Business leaders pool funds to plan Anchorage economy

Anchorage government and business leaders hope a report now being compiled will provide ideas to add jobs and diversify the city’s economy.This summer authors of the economic development plan are conducting research and interviews for a final report due in September.A 36-member committee of Anchorage business leaders hired Chabin Concepts of Chico, Calif., to conduct research in the city and compose an economic-development strategy.Using the final report’s recommendations, business and city leaders can endeavor to help existing businesses to grow and attract new businesses, said Rick Morrison, committee chairman. Another goal is to add jobs paying above-average incomes in Anchorage, he said.Committee members aim to build a sustained Anchorage economy rather than one dependent on federal funds or major projects, said Morrison, a 28-year resident who owns EERO Volkswagen and Saturn of Anchorage."If we can create a compelling vision for it, this could be the biggest thing since discovering oil because we could come up with ways to create business," he said.The committee started the effort with help from the Anchorage Chamber of Commerce, the Anchorage Economic Development Corp. and the Municipality of Anchorage.AEDC contracted Chabin Concepts to compile the report under a $225,000 contract, Morrison said. That figure includes $125,000 from the city plus private donations, he said. Overall, the committee has raised about $300,000 in private donations, Morrison said. Besides the cost of the report, the committee expects to spend up to $150,000 for marketing and other costs, he said.In May, Chabin Concepts released the first of seven reports, which will be followed by a final economic development plan. The consulting firm interviewed Alaska business people and studied federal and state statistics. Chabin Concepts’ 26-page findings show that dominant industries like oil and seafood are now declining.Other findings include: Anchorage accounts for almost 40 percent of the Alaska population and nearly 50 percent of state jobs. Manufacturing jobs in Anchorage represent fewer than 2 percent of total jobs; nationally, manufacturing jobs account for about 14 percent of all jobs. In the municipality, one in 15 jobs is with the military. Government is the city’s largest employer, followed by services and retail trade. Enrollments and degrees awarded at the University of Alaska Anchorage are declining. Alaska’s innovative capacity and investment trails other states with a low number of patents, venture capital, and science and engineering graduate students per capita.Upcoming reports will analyze and list Anchorage’s strengths and weaknesses, competing cities, target industries and a marketing strategy.Leslie Parks, a Chabin Concepts partner, said the company conducted 40 interviews with public and private sector organizations involved in economic development. Focus groups discussed issues related to business and industry, environment, international, logistics and transportation, high-technology and work-force education.Chabin Concepts wrote a similar plan for Honolulu, which is now using those ideas, Parks said.Parks is now preparing a report for Portland, Ore., which is looking to diversify its economy, once dependent on natural resources such as timber, akin to Alaska. However, unlike Anchorage, Portland lacks a major university, she said.The final report should be completed in mid-September, said Larry Crawford, AEDC president and chief executive. The idea for the project started more than a year ago, and the committee first met in November, Morrison said.So far one major result has been uniting committee members, he said.Crawford agreed. The report can show how city groups can work together to boost business, he said. For example, if AEDC is trying to attract a certain industry, then the group could work with the Anchorage Convention and Visitors Bureau to book conventions from that industry, Crawford said.Results also can chart a course for economic development groups in Anchorage."Certainly AEDC will take the report and factor it into our future direction," Crawford said.Morrison anticipates the final report should show potential for developing airport and logistics operations.

Tourism bookings strengthen as industry holds its breath

KENAI -- Nine months after terrorist attacks struck a blow to the travel industry, tourism is trying to crawl back from a near demise. The concern for safe travel may turn out to be a boon to Alaska and, in particular, the Kenai Peninsula travel market, despite a snail’s pace start in the booking season.Alaska Travel Industry Association spokesman Mark Morones said some work may help ease a rut that the Alaska tourism industry has slipped into of late."The tourism industry in Alaska has been a growth industry, and that growth is slowing down," he said. "We (are) trying very hard to encourage people within the state to travel and take advantage of all the things there are to see up here."He said ATIA is attempting to shift the focus of its marketing strategy accordingly, with a recent "Find Your Alaska" promotion running on TV and a Web site in the past months."We were offering Alaska resident specials," Morones said. "We’re trying to basically encourage our members to offer discounts to Alaska residents. We had about 34 members who participated in this go-around."Homer expects to fare well from Alaskans visiting the state. Derotha Ferraro, executive director of the Homer Chamber of Commerce, said this is a trend for the city, which is right on course for a successful season."So far, so good," she said. "Homer is a repeat destination. We’re a pretty safe bet. Our No. 1 visitors are Alaskans."Alaskans tend not to make reservations. If the weather is good, they come."Jay Barrett, director of communications for the Kenai Visitors and Convention Bureau, said the late start to the season gave many doubts. But he said he is looking forward to more vacationers arriving as the season goes on."We’re very optimistic," he said. "Although spring might be a little late, the visitors seem to be on time."An ATIA survey conducted in March found a 12 percent drop in travel inquiries and a 13 percent drop in bookings compared with the same time last year. These numbers, however, were improvements over February and December 2001 figures.Tourism businesses have felt this decline, but many business owners say they still have a positive outlook.Princess Tours spokesperson Tom Dow said his company is expecting some improvement in reservations after a slow start in bookings last fall."Most of the people that we talk to feel much better about the way Alaska is going to go than we did back in the fall," Dow said. "The challenge is making up for last fall, where you usually start getting some early business on the books."Tim Worthem is chief executive of Premiere Alaska Tours of Anchorage, a company that operates charter buses from Anchorage to the peninsula. He echoed Dow’s sentiment on playing catch-up on lost reservations."For Alaska, a lot of bookings get planned in the fall," he said. "And that didn’t happen last year. In January, booking picked up, but it’s hard to make up for what you missed."Soldotna Visitor Center Coordinator Shanon Hamrick said progress is in the making."Things were really down at the beginning of the year," she said. "But they’re rebounding."Helen Marrs, Seward Chamber of Commerce executive director, and Kenai Fjords reservation supervisor Sarah Hanson both said the foreign market’s loss is Alaska’s gain."Reservations are up," Hanson said. "Our theory is that all of the people that were going to travel to Europe are going to stay and travel domestic."Marrs agreed, saying cruise ship passengers coming into Seward are equal to last year’s numbers."It seems to be many people are choosing Alaska as a travel destination rather than an overseas trip," Marrs said.Morones said whether tourists will spend money when they arrive is hard to tell. Particularly with so many customers taking advantage of discounted fares, retailers worry that more frugal travelers will be less likely to spend when they come on shore.Those travelers wanting to get here by the road system seem to have more incentive to come now as well, Barrett said."People who are booking RV (recreational vehicle) reservations said their bookings are up over last year," he said. "That’s indicative of the fact that gas prices are lower than last summer, and people are not as eager to fly with security concerns."Joanne Martin, of Diamond M Ranch in Kenai, gave her prognosis of the summer as a whole in the wake of last year’s terrorist attacks."I think it’s going to hurt us a little," she said, "but we’re still optimistic."

