03/12/2019 01:30 PM Senate TRANSPORTATION

          SB  54-ALASKA RAILROAD CORP. LAND TRANSFERS                                                                       
                                                                                                                                
1:31:33 PM                                                                                                                    
CHAIR HUGHES announced the consideration of SENATE BILL NO. 54                                                                  
"An  Act  approving  the  transfer  of  certain  Alaska  Railroad                                                               
Corporation land; and providing for an effective date."                                                                         
                                                                                                                                
                                                                                                                                
1:31:54 PM                                                                                                                    
RYNNIEVA  MOSS,   Staff,  Senator  John  Coghill,   Alaska  State                                                               
Legislature,  Juneau,  Alaska,  stated   that  in  2017,  Senator                                                               
Coghill introduced SB  86 that originally would  have allowed the                                                               
Alaska Railroad  Corporation to sell property  without permission                                                               
from the legislature.  That is in statute.  The [Senate] approved                                                               
a  version of  the bill  that had  a pilot  program to  allow the                                                               
railroad  to do  this  for three  years and  then  report to  the                                                               
legislature  on  their  actions  to  see if  they  could  have  a                                                               
permanent exemption from  that approval. SB 86 died  in the House                                                               
Labor and  Commerce Committee, but  the Senate and  House Finance                                                               
Committees  felt it  was important  to put  more land  in private                                                               
ownership  and  allow  economic  development.  They  both  had  a                                                               
committee  substitute  in  the  last days  of  the  session  that                                                               
included  five  specific  land sales  that  the  Alaska  Railroad                                                               
Corporation  Board of  Directors had  approved. Private  entities                                                               
also asked  to be allowed to  negotiate with the railroad  on two                                                               
potential land sales. Those were  a nonprofit housing corporation                                                               
and Lynden Transport.                                                                                                           
                                                                                                                                
MS. MOSS  said in  doing all  of that  the last  two days  of the                                                               
session, she used  the wrong acreage for the  Otto Lake property.                                                               
She was  under the impression  that they  were going to  sell the                                                               
existing lease, but they were  selling the whole plot, which left                                                               
about  18   acres  unaccounted  for   in  the  approval   by  the                                                               
legislature. SB 54  merely gives legislative approval  for the 18                                                               
acres that were missed in HB 119.                                                                                               
                                                                                                                                
MS.  MOSS  noted  that  the  committee  packets  had  the  annual                                                               
railroad  report to  the House  and  Senate Resources  Committees                                                               
required by  HB 119. The  report has a  brief update on  the land                                                               
sales the railroad is involved in.                                                                                              
                                                                                                                                
1:34:51 PM                                                                                                                    
SENATOR  KIEHL  clarified that  this  did  not involve  land  the                                                               
railroad ran on. He asked if it is railroad reserve land.                                                                       
                                                                                                                                
MS. MOSS answered yes; this is  railroad reserve land that is not                                                               
necessary for operations, as required by statute.                                                                               
                                                                                                                                
1:35:17 PM                                                                                                                    
SENATOR MICCICHE  clarified that the legislation  is about Parcel                                                               
B depicted on the map in the committee packets.                                                                                 
                                                                                                                                
MS. MOSS agreed.                                                                                                                
                                                                                                                                
1:36:02 PM                                                                                                                    
JON   COOK,   Chair,   Board  of   Directors,   Alaska   Railroad                                                               
Corporation, Anchorage,  stated that as Ms.  Moss explained, this                                                               
bill just cleans up a transaction  that was approved by the board                                                               
and legislature. It  was a late session  error. Construction will                                                               
begin in 2019 of  a large hotel complex in the  Otto Lake area in                                                               
Healy. He  hoped it will be  done in an expedited  manner because                                                               
as the  old construction  saying goes,  one day  in May  is worth                                                               
three in October.                                                                                                               
                                                                                                                                
1:37:33 PM                                                                                                                    
PETER GRUNWALDT, Owner, Alaska  Tourism Development, LLC, Premier                                                               
Alaska  Tours,  Inc.,  Anchorage,  said  they  are  working  with                                                               
architects  to develop  drawings  for a  motor coach  maintenance                                                               
facility, a boat house, conference  center, and a 300-room hotel.                                                               
They  had  proceeded  with  the sale  purchase  with  the  Alaska                                                               
railroad last year  for 47 acres. At the end  of the session they                                                               
got 26 acres instead of 47  because of a clerical error. They are                                                               
looking to  start building  a maintenance  facility in  May. That                                                               
sits  on the  adjacent 17  acres that  have not  been transferred                                                               
over yet. Anything that would permit that would be helpful.                                                                     
                                                                                                                                
1:39:53 PM                                                                                                                    
At ease                                                                                                                         
                                                                                                                                
1:40:32 PM                                                                                                                    
CHAIR HUGHES opened public testimony on SB 54,                                                                                  
                                                                                                                                
1:41:54 PM                                                                                                                    
ANDY  BEHREND,   Chief  Counsel,  Alaska   Railroad  Corporation,                                                               
Anchorage,  said SB  54 was  strictly to  correct an  inadvertent                                                               
error. The board had approved the sale of the full area.                                                                        
                                                                                                                                
1:42:23 PM                                                                                                                    
CHAIR HUGHES closed public testimony.                                                                                           
                                                                                                                                
1:42:41 PM                                                                                                                    
SENATOR SHOWER  said that in  Finance that morning  the committee                                                               
discussed   something   involving    AIDEA   [Alaska   Industrial                                                               
Development   and  Export   Authority]  and   the  Denali   south                                                               
campground. He asked if this was that area.                                                                                     
                                                                                                                                
MS. MOSS  replied no, that is  on the south side  of Denali. Otto                                                               
Lake is on the north side near Healy.                                                                                           
                                                                                                                                
1:43:23 PM                                                                                                                    
CHAIR HUGHES held SB 54 in committee.