Felony cannabis cases scheduled for trial in early 2016

The State of Alaska is charging four individuals with multiple felonies after each of their cannabis operations fell to Anchorage Police Department undercover work and ensuing raids. Trials won’t be held until January and pretrial hearings will be held in November and December. Rocky Burns, Larry Stamper, Michael Crites, and Charlene Egbe are each alleged by the state to have been operating illicit marijuana businesses in 2015, and were indicted in September. Burns and Stamper co-owned and operated Discreet Deliveries, a delivery service with operations in Fairbanks, the Mat-Su, Anchorage, and the Kenai Peninsula; both men were charged with seven felonies and one misdemeanor. Michael Crites operated Absolutely Chronic Delivery Co. and was charged with five felonies and one misdemeanor. Charlene Egbe, who operated Alaska Cannabis Club, was charged with four felonies and four misdemeanors. All defendants were released of their own recognizance on the sole condition they not sell any marijuana. Crites, Burns, and Stamper have stayed in Alaska, while Egbe has spent time in the Lower 48 on various speaking engagements for cannabis industry media outlets and publicity events. Anchorage defense attorney Keri Brady, who served as Anchorage district attorney from 1997 to 2007, represents Egbe, who uses the name Charlo Greene in public relations. Egbe is scheduled for a pretrial conference with Anchorage Superior Court Judge William Carey on Nov. 18 and trial Jan. 4, 2016. The Public Defender Agency will represent Crites. He is scheduled for a Nov. 23 pretrial conference with Anchorage Superior Court Judge Kevin Saxby and a trial Jan. 11, 2016. Cannabis industry business attorney Jana Weltzin represents Burns, while Anchorage criminal defense attorney Gregory Heritage represents Stamper. Both men are scheduled for a Dec. 8 pretrial conference with Anchorage Superior Court Judge Jack Smith and a trial Jan. 11, 2016. Money matters Lisa Kelley is prosecuting all four defendants. Kelley works from the Office of Special Prosecutions of the Anchorage division of the Alaska Department of Law. John Skidmore, director of the Anchorage Criminal Division of the Alaska Department of Law, said the State of Alaska chose Kelley as prosecutor because the matter is largely about revenue. “Kelley is assigned to cases that are about revenue fraud,” said Skidmore. “From the state’s standpoint, there are significant aspects of these cases that have an economic impact. That’s why they were assigned to Ms. Kelley.” Indeed, the major issue the state has with the defendants’ businesses appears to be a question of revenue rather than public safety. Draft regulations prohibiting both marijuana social clubs and delivery services will not be adopted into code until Nov. 24, and could be amended by the Marijuana Control Board in the meantime. The only certainty is that the defendants engaged in sale prior to the issuance of business licenses, and therefore prior to the existence of taxation framework. This past summer, Marijuana Control Board Executive Director Cynthia Franklin sent cease-and-desist letters to social clubs and delivery services, including Egbe’s Alaska Cannabis Club, Pot Luck Events in Anchorage, Wasilla’s Northern Heights, Kenai’s Green Rush Events, Crites’ Absolutely Chronic Delivery Co., and Burns’ and Stamper’s Discreet Deliveries.  Franklin’s cease and desist letters carried less than bulletproof legal weight because of the nebulous legal status of both marijuana clubs and delivery services, and was taken to be a legal suggestion rather than an order. In the cases of Egbe, Burns, Stamper, and Crites, the Anchorage Police Department conducted undercover operations during which they purchased quantities of marijuana from individuals employed by or operating within each respective organization. Organizations that engaged in no sale, however, have not been charged, though they received the same cease and desist letters from Franklin. Pot Luck Events and Green Rush Events, both social clubs, have been vocal about not allowing sale within their establishments, but only consumption and sharing. Consumption and sharing are legal under Ballot 2 language approved by voters a year ago, though public consumption particulars have yet to be fully fleshed out to apply to publicly accessible clubs. Pot Luck owner Theresa Collins said she never noticed police activity in her establishment, but that it must have happened to some extent. “I’m sure they were there,” said Collins, “but they obviously didn’t discover anything too illegal going on.” Further provisions in draft regulations penalize those who have made money in the marijuana industry prior to business license issuance, currently scheduled for May 24, 2016, at the earliest. “The board will not issue a marijuana establishment license to a person that … operated a marijuana delivery service, a marijuana club, or a marijuana establishment illegally without a license issued under this chapter, or otherwise violated AS 17.38, during the two years before the date the person files the application, unless the board finds that person has diligently worked with the board to comply with all current laws and regulations relating to marijuana,” the draft regulations read. Rocky road Burns adamantly claims he has made every attempt to fully “comply with all current laws and regulations,” and has been trying to get a concrete ruling of his company’s legality since he and Stamper began operating in January 2015. Weltzin argues the charges should be dismissed due to the ambiguity and lack of clarity in statute and regulations. “Nobody knows what’s legal and what’s not legal,” Weltzin said. “And even though he asked time and time again, (Burns) didn’t get any guidance from the state.” Burns filed pro se motions (representing himself) with the court to have his charges dismissed, his bail condition rescinded, and the venue of his trial changed. Burns filed motions Oct. 15, prior to obtaining Weltzin as legal representation. In both Burns’ original motion and Weltzin’s reply to Kelley’s denial of the motion, it is argued that Burns was only transporting and accepting money for marijuana equipment, not marijuana itself, and therefore the Superior Court has no jurisdiction to prosecute. Under Ballot Measure 2 language, the sale of marijuana accessories is legal. The definition includes “materials of any kind which are used, intended for use, or designed for…packaging, repacking, storing, vaporizing, or containing marijuana.” Burns claimed he was only selling vacuum-sealed bags, which only happened to contain a legal gift of one ounce or less of marijuana, which he claims is allowable under Ballot Measure 2. Even if illegal, Burns and Weltzin argue, the matter rests with the Marijuana Control Board, not the Department of Law. Burns claims the only concrete direction he received was a green light of sorts from Alaska Marijuana Control Board chairman Bruce Schulte, who stated during a Fairbanks meeting that Burns could continue operations, and that “nobody is kicking anybody’s doors down.” The board’s word, Burns believes, is the only relevant one. Ballot Initiative 2 put the governance of marijuana business under the authority of the Marijuana Control Board. A grand jury formally indicted Burns on Oct. 8, but information was filed Sept. 18. Because Burns filed his motion to dismiss charges Oct. 5, Kelley called the motion to dismiss “moot.” Kelley did, however, respond to several of Burns’ arguments in her rejection of the motion to dismiss, calling them “inventive interpretations of law and assertions that, at best, can be considered potential defenses” that are not themselves satisfactory to dismiss charges. Kelley argues the Anchorage Superior Court has “original jurisdiction in all civil and criminal matters.” Further, Kelley argues Burns was clearly selling marijuana, not marijuana accessories as he claims. Customers made online orders specifying particular marijuana strains, and the amount charged is greater by far than the cost of the $1.50 bag. “The argument that he was selling ‘mechanically sealed metal bags’ is undercut by the amount of money involved in the transactions,” Kelley wrote. “On Jan. 28, 2015, the officer paid $370, plus a $15 delivery fee, for one ounce of marijuana.” Weltzin filed a reply to Kelley and argued Burns’ main points filed in his motion to dismiss: that he was in compliance with existing marijuana laws and therefore the Marijuana Control Board’s authority. She reinforces Burns’ original argument that he was not selling marijuana but transporting marijuana accessories, as well as marijuana itself in compliance with weight restrictions under one ounce. Payment, Weltzin argues, was to recoup the expenses of delivery service, not in exchange for marijuana itself. She details the costs of Discreet Deliveries operations, and concludes the business was, in fact, operating at a loss. “The costs and expenses of facilitating the transportation of an ounce of marijuana breaks down to approximately $408 per ounce,” Weltzin wrote. “Not only was the real and actual cost of transporting the marijuana and marijuana accessory credible, it was actually delivered at a loss to the company.” In light of this, Weltzin argues, Burns should not be “targeted as a guinea pig for trial and error” by the state as a result of jurisdictional confusion. Undercover officers were charged similar prices for similar quantities of marijuana when they purchased one ounce of marijuana from Absolutely Chronic Delivery Co. for $360 plus a $10 delivery fee. In August, another purchased an ounce for $410. An undercover officer purchased one-eighth an ounce of marijuana from Alaska Cannabis Club for $50, and another purchased an ounce for $450. Weltzin said it is only coincidence that Burns charged an amount similar to the apparent market price of one ounce of marijuana. Weltzin did not comment on Burns’ other motions. Burn’s change of venue motion alleges he would not receive a fair trial in Anchorage, and requests to hold the jury trial in Palmer. “The tainted jury pool created in the Anchorage are through local media, quoting local heroes that are stipulating the current law, create a prejudice against the defendant,” the motion reads. Burns cites, as proof of an Anchorage vendetta against him, the fact his Fairbanks operation was raided by Anchorage Police Department. Burns also claims to have been a “victim of threats from a House of Representatives member, stating that he is a target. That Representative is in the Anchorage Borough Area.” Burns was referring to Rep. Cathy Tilton, R-Wasilla, with whom Burns had an email exchange in September during which Tilton wrote, “Your flippant arrogance has made you a target.” Kelley wrote a brief recommending the denial of Burns’ change of location request. “The majority of charges relate to conduct that took place in Anchorage,” Kelley wrote. “The defendant himself admits to conducting business all over the state. Further, the impartiality of an Anchorage jury has not yet been determined – such a determination can only come after a thorough questioning of potential jurors.”

