Legislature(2015 - 2016)BUTROVICH 205
02/03/2015 01:00 PM House TRANSPORTATION
| Audio | Topic |
|---|---|
| Start | |
| Overview of the Alaska Railroad | |
| Port Mackenzie Railroad Extension Update | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
ALASKA STATE LEGISLATURE
JOINT MEETING
SENATE TRANSPORTATION STANDING COMMITTEE
HOUSE TRANSPORTATION STANDING COMMITTEE
February 3, 2015
1:09 p.m.
MEMBERS PRESENT
SENATE TRANSPORTATION
Senator Peter Micciche, Chair
Senator Click Bishop, Vice Chair
Senator Mike Dunleavy
Senator Dennis Egan
Senator Bert Stedman
HOUSE TRANSPORTATION
Representative Neal Foster, Co-Chair
Representative Shelley Hughes, Co-Chair
Representative Charisse Millett
Representative Benjamin Nageak
Representative Louise Stutes
Representative Matt Claman
Representative Dan Ortiz
MEMBERS ABSENT
SENATE TRANSPORTATION
All members present
HOUSE TRANSPORTATION
All members present
OTHER LEGISLATORS PRESENT
Representative Sam Kito
Representative Jim Colver
COMMITTEE CALENDAR
OVERVIEW OF THE ALASKA RAILROAD
- HEARD
PORT MACKENZIE RAILROAD EXTENSION UPDATE
- HEARD
PREVIOUS COMMITTEE ACTION
No previous action to record
WITNESS REGISTER
BILL O'LEARY, President and CEO
Alaska Railroad Corporation (ARRC)
Anchorage, Alaska
POSITION STATEMENT: Provided Alaska Railroad Corporation (ARRC)
update.
JOHN MOOSEY, Manager
Mat-Su Borough
Palmer, Alaska
POSITION STATEMENT: Provided overview of the Port MacKenzie
project.
JOE PERKINS, Project Director
Mat-Su Borough
Palmer, Alaska
POSITION STATEMENT: Provided detailed overview of the Port
MacKenzie project.
ACTION NARRATIVE
1:09:20 PM
CHAIR PETER MICCICHE called the joint meeting of the Senate and
House Transportation Standing Committees to order at 1:09 p.m.
Present at the call to order were Senators Egan, Dunleavy, and
Chair Micciche; Representatives Stutes, Claman, Nageak, Oritz,
Millett, Co-chair Hughes, and Co-Chair Foster.
^Overview of the Alaska Railroad
Overview of the Alaska Railroad
1:10:36 PM
CHAIR MICCICHE announced that the first order of business was
the Alaska Railroad Corporation overview.
1:10:51 PM
BILL O'LEARY, President and CEO, Alaska Railroad Corporation
(ARRC), Anchorage, Alaska, said ARRC is an independent
corporation owned by the state; it's managed by a seven-member
board of directors appointed by the governor; it's mandated to
be self-sustaining and its employees are not state employees.
1:11:28 PM
SENATOR BISHOP joined the committee.
1:11:35 PM
MR. O'LEARY said the Railroad has 656 miles of track going from
Seward to Fairbanks. Last year it carried nearly a half million
passengers and just shy of 5 million tons of freight. It has
$1.1 billion worth of assets and brings in $140-145 million a
year in revenues. It has 575-600 year-round employees and
another 100-125 during the summer season; about three-quarters
of them are members of one of five unions.
1:13:41 PM
The Railroad has three legs to its financial underpinnings. The
first and largest is freight. However, freight started declining
significantly in 2005. He explained that their primary lines of
business include transporting gravel, coal, and bulk petroleum
and the significant drop in petroleum tonnage is a direct result
of the stepping down and conversion from a refinery to a
terminal facility at the North Pole refinery.
REPRESENTATIVE HUGHES asked how physical weight equates to
revenue volume on his chart.
MR. O'LEARY answered that not all lines of revenue are created
equal and historically their largest freight revenue source has
been moving bulk petroleum products, followed by their inter-
line rail-barge services, coal hauls out of Healy, and then
gravel. Gravel is a very heavy but a short haul coming from the
Mat-Su Valley into Anchorage, whereas coal goes from Healy all
the way to Seward.
