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West Creek Hydro Grant App
ALASKA Renewable Energy Fund Round 5 ENERGY AUTHORITY Grant Application Application Forms and Instructions The following forms and instructions are provided to assist you in preparing your application for a Renewable Energy Fund Grant. An electronic version of the Request for Applications (RFA) and the forms are available online at: http://vvww.akenergyauthor!ty.org Grant Application GrantApp5.doc Application form in MS Word that includes an outline of Form information required to submit a complete application. Applicants should use the form to assure all information is provided and attach additional information as required. Application Cost Costworksheet Summary of Cost information that should be addressed by Worksheet 5.doc applicants in preparing their application. Grant Budget GrantBudget5. A detailed grant budget that includes a breakdown of costs by Form doc milestone and a summary of funds available and requested to complete the work for which funds are being requested. Grant Budget GrantBudgetln Instructions for completing the above grant budget form. Form Instructions structions5.doc Authorized Authorized Form indicating who is authorized to sign the grant, finance Signers Form signers reports and progress reports and provides grantee information. form5.doc • If you are applying for grants for more than one project, provide separate application forms for each project. • Multiple phases for the same project may be submitted as one application. • If you are applying for grant funding for more than one phase of a project, provide milestones and grant budget for completion of each phase. • If some work has already been completed on your project and you are requesting funding for an advanced phase, submit information sufficient to demonstrate that the preceding phases are satisfied and funding for an advanced phase is warranted. • If you have additional information or reports you would like the Authority to consider in reviewing your application, either provide an electronic version of the document with your submission or reference a web link where it can be downloaded or reviewed. REMINDER: • Alaska Energy Authority is subject to the Public Records Act AS 40.25, and materials submitted to the Authority may be subject to disclosure requirements under the act if no statutory exemptions apply. • All applications received will be posted on the Authority web site after final recommendations are made to the legislature. • In accordance with 3 AAC 107.630 (b) Applicants may request trade secrets or proprietary company data be kept confidential subject to review and approval by the Authority. If you want information is to be kept confidential the applicant must: o Request the information be kept confidential. o Clearly identify the information that is the trade secret or proprietary in their application. o Receive concurrence from the Authority that the information will be kept confidential. If the Authority determines it is not confidential it will be treated as a public record in accordance with AS 40.25 or returned to the applicant upon request. AEA 12-001 Application Page 1 of 18 7/1/2011 ®'ORITY AENELASHKA Renewable Energy Fund Grant Application Round 5 SECTION 1 — APPLICANT INFORMATION Name (Name of utility, IPP, or government entity submitting proposal) Borough and Municipality of Skagway Type of Entity: Fiscal Year End June 30 Government Tax ID # Tax Status: —For-profit or non-profit ( check one) Mailing Address Physical Address P O Box 415, Skagway, AK 99840 700 B Spring Street, Skagway, AK 99S40 Telephone Fax t.smith@,skagway.org 907-983-2297 907-983.2151 1.1 APPLICANT POINT OF CONTACT I GRANTS MANAGER Name Title Borough Manager Tom Smith Mailing Address P O Box 415, Skagway, AK 99840 Telephone Fax Email 907-983-2297 907-983-2151 t.smith@skagway.org 1.2 APPLICANT MINIMUM REQUIREMENTS Please check as appropriate. If you do not to meet the minimum applicant requirements, your application will be rejected. 1.2.1 As an Applicant, we are: (put an X in the appropriate box) An electric utility holding a certificate of public convenience and necessity under AS 42.05, or An independent power producer in accordance with 3 AAC 107.695 (a) (1), or X A local government, or A governmental entity (which includes tribal councils and housing authorities); YES 1.2.2. Attached to this application is formal approval and endorsement for its project by its board of directors, executive management, or other governing authority. If the applicant is a collaborative grouping, a formal approval from each participant's governing authority is necessary. (Indicate Yes or No in the box ) YES 1.2.3. As an applicant, we have administrative and financial management systems and follow procurement standards that comply with the standards set forth in the grant agreement. YES 1.2.4. If awarded the grant, we can comply with all terms and conditions of the attached grant form. (Any exceptions should be clearly noted and submitted with the application.) YES 1.2.5 We intend to own and operate any project that may be constructed with grant funds for the benefit of the general public. AEA12-001 Grant Application Page 2 of 18 7111/2011 1 A L A S K A Renewable Energy Fund j' fgl . ENERGY AUTHORITY Grant Application Round 5 SECTION 2 — PROJECT SUMMARY This is intended to be no more than a 1-2 page overview of your project. 2.1 Project Title — (Provide a 4 to 5 word title for your project) West Creek Hydroelectric Project 2.2 Project Location — Include the physical location of your project and name(s) of the community or communities that will benefit from your project. The West Creek Hydroelectric Project is located on West Creek approximately 7 miles west of Skagway and adjacent to the small community of Dyea. The primary purpose of the Project would be to offset diesel generation by cruise ships that dock in Skagway from May through September each year. Up to four cruise ships per day dock in Skagway for 12-15 hours and continuously operate their diesel genets to provide for onboard electricity requirements. The continuous stack emissions create a blue haze at approx. 1,500' elevation where vegetation has been noticeably affected. A secondary purpose of the project would be to provide winter energy to the local utility and to also provide winter energy to Yukon Energy in Whitehorse, Yukon Territory, Canada. The sale of energy to the cruise ships, the local utility and the Yukon Territory will provide the means to support the project once constructed and operational. 2.3 PROJECT TYPE Put X in boxes as appropriate 2.3.1 Renewable Resource Type Wind Biomass or Biofuels X Hydro, including run of river Transmission of Renewable Energy Geothermal, including Heat Pumps Small Natural Gas Heat Recovery from existing sources Hydrokinetic Solar Storage of Renewable Other (Describe) 2.3.2 Proposed Grant Funded Phase(s) for this Request (Check all that apply) Reconnaissance Design and Permitting X Feasibility Construction and Commissioning X Conceptual Design 2.4 PROJECT DESCRIPTION Provide a brief one paragraph description of your proposed project. The Municipality of Skagway (Municipality) proposes to construct the West Creek Hydroelectric Project (Project) located on West Creek, approximately 7 miles west of Skagway and adjacent to the small community of Dyea. The primary purpose of the Project would be offsetting diesel generation by cruise ships that dock in Skagway from May through September each year. Up to five cruise ships per day dock in Skagway for 12-15 hours and continuously operate their diesel plants to provide for on -board electricity consumption. The continuous stack emissions spread a AEA12-001 Grant Application Page 3 of 18 711t12011 ®ALASKA Renewable Energy Fund > ENERGY AUTHORITY Grant Application Round 5 blue haze at about the 1,500 foot elevation where vegetation has been noticeably affected. The Project will improve air quality and save vegetation in the area (there may be other unknown environmental benefits). To emphasize how serious the air quality of the area is being taken, the National Park Service, Municipality of Skagway, and Alaska Power & Telephone Company (AP&T) have a cooperative agreement to place and maintain equipment at AP&T's Dewey Lakes Hydro project site to monitor this pollution. Preliminary results of this monitoring are attached as an appendix. A secondary purpose of the Project is to provide winter energy to the local utility when they have a shortfall of hydro energy from their hydroelectric projects (2011 = Dewey Lakes Hydro, Lutak Hydro, Goat Lake Hydro, Kasidaya Creek Hydro) as well as to sell winter energy to the Yukon Territory, Canada through their generation company Yukon Energy. The Alaska Power Authority had a feasibility study conducted for the Project by R. W. Beck and Associates in 1981-82. That study focused on a development that would meet the electricity needs of Skagway and Haines rather than the nascent cruise ship industry. It recommended an installed capacity of 6.0 MW and a 20,000 acre-foot reservoir formed by a 120 feet high concrete faced rockfill dam. The proposed Project will be significantly different than proposed by Beck in that the installed capacity will be greater and the reservoir storage will also be greater. Nevertheless, the Beck study provides an excellent starting point for the proposed re- evaluation of the site, and therefore the Municipality believes that a Phase I reconnaissance study is not necessary. West Creek drains from an ice field into the Taiya River. The Municipality has already requested the Project site land from the State as Municipal Entitlement Land. Since the stream is glacial, flows are very high in the summer, which is also when the cruise ships are active. Preliminary analysis indicates that a Project with a capacity to serve one large cruise ship could be operated on a run -of -river basis. Increasing the capacity so the Project could serve two or three cruise ships is possible and a storage reservoir would be required to make the generation dependable. The costs and benefits of these capacity/storage alternatives will be a primary focus of the proposed Phase II studies. 2.5 PROJECT BENEFIT Briefly discuss the financial and public benefits that will result from this project, (such as reduced fuel costs, lower energy costs, etc.) The primary purpose of the Project is to reduce the environmental impacts of on -board diesel generation by cruise ships. The environmental benefits include: cleaner air from 1-3 cruise ships shutting down their diesel generators while in port; fewer trees and other vegetation being stressed at and above the 1500 foot elevation; and other unknown environmental and public benefits related to the reduction of greenhouse gas and particulate matter emissions. The Municipality anticipates negotiating power sales agreements with cruise lines that visit Skagway at rates that would be less than the cost of self -generating but would still cover the cost of owning and operating the Project. The Municipality may also receive some benefit from surplus power sales to the local utility (AP&T) as well as sales via a power sales agreement with Yukon Energy for energy needs in the Yukon Territory in the winter months. The financial AEA12-001 Grant Application Page 4 of 18 7/1//2011 ALASKA Renewable Energy Fund e®e ENERGY AUTHORITY Grant Application Round 5 benefits to the cruise ship industry would be from lower costs of operation. The Municipality could share the net revenues with the State so that its investment could be returned. The benefits of the Project will depend a great deal on how the construction costs are financed. The Municipality's preliminary economic analysis is based on 80% being funnded by grants from the State and, 20% being funded by the Municipality with 601/30 year municipal bonds. The cost ofpower to the cruise lines starts at 90% of the equivalent cost ofself-generation and escalates at 2.75% per year. Net revenues are split 50150 between the Municipality and the State. That financing arrangement provides a positive long-term benefit for all three parties (cruise lines, the Municipality, and the State). Other financing arrangements would provide differing results, and can be evaluated during the Phase II studies. 2.6 PROJECT BUDGET OVERVIEW Briefly discuss the amount of funds needed, the anticipated sources of funds, and the nature and source of other contributions to the project. The Municipality estimates the proposed Phase II work (Feasibility/Conceptual Design) will cost $295,000. In addition, cost estimates for Phase III and IV are shown in the table below for reference to the project's eventual total budget. The Municipality proposes to provide a match of 20% of the Phase II costs, which will be paid from the Municipality's share of tourism tax revenue. The estimated construction cost will also depend on whether a rain -of -river or storage project is selected from the Phase If studies. Preliminary estimated costs are shown in the budget summary table below; the construction costs are based on updating the costs estimated by Beck in the 1982 feasibility study: Phase Phase II Phase III Phase IV Total Ram -of -River Project AEA Grant Funds $236,000 $5,588,000 MunicipalityMatch $59,000 i $1,397,000 Total $295,000 ': $6,985,000 i $114,820,000 $127,000,000 Storage Project AEA Grant Funds $236, 000 $6, 628, 000 ManicipalityMatch $59,000 $1,657,000 Total $295,000 $8,285,000 3126,520,000 i $140,000,000 For the purposes of this grant application, the Municipality believes it prudent to only conduct a feasibility analysis and conceptual design at this time, and therefore requests thatAEA provide $236,000 in grant finding, which will all be used for Phases IL The Municipality will provide matching funding in the amozint of $59, 000. Please see the attached Grant Budget for a cost breakdown for each phase of development. AEA12-001 Grant Application Page 5 of 18 7/1//2011 ®we ALASHORITY A CK�-:J ENERGYK Renewable Energy Fund Grant Application Round 5 2.7 COST AND BENEFIT SUMARY Include a summary of grant request and your project's total costs and benefits below. Grant Costs (Summary of funds requested) 2.7.1 Grant Funds Requested in this application. $236,000 2.7.2 Other Funds to be provided (Project match) $ 59,000 2.7.3 Total Grant Costs (sum of 2.7.1 and 2.7.2) $295,000 Project Costs & Benefits (Summary of total project costs including work to date and future cost estimates to get to a fully operational project) 2.7.4 Total Project Cost (Summary from Cost Worksheet $ 140,000,000.00 including estimates through construction) 2.7.5 Estimated Direct Financial Benefit (Savings) $ 268,000,000.00 2.7.6 Other Public Benefit (if you can calculate the benefit in $ 165,000,000.00 terms of dollars please provide that number here and explain how you calculated that number in your application (Section 5.) AEA12-001 Grant Application Page 6 of 18 7/1//2011 ®ALASKA Renewable Energy Fund ENERGYAUTHORITY Grant Application Round 5 SECTION 3 — PROJECT MANAGEMENT PLAN Describe who will be responsible for managing the project and provide a plan for successfully completing the project within the scope, schedule and budget proposed in the application. 3.1 Project Manager Tell us who will be managing the project for the Grantee and include contact information, a resume and references for the manager(s). If the applicant does not have a project manager indicate how you intend to solicit project management support. If the applicant expects project management assistance from AEA or another government entity, state that in this section. For the proposed Phase II work, the project manager will be Tom Smith, Borough Manager, for the Municipality and Stan Selmer, Corporate Secretary ofAP&T and Outside Consultant. Both are residents of Skagway. The Phase H work will be conducted by AP&T J coordinate activities as necessary. Tom Smith, Management experience in Alaska. Mr. Selmer ha electrical generation, transmission and distribution, and operation of hydro/diesel systems. r the Municipality. Both project managers will Borough Manager has 10 years of Municipal extensive experience in project management and and hydro development, including the integration Resumes for Mr. Smith and Mr. Selmer are included in Section 9. 3.2 Project Schedule Include a schedule for the proposed work that will be funded by this grant. (You may include a chart or table attachment with a summary of dates below.) A bar schedule of the expected design and construction sequence is provided in Section 9. The following summarizes key activities and dates of the expected Project schedule. Note that this schedule is for the entire development and construction sequence; activities funded by this grant will be in Phase II only. The schedule assumes grant fumds will be authorized for expenditures by Judy 2012. Phase I. Reconnaissance —Not Required Phase H. Resource Assessment/Feasibility Analysis/Conceptual Design — July 2012 to August 2013 3.3 Project Milestones Define key tasks and decision points in your project and a schedule for achieving them. The Milestones must also be included on your budget worksheet to demonstrate how you propose to manage the project cash flow. (See Section 2 of the RFA or the Budget Form.) The key tasks and schedule for the proposed Phase II work are: • Data collection and review - - Judy 2012 —August 2012 o Site inspection - - August 2012 • Hydrology studies - - September 2012 — October 2012 • Operations model development - - October 2012 — November 2012 e Develop cost estimate spreadsheet - -November 2012— January 2013 • Develop economic analysis model - - November 2012 — January 2013 • Analysis ofproject alternatives - - November 2012 —March 2013 • Draft report —March 2013 —May 2013 • Environmental scoping— June 2013— August 2013 • Final report — October 2013 AP&T will have the Municipality and AEA in review work products such as the economic analysis model and the draft report. Key decisions by the Municipality will be: • Selection of alternatives to consider in the analvsis AEA12-001 Grant Application page 7 of 18 7/1//2011 `0 ) A L A S K A Renewable Energy Fund ® jENERGY AUTHORITY Grant Application Round 5 Range ofparameters to consider in the economic analysis Selection ofpreferred alternative far scoping based on the draft report 3.4 Project Resources Describe the personnel, contractors, equipment, and services you will use to accomplish the project. Include any partnerships or commitments with other entities you have or anticipate will be needed to complete your project. Describe any existing contracts and the selection process you may use for major equipment purchases or contracts. Include brief resumes and references for known, key personnel, contractors, and suppliers as an attachment to your application. Phase 1: Reconnaissance Not required. Phase U. Resource Assessment/Feasibility Analysis/Conceptual Design In this phase AP&T will assist the Municipality in conducting a feasibility environmental studies necessary to permit the selected Project arrangement. their respective roles will be: o Tom Smith, Borough/Municipality Project Manager • Stan Selmer, AP&T Project1lanager • Bob Berreth, Electrical Design • Ben Beste, Mechanical Design • Larry Coupe, Civil Design • Vern Neitzer, AP&T Chief Engineer • Glen Martin, Resource Assessment and Permits analysis and scoping of Key AP&T personnel and The Municipality and AP&T believe that the Project does not require licensing by the Federal Energy Regulatory Commission (FERC), since the Project will not be on Federal lands, affect interstate commerce, or be on a navigable stream. The Municipality will apply for a jurisdictional determination from FERC early in Phase II to confirm that a FERC license will not be required (takes about 6 months for this determination). Obtaining a FERC license would increase the Project cost and extend the development schedule significantly. The Beck/APA 1982 feasibility analysis will provide some basic information for reevaluation of the site, including topographic mapping geotechnical data, and environmental information. Some of the environmental information may need to be updated, and additional field work may be required. AP&T may use or has used the following contractors for the various studies: • Wetlands delineation - - HDR Alaska Inc. • Threatened and endangered plant species survey - - HDR Alaska Inc. • Fish surveys - - Ramey Associates, Inc. • Water quality sampling - - Analytica Group, Inc. e Cultural resource surveys - - Browne Research • Geotechnical investigations - - GeoEngineers, Inc. Tasks in the feasibility analysis will include: • Collection of data, maps, and reports from previous studies, generation/load data from cruise lines, cruise ship visitation records, and hourly flow data from the USGS • Site visit by AP&T engineers • Hydrology studies to develop a long-term daily flow record and hourly flows for representative years • Development of spreadsheet models for power studies, cost estimates, and economic analyses • Optimization studies of project alternatives, including number of boats to be served, amount of storage to be provided, type and diameter of power conduit, and type of transmission line • Preparation of draft reportfor review and preferred alternative selection by the Municipality AEA12-001 Grant Application Page 8 of 18 711 H2011 ®ALASKA Renewable Energy Fund Grant Application Round 5 Scoping of environmental issues and development of study plans to support permitting of the selected Project arrangement Preparation offinal feasibility report, including results of the environmental scoping. 