Commentary: Alaskans shouldn't forget Permanent Fund's purpose

The Alaska Permanent Fund Corp. transferred $605 million to the state this summer to cover the cost of paying dividends to every eligible Alaskan. In 2011, it transferred $801 million. Everyone can see the result: The 2012 dividend amount, to be announced at 11 a.m. today, will be much smaller than last year’s. This might be a trend with which we should get comfortable. This year’s pay-out, scheduled for early October, will move a vast amount of money into the hands of individual Alaskans. For many people, the money will be a rescue bonus, allowing them to fill fuel tanks or buy some decent tires just in time for winter. Others will use it as a treat to pay for things they wouldn’t or couldn’t otherwise buy. This conversion of the state’s oil wealth into cash for individuals is a reversal of the usual flow. The state has no income tax, and, for many families, dividend checks more than cover whatever local taxes they pay. So, as individuals, most Alaskans in essence receive non-federal government services at no direct cost to themselves. It’s a nice situation for the moment, but Alaskans should understand that this annual pay-out is not the reason for the Alaska Permanent Fund’s existence. The people who designed the fund and the Alaskans who approved the 1976 constitutional amendment allowing the dedication of state money to it were not confused about its purpose. The fund is a savings account for some of the oil wealth so the state and its communities will have a source of income if the crude runs dry. The dividend came along several years later, with various justifications. Many people have the misimpression that the earnings of the fund can only be used for dividends. In fact, the Legislature can treat the fund’s earnings like any other state income. In the fiscal year that closed June 30, those earnings totaled $1.6 billion. Only the principal of the fund, which is now greater than $40 billion, is off limits to appropriation by the Legislature. For the moment, the Legislature has approved a formula that roughly averages the most recent five years of earnings and then divides by two to arrive at the amount it will spend on dividends annually. But there’s nothing sacrosanct about that formula. Alaskans will have many arguments about the precise moment when it makes more sense to use the earnings of the Permanent Fund to support their governments than it makes to put the money in our personal pocketbooks. It’s not a topic that politicians like to discuss. However, that day could be approaching if things don’t turn around in the oil patch. The state’s budget is already on the edge of imbalance and many local governments are struggling to make ends meet. As we marvel at the fact that the government pays us to live here today, we should keep in mind that things are looking different tomorrow.

Commentary: Markets perk up in August, but storm clouds still loom

After a very rainy July we have had a better August here in Anchorage. The markets also perked up this past month as stocks gained 2.3 percent in the U.S. That puts the S&P 500 up 13.5 percent year to date. Overseas the EAFE index of developed countries gained 2.7 percent and emerging equity markets lost 0.3 percent in August. European equities have snapped back on hopes of an ECB bond buying rescue package for Spain and others. Greece still looks like a goner to us. Bonds lost a bit of their luster. The 10-year Treasury jumped 10 basis points to yield 1.55 percent. Still, the Federal Reserve is more worried about unemployment (8.1 percent) than inflation (1.4 percent year-over-year). Other central bankers tend to agree. We are in the midst of a global easing cycle to combat subpar global economic growth. Interest rates remain close to all time lows. In so far as the outlook for the rest of the year; think cloudy with a chance of showers. The macro and political environment is quite uncertain. Despite this, stocks have been on a roll climbing the proverbial “wall of worry” so far in 2012. We expect the markets to be more challenging in Q4. The death of equities? The PIMCO bond king, Bill Gross, noted last month that “the cult of equities was dying” and that stocks would be poor performers going forward. Was he just “talking his position” (bonds) or is he on to something? It’s probably the former. GMO, an asset allocation firm par excellent, expects real returns to equities to be about 3.5 percent over inflation over the next 7 years which is down from their historical 5.5 percent average. They believe that nothing has fundamentally changed about the return generating ability of equities, but rather they are a bit overvalued now owing to very high, and unsustainable, profit margins. Still, stocks will beat bonds and cash by a long shot. There’s nothing certain in life except for death and taxes. Taxes are scheduled to rise in 2013. Investors might consider thinking about 2012 tax planning (sell appreciated investments now or later?) in light of this. We should get more clarity after the November election. Here is a summary of some key considerations from Barron’s: If the Bush era tax cuts expire, this would bring a spike in tax rates for most investors and those in higher income brackets. The ordinary income tax rate for the top earners would rise to 39.6 percent from 35 percent. That ordinary income tax rate will once again be applied to dividend income, eliminating the current rate of 15 percent. The tax on dividends would be equivalent to your ordinary income rate, anywhere from 15 percent to 39.6 percent. The rate for long-term capital gains is scheduled to rise from 15 percent to 20 percent. On top of those increases, a new 3.8 percent Medicare contribution tax will take effect in 2013 to help pay for Obamacare. That tax is imposed on investment income for individuals earning more than $200,000 a year or households earning more than $250,000. While a return to Clinton era tax rates would affect most investors, there are plenty of cases in which there are no tax benefits to selling. Owners of tax-deferred accounts such as IRAs, workplace retirement accounts, and annuities aren’t immediately affected by the tax increases, since investments in those accounts aren’t taxed at all until the money is withdrawn. If Congress takes no action in the coming months, the maximum estate and gift tax exemption will fall from $5.1 million to $1 million and estate and gift tax rates will jump from 35 percent to 55 percent. Our 70,000 page tax code is complex. Perhaps the best advice is to see your friendly local neighborhood tax expert and financial planner well before year end.   Jeff Pantages, CFA, is the chief investment officer for Alaska Permanent Capital Management, a $2 billion investment management and advisory firm located Anchorage.

