Anchorage Daily News

Down at the docks, former Gov. Bill Sheffield is leading an expansion of Anchorage's port that is huge, controversial and increasingly expensive.

The latest price estimate: up to $700 million.

The project is so big that even the consultants have consultants.

The plan isn't just for a bigger dock. The port aims to tear out the old structure section by section and build an entirely new one twice as long.

The design is unconventional. Instead of familiar pilings supporting a dock, the plan is for crews to erect a long wall of steel in Knik Arm. Millions of tons of gravel will fill in between the steel wall and land, more than doubling the land mass of a port now hemmed in by Elmendorf Air Force Base. The gravel will be packed into an area now used by salmon and belugas, then paved over with asphalt and concrete.

Sheffield, the port director since 2001, is relentless in his pursuit of the project. He is a political ally of U.S. Rep. Don Young, who along with U.S. Sen. Ted Stevens has steered tens of millions in earmarks to the expansion.

Some biologists fear the project could harm salmon and beluga whales. Some engineers aren't convinced the new dock will hold up in a devastating earthquake. Environmentalists question why it didn't get a more thorough government review. Neighbors worry about what all that new land will be used for.

Port officials and their engineers say the project is sound and necessary to replace an old dock that has outlasted its expected life span. The design may not be familiar in Anchorage, but it's been used all over Alaska.

The project is still in early stages. Project managers just awarded the biggest contract so far, $95 million for work this summer and next that includes installing the first sheet pile and filling the horseshoe shapes with gravel.

Sheffield and a team under his watch are trying to pull off the biggest public works project in the history of Anchorage. If they succeed, supporters say, enough ships will come to justify it, and the salmon will still migrate. If all goes well, most people will never even notice.

BIG NEW WATERFRONT

Most people take the port for granted, but 75 percent of the goods sold in Alaska come through it. Cookies and milk, Dockers and Crocs, bikes and SUVs -- it all arrives on cargo ships that dock in Anchorage twice a week, more often in the summer.

"Anything you eat, drink, wear or drive has come up on our ships," says George Lowery, Alaska director for Totem Ocean Trailer Express Inc., or TOTE, which carries cargo for Wal-Mart and Fred Meyer among others.

No one disputes that Alaska's biggest port needs an overhaul. The Port of Anchorage began operations in 1961. Some of it was weakened in the 1964 earthquake. The old pilings are corroding, and maintaining them is expensive at more than $1 million a year.

"We're not against expansion," said Julie Jessal, president of the Government Hill Community Council, where residents have the town's best view of the seaport. "But let's be thinking smartly about it instead of building things that are unnecessary."

The scene from Government Hill will change dramatically, starting with construction that may stretch past 2013. More than that, residents worry about how all that new land might be used. What if dusty coal ends up stored there, or something else equally noxious? Jessal asked.

She and other critics say they don't see the need for the huge project and question whether the port is overbuilding.

The community council pushed the port to specify who will use the new space. "Is there a huge industry that we are anticipating?" Jessal said. "A huge population increase?"

The port's short answer: No.

According to a 2006 report by the port, the four main berths are in use only about half the time.

Maybe cruise ships will come, Sheffield says. Maybe more container ships direct from Asia. Maybe vessels hauling materials for a natural gas pipeline. One company plans to build two new silos for storing cement. Nothing else is firm.

Port officials point to a trend of steady growth in port traffic and current conflicts between those who dock there. In the summer, for instance, unloading the cement ship can take weeks because it must wait for dry weather. The port is already operating "at or above sustainable practical capacity," port documents insist.

Anchorage Mayor Mark Begich said he reviewed the project closely after taking office in 2003 to make sure it wasn't being "oversized." He said he became convinced it's needed to replace the deteriorating old port and build for the future. And, he noted, it's being done in phases over many years.

"It is really not just Anchorage's port. It's Alaska's port," the mayor said.

The real need is for more land for operations, especially for cargo handling and staging areas for the military, the port said in a September 2006 report to the U.S. Army Corps of Engineers.

Not so, said Bob Shavelson, executive director of the watchdog group Cook Inletkeeper. All the talk about homeland security is just a smokescreen to rationalize what's happening, he said. "You see an effort to wrap this in a national security blanket."

It's true that more goods are arriving in Anchorage. In the last 15 years, new hotels have sprung up along with big stores like Barnes and Noble, all stocked with goods shipped from Outside, said Ken Privratsky, general manager in Alaska of Horizon Lines, one of two main cargo shippers in Anchorage. And two Target stores are coming to town with another opening in the Valley.

Yet even shippers aren't united.

Horizon Lines unloads its ships with cranes and supports a bigger port with bigger cranes for bigger ships loaded with more cargo, Privratsky said.