1:16:11 PM
The second financial leg of ARRC's financial trinity is its
passenger service that is somewhere in the 500,000 passenger
range. The 2008 recession had a significant impact but a
recovery started in 2012.
He explained that ARRC has two different segments of riders:
those that book directly with the Alaska Railroad through its
tour operators and those who work with the cruise companies, as
the Railroad pulls passenger coaches owned by the cruise
companies.
CHAIR MICCICHE asked to see a pie chart of freight revenue
versus passenger revenue.
MR. O'LEARY responded that of $140 million annually, passengers
bring in about $26-27 million and freight brings in around $95-
100 million.
1:18:55 PM
Third, he said the ARRC has real estate holdings. He related
that the Railroad was built by the federal government and
purchased by the state in 1985; with the rolling stock and track
bed 36,000 acres were transferred from federal ownership to the
corporation in 1985. Roughly half of that is used in the
operation of the Railroad itself. The other half is available
for lease or permit use by different private sector or
governmental entities, primarily of economic development type
activities.
He said the Railroad makes significant returns off of leased
properties and owns docks in Seward and Whittier. He couldn't
say enough about the importance of real estate for the Alaska
Railroad as the vagaries of the business cycle hit on freight
and passenger service. It provides a very consistent revenue
stream for the Railroad and feeds a significant portion of its
capital program.
MR. O'LEARY related that all the Railroad's income is
transferred back into the infrastructure. He explained that
year-round scheduled passenger service made it eligible for
significant Federal Transit Administration (FTA) formula monies,
at one point reaching nearly $36 million per year. In the last
FTA re-authorization it was reduced by 20 percent, because a
member of Congress thought ARRC didn't meet the qualifications
for receiving the money (a Ted Stevens issue). That is the
compromise that was struck along with doubling the state's
matching requirement. He said another reauthorization is coming
up in 2015.
1:22:07 PM
He said the Alaska Railroad has been in a near constant state of
financial flux. With the step-down of production at the refinery
which began in 2006, the Railroad went through significant belt
tightening three times resulting in 300 position cuts, wage
freezes, and a modified retirement program, as well as changes
in operations to still provide the needed customer service but
in a less costly manner. The goal was that the Railroad would
look and feel the same on the outside but be different on the
inside.
1:23:48 PM
REPRESENTATIVE NAGEAK asked if the downturns were mostly in
freight.
MR. O'LEARY replied that they primarily related to the petroleum
haul to the refinery outside of Fairbanks and a significant drop
in the coal export line of business.
REPRESENTATIVE MILLETT said the FTA cut was only made to the
ARRC and asked where the rest of our money went.
MR. O'LEARY replied that it wasn't cutting the pie up
differently to other transit operator entities. It went
somewhere else.
CHAIR MICCICHE recognized Representative Kito in the audience.
1:26:22 PM
MR. O'LEARY said the Alaska Railroad is set up to look very much
like private enterprise from the financial reporting
perspective, so they have a measure of net income. Twenty-
fourteen was much stronger than anticipated especially given the
news of the closure of the North Pole refinery, but a lot of
slack was picked up by the inter-line business, which was
directly a result of the increased exploration and development
activity on the North Slope. They also had a very strong
passenger season and an easy winter on both sides, plus the cost
structure changes they made really took effect. So, when that
revenue does come in they are well-prepared to capitalize on it.
CHAIR MICCICHE asked what percentage fuel cost is today versus
one year ago.
MR. O'LEARY answered that now it's in the 12 percent range of
total operating expenses and has no doubt benefited from the
drop in cost of fuel, but there is also a decrease in their fuel
surcharge revenue.
CHAIR MICCICHE recognized Representative Colver in the audience.
1:28:57 PM
REPRESENTATIVE STUTES asked what percentage the fuel cost was
one year ago.
MR. O'LEARY answered around 14-15 percent.
REPRESENTATIVE CLAMAN asked how much of the $.8 million
difference in the net income can be attributed to the drop in
fuel cost.
