Opinion: The Alaska Railroad needs to finish the Point MacKenzie extension

The Alaska Railroad Corp. has a clear mission: to provide safe, efficient and economical transportation and real estate services that support and grow economic opportunities for the State of Alaska. However, despite decades of operation and hundreds of millions in annual revenue, the ARRC has built no significant new track since Alaska purchased it in 1985. While the railroad thrives on tourism and maintains its infrastructure well, it has largely ignored its most critical responsibility — helping to unlock Alaska’s immense natural resource wealth for the benefit of Alaskans.

President Trump’s 2025 Executive order, Unlocking Alaska’s Extraordinary Resource Potential, underscores what many of us have known for years. Alaska’s oil, gas, critical minerals, timber and coal are not just important to our state economy; they are vital to America’s national security and pivotal to our energy future. The EO directs federal agencies to expedite projects like the Point MacKenzie Rail Spur, a 32-mile rail extension that would connect the Alaska Railroad to Port MacKenzie, one of the deepest-water ports in the state and a future export hub for our resource industries. With 75% of the project already built, including embankments, bridges and culverts, the remaining work is straightforward and shovel-ready. All that’s missing is the will to finish the job.

The ARRC made $250 million in revenue in 2022, generated $39 million in net income and did it all without a dime of operating subsidies from the state. That’s amazing and commendable, especially just a year after the pandemic. But in the process, the railroad has focused disproportionately on maintaining current operations and catering to the tourism industry. Freight, which made up 44% of revenue, remains ARRC’s core competency. It moved nearly 1.5 million tons of gravel in 2024 and continues to support oilfield operations and barge connections to the Lower 48. Yet when coal exports collapsed after 2011, the railroad chose to dismantle the Seward Coal Terminal instead of pursuing new freight corridors to diversify revenue. The lesson is simple: Alaska needs infrastructure that serves the real economy, and serves Alaskans — the owners — not just sightseeing tourists.

Port MacKenzie and the spur that would serve it are central to Alaskans’ future. Located just across Knik Arm from Anchorage, the port has a deep draft, no congestion and 9,000 acres of industrial land ready for development. The rail spur connecting it to Houston is already 75% built, with $184 million invested. The final cost to complete the spur is hotly debated. The ARRC cites a $290 million estimate, but some experts believe it can be done for closer to $100 to $150 million. Regardless, what’s clear is that the return on investment it delivers will far exceed the cost.

This spur is not speculative. It is a strategic necessity. Companies like Trilogy Metals have already committed to shipping copper concentrates from the Ambler Mining District through Port MacKenzie. Timber exporters are eyeing the spur to reduce trucking costs. The $43 billion Alaska LNG project could use it to transport construction materials, pipe and heavy equipment. And coal and fly ash exports could resume through this more efficient port, reducing our dependence on imports and creating jobs in the process. The possibilities are endless.

The spur would also bolster Alaska’s military logistics. Fort Greely, Eielson Air Force Base and Fort Wainwright all rely on the ARRC to transport munitions, Stryker vehicles and other equipment. Completing the spur would shorten transport distances and give the Department of Defense another access point for Arctic defense. In today’s geopolitical environment, rail access to secure ports is a national security issue.

Despite this, the ARRC continues to prioritize projects like the $137 million Seward passenger dock, set to open in 2026. While tourism is important, the revenue it generates is limited, seasonal and often tied to flat-fee contracts with cruise lines. Many passengers travel in privately operated dome cars under “pull” agreements — where the cruise company pays ARRC a set fee to haul its cars — yet those riders may still be included in total passenger counts. This can give a misleading impression of the railroad’s fare-based revenue and economic impact. Alaska’s long-term prosperity lies not in cruise ships, but in our resources.

We need to finish what we started. Completing the Point MacKenzie Rail Spur is the fastest, most cost-effective way to deliver results for the Alaska economy. It aligns directly with Trump’s EO, addresses freight needs, supports national defense, and creates the foundation for job growth in mining, timber, energy and construction. It reduces shipping costs by 32 miles compared with Anchorage, and by 140 miles compared with Seward. That’s a competitive edge Alaska cannot afford to ignore.

The ARRC must remember who it works for. It is a state-owned corporation, funded by public investment, accountable to all Alaskans. Our citizens expect it to grow the economy, not just maintain what already exists. The time for half-measures is over. The Point MacKenzie Rail Spur is ready, relevant and overdue. It is the key to unlocking the next chapter of Alaska’s resource economy, and we must not let bureaucratic inertia or competing port politics stand in the way.

Let’s finish the spur, open Port MacKenzie to full-scale development, and secure Alaska’s place as a global resource and strategic powerhouse. The time to act is now.

Kevin McCabe is the representative for House District 30, which encompasses Point MacKenzie, Big Lake and follows the Parks Highway all the way up to Anderson.

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