02/10/2026 08:00 AM House COMMUNITY & REGIONAL AFFAIRS

          HB 216-TRANSFER OF RAILROAD LAND TO WHITTIER                                                                      
                                                                                                                                
8:11:43 AM                                                                                                                    
                                                                                                                                
CO-CHAIR MEARS announced  that the final order  of business would                                                               
be, "An  Act approving the transfer  of land owned by  the Alaska                                                               
Railroad Corporation to  the City of Whittier;  and providing for                                                               
an effective date."                                                                                                             
                                                                                                                                
8:12:09 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE HOLLAND, as  prime sponsor, presented HB  216.  He                                                               
paraphrased  the sponsor  statement  [included  in the  committee                                                               
file], which read as follows [original punctuation provided]:                                                                   
                                                                                                                                
     HB 216  provides the  limited and  specific legislative                                                                    
     authorization  required  under  AS  42.40.285  for  the                                                                    
     Alaska Railroad  Corporation to convey  five identified                                                                    
     parcels of  railroad land within  the City  of Whittier                                                                    
     to the City, subject to  fair market value and existing                                                                    
     rights.                                                                                                                    
                                                                                                                                
     In November of  2025, the City Council  voted to accept                                                                    
     the Railroad's proposal to sell  three parcels of land,                                                                    
     with  the  option  to   later  acquire  two  additional                                                                    
     parcels. In  December, it  authorized the  city manager                                                                    
     to  negotiate a  final  purchase  agreement. That  same                                                                    
     month, the  Railroad submitted a conditional  letter of                                                                    
     intent conveying  its agreement  with the terms  of the                                                                    
     transfer.                                                                                                                  
                                                                                                                                
     However,  current statute  prohibits the  Railroad from                                                                    
     selling  or otherwise  conveying its  interest in  land                                                                    
     without  express approval  from  the legislature.  This                                                                    
     bill  satisfies that  statutory requirement  and allows                                                                    
     the Railroad and the City  to proceed with a negotiated                                                                    
     transfer  to  be   approved  through  their  respective                                                                    
     governing  processes.   The  parcel   descriptions  are                                                                    
     provided  for  authorization  purposes  and  allow  for                                                                    
     reasonable   modification   to  accommodate   necessary                                                                    
     surveying and platting prior to final conveyance.                                                                          
                                                                                                                                
     HB 216 does not establish  the terms of sale, require a                                                                    
     transfer,  or direct  how  the land  must  be used.  It                                                                    
     simply  removes  the  statutory barrier  to  allow  the                                                                    
     parties to complete a mutually agreedupon                                                                                  
     transaction.                                                                                                               
                                                                                                                                
8:14:18 AM                                                                                                                    
                                                                                                                                
AYDEN  NICHOL, Staff,  Representative  Ky  Holland, Alaska  State                                                               
Legislature, on behalf of  Representative Holland, prime sponsor,                                                               
offered  a PowerPoint  presentation on  HB 216  [included in  the                                                               
committee  file], beginning  on slide  2, "History:  Whittier and                                                               
the   Alaska  Railroad,"   which   read   as  follows   [original                                                               
punctuation provided]:                                                                                                          
                                                                                                                                
     Whittier  (pop.  272)  connects Anchorage  with  Prince                                                                    
     William  Sound  shipping and  ferry  routes,  and is  a                                                                    
     popular cruise destination                                                                                                 
                                                                                                                                
     For most  of its history,  the Alaska Railroad  was the                                                                    
     only land  route connecting Whittier  with the  rest of                                                                    
     the state, via the the Anton Anderson Tunnel                                                                               
                                                                                                                                
     The  Alaska  Railroad  has  long  benefitted  from  its                                                                    
     significant  land  holdings  within  the  city  limits,                                                                    
     which constitute 85% of Whittier's developable land                                                                        
                                                                                                                                
     In 1998, the Railroad agreed  to lease 250 acres to the                                                                    
     City for development                                                                                                       
                                                                                                                                
