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Going Dutch: a public/private-sector partnership is expanding Dutch Harbor's city dock.

Going Dutch A public/private-sector partnership is expanding Dutch Harbor's city dock.

In the Aleutian Islands at the boundary of the Pacific Ocean and Bering sea sits Dutch Harbor, the nation's No. 1 fishing port for 1989. The major support center for the Bering Sea fishing industry, the community of Unalaska, home of the seaport, is also a major world transshipment center in the making.

To help fulfill that promise, the Unalaska city government and two private firms - Sea Land Service and Petro Marine Services - have joined forces to expand the city's dock. The project resulted from a recognized community need for more public dock space.

While there are already about 16 private docks in the area, public docking facilities are no longer adequate to meet the harbor's needs. The present city dock on Amaknak Island has no crane for unloading containerized cargo and, at 420 feet, is small for a public dock facility.

Plans for the project call for a 731-foot sheet-pile extension to be added to the existing concrete and wood timber structure on Ballyhoo Road, halfway between the airport and the base of the spit. A crane running on 600 feet of crane rails at the expanded dock will be able to unload barges and large ships. The project also includes a new warehouse to be built by Petro Marine near the dock.

Sea-Land, Petro Marine and the city became partners in the venture after the city issued a request for proposals for the project in mid-1989. Through a process of competitive selection, review and negotiation, the two private firms and the city reached agreement and signed papers for the project in the fall of 1990.

Construction on the project, which was designed and engineered by Peratrovich, Nottingham and Drage of Anchorage, will begin later this spring under general contractor Construction and Rigging of Anchorage. Completion is projected for October 1991. The agreement stipulates that by August 1991, 200 feet of the dock will be finished, to enable Sea-Land to install and refurbish the crane while the rest of the dock is being completed.

The project's cost may exceed $15 million, according to Sea-Land officials. Roe Sturgelewski, public works director for the city of Unalaska and construction manager for the project, says that the city of Unalaska is investing $7.6 million from Alaska Industrial Development and Export Authority bonds to cover dock construction.

Sea-Land anticipates its capital investment at $6 million to cover the crane, crane rails and reinforced pillings. Petro Marine's share is expected to be $2 million to $3 million for the warehouse and for new fuel lines and pits on the dock.

According to Sturgelewski, the Unalaska City Council also has approved a proposal by Delta Western, another fuel distributor, to incorporate additional fuel vaults into the new section during initial construction.

Capital already invested in the area is a major drawing card for Sea-Land's long-term interest, says Charlie Grant, general manager of Sea-Land's Alaska operations. In 1990, plants owned by Universal Seafoods and Alyeska Seafoods underwent major expansions. Also, a new $70 million surimi plant by Westward Seafoods is expected to be in operation before May. During the last three years, more than $250 million - $225 million of that by private enterprise - has been invested in the fishing community.

Although Unalaska's permanent population numbers less than 3,000, its "consumer" population typically exceeds 20,000. Other recent improvements include housing, retail stores, service-sector businesses, and infrastructure developments such as water and sewer lines, electrical service, roads, docks, and school construction - things that improve the quality of life in the area. The city is seeking financial backing on a proposed new $4.2 million health clinic for the island whose population grew by 28 percent last year.

Sea-Land, which has been serving Alaska since 1964, added 700-foot vessels, or D-7s, to its Tacoma-Anchorage-Kodiak route in 1987, but still barged freight to Dutch Harbor from Kodiak. At the end of 1990, Sea-Land added Dutch Harbor to its regular D-7 route, leasing private dock facilities from American President Lines, which presently owns the only dock crane in Dutch Harbor, for loading and unloading the container ships until the city dock expansion is finished.

Sea-Land currently provides regularly scheduled seven-day service from Tacoma, a route that includes regular three-day service from Anchorage. Says M.G. Davis, Western and Southern Alaska manager for Sea-Land, "Seven days from Tacoma is a big plus, and so is weekly service. Now people have fresh produce and fresh meat, not frozen. Shops can be regularly replenished."

