Holiday Inn, Aspen Hotel construction to add 140 rooms

Construction continues on two hotel projects set to add 140 rooms to the Anchorage market.Work has started to expand the Holiday Inn Express in Anchorage. The project will add 50 rooms to the 78-room hotel, said Teresa Wasson, regional director of sales and marketing for the Alaska division.The Holiday Inn Express in Anchorage is operated by a national hotel management company, The Hotel Group, based in Edmonds, Wash. The Anchorage hotel, at 4411 Spenard Road, opened in June 1999.Construction began in early January and should be completed by June, Wasson said. The project also will expand seating in the hotel’s breakfast area and add microwaves and refrigerators to all rooms. Previously, microwaves and refrigerators were available in 30 rooms on the executive level, she said.Although Wasson did not list the value of the project, the contractor, A&A Construction and Development Inc., received a city building permit in August for a $2.3 million hotel addition.The Spokane-based general contractor is part of the ownership group, she said.Since the hotel opened three years ago, operators of the Holiday Inn Express in Anchorage said the property exceeded their goals. Wasson also believes future demand will stem from the expanded Ted Stevens Anchorage International Airport and overall travel to and from Alaska.Holiday Inn Express is geared to business travelers, and Wasson said the brand is capitalizing on a trend that business travelers are more inclined to stay at hotels with limited rather than deluxe, downtown facilities. The hotel differs from others, she said."We are the only hotel in the city that has the pool, spa and fitness center open 24 hours," she said.In other Anchorage hotel construction news, builders have nearly enclosed the 90-room Aspen Hotel, adding a fifth hotel to a statewide chain.Work on the hotel, which began last June, should be complete in late May, said spokeswoman Megan Sumner. Aspen Hotel should open by June 1, she said.City building permit application records show the project is valued at $4.9 million. Western Steel is general contractor and parent company of the hotel. Aspen Hotel has sister hotels in Fairbanks, Juneau, Soldotna and Valdez as part of GuestHouse Inn & Suites.The 97-room Fairbanks hotel opened last May. The 63-room hotel in Soldotna is scheduled to open in April."Our goal is to garner loyalty from critical partners in the oil, gas and fishing industries, as well as in the leisure market," Sumner said. "These are hotels for Alaskans to work and play in."The Anchorage Aspen Hotel at 8th Avenue and A Street should employ about 25 people, Sumner said. The hotel will feature extended stay suites similar to a one-bedroom apartment, a spa suite with a four-poster king bed and a whirlpool bath, plus family suites with a king bed for parents and children’s bunk beds in an adjoining room with a television, videocassette recorder and Sony Playstation. Another suite, called the Aspen Suite, will total 1,100 square feet and features a balcony, indoor spa, steam room and bar.All rooms will have refrigerators, microwaves, coffee makers and VCRs, she said.By late January builders were to complete roof work, Sumner said. Subsequent work will include interior framing, she said.

Trucker traces roots to Gold Rush

Sourdough Express Inc. has been hauling freight since 1898 using everything from beasts to big rigs.While the mode of moving freight has changed in 104 years, the company’s philosophy of dependable service and customer satisfaction hasn’t.Robert "Sourdough Bob" Ellis started the company during the Klondike Gold Rush in Dawson City, hauling prospectors’ equipment by dog sleds or horse-drawn wagons, depending on the season.According to company history, Ellis was a one-man operation through the Klondike strike, moving supplies for miners through some of the most treacherous territory known. When gold was discovered in the Tanana Valley in 1902, Ellis pulled up stakes and moved to Fairbanks to tend to the gold miners there.It proved to be a good move for Sourdough Bob and the business.Today, the Fairbanks-based moving and freight company and its subsidiaries have more than 100 full-time and another 100 seasonal employees, a fleet of 150 trucks and trailers, and is an agent with major worldwide mover, Global Van Lines Inc.In 1923, Ed Herring bought the business from Ellis, who had begun using Ford Model T trucks to haul freight in town, but still depended on dogs and horses to pull sleds and wagons on the rugged roads out of town to villages and mining camps.Jeff Gregory, Herring’s great-grandson and current president of Sourdough Express, said Ellis died shortly after he sold the business, about the same time the wagon trail from Valdez to Fairbanks was transformed into the Richardson Highway.Gene Rooge, Herring’s son-in-law and pioneer Fairbanks trucker, made the first trip on the new highway in 1929, hauling eight barrels of gasoline from Valdez to Fairbanks in a 2-year-old Chevrolet truck. The 270-mile trip took two days down and three days back to Fairbanks.The Richardson Highway became a lifeline to Fairbanks from Valdez, where a ship from Seattle would arrive about three times a month, laden with groceries and other goods.Though the Richardson Highway was a vast improvement over the old wagon trail, the road was still far from perfect, Gregory said. But Sourdough Express prided itself in successfully hauling crates of eggs along the rough road.Sourdough Express today touts its packers and drivers, who are careful to make deliveries undamaged. The company says it has one of lowest claim costs in the industry.While gold and oil strikes over the years helped contribute to the success of Sourdough Express, World War II brought more business to the trucking company. According to the company, there were times when a truck left the Valdez port every eight minutes, hauling military cargo to the Interior, a journey greatly helped by a newly built bridge over the Tanana River.Trucks began hauling supplies to the North Slope in 1974 over the Dalton Highway, a 520-mile trip from Fairbanks. Under the reign of then-president Whitey Gregory, who married into the family in 1957, the company grew fourfold.At the height of the oil boom, Sourdough had about 70 trucks delivering supplies to Prudhoe Bay, with drivers averaging about two trips a week.

Red Dog's new trucks keep tight seal on dust

A new $4.2 million fleet of trucks with tightly covered trailers is being used along the Red Dog Mine haul road to move more ore and to reduce the potential of spilling lead and zinc concentrate.Ten new tractors with dual 130-ton capacity, hard-covered trailers have replaced NANA/Lynden Logistics LLC’s old fleet, which had far less capacity and used tarps to cover the loads, said Dave Roper, NANA/Lynden president.Each set of trailers costs about $250,000 and are made by Alpine Trailers, a Canadian company, Roper said.Similar but smaller trailers built by the company are used in Australia and Canada, Roper said.Each tractor, made by Mack Trucks Inc., costs about $170,000, Roper said.Nine tractors and trailers were shipped to the Red Dog Mine site last summer, and have been phased in since last fall. A 10th tractor-trailer will be added next summer, Roper said.The company hauls ore concentrate for mine operator Teck Cominco Alaska Inc. along the 52-mile haul road from the Red Dog Mine to a port on the Chukchi Sea.About 20 miles of the road runs within the Cape Krusenstern National Monument, and that portion has been scrutinized by the National Park Service. The agency last summer released a report saying high levels of zinc, lead and cadmium metals in Red Dog Mine concentrates, were found in mosses along the side of the haul road, presumably from trucking operations.An Anchorage-based environmental group called for a closure of the haul road, but the state Department of Environmental Conservation denied the request, saying the levels were below those required to be cleaned up under state law.Roper said the company was in the process of bringing the trucks and new trailers on line before the National Park Service issued its report. Red Dog officials have criticized the report, saying it did not get the appropriate peer review."We made the decision long before the concerns of the National Park Service of what may or may not be along the road," Roper said.The Alaska Industrial Development and Export Authority owns the road and port that serve the Red Dog.John Wood, AIDEA’s project manager, said his agency believes the source of the metals along the roadside is from dust that had collected on the trucks during loading and unloading operations and fell off between the mine and the port.The mine has been in operation for a dozen years, and some 1.3 million tons of concentrate was trucked last year along the haul road, said Wood, adding that he has never seen zinc and lead concentrate blowing out of a trailer."It’s not to say in the early days it didn’t happen, but in my nine years, I’ve never seen it happen," Wood said.Trucks and trailers are now being washed and vacuumed, and a series of curtains and baffles have been added at buildings where the trucks load and unload to keep the dust from escaping, Wood said.Teck Cominco has reported about 30 spills of ore concentrate over the years because of trucking accidents. Four have occurred in the past year, the company has said.David Spirtes, superintendent of the Cape Krusenstern National Monument, said the National Park Service has been concerned about the accumulation of the heavy metals along the roadside for several years. He said his agency’s report "probably speeded up the replacement of the trucks."Sprites said he has noticed fewer trucks on the haul road.Roper of NANA/Lynden said that has been the intent all along, since the new trailers haul about 50 more tons per load than the ones they replaced.Roper said the company expects the new trailers to last from seven to 10 years. Tractors can be used about four years before needing replacement, he said.

