Movers & Shakers February 11, 2001

Randy Sears has joined Alaska Permanent Capital Management Co. as vice president/senior markets strategist and portfolio manager. Sears most recently served as manager of fixed income investments at the Alaska Permanent Fund Corp. in Juneau. Lisa Sealy has joined APCM as securities operations officer. Sealy previously held positions with Alaska USA Trust Co. and Key Bank Alaska. Sealy has experience in securities clearing and settlement, administration and systems. Petter Jahnsen has been appointed chief investment officer. Jahnsen joined the firm in 1994 and previously served as senior vice president and as a portfolio manager. The company has appointed Bert Wagnon senior vice president. Wagnon has served as a vice president and portfolio manager since 1995. Tim Bryner has joined the Anchorage office of Eagle Insurance Cos. as regional underwriting manager. Bryner most recently served as the underwriting manager for the Anchorage division of Fremont Compensation. Bryner has 17 years experience in his field and will be responsible for underwriting workers’ compensation insurance for Alaska employers. Commerce Secretary Norm Mineta has appointed Rose Ragsdale, an editor with Alaskan Publications in Anchorage, and Elary Gromhoff, an Aleut Corp. board member, to the Export Council of Alaska. Members reappointed for three-year terms include: Chuck Webber, chairman; Tony Follett, vice chairman; Joe Henri, treasurer; Chuck Becker, executive secretary; John McClellan; Lloyd Morris; Bill Noll; John Norman; Ron Sheardown; Steve Smirnoff and Carol Heyman. April Jensen, president of the Anchorage Chamber of Commerce, recently completed a week-long professional development program with the Institute for Organization Management at the University of Arizona in Tucson. Presented by the U.S. Chamber of Commerce, the program helps participants build skills to address greater member needs, tighter resources and increased competition. Justine Polzin, executive director of the Soldotna Chamber of Commerce, recently completed a week-long professional development program with the Institute for Organization Management at the University of Arizona at Tucson. Presented by the U.S. Chamber of Commerce, the program offers continuing education for chamber of commerce and association executives. Steve Dike has been promoted to partner, information technology, at Mikunda, Cottrell & Co. Dike, a certified public accountant and a Solomon Software certified systems engineer, has experience in implementing and converting computerized accounting systems. Dike previously owned a local accounting and technology firm. Mikunda, Cottrell & Co. has promoted Jim Hasle and Noel Dike to audit senior managers. Hasle, who joined the company in 1999, is a CPA and has practiced with Grant Thornton. Dike worked for the company from 1990 until 1992 and rejoined the firm as an audit manager last March. Dike specializes in audits of utilities, school districts and not-for-profit organizations. Alex Beckman has been promoted to audit manager. Beckman joined the firm in 1996 and was licensed as a CPA in 1999. Beckman has experience in assisting tribal entities, nonprofit organizations and school districts. Mikunda, Cottrell & Co. has promoted Michelle Drew to audit manager. Drew joined the company in 1996 and was licensed as a CPA in 1999. Drew’s experience is in assisting not-for-profit organizations and governmental organizations. Tracy Hartung Daniel has been promoted to tax manager. Prior to joining the firm in 1996, Daniel worked as an internal auditor in the oil industry, and has experience in accounting and reporting, compliance auditing, and state and federal taxation. Jonathan Prater has been chosen as the new assistant professor/coordinator of the process technology program at the University of Alaska Fairbanks Tanana Valley campus. Prater has more than 30 years experience in education and the vocational-technical industry. Prater previously served as an adjunct instructor at the UAF Chukchi campus and as mine maintenance/mill operator instructor at the Alaska Technical Center in Kotzebue.  

Capstone nicked in FAA-union crossfire

Glitches in the FAA’s Anchorage Center software for air traffic control over Alaska became the focus of a union squabble with Federal Aviation Administration management -- but not until two labor groups erroneously discredited the Capstone technology project under way in Alaska. Capstone uses global positioning satellites and terrain databases to guide aircraft in areas with poor or nonexistent radar coverage. Its first use in the country was in Bethel, where it was rolled out Jan. 1.A press release issued by the Professional Airways Systems Specialists and the National Air Traffic Controllers Association Jan. 29 titled "Software Glitches Endanger Air Traffic in Alaska" has FAA Capstone officials baffled and refuting the claims of the two unions."These claims are unfounded and factually incorrect," said Gary Childers, with the Alaskan Region Capstone office.PASS represents 11,000 employees nationwide with 125 in Alaska, and NATCA represents 17,000 nationally.Officials from both unions later admitted that the release was intended to get a PASS employee more access to Capstone information meetings.The employee, with the FAA’s Alaskan Region Airways Facilities, has not been allowed critical training and management contact with Capstone related matters, according to PASS spokesman Ron Rahrig.But neither the FAA nor the employee would discuss the claim after the release was issued."The state of affairs up there in Alaska is horrific. This is by far the worst relationship that we have with FAA management in the entire U.S.," Rahrig said.According to FAA officials in Anchorage, the two incidents referred to in the press release involved the Micro En-route Automated Radar Tracking System while it was acquiring data from the Capstone system.The first incident happened on Jan. 19, when the Micro-EARTS software used in the Anchorage Center for air traffic control acquired an F-15 taking off from Elmendorf Air Force Base. The officials said that when the F-15 flew across a latitude slightly south of Anchorage that is the same as Bethel’s latitude, the Micro-EARTS system gave an erroneous reading.Capstone aircraft, much like transponder-equipped aircraft, have a data block on air traffic controllers’ screens, according to FAA officials with the Capstone program.When the F-15 crossed the Bethel latitude, as it was being handed off to Kenai radar, the data block on the Capstone aircraft in the Bethel area identified it as the F-15."Air traffic controllers at the center picked up on it right away and notified their supervisor, who notified John Hallinan, the Capstone program director," said Gary Childers, in the FAA Anchorage Capstone office. "There was no danger to either aircraft, controllers had the traffic, it was just misidentified."Hallinan and the center supervisor decided to monitor the system for other similar occurrences.On Jan. 20 an Alaska Airlines jet climbing to altitude from Ted Stevens Anchorage International Airport crossed over the same latitude simultaneous with a Capstone-equipped aircraft in the Bethel airport area. Once again the data block erroneously indicated that it was an Alaska Airlines jet some three hundred miles away."Center called John (Hallinan) at home and a decision to unplug the (Capstone) ADS/B system from the Micro EARTS system at the center was made," Childers said."This was not a Capstone software problem, but a Micro-EARTS software problem, as it acquired the data from the (Capstone) broadcast data," said James Call, an aviation safety inspector with the Capstone program.According to Capstone’s Call and Childers, programmers from Lockheed Martin, who write programs for the Micro-EARTS system, used a test bed system on the East Coast to simulate the data error. They rewrote the software and flew to Anchorage to rectify the software code to accept the Capstone data correctly."The system was only unplugged for 18-20 hours, and is now up and running perfectly," Childers said."We operate with a double back up system, and as you know we are very safety sensitive. At no time was the flying public or any aircraft in danger," Call said.The press release, however, stated, "The incident prompted the unions to urge the FAA to take the program off line until it’s tested and debugged completely." Also in the release, PASS official Rahrig states, "We are concerned about the testing of an experimental program in a live traffic environment," a statement that the Capstone officials refute."We voluntarily took the system out of the Micro-EARTS system, and this is not an experimental program that is being tested as they indicate," Childers said."We started testing this a year ago and now have the system installed in 84 aircraft. We are online with this, and it became official and is in use in the Bethel area as of Jan. 1, 2001," Childers added.Local NATCA official Rick Thompson, who was listed on the release and quoted in the communique, clarified NATCA’s position for the Journal."Well, PASS was having some labor management problems, and we wanted to give them some help by putting some pressure on Washington, D.C.," he said. "We fully support Capstone and any other new technology. We need it."

