Governor Dunleavy Signs HB 127, Major Milestone for ARRC Seward Dock Update

July 3, 2022 (Seward, AK) – Alaska Governor Mike Dunleavy signed House Bill 127 (HB 127) into law, marking a milestone for the proposed Alaska Railroad Corporation (ARRC) Seward cruise ship passenger dock project. HB 127 expands the authority of the Alaska Municipal Bond Bank Authority’s bonding capacity to the University of Alaska and regional health organizations, and authorizes the Alaska Railroad Corporation to issue bonds to finance the replacement of the Seward passenger dock. The bill signing ceremony was held today in Seward at the cruise ship terminal. “I am pleased to sign this bill which will help to expand several elements of Alaskan infrastructure in a meaningful and significant way. The planned passenger dock and terminal facility updates in Seward will be a value add to tourism, to the Railroad, to Southcentral Alaska, and to the state as a whole,” said Governor Dunleavy. “I applaud Representative LeBon and those in the Legislature for bringing this smart, streamlined bill across the finish line.” “Governor Dunleavy cemented his support of tourism as a significant renewable resource in Alaska,” said Alaska Railroad Board Chair John Shively. “By giving the ARRC the ability to issue bonds to fund the project in Seward, the ARRC will also be able to maintain its mission of being a self-sustaining entity as it will not have to rely on state funds for the construction of the dock and terminal facility. This new dock and terminal facility will serve as the gateway to unforgettable travel experiences that await in the Great Land.” “With the signing of HB 127, we appreciate Governor Dunleavy’s strong support for ARRC’s ability to finance critical Alaska infrastructure,” said ARRC President and CEO Bill O’Leary. “Seward has been an essential gateway for the railroad to bring people across Alaska for many decades. Replacing the dock and enhancing our passenger terminal will continue an important connection for all Railbelt communities for decades to come. Moving this project forward comes on the cusp of the railroad’s centennial when we’ll celebrate 100 years as a critical transportation link. I can’t think of a more fitting time to begin a project with profound benefit to communities all along our rails.” HB 127 authorizes the Alaska Railroad Corporation to issue revenue bonds to finance the Seward passenger infrastructure up to $60 million. The initial project will construct a new dock, provisional passenger terminal facilities, and associated upland improvements. Future project elements will include constructing a new permanent passenger terminal building. In January 2022, the ARRC Board of Directors authorized the railroad to pursue up to $60 million in funding through ARRC’s statutory authority to issue bonds, subject to state legislative approval, to complete dock design and construction. ARRC is evaluating potential funding sources for the permanent passenger terminal building. Additionally, HB 127 removes the project scope limiting the Bank Authority participation to only heating or energy projects and provides the University with expanded tools for financing and the ability to leverage bond ratings. The legislation expands the opportunities for regional health organizations to use the Bond Bank by removing the 49% single-project participation cap and raises the cap for all regional health organization projects from $205 million to $500 million.