Eaglecrest gondola needs at least another $3M, but walking away will cost the city far more, board members told

Asking Goldbelt, cruise industry for more funds among options as CBJ tries to cope with post-election tax cuts

A used gondola awaits installation near Eaglecrest Ski Area on Sept. 13, 2025. (Mark Sabbatini / Juneau Independent)

By Mark Sabbatini

Juneau Independent

Eaglecrest needs at least another $3 million to complete the gondola, but it’s a better option than the more than $10 million it would cost to abandon the project, the ski area’s board members were told at their annual retreat Saturday.

The project is also experiencing more delays since the bidding deadline for a general contractor has been extended by three weeks until Nov 21, said Craig Dahl, a special projects manager for the city. That squeezes what officials have said was already a minimal timeline for completing the gondola by a May 2028 deadline, at which point Goldbelt Inc. could reclaim the $10 million it provided under an operating agreement with the city.

"That person should have been in place six months ago," Dahl told the board, referring to the general contractor. He said hiring a contractor, which will now likely take until at least mid-December, "is going to be the first opportunity to actually get a detailed and accurate cost estimate for the project."

Among those cost hikes is the cost of the gondola itself has increased from $1.9 million when the Assembly agreed to the purchase in 2022 to at least $5.3 million now, Dahl said. That’s due to additional towers and other parts that roughly doubled the original price, which have been in storage overseas for the past two years at an additional cost.

Shipping them to Juneau now means paying at least 15% in tariffs (about $279,000) imposed by the Trump administration — and the tariff could be 100% if the items are classified as steel rather than ski area materials, but Dahl said that is unlikely.

Furthermore, Eaglecrest is facing millions of dollars in additional costs for planned maintenance and upgrades ranging from its parking lot to infrastructure extending to the top of the mountain. Craig Cimmons, the resort’s general manager, said in an interview Sunday the ski area is in solid operational shape for its 50th season — aside from the Black Bear lift which will be closed a second straight year due to mechanical issues — but longer-term projects remain a major issue.

It’s unlikely the Juneau Assembly is going to look favorably at requests for additional money for the city-owned ski area, especially after two tax-cut measures were approved by voters in last month’s municipal election, Cimmons said. That means the options going forward may include asking Goldbelt — and possibly other entities such as the cruise industry — for more gondola money.

"I think the money for the gondola project will have to come from somewhere else besides the Assembly and that's pretty obvious," he said. "What I really need is the financial support from the Assembly to continue improving the ski area as it is now."

Among the ways city leaders might consider funding for the gondola is by increasing docking fees for cruise ships, City Finance Director Angie Flick said in an interview Monday. She is scheduled to present a range of options for the city’s overall post-election budget plans to the Assembly’s Finance Committee on Wednesday.

Dahl and Cimmons both said they believe Eaglecrest is on track to complete the gondola by the May 2028 deadline, and that Goldbelt has remained a strong partner in the project despite previous cost and timing setbacks. The urban Alaska Native corporation previously agreed to extend the original deadline of 2027 for a year.

"Goldbelt is very enthusiastic about the project and I don’t see anything unraveling assuming everything is moving forward as scheduled," Dahl wrote in an email to the Independent on Monday. "The gondola is an important new shore experience to serve the visitor industry and in the case of Goldbelt, they expect to have a new cruise terminal on North Douglas, and the gondola fits into those plans."

Goldbelt President and CEO McHugh Pierre did not immediately respond to email questions from the Juneau Independent sent Monday morning. When asked similar questions in May he didn’t rule out an extension to the deadline, stating "Goldbelt has not been approached by the CBJ to alter the existing contract, so I cannot comment or speculate on what might be possible in the future.”

The gondola remains the heart of Eaglecrest’s hope of establishing year-round profitable operations, especially with much of the resort’s aging infrastructure deteriorating and climate change expected to result in increasingly shorter ski seasons. The city has been subsidizing Eaglecrest’s operations for many years, but Assembly members have stated their willingness and ability to continue doing so is limited, especially since the amounts involved have risen significantly in recent years.

