Editorials

EDITORIAL: Alaska needs the best to serve in judicial branch

Alaska has three branches of state government: Executive, headed by Gov. Sean Parnell; legislative headed by Senate President Gary Stevens and House Speaker Mike Chenault, and judicial, headed by Chief Justice Walter Carpenetti, who is one of five members of the Alaska Supreme Court. That tells you how important to Alaska and Alaskans selecting another Supreme Court Justice is. There are only five. History shows that most members take a turn as the chief justice. Currently, there is a position on Alaska’s highest court because of Justice Morgan Christen’s appointment to the Ninth Circuit Court of Appeals. The Alaska Judicial Council advertised for applicants to fill the position vacated by Morgan, and 14 attorneys and judges from around the state applied. They include: Joel H. Bolger, an Alaska Court of Appeals judge; Jeffrey Friedman, an administrative law judge in Anchorage; Andy Harrington, an assistant attorney general in Fairbanks; Charles T. Huguelet, a Kenai Superior Court judge; Michael A. MacDonald, a Fairbanks Superior Court judge; Frank Pfiffner, an Anchorage Superior Court judge; Eric Smith, a Palmer Superior Court judge, and Terry L. Thurbon, Chief Administrative Law Judge in Juneau. Also applying are the following attorneys in private practice: William Grant Callow, Kevin G. Clarkson, Peter J. Maassen, Don McClintock, and Marc Wilhelm, all of Anchorage, and Daniel Westerburg of Homer. Each applicant will be interviewed by the Alaska Judicial Council, which includes the chief justice, three attorney members and three lay members. They will come up with a list of applicants who are most qualified — a minimum of two — and forward those names to the governor. The governor will interview the finalists and make an appointment within 45 days of receiving the finalists’ names. Part of the process involves the public. Specifically, the public is encouraged to comment on the qualifications of the candidates. The public comment is considered by the Judicial Council during its evaluation of the candidates. Alaskans with information supporting or opposing appointment of any of the applicants would send their comments to Larry Cohn, executive director of the Judicial Council, 1029 W. Third Ave., Suite 201, Anchorage 99501. All information provided to the council is helpful. It’s also critical to not only one of three branches of Alaska government, but to Alaskans who live by the decisions of the Supreme Court. We want the best of the best interpreting Alaska law. If you can help Alaska be its best by offering information, then please comment.

EDITORIAL: Alaskans — and lawmakers — should plan for growth

Alaskans heard Gov. Sean Parnell’s State of the State address to the 27th Alaska Legislature recently. It was more than a good speech, perhaps his best to date, but in it, he charted a course for faster growth and greater opportunity for Alaska and its people. He pointed out five critical areas. Gov. Parnell is a fiscal conservative. His intent is a balanced budget, holding down government spending and increasing savings. His proposed budget reduces expenses by $856 million, but includes $1 billion for infrastructure projects — such as airports, harbors, roads and the Alaska Marine Highway System. As a result, 288 vacant government positions will be eliminated. Oil provides 90 percent of the state’s revenue. Gov. Parnell favors efforts to encourage more private investment in oil production. The amount of oil flowing through the Trans-Alaska Pipeline is down from 1 million barrels daily to 650,000. Some experts say the pipeline will shut down when it reaches 300,000; others say 100,000, according to Parnell. But, with oil clearly being what fills the state coffer, neither is acceptable. Also, with the declining oil flow, it is the high price of oil that makes up for the loss. If prices decline faster than the private sector can explore and develop new oil, Alaska might have to tap into its savings earlier than expected. This is avoidable — if Parnell and the Legislature act this session. Any delays only increase the likelihood of financial peril in the not-too-distant future. Gov. Parnell’s goal is 1 million barrels a day. It will require lawmakers to produce oil tax reform legislation. With reform will come at least $5 billion in new investments promised by the oil industry. The permitting process likely will need to be streamlined as part of the effort to realize more oil flowing through the pipeline. Beyond oil, Alaska has abundant sources of natural gas — more than 200 trillion cubic feet. A natural gas pipeline needs to be built to direct this energy to market. In the process, an opportunity to provide reduced-cost heating to Alaska homes and businesses can be created. But oil and gas aren’t the only natural resources Alaska has to offer. This state has the world’s best seafood; its mining industry supports more than 5,500 jobs, with the potential for many more as Alaska’s deposits of rare earth elements are explored and developed. The Parnell administration continues to assist the timber industry. It has opened up more land for timber harvest as a result of expanding the Southeast State Forest. Finally, Gov. Parnell is looking toward increasing opportunity for Alaska’s small businesses. It is helping new businesses to launch more quickly and with better access to capital. It has increased its tourism marketing in hopes of businesses seeing greater customer response. All of this will be backed up with the governor’s unceasing commitment to education. He touted the success of his Alaska Performance Scholarship program, which has given students incentive to perform at higher levels of achievement. He asked the Legislature to create a fund for the $400 million set aside last year for the program, allowing for its earnings to continue to replenish the scholarship fund. He also is committed to providing funds for five of the highest-priority rural school projects. Perhaps the Legislature will add to his generosity by increasing the base allocation its gives school districts for students. The key to building Alaska is developing its natural resources. It’s a natural-resource state, with oil, gas, minerals, seafood and natural beauty. It also has untapped potential studying in its schools. Gov. Parnell can see the future and has set a path for Alaska to follow this year and in years to come that will keep the lights on and the “open for business” sign illuminated. Alaskans should follow his lead.

