Young, Palin, Stevens, Ellis on the Knik Arm bridge

Posted by Alaska_Politics

Posted: June 9, 2008 - 11:00 am

From Kyle Hopkins in Anchorage -

Here's more from some of the people interviewed for today's story on the Knik Arm bridge project.

First, some paperwork:

-- A letter from the state DOT to the Knik Arm Bridge and Toll Authority.

-- A letter from Sen. Johnny Ellis and Rep. Les Gara to Palin.

-- KABATA's response to Ellis and Gara.

REP. DON YOUNG:

"This project should go forward, it's badly needed for the state in the future.

"It's an issue that's been around forever. ... many years ago, 1980, we actually had an EIS prepared. Of course the price of oil went down. We were able to get federal dollars to get this project on the road.

"As far as George Wuerch, mayor Wuerch leaving, there was reasons for that. It had nothing to do with KABATA. That shouldn't even be part of the discussion. He had his own purposes for doing that. The other gentleman, my understanding was that he was ready to move anyway. So I don't think it has anything to do with the project. The project's a good project."

...

"I get a little bit, you know, concerned when I watch people's attitudes say well, we don't need it (the bridge) now. Well it's sort of like you don't need to eat dinner at breakfast time either. You need to have dinner later on. And it's time that we recognize that our area there is growing very rapidly, will continue to grow, is going to be congested."

...

"You've got to look ahead in this business ... that's what people don't quite understand about a vision."

...

Do you plan to ask for more (federal) funding?

"Oh, I always ask for funding, you know that. But again, this is not just my project. This is the project the state's been after for a long, long time and the if the state was really thinking about the future instead of present applause - they would be putting money into infrastructure right now, for the future, not later on down the line."

...

"It'll eventually happen. Those that don't want it to happen are doing everything they can to keep it from happening, but the reality is the state needs it. This is not about Anchorage, this is about the state. You know, the sooner people realize that and stop being parochial they'll be better off."

...

(Former deputy director Jordan) says, look, the state could make it happen right now by kind of investing more in the project ...

"There's no doubt the state could build the whole thing. It's now much money when you've got $43 billion in a coffee can."

I guess that's what I'm asking, should the state ...

"My job was to get the money, if the project is worthwhile, it's there. KABATA's going well and I think it will be completed. Now the state should, but that's their prerogative, I can't tell them what to do."

You're saying obviously you can't tell them what to do, but is that the way to go? For people who want to see the bridge built, is that what should happen?

"All I'm saying the project is such a good project, people should know that and they should insist it get done. And how it gets done is another story. I've done my job and I'm going to continue to do my job. As we go into the new highway bill I'm going to be thinking about Knik crossing."

...

Can you tell me specifics, like how much you plan to ask for?

"No - just going to go through the process. I'm hoping the state wakes up and if they don't, I'm going to make sure the vision I have for the state is implemented. And that's for the good of the people."

...

"You have to look down the road where we're going to be. Today is gone. You have to look were we're going to be 50 years from now. And not to have this bridge built as soon as possible for 50 years down the road is not really looking at the future. It's looking at the present, and the present is already gone."

But there was so much criticism of it before - it got the "bridge to nowhere" thing and it just ...

"Stop, that has nothing to do with the project. The project is a good project. No one can dispute that other than those that are naysayers and nimbys. This is the right thing to do."

GOV. SARAH PALIN

"That's a pretty major change there to see not only the departure of Darryl Jordan a bit ago, but then Wuerch also, who has been just a key centerpoint in this project for what, five years? However long it's been. Now is definitely the time to take the pulse of the project and for the state to make sure that results of our due diligence can be analyzed and decided upon if terms of any kind of agreement to move forward with this project would be in Alaskans best interest. Now is the time to make sure ..."

Is that what the state's doing is, is reviewing kind of the deal that KABATA's working on?

"Yeah, exactly. And depending on the results of that and due diligence, we need to decide whether the state is put at risk with any of the provisions in the agreement with private partners."

Do you in general support the idea of building a Knik Arm bridge?

"You know in general I always have, growing up out there in the Valley. I've always had that, shared that vision with others, that we would have that physical linkage with the municipality of Anchorage and I am such a proponent of muscled up infrastructure in Alaska in general and you know, beefing up our infrastructure.

"It's needed in Alaska and usually it's a very good thing. But with this project now in the position that it is - first you know it was a project that so many had counted on receiving fully federal funding of it, with Don Young's position formerly as chair of transportation. You know it was assumed that the feds would be paying for the project.

"Well things have changed there on the federal front, haven't they? Without Don Young being in that position, in our future here, things have changed. And now with some of the players in KABATA leaving, we need to make sure, again, that due diligence is undertaken right now and that the project is a sensible project for Alaska."

...

What did it mean to you when George Wuerch left? How did you interpret that?

"I took his letter of resignation at face value. I took it for what it was. It was short and sweet deciding that he was going to pursue other opportunities. But it also provides a good healthy opportunity for everyone now to question the project. To crunch numbers, to provide that due diligence again that we need to make sure is being conducted."

...

"Until our review is complete, the state isn't going to commit to terms of any KABATA agreement with private partners that wouldn't be in Alaska's best interests. We need a complete review. We need to see if things have changed in the last couple years also, from when the project seemed to have a lot of steam, a lot of energy behind it to where we are now where we haven't heard a whole lot. The public hasn't heard a whole lot about KABATA's creative financing proposals. And Alaskans really need to get plugged into this project if it's going to go forward."

Have you chosen a replacement for Wuerch as board chairman?

