Former governor talks up railroad

Posted: Thursday, March 23, 2000

Even though the nearest junction is about 100 miles away, the Alaska Railroad was the topic at Wednesday's Kenai Chamber of Commerce lunch.

Former Gov. Bill Sheffield, CEO of the railroad, arrived at Paradisos Restaurant in a limousine, something that obviously made him uncomfortable.

"Harold (Ward) brought me over in the limousine, and it'll probably be in tomorrow's Anchorage paper that 'That damned railroad guy went down to Kenai and got a limousine ride,'" he said. "So I told Harold to go back and get his van for the return trip."

It wasn't the only laugh Sheffield got from the room full of business leaders. He reminisced about a fishing trip to Kenai he took while still governor.

"I went fishing with the one person a governor should never go fishing with, and that's Bob Penney," Sheffield said. "When I returned to do an interview with (radio newsman) Jim Heim, there were picket signs all over the place."

He said he never thought it would ever happen to anyone again, but it did, just last week, when Gov. Tony Knowles was in town after appointing Penney to the North Pacific Fisheries Management Council.

"I guess Bob Penney rides again," Sheffield said.

After the laughter died down, Sheffield got down to business and outlined a brief history of the railroad and the changes that have taken place recently.

"The state bought the railroad (from the federal government) for $22.3 million in 1985, and got $10.9 million in operating funds from the state," he said. "Ever since, we've been on our own with no more subsidy from the state."

He said railroad employees are not state employees, not part of the state retirement system, and the railroad is free to negotiate contracts with them outside of legislative oversight.

Some factions in government would like to see the railroad sold off to private companies for efficiency's sake, but Sheffield pointed out that the railroad turned a profit every year since 1985, except for two in the early 90s when it underwent a reorganization.

"We gross $94 million a year and like to make $8 million to $9 million a year," he said. "But we had a fuel spill earlier this year that will affect our profits for about three years."

He went on to address the December 22 fuel spill, 36 miles north of Talkeetna, saying if you look at it in the big picture, it barely registers.

"It was our third spill since 1985, and if you talk about the amount of fuel we've carried in that time, it doesn't even amount to 1 percent," he said.

Sheffield said the railroad ships 3 1/2 million tons of fuel from the Mapco refinery near Fairbanks to the Anchorage International Airport alone.

"They couldn't have a refinery in Fairbanks without the railroad," he said.

Sheffield added that a new railroad station is part of the ongoing terminal upgrade at the Anchorage airport.

"At the north side of the parking garage, at roof level, we'll have two tracks, a platform in between them, and a waiting room," he said. "There will be great views of all the mountains."

He said the train terminal at the airport would be used primarily to serve cruise ship passengers from Seward.

"My $1 million idea to get a train into the Anchorage airport is going to cost $28 million," he said. "I guess it overran a little bit, but that's what happens when you get architects and engineers involved."

Projects in the future include a spur line to Fort Greely, if the proposed antiballistic missile launch site is ever built there. Since that is halfway to the Canadian border from Fairbanks, Sheffield said it might be feasible then to connect the line with the Canadian railroad.

He also said an arctic railroad someday could be built to the Kotzebue area to serve the Red Dog zinc and lead mine there, as well as a huge nearby reserve of what he described as "the world's best coal."

"It might not be built in my lifetime, but certainly in most of your lifetimes," he said. "Of course, then Gov. Hickel will want to continue that line and run it across to Russia."

The other pie-in-the-sky railroad concept is a line across Turnagain Arm straight to Kenai.

"Now, don't publish on the front page that we're going to do this right now," Sheffield said. "But if they ever built a causeway, of course we'd like a rail line on it to bring a train to Kenai."

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