By Margaret Bauman
Alaska Journal of Commerce

Debate continues over the economic viability of the proposed Knik Arm Bridge, with proponents defending the public-private partnership concept, and opponents saying it just won't fly.

A new report written by Lois Epstein, an engineer and director of the Alaska Transportation Priorities Project, says such a project would be a high-risk undertaking for the private sector.

Henry Springer, executive director of the Knik Arm Bridge and Toll Authority, says skepticism is healthy, but a public-private partnership is a valid method to see the project to fruition.

March 13 will be a day of reckoning for both sides, as KABATA finds out who is interested in being a potential private sector partner to build a bridge connecting Anchorage and the Matanuska-Susitna Borough, in exchange for collecting tolls for 55 years after the bridge is completed.

“It's like bear hunting,” Springer said. “You sit and wait to see what's going to come.”

KABATA held workshops in Anchorage Jan. 17 and in New York City Jan. 23 for potential financial, construction and related industry partners, showcasing the project as an attractive public-private partnership. KABATA's hope is to attract a number of offers from firms interested in investing about $500 million in developing, financing, constructing, operating and maintaining the bridge.

Plans are to choose three finalists from those who submit requests for qualifications and to choose the winning group by the end of December, Springer said.

The Anchorage Planning and Zoning Commission voted unanimously on Feb. 13 to recommend against amending its Long Range Transportation Plan to include the Knik Arm Crossing project. The Anchorage Assembly is scheduled to make a decision on its stand on the proposed bridge March 13.

Epstein, a licensed professional engineer, meanwhile notified interested parties on March 2 of her own findings on behalf of ATPP. The project group she works for identifies itself as a coalition of organizations, businesses and individuals who promote sensible transportation systems in Alaska, with a goal of providing safe, economic, well-maintained and environmentally appropriate transportation.

According to Epstein, the information KABATA has developed makes clear that the bridge project is a high-risk undertaking for the private sector.

The ATPP report argues that there was no independent cost estimate for the KABATA project, with a potential phase one cost of $639 million and phase two cost of $504 million, plus the potential additional cost of $25 million for each one-year delay. Epstein said those figures came from a document produced by the Federal Highway Administration, published in June 2006. “It is a more rigorous analysis of the cost numbers than anything done previously,” she said.

The report said combined guaranteed federal/state funding stands at $129 million. “Additional funds may be difficult to obtain given the notoriety of the ÔBridge to Nowhere' project at the federal level, and competing state and local transportation projects at the state and local levels, respectively,” the report said.

Meanwhile there is significant risk of cost increases from marine construction activities, disposal of excavated materials and more, according to the FHA report.

Epstein also said the federal environmental impact statement and environmental permitting processes for the bridge are not yet complete. The outcome of both these processes could result in major changes, requiring construction of an extremely high-cost 14,000-foot bridge rather than the 8,200 foot design currently preferred by KABATA, her report said.

Epstein also notes that the National Oceanic and Atmospheric Administration, in its comments on the draft environmental impact statement, expressed concern for both beluga whale and salmon populations in Cook Inlet. NOAA's National Marine Fisheries Service is currently undertaking a status review of the Cook Inlet beluga stock to determine whether this population should be listed under the Endangered Species Act. “We are concerned that the proposed project may threaten the viability and recovery of this small beluga population,” NOAA officials said.

KABATA's Springer, meanwhile, said he is taking the criticism in stride.

If Anchorage transportation officials voice specific concerns about the project as proposed, KABATA will have to come up with solutions or show them they had the wrong reasoning or data, he said. “If they tell us we have to do another study, that's one thing,” Springer said. “If they say we have to wait until the belugas recover, I say, Ôgood luck; that may be never.'”

Margaret Bauman can be reached at margie.bauman@alaskajournal.com.