EDITORIAL: Progress made in village public safety officer program

Gov. Sean Parnell told the Alaska Federation of Natives in 2009 he would put a law enforcement officer in every village that wanted one. In subsequent years, the Legislature has agreed to build up annual funding for village public safety officers in an effort to fulfill the governor’s pledge. Filling the positions has been more difficult, but the state must keep trying to do so. The village officers encourage safer, more law-abiding communities in rural Alaska. People in these communities are begging for help. Progress was encouraging last year. As reported Jan. 22 in the News-Miner, the state hired 15 new village public safety officers statewide, meeting the governor’s annual goal. Recruitment of new officers is up, too. Thirty-eight people are training at the Public Safety Academy in Sitka this year, up from 19 in 2008. The shortage of officers seems particularly acute in the Interior. Only six Interior villages have VPSOs today — Arctic Village, Beaver, Eagle, Huslia, Ruby and Tanana. Recruits for Northway and Tetlin should fill positions shortly. And Tanana Chiefs Conference, which manages the Interior regional program for the state, is working to get positions filled in a few more locations. There’s plenty of room for growth, though. The Interior has 43 villages. Some of those 43 are too small to justify a full-time VPSO, but certainly the program should provide staff in more than eight villages. Village public safety officers aren’t state troopers, but they can serve as trained and objective authority figures when needed. Those who live in communities are immediately available to respond to crimes. Living in the villages, they can establish a rapport with local people and leaders that often is difficult for troopers to achieve. They also are cheaper to employ than troopers. The state must continue to build on this effort. It’s by no means the answer to all the troubles in villages, but it’s an essential first step.

EDITORIAL: Young's bill for Alaska Native veterans is late, but right

It’s better late than never to do right by Alaska’s Native veterans. Congressman Don Young has introduced the Alaska Native Veterans Land Allotment Equity Act. It would amend the Alaska Native Claims Settlement Act to allow about 2,800 Natives who served in Vietnam to reapply for their Native allotment. They missed an earlier opportunity because they were in the armed services during the war. “This is an issue of what is right and what is wrong,” says Young. “My bill will finally provide a chance for Alaskan Native Vietnam veterans to obtain land promised to them under ANCSA. It’s a shame that decades later, these honorable men and women are still waiting to receive what’s been promised to them.” Current obstacles to the allotments include: • These vets can apply only if they served on active duty from 1969 to 1971, even though the war started in 1964 and ended in 1975. • The vets must prove they used the land in a continuous and independent manner, exclusive of others, for five or more years. This wasn’t required in the Native allotment act. Nor was it required of other Native applicants. It seems appropriate that Native veterans who participated in the earliest or final years of the Vietnam War be included in participation of the land allotment equity act, and that they be treated like all other Natives as spelled out in the act. Veterans should be treated at least as well — Native or not — as other Americans. Certainly, they shouldn’t be penalized for taking time away from their families and careers to serve this nation.

EDITORIAL: Time to move beyond talk as legislative session starts

We’re off to an interesting start on what could be an historic year. Already this year Gov. Sean Parnell has gathered a room full of movers and shakers, with the CEOs of Alaska’s big three oil companies, to talk about the potential for a natural gas pipeline to produce liquefied natural gas for sale in the Far East. It’s in keeping with his commitment to do what it takes to refill the trans-Alaska oil pipeline with 1 million barrels of oil a day. And the opening round in a legislative session that starts this week in Juneau with some big expectations and bigger challenges. This is the leadership we need from the governor. Great things always start just such a vision. Connecting the dots, moving from vision to action, will be a larger undertaking. The Jan. 6 Meet Alaska conference, the annual gathering of the Alaska Industry Support Alliance, got down to detail and to reinforce the need for a change in tax law to attain that goal.  Specifically, BP Exploration (Alaska) Inc.’s John Minge said that only a big change in Alaska oil tax policy will bring more oil company investments to the state. And that it will take a $150 billion investment from those players to generate those million barrels a day. The state Department of Revenue’s Bruce Tangeman was equally emphatic, saying that only radical changes, not just a few tweaks on the oil tax’s reciprocity, will bring that investment to Alaska. Is it the right time? Clearly the vast majority of Alaskans, in and out of the oil business, want action. Alaska’s Clear and Equitable Share, ACES, was passed in large part because the timing was right, because both voters and legislators agreed the state deserved a bigger share of oil profits. They united behind then-new Gov. Sarah Palin to demand a bigger cut for the state. And in the final version of ACES, the Legislature demanded even more. The whole process happened in weeks, really just days, so it’s reasonable to expect it was a bold but imperfect draft. It was also based on a lot of projections. It made great sense in 2006. Does it still? Aggressive taxation may have made sense when there were fewer alternatives to Alaska oil. That is no longer the case. Now it is time to review five years of history under ACES, with real data, and work to improve the plan. There seems almost universal agreement it’s got to address reciprocity and reward both exploration and production, with rewards for both the state and the oil companies. It’s got to be a win-win for the industry, Alaskans and Alaska businesses. It can’t abandon the expectation that Alaskans get a fair return. The next generation of Alaska oil tax codes has to continue to protect the 90 percent of Alaska’s operating revenue that oil generates. We also have to understand that the more radical the proposed changes, the less chance we can expect agreement in the Legislature. It’s not said often enough that ACES hasn’t been all bad for the state. During these last few brutal economic years, when most of other states are sinking deeper into bankruptcy, Alaska has added billions to our reserve.  BP’s Minge pointed out last week that the oil industry makes billion-dollar decisions based on expectations 50 years into the future. We need to have that same 50-year vision for the state. Is it realistic that any new oil program works whether oil is selling at $80 or $180 a barrel, and whether gas is $2 or $10, whether the customer is China or the Lower 48? Time will tell. The perception is that Legislature does most of its work in a flurry at the end of the 90-day session. Let’s not waste those 90 days this year. Lawmakers have heard for months – since well before the 2011 session – that ACES needed changing, that the big producers won’t invest the big money to find and produce new oil in the current tax environment. Alaskans share an expectation — that their elected officials will do their jobs, will work together and compromise to make real and positive legislation to benefit all Alaskans as well as to the businesses that provide us the economic benefits we have come to rely on. That meaningful work must begin from Day 1 of the session. Lee Leschper is Alaska regional vice president for Morris Communications publications including the Alaska Journal of Commerce. Email him at [email protected]