Legislature approves TransCanada buyout

The state of Alaska will now own more of the big Alaska LNG Project. It will have to shell out more money for it, too. Alaska’s Permanent Fund may have to be put up as collateral, also. Legislators have been meeting in special session in Juneau since Oct. 24 to review Gov. Bill Walker’s proposal for the state to buy out TransCanada’s share of the planned $45 billion to $65 billion pipeline and liquefied gas project. On Nov. 3 and 4, the state Senate (16-3) and House (39-0) gave their approvals. The acquisition is to be effective Dec. 1, under terms of the legislation. SB 3001 appropriates $68.4 million to repay TransCanada for its expenses to date in preliminary engineering on its share of the project. The bill also authorizes Alaska Gasline Development Corp., the state gas corporation that will step into TransCanada’s place, to spend $75.6 million to pay would have been the pipeline company’s share in completing preliminary engineering now underway. Preliminary engineering is expected to be finished in mid-2016. Delaying the purchase would have hiked the state’s costs. “Today is better than tomorrow to take this off-ramp” with TransCanada, said Sen. Anna MacKinnon, co-chair of the Senate Finance Committee. “This legislation is a debt we need to pay TransCanada, and our state administration, which wants a gas pipeline as much as we do, needs our support.” TransCanada, the state, and three North Slope gas producers, BP, ConocoPhillips and ExxonMobil, are in a partnership to build Alaska LNG, a $45 billion to $65 billion North Slope gas pipeline and LNG project that would export up to 20 million tons per year of liquefied gas. The state actually holds 25 percent of the project in line with its share of North Slope gas reserves but in a 2014 agreement with TransCanada brought in the pipeline company as an investor and owner of the state’s one-quarter share of the 800-mile pipeline and large gas treatment plant on the North Slope. The state itself would invest in, and own, 25 percent of the large LNG plant planned at Nikiski. About half of the project’s overall investment would be in the LNG plant. The contract with TransCanada had a provision for the state to buy back the pipeline and gas treatment plant holding by December 2015, repaying the pipeline company for its investment to date. That is now being done. The governor proposed the buyout on the grounds that the state would be financially better off in the long term owning its full 25 percent share rather than splitting it with TransCanada. Marty Rutherford, Deputy Commissioner of Natural Resources, said the state could earn up to an additional $400 million per year from the project through owning the full quarter of the project. That’s mainly because the state will have cheaper financing costs, as a government, than would TransCanada and won’t have to pay shipping tariffs. In an interview, Rutherford also said the state needs to be at the table now, representing its upstream interests, during discussions of final engineering and cost allocations on the gas treatment and dispositions of byproducts like carbon dioxide. “We have a more direct interest in these, as an upstream resource owner, than does TransCanada, which would have been a midstream owner. We have to engaged ourselves in negotiations and not have to rely on TransCanada as our representative,” Rutherford said. Decisions of allocation of upstream costs related to the project could result in billions of dollars of gain or loss to the state over the life of the project, Rutherford said. Although most state legislators backed Walker’s decision on the acquisition there is still serious concern as where the state can adequately manage its 25 percent share, and also how the state will acquire the financing for hefty investments TransCanada would have made. The state is already running huge budget deficits due to the slide in crude oil priced and state oil revenues. As the full one-fourth owner Alaska will have to come up with an estimated $675 million if the project moves into the final engineering phase, or front-end engineering and design, and an estimated $13 billion to fund one fourth of construction costs. Cash calls for the building the project would come from 2019 through 2024, years when construction would be underway. State officials are looking at a variety of ways the financing could be done including issuing state general obligation bonds, which would require voter approval, or revenue bonds under a project financing plan that would pledge future revenues to repay the bonds. Some form of financial guarantee from the state would likely be required by lenders under a project financing plan, Rigdon Boykin, a consultant who is the state’s lead negotiator in talks now underway among the gas project partners, told a state legislative committee in early September. The state’s Permanent Fund, a $53 bill savings fund from accumulated oil revenues, could be used as part of a guarantee. Alaska’s constitution prohibits spending money directly from the Permanent Fund but there are ways the savings fund can be used to help leverage a financing package. In legislative hearings this week and last in Juneau, lawmakers also grilled state administration officials on whether Alaska Gas Development Corp. or AGDC, has the experience or staffing adequate for overseeing the state’s interest for the full 25 percent share. MacKinnon, co-chair of the Senate Finance Committee, said one of the original reasons for bringing in TransCanada was to have the pipeline company’s expertise available to the state. Dan Fauske, CEO of the state gas corporation, told legislators that AGDC has built its staff and honed experience over the last year while completing final engineering on a smaller gas pipeline that could be built from the North Slope in case the large project falters. Final permits for the smaller Alaska Stand Alone Pipeline are also being secured, Fauske said. “We’ve demonstrated that we can do this. This (ASAP) project is ready to go if we need it,” he said. There was some reluctance among some legislators to vote for the legislation, despite widespread support. Rep. Wes Keller, R-Wasilla, said he wanted to vote “no” as a protest over the administration’s reluctance to share information with the Legislature in a timely manner. Rep. Dan Saddler, R-Eagle River, said he is also concerned. “There hasn’t been a lot of clarity from the administration, particularly about who is in charge,” within the administration’s negotiating team, he said on the House floor. “I’m also concerned about the administration’s undue focus on failure rather than success. For example, the governor’s insistence on a withdrawal provision,” to cover contingencies of a withdrawn partner, might be more of a distraction for the project negotiations than a positive move. Tim Bradner can be reached at [email protected]

Confluence of factors causing disconnect in salmon pricing

Seafood producers were hoping U.S. consumers would have cheaper salmon this year, but that doesn’t seem to be the case.  The $8.99 per pound of Alaska sockeye the U.S. consumer pays at a minimum in Anchorage isn’t making its way back down the chain to the fishermen, whose overall pay has been slashed in half by a cyclone of every possible negative market pressure and a marketing campaign that keeps prices high and attracts fraudsters. Bristol Bay produces the world’s largest natural sockeye run and the most valuable fishery in Alaska state waters, but after one of the largest harvests on record with 37 million salmon, Alaska fishermen experienced a severe shortfall on the 2015 season price. The voluntary 0.5 percent tax processors pay to the Alaska Seafood Marketing Institute, representing roughly half its operating budget, funds a marketing campaign almost too successful for its own good. Alaska wild-caught salmon is marketed so aggressively and successfully as a high-end product the brand brings in frauds and keeps prices high for the consumer even as fishermen are losing money. Meanwhile, retailers are relying on the trained consumer base to continue paying for the traditionally expensive fish. “Retailers can slap a price tag on anything,” said Jerry McCune, president of United Fishermen of Alaska, the state’s largest commercial fishing industry group. “We have no control on what they retailers put on it.” Bristol Bay fishermen received 50 cents per pound of sockeye as the ex-vessel price from the area’s fish processing plants, less than half the average price processors paid Bristol Bay fishermen in 2014. Processors in turn sell to retailers at wholesale prices. Fishermen often suspect processors when ex-vessel prices are too low relative to the retail price, but comparisons of ex-vessel prices to wholesale prices indicate processors lowered their wholesale prices right along with the fishermen’s pay. Spot prices link wholesale value with ex-vessel value in roughly the same historical ratio as prior years. Between 2005-2014, according to Alaska Department of Fish and Game records, the average wholesale price for head and gutted, or H&G, Bristol Bay sockeye was $2.58 per pound. For fillet with skin and no ribs, the average was $4.83. In the same time period, the average ex-vessel price for Bristol Bay sockeye was 99 cents per pound. Processors do not share first wholesale value until April, nor do they share that price with media. On Tradex Live, an online seafood brokerage, a batch of Alaska-caught skin-on sockeye fillets sold wholesale for $4.40 per pound, roughly on par with the average $3.84 above ex-vessel price for fillet with no skin and ribs. In retail stores, however, little has changed for sockeye prices, which remain at their usual fall/winter prices. Anchorage’s sockeye salmon goes for $8.99 per pound for skin-on fillets at Carrs or $11.96 per pound at Walmart. In Seattle’s Whole Foods, Alaska sockeye is $14.99 per pound. Alaska seafood marketing experts said such prices should be expected at the retail level regardless of what fishermen are actually being paid. Wild-caught Alaska sockeye is a specialty item for which retailers have worked very hard to justify a healthy markup. Customers in the market for sustainability and healthy local economies don’t know Bristol Bay dock prices well enough to see retail prices are amiss. Earlier in the year as salmon producers predicted excess supply, some hoped customers would get hooked on Alaska sockeye at a lower price, but that hasn’t materialized on the retail level. “Prices may be lower, but the volume of pink and sockeye will likely increase,” wrote McDowell Group economist Andy Wink in an email to the Journal in April. “Even if fishermen do not make much, if any, lower prices driven by supply benefits the industry in the long run because it increases consumption. Generally that demand carries over for some time.” This has not yet proven to be the case, however, as consumers are still content to pay the usual for sockeye. “The retailers are in a very strong position,” said Tyson Fick, director of communications for the Alaska Seafood Marketing Institute. “They’ve trained their customers over the years that Alaska salmon is a premium product worth paying extra for, and the average customer in the Lower 48 isn’t aware of the economic situation here. “They can put us on a price competition with Russian or farmed, then they get to pocket the difference. And why wouldn’t they?” Alaska sockeye vs. the world The low ex-vessel price comes from a perfect storm of negative price pressures the industry has feared since before the first sockeye returned to the Bay. Skepticism earlier in the year has proven well-founded. Alaska seafood marketers hesitated to guess earlier in the year, but Northrim BanCorp CEO Joe Beedle, who takes part in economic forecasts, was forward with his pessimism. “Fishermen will get 25 percent less this year because of the strength of the dollar and the high supply,” said Beedle at an editorial board meeting on April 2. Indeed, Fick said the one of the biggest drivers for the 50-cent dockside sockeye price is the dollar. Sockeye has a domestic market but is still primarily an export product. Alaska exports 70 percent of its wild-caught salmon, with particularly strong markets in China, Japan, and Europe. “With currency values,” Fick said, “it’s difficult on our customers. They have decreased buying power, in some cases as much as 35 percent less. It has the combined problem of making our competitors look better on a price basis.” Japan, Alaska’s second-largest single seafood market behind China, imported $132 million worth of Alaska salmon in 2014. From its highest point during 2014, the Japanese yen’s value has fallen 22 percent against the U.S. dollar. The U.S. dollar’s strength works against U.S. salmon on the domestic market. Norway, Chile, and Canada produce the vast majority of farmed salmon on the U.S. market, which accounts for two-thirds of total U.S. salmon consumption. Chile, which produces roughly one-third of the U.S. farmed salmon imports, has also seen the value of its currency, the Chilean peso, drop 16 percent against the U.S. dollar from November 2014 to November 2015, giving the U.S. greater purchase power. In Norway, which produces another third of U.S. farmed salmon, the Norwegian kroner dropped 25 percent against the U.S. dollar in the same time period. Abroad, some markets have closed while others suffer under the dollar’s value. In August 2014, Russia enacted a ban on seafood imports from the U.S., European Union, Canada, Australia, and Norway in retaliation for U.S. sanctions against the Russian Federation.  Norwegian fish have few places to go except the U.S., out pricing Bristol Bay salmon at the retail level. Meanwhile, the U.S. dollar’s relative strength is preventing the product from marketability overseas. “The domestic market can only absorb so much of this,” said McCune. “The exchange is killing us in Europe.”  Relationships with Russia have multiple effects. Russian sockeye from the North Pacific still competes with U.S.-produced salmon in the U.S. market, but far cheaper due to the strength of dollar against the ruble, which has fallen 48 percent in value against the dollar in the last 12 months. Ukraine, in the midst of the conflict with the Russians that caused the sanctions, also has less to spend on imports. However, Alaska salmon doesn’t have the same opportunity on the Russian market. Russia’s U.S. seafood import ban hasn’t been reciprocated by the U.S. government, which still welcomes cheaper Russian imports. While U.S. consumers buy Russian sockeye, Russian and Eastern European markets are closed to Alaska salmon roe, one of the more valuable seafood products. Russia and Ukraine, at the height of consumption in 2013, purchased nearly 10 percent of the total $1.1 billion of Alaska salmon exports. Russia imported $46.6 million worth of Alaska roe. Ukraine imported $31 million of roe and $15 million of fresh and frozen pink salmon. Alaska sockeye vs. itself As if geopolitics weren’t enough, Alaska sockeye have had to battle surplus from the 2014 season, which left processers and retailers stuffed with canned and frozen sockeye that required U.S. government action to try to ease. Next year, the situation will continue if the 2015 harvest creates the same surplus running into another big year. “There’s the surplus,” said Fick. “The amount of supply is way up from the big run now and surprisingly large run last year, where producers had product in the freezer going into this season.” The Alaska all-species salmon harvest for 2014 totaled 157.9 million, or 25.3 million more than the pre-season forecast and the second largest harvest in a decade. This included 44.1 million sockeye salmon. At the urging of Sen. Lisa Murkowski, Secretary of Agriculture Tom Vilsack authorized the U.S. Department of Agriculture to purchase up to $30 million worth of surplus canned Alaska sockeye salmon that’s been crowding processor storage since a blockbuster 2014 season in Bristol Bay. USDA bought $22.5 million of canned sockeye from Peter Pan’s Astoria, Ore., plant and Icicle’s Egegik plant. Icicle sold $11.8 million. Peter Pan sold $10.7 million. The product was sold in cases of 24 7.5-ounce cans between $31.40 and $36 per case. At 11.4 pounds per case, the USDA paid between $2.75 and $3.16 per pound for the canned sockeye, a total of 7.6 million pounds. The past two sockeye seasons both exceeded or met large expectations, and the trend will continue on into next year. Alaska’s most valuable fishery, and the world’s largest wild sockeye salmon run, will have another massive run and commercial harvest, if the Alaska Department of Fish and Game’s forecast is accurate. ADFG biologists are forecasting 46.5 million sockeye in the 2016 run, with an allowable commercial harvest of 31.2 million. Both the run size and the harvest prediction surpass both recent and long term averages. The run forecast is 15 percent greater than the previous 10-year average, and 41 percent greater than the long-term average of 32.9 million. The projected harvest is broken down between 29.52 million fish in Bristol Bay and 1.72 million fish in the South Peninsula fisheries. A Bristol Bay harvest of 29.52 million would be 8 percent greater than the previous 10-year average of 27.3 million, and 46 percent greater than the long-term average of 20.2 million. Alaska sockeye vs. retail labels Retailers charge a premium for Alaska sockeye and people are willing to pay it, but some of what’s sold isn’t Alaska wild-caught sockeye at all, depending on region on time of year. Oceana released a study detailing that 43 percent of their 82 grocery store and restaurant samples of Alaska salmon were mislabeled, according to DNA samples; 69 percent were farmed Atlantic salmon being marketed as Alaska or Pacific wild-caught. Oceana’s methodology isn’t discussed in the report. The study only took samples from East Coast and Midwest establishments during the winter of 2013-14, when salmon production is at its lowest. The report in fact clashes with a 2013 Oceana study, which found only 7 percent mislabeling of salmon in 2012, but during the height of the season when salmon were readily available and largely from grocery stores. ASMI Executive Director Alexa Tonkovich recognizes the problem, and said it’s a least got a silver lining. People recognize the Alaska wild-caught brand enough for frauds to want on the bandwagon. “It’s great they want to copy us,” said Tonkovich. “It means we have a strong brand.” DJ Summers can be reached at [email protected]