Editorial: Obama, media friends are an embarrassment after 9/11 attacks

It has been a difficult week for those of us deeply concerned about our national security and the safety of our fellow Americans risking their lives as soldiers and diplomats around the world. And for those of us who still believe our chosen profession of journalism demands holding those in power accountable, it has been downright discouraging. As an al-Qaeda flag flew over our Egyptian embassy in Cairo and an affiliated group of terrorists attacked and murdered our Libyan ambassador along with three other Americans on the 11th anniversary of 9/11, President Barack Obama’s lapdog media were in a quandary. Blaming former President George W. Bush — as Obama and the mainstream media do for pretty much everything — wasn’t an option. Even Obama’s acolytes in the press couldn’t spin it that way given the situations in Libya and Egypt are wholly owned by the current administration that toppled those governments in 2011 and handed them over to roving bands of militias and the Muslim Brotherhood. Inspired by the ease with which American outposts had fallen on Sept. 11 — the real video that sparked the mayhem — violence spread to more than 20 countries from Algeria to Indonesia while Obama skipped his intelligence briefing on Sept. 12 to head off to yet another fundraiser, this one in Las Vegas. So with blaming Bush out, and blaming Obama forever out of the question despite mounting evidence of his incompetence, inattention to his duties and foreign policy failures, the dutiful media settled on the next best thing: Blame Mitt Romney. Romney, you see, had the temerity to issue a statement blasting the weak-kneed statements of the U.S. Embassy in Cairo, whose Twitter feed had issued and then stood by its condemnation of some film mocking Mohammed even as the American flag was being torn to shreds by a Muslim mob. The embassy did issue a perfunctory statement against the violation of our sovereignty, but that came alongside a full-throated denunciation of an American exercising his First Amendment rights that equated the actions of a mob to the act of free speech. Rather than ask the most basic questions on Sept. 12 — such as why our Libyan consulate and ambassador lacked even basic security despite coming under repeated attacks over the last several months, or why it had not been ensured the Cairo embassy would be protected by Egyptian forces with advance warnings of the impending attack — the vast majority of the media spent the entire day attacking Romney. You’d have thought Romney was actually the president the way his response to the 9/11 attacks was dissected by the press, who were caught on an open mic coordinating their questions to the GOP nominee but still asked the same question at least five times. Of course, they couldn’t ask anything of Obama, who issued a half-hearted statement about the attacks from the Rose Garden Sept. 12 and took no questions before jetting off to Vegas. Politicians can be expected to be politicians, and now, sadly, the media can be expected to do whatever they think is necessary to get Obama reelected. Sure, the media can be expected to carry water for liberals on their favorite social issues like gay marriage, but now we’ve learned that even American deaths overseas cannot shake the media’s infatuation with this president and their desire to protect him at all cost. With few exceptions, the media has been an embarrassment since the 9/11/12 attacks. They have continued to assert the violence is all the result of the Mohammed video — echoing the central talking point from a White House that can’t afford to be seen as weak on foreign policy less than two months from an election, and after spending its entire Democratic National Convention spiking the football over killing Osama bin Laden. U.N. Ambassador Susan Rice also beclowned herself on all four Sunday morning talk shows on Sept. 16, continuing to claim against all available evidence that the murder of our Libyan ambassador was part of a spontaneous uprising over the film. The mainstream, leftwing press has also stood idly by with barely a murmur of dissent as the White House admitted it asked YouTube to review the Mohammed video to see if it violated the terms of use, and federal agents began investigating the filmmaker for potential probation violations. In fact, rather than simply stand by, as contemptible as that is, the press has eagerly jumped into the fray by publishing the filmmaker’s name, his address and photos of his home. Local law enforcement arrived en masse for a midnight knock on the filmmaker’s door and took him in for questioning while covering his face because the White House and its media accomplices have now put this man and his neighbors’ lives in jeopardy. Dutch filmmaker Theo van Gogh was shot eight times, nearly decapitated and stabbed in the chest in broad daylight in Amsterdam in 2004 for the “crime” of offending Muslims. That doesn’t seem to matter to the media doing the White House bidding. But hey, did you hear the story about Romney’s dog?

Focusing on business big and small during August recess

The August congressional recess is an excellent opportunity for me to head home for the month and talk to Alaskans about their needs, concerns, and what they want to see from Washington and Congress. I spent my time seeing familiar faces over the long summer days, meeting with local community and business leaders, barbequing with family and friends, and discussing the issues most important to our unique state. It made for an informative and warm homecoming. My staff and I also set out on our “Growing Alaska” tour where we sent both Alaska and Washington-based staff to hold mobile office hours and meet with local businesses and community leaders from Ambler to Kodiak. As a team, we visited more than 60 communities and met with hundreds of people. One of my first trips in August was to Cold Bay on the Coast Guard cutter Bertholf. The Bertholf is a critical piece of the Coast Guard’s Arctic Shield mission which will increase its presence in the Arctic, an indication that Alaska’s northernmost shores are seeing more traffic and more development. Sen. Murkowski and I were pleased to join Coast Guard Commandant Admiral Robert Papp, Sen. Mary Landrieu, D-La., and Homeland Security Secretary Janet Napolitano on the Bertholf for an overview of the Coast Guard’s critical role in our state. Alaskans everywhere tell me they want to see Alaska’s vast resources developed and developed responsibly. As I write, Shell’s rigs are preparing to begin drilling operations in the Beaufort and Chukchi seas, and I am confident we will see that responsible development Alaska is known for moving forward in the Arctic. In Anchorage, I held a roundtable discussion with local business leaders and job creators to discuss potential markets, particularly Hawaii and Japan, for Alaska’s rich supply of natural gas. I was joined by representatives from the governments of both Japan and Hawaii, as well as local leaders from industry. While still in its early stages, I am eager to further discuss this idea. Hawaii understands, like Alaska, that as non-contiguous states, the cost of energy and the cost of bringing resources to our communities is greater and more complicated than in the Lower 48. Exploring future uses of Alaska LNG is important as we look for ways to reduce costs and use more domestic energy supplies. The Growing Alaska tour was successful as my staff and I talked to small business owners and operators across the state about what’s working and not working when it comes to growing, expanding and hiring more workers. We saw some amazing success stories in every community, and in many areas the importance of getting broadband Internet to our schools and towns was a hot topic. To explore solutions to these challenges, I invited Federal Communications Commission Commissioner Jessica Rosenworcel to Alaska to meet with educators, Alaska Native leaders, and state and local officials. One point became clear: when it comes to Alaska, a one-size-fits-all approach from the federal government just won’t do. I thank Commissioner Rosenworcel for her in-depth understanding of the various telecommunication obstacles in our state, like lack of roads and infrastructure. I’m looking forward to working with her and the FCC to expand telecom services to every corner of Alaska. The rich, unrivaled culture and kindness of Alaska was apparent everywhere the Growing Alaska tour stopped. Alaskans welcomed my staff with open arms and proudly showed them their towns. From community libraries to student art projects made of marine debris, Alaskans prove their resourcefulness and creativity again and again. In Nome, there are thriving small businesses and impressive progress being made on the new hospital (which kindly housed my staff during flight cancellations). In other communities we saw the unique and creative ways that Alaskans have found to deliver health care. At the Glennallen chiropractic clinic, which functions as an overall wellness center with classes for disabled children, Sheila Hay also runs a successful smoothie and organic food shop. Its success highlights the importance of preventative care and the vital role our small businesses play in our state. We also saw progress in the way the state receives energy. In Cantwell, my staff saw firsthand the windmills financed by the Recovery Act which now power Cantwell’s tribal hall. Similar efforts to diversify our energy sources are being seen on Fire Island, where Cook Inlet Region Inc. is putting in a wind farm, just outside Anchorage. To highlight Alaska’s commitment to energy independence, I invited Sen. Ron Wyden of Oregon, a top member on the Energy and Natural Resources Committee in the U.S. Senate, on a tour of Fire Island’s new wind turbines. This was followed by an in-depth discussion on our Bipartisan Tax Fairness and Simplification bill. The bill will reduce tax rates for individuals and families and keep it simple and fair for Americans. A highlight of the bill is the use of one, easy tax form which is clean and simple, whether you’re a billionaire or a middle class American. It was a busy and productive month. I look forward to seeing you on another trip home soon. Mark Begich is the junior U.S. Senator from Alaska.

