The Bridge to Nowhere, and the Road to Access It

Sarah Palin said yes, thanks, to a road to nowhere in Alaska - Los Angeles Times.

I've been intrigued with the bridge story for a couple of years, and this article includes a map which helps flesh out the picture.  Here's something I wrote January 2007:

Think about that bridge to nowhere. I have in mind that it was to cost something like $225 million. (I'm not sure whether that was the federal portion, or the total cost. But let's say it was the total cost.) Some family members of the [then - Murkowsky] Alaska governor together own a plot of land on the Nowhere Island. It is valued at $240,000. (Probably a low assessment, but that's okay.) Based on its size and the size of the island, the island's value is $450 million (that assumes that their site is of approximately average value per acre, which I can't prove).

If all these things are correct, it would only take a 50% increase in the value of that island's land to finance that bridge.

From those data points, I'd make these observations:

1. If building the bridge does not increase land values by 50%, it is probably not worth doing the project.

2. If building the bridge does increase the land values by 50% or more, it may well be worth building that bridge.

3. If building the bridge does increase land values by 50% or more, why on earth should the federal taxpayer finance it permanently (I don't have a problem, necessarily, with the federal taxpayer financing it temporarily, and being repaid), giving a $225 million gift to the property owners on the island?

4. If the land value will rise by, say, $300 million, it certainly makes sense for Alaska to do this project, and collect back from the beneficiaries the cost of the project in the form of taxes on land value. Don't tax the buildings that private parties build on their land. Just tax the land value, which they didn't create! We, the funders of that project, created that value, and we're entitled to collect it to fund the next such project, and the next, and the one after that! A fountain of money, to fund public projects, instead of a fountain of money to line the pockets of the lucky porkees.

And the bridge would create value not just on Gravina Island, but on the "mainland" as well (it turns out that Ketchikan is on Revillagigedo Island, which the LAT article says is 35 miles wide and 55 miles long).  The map with the LA Times article shows a very different layout from what I'd imagined.  The airport is rather close to the city of Ketchikan (population 8,000 -- a small town in most states, but among the top 6 cities in Alaska), across the Tongass Narrows, which is traversed by a ferry whose route is a few thousand feet.   Gravina Island is 21 miles by 10 miles and "ripe for commercial and residential development."

It appears from the LAT article that despite the Gravina Island Bridge project having been killed (and the allocated Federal dollars allocated to other Alaska projects), the road leading to the bridge is still being built.  So curious minds want to know who owns the land out that way. They are getting a major gift from someone!  And since Alaska has low property taxes, they will share little of it with their Alaska community.

The 3.2 mile highway -- the road to nowhere -- is apparently costing $26 million.  Seems like some sort of administrative error that the road project would continue when the bridge is not curently planned to be bult.  And the current cost of the bridge would be $398 million.  And I assume that doesn't cover the road from the end of the bridge to the airport, perhaps 10 or 12 miles long, judging from the LAT map.