Whittier council will discuss Alaska Railroad land purchase in closed session Nov. 17

The Whittier City Council will meet behind closed doors Tuesday, Nov. 17, to discuss the city's planned purchase of about 84.8 acres of Alaska Railroad land, which an earlier railroad appraisal valued at about $4.5 million.

The special meeting begins at 6 pm. Its agenda lists two executive sessions and no public vote on the land deal. The other session, listed first, concerns the city's enforcement actions against a property owner, tied to the culvert lawsuit reported on Oct. 21.

The city has not released the price or terms of the agreement. A third-party appraisal of the Whittier land was under way in October, and its result has not been made public.

The railroad owns 109 of the 212 acres in Whittier's core, and that land is tax-exempt. According to the city's 2027-2036 capital plan, the federal government transferred the railroad and its surrounding Whittier land to the state-owned Alaska Railroad Corporation in 1985, and the land serves mainly to generate lease revenue for the railroad.

The council asked for the transfer in a July 2024 resolution. The Legislature then passed a bill authorizing the sale, which a Senate committee advanced without objection in May. It passed both chambers unanimously and became law without the governor's signature, taking effect July 3. It lets the railroad convey about 84.8 acres in five areas of Whittier to the city for fair market value, payable in cash, land of equal value or both.

The capital plan says the railroad's legal department is reviewing a draft memorandum of agreement that would set the details of the sale. The city aims to buy the land by mid-2027 and has set aside part of it for housing.

The city's draft 2027-2028 budget assumes the deal closes and spreads the $4.5 million over about five years. The first payment, $1.4 million, would come in 2028 from cruise terminal property taxes. Because of the purchase, the draft budget says, the General Fund's unassigned balance, the city's uncommitted reserve, is not expected to reach its policy level of at least nine to 12 months of spending from 2027 through 2033.

Finance Director Kristin Erchinger told the council at its Oct. 20 meeting that the city might instead borrow and pay the railroad up front.

City officials have not said whether the council will act after the closed session, or when the agreement will come up for a public vote.