Business Profile: CCI Inc.

Name of the company: CCI Inc.Established: 1989Location: 800 Cordova St., Suite 102, AnchorageTelephone: 907-258-5755Web site: www.ccialaska.comMajor focus of services: CCI Inc. provides construction services including new construction, improvements and maintenance. The company also handles environmental services like spill response, remediation, site assessment and asbestos abatement.History of the company: CCI was founded in Fairbanks and in 1992 started handling work at Prudhoe Bay for oil companies. Through 1998 that oil field focus contributed to a majority of CCI’s business.Bristol Bay Native Corp. purchased the company in January 1998. CCI then diversified its services to other industry sectors.CCI has worked for federal, state and private clients. The company has provided workers for major cleanup projects including a spill from the freighter M/V Kuroshima at Dutch Harbor, Alaska Railroad spills and a gunshot-triggered spill on the trans-Alaska oil pipeline last year. CCI also has contracts with BP Exploration (Alaska) Inc. and Alaska Clean Seas for work on the North Slope.The company employs an average of 60 full-time staff members, and peak employment can reach 120 workers.CCI recorded its best year in sales and earnings for its fiscal year that ended last March. This year CCI expects to exceed that tally, said Mark Hylen, president and chief executive.In addition to its Anchorage and Prudhoe Bay offices, CCI opened an office in Tukwila, Wash., last fall in an effort to pursue Pacific Northwest work and reach Seattle-based government offices handling Alaska work.In the last two years, CCI has helped develop a sister company, Kakivik Asset Management LLC, which handles oil field inspection contracts for Alyeska Pipeline Service Co. and Phillips Alaska Inc. at Kuparuk. Kakivik is also owned by engineering firm CH2M Hill.Top accomplishment of the company: CCI President Hylen cites his company’s Alaska Native hire record, which was 28 percent of the total work force in 2001. As a subsidiary of BBNC, the firm also aims to hire shareholders of the Native corporation.Major player: Mark Hylen, president and chief executive, CCI.Hylen, who was born and raised in Alaska, spent summers between 1992 and 1994 working for CCI as a field laborer. In 1995 he earned a bachelor’s degree in business administration from California Polytechnic State University in San Luis Obispo. He returned to CCI to work as a business manager based in Fairbanks and was later appointed general manger. Hylen was chosen president and chief executive in late 2001.-- Nancy Pounds

Around the World January 27, 2002

STATECompany seeks permits for northern gas lineFAIRBANKS -- A Houston-based company has applied to Canadian authorities for approval of its proposal to ship North Slope natural gas to market by a route that would bypass Interior Alaska.Arctic Resources Co., through its Canadian affiliate, on Jan. 16 filed a "preliminary information package" with the National Energy Board of Canada. It is the first step for the company to receive approval from Canadian energy officials for the "Over-the-Top" route proposal, a process that could take two years.The Over-the-Top proposal calls for North Slope natural gas to be shipped offshore through the Beaufort Sea to the Canadian Arctic, then south through Canada. The pipeline also would pick up Canadian gas in the Mackenzie River Delta on its way to the Lower 48.The Over-the-Top route faces strong opposition from Alaska members of both Congress and the Legislature, who argue that it would export the state’s resources without providing jobs for Alaskans and the opportunity for in-state use of the gas.Sealaska announces joint venture in plasticsJUNEAU -- Sealaska Corp. and Nypro announced Jan. 17 they have entered into a joint venture for a plastics injection molding operation in Guadalajara, Mexico.The molding operation, TriQuest Guadalajara, previously was fully owned by Sealaska.The Juneau-based Native corporation will continue to own and control a majority of the firm. Nypro will own a minority share and operate the facility under a management agreement.The announcement was made jointly by Sealaska President Chris E. McNeil Jr. and Nypro President Brian S. Jones.McNeil said he expected the arrangement would increase the amount of work the plant receives from major electronics and computer manufacturing firms.Alaska unemployment rate up but still lowANCHORAGE -- Alaska’s unemployment rate rose in December, when about 18,650 people were jobless and looking for work.December’s rate was 5.8 percent, an expected seasonal increase from November’s 5.6 percent rate, the state Labor Department said Jan. 18.Anchorage had the lowest unemployment rate in the state, holding steady at 3.7 percent in December.The total number of unemployed was lower than during December 2000 in both Alaska and its largest city, the department said.In other parts of the state, the December jobless rate was: 6.7 percent in the Matanuska-Susitna Borough; 10 percent in the Kenai Peninsula Borough; 12.9 percent in Kodiak; and 9.7 percent in the Valdez-Cordova area.The national unemployment rate grew to 5.4 percent in December from 5.3 percent in November.Count indicates Belugas may be more abundantANCHORAGE -- The Cook Inlet beluga whale population continues to show signs of recovery after a decade-long decline.The National Marine Fisheries Service reports that an aerial survey conducted last June counted 211 whales. From that, federal scientists estimate there are 386 whales in the Inlet.The increase marks the fourth year in a row that scientists have seen an increase in beluga numbers in the Inlet."I would say it’s good news in that comparing this to 1998, it shows more than a 3 percent annual growth rate," said federal biologist Rod Hobbs of the National Marine Mammal Laboratory in Seattle.Once thought to number 1,300 in Cook Inlet, the number of whales in this genetically isolated group dropped to about 350 in 1998 and 1999.A lawsuit arguing that the whales need additional protection under the Endangered Species Act from a broad range of other human factors continues in federal court.NATIONKmart Corp. files for bankruptcy protectionDETROIT -- Kmart Corp., known for its BlueLight Special and discount prices, filed for bankruptcy protection Jan. 22, becoming the largest retailer to seek shelter from creditors under Chapter 11.Kmart has struggled in the fiercely competitive discount market against rivals like Wal-Mart and Target.The filing comes a day after a major food distributor, Fleming Cos., said it had cut off most shipments to Kmart because the discounter failed to make its regular weekly payment for deliveries. Fleming said Kmart, its largest customer, owes $78 million.Other suppliers have delayed or stopped shipments to Kmart in recent days, but the Fleming situation posed perhaps the biggest crisis yet, because grocery offerings often drive traffic.Fleming said it intends to resume deliveries to Kmart "upon receiving satisfactory assurances from Kmart, via the bankruptcy court."Kmart operates five stores in Alaska.WORLDPrincess rejects latest bid from rival CarnivalLONDON -- P&O Princess Cruises PLC balked Jan. 21 at a sweetened takeover bid by Carnival Corp., the world’s biggest cruise ship operator, arguing the $5 billion offer was still too low and was likely to run aground on regulatory concerns.Princess insisted it would stay on course with its own plan to merge with rival Royal Caribbean Cruises Ltd., the world’s second-largest cruise company.After Princess, headquartered in London, turned down its original bid, Miami-based Carnival followed up Jan. 17 with a revised cash and shares offer worth 12 percent more. Carnival is eager to break up Princess’ planned merger with Royal Caribbean, which would create a $6 billion business that would sink Carnival as market leader.All three companies operate cruise ships in Alaska waters."We made it clear when Carnival made its initial proposal that our response was based on two simple criteria -- value for our shareholders and deliverability. The revised proposal still falls short on value and adds nothing on deliverability," Princess’ chief executive Peter Ratcliffe said in a statement. -- Compiled from business wire services.

