Princess Cruise ship in the Whittier Harbor.

Alaska Railroad Corporation Land Swap

Public Involvement

Public Meeting and Hearings

Alaska Railroad Land Swap Public Comments

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Share your thoughts on the proposed land swap between the City of Whittier and the Alaska Railroad Corporation. Your input is vital to our community’s future. Let us know what you think, ask questions, or give suggestions. Together, we can shape Whittier’s next chapter!

In 1998, the City of Whittier made an agreement with the Alaska Railroad Corporation (“ARRC” or “the Railroad”) known as the Master Lease. This agreement allowed the City to sublease approximately 250 acres of land from ARRC to create income for the City while enabling the Railroad to keep ultimate control of their lands. After 25 years, the City Council determined that the Master Lease isn’t working well for either side anymore. They have asked the City Administration to explore alternative options with ARRC.

The City is interested in expanding the Small Boat Harbor, developing the Glacier Street Property for housing and businesses, and protecting the Head of the Bay. The goal of this land swap is to give Whittier more control over how the land is used, helping with public projects and economic growth. ARRC would continue its railroad operations and have an opportunity to support community projects.

History of the Master Lease

Imagine, or remember, a time before you were able to simply drive through the Anton Anderson Memorial Tunnel to get to Whittier. Back then, our city struggled with a modest tax base. There were no cruise ships gracing our shores, local business was scarce, and much of the land worth developing was locked up under Railroad control. With the completion of the Tunnel would come a tidal wave of traffic, which meant we needed more than just sturdy roads – we needed places to park, bustling businesses, and essential services like police and emergency responders. How could a city with such limited resources even begin to tackle these challenges? At that pivotal moment, our Council and Administration saw a solution: gaining control of the Railroad’s unused lands to manage development, boost property taxes, and secure lease revenue.

Headed to Capitol Hill

As the planning stages of the Anton Anderson Memorial Tunnel retrofit project came to a close, anticipation buzzed through Whittier. The year was 1998, and all eyes turned to the Alaska Legislature as they deliberated on House Bill 412. This pivotal legislation demanded action from the Railroad, compelling them to relinquish “non-essential” lands to the City of Whittier.

Behind the legislative chambers, echoes of testimonies resonated. Community leaders and concerned citizens spoke passionately of Whittier’s plight under the Railroad’s grip. They painted a vivid picture of a city stifled by vast land holdings and bureaucratic red tape. City officials found themselves hamstrung, unable to effectively govern and develop their community under the weight of the Alaska Railroad Corporation’s (ARRC) restrictive policies.

House Bill 412 wasn’t just about land transfer; it symbolized Whittier’s quest for autonomy and self-determination. It was a rallying cry for fairness and balance, aiming to tip the scales back in favor of local governance. The legislative debates crackled with urgency as lawmakers weighed the implications of granting Whittier control over its own destiny. However, despite the collaborative efforts and intentions behind House Bill 412, it was ultimately referred to the Finance Committee and never progressed beyond that point.

Wading into the Heart of the Issue

In the midst of growing tensions and competing interests, the Alaska Railroad Corporation (ARRC) and the City of Whittier embarked on a series of challenging negotiations to forge a path forward. Recognizing the necessity for cooperation, both parties approached the table with cautious optimism. The ARRC, understanding the city’s aspirations for growth and self-governance, offered a significant concession: the Master Lease. This agreement allowed Whittier to sublease approximately 250 acres of ARRC land, thereby empowering the city to manage development activities and bolster its tax base. In return, the ARRC retained a share of the lease revenue and maintained essential rights to ensure their operations remained unhindered. Despite the adversarial nature of their relationship, the negotiations were marked by a mutual recognition of the need to coexist and collaborate. The Railroad demonstrated a willingness to support Whittier’s future while safeguarding its own vital interests, laying the groundwork for a partnership that, while fraught with challenges, aimed at fostering community development amidst competing priorities.

Persistent Contentions

Despite all good intentions, the Master Lease has continued to be a source of contention, impacting critical infrastructure, the city’s tax base, and investment safety.

Critical Infrastructure at Risk: The Master Lease places critical infrastructure such as water wells, water mains, sewer systems, and most roads under uncertainty. These parcels could be deemed “essential” for railroad purposes by the ARRC, potentially jeopardizing Whittier’s ability to maintain and develop essential services.

Tax Base Challenges: The ARRC, as a state-owned entity, is tax exempt, which extends to its lessees and patrons. This exemption limits the City’s ability to raise revenue from commercial and industrial entities that rely on City services. Instead, Whittier must rely heavily on its 310 individual and business taxpayers to generate sufficient revenue to sustain public services.

