Builders, oil firms expand worker recruitment

The crunch in filling skilled blue collar jobs in Alaska is becoming more serious.Dick Cattanach, executive director of Associated General Contractors, the construction industry’s trade association, says his industry will have to recruit about 1,000 young Alaskans a year into training to meet the expected needs of contractors over the next four years.This assumes the industry’s current load of projects and some expected modest growth, but not a large project like a gas pipeline or a missile defense program, Cattanach said.That’s about one in six Alaska high school graduates.The problem isn’t just in construction. It’s across the work force. Oil and gas companies, who have an aging work force of process facility operators on the North Slope, are seriously concerned.AGC, unions in the building trades and the major industries that operate plants and other process facilities are now doing something about the work force problem.The Alaska Process Industries Careers Consortium, formed two years ago to facilitate training for process operators, is now expanding its scope to other technical occupations in short supply and will also promote training in the construction industry.Alaska Works, a nonprofit organization formed by Alaska building trade unions, has geared up rural construction training programs that are now operating in the Bering Straits, Bristol Bay and Yukon-Kuskokwim regions. The effort is being supported by federal funds.The emphasis is on recruiting, screening and helping organize training for rural housing projects."The idea is for people in these communities to develop the skills to build projects in their own communities, and then become part of the statewide trained work force," said Mike Andrews, director of Alaska Works.Meanwhile, AGC is gearing up its outreach effort in schools, aided by materials developed by the national AGC organization."Build It," a kit of projects for fourth and fifth grades, was offered in 100 elementary schools around the state this past year, according to Cattanach.This is being followed by "On Site," a program for middle schools, which two rural school districts started using this spring. It will be in more middle schools next fall, Cattanach said.High schools in Anchorage, the Matanuska-Susitna Borough and in 10 rural schools have also adopted a core curriculum of more advanced skills developed by the National Center for Construction Education, a program of the University of Florida at Gainesville.The core curriculum is intended to lead into more advanced hands-on vocational education in carpentry, electrical, mechanical and plumbing. There are limits to the ability of some Alaska high schools to offer this, but there’s a lot of interest in the core curriculum, Cattanach said.The unions’ Alaska Works group is cooperating with AGC and also has its own effort under way in schools to interest and recruit young people in construction, Andrews said.The group is working with local school districts in Fairbanks, Bethel and the Matanuska-Susitna Borough on a "tech prep" program for young people with an interest in construction.Building trades unions in Fairbanks began tech-prep there in 1998, Andrews said. It was offered in Bethel schools the following year, and most recently in Mat-Su schools.The program helps channel young people into the University of Alaska’s two-year associate degree program in apprenticeship technology, Andrews said.Meanwhile, the Alaska Process Industry Careers Consortium will see the first fruits of its two years of work this winter when 35 Alaskans graduate from a two-year program conducted on three University of Alaska campuses.The consortium, made up of companies that operate process facilities in petroleum, mining, electric utilities and other industries, worked closely with the university to develop the program and helped fund it, mostly through curriculum development and scholarships.With process operators in high demand, this winter’s graduates are highly likely to be hired into good-paying jobs with companies that operate process facilities, according to Ann Spohnholz, APICC’s executive director. She said some are already working as summer interns for oil and gas companies on the North Slope.Having built this track record, APICC is now expanding its scope, Spohnholz said, to include training for electrical and instrumentation technicians, heavy equipment maintenance technicians, health, safety and environment workers and other occupations that will be in high demand in several Alaska industries, including construction.APICC is close to signing a formal agreement with the Associated General Contractors and Alaska Works to help promote construction careers training in the extensive outreach efforts APICC has under way."Training for the building trades isn’t our prime mission, but there is significant overlap between the industries," Spohnholz said. "The core jobs we are focusing on are the operators, technicians, machinists, health and safety professionals and the engineers. In order for the industry to operate there must be maintenance of new facilities," she said. Part of APICC’s mission is to do outreach to the kindergarten through high school education community, to promote technical training and put an emphasis on math and science, Spohnholz said.APICC’s Career Connections Committee in an informal network that meets by teleconference monthly, consisting of industry people and educators. "We’ve taken a leadership role, along with the Business Education Compact, in assisting industry to partner with local school districts to make curriculum relevant for kids, and to help them know about real jobs," Spohnholz said.Some of APICC’s members are promoting programs in schools, such as AMEREF, or Alaska Mineral and Energy Education Fund, which developed school kits stimulating interest in natural resource sciences.There’s also Science in a Technical World, a series of science projects for seventh and eighth grades that stimulates interest in science, math and science-related reading and writing; and Choices, for elementary schools."All the research shows that young people tend to form opinions about jobs and occupations at about the fifth and sixth grades," Spohnholz said. "This is a critical age."We’ve got a serious problem because the bias not only in the education community but among parents and society in general is toward academics and the college track. Along the way many young people are being turned away from an interest in fields where they could make a good living," she said.

Halibut bycatch forces early closure to yellowfin sole fishery

Thanks to an abundance of big halibut coming up in the trawl nets, the spring yellowfin sole fishery closed early in the Bering Sea. Most of the halibut bycatch is tossed back dead because of a federally mandated waste policy.The factory trawlers targeting yellowfin sole in the Bering Sea were ordered to stop fishing April 26, when they’d reached their seasonal halibut bycatch allowance.In recent years, the fishing boats stayed within halibut bycatch limits and kept on harvesting the small yellowfin that weigh around a pound per fish.But this year, there was no escaping the halibut.John Gauvin of Seattle represents a group of 15 factory trawlers in the Groundfish Forum. He said boats spent much time hunting for cleaner fishing areas. Finally, they started seeing fewer halibut, but then the fishery was shut down."I think people were doing what they could to avoid halibut, but the stars were not aligned for keeping the halibut rates down this spring," Gauvin said. Mike Szymanski of Anchorage represents the Fishing Company of Alaska’s five flatfish boats. He says the halibut were extra big this year."Sometimes they’re so large it takes two people to move them. They’re probably anywhere from 40 to 80 pounds, sometimes as high as 100 to 150 pounds, 200 pounds would be some of the bigger ones they’re huge out there and there’s just lots of them," Szymanski said.Factory trawler skippers confirmed the reports of prolific halibut."They were bigger than usual. Really beautiful fish, probably 20 kilograms and more. We don’t normally see them up that shallow this time of year. It’s usually a pretty clean fishery," said Dave Strand, skipper of the Arica, reporting abundant halibut at 26 to 35 fathoms."Couldn’t get away from them. They were really widespread and looked real healthy. For sure the halibut’s a good stock. There’s a lot of them," Strand said.Butch Taylor, skipper of the Rebecca Irene, reported a difficult season."It’s like everything’s against us. The prices aren’t really good. The fishing’s not piled up. The water’s been unusually warm. The halibut numbers are really high. It was just a tough go this year," Taylor said.Taylor said a virtual absence of higher-value flathead sole left only the lower-value yellowfin as an alternative. Sometimes flathead appeared in test tows, but so did high concentrations of halibut."There was no flathead to start with, and what little you could find, there was so much halibut you couldn’t fish it," Taylor said.Many of the boats won’t start fishing again until July 1, when the National Marine Fisheries Service issues 380 metric tons of "halibut mortality" to the yellowfin fleet.The National Marine Fisheries Service has granted the yellowfin fishery a mortality allowance of 911 metric tons of dead halibut for 2001. That’s the quantity of fish wasted by government mandate because of pressure from halibut fishermen who fish with hooks and line."The problem you run into is the halibut fishery is an allocated fishery. It was turned into an IFQ (individual fisheries quota) program some years ago. As a result, those designated fishermen that have that quota certainly don’t want to see competition in the market from fish that are being brought up in other fisheries," Szymanski said.Szymanski says his company would like to donate its halibut bycatch to food banks, but is prohibited by federal law. Only halibut bycatch from boats delivering to shore plants can legally be donated to food banks."It’s very difficult out there. You have normal mortality, and you have regulatory mortality that is created by the regulations," Szymanski said. "The regulations that are in place create a lot of the waste. But that’s a known given factor. It’s just part of the politics of the fishery."Federal fisheries managers figure that 81 percent of the halibut bycatch in the yellowfin sole fishery dies before being returned to the water. The International Pacific Halibut Commission’s Gregg Williams in Seattle says that figure could be substantially reduced if fishing boats were awarded bycatch allowances on an individual basis, instead of an overall cap for the whole fleet.With individual bycatch limits, trawlers would likely make shorter tows. When trawlers haul their nets for shorter periods, less fish accumulates in the net to kill the halibut, he said. An individual bycatch quota system has greatly reduced halibut mortality in Canada, he said.Jim Paulin is a free-lance writer living in Dutch Harbor. He can be reached via e-mail at ([email protected])