Dillon acts as big rigs' biggest booster

Whether in a public forum or on the street, Frank Dillon never misses the opportunity to drive home his point about the importance of the trucking industry and the need for improved highways."If you got it, a truck brought it,’’ said Dillon, executive vice president of the Alaska Trucking Association Inc. "Trucking is not a necessary evil. It’s as vital to our way of life as blood is in your body."Whatever is eaten, worn or otherwise consumed and then disposed was delivered or hauled off in a truck, says Dillon who has represented the 300-member state trucking association for the past 13 years.Dillon has never driven big rigs commercially, although his bearlike stature and flat-top haircut would likely make him hard to pick out at a truck stop. An anthropologist by education and a lobbyist by trade, Dillon is a master public speaker and parliamentarian, attending scores of meetings that are in any way transportation related, promoting the trucking industry, its importance and image."Everything goes on a truck one way or another,’’ Dillon said. "We don’t understand, as a citizenry, transportation. People are mystified by it and take it for granted. Without the trucking industry people would not have the opportunity to make choices from the clothes they wear to the food they eat."Trucking is the ninth largest employer in the United States, and holds about the same ranking in Alaska, where about 22,000 people bring home a paycheck from a trucking-related industry, Dillon said.Commercial trucks and trailers make up about 5 percent of the total vehicle registrations in Anchorage, according to the state Division of Motor Vehicles. The number of registered commercial vehicles act as a indicator of the state’s financial health, as registrations rise and fall with Alaska’s economy, according to DMV statistics.There are about 35,000 Alaskans who hold commercial driver’s licenses, though not all work in the industry at any given time, Dillon said.The trucking industry contributes about $700 million annually to the state’s economy, Dillon said.Trucking, Dillon said, is what ties all other transportation modes together. In Alaska, truckers and their companies enjoy a cooperative relationship with airlines, the railroad and oceangoing shippers, Dillon said.The trucking organization also has a good relationship with trucking unions in the state, something that isn’t always the case elsewhere, Dillon said.In the Lower 48, the trucking industry and railroads often vie for the same freight. But in Alaska, the trucking industry and the Alaska Railroad Corp. complement each other, Dillon said."Trucks here to not compete with the railroad, and we don’t have an adversarial relationship with them,’’ Dillon said.The railroad last year pulled more than 36,000 100-ton hopper cars from Palmer to Anchorage. Dillon said it would be impractical, unsafe and cause much wear and tear on roads if trucks were to haul those loads.Alaska has about 15,000 miles of roads, only about 22 percent of them paved, according to state Department of Transportation and Public Facilities.Alaska needs more roads and increased maintenance and improvements to those it has, Dillon said.According to state estimates, nearly $8 billion is needed to bring the state’s roads and transportation facilities to an acceptable level.Improvements to the state’s transportation infrastructure make roads safer for truckers and motorists, lowers the cost of moving goods, and the air becomes cleaner when traffic is not congested, Dillon said.But building roads takes too long, largely because of an onerous environmental review process that can stop a road project or delay it for many years, Dillon said.He has led a nationwide effort to streamline the National Environmental Policy Act, a law crafted 30 years ago that requires government agencies to consider affects to the environment by federally funded projects.Dillon says he supports the intent of the law, but it’s being used as "a roadblock to road building," because it has been abused and distorted by road-building opponents and environmentalists."We have to go back and change the National Environmental Policy Act," Dillon said. "NEPA has been absolutely manipulated and has become a bureaucratic Christmas tree, designed to impede infrastructure development."Today, if we wanted to build the Parks Highway, it couldn’t be done,’’ Dillon said. "If you fill in a wetland, it is a crime."Dillon has worked with his contemporaries in nationwide trucking organizations, and with Rep. Don Young, R-Alaska, chairman of the House Transportation and Infrastructure Committee, to streamline and make less burdensome the environmental review process for highway construction and improvements.Young, Dillon said, is committed to amending the environmental review process, a key feature to the Transportation Equity Act for the 21st Century, which expires at the end of the year.Young will be the principal architect in the legislation, which provides billions of federal dollars for planning and building transportation projects in the United States over the next several years.Another major issue facing the trucking industry, and ultimately consumers, is a new federal ultra-low sulfur diesel requirement used for highway vehicles.The requirement goes into effect in four years, but Alaska may be given an extension to 2010.Still, Dillon said, because vehicle engines will be built starting in 2007 to use only the low-sulfur diesel, the fuel will have to be made available in the state.Dillon’s organization has estimated that the new fuel could add 20 to 25 cents a gallon to existing prices, which will make for increased freight rates.

This Week in Alaska Business History January 27, 2002

Editor’s note: "This Week in Alaska Business History" revisits events that shaped our past."Those who cannotremember the past arecondemned to repeat it."-- George Santayana, 1863-195220 years ago this weekAnchorage TimesJan. 28, 1982Gas pipeline package fight moves to courtBy Betty MillsTimes Washington BureauWashington -- In a move that could substantially delay the Alaska pipeline project, a group of 24 members of Congress, five states and several consumer groups joined in a lawsuit to overturn the pipeline waiver package.The suit was filed in the U.S. Court of Appeals here by Sen. Howard Metzenbaum, D-Ohio, who led the Senate opposition to the waiver package passed by Congress last fall. At the time, Metzenbaum threatened legal action.The suit claims the waiver package was enacted under flawed procedures and will require natural gas consumers in 36 states to guarantee payment of $32 billion in costs of building the project.The waivers include the North Slope gas conditioning plant in the project, streamlining regulatory procedures and allowing consumers to be billed before gas starts to flow.Anchorage TimesJan. 25, 1982Oil companies shell out $61 million for leasesBy Bruce BartleyThe Associated PressFairbanks -- Oil companies offered more than $61 million Wednesday for federal oil and gas leases on about 762,000 acres in the National Petroleum Reserve-Alaska.While oil company executives were generally pleased with the results of the largest onshore federal lease sale in history, federal officials said they were disappointed it didn’t generate more money.Alaska and the federal government will divide equally the bonus money offered Wednesday, as well as annual rental fees of $3 per acre on the 10-year leases.The oil companies also may pay royalties equal to one-sixth of any oil and gas produced from leased lands. That money also will be split 50-50 between the federal government.It was the first lease sale ever in the 23-million-acre reserve on the North Slope, just west of the producing Prudhoe and Kuparuk oil fields.10 years ago this weekAlaska Journal of CommerceFeb. 3, 1992Oil field technology pushes limitBy Ray TysonAlaska Journal of CommerceARCO Alaska Inc. believes more barrels of crude oil can be squeezed out of the Prudhoe Bay reservoir during its lifetime but says the means to recover billions more above current estimates doesn’t exist."We don’t mean to trivialize it, but at the same time we want to make the point that we don’t see a breakthrough in technology," said Jerry Pollock, ARCO’s manager of engineering of Prudhoe Bay.Technology and ingenuity have boosted Prudhoe Bay’s estimated recoverable reserves from 9.6 billion barrels to about 12 billion barrels, leaving a remaining target of roughly 10 billion barrels.To help reach the 12 billion barrel mark, Exxon and co-field operators ARCO and BP Exploration plan to invest at least another $2 billion to $2.5 billion in America’s largest oil field.Alaska Journal of CommerceFeb. 3, 1992Sawmill waste becomes roofing for pricey homesBy Lew BreseeWrangell SentinelWrangell -- Frank Age has built a business utilizing a product that would otherwise go to waste.Age produces roofing products from culled cedar that normally is discarded by lumber firms. He previously manufactured the product in his native Oregon, but he came to Wrangell last April, after logging started to hit a decline in his home state.The move to Wrangell was first contemplated by Age and his wife, Debbie, in October 1990. He said he flew up to see if there would be a large enough supply of cedar to manufacture his product. He found about 15 to 20 years’ worth of unused culled cedar.Age’s Cedar Products produces shakes, or roofing shingles, from red cedar. Since the shakes are relatively small, Age can get a quality product by selectively cutting the short pieces of cedar.-- Compiled by Ed Bennett.