3.5 Project Communications Discuss how you plan to monitor the project and keep the Authority informed of the status. During Phase II, the Municipality proposes to provide quarterly reports to AEA regarding the status of the work. The Municipality has provided similar reports to grant finding agencies in the past on other projects, and has established the necessary procedures for producing the report expeditiously. In addition, at the completion of Phase II, the Municipality will provide AEA with a copy of the conceptual design drawings and cost estimate. Additional funding will be pursued during Phase II for Phase III and possibly Phase IV of this project, depending on the initial results during Phase II 3.6 Project Risk Discuss potential problems and how you would address them. FERC Jurisdiction —As noted above, the Municipality and AP&T believe that FERC licensing will not be required. However, there is the risk that FERC could assert jurisdiction based on West Creek being navigable or because of proximity to the Klondike Gold Rush National Historical Park. A non - jurisdictional determination will be applied for early in Phase II. If FERC does assert jurisdiction, the Municipality will either appeal the ruling, or continue Project development under FERC jurisdiction at greater cost. Seismic — Project components will be designed appropriately for seismic activity, since the Project will be located in a moderate -risk seismic zone. Structures will be buried as much as possible to minimize seismic impacts. Landslides — In July 2002, a moraine collapse in the upper West Creek valley caused f ooding near the West Creek/Taiya River confluence. Although that type of event is unlikely to occur again, it indicates the active geologic nature of the area. During Phase II, the Municipality will have a consultant conduct a thorough review of the geologic hazards, which will be addressed in the Phase II preliminary design. AEA12-001 Grant Application Page 9 of 18 7/11/2011 ALASKA Renewable Energy Fund ® ENERGYAUTHORTY Grant Application Round 5 SECTION 4 — PROJECT DESCRIPTION AND TASKS • Tell us what the project is and how you will meet the requirements outlined in Section 2 of the RFA. • The level of information will vary according to phase(s) of the project you propose to undertake with grant funds. • If you are applying for grant funding for more than one phase of a project provide a plan and grant budget form for completion of each phase. • If some work has already been completed on your project and you are requesting funding for an advanced phase, submit information sufficient to demonstrate that the preceding phases are satisfied and funding for an advanced phase is warranted. 4.1 Proposed Energy Resource Describe the potential extent/amount of the energy resource that is available. Discuss the pros and cons of your proposed energy resource vs. other alternatives that may be available for the market to be served by your project. Proposed Energy Resource.• The optimum arrangement for the Project will be determined during the Phase II studies. The various alternatives will have varying installed capacities and annual generation capabilities. The Beck/APA 1982 study looked at alternatives varying from 6 MW & 24 GWh per year to 17 MW and 75 GWh per year. For the proposed feasibility study, the Municipality expects to evaluate capacities from 10 NIW to 25 NIW The Project is well -suited to the proposed task of supplying shore power to cruise ships docked in Skagway, since the high streamflows coincide with the tourist season. There are no other renewable resources that could provide the same amount of reliable power. AP&T is considering cevelopment of a hydroelectric project at Connelly Lake which could also be configured to provide power to cruise ships in Haines and/or Skagway, but it would have only about half the potential of the Project. Even so, AP&T and the Municipality believe there is enough cruise ship load that both the Project and Connelly Lake could be developed economically. The only real alternative to the Project is then considered to be continued diesel generation by the cruise ships. Pros: Compared to the diesel generation on the cruise ships, the Project will have the following advantages: • reduce use of diesel fiuel by cruise ships; • reduce air emissions of both CO2 and NOx gases as well as particulate matter while docked in Skagway, • reduce haze visible in and around Skagway; • reduce or eliminate impacts to vegetation in the area; • may provide other public health benefits unknown at this time; • would provide a backup energy source for the local grid; • any available winter energy could be sold to Yukon Energy Cans: As with all hydroelectric projects, the initial cost of development is much higher than for diesel generation. AEA12-001 Grant Application Page 10 of 18 7111/2011 ALASKA Renewable Energy Fund ® ENERGYAUTHORrY Grant Application Round 5 4.2 Existing Energy System 4.2.1 Basic configuration of Existing Energy System Briefly discuss the basic configuration of the existing energy system. Include information about the number, size, age, efficiency, and type of generation. AP&T serves Skagway as part of its Upper Lynn Canal (ULC) system, which includes the followine generating units: Unit Type Capacity, kW Efficiency, kYVh/gal Age, years Goat Lake Hydro (storage) 4,000 N.A. 12 Dewey Lakes Hydro (storage) 943 NA. 107 Lutak Hydro (run of river) 285 N.A. 10 10-Mile(1) Hydro (ram of river) 600 N.A. 9 Kasidaya Creek Hydro (run of river) 3,000 N.A. 3 Skagway #6 Diesel 855 14.69 21 Skagway#7 Diesel 1,100 14.80 13 Skagway #8 Diesel 500 14.89 18 Skagway #9 Diesel (refurbished) 930 ? 1 Haines #1 Diesel 800 12.64 40 Haines #2 Diesel 1265 12.93 26 Haines #3 Diesel 1600 14.92 20 Haines 114 Diesel 2865 12.83 14 (1) AP&T purchased power from Southern Energy's 10-Mile hydro project until 2002. Purchases resumed in 2008 and continue to the present. Haines and Skagway are interconnected by a 15-mile-long 34.5-kV submarine cable with a capacity of approximately 20, 000 HE. Skagway and Dyea are connected by a 7.3-mile long 7.2-kV distribution line, and Haines and the IPEC system are connected by a 10-mile long 12.47-kV distribution line. 4.2.2 Existing Energy Resources Used Briefly discuss your understanding of the existing energy resources. Include a brief discussion of any impact the project may have on existing energy infrastructure and resources. AP&T's ULC system is primarily hydroelectric generation with diesel backup. In recent years diesel has been needed for peaking operations and at the end of some long winters. AP&T is evaluating another hydroelectric project near Haines (Connelly Lake Hydro) to supplement the ULC resources to eliminate the current diesel generation. That project should also allow for significant load growth in the ULC system. The Project is intended to provide power to the cruise ships that visit Skagway each year from May through September. This project would not have an impact on the existing energy (AP&T) resources which are solely dedicated to providing power for the residential and commercial customers of ULC. The existing energy resources can in no way handle even one cruise ship at this time. The Project would not replace or share the load with any existing generating resources. The Project could provide backup renewable energyfor the ULC system in the event of an emergency, e.g. an extended outage of the Goat Lake hydro project as well as provide winter energy to Yukon Energy. 4.2.3 Existing Energy Market Discuss existing energy use and its market. Discuss impacts your project may have on energy customers. The existing enerev market would be the cruise ships that come to Skae-wav from Mav through September each year. Each large cruise ship has about a 7 MYV average load that requires continuous diesel operation while spending approximately 12-15 hours in port. During the 2011 season, between three and five cruise ships were scheduled to be in port most week days, Mondays — Fridays, with lighter numbers over weekends. The Project could be sized to handle tip to three cruise ships, which could cut emissions AEA12-001 Grant Application Page 11 of 18 711H2011 ®ALASKA ENERGY AUTHORITY Renewable Energy Fund Grant Application Round 5 by about two-thirds. The current ULC electric grid (owned and operated by AP&T) has no available or surplus renewable energy resources to supply power to these cruise ships. The Project will not affect the existing energy resources or market as this would be a new market requiring new resources. However, as explained elsewhere in this document there is a significant need to get cruise ships off of their own generation while in port due to the apparent impacts they are having on the environment. 4.3.2 Land Ownership Identify potential land ownership issues, including whether site owners have agreed to the project or how you intend to approach land ownership and access issues. The Municipality has already requested the land the Project would be situated on from the State as Municipal Entitlement Land. 4.3.3 Permits Provide the following information as it may relate to permitting and how you intend to address outstanding permit issues. • List of applicable permits • Anticipated permitting timeline • Identify and discussion of potential barriers Applicable Permits: • 404permit (Corps ofEngineers) • Water right (ADNR), e Fish habitat permit (ADF&G) • SHPO review • Municipality ofSkagway approval. • National Park Service permit, if required Permitting Timeline: Permitting is proposed to take place during the second and third years after commencement of Phase IL This schedule assumes FERC will not have jurisdiction. Potential Permitting Barriers: ADF&G may determine that water is needed in the bypassed reach of the creels (between the diversion and powerhouse tailrace) for fish habitat, if any exists, although the 1982 AEA report mentioned earlier indicates there would not be any fish use in the bypass reach. Fish studies will determine what habitat is there. If water is needed in the bypassed reach this could impact project capacity because that water could not be used for generating electricity. 4.3.4 Environmental Address whether the following environmental and land use issues apply, and if so how they will be addressed: • Threatened or Endangered species • Habitat issues • Wetlands and other protected areas • Archaeological and historical resources • Land development constraints • Telecommunications interference • Aviation considerations • Visual, aesthetics impa AEA12-001 Grant Application Page 12 of 18 7/11/2011 ®�. ALASKA Renewable Energy Fund ( .9- ENERGYAUTHOR" Grant Application Round 5 As mentioned earlier, in 1982 R. W. Beck conducted a feasibility study of this site for the AEA. In Section 9 is a copy of the Environmental Analysis of the large storage project proposed at that time. Below are comments pulled from that analysis. T&E Species: The 1982 AEA report states this site has no Federally -listed endangered or threatened species residing in it. Field studies may still be conducted for this site, but impacts to such species are not anticipated. Habitat Issues: The 1982 AEA report, with the large project proposed at that time, states that impacts of YVest Creekfow variations, possible turbidity increases, and possible temperature alterations on fish resources are expected to be minimal because West Creek contributes only 30%of the total flows of the Taiga River. Fish habitat surveys will still likely need to be conducted, but the creek has been identified by ADF&G as having Coho rearing habitat (Stream No. 115-34-10230-2009) in the lower part. There is black bear habitat that with a large reservoir would impact some of their home range. According to the 1982 AEA report, impacts to wildlife habitat in general are expected to be minimal. Wetlands: The only wetland is the creels itself. If a storage reservoir is developed, then additional wetlands will be created in the valley (the reservoir) that may benefit both avian and firrbearer species. Archaeological Resources: This project will have a SHPO review. Available information will be researched prior to hiring an archaeologist to review the site, if necessary. The Project is near the Klondike Gold Rush National Historical Park, therefore it is likely an archaeologist will have to review this site. Land Development Constraints: None known at this time. Telecommunications Interference: The 34.5 kV transmission line does not create interference with telecommunications. This size of conductor is frequently found on the same pole with telephone lines, as they are also found to coexist on AP&T's poles. For the Project, part of the transmission line is likely to be buried. Higher voltages can cause interference however. Aviation Considerations: The project does not pass by an airport and the wood poles will only be about 45 feet in height, well below any flight pattern. The ROW for the transmission line is bordered by forest on both sides and trees in the area are generally as tall as the poles or taller so that flying would be problematic regardless of transmission line. Visual, Aesthetic Impacts: Wood poles will be placed approximately 300 feet apart for the transmission line, where above ground. Part of the transmission line may be buried in conduit. Although the area is forested, which is expected to minimize visual and aesthetic impacts, the penstock corridor could be partially visible from the Klondike Gold Rush National Historical Park. The construction corridor will be kept to a minimum of clearing. Potential Barriers: None at this time. 4.4 Proposed New System Costs and Projected Revenues (Total Estimated Costs and Projected Revenues) The level of cost information provided will vary according to the phase of funding requested and any previous work the applicant may have done on the project. Applicants must reference the source of their cost data. For example: Applicants Records or Analysis, Industry Standards, Consultant or Manufacturer's estimates. 4.4.1 Project Development Cost Provide detailed project cost information based on your current knowledge and understanding of the project. Cost information should include the following: • Total anticipated project cost, and cost for this phase • Requested grant funding • Applicant matching funds — loans, capital contributions, in -kind • Identification of other funding sources cost of proposed renewable AEA12-001 Grant Application Page 13 of 18 711112011 i A L A S K A Renewable Energy Fund ® ENERGY AUTHORITY Grant Application Round 5 • Projected development cost of proposed renewable energy system Anticipated proiect costs: • Phase P $0 (reconnaissance study not required) • Phase Il: $295,000 (AP&T estimate based on AP&T experience) • Phase IIL $8,285, 000 (AP&T estimate based on AP&T experience) • Phase IV.• $131,420, 000 (AP&T estimate based on AP&T experience) • Total: $140,000,000 Requested grant funding: Applicant matchine funds. - Other sourcesoffimdinQ: N/A $236,000 (for Phase II only) $59,000 Protected capital cost: $126,520, 000 (capital cost is assumed to be the cost of Phase IV— Construction) Projected development cost: $8,580, 000 (development cost is assumed to be the total cost of Phases II and III) 4.4.2 Project Operating and Maintenance Costs Include anticipated O&M costs for new facilities constructed and how these would be funded by the applicant. (Note: Operational costs are not eligible for grant funds however grantees are required to meet ongoing reporting requirements for the purpose of reporting impacts of projects on the communities the serve.) approx. Requested Grant Funding: No funding will be requested for O&M by the Municipality because they will payfor O&rYlfrom revenue acquired through sellingpower to the cruise ships. 4.4.3 Power Purchase/Sale The power purchase/sale information should include the following: • Identification of potential power buyer(s)/customer(s) • Potential power purchase/sales price - at a minimum indicate a price range • Pr000sed rate of return from arant-funded proiect The potential power buyer would be the cruise in Skagway. Concepts for Power purchase agreements will be discussed with the cruise lines in Phase IL The intent of the agreements will be to set a rate which is less than the cost of self -generation by the cruise ships, yet provides an adequate return to the Municipality and the State. The Municipality's preliminary economic analysis far the Project assumes a sales price of $0.2521HYh in 2015, escalating at 2.75%per year. That price is 90% of the expected cost of self -generation by the cruise ships with diesel fuel at $3.88/gallon. Fuel costs are currently less than $3.88/gallon because of the global economic downturn, but by 2015 when the Project could be operational, the cost of diesel fcrel should be at least that much. The analysis also assumes that fuel prices and the power sales rate are constant after 20 years. Under these assumptions, the calculated rate ofreturn is 6.4%. The calculated savings over 50 years is $165,000, 000 by the cruise lines and $268, 000, 000 by the Municipality and State. Clearly, this Project has the potential to be a significant source of income for both the Municipality and the State. In addition power purchase agreements will be reviewed with Yukon Energyfor energy they would use in the winter and reciprocal purchase by the MOS for any additional need by cruise ships during the period of time in the summer months when Yukon Energy has excess power. 4.4.4 Project Cost Worksheet AEA12-001 Grant Application Page 14 of 18 7/1//2011 ALASKA Renewable Energy Fund ® CWT) ENERGY AUTHORITY Grant Application Round 5 Complete the cost worksheet form which provides summary information that will be considered in evaluating the project. Cost Worksheet is included in Section 9—Appendices. SECTION 5— PROJECT BENEFIT Explain the economic and public benefits of your project. Include direct cost savings, and how the people of Alaska will benefit from the project. The benefits information should include the following: • Potential annual fuel displacement (gal and $) over the lifetime of the evaluated renewable energy project • Anticipated annual revenue (based on i.e. a Proposed Power Purchase Agreement price, RCA tariff, or cost based rate) • Potential additional annual incentives (i.e. tax credits) • Potential additional annual revenue streams (i.e. green tag sales or other renewable energy subsidies or programs that might be available) • Discuss the non -economic public benefits to Alaskans over the lifetime of the project Potential annual fuel displacement: The Project will displace about 1.9 million annually, which equates to a reduction of approximately 22,000 tons in emissions from the combustion of fossil fuels. Over a 50 year period the Project could potentially save 93 million gallons of diesel fuel. 1 Anticipated annual revenue: The Municipality would negotiate power purchase agreements with cruise lines that would provide power to the cruise lines at a cost less than self -generation. This would provide direct financial benefits to the cruise lines at no cost to them. The Municipality would also negotiate the PPA rates to provide a positive revenue stream that would be shared between the Municipality and the State. Over the 50-year life of the Project, the revenue/savings could amount to as much as $165, 000,000 to the cruise lines and $268, 000, 000 to the Municipality to the State (undiscounted). Potential additional annual incentives: Not estimated. Potential additional revenue streams: Not estimated. The Municipality may also be able to sell surplus power to the local utility and winter energy would be sold to Yukon Energy. Non -economic public benefits to Alaskans: The primary non -economic benefits of the Project are the environmental benefits from reducing diesel generation by cruise ships while docked in Skagway. These environmental benefits will maintain Skagway's desirability as a cruise ship destination, which will provide indirect economic benefits to Skagway and the State. There are unknown benefits from cleaner air for the residents of Skagway and ULC in general. Other benefits: In the short term the local economy would benefit due to local hire for construction labor, materials for construction, and lease or rental of equipment. In the long term, there would be employment for O&A11 of the Project. SECTION 6— SUSTAINABILITY Discuss your plan for operating the completed project so that it will be sustainable. Include at a minimum: • Proposed business structure(s) and concepts that may be considered. • How you propose to finance the maintenance and operations for the life of the project • Identification of operational issues that could arise. ' 1.9 million gallons @ 138,000 btu/gal equals 262,200 MM/btu emissions are 168.40 Ibs/mmbtu thus air emissions are about 22,077 tons per year. AEA12-001 Grant Application Page 15 of 18 7/1//2011 ® ALASKA Renewable Energy Fund ENERGY AUTHORITY Grant Application Round 5 • A description of operational costs including on -going support for any back-up or existing systems that may be require to continue operation • Commitment to reporting the savings and benefits The Municipality may operate the Project or may contract with AP&T to operate the Project to supply power to cruise ships that dock at Skagway's port. A contractor or AP&T may maintain the Project, which can be expected to have a life of at least 50 years. The Project will be remotely operated, with continuous monitoring by a SCADA system. O&Mpersonnel will visit the plant at least once per weekfor routine checks on the equipment. A routine maintenance schedule will be established, annual shutdown for maintenance can be made during the fall after the end of the cruise season. Operation and maintenance costs will be financed by the revenuesfrom power sales. No backup generation system will be required. The Municipality will provide any reporting of the savings and benefits that AEA considers appropriate. SECTION 7 — READINESS & COMPLIANCE WITH OTHER GRANTS Discuss what you have done to prepare for this award and how quickly you intend to proceed with work once your grant is approved. Tell us what you may have already accomplished on the project to date and identify other grants that may have been previously awarded for this project and the