MR. O'LEARY answered not a significant portion; up to half a
million dollars in fuel savings between 2013 and 2014, but there
are big swings in key revenue items.
In the last couple of years the ARRC has been involved in large
projects involving rail; one is the Northern Rail Extension. The
first phase of that project is a 3,300 foot bridge over the
Tanana River outside of Salcha, which currently provides year-
round access to the military into some of their training
grounds. This $188-million project was funded primarily by the
Department of Defense (DOF), but with $84 million from the
state. The project was completed on time and under budget and
has the ability to return about $1.2 million (in state funds)
back to the general fund. The first phase extends from the
current terminus in the Eielson Air Force Base area down
eventually to the Delta Junction area. At this point, no funding
has been identified for phases 2-4.
CO-CHAIR HUGHES asked if the $1.2 million return to the general
fund was project money that was left over or an annual return.
MR. O'LEARY replied that it is left over capital money.
He said the Mat-Su Borough's Port MacKenzie Rail Extension
Project is a project that the ARRC is acting as sort of the
project manager for. It is progressing nicely, but he would
leave further comments on it to the next presenter.
1:33:41 PM
SENATOR STEDMAN joined the committee.
1:33:54 PM
MR. O'LEARY said this brings them to one of the hottest topics
that the ARRC is facing currently: positive train control (PTC).
It is "the mother of all unfunded federal mandates" that came
about in 2008 as a result of some horrific train accidents. PTC
is a safety overlay that is designed to eliminate or greatly
reduce human-error accidents for train operations. It has a
deadline of December 31, 2015 that absolutely no railroad in the
country is going to meet. No extension has been granted by
Congress so far, but one is expected to occur.
He explained that PTC is roughly a $160-million project, greater
than one year's worth of ARRC revenues. He reported that the
Railroad got an earlier start than most with an appropriation
from Ted Stevens and other funds to use as sort of a
demonstration project before it was mandated.
MR. O'LEARY said because of revenue shortfalls it is clear the
Alaska Railroad will not be able to finish this project on its
own. Over the past two years the legislature gave them a total
of $34 million to keep this project moving and the Railroad has
roughly $70 million of its own funds into this project, but
another $55 million is needed to complete the project.
1:36:09 PM
At ease
1:36:54 PM
Back to order.
1:37:25 PM
MR. O'LEARLY stated that they have searched and found there is
no way out of this mandate for the Alaska Railroad.
1:38:19 PM
CHAIR MICCICHE asked if he had $160 million to spend on a
railroad would he spend it on PTC.
MR. O'LEARY answered no.
CHAIR MICCICHE asked him for examples of what would be a better
investment for the ARRC to ensure the safety of the public.
MR. O'LEARY said this project takes away from the basics needed
to maintain a safe railroad system in general - rail, ties,
ballast, and bridges in particular for the Alaska Railroad that
require continual upkeep and significant amounts of money.
CHAIR MICCICHE asked how many times he had been to the
legislature in the last five years requesting funding for those
things.
MR. O'LEARY replied the only other time the Railroad requested
funding was for the Northern Rail Extension Bridge to support
the military.
CHAIR MICCICHE asked if PTC looks like a capital project but in
reality is an operating item considering the federal
requirement.
MR. O'LEARY answered that developing and implementing this
system is really a capital project, but another $5-6 million a
year will be needed to maintain it. They would not come back to
the legislature for that.
CHAIR MICCICHE said in his mind it translates to operating
because there is no choice.
REPRESENTATIVE NAGEAK remarked that there was a need for more
transportation especially in rural Alaskan to get resources to
the market, which would enhance revenues for the state and the
Railroad.
1:41:27 PM
MR. O'LEARY responded that the Railroad is a key piece of
infrastructure for this state and expansion of it would be a
good thing. They like to talk about the concept of corridors to
resources more than roads to resources. Roads can be added to
the geometry of a railroad. Island railroads in small areas that
don't necessarily immediately connect to the main line could
make good business sense.
1:42:50 PM
CO-CHAIR HUGHES asked if PTC is really designed for high traffic
areas like New York City, Washington, D.C. and doesn't make
sense for Alaska. In addition, she wanted to know how the
Railroad plans to absorb the additional annual maintenance
requirements.