Bulletin Board February 11, 2001

In gear   Kronos Incorporated, a developer of labor management hardware and software, has opened an office at Pacific Office Center, 310 K St., Suite 200, Anchorage. The telephone number is 907-264-6674, and the fax number is 907-264-6602. Office hours are 8 a.m. to 5 p.m. Monday to Friday. Kronos offers time and attendance products and services for Windows, AS/400 and client-server platforms. Chris Thompson, a Kronos account executive for six years, will serve as labor management specialist for the Alaska region. A new Veterans Administration community-based medical clinic is scheduled to open within nine months on the Kenai Peninsula. The clinic will serve nearly 1,000 area veterans. Currently, there are no federal health care facility partners on the Kenai Peninsula to cover veterans’ care. The Kenai outpatient clinic will be the second in Alaska with the Alaska Veterans Healthcare System and Regional Office in Anchorage serving as the two clinics’ parent facility. Sen. Ted Stevens, R-Alaska, included language in an appropriations bill last year directing the Veterans Administration to open the clinic. Kudos The Challenger Learning Center of Alaska chose seven contest winners in its Earth Science Distance Learning Mission sponsored by Tesoro Petroleum. Winning schools were Unalakleet, Sterling Elementary School, Seldovia, Central Middle School of Science in Anchorage, King Cove, Finger Lake Elementary School in Palmer and Aniak. The missions included a two-day teacher training session, four weeks of classroom curriculum and a two-hour mission via the Internet from the center to the classrooms. The Alaska Hotel & Motel Association recently presented 2001 Stars of the Industry Awards to four Alyeska Resort employees at its annual banquet held at The Westin Alyeska Prince Hotel. Award winners included: Fred Luecker, front desk supervisor; Mary Whalen, sales coordinator; Ian Kingston, bell captain; and Cella Baker, marketing manager. The award recognizes individuals with outstanding accomplishments in Alaska’s hospitality industry. Seven official judges for the Alaska Symphony of Seafood, a new products contest for retail, food service and smoked products made from Alaska seafood, announced contest winners at the Gala Soiree and Awards Ceremony Jan. 27. Maserculiq Fish Processors of Marshall won grand prize as well as first place and the People’s Choice awards in the smoked products category for its Yukon King Seafoods Traditional Salmon Strips. Salmon Sausage Pizza Topping from Kake Foods won the food service category. Icicle Seafoods of Seattle with Ship Ahoy¨ Teriyaki Salmon topped the retail category. People’s Choice awards also went to Captain Red’s Krab Salad from So-Cal Seafood of Whittier, Calif. and Trident Seafoods’ SeaLegs¨ ExtremersTM Seafood and Crab Bites. Media Epicenter Press has published "Cold River Spirits: The Legacy of an Athabascan-Irish Family from Alaska’s Yukon River." Written by Jan Harper-Haines who was born in Sitka of Koyukon Athabascan and French-Dutch descent, the book explores a Native Alaskan family’s cultural transition in their search for a better life. The hardbound book measures 6-by-9 inches, contains 224 pages, has 50 black-and-white photographs and costs $19.95. Much obliged The Foundation of the Arc of Anchorage recently approved 70 mini-grants totaling $46,000 to children and adults experiencing developmental disabilities. The program provides up to $1,000 per grantee for products and services not supported by public funding for Anchorage and Matanuska-Susitna area residents. A top priority has been medical, dental, hearing and vision expenses not covered by Medicaid or private insurers. Therapeutic equipment is the largest category both in terms of number of applications and total amount requested. The Advocates of Victims of Violence raised more than $40,000 at its Space Odyssey 2001 Gala held recently. The event was underwritten in part by Alyeska Pipeline Service Co. Employees of Alyeska and the Trans-Alaska Pipeline System also provided volunteer support for the fund-raiser designed to eliminate the remaining debt on AVV’s new shelter. Sundries The World Heritage International Student Exchange Program is seeking host families for high school exchange students for the 2001-2002 academic school year. Couples, single parents and families with no children also are encouraged to apply. For details, contact Angeline Fowler at 800-888-9040.  

Around the World February 11, 2001

NATIONBush delays logging WASHINGTON -- A ban on road building and most logging in a third of the country’s national forests was delayed for two months on Feb. 5 by the Bush administration.The forest plan, which President Clinton announced Jan. 4, has been attacked by Republican Western lawmakers, and by energy, timber and mining industries.The delay is in line with an order President Bush made on taking office last month to halt or slow down a series of regulations and rules the Clinton administration issued in its final days.The forest restrictions were published in the Federal Register before Bush took office, so he can’t block or alter them without going through a new rule-making process. The Forest Service held 600 hearings and received 1.7 million comments while developing the plan.The Feb. 5 action changes the plan’s effective date from March 13 to May 12.Blockbuster suedLOS ANGELES -- A group of some 200 owners of private video stores has sued Blockbuster Inc., claiming the company is monopolizing the video rental market and trying to drive independent stores out of business.The lawsuit filed in Los Angeles Superior Court on Jan. 31 claims that because Blockbuster is owned by media giant Viacom Inc., the chain has "substantial market power and influence with the Hollywood studios.’’Deals Blockbuster made with studios in 1997 and 1998 to share rental revenues increased Blockbuster’s market share and drove competitors out of the market, the suit alleges.Blockbuster is the leading video rental chain, with some 7,500 stores worldwide.About 2,500 U.S. video stores went out of business in 1998, according to the Video Software Dealers Association, 10 percent of rental stores.The plaintiffs, seeking class-action status, include the owners of video stores nationwide.Prunes now dried plumsWASHINGTON -- Prunes by any other name would taste the same, but they might sell better.Plum growers have won permission from the government to call prunes "dried plums.’’Industry research shows that women between the ages of 35 to 50 overwhelmingly preferred the term "dried plum.’’By agreement with the Food and Drug Administration, the term "pitted prunes’’ will still appear on packages in small letters for the next two years. "For many years prunes were advertised for a very specific nutritional message. ... It’s strong association with laxation,’’ said Howard Nager, vice president of marketing for Sunsweet Growers Inc.Nager said the name change appears to have reversed a decline in prune sales. He said that monthly sales were now showing flat to single-digit growth.Schwab orders vacationsSAN FRANCISCO -- Charles Schwab Corp. is ordering thousands of its employees to take off three Fridays during five weeks as part of the stock brokerage’s efforts to weather a downturn.All employees that don’t interact with Schwab’s customers in the branches or telephone service centers were told not to report for work Feb. 2, Feb. 16 and March 2. To get paid, the employees will have to use their vacation time.The Friday furloughs will help Schwab pad its profits during what analysts expect to be a poor quarter.To combat the sluggish market conditions, Schwab has already slashed management salaries by up to 50 percent through March and reduced the company’s first-quarter bonus pool by 5 percent.Power of symbolsAlthough Nike spent zilch on Super Bowl television commercials, the athletic shoe and apparel giant may have run away with nine digits worth of free advertising from the game.Sponsors Report, a company that studies sponsor exposure during televised sports and special events, found that Nike’s "swoosh’’ logo appeared clearly on camera for 28 minutes. With 30-second commercials selling for $2.3 million, the company calculated Nike’s Super Bowl benefit at about $129 million.Compiled from business wire services.

Business Profile February 11, 2001

Name of the company: Alaska Option Services Corp.Established: 1983Location: 949 E. 36th Ave., AnchorageTelephone: 907-563-0078Major focus of services: Alaska Option Services Corp. provides shared electronic funds transfer services for automated teller machines and point of sale transactions around the state.History of the company: Alaska USA Federal Credit Union and seven other financial institutions pooled their resources to form Alaska Option in an effort to build a statewide network of ATM machines. In 1986 Alaska Option, National Bank of Alaska and Carrs Quality Centers developed one of the first regional point of sale programs, which allowed customers to buy groceries using electronic funds transfer services. Later that year NBA joined Alaska Option after the financial institutions had previously been competing against one another.In 1997 Alaska Option worked with the state of Alaska to act as a designated agent for electronic distribution of social service benefits via a card.The company has continued to grow during its tenure.Today Alaska Option employs a full-time staff of 15 and is governed by a seven-member board of directors. Alaska USA Federal Credit Union holds 51 percent ownership in Alaska Option, and other shareholders include Credit Union 1, Denali Alaskan Federal Credit Union, Fort Wainwright Federal Credit Union, Matanuska Valley Federal Credit Union and NBA.In 2000 the Alaska Option network processed 19.2 million transactions. Across Alaska 362 ATMs participate in the Alaska Option network.Top accomplishment of the company: "Our biggest accomplishment has been the ability to maintain large participation and to continue to grow," said John Shipe, Alaska Option president and chief executive.Major player: John Shipe, president and chief executive, Alaska Option Services Corp.Shipe’s new employer, NBA, transferred him to Alaska in 1979. He started as a project leader at the bank and was promoted several times, eventually serving as executive vice president and head of the information technology department 18 years later. Since 1996 Shipe has served as president and chief executive for Alaska Option.-- Nancy Pounds

