Legislature OKs Longer AK Railroad Land Leases
HB 314 gives ARR option to give 95 year leases to businesses,
promotes long-term development and high-value buildings
Sunday, April 15, 2012, Juneau, Alaska – Businesses on Alaska Railroad Corporation land, or prospective tenants, are one step closer to securing an incentive to invest in building improvements or construction thanks to a bill that passed the Alaska Legislature today.
House Bill 314, sponsored by the House Labor & Commerce Committee, grants the Railroad the option to extend property lease terms from 55 to 95 years. Rep. Kurt Olson, the L&C Committee Chair, said legislators have heard from tenants or prospective tenants that it’s oftentimes hard to secure construction loans from lenders because the timetable for their leases isn’t long enough to invest in high-value construction or improvements.
“It comes down to planning,” Olson, R-Kenai, said. “Longer leases encourage high-value building construction. Quality developments retain their value for a longer period of time, and have a higher resale value. This is a win for the railroad, the state and for leaseholders.”
The Municipality of Anchorage, the cities of Valdez, Seward and Whittier, as well as various leaseholders and developers throughout the Railbelt region support the bill.
HB 314 will now be transmitted to the governor for his signature and would take effect immediately.
Posted: April 15, 2012