Legislature(2003 - 2004)

01/28/2003 11:09 AM MLV

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                    ALASKA STATE LEGISLATURE                                                                                  
            HOUSE SPECIAL COMMITTEE ON MILITARY AND                                                                           
                       VETERANS' AFFAIRS                                                                                      
                        January 28, 2003                                                                                        
                           11:09 a.m.                                                                                           
MEMBERS PRESENT                                                                                                               
Representative Bob Lynn, Chair                                                                                                  
Representative Beverly Masek, Vice Chair                                                                                        
Representative Nancy Dahlstrom                                                                                                  
Representative Hugh Fate                                                                                                        
Representative Bruce Weyhrauch                                                                                                  
Representative Sharon Cissna                                                                                                    
Representative Max Gruenberg                                                                                                    
MEMBERS ABSENT                                                                                                                
All members present                                                                                                             
OTHER LEGISLATORS PRESENT                                                                                                     
Representative John Coghill                                                                                                     
COMMITTEE CALENDAR                                                                                                            
HOUSE CONCURRENT RESOLUTION NO. 2                                                                                               
Relating to the extension of the Alaska Railroad to Fort Greely                                                                 
to serve the anti-ballistic missile launch facility.                                                                            
     - FAILED TO MOVE CSHCR 2(MLV) OUT OF COMMITTEE                                                                             
PREVIOUS ACTION                                                                                                               
BILL: HCR 2                                                                                                                   
SHORT TITLE:EXTEND ALASKA RAILROAD TO FT. GREELY                                                                                
SPONSOR(S): REPRESENTATIVE(S)LYNN                                                                                               
Jrn-Date   Jrn-Page                     Action                                                                                  
01/21/03     0024       (H)        READ THE FIRST TIME -                                                                        
01/21/03     0024       (H)        MLV                                                                                          
01/21/03     0024       (H)        REFERRED TO MLV                                                                              
01/24/03     0065       (H)        COSPONSOR(S): HOLM                                                                           
01/28/03                (H)        MLV AT 11:00 AM MAJORITY                                                                     
                                   CAUCUS RM                                                                                    
WITNESS REGISTER                                                                                                              
FATHER THOMAS MOFFATT, Staff                                                                                                    
to Representative Bob Lynn                                                                                                      
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION  STATEMENT:   Testified  briefly  on  HCR 2,  which  was                                                               
sponsored by Representative Lynn.                                                                                               
MICHAEL A. BARTON, Acting Commissioner                                                                                          
Department of Transportation & Public Facilities (DOT&PF)                                                                       
Juneau, Alaska                                                                                                                  
POSITION  STATEMENT:    During  hearing on  HCR  2,  offered  the                                                               
governor's  support for  an  extension of  the  railroad to  Fort                                                               
Greely,  which would  not only  provide access  for defense,  but                                                               
also would benefit mining and agriculture.                                                                                      
PATRICK  GAMBELL, President  and  Chief  Executive Officer  (CEO)                                                               
Alaska Railroad Corporation (ARRC)                                                                                              
Department of Community & Economic Development                                                                                  
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  During hearing  on HCR 2, stated his support                                                               
and that of  Bill O'Leary for extending the line  to Fort Greely,                                                               
which would  be about  a 15-percent  growth for  the corporation;                                                               
answered questions.                                                                                                             
ACTION NARRATIVE                                                                                                              
TAPE 03-1, SIDE A                                                                                                             
CHAIR BOB  LYNN called  the House  Special Committee  on Military                                                             
and   Veterans'  Affairs   meeting   to  order   at  11:09   a.m.                                                               
Representatives  Lynn,  Masek,  Weyhrauch, Dahlstrom,  Fate,  and                                                               
Gruenberg  were present  at the  call to  order.   Representative                                                               
Cissna  arrived  as  the  meeting  was  in  progress.    Also  in                                                               
attendance was Representative John Coghill.                                                                                     
[Chair Lynn led participants in  saying the Pledge of Allegiance.                                                               
He  then facilitated  discussion by  individual members  of their                                                               
interest in and involvement with military issues.]                                                                              
HCR 2-EXTEND ALASKA RAILROAD TO FT. GREELY                                                                                    
11:21 a.m.                                                                                                                      
CHAIR  LYNN announced  that the  committee  would consider  HOUSE                                                               
CONCURRENT RESOLUTION  NO. 2,  Relating to  the extension  of the                                                               
Alaska  Railroad  to  Fort Greely  to  serve  the  anti-ballistic                                                               
missile launch facility.  As the  prime sponsor of HCR 2, he read                                                               
the resolution to the committee.                                                                                                
11:23 a.m.                                                                                                                      
REPRESENTATIVE DAHLSTROM moved to adopt Amendment 1, labeled 23-                                                                
LS0157\D.1, Utermohle, 1/28/03, which read:                                                                                     
     Page 1, line 8:                                                                                                            
          Delete "killer"                                                                                                       
          Insert "defense"                                                                                                      
There being no objection, it was so ordered.                                                                                    
REPRESENTATIVE  MASEK moved  to  adopt Amendment  2, labeled  23-                                                               
LS0157\D.2, Utermohle, 1/28/03, which read:                                                                                     
     Page 1, line 4:                                                                                                            
          Delete "Air Force"                                                                                                    
          Insert "Department of Defense"                                                                                        
There being no objection, it was so ordered.                                                                                    
CHAIR  LYNN called  the preceding  "housekeeping amendments"  and                                                               
indicated  further   amendments  could  be  entertained   at  any                                                               
appropriate point.                                                                                                              
11:26 a.m.                                                                                                                      
FATHER THOMAS  MOFFATT, Staff to Representative  Bob Lynn, Alaska                                                               
State  Legislature,  pointed   out  that  HCR  2   has  18  House                                                               
cosponsors thus  far.  Noting  that extension of the  railroad to                                                               
Fort  Greely was  mentioned "rather  strongly" in  the governor's                                                               