Backbone studies gas line options, offers comparative analysis

The citizens group, Backbone: Standing Up For Alaska’s Future, studied at least 15 variations of potential projects for developing the vast quantities of natural gas on Alaska’s North Slope. The Slope has estimated known gas reserves of 35 trillion cubic feet and another 65 trillion cubic feet of gas reserves yet to be discovered.Backbone released "Alaska’s Gas, Alaska’s Future," a 130-page study, Jan. 25 that examines various gas pipeline proposals now being considered by Alaska gas producers, state lawmakers and others.Backbone said long-term supply, demand and pricing forecasts for both the Lower 48 and Asia are critical to Alaska’s decision on the right gas commercialization project.The study was conducted by Backbone members with the help of industry and legal experts. It examines the history of gas pipeline proposals in Alaska, dating back to the early 1970s and culled research, opinion and literature to develop a unbiased basis for comparing all of the gas line proposals.Backbone and the study’s authors stopped short of endorsing a single project, but developed a comparative analysis of each proposal that has been discussed so far. "Before we turn one shovel on the wrong project, we need to get all the information we can on the right project," said Christy McGraw, Backbone’s director.Such variables as market price, cost of service and wellhead netback were evaluated within a common framework. However, the outcome reflects estimates because of all the unknowns, including the effect that decisions the Canadians make could have on the projects.The analysis included six variations of a tidewater liquefied natural gas project involving different quantities of gas being marketed annually; three variations of an Alaska-Canada Highway project; and the so-called "over the top" proposal that would ship North Slope gas offshore across the Beaufort Sea to Canada’s Mackenzie Delta and then south to market.The analysis also examined the benefits of a Y-line project, combining a tidewater LNG project with a 4 billion cubic-feet-per-day or a 3 Bcf/d Alaska Highway pipeline project.

Calendar February 11, 2001

Confabs The Anchorage Chamber of Commerce is holding a Make It Monday forum called "Economic Impacts and Environmental Initiatives: The Pacific Northwest Cruise Ship Industry" at noon Feb. 12 at the 4th Avenue Theater. Al Parrish, vice president of government and community relations for Holland America, will give a presentation on the Pacific Northwest cruise ship industry and its effects on this region. The cost is $14 for members and $20 for others. For additional information, call 907-272-2401 or visit ( The National Park Service is holding a series of open houses to seek ideas on managing the backcountry of Denali National Park and Preserve from 4-8 p.m. Feb. 12 in Healy, Feb. 13 in Cantwell, Feb. 15 in the Susitna Valley, Feb. 20 in Anchorage and Feb. 21 in Fairbanks. For locations and details, contact Mike Tranel at 907-271-1712. The Anchorage Chamber of Commerce Business Connection Breakfast is planned for 7:30 a.m. Feb. 13 at the Sheraton Anchorage Hotel. Held in conjunction with the Rural Small Business Conference, the breakfast will feature speakers relating to technological changes in rural Alaska. The cost is $12 for members and $14 for others. For reservations or more information, call 907-272-2401. The Mat-Su Borough Small Business Development Center and Brenda Forsythe of Training Solutions are presenting a seminar entitled "Microsoft Mail Merge" from 9 a.m. to noon Feb. 13 at Training Solutions, Lakeview Professional Building, 851 E. Westpoint Drive, Wasilla. The cost is $40. For more information and registration, call 907-373-7232. Situs Inc. is offering a course entitled "Train the Evaluator Office/Industrial Ergonomics" from 9 a.m. to 4 p.m. Feb. 13-15 at Tesoro Alaska Petroleum Co.’s Anchorage office, 3230 C St. Fees vary for different course sections. Space is limited, and registration is required. For more information, call 907-563-0950. The Greater Fairbanks Chamber of Commerce is holding its general membership luncheon at noon Feb. 13 at the Westmark Fairbanks Hotel. George Kitchens, general manager of Golden Valley Electric Association, will address the topic "Energy Future of the Interior, a GVEA Perspective." The luncheon cost is $11.25. For more information, call 907-452-1105. The Greater Soldotna Chamber of Commerce is holding its weekly meeting at noon Feb. 13 at the Riverside House, 44611 Sterling Highway. The City of Soldotna Special Election Mayor Forum is scheduled. For more information, call 907-262-9814. The Greater Wasilla Chamber of Commerce is holding its Must Be Tuesday luncheon program at noon Feb. 13 at the Mat-Su Resort, 1850 Bogard Road. Greg Berberich, president and chief executive of Matanuska Telephone Association will provide an update on MTA operations and direction. Program fees are $3 for members and $5 for others. An optional lunch is available for purchase. For more information, call 907-376-1299. The Internal Revenue Service, the Department of Labor and the Anchorage Small Business Development Center are sponsoring a free seminar on employer payroll taxes from 8:30 a.m. to 4 p.m. Feb. 14 at the Department of Labor, 3301 Eagle St., Room 101. For more information, call 907-274-7232. The Mat-Su Borough Small Business Development Center is offering a workshop on recordkeeping from 9 a.m. to noon Feb. 14 at the SBDC office, 201 N. Lucille St., Suite 2-A, Wasilla. The SBDC has scheduled a small business owners tax return workshop from 1-4 p.m. Feb. 14 at the same location. Individual workshops costs $25. The fee for attending both workshops is $40. For more information and registration, call 907-373-7232. The Kenai Chamber of Commerce is holding its weekly meeting at noon Feb. 14 at the Old Town Village Restaurant, 1000 Mission Ave. The luncheon cost is $10.50. For more information, call 907-283-7989. The Greater Palmer Chamber of Commerce is holding its weekly meeting at noon Feb. 14 at the Palmer Moose Lodge, 1136 S. Cobb St. Dave Holmquist and Fred Stier of Valley Pathways, an alternative high school, are the scheduled speakers. The cost is $9. For additional information, call 907-745-2880. The Resource Development Council for Alaska Inc. is presenting a program at 7:30 a.m. Feb. 15 at the Petroleum Club of Anchorage, 3301 C St. Bob Poe, executive director of Alaska Industrial Development and Export Authority, will present "AIDEA: Report on Statewide Resource Development Endeavors." Breakfast for members cost $12 and $15 for others. Reservations are required. For more information, call 907-276-0700. The Anchorage Chamber of Commerce Business After Hours is scheduled for 5-6:30 p.m. Feb. 15 at the House of Harley Davidson, 4334 Spenard Road. Networking, food and door prizes are planned. For reservations, call 907-272-2401. The Institute of Management Accountants is holding its monthly dinner meeting beginning with a social hour at 5:30 p.m. Feb. 15 at the Golden Lion Hotel, 1000 E. 36th Ave. Neal Fried of the Alaska Department of Labor will speak on the Alaska economic forecast. The cost is $24, a portion of which is designated for the IMA Scholarship Fund. All accounting professionals and students are welcome. For more information, contact Barbara Bryant at 907-257-2325. The University of Alaska Fairbanks Small Business Development Center is presenting a workshop on how to write a business plan from 6-9 p.m. Feb. 15. The fee is $25. For more information, location and registration, call 907-456-7232. The final installment of the four-part Governor’s Millennium Lecture Series is scheduled for 7 p.m. Feb. 15 at the Alaska Center for the Performing Arts Discovery Theatre. Thomas Freidman, New York Times foreign affairs columnist, will discuss world events and how they affect Alaskans and all Americans in the 21st century. The lecture is free and open to the public. For more information, call 907-465-3500. The 2001 Pacific Rim Construction, Oil and Mining Exposition & Conference is slated for 10 a.m. to 6 p.m. Feb. 13-14 at the Sullivan Arena in Anchorage. The PAC COM Expo fosters further development of construction, oil and mining industries in Alaska and the Pacific Rim by bringing together foreign and Alaska personnel from various industries, services and government ministries to the exhibition and related conference. For additional information, call 888-509-7469 or visit ( The Board of Forestry is meeting at 10:30 a.m. Feb. 14 and 8 a.m. Feb. 15 in the Department of Environmental Conservation building, 410 Willoughby Ave., Juneau. The agenda includes the Alaska Clean Water Agenda, salmon restoration funds, Region III legislation and the Kenai Forest Fragmentation study among other topics. Teleconferences also are scheduled in Fairbanks and Anchorage. For details, contact Claudia Dwyer at 907-269-8463. The Division of International Trade & Market Development and the Alaska World Affairs Council are presenting a "Doing Business in Japan" trade seminar from 8:30 a.m. to 3:30 p.m. Feb. 16 at the Anchorage Marriott Downtown. The Japanese Protocol Business Dinner is scheduled from 6-8 p.m. Feb. 15 at Tempura Kitchen. For seminar and dinner reservations, call 907-269-8110.  