MR. O'LEARY responded that PTC will make the Railroad safer, but
he would not direct $160 million to it. The maintenance costs
still need to be determined.
SENATOR EGAN asked how many times the Railroad had applied for a
waiver of the PTC requirement and been denied.
MR. O'LEARY answered more than once.
1:45:04 PM
REPRESENTATIVE STUTES asked what the other benefits to the
Railroad would be.
MR. O'LEARY answered getting a more efficient dispatch system
and the signal work will be slightly more efficient. The
regulators all understand that the cost to benefit ratio on this
particular initiative doesn't provide a classic return on
investment.
If the Railroad doesn't comply with the mandate, he said
different fines and civil and criminal penalties can be assessed
on the corporation and on individuals for non-compliance,
especially if it's considered willful non-compliance.
Eventually, regulators would prohibit passenger service, and
passenger service provides a significant amount of jobs and
spending. A 2012 McDowell Group study on how discontinued
passenger service would impact the whole state indicated that it
would affect 2,000 jobs and put 3,700 additional motor trips on
already crowded highways, especially the Parks and Seward
Highways.
REPRESENTATIVE STUTES asked how many Railroads will have PTC
completed by 2015.
MR. O'LEARY said it won't happen.
REPRESENTATIVE STUTES asked by 2018.
MR. O'LEARY answered more; most are pushing for a three-year
extension and planning on 2018. He added that a limited number
of contractors do this work, which makes it even more difficult.
REPRESENTATIVE CLAMAN asked if the extension requires an act of
Congress.
MR. O'LEARY answered that it does require an act of Congress.
1:50:37 PM
He said that PTC is not the end of the world for the Alaska
Railroad. Good opportunities are out there; they have just put
the finishing touches on their strategic plan going forward and
the first one is how to grow their way out of this situation -
how the revenue base can be increased and also support the state
in economic development. A rail/barge service could support oil
field activities; the concept of a pipeline on rails moving LNG
or refined oil products is another idea as is the concept of
additional ports in Port MacKenzie and Seward, and corridors to
resources.
MR. O'LEARY said the Railroad partners with Lynden and the
Canadian National Railroad to provide weekly barge service from
Seattle and Prince Rupert using rail barges. Effectively,
somebody can order a load of pipe from Houston and it can be
railed up on other railroad systems to Seattle where it rolls
onto a rail barge that can take 50 rail cars. It goes up to
Whittier and rolls off onto the ARRC system and can be taken to
Fairbanks or Anchorage or loaded onto trucks to the North Slope.
The Alaska Railroad has the longest rail haul in North America
pushing almost 5,000 miles.
1:53:13 PM
SENATOR STEDMAN asked if there had been any discussion with the
Canadians on their interest in railroading oil north and
delivering it into TAPS.
MR. O'LEARY said they had some discussions on that last year,
but haven't heard anything recently.
SENATOR STEDMAN asked him to explain how that would work.
MR. O'LEARY answered that there are no plans for that, but they
have been transporting refined oil to the Anchorage
International Airport from the North Pole refinery for years and
hope that could come back. At this point they are bringing
refined product from south to north.
SENATOR STEDMAN said he wanted an update on the status of the
Railroad with their clients at the airport and refineries along
with their cash flow positions.
MR. O'LEARY said he would give him an update on that.
CO-CHAIR HUGHES remarked that some folks are floating the idea
of barging propane up from Prince Rupert to Valdez and by train
on up to Fairbanks and asked if he had conversations with them.
1:56:22 PM
MR. O'LEARY replied that Valdez has very little rail and nothing
that connects. It could probably happen if it was brought up to
Whittier or Seward. They had been in contact with a lot of
different people about moving energy, primarily, to the
Interior.
CHAIR MICCICHE said he thought the primary objective of this
slide was to show there are a lot of other opportunities that
the Railroad continues to investigate.
MR. O'LEARY answered yes and they are open for business.
CHAIR MICCICHE asked if a pre-existing railway reduces the cost
of developing a corridor to resources.
