Legislature(2019 - 2020)BARNES 124
04/23/2019 01:00 PM House TRANSPORTATION
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SJR 11-U.S.-CANADA RAILROAD PRESIDENTIAL PERMIT 1:27:44 PM CO-CHAIR WOOL announced that the final order of business would be CS FOR SENATE JOINT RESOLUTION NO. 11(TRA), Urging the United States to issue a Presidential permit authorizing a railroad crossing of the Alaska-Canada border from state land into Yukon, Canada; and supporting cooperation between the United States and Canada to establish a public-private partnership for construction of a railroad from Alberta, Canada, to the state that would connect the Alaska Railroad to the North American railroad system. 1:28:15 PM AIMEE BUSHNELL, Staff, Senator Shelley Hughes, Alaska State Legislature, presented CSSJR 11(TRA) on behalf of Senator Hughes, prime sponsor. She prefaced her remarks by specifying that CSSJR 11(TRA) is a "railroad resolution" different from a railroad resolution being sponsored by Representative Talerico. She said CSSJR 11(TRA) would urge the federal government to issue a presidential permit to allow a railroad to cross from Canada into Alaska. She explained that presidential permits are necessary to allow infrastructure between the U.S. and neighboring countries. She indicated that the impetus for CSSJR 11(TRA) was the approach of two companies in Canada to the Senate Transportation Standing Committee. The presidential permit is necessary in order for those companies to convince their investors that such a project is feasible. She clarified that CSSJR 11(TRA) "is not tied to either company." Ms. Bushnell stated that the intent of CSSJR 11(TRA) is "to open the economic opportunities for Alaska and allow commerce to come in." She said the rail line would connect to the North American Rail System. She indicated that [Congress] has sought to make this connection for over 100 years. She concluded that CSSJR 11(TRA) would be "that next step" [to securing the presidential permit]. 1:30:38 PM MS. BUSHNELL, in response to a question from Co-Chair Wool, said the sponsor of CSSJR 11(TRA) thought it best to allow the aforementioned companies to come forward to speak rather than speaking on their behalf. CO-CHAIR WOOL noted that would occur at the next hearing on CSSJR 11(TRA). 1:31:08 PM REPRESENTATIVE STORY observed that the proposed joint resolution includes language about the presidential permit and a requirement to check with indigenous citizens. She expressed her appreciation of CSSJR 11(TRA). 1:31:38 PM CO-CHAIR WOOL asked what else would be required other than a presidential permit. MS. BUSHNELL responded that she would have to get back to Co- Chair Wool with an answer. She said the companies in Canada would be concerned with crossing the land of indigenous people. 1:32:31 PM REPRESENTATIVE RASMUSSEN expressed interest in seeing a map of possible routes for a rail line. MS. BUSHNELL said she could procure "a map of what both companies envisioned." CO-CHAIR WOOL related he would like visual aids brought to the committee by the next hearing of CSSJR 11(TRA). MS. BUSHNELL, in response to a query from Co-Chair Wool, related that one of the companies addresses a route from Alberta to Alaska ("A2A"), while the other proposes "Generating for Seven Generations" ("G7G"). She said both plans would start in Fort McMurray in Canada and come through Delta Junction, directly across the border from Canada. The G7G plan would go from Delta Junction to [Valdez], [following] the Trans-Alaska Pipeline route. The A2A plans on going up to Fairbanks and "taking the rail line down." 1:34:24 PM SENATOR SHELLEY HUGHES, Alaska State Legislature, as prime sponsor of CSSJR 11(TRA), stated that the project would not require a funding allocation from the State of Alaska. She said Congress "granted us the authority to have this rail since 1914." She indicated that of the up to 1,000 miles allowable, "we only have 500 right now." She added, "This would be an added 250." She posited that at the time of westward expansion, the event of most significance was the connection of the rail line. She said, "The product that would be shipped pencils out for the business interests that have looked at it." She said the rail could benefit numerous ports in Alaska. SENATOR HUGHES, in response to Co-Chair Wool, confirmed that $17 billion is the estimated cost of the overall project; it would come from private investment. She said the applicable companies have had conversations with indigenous peoples and have been good at "getting their social license." Those conversations will continue. 