recent State  of the  State address, he  offered his  belief that                                                               
the resolution  adequately encompasses  the governor's  views, as                                                               
well as  the feelings of  the legislature.   He called it  a good                                                               
start  towards getting  the railroad  through Canada  and finally                                                               
down to the Lower 48.                                                                                                           
11:28 a.m.                                                                                                                      
MICHAEL   A.   BARTON,   Acting   Commissioner,   Department   of                                                               
Transportation  & Public  Facilities  (DOT&PF),  came forward  to                                                               
testify, noting that he is an  Army veteran.  He informed members                                                               
that  clearly the  governor supports  extending  the railroad  to                                                               
Fort  Greely.     The  project  would  assist   the  military  in                                                               
implementing   the   new   missile-defense   system,   he   said,                                                               
emphasizing the  need to support  the military in  protecting the                                                               
country.  It also would  help the mining and agricultural sectors                                                               
of the economy  and would be an important part  of developing the                                                               
state's transportation.   "We  look forward  to working  with the                                                               
railroad  and the  Bush  Administration to  make  it happen,"  he                                                               
11:29 a.m.                                                                                                                      
REPRESENTATIVE GRUENBERG asked whether  the railroad bed would be                                                               
capable of [transporting materials]  for mining activities, which                                                               
are  much  harder on  a  railroad  bed  than  would be  just  the                                                               
transportation of  missiles.   He acknowledged  that it  might be                                                               
better to ask Mr. Gambell [of ARRC].                                                                                            
ACTING COMMISSIONER BARTON deferred to Mr. Gambell.                                                                             
11:30 a.m.                                                                                                                      
REPRESENTATIVE CISSNA  followed up,  inquiring whether  there are                                                               
other  ways to  further  use the  railroad to  aid  the state  in                                                               
development.   She asked  if Acting  Commissioner Barton  knew of                                                               
any studies regarding a railroad extension and its impacts.                                                                     
ACTING COMMISSIONER  BARTON answered  that he  is sure  there are                                                               
[other ways  to further  use the railroad],  as well  as studies,                                                               
although he  isn't personally  acquainted with  those.   He noted                                                               
that it  has been  an ongoing  effort for  some time,  though not                                                               
necessarily for  this particular segment.   He offered  to obtain                                                               
11:31 a.m.                                                                                                                      
REPRESENTATIVE MASEK  referred to page  2, lines 4-6,  which says                                                               
in part  that "the Alaska Railroad  has a long and  proud history                                                               
of providing transportation  services to the armed  forces of the                                                               
United  States".   She said  it is  crucial to  begin looking  at                                                               
better access in the state,  especially for the military; it will                                                               
then open up a lot of  areas.  She offered her understanding that                                                               
some  [federal] money  seems to  be earmarked,  and that  perhaps                                                               
this railroad  [extension] would  fit into that.   She  said this                                                               
resolution  speaks highly  for  [the  legislature's] support  for                                                               
better access.                                                                                                                  
CHAIR  LYNN surmised  that  it would  greatly  benefit the  Delta                                                               
Junction area as well.                                                                                                          
ACTING  COMMISSIONER  BARTON  replied  that   it  has  a  lot  of                                                               
benefits, in a lot of ways and  [to] a lot of people.  Mentioning                                                               
economic   development   through  resource   and   transportation                                                               
development, he said the governor  is very committed to providing                                                               
access to Alaskans,  as well as providing  some transportation in                                                               
rural areas for  the sake of better lives for  rural residents in                                                               
terms of schools, health care, and access.                                                                                      
11:34 a.m.                                                                                                                      
PATRICK  GAMBELL, President  and Chief  Executive Officer  (CEO),                                                               
Alaska  Railroad Corporation  (ARRC), Department  of Community  &                                                               
Economic Development,  came forward to testify,  noting that with                                                               
him at  the hearing  were Bill  O'Leary, chief  financial officer                                                               
and vice president  of finance, and Wendy  Lindskoog.  Mentioning                                                               
his  own extensive  military  background,  Mr. Gambell  indicated                                                               
he'd  been asked  to be  an advisor  to [the  U.S. Department  of                                                               
Homeland Security]  in Alaska.   He said committee  members would                                                               
hear [from  ARRC] the  practical side  of things,  and presumably                                                               
would  want  the  railroad  to provide  the  best  technical  and                                                               
practical advice possible from an  engineering and planning point                                                               
of view.                                                                                                                        
MR.  GAMBELL  conveyed his  and  Mr.  O'Leary's support  for  the                                                               
proposal to  extend the line  to Fort  Greely, as well  as ARRC's                                                               
support  for moving  frontiers.   Describing transportation  as a                                                               
common  denominator   for  economic  development,  he   said  the                                                               
operative  word in  Alaska is  access,  which converts  potential                                                               
[into  reality].   When  access  is  provided,  as shown  by  the                                                               
history of the  railroad in the U.S., people  who are adventurous                                                               
and  entrepreneurial  will  take  advantage of  what  has  become                                                               
available.   He  surmised that  this  new project  to extend  the                                                               
frontier would be no different.                                                                                                 
11:40 a.m.                                                                                                                      
MR. GAMBELL pointed  out that, significantly, this  first step to                                                               
Fort  Greely,  about  70 miles,  represents  about  a  15-percent                                                               
growth overall  in ARRC.   He related  the assumption that  for a                                                               
capital  project,   some  federal  funding  would   be  the  most                                                               
important part.   He described ARRC as  a "state instrumentality"                                                               
and  a  private corporation  that  doesn't  take money  from  the                                                               
general fund.                                                                                                                   
MR. GAMBELL informed members that  federal funds are available to                                                               
passenger-carrying  railroads  nationwide.    If  there  will  be                                                               
regularly   scheduled  passenger   service  over   the  line,   a                                                               
significant federal source is "formula  funding"; if not, the job                                                               
is a little tougher, although not  impossible:  money may have to                                                               
come directly through the  Federal Railroad Administration (FRA),                                                               
could come through a direct  appropriation in a particular year's                                                               