1:58:13 PM
MR. O'LEARY answered that that should be part of the
conversation about what makes most sense for access to
resources. The concept of moving LNG to the Interior has been
getting more attention lately. They have always offered their
services to potential shippers as an interim energy solution for
the Interior until the larger gasline is built. Five-day a week
service is already provided year-round between Anchorage and
Fairbanks.
A couple of conditions would need to be met to move LNG to the
Interior on the Railroad: first is approval from the federal
regulators. In December they met with them and got a clear
picture of what it takes to gain that approval and they will be
submitting an application (for moving LNG on ISO tanks on rail
on flat cars) later this week. He explained that ISO cryo-tanks
are about 40 feet long and hold 11,000 gallons; they can be put
on a rail car and moved to different locations.
SENATOR BISHOP emphasized that the Railroad will move goods for
a price.
MR. O'LEARY said yes.
CHAIR MICCICHE said they are very supportive of their mission.
2:02:35 PM
MR. O'LEARY said the Department of Transportation and Public
Facilities (DOTPF) is responsible for a State Rail Plan that is
a prerequisite to continue receiving federal monies. It had
fallen off the radar in past years and was resurrected about
three years ago. It is a planning and vision document about the
different operating railroads in Alaska: the Alaska Railroad and
the White Pass and Yukon Railroad.
MR. O'LEARY concluded that the Railroad is a key piece of
infrastructure in a state that has little of it.
2:05:02 PM
CHAIR MICCICHE asked if the refinery being back in business will
positively affect the Railroad's bottom line.
MR. O'LEARY answered that energy cost is a key piece of why the
refinery is in the position it is in and the answer is yes.
CO-CHAIR HUGHES asked where the additional $55 million for PTC
will come from.
MR. O'LEARY answered originally ARRC wanted to ask the
legislature for $55 million over three years, but realizing that
would be very difficult now, they came up with another creative
solution. He explained that ARRC has the ability to refinance
existing debt that was issued in 2006/07, take that savings and
extend the maturity of the bonds from 2021 to 2025. This would
allow them to max out their borrowing power, which would be an
additional $37 million and therefore they would need only one
$18 million infusion. They could take this financial package to
the debt markets, sell the bonds and fund PTC. However, this
would impact the Railroad by taking away its ability to continue
investing in basic infrastructure.
CO-CHAIR HUGHES asked if the $18 million could be phased over
three years.
MR. O'LEARY answered their goal is to have it all this year, so
the package could be taken intact to the financial markets and
the grantor agency.
CHAIR MICCICHE thanked him for presentation and said he was
worried about how the PTC mandate would affectively delay
maintenance and increase risks that weren't there before.
2:10:36 PM
CHAIR MICCICHE introduced the Port MacKenzie update.
2:11:05 PM
At ease
^Port MacKenzie Railroad Extension Update
Port MacKenzie Railroad Extension Update
2:16:14 PM
CHAIR MICCICHE called the meeting back to order and invited Mr.
Moosey to present the Port MacKenzie Railroad Extension update.
2:16:27 PM
JOHN MOOSEY, Mat-Su Borough Manager, Palmer, Alaska, said he
would relate the activity happening at Port MacKenzie over the
past year and that their project is now two-thirds done. He said
shipping time was reduced by 10 days when their first direct
scrap metal ship went directly from Alaska to Asia instead of
going first to Seattle and then to Asia. The port is able to
operate during the winter months.
CO-CHAIR HUGHES asked if their ability to go straight to Asia
was because of the type of ship that could come into the port.
MR. MOOSEY replied it wasn't the ship type; it's just that now
the infrastructure is in place to be able to start doing it. He
said Port MacKenzie has 14 square miles, 9,000 acres, of
industrial business space that is unencumbered by anything else.
It is controlled almost entirely by the Mat-Su Borough with a
small piece owned by the University (that is cooperating on the
project).
MR. MOOSEY said the port has plenty of deep water for any type
of ship. At dock there are 14 acres for temporary storage of
materials and there are ample opportunities to lease lots for
large projects or for assembling any type of gasline. A recent
Northern Economic study estimated the Port MacKenzie Rail
location could save over $100 million in transportation costs
for a large in-state gasline project, just because of proximity
to the project site.
