UPDATE: After this paper went to print, the official results were posted at City Hall on Oct. 8. The outcome remained the same, with the Tidelands lease failing 383 to 167. Read about the election results here.

After five years of negotiations, months of citizens’ frustrations and days of social media campaigns, the anticipated Tidelands lease between the Municipality of Skagway and the White Pass and Yukon Route railway was sent to the voters, and it failed miserably.

Though approximately 144 absentee ballots have yet to be counted, the results from Tuesday’s election are telling of the official results – the lease failed with 278 voters against and 136 in favor.

“We are pretty close to being back to square one,” Borough Manager Scott Hahn said. “Because we don’t have a clue why people voted the way they did- why they turned it down. What would make 400 people happy in a future lease?”

Assemblyman Steve Burnham Jr., who was a member of the negotiating team along with Assemblyman Dan Henry and Borough Attorney Bob Blasco, said he isn’t surprised that the lease didn’t pass.

“I don’t think the municipality was able to adequately inform the public about what they were voting on,” he said, adding that they did provide the most accurate information possible.

“We were not prepared for the backlash that resulted,” he said.

With the failure of the lease, the future of the Gateway Project remains uncertain, as site control has not been established. But Project Manager Chad Gubala said he continues moving forward.

“As of right now, KPFF will continue working on designs. Neither the assembly or Port Commission has given me instruction to stop the process,” he said.

[quote_right]“As of right now, KPFF will continue working on designs. Neither the assembly or Port Commission has given me instruction to stop the process,” he said.[/quote_right]

Had the lease passed, the municipality would have regained much of the waterfront, and White Pass would have leased only the land directly below the docks.

White Pass would have paid $2 million toward a $4.5 million remediation project and would have indemnified the municipality of any past or future contamination should more be found. Now, the project and the remediation are uncertain.

But Gubala is continuing with the licensing of the project, and meeting with the Army Corps of Engineers and the US Environmental Protection Agency to discuss the current situation.

“The MOU that allowed us access to the property expired at the time that the referendum was put forward,” he said. “We have the ability to continue getting the project approved for regulatory, but we have to open up a dialogue with White Pass beyond this. It will be up to assembly to determine how or when they want to do that.”

As for the mitigation of the harbor, Gubala said regulators could enforce a clean up with a compliance order against responsible parties.

“I think we would all be hard pressed to put the mitigation genie back in the bottle at this point,” he said. “The material is down there and needs to be dealt with.”

Because the municipality has been diligent toward conducting the mitigation, Gubala said MOS has a good track record and will hopefully not be held responsible should an agreement not be reached.

“The conditions for executing the project, the reasons for doing it are all still there. It’s still in White Pass’s and in the municipality’s interest to actually execute that,” he said.

Earlier this summer, the municipality submitted an application for a Transportation Investment Generating Economic Recovery grant to help fund a floating dock in connection with the project.

Though the lease has failed, Gubala said the grant might still be awarded to the MOS.

“Life goes on beyond this thing. This was a vote regarding a specific lease extension, but that doesn’t mean that the municipality and White Pass can’t or won’t partner up on municipal projects carrying forward,” he said.

So what now? Hahn said if White Pass agrees to continue with future negotiations, the assembly needs to poll voters to find out what they want.

He said the public perception of corporations or big businesses making big money is a negative thing, adding that people can make anonymous jabs and spread misinformation.

“Clearly, we didn’t have 400 people show up at the meetings. Clearly it was rumors of word of mouth and maybe word of social media, which is not a good place to learn,” he said.

Assemblyman Henry said  he would not expect White Pass to be willing to renegotiate any time soon.

“I would not be very optimistic to knock on White Pass’s door and expect anything other than a cool response,” he said. “We went to White Pass. They didn’t come to us asking for a new lease.”

Mayor Mark Schaefer said he respected the decision of the voters, and hopes to figure out what they want in the future.

“I still want to carry on [with] a post election survey so we can try to figure it out. A no vote doesn’t tell us enough,” he said.

If both parties agree to renegotiate, Assemblyman Burnham said he hopes the municipality will hire a professional negotiator with experience in representing municipalities.

“I believe the negotiating team represented what the assembly had requested. I think we were generally successful in our task,” he said. “However, considering the public outcry, I don’t think anyone on the assembly should directly bargain with the railroad.”

But first and foremost, Burnham hopes to hire a third party of surveyors to better understand the intent of the voters.

“I certainly don’t think negotiations should commence immediately, and possibly not ever,” he said. “We will need to plot a course for the port, and it needs one that the community supports and understands.”

White Pass officials could not be reached for comment as all spokespersons were traveling.

The current lease ends in 2023.