Movers & Shakers February 4, 2001

Acclaim Technology has hired Jim Henry as account executive for Alaska. Henry will be responsible for both new business and service to existing accounts. Henry has been involved in the Anchorage information technology industry for more than 15 years, and has experience in systems management, telecommunications and technical sales. IT Alaska Inc. has added Ingrid Gadpaille as an environmental technician to its Anchorage staff. Gadpaille has 13 years experience in oil spill contingency planning, spill response and regulatory compliance. Gadpaille will be responsible for geographical resource database development, oil spill contingency planning and regulatory compliance. Jeannie Yarnell has joined the environmental and engineering firm as a geographic information system specialist. Yarnell will be responsible for GIS support for commercial, state and federal clients. Yarnell previously worked for the U.S. Geological Survey. Greg Liebl, chief structural engineer at Design Alaska, is now a principal at the firm. Liebl joins Jack Wilbur, president; Bill Payton, chief architect; and Bob Gras, chief electrical engineer, as a full partner in the corporation. Liebl has been Design Alaska’s chief structural engineer since 1995. Jennifer McKee has joined Brady & Co. as an administrative assistant. McKee will provide administrative and technical support for the employee benefits department. McKee previously served as regional director of the American Heart Association in Olympia, Wash. Johnathan Limb has joined the Anchorage office of USKH Inc. as a staff civil engineer in the firm’s civil engineering department. Limb, an engineer in training, is a recent graduate of the University of Alaska Anchorage with a bachelor’s degree in civil engineering. The Anchorage Chapter of the Association of Information Technology Professionals recently elected its 2001 officers and board of directors. Elected were president, Jim Henry, Acclaim Technology; vice president, Richard Ender, retired from the University of Alaska; treasurer, Bryan Brown, Alaska Communications Systems; and secretary, Cindy Baldwin, General Communication Inc. Jodi Phelan of Northrim Bank, Lynette Vig of MicroAge and Scott Armstrong of Mercury Data Group were elected to the board of directors. Janice Blanchard of Municipal Light and Power serves as region director. The Alaska Native Tribal Health Consortium board of directors elected Donald G. Kashevaroff chairman of the board and president of the consortium. Kashevaroff is president of the Seldovia Village Tribe, chairman of the Seldovia Native Association Inc. and owner of an Anchorage consulting firm. Paul Sherry has served as the president/chief executive of ANTHC since its inception three years ago and will continue to serve as CEO. Other board officers elected for 2001 are vice-chairman, Lincoln Bean Sr.; secretary, Eileen Ewan; and treasurer, H. Sally Smith. Michelle Stockey and Elizabeth Wicke have been promoted to loan officers at Credit Union 1. Stockey joined the credit union in 1993 and is the main branch manager. Stockey’s additional duties will include processing loan requests at the Eide Street branch. Wicke has been with Credit Union 1 for nearly two years, and is responsible for opening new accounts and consumer type loans at the DeBarr Road branch. William Earnhart has been elected partner at the law firm of Lane Powell Spears Lubersky LLP in Anchorage. Earnhart concentrates his practice in commercial litigation. Earnhart is admitted to practice in Alaska, Washington, Oregon and the Ninth Circuit Court of Appeals. Sen. Drue Pearce, R-Anchorage, has been chosen for the Defense Advisory Committee on Women in the Services. The U.S. Coast Guard nominated her to the committee in recognition of her legislation work assisting the Coast Guard in performing their duties in Alaska. The committee is appointed by the Secretary of Defense to provide recommendations on issues that affect military women.  

Pollock, cod fishing begins with uncertain future in Steller rules

Winter fishing for pollock and cod is under way in the Bering Sea and Gulf of Alaska, thanks to a budget rider pushed through Congress in December by Sen. Ted Stevens, R-Alaska.The National Marine Fisheries Service published emergency regulations Jan. 20 implementing a new fisheries management plan allowing vessels to start fishing."Overall it’s OK, compared with what we thought we would have to live with," under a Biological Opinion published by NMFS on Nov. 30, said Stephanie Madsen, vice president of the Pacific Seafood Processors Association."But it’s still not as good as what we had last year," before a September court injunction closed prime fishing areas, Madsen said.Some good news is that the pollock biomass in the Bering Sea has grown, so the pollock fleet there has a quota of 1.4 million metric tons compared with about 1.14 million tons in 2000. But it will be more difficult to fish that quota because of the restricted fishing areas, Madsen said.The Gulf of Alaska is a different matter. The pollock biomass there is down, and quotas are down 10 percent. There are more fishing restrictions, too."In the gulf, it’s almost as constraining as under the injunction," said Heather McCarty of the At-Sea Processors Association. "Seventy five to 80 percent of the prime fishing grounds may be off limits, instead of 95 percent," McCarty said.Meanwhile, huge uncertainties still hang over the groundfish fleet, a billion-dollar industry that is an economic mainstay of coastal communities like Kodiak, Akutan, Atka and Unalaska.For starters, the reprieve is only for six months. Stevens’ amendment allows a gradual phase-in of a restrictive fisheries management plan based on NMFS Biological Opinion on endangered Steller sea lions.But the plan, which would severely curtail the big groundfish industry, would still come into effect after June, according to Madsen.NMFS must publish revised regulations June 10 to cover fishing during the remainder of the year, according to the Jan. 20 notice.Federal fisheries scientists could find new information before June, causing them to change their opinion that fishing contributes to a rapid decline of Steller sea lion populations. Unless that happens, the June 10 regulations will incorporate recommendations of the Nov. 30 Biological Opinion.The fishery could also be curtailed sooner. U.S. District Court Judge Thomas Zilly, the Seattle judge in a lawsuit brought by Greenpeace over the Steller sea lions, will convene a Feb. 2 hearing to consider whether NMFS’ emergency regulations provide enough protection for the Stellers, which are listed as endangered under the Endangered Species Act.Greenpeace, the plaintiff in the suit, has taken the position that the emergency regulations still leave the sea lions in a state of jeopardy. They are encouraging the judge to reimpose an injunction against fishing inside critical Steller habitat areas issued in September and lifted in November, when the latest NMFS Biological Opinion was published."Even this phase-in may be problematic. If the plaintiffs can persuade the judge that the management plan under the Biological Opinion is the only way sea lions are protected, we may find ourselves out of compliance with the Endangered Species Act," said McCarty of the At-Sea Processors Association.The agency may be in a bind on the legal issue because no matter what Stevens did in Congress, the Nov. 30 Biological Opinion says Stellers are jeopardized by fishing. Zilly could order NMFS to stand by its Nov. 30 opinion, despite Stevens.For the big pollock fishery in the Gulf and Bering Sea, the fishing plan NMFS has implemented is essentially the management plan that was in effect during most of last year, before the September court injunction went into effect. The 2000 plan defined Steller sea lion habitat areas, closed some to fishing and allowed limited fishing in others.In September Zilly’s injunction closed all areas within 20 miles of sea lion habitat to fishing. This blanketed most of the Gulf of Alaska and portions of the Bering Sea coast.The new plan reopens some of these areas to fishing but sets out some new restrictions. For example, while the total pollock quota for the Bering Sea fishery is larger this year, fish taken from a prime fishing area north of Unalaska that is important to boats operating from that community, is capped at last year’s tonnage.But fishing is at least being allowed in that area. Under the Nov. 30 Biological Opinion it would have been closed, as it was when the September court injunction was in place. Fishing boats operating from Unalaska would have had to travel farther to where fishing was allowed, at a time of year when most of the fish are in restricted areas.There are other rough edges. Madsen points out that "50 percent of the critical habitat areas are supposed to be open, but only 40 percent is really open based on the boundary lines we’ve seen.""We hope to get the council to look at this in February, so that we can get up to 50 percent," she said. Some changes are positive, though. One is that 60 percent of the Pacific cod quota can now be fished in the first half of 2001, and 40 percent in the last half, Madsen said.Previously it was reversed, with only 40 percent available in the first half of the year. Cod fishing is usually better in the first half, so the higher quota is important, she said. But even the temporary plan allowed this spring will cost the industry about 45,000 metric tons of fish that could have been taken inside closed or restricted areas, compared with spring 2000 harvests in those areas, according to an analysis by industry and community groups.The analysis was provided to the North Pacific Fishery Management Council when it met Jan. 8 in Seattle. It also showed the revised plan will cost the industry about $11.7 million.Shore-based fishing boats and plants will bear the brunt of this with a $5.8 million loss, according to the analysis; $2.76 million of the loss will be borne by the offshore catcher/processor fleet, $1.05 million by mother ships, the floating processors that buy from smaller fishing boats, and $2.02 million by Community Development Quota groups in coastal villages, which sell or fish their assigned quotas of pollock and cod themselves or in joint ventures.