State has boom coming Stevens says

Even without development of the Arctic National Wildlife Refuge, "We do have a boom coming," said Alaska Republican Sen. Ted Stevens at a May 30 press conference in Anchorage. Stevens, citing recent oil and gas discoveries in the National Petroleum Reserve-Alaska and the likelihood of a gas pipeline to the Lower 48, said gas will play a bigger role than oil in Alaska’s energy future.  That’s because in an era concerned with pollution and global warming, Stevens predicts clean-burning natural gas will become more valuable than oil. "We’re going into a new era -- a new crescendo for the state of Alaska," he said. Stevens called the press conference just days before control of the Senate was due to switch from Republicans to Democrats after the defection of Sen. James Jeffords of Vermont from the Republican Party. Stevens was peppered with questions about how the change will affect issues of interest -- and the flow of dollars -- to Alaska. Stevens said not to worry. "It’s not a disaster," he said. "It’s a wake-up call. We’ll be better off for it. We’ll be more cohesive." Stevens will be stepping down as chairman of the Senate Appropriations Committee and handing the gavel to Sen. Robert Byrd, D-Va. But Stevens predicted only a minor impact on his funding goals for Alaska, thanks to a long friendship with Byrd. "We have a very good working relationship," he said. Stevens said one area of uncertainty over funding will involve military construction projects in Alaska. He said that’s because Defense Secretary Donald Rumsfeld has ordered a complete review of military spending, with the results not expected to be known until fall. Stevens remained confident that ANWR will eventually be opened to oil and gas exploration, despite predictions by Senate Democrats that the issue is dead now that they’re in the majority. Stevens said he has 48 votes in favor of ANWR and expects to eventually get more. "When gasoline is $3 a gallon -- and that’s the prediction for the summer of 2002, prior to an election -- we’ll react to that," he said. "The bell is going to toll when it’s time for ANWR, just like it did for the pipeline." Stevens said California’s current electricity shortage will also figure into the ANWR equation, since the shortage is affecting neighboring states and may spread to the East Coast. "It’s a virus," Stevens said. "It’s the AIDS of energy. It’s going to spread east, where it will be more dangerous." Stevens said he fully expects a natural gas pipeline to be built soon from Alaska to the Lower 48. "I think it’s coming," he said. "It could be under construction in 2004, or maybe a year later." He said he didn’t know yet if any enabling legislation would be required for the pipeline to proceed. The trans-Alaska oil pipeline did require such legislation, which is coming up for reauthorization in 2004. Stevens said he will push for more inspections of the aging pipeline as part of the bill. He’s also concerned about permafrost under the pipeline melting as global climate change warms the Arctic. Stevens warned that any congressman expecting a "quid pro quo" for voting to reauthorize the pipeline would get nothing from him. "I don’t think this country will stand still for shutting down the pipeline," he said. "They don’t have any leverage on us. I’ll laugh at them if they try." Stevens was also asked about the National Missile Defense, another issue whose fate may change due to the Democratic takeover of the Senate. Stevens pointed out that the initial phase of the program has been authorized by Congress and was signed by then-President Clinton. "It’s just a matter of implementation," Stevens said. Stevens said he’s unhappy with lukewarm support for the NMD from America’s European allies in NATO. Opponents to the system also cite the 1972 Anti-Ballistic Missile treaty, which has been interpreted as banning construction of a missile defense. Stevens said the ABM treaty was signed with the USSR, which at the time was a major enemy of the United States -- not with Russia, which isn’t. "The ABM treaty is a relic of the past," Stevens said. "We’re not going to leave ourselves open to the threat of missiles (from rogue states)."  

Business Profile: The Chariot Group Inc.

Name of the company: The Chariot Group Inc.Established: 1999Location: 2600 Denali St., Suite 102, AnchorageTelephone: 907-222-5300Web site: www.chariotgroup.comMajor focus of services: The Chariot Group Inc. sells, services and installs presentation equipment including video conferencing equipment, mulitmedia projectors and the latest high-tech plasma projector screens.History of the company: Rick and Denise Thomas founded the company in September 1999 after moving to Alaska from Las Vegas where Rick had worked for a similar company.Last October The Chariot Group relocated to a new office in Anchorage.The company now employs three people, and the Thomases call on contract workers for various projects.Today The Chariot Group sells multimedia presentation products directly from manufacturers -- including major players Toshiba, 3M and Mitsubishi -- to outfit classrooms or boardrooms. The Chariot Group has outfitted clients from consultants with lightweight presentation screens to large companies in Alaska requiring a fully equipped boardroom.In March The Chariot Group began offering its own boardroom equipped with multimedia equipment for rent. The couple decided to provide the service after clients queried them about renting equipment. The rental suite is available by the hour with a one-hour minimum.One industry trend they note is a move from mobile presentation equipment to integrated multimedia rooms for presentations.Top accomplishment of the company: Rick and Denise Thomas are proud of the strong relationships they’ve developed with clients. "That’s a reflection of what the main goal is, which is to provide a positive experience for customers and maintain that relationship," Denise Thomas said.Major players: Denise Thomas, office manager, and Rick Thomas, president, The Chariot Group Inc.Denise Thomas earned an accounting degree from the University of Nevada at Las Vegas and later received her license as a certified public accountant. Rick Thomas earned a finance degree from UNLV and operated an insurance business for about seven years. He next joined a video conference and multimedia company in Las Vegas. He has logged six years in the industry.-- Nancy Pounds

Lowe's ready to restart construction on South Anchorage store

Company officials from Lowe’s Home Improvement are finalizing plans to restart construction work on a new store in Anchorage. Lowe’s representatives still hope to resume construction later this year.The Wilkesboro, N.C.-based chain halted the project earlier this spring. "We did not have a finalized site plan," said company spokeswoman Suzanne McCoy.Site work has been completed, she said. The store, which would be the company’s second in Anchorage, is in South Anchorage.Once company officials finalizes the plan they will release the project for bid, McCoy said.Construction could begin after these processes are completed, she said."We hope to begin construction this year but it has not been finalized. We anticipate and hope," she said.Lowe’s completed its acquisition Jan. 9 of 21.5 acres at the southwest corner of the Old Seward Highway and O’Malley Road.The store was expected to open in January 2002 under the previous construction timetable.A new Lowe’s store should total about 150,000 square feet, including 28,000 to 30,000 square feet for a lawn and garden center, McCoy said.Stores of this size typically employ 175 to 200 people with 85 percent of those employees working full time, she said.This store will be the first Alaska Lowe’s designed after company models, she noted. Lowe’s acquired Eagle Hardware and Garden, including its Midtown Anchorage store, in April 1999.Competitor Home Depot, based in Atlanta, also planned to build its second Anchorage store this year in East Anchorage, although that project has been put on hold. Construction was to begin this year with the store opening in late 2001.Home Depot officials did not return calls by press time to offer an update on the proposed new store.The new Anchorage store was to weigh in at 133,000 square feet and include a 15,000-square-foot garden center.