"We would double our capacity, generally," he said.

TOTE, with ships just a few years old that dock in Anchorage, doesn't use cranes. Cargo rolls off its ships on semi-trailers.

"We'd fit into the neutral category. This isn't something we had pushed for or asked to be done," Lowery said.

At any rate, total tonnage shipped through the Port of Anchorage is down from a peak in 2005. That's just because Flint Hills Resources Alaska in North Pole quit making a petroleum product used in goods like plastics that used to be exported on tankers, Sheffield said.

MORPHING MEGAPORT

The numbers are remarkable:

Total new land being created in Knik Arm: 135 acres.

Gravel and sand for fill: 11 million cubic yards.

Height of dock, from bottom of sea: Eight stories at the tallest.

Length of steel wall: 1.5 miles.

Before Sheffield became director in 2001, the port was working toward a smaller and more conventional expansion. In 2002, Tryck Nyman Hayes, the engineers who submitted an early design, estimated it would cost $80 million to $100 million. The oldest part of the dock and broken pilings would have been replaced with a new deep draft dock; a small area of tidelands would have been filled in.

Then-Mayor George Wuerch put Sheffield in charge.

"They just kind of scrapped the whole deal and decided they would mow over the whole port," said Richard Burg, who lost his job as port engineer in 2002 in a dispute over the megaproject. He said he wouldn't sign off on it because he didn't see the need.

Sheffield fell in love with a design patented by PND Engineers Inc. It uses sheets of steel to create horseshoe-shaped compartments filled with gravel. They call it "open cell sheet pile."

Sheffield says that design is one-third the price, less subject to corrosion and easier to maintain than a traditional dock the same size.

Asked for evidence the gravel-filled honeycomb costs less than a dock on pilings, port officials pointed to an analysis by PND, which has millions at stake, as well as an estimate by another firm.

But the estimates are fluid. PND's more recent figures show its design can be built for about half the price of a traditional dock -- plus or minus 25 percent.

The National Marine Fisheries Service says the port never did a true comparison of costs.

In June 2003, the price was estimated at $227 million; by August 2004, $300 million; by May 2007, $375 million.

"Right now we're using $526 million, but it will rise," Sheffield told the Anchorage Assembly in January.

In fact, this month, Begich's office began calling it a $700 million project, just to be on the safe side.

The cost of steel and asphalt have gone up dramatically, and a slew of other factors contribute to the escalating bill, including a year delay in the project while waiting for the key permit, and whale monitoring that must continue a year after construction ends, project managers say.

Wuerch, the former mayor, now heads the controversial Knik Arm Bridge and Toll Authority, another proposed megaproject in the neighborhood. An access road to the bridge, if it's ever built, could go across the backside of the port, Sheffield said.

When bids were sought for the port design, project managers only were interested in the "open cell sheet pile" approach. PND, which has patented the design Sheffield wanted, was the lone bidder.

And the once-modest project morphed into a whole new port.

WHAT ABOUT THE SALMON?

Three federal agencies -- the National Marine Fisheries Service, the U.S. Fish and Wildlife Service, and the U.S. Environmental Protection Agency -- opposed the design.

They pushed the port to consider a dock partially on pilings to allow easier fish passage and to fill in less land. The project as is violates the Clean Water Act, they said.

Port officials didn't budge.

Biologists worry the project may hurt beluga whales and salmon from Ship Creek and Mat-Su streams.

Knik Arm may look muddy and undesirable for fish, but recent studies found that salmon hang out there nearly all summer long before heading to sea, said Ann Rappoport, field supervisor for the U.S. Fish and Wildlife Service in Anchorage.

With the new port, shallow resting places for juvenile salmon will be replaced by a wall of steel in deep water. Urban anglers going after hatchery kings and silvers in Ship Creek may find fewer fish. Wild salmon from the Mat-Su could have trouble migrating, too.

"What the project is doing is filling in the last remnants of the Ship Creek estuary," said fisheries biologist Brian Lance of the National Marine Fisheries Service.

Beyond that, noise from port construction could threaten the declining population of Cook Inlet beluga whales, biologists say. Belugas also will lose valuable habitat near shore.

The federal Maritime Administration, known as Marad, is guiding the project through the bureaucracy. Marad, with a mission of promoting maritime commerce, had never overseen a port expansion before but is cutting through bureaucracy to get the Anchorage project through quickly, Sheffield said. It decided the project didn't need a comprehensive environmental review and issued a "finding of no significant impact" in 2005.

The Army Corps of Engineers came to the same conclusion last year. In August, the corps signed off on the project, issuing the key permit that allows it to fill in tidal lands.