COMMENTARY: Over-the-top route minimizes natural gas benefits to Alaskans

Article VIII, Sections 1 and 2 of Alaska’s Constitution mandate that “Alaska’s resources are to be developed to the maximum use and benefit of its people.” Following the discovery of oil on Alaska’s North Slope in the late 1960’s, we Alaskans held our breath watching the daily progress of the ice breaking oil tanker, the SS Manhattan, as it carried a single barrel of North Slope crude oil towards the New York Harbor.  Although it ultimately reached its destination, we cheered at the announcement that this route was a non-commercially viable option for moving Alaska’s oil off the North Slope. Soon thereafter the construction of the Trans-Alaska Oil Pipeline System commenced and thousands of Alaskans went to work. All of the development resulting from the construction of the oil line and the decades of commercial activity across Alaska are a direct consequence of that oil line running 800 miles through Alaska. Development for the “maximum benefit of Alaskans” was accomplished. This same rationale led the late Sen. Ted Stevens to secure the passage of federal legislation to prevent Alaska’s gas from being taken off the North Slope via Exxon’s proposed “Over the Top” gas line destined for Canada without traversing Alaska. The Alaska Legislature passed a similar law for the very same reason. Just like the oil, if Alaska’s gas left Alaska from the North Slope via an over the top gas line or an LNG tanker, the benefits to Alaskans would be minimal.  Fortunately our delegation and legislature have long recognized this option would not deliver the “maximum benefit of Alaskans.” Alaska’s historical approach is not an anomaly. Alberta long ago passed a law requiring that natural resources could not leave the province without first being made into a product. This value added requirement created the bulk of Alberta’s natural resource jobs. It is with this backdrop of history that I was shocked to learn from a Houston oil and gas reporter in a recent interview that there are current elected officials in Alaska considering options whereby Alaska’s gas would be transported directly from the North Slope. Are these officials not aware that for decades we fought united as Alaskans for as much benefit from the development of our resources as possible and passed laws to ensure that happened? It is for the jobs and lower cost of energy that we must continue to fight that fight. The recently released Wood Mackenzie report showed that LNG from Valdez could be delivered nearly one-third cheaper to the Asian market than that from the LNG project being developed in Kitimat, British Columbia. While Kitimat is signing up customers, are we really considering a project that would not bring Alaska’s gas through Alaska? Clean burning natural gas delivered to Alaskans from a large volume line with an LNG export component would be magnitudes cheaper than any other option. Without this, how do we get affordable energy into the Interior communities? How do we protect against another run at mothballing our Interior military bases due to high energy costs? How does LNG leaving Alaska’s North Slope help the cost of energy in Bethel? This winter it is anticipated that the cost of heating oil in Bethel will exceed $40/mmbtu as compared to less than $3 for the same unit of energy in the Lower 48. It is not just the amount of money that goes into state coffers that defines the “maximum benefit to Alaskans.” The quality of life for Alaskans as measured by employment and affordable energy for homes and businesses must also be of primary concern. In 2002, 138,000 Alaskan voters (62 percent) were right when they voted for the All Alaska gas line. They are still right today. And I am confident they join me in urging our elected officials to not embark on yet another study that will ultimately conclude that a deep draft LNG tanker could not load LNG from the North Slope’s ice packed, shallow shores. Exporting Alaska’s jobs and future off the North Slope leaving behind no relief from high energy costs and a high unemployment rate offends Alaska’s constitution and the very people it was intended to protect. Bill Walker owns an Anchorage law firm that focuses largely on oil and gas and municipal law and serves as general counsel for the Alaska Gasline Port Authority. He ran for governor in the 2010 Alaska Republican primary.

COMMENTARY: Why natural gas to liquids for Alaska? National security

Alaska, the only North American region partially occupied by an enemy during World War II, and a bastion of defense during the Korean Conflict and the Cold War has the opportunity to again serve our nation during troubling times. The Department of Defense is actively researching and even implementing the concept of “single fuel” to substitute for gasoline, diesel, and aircraft (including JP) fuels. The concept makes sense, as manufacturing, storing, transporting and utilization of a number of different liquids is expensive and cumbersome. Enter the Fischer-Tropsch (or like) processes gasifying and then processing various materials to useable liquids. The F-T technology is not new nor is it not being utilized. Natural gas to liquids (GTL), coal to liquids (CTL) and biomass to liquids (BTL) are being developed throughout the world. This access to vast quantities of aircraft, vehicle, vessel and small engine fuels is critical; doubly so, as the Iranians, in a show of saber rattling, are letting the world know they can disrupt, if not stop, trafficking crude oil through the Straits of Hormuz, the narrow opening of the Arabian Gulf to the Indian Ocean. Others, in the event to hostilities could intercept and slow vessel traffic through the Straits of Malacca, the shallow passage south of Singapore, the route to the Pacific Ocean. A GTL (or CTL) plant in Alaska, while utilizing conventional transportation and storage within the state, could also fulfill military desires throughout the Pacific Basin. Alaska, with its vast quantities of coal and natural gas should enter this field, both to service domestic needs, but also to support the nation’s military mission in the Pacific Basin. As the state and industry continue to ponder a natural gas line to the Lower 48 and Liquefied Natural Gas (LNG) is pushed, both into questionable competitive markets, Alaskans continue to suffer under extremely high petroleum fuel prices. Strategically located Alaska has the potential of delivering completed fuel at a shorter distance, and more secure routes, than any other domestic region; and far more reliable and safe than from foreign sources. For example vessels traveling from Alaska to a forward base at Guam can be shadowed and protected by the U.S. Navy and land based aircraft. The following table depicts these distance and security advantages:                                                             Nautical Miles From-To                                              One-way                 Round trip Cook Inlet to Guam (direct)                 4,028                        8,056 Cook Inlet to Guam (via Adak)            4,153                        8,306 Adak to Guam (direct)                         3,048                        6,096 Valdez to Guam (via Anacortes)         6,137                       12,274 Valdez to Guam (via Los Angeles)     7,374                        14,748 Not only does Alaska (from either Cook Inlet or Valdez) offer greatly shortened distances to the important American military facilities at, for example, Guam, Alaska also offers a major fuel caching point on the Island of Adak, at the apex of the Pacific Ocean. The other routes (via Anacortes, Wash., or Los Angeles, require Alaska crude oil to be transported to refineries to be converted to various fuel, then shipped across the ocean. The Fischer-Tropsch refinery in Alaska would directly ship completed liquid fuels. Alaskans, as well and the entire nation, can benefit from our in-state natural resources; and again, our strategic location. To do this will require a shift of policy regarding the future of utilization of Alaska’s resources. With the state legislature shortly going into session, and threats to the security of the United States, there is no time to waste in seriously considering the future of the non-polluting F-T fuels. Terry Brady is a 50-year plus Alaskan who has consulted on natural resource issues and transportation throughout North and Central America, the Far East and Europe. He was formerly a top-secret cleared member of the Armed Forces Special Weapons Project and maintains an interest in national security.