Chignik salmon co-op 'a courageous step'

Alaska’s salmon industry crossed a threshold Jan. 14 when the state Board of Fisheries authorized Chignik fishermen to form a cooperative, which would allow a few boats to fish and share harvest revenues with co-op members opting not to fish.The result will be an unusual system where fishermen could collect checks for not fishing."Change is difficult, and it’s a courageous step for fishermen and the state fisheries board in trying something to save the endangered salmon fishery," said University of Alaska fisheries economist Gunnar Knapp.There are possible legal problems, but the fisheries board decided to try the cooperative approach anyway.The board voted to allow 100 fishermen who hold permits to fish in Chignik to form a cooperative, with a majority, or 51 permit holders, required to join if a co-op is formed.If the co-op is formed, the fishery would be split into two parts. A percentage of the allowable harvest would be allocated to the cooperative boats and a period set for them to fish.A portion of the harvest, and a time period to fish, would also be reserved for those who opted not to join the co-op, who would fish in the traditional manner, racing to catch as many salmon as possible in the time allowed for them to fish.The plan has the advantage of reducing the number of boats in the fishery, cutting costs because only a few boats would operate, Knapp said. For example, six or seven boats might harvest the same number of salmon over a longer period than were caught previously by more than 50 boats in the competitive open fishery.More salmon are thus caught with lower costs, which addresses a key problem facing Alaska’s salmon industry. Competition from farmed salmon has lowered the prices Alaska fishermen receive. But the costs of fishing in Alaska have remained high partly because of the way the fishery operates, with many small boats competing against each other for fish during short harvest openings.There are still major policy problems to be addressed by the Board of Fisheries if the Chignik co-op experiment proceeds, Knapp warns.One is how to limit fishermen who opt not to fish in Chignik from fishing in other areas.Another is to address the potential of stacking of harvest shares, where one person might buy up allocation shares from others, as has happened with halibut and sablefish individual fishing quotas, he said.The experiment also raises fundamental social questions and issues."It raises questions of self-identity," Knapp said. "There is a lot of pride and self-respect that comes when someone identifies with what they do. When that changes, when someone becomes essentially a coupon-clipper rather than an active fishermen, it’s an important threshold," he said."Any change is painful," but changes like this may be needed to save the industry, Knapp said.Another long-range question is that if groups of fishermen are allowed to receive revenues without fishing, there’s less reason for them to continue living in coastal communities near fishing areas.While many fishermen today live far from where they fish, in Anchorage or Seattle, the plan could eventually encourage people to move away from coastal communities, Knapp said.State fisheries managers have said that while the co-op approach may work in Chignik, which is a distinct salmon run with only 100 fishermen, it may not be appropriate for larger salmon fisheries like Bristol Bay, where there are complex, mixed salmon runs and more than 1,000 fishermen.The co-op concept echoes a somewhat similar plan now in effect in offshore, federally managed waters. The American Fisheries Act, passed by Congress, allowed vessel operators and processors to form cooperatives as a way of reducing capacity in the fishery.There are important differences between the federal and state actions, however. The federal law allows processors to form cooperatives with fishing vessel owners, where the state action applies only to fishermen.The federal law also provided for a buy-out of some large catcher-processor vessels, to reduce the fleet. No buy-out is proposed, at least for now, in the salmon fishery.

Missile Defense System contract expected in April

FAIRBANKS -- The Department of Defense may spend up to $250 million on missile defense work in Alaska during the next two years, according to information released by the U.S. Army Corps of Engineers.The agency expects a prime contractor for the job will be selected by April 12. The Corps estimates the work to be worth between $100 million and $250 million.The project is expected to be a boost for the Fairbanks area. The project likely will produce 500 to 1,000 jobs, said Dick Cattanach, executive director of the Anchorage-based Associated General Contractors of Alaska.The money will come from the $7.8 billion Congress approved for missile defense work during this fiscal year. President Bush signed that expenditure into law Jan. 10.Defense officials have said they want to build about five silos at Fort Greely to house interceptor missiles."The government is going to be looking at getting a contractor that has done work like this, of this magnitude. There’s only a half-dozen companies in the world" who would likely qualify, Cattanach said.Alaska companies are expected to serve as subcontractors, he said.