MR. NICHOLE continued to slide 3, "From a lease to City                                                                         
ownership," which read as follows [original punctuation                                                                         
provided]:                                                                                                                      
                                                                                                                                
     The  status   of  the  land  under   the  City's  lease                                                                    
     discourages  investment  and  prevents  the  City  from                                                                    
     bringing in tax                                                                                                            
                                                                                                                                
     revenue from businesses situated on the property.                                                                          
     Early in  2024, negotiations began for  the transfer of                                                                    
     ownership of five parcels of  land from the Railroad to                                                                    
     the City.                                                                                                                  
                                                                                                                                
     In December  of 2025,  the City Council  authorized the                                                                    
     City Manager  to negotiate a final  agreement for three                                                                    
     parcels,  and  the  Railroad  submitted  a  conditional                                                                    
     letter of intent to proceed with the sale.                                                                                 
                                                                                                                                
     Legislative approval is a  critical element required to                                                                    
     allow  this deal  to proceed:  under AS  42.40.285, the                                                                    
     Railroad is prohibited  from relinquishing land without                                                                    
     the authorization of the legislature.                                                                                      
                                                                                                                                
8:16:06 AM                                                                                                                    
                                                                                                                                
MR.  NICHOLE continued  to slide  4, which  showed a  map of  the                                                               
Alaska  Railroad  Corporation  (ARRC)  Area  of  Interest  (AOI).                                                               
Slides 5-6 offered  a sectional analysis of the  bill, which read                                                               
as follows [original punctuation provided]:                                                                                     
                                                                                                                                
     Section 1                                                                                                                  
     Authorizes the  Railroad to  transfer the  five parcels                                                                    
     to the city for fair market value per AS 42.40.285                                                                         
                                                                                                                                
     Describes the five parcels authorized for transfer                                                                         
                                                                                                                                
       Recognizes that further platting and surveying is                                                                        
         necessary to complete the exchange, subject to                                                                         
     agreement by the parties                                                                                                   
     5                                                                                                                          
      Ensures that this section meets the requirements for                                                                      
       dispensation of land under statutes governing the                                                                        
     Railroad                                                                                                                   
                                                                                                                                
     Section 2                                                                                                                  
     Establishes an immediate effective date                                                                                    
                                                                                                                                
8:18:08 AM                                                                                                                    
                                                                                                                                
CO-CHAIR MEARS  announced that the  committee would  hear invited                                                               
testimony on HB 216.                                                                                                            
                                                                                                                                
8:18:24 AM                                                                                                                    
                                                                                                                                
MEGHAN  CLEMENS, Director  of External  Affairs, Alaska  Railroad                                                               
Corporation (ARRC), gave invited testimony  in support of HB 216.                                                               
She noted  that selling land  is not something that  the railroad                                                               
takes lightly.   The process  requires both  legislative approval                                                               
and  approval by  the  ARRC  Board of  Directors  with the  board                                                               
obligated to  find that  the land is  not necessary  for railroad                                                               
purposes and that  the sale would serve the best  interest of the                                                               
state.   She explained that  ARRC and  the City of  Whittier have                                                               
engaged  in ongoing  discussions  over the  past  two years  that                                                               
culminated in a  proposal at the board's direction  to sell three                                                               
parcels  of land  in the  city's core  downtown district  at fair                                                               
market value,  as required by  statute.  Following  the proposal,                                                               
ARRC received  a conditional letter  of intent from the  city and                                                               
last week, the  board passed a resolution approving  the sales of                                                               
AOI 1, 2, and  3.  She noted that completing  the sale of parcels                                                               
1-3 would not  preclude a potential future sale of  parcels 4 and                                                               
5.   She  added  that  legislative approval  of  this sale  would                                                               
expedite the process in the future.                                                                                             
                                                                                                                                
8:21:12 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  PRAX asked  whether ARRC  has a  plan to  provide                                                               
services in Whittier.                                                                                                           
                                                                                                                                