Feds OK True North permits

FAIRBANKS -- Permits have been issued for the True North gold mine project, clearing the way to start construction of the project 30 miles north of Fairbanks.The U.S. Army Corps of Engineers permits issued Jan.24 go into effect immediately.The permits were the last government approval that Fairbanks Gold Mining Inc. needed."We’re very pleased for the company and for the community," Tom Irwin, general manager of Fairbanks Gold Mining, told the Fairbanks Daily News-Miner.The first True North ore should be available to process by the end of March, according to a statement from the Toronto-based Kinross Gold Corp., parent company of Fairbanks Gold. True North will be in full production by the end of June, the statement said.Fairbanks Gold wants to mine 180,000 ounces of gold a year over three years at True North. The mine will cost $25 million to construct and will employ 110 people. Fairbanks Gold plans to build a $1 million underpass on the Steese Highway to be used by ore trucks and mine employees.Opponents of the mining project have met to discuss options that may include appealing to Superior Court. Under state law they have until Feb. 19 to appeal.

Cruise ship jobs worth $15.2 million to Juneau

JUNEAU -- A new report says the cruise ship industry generated the equivalent of 748 year-round jobs in Juneau with a payroll of $15.2 million in 1999. Juneau’s share accounted for nearly half of the jobs the industry created in four Southeast towns studied.The report, The Economic Impacts of the Cruise Industry in Southeast Alaska, examined spending, tax revenue and jobs associated with the industry in Juneau, Ketchikan, Sitka and Haines during the 1999 tourist season."Anecdotally, people understand that the industry had grown," said Loren Gerhard, director of Southeast Conference, which sponsored the study, "and we wanted to measure that."The conference is a membership organization that includes municipalities, chambers of commerce, visitors bureaus and others. The conference is interested in infrastructure development in the region, Gerhard said."(The report is) not going to please everybody, including some of the cruise ship companies," Gerhard said.Gerhard said the study was paid for with a "sizable" grant from the cruise ship industry with the understanding that the industry wouldn’t have any editorial input or oversight.Results of the project held no big surprises, said Eric McDowell, managing partner of The McDowell Group, which authored the report.Each of Juneau’s 748 year-round equivalent jobs has an estimated $20,400 average income, according to the report. Year-round equivalent jobs combine seasonal jobs to make a comparable one-year job. For instance, three seasonal tourist jobs lasting four months equal one yearly job.The estimated 748 jobs account for 5 percent of total employment in Juneau, but only 3 percent of payroll, the report said. The highly seasonal jobs, were they year-round, would pay about half of what Juneau’s average job pays.The actual number of people employed in cruise-related jobs in the four Southeast towns studied peaked in July 1999 at about 5,100, according to the report.Juneau fared better in spending by cruise passengers, lines and crew than other towns in the report. The McDowell Group estimated the three groups spent $181 million in Southeast, of which $90 million was spent in Juneau. Passengers accounted for more than 80 percent of the spending, according to the report.Juneau also came out ahead in the amount of sales taxes collected. The report estimated Juneau collected more than $2.8 million in cruise-related sales taxes. Ketchikan nearly equaled that amount, and Sitka and Haines combined for just more than $1 million collected.The cruise industry is growing while other parts of Southeast’s economy, such as fishing and fish processing, timber and government have been flat or in decline. The number of cruise passengers grew from 235,000 to nearly 600,000 in the ’90s, a 154 percent increase, the report said."It is safe to assume that cruise-related employment has increased in relation to total cruise activity," it said.

This Week in Alaska Business History February 4, 2001

Editor’s note: "This Week in Alaska Business History" revisits events that shaped our past."Those who cannotremember the past arecondemned to repeat it."-- George Santayana, 1863-195220 years ago this weekAnchorage TimesFeb. 4, 1981Mapco sees Earth Resources expansion aheadBy John KnowltonTimes WriterThe new parent company of Earth Resources of Alaska wants to expand that firm’s involvement in the development of a possible petro-chemical industry in Alaska.But Robert Thomas, president of Mapco Inc., isn’t saying how much expansion he is looking at. In the best tradition of corporate management, he says he’s keeping all his options open."We’re not ruling out anything at this point," Thomas said Tuesday.Mapco bought out the Dallas-based Earth Resources Co. in a tax-free stock exchange two months ago. Thomas is in Alaska this week on a "get acquainted, hand-shaking" visit.Anchorage TimesFeb. 7, 1981Arco to build 21-story towerBy John KnowltonTimes WriterArco Alaska Inc. said Friday it will begin construction this summer of a $30 million, 21-story office building in Anchorage. The building will be the tallest and most expensive privately owned office building in Alaska.The company also said Friday it has purchased the multi-unit complex it currently is leasing from Anchorage real estate developers Gene and Dick Silberer. The value of the purchased complex and the 21-story tower will be between $50 million and $60 million.Arco officials said the oil company’s present building and the new tower will be connected with a glass enclosed atrium and total nearly 800,000 square feet of office space. The new tower will consume nearly all of the block bounded by Seventh and Eighth avenues and G and H streets.10 years ago this weekAlaska Journal of CommerceFeb. 4, 1991Southeast may get road accessAlaska Journal of CommerceSoutheast Alaska communities, isolated by a rugged coast, mountains and icefields have long sought access by highway to the Interior. New transportation links, bringing with them new port development and water transportation services, will allow these communities to broaden their economies, now narrowly dependent on nearby coastal resources, such as fisheries and timber, or in Juneau, state government.Start-up of the Greens Creek Mine near Juneau, now the nation’s largest silver mine, has stimulated mineral exploration across Southeast Alaska and nearby British Columbia.At the northern end of Southeast, Skagway and Haines have long enjoyed surface access to the Yukon Territory. Skagway is already the outlet for mines in the Yukon, and new developments in the territory will add significantly to the volume of ore being shipped through Skagway next year.Alaska Journal of CommerceFeb. 4, 1991Alaska means business for Puget Sound, PortlandBy Ralph NicholsFor the Journal of CommerceWhen tourists from Alaska first visit the restaurants, shops and ferry terminal along the Seattle waterfront, they’re quick to notice the name of the street that passes by.It’s called Alaska Way, for here -- almost a hundred years ago -- men and equipment stood in long lines to board steamships that would carry them north to the Klondike gold rush.Business ties between the Pacific Northwest and Alaska have been strong ever since.But even before the gold rush of 1897-1900, prominent businessmen in this rapidly growing city on Puget Sound had acknowledged the importance of trade with Alaska.In April 1882, they organized the Seattle Chamber of Commerce, with a primary goal of expanding trade with Alaska.-- Compiled by Ed Bennett.