He said this summer 16 lineal miles of concrete coated pipe was
unloaded at Port MacKenzie. It will be loaded on support vessels
on the work barge, be welded together for underwater pipeline to
connect Furies' new gas/oil platform in Nikiski.
2:22:13 PM
He has two full-time people working real hard to make sure the
port operation has very little overhead; they partner with local
business to provide infrastructure and logistic services. They
are a bulk resource and project commodities port exporting
gravel and timber and importing cement and fuel modules for
construction. They don't compete with anyone, but rather are
complimentary to getting goods and services to and from the
Interior.
For the past nine months he had been working with WesPac
Midstream, an LNG company looking at two-phase project: the
first is going to be a $160 million LNG facility; the second
phase will be another $460 million. Their goal is to bring LNG
to the Fairbanks area. He noted that the ISO containers used to
transport the LNG will also serve as storage when they are
dropped off.
2:24:07 PM
CO-CHAIR HUGHES asked where WesPac is now in deciding to go
forward.
MR. MOOSEY answered they are in lease negotiations with them
now; if things fall as they would like they would be under
construction this summer for the first phase ($160 million).
SENATOR EGAN asked where WesPac is headquartered.
MR. MOOSEY replied Texas; they are a $90 billion conglomerate
with nine on-going projects throughout the United States. So,
this is a small project for them.
CO-CHAIR HUGHES asked when LNG delivery to Fairbanks is expected
to occur.
MR. MOOSEY replied delivery to the city gate would take two
years, but Fairbanks would have to build the infrastructure to
accept the LNG.
CHAIR MICCICHE clarified that Fairbanks LNG is currently meeting
100 percent of Fairbanks current needs, so they are talking
about a potential build-out in the future.
2:27:18 PM
MR. MOOSEY added that the current needs are for less than 20
percent of the population. He said that WesPac is just one of
LNG projects Port MacKenzie is working on. If it works out,
WesPac will be a great tenant but not the only one.
Hilcorp and Alaska Industrial Development and Export Authority
(AIDEA) are interested in buying a gas processing plant owned by
Tita (Pentex is the parent company) near Port MacKenzie.
CHAIR MICCICHE commented that Blue Crest could be added to that
slide in terms of a competing interest in the LNG facility.
2:29:54 PM
MR. MOOSEY added that Blue Crest announced a month ago that it
has an agreement with WesPac to sell them the natural gas. It
bought some assets from Buccaneer about one year ago and is a
new investor in Cook Inlet.
The Central Alaska Energy project is a 6.9 million-gallon fuel
tank farm and could be used to bring in lower cost fuel, mostly
low sulfur diesel fuel. They hope to break ground in 2015; this
is also an AIDEA project that was approved for financing a year
and a half ago.
MR. MOOSEY showed pictures of a 110-car rail loop over a mile in
length that provides great staging for bulk resources, such as
gravel, coal and timber. He said they expect exports to Asia.
Last month the governor and Resource Energy, Inc. (REI) signed
an MOU for natural gas. They believe the REI project and the
WesPac project can all co-exist. The first phase of REI is
getting Cook Inlet gas to Japan. When the state gasline is
available, the project can be scaled up to its full size with
the market still being in Japan.
CHAIR MICCICHE asked if REI has any facilities on the planet.
MR. MOOSEY answered no and that WesPac is looking for a market
in Interior Alaska and using the ISO container concept for
delivering LNG to coastal communities via water. He said the
port can also be used for importing construction materials
easier and less expensively.
2:35:08 PM
JOE PERKINS, Project Director, Mat-Su Borough, Palmer, Alaska,
explained that they broke this project up into six construction
segments of embankment comprise of leveled D1 - and a seventh
segment which includes placing material on the embankment.
Segment eight is basically finishing the job by putting in ties
and rail.
The following is a status of the six segments that start at the
loop and run all the way up to the highway:
Segment 1: Completed embankments.