Knowles upbeat about economy, seeks tax, a fiscal plan

In his final State of the State address to the state Legislature, Gov. Tony Knowles challenged lawmakers to solve key problems facing Alaska, including development of a long-range fiscal plan and passage of an amendment to protect subsistence rights of Alaskans.The Democratic governor was upbeat about prospects for the state’s economy, citing an increase in oil production, new exploration activity and work on a major natural gas pipeline. He noted challenges, however, facing the state’s fishing, tourism and forest products industries.To make a step toward covering a looming fiscal gap, Knowles proposed reintroduction of a state personal income tax, an increase in state alcohol taxes and imposition of a new state tax on cruise tourists.The top priority should be to ensure a growing private economy, Knowles said."We know the best social program is a job and only a growing private sector economy can provide the resources to invest in education, children and safety," he said."While other states are reeling from high unemployment and recession, Alaska’s economy is moving forward. We can stay on track by continuing a pro-business environment, encouraging investment, building transportation and providing essential services."Citing examples, the governor said North Slope oil production will increase this year "for the first time in a decade, due to production from Northstar and new discoveries. Activity in the NPR-A and 16 scheduled state area-wide lease sales will keep exploration and new production growing."Knowles also cited ANWR’s oil potential and the prospect of a large natural gas project as reasons for optimism."There’s no other place in America with the huge quantities of oil our national economy needs than beneath a small portion of the Arctic National Wildlife Refuge," he said."Development of our enormous North Slope natural gas resources is at the top of every national energy plan. Now the question of building an Alaska gas line is not if, but when."However, the governor cited challenges facing the state’s tourism industry because of the terrorist attacks last September and the national economic downturn, and the continued challenge of farmed salmon to the state’s fishing industry.A major concern is the looming state fiscal gap, but the governor defended proposed increases in spending despite a larger deficit."Some have asked if it is responsible to increase the budget when lower oil prices have produced a billion-dollar budget gap," Knowles said."First, let me remind you that $81 million of this increase is a direct result of actions you have taken in approving laws, budgets, contracts and replacing lost federal and other funding sources," he said. He said the rest of the increase, mostly for education-related expenses, was a top priority for him and for most Alaskans.On the fiscal gap, Knowles said, "I have proposed solutions to these issues seven years in a row, in every regular legislative session and I have called special sessions."Across political party lines, individual legislators have worked hard to make progress. For 20 years, Alaska governors, legislators, economists, business and civic leaders have all urged long-range budget plans recommending the same basic combination of cuts and revenues to replace dwindling oil dollars. Now the day of reckoning is upon us."A solution to the fiscal gap should have five elements, Knowles said."One, any plan must be fair. Everyone should contribute, including those who make money here but live elsewhere. Two, Permanent Fund earnings, after inflation-proofing and dividends and a vote of the people, should be used only after a broad-based tax and corporate taxes are in place.""Three, new revenues should be phased in rather than imposed all at once. This avoids shocking the economy and helps families and businesses adjust to the change. Four, any budget plan must be realistic, not based on unsubstantiated estimates or bogus promises."Five, efficiencies, savings and continued cost reductions must always be part of budget considerations."The math of the challenge before us is pretty simple. We must average approximately $1.2 billion a year in new revenues to balance our budget though the end of this decade."Knowles proposed that the solution be phased in over three years, implementing additional measures each year to generate about $400 million dollars each year.This year, the governor proposes to raise $350 million dollars from resumption of "a modest state income tax, which is less than half the rate Alaskans paid under our old income tax. Second, $30 million from the first alcohol tax increase in 19 years; and third, $20 million would come from a passenger fee on the cruise ships that pay no state tax."Knowles defended the income tax."I believe the most fair, broad-based tax is an income tax based on the percentage of federal income tax paid. People who work in Alaska but live elsewhere would contribute about $23 million of the bill. The federal government would pay about $52 million through federal tax deductions Alaskans would get on their state income taxes."That means to generate $350 million in taxes, Alaskans would pay about $275 million." Those figures were based on Alaskans paying 18 percent of their federal tax to the state.He also spoke strongly in favor of a higher alcohol tax."The state tax on alcohol was last raised in 1983. Asking those who consume alcohol to contribute an extra dime a drink will raise $30 million. This is small compared to the cost each year of treating the problems of alcohol abuse, estimated at $453 million a year."The most surprising element of the governor’s plan is the cruise passenger tax, but he defended it strongly: "Today, the multibillion dollar cruise ship industry pays no corporate income tax to Alaska on its cruise ship operations, or for that matter, to the federal government or any other state in America."It is only fair that every industry contribute something to Alaska for the many benefits they receive here. A tax of $30 per passenger would raise about $20 million for the state."The governor declined to make proposals for future years, leaving that to a new governor and Legislature."There are sufficient tools available to fill the remaining gap before the reserves are totally exhausted," he said.He also reserved judgment on an increase in petroleum taxes."This may be a potential source of revenue in future years, but any change must be carefully considered as they currently pay about 80 percent of the state budget in taxes and royalties," Knowles said."Private investment in future oil and gas development depends on fiscal stability and global competitiveness. Tax rates should be changed only if they meet those criteria or we will kill the goose that has laid the golden egg."Each year in this balanced budget plan requires heavy lifting and the first may well be the most difficult. Yet the do-nothing approach is a blueprint for future economic disaster," Knowles said."Doing nothing when reserves are exhausted means drastically and irresponsibly cutting basic services and liquidating state assets, including permanent fund earnings, at a frightening clip."

APU, Alaska Regional offer women's ski, fitness workshop

Alaska Regional Hospital and Alaska Pacific University will sponsor the Women’s Ski and Fitness Symposium on Jan. 26. The event precedes the annual 2.4-mile Alaska Ski for Women event Feb. 3.The skiing portion of the symposium will run from 10 a.m. to noon at Kincaid Park. Participants can learn ski techniques while touring the Ski for Women course with skiers from APU’s Gold 2002 women’s team.During indoor sessions, guest speakers will address health and fitness topics from 2-4 p.m. at APU’s Atwood Center. Dr. Tina Tomsen will discuss coordinating a busy schedule and fitness activities. Young Fisher, a registered dietitian from Alaska Regional, will discuss nutrition for athletes. Dr. Tom Vasileff, an orthopedic surgeon, will present measures for preventing and healing sports injuries. Ann MacInnes Mize, APU Gold 2002 women’s team coach and Ski for Women co-founder, will speak on developing a ski fitness plan.Cost for the symposium is a donation to the Abused Women’s Aid in Crisis shelter. The Ski for Women also benefits AWAIC. For more information, visit the Web site (www.alaskaskiforwomen.org) or call the Nordic Ski Club hotline at 907-248-6667.Patient Care Alliance sponsors meeting on weight, billing issuesPatient Care Alliance plans to conduct a free public meeting on dealing with weight issues and related medical bills at 7 p.m. Jan. 24 at First American Baptist Church, 1200 E. 27th Ave., in Anchorage.Speakers will discuss the topic and the related options for medical testing, health care professionals and insurance payment.For more information contact Lorrie Saunders, executive director of the Patient Care Alliance, via e-mail ([email protected]) or call Noni Bordwell at 907-745-4378.Mat-Su breast cancer support group plans February meetingThe Mat-Su Breast Cancer Support Group has scheduled a meeting for Feb. 12. The event runs from 7-9 p.m. at Valley Hospital Medical Campus, Classroom C in Wasilla.Dr. Susan Lemagie will discuss hormone replacement therapy following breast cancer.For more information, call 907-376-8689.

Land offered for logistics

City land is being offered for sale near the Ted Stevens Anchorage International Airport with the hope that the parcel will be developed into an aviation-related global logistics center or industrial park.The 9.3-acre parcel, valued at $1.65 million, is south of International Airport Road, between Minnesota Boulevard and Minnesota Drive, near the Chugach Electric Association headquarters.It is the nearest undeveloped and available parcel of its size close to the airport, according to George Cannelos, director of the city’s real estate department.Cannelos said investors have been interested in building aviation-related facilities near Anchorage International, but they’ve been unable to find an appropriate piece of land."They want to take advantage of Alaska’s strategic position, but there is a lack of available land for development,’’ Cannelos said.The city began advertising the land in early January and will take bids until Feb. 1.All proposals must be for the development of an aviation-related industrial park, or what the city is calling a global logistics center. The facility should have at least 80,000 square feet of warehouse or light-manufacturing space, according to the city’s request for proposals.Ideally, the facility will somehow incorporate Port of Anchorage and Alaska Railroad Corp. operations, the city’s advertisement said.Proposals will be graded by a committee of city officials and business leaders, Cannelos said. Points will be awarded based on a company’s experience, financial capability, and development and marketing plans, Cannelos said.A $500,000 performance bond will be required to ensure the land is developed for its intended purpose, Cannelos said.