DOT forced to cut road crew OT as result of budget cuts

Snow has fallen across much of Alaska, and winter tires could be more important than ever this season. Cuts to the state operating budget have forced the Alaska Department of Transportation and Public Facilities to eliminate 35 surface transportation maintenance positions and abolish overtime for winter road crews. DOT took a $34 million hit — a 12.5 percent reduction — to its fiscal 2016 general fund operating budget, most of which goes to running the Alaska Marine Highway System and maintaining the states roads, runways and other facilities. “We had cuts across the entire department. Those included the removal of positions and many of those positions were maintenance positions,” DOT spokesman Jeremy Woodrow said. The department’s unrestricted general fund budget is $247.9 million this fiscal year. Saving money through efficiencies and doing away with vacant positions were the first steps to avoid pink slips, but in the end, 85 positions either went unfilled or were cut through direct layoffs in DOT this fiscal year, Woodrow said. There were 556 equipment operators in DOT last fiscal year to clear the state’s roads and airports, according to the 2015 State of Alaska Workforce Profile report. The cuts to road crew man-hours were felt right away in Fairbanks when the city endured more than a foot of snow in late September. Woodrow said DOT received numerous complaints and inquiries regarding road conditions after the Sept. 25 and Sept. 29 storms. A repeat of last winter across much of Alaska could be helpful, to road crews anyway. “It’s one of those things, if it’s a real mild winter no one will have a clue; they won’t notice any change at all” in road maintenance, he said. A road prioritization scale has been made available so the public can know ahead of time which roads will get the first plows during major snow events. The five road priority levels are based on traffic volume, speed, connectivity between communities and other available routes within local transportation networks, according to a department release. They are defined by DOT as: Priority Level 1: high-volume, high-speed highways, expressways, minor highways, all safety corridors and other major urban and community routes. May take up to 24 hours to clear after a winter storm. Priority Level 2: routes of lesser priority based on traffic volume, speeds and uses. Typically, these are major highways and arterials connecting communities. May take up to 36 hours to clear after a winter storm. Priority Level 3: major local roads or collector roads located in larger urban communities. May take up to 48 hours to clear after a winter storm. Priority Level 4: minor local roads that provide residential or recreational access. May take up to 96 hours to clear after a winter storm. Priority Level 5: roadways that are designated as “No Winter Maintenance” routes, e.g. Denali Highway or Taylor Highway. Generally cleared only in spring to open road for summer traffic. Woodrow said the department has always had the winter road maintenance scale internally, but never felt the need to publicize it, as crews working extra hours made delegating resources less necessary. “We just don’t have the resources that we have had in the past,” he said. A map detailing which priority level Alaska’s roads fall under is available on the Department of Transportation and Public Facilities website at dot.alaska.gov/stwdmno/wintermap/index.shtml. Transportation maintenance fund DOT Commissioner Marc Luiken has proposed setting up a surface transportation maintenance fund to balance the ebbs and flows of funding to something as crucial to all Alaskans as road and airport upkeep. “This (fund) wouldn’t build capital, this is intended to take care of the system,” Luiken said. The fund would designate revenue from fuel and vehicle taxes and fees into general road maintenance expenses. He said it would “even the playing field” between some coastal Alaskans who feel the state ferry funding is unduly scrutinized by those on the road system. It could also be a starting point for beginning talks about raising the motor fuel tax or other vehicle fees to in-turn adequately supply the fund, he surmised. At 12.25 cents, Alaska’s total gasoline tax is the smallest in the nation. Pennsylvania and Washington have the highest state gas taxes at 55.3 cents and 44.5 cents, respectively, according to the American Petroleum Institute. The Alaska Aviation Advisory Board is recommending to raise aviation fuel taxes to help pay for airport maintenance and a stated goal of the Federal Aviation Administration found on its Alaskan Region website is to “Encourage (Alaska) to establish dedicated airport fund and pursue all aviation resources to adequately fund maintenance.” Some legislators he has talked to have been intrigued by the idea, Luiken said, but whether shifting dwindling state funds or raising taxes will ultimately be palatable is unclear. The funds are very common in other states — to the point where when his colleagues in transportation departments across the country hear Alaska does not have a transportation maintenance fund, “their jaws drop,” Luiken said. Elwood Brehmer can be reached at [email protected]

Bad for state budget, cheaper fuel helping local economies

Alaska’s economies appear to be unfazed more than a year after oil prices began to fall. In fact, Anchorage’s unemployment rate of 4.7 percent in September was the lowest in the city has seen for the month in 14 years, according to the Anchorage Economic Development Corp. Fairbanks was not far behind at 4.9 percent. Statewide, the seasonally adjusted unemployment rate, which accounts for seasonal swings in job availability, was 6.4 percent in September, down 0.4 percent from a year ago, the state Labor Department reports. AEDC President and CEO Bill Popp said state’s largest city has added about 2,000 jobs since last September, bringing total employment to 169,000 in a municipality with just more than 300,000 people. AEDC’s January forecast for flat employment in Anchorage this year was incorrect in a positive way, Popp noted. At that time, he emphasized that a steady number of jobs should be viewed as a good thing, given the uncertainty surrounding state spending and petroleum economics. “We’ve been seeing this starting to build up over the summer. We’ve been seeing a drop in unemployment rate and modest but continued growth in the job numbers and now we are feeling like if this trend continues, which we think it will, we’ll probably add 1,000 net jobs in Anchorage this year,” Popp said. He attributed the encouraging job numbers to a strong private sector. According to AEDC, nine of Anchorage’s 10 largest industries have seen job growth over the past year. The only industry to show a loss is the city’s small manufacturing sector, down a miniscule 11 positions from a year ago. Employment in the city’s oil and gas industry actually increased more than 150 positions over the past year; however, the loss of Shell’s Arctic business, announced Sept. 28, has not yet been accounted for. Statewide, oil and gas industry employment has continued near record highs in 2015, as have the number of construction jobs in the state, many of which are tied to oil and gas activity. Government employment in Anchorage has been flat in 2015. Business and professional services positions, which includes technical industries that benefit from public and private capital spending, are up 100 jobs from last September, according to AEDC’s monthly employment report. Popp said activity at Anchorage’s banks and credit unions is slower than would be ideal. He attributes that to the city’s ever-present housing issues. Single-family home inventories are the lowest they’ve been in five years — an average of 877 homes listed in September — which has continued to push the cost of buying a home in Anchorage up and price many prospective buyers out of the stalling market. With few houses being sold, lenders have little reason to hire, he said. Since oil prices and state revenue both began falling 16 months ago, state government employment — University of Alaska included — is down about 1,500 positions, Popp said, but only about 100 of those jobs have been lost in Anchorage. As an entire sector, government provides about 29,000 jobs in the city, and the decline in federal employment over the past few years appears to be slowing, he said. Anchorage has seen lower oil prices — more specifically lower fuel prices — benefitting some of its largest employers. Passenger traffic was up more than 8 percent during the summer months at Ted Stevens Anchorage International Airport. AEDC also expects landed cargo tonnage to increase about 10 percent this year and that growth to continue for several years. Anchorage Airport officials have said the bump in passenger traffic is likely due mainly to Lower 48 travelers spending energy savings on travel. Much the same can be said for the city’s hospitality industry. “One-in-5 jobs in Anchorage are benefiting from lower fuel prices,” Popp said. The airport and hospitality industries each support approximately 1-in-10 jobs in Anchorage, according to AEDC. Popp noted those estimates are conservative. “I think it shows us in a pretty good spot to start from as we face the headwinds of next year,” Popp said of Anchorage’s employment figures. Popp and Fairbanks Economic Development Corp. President and CEO Jim Dodson both noted that hidden in the low unemployment figures is the fact that Alaska’s population is unusually transient, and people unable to find work are more likely to leave the state rather than file for unemployment. Net migration in the state totaled a loss of about 7,500 people last year, many of whom were working-age adults, Popp said. Big swings in migration to and from Alaska are not uncommon, however. When the Lower 48 economy suffers people come to Alaska looking for work and when the U.S. economy as a whole improves, they tend to leave, according to state economists. How Anchorage and the state fare in 2016 and beyond will have a lot to do with what happens in Juneau and whether or not consumer confidence can hold on, he said. Anchorage consumers are generally content with the city’s economy and their current personal financial situations, according to AEDC’s latest quarterly consumer optimism survey. However, expectations for the economic future are exactly tepid, with consumers reporting uncertainty about what’s to come. “Right now, (consumer optimism) doesn’t seem to be manifesting itself into any kind of slowdown in the economy, but it’s something we need to pay really close attention to because if consumers lose optimism they’re going to stop spending,” Popp said. “It can have a pretty significant ripple effect if we are to lose that confidence.” Dodson and Popp also said further deep cuts to state government spending in the upcoming regular legislative session would do a great deal of harm to Alaska’s economy that relies heavily on government employment. State government employees make up 7.3 percent of Alaska’s current workforce, according to the state Labor Department. Further, local government — heavily reliant on state assistance — provides another almost 12 percent of jobs in the state. “There is some room for cuts in our view and not insignificant cuts (to state government), but they need to be well targeted and we need to be looking at revenue streams that can balance the books and put our fiscal house in order for the foreseeable future and then we start to address that uncertainty issue,” Popp said. Economies across the state are continuing along with business as usual in part because the impact of capital spending lags behind appropriations by a couple years, Dodson noted. The 2014 state fiscal year capital budget, with federal funding, was more than $1.9 billion. “I don’t think any of the communities are going to be exempt from the lack of state spending; that’s going to be something that affects all of us,” Dodson said. On the bright side, Interior Alaska has benefitted more directly from low oil prices. Heating, or fuel, oil, the region’s primary space heating energy source, has gone from about $4 per gallon less than two years ago to about $2.50 per gallon today. Historically, Fairbanks-area residents have allocated about 60 percent of their overall energy costs to heat, according to Dodson. At $4 per gallon, that equates to an average of $4,300 per year spent towards homes that rely on fuel oil. “There is a tremendous amount of spendable dollars left in our economy that were typically spent for heating our homes,” he said. Additionally, a resurgence in military spending in should help mitigate state cuts around Fairbanks. The pair of F-35 squadrons that are all but a certain to end up at Eielson Air Force Base are expected to bring hundreds of jobs and hundreds of millions of construction dollars to the Interior. At Fort Wainwright, a company of unmanned Gray Eagle aircraft will add nearly 130 base positions, while nearby Fort Greely and Clear Air Force Station are seeing an influx of money, too. The area’s economy has immense ties to its military bases; defense activity accounts for more than a third of Fairbanks’ economy, while state and federal civil spending total about 10 percent apiece, according to Dodson. “There’s no question about it; Fairbanks is a military town,” he said.