EDITORIAL: Protect halibut, relationships while seeking solutions

Homer is fortunate. While fish wars have bitterly divided other Alaska communities, Homer’s commercial fishing and sport charter fleets have been able to avoid most of the acrimony that’s found in other fishing towns. Maybe part of the reason has been both industries have fared fairly well over the years. After all, they both operate out of the “Halibut Capital of the World,” and more times than not there seem to be plenty of fish for everyone. Sure, there have been allocation disagreements between the two sectors and not everyone agrees about which halibut holds the most value for Alaska — the one caught by the commercial fleet or the one caught by the charter fleet — but, for the most part, commercial and sport fishers on the southern Kenai Peninsula remember that they are neighbors. They treat each other civilly. They recognize both industries are integral parts of the unique weave that’s the fabric of Homer. City officials have been careful not to favor one sector over the other. News coming out of the International Pacific Halibut Commission drastically changes the halibut landscape, however, and threatens both sectors of Homer’s fishing economy. Biologists have been overestimating the exploitable halibut “biomass,” or the total number or halibut that can be fished, for a number of years. The 2012 recommended catch limits in Area 3A, or southcentral Alaska including Homer, were cut 17 percent for commercial fishermen and 15 percent for charter fishermen. It’s too early to tell precisely what it means for either group — but fewer halibut will hurt Homer. Period. High prices that have helped the commercial fleet in recent years won’t be enough to make up for fewer fish. The charter fleet will struggle with the one-halibut limit that likely will be the result of the IPHC news. And the rest of the community will fare as well (or as poorly) as those two sectors of the economy. The news puts Homer at crossroads. As a community, we can whine and wring our hands about the unfairness of it all, we can play the blame game or we can make some decisions that move us in new directions. Some thoughts about the latter: • As a community we need to advocate for conservation measures above all else. We’ll have neither a commercial fishing fleet nor a sport charter industry without protecting the halibut and making sure future generations can have livelihoods commercial fishing and guiding sport anglers. • Homer’s commercial and charter fleets can create a new model for the rest of Alaska’s fishing communities by taking the lead and working together to promote conservation measures for their own good — as well as the collective good of the community. • We need to rethink our moniker as “the halibut capital of the world.” While Homer and halibut are almost synonymous, there’s a whole lot more than halibut to fish for and it all makes for great meals — and experiences. We’re with our resident fish expert Nick Varney, who promoted the value of Pacific cod in one of his columns last summer: “... (C)od has a nice white flesh with a slightly sweet taste and is more moist than halibut. It costs mega bucks less at the store and keeps much better in the home freezer, especially when compared to salmon.” There truly is more than one fish in the sea surrounding Homer. • While Homer is and always will be a fishing town, we need to continue our efforts to let visitors and others know there’s much more to us than fishing. Our community identity should never rely on just one resource. The flavor of Homer is its unique mix of fishing, arts, recreational opportunities, culture, wildlife, wilderness, scenic beauty and the people who live here. • Even before the latest news from the IPHC, the Homer Chamber of Commerce was making changes to the Homer Jackpot Halibut Derby. The chamber, which relies heavily on proceeds from the derby, has a lot at stake, but it recognizes its leadership position in the community. In this case, it knows the conservation of the halibut comes first. • Finally, as we figure out what the halibut news means we should work as hard to protect our relationships within the community as we do to protect the halibut. As the adage goes, the bad news can make us bitter or it can make us better. We vote for the latter. Let’s let this bad news bring us together in search of better ways to build our community. There’s a lot more at stake here than halibut.

Let us see the U.S. Supreme Court at work

We — all of us — should be able to watch the U.S. Supreme Court in action, and legislation has been introduced in the Senate Judiciary Committee to allow it. Fifty out of 307 million Americans can — if they get in line a day or two in advance of a particular case being argued before the justices. That leaves 306,999,950 Americans out in the cold. It isn’t all warm and cozy for the 50, either. They get to stand in line outside court for from 24 to 48 hours in hopes of a chance to see and hear the arguments. Hardly makes the public feel welcome. And, while we’re shivering or sweltering in our boots or sandals, depending on the season, the court is deciding how our laws are to be interpreted. Of particular current importance is the health care reform case coming before the court in the spring. The outcome will be whether Americans can be forced to buy health care insurance. It seems like we might not only be interested in hearing and seeing the arguments on both sides of the issue, but that we should be interested. And what a tremendous opportunity to learn about how our justice system conducts itself; schools and teachers should be preparing lesson plans around viewing the proceedings. The arguments should be broadcast across the nation by C-Span. Alaska’s Supreme Court allows TV cameras to broadcast arguments. Rules for camera behavior are set ahead of time, recognizing that it is important that the cameras and their operators don’t disturb the proceedings. If Alaska can come up with rules to give all Alaskans access to the highest court in The Last Frontier, then the U.S. Supreme Court — also experts in laws — should be able to do the same for the highest court in the land. Apparently, the U.S. justices fear sound bites being taken out of context. But print reporters take text equivalent to sound bites (quotes) all of the time. They do it responsibly. We believe TV can act accordingly. A transcript or recording of the arguments will be available to set the record straight, if necessary. And C-Span would show the proceedings in their entirety for the most interested Americans. While the court distributes an audio recording of its proceedings a few days after an argument, that isn’t likely to reach the ears of most Americans. It certainly doesn’t allow them to get to know the justices and other courtroom participants. In the interest of open government, it’s time for the justices to let us see with our own eyes what is going on in our highest court.