Calendar February 4, 2001

Confabs The Anchorage Chamber of Commerce and the Anchorage Convention & Visitors Bureau are sponsoring a Make It Monday forum on the economic impact of Fur Rendezvous on the Anchorage business community at noon Feb. 5 at the 4th Avenue Theatre. Mary Pignalberi, Fur Rendezvous executive director, is the guest speaker. For additional information, call 907-272-2401 or visit ( The Greater Fairbanks Chamber of Commerce is holding its general membership luncheon at noon Feb. 6 at the Westmark Fairbanks. Debbie Sedwick, commissioner of Community and Economic Development, is the scheduled speaker. The luncheon cost is $11.25. For more information, call 907-452-1105. The Greater Wasilla Chamber of Commerce is holding its Must Be Tuesday luncheon program at noon Feb. 6 at the Mat-Su Resort, 1850 Bogard Road. Wayne Carmony, general manager of Matanuska Electric Association, will discuss state vs. local regulatory control. Program fees are $3 for members and $5 for others. For more information, call 907-376-1299. The Kenai Peninsula Small Business Development Center is sponsoring a seminar on how to start a business from 1-4 p.m. Feb. 6 at the Kachemak Bay Campus of the Kenai Peninsula College in Homer. The cost is $15. For more information, call 907-262-7497. WOMEN$fund, a program of YWCA of Anchorage, is offering a 14-week Starting With Success course from 6:30-8:30 p.m. beginning Feb. 6 at the Gateway Learning Center, 801 Karluk St. The course covers the basics for starting a successful business or refocusing an existing business. For additional details, call 907-274-1535. The South East Regional Resource Center is sponsoring Comtech: Connecting Alaskans to the Future 2001, Feb. 7-9 in Juneau. The sixth annual technology trade show will feature more than 50 seminars, seven hands-on computer labs and panel discussions. The keynote address will be given by Howard Charney, senior vice president of Cisco Systems Inc. To register, call 907-586-6806 or visit ( The Greater Palmer Chamber of Commerce is holding its open meeting forum at noon Feb. 7 at the Palmer Moose Lodge, 1136 S. Cobb St. The forum will provide updates to local economic development and agency reports as well as a networking opportunity. The cost is $9. For additional information, call 907-745-2880. The Kenai Chamber of Commerce is holding its weekly meeting at noon Feb. 7 at the Old Town Village Restaurant,1000 Mission Ave. A presentation on Job Shadow Day will be given. The luncheon cost is $10.50. For more information, call 907-283-7989. The Association of Information Technology Professionals is holding its regular monthly meeting at 6 p.m. Feb. 7 at the Regal Alaskan Hotel. Dave Lewis, operations manger of Alaska Fiber Star, will discuss the future of technology in Alaska. For reservations, e-mail ([email protected]). The Resource Development Council for Alaska Inc. is presenting a program entitled "Alaska Business Opportunities in China and Emerging Markets" at 7:30 a.m. Feb. 8 at the Petroleum Club of Anchorage, 3301 C St. Mike Burns, president of Key Bank and Pete Leathard, president of VECO Corp., are among the scheduled speakers. For more information, call 907-276-0700. The Anchorage Small Business Development Center is sponsoring a seminar on starting a business from 8:30 a.m. to 3:30 p.m. Feb. 8 at the SBDC office, 430 W. Seventh Ave. A seminar on developing a business plan is scheduled from 8:30 a.m. to 3:30 p.m. Feb. 9 at the same location. Each seminar costs $30. For registration, call 907-272-7232. The Mat-Su Borough Small Business Development Center is offering a seminar entitled, "Electronic Commerce 101 - First Steps for Business Owners," from 9 a.m. to noon Feb. 8 at the SBDC office, 201 N. Lucille St., Suite 2-A, Wasilla. There is no fee but registration is required. For more information, call 907-373-7232. The International Association of Administrative Professionals’ Billikin Chapter is celebrating its 40th anniversary beginning with a social time at 5:30 p.m. Feb. 8 at the Regal Alaskan Hotel. For reservations, contact Carol Fuller at 907-345-5411. Leisure The 2001 Homer Winter Carnival is scheduled for Feb. 9-11. Activities planned include a parade, competitions, film festivals and a night at the races. For details, contact the Homer Chamber of Commerce at 907-235-7740. Festival of the North, a month-long celebration of the arts, is continuing in Ketchikan until Feb. 28. For information about performances, exhibits and community events, call 907-225-2211.  

Alaska deeds of trust -- a primer of frequently asked questions

Here are some basic questions and answers concerning securing payment obligations (including promissory notes) with real property in Alaska.Q: Is a mortgage or a deed of trust used traditionally in Alaska?A: Mortgages, contracts for deeds and deeds of trust are all authorized under Alaska law. However, deeds of trust have for the past 25 to 30 years or so, typically been used in residential and commercial real estate financing transactions in Alaska.One of the principal reasons is that a deed of trust can be foreclosed nonjudicially, without court intervention, with a foreclosure sale occurring at least 90 days following the recording of a notice of default. In the event of a default, mortgages, and in many cases, contracts for deeds must be judicially foreclosed.Q: How does a deed of trust work?A: In a deed of trust, title to the property is conveyed by the owner/borrower (the "trustor") in trust to a trustee (typically a title company) for the benefit of the lender (the "beneficiary") with a power of sale in the event of a default by the borrower.The deed of trust is recorded, and thereby creates a lien upon the relevant real property in favor of the lender or beneficiary. Upon any default, and the giving of statutorily prescribed notice to the borrower and other parties in interest, the trustee can sell the property at a foreclosure sale conducted at a courthouse.Q: If under a deed of trust, the lender exercises its right under a power of sale, is it still possible to obtain a deficiency judgment for the amount owed in excess of the amount bid, or are there so-called "anti-deficiency statutes" present in the state of Alaska?A: Alaska has a broad form of anti-deficiency statute that precludes a deficiency judgment following the completion of a nonjudicial foreclosure.In some states, such as California, case law and statutes allow anti-deficiency or similar provisions to be waived in the language of the deed of trust. There is no Alaska case law of which we are aware addressing this issue, at least in advance of a default.Q: Is there an election of remedies requirement in the state of Alaska?A: Generally, if a deed of trust is foreclosed judicially, or if the note secured by the deed of trust is sued upon and a judgment is obtained by the beneficiary, the beneficiary cannot thereafter proceed with a nonjudicial foreclosure.The statute was enacted during the mid-1980s "oil patch" recession in Alaska to overrule a pair of Alaska Supreme Court decisions that allowed creditors a broad, all-inclusive set of remedies. In addition, in order to preserve the right to waive the security and sue on the note, a creditor must include a specific form of disclosure within the note or as a separate document.Alaska deeds of trust generally include language to the effect that the exercise of the power of sale in the deed of trust is at the election of the lender/beneficiary, and that the right to judicially foreclose the deed of trust is preserved in the lender/beneficiary’s discretion.Q: In general, what are the usury limits for promissory notes in the state of Alaska?A: In general, loans in which the principal amount exceeds $25,000 are not subject to usury limitations. They would, of course, be subject to concepts of unenforceable penalties, overreaching or unconscionablilty. Special exceptions from the general usury limitations apply to certain types of lenders under applicable state or federal law.Deeds of trust are invaluable instruments in Alaska when one wishes to secure the payment of obligations with a lien upon real property.Frederick J. Odsen is a member of the law firm Hughes Thorsness Powell Huddleston & Bauman LLC. He can be reached at 907-263-8255.

Citizens group offers 14 recommendations to state on pipeline

Alaska’s leaders should exert their considerable power to direct the future of the state’s natural gas development to most benefit its citizens, even if it means investing $2 billion to $5 billion of state money to own the gas pipeline outright, an Alaska citizens group said Jan. 25.The group, known as "Backbone -- Standing Up For Alaska’s Future," also released a 130-page study Jan. 25 examining various gas pipeline proposals now being considered by Alaska gas producers, state lawmakers and others.The study, "Alaska’s Gas, Alaska’s Future," was conducted by Backbone members with the help of experts. It examines the history of gas pipeline proposals in Alaska, dating back to the early 1970s and culled research, opinion and literature to develop a unbiased basis for comparing all of the gas line proposals, said Michael Metz, an engineer who helped with the design and construction of the trans-Alaska oil pipeline 30 years ago."We especially need to pay attention to synergism between the possible projects," he said. "If we can piggyback one project on another, it could lower the cost of both.""We see this study as a starting point for discussion," said Backbone director Christy McGraw, who said the study would be presented to the Alaska Legislature in early February.Former Alaska legislator Walt Hayes said the group hopes the study will spark widespread dialogue about the gas line proposals. "It is every Alaskan’s responsibility to wrestle with this issue and help the state make the best possible decision," said Malcolm Roberts, another Backbone member.Among the study’s findings:* Alaska gas may have a chilling effect on both exploration and development of gas in both Canada and the Lower 48 states.* LNG represents only a small share of the natural gas market, but its share is forecast to grow dramatically.* Alaska gas would subsidize the cost of service and wellhead value of Mackenzie Delta gas at the expense of Alaska gas revenues.* Alaska would profit in revenue, jobs and in-state use of gas more with a tidewater liquefied natural gas project than with either an Alaska-Canada Highway project or a Beaufort Sea-Mackenzie Delta project.* The most practical and profitable proposal may be a Y-Line Project that combines a 3 billion-cubic-feet-per-day Alaska-Canada Highway project with a 13.8 metric-tons-per-annum tidewater LNG project by sharing the first 541 miles of pipeline.Backbone made 14 recommendations in the study. They included continuing to study the subject; getting the producers to agree to make gas available to the best project the state discovers; developing, adopting and following a comprehensive gas policy for Alaska; enacting legislation to make all agreements and contracts public; and creating mechanisms for transparent pricing.McGraw said the group’s goal is similar to its aims when it worked behind the scenes to put the brakes on the BP Amoco-Atlantic Richfield Co. merger a year go. "We want what’s best for Alaska," she said.Backbone is a group of Alaskans with no common political party or discernible common ideology other than getting the most out of oil and gas development for Alaska.The group successfully lobbied Federal Trade Commission staff in 2000 and convinced them that divestiture of ARCO Alaska Inc. should be a condition of the merger. Ultimately, ARCO Alaska was sold to Phillips Petroleum Co.One prominent member of Backbone is former Gov. Walter J. Hickel, who is also former Interior Secretary under President Nixon. Hickel, ironically, conceived the idea of a trans-Alaska LNG project that would ship product to Asia in tankers when efforts to get an Alaska-Canada line failed in the 1970s.