NC Machinery outfits Russians

Without a lot of fanfare, Alaska equipment dealers have carved out market niches in the last decade selling equipment, parts and services in the Russian Far East.Despite Russia’s economic turmoil and political uncertainties, it’s a profitable business, say Alaskans who are involved.Mining companies working in Magadan are a solid piece of business for NC Machinery Co., the distributor for Caterpillar machinery in Washington and Alaska."Mining accounts for 85 percent of our business in Russia," said Gene Sanderson, Alaska product support manager.NC began its Russian business in the Alaska business unit, but responsibility for sales has mainly been transferred to Seattle. However, parts and service are still coordinated through Alaska and parts shipped by air are routed through Alaska, Sanderson said.It’s a twist of history for the company, because NC Machinery had its roots in Russia through its one-time former parent, Northern Commercial Co., a general merchandise company. In recent years, other parts of NC were sold, such as the Anchorage clothing store that is now Nordstroms and several rural retail stores purchased by Alaska Commercial Co. NC has been Caterpillar’s distributor in Alaska since 1926.Northern Commercial descended from the old Russian America, formed in Czarist times to manage commercial development of Russia’s Alaska colony. It was sold to Americans after the United States bought Alaska in 1867.Parts and service with the Russian Far East amount to several million dollars a year in business for NC. Equipment sales vary, and in some years can exceed $10 million per year. Sanderson said the company’s involvement with Russia began in the late 1980s when Caterpillar, which previously coordinated all sales and services in the Soviet Union itself, could see big changes coming.Mining companies in the Russian Far East, which produce 70 percent of Russia’s gold, were important, and Caterpillar thought they could be better served from the U.S. Northwest, and the NC Machinery office in Anchorage was the closest.Karen Haden, the company’s general parts manager for Alaska, recalled an initial order for 25 D-10 bulldozers, which eventually became an order for 95 machines. D-10s now sell for up to $750,000 per unit. Even then it was a huge order for NC Machinery and Caterpillar.There were already over 100 D-9 size machines in the Magadan territory, which needed parts support.With this much business generated, NC Machinery established a warehouse in Magadan and stocked it with $2 million in parts. Today it is operated by NC International, a Russian company owned by the parent company of NC Machinery. NC Machinery has 14 employees in Magadan.Most parts are shipped by barge from Seattle but about 10 percent are flown through Alaska, on Mavial Airlines’ direct flights from Anchorage to Magadan, Haden said. Because of aircraft loading limitations, there are 400-pound limits to shipments on Mavial.Caterpillar tractors are shipped by barge from Seattle but the time taken in transit, mostly the part in Russia, is very long. It can take almost a year for a unit to arrive at a remote mine site.Ocean barge shipment takes just a few days, but then there’s a slow movement along railroads and roads in the Russian Far East, usually involving a journey inland by river barge, and then, after freezeup, a slow road trip out to a mine. Shipping a D-9 usually adds $20,000 to the cost of the unit, Sanderson said.Sometimes customers need equipment faster. Haden recalled two D-9s shipped by air. They were broken down and carried in Russian IL-76 air freighters, specialized planes capable of carrying outsized cargoes.NC sells to Russian and other foreign companies, and one big customer is the operator of the Kubaka gold mine, which is owned by Kinross Gold, a Canadian company with Russian partners. Kinross also owns the Fort Knox gold mine near Fairbanks.The company also sells to mining companies on the Kamchatka Peninsula and is hoping to see development of a very large gold mine in the southern part of the peninsula, according to Sasha Clark, a former resident of Khabarovsk who has been working with NC for several years. Southern Kamchatka is in an area of environmental sensitivity, however.Doing business in Russia is not without its frustrations. Chief among these are uncertainties in government regulations and customs, Sanderson said.Getting paid can also be a challenge sometimes, he said. NC now accepts payment in both rubles and dollars, and also helps in equipment financing for its major customers. The distributor is able to share financing risks with an international sales division of Caterpillar."It’s very important to know who your customers are, their situation and their debts," said Clark.

The 0.08 DWI limit won't curb alcoholism or accidents

Whether you know it or not, the Alaska Legislature passed a new blood-alcohol content law that takes effect Sept. 1, 2001. The amendment, added to a rural bootlegging and fingerprint bill, was inserted by the House Rules Committee. The actual decision was made in the speaker’s chambers in the Capitol. And while a majority of the public was unaware of the insertion, on May 8 the House passed the legislation, which included a reduction in BAC for driving while intoxicated violation. Aside from the legislative process appearing deceptive, because the 0.08 concept, with three separate legislators sponsoring the bill, could not pass on its own merit, it is also important to note that the context of lowering the BAC was a mandate from none other than former President Clinton. Specifically, the federal government tied highway funding to the passage. No BAC reduction equated to denial of highway funds. However, Alaska has until 2007 to change the law. And the funds the state stands to lose will total $850,000 annually, yet how much will administration of the new law cost the public? During the hearings for the various 0.08 BAC bills, the Department of Public Safety fiscal notes varied because the assumption shifted from a speculated 10 percent increase in DWI arrests to a 5 percent increase in arrests. The lower arrest percentage was recommended by the Department of Public Safety. A fiscal note accompanies a bill and is the cost for a particular state department to implement and administer the legislation. In the case of the 0.08 BAC shift, the public defender will need to hire another attorney, the courts will have an increased docket, the Health Department will receive new clients, the Division of Motor Vehicles will require additional staff -- and the list goes on. So where is the savings? Most legislators go with the flow. But passage of the 0.08 BAC reflects emotions instead of facts. For instance, of paramount concern is the reality that people who are arrested for a DWI violation at the 0.08 BAC level are proven most likely not to reoffend. They are not problem drinkers and generally learn their lesson. They do not require a steep fine or extended jail time to understand their mistake. The multiple offenders are the individuals to be targeted, and it is this group that most often yields a 1.5 BAC and higher. It is the problem drunken driver who is in need of extensive treatment. Without such treatment, they will reoffend and harm more people regardless of the new law. When I attended a meeting of the mayor’s DWI task force last summer, it was our former chief of police who spoke up and informed the members that lowering the BAC would result in more arrests. He reminded the task force that arrests equate to expenditures which equate to the need for additional tax revenue. To that end, this law will not resolve alcohol-related problems. If anything, it is yet another knee-jerk reaction to provide a false feeling of comfort to advocacy groups and loved ones to those who tragically lost their lives in a DWI-related accident. Again -- it is about trying to solve a very complex problem with the wrong solution. The answer is not to impose additional laws. The real answer lies with society understanding alcoholism, a disease accurately identified by modern medicine and our government. Yet society refuses to deal with it as such. Instead, as seen by the current BAC change, it is easier to treat alcoholism as a premeditated crime. The bottom line: The hospitality industry applauds open and honest discussion on alcohol-related topics and legislation. We support the Wellness Court concept because it offers treatment. We do not condone driving under the influence, nor operate our businesses with that intent in mind. However, our industry is not supportive of fast-tracking amendments as add-ons to legislation without thorough and substantive input. Regardless of the numerous hearings for the 0.08 BAC bills, the actual passage of the law came through separate legislation. And sadly, the problem of alcoholism, DWIs and alcohol-related accidents will not be curbed by this law, but the public will certainly bear the cost of its implementation. Frank Dahl is president of the Anchorage Cabaret, Hotel and Retailers Association.  