Private prison in Whittier joins longs list of dead bills

JUNEAU -- A private prison won’t be going up in Whittier, and Peace Corps volunteers won’t get Alaska Permanent Fund dividends while they’re out of the country.Those proposals are among more than 700 pieces of legislation that died when lawmakers left Juneau.During their two years of work, members of the 22nd Alaska Legislature proposed 924 bills and another 190 generally nonbinding resolutions. They passed 261 bills and 88 resolutions.That’s not unusual, said retired state Rep. Ben Grussendorf, D-Sitka, who once served as speaker of the House."In the time that you have, you have to start doing triage, and get to those that are most important to the largest number of people," Grussendorf said. "Some things are just not going to make it to the gate."And that’s not a bad thing, he said."There’s a lot of pieces of legislation that are introduced that should not become law," Grussendorf said.The Whittier private prison bill was one of the two measures favored by Anchorage oil field services and construction firm Veco that faltered this session. The other was a proposed $760 million tax break to spur construction of a gas pipeline from the North Slope.The prison bill came close to passing. It made it through the House and through most of its Senate committees, but ran into a roadblock in the Senate Rules Committee.Committee Chairman Sen. Randy Phillips, R-Eagle River, said he did not like the bill because the state had not sought bids through a competitive process."I’m not opposed to privatizing prisons, but I do have a real problem with sole source," Phillips said.Proponents of the bill said Whittier had gone through its own competitive bidding process.Sen. John Cowdery, R-Anchorage, tried to revive the prison bill during the special session, but it ended before he could hold a hearing on it.Anchorage Republican Rep. Norm Rokeberg’s bill to set up an insurance pool for nonprofit organizations and small businesses expired in the Senate Health Education and Social Services CommitteeChairwoman Sen. Lyda Green, R-Matanuska-Susitna, said the insurance bill was too complicated to consider with just a week left in the session when it arrived in her committee."That’s a big, big deal," Green said. "That has to be gone over very, very carefully."Green’s committee was also the graveyard for the Peace Corps and Alaska history bills.Nobody’s version of a fiscal plan to bridge Alaska’s anticipated fiscal 2003 budget gap of $963 million passed the Legislature.The House passed bills to raise about $570 million next year through an income tax, use of permanent fund earnings and raising the excise tax on alcohol. The only piece that survived the Senate was the smallest one -- the alcohol tax increase, which is expected to add about $20 million to state coffers.On the Senate side, Finance Co-chairman Sen. Dave Donley, R-Anchorage, largely failed in pushing through legislation he said would reduce spending or help constrain the growth of government.Several of his proposals would have saved money by trimming programs that benefit rural Alaska, and House Community and Regional Affairs Co-chairman Sen. Carl Morgan Jr., R-Aniak, refused to hear them.Donley’s proposed constitutional amendment to limit state spending also never made it to the House floor. In fact, lawmakers declined to put any constitutional amendments on this fall’s election ballot.Alaskans also will continue to set their clocks forward in spring and back in the fall. A proposal to eliminate daylight savings time died in the House Rules Committee.

Kasilof man delights customers with sausage from salmon

KENAI -- Coming soon to a ballpark near you: dogfish dogs?Fred West, owner of Tustumena Smokehouse, has perfected a technique for making polish sausage, bratwurst, pepperoni and breakfast sausage entirely from pink, chum or "dog," and sockeye salmon. And judging from the reaction he’s been getting from customers, the product is bound to be a hit."I didn’t even know it was fish. I think it’s just great. I was just amazed," said Kelly Johnson while buying several packs of polish sausage to bring with him on a trip Outside. Johnson said he heard about the sausage when a friend of his offered him a piece of the fish sausage earlier this year. He said he was hooked from the beginning."It brought me out here, didn’t it?" he said.West has been perfecting his technique for making the sausage for about seven years now. He said he got started on the idea out of curiosity."The reason I got into this is I just like to experiment around," West said recently from his store in Kasilof.He said what started out as a hobby quickly became an idea to save his business."Over the last four years I’ve been sending samples out. Now I’m getting a lot of interest. What started as an experiment has become survival, it’s as simple as that," said West, noting that conventional salmon products have seen retail prices plummet in recent years."It’s an innovative product, and it’s a value-added product," he said.Don’t think that since West uses mainly pinks and chum, traditionally the least expensive salmon, his product isn’t high quality. He said he only uses fish that have been properly handled."It has to be good fish. The fish has to be bled and iced and kept at the highest quality or I won’t buy them. It has to be a top-notch, quality fish. You can’t make silk out of a sow’s ear."That quality is what West is hoping will catch on with consumers. He said he’s already been contacted by at least three major chain retail stores inquiring about his product. He said they are intrigued by the potential for the growth of the sausage product."One buyer called and said, ’Fred, how much can you produce?’ We’re really excited."West’s salmon sausage currently is only available through the Tustumena Smokehouse. However, West said plans are under way to distribute his product locally."You can use it in anything, really. It’s good in soups, stews, scrambled eggs, omelets, pizza, and you’d never know it’s fish."West also noted he could never have developed his product without the help of lots of friends, fishermen and even government officials.As a customer, Johnson agrees West’s sausage is good for the community as a whole."Every time I turn on the radio or pick up the news, all I hear about is how there’s no money. What I want to hear is entrepreneurial stories like this. You should be proud of yourself," he told West.Then Johnson opened a fresh pack sausage and took a bite."I think it’s great," he said.