IUU bill passes, but more int’l action needed

A bill addressing pirate fishing waits on the president’s desk, but even if signed, the international problem will need more international solutions. On Oct. 22, the U.S. Senate approved the Illegal, Unreported, and Unregulated Fishing Enforcement Act of 2015. The bill is the latest in a series of legislative and executive actions broadly aimed to get international pirate fishing under control. Illegal, unreported, and unregulated fishing, or IUU fishing, is too big a problem to handle domestically; the best that can be done at the national level are largely vague enforcement strategies or information sharing programs between law enforcement entities on either side of the Bering Sea. The president’s signature, if he assents, will serve as more a show of intent than a comprehensive overhaul, with the U.S. finally joining the Port State Measures Agreement, the largest but most problematic international piece of the IUU puzzle. IUU fishing is a worldwide problem but damages Alaska disproportionately as both the largest seafood producing U.S. state and one of the world’s largest seafood producers in its own right. “It drives me crazy to think that I can go into a Costco back home (in Alaska) and go over the counter to buy king crab that’s marketed as Alaskan but I don’t have that surety of knowing it is Alaskan,” Murkowski said in a press conference. Estimates vary regarding the economic impact of IUU fishing, in large part because the expansive data is nearly impossible to compile. The U.S. Coast Guard, however, estimates IUU fishing annually drains $10 billion to $23 billion away from the legitimate seafood industry worldwide. Russian IUU crab alone has cost Alaska Bering Sea crab fishermen up to $560 million, according to one estimate by United Fishermen of Alaska, the state’s largest commercial fishing industry group. Mark Gleason, executive director of industry group Alaska Bering Sea Crabbers, has been involved with the legislation for years and called its senatorial passage a “huge symbolic victory.” In May, Alaska’s U.S. Sens. Murkowski and Dan Sullivan along with Brian Schatz, D-Hawaii, introduced the bill, which closely mirrored the language Alaska Rep. Don Young’s House bill, which passed on July 27. The bill amends a complicated array of international maritime treaties, broadly aimed to give the National Oceanic and Atmospheric Administration more enforcement ability at U.S. ports where millions of pounds of pirated fish enter domestic markets. It also signs the U.S onto the international Port State Measures agreement, which establishes port controls for member nations to keep tabs on IUU fishing. Murkowski said the bill makes it clear at U.S. ports there’s “a cop on the beach,” but it’s unclear what the legislation would change operationally for NOAA. Murkowski said NOAA’s law enforcement will now have the ability to compile lists of known IUU vessels, as well as the authority and ability to turn these vessels away at port pending discovery. “The most important thing is making sure we’ve got the ability to deny entry if a vessel is listed as an IUU vessel, giving the enforcement side some teeth,” said Murkowski. “It probably will require that NOAA have more resources directed to its enforcement.” The price tag for the increased NOAA law enforcement is unknown along with the particulars of how day-to-day operations would change for the administration. NOAA representatives would only say they are “looking into how this new legislation can assist our mission to protect sustainable fisheries at home and abroad.” The most important piece of legislation is the U.S. government’s signature on the Port State Measures Agreement. The agreement would require that each nation under the agreement require foreign vessels delivering seafood to provide highly detailed reports in advance of port entry, showing a full chain of legal custody for seafood imports and exports. To pass as an international measure, the agreement needs to be ratified by 25 countries. If signed, the U.S. will be the 14th. A presidential task force on IUU fishing had adopted the end of 2015 as tentative timeline for successful total ratification. Murkowski said the U.S. will have to wheel and deal to get the necessary 25, possibly using the agreement as an international bargaining chip with nations who profit from IUU fishing. Such nations, she said, receive too much benefit from IUU seafood’s economic value to make the agreement attractive. “I use the example of the Russians with the illegal take of crab, putting that out and flooding the market with additional crab thus lowering the price,” said Murkowski. “When they are violating terms of agreement, we have other negotiations we engage with in Russia in other matters. We can come back to the violation and say ‘in order for us to continue…we need you to be a more cooperative neighbor for our fisheries.’” Russian IUU crab has been linked to organized crime in that country, making IUU enforcement a joint problem in the North Pacific. The U.S. and Russian governments signed a bilateral agreement on Sept. 11 mostly aimed at information sharing between law enforcement on either side of the Bering Sea. DJ Summers can be reached at [email protected]

Alaska tops US seafood production; adds jobs

Alaska once again led the nation’s seafood output in 2014, according to a recently released report from the National Oceanic and Atmospheric Administration. According to the administration, or NOAA, Alaska led all states in sheer volume of U.S. seafood landings with 5.7 billion pounds valued at $1.7 billion. The next closest state was Louisiana shrimp-based fisheries at 870.5 million pounds. Overall, landings and values are both down from 2013, though NOAA officials say the trends are still positive. The U.S. is the second largest consumer of seafood in the world, even with a relatively small per capita consumption of 14.6 pounds per person per year, steady from 2013’s 14.5 pounds per person. U.S. fishermen landed 9.5 billion pounds worth $5.4 billion in 2014, a decrease of 394 million pounds and $43 million compared to 2013. Alaska’s $1.7 billion was the greatest value as well as the greatest volume for seafood landings. The next closest were Maine and Massachusetts at $547.7 million and $524.7 million, respectively, powered by American lobster and scallops, two of the most valuable fisheries in the U.S. Alaska’s ports led the nation in quantity of landed seafood, but not in value. Of the top five most voluminous seafood ports, Alaska claimed three, spearheaded by Dutch Harbor’s 761.8 million pounds worth of seafood, mostly walleye pollock. Salmon dominate Alaska’s state fisheries, but on the high seas whitefish is king. Pollock, flatfish, and cod topped the list of Alaska’s harvest by value at 3.2 billion pounds, 736.8 million pounds, and 722.7 million pounds, respectively. NOAA’s report also included an analysis of recreational fisheries, which figured heavily into the economic value of Alaska’s seafood as well as commercial landings. The numbers for Alaska for 2014 were not available for this year’s study. However, the national total was 68 million trips. In 2013, 312,000 marine recreational fishing participants took over 595,000 trips and caught a total of nearly 2.6 million fish, including Pacific halibut, rockfishes, Pacific cod, lingcod, and the salmons: chinook, chum, coho, pink and sockeye. Halibut topped the list of most caught fish, seconded by coho salmon and pink salmon. According to a separate study, Alaska marine recreational fishing in 2013 generated 5,500 full- and part-time jobs, $642 million in sales impacts, $261 million in income impacts, and $386 million in value added. Fishing trips expenditures totaled $451 million. Of the Alaska marine recreational participants, 59 percent were non-residents. Aquaculture accounted for half the world’s seafood production, but the U.S. is lagging behind at No. 14 in the aquaculture development rankings. NOAA officials said in a press conference they have seen some increased U.S. aquaculture development and hope the trend continues. In 2013, freshwater plus marine U.S. aquaculture production was 662 million pounds and $1.37 billion, an increase of 68 million pounds in volume and 140 million in value from 2012. Atlantic salmon was the leading species for marine finfish aquaculture, with 41.6 million pounds produced in 2013, valued at $105 million. In Alaska, seafood harvesting remains a major, and growing, economic driver, according to a report by the Alaska Department of Labor and Workforce Development. At the state level, Alaska’s employment ranks grew 0.7 percent in 2014 as a result of the increased groundfish harvests. Groundfish harvest employment grew steadily from month to month by a total 24.8 percent, adding 350 jobs overall. Salmon harvesting jobs, however, dipped slightly with a 0.7 percent job loss in 2014, or 37 jobs. Even though Southeast Alaska lost 2 percent of its fishing jobs in 2014, the region still has the largest percentage of individuals employed by the commercial fishing industry at 28 percent. Aleutians and Pribilof Islands, with growth for groundfish harvesting jobs, followed at 21 percent, Southcentral at 18 percent, Bristol Bay at 17 percent, Kodiak at 9 percent, and Yukon Delta at 5 percent. In Southcentral, with the state’s largest urban cores, salmon dominated fishing jobs; 77 percent of Southcentral’s harvesting jobs were for salmon. DJ Summers can be reached at [email protected]

State board sets new method for workers’ comp payments

The state has adopted a new method for paying physicians and other health providers for services provided under Workers’ Compensation to injured workers. New regulations were adopted Oct. 29 by the Alaska Workers’ Compensation Board, which met in Anchorage. The change is aimed at slowing an annual rise in medical payments under workers’ compensation claims that result partly because of the payment formula. The new procedure, approved by the Legislature in 2014, replaces the previous system of paying medical service providers at the 90th percentile of “usual and customary” fees in the region with a new method that sets a value for a procedure that accounts for a provider‘s work, practice expense and malpractice insurance. The value is adjusted by a regional multiplier that adjusts for higher Alaska’s higher costs. Thirty-two other states have adopted the new payment system for workers’ compensation, according to Marie Marx, director of the Division of Workers’ Compensation. “Alaska has used the usual, customary and reasonable (UCR) fee schedule since 2004. The UCR rate was set at the 90th percentile, so for every procedure in workers’ compensation, the ninth-highest payer was considered the maximum allowable rate,” Marx said. “This schedule was inherently inflationary, because once a fee schedule was published charges tended to rise to and above the maximum level of payment, which guaranteed an annual increase in the UCR charge. “The new methodology, called the Resource-Based Relative Value Scale, assigns a relative value to each procedure, and then applies a multiplier (a fixed conversion factor). The value is multiplied by the fixed conversion factor set by the state to determine the amount of payment.” Marx acknowledged that not everyone is happy with the new system. “We received many public comments, and the reaction was varied,” she said. In a statement, the Department of Labor and Workforce Development said, “Alaska has had the highest workers’ compensation rates in the nation over the past decade although Alaska workplace injuries have declined significantly. The new fee schedule should reduce workers’ compensation costs.” That will result in lower workers’ compensation premiums paid by employers in the state. Other states have had to cut workers’ compensation, in some cases allowing companies to opt out, the department said. In contrast, “Alaska has sought to strengthen its system while also working to reduce costs for businesses that pay premiums.”