MS.  CLEMENS reminded  the committee  that to  sell the  land, it                                                               
must  not be  necessary for  railroad purposes.   The  parcels in                                                               
question have been under joint  master agreement with the City of                                                               
Whittier  for a  number of  years and  already been  commercially                                                               
developed  for   non-railroad  purposes   under  a   lease  share                                                               
agreement with the  city.  Given this situation,  parcels 1-3 are                                                               
not deemed  necessary for railroad  operational purposes,  and it                                                               
was  determined  that selling  these  parcels  would be  mutually                                                               
beneficial.                                                                                                                     
                                                                                                                                
REPRESENTATIVE  PRAX asked  whether  an environmental  assessment                                                               
has been conducted, or whether one is needed.                                                                                   
                                                                                                                                
MS. CLEMENS said HB 216 strictly  authorizes the sale of the land                                                               
and   certainly  much   more  is   involved  in   completing  the                                                               
transaction.   The conditional letter  of intent provided  by the                                                               
city outlines the full scope  of the purchase and sale agreement,                                                               
as well as the required due diligence.                                                                                          
                                                                                                                                
REPRESENTATIVE PRAX opined that  the legislature should move this                                                               
bill forward.                                                                                                                   
                                                                                                                                
8:25:19 AM                                                                                                                    
                                                                                                                                
CO-CHAIR  MEARS   asked  whether  there  are   any  contingencies                                                               
associated with the sale.                                                                                                       
                                                                                                                                
MS. CLEMENS answered no, it would  be a complete sale of the land                                                               
to the City of Whittier.                                                                                                        
                                                                                                                                
8:26:12 AM                                                                                                                    
                                                                                                                                
JACKIE  WILDE,  City  Manager, City  of  Whittier,  gave  invited                                                               
testimony in support of HB 216.   She explained that this sale is                                                               
almost 40 years  in the making because in 1998,  the city entered                                                               
into a master lease with ARRC,  which allowed the city to operate                                                               
the land  while paying 40 percent  of gross revenues.   She noted                                                               
the  need  for economic  development  with  the new  cruise  ship                                                               
terminal being  built and the need  for more housing.   She added                                                               
that  the  city owns  very  little  land, including  the  Buckner                                                               
building,  which is  an  abandoned U.S.  military  building on  a                                                               
large, contaminated site, and the "tank  farm" at the head of the                                                               
bay.   She  said the  bill would  be a  large first  step towards                                                               
working together for decades to come.                                                                                           
                                                                                                                                
8:29:57 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE HALL  asked whether there are  particular economic                                                               
development projects that the city hopes to pursue.                                                                             
                                                                                                                                
MS.  WILDE  said the  City  of  Whittier  has already  drafted  a                                                               
waterfront economic development plan and  is looking to develop a                                                               
master transportation  plan with  Department of  Transportation &                                                               
Public Facilities (DOT&PF).  She  reported that Whittier receives                                                               
over  7,000 visitors  per year,  which drives  the need  to build                                                               
additional storefronts, housing, and economic development.                                                                      
                                                                                                                                
REPRESENTATIVE HALL asked about the timeline for these plans.                                                                   
                                                                                                                                
MS. WILDE  said the city  has a 30-year capital  improvement plan                                                               
to use  this land in the  best way possible for  the city, state,                                                               
and railroad.                                                                                                                   
                                                                                                                                
REPRESENTATIVE  HALL asked  about barriers  to these  development                                                               
plans.                                                                                                                          
                                                                                                                                
MS. WILDE  said the  biggest challenge is  that the  city doesn't                                                               
own the  land, which makes it  hard to apply for  federal funding                                                               
for community  block grants.   The master lease, she  said, while                                                               
well  intended  was   not  a  great  idea   and  illustrates  the                                                               
importance  of  terminating  the   lease  and  working  with  the                                                               
railroad on this deal.                                                                                                          
                                                                                                                                
8:33:12 AM                                                                                                                    
                                                                                                                                
CO-CHAIR MEARS announced that the bill would be held over.