Skagway officials are hoping to make a deal with White Pass and Yukon Route to keep dock infrastructure in place when the lease between the two parties expires next March.
That deal would also allow the city early access to the docks to begin redevelopment, but it could leave the municipality on the hook for cleaning up the contaminated harbor and uplands.
Newly re-elected Assembly member Orion Hanson said that he got word late last week that White Pass would agree to what he calls a walkaway deal with the municipality. He then authored a resolution to be considered by the Assembly on Thursday.
The deal calls for White Pass to leave all infrastructure on the Ore and Broadway Docks, which would become municipal property at the end of the 55-year lease next March. White Pass estimates the value at around $40 million.
In exchange, White Pass would no longer be responsible for the remediation of the Ore Basin or uplands contaminated during the lease, if the cost is less than $15 million. If the cost is more than $15 million, Hanson says the municipality could then seek restitution from White Pass and any subletters.
The municipality recently applied for permits from the U.S. Army Corps of Engineers to expand the Ore Dock to allow for a larger class of cruise ships to dock there for the 2023 cruise season and beyond. City officials then learned that White Pass had also applied for permits with the Army Corps of Engineers to remove much of its infrastructure from both the Ore Dock and Broadway Dock.
If White Pass removes its infrastructure, it would render the two docks essentially unusable for the 2023 cruise season. Hanson says neither permit would likely be issued until an agreement is reached between the two parties.
“I think what’s most important is that we have economic stability for next year and beyond. I am willing to compromise,” Hanson said.
White Pass and Yukon Route dredged and removed about 3,000 cubic yards of contaminated sediment this spring at an estimated cost of just under $4 million. A 2014 report by the Alaska Department of Environmental Conservation said that up to 200,000 cubic yards of sediment may have to be removed before the harbor was considered remediated.