Movers & Shakers 11/08/15

David Ridge, director, marine operations, for Crowley Maritime Corp., was presented with the 2014 Thomas Crowley award, the company’s highest honor, at a recent ceremony at the company’s Anchorage office. The exclusive employee recognition program was created in 1985 and only 60 of the company’s more than 5,300 employees have received the award symbolized by a limited edition bronze sculpture, which depicts company founder Thomas Crowley ferrying goods to and from ships on San Francisco Bay in the early 1890s. Crowley’s Chairman, President and CEO Tom Crowley Jr., the grandson of the company’s founder, presented the award before more than 70 employees and senior leaders who had gathered from around the world for the event. Included in the audience were two past recipients of the coveted award, Bruce Harland, vice president, marine solutions, and Craig Tornga, vice president, government relations. Ridge, a 30-year Crowley employee, was selected for the award because of his reputation for high performance. He works tirelessly to coach his team in Valdez and consistently exceeds customer expectations. He also has been credited for positively engaging with the Valdez vessel crews to continually improve performance and advance the local safety culture. Alaska Rep. Charisse Millett was honored with the Foundation for Government Accountability’s 2015 Legislator of the Year Award Oct. 26 for her leadership in the state to stand up to abuses of executive power. Millett rallied her fellow legislators to challenge Gov. Bill Walker when he abused his power by raiding a mental health trust fund to subvert the legislative process and the state’s separation of powers. Millett is one of a handful of state leaders being recognized from around the country for their work in 2015, and they are the first group of legislators to be honored with this annual award. The U.S. Commercial Service appointed Debbie Franklin as director of the Anchorage-based Alaska U.S. Export Assistance Center to help Alaska firms begin or expand their exporting operations. Franklin is a Certified Global Business Professional with 19 years of international sales and marketing experience. She previously directed the International Trade Center at the Iowa Small Business Development Center where she trained and counseled small businesses on international finance, marketing and global logistics and helped identify export opportunities. The Alaska U.S. Export Assistance Center are ready to help Alaska firms succeed internationally by providing a range of services including: counseling on export mechanics and the development of an export strategy; market intelligence on best export prospects, market conditions, legal and cultural issues and more; matchmaking services to identify qualified foreign distributors and arrange meetings with these pre-screened contacts in the target market; and background reports on potential distributors, agents and partners. Six Alaskans have been appointed to fill vacancies on the 15-member Bureau of Land Management Alaska Resource Advisory Council, which advises the BLM on public land management issues. Each are appointed by the Secretary of the Interior. Stanley Foo of Eagle River and Gary Morrison of Wrangell were appointed as representatives of energy and mineral interests. Pollack (PJ) Simon, Jr. of Allakaket will represent environmental organization interests and Mark Billingsley of Fairbanks will represent dispersed recreation. Brennan Cain of Anchorage will represent Alaska Native interests and John Hopson, Jr., the Mayor of Wainwright, will represent elected government officials. All six appointee’s terms commenced on Oct. 2 and will continue for three years. First National Bank Alaska and its Board of Directors recently promoted four banking experts, announced the move to a different position for another and welcomed a new branch manager for the Main Branch in downtown Anchorage. Monica Barton and Mike Scott bring years of experience to the bank’s Mortgage Loan Department. A longtime regional manager in Wasilla, Barton is now First National’s mortgage loan origination manager and was also appointed vice president. After spending the last several years as a mortgage loan originator, Scott is now a regional mortgage manager. A banker for more than 13 years, Ruth Alphin was named branch manager at the Parkway Branch in East Anchorage after spending more than a year working at both the Northern Lights and U-Med branches as an operations supervisor. Xavier Flint returned to the bank as the new branch manager at Main Branch. He previously worked at First National for three years (2010-13). As a business development representative in the Escrow Department, Ervin Hetemi will be a key player in developing relationship-building strategies to assist customers. He started his banking career in 2008 and joined First National as a personal banker last year. In Kodiak, veteran banking expert Mark Lonheim takes over as branch manager. Lonheim started in banking in 1997 and joined First National in 2013.

The Bookworm Sez: Getting rich through grift

Your numbers weren’t picked last night. Ah, another worthless lottery ticket. No shopping spree or mortgage payoff for you. You’ll have to go to work and get your incredible wealth just like everybody else. Or, as you’ll read in “Prince of Darkness” by Shane White, you could become rich the old-fashioned way: through grift. Though he showed up in New York City in the wake of scandal, nobody knew for sure where Jeremiah G. Hamilton had come from. Some sources said he was born in the Caribbean — which he admitted to, but he also claimed Richmond, Va., as his first home. Nobody knew, though, because Hamilton, an African American man, spent most of his adult life hiding facts and creating fiction. Wherever he got his start, Hamilton launched himself early: in 1828, and “barely into his twenties,” he was involved in a counterfeit scam in Haiti that would’ve meant death, had he been caught. With the help of locals, however, he escaped and arrived in “Gotham,” but not without notice: newspapers of the day splashed the story, but Hamilton managed to keep mum on who’d helped him.  Almost immediately, he started borrowing money in a “frenetic, almost desperate” way, money he had no intention of paying back, which ultimately landed Hamilton in court: there were at least 10 lawsuits against him between 1830 and 1835, and there may’ve been more. Then came The Great Fire of 1835 in which “dozens of acres” of Manhattan were burned to the ground, along with the records of several businessmen who’d been convinced to invest with him. Hamilton denied the transactions, kept their $25,000, and gained the moniker of “Prince of Darkness.”   For the rest of his life — even after being forced to declare bankruptcy — Hamilton always landed on his feet, “shunned” other African Americans, and even invested in companies that overtly practiced racism. He died in 1875 in a “comfortable and elegant” residence he shared with his white wife and family. So why are history books silent on Hamilton’s story?  That’s a question author Shane White had, after he discovered Hamilton’s name and began digging. Could it have been due to the color of Hamilton’s skin? It’s possible, White says, but in “Prince of Darkness,” he also indicates that the lack of documentation may’ve been because Hamilton rankled white financiers and investors, and didn’t appear to care that he’d done so. That insouciance, in light of the racism that Hamilton surely endured, would be an interesting story itself but White embellishes the tale with an abundance of history and extensive biographies of other influential people of Hamilton’s time. That’s good — to a point — but it occasionally can also makes this book deadly dull. I found my mind wandering much more than I might’ve liked. So is this book worth reading?  I think so, but you may want to give it a rest now and then to regenerate yourself. Start it, take a break, repeat as necessary and you might find “Prince of Darkness” to be just the ticket. Terri Schlichenmeyer is the author of The Bookworm Sez, which is published in more than 200 newspapers and 50 magazines throughout the U.S. and Canada. Schlichenmeyer may be reached at [email protected]

Movers & Shakers 11/01/15

PND Engineers Inc. has selected Wade Lundberg, P.E., to be a principal in the firm. Lundberg has 15 years of professional engineering experience, joining PND’s Anchorage office in 2000 and transitioning to its Seattle office in 2007. This summer, he relocated to Houston to help establish PND’s newest branch office. Lundberg has been involved in multiple infrastructure projects in both Alaska and the Lower 48 for resource development and aviation facilities, with particular expertise in design of facilities on permafrost in Arctic Alaska. Joe Mathis with NANA became the Petroleum Club of Anchorage board president for 2015-16 at its 57th annual meeting and board elections Oct. 21, succeeding Lynn C. Johnson with Dowland-Bach. Also elected were officers Michael Faust with Conoco-Phillips as vice president; Jeremy Albright with Welltec as treasurer and Deidre Gross of Global Marine as secretary. The membership elected six directors to the board. For two-year terms: Paul Mazzolini of Hilcorp, Eric Wieman of Peak Alaska and Lennie Dees of Alaska Department of Revenue. One-year terms were Eileen Simmons of Artic Catering, Tom Hendrix of Carlile and Tom Redmond of Solsten. The annual meeting attendees recognized Harvey Doughtery as the oldest past President at age 84 years. Members also recognized Ron Trevithick for his outstanding service and support to the club over this past year. He is not only a past board member but a financial consultant for the club. The following were elected to serve as Officers on the 2016 Alaska Association of Realtors board of directors. President: Dave Somers, Somers and Associates, Fairbanks; president-elect: Devon Thomas, Century 21 Realty Solutions, Wasilla; vice president: Ava Anderson, Jack White Real Estate, Anchorage; secretary/treasurer: Don McKenzie, Re/Max Dynamic Properties, Anchorage; past president: Angie Tallant, Somers and Associates, Fairbanks; directors-at-large: Michael Droege, Century 21 Realty Solutions, Anchorage, and Anneliese Cooper, Core Real Estate Group, Eagle River. Gov. Bill Walker has appointed the state attorney general to the Alaska Permanent Fund Corp. board. Craig Richards is replacing Larry Hartig, who is commissioner of Alaska’s Department of Environmental Conservation. Hartig was appointed to the board in 2009. In a statement, Walker said he appointed Richards because of his extensive financial experience. Among other things, Walker noted that Richards practiced in the fields of public finance and project development for much of his career and that he has a Master of Business Administration from Duke University. The corporation’s board consists of six members appointed by the governor. It sets policy for the corporation. By law, two of the board members must be heads of principal state departments: the Revenue commissioner and another cabinet member chosen by a governor.

Alaska goes full year without fishing fatality for first time

The deadliest catch is getting a lot less deadly. Last week, the U.S. Coast Guard reported to the North Pacific Fishery Management Council that for the first time in known history, no one died on the job while commercial fishing in Alaska during the last federal fiscal year, which ended Sept. 30. “This is the first year, going back as far as we have records, that we didn’t have what I’ll characterize as an operational-related death,” said Coast Guard Capt. Phillip Thorne, chief of enforcement for the Coast Guard in Alaska. That claim comes with a few caveats, said Dr. Jennifer Lincoln, who monitors fishing deaths in Alaska for the National Institute for Occupational Safety and Health. “It’s a case definition issue,” she said. “Unfortunately, there were still fatalities in the fishing industry as NIOSH would define them.” The Coast Guard’s “operational death” category includes deaths that happen in the act of fishing, but it doesn’t include the deaths of fishermen that happen while a boat isn’t actively working. In most years, that distinction wouldn’t matter. Commercial fishing was for years the deadliest industry in Alaska and the United States, and changing the measuring stick couldn’t change that. It’s one of the reasons the TV series “Deadliest Catch,” which just completed its 11th season following crab fishermen in the Bering Sea, earned its name. Today, salmon fishing — not Bering Sea crabbing — is Alaska’s deadliest catch, and commercial fishing nationwide — and especially commercial fishing in Alaska — is getting safer. In 2005, the year “Deadliest Catch” premiered, 15 people died in Alaska’s fisheries, most when their boats sank. Last year, according to NIOSH figures, just nine people died in Alaska fishing accidents, and the 29 deaths nationwide were the lowest since NIOSH started keeping records in 2000. During the period of the Coast Guard’s claim, NIOSH recorded only a handful of deaths in Alaska. Those include a man who washed up in Kodiak’s harbor, a possible fall overboard in Seldovia, a suicide aboard a fishing boat, and what was either another suicide or a drug overdose. All those cases are still being investigated. “They’re not the kind of events we typically associate with fishing accidents,” Lincoln said. The first definitively fishing-related death took place Sunday when a Kodiak diver was killed while harvesting sea cucumbers in a commercial fishery. Those incidents aside, Alaska’s fisheries are getting safer, Lincoln and Thorne said. “In the United States, the number of fatalities are decreasing; there is a decreasing trend,” Lincoln said. The number of fishermen is declining, which is likely a factor. Many fisheries have been rationalized and consolidated, with quotas in place for individual fishermen instead of an entire fleet. Instead of having boats race out to catch the most fish before the fleet hits its quota, fishing is slower. “It’s allowed fishing vessels to be empowered to make very good decisions about the weather and their operations … and that’s resulted in a safer fleet,” Thorne said. New equipment — winch shutoffs, more comfortable life jackets and better training through groups like the Alaska Marine Safety Education Association — also helps. The Coast Guard has also increasingly emphasized safety exams and on Thursday began mandating them nationwide for every fishing vessel that works more than 3 miles offshore. With more federal fisheries observers required aboard Alaska fishing boats, “we have had a lot of outside drivers that have made our phone ring, and it’s just been fantastic,” said Scott Wilwert, the Coast Guard’s commercial fishing vessel safety program manager in Alaska. Wilwert said about 1,500 boats in Alaska will need an exam, and about 400 still need to get one. There’s also simple chance. While six commercial fishing boats sank between June and September this year, no one was killed. In the past, vessel sinkings have been either the biggest or one of the biggest drivers of fishing fatalities.