budget, or  possibly could be  obtained through  "federal highway                                                               
dollars."   The funding  source will be  an important  issue that                                                               
will require discussion and planning.   Federal funds, as opposed                                                               
to  private funds,  require going  through sequential  "hoops and                                                               
hurdles," he noted.  However,  those funds are available and will                                                               
certainly be considered.                                                                                                        
11:42 a.m.                                                                                                                      
MR.  GAMBELL reported  that ARRC  has on  its books  an alternate                                                               
route around Fairbanks.   Perhaps a $100-million  project, it was                                                               
split into two phases about two  years ago.  The first phase, the                                                               
northern  piece,  goes  from  Fort   Wainwright  to  North  Pole.                                                               
Therefore,  [ARRC] has  done some  work on  the initial  phase of                                                               
this 70-mile  route to Fort  Greely, although not knowing  at the                                                               
time  that Fort  Greely  was  an objective.    "We think  there's                                                               
opportunity here," he remarked.                                                                                                 
MR. GAMBELL noted  that annually ARRC sits down  with [DOT&PF] to                                                               
compare  projects  up and  down  the  Railbelt;  this is  to  see                                                               
whether the  two can leverage  their money and take  advantage of                                                               
scale.  If  the route [in HCR  2] is for DOD  [U.S. Department of                                                               
Defense]  purposes,  he noted,  DOD  money  may be  an  important                                                               
component to  consider, along with  whether there  are advantages                                                               
of scale or synergy "with what  would be supported to the DOD and                                                               
necessary for this rerouting, as  well as the splitting of grades                                                               
at important crossings along the  way where the highway goes, for                                                               
safety purposes  and so on."   The opportunity is to  involve DOD                                                               
planning and DOD dollars as a result.                                                                                           
MR. GAMBELL  informed the committee  that [ARRC] has  spent about                                                               
$350,000  studying  this  portion   of  the  route,  including  a                                                               
"concept study" completed in March,  and could address it in more                                                               
detail; however,  it has done  no work  beyond North Pole  on the                                                               
way to  [Fort] Greely.   He offered ARRC's experience  that there                                                               
will be a lot of support in that area.                                                                                          
MR.  GAMBELL noted  that  there also  is  a Fairbanks-North  Star                                                               
Borough rail  taskforce, chaired by  Bonnie Williams (ph);  it is                                                               
taking a  100-year look at what  the railroad should be  doing in                                                               
that part of the Interior.   A railroad strategic planner sits on                                                               
a  committee  of that  taskforce,  and  there have  been  several                                                               
meetings  on the  idea of  extending the  railroad to  the border                                                               
[and] down to Fort Greely.   Acknowledging that the taskforce has                                                               
probably taken  more of a  long-term look beyond North  Pole than                                                               
the railroad itself  has, he suggested that members  of the House                                                               
Special Committee  on Military and  Veterans' Affairs  might want                                                               
to  hear from  a member  of that  progressive group  to see  what                                                               
they've  come up  with.   He  surmised that  the taskforce  would                                                               
support this [extension of the line to Fort Greely].                                                                            
MR.  GAMBELL also  offered his  understanding that  some work  is                                                               
underway  inside the  University of  Alaska Fairbanks  (UAF), not                                                               
from  a railroad  perspective but  from the  perspective of  what                                                               
kind  of transportation  would  most benefit  the  opening up  of                                                               
Interior  Alaska.    Principally,   the  look  is  at  resources,                                                               
including "heavy  lift," longer  distances, markets that  need to                                                               
be served,  conditions over which transportation  must be routed,                                                               
and   year-round  conditions   that  must   be  contended   with.                                                               
Logically, he said, a secondary  benefit would be the ability for                                                               
tourists to come in and so forth.                                                                                               
MR.  GAMBELL said  [UAF]  is looking  for some  funds  and has  a                                                               
commercial partner, but  reiterated that he doesn't  know how far                                                               
they've gone.   He offered his belief that [UAF]  is capable of a                                                               
further study of  the impacts; it could include  the viability of                                                               
a line to  the Canadian border, which "would take  us back to the                                                               
Tanana River  valley and  down to Fort  Greely."   Surmising that                                                               
[UAF's]  work might  be  of interest  to  the current  committee,                                                               
depending on how  far it has progressed, he  suggested that staff                                                               
inquire about  it.   Mr. Gambell pointed  out that  the foregoing                                                               
are other players in the arena that  he is aware of who have done                                                               
some work.                                                                                                                      
11:48 a.m.                                                                                                                      
MR. GAMBELL spoke  in support of moving the  line forward, noting                                                               
that the  railroad is  built on  a model with  17 years  of solid                                                               
success.  It  hasn't had to come back to  the state for operating                                                               
funds.   It must generate  its own  operating funds from  the net                                                               
earnings, since the federal government  doesn't pay for operating                                                               
and maintenance.                                                                                                                
MR. GAMBELL  offered some history.   After the  federal transfer,                                                               
when  the  state  wrote  the  laws  governing  the  railroad,  he                                                               
explained, [ARRC]  built a  model such that  if one  component is                                                               
removed, it  breaks down.   As with the transcontinental  line in                                                               
the Lower  48, one of the  most important pieces was  land, which                                                               
was conveyed with  the intent of its becoming fee  simple once it                                                               
was entirely surveyed and turned  over; the surveying hasn't been                                                               
completed  yet,  although  the  intention is  there.    The  land                                                               
component is important for generating  revenue.  In the Lower 48,                                                               
it allowed  success for the transcontinental  railroad, which was                                                               
given as  much as 6,000  acres per mile  of railroad in  order to                                                               
generate revenue and  thereby fund itself.  He  said that formula                                                               
has allowed the Alaska Railroad  to be successful; it contributed                                                               
significantly to  [ARRC's] net earnings  of about $11  million in                                                               
2002.    That  money  goes   towards  operating  and  maintenance                                                               
expense, which, according to his  rule of thumb, is about $33,000                                                               
a mile per year.                                                                                                                
MR.  GAMBELL pointed  out  that if  15 percent  is  added to  the                                                               
length  of  the  railroad,  maintenance costs  will  increase  15                                                               