Impact on Investment Safety: Investor confidence in Whittier is undermined by the ARRC’s authority to terminate leases if the land is deemed “essential” for railroad operations. This uncertainty significantly diminishes property values, particularly for properties with limited remaining lease terms. As a result, lenders are hesitant to finance interests held under subleases with short remaining durations, further stifling potential economic growth and development.

Alaska Railroad Corporation

The Alaska Railroad Corporation spans nearly 500 miles across Alaska, linking Seward to Fairbanks and serving as a critical lifeline for both passengers and freight. Established in 1923 and originally constructed by the U.S. government to access mineral resources, ARRC was pivotal during World War II for transporting military supplies. Today, it remains essential, transporting goods and passengers while managing extensive real estate holdings crucial for economic development.

Whittier and the Railroad: A Symbiotic Relationship

Whittier’s history is deeply intertwined with the Railroad, which recognized the town as a strategic deep-water port during WWII. The railroad infrastructure facilitated Whittier’s growth as a secondary port, supporting essential barge and train-ship services.

A Century of Service and Development

Celebrating its centennial in 2023, ARRC remains Alaska’s last full-service railroad, embodying a blend of historic legacy and modern infrastructure. Its extensive network of tracks, rail yards, and real estate holdings not only supports transportation needs but also fosters economic growth statewide. With a focus on innovation and community partnership, ARRC continues to evolve, ensuring Alaska’s connectivity and economic vitality for generations to come.

Importance of the Land Swap

The ongoing negotiations between the City of Whittier and the Alaska Railroad Corporation (ARRC) hold significant importance for several compelling reasons:

  • Optimizing Resource Allocation: Whittier’s acquisition of the Tank Farm and its willingness to negotiate signify a strategic move to optimize the city’s land resources. By engaging in this negotiation now, Whittier aims to strategically utilize its assets for long-term community benefit.
  • Stimulating Local Economy: The negotiation presents a crucial opportunity for Whittier to enhance its economic landscape. Through a potential land swap, the city could gain access to parcels that are strategically located for commercial and industrial development, thereby attracting new businesses, creating jobs, and expanding the tax base.
  • Improving Public Infrastructure: Ownership of additional land could facilitate significant improvements in public infrastructure such as roads, utilities, and public facilities. This, in turn, enhances the overall quality of life for residents and supports the growing needs of the community.
  • Enhancing Local Control: The negotiation is pivotal in granting Whittier greater local control over its development trajectory. By securing ownership of key parcels, the city can assert more influence over urban planning decisions and community development initiatives.
  • Addressing Contentious Lease Arrangements: The negotiation provides an opportunity to address longstanding issues associated with the Master Lease between Whittier and ARRC. Resolving these issues can mitigate uncertainties related to land use and lease termination clauses, fostering stability and predictability for both parties.
  • Fostering Collaborative Governance: The presence of committed leadership in Whittier and at ARRC underscores a proactive approach to governance. Their willingness to engage in open and honest negotiations with ARRC sets a precedent for collaborative decision-making and mutual respect.

To summarize: the current negotiations between Whittier and the Alaska Railroad Corporation are important for unlocking our economic potential, improving our local infrastructure, enhancing our community’s autonomy, and fostering collaborative relationships. By seizing this opportunity, Whittier aims to position itself for sustainable growth and prosperity while addressing longstanding challenges related to land ownership and development.

Negotiation Updates

Regular updates on the status of negotiations, key meetings, and milestones.

As of June 2024, the City of Whittier and the Railroad have reached a tentative agreement on the land swap proposal, which involves the exchange of about 153 acres of land in total.

A town hall was held on June 18, 2024 for the public to voice their thoughts and concerns regarding this proposed trade.

On July 9, 2024, a City Council work session was facilitated by their independent contractor, Winfluence Strategies, to gather information on properties the Council wished for the City to own and properties the Council was willing to trade.

Timeline

A timeline of key events from the initiation of the Master Lease to the current negotiation phase.

Apr 1943

Railroad to Whittier Completed

The U.S. Army completed construction of the railroad spur to Whittier, which consisted of a 1-mile tunnel through Begich Peak and a 2.5-mile tunnel through Maynard Mountain, thus linking Whittier to the Alaska Railroad’s main line at Portage. This line became Alaska’s main supply link for the war effort during WWII.

Nov 1995

EPA Approves Whittier Access Project

With the increasing traffic to Whittier came a demand for easier access. The Alaska Department of Transportation submitted an Environmental Impact Statement to the U.S. Environmental Protection Agency to construct a highway to Maynard Mountain and transform the existing railroad tunnel into a one-lane, combination highway and railway tunnel that allowed cars and trains to take turns traveling through the tunnel.

Mar 1998

House Bill 412

Representative Cowdery introduced House Bill 412, “An Act providing for the transfer of certain land to the City of Whittier; and providing for an effective date”. This bill would have required the Railroad to transfer some of its lands to the City. The Transportation Committee considered the bill and referred it to the Finance Committee, where it died.