Overseas sales

Pacific Detroit Diesel-Allison has been selling electric generators and other equipment to the Russian Far East since the early 1990s. The Anchorage branch of the Portland, Ore.-based company is the Alaska distributorship for Detroit Diesel, Kohler Power Systems, Allison transmissions and other equipment lines.Although sales and service for Russia is now split between Alaska and Washington offices, the business began in Alaska when Dave Heatwole, an Alaskan working as a trade consultant in the region, put Russian mining companies in touch with the company."It was a nice sale, and it sparked the attention of our management," to the region’s potential, according to Patrick Doran, the company’s Alaska parts manager who also helps coordinate parts and service to Russia.The company operates nine branches in Washington, Oregon, Alaska and Hawaii. In Alaska the company has branches in Anchorage and Fairbanks. Russia is Pacific Detroit Diesel-Allison’s only export market.Sales representatives for the company maintain offices in Yuzhno, Sakhalin’s major city, Khabarovsk, Magadan and Petropovlovsk."Our core business is in the U.S. Russia is a small part of it, but it’s profitable," Doran said.The equipment being sold actually has a long track record in the former Soviet Union. Detroit Diesel engines powered some Soviet tanks during World War II -- the engine manufacturer was then part of General Motors -- and Doran recalls meeting Russian veterans who were familiar with the engines.Doran joined the company shortly after it started selling to Russia. He had a construction background, had earned a business degree from the University of Alaska Anchorage and learned to speak Russian.He was working in the World Trade Center office in Khabarovsk in 1995 when he was hired by the company to set up a network of sales and service representatives in the region.One of the representatives, Dimitri Kraskovsky, now works in the company’s offices in Kent, Wash., and works with Doran to coordinate sales and service to Russia. Instead of dividing the area by region, Kraskovsky handles Russian customers while Doran takes care of foreign companies working in the Russian Far East.Most units are shipped by sea from the Port of Tacoma, but occasional air shipments and delivery of parts are coordinated by Doran through Alaska. The company ships by Korean and Asiana airlines to Seoul, from there the carriers ship to major cities in Russia."We still sell generation units, the most popular being 100 killowatts to 200 kw units, but most of our business these days is parts to units that are now there," Doran said.While mining companies in Russia are important customers, the company’s clientele is any business or institution needing standby generating capability, which is a pretty big base in a country where electric utilities are notoriously unreliable.Customers include banks, port facilities, hotels and even trucking companies that use Detroit Diesel engines."We’ve looked at sales potential in other parts of Russia but the logistics of getting equipment there and then servicing the customers would be formidable. Also, when we go west we’re in the region where European competitors operate," Doran said.There’s vigorous competition in the Russian Far East, too, from Japanese and Korean companies and other U.S. companies who sell generators. Domestic Russian companies are competitors, too."Russians have superb technical capabilities and in Soviet times were very advanced in electronics, aircraft, space and a whole range of sophisticated industries," Doran said.The breakup of the Soviet Union and Russia’s economic troubles have taken a heavy toll on the country’s industry."The country is littered with rundown plants," he said, adding that as the country rebuilds they will become more serious competitors.pComputer technology is one area where Doran finds Russians very advanced."Anyone who does business with the West, and almost everyone I know there, is very up to speed on both hardware and software," he said.Unlike many U.S. firms doing business in Russia, Pacific Detroit-Diesel hasn’t had problems getting paid, but that’s because of strict adherence to prepayment terms."We’ve never missed a nickel, but we’re not flexible when it comes to payment. We want the money up front," Doran said. On larger sales of $50,000 to $100,000, the company will accept 50 percent prepayment with the order and the rest when the equipment is ready to ship from Seattle."We’ve never shipped anything that hasn’t been completely paid for," Doran said.There have been cases where parts have been ordered and then the customer has struggled to make payment, but it doesn’t happen very often, he said."We make our payment terms very clear, ahead of time. This means we rely on our representatives a lot to do due diligence on customers," Doran said. "It helps when we explain that our terms for domestic sales are similar.""Our terms require faith on the part of the customers in Russia, because they are paying for something for which delivery hasn’t been made," Doran said.

Tank farm may return to Seward

SEWARD -- The Yukon Fuel Co. wants to make Seward home to a bulk fuel tank farm again.Seward’s waterfront tank farms were destroyed in the 1964 Good Friday Earthquake. The Anchorage-based fuel distributor is negotiating a long-term lease with the Alaska Railroad Corp. for 10 acres of industrial-zoned land on which to construct six fuel storage tanks, according to Yukon Fuel President Larry Shelver.The project depends on obtaining a conditional use permit from the Seward Planning Commission.The $30 million, 28-million-gallon facility would be located between Port Avenue and the south end of the airport runway. Fuel from the farm would be shipped by barge to the company’s markets in western Alaska, Shelver told the Seward Phoenix Log.Established in Fairbanks in 1916, the company obtains fuel by rail from a refinery in North Pole, by barge from Valdez and via highway from Nikiski and distributes it to more than 160 villages throughout Alaska, Shelver said.Yukon Fuel’s acquisition of a 10-million-gallon petroleum distribution facility in Bethel last year prompted the company’s need for an ice-free port from which to ship its product. Seward fit the bill.

Government approves Steller sea lion studies

KODIAK -- Federal officials have approved 26 research projects to examine the decline of the Steller sea lion in the oceans off western Alaska.Money for the studies comes from a $15 million federal appropriation set aside for studies outside the federal umbrella. Altogether, Congress allocated $43 million last year for research on the threatened animals.The projects were approved by Jim Balsiger, National Marine Fisheries Service administrator for the Alaska region, but the list is still subject to review by grant administrators with the National Oceanic and Atmospheric Administration.Research proposals got a two-pronged evaluation. Technical issues were examined by scientists from NMFS, while fishing industry stakeholders also looked at them.According to Pete Jones of NMFS, the two groups generally agreed on which proposals should go forward. The scientists will look at fishermen’s interaction with the Steller sea lion and various predator-prey relationships.The grants are going to local researchers from the University of Alaska and the state, along with outside researchers as far afield as University of St. Andrews in Scotland and the Mystic Aquarium in Connecticut.Janice M. Straley of the University of Alaska Southeast will research killer whale predation in Southeast Alaska waters, where Steller sea lion numbers are increasing, and the proportion that eat marine mammals. She will then compare her data with that from concurrent studies from the Gulf of Alaska and Aleutian Islands. Straley’s research will cost $210,774.The Alaska Department of Fish and Game will spend $64,499 to compile 20 years of notes taken by aerial surveyors during the Cook Inlet herring fishery into a database.A study by the University of Washington will look at whether sea lions in Western Alaska, where the population is threatened, suffer from a lack of certain forage fish compared with the healthy populations further to the east.The biggest project approved by NMFS will spend nearly $1.7 million to implant satellite transmitters in 60 juvenile Steller sea lions, plus a dozen captive animals at the Alaska SeaLife Center, to assess body condition, health and immune systems, and pollutant levels. That study will be conducted by the Texas A&M Research Foundation.

Grants boost marketing to Lower 48

New federal grants are allowing the Alaska Seafood Marketing Institute to expand its domestic marketing efforts for salmon."We’ve got a great story to tell about fish from Alaska," said Barbara Belknap, executive director of ASMI."Not only does wild-caught fish come from a clean ocean environment, something that’s important to consumers concerned these days about food safety and chemical additives, but we can now show that eating salmon is very good for us because of the high Omega 3 fatty acid content, which is healthy for our hearts."And for consumers concerned about the environment and protecting the diversity of wild species, another selling point is that Alaska’s salmon fisheries are now certified as sustainable by the Marine Stewardship Council, an international body working for preserve biodiversity.ASMI received a $3 million federal Economic Development Assistance grant under the federal Trade Adjustment Assistance Act, a federal law that helps domestic industries adversely affected by foreign imports.In this case, Alaska’s industry has suffered because of imports of farmed salmon that are, in many cases, subsidized by foreign governments.The money is being used over three years to enhance domestic marketing. With it, ASMI has been able to hire a fourth marketing representative for domestic sales and to mount a public relations effort to back up retail sales promotions for Alaska salmon."We’ve always used a ’push’ strategy in promotion, working with chefs, retailers, institutions and restaurant chains to get them to try Alaska salmon," Belknap said..Typically, ASMI and its members work with major grocery or restaurant chains in cooperative promotions. This summer, for example, the institute is working with 45 retail grocery chains in the Lower 48, with a total of 5,067 stores participating."Now we can supplement that with a ’pull’ strategy aimed at consumers, trying to get them to ask for salmon," Belknap said. The most effective way to do that is television advertising, but that’s costly and ASMI doesn’t have the money, she said.Instead, the institute has mounted a public relations effort aimed at consumers, which is being coordinated to back up cooperative promotions with retailers and others.David Harrison, an Oregon-based public relations specialist with experience in food marketing, has been working with ASMI since last fall.Through much of the spring Harrison has been working with food editors and other media in regions of the United States where ASMI promotions are under way, and in May he organized a trip to Alaska for 10 editors and food writers for influential magazines.They include Nancy Hopkins, senior food editor for Better Homes & Gardens; Marcella Valedolez, recipe stylist for Bon Appetit; Delia Hammock, nutrition editor for Good Housekeeping Institute; and seven other editors and columnists.Other public relations efforts under way by ASMI include contracting with experts to write articles for nutrition, health and food industry trade magazines.Meanwhile, ASMI’s new West Coast marketing representative will coordinate the institute’s first sustained marketing effort in that region. ASMI has three other marketing representatives, covering the U.S. Southeast, Midwest, Northeast and Southwest.ASMI’s original plan called for six marketing representatives to work on domestic sales, but the institute has never been able to afford more than three. Thanks to the federal grants, that is now four, Belknap said.The West Coast is a different kind of market, however."Previously we concentrated on other parts of the country because consumers there don’t know salmon, and so there’s growth potential."People on the West Coast, however, know and like salmon. But we want them to want wild salmon, which is our salmon," Belknap said.ASMI also gets about $3.1 million a year in federal funds to assist in promotions of export sales of Alaska seafood, but most of its $10 million annual budget is funded by contributions from onshore and offshore Alaska fish processors and a special marketing tax paid by salmon fishermen.