EDITORIAL: Alaskans do their part to help economic climate

Although some candidates no doubt disagree, Alaskan voters got it right Aug. 28. Only 24 percent of the electorate turned out to vote on one of the last beautiful days of summer, but those who made it to the ballot box did their part to prevent negative impacts on the state business climate. By a resounding margin of nearly 2-to-1, voters rejected Ballot Measure 2, a 15-page initiative to create a new coastal zone management program to replace the prior regime that expired in 2011 when the legislature failed to renew it. Better than residents of any other state, Alaskans understand the obstacles thrown in our path from the federal government. To cite just a few fresh examples: The Environmental Protection Agency has slapped expensive new fuel standards on the transport companies and cruise ships that play a critical role in our economy, threatening to raise the cost of everything we consume and the cost for tourists visiting our state. The Interior Department has just withdrawn half of the National Petroleum Reserve-Alaska from development and chosen an alternative that may make construction of a pipeline from the Chukchi Sea to the Trans-Alaska Pipeline System extremely difficult. Most recently, the U.S. Army Corps of Engineers decision to delay a final record of decision on the environmental impact statement for Point Thomson will cost the state as many as 1,000 construction jobs this winter alone if the agency does not stick to its previously promised late September deadline. Nevertheless, Alaskan voters weren’t buying the argument that by failing to pass Ballot Measure 2 we were ceding our destiny to the federal government. Passing the measure would have only given a host of new tools to the litigious green groups to challenge permitting decisions or whether the eventual regulations comply with the intent of the initiative. We can’t blame backers of the measure for being frustrated with the legislature’s failure to extend the coastal zone management program, and we commend their effort to put the measure before voters, but if they want to effect real change in Juneau they’ll have their opportunity Nov. 6. The ballots still aren’t fully counted, but we were heartened to see the narrow margin in the decision over Ballot Measure 1, an initiative to allow cities and boroughs to raise the property tax exemption from the current $20,000 to $50,000. As of the most recent count Sept. 4, the “yes” votes were ahead by a mere 284 votes out of 115,774 ballots counted with absentee votes still being tallied. The result of local governments raising the property tax exemption would shift budget burdens on to businesses and renters, impacting job creators and those of lesser means who are typically pinched by high costs in low vacancy areas already. While it would certainly seem to serve self-interest to vote to lower taxes on yourself and higher taxes for others, no matter what the final tally eventually is we were glad to see so many Alaskans choose the greater good over their own. It’s a lesson our elected officials would do well to take to heart.  

