Elwood Brehmer

AIDEA approves $37.7M Interior Gas Utility loan

The Interior Gas Utility got approval for a $37.7 million construction loan from the Alaska Industrial Development and Export Authority board at a special Feb. 5 meeting.

With several members attending via teleconference, the board unanimously approved the loan for development of the utility’s natural gas distribution system.

AIDEA will fund the loan from the $332.5 million Senate Bill 23 Interior Energy Project financing package it was authorized to use towards getting natural gas to the region.

Walker cuts $170M, 300 positions in budget

Gov. Bill Walker released a proposed fiscal year 2016 operating budget with $5.2 billion in general fund spending.

The governor’s budget plan released Feb. 5 also eliminates 300 state positions next fiscal year that begins July 1.

The unrestricted general fund amount is $4.6 billion, about $170 million less than the current fiscal year 2015 unrestricted spend, a 3.6 percent cut.

Walker said state employee layoffs would be minimized to the extent possible through eliminating vacant positions and not filling others as they open up.

CIRI settles long-running dispute over Kenai Loop gas fees

The fight over Kenai Loop natural gas appears to be over.

Attorneys for all four parties currently involved in the dispute — Cook Inlet Region Inc., the Alaska Mental Health Land Trust Authority, the Department of Natural Resources, and AIX Energy LLC — signed a joint request for dismissal Jan. 23 of the ongoing hearing in the Alaska Oil and Gas Conservation Commission related to the case.

CIRI Vice President of Land and Energy Development Ethan Schutt said the Southcentral Native corporation had an agreement in place with AIX for a couple weeks.

Construction forecast positive in short term with 3% dip

The state budget may be grim but Alaska’s construction industry as a whole should have another good year, according to a University of Alaska Anchorage Institute of Social and Economic Research forecast.

The 2015 construction outlook predicts a total spend of more than $8.5 billion statewide. That would be a 3 percent decline from the revised 2014 projection of $8.8 billion worth of construction activity in Alaska.

Alaska Air Group has 5th straight record year, profit up 49%

Quarterly or yearly, record-breaking profits are officially old hat at Alaska Air Group Inc.

During a Jan. 22 call with investors, executives of the parent to Alaska Airlines and Horizon Air reported a record full-year profit of $571 million in 2014 and a fourth quarter record profit of $125 million.

The net income figures exclude special items.

It is the fifth consecutive record-breaking year for Alaska Air Group and the 10th record quarter in the last 11. It is also the 23rd consecutive profitable quarter for the company.

State funds in slashed capital budget down 91% from 2013

Gov. Bill Walker’s capital budget is short, but not very sweet.

The total proposed capital spend would be $1.4 billion under the governor’s proposal; of that, $150 million would be unrestricted state general funds.

While federal dollars always make up a large share of the state capital budget, general fund spending is the real indicator of the state’s situation. The $150 million in Walker’s initial budget is a 71 percent decrease from the current 2015 fiscal year unrestricted capital spend of $510 million.

AIDEA begins broadening Interior gas search

The transformation of the Interior Energy Project has begun. This time, a Cook Inlet gas source is a real possibility.

With the Alaska Industrial Development and Export Authority back on its own in the endeavor to get natural gas to the Fairbanks area, the AIDEA board passed a resolution Jan. 14 authorizing staff to spend $700,000 to investigate a new path forward for what was, and still could be, a plan to truck liquefied North Slope natural gas south.

Anchorage office market hesitant, retail future bright

Commercial realtors, like many folks in Alaska, are waiting to see how slumping oil prices will affect their industry in the coming year.

“Everyone’s anxious; there’s a lot of nervousness. But, the truth is, you don’t just close your business down because oil prices slip,” Reliant LLC manager Ted Jensen told members of the Building Owners and Managers Association Anchorage Jan. 9.

Walker fires DOT commish after road report

Gov. Bill Walker fired Alaska Transportation Commissioner Pat Kemp Jan. 12 after he urged Walker to move forward with the Knik Arm bridge and the Juneau access road projects, or face repaying up to $98.6 million to the federal government.

Walker spokeswoman Grace Jang wrote in a statement to the Juneau Empire that the governor wants department commissioners aligned with his priorities.

Status reports on three of the state’s biggest and controversial road projects were released Jan. 9 by Walker’s office.

State shifts from 404 primacy to wetlands mitigation options

State agencies are collaborating on ways to improve wetlands permitting despite funding cuts.

