JUNEAU -- The new boom industry in Skagway is tourism, providing the bulk of the jobs and at the height of the summer, regularly giving the big cruise port the lowest unemployment rate in the state.
But tourism isn't Skagway's first boom. After the Klondike Gold Rush began in 1896, Skagway was the quintessential boom town.
The miners and supplies that supported the gold fields flowed through Skagway and over White Pass into the Yukon. And on the Skagway docks, legendary con man Soapy Smith worked hard to separate returning prospectors from their gold before coming to a bloody end.
Today, the visitors arrive at the docks on cruise ships and willingly hand over their money to hear about Soapy Smith and the rest of Skagway's colorful history, and to ride one of the region's top tourist attractions, the White Pass & Yukon Railroad.
That railroad began in 1898, carrying miners and mining supplies over White Pass into the Canadian interior and is still in operation today.
Now, that railroad, those docks and that history are dividing Skagway. A public vote in October will decide whether the railroad continues to dominate the city the way it has for the last 115 years.
It's all part of Skagway's Gateway project, which would make improvements to the waterfront and extend the railroad's control of those docks for another 35 years.
But the mining history -- and the pollution it left behind -- is complicating the debate as Skagway moves forward with tourism.
A White Pass spokesman said the company wants what's best for Skagway, but acknowledged that what it is advocating is also good for the railroad.
"I think it's good for the community -- we've obviously been a steady hand in business here for 115 years," said Tyler Rose, the railroad's executive director for human resources and strategic planning.
The railroad these days is owned by Toronto-based TWC Corp., which also has golfing clubs and resorts in Canada and Florida, and revenues last year of $200 million, according to company financial documents filed with the Canadian Securities Administrators.
Skagway provides the bulk of the company's profits, with the railroad and its associated docks bringing in $43 million in revenue last year, with $23 million of that being profits. TWC had a companywide profit of $3.5 million last year.
"Skagway has benefited from this relationship. I think everyone has benefited, White Pass as well as the community," Rose said.
Rose himself is a fourth-generation railroader, and it sometimes seems everybody in Skagway either has or had some connection to the railroad.
Skagway leased to the railroad the tidelands on which two of White Pass' three docks stand. That lease began in 1968 and is set to expire in 2023. The city and the railroad now want to extend the lease for another 35 years, but under Skagway's municipal code a deal of that size requires a public vote.
Mayor Mark Schaefer said the past relationship with White Pass has been been "quite beneficial" to the city, but the new lease is needed to enable the city to "regain control" of its waterfront and continue development. The city wants to build more and better cruise-ship docks, and lease all to White Pass.
But while the Skagway Assembly has agreed to the new deal with White Pass, not everyone likes it.
"The deal stinks," said Gary Hanson, an Assembly member who has become increasingly critical of the White Pass deal.
His main concern: there's never been a cost-benefit analysis to determine whether the deal is good for Skagway.
Hanson was originally appointed by the mayor to the Assembly's lease negotiating team. He didn't like the deal from the start, when the other two members focused on offering White Pass a lease extension to get its support for the project. Hanson said a better option might have been to buy out the remaining years of the lease.
Driving the timeline is a $10 million legislative appropriation Schaefer credits to former Gov. Sean Parnell, but if it is not spent by June 2016, it risks being lost, he said.
Hanson said that's not a good enough reason to rush the process.
"I think the mayor and others are afraid of looking like fools" if they allow the money to go back to the state treasury at a time when new capital appropriations are likely to be hard to obtain, he said.
"I'd rather give the money back than be strapped with this deal," Hanson said.
The deal with White Pass will also address one of the darker sides of the railroad's history. After the gold mines played out, a Yukon lead mine, now bankrupt, kept the railroad going. It shipped out its ore in rail cars and exported it through the White Pass terminal in Skagway.
But those rail cars and loading terminal conveyors were uncovered, and toxic lead dust polluted the area. When the mine closed in 1982, the railroad's business ended. With a polluted port, Skagway faced some of its darkest days. The cruise business had yet to take off, and the pollution was threatening new projects.
In 1989 the state's development arm, the Alaska Industrial Development and Export Authority, stepped in with tens of millions of dollars in investments.
It bought the export terminal from White Pass, invested in a cleanup and paid for a new ship loader, paving the way for today's ongoing export business from Yukon's Minto copper mine.
"AIDEA being able to come in and purchase the terminal when there wasn't a future mine out there, and remediate the area, made it better for the municipality of Skagway," said AIDEA project manager Jim Hemsath.
The number of jobs that reopening the terminal provided are dwarfed by the summer tourism jobs, but Hemsath said they're still significant.
The Department of Environmental Conservation praised the work done so far, but said more needs to be done, especially with contaminated sediments in the port. But the contamination isn't getting any worse, said Bruce Wanstall, a program manager with DEC.