Adak transfer to Aleut Corp. one step closer

The huge wheels of the federal government grind ahead, slowly inching forward the process that will turn a former Navy installation in Alaska over to a regional Native corporation.While the U.S. House authorized the transfer of the Adak Naval Complex to the Aleut Corp. in its version of the 2003 Defense Authorization Bill, a Senate bill on the same topic was taken up by a subcommittee of the Senate Energy and Natural Resources Committee.The bill, sponsored by Sen. Frank Murkowski, R-Alaska, ratifies an agreement reached among the Navy, the Aleut Corp. and the U.S. Fish and Wildlife Service to convey title of the base to the Native corporation in exchange for land rights being transferred to the Wildlife Service. The Navy facility was closed by recommendation of the 1990 Base Closure Commission.Under the terms of the agreement, 47,150 acres -- including an airfield, an entire town and one of the Pacific’s best deep-water ports -- would be transferred to the Aleut Corp. The corporation would then relinquish an equal number of acres of its prioritized land selections to the management of Fish and Wildlife."The bill is a win-win-win situation," Murkowski said. "The land exchange will enhance economic development for the corporation and meets the goals of both the Alaska Native Claims Settlement Act and the base closure process. I had the opportunity to visit Adak three years ago and was amazed at the infrastructure on the island."Murkowski said he hopes the bill will get a hearing from the entire committee within the next few weeks. The Aleut Corp. plans to use the complex as an air and sea trans-shipment facility, a refueling and re-provisioning area and a fish processing center for the area.The last sailor left Adak on March 1. Petty Officer Ronald O’Toole, a Seebee, had been on duty at the Navy Caretaker Site Office since April 1999. He has the distinction of being the last uniformed military member to serve on Adak, marking the end of nearly 60 years of continuous presence there.The first troops secured the Aleutian Island during the early days of World War II. Other islands in the chain -- Attu and Kiska -- were occupied by the Japanese.The Naval base was one of the country’s outposts during the Cold War, with the job of keeping track of Soviet ship and submarine movement along the Alaska coastline. After the Soviet Union broke up, the expense of maintaining the remote base was judged to be too high for its then-diminished value.A bill promoting the land exchange first surfaced in 1997, but concern over asbestos in a number of the base buildings delayed its passage. Congress has since appropriated funds to the military to remove and stabilize the asbestos at the facility.The Navy plans to continue environment refurbishing projects this summer, including assessing the environmental condition of different sites on the island and coming up with a plan to deal with hazards on the island. Also planned this summer is the demolition of more than 50 cabins.

Communication keeps customers and employees happy

Today’s businesses must change course quickly. Communication and information are essential to innovation, good customer service, high retention and change. And it has to flow freely.In a survey my organization conducted, respondents were asked, "To improve your workplace environment, what would you like to see your executives, supervisors or managers do?"Sixty nine percent of the respondents said, "Be better at communicating."You’d think that with so many ways to communicate -- cell phones, Internet, e-mail, personal digital assistants, pagers and so forth -- our ability to communicate would improve. But the opposite seems to be true: As technology advances, the quality of communication declines.Put another way, as the quantity of communication tools increases, the quality of communication decreases.In 1995, the Boeing Co. suffered its second-longest walkout ever when the Machinists Union led a 69-day strike against the company. Boeing lost hundreds of millions of dollars and experienced big customer service headaches when the company missed the delivery dates on 36 airliners.Part of the problem was that while Boeing preached teamwork and productivity, it sent jobs out to lower-cost subcontractors. This disconnect between what management was saying and doing escalated tensions between the union and management.Boeing’s chairman and president blamed the strike on its "own lack of understanding of worker sentiment and on a failure to communicate corporate concerns to the work force." He noted that part of the problem lay with Boeing’s "inability to communicate effectively on what we were about and why we were about it."In 1998, United Parcel Service suffered a similar fate when its employees went on strike. UPS lost over $700 million in revenues and a blow to its credibility and trust among its loyal employees. In retrospect, the company’s Atlanta human resources director, said, "No one won." He noted that the walkout could have been prevented if UPS had done a better job of communication prior to and during the negotiations.UPS learned two important lessons from the strike. First, the employees did not fully understand their benefit packages prior to the strike. If they had understood them, much of the confusion could have been eliminated. The final settlement between the union and management did not significantly increase benefits over the previous contract.Second, UPS underestimated the need to communicate during the actual negotiation process. To avoid confusing people during the rapidly shifting negotiations, it kept a tight rein on information -- a major mistake, as it turned out.Employees wanted to know what was going on, and because they couldn’t, many loyal employees felt betrayed by management and walked off the job. The lack of information created a backlash and anger, resentment, legal actions and lost revenues.Finally, UPS learned never to assume that your people know what you think they know. When in doubt, over-communicate.Organizational types: low- and high-accessThere are two basic types of organizations: low-access and high-access. Good communication is a hallmark of the high-retention work environment. At its heart, communication is all about access.In a low-access organization, the flow of communication is guarded and restricted. People find themselves kept in the dark, like mushrooms, stuffed in narrow confines based on job descriptions, ranking and where they sit on the organizational chart.It’s no surprise that low-access organizations, many of them hierarchical, have greater difficulty responding to change, fluctuating customer needs and the fluidity of the modern workplace.In contrast, a high-access organization thrives on information and shares it to the maximum extent possible. The more information people have, the more quickly they can respond to the changing needs of customers and the environment. High-access companies are committed to open communication.Symptoms of the low-access organization include: A low-access organization is structured around rules, regulations and policies. Management places more emphasis on enforcing rules than eliminating unnecessary rules and regulations. The low-access organization has a top-down decision making process. The low-access organization has a reward system that minimizes change and initiative. Because only the people on top of the organization are responsible for interpreting and approving any changes to regulations, decision-making slows down because the responsibility and power to make decisions is taken away from those who need it the most. A low-access organization protects itself from change. Only a disaster, a threat or a public relations crisis is enough to initiate change. In the compartmentalized, functionally aligned, department-by-department organization, there is an expert for everything. In its worst form, a low-access organization becomes a caste system. Top-down layering dictates what roles to take, whom to talk to, and with whom to associate. Rank, position and educational degrees become more important than results.Gregory P. Smith leads the management consulting firm called Chart Your Course in Conyers, Ga. He can be reached via e-mail at ([email protected]).