Segment 2: Runs through the farm district, so the Railroad has
purchased all the land they need and the Borough is in the
process of condemning the covenants (against the state). He
hoped to have all of the segment two land available in four or
five months.
Segment 3: Starts outside of the farm district and heads up to
the Papoose Twins road. All the embankment is finished.
Segment 4: Embankment is under construction and will be
completed next year.
Segment 5: Have funding and are negotiating with Knik-Ahtnu to
purchase the right-of-way that is owned by them. If they are not
successful, they intend to condemn that portion of segment five.
Segment 6: Two new sitings in a Y formation along the main line
to tie into the main line so trains can be turned in any
direction; it includes a new bridge across the Little Susitna
River. That is 100 percent complete and includes all of the
ballast, ties and track. A communications tower was required
there and that is up and completed.
MR. PERKINS said the whole thing is about 30 miles long and is
about 65 percent complete. He said a railroad is not difficult
to build; the only problem is that they maintain at least a 1
percent grade. This means that a road can dip down in a valley,
but the railroad has to fill them. So, in the long run, it is
tougher to build than a road if you're in country that has
hills.
In 2013/14, he reported having 200 direct jobs. All five bridges
are currently under contract. Segments 2 and 5 (the two that
don't have embankments) have no bridges. Starting in 2008 they
had been appropriated a total of $184 million in seven separate
appropriations and one statewide general obligation (GO) bond.
In 2010, they didn't get any money but got it in every other
year. In 2016 it will take $120 million to complete this job;
completion of it is totally dependent on money. He summarized
that segments 1,3,4,6, and 5 are funded; segments 1,3, and 6 are
complete.
REPRESENTATIVE CLAMAN asked if he is asking for $120 million
this year.
MR. PERKINS answered that $35 million is needed this year to
keep the project going (and complete segment 2) and the
remainder of the money is basically to purchase things like ties
and track. Segment 8 is the one that ties the track ballast. The
ballast is being made at Curry and about one-third of it is
already made.
2:43:21 PM
He explained that segment 7 includes fiber optics along the
whole line and another communications tower at the port.
CO-CHAIR HUGHES asked if the communication towers are tied into
infrastructure needed for PTC.
MR. PERKINS answered that the communication towers are needed
for operation of the spur and may later serve some other
function for PTC, but not now. He said they join the total
communications system of the Alaska Railroad. He said Segment 6
is done and the Alaska Railroad is backing trains all the way up
to Miller's Road at the end of it. If they get all the funding
they need it will be complete and operating by the end of 2018.
If it is piecemealed, then the timeline will stretch out and the
cost of the project will go up.
MR. MOOSEY said they understand the state's budget concerns, but
completing this project will create jobs and lessen dependence
on oil.
REPRESENTATIVE STUTES asked how much money his municipality had
put into this project.
MR. MOOSEY answered less than 10 percent, plus staff time and
most of the gravel; no bonding.
CO-CHAIR HUGHES pointed out that this project can add jobs in
the Mat-Su area, but it is a state project that will connect to
the rail system to take things into the Interior, and hopefully
to someday be a route to get things out to very rural
communities. She asked who will maintain the railroad once it is
finished.
2:48:56 PM
MR. PERKINS answered that they are working closely with the
Railroad that has a project manager, also, who he meets with
every two weeks on this project. When all of the land is
"squared away," the land required to operate the railroad will
be transferred to the Railroad including land needed for a
terminal reserve where trains can be parked and fueled and crews
can be changed (600-700 ft. wide in the farm district). In some
cases, they have had to buy uneconomic land remnants and those
will remain with the Mat-Su Borough.
2:50:18 PM
CHAIR MICCICHE thanked them both for being at the meeting and
passed the gavel to Co-chair Hughes.
2:51:55 PM
CO-CHAIR HUGHES adjourned the Joint Meeting of the Senate
Transportation Standing Committee and the House Transportation
Standing Committee at 2:51 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| Feb 3 ARRC House Senate Trans Comm Presentation Final.pdf |
HTRA 2/3/2015 1:00:00 PM |
|
| Feb 3 Port MacKenzie Rail presentation.pdf |
HTRA 2/3/2015 1:00:00 PM |