percent.  Once [an extension]  is built, therefore, he is looking                                                               
for a  guarantee of some  significant revenue coming  across that                                                               
line that would  go to ARRC and help in  maintaining the line and                                                               
the  standards that  can be  expected.   Referring to  an earlier                                                               
question about  the heavy weight  [of mine ore, for  example], he                                                               
told members:                                                                                                                   
     That's what  we build our  standards to.  We  build our                                                                    
     bridges to it.   We build our rail to it.   And we want                                                                    
     to be  able to  haul the heaviest  load, which  is, ...                                                                    
     for  the Alaska  Railroad,  about  a 10,000-ton  train,                                                                    
     which  is far  more weight  than probably  any military                                                                    
     train that  would be  going to Fort  Greely.   We would                                                                    
     build to the worst case,  or the best case, however you                                                                    
     want  to   look  at  it,   which  would  be   a  pretty                                                                    
     substantial  line ...,  that  were  mining to  develop,                                                                    
     were the line to be  extended to Canada, were the heavy                                                                    
     ores  to  be transferred  in  long  trains -  which  is                                                                    
     really what railroads  do best - this line  would be no                                                                    
     different than any  other piece of our line.   It would                                                                    
     be substantive.  And it  would be capacity- and weight-                                                                    
     capable  and weight-bearing-capable,  to  get the  most                                                                    
     out of it ....                                                                                                             
11:50 a.m.                                                                                                                      
MR.  GAMBELL turned  attention  to  another important  component,                                                               
indemnification.  One  consequence of building more  rail is that                                                               
development occurs along  the corridor.  The  result is immediate                                                               
pressure, as  soon as there is  development in a small  town, "to                                                               
want to  cross the track and  join the two pieces."   He reported                                                               
that "at-grade crossings" are the  primary killer in the Lower 48                                                               
with  regard to  railroads; he  mentioned stories  of people  who                                                               
want  to beat  a train  at a  crossing, for  example.   Hence the                                                               
railroad  has  been indemnified  through  a  "very, very  healthy                                                               
indemnification" by  the state,  realizing that there  were going                                                               
to be many crossings on the  rail line that wouldn't be put there                                                               
because the  railroad wanted them.   The railroad  is indemnified                                                               
against multimillion-dollar  lawsuits such  as those seen  in the                                                               
Lower 48.  He explained the theory behind state indemnification:                                                                
     Even though  many times the  experience has  shown that                                                                    
     it's  the  fault  of  the person  trying  to  make  the                                                                    
     crossings, the  railroad is still  sued.  The  suits go                                                                    
     to court.  They're very  expensive.  And many times the                                                                    
     jury, if it's  sympathetic, is ... going  to find fault                                                                    
     with the railroad  in some way.  And I  think the state                                                                    
     realized  that [for]  a small  railroad  like this,  it                                                                    
     wouldn't take but two or  three of something like that,                                                                    
     and  it could  break the  railroad's back.   And  so we                                                                    
     have a  very healthy  indemnification.  And  the theory                                                                    
     is, we didn't ask for  those roads, we didn't put those                                                                    
     roads there, but if somebody  needs a road and wants to                                                                    
     come in  - if they  take responsibility for it  - we'll                                                                    
     allow them to cross there.                                                                                                 
MR.  GAMBELL  reiterated support  [for  extending  the line]  and                                                               
     We can  do it.   We'll be  delighted to  participate in                                                                    
     the  process, whatever  you determine  that process  to                                                                    
     be.  We do have some  equities ... in that process that                                                                    
     we think would  make it more successful.   There's more                                                                    
     than one  way to  skin a  cat, but  for 17  years we've                                                                    
     skinned  it one  way; it's  been pretty  good.   And we                                                                    
     would hope  that you  would consider  that in  ... your                                                                    
     considerations, as  well as others who  might take this                                                                    
     subject up.                                                                                                                
11:55 a.m.                                                                                                                      
REPRESENTATIVE FATE  asked if Mr.  Gambell has looked  at whether                                                               
and  how  the rest  of  the  line  might  have to  subsidize  the                                                               
additional 15 percent  [proposed to Fort Greely]  because of lack                                                               
of passengers  or the "periodic  shipping," depending on  how big                                                               
Pogo or any other mine is.                                                                                                      
MR.  GAMBELL  replied  that,  as   a  practical  matter,  in  the                                                               
beginning it  would not.   The  good news,  however, is  that the                                                               
line would  be brand new.   That $33,000 [a mile]  is an average;                                                               
with a  brand-new line,  for two or  three years  the maintenance                                                               
would be  rather routine,  and [the costs]  wouldn't be  as high.                                                               
It would  give [ARRC] some  time to develop the  revenue picture.                                                               
He said that  is probably what the railroad would  be counting on                                                               
to  have happen.    "But we  would have  to  subsidize that  line                                                               
through the rest of the  railroad for some additional period," he                                                               
added.  "I don't see any way around it at the present time."                                                                    
REPRESENTATIVE  FATE  asked  whether  Mr.  Gambell  foresees  any                                                               
permitting  or  land-acquisition  problems  with the  bill.    He                                                               
offered his  understanding that  most of it  would be  federal or                                                               
state land, but  that there might be some private  land that [the                                                               
railroad] would have to go over.                                                                                                
MR. GAMBELL answered:                                                                                                           
     We have not  really gone out to the  degree that you're                                                                    
     asking  and  tried to  look  into  what those  problems                                                                    
     might be.  As a general  rule, anytime you've got to go                                                                    
     out and  get permitting, there's always  problems.  But                                                                    
     it's a way of life; you've just got to get through it.                                                                     
TAPE 03-1, SIDE B                                                                                                             
11:58 a.m.                                                                                                                      
MR. GAMBELL  mentioned the ability  to request eminent  domain, a                                                               
time-consuming legal  process that has  its own steps.   First of                                                               