Eco-Challenge team to 'compete well and finish as friends'

FORT RICHARDSON -- Team U.S. Army Alaska is training hard as it prepares to take part in the first Armed Forces Eco-Challenge June 20. Their saga began over a year ago, when Sgt. 1st Class Marc Phipps read about the extreme competition open only to military racers. He immediately decided to get together a team to compete.The Eco-Challenge, Phipps discovered, is sponsored by Tragedy Assistance Program for Survivors Inc., a national peer-support, nonprofit group that helps those affected by a death in the armed forces. Each Eco-Challenge team dedicates its race to one or more members of the military who have died while serving.The winning team earns a place on the roster of the 2001 Eco-Challenge in New Zealand with its entry fee waived.The Armed Forces Eco-Challenge is a 250-mile race through Interior Alaska. It starts at midnight on Summer Solstice. The four-person, mixed-gender teams must all be in the same branch of the armed forces. Team members start and finish together on a course that includes orienteering, pack rafting, canoeing, mountain biking, mountaineering and hiking.For Phipps, 33, his life’s spice is this kind of physical and mental challenge. Growing up in Colorado, he got into climbing, mountaineering and skiing. He joined the Army infantry in 1987 at 19, and re-enlisted when promised a position on the explosive ordnance disposal unit.Duty as a member of the bomb squad at Fort Richardson means midnight flights across the world on a moment’s notice to safeguard VIPs, like the president, or defuse explosive devices.In his off time he explores the Last Frontier and had just summited Mount McKinley with the Army mountaineering team when he learned about the Eco-Challenge."The main thing it means is ultimate suffering," he said. "I really like to get out there and suffer. You push yourself, find out where your edge is and then go over it, push it further."Looking for like-minded individuals in the Army, he remembered a 25-mile cross-country ski trip with a newcomer to the post in 1998. Wearing a pair of the white rocket skis, she was 15 miles into the trip when her binding broke. Instead of whining or giving up, Capt. Vicky Mitchell duct taped the ski to her boot and finished the course with more spunk than style. He called her first."I liked that Marc called me first," said Mitchell. "So many times in these mixed gender teams, the men treat the woman like she is mandatory baggage rather than part of the team."Mitchell, 26, an engineer with Fort Richardson’s Directorate of Plans, Training, Security and Mobilization, has competed in a half Ironman and numerous triathlons. She’s a West Point graduate."My personal philosophy is that it is all about attitude," she said. "In expedition racing, you have to have a great attitude and enjoy what you are doing. The rest of the world may see a 250-mile race as torture, but with the right attitude it is an adventure and the chance of a lifetime."Not long after the team was pulled together, Mitchell ran into her self-defense and gymnastics instructor at West Point, Maj. Kathy Derrick, who is now stationed at Fort Richardson."Vicky told me about the Armed Force Eco-Challenge and I immediately volunteered for the team," said Derrick. "But it was already full. I put up a card on the bulletin board trying to recruit members for another team when Vicky called a couple days later and said one of their members had had to drop out."Derrick, 37, an Army military traffic commander working out of Elmendorf Air Force Base, has four children. With training in sports science, she helped create a training plan for the team.Initially, in January, the focus was on getting fit by doing a variety of exercises. The baseline fitness work done, now the team is building endurance with 8-to-12-hour, multitask workouts every week.Activities include taking power walks with packs, biking uphill and over rough terrain, and working with the single-person pack rafts and two-person canoes that are part of the required equipment for the competition.It was Derrick who suggested someone to whom they could dedicate their race."First Lt. Robert Wilson was a classmate of mine from West Point," she said. "He was an Army aviator, killed in a helicopter crash. His widow, Capt. Dalene Rojas Wilson, also our classmate, is an Army nurse. She was very excited when I asked if we could dedicate our race to him."Team U.S. Army Alaska was selected for the competition in January, and the training began in earnest. Then, another member of the team backed out after being deployed to another location. The team did not have to look far before coming up with a replacement.Mike Derrick, Kathy’s husband and another West Point graduate, was a Ranger in the Infantry until two years ago. At that point, the Derricks became a one-income household. He left the Army to home school their four kids.Mike Derrick has competed in Ironman triathlons and in Nordic skiing. This winter, he completed three ski marathons capped by the Nenana to Fairbanks 100-kilometer Equinox Ultra-Ski on March 17. After he found child care for the race days, he signed on as the fourth member of the team."I think we are going to do well," he said. "Most of the elite adventure racers average 35-45 years of age. That’s the age a person tends to peak psychologically, financially and experience-wise."The Derricks are the watercraft experts on the team. Phipps taught the members the fine points of ropes and climbing before they were certified in early May. Mitchell is the strongest biker on the team. Both men are expert orienteers.Time and money remain the biggest obstacles for the team. Though their individual commanders are supportive of their team, the three soldiers have been unable to get extended time off for multiday training. However, after months of trying, the team finally secured a sponsor -- partners Kay Linton and Kelly Kneaper are donating the $4,000 entry fee to the newly renamed Best Western Golden Lion Team."We are really supportive of (the tragedy assistance) mission," said Linton. "I am a widow so I know the feelings of being left behind. Kelly is interested in helping with the peer counseling. We donated the money because it goes as a fund raiser for the families of victims."This team is Alaskans -- that’s why we picked them," she added. "We are going to be their moral support and their cheerleaders."In addition to the entry fee, the team must purchase a variety of equipment, including the one-person rafts, two-person canoes, and climbing hardware and harnesses. Fortunately, team members already have much of the required gear."We don’t have a one-person glory team," said Phipps. "I’m the team captain because I read it first in the paper.""I think one of our major goals is to compete well and finish as friends," said Kathy Derrick, to the nods of her team members.

June sockeye salmon fishery opens amid tension, uncertainty

Rumors of low sockeye prices, combined with this year’s startling management plan for the June Area M salmon fishery near False Pass, have left area fishermen unsure of the upcoming season and the future of fishing in the region.In January, the Alaska Board of Fisheries made dramatic changes in the management of the fishery in an effort to let more chum salmon swim farther north to Western Alaska rivers.Among those changes, board members implemented new regulations for drift gillnet and seine fleets, cutting about 60 percent of the fishing time, according to Karen Montoya, public information officer for the Aleutians East Borough. Fishermen lost 11 June fishing days -- down from 20 days to a maximum of nine -- in the already heavily regulated season.Just weeks before the June opening, many had already given up fishing. In all, 29 Area M fishermen -- nearly 10 percent of the active fleet -- had filed their intent to transfer or sell their permits.At one time Area M was one of the state’s most lucrative salmon fisheries, with permit prices running $400,000 or more."Permit values have plummeted since restrictions have increased," Montoya said. "This is a big deal because people can’t afford to get out of the fishery at this point. They owe more for the permit than they can make in selling it, and, of course, they don’t have another economic resource to make up the difference. We expect more sales on boats after the fishery is closed."Area M fishermen have decried the cuts in fishing time as a devastating economic blow. The result, they say, will be big catch reductions for a scientifically uncertain goal: propping up depleted Western Alaska chum runs."The Area M salmon fishery really has neighbor pitted against neighbor," said Paul Day, city administrator for Sand Point. "We’re trying to get the word out that we’re not trying to overfish and deplete the stock. We don’t think there’s enough science on this issue to deal with it the way (the board has)."One-third of the residents in the Aleutians East Borough, which encompasses six fishing villages, depend on the June fishery.Adding to the tension are rumors that sockeye prices will be low this year. Though processors say they won’t make any firm price decisions for several weeks, fishermen believe projected low prices mean they will have to fish even more furiously to break even.The Aleutians East Borough has officially asked fishermen to try to limit their chum catch by finding and reporting areas with low chum to sockeye salmon ratios this June. But this may be impossible, according to Borough Administrator Bob Juettner.

