September 12, 2013 | Volume 43, Number 36

DOT OKs $90K for rail link study

The idea of a railway between Haines and Canada, a dream of some residents, has picked up some steam.

The Haines Borough Tuesday directed manager Mark Earnest to negotiate a grant agreement with the Alaska Department of Transportation, which has offered up $87,000 to draft a study exploring the feasibility of building a railroad from Haines to Delta Junction.

The Haines Port Development Council, a private pro-industry group, requested a preliminary proposal from PROLOG Canada, which performed the $5 million Alaska Canada Rail Link Project feasibility study in the mid-2000s. The council asked PROLOG to expand on that study and analyze what the costs and benefits of a Haines railway would be to the private and public sectors.

Bill Kurz, president of the port development council, then forwarded the proposal to DOT, which is in the midst of conducting a statewide rail plan.

Murray Walsh, the rail plan’s development manager, said he was impressed with PROLOG’s proposal. “The port council sent it to us and we looked at it and said, ‘Hey, you know what, this isn’t bad.’”

Convinced that the state will need to further look into a rail connection between the Interior and northern Southeast at some point, Walsh approached the borough and asked if they wanted in on the project. “We could probably have hired PROLOG directly, but this is something the borough wanted to participate in and provide a little bit of leadership on, and we’re happy to share this.”

Though the study will be completely funded by DOT, the borough will be responsible for managing the contract and keeping tabs on PROLOG. “This is a borough undertaking. The idea to do it came from outside the borough government walls, but the willingness to do it has to come from within the walls, from the assembly and borough leadership,” Walsh said.

Had the borough not jumped at the chance to get in on the project, other studies and projects would have likely taken priority, Walsh said.

Earnest said he is interested to see what the study yields. “It’s either going to be feasible or not, and by getting information we’ll get a better understanding of what all is involved.”

Earnest also pointed out the borough’s comprehensive plan endorses the proactive exploration of the possibility of a railroad between the Lutak port area, the Yukon Territory and the Interior.

PROLOG will perform a private and public sector assessment. For the private sector assessment, the company will estimate commercial revenues, operating costs and investment capital for Haines rail access.

Potential private revenue sources include mining companies Crest Iron Ore, Prophecy Platinum, Casino Copper Concentrate, and Mackenzie Delta/Beaufort Oil and Gas.

The public sector assessment will examine potential effects on the economy, such as increased tourism and job creation.

Council president Kurz said getting the feasibility study is a major step toward investors taking the project seriously. “This gets us the honest, up-to-date answers as to whether it’s feasible, and that is what you go to investors with,” he said.

Kurz emphasized the study is not just a benefit for Haines; regional leaders including Whitehorse city councilman Kirk Cameron, Chilkoot Indian Association tribal president John Katzeek and Yukon Minister of Economic Development Currie Dixon sent letters to the council backing the study.

“There’s regional support for this. It’s not just a hometown, Haines thing,” Kurz said.

Kurz said the study should be completed in four months.

Kurz is working with DOT to ensure the development council can retain some control of the project, even though it is being funded through the borough.