"They're still using the ship loading conveyor, but they encased it to try to control the fugitive dust that caused most of the problem historically," he said.
That's worked, he said, and air quality testing shows there's no significant amount of dust escaping and no impact on people. The railroad had to pay to clean up its upland property.
The current export is copper ore that doesn't contain the lead that caused the problems in the past. It is being trucked to Skagway from Minto.
But the cleanup of the terminal and the railroad wasn't all that needed to be done, and Skagway's port remains polluted by metals and hydrocarbons, possibly from spills of petroleum products, Wanstall said.
That's what's causing the water quality problems, and having a toxic effect on some marine life.
"When ship screws stir up sediment you may have some of that metal causing some of that toxicity," Wanstall said.
But they know what to do about it. The Gateway plan calls for scraping up that sediment and using it as fill behind steel sheet pile. It would then be capped with an impervious surface, and would no longer pose a threat, Wanstall said.
The question then is who pays, and the agreement between Skagway and White Pass calls for White Pass to contribute $2 million to what Rose said is likely to be a $3.5 million cleanup.
"That pollution was caused by a number of entities," Schaefer said. The involvement of White Pass would help the city's long-term goal of getting it resolved so it no longer hampers development.
Skagway resident Roger Griffin ran unsuccessfully for Assembly last election with his sole issue being the lease, and doesn't like the agreement the Assembly approved over the summer with the railroad.
"They're lifting the burden of the cleanup from White Pass," he said. "White Pass' contribution is capped at $2 million, but the municipality's obligation is open-ended and likely to be much greater," he said.
He's now filed to run for election as mayor in October, with the White Pass lease a big part of his campaign platform.
Rose described the White Pass contribution to the cleanup as fair, especially since there were numerous others who may have been responsible for the contamination. White Pass subleased the property over the years.
"There have been a lot of operators down there," Rose said. "We have been there but so have others," he said.
White Pass' agreement to pay for a share of the cleanup stems from its concern for the community, he said. "I don't think a $2 million contribution is anything to sneeze at."
DEC's Wanstall said he's happy that Skagway harbor is slated to get cleaned up, and that there is local support for the effort.
"Ultimately our liability laws are nonselective -- we start with the facility operator and landowner, the Department of Law helps us figure out what's fair, but ultimately it is who caused the pollution," he said.
The Skagway case is notable among polluted sites because of the unusually long history of White Pass as a business. That means that even though the pollution may have happened decades ago, there's a responsible party with deep pockets still around, as well as the city. The federal Superfund for contaminated sites isn't available because the property isn't abandoned.
The Skagway Assembly approved the White Pass lease agreement at a July meeting, and called for an August vote to ratify the deal. But the lengthy lease agreement, and a memorandum of understanding take time to understand, and the city Thursday decided to move the vote to October, despite concerns from Schaefer and others that it made it harder to get the project underway before the $10 million state grant may expire.
But Hanson said more time is needed for the public to consider an issue on which decades of control of the waterfront will hinge.
He's urging a "no" vote, and reopened negotiations for a deal that's better for Skagway.
Hanson said Skagway needs the Gateway project, which would include new floating docks to keep Skagway a competitive port for the biggest, newest cruise ships.
Rose said he didn't know what White Pass' reaction would be if the voters reject the deal.
"We've started this process and negotiated in good faith and are actually expecting this to pass," he said. "Should it not, I think it causes us to obviously take a look at a lot of things."
Changing the election date to October moves the vote from the height of the tourist season, when it had been scheduled for a four-ship day in which many Skagway residents would be busy at their jobs.
It also may change the electorate, Hanson said, with seasonal railroad employees probably less likely to register and vote for the company's position in an October election.
The railroad has been the largest employer in town for decades, with employment going up and down with the railroad's business success.
It's currently at a high point, with as many as 200 employees at the height of the tourist season. That makes the railroad the biggest employer in Skagway by such a large margin that it's not clear who might be second.
Among those railroad employees are Assembly members and Mayor Schaefer.
Schaefer maintained that working for White Pass does not result in a legal conflict of interest for him, and said that's been confirmed by the city's attorney.
Schaefer is manager of train operations for White Pass.
Voters in Skagway knew where he worked when they elected him, Schaefer said, as well as knowing that the Assembly would be working on the lease agreement in his term as mayor.
He declined interview requests, but answered some questions by email.
He said the public, not the Assembly, will make the final decision on the lease.
"The lease was crafted to be determined by a vote of the people, so it is to be decided by the voters, not I," he said.
But lease critic Griffin called Schaefer's role an "unacceptable conflict of interest," even if it was legal, and also evidence of the railroad's influence in Skagway.
"People are really leery of speaking out on this thing, because everybody depends on White Pass," he said.