The government bought the Tanana Valley Railroad, principally for its terminal facilities. The section between Fairbanks and Happy was converted to dual gauge in order to complete the line from Seward to Fairbanks. The government extended the south portion of the track to Nenana and later converted the extension to standard gauge. The Alaska Railroad continued to operate the remaining TVRR narrow gauge line as the Chatanika Branch (the terminus was located near the Yukon River), until decommissioning it in 1930.