New developer seeks to conquer Hatcher Pass

Frank Ameduri/Managing editor

Memories slide down from the mountain into the communities below every day -- sometimes on a cool breeze and sometimes in a thunderous avalanche. They're memories of a rugged mining community and Matanuska winters the likes of which we'll never know again. They're memories of colonist families trudging up her summer slopes, buckets overflowing with blueberries -- and perhaps a breathless dip in one of her alpine lakes. They're also memories of Valley families ascending snow-covered inclines and skiing back down. In the 1960s there was even a rope tow, and eventually a T-bar lift, operated on a small budget by local families. For as long as people have lived in the Matanuska Valley, Hatcher pass has been their favorite playground. To many, the definition of life here can best be expressed in the view of the Valley from the pass.

One more time

On Thursday night a team of people from JL Properties, Inc. and their associates delivered a presentation to the Mat-Su Borough Assembly. To anyone who has lived in the Valley for any length of time, it might have seemed like one of those memories. Longtime Valley residents have seen this kind of presentation before. It was a conceptual outline of the most recent proposal for development of a ski area on Hatcher Pass. There were several picture boards; assembly and audience members sat quietly as engineers and planners explained each one.

Co-owner of JL Leonard Hyde led the team of presenters. "We are really excited about this project," Hyde said. "We see it as a once in a lifetime opportunity to do a really special project."

A series of presenters from Lounsbery & Associates, Dowl Engineering, Land Design North, HDR Alaska and other firms took turns explaining some of the conceptual plans that will contribute to that special project. The overall picture was of a multi-faceted regional resort area that would combine Alpine and Nordic skiing, multi-use trails, residential development and commercial properties in an integrated recreational community.

Part of the reason for that integrated approach, according to Hyde, is that the Alpine ski as a stand-alone venue would not be economically viable, but that it was central to the borough's vision.

"We started from the premise that an Alpine ski area was a necessary part of this development; that was stressed by the borough," Hyde said. "We understood that, particularly given the lack of buildable real estate at the base of the Alpine area that we were going to have to do what ski resort developers do." That meant developing residential real estate that would be profitable enough to subsidize the ski area, according to Hyde. "We had to find a profit center to try to help carry the Alpine area."

That came as no surprise to assembly members.

"Do any of the existing ski areas support themselves?" asked Assembly Member Mary Kvalheim. "No they don't. They're all subsidized."

"Every time the economics have been studied," said assembly member Jim Colver, "we've found you can't retire the debt for a ski area with revenues generated by the ski area alone."

A report completed by Economics Research Associates in April of 2002 was the most recent economic study to support that notion. That report was an update to a 1995 study, and it did produce some optimistic findings. The 2002 findings stated that the market had significantly improved since '95, and that a regionally-based ski area was a viable option. It was clear that a comprehensive development, including revenue-generating elements was needed, however.

A community outdoors

The vision for JL's development applies an old model to a new concept. The residential areas, according to Jim Sawhill from Lounsbery & Associates, are being designed so that the maximum amount of lots will back onto open areas and the extensive Nordic trail system. Sawhill said about 68 percent of the residential area could be open space, and that essential everyone in the community would have access to the recreational trails. Hyde said he hopes that will add value and appeal to the homes in the same way a residential golf course does in warmer climates.

"It's an untested idea," Hyde said, "but we hope that will be the outcome."

Virtually the entire residential area is being designed to have access to an extensive trail system that will include Nordic trails, multi-use trails, motorized trails and even equestrian areas. In the midst of that trail system there are even plans for a sledding area. The people living in the ski community will have access to the entire mountain, according to Hyde. The plan, he said, strives to be as inclusive as possible, but it does try to reduce the conflicts between different users.

"The motorized trails within this development all run along the connector roads and they basically lead you out of the development," Hyde said. "Our view was if we didn't plan for a way for a snowmachine rider to get out into areas where they can ride appropriately, they would do it anyway. So our view is, let's recognize that it's going to happen and provide an organized way for that to happen and minimize the impact on non-motorized users."

The trail system was designed by Bill Spencer, an engineer for HDR Alaska, and a former Olympic skier. He said some of the core of the Nordic system will be a competitive area suitable for high school racing through international competition. He also said he designed the system so novice and intermediate skiers could avoid some of the more challenging portions of the trail. The size of the system he said is similar to the one used in Salt Lake City. There is also a stadium area planned, he said, as well as a narrower system of trails for recreational skiers. He also designed hiking trails to access some of the higher elevations for activities such as berry picking, sight seeing and paragliding.

At the entrance to the community JL plans a village that will serve as a retail center. That village is planned along the Little Susitna River where there is plenty of buildable land and access to Hatcher Pass Road, according to Hyde.

What about the environment?

One of the longtime concerns over development on Hatcher Pass has been the environment. Hatcher Pass is the primary watershed for the Valley, and there have long been concerns about the water table, the beauty of the area and the loss of what many have considered to be the scenic jewel of the Mat-Su.

"When we look at this site, we wouldn't want to be involved with a development that was less than respectful of what's going on there," Hyde said. "When you look at the plans, I think most people would say there's been a considerable effort to make this development environmentally friendly."

Sawhill said the residential areas were designed after extensive studies of the terrain and habitat. He said the plan was devised to make use of naturally-open areas. "We wanted to build homes in areas where there are natural meadows and clearings rather than clear cut trees," Sawhill said. He also said there would be extensive covenants and codes to limit light and to reduce the impact to the general look of the mountain. "We don't want people to look up and see giant homes on the mountain," he said. "We want them to see forest."