Renewed sense of optimism for Inlet exploration

It seems there is no end to the good news coming out of Cook Inlet these days. For a long time, all we heard about was the decline of the industry that had for so long been the buoy for our area — oil, gas and energy. That perhaps there weren’t the resources left, or that the investment wasn’t worth the financial risk. But, now more than ever, it seems that perception is reality in the Inlet. Like the residents who believed in its potential, who knew it so well, the companies discovered the same. Escopeta says it has discovered 3.5 trillion cubic feet of natural gas in the Kitchen Lights Unit north of Nikiski during initial drilling and that news has caused ripple effects throughout the community, once again lifting the hopes of residents and producers alike. Gone for the most part are the days of the major producers relying on older wells. Instead a host of smaller companies are eager to explore, test and prove up the resources in the Inlet. And what they are finding is what we hoped — our offerings are still flush. There is a flurry of conversation about what companies are doing, where they are looking and what tests are being done. Each time they find something, each time progress is made, each time a well proves up it betters the environment — economically and socially. Jobs, energy security, economic stability, things that our community used to take for granted we can feel comfortable looking for again. The excitement seems to snowball, drawing more interest from other smaller companies. Good news leads to a renewed sense of optimism of exploration and we’re thankful that spirit is alive and well once again. As things develop and companies have resources to get to market, we need to remember that we shouldn’t stand in the way. Our local and state legislators and officials should make it a priority to assist in the clean and responsible development and production of these discoveries. A great deal of infrastructure and planning is likely needed and therefore a great amount of headache could follow, which we should seek to minimize at all levels. As a community we’ve done a good job of building up excitement and interest in our resources, been lucky enough those hopes have started to materialize in the form of discoveries and now we need to make sure we are being as business friendly as possible. In short: We’re continually encouraged by the news coming out of the Inlet. The fact that more and more discoveries are being announced is leading us to be more and more optimistic about our future and that’s something to be thankful for.

Anchorage is the right place for namesake naval ship

The USS Anchorage should be commissioned in Anchorage if the price is right. Sen. Lisa Murkowski has encouraged Secretary of the Navy Ray Mabus to have the San Antonio-class amphibious transport dock ship commissioned in Anchorage, for which it was named. The idea is appealing to Alaskans, particularly those living in Anchorage. Here’s a ship with an Alaska connection. Alaska has a long relationship with the armed forces. But the Navy hasn’t had a year-round presence in the state since the naval facilities in Adak closed, although we are happy to welcome those members of the Navy who frequent the Southeast Alaska Acoustic Measurement Facility here in Behm Canal. Alaskans are ardent supporters of the armed forces. Many of those who served in Alaska stayed and made it their home. Alaska is home to more veterans per capita than any other state. The 24,900-ton USS Anchorage has a crew of 360. It is 684 feet long, has a 105-foot beam and a 23-foot navigational draft. It cruises at more than 22 knots, powered by four turbo-charged diesels. It can accommodate a landing force of 700. The Anchorage is the seventh of 12 ships in the San Antonio class that the Navy started launching in 2000. They eventually will replace about 40 other Navy vessels. The ships are designed to improve efficiency. The Anchorage is the second Navy ship to bear the name of Alaska’s largest city. The first USS Anchorage was commissioned in 1969. It won numerous commendations in Vietnam, South West Asia, Operation Desert Storm and Operation Iraqi Freedom, to become the most decorated dock landing ship on the West Coast. The second USS Anchorage was christened in May at Huntington Ingalls Industries. It was built by Ingalls Shipbuilding. The commissioning ceremony will place the USS Anchorage on active duty. Currently, it is undergoing sea trials, which are expected to be completed for a 2012 commissioning ceremony. The cost of building each ship is around $1 billion. Despite the current U.S. financial status, the money is well spent to maintain the Navy fleet and improve upon its capabilities. But, given the finances, the Navy and its supporters — all of us — should consider the price of ceremonies occurring with each ship’s commissioning. This is a time when a small, less expensive, but still meaningful ceremony will do.

Alaska film subsidy needs a clear-eyed assessment

When the Legislature takes up the question of extending the Alaska film subsidy program, it should make the program more transparent and require more from the Outside film companies that are reaping most of the benefits. Statistics released by the state show $28.6 million of the $40.9 million allegedly spent in Alaska went in wages to people who do not live in Alaska. The real amount spent in Alaska is closer to $12.3 million, which is less than the $13 million paid out in credits. The Parnell administration’s assertion that 695 direct jobs have been created in Alaska and 516 jobs have been created Outside is an underwhelming justification for the subsidy, seeing how the wages paid to Alaskans are only one-ninth of the wages paid to people from Outside. The tax credits are given to limited liability companies formed to make movies that do not pay taxes in Alaska. They sell these credits through brokers who find buyers for them among the corporations that do pay taxes in Alaska. A new Anchorage group calling itself the Alaska Film Alliance is raising some reasonable questions about how this broker system works. Legislators need to ask how much the brokers are making for facilitating the exchange of tax credits. They also need to determine if the state would be better served by cutting out the middleman and transforming the subsidy into a grant system. In the end, a $1 tax credit means a reduction in general fund revenues of $1. However, a portion of that $1 subsidy is not going to a film company, but to the broker that sells the tax credits. The other issues raised by the film group are also ripe for discussion — such as more support for Alaska businesses by the state film office, changes that could lead to the hiring of more Alaskans on film projects and the establishment of more infrastructure. We won’t know if the Alaska experiment with subsidies is a success without more disclosure about where the money is going and more effort to promote the creation of jobs in Alaska.

