On Wednesday, legislation passed through the State Legislature authorizing the Alaska Railroad Corporation (ARRC) to sell bonds to fund the replacement of its passenger dock and terminal in Seward. It now goes to the governor for approval. Pending the governor’s signature, the corporation will be able to sell up to $60 million in bonds to replace the aging dock in Seward, which is deemed as a critical connection to the thousands of cruise ship passengers who arrive in the state each summer and then go on to traverse the Kenai Peninsula, bringing tourism dollars to businesses.
ARRC President and CEO Bill O’Leary said:
“We are grateful for Senate President Peter Micciche (R) and House Transportation Committee Chair Rep. Grier Hopkins (D) for introducing and shepherding this bond authorization through the legislature. And, we are thrilled the legislature provided its resounding support for this vital project that strengthens Alaska’s cruise market in Southcentral Alaska. Now, we will get to work making this new dock and terminal a reality for the benefit of our tourism partners across the state who are ready to welcome cruise guests for decades to come.”
Because the ARRC has its own bonding powers, none of the project costs for the replacement of the dock and terminal facility will come from state dollars. Total project costs are estimated at nearly $80 million to replace the existing dock and terminal facility. Revenue bond debt will be repaid from dock user fees, according to a press release, and the remaining costs will be paid through existing dock fees and ARRC capital funds.
The project has received support from Royal Caribbean Group, considered a longtime partner of the Seward cruise ship terminal. Both groups are finalizing a multi-year agreement that features an annual revenue guarantee. Three brands under the Royal Caribbean Group brand are coming to Alaska this 2022 cruise season. They include — Royal Caribbean International, Celebrity Cruises and Silversea Cruises.
Royal Caribbean Group Regional Vice President of Government Relations for Alaska and the West Coast, Wendy Lindskoog said:
“For those cruise visitors who want to get the most out of their Alaska vacation experience, Seward is at the top of their list. Great guest experiences are inclusive of sound destination infrastructure, innovative ships, exceptional onboard service and plenty of things to see and do in the communities we visit. For many years, we have benefited from the strong community and business relationships in Seward and the Alaska Railroad Corporation’s pending improvements to the passenger dock will be critical to Seward’s continued status as a vibrant cruise transportation hub.”
With legislative approval, the ARRC is on track to invest more than $100 million into Seward over the next five years through large-scale capital projects including the passenger dock and terminal facility replacement. There is also a separate project to upgrade the freight terminal in Seward.
Seward City Manager Janette Bower added:
“The Alaska Railroad has been an excellent partner with the city and community, and we look forward to our continued partnership. We believe in this vital project and the economic benefit it provides through cruise ship tourism dollars for our local businesses, including commercial passenger vessel funds for both the city and borough, the marine industry in Seward and throughout the state.”
Under the current construction timeline, the new passenger dock will be operational for the 2024 season. The terminal facility would be operational by 2025.