Goldbelt also has a strong commercial interest in the gondola since the agreement with the city gives the company 10% to 25% of the gondola’s gross revenue for at least 25 years, with a minimum payout of $20 million. The company is also developing a private two-berth cruise port on land it owns along the west coast of Douglas Island, which would put several hundred thousand passengers a year a relatively short distance from the ski area.

Work on the gondola project is progressing, including a "lower terminal to mid-station road completed this week," Flick noted in a memo to Assembly members ahead of Wednesday’s Finance Committee meeting. She also noted "the current project budget is not sufficient to fully deploy the gondola and address minimum mountain top development necessary to attract tourists to visit," but estimated it will also be costly for the city to abandon the gondola.

"Our best guess is that if we pulled out now, we would have a sunk cost of $10.8M and have to write a check to Goldbelt for $11.7M," she wrote.

The "sunk cost" is what the city has already spent, including funds provided by Goldbelt, Flick said on Monday. She said the $11.7 million payment to Goldbelt would be the money the company provided plus interest, but also noted the city will eventually be providing payment to the company — either short–term if the project is cancelled or long-term through the revenue sharing agreement in the contract.

Still being finalized are specifics of the operating agreement in terms of who performs marketing and operations duties, Dahl told Eaglecrest’s board on Saturday. He said a draft agreement expected to be presented to the board soon will make Eaglecrest responsible for operating the gondola, and Goldbelt responsible for marketing it to cruise tourists and transporting passengers to the ski resort.

"Eaglecrest will still have the responsibility or the opportunity to market the experience themselves as we see fit," Dahl said, noting that could include targeting local residents and other non-cruise customers.

Among the discussion points is the ticket price for the gondola, with Goldbelt seeking to charge $85 (not including transport and other fees) that might be bundled with other tour activities such as whale watching, Dahl said. He said studies by city officials elsewhere show $50 to $55 is the average price for similar gondola installations elsewhere.

"But Goldbelt talked about you just have to understand selling something on the cruise ship is different than somebody locally who just wants to go up and a (ride)," he said. "It's a packaged experience. It'll be packaged with something else. They have experience with this and they remain to be completely confident in $85."

Also, Dahl said, a lower price "doesn't return the amount of money that we're hopeful it will push in wintertime operations. And I think that's ultimately the goal."

Mayor Beth Weldon, who was at the retreat during Dahl’s presentation, asked "is there any thing that you're looking at that would be $85 on the cruise, but if you came up here it could be lower, like $60?"

Dahl said Goldbelt is encouraging a season pass option for local residents, as well as a lower walk-up single ticket price.

An economic analysis presented to Eaglecrest’s board in January by former General Manager Kirk Duncan examined how long it would take for the ski area to operate profitably with gondola ticket prices of $45, $65 and $85 ($118, $145 and $171.50, respectively, with bus transportation and cruise line commissions). The analysis stated $85 tickets could allow profitable operations within two years, while $45 tickets might take nearly a decade.

A concern expressed by some Eaglecrest and other city officials is the level of amenities such as shelter and restrooms available to visitors when the gondola opens. Flick’s memo states the $3 million additional cost includes "basic amenities at the top." City Manager Katie Koester told Assembly members last year other facilities such as a ski lodge can be installed as the gondola begins generating enough profits to fund such projects.

“CBJ engineering and Eaglecrest is really taking the project down to what we’ll call the backbone infrastructure, which just is the gondola,” she said during the July 15, 2024, meeting. “So let’s not design the bars and the ski lodges at the top yet. Goldbelt is confident they can sell that destination with a windbreak and some porta-potties because it really is a world-class destination.”

Dahl, in his email to the Independent on Monday, said a detailed project management timeline prepared by DOWL Engineering is still on track.

"The goal is to be able to commission the actual gondola by the end of 2027," he wrote. During 2026 those involved with the project "will be working on tower footings and station foundations and upper mountain road…2027 will focus on the installation of the towers and the gondola itself. Spring 2028 will focus on finishing all the other operational aspects unrelated to the gondola itself."

• Contact Mark Sabbatini at editor@juneauindependent.com or (907) 957-2306.