After August in Alaska — A full mind and a happy heart

I can’t decide whether I am the luckiest woman in Alaska or the luckiest person in America. I have just had the best 30 days anybody could have in any place ever. I have been home. Home in Ketchikan where people know my family well. In Metlakatla where when the planes don’t fly and you just deal with it, or ask somebody to take you to the airport in Ketchikan in their boat and they don’t think twice about doing it. And they call ahead to the airport to tell Alaska Airlines to hold the plane because they know the guy who works the gate. In Barrow when the sun is up so high in the sky at 11 p.m. that you feel like bedtime is a catnap in the afternoon sun. In Kaktovik, where you buzz the coastline looking for polar bears but the only one you see doesn’t move cause he’s so satiated from gorging on a ring seal that he ate for lunch (taken from a fish camp that we just visited) that he can’t move. Flying over the North Slope in a helicopter, a land that is more water than terrain, walking on the tundra that is like a magnificent sponge filled with color and water and delicate flowers. Talking with whaling captains about their ice cellars that are thawing and worrying about their food security yet anxious for more development in the Arctic as it means job security. Then down to Kodiak with the Coast Guard — everyday heroes who are there for Alaskans day in and day out. We flew out to the brown bear refuge on the island and stalked a stream to come upon a sow and her cub relaxing in the sun. We were the intruders in her world and kept a respectful distance. Kodiak is indeed the Emerald Isle. Cold Bay was the next outpost, made even more so since the only fuel source (the truck from Frosty Fuel) was out of commission. We flew out to a national security cutter in the Bering Sea and all I could think of was that these were the waters that my boys fish in. I was proud of them and afraid for them at the same time. These are big waters. I visited big bears the following day in Katmai National Park. An old boar nicknamed “Ugly” showed us how real bears fish. In Kenai I spent the day with 80 kids from military families and shared their delight as they caught humpies and silvers in the Kenai River. For many, it was their first fish ever. Verne and I flew out to Healy Lake for a celebration of life for a WWII vet and trapper who’s lived in the Interior since the 40s. A beautiful tribute to a wonderful man, complete with 21-gun salute, military flag ceremony and bowling balls shot from the canon into the stratosphere. He would have loved it. The quiet at Healy Lake in the morning was amazing — your ears absolutely rang because the quiet was so intense. Intense and beautiful is the best way to describe the Aleutians trip. Flying in a C-130 for almost 6 hours from Anchorage to Shemya. A true outpost. Flat, 2 miles by 4 miles, old buildings from WWII next to buildings housing missile defense assets. Brave souls made the “double dip” — swimming in the Pacific and then running around the cove to jump into the Bering Sea. Not me. We took the helicopter 30 minutes out to Attu — the end of the chain, directly under Russia and on its own time zone. No inhabitants on the island since 2009.  Amazingly beautiful with mountains straight up into the sky, lovely harbors and beaches and streams with fish so thick you could walk across. We helped erect a monument to the Natives who had been captured by the Japanese during the war and later interned, never to return to Attu. For an island that gets rain almost every day of the year, we had blue sky and calm winds as we ate lunch on the mossy, pillowy tundra. Adak almost seemed like civilization after Attu. Buildings and people (just over 100) were outnumbered by caribou (3,500). These three Aleutian communities are like a forgotten world, left over from the war. Amazing history. Verne and I spent our 25th anniversary at Winterlake Lodge on the back side of Mt. Susitna. The floatplane trip out was like a science class as our pilot told about the land formations and topography. Chena Hot Springs was yet another reminder to pay attention to science.  Bernie’s place is the land of possibilities and big ideas. Next year he will have bananas growing in his greenhouse! I felt like a Japanese monkey floating in the mist of the hot springs, alone on a Sunday morning before the crowds came to talk about geothermal, hydrogen and methane. In Kenai I ate graham crackers soaked in liquified natural gas to demonstrate how safe it is and then went offshore on an oil/gas platform in Cook Inlet to see where the stuff comes from. Instead of going to Tampa for the convention, I went to the Yukon River where the air is clear and the people there are focused on energy and food. Pretty basic stuff. In Beaver, a village of 70, the students danced and were shy and proud. The tables were filled with food that people had brought to share. It was obvious that those who had the least brought the most to share. Stevens Village was equally small, with big ideas about governance. Tanana is proud of their innovation with biomass and how they have brought down energy costs and created jobs. Yet, they have a new cafeteria at the school that has never been used as they wait for funding for a cook and lunch program. Our pilot (the best I’ve ever flown with) flew at about 400 feet throughout the region following the Yukon as he navigated weather. What a way to see the country. Ruby was nestled in the high bank of the river, lovely even in the rain. Tales of domestic violence and suicide marred the natural beauty of the area. In Galena we were greeted at the airport by my old friend Sidney Huntington, now 97. He’s still driving and conceded to go live in the elders facility because his wife told him she was done cooking for him. He has only made it through the third grade and is passionate about education. He has spoken at every graduation in Galena since 1973 and attends every basketball practice and game at the school. His sister is 93 and looks about 65. Good genes. Downriver we were in Kaltag, Grayling and Holy Cross. At each village the sun came out when we landed and as we were leaving the rain started to fall. After the third village it almost seemed beyond coincidental. The history of early Alaska was still present, from the mining in Ruby and sawmill in Kaltag to the old missionary church in Holy Cross. Pictures of horses and cows in Holy Cross was a reminder of how little outsiders understood the area at the time. Now it’s moose and fish again. The kids are learning their Native languages and dancing while taking pictures on their cell phones. I spent Friday evening at home in Anchorage by myself making rhubarb chutney from my plant that came from our old house.  It was good to make something from something that I grew. As I cut and stirred I reflected on all the places and people I had visited over the past 3 weeks. I am truly overwhelmed by the generosity, the warmth and support that I find. I have never received so many hugs from total strangers who greet me like a sister. And oh, the places I’ve been! Majestic, awesome, breathtaking. There are no adjectives to sufficiently describe a wilderness like Attu, Teshekpuk, the Yukon tributaries. My mind is full and my heart is happy. The only sadness I have is that in order to experience this amazing place I call home, I have to leave it. From back to D.C. and then to a conference in Iceland before it’s back to work here where people call me by my title rather than my first name and we exchange handshakes rather than hugs and talk politics rather than things that really matter, like family and food. I’m blessed in so many ways, but it’s times like this when I realize that I walk in several different worlds. Glad to have you all anchoring me to the world that really matters.

Small businesses are the backbone of Alaska's economy

When many people think of Alaska’s economy, they envision big players such as oil and gas companies, mining and seafood operators, multinational tourism businesses, and government. These employers are a critical part of the engine that runs Alaska’s economy. Without them, Alaska would not be what it is today. But there is another vital part of the economy that is often overlooked and crucial to building a better future for Alaskans: small businesses. As big businesses, banking and housing took a big hit when the recession rippled through the U.S. over the last few years, small businesses were the stabilizing force in the economy. Entrepreneurs proved to be the backbone of creativity and production. Small business stimulated and maintained economic growth. The same is true here in Alaska. At the beginning of this year, the federal Small Business Administration Office of Advocacy put together a state-by-state profile of small businesses in America. Alaska’s profile included the most recent data on the state’s small business employment numbers, how many small businesses opened and closed, the number of bank loans, as well as a break-down of business ownership by minorities, women and veterans. According to the profile, nearly 67,000 small businesses operated in Alaska in 2009. Of these, 15,838 were employers and they accounted for 52 percent of private sector jobs in the state. In the big picture, that means small businesses provided more than half of all non-government jobs in Alaska. That also means small businesses provided employment and support for more than 130,000 Alaskans and their families. It’s not just the sheer number of jobs that is important to consider. Small businesses in Alaska represented almost 40 percent of newly created private-sector jobs from 2005 to 2008. That’s an important trend that we must support in our quest to diversify Alaska’s economy. But there are warning signs that growth may be slowing. Throughout 2010, more small businesses closed down than started up. That’s why I am teaming up with the Alaska Small Business Development Center and the Anchorage Economic Development Corp. to sponsor two workshops in September aimed at helping Alaskans start their own businesses and helping current small business owners overcome the unique challenges faced in the 49th state. The first workshop was held Sept. 5 and focused on how Alaskans can launch their own businesses with guidance on how new business owners can calculate their start-up, variable and fixed costs, how to find a unique market niche, how to write a business plan, and where to get start-up money. But starting a new business is only half the battle. According to federal data, Alaska’s small businesses are very small as three quarters of all businesses do not have employees and most employers have fewer than 20 employees. That’s why it is also important for us to find ways to help existing small businesses to grow and expand their operations. The second workshop will be held on Sept. 20 and will consist of a roundtable for existing East Anchorage businesses, during which they will have the opportunity to discuss their common challenges and opportunities and brainstorm business strategies with experts from the Small Business Administration, the Anchorage Economic Development Corp. and other leading professionals. This workshop is also free and open to the public. It will be held at the Begich Middle School from 5:30 p.m. to 7 p.m. in room B104. If you’ve always dreamed of starting your own business, or are a current business owner who would like to expand, I encourage you to come join me at these workshops as we continue to build a stronger future for Alaska. Sen. Bill Wielechowski has represented East Anchorage since 2007.  