Alaska Federation of Natives Award Winners

2015 Citizen of the Year: Fred Lauth, Sr. This year’s Citizen of the Year has dedicated many years to his tribe, demonstrating his commitment to improving the health and prosperity of our Native people. He helped create the Seattle Haida Group that eventually became the dance group, Seattle Haida Laas, and he is known for constantly contributing his carvings and works of art to his community. He donates the majority of his craft. Fred Lauth Sr. was raised in Hydaburg and earned a Bachelor of Arts degree in Business Management with a minor in North West Coast Art from the University of Washington. After graduating, he served as Executive Director of The American Indian Elders of Seattle for five years, and went on to become the CEO of Western Coalition of Alaska Natives (WECAN). In 2008, he was elected to the Board of Directors of Cape Fox Corporation in Saxman, and served as the President until 2014. Fred has been involved with Tlingit and Haida Washington Chapter for over two decades, and served on the CCTHITA Executive Council as one of six Vice Presidents for over five years. Fred has a carving shop, OneHaidaFrog Totems, near the Ballard Bridge in Washington where he carves totems, masks and many other works of art. He is known as a loyal person with a giving heart. 2015 Denali Award: Alex Whiting This year’s Denali Award honoree has revolutionized the way research is done in the Kotzebue area, by always keeping in mind the advice given to him by local Elders and by keeping local residents and tribal members involved. He also makes an effort to learn and regularly use Inupiaq words and phrases, and he make traditional medicine. Alex Whiting is an honorary member of the Native Village of Kotzebue. He has lived and worked in Kotzebue since 1989, and has served for 18 years as the Environmental Specialist at the Native Village of Kotzebue. One of the main goals of his work is to keep local residents and tribal members informed of and actively participating in ecological research and other related projects that happen in the region so that the information is culturally relevant and done in a respectful way that is consistent with lnupiaq values. Alex shares food he harvests with his family and others, and has regularly donated food for the monthly Elders’ potlucks in Kotzebue. He has taken the time to learn and respect the Inupiaq culture and life in rural Alaska, spending as much time hunting and camping as he can. He strives to learn more, and to utilize both the tools of the modern world and the ways of our ancestors to perpetuate the Inupiaq culture by educating others and keeping our environment safe so that we can continue thriving through our subsistence lifestyle. He has successfully integrated traditional and scientific knowledge as a common practice in groundbreaking research projects, most notably through leading ice seal tagging efforts in Kotzebue Sound since 2004. Alex has proposed and advocated for culturally relevant wildlife hunting regulations from an Inupiaq perspective on both the federal and state side. Most recently, he played a large role in changing ADF&G hunting regulations in order to accommodate the way that local residents hunt wolves, wolverines, and caribou on snow machines so that they may continue to harvest the way that they do without breaking any regulations. He did this by drafting the proposal and writing a white paper discussing the cultural perspective behind this method of hunting. President’s Award Honorees Michael E. Swetzof: Culture Bearer Award Michael E. Swetzof was born on St. George Island to Anna Shane and Simeon Swetzof and is married to Sally (Snigaroff) Swetzof of Atka. He was raised in Unalaska, lived in Atka, and recently moved to Anchorage. He has 6 children. Mike was the first president of the Aleut Corporation and served on the board of directors. Dr. Nora Nagaruk: Della Keats “Healing Hands” Award Dr. Nora Nagaruk, Aiyuu, was born and raised in Unalakleet, now resides in Nome with her husband Nathan Nagaruk. As a teenager, she wanted to become a doctor and return to the Bering Strait Region to serve her people. Dr. Barb QasuGlana Amarok: Eileen Panigeo MacLean Education Award Dr. Barb QasuGlana Amarok was raised in Nome, Kotzebue, Wrangell, and Juneau to Mary Ann Amarok Tiffany and Warren Tiffany. She has always had a passion for education, and earned her Bachelor’s degree in Elementary Education, Master’s degree from UAA in Educational Leadership. Suuyuk Lena Hanna: Elder of the Year Award Suuyuk is dedicated to her community, working with her church, Kotzebue Elders Council, Native Village of Kotzebue tribal council and cooking for fundraisers. She is an outspoken Elders advocate, reminding others that Elders are suffering and it is the duty of Inupiaq communities and families to help. Wanda Jean Solomon: Gin’tith (Richard Frank) Military Service Award Sergeant Wanda J. Solomon was born in Kaltag. She attended UAF, moved to Anchorage and obtained a Bachelor’s degree in Business Administration from UAA. With the encouragement of her father, who was a First Sergeant in the Army National Guard, she enlisted in the Air National Guard. Putumiu Brent James Norton: Glenn Godfrey Law Enforcement Award Heroism is defined as “great bravery.” For many in the NANA region, Putumiu Brent James Norton embodies what it means to be a true hero. In July 2015, shots rang out in Selawik. Described as a “rookie, on-call patrolman” by Selawik City Mayor Raven Sheldon, Brent was first to the scene. Carole Huntington: Hannah Paul Solomon “Woman of Courage” Award Carole Huntington and husband Roger have always been active in community service. Married since 1978, the two have dedicated 27 years to managing the Kokrine Hills Bible Camp located on the Yukon River between Tanana and Ruby. Dr. Elise Pletnikoff: Health Award Dr. Elise Pletnikoff is happy to be practicing medicine in her hometown. Born in Sand Point, she grew up Kodiak, spent summers fishing in Sand Point and Chignik. Attending Kodiak schools, she was interested in medicine early on. She was interested in science and wanted to be a doctor since she was seven. Clarence Wood: Katie John Hunter-Fisher Award Clarence Wood is the son of the late Luke and Grace Wood of Ambler. Today he lives with his wife Hannah in Ambler where much of his time is spent harvesting and gathering for his family and village. He was married to the late Marie Wood and together they raised 15 children. Agga Chloe Naylor: Lu Young Youth Leadership Award Leadership is not defined by age; it is defined by actions. Agga Chloe Naylor’s actions to help the community of Kivalina after their only store burnt to the ground in December 2014 demonstrates the selfless work of leadership. Raised in Kotzebue, Naylor’s path to service began at a young age. Louise and Lee Kadinger: Parents of the Year Award Lee and Louise Kadinger have 7 children and 4 grandchildren. They provided foster care for 10 Native children over the years, three of which they adopted. Given the many special needs of their children, their approach to parenting is rather simple—love, compassion, and understanding. Andy Teuber: Public Service Award Andy Teuber serves as the Chairman and President of the Alaska Native Tribal Health Consortium, a position he has held since 2008. Teuber has also served as the President/CEO of the Kodiak Area Native Association since 2006. He is an enrolled member and President of Tangirnaq Native Village. Byron Nicholai: Roger Lang Youth Leadership Award Byron Nicholai is the son of David and Dora Nicholai of Toksook Bay. Byron is highly active in keeping his traditions and culture alive by promoting singing and drumming in his Native language. He has traveled throughout the states and recently performed for U.S. Secretary of State, John Kerry, in Washington, D.C. Kristi Skaflestad: Small Business Award Located in the small fishing town of Hoonah, the Chipper Fish is a seafood eatery owned by chef Kristi Skaflestad. She is of Aleut and Tlingit decent. She is from the T’akdeintaan Clan. She graduated from Le Cordon Blue’s Western Culinary Institute in Portland, Oregon. Phillip Albert, Jr.: Dr. Walter Soboleff “Warrior of Light” Award Phillip Albert, Jr. was born in Tanana, raised in Kokrines and Ruby with traditional Athabascan values of respect for others and land, hard work, sharing, caring, cooperation and self-sufficiency. His family lived a subsistence lifestyle, up until early adulthood when a winter accident while trapping, requiring that both his feet and fingers on both hands be amputated.

More, smaller icebergs may show up in Alaska tanker lanes

Icebergs that threaten tankers carrying oil from the trans-Alaska pipeline are likely to be smaller but more numerous over the next two decades, according to a study by a citizens oversight group. Ice that calves off the Columbia Glacier near Valdez has to travel farther to reach shipping lanes because the glacier has receded more than 10 miles since 1980, according to the report prepared for the Prince William Sound Regional Citizens’ Advisory Council. The longer distance to Prince William Sound means icebergs have more opportunity to shrink from melting and fracturing. Ice remains a serious threat, however. Smaller icebergs can more easily clear an underwater barrier, the glacier’s terminal moraine, which grounds the largest icebergs leaving Columbia Bay. The smaller icebergs that can float over the moraine will continue to be a hazard, said Mark Swanson, director of the council. “It’s going to pose a risk for shipping for the foreseeable future,” until the glacier finally retreats out of the ocean and onto land, he said by phone from Valdez. The citizen’s council was created in the aftermath of the grounding of the Exxon Valdez, a 987-foot tanker that struck Bligh Reef on March 24, 1989. The Exxon Valdez spilled roughly 11 million gallons of crude oil. It was the nation’s largest oil spill until the 2010 Deepwater Horizon blowout in the Gulf of Mexico. The crew of the Exxon Valdez had received permission to stray from shipping lanes to avoid Columbia Glacier ice. “They just forgot to turn back and then they found a reef,” Swanson said. “They avoided one hazard and found another.” An iceberg figured into a second tanker incident five years later. The 894-foot Overseas Ohio, heading north to pick up oil, struck an iceberg head-on. The collision tore a 17-by-20-foot hole in the vessel’s bulbous bow. Icebergs that ride low in the water, weighed down by rock, are hard to see. “Those are the ones that could really booger up a ship,” said Swanson, a former Coast Guard officer who was captain of the port in Valdez from 2002 to 2005. The trans-Alaska pipeline these days carries an average of 496,571 barrels of Alaska North Slope crude oil per day. Tankers carry the oil to West Coast refineries. Advancing glaciers flowing into the ocean gouge a deep trench and push forward a wall of rock and debris on which ice rests. As the Columbia Glacier has retreated, that underwater terminal moraine has acted as a barrier to big icebergs near the head of Columbia Bay. The moraine is 60 feet deep at its deepest point. In the past, Swanson said, large icebergs would run aground on the moraine and clog the movement of icebergs. The study by W. T. Pfeffer Geophysical Consultants LLC revealed that that height of the moraine has not been affected. However, many more icebergs are simply floating over it. Shipping lanes begin 12 miles east of the bay. The Coast Guard manages ice risk with 24-hour radar. Five of the escort tug boats dispatched to accompany tankers in and out of Valdez are equipped with radar that can detect ice. “There are probably 50, 60 days per year when tanker traffic is in some way restricted based on ice hazards,” Swanson said.