all  in  the process,  he  said,  the EIS  [environmental  impact                                                               
statement]  is  very important:    it  takes  the first  look  at                                                               
alternatives and  some of these  issues.   Second, if there  is a                                                               
successful EIS  and a  decision is  made to  go forward,  part of                                                               
that decision  is based on not  only the geography, but  also the                                                               
permitting.  He explained:                                                                                                      
     The  permitting  is  going  to be  in  the  micro;  the                                                                    
     geography's going to be more in  the macro.  But it may                                                                    
     require  that you  sidestep or  go around  or ...  take                                                                    
     some unusual  actions.  We  would hope that  that would                                                                    
     be minimized,  because from  a transportation  point of                                                                    
     view ... you want the most  direct line from A to B, to                                                                    
     keep  your  velocity  up  and to  keep  the  goods  and                                                                    
     services moving.  ... That's  where you not  only [get]                                                                    
     efficiency, but you make (indisc.) too.                                                                                    
REPRESENTATIVE  CISSNA  asked  what  kinds  of  hoops  exist  for                                                               
federal money.  Saying she is  a fan of the railroad, she pointed                                                               
out  that   rail  line  is   semi-permanent  and   requires  much                                                               
forethought; it has  huge implications for the part  of the state                                                               
[where  it  goes].    She  said   it  sounds  as  though  it  has                                                               
implications for the  success of the whole line if  it isn't done                                                               
prudently and with forethought.                                                                                                 
MR. GAMBELL agreed.                                                                                                             
REPRESENTATIVE CISSNA  inquired about possible  financial effects                                                               
on ARRC.   She mentioned Alaskan hire as an  example of something                                                               
desirable,  but  emphasized the  desire  to  avoid weakening  the                                                               
railroad.   She asked  what the legislature  should be  adding to                                                               
this resolution to make sure it is done right.                                                                                  
MR. GAMBELL  offered his opinion  that most likely this  would be                                                               
contentious,  that   the  clock   would  tick  fast   during  the                                                               
legislative session, and that there  would be debate over whether                                                               
to study it more or take steps.   A likely compromise would be an                                                               
agreement to study  it, which would be a "win"  for everybody and                                                               
would  buy time.    A route  most  likely won't  be  part of  the                                                               
debate.   Citing several studies  - beginning in the 1940s during                                                               
[World War II] and including some  studies in the 1970s and 1980s                                                               
- he  said the  geography isn't that  difficult, and  pretty much                                                               
dictates which  way the line  will run:  "If  you want to  get to                                                               
civilization on  the other side,  you've pretty much got  to head                                                               
down with the route that we've  already seen, past Greely down to                                                               
the border,  which is about a  270-mile route, and then  it's 600                                                               
miles  to join  up  with  the ...  railroad  that's  going up  to                                                               
Whitehorse, and that's  the road down through Canada  and down to                                                               
the Lower 48."                                                                                                                  
MR. GAMBELL  acknowledged, however, that the  governor and others                                                               
are  talking  seriously about  moving  forward;  that this  first                                                               
section  to [Fort]  Greely isn't  rocket science;  and that  once                                                               
there is momentum and what it  takes is determined, the next step                                                               
will be easier.   "Not a bad philosophy,  actually," he remarked.                                                               
Pointing out  the necessity  of an [EIS],  he suggested  that one                                                               
step, if legislators  want to act, is to  put "reasonable dollars                                                               
down" to take the first step  towards doing the EIS.  He reported                                                               
that for an EIS on a project  this size, the railroad uses a rule                                                               
of thumb  of 10 percent  of the  capital costs, which  has worked                                                               
pretty well for projects in  the "double-digit millions"; he said                                                               
he didn't know  how it would apply to a  project costing billions                                                               
of  dollars.    He  estimated that  for  a  $40-million  project,                                                               
therefore, a full EIS would cost  about $4 million and take about                                                               
two years.                                                                                                                      
MR.  GAMBELL also  reported that  for  a big  project like  this,                                                               
[ARRC  estimates] $3  million to  $8 million  a mile  [in capital                                                               
costs], with an  average of perhaps $5 million  a mile, depending                                                               
on terrain, the  number of bridges, and so forth.   At $5 million                                                               
a mile,  capital costs  would be $350  million to  [Fort] Greely.                                                               
After the  engineering survey is  done, he pointed out,  the cost                                                               
would be nailed  down; the foregoing is estimated on  the rule of                                                               
thumb, and the  cost of the EIS could be  estimated at 10 percent                                                               
of that.                                                                                                                        
MR. GAMBELL,  because of  the costs, suggested  the need  for the                                                               
legislature  to  debate whether  to  do  [the  EIS] on  just  the                                                               
section  to Fort  Greely or  clear to  the [Canadian]  border, so                                                               
that it  would be done already  when there is a  desire to extend                                                               
the  next  phase as  markets  develop  and  so  forth.   He  said                                                               
permitting would  be part of  that.  Returning  to Representative                                                               
Cissna's question, he said:                                                                                                     
     I think that the movements  that you're looking for are                                                                    
     probably  going to  be in  the environmental  area, and                                                                    
     then,  if you're  going to  study something,  study the                                                                    
     permitting that's going to be  required - at the detail                                                                    
     level, for  example, with private landowners  and those                                                                    
     agencies, whether it's state,  whether it's federal, or                                                                    
     whether it's tribal.  Find out  who ... owns what.  And                                                                    
     that's all  been mapped  out, but  take the  next level                                                                    
     down and  say, ... "What  do you think about  running a                                                                    
     railroad through here?   What are you going  to tell us                                                                    
     ... when  we really sit  down and start talking  to you                                                                    
     about it?"   And maybe  start to develop that  dialog a                                                                    
     little bit.                                                                                                                
12:04 p.m.                                                                                                                      
REPRESENTATIVE  CISSNA asked  how  HCR 2  could  be worded  best,                                                               
then, to  set the stage  to start this  off in the  best possible                                                               