degree you have been able to meet the requirements of previous grants. The Municipality will authorize AP&T to proceed with the Phase II work as soon as AEA indicates the proposed grant amount will be awarded. The Municipality and AP&T have collected documentation from previous studies and some information regarding cruise ship loads. The Municipality applied for a grant in REF Round 2, and was recommended for $236, 000 in grant finding for the Phase II work, however, the f nds were not allocated. The Municipality has not applied for or received any other grants for the Project. AEA12-001 Grant Application Page 16 of 18 7111/2011 ® WD ALASHKA Renewable Energy Fund Grant Application Round 5 SECTION 8— LOCAL SUPORT Discuss what local support or possible opposition there may be regarding your project. Include letters of support from the community that would benefit from this project. Local support is indicated by passage of a resolution by the Borough and Municipality of Skagway to pursue finding for this project. SECTION 9 — GRANT BUDGET Tell us how much you want in grant funds Include any investments to date and funding sources, how much is being requested in grant funds, and additional investments you will make as an applicant. Include an estimate of budget costs by milestones using the form — GrantBudget5.doc Total Pr iect Costs: $140,000,000 (excluding reserve account for janding negative cash flows) Investments to date and funding sources: $0 Amount requested in grant (ands: $236,000 (for Phase H work) Additional investment by Municipality: The Municipality will provide matching finds in the amount of $59, 000 for Phase II work (20% match). AEA12-001 Grant Application Page 17 of 18 7/1/l2011 ®ALASKA ENERGY AUTHORITY Renewable Energy Fund Grant Application Round 5 SECTION 10 — ADDITIONAL DOCUMENTATION AND CERTIFICATION SUBMIT THE FOLLOWING DOCUMENTS WITH YOUR APPLICATION: A. Contact information, resumes of Applicant's Project Manager, key staff, partners, consultants, and suppliers per application form Section 3.1 and 3.4. Applicants are asked to separate resumes submitted with applications, if the individuals do not want their resumes posted. B. Cost Worksheet per application form Section 4.4.4. C. Grant Budget Form per application form Section 9. D. Letters demonstrating local support per application form Section 8. E. An electronic version of the entire application on CD per RFA Section 1.7. F. Authorized Signers Form. G. Governing Body Resolution or other formal action taken by the applicant's governing body or management per RFA Section 1.4 that: - Commits the organization to provide the matching resources for project at the match amounts indicated in the application. - Authorizes the individual who signs the application has the authority to commit the organization to the obligations under the grant. - Provides as point of contact to represent the applicant for purposes of this application. - Certifies the applicant is in compliance with applicable federal, state, and local, laws including existing credit and federal tax obligations. H. CERTIFICATION The undersigned certifies that this application for a renewable energy grant is truthful and correct, and that the applicant is in compliance with, and will continue to comply with, all federal and state laws including existing credit and federal tax obligations and that they can indeed commit the entity to these obligations. Print Name Signature Title Date AEA12-001 Grant Application Page 18 of 18 7l1//2011 APPENDICES TABLE OF CONTENTS 1. Municipality Resolution (MOU) 2. Yukon Energy Corp Letter of Interest 3. Project Maps 4. Project Schedule 5. Environmental Excerpt from 1982 AEA Feasibility Study 6. Land Ownership 7. Resume's 8. Cost Worksheet 9. Grant Budget Form MEMORANDUM OF UNDERSTANDING Proposed by: Administration Vote: 6 Aye 0 Nay 0 Absent MUNICIPALITY OF SKAGWAY, ALASKA RESOLUTION NO. 11-15R A RESOLUTION OF THE MUNICIPALITY OF SKAGWAY, ALASKA SUPPORTING A FEASIBILITY STUDY FOR THE DEVELOPMENT OF HYDRO -ELECTRICITY IN WEST CREEK AND AUTHORIZING ADMINISTRATION TO SUBMIT A RENEWABLE ENERGY FUND GRANT APPLICATION TO THE ALASKA ENERGY AUTHORITY (AEA) TO SECURE FUNDING. WHEREAS, The Municipality of Skagway wishes to pursue a feasibility study to determine if hydro -electricity can be generated from West Creek; and WHEREAS, The Municipality of Skagway has approved $59,000 in its FY 2012 budget to serve as the required match for the Renewable Energy Fund Grant. NOW THEREFORE BE IT RESOLVED, that the Municipality of Skagway supports a feasibility study for the development of hydro -electricity in West Creek and authorizes administration to submit a Renewable Energy Fund grant application to the AEA to secure funding. PASSED AND APPROVED this 21st day of July, 2011 by the Assembly of the Municipality of Skagway, Alaska. Thomas D. Cochran, Mayor ATTEST: Emily A. Deach Municipal Clerk (SEAL) Proposed by: Administration Vote: 6 Aye 0 Nay 0 Absent MUNICIPALITY OF SKAGWAY, ALASKA RESOLUTION NO. 11-15R A RESOLUTION OF THE MUNICIPALITY OF SKAGWAY, ALASKA SUPPORTING A FEASIBILITY STUDY FOR THE DEVELOPMENT OF HYDRO -ELECTRICITY IN WEST CREEK AND AUTHORIZING ADMINISTRATION TO SUBMIT A RENEWABLE ENERGY FUND GRANT APPLICATION TO THE ALASKA ENERGY AUTHORITY (AEA) TO SECURE FUNDING. WHEREAS, The Municipality of Skagway wishes to pursue a feasibility study to determine if hydro -electricity can be generated from West Creek; and WHEREAS, The Municipality of Skagway has approved $59,000 in its FY 2012 budget to serve as the required match for the Renewable Energy Fund Grant. NOW THEREFORE BE IT RESOLVED, that the Municipality of Skagway supports a feasibility study for the development of hydro -electricity in West Creek and authorizes administration to submit a Renewable Energy Fund grant application to the AEA to secure funding. PASSED AND APPROVED this 215t day of July, 2011 by the Assembly of the Municipality of Skagway, Alaska. Thomas D. Cochran, Mayor ATTEST: Emily A. Deach Municipal Clerk (SEAL) YUKON ENERGY CORPORATION LETTER OF INTEREST YU KO N ENERGY 0 .lulu 15. 21011 Mayor -1 om Cochran \Municipality ofskagway Box 415 Ska,way. AK 99840 Dear Mayor Cochran: YUKONENERGY CORPORATION P.O. Box 5920 WHI'TEHORSE YUKON YtA 6S7 (867) 393-53010 First. dr_ 't mor I Mould like to thank -you for taking the time to meet will, n,e to discuss the proposed \\ est Creek Ifydro Project- 1:011t ti ing our meetinI. I had the opportunity to visit the site of the proposed \Vest Creek Ilydro Project and get a look at things first hand. As %%e discussed, Yukon is in a major' growth phase and ace are activeh' scarchine, for more options to devch,p ne%c capacity to trivet our gro%y ins= loads. %k c are ccr: interested in continuinL to discuss and examine the opportunities regarding the \X'c t Creek project. In terms ofsuitability; Ares, Greek provides some rcn interesting options. Yukon Energy is looking for rcnc%v tble and clean sources of pourr I:or primarily «intcr-based load increases. if \lest Creek could be utilized to proy ide power tsar summer custonlers in Skag,ray. ,cc would be very interested in pursuing the purchase of surplus po\rcr from the system during the winter. The size ofthe project is particularly attractitie for Yukon Fnergv as it is significant1v large enou11i, to meet our growing loads but also it should be large enou,,h to offset the costs ofbuildiog ne» transmissiOn lines to %Vl,itehorse. In addition once the transmission lines are in place, Yukon hydro projects that are not currently economic would potentially become economic additions- to the system. This would of course also make it possible for Yukon Energy to sell any Sumner surpluses to SkagwaY to offset diesel powcr from cruise ships. I would like to continue our discussions and meet on a regular basis to Outline ho%% %ce might reach a business arr<anement as your project proceed,- Please do not hesitate to contact me if You have any questions or would like additions( information. Yours truly. Dac d(orrison President S-, CI O PROJECT MAPS FIGURE 1 PROJECT LOCATION m��Rc`c ALASKA FAIRBANKS i _ t -ANCHORAGE BERING SEA GULF OF ALASKA WEST CREEK - HYDRO - - - -- HAINES. 'SKAGWAY ..IUNEAU L _ 17 Ix iii Lit c Q v u V i LU r ; . dy Lu O _J V (D q� > X U e% Q re 7T 1• Q gyp. .(-(y` t _ _ i \ Oi s, `.iI - f.. tf _ PROJECT SCHEDULE F- L) W W 0 J I aW U cxi Rz F- 0 WO F W j W oR' zy } O = U YO Ul Q W Z fL 0 Uy U) W uj ❑ W a ...................................................................................................................................................................................... m a N N O O a n O N �y Q Q Q Q `1 N N .0.. .................................................................................................................. .................... . ............................. O O N N O ..... .................... .................................. ................... ..... ............................. ................................................................. o - 0 .a .................................................................................... ............................................................................... 0 'o N o N N Q .................................................... ................................................................................................................... O N .O d ........ ............ ®IIAM.......... .................. .............................. ...................................................... ................ ............... N N O ...................................................................................................................................................................................... O C @ T E c Z O o o � E o @ a @ m o @ c C @ N T a` C 'O 9 E O. U C C p_ @ @ EL C@ C N @ Vi d N T C E_ U O. 4@ j E O. Ol "O O. O. O ([ "O 61 O] N C @ N N iy U c p@ W O C LL' O C .�. Q Q N O jp U= N I3. ._ N -EN_ E C N« T O. 2 O U W a a o ENVIRONMENTAL EXCERPT FROM 1982 AEA FEASIBILITY STUDY HAINES-SKAGWAY REGION FEASIBILITY STUDY VOLUME 1 — REPORT R.W. BECK AND ASSOCIATES, INC. .TUNE 1982 FOR THE ALASKA ENERGY AUTHORITY SECTION XIV EFFECT ON ENVIRONMENT OF THE SELECTED PROJECT ARRANGEMENT 1. GENERAL The following discussion addresses potential impacts and mitigation with respect to fisheries resources, wildlife resources, water quality, historical and archaeological resources, socioeconomics, recreational resources, aesthetic resources, air quality, and land use. Environmental studies found that the environmental impacts of the West Creek Project are limited in scope and not expected to significantly affect Project development. A report by the consultant Environaid, describing on -site environmental investigations provides the basis for discussion of the fisheries, wildlife, and historical and archaeological resources and is included in Appendix C. 2. FISHERIES RESOURCES Few fisheries resources are known to occur in West Creek based on field observations, fish sampling, and interviews with local residents. Consequently, impacts on the fisheries resources are expected to be minimal. The following presentation describes the habitat and fisheries resources of West Creek, and discusses potential Project impacts. Above the dam site, the creek is a stream of moderate gradient, turbid waters, and predominantly boulder, cobble, and gravel substrate. There are a number of small tributaries of relatively clear water with suitable sahnonid spawning substrate. These tributaries were in the general area of the proposed reservoir and would be the most probable location of residential fish. Attempts were made to sample fish with minnow traps in three of the tributaries. However, no fish were encountered. Reports by residents at Skagway and Dyea indicate that few if any fish reside or spawn in waters near the proposed dam site. Below the dam site, the tipper gorge has a steep gradient and contains a series of cataracts and chutes. Upstream fish passage is extremely difficult if not impossible, at least during the periods of high flow from May to November. Further downstream within the middle basin, high velocity flows persist and substrate is predominantly boulder and cobble. Little rearing or spawning habitat occurs in the stream channel in this area. However, two small tributaries enter this section that contain good quality spawning gravel in their lower reaches. Sampling of these tributaries with minnow traps revealed a low density, slow growing population of Dolly Varden char that is believed to be resident rather than anadromous. The lower gorge just below the middle basin is an extended section of rapids and falls. The sustained high velocity of this reach appears to prevent upstream passage by fish and , therefore, would block use of the creek above this point by anadromous fish. Between the lower gorge and its mouth, West Creek widens and the velocity is reduced. As the creek approaches its confluence with the Taiya River, the gradient declines and the substrate changes from boulder to cobble, gravel, and finally sand at the confluence. These is a single tributary on the north side of West Creek below the bridge that connects to a cutoff meander channel. Large Dolly Varden have been observed in the tributary but no other fish have been seen in this small stream or in West Creek. The possibility exists that a few fall chum or coho may utilize the tributary or lower West Creek. Eulachon (candlefish) are known to spawn in the lower Taiya River and are reported to spawn in the lower sandy reaches of West Creek. Sources of potential impacts on fisheries resources include inundation of stream habitat by the reservoir, alterations of the West Creek flow regime due to Project operation, increased turbidity and sediments from construction activity, changes in stream temperature due to the reservoir, and nitrogen supersaturation from water plunging over the spillway. The reservoir would inundate approximately 2.5 miles of stream habitat in West Creek and small amounts of stream habitat in the lower reaches of three minor tributaries (Fig. lb). Because there is no evidence of fish populations in this general area, it appears that no fishery impacts would result from inundating the tipper valley. The indicated lack of fish resources also eliminates any concern for turbine -related injuries or mortalities of fishes entering the power intake from the reservoir. The proposed Project would cause changes in the flow between the dam and the powerhouse. Dining the low flow months, December through April, there would be no flow below the dam. The lack of flows could extend into early summer as the reservoir fills. In summer and early fall, the flows would be much greater as melt -water flows fill the reservoir exceeding generation requirements and result in excess water being spilled. In general, however, flows would still be less than under natural conditions. (See Section XI, Power Operation Studies.) However, little impact on fisheries is expected in West Creek between the dam and the powerhouse because no fish are known to reside in or Feasibility Study for AEA by R.W. Beck p. 2 West Creek Hydro June 1982 Section XIV migrate through the creek above the lower gorge. The small population of resident Dolly Varden char, known to exist in the lower sections of the two tributaries of this part of West Creek, should not be significantly affected by the reduced flows. Below the powerhouse site, the major changes in the flow regime would occur during the winter and spring months. The principal demand for power is from December to April which are generally low flow months in the watershed. During this period, generation would come from reservoir storage. Thus, average daily flows below the powerhouse would increase during the winter and spring. Substantial daily variation in flow would occur because power generation would be keyed to the daily cycle of electrical load demand. This may cause flows to be less than what would occur under natural conditions for a part of the day and greater for the remainder. These effects could continue into early summer while the reservoir is filled. During the naturally high flow months of summer and early fall, the average daily flows would not change and the daily variations associated with electrical load demand would be small relative to the magnitude of the total flows resulting from spill. The changes in the flow regime of lower West Creek are not expected to impact fish access to or use of the single tributary where Dolly Varden are known to occur. Flow variations in the winter and spring could affect fish spawning or rearing activities in lower West Creek; however, indications are that little if any of these activities exist with the exception of spring spawning of eulachon. Turbidity and sediments may increase in West Creek because of blasting and other construction activities. This would result in transient impacts on the stream habitat, fishes, and other aquatic organisms. Currently accepted, prudent construction practices would be implemented to minimize these effects, including proper application of bank stabilization, control of surface runoff, reclamation, and revegetation measures. No significant alterations in the water temperature regime are anticipated to result from the effects of the proposed reservoir or operation of the project; therefore, no fisheries -related impacts would be expected. Stream temperatures are currently being monitored, and potential water temperature changes will be evaluated after on year's temperature record is completed in the summer of 1982. Supersaturation of nitrogen in the stream waters below a dam could impact fisheries resources. This phenomenon can develop from waters plunging over a spillway into a stilling basin below a dam. Nitrogen supersaturation causes gas bubble disease in fishes and is destructive to both juvenile and adult fishes. The chute spillway planned for the Project would not cause supersaturation of nitrogen. Sport or subsistence fishing opportunities in West Creek are limited by the available fish resources. No fishermen were encountered during Project studies on West Creek. Fishing for Dolly Varden in the tributary near the creek mouth and dip netting for eulachon in lower West Creek appear to present the best opportunities. No impact on sport of subsistence fishing is expected. Feasibility Shidy for AEA by R.W. Beck P. 3 West Creek Hydro June 1982 Section XrV The Taiya River supports runs of coho, chum, pink, Dolly Varden, and eulachon. Impacts of West Creek flow variations, possible turbidity increases, and possible temperature alterations on these fish resources are expected to be minimal because West Creek contributes only 30% of the total flows of the Taiya River. The submarine routing of the transmission cable from Skagway to Haines would have little impact on marine organisms. Minor physical disruption of marine benthic and intertidal communities would occur when the cable is laid. Electrical and magnetic -field effects of the 34.5-kV insulated cable would be minimal and localized with little -to -no physical or behavioral effects on fishes and other organisms. There may be some risk of fishing gear or anchors fouling on the transmission cable. The major mitigation concerns for fisheries are to assure no impact from nitrogen supersaturation through proper design of the spillway and to maintain the alluvial channel in West Creek below the powerhouse and gorge. The latter provision would allow fish access to the tributary on the north side of the creek below the bridge. It is unlikely, however, that the Project would adversely affect access to the tributary. A more complete assessment will be made after topographic mapping of the lower creek section is completed and Project layout has been determined. No mitigation activity would be required for the Dolly Varden in the tributaries of the middle basin because the populations are not expected to be significantly affected by any changes in habitat due to alterations of West Creek flows. Two fisheries enhancement possibilities have been suggested: (1) providing a water supply source for a hatchery at the tailrace; and (2) modifying the tailrace to serve as a spawning channel. It is expected that implementation of either enhancement measure would entail development of required fish facilities by the Alaska Department of Fish and Game (ADF&G) or the Northern Southeast Regional Aquaculture Association (NSRAA). Factors to consider in evaluating the potential of the hatchery or spawning channel include quality of water from the reservoir, the capacity of the Taiya River and Taiya Inlet to support an increase of out migrants, the availability of fish stocks to be used in the facilities, and specific effects of a propagated run on existing fisheries and management of the fisheries. Discussions have been initiated with ADF&G and NSRAA regarding the possibility of developing a spawning channel in the tailrace. Further consultation with these agencies is expected to better assess these fisheries enhancement opportunities. WATER QUALITY West Creek is a glacially -fed stream with highly turbid waters, particularly during the high flow months of summer. Water temperatures range from less than 10`C in the summer down to 0°C in the winter. Dissolved oxygen is high because of the low temperatures and cascading passages. The clearcut area on the north side of the middle basin (Fig. 16) has been revegetated and does not affect stream water quality. Currently, Feasibility Study for AEA by R.W. Beck p. 4 West Creek Hydro June 1982 Section XIV there is no known human activity or development in the watershed that has any significant impact. No significant effects on water quality would be expected from the Project. Temporary increases in suspended sediments and turbidity would occur in the West Creek during constriction due to erosion associated with clearing and grading of lands, spoil disposal, road use, and blasting at the dam site. Standard prudent construction industry practices including proper bank stabilization, runoff control, and revegetation of exposed soils would minimize impacts on water quality. Subsequent to construction, the reservoir would act as a sediment trap removing larger sediments from the downstream flow. Generally, only colloidal -sized particles would remain in suspension by the time waters passed out of the reservoir. There is, however, the potential for erosion of the exposed banks of the reservoir during periods of drawdown. This could have the effect of increasing turbidity in the reservoir and downstream. No major alterations of the water temperature regime would be expected. The proposed reservoir could cause a slight delay in warming of the stream in the spring and cooling in the fall. An evaluation of potential Project effects on water temperature will be made at the completion of ongoing stream temperature monitoring studies during the summer of 1982. 