Study: Highway runoff kills salmon but filters can help

SEATTLE (AP) — Toxic runoff that flows from highways into urban streams is killing coho salmon in Puget Sound, but simple filtering methods can help fish survive, a new study finds. Salmon exposed to untreated highway runoff in controlled experiments became lethargic, lost their orientation and died within hours, according to the study published Oct. 8 in the Journal of Applied Ecology. But fish survived if they were immersed in runoff that had been filtered through columns of sand and soil, similar to rain gardens. The study found inexpensive pollution-prevention tools that completely prevented the toxic impacts to the fish, said Julann Spromberg, the paper’s lead author and toxicologist affiliated with the National Oceanic and Atmospheric Administration in Seattle. All fish exposed to untreated highway runoff died within 24 hours, while fish exposed to the treated water survived. Spromberg said she was most surprised to find that the fish weren’t affected by an artificial mixture of heavy metals and oils that the researchers produced in the lab. But actual runoff collected from a Seattle highway caused the fish to die. Heavy metals and oil products weren’t enough to kill fish, she said. “There’s something out there that we’re not measuring that’s causing it,” but scientists haven’t pinpointed what chemical or compound of chemicals in the runoff is lethal to salmon, she added. Knowing that may help control toxic chemicals at its source, she said. Rick Cardwell, an aquatic toxicologist not involved in the study, praised its findings. “This is really a good study that really would have a lot of impact,” he said, though would like to see the experiments independently repeated. In the meantime, the study suggests that rain gardens, bioretention swales and other so-called green stormwater infrastructure that manage stormwater with natural drainage should be incorporated where possible. Nat Scholz, who manages NOAA’s Ecotoxicology Program in Seattle, said wild salmon may have a shot if such strategies are used. The study included researchers from NOAA Fisheries, U.S. Fish and Wildlife Service, Washington State University and the Squamish Tribe.

Movers & Shakers 10/25/15

Jason Langen, PLS, has joined the R&M team as the land survey manager. Langen is a graduate of Huntington College and has more than 13 years of experience as a Professional Land Surveyor. He has worked on various projects throughout Alaska and his background includes construction surveying, bathymetric surveying, cadastral surveying, boundary surveys, topographic surveys, GPS surveys, project management, quantity calculations, and QA/QC procedure development just to name a few. In his new role at R&M, Langen will be responsible for the general oversight and development of the R&M Survey Department. Dawn Kimberlin has been promoted to vice president of marketing and communications for NANA Management Services. NMS, the fifth-largest private employer in Alaska, has provided services to the North Slope for 40 years. Kimberlin started with NMS as director of marketing, Lodging Division, in 2009, and moved to director of marketing, Food and Facilities Management Division. She most recently served as director of marketing and communications for the company, managing strategic projects across NMS’ five divisions. After beginning her marketing communications career at NANA Development Corp. in 1999, Kimberlin worked as an account manager at an advertising agency, community relations manager at CIRI, and public relations manager at the Alaska SeaLife Center. Kimberlin earned an MBA from Alaska Pacific University and bachelor’s degree in psychology from the University of Texas at San Antonio. In 2012, she received a Native American 40 Under 40 Award from the National Center for American Indian Enterprise Development. Kimberlin is a shareholder of NANA Regional Corp. Inc. and Doyon Limited. The Alaska Travel Industry Association, Alaska’s statewide professional trade association for businesses and individuals involved in the visitor industry, announced its 2015 Visitor Industry Awards recipients presented during the annual ATIA Convention in Juneau. The winners are: Alyeska Award, Alaska Airlines Magazine Alaska; Chuck West Award, Alaska Skylar Travel; Denali Award, Clark Mishler; Lifetime Achievement Award, Ann Campbell; Spirit of Alaska Award, Holland America Line; Stan Stephens Stewardship Award, Kirk Hoessle; Visitor Industry Hall of Fame Award, Mary Helen Stephens. The Board of Governors of the Federal Reserve System has appointed Cook Inlet Region, Inc. President and CEO Sophie Minich to the Seattle Branch board of directors, effective Sept. 1. CIRI’s business lines include energy development, oilfield and construction services, real estate, and tourism and hospitality. CIRI is Southcentral Alaska’s largest private landowner with approximately 1.3 million acres. Other land holdings are located in Texas, Arizona, California and Hawaii. CIRI has approximately $1 billion in assets. Minich joined CIRI in 1993, shortly after graduating from the University of Alaska Anchorage with a degree in finance. She has held various positions of increasing responsibility and was appointed to her current position in January 2013. Minich is on the board of the Anchorage Economic Development Council as well as a Trustee of Alaska Regional Hospital, and CIRI Elder’s Trust. Poldine Carlo of Fairbanks was presented the 2015 Shirley Demientieff Award at the annual Alaska Federation of Natives Convention in Anchorage. Born in Nulato in 1920, Poldine Carlo was raised by her grandparents, Joseph and Anna Stickman. Throughout her life, she has been a true Koyukon Athabascan culture bearer, passing on the language and native values that are deeply important to her. In 1978, Poldine wrote “Nulato: An Indian Life on the Yukon”, which tells the story of her life as a young Athabaskan woman growing up in the 1920’s and 1930’s. Poldine is the proud mother of eight children and many grandchildren, and at the age of 94, attends every board meeting for the Fairbanks Native Association, Doyon Ltd., and Denakkanaaga. Wells Fargo is honoring Romig Middle School math teacher John Bruce as 2015 Alaska Teacher of the Year on its 116 ATMs across the state. From now through Nov. 4, Wells Fargo’s ATMs will feature a screen congratulating Bruce with details about his teaching achievements. Paddy Coan, GRI, CRS, manager of the Wasilla branch of Jack White Real Estate, was named the recipient of the Alaska Association of Realtors “2015 Realtor of the Year” award at the AAR State Convention in Homer on Sept. 30. This distinguished award is given annually to the individual who has displayed a strong sense of realtor spirit, leadership qualities with local, state and national associations of realtors and involvement in civic activities. KPMG LLP has promoted Daniel Mitchell to managing director of its Anchorage office. A member of the audit practice, Mitchell specializes in providing audit and accounting services to Alaska Native corporations and financial institutions. Mitchell is a graduate of the University of Alaska Anchorage. He leads KPMG’s Anchorage office recruiting efforts and works extensively with the UAA Schools of Business and Management and career offices. Bryan Uher has been appointed interim director of the Interior Alaska Campus at the University of Alaska Fairbanks. Uher, IAC’s administrative manager, replaces Teisha Simmons, who is leaving for a position at Tanana Chiefs Conference. A search will be launched this spring for a full-time director. Uher has been with IAC for 14 years. He started as a student assistant at the age of 18. He has worked in program coordination, student services oversight, technology support and partnership development. He graduated from UAF with an associate degree in applied business (marketing) and a bachelor’s degree in rural development. He is pursuing a master’s degree in public administration from the University of Alaska Southeast and attending Leadership Fairbanks through the Fairbanks Chamber of Commerce. The recipients for the Bill Bivin Small Business of the Year, Local Chamber of Commerce of the Year, William A. Egan Alaskan of the Year and North Star Award were announced on Oct. 14 at the Alaska Chamber’s annual Awards Gala in Fairbanks. Date-Line Digital Printing is the recipient of the Bill Bivin Small Business of the Year award. The Fairbanks-based partnership of Geoff Welch and Travis Lewis exemplify the community commitment of Alaska small businesses. Date-Line is notable for the “Thanks Fairbanks” program, sharing thousands of free Thank You cards with Fairbanks community. The Kenai Chamber of Commerce and Visitor Center is the recipient of the Local Chamber of Commerce of the Year award. Established in 1954 and predating statehood, the Kenai Chamber is an active advocate on business issues effecting local community and the state. Charles “CB” Bettisworth is the recipient of the celebrated and prestigious William A. Egan Alaskan of the Year award. Born and raised in Fairbanks, Bettisworth has inspired a new generation of architects. The Chamber presents the North Star Award to an individual or organization in Alaska who actively develops and pursues the betterment of all Alaska residents. The Chamber presented this rare honor to outgoing Alaska Chamber President and CEO Rachael Petro.

GUEST COMMENTARY: A new — and improved — Northern Forum is necessary

The Northern Forum — a nonprofit, international association — was formally established in 1991 with eleven regional members from nine northern countries. Its intent upon forming was to improve the quality of life of northern peoples by providing northern regional governments a means to share their knowledge and experience in addressing common challenges.  As Gov. Bill Walker resumes talks with the Northern Forum, we wanted to remind Alaskans of what the Forum is, and more importantly, what it could be. All inaugural members agreed that the future held boundless potential for the Arctic and that together, the northern regions could overcome the challenges that each were facing. They hoped that the Forum would generate international awareness, respect and legitimacy for the issues northern communities face. While in its early years the Northern Forum certainly accomplished this, the reality is that the Forum’s efficacy has waned in the recent past. The creation of the Arctic Council in 1996 certainly had a lot to do with this, as eight nations came together to address sustainable development and environmental protection. The inclusion of Permanent Participants, who represent indigenous groups, in that body, as well as the increase in observer states and organizations over the years, resulted in the Arctic Council becoming the face of the Arctic in the public’s mind. Even as the Arctic Council has moved forward as the intergovernmental forum in the Arctic, so have increasing calls for more local input, regional participation, and inclusiveness. That said, the Arctic Council will remain the focal point for international cooperation into the future, even as the future of Arctic governance truly rests in the concerns and capabilities of local or regional collaboration, which is where the Northern Forum has a greater role to play. Without formal and active engagement between the Arctic Council and the Northern Forum, efforts by either to address the economic, living, cultural and environmental conditions of northern peoples will fall flat. In place of repeated calls for the Arctic Council to open its doors and for inclusion and transparency, we argue that that the current capabilities within the Northern Forum be harnessed to address this gap. The Northern Forum is already an “observer organization” to the Arctic Council and provides the means for regional inclusion and local investment in the Arctic Council. The challenge is to fully realize that potential. We hope that the states, territories and other regional governments of the North can come together in a “New Northern Forum.” A Northern Forum with full participation across the Arctic, with active leadership from northern governors and premiers, and with robust participation in the Arctic Council would bring the reality, richness and responsibility of the Arctic back to the peoples of the Arctic. It will take careful leadership from current and potential Northern Forum members to right the ship and steer it through this uncharted territory. It will take intentional collaboration between regional governments — each of which have pressing domestic concerns — but the long-term benefits will outweigh the costs as together northern peoples articulate very clearly shared and individual perspectives and priorities, and work to bring these and local assets into the outcomes of the Arctic Council. At the same time, there are best practices that the Northern Forum can apply in the short term that will resonate with a broader membership and make its actions more effective. These include: • Establishing a regional Secretariat in North America, the Nordic Arctic and Russia that can support a diverse membership • Lowering membership fees to better attract regional governments, even as increased outreach is conducted to bring in local governments and the business community • Developing and implementing a strategic plan that corresponds to the vision of northern governors, premiers and regional policymakers A New (and Improved) Northern Forum has the potential to fully represent northerners in the policy-relevant discussions taking place at the Arctic Council. This step will also help realize the Arctic Council as a “model of cooperation” even as it advances local governance, which will be a critical element of the future of the Arctic. Alaska’s Governor — and others — will need to act to fully leverage this opportunity. They can do this by working together within the Northern Forum structure, reinvigorating and investing in this body in a way not seen since Gov. Hickel. The founding members of Northern Forum included: Yukon; Heilongjiang Province; Lapland; Hokkaido; Dornod, Mongolia; Trondelag and Tromso, Norway; Chukotka Autonomous Okrug and Magadan Oblast, Russian Federation; the Republic of Korea; and Alaska. Alaska State Sen. Lesil McGuire is the current co-chair of the Senate Special Committee on the Arctic and the former co-chair of the Alaska Arctic Policy Commission.  During her tenure as president of the Pacific Northwest Economic Region she established the Arctic Caucus where she serves as co-chair. Nils Andreassen is the executive director of the Institute of the North, an independent nonprofit organization whose mission is to inform public policy and cultivate an engaged citizenry. The Institute has a legacy working on Arctic infrastructure priorities and policies that serve to strengthen and connect northern communities. 

