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DOT racks up storage costs for steel purchased prematurely for Juneau road

  • Author: Pat Forgey
  • Updated: September 28, 2016
  • Published February 27, 2015

JUNEAU -- Sitting in a storage yard in Seattle are $8.2 million worth of steel bridge pilings purchased by the state of Alaska three governors ago. By just sitting there, they continue to cost the state money.

The pilings, ranging from 24 to 48 inches in diameter, were originally intended for some of the eight bridges along a new road out of Juneau. They've been sitting in leased storage space as state finances have risen and fallen, but now, with budget deficits in the billions, their $4,000-a-month storage cost is raising concerns.

"It's been almost a decade we've been paying rent on these things," said Emily Ferry, a Juneau activist who has worked with the Southeast Alaska Conservation Council and on her own to oppose the road that the pilings were intended to be used on.

She wants what's formally called the Juneau Access Improvement Project scrapped, saving both the cost and the environmental impact.

Department of Transportation and Public Facilities spokesman Jeremy Woodrow confirms Ferry's cost estimates, saying that while full numbers aren't readily available the storage bill has run at least $350,000 over the years.

An additional $600,000 in culverts are stored at a state-owned yard in Juneau at no cost. But the pilings have additional costs beyond just the rent, including testing and employee time. The state now has invested $9.2 million for the pilings, Woodrow said.

Rep. Cathy Munoz, a Juneau Republican who supports the road, said the pilings may still turn out to be a good deal.

"Hasn't steel been going up in price? Today the pilings are probably worth $15 million," she said, offering what she said was a guess on inflation in the steel piling business.

"It may very well be that the storage is less than the increase in the value of the steel," she said.

Woodrow said the department doesn't track steel prices.

The pilings were bought with a legislative appropriation by former Gov. Frank Murkowski as he was trying to push the Juneau road forward, but it has faced legal and other obstacles.

Support for the Juneau road has waxed and waned under recent Alaska governors. Murkowski gave it a hard push, but it wasn't a priority for Sarah Palin, who ousted him from office in the Republican primary of 2006. Her successor, Sean Parnell, took a personal interest in it, while current Gov. Bill Walker has questioned its $574 million price tag in a time of deficits.

Munoz said she understood why Murkowski authorized the piling purchase.

"Gov. Murkowski was very supportive of moving forward, and he had a very take-charge attitude," she said. "The push was, what do we need to do to move this project forward."

The road project now has caught the eye of Rep. Matt Claman, D-Anchorage, a newly elected member of the House Transportation Committee.

He said he's less concerned about storage costs and more concerned about the entire project.

"I don't see how we can build something that is signing us up each year and every year not just for $4,000 a month but for $5 million a year," Claman said.

The state is currently reviewing a draft environmental impact statement on the Juneau road project, in which the department's preferred alternative, the road to a new ferry terminal, is estimated to have operating costs of $5 million a year, both to subsidize the ferry and keep the road open through its rugged right of way.

The new ferry terminal at the end of the road would connect to Haines and Skagway, coastal cities with continental highway links.

Claman said the state should sell the pilings and move on.

"I don't think we get anything by criticism," he said. "The last administration may not have been aware that they had these pilings to sell, but if it's true we have a bunch of pilings down in Seattle, we ought to sell them."

But Munoz said the current budget situation shows why the road project is needed.

"We're looking at major cuts to the Lynn Canal service area in the Marine Highway budget. I think it is as important as ever," she said.

Emily Ferry also wants the pilings sold and the project scrapped.

"The best case would be to shut the project now, sell the $9 million in pilings and get that rent taken off the books," she said.

The department is currently planning to complete environmental studies, finishing with what's known as a record of decision in about a year. At that point, said Commissioner Marc Luiken, the department will have the information it needs to decide whether the state should move forward or scrap the project.

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