way.   She said she was  thinking more about what  other uses are                                                               
potentially affected,  as well as  what social factors  there are                                                               
to think about.  She asked  whether those usually are in an [EIS]                                                               
as well.                                                                                                                        
MR.  GAMBELL   answered  that  an  [EIS]   "mandates  alternative                                                               
routes,"  and  its  purpose  is to  look  at  impacts,  including                                                               
impacts  on wildlife.    He indicated  it depends  on  how it  is                                                               
written  and remarked,  "A  lot of  what  you're concerned  about                                                               
would  be in  the  environmental impact  statement and  studied."                                                               
For what  isn't included,  he suggested  possibly looking  to the                                                               
University of  Alaska, for example,  which may have  already done                                                               
some work to look at those types of issues.                                                                                     
REPRESENTATIVE CISSNA agreed  there is no reason  to reinvent the                                                               
wheel if studies already have been  done.  She said she'd like to                                                               
think about it awhile and  then request [Mr. Gambell's] expertise                                                               
when the committee fine-tunes it.                                                                                               
12:09 p.m.                                                                                                                      
[There was  overlapping discussion of where  this extension would                                                               
be on a map, following a request by Representative Weyhrauch.]                                                                  
REPRESENTATIVE GRUENBERG  inquired about using  "requests" rather                                                               
than "direct"  on page 2,  line 13.   He expressed  concern about                                                               
the relationship between  the State of Alaska and  ARRC, since it                                                               
is an independent corporation.                                                                                                  
MR. GAMBELL  responded that the  use of "direct"  is appropriate.                                                               
He  explained, "We  work for  the governor  through the  board of                                                               
directors of the railroad, and  the governor can direct the board                                                               
of directors."                                                                                                                  
12:11 p.m.                                                                                                                      
REPRESENTATIVE  WEYHRAUCH  explained  that  he'd  been  concerned                                                               
whether this proposed  extension is for a branch  line instead of                                                               
the main line.                                                                                                                  
MR. GAMBELL said it is the main  line.  He added, "It will become                                                               
...  a new  main line,  depending  on what  else you  did to  the                                                               
railroad.   But since it's  a single, yes,  it would be  the main                                                               
line, unless you  went up northwest, ... in which  case it's sort                                                               
of a new ..."                                                                                                                   
REPRESENTATIVE WEYHRAUCH  interjected.   He referred to  the last                                                               
"WHEREAS" clause [page  2, line 9], and suggested  this would get                                                               
the railroad closer to Canada.                                                                                                  
MR.  GAMBELL  indicated it  is  along  the  same route  that  was                                                               
surveyed to go to Canada.                                                                                                       
REPRESENTATIVE WEYHRAUCH asked where  this extension falls in the                                                               
railroad's priority list.                                                                                                       
MR. GAMBELL replied that it isn't [on the priority list].                                                                       
REPRESENTATIVE WEYHRAUCH asked who  wanted this resolution, then.                                                               
He specifically asked whether the railroad wanted it.                                                                           
MR. GAMBELL said no.                                                                                                            
REPRESENTATIVE WEYHRAUCH asked whether this  would be billed as a                                                               
passenger line to the federal government.                                                                                       
MR. GAMBELL said no.                                                                                                            
REPRESENTATIVE  WEYHRAUCH  suggested  the  railroad  wouldn't  be                                                               
getting federal funds in the passenger formula, then.                                                                           
MR.  GAMBELL answered,  "Not until  such time  as we  would start                                                               
regularly scheduled, year-round passenger service."                                                                             
REPRESENTATIVE WEYHRAUCH  highlighted the  zero fiscal note.   He                                                               
surmised  that any  [funding] would  be from  either the  federal                                                               
government or railroad revenues.                                                                                                
MR. GAMBELL replied, "We assumed that  the state was not going to                                                               
fund  this  railroad.    Now,  ...  that's  a  very  short-notice                                                               
assumption; just  last night,  really, is the  first time  we got                                                               
the question about the fiscal  note."  Adding that the assumption                                                               
might not  be accurate, he said  it is up to  the legislature and                                                               
the  governor.     In  response   to  a  further   question  from                                                               
Representative  Weyhrauch regarding  whether  the military  wants                                                               
this line, he said [ARRC]  hadn't been contacted by the military.                                                               
As  to whether  building the  line will  upset any  truck traffic                                                               
that currently delivers supplies to  Fort Greely, he indicated he                                                               
didn't know.                                                                                                                    
12:14 p.m.                                                                                                                      
REPRESENTATIVE  GRUENBERG  related   his  understanding  that  it                                                               
wasn't  certain  until  the  results  of  the  last  presidential                                                               
election were known that the U.S.  would deploy a large number of                                                               
missile-defense [systems] like  that at Fort Greely,  and that in                                                               
some  ways the  decision was  as much  political as  military and                                                               
MR. GAMBELL said he thought that was a fair statement.                                                                          
REPRESENTATIVE  GRUENBERG asked:   If  that is  the case,  and if                                                               
there is a change in  the political climate in Washington [D.C.],                                                               
might the Fort  Greely site no longer be operative  at some point                                                               
in  the  future, perhaps  even  before  the rail  [extension]  is                                                               
MR. GAMBELL replied  that it isn't really  a "railroad question,"                                                               
but observed  that because the  deployment itself is  phased over                                                               
several years, there will continue to be debate about it.                                                                       
REPRESENTATIVE GRUENBERG asked whether it  is necessary to have a                                                               
railroad in order to get missiles  onto the site, or whether they                                                               
can be trucked.                                                                                                                 
MR. GAMBELL answered that they'll be delivered by air.                                                                          
REPRESENTATIVE GRUENBERG  asked whether  facilities at  that site                                                               
could  allow  an aircraft  of  that  size  to land,  and  whether                                                               
missiles can be  maintained without a railroad, either  by air or                                                               
by road.                                                                                                                        
MR. GAMBELL replied:                                                                                                            
     Again, my expertise on the  maintenance of the missiles                                                                    