Marine Highway System may explore selling Taku ferry

If the state’s budget outlook remains unchanged, the Alaska Marine Highway System will begin investigating whether to surplus the state ferry Taku in the next six months. “Right now, we’re looking at the Taku first, and that’s why we put it out of service,” said Capt. John Falvey, general manager of the ferry system, in a telephone interview on Oct. 9. The state hasn’t hit that point yet, Falvey stressed, saying it’s a “conversation that’s got to happen at high levels.” Falvey said he and Michael Neussl, deputy commissioner of the Alaska Department of Transportation, have discussed what’s next for the Taku, and “everything from selling it to trying to run it again” is on the table. A final decision on the fate of the Taku would sit with DOT Commissioner Marc Luiken, according to Falvey. During a presentation to Southeast Conference in September, this year held in Prince Rupert, British Columbia, Neussl said he believed the ferry system would sustain itself by reducing the size of the fleet. “I think the numbers are speaking that we can’t afford to operate an 11-ship fleet with the frequency of service that we’ve kind of become accustomed to,” Neussl said on Sept. 15. Getting rid of the ship has its own costs. The state could surplus the vessel or scrap it, but scrapping the Taku comes with clean-up costs. “We’re not driving forward in earnest to start writing reports or starting to look at the cost of one thing compared to another,” Falvey said. The Taku would be on the block before others because it’s the smallest of the system’s mainliners, he said. As the state’s budget forces the system to cut service and take ferries out of service, the ferries that are operating will run closer to capacity. “It’s a fine line between cost savings and the ability to generate revenue with bigger ships,” Falvey said. “We looked a lot at that before we decided to take Taku out of service.” The Taku is in layup status for the winter. The ferry system’s proposed 2016 summer schedule calls for the mainliner to remain there through Sept. 30. There’s eight weeks of paperwork, an overhaul and maintenance work between its current state and the 52-year-old Taku’s return to service, according to Falvey. Its layup status in the First City will save the system cash through the winter as a “hotel ship,” Falvey said, meaning it will board the crew of other ferries going through maintenance at the Ketchikan Shipyard. The Taku’s certificate of inspection was set to expire in July, according to the U.S. Coast Guard. The vessel was put into an inactive status before the expiration date, Falvey said, which allows the vessel to come back online faster than it would had it lost its certificate. “We took those extra steps to give ourselves that margin of safety should the boat run again — and maybe it will,” Falvey said. The Taku will stay in Ketchikan through the winter and will most likely remain at the state berth throughout its 2016 layup. It sailed within the Inside Passage, from Prince Rupert, British Columbia, to Ketchikan, Wrangell, Petersburg and Sitka and on to Juneau and Skagway. It was sidelined earlier this year because of a backlog of maintenance work on the Matanuska and the Malaspina. The Taku, built in Seattle, is designed to carry 350 passengers, 69 vehicles and a crew of 42. It will carry a crew of 11 in layup. Most of the positions on the vessel, one of the original three that created the ferry system, were cut between July and August. The Taku is one of three ferries that meets international safety of life at sea requirements, which allows it to dock in Prince Rupert. The Matanuska and the Kennicott also have the SOLAS classification.

Low gas prices mean no Social Security increase next year

WASHINGTON (AP) — For just the third time in 40 years, millions of Social Security recipients, disabled veterans and federal retirees can expect no increase in benefits next year, which is unwelcome news for more than one-fifth of the nation’s population. They can blame low gas prices. By law, the annual cost-of-living adjustment, or COLA, is based on a government measure of inflation, which is being dragged down by lower prices at the pump. The government is scheduled to announce the COLA — or lack of one — on Oct. 15, when it releases the Consumer Price Index for September. Inflation has been so low this year that economists say there is little chance the September numbers will produce a benefit increase for next year. Prices actually have dropped from a year ago, according to the inflation measure used for the COLA. “It’s a very high probability that it will be zero,” said economist Polina Vlasenko, a research fellow at the American Institute for Economic Research. “Other prices — other than energy — would have to jump. It would have to be a very sizable increase that would be visible, and I don’t think that’s happened.” Congress enacted automatic increases for Social Security beneficiaries in 1975, when inflation was high and there was a lot of pressure to regularly raise benefits. Since then, increases have averaged 4 percent a year. Only twice before, in 2010 and 2011, have there been no increases. In all, the COLA affects payments to more than 70 million Americans. Almost 60 million retirees, disabled workers, spouses and children get Social Security benefits. The average monthly payment is $1,224. The COLA also affects benefits for about 4 million disabled veterans, 2.5 million federal retirees and their survivors, and more than 8 million people who get Supplemental Security Income, the disability program for the poor. Many people who get SSI also receive Social Security. Carol Mead of Montrose, Pennsylvania, said she and her husband were counting on Social Security COLA to help them with their finances. “My husband is working just so we can pay our bills,” said Mead, a retired land-use administrator. “He’s 70 years old, and he’s still working in a stone quarry. He’s told me a number of times that he thinks he’s going to have to work until the day he dies.” More bad news: The lack of a COLA means that older people could face higher health care costs. Most have their Medicare Part B premiums for outpatient care deducted directly from their Social Security payments, and the annual cost-of-living increase is usually enough to cover any rise in premiums. When that doesn’t happen, a long-standing federal “hold harmless” law protects the majority of beneficiaries from having their Social Security payments reduced. But that leaves about 30 percent of Medicare beneficiaries on the hook for a premium increase that otherwise would be spread among all. Those who would pay the higher premiums include 2.8 million new beneficiaries, 1.6 million whose premiums aren’t deducted from their Social Security payments, and 3.1 million people with higher incomes. Their premiums could jump by about $54 a month; the jump could be more for those with higher incomes. States also would feel a budget impact because they pay part of the Medicare premium for about 10 million low-income beneficiaries. All beneficiaries would see their Part B annual deductible for outpatient care jump by $76, to an estimated $223. The deductible is the annual amount patients pay before Medicare kicks in. “This would affect all beneficiaries,” said Tricia Neuman of the nonpartisan Kaiser Family Foundation. “This kind of an increase is unprecedented.” Senate Democrats have introduced legislation that would freeze Medicare’s Part B premium and deductible for 2016, but its prospects are uncertain. White House spokeswoman Katie Hill said: “We share the goal of keeping Medicare’s premiums affordable, and are exploring all options.” By law, the cost-of-living adjustment is based on the Consumer Price Index for Urban Wage Earners and Clerical Workers, or CPI-W, a broad measure of consumer prices generated by the Bureau of Labor Statistics. It measures price changes for food, housing, clothing, transportation, energy, medical care, recreation and education. The COLA is calculated by comparing consumer prices in July, August and September each year with prices in the same three months from the previous year. If prices go up, benefits go up. If prices drop or stay flat, benefits stay the same. The numbers for July and August show that, overall, consumer prices have fallen since last year. Fuel prices are down by 23 percent from a year ago, according to the August inflation report. But prices for some other goods and services, such as health care and housing, are up. Advocates argue that the government’s measure of inflation doesn’t accurately reflect price increases in the goods and services that older Americans use. “The COLA is determined by the buying power of younger working adults,” said Mary Johnson of The Senior Citizens League. Many advocates for seniors want Congress to adopt an experimental price index that seeks to capture the inflation experienced by Americans 62 and older. The Social Security Administration estimates it would increase the annual COLA by an average of 0.2 percentage points — which still might not be enough to generate a COLA for next year. Lee Marshall of Greenville, California, said the current inflation index isn’t good enough. “They have a formula that they use that doesn’t reflect the actual cost of living,” said Marshall, 68, a retired laborer and casino dealer. “Just because the price of gas is going down, that doesn’t mean anything.”

The Bookworm Sez: Leading from the heart

If anybody asks, you’ll tell ‘em straight: you love your job. It’s perfect for you, and it takes advantages of your strengths. That’s plenty to love, although there are times when you wonder if it could be even better. According to author Tommy Spaulding, you might be surprised — and in his new book “The Heart Led Leader,” he explains. Changing your life and your organization, says Spaulding, is an 18-inch journey. That’s approximately how far it is from your brain to your heart. But by heart, he doesn’t mean the thing that pumps your blood, and he says he’s not being “touchy-feely.” Spaulding believes that love is at the very basis of every successful organization, and cultivating an unselfish desire to do good for others is integral to leadership. How many businesspeople do you know, for instance, who make it a point to know a little bit about each of their employees? Spaulding introduces readers to CEOs who do, and he explains how that genuine interest and compassion drives results in attainment, shareholder success, sustainability, and bottom lines. He tells stories about how love changed the cultures — and profitability — of formerly-failing companies. And he writes about one entrepreneur who forgave big, and the lives it changed. It’s all about relationships, he says, and one statement sums up everything: “do right.” It also helps to know who you are, who you serve, and who you love. That knowledge, says Spaulding, will make you a “Who Leader” and will further your path to become a Heart Led Leader. Other things to take with you: openness, which Spaulding claims works in places other than business; humility, which helps you think of others more; and emotional vulnerability, which allows others to be vulnerable, too. Have a keen passion for what you do and display it to your employees and customers. Practice selflessness by never losing sight of the overall team. Be someone who’s genuine. Have (and demonstrate) faith in yourself and those who work for you. Show empathy to employees by remembering that they have hard times, too.  Learn to forgive.  Offer encouragement. Be honest. Oh, I tried so hard to like this book. I really did. Instead, “The Heart Led Leader” kind of made me squirm: despite author Tommy Spaulding’s assurances that his method isn’t new-agey-touchy, I sure did feel like it was. Yes, I’ll admit that some of what Spaulding espouses is sound. Employees do appreciate caring bosses, and they’ll tend to emulate CEOs with passion. I can’t imagine having a workplace without dignity or authenticity, and every business owner in the world understands the importance of good relationships. But there are limits, I think, and this book tiptoed pretty close to there. The advice is good, in other words, but I question the open emotions-forward methods. I think what’s inside this book may certainly work in some places. In others, definitely not, and readers should be watchful of that. “The Heart Led Leader” may turn your business around — or you may not love it one bit. Terri Schlichenmeyer is the author of The Bookworm Sez, which is published in more than 200 newspapers and 50 magazines throughout the U.S. and Canada. Schlichenmeyer may be reached at [email protected]


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