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Alaska Railroad Poised to Issue Bonds to Replace Seward Passenger Dock

May 1, 2024 | News, Tourism, Transportation

The new passenger dock would include a 60,000 square foot terminal building that will accommodate cruise passengers in the summer and community use in the off season.

The Seward Company

The Alaska Railroad Corporation (ARRC) is seeking approval from the Alaska Legislature to issue bonds that would allow it to replace the existing passenger dock and terminal building in Seward. A public-private partnership called The Seward Company would build the facility, thanks to a thirty-year commitment from Royal Caribbean Group to use it.

Increased Accessibility

Royal Caribbean would help design and pay for the $137 million facility, while the Alaska Railroad would own it.

The existing dock was built in 1965 and is approaching the end of its useful lifespan. Alaska Railroad External Affairs Director Meghan Clemens says the state-owned railroad had been searching for a workable replacement and took a “strategic pause” a year ago for lack of progress. Then in January, it received a proposal from The Seward Company to build the dock.

The Seward Company describes itself as a public-private project formed to revive, reimagine, and rebuild cruise port infrastructure in Seward. Partners include the Alaska Railroad, Royal Caribbean Group, and Turnagain Marine.

“This dock is a vital piece of Alaska’s transportation infrastructure, not just for the community of Seward, but for Alaska’s visitor industry across Southeast, Southcentral, and the Interior,” says ARRC President and CEO Bill O’Leary. “As maintenance became more challenging, it’s imperative we replace the old dock. This new, state-of-the-art infrastructure will serve Alaskans for the next fifty years.”

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The new 748-foot dock, scheduled to open in time for cruise season in 2026, will be “the most robust floating double-berth pier in Alaska,” according to the Alaska Railroad. Designed as a turn-port, the double-barge hull will feature a concrete deck with ample space for passengers to safely embark while also supporting effective provisioning. Designed for the Royal Caribbean’s Quantam-class specifications, the new facility will easily accommodate all classes of cruise vessels sailing in the Alaska market, as well as potential winter cargo shipments in coordination with ARRC’s adjacent freight dock.

“We believe it will work well for Royal Caribbean and work well for other cruise line customers, and meet the long-term needs of the Alaska Railroad,” Clemens says.

The new passenger dock will replace an outdated dock that required significant ongoing maintenance to keep operable.

The Seward Company

Last year, eighty-seven ships docked in Seward carrying 188,000 passengers. Many of these cross-gulf cruise guests extend their time in the state with shoreside excursions on the Kenai Peninsula or onward to Anchorage, the Matanuska-Susitna Borough, Denali, Fairbanks, or other destinations.

“The new Seward passenger dock is an important investment in Alaska’s long-term ability to welcome visitors to Southcentral Alaska and beyond,” says Governor Mike Dunleavy. “We’re proud that Alaska is rightfully known as a world-class destination, and our strong visitor industry is ready to continue providing incredible experiences for guests, and benefits to our local communities.”

The floating dock will raise and lower with Alaska’s extreme tides, allowing ships to berth on both sides. It will also include a 60,000-square-foot terminal building. During the winter, the workstations and dividing walls of the terminal can be moved, making the new facility the largest flex-space in the region.

“This dock is hugely important to our community,” says Seward Mayor Sue McClure. “In addition to the economic importance of bringing summer visitors to local businesses, the terminal building is used for community events over the winter months. We are excited about the revitalization of this infrastructure, and Royal Caribbean’s long-term commitment to Seward as a premier destination.”

Clemens says the dock will also accommodate side-loading ferry vessels, giving the Alaska Marine Highway System the option to return to Seward. Shore power will also be available, an important new feature to meet future regulations and objectives for low-emission solutions.

Bonding Authority

The floating dock will allow two cruise ships to be in port at once.

The Seward Company

ARRC plans to purchase the new dock and terminal facility primarily through bonding. The organization has bonding authority granted in 2022 by the legislature to issue up to $60 million in bonds when plans called for a smaller facility. Now ARRC is seeking permission from the legislature to increase that bonding amount by $75 million.

The new proposal includes an unprecedented commitment on the part of Royal Caribbean: a thirty-year contract that will effectively pay off the cost of construction over time.

“Royal Caribbean Group remains strongly committed to the future of Seward and the State of Alaska,” says Preston Carnahan, regional vice president for Royal Caribbean Group, noting that the homeport agreement will be the largest in the state of Alaska. “We are excited to continue to collaborate with the Alaska Railroad and watch as Seward energizes opportunity across Alaska.”

ARRC is awaiting approval of the bond authorization request before the close of this Legislative session. Approval will allow the developer to break ground in fall 2025 and have the new facility ready for the 2026 season.

Clemens says, “We are excited about bringing new infrastructure to Seward that will support the growth of the next fifty years of the Alaska visitor industry.”

Alaska Business Magazine July 2024 cover
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Best of Alaska Business 2024
July 2024
Welcome to the 2024 Best of Alaska Business special section! For the ninth time we invited our readers to tell us which Alaska businesses they love the most, this year in forty-four categories. Throughout the month of March, you told us who should be featured in these pages, and we're thrilled to be able to publish the results.
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