Bypass mail bill could violate U.S. Constitution

Sen. Lisa Murkowski asked the right question: Can the federal government simply force the state of Alaska to pay for the U.S. Postal Service’s bypass mail system? The answer from the Congressional Research Service reflects what many suspected: The make-Alaska-pay provision is almost certainly unconstitutional. Yet the U.S. House Committee on Oversight and Government Reform approved the provision at its Oct. 13 meeting. “The State of Alaska, on an annual basis, shall make a payment to the Postal Service to reimburse the Postal Service for its costs in providing Alaska bypass mail service ...,” according to the committee’s proposed legislation, H.R. 2309. Really? The U.S. Congress can simply order Alaska’s state government to pay the bill? The bypass system allows businesses to ship 1,000-pound pallets of food and other items from Anchorage and Fairbanks to Alaska’s Bush communities at parcel post rates. The Postal Service dispatches the material to qualifying air carriers on a rotating basis, but the shipments “bypass” postal facilities for the most part. Air carriers are reimbursed at a variety of rates, depending on which leg of the journey they cover. The total paid to air carriers vastly exceeds the postage collected on the goods — by about $70 million. Murkowski asked the Congressional Research Service to review the House committee’s effort to make Alaska cover that difference. The nonpartisan agency came to a common-sense conclusion. “(The) mandate that the state of Alaska pay the cost to the Postal Service of providing Alaska bypass mail arguably may violate the 10th Amendment of the Constitution by ‘commandeering’ Alaska to enact a law appropriating its own funds to pay the amounts assessed,” the research service said in a Nov. 8 memo to Murkowski. The 10th Amendment clarifies that “the powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.” Section 8 of the U.S. Constitution states that Congress, not the states, “shall have Power ... to establish Post Offices and post Roads.” So it’s clear Congress doesn’t have the authority to require a state to operate even a portion of the postal system. The research service memo summarized relevant Supreme Court decisions. In one case, the court “observed that the Framers ... chose a Constitution that conferred upon Congress power to regulate individuals, but not states.” “The court acknowledged that the federal government may encourage states to regulate in a particular way or hold out incentives to influence their policy choices, but held that it may not coerce or compel states to take action,” the research service observed. The research service did offer one legal argument that might support the mandate. The Supreme Court has upheld federal “nondiscriminatory taxes or user fees to support federal programs that benefit a state.” For example, Massachusetts had to pay a federal registration fee for state-owned helicopters. However, it’s hard to argue that bypass mail primarily benefits “the state of Alaska,” as a government entity, the research service noted. The beneficiaries are mostly the users who ship materials. The state of Alaska doesn’t even have a formal role in the system — it’s all run by the Postal Service, the air carriers and the U.S. Department of Transportation. A Senate postal reform bill, which passed out of the Homeland Security and Governmental Affairs Committee last week, does not contain the make-Alaska-pay provision, thanks to the efforts of Murkowski and Sen. Mark Begich. Congress does have a choice here. If it believes the bypass mail system is too costly, it can pass legislation to curtail or even cancel the service. However, the members of Congress pushing this issue don’t want to be blamed for the economic trouble it would bring to rural Alaska, so they’re trying to both keep the program and make the state pay for it. That option shouldn’t be in their toolbox, though. Their only options are to keep, eliminate or cut back the bypass mail program. If Congress curtails it, then we Alaskans could decide whether to pick up the pieces somehow. But to simply order us to pay the Postal Service’s bills would be an abuse of federal power.

Government should extend funding on forest projects

The federal government should support roads and schools located in national forests. Sen. Lisa Murkowski has introduced legislation to reauthorize the Secure Rural Schools and Community Self-Determination Act. The act directs the U.S. Forest Service to share 25 percent of its revenues with local governments for the benefit of roads and schools. Southeast Alaska has received those funds for decades, and they are particularly important since the decline of the timber industry in the region. With less industry, fewer jobs and dollars are generated by business to support the economy. This act originated 60 years before the Payment in Lieu of Tax law designed to compensate counties for the loss of revenue caused by the inability to tax federal property. The Forest Service has paid billions of dollars to boroughs and counties throughout the country through the years. In 1990 the Forest Service sold $1.6 billion in timber. According to Murkowski, counties shared in more than $402 million that year. Plus, that year the Forest Service’s timber sales generated more than 102,000 direct and indirect jobs. They realized $5.3 billion in economic activity and $800 million in federal income taxes, Murkowski says, adding that the sales revenue supports other Forest Service programs, including recreation, wilderness, road building, maintenance and fire suppression. The act introduced by Murkowski would be extended for five years under the reauthorization. Over that period, the percent of Forest Service revenues paid would decrease 5 percent annually. During that period, it is hoped counties affected by the timber decline would be able to build new economies and require less financial assistance from the federal government. That would require the federal government to implement land policies that allow economic development. So far, the Tongass National Forest hasn’t seen any of the positive change President Barack Obama and his policies promised. The Tongass timber industry isn’t any better off now than it was three years ago when Obama took office. It isn’t likely to be. When it comes to the Tongass, it’s time for a change, beginning at the top, if necessary, with the president who sets policy for national forests.

Governments should not have a lying policy

It’s not acceptable for the government to lie. The end doesn’t justify the means is another way to look at it. The federal government wants to tell the public certain records don’t exist when they really do. For example, the government cites cases involving criminal investigations, protecting the identities of informants, foreign intelligence, counterintelligence and international terrorism. The issue has arisen because the Justice Department has proposed revised regulations that codify a policy detailed in a 1987 memo by former Attorney General Edwin Meese. In other words, the feds have been lying about certain records for at least a couple decades. The feds fear that suspects could file a Freedom of Information Act request to learn whether they are under criminal investigation or to gain sensitive information. The public has the opportunity to comment on the proposed regulation now. It is a difficult problem for the feds and the public alike. The public doesn’t want investigations or sensitive information compromised. But it doesn’t make lying the solution. The feds would be better to respond to requests for such information with “if any such records exist, they will be released at the appropriate time,” and then define “appropriate” as when the release of the information won’t compromise investigations, personal safety and national security. That might be too simple for a problem more complex than has been described. But the Justice Department should make more of an effort to retain its integrity and respond to the public honestly. After all, it doesn’t want the public lying to its investigators. It’s one thing to lie. It’s something else to say that our policy is to lie. That might be the sad fact, but let’s not codify it.