4. WILDLIFE The major wildlife species in West Creek Valley are mammals and birds. Common mammalian species include black bear, mountain goat, various furbearers, and several species of voles and mice. The Sitka black -tailed deer, moose, and wolf are not found in the valley. A few brown bears may include portions of West Creek within their home range, and there have been seasonal sitings (sic) of wolverine and coyote. Bird species include various waterfowl, grouse, and the bald eagle. Many other birds, such as other raptors, shore birds, and passerines, also occur in the valley. No Federally -listed endangered or threatened species resides in the Project area. The principal impacts on wildlife would result from inundation of habitat by the storage reservoir, loss of habitat on lands required for Project structures, disturbance of wildlife by construction activities, and wildlife disturbance associated with improved public access. The storage reservoir would inundate approximately 600 acres of conifer forest, riparian shrub, and sedge marsh. Most of the resident wildlife would be immediately lost. Birds and larger mammals would be dislocated to other areas. These animals could only become established on adjacent habitat if those areas were capable of supporting them. Feasibility Study for AEA by R.W. Beck p. 5 West Creek Hydro June 1982 Section XIV Indications are that black bear occupy virtually all of the valley floor and forested slopes and, therefore, have fully partitioned the habitat of the watershed among the population. Loss of habitat to the reservoir would require a readjustment of individual bear home ranges and if the remaining habitat is fully occupied, the loss of one or more bears from the watershed could occur. The side slopes of the valley support a stable mountain -goat population. The reservoir and other Project features would not be expected to affect any of their habitat and would have no direct impact on the population. The elimination of habitat would impact small animals that are abimdantly distributed in the area of the proposed reservoir, including deer, mice, least shrews, porcupines, and red squirrels. Furbearers such as river otter, marten, least weasels, and mink may also be impacted. Some benefits to forbearers would be derived from the reservoir's new riparian habitat although these benefits would be tempered by the annual fluctuations of the reservoir surface. Birds would be only slightly impacted by reservoir inundation. The proposed reservoir area contains less than 3 acres of waterfowl habitat or approximately half of the open Stillwater habitat in the valley. In addition, the reservoir would inundate only one square mile of poor quality grouse habitat or about one -eighth of the total grouse habitat in the watershed. Virtually all of the bottoraland to be inundated has some habitat value for the general avifauna. The impacts due to the inundation of bird habitats are expected to be small. At maximum pool elevation, the reservoir would create 600 acres of standing water with approximately 5 miles of shoreline and associated shallows. It is probable that more waterfowl habitat would be created than destroyed, although the habitat quality would be influenced by the extent and timing of reservoir drawdowns. The reservoir would displace a small number of grouse, but the effect on the overall grouse population would be minor. Numbers of some species of the general avifauna would be reduced and others increased, but no species would be eliminated. In fact, habitat may be created for new species resulting in a more diverse avifauna overall. Additional habitat losses, with fewer through similar impacts on wildlife, would develop from emplacement of Project strictures. The impacts would be smaller in scale and would result from building the dam, surface penstock, powerhouse, access roads, and transmission line. Minimal effects would result from constriction of the power tunnel because the overlying land surface would remain undisturbed. Localized disturbance to wildlife would be caused by construction activities such as blasting, road use, heavy equipment operation, and tunnel boring. Changes in wildlife distribution and behavior, such as relocation of black bear home ranges, would be expected. These changes would be temporary and subject to readjustments on completion of construction. Feasibility Study for AEA by R.W. Beck p. 6 West Creek Hydro June 1982 Section XIV Presently, the West Creek valley supports little recreational hunting or wildlife observation activities, probably because access is limited by the steep valley walls and dense bottomland vegetation. The possibility exists that road improvements associated with Project development would, by improving access, encourage an increase in wildlife use. The Alaska Department of Fish and Game is interested in any associated increase in hunting pressure on mountain goats in the valley. The West Creek goat population appears capable of sustaining a larger harvest than it has experienced in recent years. No major wildlife mitigation measures are planned because no significant detrimental effects on the populations of any wildlife species are anticipated. Planned mitigation measures include minimizing the clearing of vegetation to curtail destruction of habitat during constriction; locating the access road and other Project features to minimize disruption of the travel routes of wide-ranging mammals within the narrow valley -bottom corridor near the dam site; revegetating areas denuded during the constriction process; and designing the above -ground sections of the transmission line to minimize potential impact on raptors such as the bald eagle. 5. HISTORIC AND ARCHAEOLOGICAL RESOURCES Potential impacts on historic and archaeological resources were evaluated based on field reconnaissance, review of ethnographic literature, and interviews with local residents. The evaluation focused on locations of potential ground disturbance associated with constriction of the dam and reservoir, power tunnel, powerhouse, and transmission line. Archaeological and historical field investigations were limited to surface inspection of study areas. No excavations or test pits were dug in compliance with agreements with the National Park Service and the Alaska State Historic Preservation Officer. No cultural resources were found at the proposed dam site, within the proposed reservoir, or in the areas of expected construction activity associated with the power tunnel or powerhouse. Consequently, no impacts on historic and archaeological resources are expected relative to the development of these Project features. The transmission line could be buried throughout its route within the National Park to avoid negative aesthetic impacts. Within the National Park and along the west side of the Taiya River, the transmission line corridor would cross the historic Chilkoot Trail, northern portions of the Dyea community, and other areas of gold rush activity (Fig. 17). In this same general area, parts of the native Village of Dyea may have existed, though its presence was not identified during current field investigations. Evidence of the pre -gold rash native village may have been overlain by or incorporated into subsequent site developments. Although the potential exists for cultural impacts west of the Taiya River, the area has been disturbed by relatively recent activities. The short section of the corridor between the powerhouse and Dyea Road is criss-crossed with roads and tracks. It contains houses, sheds, and barbed wire fencing along with abandoned wood stoves, large kitchen appliances, motor vehicle parts, and other contemporary discarded Feasibility Study for AEA by R.W. Beck p. 7 West Creek Hydro June 1982 Section XIV materials. Parts of the area have been selectively logged. The State Department of Transportation and Public Facilities has cleared the roadside within the right-of-way. The transmission line would likely be located within this roadside clearing. The road, built in the 1940's, was cleared by pushing the vegetation where excess construction material was deposited. Most cultural resources of the gold rush period are located away from Dyea Road, although the Chilkoot Trail crosses the road approximately 0.1 mile northwest of the Taiya River bridge. After determining the exact transmission line route within the corridor on the west side of the Taiya River, additional archaeological/historical investigation would be required. Final location of this section of the transmission line woul necessitate consulting with and obtaining approval of the Alaska State Historical Preservation Officer and the National Park Service. Four potential areas of concern were found within the transmission corridor on the east side of the Tiaya River Valley: the modern Chilkoot Trail and trailhead; the wooden structures and out -buildings east of Dyea Road at Mile 8.4; the National Park Service ranger station at Mile 8.3; and the marine shell deposit at Mile 8.0 (Fig. 17). By avoiding these areas in final routing, the need for investigating these sites further may be eliminated. Similarly, in the corridor section between the Taiya River and Skagway, potential impacts would be eliminated by avoiding specific areas containing cultural materials. These materials include a single steel wire telegraph/telephone line that nets over the east ridge at about Mile 6.6 and, of less significance, the shed and possible other materials at the trailhead of the Skyline Trail, the pet cemetery, and the suspension bridge remains near the Skagway River (Fig. 17). Mitigation for historical and archaeological resources usually takes two forms: avoidance of impacts by relocating Project facilities and scientific data recovery. Pending results of additional surveys in the sensitive areas noted above, no specific mitigation requirements are indicated at this time. The potential does exist for cultural remains to be encountered unexpectedly during construction. In that event, investigation of the frid would be necessary to determine it value and whether mitigation would be necessary. 6. SOCIOECONOMIC The principal socioeconomic impacts would be the housing needs and payroll spending of temporary construction workers on the City of Skagway. The Project site is located within Skagway's corporate limits approximately 10 miles by road from the center of town. It is common practice in Alaska for dam construction workers to live in "bachelor quarters" near a project site. The remote location of many construction sites, the need to import workers with special skills, transportation difficulties, and union requirements to Feasibility Study for AEA by R.W. Beck P. 8 West Creek Hydro June 1982 Section XIV provide worker transportation between the job site and the place of worker residence all contribute to this practice. Except for workers already living in the local area, Alaska dam construction projects usually have few workers accompanied by dependents. Because housing would be provided by the constriction contractor at the Project site, the average work force of 100 men would have little impact on the City of Skagway's summer housing shortage, schools, and other facilities. However, if the City of Skagway adopts land use policies that would restrict the location of temporary housing at the Project site, the impacts of temporary construction workers on the City's housing stock and public facilities would require further investigation. The construction contactor would provide meals for workers living at the construction site. Some supplies would likely be purchased locally. Most constriction equipment and materials are not available locally and would be purchased from available sources located outside Alaska and transported to the site either by sea, road, or rail. A portion of the construction workers' payroll would be spent for entertainment and personal supplies in Skagway. Another possible socioeconomic impact would be a tax loss to the City of Skagway due to the purchase of private lands for the Project. Project lands and properties would not be taxable as public assets. However, the amount of private land to be used for the Project is very small. The Project reservoir and dam site are located almost entirely on State land. A portion of the reservoir would include State lands which have been allocated to the City of Skagway for future private sale. (See Fig. 18) Ten acres of National Park land would probably be used for the powerhouse site. Approximately 2 acres of private land would be used for the tailrace as well as approximately 2 acres of State lands and 4 acres of National Park lands. The assessed value of the private land and Skagway allotment lands currently is estimated to equal about $75,000 (Charles Horan, December 1, 1981).(14) The value of the remainder of State lands is estimated to equal about $250,000. In the area of the Project, the City of Skagway levies a property tax on the assessed value of private land of 19% of $4.00 per $1,000 assessed value or $0.76 per $1,000. Possible tax revenue losses from private lands and State allotment lands (if sold for private use) currently would equal about $60 a year. In 1981 the City did not assess personal property, indicating no off -setting tax revenue would accrue from a tax on the value of construction equipment to be located at the Project site. If the tax were collected, it would be assessed at the same rate as for property tax. The State -maintained Dyea Road will provide public access to the Project site. The road may have short periods of restricted travel when constriction equipment is being mobilized. Equipment could be moved during periods of light traffic and would avoid periods of peak summer use of the Klondike Gold Rush National Historical Park. No permanent road closures or modifications of the State road would be required during or after Project construction. The Project area is not served by electric or telephone service. The site is not within the franchised service are of the local private electric and telephone company. Construction would require providing electric and telephone service at the Project site. Feasibility Study for AEA by R.W. Beck P. 9 west Creek Hydro June 1982 Section XIV Electrical service could be provided by the constriction contractor or purchased from the electric utility. Providing electric and telephone services to the Project offers the possibility of providing one or both of these services to local residents living in the Taiya River Valley near the Dyea Road. Since this opportunity for service occurs outside the franchise area of the electric and phone company, a mechanism for financing these improvements would need to be developed. The small population of the area may make the cost of improvements difficult to finance. The impact on future residential development in the area would also need to be considered. The National Park Service would be a major participant in any discussions on extending electrical or telephone service within the park boundary. RECREATIONAL RESOURCES The Chilkoot Trail Unit of the Klondike Gold Rush National Historical Park is the only established recreation facility in the vicinity of the Project. This Unit totals approximately 9,100 acres and consists of a corridor of parkland approximately one mile wide and 17 miles long, paralleling the entire length of the Chilkoot Trail within the United States. The Unit lies principally in a north -south direction, with the south boundary extending to saltwater at Taiya Inlet and the north boundary located at Chilkoot Pass on the United States -Canadian border. Included in the Unit are the historic townsite of Dyea, the 36-campsite Dyea Campground, the Chilkoot Trail, and all related historic sites and artifacts along the trail and in the vicinity of Dyea. The modern Chilkoot Trail begins where the Dyea Road crosses the Taiya River. The trail is located on the east side of the river and traverses Chilkoot Pass to Lake Bennett, Canada. (15,16) More than 2,500 hikers traveled the trail in 1981 with almost 80% of the sue occurring in the months of July and August. (17) There are several trails in the vicinity of the Project in addition to the famous Chilkoot Trail. The little -used Lost Lake Trail begins on the west side of the Taiya River Valley about .75 mile south of West Creek near Dyea. (See Fig. 16) The trail climbs steeply for about 2 miles to Lost Lake which is nestled on the slope above the Taiya Valley. The only other trail is the Skyline and AB Mountain Trail which begins from the Dyea Road near Yakutania Point and extends 6 miles north to AB Mountain. Most hikers only travel the first 3 miles to a viewpoint of Skagway and Taiya Inlet. There are no recreational facilities located in the West Creek Valley. A logging road extends for approximately 2 miles from the Taiya Valley into the lower West Creek Valley, but not as far as the proposed dam site. An informal trail beginning at the road's end provides access to the tipper valley. Some residents of Skagway hunt, hike, and pick berries within the middle section of West Creek Valley. Some firewood is gathered in the lower valley. The Haines-Skagway Area Land -Use Plan classifies the West Creek Valley as public recreation land. Alaska Department of Natural Resources management policy Feasibility Study for AEA by R.W. Beck P. 10 West Creek Hydro June 1982 Section XIV recommends that this area be managed in a manner that permits existing recreational uses to continue and is compatible with Klondike Gold Rush National Historical Park objectives. (18) During construction, access to the West Creek Valley for recreation would be limited. However, there is the possibility of providing a dam overlook to accommodate public interest in construction activities. Construction activity, traffic, and noise may affect the recreationists at Klondike Gold Rush National Historical Park, particularly at the Dyea Campground, and hikers along the first 2 miles of the modern Chilkoot Trail. This impact would primarily occur in July and August when the majority of people visit the Park. There should be no impact to tourists visiting Skagway and the Skagway River Valley nor to the cruise ship, ferry, and airplane travelers in the region. Maintenance of the road to the dam would improve access to the valley. The reservoir and improved access could stimulate recreation use in the Project area. In addition to the possibility of a dam overlook, other possible recreational facilities include a hiking trail to Upper West Creek Valley and a boat launch ramp. Recreationists would probably be primarily Skagway residents. Visitors to the Project area would have to travel through the National Park but there should be minimal impact to existing Park uses and management objectives. (18) 8. AESTHETIC RESOURCES Most of the Taiya River Valley floodplain is included in the Klondike Gold Rush National Historical Park. The Dyea Road, running from Skagway through the valley, is frequently traveled by tourists and residents. The vegetation of the valley is mixed coniferous -deciduous forests (western hemlock, mountain hemlock, Sitka spruce, alpine fir, lodgepole pine, black cottonwood, alder, willow, and poplar) and provides dense cover during the summer except along areas that have been cleared, such as roadways. Visitors and residents alike have a high appreciation for scenic values. Project impacts that would affect residents and visitors to the Klondike Gold Rush National Historical Park would occur in the Taiya River Valley. During construction, traffic would increase, the noise of clearing, grading, blasting, and other activities would e evident, and scenic values would be diminished by construction of Project features such as the penstock, powerhouse, tailrace, and transmission line. Construction activity, though temporary, would be greatest during the months of July and August when most National Park visitation occurs. Subsequent to construction, impacts would be minimal because of mitigative measures incorporated into Project design, particularly as they apply to the penstock, powerhouse, tailrace, and transmission line. The 3-foot-diameter, 1,520-foot-long penstock is located on the west sideslope of the Taiya River Valley on State of Alaska land and in part within the National Park boundary. The 25-foot-high concrete powerhouse and 1,150-foot-long tailrace are located within the National Park. The penstock, powerhouse, and tailrace might be visible from the Lost Lake Trail, several Feasibility Study for AEA by R.W. Beck P. 11 West Creek Hydro June 1982 Section XIV points along the Chilkoot Trail, the Dyea Road, and several residences in the Taiya River Valley. The National Park Service and State of Alaska have a cooperative management agreement to protect the scenic qualities of the Taiya River Valley.