The Alaska Railroad depot at Anchorage's international airport, open for business since 2003, was envisioned as a bright and busy way station for travelers, among them rail commuters from the Valley and cruise ship passengers heading to or from the airport.
A 1999 marketing study projected the depot, built with $28 million in federal money secured by former Sen. Ted Stevens, could serve as many as 200,000 rail passengers annually within a year of opening.
Nothing like that has happened.
Instead, with no commuter rail service and declining cruise ship traffic, the airport rail station served just 20,000 rail passengers in 2009. And the railroad has mothballed it for this winter to save money, not even opening it up for events like weddings.
Most people would agree the depot at Ted Stevens Anchorage International Airport hasn't reached its potential. Is it another grand project that was overkill for the need, as some critics contended before the depot was even built? Or is it just ahead of its time?
Alaska Railroad executives, present and past, say building it was the right decision.
Railroad president and CEO Pat Gamble says other cities all over the country are now trying to get federal grants to do what Anchorage did years ago: "They're trying to connect up their public transportation systems to make them more efficient, faster, and better for the customer. Anchorage got way ahead of that deal when it built its depot."
Former Gov. Bill Sheffield, who ran the railroad before Gamble and is now Anchorage port director, said if the railroad hadn't taken advantage of the opportunity when it did, the chance would have been lost as other airport projects filled up the space near the terminal. "The spot wouldn't be there. And it would cost more to do it today, by a lot."
The depot was named after Sheffield, who was in charge of the railroad when the project got under way.
Both Sheffield and Gamble think the depot's use will increase, particularly if Anchorage and Mat-Su local governments and the railroad ever start up commuter rail service with a stop at the airport.
Former state Rep. Andrew Halcro of Anchorage was one of at least two legislators in 2001 who questioned whether building the depot was wise use of money. He still says that the money could have been better spent elsewhere.
"This seemed to be one of those projects where the money was there and it was make any excuse to make it happen," said Halcro, whose family operates a rental car business at the airport.
And Pat Burden, president of Northern Economics -- which did the 1999 marketing study for the project -- says in hindsight, the depot probably shouldn't have been built.
AN EMPTY CAVERN
Most Anchorage residents have never seen the airport depot from the inside, since it's not open to the public.
The charter trains that carry cruise ship passengers between the airport and Seward and Whittier mostly operate between mid-May and mid-September.
The depot doesn't itself make any money, says Gamble. There's no special fee for the cruise lines to use it, but cruise lines pay to charter trains to it.
The depot is a cavernous building with a rounded roof and a skylight running the length of it. Posts with tree-like branches reach up to the ceiling to support the structure. A wall full of windows slants out toward the air terminal.
The depot sits next to the rental car parking garage.
Benj Kammer, facilities contract manager for the railroad, comes out and checks on it once or twice a week. During winter, the place gets vacuumed occasionally to hold the dust down, Kammer says.
On a recent visit, it was cool -- in the 60s -- and quiet, with tables and chairs scattered throughout the main floor and an overflow room one level down.
A kitchen with stainless steel sinks, refrigerators, and three big heaters to keep food warm was used by caterers at special events until the railroad decided to shutter the building completely, due, rail executives say, to the economic downturn and the cost of managing it, cleaning and providing security.
The depot itself is locked up tight, but one section is open all the time and used by airport employees and those who rent cars: a tunnel that runs from the depot to the air terminal near "C" concourse.
SEN. STEVENS GOT MONEYU.S. Sen. Ted Stevens "miraculously" got $28 million in federal money for the project, which paid for it in full, Sheffield says. Stevens couldn't be reached for this story.
The project got a push after a visit by President Clinton's Transportation secretary, Rodney E. Slater, who came to Anchorage in the late 1990s and toured the railroad and other transportation facilities, said Jim Blasingame, who retired in January as an Alaska Railroad vice president.
Blasingame, the mayor, Sheffield, Stevens and others were in the group on tour with the DOT secretary. At the time, the railroad had a line that ran close to the airport, but didn't connect to it. "He (Slater) said there were federal funds available to do things and we ought to look at that," said. Blasingame.
Railroad officials asked Stevens' staff to pursue it.
Burden, at Northern Economics, said the consulting firm was getting ready to do a feasibility study on an airport depot for the railroad, when the railroad heard they had already gotten a grant to pay for it. The feasibility study turned into a marketing study.
MORE MARKETING NEEDED?
The 1999 marketing study by Northern Economics said the number of passengers and locals using the depot would depend on how hard the railroad marketed the service. The study projected, for example, that at least 120,000 passengers annually could be had by 2009 through a combination of tour and charter operations -- booking people who fly into Anchorage directly onto an airport train to Denali National Park, for example -- and through added train service from the airport to downtown conventions.
"They've opted to be more conservative and not take the risks to develop a market," Burden said.
There would be costs to developing new markets, and the railroad would likely lose money in the beginning, he said.
In response, Gamble said the railroad's "'conservative' marketing efforts have doubled passenger revenue between 2001 and 2008. I would say our marketing is just fine."
The Northern Economics study, he said, is 11 years old and has "a questionable track record of predicting the future. It did not anticipate many market realities at the time it was created including high gas prices, the cruise ship tax, and a national recession that all have had a tremendous impact on Alaska's tourism market."
The railroad proposes eventual service between its depot downtown, the airport and Dimond Center. But the demand so far is small and unsteady, and such service doesn't yet make sense financially, Gamble said.
"An eventual commuter rail service that is supported by a regional transit authority and operating subsidies could certainly change that service picture," he said.
The railroad's financial well-being is closely tied to the state's economy, said Gamble. And lately, it's been suffering, partly due to a decline in leisure travel as a result of the recession.
Over the past two years, the railroad laid off 25 percent of its work force, Gamble said in a January report to the state.
Still, he said, the railroad and other entities have slowly been moving closer to establishing commuter rail service, Meantime, the airport depot gets mostly cruise ship passengers, and Gamble expects another flat year for that business.
As Sen. Stevens said during the airport depot's grand opening in December of 2002, "It's years ahead of its time."
The senator known for bringing home government dollars to Alaska also said, "It doesn't have to pay for itself. It was a grant from the federal government."
Find Rosemary Shinohara online at adn.com/contact/rshinohara or call her at 257-4340.
By ROSEMARY SHINOHARA
rshinohara@adn.com