Proposed Wrangell shipyard project gets boost as Assembly OKs 3-year tidelands lease
- Wrangell Sentinel
- Mar 4
- 2 min read
By Jonathon Dawe
Wrangell Sentinel
The Wrangell borough assembly on Feb. 24 unanimously approved a three-year lease with JAG Marine Group, giving the company time to decide if it will proceed with development of a shipyard at the 6-Mile Mill property.
The shipyard would be the foundational component of a larger redevelopment plan for the former mill property, which also includes a new barge ramp and freight yard and a privately operated small data center.
Borough Manager Mason Villarma told the assembly that the short-term lease is a strategic necessity to ensure the partnership with the company gains momentum. He said the agreement positions the borough and JAG to be “technically, financially and strategically ready” to compete for substantial state and federal investments.
The borough has applied for a federal grant of tens of millions of dollars to pay for roads and utilities to the 6-Mile property, and JAG and the borough are jointly funding a $750,000 feasibility study of the shipyard project.
The three-year lease, which starts March 1, functions as a placeholder while both parties navigate the complex tasks of design, engineering and financing. According to the plan, the goal is to establish a state-of-the-art shipyard at the borough’s deepwater port.
By approving the lease, the borough ensures that JAG remains committed to the location while pre-development activities continue, Villarma explained.
Under the lease, which covers 25 acres, JAG would pay the borough an annual fee of 10% of the property’s value, which would be determined by an independent appraisal.
The three-year lease also says the borough and JAG would work toward a lease of at least 40 years if the project goes ahead.
The agreement includes a “revenue generation trigger,” which says negotiations on a long-term lease would start when the company generates its first revenues at the site. The future contract is expected to follow a revenue-sharing or dividend-based model, ensuring the borough directly benefits from the facility’s commercial success.
Assembly Member Jim DeBord praised this financial structure during the meeting.
“I like that provision in the lease about revenue sharing. That’s smart,” DeBord remarked. “That means that if JAG is doing good, then we’re doing good.”
Wrangell’s port commission, planning and zoning commission and economic development board all endorsed the three-year lease.
In its application, JAG detailed an ambitious vision for the site. The company plans to operate a full-capacity shipyard capable of fabrication, construction and repair for vessels measuring up to 600 feet in length.
JAG already operates shipyards in Ketchikan and Seward, and with maritime construction operations in Michigan and Virginia.
Co-owner Tim Jagelski Jr. has highlighted the project’s potential to service high-priority ships, including U.S. Coast Guard icebreakers.
As the maritime industry looks for more specialized repair facilities, this project could place the borough at the center of the North Pacific’s shipping and defense support network, according to borough officials.
• This article originally appeared in the Wrangell Sentinel.