     is almost nonexistent,  but I can tell you  that ... if                                                                    
     they're going  to be  maintained by  air, the  state of                                                                    
     the art  ... in  weaponry these  days is,  they're more                                                                    
     and more self-contained.   They're ... encapsulated, in                                                                    
     other  words.     In  ...  a  lot   of  cases,  they're                                                                    
     environmentally  controlled.    Their  diagnostics  are                                                                    
     internal to each weapon; you plug  it in and read it on                                                                    
     a computer.                                                                                                                
     It's not  like building a  hole in the ground  in Grand                                                                    
     Forks, North Dakota, like it  was before, where you had                                                                    
     to have a  blockhouse and a lot of  computers and those                                                                    
     kinds of things.   The ability to move  the missiles is                                                                    
     much  easier; they're  much smaller;  they weigh  less.                                                                    
     And my understanding at this  point is that that's what                                                                    
     allows air  to lift them in  and out.  As  you've said,                                                                    
     if you've got the right-size  runway and all the arctic                                                                    
     hardware ...                                                                                                               
12:17 p.m.                                                                                                                      
REPRESENTATIVE GRUENBERG asked why a railroad is necessary.                                                                     
MR.  GAMBELL  answered  that  he was  simply  responding  to  the                                                               
question  of  whether [ARRC]  would  be  able to  construct  this                                                               
railroad satisfactorily.  He suggested  the need to have a dialog                                                               
with the military  in order to determine why  the military hadn't                                                               
contacted [ARRC] regarding maintenance or logistics support.                                                                    
REPRESENTATIVE GRUENBERG,  noting that he  is a cosponsor  of the                                                               
resolution,  agreed it  is  worthy  of discussion.    He said  he                                                               
didn't  want  to see  [the  state]  do something  unnecessary  or                                                               
expensive that would waste time or money.                                                                                       
12:18 p.m.                                                                                                                      
REPRESENTATIVE  FATE, with  regard  to  the military  importance,                                                               
said he was  privy to some discussion with  "the senior officers"                                                               
who were  doing the strategic  planning for the military  for the                                                               
site.    He agreed  with  [Mr.  Gambell]  but added,  "They  did,                                                               
however, say,  that if there  was a  railroad to that  site, even                                                               
though  the  railroad  ...  was not  necessary  for  the  project                                                               
itself, they  would certainly use  that for infrastructure."   He                                                               
cited  as examples  concrete, supplies,  and logistical  support.                                                               
Noting   that   [then-Representative]    Jeannette   James   [had                                                               
introduced  legislation  regarding  extending the  railroad]  for                                                               
years, and  that the  congressional delegation  has "been  on the                                                               
subject" as well, Representative Fate  said this expansion of the                                                               
transportation  system is  sorely needed  throughout Alaska.   He                                                               
expanded on his remarks:                                                                                                        
     There are huge  deposits of minerals in  that area that                                                                    
     we need to  ... not only develop but to  ship, and make                                                                    
     it   ...    economic   for   that   to    take   place.                                                                    
     Transportation   is  the   one,  sole   thing  in   the                                                                    
     development  in the  state of  Alaska that  is lacking.                                                                    
     And if  we're going to  develop this state, we  have to                                                                    
     have  transportation.    It  just  so  happens  that  a                                                                    
     railroad  is usually  much cheaper  transportation than                                                                    
     any  other mode  of transportation,  unless it's  water                                                                    
REPRESENTATIVE FATE  suggested moving on  and taking a  hard look                                                               
at what the  resolution does.  He  noted that if there  is a bill                                                               
to fund the right-of-way or  provide matching funds, for example,                                                               
it  will  be well  debated  before  the permitting  process  even                                                               
begins on this huge project.                                                                                                    
12:21 p.m.                                                                                                                      
CHAIR  LYNN thanked  Mr. Gambell  and asked  whether anyone  else                                                               
wished to testify; there was no response.                                                                                       
REPRESENTATIVE  CISSNA requested  to hear  from a  member of  the                                                               
military with regard to support for this.                                                                                       
CHAIR LYNN  responded that the committee  could certainly contact                                                               
the military for input, but that  at this point he didn't see the                                                               
need to delay  anything for the military to comment.   He said it                                                               
is simply a resolution.                                                                                                         
REPRESENTATIVE  CISSNA   expressed  concern  on  behalf   of  her                                                               
constituents  about   not  wasting  money   through  governmental                                                               
spending  of  huge  amounts  of  money around  the  state.    She                                                               
suggested the need  for vigilance, even if this  is a resolution.                                                               
She again asked to hear from the military.                                                                                      
12:24 p.m.                                                                                                                      
REPRESENTATIVE  GRUENBERG suggested,  in  view  of Mr.  Gambell's                                                               
comments and  that this  is the first  week of  [hearings during]                                                               
the session,  that no damage  would be done by  getting testimony                                                               
[before moving the resolution forward].   He pointed out that the                                                               
House Special Committee on Military  and Veterans' Affairs is the                                                               
only committee of  referral for this legislation,  after which it                                                               
goes to the House floor.                                                                                                        
CHAIR LYNN called an  at-ease at 12:25 p.m.  [Side  B of the tape                                                               
ends early; no testimony is missing.]                                                                                           
TAPE 03-2, SIDE A                                                                                                             
CHAIR LYNN called the meeting back to order at 12:33 p.m.                                                                       
REPRESENTATIVE GRUENBERG informed members  that he'd checked with                                                               
[legislative] legal  counsel and that a  concurrent resolution is                                                               
the right format for this.                                                                                                      
12:34 p.m.                                                                                                                      
REPRESENTATIVE  CISSNA [moved  to adopt]  "informal" Amendment  3                                                               
[later clarified  off the record  to be a  conceptual amendment],                                                               
as follows:                                                                                                                     
     Page 2, line 13:                                                                                                           
          Delete the second "the"                                                                                               