Stevens intends to keep federal spigot open

Alaska Republican Sen. Ted Stevens fully intends to keep the federal dollars flowing to Alaska in 2002. As ranking minority member -- and former chairman -- of the Senate Appropriations Committee, he has become legendary in his ability to fund Alaska projects."Defense spending in Alaska was about $1 billion last year," Stevens told the Journal in a telephone interview. "It should be about the same this year."In addition to operating Alaska’s military bases, those funds include about $300 million per year in construction projects funneled through the U.S. Army Corps of Engineers. The biggest construction project in Alaska for 2002, the $215 million replacement for Bassett Army Hospital at Fort Wainwright, is one of dozens funded via the Corps.This year, Stevens said he will try to put funding for a causeway to Fire Island in the Corps budget. The island, just offshore from Stevens’ namesake airport in Anchorage, has been eyed as the site of a possible cargo-only airport in the past.Stevens said Alaska has been getting about $350 million per year for highway construction, and he’s looking to increase that amount. The act, which authorizes federal spending on highways, is being rewritten this year, and Stevens sees this as a unique opportunity for Alaska.The reason: Alaska Republican Rep. Don Young is chairman of the House Transportation and Infrastructure Committee, the lead committee on the highway funding bill."This is a big year for Don Young," Stevens said.While highway funding is not handled on the Senate side in Stevens’ committee -- it goes to the Public Works Committee -- Stevens was confident he could influence the Senate version of the bill."Don (Young) and I have a good synergy going between our committees on transportation projects," Stevens said.What does Stevens want included in the highway bill? Bridges. As many bridges as he can get, including the Knik Arm Crossing, a bridge to the Ketchikan Airport on Gravina Island, and a new bridge linking Juneau and Douglas Island."How many we’ll get, we don’t know," Stevens said.Stevens said he plans to continue providing the Alaska Railroad with $50 million per year to keep straightening its track.He will also push for continued funding of the Denali Commission, which saw its budget increase to $96 million last year from $65 million in 2000. The commission has been funding a series of targeted projects in rural Alaska, including building health clinics, replacing leaking fuel tanks, and installing water and sewer systems in villages."We’re 60 percent there" in eliminating honey buckets, Stevens said.The commission also has funding to train rural residents to build its Bush projects."The No. 1 problem we’re trying to tackle is unemployment," Stevens said. "These construction projects help that."Another rural priority for the senator is installing landing lights at every village runway. He said he got $11 million for the project last year and is aiming for $17 million this year to finish it.Stevens plans to again tackle the thorny issue of bypass mail, a program that subsidizes mail shipments to the Bush and is designed to encourage air carriers to serve small villages. However, the U.S. Postal Service is losing more than $100 million a year to run the program, and Stevens said it must be streamlined for it to survive."The Postal Service demanded we revamp it or it would ask Congress to abandon it," Stevens said.Stevens said bypass mail and a second subsidy program, Essential Air Service, are vital to Alaska’s smaller communities."If that system collapses, the rural economy would collapse," Stevens said. "And it would have a large impact on Anchorage suppliers."Stevens sounded guardedly optimistic about the prospect of opening the Arctic National Wildlife Refuge to exploratory drilling for oil. The Republican-controlled House approved the measure last year, but it faces tougher sledding in the Democrat-controlled Senate.Stevens said opening ANWR is still included in the energy bill."We have the votes to pass it, but not the votes to override a filibuster," Stevens said. A filibuster is a delaying tactic Democrats have promised to use to block ANWR drilling; it requires 60 votes to stop it.Stevens said the terrorist attacks of Sept. 11 have helped the prospects for passage of the ANWR provision."Since Sept. 11, there’s been a total swing around in public opinion in every poll I’ve seen, except those controlled by the major environmental organizations," Stevens said. "They show the public supporting ANWR. People are starting to wonder how stable are our energy supplies."Stevens said that if an ANWR drilling provision is passed, it would be litigated for years. He said a natural gas pipeline from the North Slope faces far less opposition. He said he’s working on a provision in the tax laws that would encourage construction of such a pipeline.The plan would allow the owners of a gas pipeline to pay reduced taxes in years when gas prices are low, and then pay the government back later, when prices are higher."We’re working on a formula now," Stevens said.The other big project in the wings is a National Missile Defense System. The decision by President Bush to pull the nation out of the 1972 Anti-Ballistic Missile Treaty clears the way for further testing of the system this year, with construction of facilities to launch five missiles at Fort Greely and using the launch pad at Kodiak for other tests. Stevens said all necessary funds for those projects have been appropriated and can be spent immediately.Stevens said an X-band radar site at Shemya Island in the Aleutians is still part of the planned system. An aide to the senator said the radar won’t be built until the operational version of the system is deployed, in 2005 to 2006. At that time, the facility at Fort Greely would be expanded to accommodate 100 missiles, under current plans.The aide said a radar site in Hawaii is under consideration for a naval version of the missile defense system, but is not currently in the budget.Stevens is also continuing to keep an eye on the fishing industry in Alaska. He’s clearly annoyed at the Agriculture Department’s decision to prohibit Alaskans from labeling their fish as organic."The farm bill has not passed," Stevens said. "We may have to do it by law."

State backs $190 million Ketchikan crossing

KETCHIKAN -- The state is recommending two bridges touching on Pennock Island as the best way to improve access to Gravina Island, where Ketchikan’s airport sits. The project could cost $190 million, officials say.Currently, travelers between Ketchikan and its airport take a shuttle ferry.Transportation and Public Facilities Commissioner Joe Perkins said the selection is a significant step toward turning the proposed bridge into a reality. He and Gov. Tony Knowles announced the decision Jan. 7.The Alaska congressional delegation has obtained $20 million in federal money to start the project, Knowles said. The state’s match is 20 percent. If the delegation succeeds in securing the full cost, the crossing could be the biggest construction project in Southeast Alaska in a decade, Knowles said.The proposal calls for a low bridge to cross the east channel of Tongass Narrows from Revillagigedo Island to Pennock Island. Continuing west, the roadway would gain elevation as it traversed Pennock, then cross the west channel of Tongass Narrows to Gravina on a second bridge more than 200 feet tall.State officials said the Pennock alternative was chosen, in part, because it allows the passage of major cruise ships; has less impact on floatplane traffic and Ketchikan International Airport; and is less visibly intrusive than some of the seven other options studied.The Pennock decision isn’t final. The announcement starts a 60-day public comment process, after which the state will make its final recommendation.

