A modern fleet of powerful locomotives will pull the Alaska Railroad into the 21st century under a $15 million purchase approved Wednesday by the stateowned line's board of directors.

The board, led by newly elected chairman Johne Binkley of Fairbanks, unanimously approved buying eight new $1.9 million General Motors 4,000 horsepower Electro-Motive locomotives.

No state money will be used to buy the locomotives, which should be pulling cars up Alaska tracks by 1999. They represent the first phase of a five-year, $30 million modernization plan to replace the railroad's 1950s and 1960s locomotives with a smaller, standardized yet versatile 30 locomotive fleet. Of those, 16 will be of the type just ordered.

The railroad currently uses about 50 locomotives with seven different designs.

Bill Sheffield, a former Alaska governor and the railroad's current president, said the potential fuel-savings and improved reliability from using new locomotives was demonstrated this summer when the railroad brought in two of the GM machines for tests.

"We know it means better service for our customers. We know they like that," said Sheffield, noting the new GM locomotives can pull twice the weight of the railroad's current equipment.

The pair of six-axle GM locomotives proved capable of moving gravel trains that require as many as five of the railroad's older locomotives to budge, Sheffield said. The new locomotives can also travel for days without refueling.

Dale Morman, president of Anchorage Sand and Gravel, confirmed the effectiveness of the test units hauling his company's daily 80-car loads.

"We have seen significant improvements in the area of being on time, and a lot of that results from the field testing of the new locomotives," Morman said in a telephone interview. "As a customer, it seems to be a good addition to the railroad."

The decision to approve the locomotive purchase came as the independent board appointed to oversee the railroad met at the Fairbanks Princess Hotel.

The first order of business Wednesday was filling the board chairmanship vacancy created by Sheffield's resignation in July to accept a new post as the railroad's chief executive.

Binkley, a former state legislator appointed to the board by Gov. Tony Knowles in 1995, was chosen without objection to serve as the new chairman. He is the first Fairbanks resident named board chairman since the state assumed control 12 years ago from the federal government, which laid the first tracks in 1923.

"We need to look to growing out business and to providing opportunities to grow other businesses in Alaska by utilizing the assets we have," said Binkley, a 44-year-old riverboat captain and developer of El Dorado Gold Camp.

Binkley takes over a railroad that some lawmakers would like to sell despite two years of record profits. Board members have funneled those profits into rail improvements and debt service, slashing the railroad's long-term debt from $19 million in 1995 to $1.8 million today.

"I see debt as more of a problem than a solution," commented Dale Lindsey, a board director, as he advised the railroad staff to finance the locomotive purchase with greatest possible cash down, so as to minimize new debt.

"It's a significant expenditure for this corporation," Lindsey said, "but its clearly in the right direction."

Sheffield announced he will form a committee, with union representative to smooth the transition to the streamlined locomotive fleet, which will require fewer engineers to operate.

The purchase is the culmination of a year-long railroad shopping mission, in which the line's management weigh the current benefits of overhauling the current fleet against leasing or buying  new locomotives. Purchasing 16 new locomotives over the next five years emerged as the most cost-effective recommendation the staff concluded, based on expected savings in fuel, maintenance and labor.

Binkley said that recommendation was borne out during his recent inspection of Outside railroads using the GM locomotives.

"We went to Nebraska rode these units as they hauled coal up grades there, then we headed into the shops and talked to the mechanics," recalled Binkley, who heard nothing but praise about the locomotive's performance.

"It's an exciting time."