Commentary: Congress has real work to do in September

When Congress returns to Washington in September, it needs to do more than hold a few political posturing votes before going home to campaign. Even if a continuing resolution to fund government is passed as expected, there are still serious unresolved issues that should not be left for an unaccountable lame-duck session. Not only should Congress act to avert the toxic brew of tax hikes coming at the end of the year, but it should also act to check lame-duck regulatory abuses by the Obama administration. A massive $494 billion tax hike is coming on Jan. 1. Reversing the Bush tax cuts amounts to a $166 billion tax hike including higher income tax rates, smaller child credits, and the return of the marriage tax penalty. The end of Obama’s payroll tax holiday will pile another $125 billion on everyone who works. The Alternative Minimum Tax will slam millions of middle-class families to the tune of another $119 billion. The death tax will jump from 35 percent of everything above $5 million to a whopping 55 percent of everything above $1 million at a cost of $13 billion. Other expiring tax cuts will total about $50 billion, and new tax hikes from Obama’s health care law will add another $22 billion. These are not the usual 10-year estimates used in policy debates. These are one-year, immediate 2013 tax hikes that total an astonishing $494 billion. More than enough to tip the U.S. economy back into recession, perhaps sharply so. Economist Don Luskin projects that the dividend tax hike alone — slated to go from 15 percent to 43.4 percent with the expiration of the Bush tax cuts and the new Obama health care surtax — could knock 30 percent off the stock market. Seniors who rely on dividend income will be hit especially hard. Tax hikes of such a frightening size are never a good idea, but are especially foolish in what’s now widely recognized as the weakest economic recovery in the post-war period. Democrats should drop their class-warfare stance that insists on holding the U.S. economy hostage over tax hikes for upper income earners and business owners and agree to stop all of these tax hikes for at least one year. The regulatory threats in a lame duck period are similarly frightening, starting with a pending greenhouse gas regulation that would effectively prohibit new coal-fired power plants and create the predicate for litigation that would shut down existing coal plants, cementing as Obama’s legacy his promise to bankrupt coal and make electricity prices skyrocket. There are also several onerous financial rules pending pursuant to Dodd-Frank. The Labor Department has been working on a rule that would significantly increase the cost of retirement planning. The Department of Transportation has a rule pending to require rear-view cameras in all cars and trucks that would cost billions, and another to require airplane-like “black boxes” that would potentially make available to the government every detail of Americans’ driving habits. The FCC just announced a pending rule, called “special access,” to impose price regulation on a part of business broadband delivery. Those are a small sample of the known regulatory threats. There are also many unknown regulations that could be pushed out the door by a frantic outgoing Obama administration. This is, after all, a president who has elevated bypassing Congress to a virtue, bragging about how he won’t wait for Congress on everything from global warming to immigration. Rep. Reid Ribble and Sen. Ron Johnson, both of Wisconsin, have introduced legislation that would prohibit economically significant lame-duck regulations absent a national emergency. Rules that have been delayed to avoid having to defend them on the campaign trail should not be allowed to take effect after the election. Their Midnight Rule Relief Act should be passed by both chambers in September to protect the economy from looming regulatory threats. With our economy continue to suffer, it would be wonderful if Congress could come together on positive pro-growth reforms to get people back to work. Unfortunately, the best we can probably hope for is for Congress to continue current policies by rejecting big new spending bills, canceling all the tax hikes, and blocking regulatory threats to economic growth. And Congress should address these issues in September, under the watchful eyes of voters, not in an unaccountable lame duck session after the election.   Mr. Kerpen is the president of American Commitment and the author of “Democracy Denied.” Kerpen can be reached at [email protected]

Editorial: Against Props 1 and 2, for Vazquez in District J

Alaskans go to the polls Aug. 28 to decide primary races and two ballot initiatives. Here are some final thoughts: Against Prop 1: This measure would allow municipalities to raise the property tax exemption from the first $20,000 in value to as much as $50,000. It’s been advanced by some folks in Fairbanks including former Borough Mayor Jim Whitaker, who told the Anchorage Daily News that he understands this will raise property taxes on businesses. It’s not surprising that Whitaker would want to relieve the cost of living for his former constituents in one of the most expensive places to reside in Alaska, but it is somewhat surprising that he doesn’t understand that increased costs for business are either deducted from wages or passed on to consumers. Lowering taxes for some won’t lessen the overall need for revenue, and as Anchorage Mayor Dan Sullivan noted, raising the taxes on rental property owners is going to increase rents in a city that already has steep costs and a 2 percent vacancy rate. The best way to lower the cost of living for Alaskans is to reduce energy costs, not through shifting tax burdens on to others. Against Prop 2: This measure would reestablish a coastal zone management program, and it has drawn fierce opposition from the oil and gas industry, miners, labor unions and the Anchorage Chamber of Commerce, among others. Backers of the initiative have tried to cast this measure as a battle between Outside interests and Alaskans, but that’s hard to square with the opposition coming from local labor unions who depend on both the resource development sector and the capital budget funded by royalties for high-paying jobs. The Sea Party, which got the measure on the ballot, has also tried to portray the initiative as simply restoring coastal zone management that allowed for all the oil, gas and mining projects developments throughout the state over the past 30 years. However, the 15-page initiative is far from equivalent to the previous program that lapsed on June 30, 2011, when the state Senate couldn’t come up with a coastal management reauthorization and wouldn’t even take a vote or offer amendments on a measure that passed the House by a 40-0 vote. If the Sea Party had simply wanted to restore the previous program, the ballot measure would have been one sentence long instead of 15 pages. A measure to restore the program that expired would have been something we could support, but Prop 2 is a disaster in the making. The legislature needs to come up with a coastal zone management program, that much is clear. While we appreciate the sentiment of citizens attempting to do the work the Senate failed to do, Prop 2 is not the solution. For Liz Vazquez in District J: We’ll save the rest of our candidate endorsements for the November election, but we didn’t want to let the primary pass without showing some support for the candidacy of Liz Vazquez in Senate District J for West Anchorage. Vazquez is facing Bob Bell in the Republican primary, with the winner to face incumbent Sen. Hollis French. It’s nothing against Bell — although we have no doubt the abrasive French would make an issue of Bell’s connection to disgraced and convicted former Habitat Division head Cory Rossi over what the Alaska Dispatch reported was an attempt at an illegal musk ox hunt in Nome while Bell was a member of the state Board of Game. No, we are for Vazquez because she is exactly the kind of person we always wish would get into politics but all too seldom do. The daughter of Puerto Rican immigrants, not only was she the first in her family to graduate high school, she went on to earn a law degree and two master’s degrees. (She’s also likely the first Alaskan candidate to conduct a door-to-door campaign on a Segway.) Vazquez is a former prosecutor, assistant state Attorney General, administrative law judge, and attorney for the U.S. Department of the Treasury. She’ll hardly be a shrinking violet in a Senate currently distinguished by the go-along, get-along gang. Unlike French, who seems to believe oil producers are the enemy, Vazquez sees them — correctly — as partners. If the citizens of West Anchorage want someone who can be both a productive legislator while not rolling over for the oil industry, we think they’d be wise to send Vazquez on from the Aug. 28 primary and defeat French in November.