Dodge dealer builds with suit pending

Construction is under way this spring on a new Dodge dealership in Anchorage. Lithia Motors dealership aims to join the Anchorage market for new Dodge vehicles previously held solely by Anchorage Chrysler Dodge Center. However, Anchorage Chrysler has filed a suit against DaimlerChrysler that includes a dispute about the new dealership. The new auto sales center is on the Old Seward Highway between Dimond Boulevard and O’Malley Road, adjacent to Lyberger’s Car & Truck Sales LLC, which sells used vehicles. Todd Harris, general manager of Lithia Chrysler Jeep of Anchorage, said the company hopes to open the new dealership in August or September. He did not have figures for the square footage of the new building or its sales lot. Exterior building framework and walls have been erected. General contractor is MCN Construction Inc. of Anchorage. The project architect was Gary Peterson & Associates Inc. of Anchorage, and engineering was completed by Phukan Consulting Engineers & Associates, also in Anchorage. The suit was filed Sept. 10, 1999 in Anchorage Superior Court. "One of the claims is that the granting of a dealership to another entity violates agreements with Anchorage Chrysler," said plaintiff attorney Randall Simpson with the Anchorage office of Jermain Dunnagan & Owens PC. Through legal motions the company sought to delay delivery of Dodge products to a competing dealership until the trial set for Aug. 6, he said. In court documents Anchorage Chrysler contends, "Daimler’s own documents show that the Anchorage area market cannot support another Dodge franchise in Anchorage." Anchorage Chrysler claimed that a new Dodge franchise in Anchorage and a competing Daimler dealer in Wasilla could put Anchorage Chrysler out of business. Consequently, Anchorage Chrysler agreed in May 1999 to share exclusive rights to sell Chrysler and Plymouth products in the Anchorage area with Johnson Jeep, now Lithia Motors, court documents show. In exchange, Daimler said it would allow Anchorage Chrysler to operate a Jeep franchise. Also, Daimler agreed to give Anchorage Chrysler a five-year option to establish a Chrysler, Plymouth, Jeep and Dodge dealership in Wasilla. Anchorage Chrysler said Daimler promised the Alaska company would continue as the sole Dodge franchise in Anchorage. "Daimler breached these promises by executing letters of intent to establish a Dodge franchise in South Anchorage and a Chrysler, Plymouth, Jeep and Dodge franchise in Wasilla," Anchorage Chrysler wrote in a court filing. Attorneys for Anchorage Chrysler contend that "when disputes arose, Daimler immediately retaliated by opening a Dodge (franchise) in South Anchorage and revoking Anchorage Chrysler’s five-year option in Wasilla." During the legal proceedings Lithia Motors purchased Johnson Jeep. Documents say Daimler awarded Lithia Motors a letter of intent Aug. 31 for the franchise in Wasilla and a Dodge franchise in South Anchorage. "There’s a protractible legal battle with DaimlerChrysler" about the new dealership, said Anchorage Chrysler Dodge general manager Matt Thorpe. Anchorage Chrysler Dodge contends its agreement with the automaker allows it to be the sole Dodge dealership within about 100 miles, he said. Competition for price in the market shouldn’t be a factor in adding another dealership, he said. Thorpe believes competition exists in the Anchorage marketplace with Internet sales among other factors, and his company offers competitive prices. "We certainly want the consumer to benefit with the lowest possible prices," he said. The owner of the company has been a Dodge dealer for 27 years, Thorpe said. The suit was filed last year, he said. Jeff DeBoer, chief financial officer for Lithia Motors Inc. would not comment on the new dealership in Anchorage, but said the company would issue an announcement later. In late January Lithia Motors of Medford, Ore., completed its acquisition of its first Alaska dealership, the former Johnson Chrysler/Jeep dealership in Anchorage. Lithia officials said the company’s net investment in the dealership, which totaled $2.8 million, was paid in cash.  

Judge suspends Tongass logging ban

JUNEAU -- A federal judge issued an order May 23 that will allow logging to resume in the Tongass National Forest, pending further review of a case that affects Southeast Alaska wilderness areas. U.S. District Judge James Singleton of Anchorage suspended an order that enjoined actions altering the wilderness character of Tongass roadless areas. His March 30 decision said the U.S. Forest Service breached the National Environmental Policy Act and the National Forest Management Act by failing to evaluate some roadless areas as eligible for wilderness protections. In response, the Forest Service shut down Tongass logging in April. Singleton’s latest order said he will schedule an evidentiary hearing in Juneau as soon as possible to determine the appropriate scope of the injunction. Forest Service spokesman Mike Weber said the agency will allow operators who have timber sales under contract to restart operations. Weber said the action was temporary. "Right now we don’t have any loggers working on the (Tongass). The decision to suspend the injunction comes at a crucial time for the industry. Supply at mills is dwindling," he said. The Forest Service had 67 timber sales under contract when the injunction was implemented, Weber said. The order affects 342 million board feet of timber. Environmental law firm Earthjustice has represented the Sierra Club, the Wilderness Society, the Sitka Conservation Society and the Alaska Center for the Environment in the case. Attorney Tom Waldo described the judge’s latest decision as a setback, especially when combined with other recent decisions affecting roadless areas nationwide. Singleton’s order allows the Alaska Forest Association and Southeast Alaska communities to intervene in the wilderness case. It also allows environmental groups to intervene in a decision that lifted wilderness protections set forth in a 1999 record of decision on the Tongass Land Management Plan.  

Phillips hopes NPR-A finds as hefty as 429-million-barrel Alpine

ANCHORAGE -- Phillips Alaska Inc. has struck oil on five of six wells drilled in the National Petroleum Reserve-Alaska, and geologists believe the wells have hit three separate accumulations of oil and gas.While Phillips Alaska Inc. President Kevin Meyers won’t say how much oil the company expects to find, Phillips is hoping the pools will contain as much oil as the nearby Alpine field, which holds an estimated 429 million barrels. Environmental and logistical studies will be conducted in the area this summer, with more drilling next winter."We’re confident the discoveries will prove to be of commercial quantities," Meyers told a luncheon meeting of the Anchorage Chamber of Commerce.The wells, 15 to 25 miles southwest of Alpine, are the first strikes in the reserve since it was reopened to drilling in 1999. That close to Alpine’s facilities, development should be fairly easy.Phillips holds a 78 percent share of the wells, while Anadarko Petroleum Corp. holds 22 percent. The two companies have the same ownership split at Alpine.One NPR-A well tested at 1,550 barrels of oil a day, plus 26.5 million cubic feet of natural gas, Meyers said.The new oil came a week after Phillips announced that the company had found a satellite field near the giant Kuparuk accumulation. Phillips has a 55 percent share of the Palm field, estimated to contain 35 million barrels of oil.Meyers said Alpine itself was producing well above the company’s targets, with the field reaching 90,000 barrels of oil daily in early May. Alpine, which began producing Nov. 15, was expected to peak at 80,000 barrels a day. The company is working to remove bottlenecks so Alpine can reach its maximum production, Meyers said."But it’s clear there’s oil in the rock," he said.Meyers said the company’s production from the North Slope was increasing this year, not decreasing as the trend has been in the fields in the last decade or so.This year, he said, production will increase 10 percent to nearly 400,000 barrels of oil and natural gas liquids.On the same day the new find in the petroleum reserve was announced, the Bureau of Land Management announced a second lease sale in the northeast corner of the reserve, near the recent find. The sale, scheduled for June 2002, will reoffer about 3 million acres that didn’t receive bids in the 1999 lease sale. The 1999 sale drew $105 million in bids on 967,000 acres.The lease revenues, as well as royalties from NPR-A, are split evenly between the federal government and the state of Alaska.