UAA spends $14 million for part of University Center mall

University of Alaska Anchorage officials are purchasing about one-fourth of the University Center mall, which lost many tenants and was sold late last year.The move expands the UAA campus space by 6 percent and breathes in new life for the retail tenants who remain at the state’s third-largest shopping center.Also, UAA is finalizing details to acquire another 30,000 square feet at the former Gottschalks west entrance, said Chancellor Lee Gorsuch.For UAA, the $14 million deal will boost classroom space, ease parking and provide improved access to offices for student services like registration and financial aid, officials said.The price tag includes renovations to create high-tech classrooms, labs and an auditorium. University staff could move in during November and classes could begin in January, UAA officials said.Six months after acquiring the University Center with a partner, JL Properties, an Anchorage developer and property management company, is selling its piece to UAA.Last December JL Properties acquired the 350,000-square-foot shopping center with Furniture Enterprises of Alaska, which owns Sadler’s Home Furnishings, said Leonard Hyde, a managing member of mall owner University Center LLC.Each partner bought a piece of the mall, said Hyde, who is president of JL Properties."I think it’s very positive for the mall," he said. "As you know the mall is significantly empty at this point."UAA is buying the 90,000-square-foot portion owned by JL Properties, he said. That section, built in 1986, extends south from the site of former tenants Roundtable Pizza and Bering Sea Originals to the movie theater, he said.The addition of UAA students and faculty could be a boon for current tenants like Habitat and Natural Pantry."It will be new activity at the mall that will be good for merchants," he said.Sadler’s also will operate at the mall, Hyde said.Opened in 1972, University Center was owned by Hickel Investment Co. and ranked as the third-largest shopping center in Alaska, behind Dimond Center and the Anchorage 5th Avenue mall.However, the mall lost tenants due to national closures and relocations elsewhere, among other factors. Last year Gottschalks department store closed its University Center location.Last year university leaders asked legislators for $25 million to buy and renovate the mall. That appropriation bid was unsuccessful, and Hickel Investments considered other offers at that time.Hickel Investments returned the title to its lender, Equitable Life Insurance Co. JL Properties and Furniture Enterprises acquired the mall from the lender, Hyde said.The university also bid on the mall when Equitable Life auctioned it, but did not win the bid, Gorsuch said."This is our third attempt," he said.The university was not part of the original plan by JL Properties and Furniture Enterprises, he said.In March, the University of Alaska Regents approved buying a part of the mall. The university will issue bonds to finance the deal which will be reimbursed from a $14 million legislative appropriation in the capital budget. The legislation awaits the governor’s signature.On May 20, UAA said it is buying part of the mall. The $14 million price tag includes $5.7 million to buy 90,000 square feet plus another $5.7 million for renovations, Gorsuch said. The remaining $2.6 million is earmarked to purchase the additional 30,000 square feet from Furniture Enterprises, he said."It will be a great supplement to the original package," Gorsuch said.Negotiations continue between the university and JL Properties, Hyde said."One thing to keep in mind is there will ultimately be significant work done to this facility," he said.He would not list the amount JL Properties and Furniture Enterprises paid for the mall.University officials believe advantages of the mall acquisition include proximity to campus and added space for less than leasing or building in Midtown Anchorage."It’s a great deal for us," Gorsuch said. UAA’s price for part of University Center is one-fourth to one-third the cost of leasing space and half the price of new construction, Gorsuch said.The new space will house UAA’s Community and Technical College and offices for advising, payments, registration and admission.Additional space at University Center meets UAA’s need for classroom space and helps improve community access, Gorsuch said.

Business Profile: Alaska Pet-ography

Name of the company: Alaska Pet-ographyEstablished: 1989Location: 1921 W. Dimond Blvd., Anchorage, AK 99515Telephone: 907-868-1680Web site: www.alaskaportraits.comE-mail: [email protected] focus of services: Alaska Pet-ography handles studio and on-site photography of Alaskans and their pets and shoots photos for weddings, graduations and other events. The studio also features a gift store selling picture frames, albums and greeting cards.History of the company: David Jensen started Alaska Pet-ography after recognizing his affinity for photographing dogs during a University of Alaska Anchorage photography class. Also, in the mid-1980s he noted a market niche for in-studio pet photography when he searched for a studio to photograph his dog.In 1989 he started the business, taking portraits part time while working at another job. He worked as Alaska Pacific University public affairs director until 1998 when he chose to pursue his photography business full time.Alaska Pet-ography gained clients, but the busiest season was August through December when customers wanted family portraits for Christmas cards and gifts. He estimates he photographs 300 to 400 families in those five months.Three years ago Jensen started photographing weddings to diversify the business and meet customer requests. This year he expects to photograph 50 weddings. Jensen also expanded to shoot portraits for political campaigns, engagements and graduations.Jensen ran Alaska Pet-ography from his home until opening his office and studio two years ago.In February Jensen spent $35,000 on digital photography equipment including a camera, monitor, scanners, computer and printer. Using digital equipment allows customers to see images minutes after the shoot and pick up their photo orders sooner, he said.Jensen’s wife Carol helps during the busy season, and the company has employed part-time staff. David Jensen aims to hire a full-time employee by August.Top accomplishment of the company: Jensen is proud of Alaska Pet-ography’s reputation in the state. "There’s a lot of name recognition out there," he said. The photographer also travels to other Alaska communities for photo shoots.Major player: David Jensen, photographer, Alaska Pet-ographyBorn in Fairbanks, Jensen graduated from Anchorage’s Service High School. He later earned a degree in journalism and marketing from UAA. Jensen worked for the legislative affairs office. While building his photography business, he was a part-time writer for Catholic Social Services publications.-- Nancy Pounds

Alyeska moves engineers to Anchorage

FAIRBANKS -- Alyeska Pipeline Service Co. will move 40 project engineers to Anchorage, Alyeska President David Wight said May 21.The announcement brings to 100 the number of jobs lost from the company’s Fairbanks office, though some positions from Valdez will be transferred north.Alyeska announced in April it would cut 150 jobs statewide, with 60 positions from Fairbanks or along the pipeline route."It’s a tough time," Wight told the Greater Fairbanks Chamber of Commerce.The company began notifying employees of the changes May 21.Alyeska, a consortium owned by six oil companies, has 1,049 employees. Only 900 will remain in the company’s three divisions in Fairbanks, Anchorage and Valdez, Wight said. Anchorage and Valdez will lose about 90 jobs.Many of the layoffs will occur in July and others will take effect by the end of the year.The 40 engineers bound for Anchorage are part of the company’s project department and the move will bring them closer to Alyeska contractors, Wight said.City Mayor Steve Thompson expressed disappointment over the move. "It’s unfortunate we don’t have those contractors here in Fairbanks," he said.Under a 1997 reorganization, Alyeska laid off 450 employees and moved 260 people to Fairbanks. Fairbanks, Anchorage and Valdez each gained human resources, accounting and finance departments, Wight said. Now those functions will be centralized in Anchorage.Fairbanks North Star Borough Mayor Rhonda Boyles said she believes there is plenty of opportunity with military projects, such as the National Missile Defense project at Fort Greely, for those who want to stay in Fairbanks. She met May 21 with representatives from the Department of Defense, Fluor Alaska, the project’s main contractor, and Boeing, the project’s designer.