Editorial: Attacks on 'Outside' companies wrong, undemocratic

Here we go again. An initiative governing resource development is on the Aug. 28 primary ballot and it was only a matter of time before the backers of Proposition 2 to reinstate a coastal zone management program played the “Outsider” card. After finance disclosures were filed with the state for June and July, the Alaska Sea Party put out a press release decrying the fact the group has been outraised 10-1 by their opponents who were characterized as “foreign” and “Outside” companies. Notably, while accusing these companies of a nefarious scheme to buy an election and silence Alaskans, the Sea Party did not attempt to refute the main argument against Prop 2 — that it will inject a tremendous amount of new uncertainties into a permitting process already fraught with them. Those favoring Prop 2 also continue to imply that they are simply restoring the previous coastal zone management program when that is hardly the case. Instead, the only counter to the Vote No on 2 group by the Sea Party appears to be that the their position is illegitimate because of the location of their company headquarters. These attacks on “foreign” or “Outside” companies participating in the political process in a state where they have invested billions of dollars and employ tens of thousands of Alaskans aren’t just wrong. They are undemocratic, and, in the end, stunningly hypocritical. We’ve seen this argument about “foreigners” deployed repeatedly against the developers of the proposed Pebble mine project, Anglo American of London and Northern Dynasty Minerals of Vancouver. The constant use of “foreign” as a pejorative to cast these companies in an unfavorable light is farcical while bordering on xenophobic. No one believes the opposition to Pebble would somehow melt away or diminish if Anglo American and Northern Dynasty were headquartered in Alaska. We’re not surprised to see this volley fired against the opponents of Prop 2. The Sea Party has only raised about $63,000, but at least a third of that came in two donations from opponents of the Pebble mine. While the anti-Pebble forces have no problem with a consortium of Japanese-owned fish processors coming out against the project, we are supposed to believe there is something wrong with a Japanese mining company, Pogo owner Sumitomo, contributing to the “Vote No on 2” effort. Our courts, our airwaves and our ballot boxes are open to all sides and viewpoints. Yet the Prop 2 and the anti-Pebble forces act like these venues should only be available to those they agree with. Such double standards are unfortunately ubiquitous in Alaska. When Lake and Peninsula Borough passed a residency requirement stricter than state standards and rejected some ballots in the 2010 and 2011 elections, a lawsuit was filed and the ordinance was overturned to great cheers from the anti-Pebble forces. Yet when the Pebble Partnership uses the courts to challenge an equally constitutionally dubious Lake and Pen ordinance that would supersede the state role in permitting, the same folks cry foul. Similarly, environmental groups will sue, sue and sue again to contest permitting documents and decisions, yet they have rushed to embrace a scientifically indefensible assessment of mining impacts on the Bristol Bay watershed. Environmental activists would never stand for a document as incomplete as the EPA assessment to be used to allow resource development, yet they have no problem looking the other way in this case because they think it can help them short-circuit the permitting process to shut Pebble down. In December 2010, a coalition of fishing groups and the State of Alaska sued the federal government, and eventually won, on the grounds that National Marine Fisheries Service didn’t follow the law when it imposed wide-ranging cod and mackerel closures in the western Aleutians based on a theory the action would protect food sources for endangered Steller sea lions. A federal judge agreed with the state and fishermen, and noted the resulting economic harm in ordering NMFS to prepare a full environmental impact statement to support the action. Like free speech, the rule of law is not a one-way street, and stakeholders who decry the feds cutting corners when it works against them cannot credibly argue that the same government should do an end-run around the process when it suits them. There are plenty of arguments in favor of Prop 2 or against the Pebble mine, but the location of corporate headquarters is hardly one of them.