(19) Mitigation measures to protect the scenic resources will include painting the penstock and revegetating the right-of-way to blend in with the existing landscape. The transmission line could be located underground where it passes through the National Park. Most of its route between the powerhouse and Skagway would probably parallel the Dyea Road, resulting in reduced clearing requirements for the right-of-way. Between the National Park and Skagway, the line would be a single -pole construction supporting stand-off insulators and would be designed to minimize any adverse impacts to scenic value. Submarine routing of the transmission line between Skagway and Haines would eliminate potential aesthetic impacts along Taiya Inlet. The dam and spillway would impact the scenery in upper West Creek. However, there is currently little public use of this area and these facilities would not be visible from the National Park or the Taiya Valley. 9. AIR QUALITY The air quality within the Skagway City limits is excellent. Winds, often in excess of 20 mph in Skagway and the nearby river valleys, and the lack of air pollution sources prevent concentration of air contaminants. No polluting industries are located within the City of Skagway, and no sources of air pollutants exist which require a Federal or State operating permit. The nearest permitted sources of air contaminants are located in Haines. These sources are some 20 miles distant from the Project and do not affect air quality in the Skagway area. The Project is located within the Southeastern Alaska Intrastate Air Quality Control Region (SAIAQCR). The entire air quality control region is under the jurisdiction of the Alaska Department of Environmental Conservation. For this air quality control region, the State of Alaska has determined that for all regulated air pollutants (total suspended particulates, nitrogen oxides, sulfur oxides, photochemical oxidants, carbon monoxide, and lead) the ambient concentrations fall within all Federal and State air quality standards (Alaska Department of Environmental Conservation, 1980). The Project study area (and the entire SAIAQCR) is designated an attainment area for all regulated air pollutants. (20) During the construction phase of the West Creek Hydroelectric Project, pollutants emitted to the atmosphere would be of two types: fiigitive dust generated by transportation and construction activities, and gaseous emissions from internal combustion engines. The fugitive dusts would results from land clearing, road construction and maintenance, blasting, site preparation, rock crushing, concrete hatching, and vehicular traffic. Gaseous emissions would be produced from internal combustion engines and would consist of oxides of nitrogen, carbon monoxide, sulfur Feasibility Study for AEA by R.W. Beek p. 12 West Creek Hydro June 1982 Section XIV dioxide, and hydrocarbons. In general, these emissions would be temporary, lasting only during the construction phase and would not significantly impact air quality. Additional pollutants would be emitted from the reservoir clearing operations and during periods of forest residue burning. These emissions would consist of particulates, carbon monoxide, hydrocarbons, and oxides of nitrogen. These emissions would be localized and temporary, and would have no long-term air quality impacts in the study area. There may be a minor increase in local fog in the vicinity of the reservoir. However, operation of the West Creek Project would not cause or contribute to any air quality impacts in the study area. 10. LAND USE As shown in Fig. 18 and Table XIV-1, most land in the Project vicinity is State selection land which is being transferred from the Federal Government. Some of this land has been allotted to Skagway for eventual private sale. The Federal Government also owns about 600 acres included in Klondike Gold Rush National Historical Park. Only about 55 acres, or 0.3%, of lands in the vicinity of the Project, are privately owned. The Department of Natural Resources, in its Haines-Skagway Area Land Use Plan, has classified State selection lands in the West Creek Valley for recreation use. (18) The intent of the classification is to keep the valley in an undeveloped state. However, the plan classification can be changed to meet new land use requirements. Modification of the plan will require a public hearing with legal notices. The process would probably take 6 months to 1 year. Construction of the Project would require about 10 acres of National Park land for the powerhouse site. The tailrace right-of-way from the powerhouse to West Creek would use about 8 acres of private, National Park and State land. A penstock would cross State and National Park land for a distance of about 1, 400 feet on the hillside located above the powerhouse. The dam and reservoir would use about 600 acres of State land of which about 100 acres is Skagway allotment land. (See Fig. 18). Additionally, an easement or right-of-way across private land and an easement along the State highway right-of-way would be required for the transmission line. The proposed powerhouse site, tailrace, and portions of the penstock and transmission line would be within the boundary of the National Park. An Act of Congress would be required to allow constriction of a power plant on any land which is within a National Park boundary or to relocate the park boundary. However, it is possible that permission to build the transmission line within the National Park boundary can be secured administratively. The principal land use change associated with the Project would be the flooding of the partially -wooded upper West Creek Valley. The lower elevation, eastern part of Feasibility Study for AEA by R.W. Beck p. 13 West Creek Hydro June 1982 Section XIV the valley, has some commercial forests of spruce and hemlock. The area to be inundated by the reservoir is in the tipper part of the valley where soil conditions and drainage are generally not conducive to commercial forest production. The land to be used for the powerhouse and tailrace is covered primarily with brush and cottonwood trees. Adjacent privately -owned bottomlands of brush and pasture would be crossed by the transmission line from the powerhouse to the State highway. The transmission line would then follow the State road except at a point where a hillside is crossed at the head of Nahku Bay. The State highway right-of-way crosses through lands owned by the National Park Service and Skagway State allotment funds. Except for two unoccupied cabins, no structures would be lost due to Project construction or operation. No vahiable agricultural lands in the area would be impacted by the Project. No permanent garden plots or improved pasturelands in private ownership would be used for the powerhouse site or transmission line route. A local access dirt road adjacent to the proposed route for the powerhouse tailrace may lie within the Project boundaries. Road access would still be maintained. Feasibility Study for AEA by R.W. Beck p. 14 West Creek Hydro June 1982 Section XIV LAND OWNERSHIP cs � fr�p n w - a n -�Ik FA , t r_ Ili utT StY'�.iNt1YTx n�' : ��\�\\\��N�\�\\\\ cl rD ZA i J � r MUNICIPALITY OF SKAGWAY, ALASKA y� SPECIAL ASSEMBLY MEETING *>.;xk�,.�-' September 12, 2008 Page 1 of 5 1. Call To Order: Mayor Cochran called the meeting to order at 5:00 p.m. 2. Roll Call: Present: Mayor: Tom Cochran, Assembly Members: Dan Henry, Colette Hisman, Dave Hunz, Mike Korsmo, Mark Schaefer Absent: Assembly Member: Lisa Cassidy 3. Proof of Notice: Clerk Harris indicted that notice had been posted at the Municipal Offices and Post Office, on the Municipal website, faxed out to the meeting list and emailed to each assembly member and mayor on September 5, 2008. 4. West Creek Hydro Protect: Manager Sorum indicated that his initial concern is what we are talking about is on entitlement land, owning the land makes things easier. He indicated that 6 parcels have been selected for survey and the State is in the process of getting the survey instructions prepared for those 6 parcels. The survey instruction process from the State is a long process and he is hoping to set up the survey contract to that as one survey is completed they will roll into the next set of instructions. He indicated that in this project owning the land is easier project wise. Manager Sorum indicated there was some concern in the first proposed MOU regarding guarantee of ownership, the current draft before the Assembly has been changed so that the Municipality agrees to pursue getting title to the property. Mayor Cochran indicated that if the Assembly approves this MOU it will obligate $5,000 for the grant application. Mayor Cochran asked how long following receipt of the survey instructions until we received title to the land. Clerk Harris indicated that the survey instructions for the 980 acres were received shortly before she started in 1997 and the length of the survey took several years to iron out issues with the survey. From the point when the Planning & Zoning Commission received the preliminary plat to the point when we received patent was 7 years. Mayor Cochran indicated this agreement obligates the Municipality to the $5,000 for paying for the grant application process, it does not guarantee that the Municipality will pursue the grant, its just getting the application in by the November 10th deadline. Once the application is in there is still a long way to go, there is still the feasibility study and if it turns out that it's not feasible the project isn't going to happen anyway. He indicated that normally permitting for a hydro project is 5 years and could be longer. Assemblyman Hunz indicated that he is a stockholder in AP&T for clarification. Motion/Second: Schaefer/Henry To accept the MOU with AP&T for the West Creek Hydro Project. Assemblyman Schaefer indicated that he thinks this is a good idea but it's a long process and will be several years down the road. Assemblyman Korsmo indicated that when it gets to that point and it does become feasible and the Assembly starts looking at different kinds of funding, he will make sure that the Assembly MUNICIPALITY OF SKAGWAY, ALASKA SPECIAL ASSEMBLY MEETING September 12, 2008 Page 2 of 5 concentrates some of the revenues coming in from the Cruise Ship Fund to developing the current projects we have like the boat harbor. He indicated he will make sure that the Assembly continues to develop those projects that are already elevated that the Assembly supports them before supporting something that could be a pretty huge drain on those special revenue tax monies coming in. Assemblyman Hunz indicated that the comments relayed to him are; why are we spending $5,000 of municipal funds to help a private corporation. Mayor Cochran indicated that it's a benefit to the community. Assemblyman Hunz asked how is the community going to benefit, we have hydro now and we are still getting diesel generation because the excess power is sold out of our region so now we are trying to generate more hydro power so we can protect our region. How do we know its going to stay here and not get sold elsewhere? He indicated that people are coming to him asking what's it going to cost the tax payers to build all this infrastructure and how are they going to benefit, they hydro AP&T has done now has stabilized the power but they are still paying the excess for somebody else to benefit. Assemblyman Korsmo indicated that a benefit for possibly public health if the ships plug in. Assemblyman Hunz questioned if they are going to buy it and indicated he doubted it if its $0.22 per kilowatt hour. Mayor Cochran indicated one thing to keep in mind if we do pursue this project and it is feasible and can permit it and looks like something we can do and want to do. The Municipality is the landowner and goes after the grant monies to build the project then we would basically be the owner or at least a partner so its not that we are looking at we are spending municipal money for a private company to build a project, the Municipality would be a stakeholder of at least 50/50 if not more so any revenue is going to be shared. Manager Sorum indicated that if the Municipality takes the time and effort to secure the grants that the Municipality would be a part owner in it because you wouldn't want to deal with it because ownership gives you control over that part of the power you have control over and the Municipality could say that Skagway uses this much power, we don't want our power shipped over to somewhere for diesel generation or we want our power to plug in a cruise ship. He indicated he thinks it backs up to whether the project is feasible and it will pay for itself and AP&T has run into issues where they have financed hydro projects and not gotten the State support for them that other projects have gotten and with the AEA renewable energy fund we have an opportunity to get grant funds to put major capital bucks into projects where that opportunity hasn't existed before. If the project is feasible and can be permitted that's the first step and we aren't going to do any of that unless we get grant funding from the State to do that. He indicated he doesn't see the Borough pursuing construction of the project unless it's proven feasible and we also get enough grant funding to build it, he doesn't see the Municipality financing the whole $50 million project. Manager Sorum indicated that the whole idea of the AEA grants is they want to support these sorts of projects and they are going to be putting $50 million per year out to build them and this idea is does the Municipality want to take advantage of this or not. Assemblyman Korsmo indicated that there is not an opportunity for public participation in this and asked Mayor Cochran if it could be opened for comment from the public. Mayor Cochran asked if anyone wished to address the Assembly. No comments were made. MUNICIPALITY OF SKAGWAY, ALASKA SPECIAL ASSEMBLY MEETING September 12, 2008 Page 3 of 5 Mayor Cochran indicated he would like #2 changed to insert "Municipal ownership on both sides of the West Creek River". There was no objection from the Assembly. Motion passed by roll call vote of those present. Communications to the Assembly: Mayor and Assembly Discussion Items: Assemblyman Korsmo displayed the artwork from Peter Luccetti that he would be taking to the Southeast Conference as the silent auction item from Skagway and indicated that Mr. Luccetti was willing to let it go for $500.00 but it was worth considerably more then that and the Manager will be taking it to the conference with him since he is driving. Assemblyman Korsmo also indicated he just got notified that he was reappointed to the Governor's transportation committee. Assemblywoman Hisman indicated she brought up an issue that was weighing on her that has to do with a benefit that was enacted with the new fiscal year July 1 and use of the Rec. Center. Municipal employees and assembly members could use the Rec. Center and their families could get 50% off. She indicated she didn't believe that it really met a standard of being out for the public comment and believes that the public deserves an opportunity to comment on that. She indicated she was trying to come up with a way that could happen and felt the only way was to make sure that benefit absolutely lapsed with the new budget cycle and if people felt strongly about it they could bring it forward again and let the public comment on whether they felt that was something that they wanted us to do. Mayor Cochran asked if that ever came before the Assembly. Assemblyman Henry indicated no. Manager Sarum indicated that he and Assemblywoman Hisman talked about it and there was tons of conversations about it but looking back he doesn't know that it ever got past Finance. He indicated that he suggested to Assemblywoman Hisman that we make sure we bring it back up in the next budget cycle one way or the other because it's kind of hard to shift right now. He indicated that the other conversation that has to happen is he believes that going into January we need to talk about the health care costs because that's the same thing. By the time we are into the budget cycle it's going to be too late to talk about the insurance policies we are carrying and any of the discussions about co -pay or coverage so this is in the same boat. Does it benefit the employees, in the long run would it make it a more productive work force, does it lower the costs for care but the other thing is we have to jump on the health benefit stuff early rather then wait for the fiscal year to end. Assemblywoman Hisman indicated that in all the emails she could get together it seemed that the only discussions that happened were between people that would benefit from this policy change and if nobody from the outside comments then it really could look like we are just doing ourselves a favor and that's not right. Assemblyman Korsmo indicated he went to a Rec. Board meeting and they will be preparing some other exemption proposals for the Assembly to consider, they spoke about this and are looking at seniors also. He indicated that revisiting this shouldn't be a shock to anybody; he doesn't believe that anyone is at fault it's just something that happened. He also indicated that MUNICIPALITY OF SKAGWAY. ALASKA SPECIAL ASSEMBLY MEETING September 12, 2008 Page 4 of 5 there was information that came by the Assembly but if you weren't paying close attention you could have missed it. Manager Sorum indicated that he remembers they punched it into the budget but it didn't get talked about during the budget, there were talks about what it should it look like, what would it cost and what should we do and it got stuck in there and that was the end of it. Mayor Cochran indicated he agreed with Assemblywoman Hisman and the Assembly should fix it. Assemblyman Hunz indicated it was brought up to him that as a tax payer why are they having to pay their taxes and also have to pay for the Rec. Center when other people get to use it for free. When the Rec. Center was set up the idea was that the Municipality was going to supplement it a little bit with tax dollars and try to raise the money itself but looking at the budget and the amount of money put into the Rec. Center and certain people are getting to use it for free and others are getting put out because they are having to pay for it. He indicated it came to his attention when he received a card saying that he could join for free. Assemblyman Korsmo indicated that the Rec. Board's intention is with different issues that groups have brought up for possible exemptions, the Rec. Board itself has always maintained Rec. Center fees across the board because of that. He indicated that the Rec. Board did not weigh in on this issue at all. Manager Sorum pointed out that he had this discussion with the Rec. Center Board and it's beyond their powers. Assemblyman Korsmo indicated he knows it's beyond their purview but at the same time they at least need to know about it because they get questions just like the Assembly does and they need to be aware even if it's not a policy decision that they make. Assemblywoman Hisman asked if the Assembly is going to do anything about it or put it on the next fiscal cycle. Manager Sorum indicated if the Assembly tells staff to bring it forward as a discrete component of the budget so the Assembly can yea or nay it. He indicated that he was hoping when he was talking with Assemblywoman Hisman that we would get it on the record and bring it back up and treat it separately. Assemblywoman Hisman indicated she would like to see it sunset and then the Assembly can say we will not do it and then bring it forward for consideration. Assemblyman Korsmo indicated that right now he thinks the Rec. Center is set up to deal with it. Manager Sorum clarified that Assemblywoman Hisman wants to let it drop and then for the next fiscal year bring it back up? Assemblywoman Hisman indicated that if people want to bring it back up for the next fiscal year we can discuss it, Manager Sorum indicated you would drop it for a year, Assemblyman Korsmo indicated no we leave it in place. Manager Sorum indicated that's not what Assemblywoman Hisman is saying. Assemblywoman Hisman indicated she is saying that it ends unless it is adopted for our next budget cycle. MUNICIPALITY OF SKAGWAY, ALASKA SPECIAL ASSEMBLY MEETING September 12, 2008 Page 5 of 5 Manager Sorum indicated he can bring it forward as a separate subject in the budget and you can vote it up or down. But the way I'm listening to you it almost sounds like you want it to end on July 1. Assemblywoman Hisman indicated yes unless it is okayed for the next budget cycle. Manager Sorum indicated he would bring it forward as a specific single item so when the Assembly goes through the budget. Assemblywoman Hisman indicated she thinks that is where it happened when the Assembly was going through the Rec. Center budget meetings it never was talked about as a separate issue. 