Warm winter keeps cold-weather tests from getting off the ground

Thawing temperatures are dousing plans by Europeans who traveled to Interior Alaska to cold weather test aircraft in Fairbanks this winter.Flight test teams from Italy’s Agusta Helicopters and Germany’s Eurocopter Deutschland GmbH may be forced to cold weather test on the North Slope if Fairbanks’ unseasonably warm temperatures persist."This is definitely not what we expected," said Dave Carlstrom, marketing director for Fairbanks International Airport. "The Italians were told by their boss, ’Don’t come back until you finish the cold weather testing.’ "In November 1999 Agusta Helicopters chartered an Airbus "Beluga" to transport the military type high-speed helicopter to Fairbanks for cold soak testing.The Italians missed the coldest weather in December when they returned to Italy for the Christmas holiday. They came back to Fairbanks this year to complete the tests.Normally, January has the coldest average temperatures in the Interior city, with an average of 11.5 degrees Fahrenheit below zero for the month, although spikes as low as 20 below zero have been known to happen, according to National Weather Service officials in Fairbanks.The Italians, according to Carlstrom, need a 35 below zero temperature to flight test the EH-101 helicopter."Normally for January the average high is 2.6 degrees below zero, the coldest temperature spikes are normally in late December and early February," said Scott Berg, a hydrometeorological technician for the National Weather Service in Fairbanks."We are only 80 degrees off the mark today," quipped Carlstrom. "And 40 degrees warmer than normal."On Jan. 15 Fairbanks saw temperatures as high as 40, but Berg said that’s not unprecedented. "This happened seven years ago when we had warm temperatures like this.""Plans were being discussed ... to try Coldfoot or even Deadhorse, but now everyone is sitting and waiting for the mercury to drop," added Carlstrom. He said officials with Agusta do not want to test at Deadhorse due to high winds."This is not a good year to do this job," said Giovanni Puricelli, project engineer for the EH101 Agusta helicopter. "No matter where we look the temperatures are not good this year."Puricelli said the Agusta team of 11 people from Italy needs 49 degrees Fahrenheit below zero temperatures to get the helicopter certified for cold weather flights.Puricelli and his team are in Fairbanks to honor a contract with the Canadian government for an order for 15 of the helicopters headed to the military in Canada."This is a good place for logistical support. Alaska Aerofuel offers precise service and has everything we need," Puricelli added. "My two daughters and my wife came here for Christmas. Now they have asked me to move here."Asked if the Agusta group will return, Puricelli says the decision to come back, or to go to the North Pole or the South Pole will be up to someone else in Agusta management.Meantime, the 15-member German team is testing with two helicopters that are painted with German Police markings."This is a hoot. The Poletzi is flying around Fairbanks," Carlstrom said. The Eurocopter team actually rented the helicopter from the German government for the tests, thus the official paint scheme."This appears to be a global condition, not a local condition, and perhaps an environmental problem," said Elmar Kreutzer, flight test manager for Eurocopter of Germany."Although we don’t have cold weather, we are not wasting time. We are doing other standard tests here that would be done in Germany," Kreutzer said.Eurocopter is testing two models, the BK-117 and the EC-135, and needs at least five days of 30 below zero weather for a basic test program, and for a more extensive program needs seven to eight days of 40 below zero weather.Eurocopter spent nearly $500,000 to get the two aircraft to Fairbanks for testing. The aircraft came to Alaska in a Lufthansa Boeing 747-200 freighter along with the extra gear.Both the German team and Italian group have data telemetry in their hangars to receive digital information transmitted from the helicopters to the test computers.Despite the lack of cold weather, this has been a break-even year so far, said Bob Hawkins of Alaska Aerofuel. "We still have the hotel rooms, meals, transportation, and the extras like snowmachines and dog tours," he said.Alaska Aerofuel has also seen an increase in its fuel oil business locally in Fairbanks, which is helping to add revenue to the mix, according to Hawkins.Though the upturn in temperatures has the aerospace testing groups disturbed, Fairbanks residents seem to be enjoying the warming trend. In fact, local businesses are creating sales and promotions that are boosting the retail economy in Fairbanks."I think that this is just a bad year. The jet stream has changed and temperatures are warming all over," said Kreutzer. "Besides the temperatures we have great support from the locals. Everyone is friendly and helpful. Here you can get what you need to do the job."Fairbanks International Airport has marketed itself as a good spot for cold weather testing and has had success with numerous companies including Airbus, Boeing, Bombardier, Lear, Allied Signal, MD Helicopters, Raytheon, Lockheed Martin and other aerospace giants.Support for the testing, lodging and meals adds to the economy at a time when other tourism and service industries are virtually at a standstill."We’re not sure exactly how much it adds to the economy, but it’s better than a poke in the eye at this time of the year," Carlstrom said.Perhaps one of the more positive things to come out of the testing has been an influx of business for Alaska Aerofuel, which offers logistics and airport services."This is a fantastic program for Fairbanks, and we feel it’s good for the aerospace industry, too," said Tom Murray, president and owner of Alaska Aerofuel.Murray said that the warm weather is a touchy subject to the two teams and to Fairbanks locals involved in the testing promotion. "When you have two teams of 15 people each, planning a stay for three months, that can run into some serious money."Alaska Aerofuel recently added features to the logistics aspects of the cold testing projects by building special freezers for cold soaking batteries used on the aircraft. They also purchased a hangar formerly owned by United Parcel Service at Fairbanks International Airport for use by the test groups."Well, all our ducks are in order. All we are waiting for is something cold to happen," Carlstrom added.

To fill summer's lull, resort lures Germans

FAIRBANKS -- The vision of a local entrepreneur will add flights to Fairbanks and Whitehorse by a German-based luxury airline that will boost the Interior economy -- and microbrew sales -- this summer."Alaska and the North has a natural allure to it, and they have to love the healing powers of the water," said Bernie Karl, proprietor of Chena Hot Springs Resort, LLC.Karl has persuaded Condor Flugdienst, the world’s largest leisure airline and a subsidiary of Lufthansa German Airlines, to fly from Frankfurt, Germany, to Fairbanks and Whitehorse, Yukon Territory, to start a new type of circular tour bus trip that starts in either of the two destinations and ends at the other.The new service will mean that Fairbanks will be by far the smallest U.S. city with scheduled nonstop passenger service to Europe, according to the Fairbanks Convention and Visitors Bureau.The flights, using a 270-seat Boeing 767ER, will start on May 24 and wrap up Sept. 27, with flights arriving at midday on Thursdays.The package rate will start at $2,350, and go up depending on which of the two options a person wants to choose, said Andy Anger, marketing director-Europe for Chena Hot Springs.The flights will feature a local microbrew from Fox brewery Silver Gulch. The brew on board will be an amber ale with a special label called "What Ale’s You," according to Karl."That Bernie, he is a real visionary," said Johne Binkley, whose family has offered paddlewheel boat trips in the Fairbanks area for many years. "This is going to be great for Fairbanks and for Chena Hot Springs Resort.""That takes a lot of gumption," said Kevin Portorella, owner of Popeye’s, Alaska Burger Master, Winchells and a Subway franchise.Karl, along with the Fairbanks Visitor and Convention Bureau and the Fairbanks Industrial Development Corp., persuaded Condor to make the flights. But Karl had to guarantee a high percentage of enplanements before the company would agree to schedule them last fall, according to Anger.Anger was responsible for getting the word out to the biggest vacation tour groups to sell the trip and tours in advance."We contacted FTI, Der Tours, TUI, and Neckerman -- the biggest," Anger added. "These are specific tours for the German market." The tours, although billed as rugged Alaska and northern viewing, will offer a high level of comfort, according to Anger.Germans typically choose their vacations in the fall, when catalogs of destinations and packages are printed. Prussian tourists are quick to pick up the new catalogs and book their vacations far in advance, according to Anger."We were able to get in the catalogs of the big names, so we feel that we should have a very successful first season," he said.Anger said the tours offer two different 15-day packages. One, called Great Yukon Alaska Roundtrip Mountains, Glaciers, Bears and Prospectors, is designed for 49 passengers; the other, called the Great Alaska Day Hiking Tour, is for 12 people.The resort has undergone a face-lift under the ownership of Karl and his wife, Connie Parks-Karl, with remodeled rooms and upgraded facilities.The resort has also purchased a Cessna 208 Caravan on amphibian floats for flightseeing along the Yukon River, Fort Yukon, Mount Deborah, and Mount Hayes. Will Johnson, formerly of Dillingham, who has a lifetime of experience flying, much of it here in Alaska, is piloting the flights.The tours that will visit Whitehorse, Tok, Valdez, Denali and Chena Hot Springs were developed around the Chena resort’s need for more guests in the summer months."We developed this because of a hole in our season, explained Karl. "We needed more guests for the summer months. We don’t know what it is, but the summer lull has always been a challenge for us."Chena Hot Springs is well known in Japan as the place to go for aurora viewing in the winter, and as such Karl says the facility is generally full from November through March.Alaska All Season Tours Inc., a company owned by Karl, will offer the tours with an MCI 50-passenger luxury bus with bathrooms and plush interiors, according to Karl."Transportation can make or break a tour, so we had to have control of this aspect, too," Karl said.The increase in tourism in the Interior is not by accident, and according to Karl the local push is due to a changing economy, and to show off the state’s No. 1 resource."We are selling our state’s natural beauty, and it has little impact on our day-to-day lifestyle," Karl said. "I equate this with selling someone a hot dog, with a string attached to the wiener. You hand them the hot dog, and pull the dog out of the bun and keep it. They are getting the bun and the condiments, and they love it."