Commentary: UAF study reveals the ups and downs of fishing in Kodiak

Kodiak fishermen are a happy lot, but they are also anxious about the future of their industry. Those are some of the early findings of an ongoing survey that focuses on the social and cultural perceptions of the fishing life in Kodiak and how things have changed over two decades. The survey is part of a multi-year project titled Social Transitions and Wellbeing in Kodiak Fisheries and Communities by Courtney Carothers, an assistant professor UAF’s School of Fisheries and Ocean Sciences. Carothers lived for more than a year in Kodiak villages to research peoples’ experiences and perceptions; extensive interviews and the survey are helping to flesh out more findings. “In terms of fisheries policy, when there is an analysis of some social or human component it’s often just the economics. It all boils down to how much money people are making and what are the costs, that sort of thing,” Carothers said. “I think the social and cultural connections people have to fishing, to communities, to shared ways of living are really important.” In June, about 1,000 surveys were sent to a random sample of Kodiak fishermen in all gear groups and fisheries. It asked them to rank questions that asked how happy or satisfied they are with fishing and various aspects of it today compared to 20 years ago. Carothers has compiled responses from the first 150 returns by fishermen having an average of 26 years experience out on the water. “It’s really great that folks who have had a ton of fishing experience, mostly out of Kodiak, are sharing their insights,” she said in an interview that revealed some of her findings. Overall, commercial fishermen said if they had their lives to live over again, they would be fishermen, with most responding “yes” or “strongly yes.” Most also agreed that Kodiak is a healthy fishing community. “Very few strongly agreed, though,” Carothers said. “Most were sort of in the middle or neutral. So I think that suggests people have some concerns about certain aspects of Kodiak compared to 15 to 20 years ago.” The survey asked what people see as major threats to the sustainability of Kodiak as a fishing community and got back a wide range of perspectives. Unforeseen environmental challenges, such as ocean acidification made the list of worries. Another is friction among local fishermen. “People often mentioned the disharmony among the different gear groups in town. They feel like that has gotten a bit more pronounced and they recognize that everyone in Kodiak needs the fish to be healthy and everyone needs to get along,” Carothers said. The cost of entry into fisheries was cited as a major stressor, as was fear that spiraling costs will prevent young people from entering fisheries. Not surprisingly, the impact of catch share programs was mentioned as a major cause of change and concern for Kodiak fishermen. “Haves and have nots – that’s the way people say fishing is characterized now as compared to the past. Certain programs have been put in place and they have been great for certain people but others feel they have been left out of those programs. I think that has affected some people’s sense of wellbeing,” Carothers said. “For example, some of the crewmembers say they have less power than 20 years ago when they were able to command a good job and wage relative to other skippers and captains.” As for earnings, most said earnings are much better, others said they are worse. “I think it depends on the fishery, gear group and whether you are a crew member, a skipper or an owner,” Carothers said. About 60 percent of the fishermen said they would recommend a fishing career to young people, but worry they won’t be able to afford to buy in. Above all, Kodiak fishermen said they love the fishing lifestyle. “I think that’s another key finding,” Carothers said. “They love the livelihood of fishing, being able to make your living based in a coastal community, to be out on the water and in control of your own operation, to be your own boss, to get away from all the bureaucratic goings on in town, the teaching and learning that goes on when you bring your kids out on the boat, learning hard work and not to complain — it’s highly valued and people see that as something they always want young people to be able to access.” Carothers said her hope is that her research will help “inform regulators and others whose policies very much affect how and when people can fish.” Fish watch Alaska’s statewide salmon harvest has neared the halfway point of the 132 million fish forecast. From here on out, hitting that target will depend on how well those hard to predict pinks come in. State managers predict a catch of 70.2 million pinks, down 40 percent from last year. Pinks were moving into the major producing regions of Kodiak, Southeast and Prince William Sound, where the catch had topped 10 million. The PWS humpies are hefty, averaging 4.3 pounds, one pound heavier than last summer. At Bristol Bay, most of the fleet was heading home after catching nearly 21 million sockeye salmon. A couple hundred boats and over 50 setnetters were still fishing however – targeting pinks. Two years ago Bristol Bay had the first pink salmon fishery since 1984 with a catch of 1.3 million humpies, 800 percent higher than the past two decades. You can track Alaska’s weekly salmon catches by species and region at the “Blue Sheet” on the Alaska Department of Fish and Game website. Lots more ‘sides salmon Halibut fishermen have landed 56 percent of their 24 million pound quota with less than 10.5 million pounds to go. For sablefish (black cod), 64 percent of the 29 million pound quota has been caught. Both fisheries remain open till mid November. Weathervane scallops are still being harvested in some regions of the Gulf and Bering Sea. Trawling for pollock and various flatfish is ongoing in the Bering Sea, along with jigging for cod. The small boat red king crab season continues in Norton Sound, to be followed on Aug. 15 by the Aleutians golden king crab fishery. In the Gulf of Alaska, fishermen are still going after Dungeness crab around Kodiak and throughout the Panhandle. Gulf of Alaska pollock reopens Aug. 25 and also trawling for cod on Sept. 1. A lingcod fishery at Prince William Sound could last through the end of the year. Salmon smells Research shows that the tiniest traces of copper affect a salmon’s sense of smell, and that results in a change in their behavior. A study three years ago by Oregon State University and federal scientists revealed that copper deposited on roads from vehicle brake pads and exhaust runs off into streams and rivers. Copper levels as low as two parts per billion adversely affected the sense of smell in juvenile salmon, which they use to avoid predators. “In the environment that has some serious implications,” said Jason Sandahl, co-author of the Oregon copper study. “If there are predators around and the fish are not able to response to these danger signals in the water, I guess they would be the next snack for these larger predators in the water.” Sandahl said at higher levels, a salmon’s avoidance ability was almost nonexistent. Now another study at the University of Washington has confirmed that finding. Researcher Jenifer McIntyre, also working with NOAA scientists, found that a copper exposed fish is not getting the information it needs to protect itself. McIntyre exposed juvenile coho salmon to between 5 and 20 parts per billion of copper and placed them in tanks with a common predator, cutthroat trout. The results were striking. “A copper-exposed fish is not getting the information it needs to make good decisions,” said McIntyre, a postdoctoral research associate at WSU’s Puyallup Research and Extension Center. Salmon that were not exposed to copper would stop moving when they sensed a predator, making it harder to detect them. McIntyre called it “going into lockdown mode.” But salmon in water with just five parts of copper per billion failed to detect the predator, kept swimming and were attacked in a matter of seconds. The exposed fish were killed 30 percent of the time in the first strike; the salmon not exposed to copper managed to escape nine times out of 10 because they were poised to take evasive action. The behavior of the predator fish was the same whether or not they had been exposed to copper. Testimony by McIntyre and her team has prompted the Washington State legislature to start phasing out brake pads and linings over the next 15 to 20 years.   Laine Welch lives in Kodiak. Visit www.alaskafishfactor.com or contact [email protected] for information.

Commentary: Proof will be in the pricing for EPA deal with TOTE

The Environmental Protection Agency and a major ocean shipper to Alaska reached an agreement this week that could save Alaskans money and reduce pollution. But several questions about the deal remain. Alaska’s congressional delegation and the state administration raised a warning late last month about the impending cost of new pollution rules for ships hauling goods to Alaska. The EPA, they said, would require ships to start burning low-sulfur fuel Aug. 1 because the agency had extended the North American Emissions Control Area, under an international maritime treaty, to waters off Alaska. The state of Alaska sued to block the action. It said one shipping company reported the more expensive fuel would add 8 percent to the cost of hauling goods to Alaska, a cost that presumably would be passed on to Alaskans. That shipper, Totem Ocean Trailer Express, reached an agreement with the EPA on Aug. 3. The company has obtained a waiver that will allow it to continue burning high-sulfur fuel while it converts its two ships in the Alaska trade to cheap, clean-burning liquefied natural gas within four years. In the long run, that sounds like a fine solution, but it raises several short-term concerns. First, what will happen to shipping rates? Converting a ship to LNG sounds like an expensive operation. Will Fairbanks residents take a financial hit from this “solution”? Second, is this option available to other shippers? If only TOTE is able to swing the deal, other shippers still will have to burn the more expensive fuel. That likely would mean shipping prices would increase, regardless of whether TOTE starts saving money on its new fuel. Sen. Mark Begich, D-Alaska, who said he helped bring the EPA, U.S. Coast Guard and TOTE together to come up with the waiver, was optimistic in a news release. “The permit will help protect Alaskans from increased shipping costs, expand the market for natural gas, and ultimately lead to even cleaner air than ECA requires,” he said. “TOTE’s project will be the first major use of LNG as a ship fuel in the United States, and others in the maritime industry are sure to follow the path that TOTE will be blazing. “This means the effects of expanded natural gas use, more economical shipping and cleaner air will be multiplied many times over.” Sen. Lisa Murkowski, R-Alaska, was less encouraged. “While this deal helps one company, it does not address who will pay for the additional investments and costs required for TOTE and others to meet the new fuel standards, a total that could run into the hundreds of millions of dollars,” she said. “My fear is that the total costs of compliance will simply be passed on to Alaskans.” The waiver appears to have potential, but the proof will be in the pricing.