7. Adjournment: Motion/Second: HenrylKorsmo To adjourn the meeting of September 12, 2008 at 5:43 p.m. Motion passed unanimously by voice vote. Thomas D. Cochran, Mayor ATTEST: Marjorie D. Harris, Borough Clerk (SEAL) Approved: October 2, 2008 CITY OF SRP_GWAY ADL 105276 FINDING AND DECISION PROPOSED MUNICIPAL LAND CONVEYANCE APPROVED IN PART, DISAPPROVED IN PART AS 29.65 I. PROPOSED ACTION This decision proposes to approve and convey management authority for approximately 7,376 acres of tentatively approved state land to the City of Skagway in fulfillment of their 7,489 acre municipal entitlement. This decision also disapproves 1,144 acres of city selections: 144 acres are disapproved because of high public interest values and 1,000 acres are disapproved because they have been designated by the legislature as Mental Health Trust lands. Approximately 229 acres selected by the city will ,remain in selected status until surveys are performed by the city. II. AUTHORITY AS 29.65.020 and AS 38.05.035(e). The director has delegated to the chief of Resource Assessment & Development Section the authority to approve proposed and final decisions for the two referenced statutes. III. A➢MINISTRATIVE RECORD ADL 105276 constitutes the casefile for this decision. Other actions of record include: (1) Haines-Skagway Area Land Use Plan (HSAP), including amendments that accompany this decision, and (2) Skagway Coastal Management Program, which includes the Port of Skagway and Skagway River Area Meriting Special Attention. Adjudication. procedures specified by the division procedures manual were used. IV. LOCATION Skagway, a first class city, was incorporated June 6, 1900 and contains 443 square miles within the boundary. Located 90 miles north of Juneau at the head of Lynn Canal and Taiya Inlet, Skagway is connected by the Alaska Marine Highway and the Klondike Highway which leads north into Canada. Skagway is bordered by the Haines Borough on the south and west and federally owned U.S. Forest Service land to the south and east. The state land which the city made their selections from is within USS 5110, lying north, west and east of the city. V. LEGAL DESCRIPTION Attachment A (four pages) describes the land proposed for conveyance to the city. This attachment provides within each section of the various townships and ranges the (1) land description, (2) acres in each classification, (3) acres within the Page 1 of 13 Klondike Gold Rush .National Historical Park (KGRNP), (4) proposed reclassification, (5) whether the land is vacant, unappropriated and unreserved (VUU) and (6) reservations. The reservation letters are described at the bottom of Attachment A. The land described in Attachment A contains approximately 7,376 acres or 113 acres short of the 7,489 acre entitlement. Acreage calculations were derived from the use of a planimeter on enlarged state status plats. U.S. Geological Survey quarter -quarter quads dated 1991 based on 1982 aerial photography were also used in the Dyea area since they represent a more accurate representation of the true mean high water line which is erroneous on the 1" = 1 mile USGS quads. Additionally, the Taiya River, using 1992 aerial photography, was scaled and superimposed on the state status plat. Major shifts in the river boundary have occurred since the early U.S. Surveys were established in the Dyea valley. Since the Final Decision will pass management authority to the city for this land and because this land is unsurveyed, the true acreage will not be known until the decisioned land is eventually surveyed. To prevent passing management authority to the city for acreage greater than the entitlement, Attachment A describes 7,376 acres. The city prioritized (below) their remaining entitlement in roughly 40 acre aliquot parts. The 229 acres below is listed in the priority which the city requested_ All of this land will remain in selected status. When the city completes the surveys for the 7,376 acres, the Final Decision will be amended without additional public notice to include the parcels by priority until the 7,489 acre entitlement is reached. The selected land contains approximately 229 acres or 116 acres in excess of the 7,499 acre entitlement. This extra acreage allows for any shortage determined by surveys and is well within the allowable 110% overselection. The following land, within Section 10 and 11, T_ 27 S., R. 59 E., CRM is classified Public Recreation Land, is VUU, and is within the KGRNP. PRIORITY SECTION DESCRIPTION ACRES 1 10 SE1/4NE1/4 36 2 11 SW1/4NW1/4 39 3 11 SE1/4NE1/4 40 4 11 NW1/419E1/4 40 5 11 NW1/4NW1/4 36 6 10 NEl/41NE1/4 38 Total +/-229 The land would be subject to Reservations B, H, L, and M as described at the bottom of Page 4, Attachment A. Page 2 of 13 VI. TITLE Acquired under Statehood Act entitlement as General Grant land (GS 837). BLM has conveyed to the state by Tentative Approval various lands in the Skagway area during the past 30 years_ The land from which the city filed their selections is within Lot 5, USS 5110. These lands were conveyed August 16, 1974 and -April 12, 1995. The later conveyance was 185 acres w thin P©uervrpriaject 1Q51 e _, art area excluded from the 1974 conveyance. Thlands to be decisioned to the city would be surveyed to the present Mean High Water line. VII. BACKGROUND The City of Skagway was certified a 500 acre entitlement in 1978. The casefiles referenced below su_*nmarize the 1978 entitlement. ADL 101076 Tract A & B, ASLS 81-43 (North of Yakutania point) containing 156.9 acres. Management authority by city, need federal patent before issuing state patent. Various lots within USS 3312 containing 113.05 acres, state patent #7439. ADL 101629 Tracts A, B, C & D, ASLS 81-147 (West Creek) containing 98.8 acres. Management authority by city, need federal patent before issuing state patent. ADL 101675 Tracts A & B, ASLS 81-146 (West Creek) containing 109.8 acres. Management authority by city, need federal patent before issuing state patent. -ADL 102333 Several lots within USS 3312 containing 9.0 acres, Quit Claim Deed 514 issued. These four casefiles have conveyed management authority or title -to 487.6 acres. Legislative changes in 1988 to AS 29.65 resulted in the city receiving an additional land entitlement of 7;477 acres. The remainder of their 1978 entitlement (12 acres) plus the 1988 entitlement gives the city 7,489 acres of remaining entitlement. The city is allowed to select up to 110% of their entitlement, In the fall of 1989 the city submitted an application for 8,095 acres. For various reasons the process to decision this land to the city was delayed. In 1994, to help resolve the litigation over the mental health lands, approximately 1,000 acres of city selected lands were identified to replace mental health lands conveyed from state ownership. These 1,000 acres, described in XII, are now Mental Health Trust Land designated as Trust land under Chapter 5, FSSLA 1994, and as amended by Chapter 1, SSSLA 1994. The city was asked to select additional land to replace the 1,000 acres. In December of 1994 and January of 1995 the city selected several isolated parcels, to help consolidate land patterns, and asked for additional land in West Creek and along Taiya River. Page 3 of 13 VIII. PLANNING AND CLASSIFICATION Land Management Plan/Classification The state land involved with this decision is covered by the Haines-Skagway Area Land Use Plan approved by the commissioner on June 8, 1979. The lands were classified on June 26, 1979 with several amendments in later years. The Haines-Skagway Area Land Use Plan (HSAP) will require amendments in order for this land to be transferred to the City of Skagway. A draft amendment and the reclassification request is a separate document advertised jointly with this proposed decision. The classifications of the selected parcels are shown on Attachment A. For the purposes of municipal selections, AS 29.65.130(10)(C) and (D) describes "vacant, unappropriated, unreserved land" (VUU) as unclassified or classified for agricultural, grazing, material, public recreation, or settlement or was classified no earlier than September 1, 1983 as resource management and is still classified resource management. Selected land and accompanying classification which are not VUU are listed below. Water Resources Land 1,744 acres Reserved Use Land 301 acres Resource Management Land 898 acres Resource Assessment Land 32 acres Total 2,975 acres All of the above lands are proposed to be reclassified to Public Recreation Land so they would be available for conveyance to the city. The classifications have no effect on uses of the land after the city receives land management authority; land use is there after typically controlled by zoning and other local ordinances. Available, developable land is limited in this community due to topography. The availability is compounded by the 1,000 acres lost to Mental Health. To facilitate a land base which will allow the city multiple management options in the future, a reclassification is necessary. To reclassify the land, the HSAP must be amended. Additionally, the HSAP has .a general guideline which states there will be a special management zone 200 feet wide on state land on either side of the banks of all fish streams. The amendment proposes to reduce the overall width from 400 feet to 100 feet (50 feet each side of the stream). The 100 foot width would still provide habitat protection while allowing the city to own and manage land with less restrictive title. Alaska Coastal Management Plan The City of Skagway prepared the Skagway Coastal Management Program, which includes the Port of Skagway and-Skagway River Area Meriting Special Attention (AMSA). The plan and the AMSA's have been adopted by the State of Alaska. A land conveyance is a transfer of title and has no effect on the coastal natural resources, therefore a consistency review is not Page 4 of 13 necessary. The Division of Governmental Coordination has added to the A -List (Categorically Consistent Approvals) a grant of municipal entitlement land. Addition to the A -List eliminates the need for a consistency review. Subsequent actions by the city may require a project consistency review. Mineral .Closing Mineral Closing Order 78 is in effect for the three residential lots within ASLS 79-183 selected by the city. This closure was implemented prior to the land disposal to prevent the filing of mining 'claims. Mineral Closing Order 512 is in effect for ILMA 103245 covering 105 acres at Sheep Camp. No other areas of city selected land are closed to mineral entry nor are any areas proposed for mineral closure. Zoning The city has zoned the areas of city selected land as Residential Conservation zone (RC). IX. DECLARATION OF PUBLIC AND/OR NAVIGABLE WATERS For purposes of this decision, the definition of a "waterbody" is any natural, well-defined body of water such as a lake or pond. The definition of a "watercourse" is any natural, well-defined stream, creek or channel, produced wholly or in part by a definite flow of water, whether continuous or intermittent. The criteria below defines Chargeable and Non Chargeable Acreage- 1. Criteria Used for Navi able Submerged Acreage - Non Chargeable) A. The fee interest in .the submerged lands beneath waterbodies and watercourses determined by DNR to be navigable will be retained by DNR. The City's acreage entitlement will not be reduced by the acreage of this submerged land. The adjacent uplands conveyed to the City will be subject to a 50-foot-wide easements to and along the ordinary high water ("OHT9") mark, as required by AS 38.05.127, B. Waterbodies 50 acres or more in size from OHW to OFt7, and watercourses 50 feet or wider from OHW to OHW, are to be considered navigable waters, unless previously determined otherwise by BLM, DNR or a court of competent jurisdiction. 2. Criteria Used for Public Submerged Acreage - (Chargeable A. The fee interest in the submerged lands beneath waterbodies and watercourses determined by DNR to be public but not navigable will be conveyed to the City, and the City's acreage entitlement will be reduced by the acreage of this submerged land. The adjacent uplands conveyed to the City will be subject to 50-foot-wide easements to and along the OHW as required by AS 38.05.127. B. Waterbodies of 10 acres or more in size but less than 50 acres in size from OHW to OHW, a -rid watercourses 10 feet or more -in width but less than 50 feet wide from op.w to OHW, are to be considered Page 5 of 13 public waters unless previously determined otherwise by BLM, DNR or a court of competent jurisdiction. A. The fee interest in the submerged lands beneath waterbodies and watercourses determined by DNR to be neither navigable nor public will be conveyed to the City, and the City's acreage entitlement will be reduced by the acreage of the submerged land. The adjacent uplands conveyed to the City will not be subject to public easement reservations to and along the OHW. B. Waterbodies less than 10 acres in size from OHW to OHW, and watercourses less than 10 feet wide from OHW to OHW, are to be considered as neither navigable nor public waters, unless previously determined otherwise by BLM, DDTR or a court of competent jurisdiction. Pursuant to AS 38.05.127 the following waters are determined to be navigable and are subject to a 50-foot-wide easement to and along the OHW mark: 1. Skagway River 2. Taiya River Pursuant to AS 38.05.127 the following waters are determined to be public and are subject to a 50-foot-wide easement to and along the OHW mark: 1. West Creek 2. Upper Dewey Lake 3. Lower Dewey Lake In addition to the public and navigable waters listed above the following watercourses are subject to a 50-foot-wide fish and wildlife habitat protection easement landward from the OHW mark for the anadromOus streams listed and identified on Attachm—ent C_ Tn some instances, this habitat protection easement may overlap another public or navigable 50-foot-wide easement. These streams are from the 1994 ADF&G Anadromous Stream Catalog, revised 10/24/94 and effective 4/28/95, and shown on U.S.G.S. Quad Skagway B-1 and C-1. Taiva River Drainage 1. 115-34-10230 Taiya River 2, 115-34-10230-2006 3. 115-34-10230-2009 West Creek 4. 115-34-10230-2010 5. 115-34-10230-2011 Nelson Creek Page 6 of 13 Skagway River Drainage 6. 115-34-10300 Skagway River 7. 115-34-10300-2020 8. 115-34-10300-2022 9. 115-34-10300-2031 X. PUBLIC. ACCESS AM RESERVATIONS The land proposed for conveyance is subject to: * All valid existing rights and reservations, if any, but not limited to those herein listed. * Reservation of perpetual public easements, as required by AS 38.05.127(a) and regulations implementing that statute, to and along navigable and public water, as those terms are defined in AS 38.05.965(12) and (16) which are determined to be reasonable necessary to insure free public access. An easement for public access is reserved 50 feet upland of the mean high water line along any waterbody affected by tidal action. * The State of Alaska reserves unto itself all tide, submerged, and shorelands and land underlying public or navigable waters, to which it has received or will receive tentative approval, patent or title by operation of law, and the effect of said reservation is reflected, insofar as possible in the acreage approved for conveyance. * The State of Alaska, as required by AS 38.05.125, expressly saves, excepts and reserves out of the grant those resources specified by statute. These include but are not limited to all oils, gases, coal, ores, minerals, fissionable materials, geothermal resources, and fossils of every name, kind or description, including the right to explore the same. * A right-of-way thereon for ditches or canals constructed by the authority of the United States Act of August 30, 1890, 26 Star_. 391, 43 U.S.C. 945. * A 50-foot-wide public or navigable access easement or fish and wildlife habitat protection easement for those water courses listed under IX. * Reservations as defined at the bottom of Attachment P_ XI. 1RESPASS Some lands conveyed may be subject to unauthorized use. The State has researched its land records and finds no uses authorized_ No provisions will be made in this conveyance nor should any provision_ of this decision be interpreted to apply to any unauthorized use. Page 7 of 13 As discussed under VII, approximately 1,000 acres of city selected land is Mental Heal.'th Trust Land designated as Trust land under Chapter 5, FSSLA 1994, and as amended by Chapter 1, SSSLA 1994. This land is not available for conveyance to the city and is hereby disapproved. The city has selected additional land to compensate for the loss. Those lands disapproved are: MH ID # LEGAL DESCRIPTION ACREAGE C20446 T. 27 S., R. 59 E., Sec. 35 315.0 C20447 T. 27 S., R. 59 E., Sec. 36 190.0 C70448 T. 27 S., R. 60 E., Sec. 3.0 200.0 C20450.003 T. 27 S., R. 60 E., Sec. 31 10.0 C20456.002 T. 28 S., R. 59 E., Sec. 2 225:0 C20462.002 T. 28 S., R. 59 E., Sec. 12 60.0 Total 1000.0 Parcels C70448 and C20450.003 contain a total of 435 acres while the city selected_ portion of these two parcels is 210 acres. Attachment B depicts the areas of. Trust land disapproved. XIII. DISAPPROVAL OF CITY SELECTED LAND Land in two locations, Sheep Camp and the campground/ranger station near the trail head, are proposed for disapproval. Land management authority for 105 acres at Sheep Camp has been transferred from the Div. of Land to the Div. of Parks and Outdoor Recreation by ADL 103245. Sheep Camp is a camping and gathering point for hikers before ascending the pass. No other campsites are located between Sheep Camp and the pass. The National Park Service (NPS) through a Memorandum Of Understanding approved 12/20/89 by the Department of Natural Resources (DNR) manages the Chilkoot Trail and several key sites along the trail. Improvements at Sheep Camp consist of a public cabin/shelter, ranger cabin and tent frames, food cache, latrines, and camp sites. This is the main NPS base camp and serves as the communication link with Park Canada employees. The second area proposed for disapproval is 39 acres encompassing the small public campground, ranger station and cabins for seasonal housing, trail head parking and interpretive signing. Management authority for a portion of this area was transferred to the Division of Parks and Outdoor Recreation by the same agreement, ADL 103245. Additionally, the NPS purchased U.S.S. 1249. Since the survey in 1918, the Taiya River has shifted dramatically to the west. It is likely that a portion of this survey lies .to the east of Taiya River, near the campground. The NPS has never resurveyed their land boundaries to verify whether the survey is now separated by the Taiya River. AS 29.65.050(c) allows the director to disapprove a selection upon a 'finding that the public interest in retaining state ownership of Page 8 of 13 the land outweighs the municipality's interest in obtaining the land. Due to the nature of improvements, the public use and values, and location, the public interest in retaining state ownership of this 144 acres outweighs the municipality's interest in obtaining the land. The 105 acres .at Sheep Camp are within T. 25 S., R. 60 E., CRM., Section 31, classified Reserved Use, and described as NW1/4SE114, W1/2NE1/4SE1/4, SW1/4NE1/4, SW1/4SE1/4NE1/4. The campground lands are within T. 27 S., R. 59 E., CRM'., classified Public Recreation Land, with 18 acres inside the KGRNP and 21 acres outside. The lands are within the SE1/4 of Section 22 and the NE1/4NE1/4 of Section 27 lying east of the Taiya River and west of the Dyea Road. Attachment B and D depict the 144 acres proposed for disapproval. XIV. SURVEY AND APPRAISAL After the Finding and Decision, the borough will be responsible at their expense to have the parcels surveyed if the cadastral survey section determines the parcels to be unsurveyed after BLM issues a federal patent. No appraisal is necessary for an AS 29.65 conveyance since the land is conveyed without charge. XV. AGENCY COMMENTS An agency review was concluded April 3, 1995. The Div. of Parks and Outdoor Recreation, SE Regional. Office was the only agency which submitted written comments. Those comments from Bill Garry, Area Superintendent, resulted in several meetings to discuss various issues of ownership and management. The consensus was to retain ownership of Sheep Camp and the small campground and ranger station complex near the trail head. Reservation of a 300' trail easement was also agreed upon which is consistent with the management right presently granted to the Div. of Parks and Outdoor Recreation. XVI. ENVIRONMENTAL RISK The transfer of land ownership from BLM to the State occurred primarily in 1974 with a small conveyance in 1995. Practically speaking, there is no way to inspect all of the city selected land nor any way to verify what contamination, if any, occurred during the past 100 years when the population boomed during the gold rush of 1898. The area most likely to contain contamination would be along the railroad tracks. Concentrated minerals brought to Skagway via railroad from the Yukon resulted in spillage over the years. A consent decree, issued by the Department of Environmental (DEC) ?age 9 of 13 directed several companies to remove contaminated soil. This cleanup was completed in 1988. Another possible source of contamination could be the four inch fuel pipeline built by.the military in the 1940's. This pipeline, above and below ground, parallels the railroad to Whitehorse. Over the years, equipment and ruptures have discharged fuel in a number of places. The pipeline is currently not in use and may either be salvaged or upgraded and placed back in use. Given the nature of the course rock and gravel used in the railroad bed, fuel and other contaminants readily leave the surface. Some fuel has been captured but most enters the fill and substrate. A visual inspection would likely not reveal any contamination since the contaminates would be below the surface. An or. -site analysis has not been conducted to determine to what extent any contaminants may exist. A Phase I Environmental Audit has not been conducted for any of the city selected land. Phase I is a visual inspection to detect evidence of toxic and/or hazardous substances/wastes or petroleum products. The Bureau of Land Management and the State of Alaska are potential responsible parties (PRP) involving the cleanup of contaminated sites on state land which occurred prior to city ownership as well as any individual or company who may have allowed the contamination to occur. Likewise, the City accepts liability as a PRP when land management authority is passed from the state. Given the nature of potential contamination and minimal threat to public health, a Phase I Environmental Audit is not recommended. XVII. ALTERNATIVES The alternatives which exist to the city revolve around the availability of state land. The 1978 entitlement of 500 acres has been decisioned and is primarily located along the northern side of West Creek and north of Yakutania Point. The NPS objected in 1980 to a proposed city selection of 155 acres within the park. The parcel was adjoining the Taiya River and West .Creek near their confluence. Due to other available lands, the parcel was denied. The city went through an extensive public process in 1988 to select their additional entitlement. The city submitted an application for the full entitlement, including approximately 885 acres within the KGP.NP. To replace selected land conveyed to the Mental Health Trust, in 1995 the city selected several small parcels to assist land management patterns and requested 425 additional acres in the West Creek valley and the remainder within the KGRNP. The Klondike Gold Rush National Historic Park was established by the 94th Congress on June 30, 1976 as Public Law 94-323. One purpose of the park is to preserve in public ownership for the benefit and inspiration of the people of the United States, historic structures and trails associated with the 1898 gold rush. Although the park represents a national interest, the state acquired its land prior to formation of the park, and under state Page 10 of 13 law the city can select land within the park. The state proposes to retain two key access and public use sites (the lands disapproved in Section XIII of this decision) and will retain a 300 foot reservation for the Chilkoot Trail where it crosses the land proposed for conveyance to the City. Of the 1,253 acres of city.selected land inside the KGRNP (901 for conveyance, 123 for disapproval, and 229 remaining as selected), 857 acres are classified Public. Recreation; these lands are VW .. The Land Protection Plan prepared by the NPS and approved 4/3/91 discusses city selections. This plan states that when the city acquires state land within the park, the NPS will work with them to assure compatible uses or will negotiate for acquisition of these lands. The State owns 10,200 acres within the park boundary with 8,570 acres being along the Chilkoot trail corridor. The proposed conveyance would result in 9-11% of the state land being conveyed to the city. The city's request for the various areas selected and proposed for conveyance is appropriate. The state land base from which the city_ must select their entitlement leaves limited alternatives. XVIII. RECOMMENDATIONS The Southeast Regional Office of the Division of Land recommends conveyance of 7376 acres, subject to the following conditions: 1. As specified by AS 29.65.050(c), before the Finding and Decision is affirmed the Department of Community and Regional Affairs shall review the selection and recommend approval or disapproval. 