Canadians forge ahead with Mackenzie pipeline project

WHITEHORSE, Yukon Territory -- Canadian natural gas producers say a decision to go forward with the Mackenzie Valley pipeline project does not close the door on a future partnership with Alaska producers of natural gas.The decision to advance the $3 billion Mackenzie project is based on an economic feasibility study of the 6 trillion cubic feet of natural gas reserves in the Mackenzie Delta."Not at any time did we contemplate Alaska gas," said Hart Searle, a spokesman for Imperial Oil.The partnership of Mackenzie Delta gas producers and the Mackenzie Valley Aboriginal Pipeline Corp. announced Jan. 8 it would spend millions during the next year to prepare the project for regulatory application."Certainly, I think it is safe to say that an application will go in in 2003," Searle said. "The application work will take us through this year and some time into 2003, and we would be in a position to file in 2003."The Alaska producers of North Slope gas are currently crunching the results of a $100 million research effort carried out during the last year. The producers are looking at the feasibility of two routes to pipe their product to the lower 48 states.One option is to build a natural gas pipeline from Prudhoe Bay to Fairbanks, and then follow the Alaska Highway corridor south to central Alberta. The second option, the over-the-top route, is to lay an offshore pipeline across the Beaufort Sea from Prudhoe Bay to the Mackenzie Delta, then go south down the Mackenzie Valley to northern Alberta.Searle said if the Alaska producers indicated an interest in working together with the Mackenzie Valley project, the Mackenzie Delta producers would be open to the idea.However, Searle said there’s nothing to suggest that the Mackenzie project couldn’t go forward on its own.Greg Komaromi, the Yukon’s director of oil and gas, said the announcement by the Mackenzie Valley consortium killed any chance of the Alaska producers going over-the-top with their pipeline.Komaromi said that while the Mackenzie group is talking about a pipeline to move 800,000 to 1 billion cubic feet of gas per day, the Alaska producers are talking about a pipeline with a capacity more than four times that amount."I think it is good news for the Alaska Highway route, in the sense that we have always envisioned these two projects going hand-in-hand," said Bob King, Alaska Gov. Tony Knowles’ spokesman. "There is certainly enough demand in the U.S. and Canada for both projects."Curtis Thayer, spokesman for the Alaska producers, said ExxonMobil Production Co., BP Exploration (Alaska) Inc., and Phillips Alaska Inc. are still expected to make an announcement on their findings before the end of March.He said from the beginning the Alaska producers were focused on the north-south pipeline project based solely on the 35 trillion cubic feet of known gas reserves on Alaska’s North Slope.

Office space needs likely to wane

The Anchorage commercial real estate market in 2002 may see a need for warehouse space while demand for office space could slow, according to a panel of industry officials. Construction to be completed later this year will add 120,000 square feet of office space, said Chad Frampton, partner and broker at Schwamm & Frampton LLC of Anchorage. The economic outlook for Anchorage could see some job growth this year, said Scott Goldsmith, director of the University of Alaska Anchorage Institute for Social and Economic Research. However, he cautioned that a main economic engine, federal funding, won’t continue forever. Alaska ranks first in the nation for per capita federal dollars, he said. Also, a state fiscal gap could knock the air out of the economy, Goldsmith said. "In the near term the future looks bright but be prepared for a bumpier ride somewhere down the track," he said. Speakers addressed these topics Jan. 11 during the Building Owners and Managers Association of Anchorage commercial real estate forecast meeting at the Millennium Anchorage Hotel. In the office space sector, 2001 posted strong results with declining vacancies and climbing rental rates, Frampton said. However, he believes this year may herald slackening demand as the economy slows and new office space comes online. "I think 2002 will be slow and steady compared to the last couple years," Frampton said. More office construction probably won’t occur until current new space is absorbed by the market, he said. The Class A vacancy rate is 2 percent, and 4 percent for Class B and C office space for a total of vacant 300,000 square feet, he said. Rental rates for new Class A office space range from $2.65 to $3.25 per square foot each month. Rates for existing Class A space are $2 to $2.50. The range for Class B office space is $1.45 to $1.85 and for Class C, $1.10 to $1.40. Large blocks of Class A office space are limited, he said. Office space is scarce in the university/medical district despite new offices at Lake Otis Medical Center primarily for HealthSouth, he said. Providence Alaska Medical Center’s emergency room renovations completed last year also included adding 40,000 square feet of office space, although most of that is already leased, he said. Alaska Regional Hospital has office space available in its 28,000-square-foot Building C, Frampton said. In South Anchorage, the district’s largest office complex, Dimond Center, has 11,000 square feet of vacant space from the former Walden Pond School. Also, Arctic Slope Regional Corp. plans to sell its South Anchorage offices and move to its Midtown headquarters later this year, he said. ASRC will be the primary tenant for the new 10-story, 200,000-square-foot building, although 40,000 square feet on the top two floors will be available for lease, he said. A new office building at 3000 C St. should soon be completed, adding another 80,000 square feet to the office market, he noted. One proposed project, the three-story Sanders office complex at 36th Avenue and Denali Street, may add 45,000 square feet. Such additional office space might outpace demand this year, Frampton said. Class A office space is tight downtown, and converting older buildings to office space has helped the market, he said. A new Class A office building is under construction in Wasilla, he noted. The 43,000-square-foot, three-story Centennial Plaza is about 40 percent leased, Frampton said. Vacancy rates for warehouse space in Anchorage were 5.9 percent in late December out of an inventory of 13.8 million square feet, according to the Multiple Listing Service. "Most of the space offered for lease is vacant, but very little of the space offered for sale is vacant," said Doug Taylor, a broker from Prudential Jack White Real Estate. Last year new industrial space construction totaled $11.8 million, compared with $6.4 million in 2000, Taylor said, citing building permit statistics. Based on the Anchorage Economic Development Corp.’s forecast for 1.4 percent job growth, "we need to build about 193,000 square feet of new industrial space in 2002 to maintain our current market balance," he said. Anchorage should see several new construction projects this year, said Larry Cash, president of RIM Architects. "It is my belief that we’re going to see a continued good year for new construction. We may see less vertical construction and quite a bit more revitalization," he said, citing possible renovations at University Center. The ASRC building should be ready for tenants in September. Also in Midtown Anchorage, construction is under way on the BP Energy Center near BP Exploration (Alaska) Inc.’s headquarters. Cash said retail construction includes Fred Meyer in South Anchorage and possibly Eagle River, Home Depot in East Anchorage, Lowe’s Home Improvement in South Anchorage and renovations at Carrs Quality Center in Eagle River. Several hotel and restaurant projects also are under way. Municipal projects should include expanding the Anchorage Museum of History and Art, the city’s permit center and the Anchorage Senior Center. Also, the University of Alaska Anchorage library expansion should go out to bid this spring. Work on the three-story project should be finished in 2004 and add 126,000 square feet to the 87,000-square-foot building, Cash said. This year Anchorage will continue to add retail space to an already "overstored" market, said Bill Gee, vice president and broker at Hickel Investment Co. The excess of retail space parallels a national trend, he said. Anchorage’s 6 million square feet of retail space needs a population of 402,000 to support it, Gee said. Even including residents of the Kenai Peninsula and the Matanuska-Susitna areas, Southcentral’s population totals 370,000, he said, and that’s not counting about 1 million square feet of retail space in those areas. Retail space opening this year will affect the market and other retailers, he said.  

AEDC looks to recruit private clients for logistics center

An Anchorage economic development agency is pursuing plans to create a global logistics center in the area, including military operations.Larry Crawford, Anchorage Economic Development Corp. president and chief executive, said the key to developing a global logistics center lies in working with private companies, especially those providing value-added services.Last summer AEDC started a marketing effort to pitch Anchorage as a warehouse and distribution center for critical military parts and equipment.The move followed a study analyzing the idea. AEDC commissioned Price Waterhouse to conduct the study, which was completed last spring. The study identified 100 major defense contractors that supply or maintain equipment for the armed services, AEDC officials said earlier this year.Findings from the study dictated AEDC’s subsequent move, Crawford said."In order for us to attract military (logistics operations) we need to have a solid commercial structure on which they can piggyback," he said.Crawford spoke Jan. 9 at AEDC’s annual economic forecast luncheon at the Egan Civic & Convention Center.AEDC also is working with officials from Ted Stevens Anchorage International Airport on the project, he said.AEDC has a contract with German-based TransCare to define methods of attracting firms to Anchorage, Crawford said. The contract was funded by a $150,000 state grant, he said.TransCare’s findings should be finished in late January, he said.Part of its work includes meeting with clients of a logistics company to pinpoint what could attract them to Alaska, he said.Some of companies include Intel, Motorola, Lockheed Martin, 3M, Honeywell, Siemens and General Electric, he cited."We met with over 20 U.S. and European companies," Crawford said.Once the report is complete, AEDC officials will assess possible options and develop a similar strategy for the Asian market, he said.AEDC’s goal is to attract a company that will manufacture a product to serve as payload for air carriers, he said.

