DNR proposes 10-year lease for Palmer hydro plant that ran five years unauthorized

A 240-kilowatt hydroelectric plant on McRoberts Creek east of Palmer has operated on state land for more than five years without authorization, and the state now proposes to legalize it with a 10-year lease over 1.61 acres and a private easement over about 5.85 acres more. Written comments close at 11:59 p.m. on Oct. 15, and go to Lyncoln Standley at the Southcentral Regional Land Office, 550 W. 7th Ave., Suite 900C, Anchorage, or [email protected]; questions go to (907) 269-8619.

Only people who comment can contest the outcome. "To be eligible to appeal, a person affected by the FFD must provide written comments during the public comment period," the Southcentral Regional Land Office wrote in the preliminary decision, referring to the final finding and decision.

It ran under a 15-year private easement issued in June 1991 and extended in 2007 to expire on June 20, 2021. The Division of Mining, Land and Water, writing in its decision on the borough's conveyance of the surrounding section, says the intake, penstock, powerhouse, buried transmission line and access trail "remains on state land without an active authorization." The penstock is the pipe that carries creek water down to the turbine. The department asked the administrator of the late easement holder's estate, Cliff Buswell, to file applications on Feb. 20, 2026, four years and eight months after the lapse.

The applicant's development plan describes the plant in the present tense. "Power is delivered through a grid connection to the local utility via a single-phase 7200-volt medium voltage line," it says, and names Matanuska Electric Association as the buyer. Two to three part-time employees handle maintenance. Rent would be a minimum of $1,000 a year. The land office records that the minimum rent determination it requested from its appraisals section on July 17 "has not been received at the time of this decision." A $6,000 performance guaranty would secure site restoration within 120 days of termination.

The site sits in land classified Wildlife Habitat Land and Public Recreation Land under the 2011 Susitna Matanuska Area Plan, in terrain where moose winter and calve. The department found the lease consistent with that plan by reasoning from an absence, writing that the Alaska Department of Fish and Game "was consulted, and they did not suggest that a permit would be necessary for the proposed hydro facility."

In the same document, Fish and Game's Habitat Section requested permission on July 4 "to utilize the trails/easement to access McRoberts Creek above the intake (near 61.6036N, 148.9664W), and below the powerhouse to sample for fish species presence." The land office replied that the applicant may grant access "for the 2027 sampling season," a year after the lease would issue. The Habitat Section also asked that any equipment use of the access road not block the existing parking lot and trail system that hikers rely on to reach the area. McRoberts Creek is listed in the Anadromous Waters Catalog, the state's register of waters used by salmon, and a 2014 Mat-Su fish habitat report documents sockeye and coho in the drainage and a popular coho fishery. The diverted reach lies above the catalog's documented anadromous extent, and water returns at the powerhouse.

Who administers the lease is already set to change. The Matanuska-Susitna Borough applied on Dec. 15, 2025, for conveyance of all 631.72 acres of the section, planning a larger Matanuska Peak Trail trailhead with gravel parking for 40 vehicles. Comment closed June 10, and Commissioner John Crowther approved the conveyance on July 14. The hydro decision states that administration of the lease would transfer to the borough once the conveyance is complete.