State PFD Division foul-up handled poorly

It was bad enough when the state issued full Permanent Fund dividends to roughly 5,500 people who should have had some or all of that amount withheld to pay one obligation or another. The PFD Division compounded that mistake not long afterwards by reaching into the bank accounts of those Alaskans and taking all $1,174 out with little or no warning. In fact, the state discovered the error Oct. 10, waited two days to notify banks and three to tell the general public. This snafu, followed by reclaiming the money on short notice, has led to overdrafted accounts, creating headaches for not only the people affected by the mistake, but banks and credit unions that have to sort out the mess in the fairest way possible. To their credit, most reports we’re receiving state the financial institutions are waiving overdraft fees and bending over backwards to help customers whose balances have gone from positive to negative overnight. To be fair, some of the 5,500 affected folks knew or should have known the money that showed up in their accounts wasn’t all theirs. Things such as IRS levies, bankruptcy and child support aren’t imposed in secret, and a fair number of the people literally seeing red on their bank balances were well aware they’d been given money by mistake. However, many others did their due diligence by checking and rechecking the PFD division’s website to see if their checks would be a little light, perhaps from a long-forgotten traffic ticket. Requests for garnishments were due by Aug. 31, and people double-checking their memories or records should have been reasonably able to expect to receive their full PFDs if no holds had been placed by the deadline. This doesn’t mean those debts aren’t owed, but it does give the debtor a role in managing the process so one bill isn’t satisfied at the expense of all others. At a minimum, the PFD Division should have notified the people affected by its mistake first, and worked out a way to recover the improper payments. Yes, offering a payment plan might have been a burden on the division, but let’s not forget this became an issue because of its mistake. Instead, there are now people scrambling to figure out how to pay for a winter’s worth of heating oil on an expected income that suddenly shrank nearly $1,200. The picture of an over-reaching government has been a popular one to paint as of late — sometimes with justification and sometimes not. Actions like those taken last week by the PDF Division only serve to showcase one of the biggest strokes of that portrait — a government entity acting within the law but outside the bounds of common sense. Mistakes are bound to happen, regardless of whether an organization is one of the people or a private entity. Let’s hope the PFD Division learns from this one, so future errors aren’t compounded by a lack of thinking before acting.

Governor needs to address van Meurs' oil tax criticisms

Gov. Sean Parnell and supporters of his plan to revise the state’s oil tax system to spur production have a problem they need to aggressively combat. The problem’s name is Pedro van Meurs. The problem isn’t the man, of course; rather, it’s a report his company produced regarding oil and gas tax systems around the world. The report isn’t kind to Alaska’s present oil tax system. Nor is it kind to Gov. Parnell’s proposed changes. The report, to which the Daily News-Miner was given limited access by Mr. van Meurs’ company, bluntly states that Alaska’s current oil tax system isn’t working. The report says the system put in place under then-Gov. Sarah Palin, known as Alaska’s Clear and Equitable Share, needs to be replaced. ACES, approved in 2007, doesn’t do enough to encourage production of heavy oil, the remaining large — yet difficult to produce — source of oil on the North Slope, the report says. The law is inadequate in dealing with natural gas. It also notes in its many pages that Alaska under ACES has toughened its fiscal regime in the past 15 years. But it also notes the state has done so at a time when other governments, such as in Canada and Greenland, have loosened their fiscal systems to entice activity by the oil industry. Alaska has become a less-favorable place to do business, it seems. Those are precisely the problems that Gov. Parnell is trying to fix with his proposals, contained in House Bill 110. The House passed the bill earlier this year, but it stalled in the Senate amid strong opposition from key senators. The Legislature reconvenes in January, and the governor wants to see his bill approved. The van Meurs report is no friend of the governor’s bill, however. It is as blunt in rejecting the Gov. Parnell’s plan as it is in saying the current system is broken. The report finds several areas of fault with the governor’s plan and says he cannot meet his goal of getting more oil in the trans-Alaska oil pipeline without doing something to get the heavy oil out of the ground. It says neither his proposal nor another bill, House Bill 17, will work in their present forms. Mr. van Meurs, with a lengthy history in the oil industry, is no stranger to Alaska. He was a prominent figure in the oil tax debate that occurred during the term of Gov. Frank Murkowski. The report by Mr. van Meurs’ company raises questions that even supporters of Gov. Parnell’s efforts should want answered. This is a high-stakes time for Alaska in an increasingly competitive global oil market. Gov. Parnell’s course may indeed by the correct one for the state. If so, his proposal should be able to withstand the scrutiny that the van Meurs report invites. The governor and his team must confront the van Meurs report head on if they want to sustain and build support for their approach.

EDITORIAL: Obama's NCLB rule opens doors to the next steps in education

In 2001, President George W. Bush’s signature reform effort, the No Child Left Behind Act, became law with broad bipartisan support, its centerpiece a bold pledge to hold all students to high standards. The law, which President Barack Obama said he will dramatically alter in the coming months, requires annual student testing and sets a goal of bringing all American children, regardless of background or disability, to grade level in reading and math by 2014. An audacious and admirable goal, to be sure, one that focused attention on every student like never before. Under the law, schools are judged a success only if every group of students in the school, including poor students, racial groups and special-education students, meet testing targets that grow more difficult each year. That microscopic view has done wonders to focus America on its neediest students. But that laudable goal also has proved counterproductive and unworkable, leaving Obama and U.S. Education Secretary Arne Duncan little choice but to rework it. Obama said he will offer waivers to states that want to opt out of key provisions of the No Child Act, including the mandate that all students reach proficiency by 2014. The waivers are in place of a scheduled 2007 update to the law that Congress has failed to produce. The waivers are reserved for states that will use rigorous “college and career standards” to set new “ambitious but achievable” testing goals, states willing to turn around their weakest schools and states willing to set guidelines for teacher and principal evaluations. This is not a retreat. We consider this No Child Left Behind, Part 2. The No Child law set the nation on the right course. But now we’re ready for the next step: A law that does more than identify the problem, a law that does a better job of moving education in America forward.