2. Land management authority shall be granted when the appeal period ends following approval of the Finding and Decision. Land cannot be relinquished after this occurs. After management authority occurs and before patent to the city, the city will be authorized to execute conditional leases and make conditional sales on all lands under this conveyance (AS 29.65.070(b)). 4 The land described in this decision shall be subject to those items referenced under X. PUBLIC ACCESS AND RESERVATIONS and IX. DECLARATION OF PUBLIC MW OR NAVIGABLE WATERS. 5. Attachment A referenced under V. LEGAL DESCRIPTION constitutes the selected and decisioned acreage. Section V. also describes the remaining, prioritized land which will remain in selected status. As surveys are completed, the Final Decision will be amended without additional public notice to include additional land until the full land entitlement is reached. 6_ The City shall be responsible to survey the land to DNR standards if the land is not conveyable to the City as conveyed by federal patent. Page 11 of 13 7. No _portion of this land can be used for the purposes of a solid waste site, storage of hazardous waste or incinerated ash disposal until the land has been surveyed and a state patent issued. 8. Prior to the Final Finding and Decision, the Commissioner must approve an amendment and reclassification of the Haines-Skagway Area Land Use Plan for those parcels which are not "vacant, unappropriated, unreserved land". 9. The State reserves the right to adjudicate and grant PST #592, an R5 2477 application for the Chilkoot Trail. 10. This decision does notprevent the City from filing an application for land under House Bill 79 passed by the 1995 legislative session. Any land conveyed by HB 79 will be charged against the city land entitlement: Approximate acreage expected to be applied for under this bill is five acres. 11. Disapproval of 1,000 acres of land described in XII. DISAPPROVAL OF CITY SELECTED LAND DESIGNATED MENTAL HEALTH TRUST LAND. 12. Disapproval of 144 acres at Sheep Camp and the campground area as described in XIII. DISAPPROVAL OF CITY SELECTED LAND. XIX. PRELIMINARY FINDING AND DECISION The recommendations presented above has been reviewed and considered. I find that the proposed action may be in the State's Best Interest and is hereby approved to proceed to public notice. - Approval Recommended Ron Schonenbach, SE Regional Land Manager Da e Approval .� ffkL/Gl�� Date Ri hard H. Iyliu- hief Resource Development & Assessment Unit PUBLIC NOTICE FINAL DECISION AND APPEAL PROCEDURES: A public notice announcing this preliminary decision and soliciting comments will be published in the Skagway and Juneau newspapers in accordance with AS 38.05.945(b). Notice will also be given to the City of Skagway per AS 38.05.945(c)(1). In addition the Skagway Post office will be requested to post the notice in accordance with AS 38.05.945(b((2) and the notice will appear in the Alaska Page 12 of 13 Administrative Journal. The public is invited to comment on this preliminary decision. Any comments must he received in writing by the Division of Land at 400 Willoughby Ave., Suite 400, Juneau, Alaska 99801 by August 14, 1995 in order to ensure consideration (please include mailing address and a telephone contact). All persons interested in this decision and -in establishing their appeal rights, are now required by law to .meaningfully participate in the decision process by commenting on the decision, in writing by the above deadline. Following the comment deadline, all written responses will be considered and this decision may be modified to incorporate public comment. If public comment in response to this notice indicates the need for significant changes in the decision, additional public notice will be given on or about Seotember 1. 1995.If no significant change is required, the preliminary decision, including any minor changes, will be issued as the final decision. A copy of .the final decision including instructions on filing an appeal will be sent to any person who comments on .the preliminary decision. Persons who do not submit written comment during the comment period will have no legal right to appeal the final decision. Attachment A - Legal Description of Land Proposed for Conveyance Attachment B - Status Plats Showing Land Proposed for Conveyance, Rejection & Denial Attachment C - Anadromous Fish Streams Attachment D - USGS Quads Showing Land Proposed for Conveyance L Denial Page 13 of 13 C O Z g N J LL1 m m W C J is c cc cccc .0 J J .m m m M .ml J 0 cc J N N O O O 0 0 0 0 C C O C U N N N - m Q3 a)Ncc m CC cc fr cc M It U N 0 .2.2.2 U m m m= m m c-' -0 m z ma :a M Z C E C c C .f} c a` 3 a tea', as-0-(L zzz° z za z a lo 0 0 0 0 0 0 M ami m 0 aNi w o> zz zzzz > y>Iz } �z z c I .E .E v ac a . m J 9 .m a C Elm N N m N 0 to N N N c ND m- m m m m ., m "N U U y Q m m U Q G1 . Q Y 2 a Q C 0 N N 0 0 0 0Ln Y to c N `1 m O o I � 0 o 0 of O O 0 O 0 O o I N v O l � N o O of O o O o�0 C, . P 0 O 0 10 tI mrn 1c, vo)co CO N LLo co 7 co � I 1�f1 � co ami In U Q O Q � r S to 0 r W rr�g j 'i e m m C W N R CL U] J m a N a CT. coCC m m -0 Z Y Y m m J pQ L C ` '0 ¢� N Z O U [3 t- co O a C p X 7 p N tt5 -O 0.� W� 0 Y m -0-0 m ai U �,?? o M �"iw C6� rn N Ul m 6zw U U ii C 7 iL () % m N U U �_ :N .N N _ 3 J� m d)� t` r N C J Q N .N m - U N C N C W X0 W C LL W N U Ud, UC/7nJ�CO cn N U N O ma ON 7 co CA N V 7r DQ co J N�� N Cm'7Nrcli C ca co W W' m c�¢<,- moT c 'z`tJ� tO �.E U N o _wcnm_ �� m``W 2c`n�zw m um� ' m m fn QCf ON , Nn cq Cl) cC]J Um*U '^ Cd 0 N U J�U C- U 0 Cl)1--1� US uT Cn [n co co uI U7 co U CO CD J t-�cnl 9- M to a C (D E m .c LU Q to O ao ,V r C J 7 � a m cm m U) c O N �U m CJ V c as or c a c LL a m N O a 0 a c m E t U n1 i N 0 ca LP J Id m C7UU LL S S LL C7 m Q c] a] m m m m .2S tti m m m m c 0 a -ca � b a 0 0 0 0 0 C U , m .m m [E O 'O N a0] N m 0 N N U N¢ ccccm mod¢ 0.2 p U U Z U z U _Q U .0 U . c: C C C U ME= C 'Z aan zzzz ° a.a n- a-L zCz z z aL z Do °oo o°° aim m m I}: mm m I aNi o m >z zzz zzZ }} } }} } } z } v p J _ I C J J 0 J . J J J _ 1 J J M N N J N 0 M N c c C C C C C c m m m m J m O 0 O O O O O ° m Nm C 7 � O m C ° N mC m m N N m .J ca m m -a m m m m m m m d U cmC CC 2 tC CL m m m CL CC - LC CL CL CL m m 0 `m o 0 `m 0 `m .2 g p o o � o m � 0 .¢ {n m id m is i- m m s i3 n 4 '-' -0 5 3:. 3: C. CL CL. d U) a CL IL fL Ct a cc I C7 Y I Io * u7 v r' Lo CV m v d I r r U Q m O O O 0 O b 0 O O O O O O 10 0 0 0 O O O O 0 0 0 O O O O N 0)i N m m (OD [Op M Lo CJ r In V N 0 t0 O r O V' O O a5 N cD N r co tco o O � Q. L m m tp. m U- - m -m m OL_ m 0 Ci `m Ci m j m> .? N m m =0 -6 m ? gy a`) m 1 ptL ,u -p[CmMMoCCa�co m m U ca a M CL o m~ � cy a o m a i u •N a m a m v m v m N a_ -D 7 a' 7 a 1.... 7- a' F. Y 3 a rNA N B N i O O N U m _ .N . N . 'y N 1 �_ W � m'o� .m m (1) C tx m ca ._ m c ._ cv .— m C U 3 U x a7 o H �LC 1— N� N N N N-O-a._vv._v CL m CL C z C U W U U U U_ U (Nnt11 m N Y La O.:Vl U N U V! uj U U 'y N J U CC C CC "O ;� a a c �` c s c Li � ui a 5)i c ax a m chi ax ax 0 m Y� Y X � m 0 ca T m 5 a1 O co co N O in C"O 0- si--O dMil c4"0 CL p m r.`. ° m r roa 0� N NQ _z--- g;;z C, N �_ =-J(3 m Lr _� Lu �� JC'S m¢ J Ci l5JC7 ACC m w 0 or ' -T m a J 0Y4 - m. 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C �fn 2� Z RM >2Z o �r mr r .0 r W ¢T U ro O U Kl mom? `r C a C _ o O �n� m -0 m cn cacn .4 �� o o n a F - Names a m m m CO c v � ._ m�'a d_ s0- mEL CO m r x U s �V]—J-0J a�Na-to ul I.- j � D -o O `13 vFaJ (�j L W m 0 _i -a ¢•rNis4 d W Vto a3 roW .N _Midi N 0 °1 0 _(/J m= >c v m oi m U CD Q m •- -a cl •- '- I) W. m •tNiJ C U m 0 U }j M C7 -6 en 0 D m U- m0 7 m U m U io m U El: m m .� C t � m U OC _ n m L mF cL l` N U] - m — U G -U CL: T`"a "O � -CT c7 I-• � � LD 73 IL y T- aF CC m Cr.� C m m'6 c� m m m C m c� m G._ m m C!] Cf] 4 arCC m W Cl)Cf] W U)Cri CD m m 4 , Q J ; m 0. dQ m m JC'3 � x ❑ z ZJ.a C--j o v LLI oZrn C m cn r- r a r- C co] r N N' cNV a¢� N m N C M N (D N f� N N- N C n'- T• � L _ m 0 X U X U K U U X v U C _ U •- U U V U K U Y C U U U _ U U' m Q m m m m m m m m m m— '"- m W 0 0 0 m m m m_ M ❑ m _1 m J m M m O CIS a m - � J c zp U c m to 3 C m m 0 — n O p � N m n CD m R U p r m m B Y _ R p] N R } O m m m N C uU U ui N a-Z R 3 � r m I c R J I O NS M1 >Y Eau O L co LO co m R, tit O O _ X co CMJ r Y Cn U •_ mUO1m> — m 1 Y Ci I m m �_ m m 'm E - m t x mj LL fQ N< Iri => m `m c V mLLm v •P axi k O R N C m N t d p I c] _ o Y N O R F- of a U R c m m a 'm Q N Q ca 1-- R J R V U L m I c ai tfi m m p U R 3 o Q R ro RO R - N OCLZ =F pO Q R m to m C o m a R E mC 3R CL o RCop m?pm_ � mL.m zS,ZSCL CO -0� cC13C m � C 2a co co Nzm y(LE LmamOD mLL \ 0 �Ya NM1 ¢ O ' m I j C F— C' ° Cd C R X O,m �CUS L w -x R O mC I Zm p I m Lao __NL 0 6 IaJV�OmO6R m m Z R ` C co m m E m. m _o -QQ O > N ' doOm- 0 Cm C m jL O [[ > U o m R 0 0>` mm -6 m 'O m (v0) m-a I`Zm E m m -DNj m m m 6 J m— C M1c 0m N � Y¢JR O30'R U ¢a Lq pm ZR U U No NCmNO o C � mom-_3EEU XE a m CR ti �L U 'N 2— ' ID O (C . o, 2 Q or mR mO L rnoZ> mCJ ,'. u d.�O_C O i o oCuCm} 0 00 3M1m @ LO eO co o � o NN i •QV. m m p J JmU E m 6 F.•�-' ?.R3� � v20�¢ 0 'D - ? QLU QQ LFUM1•-C �"R6 i'CO7 C7c'j_mnN7mU J'm_� I! - I .'Jm6- mQm0OLU LIC5- 4 OQ V. I A it L E 0 D < ri ZI a Z- Z 44] 44, a 13 0 0 P4 �4 ;H -0 M r E-4 134 �:) U 44 P4 EH 04 FCC .,q Id M 4 > ril 0 0 : A P4 ; _„ !11 0 %n 4-4 C, C11 'd Ln C) H 44 0 A 4j P4 M ;l to jj r'l NN\ Xf, W tl ' U "' 9 '� I � I� I' - .j '� i� l •l l b i l l l l j' I 1 1 I' F; 'aIl- �I I I i i I' I •� �.� !� U w � I I��fi��l I I `I I. I�; i l; I �'" �_ 1 I' I i J `<� U Lf'll II�II!IIIIj �li �nII� 'e 2 p p o a a .� w a a a y A I a 0 H � H H W - b ii li• _ - [v Ga G A G - I _ Y QI .. O -ra IU i. I _� icq Lil IC N Pi 9 ff IN 71, ? �w o — — — --jr } - -- ^ ro '! WEST CREEK HYDRO 2, o. S _ PROJECT I SITE L 1) F4JJ it _ F � 1 LL a r .liliilll 1.�:I..I I I �\4� I I rl W O 0t3 04 a CD a i b LLl N •a � m L N' f VN' 1 a 2W2 a 44 jLIrIap4 TV 4 ''yyyyjj``"41 ' ...:' ": i - ::. y.'.._. ::.F ... i.:'. is f•:- d t - N. I y F 2 ��� /}\ �\^ ©»� '\i \}\\ � %\ )� - � ` , !� (i � � (\ i� \� e\:. ) ]] i g / / NMI! � �\�,� \���i�/ \� � 2. \g \J\'�\§(� L� / \ \ /\ \\i l \ j� \ \[ :ƒ j \ I \ \ c \I�. �r O a i I I Iy�y�xli .I� i l; I i � f$ 151 i i a. a�Il I I O �a_4€ �CIO 7j�.: Uril �r A Z r `7 Q Q O ' ' .(�W HLtJ -7i 'tea - .—..—.---- ---- --. U W b ° z0-1 a W IM w F R'i P4 H O u a a a q1:12 EA - w w A q w 4EL �H H ILLLO & O Itlt ti Ifs m m. i a j°17 r� U q E-I EdE ° aQ �: Wit` — '.(YA lI.YKVN CL aq I O- --- -- - -- -- -... U LL) > El uj 4-4, � y�i„��i"!'II;� l�l �II�III I 1 1 iI I IiI II.!�III �� 0 14 Ld N N I ,�- I ! U rop LU 0 D9 .14 f; Q 04 rj a) I L 0 R go U- �4 0 0 < o -L.Li 0 0 44 1Z Ld Cq < 0 U Ya A4 P4 0 In 0 LO u- to m H- H LU 44 E-q 4 cn M IL —,- _J1 0 -- ----- - -- - -------------- i.;i �•,t r�G i !r 'I1�� ill,. �I� .�'S` i�� 1tY ;ai %f'i�l �� �l'.0 � 9 n ` �'i, "y 115-34-1a23a '•_.S � , 4i' ;!! r (.•. l k ; c" �;:zr. ®%r � '�Iklo ��i .� ,,1 �/ r - ;" 1 / jMAP � zoa9 2oia I il,,:f 'V ��Ji/ i .�'r'/; c• is�-6i s11/1' , . _v . ji I MILE 1:w_l;llcl ' 1 1L!'ir fyil/ 2022Odw- WE f NAQROMOUS STREAM T L ANAORChiOUS WATER$ ARE LISTED PWRSONT 19,4§ ATTACHMENT C - ADL 105276 Proposed Finding Page 1:of 3 Anadramous Fish Streams ATTACHMENT C - ADZ 105276 Proposed Finding Page 2 of 3 I . AnadromouS Fish Streams �Z MAP TITLE ead ' SPAGWAY (B'1) .I L'F', . �y •/`• .: /. f C - � �- --- -- - - _ .. ..COY .:.• P = j '- r ; . .:j % •:.. Rush I .`':.. - I /y �t V� 'r ..d ie - lL I : . �' • r `-4 •_].. mete • � r %! � I i r•: •�' � I _ 'ran' I e' �h F 5 i /, P �r Re nK DY ey3 .T.. . �� iJV �•t� 'r' l Ku10/1 rj eck. d; !CD Nah ' it _ � - �.Y',:`'�'''�' e Jam.•:*-� �Lr ia:` `� p' . e. •pit$, i .�•• .rt � � ' Smuggle �t ''� r„ ..a.. : gi.•s. R Cpu � SJ Q ',� «• a 'ON NALHSinft. Yakuranieol _ , — BMA.-�. • . , i. y poin 44 CATA.ErIG OF WAT. ERS IMpO :TA 3FOR Streem/laka __.,___-_____ - Map sheet Lac. Lang. Legal 115.34.10230 Taiya River SKAGVAY B-1 SKAGVAY C-1 59 37 Z4 135 19 49 C 26S 59EIl 115.34-10230-2006 38 SKAGVAY C-1 59 30 18 59 30 45 135 20 53 135 20 39 C 27S 59E2T 115-34-10230-2009 Vest Creek SKAGVAY C-1 31 36 59 135 18 C 27S 59E22 115.34-10230.2010 31 22 C 273 59E16 SKAGVAY C-1 59 31 47 135 20 30 C 275 59E15 715.34-10230-2011 - 59 31 37 135 19 34 C 27S 59E14 Nelson Creek SKAGVAY 8-1 59 29 58 135 21 7-C'27S 59E27 59 29 56 135 21 44 C 275 59E27 ?skasaay�R0vver SKAGVAY 8-1 59 27 25 135 19 24 C 28S 59E11 59 30 0 135 15 18 C 27S 60E29 1'75-34-70300-2020 SKAGVAY 8-1 59 28 35 135 '17 11 'C 78S 59E 1 59 28 44 135 16 51 C 275 60E31 115-34-10300-2022 SKAGWAY•9-1 59 28 42 135 17 - , -C 27S E3 59 28 49 735 16 57 C 275 6QE31 6C 115-34-10300-2031 SKAGVAY 8-1 59 29 17 - 135 16 31 C 27S 60E-j7 59 29 38 .135 16 20 C 27S 60E30 ATTAC MENT C - ADL 705276. Proposed Finding Page 3 of 3 Anadronous Fish Streams RESUME'S COST WORKSHEET ALASKA Renewable Energy Fund Round 5 1 Gr—Tr,ENERGYAUTHORIrY Project Cost/Benefit Worksheet Please note that some fields might not be applicable for all technologies or all project phases. The level of information detail varies according to phase requirements. 1. Renewable Energy Source The Applicant should demonstrate that the renewable energy resource is available on a sustainable basis. Annual average resource availability. 27 GWH Unit depends on project type (e.g. windspeed, hydropower output, biomasss fuel) 2. Existing Energy Generation and Usage a) Basic configuration (if system is part of the Railbelt' grid, leave this section blank) i. Number of generators/boilers/other 0 (The Project will supply shore power to cruise ships docked in Skagway. The existing AP&T system in Skagway serves residential and commercial loads in Skagway, and does not have the capacity or firm energy to supply power to cruise ships) ii. Rated capacity of generators/boilers/other N/A ill. Generator/boilers/other type N/A iv. Age of generators/boilers/other N/A v. Efficiency of generators/boilers/other N/A b) Annual O&M cost (if system is part of the Railbelt grid, leave this section blank) i. Annual O&M cost for labor N/A ii. Annual O&M cost for non -labor NIA c) Annual electricity production and fuel usage (fill in as applicable) (if system is part of the Railbelt grid, leave this section blank) i. Electricity [kWh] 0 ii. Fuel usage Diesel [gal] N/A Other N/A iii. Peak Load N/A iv. Average Load N/A v. Minimum Load N/A vi. Efficiency N/A vii. Future trends N/A d) Annual heating fuel usage (fill in as applicable) i. Diesel [gal or MMBtu] N/A ii. Electricity [kWh] N/A iii. Propane [gal or MMBtu] N/A 1 The Rai [belt grid connects all customers of Chugach Electric Association, Homer Electric Association, Golden Valley Electric Association, the City of Seward Electric Department, Matanuska Elects is Association an J Anchorage IV] Lin Lap Ii Light and Poorer. RFA AEA12-001 Application Cost Worksheet Page 1 7-1-11 ®ALASKA Renewable Energy Fund Round 5 0-- )ENERGYAUTHORITY Project Cost/Benefit Worksheet iv. Coal [tons or MMBtu] N/A v. Wood [cords, green tons, dry tons] N/A vi. Other N/A a) Proposed renewable capacity 25 MW (Wind, Hydro, Biomass, other) [kW or MMBtu/hr] b) Proposed annual electricity or heat production (fill in as applicable) I. Electricity [kWh] 27,000,000 kWh ii. Heat [MMBtu] c) Proposed annual fuel usage (fill in as applicable) i. Propane [gal or MMBtu] ii. Coal [tons or MMBtu] iii. Wood [cords, green tons, dry tons] iv. Other a) Total capital cost of new system $126,520,000 (Phases IV) b) Development cost $8,580,000 (Phases I, II, and III) c) Annual O&M cost of new system $1,500,000 d) Annual fuel cost $0 5. Project Benefits a) Amount of fuel displaced for I. Electricity 1.9 million gallons/year, 93 million gallons over minimum 50 year Project life ii. Heat iii. Transportation b) Current price of displaced fuel $3.88/gallon est. future price for diesel fue12 c) Other economic benefits Estimated 50-year undiscounted economic benefits are: • For cruise lines - - $165,000,000 • For Skagway & State - - $268,000,000 d) Alaska public benefits Economic benefits for Skagway and the State as indicated above: Indirect benefits from reducing environmental impacts and maintaining healthy 2 Attached is a table from the Black & Veech Fuel Advisory Work Group for the Southeast Alaska Integrated Resource Plan calculating changing costs for fossil fuels in Alaska over the next 50 years. RFAAEAI2-001 Application Cost Worksheet Page 2 7-1-11 ME: >ALASKA Renewable Energy Fund Round 5 @EJENERGYAITHORITY Project Cost/Benefit Worksheet tourist/cruise industry 6. Power Purchase/Sales Price a) Price for power purchase/sale To be determined (approx. $0.252/kWh min 7. Project Analysis a) Basic Economic Analysis Project benefit/cost ratio For Skagway, 1.92 with 80% grant funding of construction cost For State, 2.06 with 80% grant funding of construction cost Non -discounted values based on 50/50 sharina of net revenues Payback (years) Not calculated RFA AEA12-001 Application Cost Worksheet Page 3 7-1-11 !W lEfBr§§!§i!§]];Z];;;)§;;;;;;;;;l;l; (!2ut9 . WEST CREEK HYDROELECTRIC PROJECT ECONOMIC ANALYSIS SUMMARY OF COSTS AND BENEFITS Discount Rate 0.0% 12.0% Net Present Value of Cruise Line Savings with West Creek $ 343,795,000 $ 16,714,000 Net Present Value of Skagway Costs with West Creek Debt Service $ 61,025,000 $ 16,386,000 O&M 190,096,000 19,344,000 Total $ 251,121,000 $ 35,730,000 Net Present Value of Skagway Net Revenue with West Creek Net Revenue $ 231,009,000 $ 18,419,000 B/C for Skagway 1.92 1.52 Net Present Value of AEA Costs with West Creek Grant Funding Total $ 112,000,000 $ 112,000,000 Net Present Value of AEA Net Revenue with West Creek Net Revenue $ 231,009,000 $ 18,419,000 B/C for AEA 2.06 0.16 GRANT BUDGET FORM C L 0 LL V ca e lC L U 0 0 0 0 0 0 O o 0 0 0 0 0 0 0 0 o O o 0 0 0 o O ui ui r m m m M vi vi ei E» ss Esi vi N C N a W `o a R L L L L L t L N N N N N N N R R R R R R R U U U U U U U 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Eli V3 Ef3 V3 6? V3 EiT O O O O O O O O O O O O O O O O O O O O O O (U OJ (D W (h N OJ OJ N (O f� N ER Hi 69 EFT EA EA fA H3 64 N N O N N N No �, m m N dm ati R M ¢O NO N E N N E E E R L N N N O O O N > R > R > U 3 O Eno OZ Z' z� Z O c o O- fn m in O O O S O N O O > 0 ❑ a o O @ N O N L N R N (n N m E W o 6 O > ❑ � o O N N T Q U Eo o ° W 0_ O > 0 N > R C m Q U O d o N 'N Q o a N d' 0 o n O U aoi E CO W o Q N C[ LL 0 0 0 m w N N N U U_ U U) c J FK N N U a y > O F i 2i U U It lV ro LL c /E § { \ {{_ a = _ ) §f \ { _— CL ) }e \/(� ( \ CL \ E 0 c\ \ \ \ E \\ \ C: E # @ /\\j) oa ee e 3{; 3 3\ / co / a) ±3 co A[ & ) — — — ) j—CcD ) f — $/ { _ ) J — ` — / \ \ — |\7 J /cCc \ ) § _ [! § : = 2 / e k \/§ 5 2 — / E ƒ—&//\ \) / _ _ o /)\ /§±\J / \/ \\ /{ƒ ƒ zmm CD ! 2 _ — 0 » — _ — _ = 2 Mn @ \ 2 )E e_ — _ _ Q ( ]/ { —K 0ƒ / \ : \ /( �% `\ {\ _�CL : a) cm /] \/ // 0m ) \\ // \[ }/ o — § — _ CD \m \ k ? _ ®J _2 — /\ {(( }_\ ! ® h \ § / - k \\/ %\ a— »\ /§ /(± / Alaska Energy Authority - Renewable Energy Fund BUDGET_ INFORMATION _ BUDGET SUMMARY: WEST CREEK HYDROELECTRIC PROJECT Milestone or Task Federal Funds State Funds i (Proposed AEA Grant) j I Municipality Funds Other Funds TOTALS Phase 2 : Feasibility Analysis I Data collection and review Site inspection $14,Ann j $12,000 $3,600 f $3,000 $18,000 $15,000 Hydrology Operation model j $8,000 j $8,000 j $2,000 $10,000 $10,000 _ Cost estimate spreadsheet ______ $242000 1 $6,000 $30,000 Economic analysis model Alternatives analysts - - Draft report S6 400 $76 000 -- $28 000 $1,600 $19,000 $7,000 $8 000 $95,000 $35,000 - Environmental sco in p 9 $28,800 $7,200 i_ $36,000 Final repot $13,600 - $16,800 $3,400 $17,000 - -- Project management _� - $4,200 1 $21,000 Phase 3 - Design and Permitting Field Studies $564,800 i $141, 200 _ $706, 000 Permit applications and processing Final design q i $343.200 i S5,720,000 $85,800 j 51,430,000 - $429,000 $7,150,000 Phase 4 - Construction Construction mana ement 9 i �- $5,720,000 _ $5,720,000 __-- Mobilization Access road _.