The soil studies provided by the borough, and subsequent studies performed by JL look promising for water and sewer, Hyde said. The plan calls for onsite wells and septic, and Hyde said he's confident there's suitable soil to make that work.

"We realize that there are areas where that won't work," Hyde said, "and we'll redesign our lots to accommodate that as we discover those areas." He said JL will test every lot and that lots that aren't suitable for wells or septic will either be absorbed into other lots or simply left as additional open space.

"We also think that's good business in this context," Hyde said. "If you look at the target market for our lots, we think, in order to get the premium that we need to make the project viable, we're going to have to make it an environmentally-friendly atmosphere."

Will it work this time?

Mat-Su residents have been over this terrain before, and they've seen one proposal after another become snowed under for a variety of reasons. In the 1980s, when the Department of Natural Resources controlled the lease on Hatcher Pass, the Japanese giant, Mitsui Co. won a contract to develop a four-season resort, complete with quad lifts, lighted runs, a day lodge, hotel and convention center, retail stores, high-density housing, equestrian trails and a golf course. Mitsui's vision was to turn the area into a major resort destination for American and Japanese tourists and conventioneers.

It became clear that the resort would not be able to attract enough users to be economically viable, however, and that deal fell apart. It was the most ambitious plan in a series of failed development concepts. Big plans followed by disappointing realizations has become a familiar theme when it comes to Hatcher Pass development.

So what's different now? Much of it has to do with a more complete infrastructure system, more available data and a more conducive government process, according to Hyde.

"The borough has simplified and streamlined the process with the work they've done with respect to land status," Hyde said. The borough now owns the lease to the land.

"The power infrastructure is better," Hyde said. "The Valley has a larger population base now, as does all of Southcentral Alaska. The borough was also able to provide us a a significant amount of baseline data on soils. We're clearly coming in with some advantages that others didn't have."

Hyde said JL also has a clearer focus with an eye toward quality but also with a plan for economic viability. JL, according to Hyde, also has the economic resources to realize it's plan. That plan, according to Hyde, is also more realistic than previous concepts.

"We're trying to stay away from Grandiose ideas," Hyde said. "We're starting out with a high quality, but we're looking at a limited, locally-focused ski area. Mitsui envisioned a really grand development that we thought was too comprehensive for this market at this time." He said the JL plan is to start on a more modest basis, but to construct an infrastructure that would allow for easy future growth.

Part of that plan is to install a detachable, high-speed quad lift right from the start. That would mean an immediate capacity of up to 2,400 skiers up the hill per hour, and would also be flexible for future growth.

Another important part of the concept, Hyde said, is that the venues will be designed to accommodate skiers of all ranges. A beginners hill at the bottom will feature a "magic carpet" conveyor belt to propel beginners to the top of the bunny hill, the quad lift will handle traffic up the middle part of the mountain and a T-bar lift will provide access to the top of the mountain. It's ambitious, but not over the top, he said.

"I don't think they're going overboard," Colver said. "I'm very optimistic that this time the dream of a ski area is going to become a reality. I'm ready to go to work on it."

Too good to be true?

Hyde was quick to point out that the plan presented Thursday was simply a progress report, and that it's very conceptual.

"I don't want to leave the impression that this is going to be easy," Hyde said. "Clearly there are some financial challenges with what we've proposed. We have done a lot of work, and there's a significant amount of work yet to be done to produce an economically viable project."

It's the economics that are yet to be worked out, and JL plans to present their comprehensive plan to the assembly in early February. For at least some assembly members the jury is still out until that time.

"I'm not really sold on this," Kvalheim said. "We're going to need money for schools, firehouses, equipment and other things. Is this going to be another subsidy for the borough? I want to know that there's a way we can do this and get nothing but revenue."

Borough Mayor Tim Anderson said he was impressed with JL's presentation, and that he's optimistic about the potential, but he also acknowledged that economics are going to be the critical factor. He said he's anxious to see the comprehensive plan in February.

"That's where the rubber is going to hit the road," Anderson said. "My one concern is that [the borough] doesn't want to own and run a ski resort. We'd help with parts of the community, just like other places. Providing the basic infrastructure is our role."

Still, Anderson sees good potential for revenue.

"We're going to get an increased tax base," Anderson said. "All of the residential improvements are taxable. Secondly, the economy will benefit. We'll have a nice place for people to live. They'll spend their money here. It will create jobs. It will attract tourism."

Anderson said he's very interested in seeing convention and lodging services become part of the plan, and he believes the Valley could become an attractive place for business and recreation for Anchorage.

So far the plan is little more than conceptual, though, and none of the difficult questions will be answered until JL returns in February to lay out the details, including an extensive economic plan. That's when the relationship between JL and the borough will begin to take shape.

"We have a number of ideas on how the relationship between us and the borough could work," Hyde said, "but pending discussions with borough officials and the assembly, I'm not going to put any ideas out on the table."

The one number that is on the table is an estimated price tag of $35- to $45-million. That doesn't include residential construction or other buildings, Hyde said. When JL brings a more firm number to the table in February, the discussions will begin in earnest.

At that time the assembly and the people of Mat-Su will decide whether or not it's finally time to write a new chapter on the slopes of Hatcher Pass.