"The port project is large, controversial and will have substantial environmental impacts that have not received adequate attention," Robert Mecum, acting administrator for the National Marine Fisheries Service in Alaska, wrote to the corps in response to that decision.

The port's already in an industrial area, not prime habitat, port managers say. It is dredged from May to November, according to the corps, which oversees that work. Fish and whales are being taken into account. Pile driving work must stop if whale watchers spot belugas close by. Noisy work will ramp up slowly each day to give whales time to clear out. The dock was redesigned to provide rocky recesses where fish can rest between stretches of steel, an amenity biologists scoff at and that geotechnical engineers worry may weaken the structure.

The port also agreed to spend $8 million on "mitigation" projects still being worked out.

Biologists say that won't replace what's being lost.

IN THE EARTHQUAKE ZONE

Engineers and federal agencies raised concerns about the new structure's stability in a big earthquake.

Could the sheets of metal unzip? Would the dock collapse? If the steel ruptures, will gravel pour into Cook Inlet?

Engineers on the city's Geotechnical Advisory Commission have repeatedly called for the project design to be reviewed by an independent panel of experts.

"We're pushing the technology here," said Mark Musial, a geotechnical engineer with Golder Associates and commission member.

Most West Coast ports have traditional docks at least in part.

The Anchorage port design is "aggressive and unprecedented," concluded a December 2006 report by the U.S. Army Corps Engineer Research and Development Center in Vicksburg, Miss.

There's never been a dock of this design this big, the port acknowledged.

The center is building a $1.4 million model of Knik Arm and the new dock. It will fill half a warehouse. Engineers are trying to simulate the extreme tides, currents and increasing sedimentation in Cook Inlet to evaluate what effect the structure will have, said Steve Boardman, chief of the civil project management branch for the corps in Alaska.

Contractors and port officials say they have layers of engineering and independent reviews to ensure the structure's safety. "And we're not done yet," Sheffield says.

PND's gravel-filled U-shaped design has been used since 1981 in Alaska with great success, said Dennis Nottingham, PND president.

"We've built 162 of these structures. They've been through thousands of earthquakes," he said.

The steel cells won't rupture because they are interlocked, and further strengthened by concrete crossbeams, said Diana Carlson, of Integrated Concepts & Research Corp., which is managing the project for Marad.

Pilings will be used to give extra support under the cranes. And the project will include a section able to withstand earthquakes as severe as the one in 1964, according to managers.

BIG MONEY

So where are the big bucks to build the megaport coming from?

Federal earmarks secured by Young and Stevens since 2002 amount to $109 million, as of late February, Sheffield said. Another $17.5 million so far has come from port revenues. The port plans to finance $75 million with short-term debt that will be converted to long-term bonds.

Jim Lexo, chief executive officer of project manager Integrated Concepts & Research Corp., worked as an aide to Young until 1983 and managed his first five campaigns. He said he has never talked to Young about the port earmarks.

"That's something Gov. Sheffield manages all by himself," Lexo said.

Another half billion could still be needed. Young said the federal dollars will keep coming for the port.

"The earmarks are not going to go away, regardless of what you read in the paper," Young promised in a February press conference.

In the end, Sheffield said he expects the feds will pay for more than half the project. Begich wants $100 million from the state over five years. There's $10 million in the supplemental budget now being debated in Juneau.

Asked if city taxpayers would be tapped, the mayor said "not on my watch."

Neighbors are skeptical. "We may have a port ... that cannot financially support itself," said Jessal, the Government Hill Community Council president. "That's something that people far beyond our neighborhood should be concerned about."

Shavelson, of Cook Inletkeeper, has renamed the port the "Pork of Anchorage."

"It's potentially the biggest federal boondoggle in the state," he said.

Critics don't dissuade Sheffield.

"When people say it's the biggest federal boondoggle, I don't know why they say that. Maybe they beat their dogs, too," he said.

This state was built on people thinking big, he says.

"Nobody's getting rich here," Sheffield said. "We're just working to try to make it better for Alaska."

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Find Lisa Demer online at adn.com/contact/ldemer or call 257-4390.

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EXPANSION: For more on the port project, see

www.portofanchorage.org

READ AND DISCUSS: Find a comprehensive overview of the project, including construction schedule and highlights, and sound off on whether you think the expanded port is necessary.

adn.com/anchorage

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By the numbers

135 ACRES

New land being created in Knik Arm. About 3.5 times the size of the Dimond Center including its parking lots.

1.5 MILES

Length of dock when complete, the distance from the tower at Merrill Field to the 5th Avenue Mall downtown.

11 MILLION CUBIC YARDS

Amount of gravel and sand needed for fill. Around 300,000 70-ton truckloads.