- _ -- � ----- -_'-- $3,000,000 $3,000,000 _� ( $5,300,000 $17,400,000 $5,300 000 $17,400,000 Dam and reservoir ------------ - - ---- Intake, tunnel, and penstock j --- j 1 $43,100,000 $43,100,000 Powerhouse -- - - Transmission facthties -- L $21,700,000 $30,300,000 $21,700,000 Interest during construction i 1 $4,900 000 $4,900,000 Total $0 I $6,864,000 i $1,716,000 1 $131,420,000 $140,000,000 r MILESTONE or TASK BUDGET CATAGOftIES: Phase 1 - Recon- naissance I Phase 2 - t Phase 3 - 1 Assessment/ Design and I Feasibility , Permitting Phase 4 - I Construction :, TOTALS Direct Labor and Benefits $0 _ $10,000 1 $100,000 j $300,000 $410,000 Travel, Meals, or Per Diem -- - ---- - - Eq uipment- - - Supplies - - -- $0 --- $0 $0 - - $0 $15,000 - - - 1$0 j _$0 $0 $0 -' - $285,000 1 $8,170 000 $20,000 '- $50 000,000 $ 600,000 $35,000 $50,000,_0_00 $600,000 Contractual Services $0 --- $5 500,000 $75 000,0007b SO -- - $13,955,000 Construction Se vices Other Direct Costs $0 $0 1 _ $0 $0� $0 $0 000,000 $0 TOTAL DIRECT CHARGES $0 $295,000 1 $8,285,000 i S131,420,000 $140,000.000 RFA AEA i i-005 Budget Form ®N't' ALASKA Renewable Energy Fund Round 5 Grant Budget Instructions NOTICE TO GRANTEES Reimbursement to a Grantee under this program is on a cost reimbursable basis. In accordance with the terms of the grant a Grantee is required to submit certified requests for reimbursements that document commitments and expenditures and demonstrate meeting milestones identified in the grant. A proposed reimbursement schedule tied to completion of milestones must be identified in the applicant's proposal. The Alaska Energy Authority ("AEA" or "Authority") will not approve a reimbursement schedule that does not reflect costs or commitments tied to the accomplishment of milestones identified in the grant. The final reimbursement schedule is subject to negotiation and will be incorporated into the grant agreement. The Authority may authorize a percentage of grant funds, up to 20% depending on the type of grant, as an advance reimbursement at the startup of the grant. The Authority may also withhold up to 20% of the total grant subject to completion of the project and submission of final reports and other documentation that may be required by the grant. A Grantee is required to account for and document all expenditures of grant and matching funds including documentation of expenditures on any advanced reimbursement. All requests for reimbursement are subject to audit by the Authority. The Grantee is also required to comply with 2.AAC.45.010, the State Single Audit regulations. 1. Budget Form Information concerning the proposed grant budget needs to be provided on the Grant Budget Form. The Grantee must tie their budget request to the proposed milestones they propose in their application. Examples of milestones for each project phase are included with the budget form and in Section 2 of the RFA. For the purposes of determining potential cash -flow and a reimbursement schedule Grantees should use the form to identify the proposed date that the milestone would be met, the anticipated amount of grant funds to be expended to meet that milestone, and the amount and type of matching resources they intend to apply to that milestone. The bottom part of the form includes the allowable Budget Categories and is intended to be a summary of types of cost for each phase of the grant. 2. Allowable Costs Allowable costs for a grant include all reasonable and ordinary costs for direct labor and benefits, travel, equipment, supplies, contractual services, construction services, and other direct costs identified that are necessary for and incurred as a direct result of the project. P.FA AEA12-001 Grant Budget Instructions Page 1 of 5 7-1-11 ALAS KA Grant Bud et Instructions ENERGY AUfFORPY Renewable Energy and Round 5 A cost is reasonable and ordinary if, in its nature or amount, it does not exceed that which would be incurred by a prudent person under the circumstances prevailing at the time the decision was made to incur the costs. Allowable costs under this grant include all reasonable and ordinary costs for direct labor & benefits, travel, equipment, supplies, contractual services, construction services, and other direct costs identified and approved in the Project budget that are necessary for and incurred as a direct result of the Project and are consistent with the requirements of the grant agreement. A cost is reasonable and ordinary if, in its nature and amount, it does not exceed that which would be incurred by a prudent person under the circumstances prevailing at the time the decision was made to incur the costs. Allowable costs are only those costs that are directly related to activities authorized by the Grant Agreement and necessary for the Project. The categories of costs and additional limits or restrictions are listed below: a. Direct Labor & Benefits Include salaries, wages, and employee benefits of the Grantee's employees for that portion of those costs attributable to the time actually devoted by each employee to, and necessary for the Project. Direct labor costs do not include bonuses, stock options, other payments above base compensation and employee benefits, severance payments or other termination allowances paid to the Grantee's employees. b. Travel, Meals, or Per Diem Include reasonable travel expenses necessary for the Project. These include necessary transportation and meal expenses or per diem of Grantee employees for which expenses the employees are reimbursed under the Grantee's standard written operating practice for travel and per diem or the current State of Alaska Administrative Manual for employee travel. c. Equipment Include costs of acquiring, transporting, leasing, installing, operating, and maintaining equipment necessary for the Project, including sales and use taxes. Equipment owned by the Grantee is to be charged to the project at the monthly rates contained in the Data Quest Blue Book. The rates for equipment owned by the Grantee for less than a month's duration are to be computed on an hourly charge determined by dividing the monthly rate by 176. Equipment rented by the Grantee can be charged to the grant at actual invoiced charge rates, subject to a maximum amount equal to the hourly rates contained in the Data Quest Blue Book. The Authority's Project Manager must approve all equipment charge rates to be used by the Grantee. The Data Quest Blue Book is available to the AEA Project Managers and grantees may contact them for current allowable rates. Subject to prior approval of the Authority's Project Manager, costs or expenses necessary to repair or replace equipment damage or losses incurred in performance of work under the RFA AEA12-001 Grant Budget Instructions Page 2 of 5 7-1-11 grant may be allowed. However, damage or losses that result from the Grantee's ALASKA Grant Bud et Instructions Renewable Energy Fund Round 5 employees, officer's, or contractor's gross negligence, willful misconduct, or criminal conduct will not be allowed. d. Materials and Supplies Include costs of material, office expenses, communications, computers, and supplies purchased or leased by the Grantee necessary for the Project. e. Contractual services Include the Grantee's cost of contract services necessary for the Project. Services may include costs of contract feasibility studies, project management services, engineering and design, environmental studies, field studies, and surveys for the project as well as costs incurred to comply with ecological, environmental, and health and safety laws. f. Construction Services For construction projects this includes the Grantee's cost for construction contracts, labor, equipment, materials, insurance, bonding, and transportation necessary for the Project. Work performed by the Grantee's employees during construction may be budgeted under direct labor and benefits. Contracted project management or engineering may be budgeted under contractual services and major equipment purchases made by the Grantee may be budgeted under equipment. g. Other Direct Costs In addition to the above the following expenses necessary for the Project may be allowed. Net insurance premiums paid for insurance required for the grant Project; • Costs of permits and licenses for the grant Project; Non -litigation legal costs for the Project directly relating to the activities; in this paragraph, "non -litigation legal costs' includes expenses for the Grantee's legal staff and outside legal counsel performing non -litigation legal services; Office lease/rental payments; Other direct costs for the Project directly relating to the activities and identified in the grant documents; and/or Land or other real property or reasonable and ordinary costs related to interests in land including easements, right-of-ways, or other defined interests. 3. Specific Expenditures not allowed Ineligible expenditures include costs for overhead, lobbying, entertainment , alcohol, litigation, payments for civil or criminal restitution, judgments, interest on judgments, penalties, fines, costs not necessary for and directly related to the grant Project, or any costs incurred before the RFA AEA12-001 Grant Budget Instructions Page 3 of 5 7-1-11 beginning date of the grant as indicated on the signature page. RFA AEA12-001 Grant Budget Instructions Page 4 of 5 7-1-11 ® ALASKA Grant Budgc�et Instructions Renewable Energy -Fund Round 5 Overhead costs described in this section include: ' salaries, wages, applicable employee benefits, and business -related expenses of the Grantee's employees performing functions not directly related to the grant Project; office and other expenses not directly related to the grant Project; and costs and expenses of administration, accounting, human resources, training, property and income taxes. entertainment. self-insurance. and warehousina. 4. Match and Cost Sharing If the Applicant is providing a match, it is should be detailed either as a specific dollar amount or as a percentage of the total project budget. The type and amount of matching contributions should be discussed in the application under section two. Cost sharing or matching is that portion of the Project costs not borne by the Authority. The Authority will accept all contributions, including cash and in -kind, as part of the Applicants` cost sharing or matching when such contributions meet the following criteria: Are provided for in the Project budget; Are verifiable from the Applicant's records; Third party costing sharing contributions are verifiable (with a letter of intent or similar document); Are not included as contributions for another state or federally assisted project or program (i.e., the same funds cannot be counted as match for more than one program); Are necessary and reasonable for proper and efficient accomplishment of the Project or program objectives; Are allowable costs; Are not paid by the State or federal government under another award, except for authorized by the State or federal statute to be used for cost sharing or matching; Must be incurred within the grant eligible time period. Any match proposed with the application will be required in the Grant award and the Grantee will be required to document the use of the proposed matching funds or in -kind contributions with their request for reimbursement. Previous Renewable Energy Fund grants will not be counted as match. 5. Valuing In -Kind Support as Match If the Applicant chooses to use in -kind support as some; or, its entire match, the values of those contributions will be reviewed by the Authority at the time the budget is approved. The values will be determined as follows: The value of real property will be the current fair market value as determined by an independent third party or a valuation that is mutually agreed to by the Authority and the Applicant and approved in the grant budget. RFA AEA12-001 Grant Budget Instructions Page 5 of 5 7-11-11 ALASKA Grant Bud et Instructions Renewable Energy�und Round 5 The value assessed to Applicant equipment or supplies will not exceed the approved equipment rates or fair market value of the supplies at the time the grant is approved or amended. Equipment usage will be valued based on approved usage rates that are determined in accordance with the item •c" above. Rates paid will not exceed the fair market value of the equipment if purchased. Rates for donated personal services will be based on rates paid for similar work and skill level in the recipient's organization. If the required skills are not found in the recipient organization, rates will be based on rates paid for similar work in the labor market. Fringe benefits that are reasonable, allowable, and allocable may be included in the valuation. Transportation and lodging provided by the Applicant for non -local labor will not exceed the commercial rates that may be available within the community or region. 6. Grant Disbursements Applicants are reminded that they must request disbursement of grant funds in the form and format required by the Authority with appropriate back-up documentation and certifications. This format will be provided by the Authority. The back-up documentation must demonstrate the total costs incurred are allowable, and reflect the amount being billed. Documentation must include: • A summary of direct labor costs supported by timesheets or other valid time record to document proof of payment. Travel and per diem reimbursement documentation. Contractor or vendor payment requests. Invoices. Payment of grant funds will be subject to the Applicant complying with its matching contribution requirements of the proposed grant. Payment of grant funds will be made by AEA to the Grantee within 30 days of receipt of a properly completed, supported, and certified Reimbursement Request, RFA AEA12-001 Grant Budget Instructions Page 6 of 5 7-1-11 WEST CREEK HYDROELECTRIC PROJECT ECONOMIC ANALYSIS General West Creek General Inflation 2.75 % O&M ($000) $ 1,500 Project Life, years 50 Total Project Cost 140,000 Financing Term, years 30 Diesel Generation Reserve Fund - Financing Rate 6.00 % Fuel Inflation 3.75 % Municipality Phase II & III grants 6,864 Reserve Fund Earnings Rate 4.00% Efficiency (kWh/gal) 14.5 Municipality Phase It & III match 1,716 Initial Power Sales Rate, $/kWh $ 0.25 Var O&M($IkWh) $ 0.01 Construction % grant funding 80% Power Sales Escalation Rate 2.75% Min. O&M ($000) $ - Municipality Cost ($000) $ 28,000 Skagway Share of Net Revenue 50% AEA Cost ($000) $112,000 - Power. Without West Creek With West:Creek Costs Generation Cost YC Fuel Requlmm nB -Generation Revenue Load Growth Year Year Cost Diesel West Creek Skagway Total Skagway Alaska Reserve Reserve Cruise Line 0.0% Diesel Fuel O&M Total $/kWh ($/gal) West Debt C Total Rate, Gross Net Net Net Fund Draw Fund Savings Creek Service $lkWh Revenue Revenue Revenue Revenue Balance 2007 27,000 27,000 2008 3.00 27,000 27,000 2009 3.11 27,000 27,000 2010 3.23 27,000 27,000 2011 3,35 27,000 27,000 2012 3.48 27,000 27,000 2013 3.61 27,000 27,000 2014 3.74 27,000 27,000 $ - 1 2015 3.88 27,000 27,000 7,228 335 7,564 0.280 27,000 $ 2,034 $ 1,814 $ 3,848 0.252 $ 6,804 $ 2,956 $ 1,478 $ 1,478 $ - $ - $ 760 2 2016 4.03 27,000 27,000 7,499 345 7,844 0.291 27,000 $ 2,034 $ 1,864 $ 3,898 0.259 $ 6,991 $ 3,093 $ 1,547 $ 1,547 $ - $ - $ 853 3 2017 4.18 27,000 27,000 7,781 354 8,135 0.301 27,000 $ 2,034 $ 1,915 $ 3,949 0.266 $ 7,183 $ 3,234 $ 1,617 $ 1,617 $ - $ - $ 951 4 2018 4.34 27,000 27,000 8,072 364 8,436 0.312 27,000 $ 2,034 $ 1,967 $ 4,002 0.273 $ 7,381 $ 3,379 $ 1,690 $ 1,690 $ - $ - $ 1,055 5 2019 4.50 27,000 27,000 8,375 374 8,749 0.324 27,000 $ 2,034 $ 2,022 $ 4,056 0.281 $ 7,584 $ 3,528 $ 1,764 $ 1,764 $ - $ - $ 1,165 6 2020 4.67 27,000 27,000 8,689 384 9,073 0.336 27,000 $ 2,034 $ 2,077 $ 4,111 0.289 $ 7,792 $ 3,681 $ 1,841 $ 1,841 $ - $ - $ 1,281 7 2021 4.84 27,000 27,000 9,015 395 9,410 0.349 27,000 $ 2,034 $ 2,134 $ 4,168 0.297 $ 8,007 $ 3,838 $ 1,919 $ 1,919 $ - $ - $ 1,403 8 2022 5.02 27,000 27,000 %353 406 9,759 0.361 27,000 $ 2,034 $ 2,193 $ 4,227 0.305 $ 8,227 $ 4,000 $ 2,000 $ 2,000 $ - $ - $ 1,532 9 2023 5.21 27,000 27,000 9,704 417 10,120 0.375 27,000 $ 2,034 $ 2,253 $ 4,287 0.313 $ 8,453 $ 4,166 $ 2,083 $ 2,083 $ - $ - $ 1,667 10 2024 5.41 27,000 27,000 10,068 428 10.496 0.389 27,000 $ 2,034 $ 2,315 $ 4,349 0.322 $ 8,686 $ 4,336 $ 2,168 $ 2,168 $ - $ - $ 1,810 11 2025 5.61 27,000 27,000 10,445 440 10,885 0.403 27,000 $ 2,034 $ 2,379 $ 4,413 0,331 $ 8,924 $ 4,511 $ 2,256 $ 2,256 $ - $ - $ 1,961 12 2026 5.82 27,000 27,000 10,837 452 11,289 0.418 27,000 $ 2,034 $ 2,444 $ 4,479 0.340 $ 9,170 $ 4,691 $ 2.346 $ 2,346 $ - $ - $ 2,119 13 2027 6.04 27,000 27,000 11,243 465 11,708 0.434 27,000 $ 2,034 $ 2,512 $ 4,546 0.349 $ 9,422 $ 4,876 $ 2.438 $ 2,438 $ - $ - $ 2,286 14 2028 6.26 27,000 27,000 11,665 477 12,142 0.450 27,000 $ 2,034 $ 2,581 $ 4,615 0.359 $ 9,681 $ 5,066 $ 2,533 $ 2,533 $ - $ - $ 2,461 15 2029 6.50 27,000 27,000 12,102 490 12,593 0.466 27.000 $ 2,034 $ 2,652 $ 4,686 0.368 $ 9,947 $ 5,262 $ 2,631 $ 2,631 $ - $ - $ 2,645 16 2030 6.74 27,000 27,000 12,556 504 13,060 0.484 27,000 $ 2,034 $ 2,725 $ 4.759 0.379 $ 10,221 $ 5,462 $ 2.731 $ 2,731 $ - $ - $ 2,839 17 2031 7.00 27,000 27,000 13,027 518 13,545 0.502 27,000 $ 2,034 $ 2,799 $ 4,834 0.389 $ 10,502 $ 5,668 $ 2,834 $ 2,834 $ - $ - $ 3,043 18 2032 7.26 27,000 27,000 13,515 532 14,047 0.520 27,000 $ 2,034 $ 2,876 $ 4,911 0.400 $ 10,791 $ 5,880 $ 2.940 $ 2,940 $ - $ - $ 3,257 19 2033 7.53 27,000 27,000 14,022 547 14,569 0.540 27,000 $ 2,034 $ 2,956 $ 4,990 0.411 $ 11,088 $ 6,098 $ 3,049 $ 3,049 $ - $ - $ 3,481 20 2034 7.81 27,000 27,000 14,548 562 15,110 0.560 27,000 $ 2,034 $ 3,037 $ 5,071 0.422 $ 11,393 $ 6,322 $ 3,161 $ 3,161 $ - $ - $ 3,717 21 2035 8.11 27,000 27,000 15,094 577 15,671 0.580 27,000 $ 2,034 $ 3,120 $ 5,155 0.434 $ 11.706 $ 6,551 $ 3,276 $ 3,276 $ - $ - $ 3,965 22 2036 8.41 27,000 27,000 15,660 593 16,253 0.602 27,000 $ 2,034 $ 3,206 $ 5,240 0.445 $ 12,028 $ 6,787 $ 3,394 $ 3,394 $ - $ - $ 4,225 23 2037 8.73 27,000 27,000 16,247 609 16,856 0.624 27,000 $ 2,034 $ 3,294 $ 5,328 0.458 $ 12,358 $ 7,030 $ 3,515 $ 3,515 $ - $ - $ 4,498 24 2038 9.05 27,000 27,000 16,856 626 17,482 0.647 27,000 $ 2,034 $ 3,385 $ 5,419 0.470 $ 12,698 $ 7,279 $ 3,640 $ 3,640 $ - $ - $ 4,784 25 2039 9.39 27,000 27,000 17,488 643 18,132 0.672 27,000 $ 2,034 $ 3,478 $ 5,512 0.483 $ 13,048 $ 7,535 $ 3,768 $ 3,168 $ - $ - $ 5,084 26 2040 9.74 27,000 27,000 18,144 661 18,805 0.696 27,000 $ 2,034 $ 3,574 $ 5,608 0.497 $ 13,406 $ 7,799 $ 3,899 $ 3,899 $ - $ - $ 5,399 27 2041 10.11 27,000 27,000 18,825 679 19,504 0.722 27,000 $ 2,034 $ 3,672 $ 5,706 0.510 $ 13,775 $ 8,069 $ 4,034 $ 4,034 $ - $ - $ 5,729 28 2042 10.49 27,000 27,000 19,530 698 20,228 0.749 27,000 $ 2,034 $ 3,773 $ 5,807 0.524 $ 14,154 $ 8,347 $ 4,173 $ 4,173 $ - $ - $ 6,074 29 2043 10.88 27,000 27,000 20,263 717 20,980 0.777 27,000 $ 2,034 $ 3,877 $ 5,911 0.539 $ 14,543 $ 8,632 $ 4,316 $ 4,316 $ - $ - $ 6,437 30 2044 11.29 27,000 27,000 21,023 737 21,759 0.806 27,000 $ 2,034 $ 3,983 $ 6,017 0.553 $ 14,943 $ 8,926 $ 4,463 $ 4,463 $ - $ - $ 6,816 31 2045 11.71 27,000 27,000 21,811 757 22,568 0.836 27,000 $ - $ 4,093 $ 4,093 0.569 $ 15,354 $ 11,261 $ 5,631 $ 5,631 $ - $ - $ 7,214 32 2046 12.15 27,000 27,000 22,629 778 23,407 0.867 27,000 $ - $ 4,205 $ 4,205 0.584 $ 15,776 $ 11,571 $ 5,785 $ 5,785 $ - $ - $ 7,631 33 2047 12.61 27,000 27,000 23,478 799 24,277 0.899 27.000 $ - $ 4,321 $ 4,321 0.600 $ 16,210 $ 11,889 $ 5,945 $ 5,945 $ - $ - $ 8,067 34 2048 13.08 27,000 27,000 24,358 821 25,179 0.933 27,000 $ - $ 4,440 $ 4,440 0.617 $ 16,656 $ 12,216 $ 6,108 $ 6,108 $ - $ - $ 8,523 35 2049 13.57 27,000 27,000 25,271 844 26,115 0.967 27,000 $ - $ 4,562 $ 4,562 0.634 $ 17,114 $ 12,552 $ 6,276 $ 6,276 $ - $ - $ 9,001 36 2050 14.08 27,000 27,000 26,219 857 27,086 1.003 27,000 $ - $ 4,687 $ 4,687 0.651 $ 17,584 $ 12,897 $ 6,449 $ 6,449 $ - $ - $ 9,502 37 2051 14.61 27,000 27,000 27,202 891 28,093 1.040 27,000 $ - $ 4,816 $ 4,816 0.669 $ 18,068 $ 13,252 $ 6,626 $ 6,626 $ - $ - $ 10,025 38 2052 15.16 27,000 27,000 28,222 915 29,138 1.079 27,000 $ - $ 4,949 $ 4,949 0.688 $ 18,565 $ 13,616 $ 6,808 $ 6,808 $ - $ - $ 10,573 39 2053 15.72 27,000 27,000 29,281 940 30,221 1.119 27,000 $ - $ 5,085 $ 5,085 0.706 $ 19,075 $ 13,991 $ 6,995 $ 6,995 $ - $ - $ 11,146 40 2054 16.31 27,000 27,000 30,379 966 31,345 1.161 27,000 $ - $ 5,225 $ 5,225 0.726 $ 19,600 $ 14,375 $ 7,188 $ 7,188 $ - $ - $ 11,745 41 2055 16.93 27,000 27,000 31,518 993 32,511 1.204 27,000 $ - $ 5,368 $ 5,368 0.746 $ 20,139 $ 14,771 $ 7,385 $ 7,385 $ - $ - $ 12,372 42 2056 17.56 27,000 27,000 32,700 1,020 33,720 1.249 27,000 $ - $ 5,516 $ 5,516 0.766 $ 20,693 $ 15,177 $ 7,588 $ 7,588 $ - $ - $ 13,027 43 2057 18.22 27,000 27,000 33,926 1,948 34,974 1.295 27,000 $ - $ 5.668 $ 5,668 0.787 $ 21,262 $ 15,594 $ 7,797 $ 7,797 $ - $ - $ 13,712 44 2058 18.90 27,000 27,000 35,198 1,077 36,275 1.344 27,000 $ - $ 5,823 $ 5,823 0.809 $ 21,847 $ 16,023 $ 8,012 $ 8,012 $ - $ - $ 14,429 45 2059 19.61 27,000 27,000 36,518 1,107 37,625 1.394 27,000 $ - $ 5,984 $ 5,984 0.831 $ 22,447 $ 16,464 $ 8,232 $ 8,232 $ - $ - $ 16,178 46 2060 20.35 27,900 27,000 37,888 1,137 39,025 1.445 27,000 $ - $ 6,148 $ 6,148 0.854 $ 23,065 $ 16,916 $ 8,458 $ 8,458 $ - $ - $ 15,960 47 2061 21.11 27,000 27,000 39,309 1,168 40,477 1.499 27,000 $ - $ 6,317 $ 6,317 0.878 $ 23,699 $ 17,382 $ 8,691 $ 8,691 $ - $ - $ 16,778 48 2062 21.90 27,000 27,000 40,783 1,201 41,983 1.555 27,000 $ - $ 6,491 $ 6,491 0.902 $ 24,351 $ 17,860 $ 8,930 $ 8,930 $ - $ - $ 17,632 49 2063 22.72 27,000 27,000 42,312 1,234 43,545 1.613 27,000 $ - $ 6.669 $ 6,669 0.927 $ 25,020 $ 18,351 $ 9,175 $ 9,175 $ - $ - $ 18,525 50 2064 23.58 27,000 27,000 43,899 1,267 45,166 1.673 27,000 $ - $ 6,853 $ 6,853 0.952 $ 25,708 $ 18,855 $ 9,428 $ 9,428 $ - $ - $ 19,458 $462,017 $231,009 $231,009 0 $343,795 Page 1 of 1