Petro Marine Services is a subsidiary of Seward-based Harbor Enterprises, an Alaskan-owned petroleum marketing and distribution firm, and has been doing business in the Dutch Harbor area since 1984. With space on the current city dock, a consignment agreement to sell marine diesel fuel, and a tank farm on the island, Petro Marine primarily services factory trawlers, floating processors and fishing boats, says Jim Burns, the firm's senior vice president of marketing. He explains that Petro Marine's additional fuel capacity on the expanded dock will enable the city's debt service payment on the AIDEA bonds through long-term leases for use of the dock. He adds that the two companies will have preferential use at the new facility because of their role in the financing.

Sea-Land's Davis says his firm has a 10-year contract to lease dock space from the city. Sea-Land will pay wharfage and docking fees for its ships and will have a "reserved parking space" on the dock at regularly scheduled times.

According to Burns, Petro Marine will lease a 400-foot section of the dock for fueling services and a separate parcel of land for the new warehouse. A two-story structure of approximately 40,000 square feet of leasable space is expected to be built on the other side of the road behind the city dock, on the site where gravel fill for the dock's construction will be quarried from a steep hillside.

Positive Impacts. The expanded dock will provide additional revenue for the community of Unalaska by accommodating a larger volume of marine traffic in the harbor. Because container ships can be unloaded more quickly than barges, dock space will be freed up faster. Processor and other vessels will find it easier to dock, refuel and unload fish. Also, more docking space will allow foreign-flagged vessels to dock and stay in town longer.

According to Sturgelewski, tax revenues are expected to grow from an anticipated rise in the share of the Bering Sea's groundfish harvest that goes through the port instead of being loaded onto trampers.

The city's new marine center also will strengthen Dutch Harbor's ability compete as an export-relay and transshipment center. Dutch Harbor is located only 18 miles from the trans-Pacific shipping lanes serving marine traffic between the U.S. West Coast and Japan.

American President Lines already has a weekly U.S.-Japan route via Dutch Harbor. According to Davis, Sea-Land plans to begin a regular route through Dutch Harbor to Asia once the dock expansion is completed.

Davis says, "We expect more and more cargo to be shipped through Dutch Harbor." Alaska's Railbelt and Kodiak, for example, will be able to benefit by routing fish and seafood export products to Dutch Harbor for transfer to Asia-bound ships. Also, seafood cargo unloaded fresh at the Dutch Harbor dock from the fishing boats and processors can be taken on as freight by vessels bound for the Orient or the West Coast.

Grant notes that Sea-Land, now with a four-day direct run from Dutch Harbor to Tacoma, already has seen an increase in southbound freight. He cites as an example Alaska seafood exports bound for Europe that currently use a trans-Atlantic shipping route after crossing the United States in railcars.

One day soon, via either a trans-Pacific or trans-Arctic route, European-bound exports also may pass through Dutch Harbor. According to Grant, Sea-Land is talking with Soviet officials about utilizing the Trans-Siberian Railroad for U.S. exports to Europe, proposing a water route from Tacoma to Dutch Harbor to Japan to Vladivostok, followed by a rail route across Asia into Europe.

Another proposed venture with the Soviets - this one between the city of Unalaska and the Soviet Union - would use a transpolar water route to Europe from Dutch Harbor, with goods transferred to a Soviet ice-breaker that would cross the Arctic Ocean.

Not to be overlooked, the public/private partnership that is expanding the Dutch Harbor city dock is significant because government spending for such projects, which create jobs and commerce for Alaska, is decreasing. Says Sturgulewski, "This project is more or less guaranteed by tenant financing, so there's minimum risk to the city. It shows a public/private partnership. As government spending decreases, there will be more public/private partnership in the future."

PHOTO : Tugboats maneuver the Sea-Land Kodiak into position at the American Presidential Lines dock in Dutch Harbor, Sea-land is using the private dock's crane to unload its vessels until its own crane can be installed
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Title Annotation:marine facilities update
Author:Collins, Gloria
Publication:Alaska Business Monthly
Date:Apr 1, 1991
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