Salmon industry needs a shake-up

Most people now recognize that it’s going to take more than a sustained marketing blitz to revitalize Alaska’s salmon industry."Challenges and Strategies for the Alaska Salmon Industry," a paper by Gunnar Knapp, is providing a sort of road map for a long-term fix, and is sure to shake things up as the Alaska Legislature settles in this month for a rocky session. Knapp is a University of Alaska economist and longtime industry watcher and prognosticator."The basic problem we face in the Alaska salmon industry is that our management system is not designed to create a competitive and cost-efficient industry," he writes. "Instead it is designed to achieve social and political goals of spreading the wealth of the salmon fishery -- of maximizing jobs and incomes for Alaskans. For a period of time, the system worked well. But it isn’t working well any more."Knapp says that a big part of the problem is that decades ago, the government decided that salmon could only be caught by a few specific gear types and established how many boats would fish each type of gear in each area."We are locked into harvesting Alaska salmon almost exactly the same way we did decades ago. We have hardly changed at all, while the rest of the world’s salmon industry -- and indeed the entire global economy -- has been engaged in continuous change in an effort to lower costs, improve quality, and better meet the needs of changing markets."He adds: "Much of the Alaska commercial salmon industry simply looks stupid and irrational to other Alaskans and other Americans. They no longer perceive the salmon industry as valuable and important. We seem to be in a perpetual crisis. We keep having ’economic disasters,’ and we seem to be always asking for help."Ouch.Pay up timeAlaska halibut and blackcod fishermen will pay slightly more this year for the privilege of participating in their exclusive fisheries.In a letter sent to Individual Fishing Quota permit holders, fishery managers announced the "cost recovery" fee will be 2 percent of the dockside value of last year’s catches, an increase of 0.2 percent. The letter was accompanied by bills based on the prices harvesters received for their catches. By law, federal fish managers can collect up to 3 percent of the value of the fisheries.The money is used to cover management and enforcement costs of the halibut and blackcod fisheries during the eight-month-long season that runs each year from March 15 to Nov. 15. Some of the money is also used to fund a low-interest loan program for fishermen interested in buying into the IFQ fisheries.Fishery managers said the rate hike came about because of a decline in the value of the catch. The total value for both species in 2001 is estimated at $167 million, down roughly $30 million from the 2000 catch.Last year was the first time fees were collected by the National Marine Fisheries Service for managing the fisheries. By all accounts, the process went smoothly. Of the more than 2,500 people who received a bill, only nine had to be referred to the U.S. Treasury Department for collection.Payments are due by Jan. 31.Have some say in subsistenceThe feds are seeking 33 people to serve on Alaska’s 10 Regional Subsistence Advisory Councils. The councils make recommendations to the Federal Subsistence Board and play a vital role in developing subsistence regulations and policies."The regional councils carry a great deal of weight in decisions regarding subsistence," said Mitch Demientieff, chairman of the Federal Subsistence Board.Council members represent the geographic, cultural and user diversity from within their region. The councils meet at least twice a year to consider proposed regulations for subsistence hunting and fishing. Councils also make recommendations on federal fishery studies and are responsible for reporting back to communities on subsistence issues. Most of the seats to be filled are for full, three-year terms, and members appointed in 2002 will join the councils this fall.The application period ends Feb. 22. Contact the Office of Subsistence Management at 800-478-1456 for more information.Wanted: money applicantsThe National Park Service is having a tough time getting fishermen to apply for millions of dollars in compensation funds. The money, which totals $23 million, is for those who were squeezed out of Glacier Bay fisheries in Southeast. Although an estimated 200 to 400 people are eligible to receive money, only about two dozen had applied by year’s end.The compensation package is divided among fishermen/crew, processors and employees, support businesses and communities. The deadline to apply is Jan. 28. Contact the Park Service or Department of Fish and Game to apply.Kodiak-based free-lance writer Laine Welch can be reached via e-mail at ([email protected]).

Exploration points True North to north

FAIRBANKS -- Fairbanks Gold Mining officials want to expand gold mine operations at the True North deposit after receiving favorable results from an aggressive exploration program last year.Three ore deposits north of True North’s current mining pit have enough reserves to extend the life of the mine at least another year."The mine life is extended from 2003 to 2004, which is good news for employees," said Tom Irwin, vice president of Fairbanks Gold Mining, the company that operates True North. The mine, 30 miles north of Fairbanks, employs 100 people.Fairbanks Gold spent $2.1 million on a drilling and exploration program at True North, Irwin said.The company moves 10,000 tons of True North ore daily to its Fort Knox processing mill 10 miles east of True North and to do so moves about 20,000 tons of development or waste rock, a 2:1 strip ratio, Irwin said.The new ore bodies will have higher concentrations of development rock with a strip ratio of 4.2:1, meaning that for every 10,000 tons of ore obtained, the company will have to move 42,000 tons of development rock.Irwin said the company has not completely analyzed how many more ounces of gold reserves the new discoveries will add.Fairbanks Gold has applied to the Department of Natural Resources and the U.S. Army Corps of Engineers for permit revisions so it can expand True North’s operation, Irwin said. The new pits fall within the mine’s current mill site lease area.Ed Fogels, large mine project manager with the state Division of Mining, Land and Water, said he is still reading the application. He anticipates public hearings and possibly a public meeting to discuss the expansion.The company wants to begin work on the expansion this summer, Fogels said.One concern is whether the mineral makeup of the new ore discovery will be compatible with current extraction methods at the Fort Knox mill. Fairbanks Gold uses a mix of chemicals to extract microscopic gold from crushed hard rock."After looking at the chemistry we want to make sure this stuff is OK to put in the mill," Fogels said.

Alaska Airlines to premiere service to Denver, Boston this spring

Alaska Airlines in April will expand service to Boston and Denver, which the company hopes will fill seats on the company’s expanded fleet of long-range, fuel-efficient aircraft.Beginning April 28, the Seattle-based airline will fly once a day from Fairbanks to Anchorage and continue on to Seattle and Denver. The airline will have two more flights daily between Seattle and Denver.Jack Walsh, an Alaska Airlines spokesman in Seattle, said Denver is a prime destination for people from Alaska and the Pacific Northwest."It’s the No. 4 market for travel from Seattle," Walsh said. "There is a tremendous amount of traffic every day between Seattle and Denver and vice versa. It made good sense for us."Horizon Air, the company’s commuter airline, will fly two nonstops daily from Denver to Portland, Ore., and a third to Portland with a stop in Boise, Idaho.The flights to Denver will be served by 138-seat Boeing 737s; Horizon’s flights will be aboard its new 70-passenger Bombardier CRJ 700 jets.Also on April 28, Alaska Airlines will offer service from Seattle to Boston, using new long-range 120-seat Boeing 737-700s. Walsh said the airplanes are fuel efficient and have enabled the airline’s recent entry into the Chicago and Cancun, Mexico, markets.The airline also is using the Boeing 737-700s to serve Washington, D.C., from Seattle, at Reagan Washington National Airport and Dulles International Airport.

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