Around the World June 3, 2001

NationConsumer confidence rises in May NEW YORK -- A string of interest rate cuts, stronger financial markets and the prospect of lower taxes all helped lift consumers’ confidence in May, analysts said.The New York-based Conference Board said May 29 its Consumer Confidence Index rose to a greater-than-expected 115.5 in May, up from a revised 109.9 in April, despite continuing layoffs and surging energy prices."This is surprising," said Sherry Cooper, chief economist at Harris Bank. "I guess you just can’t keep the American consumer down."Analysts had expected a reading of 112.0 in May. The sharp rise, which reflects growing consumer optimism about jobs and the economy, also came after April’s confidence numbers dipped from a reading of 116.9 in March.But the May index is still weak in comparison to where it has been in the past five years, Cooper said. Last May, the reading reached 144.7.Economy still drags in first quarterWASHINGTON -- The U.S. economy limped along in the first three months of the year at a pace much slower than previously thought. The biggest drag on growth came from companies struggling to get rid of their unsold goods.Gross domestic product -- the country’s total output of goods and services -- grew at an annual rate of just 1.3 percent from January to March, the Commerce Department reported May 25.The latest GDP was much lower than the government’s estimate one month ago that the economy had expanded at a rate of 2 percent during the first quarter, a pace that surprised many and raised hopes that the severe slowdown that began last summer was coming to an end.Feds take in $3.6 billion in online salesWASHINGTON -- Want to buy a helicopter? How about a Lamborghini Diablo sports car, a decommissioned Coast Guard cutter or a 4-year-old wild horse? The government may have one to sell you on the Internet.With sales that exceed those of large Web retailers such as Amazon.com, federal agencies increasingly are using e-commerce to pitch wares, from luxury items seized by law enforcement to military surplus goods to plain old documents.In all, federal agencies took in $3.6 billion in online sales last year, according to a survey released May 27 by the Pew Internet and American Life Project and Federal Computer Week magazine.The lion’s share -- $3.3 billion -- came from the Treasury Department’s sale of bonds and notes.Senator to look into oil mergers, gas pricesWASHINGTON -- The Democrat poised to take over as chairman of a Senate investigative panel said he plans to look into the effect of oil industry mergers on the increase in gasoline prices."The oil companies need to explain why gas prices have increased so dramatically given that there has been no comparable increase in the per-barrel cost of oil to them,’’ said Michigan Sen. Carl Levin.An oil industry representative said May 27 that the companies were not conspiring to raise prices, and cited lower output by oil-producing countries and too few U.S. refineries as reasons for the higher prices.WORLDRussian oil company faces tax investigationMOSCOW -- Russian oil company Sibneft is being investigated for alleged tax violations by Russian prosecutors, a company spokesman said May 25.Sibneft spokesman Nick Halliwell said that prosecutors had opened a criminal case against the company. He said the matter had previously been investigated by the tax police and was resolved in Sibneft’s favor.The investigation concerns allegations that Sibneft failed to pay $12 million to $14 million in value-added taxes and obtained tax privileges to which it was not entitled, the Interfax news agency said, citing the press service of the prosecutor general’s office.The report also said the prosecutor general’s office is investigating alleged embezzlement by the management of Sibneft."We’re aware of the investigation, but we are not in any way concerned by it,’’ Halliwell said, adding that the company was "surprised’’ by what he said was a repeat investigation.DaimlerChrysler taps turnaround expertBERLIN -- DaimlerChrysler AG replaced the head of its North American truck unit May 25, tapping a turnaround expert to stem mounting losses at the region’s biggest truck maker.The German-U.S. auto giant said it accepted the resignation of Jim Hebe, who had led the Freightliner unit since 1992. It named a former Freightliner finance chief, Rainer Schmueckle, to take over immediately."It is a tough situation in the United States and Freightliner was hit heavily,’’ said Michael Pfister, a DaimlerChrysler spokesman in Stuttgart, Germany. The company described Schmueckle, 41, as a "proven turnaround expert.’’Mazda reports largest yearly lossTOKYO -- Falling car sales and losses for pension and retirement payments left Mazda Motor Corp. with a loss of $1.3 billion for the fiscal year ending in March, its biggest annual deficit ever.Its loss of 155 billion yen last year contrasted with a group net profit of 26 billion yen a year earlier.Mazda President Mark Fields said May 25 the Hiroshima-based automaker hoped to break even for this fiscal year ending in March 2002 on sales of 2.1 trillion yen, or $17.5 billion. But he acknowledged that competition was tough, especially in Japan where Mazda plans no major new models.The Japanese automaker which is 33.4 percent owned by Ford Motor Co. was unprofitable this past year in all three of its main markets -- Japan, North America and Europe.Market share in the United States improved by 0.1 percent to 1.5 percent.Compiled from business wire services.

Aleutian chain communities work to transform their economies

The fishing industry is the lifeblood of the Aleutian Islands, and some see the industry going into an economic tailspin due to increasing fishing restrictions."But the sky is not falling," said Paul Day, city administrator for Sand Point. He and others throughout the region point to many economic development projects under way to help transform the local economies.For example, state and federal construction projects in the Aleutians East Borough for 2001-2003 amount to more than $41.6 million.Here are some project highlights:AkutanCurrently, there’s no boat harbor in Akutan, limiting fishermen to small vessels, which keeps them from tapping into near-shore fishery opportunities. Construction plans are under way for a small and large boat harbor.To move the project forward, the Aleutian Pribilof Island Community Development Association, one of the six community development quota groups in Western Alaska, has committed $1 million and the Aleutians East Borough has committed $2 million. Additional funds are being identified.Construction of the large harbor should begin in 2004. The approximately $980,000 small boat mooring basin, with a capacity of about eight small skiffs, may be completed this summer by West Construction.APICDA and the city of Akutan also are discussing establishing a small seafood company that would enable local residents to purchase and market all of the local product. To avoid the cost of constructing a processing facility, the company would contract with Trident Seafoods for custom processing.The state Department of Transportation and Public Facilities reports that bidding on a $1 million harbor access road will begin in October and construction will be completed in September 2003.AtkaAPICDA and the city of Atka intend to develop Atka as a ship supply and support hub for fishing vessels operating in the western Aleutians.Atka Pride Seafoods plant is a joint venture between APICDA and the Atka Fishermen’s Association."We have a 900,000-pound quota out there, and we expect to catch it all this year," said Chris Mierzejek, director of administration for APICDA.By next year, the plant expects to be operating about nine months a year, up from the current 5 1/2 months, and also processing sablefish, Pacific cod, Adak brown king crab and other groundfish species. APS is considering the construction of a new, larger processing facility next year.A new 7,000-square-foot, 10-room lodge in Atka, constructed by APICDA’s inhouse construction team and a few locally hired laborers, should open Aug. 1. Future plans call for employing tourism guides and adding a display case for selling local arts and crafts.By the end of summer, APICDA’s construction team should complete a $140,000 storage unit for working on boats.Cold BayWork will soon begin on a feasibility study to determine whether to clean up or replace the old landfill, in Cold Bay said Sharon Boyette, the Aleutians East Borough’s coordinator of community development.The bidding on two DOT projects -- a $3 million airport runway resurfacing and safety area expansion and a $255,000 airport generator building replacement -- should begin in October with construction ending in September 2002.False Pass/Nelson LagoonThe Aleutians East Borough and the city of False Pass propose to construct a nearly $13 million small boat harbor with a protected mooring basin of 5.2 acres that can accommodate 88 vessels. Currently, no protected moorage exists within the fishing grounds around False Pass, curtailing fishermen’s operations and subjecting the vessels to possible damage.The federal costs are estimated at $8.5 million, and the local share at $4.3 million. The borough plans to finance $2 million and is looking to the Alaska Legislature for an additional $2 million. The U.S. Army Corps of Engineers is working on the final design and construction may begin in about a year, according to Boyette.Since opening in June of last year, Bering Pacific Seafoods has processed about 2.5 million pounds of salmon and Pacific cod, Mierzejek said. Once the new boat harbor is in operation, BPS intends to construct a shoreside processing facility that will expand its current production capabilities.Currently, APICDA has initiated a feasibility study of opening a store in False Pass.Preliminary designs are now complete for improving the water systems in both Nelson Lagoon and False Pass. Total project cost for Nelson Lagoon is $7.5 million; False Pass is $750,000.King CoveAbout $9 million in construction projects are under way in King Cove, said Karen Montoya, the borough’s public information officer. The list includes harbor improvements and water and sewer jobs.Western Marine Construction will finish the boat harbor dredging project this summer and the float system in September. The King Cove harbormaster, Eddie Mack, said the new harbor should be able to collect around $200,000 in revenue annually.On May 18, King Cove received enough money for a new medical clinic, nearly three years after Congress appropriated $2.5 million. The Denali Commission, which channels funding into the state, awarded Eastern Aleutian Tribes $1.6 million for the new facility. SKW/Eskimos Inc. plan to begin construction in June.The new clinic brings state-of-the-art telemedicine capabilities; medical, dental and behavioral care under one roof; a monitoring room for overnight patients; and an emergency room that allows treatment of more than one patient at a time.Efforts to connect King Cove and Cold Bay are progressing slowly. About 11 options are being considered, including a hovercraft out of Leonard’s Harbor and out of Cold Bay Harbor, a road through Native lands with an elevated causeway and a road going through the wilderness.NikolskiThe Nikolski Lodge, a joint venture between APICDA and the Native village corporation of Nikolski, will be open for business Aug. 1 and will employ six local residents.APICDA also is heavily lobbying for a local airstrip approved for passenger volume, Mierzejek said. Currently, the U.S. Air Force, which owns the existing airstrip, is negotiating for a land swap with the Native village corporation of Nikolski. Once that happens, upgrades will be planned to accommodate larger planes on a commercial basis."The (improved) airstrip will mean more reliable transportation for the lodge activities and for the community," Mierzejek said.Another ongoing APICDA project this summer is the refurbishment of a plant that processes meat from the island such as reindeer and cattle.Sand PointIn line for water and sewer improvements, Sand Point also is planning several airport improvement projects, said Paul Day, city administrator."DOT hopes to have this (airport) contract out to bid by October or November," he said. The runway will be extended from 4,300 feet to 5,000 feet and the safety margins will be expanded for FAA compliance. Also, the runway and road leading to it will be paved.The new airport will accommodate larger aircraft and allow the community to fly fresh fish out of Sand Point, "rather than just freezing them and barging them out which is what we’ve been doing," said Day. Additionally, Pen Air is the only carrier to service this region. Day is hopeful that a larger runway will lure another air carrier.St. GeorgeSeveral island entities -- the city of St. George, the Traditional Council, the St. George Tanaq Corp., the Fishermen’s Association and APICDA -- are studying the viability of a small sport fish tourist operation.UnalaskaA $9 million project to add a 500-foot extension to the Unalaska Marine Center dock will go out to bid this summer, according to Dave Kemp, the public works and utilities director.Current construction projects under way include two small roadway bridges at $1 million each -- one awarded to West Constructionand the other one in the design phase with no contractor yet. Also, the $11 million elementary school construction project should be completed by Ty-Matt Inc. by the end of October or early November.