EDITORIAL: Open ANWR: Refuge part of deficit solution

Raising revenue without raising taxes. That’s an excellent idea if ever there was one. All we have to do as a nation is go to a piggy bank, one of which is sitting way up north in Alaska. A relatively small portion of the Arctic National Wildlife Refuge could provide the nation not only with another source of domestic oil but also billions of dollars in revenue from that oil. The idea to open the coastal plain of ANWR to oil development is far from new. Congress in 1980 designated the coastal plain as an area available to oil production, with another vote of Congress required for that to actually occur. People have been fighting about ANWR ever since. The idea to have ANWR provide some of the necessary revenue for deficit reduction came up this week from Rep. Doc Hastings, R-Wash., a member of the bipartisan supercommittee that has been given the task of creating a plan to reduce the nation’s deficit. Rep. Hastings pointed out the numbers. “According to USGS estimates, ANWR contains approximately 10.4 billion barrels of oil and at peak production could supply the U.S. with up to 1.45 million barrels of oil per day. This is more than the U.S. imports daily from Saudi Arabia. “Producing this much oil would generate substantial revenue for the federal government through leasing and royalties. Over the life of production, ANWR could generate approximately $150 billion.... This is a conservative estimate and could very well be as much as $296 billion depending on the price of oil and the actual amount of oil resources.” Finding new revenue without raising taxes is something that should appeal to all members of the congressional supercommittee. Unfortunately, it doesn’t. Some members of the panel — and of Congress as a whole — are holding on to opposition positions that date back to another era. Opponents of opening ANWR need to bring their opinions in line with the reality of the day. Is ANWR the total solution? No, it never has been. Not for the nation’s financial problems and not for its energy problems. But is it a viable and available source of both money and oil? Absolutely. To let this small spot of ANWR remain locked up, especially now, makes little sense.

EDITORIAL: Ketchikan urges locally made ferries, state should follow suit

@font-face { font-family: "Cambria"; }@font-face { font-family: "Helvetica-Condensed-Bold"; }@font-face { font-family: "Bodoni-Book"; }p.MsoNormal, li.MsoNormal, div.MsoNormal { margin: 0in 0in 0.0001pt; font-size: 12pt; font-family: "Times New Roman"; }p.Byline3, li.Byline3, div.Byline3 { margin: 0in 0in 0.0001pt; line-height: 14pt; border: medium none; padding: 0in; font-size: 10pt; font-family: Helvetica-Condensed-Bold; color: black; font-weight: bold; }p.Bodytext, li.Bodytext, div.Bodytext { margin: 0in 0in 0.0001pt; text-align: justify; text-indent: 12pt; line-height: 12pt; font-size: 10.5pt; font-family: Bodoni-Book; color: black; letter-spacing: -0.15pt; }div.Section1 { page: Section1; } No economic decision is as important to Ketchikan at the moment as the awarding of the Alaska Class Ferry contract to the local shipyard. That’s why both the Ketchikan City Council and Ketchikan Gateway Borough are passing resolutions urging that all state-owned marine vessels be built in Alaska shipyards — not just the ferries, but any Alaska-owned vessel. The state Legislature should follow suit. The resolutions point out that the city — along with the Ketchikan shipyard’s operator, Alaska Ship and Drydock, and its owner, Alaska Industrial Development and Export Authority — has been actively working to make the shipyard industry viable in Ketchikan. The shipyard isn’t only valuable to the state, but to Ketchikan as it develops and expands its maritime industry. Ketchikan Shipyard is successful in building and maintaining marine vessels, and has earned its reputation for quality work completed on budget and deadline. It also provides year-round, well-paying manufacturing jobs in Ketchikan. Manufacturing jobs are the key to any successful economy. The shipyard has a great future as industries, such as fisheries and oil, expand in Alaska. The Alaska Community Development Quota shareholders are purchasing vessels in the Bering Sea groundfishing fleet, according to the resolutions, and they desire to locate their fleet in Alaska ports. The American Fisheries Act will allow Bering Sea vessels to be rebuilt and replaced over the next 30 years; this represents up to $10 billion of new shipbuilding, which could be done in Alaska shipyards, particularly Ketchikan’s. The oil and gas industry is expected to need new ships for its exploration, development and production on Alaska’s Arctic Outer Continental Shelf. Over 50 years, that’s 54,700 jobs, and an untold amount in shipbuilding that could be completed in Alaska to enhance the state economy, particularly Ketchikan’s. The oil and fishing fleet work isn’t anticipated for another 10 years. In the meantime, the shipyard needs work. The next obvious project(s) for the Ketchikan Shipyard or another Alaska shipyard is the Alaska Class Ferry. For Ketchikan, it could mean a reversal of declining or stagnant population, school enrollment and employment numbers. The Alaska Class Ferry contract would produce 200 jobs for the next three to four years, with a $35 million payroll. The shipyard would spend another nearly $27 million on purchases, many of them locally or within Alaska. This doesn’t mean that Alaska shouldn’t get a fair deal with any Alaska-based shipyard. It should, and it would. Alaska shipyards recognize the danger to their operations, their communities and the state, by doing anything else. The Council and Assembly clearly have a vision for the shipyard, Ketchikan and Alaska in mind. But it’s state government that will make the final decision on the ferries. It’s the people’s government, and the people’s voice ultimately needs to be heard. Tell state officials Alaskans prefer keeping jobs at home instead of shipping them out. The City Council and Borough Assembly said it well. The people can make it louder.    

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