The future of the Gateway Project and mitigation of the ore basin remains uncertain, as the Alaska Industrial Development and Export Authority has declined to demolish its ship loader and asked for a revised plan.

To continue on with Gateway, the ore basin must be rid of all legacy contaminants within the soil.

Many of the toxins reside within a slope underneath the ship loader at the Ore Terminal. To rid the slope and basin of contamination, engineers say the loader must be demolished, the slope capped, and the loader later replaced.

AIDEA owns the terminal and loader, and has asked that a new plan be designed, avoiding the demolition altogether.

In a letter issued to the US Army Corps of Engineers on Oct. 8. AIDEA stated that they will not replace the loader during their current lease, which ends in 2023.

They said the project proposed by the municipality threatens the use and operation of the Skagway Ore Terminal.

Currently, AIDEA leases to Minto Explorations Ltd., Capstone Mining North Ltd. and Capstone Mining Corp. Skagway’s Mineral Services operates the terminal and ship loader.

“Demolition of this facility would make it absolutely impossible to operate the [Skagway Ore Terminal,]” the letter said.

It goes on to say demolition would also cause economic harm to AIDEA, the users, MSI and their employees, vendors and clients.

In an interview, AIDEA Director of Project Development and Asset Management Jim Hemsath said AIDEA has not received much conversation from the municipality.

“We try to keep informed about what’s going on. We listen in on Port Commission meetings, so we have an idea,” Hemsath said. “There has been no direct communication with AIDEA related to Gateway.”

The letter states that the current loader meets all of the needs of the Ore Terminal and its tenants, and as such, they see no reason to demolish it.

New designs do not show a new loader at all, which Hemsath said would need to be built prior to the demolition so as not to affect business.

But as per the plan, AIDEA has seen no plans for a new loader, which Hemsath said would be in the ballpark of $10 million to $15 million.

Issue also lies in the excavated soil itself, 17,300 cubic yards of contaminated sediment that would either be shipped out of state, or treated on-site. Four potential locations have been outlined for the treatment, one of which lies on land currently leased by AIDEA.

“AIDEA has not authorized the [Municipality of Skagway] or any other party to use its land for stockpiling or treating hazardous waste. AIDEA is very concerned that the activities associated with stockpiling and treating hazardous waste are incompatible with use of the [Skagway Ore Terminal] by AIDEA, the users and MSI, and could potentially violate the institutional controls established for a remediated area,” the letter said.

The said remediated area is a grassy slope next to the terminal, which is currently capped with grass to contain contamination. Should that grass be disturbed, Hemsath said the contamination could possibly increase.

As they do not have answers to their questions and concerns, they have asked for a redesign of the plan, avoiding the demolition of the ship loader and the stockpiling of contaminants on their leased area.

Until their lease ends in 2023, AIDEA said they will ensure all operations continue.

“As always, AIDEA is willing to work with the municipality in any reasonable way so it may achieve its goals, but under this current plan, demolishing the ship loader and shutting down the Ore Terminal is not possible until after March 2023,” the letter said.

The White Pass and Yukon Route, which subleases the land to AIDEA, has also requested details of the plan, but has somewhat agreed to cooperate.

Borough Manager Scott Hahn wrote to White Pass on Oct. 23, addressing the contaminated basin and the need to remediate it.

Hahn emphasized the project’s urgency, stating that the state-funding package of $10 million garnered for the project will expire at the end of 2015.

WP&YR President Jon Finlayson issued a vague but promising response.

In a Nov. 4 letter to the municipality, Finlayson said White Pass is “most assuredly interested in cooperating and being of assistance.”

However, he said they need to know what they are cooperating with.

“We would like a detailed description of what the Gateway Project entails, as well as the complete engineering drawings and surveys of the project,” the letter said.

[quote_right]”“We would like a detailed description of what the Gateway Project entails, as well as the complete engineering drawings and surveys of the project,” the letter said.[/quote_right]

Finlayson also said that White Pass will need a level of protection in place so that they, and the affected community, will not suffer a business interruption while the project is underway.

Port Commission Chair Tim Bourcy addressed the borough assembly on Nov. 5, also seeking direction on the project.

“We still have a working port. No harm, no foul. Nothing has really changed, but what is Gateway?” Bourcy asked.

Bourcy said a main concern for Port Commission was the loss of a floating dock, which was one component of the project. Under the recently rejected new lease by voters, the cost of the dock would have been shared with White Pass.

To help alleviate the cost, the municipality applied for a $10 million Transportation Investment Generating Economic Recovery, or TIGER grant, earlier this year, but lost in the very competitive process.

Out of 625 applications, totaling $9.8 billion in requested grant money, only 39 applications were awarded and only $500 million dispersed. The only project awarded in the State of Alaska was to the native village of Point Hope for their transportation infrastructure and transit improvement project equaling $2.9 million.

Not only did the municipality lose the $10 million, but an extra $10 million in matching funds from the commercial passenger vessel excise tax fund, which would have been designated toward the project had the grant been awarded.

“The reality for me, is projects like this, especially with the scope and scale of what it is, require funding. We have digressed significantly in the funding perspective,” Bourcy said.

Overall, Bourcy said he is concerned for Skagway’s future. He said the environment is growing increasingly competitive, with Icy Strait completing a brand new floating dock facility, Haines offering a 50 percent reduction in docking fees, and Juneau installing additional infrastructure.

“These are ports that truly affect our dockage,” he said. “It’s imperative that the municipality maintain its market dominance.”

Bourcy said the commission is at the will of the assembly, ready to do whatever is asked of them. But he urged the assembly to be proactive, as the project’s future has significant ramifications for the entire community.

The assembly is scheduled to meet with Project Manager Chad Gubala today at 4 p.m. in Assembly Chambers to discuss the future of the project.

“The project as you look at it today, with 60 percent of the drawings, is not a reality, and it’s not going to happen,” Bourcy said. “Where do we go from here?”