What was once an investigation into whether or not the State of Alaska should try to assume primacy over Clean Water Act Section 404 wetlands permit reviews has morphed into a look at developing a broader “404” program.

Interior Energy Project on hold as MWH declines extension

After a year-and-a-half of work, time has run out on the Interior Energy Project — at least for now.

MHW Global Inc., the Alaska Industrial Development and Export Authority’s partner in the plan to truck North Slope-sourced liquefied natural gas to the Fairbanks area, withdrew its request for an extension to its contract on the project in a Dec. 30 letter.

Retail growth signals a strong economy says AEDC

It’s no secret that Alaskans love to shop.

A quick Saturday stroll through one of Anchorage’s many malls verifies that.

“It is very impressive in a $50 billion or so state economy — before the collapse of the price of a barrel of oil — that we see retail is $6.1 billion out of that,” Anchorage Economic Development Corp. President and CEO Bill Popp said at the Jan. 5 Make it Monday forum hosted by the Anchorage Chamber of Commerce.

Uncertain year for mega-projects as Walker halts spending

How little can the state afford to spend?

Gov. Bill Walker halted immediate spending on six of the state’s notable pending mega-projects Dec. 27, part of an effort to scrutinize all expenditures and minimize the fiscal year 2016 budget deficit.

Walker’s administrative order stopped work on a road to the Ambler Mining District; the Juneau access road; the Susitna-Watana Hydro project; the Knik Arm bridge; the Alaska Stand Alone Pipeline; and the Kodiak Launch Complex.

Anchorage sues feds, requests $350M for new port design

Another year began with another lawsuit in the Port of Anchorage saga, but it ended with the promise of progress as well.

The Municipality of Anchorage filed suit against the U.S. Maritime Administration, or MARAD, Feb. 28 in Federal Claims Court, an effort to recoup damages the city claims it is owed for the failed port expansion project that spanned 10 years and yielded little for the more than $300 million spent on the 53-year-old port.

Judge dismisses most claims in King Cove road lawsuit

A federal judge dismissed a majority of a lawsuit brought against Interior Secretary Sally Jewell in an attempt to get a King Cove emergency access road built.

U.S. Alaska District Court Judge H. Russel Holland dismissed four of the five claims Dec. 19 brought by seven plaintiffs that include the Aleutians East Borough, the City of King Cove and area Native groups.

Parallel claims by the State of Alaska as an intervenor in the case were also dismissed.

Interior Energy Project remains in limbo

Self-imposed deadlines have come and gone and the future of the Interior Energy Project is in doubt.

Project team members from the Alaska Industrial Development and Export Authority and its partner firm MWH Global Inc. were unable to present the AIDEA board of directors with a financial package to move the energy plan forward at its Dec. 16 meeting.

Dec. 16 was the most recent date circled by the Interior Energy Project team as its target to have agreements in place with all the project stakeholders. The close had been pushed back from a previous goal of early November.

Most ferry rates going up; day boat work gets underway

The cost of your favorite state ferry trip is likely going up.

Fares for most Alaska Marine Highway System routes will increase 4.5 percent Jan. 1 or shortly thereafter, deputy state Transportation Department commissioner Reuben Yost said during a Dec. 12 Marine Transportation Advisory Board meeting.

The fare increases will first affect the 2015 summer schedule, Yost said, which begins May 1.

Trips planned before the new rates are released for the upcoming spring and summer will not be impacted.

Capital budget cuts leave large projects unfunded for now

When Gov. Bill Walker released a bare bones capital budget Dec. 15, opponents of the state’s major infrastructure projects hailed the move.

Walker pulled $114.3 million from the “work in progress” capital budget of former Gov. Sean Parnell that Walker released without endorsement Dec. 5.

State says revenue to get worse

The bad budget news keeps coming.

The Alaska Department of Revenue is predicting unrestricted general fund revenue of $2.6 billion for the current 2015 fiscal year. For the 2016 fiscal year the outlook is worse; the state is expected to take in $2.2 billion in unrestricted cash.

By comparison, the state took in $5.4 billion of unrestricted revenue in fiscal 2014, which ended June 30. The State of Alaska’s total revenue for fiscal 2014, including investment income, was $17.2 billion.

The state released its forecast Dec. 10 in the Revenue Sources Book Fall 2014.

Knik bridge study indicates minimal population impact

Other than changing the view to the north, the Knik Arm Crossing would not impact the look of Anchorage much at all, even in the long term, according to the latest study of the proposed bridge released Dec. 8.

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