Agrium Kenai plants, Dowland-Bach win exporter awards

Two companies operating in Alaska with international sales received the Governor’s Exporter of the Year awards. Agrium Kenai Nitrogen Operations was chosen as Exporter of the Year, while Dowland-Bach Corp. of Anchorage received the first such award for small business.Awards were presented May 23 during the annual Export Alaska 2002 banquet in Anchorage.State trade officials chose to honor two award winners since international trade, from small and large businesses, plays a significant role in the Alaska economy, said Bob King, spokesman for Gov. Tony Knowles."It’s tough for smaller firms to compete in these type of honors," King said.The Agrium Kenai Nitrogen Operations complex was built in 1968 and expanded in 1977. It now includes two ammonia plants and two urea plants with combined annual production capacity of nearly 2 million tons.About 97 percent of Agrium Kenai’s products are exported, said Lisa Parker, Agrium community relations coordinator. Top markets for Agrium Kenai’s products are Korea, Japan, Thailand and Mexico, she said. "In the last year we exported to 14 different countries," Parker said.Alaska’s fertilizer exports have grown to $190 million recorded last year, up from $113 million in 1999."We’re very honored to receive this award," she said.Dowland-Bach, owned and operated by Alaskans, was started in 1975. The company manufactures well head control systems for the North Slope and international markets. Dowland-Bach has sold its products to BP Amoco PLC for its oil fields in Colombia, according to Charles Becker, director of the Alaska Export Assistance Center.Other nominees were acknowledged at the banquet: Aleut Enterprise Corp., Circumpolar Expeditions, Natchiq Sakhalin LLC and Tesoro Alaska Petroleum Co.

Seafood plant shuts down for retooling

ANCHORAGE -- Alaska Seafood International will shut down for two weeks this month to retool in advance of an expected rush of big orders, said Russell Schreck, chief executive.New equipment to automate fish processing and packaging will greatly enhance the Anchorage plant’s efficiency, Schreck said. During the shutdown, about 40 line workers will go on leave with pay, he said.Schreck also said the company will begin doing business as the Great Alaskan Seafood Co. The fish plant already has marketed a breaded salmon product under that name.The massive South Anchorage fish plant is still working on its revival plan after financial troubles hobbled its start-up in late 1999. The $50 million factory building is owned by the state. ASI’s landlord, the Alaska Industrial Development and Export Authority, also owns about 20 percent of the company. The majority owner is Sunrise Capital Partners, a New York investment firm that specializes in turning around troubled businesses.Schreck said the company is close to several contracts with large buyers. Early this year, Great Alaskan goods premiered in Sam’s Club stores nationwide.Schreck said the company is banking on its Arctic Mist Flavor-Loc treatment, which keeps the fish moist and tender when heated, to win market share.

This year's Alaska military projects top half-billion dollars

Any way you measure it, the military is spending big bucks in Alaska. A drive to improve housing for military personnel, a new mission for the Army, replacement of aging infrastructure and the National Missile Defense System all are being worked on this year.The total: about a half-billion dollars’ worth of projects.Pinning down more a more precise figure is difficult because every project is at a different phase of completion. The numbers are based on an analysis by the Alaska District of the U.S. Army Corps of Engineers, which handles all construction for the U.S. Army and most construction for the U.S. Air Force. It does not include work for the Navy or the U.S. Coast Guard.In all, the Corps has about $1.2 billion in projects that have been funded. According to spokesman John Killoran, each project goes through three phases: design, "acquisition" -- essentially the bidding process -- and construction. The bidding and construction phases of over half the appropriated funds are scheduled for up to three years from now.Another consideration is that once a project is begun, its total value is listed even if it takes several years to complete. Thus, the largest military construction project in the state, the Bassett Army Hospital at Fort Wainwright, contributes $178 million to the total even though construction has only recently begun, and most of the work will take place in 2003 and 2004.Besides the hospital, about $58 million worth of other military projects are either under construction now or will begin this year. The Corps plans to put another $50 million in contracts out to bid this summer, which could allow construction to begin this year. That brings the total to $286 million.Then, there’s the missile defense system. On April 16, the Corps awarded a $325 million contract to Fluor Alaska Inc. for work involving the system. Killoran said the initial award was capped at $250 million and will be used to build support facilities for the system at Fort Greely and to upgrade the radar system at Eareckson Air Force Station in Shemya.Killoran said other work on the system is currently banned by the 1972 Anti-Missile Treaty with the former Soviet Union. The United States has formally given notice that it will pull out of the treaty and will no longer be bound by its terms on June 14.Adding the initial $250 million missile defense contract to the $286 million in existing Corps projects puts the total value of projects either under construction or slated to start this year at $536 million.Killoran said that in order to handle the huge volume of projects, much of it generated by Alaska’s Congressional Delegation, the Corps has been changing the way it does business. Where it once had separate divisions handling each of the three phases, now it names a project manager for each project, who shepherds it through to completion."It helps us in dealing with the customer and it makes us more efficient," Killoran said. "That saves us time and money, and the quality control is better."Killoran said the Corps still has several years to complete the switch to a project management system, but "we are getting there."Where the money goesA lot of the money spent on military projects in Alaska involves replacing or renovating facilities that are simply too old. Alaska’s biggest military bases were built during World War II or in the decade that followed. Construction of Fort Richardson and Elmendorf Air Force Base were a major reason why Anchorage is today Alaska’s largest city.But, as Killoran pointed out, the barracks built in the 1950s are inappropriate for the soldiers and airmen of today, especially those with families. And with all-volunteer forces, good housing is one way the armed forces can convince their members to re-enlist.That’s why the Corps has $393 million set aside to build new dormitories, homes and entire neighborhoods over the next three years at bases throughout Alaska, and Congress appears poised to approve $39 million more.The Air Force is also working with private developers to get more housing built faster, and is in the midst of a $111.5 million construction project not funded through the Corps.Aging facilities were also among of the reasons for replacing the base hospitals at Elmendorf and now Wainwright. Basic infrastructure is also wearing out. Upgrading power plants, heating systems, wastewater systems and other utilities at Alaska’s bases are currently scheduled to cost $157 million over the next two years, with more recently authorized by the U.S. House.The remainder of the Corps’ budget is used to support the mission of the armed forces in Alaska. The projects range from new hangars for the Air Force to improved training facilities for the Army.The decision last year to station a quick-response Interim Brigade Combat Team in Alaska, which requires housing for more soldiers and pre-positioning vast amounts of equipment in the state, has also generated millions of dollars in projects, with more in the pipeline from Congress.

