Mat-Su projects prominent in state budget

The Legislature adjourned its regular session late Wednesday and began a special session Thursday morning. While Gov. Mike Dunleavy listed his Permanent Fund proposals on the special session agenda what lawmakers are really focused on now is completing next year’s state budget, which was still unfinished on Wednesday.

Finishing the budget, which will likely include a Permanent Fund Dividend, is expected to take several days.

The governor’s other proposals, which include putting the PFD into the state constitution, will likely be taken up in August in a second special session called by Dunleavy.

Although the final budget bill isn’t yet law there are several items of interest in the Mat-Su that are now agreed, although nothing is ever final until legislators “gavel out” and leave Juneau, and the governor signs the budget.

Here are few things of interest:

An early proposal for several construction projects to be funded by a state general obligation bonds is now off the table. Many of the projects that were to be financed with borrowed money, through the bonds, will now be paid for in cash.

One of regional interest is $53.6 million for Knik-Goose Bay road reconstruction; a second is $9 million to replace Houston Middle School, which was heavily damaged in the 2018 earthquake. Another is an $8.5 million appropriation to speed work on the proposed West Susitna Access Project, a 100-mile road to be built into undeveloped western parts of the Matanuska-Susitna Borough.

Work on the road is being led by the Alaska Industrial Development and Export Authority, or AIDEA, the state development finance corporation. AIDEA and Nova Minerals, Ltd., a mining company, are splitting this year’s costs for road planning. If the Legislature’s appropriation comes through it will be an add-on to the state‘s contribution.

The new funding from the state would allocate $4 million for an all-weather bridge across the Little Susitna River and a winter snow road along the right-of-way that the borough can use to reach lands for fire control purposes.

The balance of the new state money would support permit work to get the project ready for a federal Environmental Impact Statement application planned for February 2022, Alan Wietzner, AIDEA’s executive director, told the Senate Finance Committee.

AIDEA’s goal is to have the EIS completed and a federal Record of Decision approving federal permits by early 2024.

The Mat-Su Borough is a partner in the planning but is not currently contributing funds. Nova Minerals is exploring a potential gold mine in the Yentna Mining District at the end of the planned road. Although Nova Minerals would benefit from the road, and pay tolls for its use, the borough sees the road as a strategic transportation link in opening access to borough-owned lands west of the Susitna River.

One other item in the budget of regional interest is $10 million appropriated to the Mat-Su Borough for road rehabilitation and repaving. Although this is mainly intended for borough roads some state-owned roads in the MatSu are included in the planned rehab.

Another strategic transportation initiative proposed for the budget is $7.5 million in additional state money for the Ambler Access Project, a planned 211-mile resource industrial road in the western Brooks Range. This is another project being led by AIDEA in a partnership with a mining company, in this case Ambler Metals, a joint-venture of Australia-based South 32 Ltd., a major mining company, and Trilogy Metals LLC, a Canada-based “junior”mining exploration company.

The state administration had proposed the funding to the Senate and House Finance Committees but it has not yet been included in the budget. There are still differences between the House and Senate on the budget that will be worked out in a budget conference committee.

The money would used to identify material sites on sections of the road built through Native-owned lands, Weitzner, of AIDEA, told legislators. Permitting is also underway for the road, which would extend from the Dalton Highway in the central Brooks Range to the Ambler Mining District in the west.

Ambler Mining is at an advanced exploration stage with Arctic, a high-grade copper discovery. If developed, the mine could be an anchor customer for AIDEA, which would own the road and charge fees for its use.