          Insert "a feasibility study including ... the                                                                         
     required ...  environmental impact statement,  plus any                                                                    
     additional  studies  that  have been  completed  on  an                                                                    
     extension of the Alaska Railroad to Fort Greely"                                                                           
REPRESENTATIVE CISSNA said  the foregoing would take  care of any                                                               
objections she had.                                                                                                             
REPRESENTATIVE FATE  objected.  He  said the  EIS is part  of the                                                               
process of  permitting, and  there are  many hurdles  before even                                                               
beginning a  project.  "Any fear  that you're going to  upset ...                                                               
an environmental balance,  you really don't have  to worry about,                                                               
because that will take place even before the project," he added.                                                                
REPRESENTATIVE  CISSNA indicated  that  although  she'd used  the                                                               
term  "environmental  impact  statement," she  was  referring  to                                                               
testimony that the  EIS covers a great many things.   She offered                                                               
her own  concern that "we  really know what we're  spending," and                                                               
that [the extension of the  rail line] is being suggested without                                                               
following the due course that's required.                                                                                       
REPRESENTATIVE FATE  said the  EIS covers  "basically everything"                                                               
and  that the  coastal  zone management  [requirements] may  even                                                               
cover the  Interior.   He mentioned water  quality and  said that                                                               
any  project of  this size  will be  scrutinized thoroughly  with                                                               
regard to the environmental aspects.                                                                                            
REPRESENTATIVE CISSNA  expressed concern that the  state has made                                                               
mistakes in  the past,  that not all  projects have  been viable,                                                               
and that  the state cannot afford  to make more mistakes  at this                                                               
crucial time in Alaska's history.                                                                                               
REPRESENTATIVE  FATE said  this resolution  is more  than helping                                                               
the  military.   It has  to do  with the  development of  Alaska,                                                               
including  resource  development.   He  offered  his belief  that                                                               
those  developments are  "secure" because  the state  and federal                                                               
governments have  existing law "that  scrutinizes the  effects of                                                               
this project  on any environment."   He  added, "And so,  I don't                                                               
have the  problems with  the environment  that some  people have,                                                               
because of  the law of  the land - both  federal and the  state -                                                               
that  cover  these areas  so  well.   But  we  must  get on  with                                                               
projects to help develop the state  of Alaska."  He again offered                                                               
his belief  that the regulations  and laws exist to  make certain                                                               
that development occurs properly.                                                                                               
12:40 p.m.                                                                                                                      
REPRESENTATIVE  GRUENBERG  suggested  that  the  record  of  this                                                               
committee will go along with  the resolution to the President and                                                               
the  congressional delegation.    However, the  committee has  no                                                               
evidence that  the military  needs this  railroad for  the [anti-                                                               
ballistic] missiles,  which Mr. Gambell  has said come in  by air                                                               
and don't even require a road.   If the state is going to ask the                                                               
federal government to provide the  millions of dollars for this -                                                               
and  for perhaps  developing that  part of  the state,  which may                                                               
require a  heavy-duty rail  bed and  additional rolling  stock or                                                               
locomotives, for example - there needs  to be a strong record [in                                                               
support of HCR  2].  Pointing out that this  committee deals with                                                               
the  military aspect,  not  the  resource-development aspect,  he                                                               
urged the chair  to take one more week in  order to get testimony                                                               
from the military,  in order to have evidence in  the record from                                                               
that perspective.   Otherwise, the resolution might  not be doing                                                               
the project any good.                                                                                                           
CHAIR LYNN  conveyed his preference  for taking action.   He said                                                               
he would be contacting the military for comments.                                                                               
The committee took an at-ease from 12:45 p.m. to 12:49 p.m.                                                                     
REPRESENTATIVE   CISSNA  asked   about   adding  to   [Conceptual                                                               
Amendment  3]  a  request  that  railroad  officials  respond  to                                                               
whether  the amendment  would be  helpful to  [ARRC] in  terms of                                                               
making sure that this is financially viable for the railroad.                                                                   
REPRESENTATIVE FATE, as a point  of order, questioned the concept                                                               
of  asking  a   question  in  a  resolution  in   order  to  gain                                                               
information.   He suggested dealing  with Conceptual  Amendment 3                                                               
without this new amendment to it.                                                                                               
CHAIR LYNN concurred.                                                                                                           
A  roll  call  vote  was   taken.    Representatives  Cissna  and                                                               
Gruenberg   voted   in   favor   of   Conceptual   Amendment   3.                                                               
Representatives  Dahlstrom,  Fate,  and Lynn  voted  against  it.                                                               
Representatives  Masek and  Weyhrauch were  absent for  the vote.                                                               
Therefore, Conceptual Amendment 3 failed by a vote of 2-3.                                                                      
REPRESENTATIVE FATE  moved to  report HCR 2  [as amended]  out of                                                               
committee [with  individual recommendations and  the accompanying                                                               
zero fiscal note].                                                                                                              
REPRESENTATIVE GRUENBERG moved to  table the resolution until the                                                               
next  meeting.   He  offered  his  understanding that  the  chair                                                               
wanted to get the views of the military.                                                                                        
CHAIR  LYNN clarified  that he  would talk  to the  military, but                                                               
that it wouldn't [affect what was done this current day].                                                                       
REPRESENTATIVE GRUENBERG withdrew his motion.                                                                                   
A roll  call vote  was taken.   Representatives  Dahlstrom, Fate,                                                               
and Lynn voted  in favor of [reporting HCR 2,  as amended, out of                                                               
committee].   Representatives Cissna and Gruenberg  voted against                                                               
it.   Representatives  Masek and  Weyhrauch were  absent for  the                                                               
vote.    Therefore  [because  a   majority  of  the  seven-member                                                               
committee  didn't vote  to move  the resolution  from committee],                                                               
CSHCR  2(MLV)  failed  to  be reported  from  the  House  Special                                                               
Committee on Military and Veterans' Affairs by a vote of 3-2.                                                                   
There being no  further business before the  committee, the House                                                               
Special Committee  on Military and Veterans'  Affairs meeting was                                                               
adjourned at 12:58 p.m.                                                                                                         

Document Name Date/Time Subjects