1:37:57 PM REPRESENTATIVE RASMUSSEN sought to confirm that the project could add infrastructure for those communities that do not presently have connectivity to the rest of the state. SENATOR HUGHES pointed out that there would be infrastructure added to come into Delta Junction, then there are roads from Delta Junction to Fairbanks and rail out of Fairbanks. She added, "There would be some new areas where it would be stretched across." REPRESENTATIVE RASMUSSEN asked, "So, it would connect in at Fairbanks?" SENATOR HUGHES answered yes. She said the other plan would be "to feed the bitumen, liquify it, and put it into TAPS [the Trans-Alaska Pipeline System]." She indicated that the rail line includes a substance much like children's play sand, which makes cleanup of any spilled substances easier, because "it doesn't seep into the ground." She said there would be "well- made containers." She pointed out that currently the Alaska Railroad Corporation is certified to carry diesel, which is a more volatile substance. REPRESENTATIVE RASMUSSEN inquired if this might develop into a passenger line between Canada and Alaska. SENATOR HUGHES answered that the initial development is intended for the movement of products; however, there could be expansion into tourist travel. In that event, she said the same border crossing requirements used at custom stations along roadways would apply to railway border crossings. Senator Hughes, in response to a follow-up question, deferred to Tim Sullivan to explain how [a transition from cargo to passenger carrier] could work. 1:41:20 PM TIM SULLIVAN, JR., Director of External Affairs, Alaska Railroad Corporation, proffered that conversations are still ongoing to figure out how such a transition could work. 1:41:41 PM CO-CHAIR STUTES asked for confirmation that the intent of the rail line is to transport fuel. SENATOR HUGHES answered that what she is calling "the anchor tenet" is bitumen. She said, "Anything else on top of that is icing on the cake." She noted that shipping ports from Alaska to Asia are closer than shipping from other ports. 1:43:23 PM CO-CHAIR WOOL noted that bitumen is also referred to as "tar sands." He summarized that the bitumen would be transported via rail into Alaska, to an Alaska port, then exported somewhere else for refinement. SENATOR HUGHES confirmed that is correct. CO-CHAIR WOOL inquired whether a line starting in Alberta would also connect to the Lower 48. SENATOR HUGHES answered that "Alberta is connected to the Lower 48." She said she is not certain, but "there may be something coming from different directions in Alberta." 1:44:28 PM REPRESENTATIVE CLAMAN asked how many miles would be covered with the estimated cost of $17 billion. SENATOR HUGHES answered that from Alberta to the border of Alaska is 1,200 miles, and from the Alaska border to Fairbanks is 250 miles. In response to a follow-up question, she confirmed the cost would cover the entire distance. REPRESENTATIVE CLAMAN remarked that $17 billion sounds low. 1:45:10 PM MR. SULLIVAN stated that $17 billion is a rough estimate. The typical cost for building rail line ranges between $8 to $10 million per mile; the $17 billion estimate is derived based on $10 million per mile. 1:45:48 PM SENATOR HUGHES offered her understanding that if the presidential permit is granted and all goes as planned, the rail could be installed by 2022. CO-CHAIR WOOL noted that [Representative Talerico] has proposed legislation to get a train from Fairbanks to Delta, and he suggested the two could be done at the same time. 1:47:17 PM REPRESENTATIVE DRUMMOND related an anecdote of traveling from Anchorage to Haines and described seeing Walmart and Sam's Club trucks heading south. She found out that the trucks had originated from Anchorage. At that time, West Coast ports were congested, and it was faster for those companies to send their materials overland from the port in Anchorage to the Midwest markets. She said this eye-opening occurrence took place about 10 years ago. [CSSJR 11(TRA) was held over.]