Western Alaska.                                                                                                              
                                                                                                                                
MR. PIPER said no.  He indicated that United States Senator Frank                                                               
Murkowski was very interested in that; however, such a project                                                                  
would require a lot of movement across federal lands.                                                                           
                                                                                                                                
REPRESENTATIVE COWDERY noted that the Wishbone Hill area in the                                                                 
Matanuska Valley has the potential for some high-grade coal.  He                                                                
stated that there used to be a corridor in that area, but he                                                                    
believed some of the right-of-way was currently in the Matanuska                                                                
River.  He asked if there were any plans to develop it and how wide                                                             
it is.                                                                                                                          
                                                                                                                                
MR. PIPER stated that the right-of-way was still there, and assured                                                             
Representative Cowdery that he would inform him of the width of the                                                             
corridor and any further information regarding it.                                                                              
                                                                                                                                
Number 0755                                                                                                                     
                                                                                                                                
CHAIR MASEK questioned why the DOT/PF closed their application in                                                               
1996.                                                                                                                           
                                                                                                                                
MR. POSHARD reported that the DOT/PF received a phone call from the                                                             
BLM asking if they were serious about acquiring the land.  Since                                                                
there was no appropriation on the books from either the federal or                                                              
the state government, the staff made the decision to allow BLM to                                                               
take those applications off the table and close the files.                                                                      
                                                                                                                                
REPRESENTATIVE HALCRO pointed out that this type of an easement                                                                 
would fall into a long-range transportation plan.                                                                               
                                                                                                                                
MR. POSHARD agreed that this is the type of thing the DOT/PF will                                                               
be looking at; however, he emphasized that they never owned or                                                                  
acquired any of that property at that time.  It was his belief that                                                             
the individual who made the decision to close the files felt that                                                               
it was unlikely the railroad was to be constructed any time soon.                                                               
He added that, given the circumstances, the same decision might not                                                             
have been made today.                                                                                                           
                                                                                                                                
Number 0885                                                                                                                     
                                                                                                                                
MR. BOWDRE from Delta Junction asked a follow-up question.  He                                                                  
wondered how much research had been done in talking to the                                                                      
different entities that would benefit from this railroad to see                                                                 
what their potential use would be.  He cited various examples of                                                                
organizations that he felt should be contacted.                                                                                 
                                                                                                                                
REPRESENTATIVE JAMES replied that there were no actual paper                                                                    
tallies; however, they are actively involved in the talking stages.                                                             
She reported that she had spoken to the transportation committee                                                                
chair at the Fairbanks Chamber of Commerce that morning, and                                                                    
reminded everyone that the April meeting in Whitehorse would                                                                    
include many of these individuals.  The Delta Junction and Tok                                                                  
Chambers of Commerce, she added, would also be invited to the                                                                   
Whitehorse meeting.                                                                                                             
                                                                                                                                
Number 1024                                                                                                                     
                                                                                                                                
CHAIR MASEK asked for further testimony.  Hearing none, she asked                                                               
if there were any motions from the committee to entertain.                                                                      
                                                                                                                                
REPRESENTATIVE HALCRO made a motion to move SSHB 12 out of                                                                      
committee with individual recommendations and the attached zero                                                                 
fiscal note(s), and asked unanimous consent. There being no                                                                     
objection, SSHB 12 has been moved from House Transportation                                                                     
Standing Committee.                                                                                                             
                                                                                                                                

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