State approves giving AIDEA 6,800 acres near Houston, a third of what it first proposed

The state will give about 6,800 acres of public land north of Houston to the Alaska Industrial Development and Export Authority at no cost, under a decision Natural Resources Commissioner John Crowther signed Tuesday. That's about a third of the nearly 20,000 acres the Department of Natural Resources proposed in July.

The department received more than 2,300 public comments, many opposing the transfer, and redrew the parcel in response, according to its final decision. It cut out the Haessler-Norris trail system, most areas planned for timber and firewood sales, and wildlife corridors that run east toward the Talkeetna Mountains.

The state also reversed course on a key safeguard. In July, DNR proposed giving up its right to take the land back. Now the land will return to the state if AIDEA doesn't develop it as described in its plan. That "ensures that state land is not indefinitely removed from public ownership without achieving the stated development objectives," the decision says.

What AIDEA will build there is still unknown. The authority's application describes a multi-use industrial and energy district and lists data centers, manufacturing, gravel extraction, utility corridors and workforce housing among possible uses. No project or tenant has been named. "The conveyance does not approve any specific development project," DNR wrote. Any development would still need permits and would be subject to Mat-Su Borough zoning and platting.

The decision lands less than a month before a new governor takes office Dec. 7. Crowther told senators in October that the governor's office worked "very closely" with his department on the transfer, and that a final decision could come before the change in administrations.

The Houston City Council and the Mat-Su Borough Assembly both voted against the larger transfer. Legislative attorneys told lawmakers in October that it might fail the public-purpose test in the Alaska Constitution, which bars transferring public property except for a public purpose. Among the objections the Senate Resources Committee raised, backed by those attorneys' memo, was that the state planned to give up its right to take the land back.

DNR's answer, in the final decision, is that AIDEA is a state agency the Legislature created to pursue projects in the public interest, and that the added conditions and reversion clause keep the land tied to that purpose. The department acknowledged that its July decision "may have confusingly explained" how two state land laws applied. The decision "may be subject to judicial review," DNR wrote, "but DNR, the agency statutorily directed to manage state lands, has determined this conveyance complies with Alaska law."

The area is used for hunting, fishing, trapping, dog mushing, snowmachining, firewood cutting and hiking, the department said. Commenters told DNR that even with legal easements, trails would lose their value if the land around them were industrialized.

DNR said it removed established trails and key access routes from the parcel "where feasible." The transfer will remain subject to an existing public trail easement that crosses it, and the department said it would finish reviewing a forestry division application for a public easement along Zero Lake Road, the gravel road off the Parks Highway that leads into the area. AIDEA intends to keep allowing some public access until the land is formally transferred, but it will decide which activities are allowed, according to the decision.

AIDEA won't pay for the land, though it must pay for a survey. It has 10 years to survey the parcel and finish the paperwork, or the approval expires. The decision doesn't set a deadline for developing the land.

The parcel begins about two miles north of Houston, which in October paused data center permits within city limits for two years. On Monday, AIDEA launched InvestNorth, a platform it says will eventually let Alaskans invest in data centers and other projects. It hasn't announced a project.

Only people who submitted timely written comments or hearing testimony can ask DNR to reconsider. Requests are due within 20 days of the decision, by Nov. 30, with a $200 fee. Reconsideration is required before anyone can challenge the decision in court.