Audit says BP used Alaska workers, vendors for Northstar

ANCHORAGE -- Most of the $400 million BP Exploration (Alaska) Inc. spent to develop its Northstar oil field went to Alaska-based contractors and vendors, according to a new legislative audit.In terms of employment, the audit also found that 68 percent of workers hired by BP and its contractors were Alaska residents.Local hiring could have been even stronger had BP and the contractors better tapped a pool of unemployed labor in Alaska during Northstar’s development, the audit said.BP spokesman Paul Laird said May 21 the audit highlighted the company’s efforts to make good on promises to maximize Northstar benefits to Alaskans."The project brought a whole new industry into the state, the fabrication of large production modules," he said.Those modules, used for housing workers and processing oil and well fluids, rose like leviathans at the Anchorage port in the late 1990s. Building the structures, rising up to 10 stories tall, provided work for hundreds of workers through contractors such as Veco Corp. and Natchiq Inc. Before, such structures were built in places such as Louisiana and shipped north.The modules sailed by barge to a small, man-made gravel island about six miles northwest of Prudhoe Bay. Since it began production in November 2001, the Northstar field has produced as much as 64,000 barrels of crude oil a day. With about 175 million barrels of recoverable oil, it is the first offshore field in the Alaska arctic not connected to land by a causeway.Northstar was built after the Legislature passed a bill in 1996 to amend BP’s lease on the Northstar prospect, which was considered a marginal field on the North Slope, home to several larger fields.The new law offered financial incentives for BP to move ahead with Northstar. Part of the deal was that BP would "use its best efforts" to advertise for and hire Alaska residents, contractors and vendors."They were encouraged, but there were no mandatory thresholds," said Pat Davidson, legislative auditor.The audit found that from January 1997 through October 2000, BP spent about $400 million on contracts, goods and transportation for the Northstar project, with almost 70 percent of the money going to Alaska firms.

Defense bill contains $196 million for Alaska projects

The pace of military spending in Alaska will continue at a high level, if projects included in the Fiscal Year 2003 Defense Authorization Bill passed May 9 by the U.S. House eventually become law. The bill contained $196 million worth of Alaska projects.Alaska may also benefit from a portion of the bill’s $7.8 billion authorization for the National Missile Defense System. Work on part of the system is already under way at Fort Greely near Delta, with other work planned on Shemya Island in the Aleutians.Before the projects in the bill become a reality, a separate appropriations bill must pass to actually spend the money. Then, the projects must win Senate authorization and appropriation and be signed by the president."Alaska is a crucial piece of America’s defense plan, and I am pleased to know that Alaska has been taken care of in this defense bill," said Rep. Don Young, R-Alaska, in a news release.The bill also approves a 4.1 percent military pay raise.Fort Wainwright in Fairbanks got the lion’s share of Alaska projects. They include: $1.6 million for an automated sniper field fire range; $18 million for a battalion headquarters; $910,000 for specialized windows; $24 million for an infantry platoon battle course; $50 million for a mission support training facility; $16.5 million for a vehicle maintenance facility; $17.8 million for 38 units of family housing construction.The bill also approves $28.1 million for pollution control work at the Eielson Air Force Base power plant and $14.4 million to upgrade the power plant at Clear Air Force Station south of Nenana.For the bases outside Anchorage, the bill authorizes $21 million for a barracks at Fort Richardson and $10.4 million for a claim payment involving the new hospital at Elmendorf Air Force Base.-- The Associated Press contributed to this report.

Air Force finds housing solution

An innovative U.S. Air Force program is easing a housing crunch for military families at Elmendorf Air Force Base by turning to private developers to finance and build the housing.Elmendorf is the fourth Air Force base in the country to take advantage of the program, called Private Sector Financed Housing. It is the first to have the housing units built on the base, on land leased by the Air Force.The developer of the project is Aurora Military Housing LLC, jointly owned by the principals of Anchorage-based JL Properties Inc. and Hunt Building Corp. of San Antonio.Davis Constructors Inc. and Osborne Construction Co. are the general contractors for the project, according to Aurora officials.The $115.5 million project was financed with a $48 million loan from the federal government, another $48 million from the Alaska Housing Finance Corp. and private investors.The first phase of the project, consisting of 120 new housing units, was completed last fall. It’s part of a much larger series of projects that will end up with Aurora owning a total of 828 housing units on the base by the end of next year.That will go a long way toward relieving a shortage of military housing at Elmendorf. When the project began, the base had a waiting list of 700 families for its on-base housing; it took about two years for a family to get a home. Completion of the Aurora project should cut that wait in half, according to base officials.Housing is a key issue for an all-volunteer military seeking to retain its members, many of whom leave their families behind for months at a time when they are assigned overseas.

Copper River prices drop second time around

ANCHORAGE -- Fishermen in the Copper River Delta, hard hit by competition from a huge return of hatchery fish, saw prices for the second opener of the prized Alaska sockeye drop May 21 to $1.35 a pound and $4.50 a pound for kings.That compared with up to $3 a pound for first run May 16 of Copper River reds, and up to $5.75 for the chinooks, said Dan Ashe, biologist for the Alaska Department of Fish and Game."We just had a big glut of fish and we’re 100,000 reds above the projected harvest," Ashe said. The total king harvest stood at about 8,400 fish, about half of what Fish and Game predicted, Ashe said.The state forecast was for a return of some 36,000 sockeye to the Main Bay hatchery operated by the Prince William Sound Aquaculture Corp., compared with a harvest of 138,000 reds."It’s shaping up to be a good season," said Bill Webber, president of the Copper River Salmon Producers Association. "The fleet right now feels the wind is out of their sails because of the price drop, but we’ve got our whole season ahead of us."The 2001 drift gillnet catch alone for Prince William Sound was worth $21.25 million. For the combined drift gillnet, purse seine and setnet salmon fisheries, last year’s run came in at $45.2 million, Ashe said. There are some 450 to 500 vessels fishing.