"No, because that's up to the board members also to be figuring out what it is that they need. What strengths will be tapped into in terms of a person filling that role."

...

"We want to make sure that pieces of the puzzle here are coming together and this isn't just going to be a, some kind of shot in the dark, throw a bunch of money at a project without it being lined out sensibly."

(Jordan) talked a little bit about state funding, that maybe the thing that needs to happen in order for the bridge to proceed is for the state to make more of a financial commitment. Is that something that you'd be willing to do?

Note: Jordan talked about the state guaranteeing bonds.

"Not at any cost, no. No, the state's not going to take a position there of an open checkbook without having all of the information in front of us. So no, I wouldn't commit to that just not at any cost to the public ..."

What's at stake here for KABATA if you guys don't like what you hear, is that the end of KABATA?

"Well, it's going to ultimately be in the hands of those who hold the purse strings. Of legislators who either will or will not support a greater state subsidy in this project. And again, this is all assuming that our tough questions are going to be answered with legitimate numbers that we need in order to make it a true and fair evaluation of this, to be ultimately presented to those who hold the purse strings.

"And you know we've heard numbers of up to a $1 billion that perhaps would be necessary. Now we are, granted, in a time of surplus in our state. But would those who hold the purse strings to the state's budget want to spend $1 billion on one project or would our legislature working with administration, working with KABATA want to pursue other opportunities for financing?

"And then I go back to what the public and the administration had been told for all these years, and that is that creative private sector financing of this project would be the thing to see the project come to fruition. So we got to evaluate that and see if that's legit, and that's happening."

You said you've heard numbers of up to a billion. Up to a billion that the state would kick in, or up to a billion that the whole thing would cost.

"No - up to a billion that the state would have to kick in."

Who said that?

"We've heard this from a couple of DOT officials, asking the questions also."

"... If the project shows that we, that it's not going to take many state general fund dollars and that there would be no financial risk to the state in moving forward. Then it's probably worth it for the state to provide that funding. That's one end of the spectrum.

"The other end of the spectrum, again, is if what we hear is it could cost the state a billion dollars and that would result in huge financial risk allocated to the state, then it may not be worth it for the state to pursue the project. That's why this review, this due diligence, is paramount ..."

NOTE: KABATA says there's no way the project would cost the state $1 billion because their plan is for private investors to pay the bulk of the bill.

SEN. TED STEVENS:

Stevens sent this written statement on the bridge:

"At the request of local residents, local communities, and the State, the Alaska Congressional Delegation worked for over 30 years to get the Knik Arm bridge in the 'cycle' for federal funding. After getting some planning money earlier, in 2005 we were able to secure $231 million from the Highway Trust Fund for the construction of this bridge. This was one out of 282 bridges funded by the highway bill passed by Congress that year.

"The Knik Arm bridge will open areas of Alaska to much-needed growth and economic development. With estimates projecting the population of Southcentral Alaska will grow by up to 200,000 people in the next 25 years, Alaskans need the Knik Arm Crossing to handle the area's growing transportation needs. The Knik Arm bridge will also foster economic opportunities in surrounding communities. This project will open up new areas for home construction and business development, enabling the Anchorage area to keep pace with population forecasts.

"The State has significant amounts of federal funding that it can use for this project. If additional funds are needed, I am prepared to support this project as is appropriate. But the decisions about how best to proceed on the construction of this bridge will be made by the State and local communities."

STATE SEN. JOHNNY ELLIS:

Any sense of why Wuerch stepped down as chairman of that board?

"Well that's a big question on the minds of a lot of people who have observed this process since the beginning. I know that my constituents on Government Hill, they always predicted things wouldn't pan out there. They felt mistreated from the get-go by the leadership there at KABATA.

"You know I was a no vote in Juneau on the original authorization legislation."

That created KABATA?

"Yes, because I didn't think I thought it was a blank check essentially in terms of power, responsibility, transparency. None of those things that I wanted and that are talked about by the Palin administration are included in that authorizing legislation.

"I felt that we were granting too much power to a semi-autonomous group that would, did have the power under that legislation to put the state of Alaska on the hook financially. And I was never comfortable with that and I said so at the time and voted no. That was not meant as an anti-growth vote. That was meant as a fiscal responsibility vote on my part."

...

"Les Gara and I have been clear on this from the beginning ... we sponsored legislation this last year that would have held KABATA to a higher standard of scrutiny and transparency by the public to avoid any kind of boondoggles in the future, white elephants. And I personally met with commissioner Pat Galvin, and he's busy now, we're all busy going into special session with the TransCanada proposal, but while we were in regular session, I met with Galvin and said I believe Rep. Gara and I are reflecting what your administration stands for in terms of fiscal responsibility and transparency, and I don't believe KABATA - I think KABATA is taking us down a road that you all are going to be embarrassed about and regret in the future.

"And so the legislation got a hearing on the Senate side ... It was filed in the middle of the session, didn't get all the way through. But I wanted, Les and I both wanted to make statements and put people on notice that we better keep a sharp eye on what's going on at KABATA or we will rue the day that we didn't pay attention."

And that's because ... Why is that?

"I think the state of Alaska could be on the hook. If they come up with a bad deal, I think the state of Alaska will be on the hook and I don't really believe their numbers. I don't believe that number of people will pay that high a toll to cross that bridge, you know one lane in each direction. So I don't know what the international money markets are going to come up with, but it's important that those international money folks know the full story and even the public in Alaska won't know the full story unless there's more light shining on the activities and financing plans of KABATA."

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