Sep 1998

Construction Began on Whittier Access Project

DOT&PF awarded the tunnel contract to Kiewit Construction Company, who then proceeded to build 1.5 miles of road, one 500 foot long tunnel, and two bridges from the Portage Glacier Highway near the Begich-Boggs Visitor Center to the Bear Valley staging area.

Nov 1998

Master Lease Signed

In an attempt to be responsive to the needs of the City, the Alaska Railroad Corporation and the City of Whittier sign the Ground Lease and Management Agreement (“Master Lease”), granting the City the right to use, occupy, and manage approximately 250 acres of land.

Jun 2000

Tunnel Opened to Vehicular Traffic

After 21 months of construction, the Anton Anderson Memorial Tunnel reopened, this time to train and vehicles, claiming its status as the longest dual mode tunnel in the United States.

Aug 2004

Not a Legislative Priority

The Council considered and failed to pass a resolution making the Master Lease and related land issues a legislative priority for the City by a vote of 5-1.

May 2016

Requesting Relief from Legislature

The Council considered and passed a resolution requesting the Alaska State Legislature and the U.S. Army Corps of Engineers provide the City relief from the economic hardship created by the Railroad failing to transfer ownership of the Delong Dock in a timely manner.

Jun 2018

Delong Dock

The Railroad deeded the Delong Dock to the City as part of a land trade.

Mar 2019

Whittier Manor Grounds Transferred to Condo Association

With the expiration of ARRC Contract No. 5136 coming up on January 1, 2020, the City negotiated with the Whittier Manor Condominium Association to sell the leasehold parcel to the Association.

Mar 2021

Resolution Requesting Non-Essential Lands from the Railroad

The Whittier City Council passed a resolution requesting all non-essential lands held by the Railroad be relased to the City of Whittier in fee simple.

Nov 2023

Established City Lands Advisory Committee

The Whittier City Council passed an ordinance establishing the City Lands Advisory Committee to assist the City Council in planning future land ownership and management decisions in preparation for the Master Lease’s expiration in November 2033 (with the option to extend for two additional 35-year terms).

Mar 2024

Initial Discussion with ARRC

The Mayor, Vice Mayor, Administrative staff, and representatives from the Railroad met for the first time to discuss what lands the City and the Railroad were willing to trade.

Apr 2024

Independent Contractor Hired

At their regular meeting, the Whittier City Council voted 5-1 to enter into a professional services agreement with Winfluence Strategies, LLC to assist the Council with the land swap. At the same time, the City received the first draft proposal for the land swap.

Jun 2024

Town Hall

The City Council and Administration hosted a town hall/work session to gather public input on the proposed land swap.

Jul 2024

Winfluence Leads Work Sessions

The City Council and their contractor, Winfluence Strategies, held work sessions to discuss the specifics of the land swap.

Full Text Documents

Links to full text documents related to the land swap, including the original Master Lease, meeting minutes, negotiation proposals, and other relevant documents.

House Bill 412

1998 Alaska State Legislature House Bill 412

March 4, 1998 House Transportation Committee Minutes

March 18, 1998 House Transportation Committee Minutes

Master Lease

1998 Ground Lease and Management Agreement (“Master Lease”)

Tank Farm

2022 Deed of Conveyance

Environmental Covenants

2010 Site Assessment Report

2023 High Groundwater Monitoring Report

City of Whittier Resolutions

Resolution 2021-008 Requesting ARRC Release all Non-Essential Lands

Resolution 2016-018 Declaring an Economic Hardship

Resolution 744-04 (Failed) Establishing a City of Whittier Legislative Priority to Address and Deal with ARRC-Alaska Railroad Corporation Master Lease and Land Issues

Additional documents coming soon!

Summaries and Explanations

Concise summaries and explanations of key documents for those who may not want to read the full texts.

Coming soon!

Maps and Diagrams

Visual aids such as maps of the land in question, diagrams of proposed land swaps, and any other relevant visuals.

Land Swap Conceptual Maps

Conceptual Map of 2024 Land Swap – as of July 8, 2024

Conceptual Map of 2024 Land Swap – as of April 10, 2024

Master Lease Maps

Master Lease Parcel Maps – as of January 14, 2004

Whittier Core Terminal Reserve Lease Lots – as of November 21, 2011

Head of the Bay Terminal Reserve Lease Lots – as of November 21, 2011

Whittier Reserve Overview Maps

Whittier Reserve Overview – as of March 22, 2024

Whittier Reserve Overview – as of January 22, 2019

Additional documents coming soon!

Will the Whittier Manor lose any of its parking?

No, it will not. The west side parking lot is under a lease with the City of Whittier and is not being considered as part of this proposed land swap. The east side, where the Sportsmans Bar is located, is proposed to be transferred from the Railroad to the City of Whittier.