Biologist asks fishermen to count killer whales three days in July

KODIAK -- The Alaska Killer Whale Count is a new project being launched this summer by researchers, and they’re asking for help.Andrew Trites, a well-known marine mammal biologist at the University of British Columbia, is traveling around the state to promote the unique research effort. He is also updating people on the latest research findings in a 45-minute presentation called "Steller Sea Lion Declines: Overfishing; Killer Whales; Environmental Change?"In the past, Trites has focused on nutritional studies, specifically, the role that pollock plays in the sea lion diet. His years of research have revealed that pollock is like "junk food" to the marine mammals. Now, more people are beginning to look very closely at predation on sea lions by killer whales, he said."We know mathematically that it would not take too many killer whales to have caused the decline in Steller sea lions, or right now to prevent them from recovering. That’s why this research is so important," Trites said.A major part of the Alaska Killer Whale Count will come from fishermen and anyone else who can report sightings for three days this summer -- July 19 through 21. "Counting killer whales on those days will help give a minimum estimate of how many there are, and whether there are any hot spots where we can direct researchers to study them more in depth," Trites said.Fishing bottoms outLumberjack is the only job that ranks lower than being a fisherman, according to the sixth edition of the Jobs Rated Almanac, just released by Barricade Books.Other worst jobs are cowboy, ironworker, seaman and taxi driver out of a ranking of 250 jobs on the list.Fisherman, No. 249, also scores near the bottom in each of the six criteria used: work environment, income, outlook, physical demands, job security and stress.Fishing is ranked No. 229 among all the jobs for stress and No. 230 among jobs for pay. The almanac estimates starting pay for fishermen at $11,000 with mid-level fishermen earning $21,000 and top fishermen earning $43,000.The almanac also sees fishing employment going down significantly through 2005. "Limited geographic flexibility, highly seasonal work and increased automation all combine to create a dismal employment outlook for small-scale commercial fishing," the book says. "Independently operating small-boat owners will find competition with the larger companies tough."The almanac says biologists rank No. 1 overall because "they are highly sought, well-paid, respected, and enjoy low stress and high autonomy in the workplace." That’s fueled in part by the growth of bioengineering and genetically modified agriculture. For best jobs, biologist is followed by actuary, a person who computes insurance premium rates, dividends and other things based on statistical data, financial planner, computer systems analyst and accountant.Fishing fundsState-managed fisheries are eligible for the first time for Saltonstall-Kennedy grants, which are expected to be funded with $10.3 million in the new federal fiscal year starting Oct. 1. In the past, the funds, which are derived from import duties, have been made available only to federal water fisheries and other reports that the National Marine Fisheries Service is setting aside $5 million for projects relating to the farmed Atlantic salmon industry in Maine and efforts to minimize potential impacts on wild Atlantic salmon.Specifically, the Maine aquaculture grants are targeted toward projects that address more secure cages; faster growing brood stock strains that are more resistant to disease and less likely to interact genetically with wild salmon; tags to trace escaped fish; vaccines to prevent transfer of disease to wild salmon; and better methods to monitor sea cage integrity and farmed fish disease.Kodiak-based free-lance writer Laine Welch can be reached via e-mail at ([email protected]).

Economist says there's still time to close gap

Despite the Legislature’s failure to deal with the state’s long-range fiscal gap this year, University of Alaska economics professor Scott Goldsmith said there will still be time next year for lawmakers to enact a package of new revenue measures so that the transition can be done without severe harm to the economy."Obviously the timetable will be more compressed, but it can still be done," Goldsmith told an Alaska Support Industry Alliance meeting in Anchorage on May 23.Goldsmith said he was surprised that a package of fiscal proposals got as far as it did, passing the state House by a wide margin.Goldsmith said he’s now optimistic that "we can get our act together" and put a plan in place before the state drains the Constitutional Budget Reserve, its ready asset account.The fiscal "gap" is the difference between state general fund expenditures and the state’s ongoing general revenues, which are still mostly from oil royalties and taxes.Goldsmith has been studying the state’s fiscal situation for several years. In the late 1980s he published a series of papers on fiscal policy, setting out a "safe landing" strategy for the state. He is now director of the Institute of Social and Economic Research at the University of Alaska Anchorage.Because oil production has been declining for some years, Goldsmith explained, the difference between spending and general revenues is approaching $1 billion this year.To cover the deficit the Legislature has been taking money from the reserve fund, which at one time held several billion dollars from one-time settlements of oil and gas tax and royalty litigation. That fund will be depleted in the fall of 2004 unless some action is taken sooner, Goldsmith said.If nothing is done and a billion dollar-plus deficit must be covered with new revenues in one year, the effect on the state’s economy will be very harmful, he said.But if a plan is put into place earlier, new taxes will have less of an impact on economic growth in the state, Goldsmith told the Alliance.A "generic" fiscal plan he developed has being promoted around the state by Alaskans United, a coalition of business and community leaders. It incorporates a broad-based tax, either an income or sales tax, as well as changes in the way Alaska Permanent Fund income is managed so that some of the fund’s $1 billion-plus annual earnings can be used to support public services. The effect of this would be a reduced citizen dividend, but the dividend can at least be retained and made more sustainable, Goldsmith said.The plan Goldsmith developed for Alaskans United assumes a modest income tax. Despite the income tax in the generic plan, the combined effect across income groups would still leave Alaskans receiving more money from the government each year than they would pay in taxes because of the dividend, even for taxpayers with $100,000-per-year incomes.However, lower-income Alaskans would be affected more than those in income groups up to $100,000 per year, mainly because of the smaller dividend, he said.What the Legislature was considering this spring was an income tax that was graduated in a way that affected income groups the way a sales tax would. State House members were sharply divided between a sales tax and an income tax, so a compromise was worked out by Rep. John Davies, D-Fairbanks, for an income tax that worked something like a sales tax.A bill changing the way permanent fund income is managed also passed the House. Neither the income tax or the permanent fund income bills were approved by the Senate, however. Nor was a third part of the package, which would have provided grants to municipalities with money from the permanent fund.