Expensive unpaid, overtime wages are costs that can be avoided

Claims for unpaid wages and overtime can be among the most costly employers will face. Yet, at the same time, these claims can be easily avoided. To avoid such claims, employers simply must educate themselves as to the requirements of Alaska law and then follow those requirements.Among the easiest claims to avoid are claims for failing to pay terminated employees all compensation to which they are entitled within the time specified by law. If an employer terminates an employee, then the employer must pay the employee all compensation within three working days after the date of termination. If an employee quits, then the employer must pay all compensation that is due "at the next regular payday that is at least three days after the employer received notice" of the resignation.For instance, if the employee quits with no notice, then the employer complies with Alaska law if the employer pays the employee all compensation due on the next regular payday.However, if the employee quits, but gives substantial notice, there will likely be a pay- day more than three days after the employer receives notice, but before the employee’s last day of work. In that situation, the Alaska Department of Labor expects employers to pay the employee all compensation due on the last day of employment.If the employer fails to pay the employee all compensation due at the end of the employment relationship by the time required under Alaska law, then the employer can face a penalty equal to a maximum of 90 days of the employee’s salary. This penalty is easily avoided if the employer simply pays the employee what it should within the time required after the employment relationship ends.Employers can also avoid potential claims for unpaid overtime compensation by ensuring that they have properly classified employees as being exempt from overtime requirements. Often, claims for unpaid overtime compensation are brought by "working managers" who were improperly classified as being "exempt" from overtime requirements and were not paid overtime.In classifying employees as "exempt" or "non-exempt" for purposes of determining whether the employee must be paid overtime, an analysis of the employee’s actual job responsibilities is necessary.Many times, "working managers" will have many responsibilities that suggest they should be exempt from overtime requirements, but they will also spend a significant amount of time performing the exact same duties as those performed by their subordinates.If a manager spends too much time performing "nonexempt" duties, then the manager will not be considered exempt from the requirement to pay overtime for hours worked beyond eight in a day or 40 in a week.For instance, in a "retail or service establishment," employees who are considered exempt executive or administrative employees can only spend an maximum of 40 percent of their time performing nonexempt job duties. In any other business, the time an exempt executive or administrative employee can spend performing nonexempt job duties is limited to 20 percent.If an employee is employed in a "supervisory capacity," which means an individual employed "solely for the purpose of regularly assigning and directing the activities of other employees," then the employee cannot spend more than 20 percent of his or her time performing "duties regularly performed by the employees supervised."If an employee has been misclassified, and brings a claim for unpaid overtime compensation, the employer could face substantial liability. Not only will the employer owe the unpaid overtime, but the employer may also face a liquidated damages penalty equal to the amount of unpaid overtime. Further, if the employer loses, the employer will also likely have to pay the employee’s attorney their full reasonable attorneys’ fees.To ensure that employees have been properly classified for the purposes of overtime compensation, employers should periodically review each employee’s job description and review what the employee is actually doing during a normal workday and workweek.Paying employees who are entitled to overtime compensation for the overtime they work is much more cost-effective than facing a potential expensive lawsuit for unpaid overtime compensation.Employers should consult with their legal counsel to ensure they have properly classified employees and to ensure that their payroll policies otherwise comply with the requirements of Alaska law.Kimberlee Colbo is a member of Hughes Thorsness Powell Huddleston & Bauman LLC in Anchorage. She can be reached via e-mail at ([email protected]).

VECO is Exporter of Year

Gov. Tony Knowles has chosen VECO Corp. as Alaska’s Exporter of the Year. The award was presented May 24 during the annual Export Alaska banquet held in Anchorage. The company was honored for services it handles around the world, including work in Russia, China, Kuwait, India, Central Africa and Egypt, according to the governor’s office. "We feel like it’s a real honor," said VECO President Pete Leathard. "It’s important for an engineering construction company to win an award like this. We’re not an exporter of things. We’re really an exporter of knowledge." VECO Corp. employs about 4,500 people including 2,000 who work in foreign countries, state officials said. "VECO is an Alaska-founded and Alaska-owned company that exports project engineering, construction and operations expertise around the world," Knowles said in a statement. VECO Corp. was runner-up for the award last year and in 1999. Williams Alaska Petroleum Inc. was chosen runner-up for the award. The company operates a refinery at North Pole that processes about 215,000 barrels of Alaska crude oil daily. According to state officials, Williams Alaska Petroleum converts 63,000 barrels daily into refined product used in Alaska and foreign markets like Japan and Taiwan. The company also is co-owner of the Anchorage CargoPort at the Ted Stevens Anchorage International Airport, which added between 75 and 100 jobs last year, state officials said. Honorable mention was given to Arctic Geoscience Inc. of Anchorage. The earth science and engineering company is involved in various exploratory and development activities in Germany, Kazakstan, the Netherlands and Russia. The Exporter of the Year award is presented annually to companies based on their impact on the Alaska economy, new market development and export growth.  

Pages

Subscribe to Alaska Journal RSS