Bill mandates southern route

The first bill attempting to influence a decision by North Slope natural gas producers on a route for a major gas pipeline has been introduced in the state House of Representatives.House Bill 83 is sponsored by the House Special Oil and Gas Committee, chaired by Rep. Scott Ogan, R-Palmer.The bill would set in statute a definition of the state constitution’s mandate that state-owned resources be used to the "maximum benefit" of residents.For a gas pipeline transporting state-owned royalty gas and crossing state lands, "maximum benefit" is defined as a requirement that the project should allow access by Alaskans to gas, including "reasonably foreseeable" future needs, and that it maximize employment opportunities for residents, according to the legislation."It’s clear that Alaska’s interests are best served by a southern route, and this bill puts that into law," Ogan said.Producers are studying a route through Interior Alaska that would follow the Alaska Highway into Canada, called the southern route, as well as a northern route that would run east from the Prudhoe Bay oil and gas field to the Mackenzie River delta of northern Canada.Alaska’s leaders, including Gov. Tony Knowles, are supporting the southern route through the Interior because it would create more jobs for residents, although that route is longer and may be more costly.House Bill 83 would amend three existing state laws by requiring them to conform to the statutory interpretation of the constitutional language.These include the state right-of-way leasing act, under which pipeline corridors across state lands are leased to pipeline companies. The commissioner of Natural Resources would be required to certify that a gas pipeline right-of-way lease conforms to the policy of maximizing residents’ access to gas.Another law change is to the state public utilities act, to require the Regulatory Commission of Alaska to order the pipeline be built with spare capacity, so that a future spur line to a liquefied natural gas export project in southern Alaska is not foreclosed.The bill also changes the state Stranded Gas Act, a law enacted three years ago that allows the Commissioner of Natural Resources to negotiate special tax terms for a gas pipeline and LNG export project.Under the proposed change, a gas project would not be eligible for negotiated tax terms unless it met the requirement that residents have access to gas.Ogan admitted the committee bill is just a starting point for discussions on the gas pipeline.The three major North Slope gas owners are still engaged in studies of different routes and don’t expect to be able to make a decision until the end of the year.Two related bills have also been introduced, separate proposals by Gov. Tony Knowles and Rep. Joe Green, R-Anchorage, which both amend the Stranded Gas Act so that it is not exclusive to LNG projects. Under the proposals by the governor and Green, developers of a conventional gas pipeline or another gas project, such as a gas-to-liquids plant, could negotiate special tax arrangements under the Stranded Gas Act.

Successful businesses seek out equity

I am continually amazed at the level of resistance to equity ownership that I run into at the start-up business level. "I don’t want to give anyone a piece of my pie, my hard work and creativity," I hear all the time. Then there’s the frontier spirit of independence: "I can do it all alone. I don’t want money that comes attached to someone who will tell me how to run my business!" This attitude is a recipe for failure. Successful businesses are always team efforts. Founding entrepreneurs who can’t listen to others are found starting one unsuccessful business after another.Study successful companies and to a one, the founder-entrepreneur understands his or her own strengths and weaknesses and finds others with complementary skills with whom to run the business.The recipe for success is what Ernesto Sirolli calls the "Management Trinity" -- the technical skills to produce the goods or services one wishes to sell, the ability to market one’s goods or services, and the ability to financially manage one’s affairs. No one is equally passionate and proficient in all three areas.Enter equity. No one will care as much about your product as someone who has an invested interest, who wants a return on his or her investment, and so is willing to be your regular customer, serve on your advisory board and give you the feedback you need to be successful.Owner’s equity is on the bottom of the balance sheet; in accounting terms, it’s what is left after liabilities are subtracted from the assets. How are you going to put this equation in the black?People, not money, run businesses, as the recent dot-bombs and their burn rates demonstrate. Angel investors have run successful businesses and earned enough real owner’s equity to be willing to risk some of it on start-ups. They come with the connections to the talent that entrepreneurs need to complete the management trinity as well as the ability to provide meaningful mentoring and advice along the way.The other day, I had the pleasure of eating lunch with a vibrant group of young Alaskans, most in their 20s. They were concerned that most of their high school classmates are putting their college educations to work outside of the state where they have higher earning power -- often with stock options, the incentive of equity .Many of us started businesses in Alaska when we were in our 20s. Today, the economy has changed -- the markets are global, everything has been speeded up by the Internet -- but the basic tenets of building a successful company remain the same. And there are still plenty of untapped market niches for those who want to establish themselves in business and to be successful.Take entrepreneur Bob Gillam, president of McKinley Capital. He has taken advantage of Alaska’s strategic time zone and grown the McKinley fund into the 12th best performing fund in the world in the last 10 years, according to Nelson’s Investment Research.Key to his success is that he has put Alaska’s youths to work and given them a piece of his business. Twenty percent of McKinley Capital is owned by his employees, most of whom are Alaska’s college graduates, happily competing with their peers Outside.There is as yet no real active venture capital in Alaska, but we do have angel investors who are looking for good Alaska businesses in which to invest. To introduce start-up entrepreneurs to Alaska’s angels, and continue spreading the gospel of equity, Alaska InvestNet will be hosting its third annual Capital Investment Conference on March 22-23 in Anchorage.The top 10 business plans from some of the state’s most innovative entrepreneurs who are looking for equity investors will be selected for showcasing at the Venture Forum.Highlights include a keynote address by Cairn Cross of Fresh Tracks Capital, who will speak to venture capital in nontraditional markets like Alaska’s; there will also be panel discussions and educational breakout sessions. The complete conference schedule is on the Web site ( Marshall is director of Alaska InvestNet. She can be reached via e-mail at ([email protected]) or by telephone at 888-393-3662.

Ex-ARCO exec says gas hub would keep Alaska's options open

A former top Atlantic Richfield Co. executive is promoting the creation of a natural gas trading hub for Alaska gas in Fairbanks or Delta Junction. Ken Thompson, former ARCO executive vice president and ARCO Alaska president, shared his vision for establishing a competitive gas trading hub for Alaska North Slope gas about 541 miles south of Prudhoe Bay on Jan. 24 with a Commonwealth North study group in Anchorage.Alaska has 35 trillion cubic feet of known gas reserves on the North Slope and an estimated 65 trillion cubic feet yet to be discovered. Proposals currently being debated include shipping the gas to the Midwest via at least two different routes through Canada; shipping the gas to tidewater and converting it to liquefied natural gas for shipment in tankers to Asia and other markets; and converting the gas to liquids and shipping it south via the trans-Alaska oil pipeline.Thompson, who recently returned home to Alaska after establishing a similar gas trading hub in Thailand, said he believes such a facility would enable Alaska and investors to take advantage of all the options as well as provide gas for in-state demand for power generation, petrochemicals and other manufacturing.A trading hub also would help Alaska reduce the risk of picking one of the different gas projects and then watching the bottom fall out of that project as natural gas prices plummeted in the prospective market, said Thompson, who now heads his own consulting firm, Pacific Rim Leadership Development.All of the proposals for marketing Alaska gas have significant disadvantages, but a trading hub would enable gas developers to "plug in" and purchase Alaska gas for their respective project when the timing is right to be competitive, Thompson said. The pipeline to the hub and the hub itself would be owned by the state, Alaska gas producers, other investors or some combination of these entities, he added.


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