Gap doesn't slow legislative spending

Old habits die hard. Despite an $800 million budget shortfall, the state Legislature continued its tradition this year of making direct grants to organizations and communities across the state for a wide variety of purposes.In addition, traditional steel and concrete projects like highways and public building improvements were funded.The state capital budget was approved during the special session lawmakers called when they couldn’t resolve certain issues during the regular session, including the capital budget.In separate legislation, legislators also approved $463.5 million in education and transportation bond authorizations that will go before voters in statewide general elections this November.In its regular capital budget, lawmakers approved $1.15 billion in total spending, with just over $1 billion from federal and other funds, and $110.5 million from state general funds.Some of the state general fund appropriations are required state matching funds for federal highway, airport, sewer and water projects, but much of it is to fund specific projects or purchases of equipment for state agencies.A lot of this is for "soft" projects, not steel and concrete. For example, $500,000 appropriated to the Alaska Oil and Gas Conservation Commission will fund a study of long-term natural gas development on the North Slope.A grant of $250,000 to the Department of Environmental Conservation will fund a conference on "best technology" practices in oil spill cleanup. A $500,000 appropriation to the Department of Natural Resources will finance an aerial geophysical survey, part of an ongoing state program to do aerial mapping of potential mineral deposits.Lawmakers also approved $10 million in special school aid to Delta Junction to help the community meet the impacts of construction of missile defense facilities at Fort Greely and another $1 million to Delta to pay for a court settlement of a lawsuit arising over a proposal for a private prison there.The University of Alaska Fairbanks will get $32 million for a new supercomputer, which proponents said will help attract new research programs.Community organizations and municipalities will also share in the Legislature’s largess. Here are selected examples: Anchorage Economic Development Corp. will receive $500,000 for a continuation of its Global Logistics Center marketing effort, a plan to build on Anchorage’s air freight capacity by attracting warehousing of time-sensitive inventory items to the community. World Trade Center Alaska will receive $100,000 to study the feasibility of a World Trade Center facility in Anchorage, a proposed central office not only for the organization but to centralize facilities for fisheries regulatory and research agencies as well. Anchorage will get $50,000 for an Avalanche Awareness Center; the Southeast Conference in Juneau will get $150,000 for Southeast Intertie electric grid studies. Nuvista Light and Power, a subsidiary of Calista Corp., will receive $200,000 for studies of supplying power to the Donlin Creek gold mine; Nome Utilities will receive $500,000 to pay for power line extensions; the Midnight Sun Boy Scouts Council in Fairbanks will receive $150,000 for a challenged camper campsite and $67,500 for a climbing tower on a training course. Food Bank of Alaska will receive $34,000 for a new forklift, while $93,000 was approved to help a program promoting a Cook Inlet salmon brand. The Alaska Zoo in Anchorage will receive $24,000 for new animal cages.A lot of the state capital budget does go for traditional steel and concrete projects, as well as major repairs to state buildings, such as roofs.As part of the state’s ongoing program of highway and transportation improvements, legislators approved $20 million for a new fast ferry for Prince William Sound, to replace the aging MV Bartlett, as well as $4.5 million to refurbish the MV Malaspina, another state ferry vessel that is past its prime.Anchorage will also receive $4.5 million for a Ship Creek Intermodal Marine Freight and Passenger Facility, which will help the city market its port to cruise ships.Rural airport projects are also included in the state capital budget. Among projects funded this year is a $12 million new airport runway at Atka in the Aleutians; $4 million for a runway relocation at Stevens Village in Interior Alaska; $2.3 million for relocation of a runway at Tuntatuliak in Southwest Alaska; and $2 million for environmental studies of a new runway at Unalaska in the Aleutians.Some $74.3 million in airport improvements at Ted Stevens Anchorage International Airport are also included.Road projects are traditionally a part of the capital budget, although most of the money comes from federal highways funds.Besides major highway improvement projects around the state, such as continuing improvement of the Parks, Glenn and Dalton highways, the state will undertake an extension of C Street from Dimond Boulevard to O’Malley Road for $4.3 million, a reconstruction of DeArmoun Road for $3.4 million and reconstruction of Muldoon Road to $2.1 million.

Law students expect to earn $125,000 per year to start

A recent survey by Corporate Legal Times of 700 law students found that almost 50 percent of all first-year law students expect to make more than $125,000 a year upon graduation. Interestingly, only 17 percent of third-year law students expect to make that much.Over 600 of the participants in the survey say they expect to work at a law firm upon graduation while only 22 expect an in-house position. The most interesting finding is that 573 of the 700 students surveyed say they expect to leave the legal profession. A lawyer’s worst nightmareWhether they pass or fail, most bar exam takers are certain that there has been a mistake made when they receive their results. In the case of Jordan Sebold and one other person, they are right. Sebold received a "we regret to inform you" letter from the New York Board of Law Examiners.It turns out, however, that a clerical error was made and that Sebold actually passed. That same error means that someone who received a congratulatory letter failed the exam.Evidently, the entrance ticket number given to Sebold at the exam center did not match his name or Social Security number. The error was discovered by Sebold, who remembered his seat number and saw a different number on the letter from the Board.Said Sebold of the incident, "My entire Thanksgiving was basically ruined." No word yet about all the things that were ruined for the person who learned later that he or she actually failed the exam.The singing juristA California judge has been reprimanded for making "undignified comments on the bench." To be more specific, for singing undignified comments on the bench. While presiding over a misdemeanor arraignment court, the judge sang to an accused shoplifter "when you’re stealing, when you’re stealing" to the tune of "When You’re Smiling." More attorneys, fewer attorneysAccording to the Bureau of Labor Statistics, the number of lawyers in the United States will increase by 28 percent by the year 2005. This is approximately twice the rate of increase expected for other occupations.While there are more lawyers, there are also more nonpracticing lawyers. Between 1990 and 1995, the number of law school graduates practicing law dropped from 82 percent to 76 percent.HistoricalIn the early 1900s, an elephant was tried, convicted and hanged for murdering a politician’s daughter during a circus parade.FootnoteWhen called up on stage by a comedian at a comedy club, a Georgia man confessed to committing several bank robberies. "I have something on my mind that I want to share with you," the man said during the performance. The club owner had the police called and the man was arrested.Have something to share with Out of Court? E-mail it to Chet Olsen at ([email protected]).


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