Family feud at Bokan forces Ucore to consider legal options

JUNEAU — A letter, originating from an ongoing and bitter family feud, to several U.S. and state government officials raising vague “concerns” over ownership rights and operations of Ucore Rare Metals, Inc.’s Bokan Mountain project in Southeast Alaska has prompted the company to begin legal action to end what it says are completely false allegations that could harm its efforts to attract investors. “I have no doubt now, based on this letter that she’s sent out, that we have to go legal,” said Jim McKenzie, CEO of Ucore, on July 24. Ucore, a publicly traded company based in Nova Scotia, is preparing to release its preliminary economic assessment on the Bokan project in August and planning to begin mine operations in 2013. Bokan Mountain, on Prince of Wales Island about 550 miles northwest of Vancouver, B.C., is a 19 square-mile project containing uranium and what may be the highest concentration of several rare earth elements in North America. McKenzie said Ucore, which has spent $30 million on the project to date, has not suffered any direct financial costs from the letter but cannot risk the uncertainty it raises as it prepares to seek development investors. “Whenever we raise money this issue of Mary has come up ... We’ve not gone legal before because she’s never been on record until she wrote the letter ... We just have to take this to court to shut her down,” he said. “She” is Mary Dotson Anderson, a daughter of Bob Dotson, the Alaskan prospector who staked the original claims in 1955. In a July 9 letter to US Sen. Mark Begich, Anderson wrote, “I have great concerns of Ucore overstepping bounds and mining and or removing ore from our claims.” The letter also alleges “possible misrepresentation and or using fraudulent information as to the 100% Bokan-Dotson property to obtain and receive government issued grant monies or public money,” and asks Begich to, “verify funds have not been dispersed without documentation that my claims are not included in their project.” The letter was copied to Alaska’s other U.S. Sen. Lisa Murkowski, Gov. Sean Parnell, the U.S. Bureau of Land Management, the U.S. Forest Service, which owns the Bokan property, and media outlets including a Platts reporter. Sharon Leighow, press secretary to Parnell, said his office has no record of receipt of the letter and would not be likely to respond. “The state does not resolve property disputes between private owners,” Leighow wrote in a July 25 email. A spokesman for the U.S. Forest Service offered a similar view. “It’s mutually understood with the Forest Service and the BLM that claimants have to settle their own disputes. We do not sep off into that process,” said Ray Massey July 25. Begich’s office did not respond to requests for comment. Anderson wrote that ownership of 25 claims that are part of the project remain in dispute between herself and her sons Raymond and David. McKenzie called the letter “a stunt to put us under duress.” He rejected its charges categorically and said options agreements signed in 2006 with four parties, including Bob Dotson, Mary other members of the family and other claims owners have been legally confirmed and accepted without complaint by all parties other than Dotson Anderson. McKenzie also said Dotson Anderson’s claims have shown low mineralization, that Ucore has no plans to mine them and, despite its legal control, will bypass them in road construction and other development work. Bob Dotson, who serves as a consultant to Ucore, said Mary owns 10 claims among several that she and other family members received for their work on the property but also rejected her complaints. “Mary Dotson Anderson will do anything that she can possibly do to harm us ... I don’t think Mary has a leg to stand on,” Bob Dotson said July 25. Mary Dotson Anderson could not be reached for comment. Sandra Everett, her sister, said July 25, that Dotson Anderson is incommunicado at Bokan Mountain working her claim as required by U.S. law to retain ownership and could be there for several weeks.

Editorial: Fuel regs show problem with Law of the Sea Treaty

On July 13, the State of Alaska filed a lawsuit to challenge new fuel requirements for ocean-going vessels plying the West Coast shipping lanes that took effect Aug. 1. The new standards imposed by the Environmental Protection Agency will raise the cost of everything that crosses our docks by at least 8 percent initially, and even further by 2015 when stricter standards kick in. The following Monday, July 16, Senate opponents to the Law of the Sea Treaty, or LOST, announced they had 34 signatures and enough to block ratification. Alaska’s delegation of Sens. Lisa Murkowski and Mark Begich were not among them, as both have been among the staunchest advocates for the Senate ratifying LOST. Murkowski has also been on the warpath against the EPA and its Administrator Lisa Jackson over the new fuel standards for Alaska, soliciting pictures from across the state that the unbelievable prices for basic goods such as milk and bread. While Murkowski, Begich and the state’s official positions are to support ratification of LOST, the manner in which these new fuel standards were established by the EPA is precisely the reason opposition hardened to the treaty and killed it once again. Back in 2009, the EPA under Jackson went to the International Maritime Organization and proposed a 200-mile Emission Control Area for the U.S. West Coast and the Great Lakes region. The ECA required the use of 1 percent sulfur fuel by 2012 and 0.1 percent by 2015. The reason the EPA was able to unilaterally impose this new ECA and fuel standards is because the U.S. is a signatory to the International Convention for Prevention of Pollution from Ships, otherwise known as Marpol. The U.S. Senate ratified Annex VI to Marpol in 2008, which set a target fuel standard for 3.5 percent sulfur. The EPA went way beyond that, and way beyond any reason when it proposed the 200-mile area where the standard would apply. Then, to add a nice dose of favoritism to the injury, the EPA exempted more than two dozen old steamships in the Great Lakes region from complying with the new standards. That was done at the behest of Minnesota Rep. Jim Oberstar, a Democrat, and Wisconsin Rep. David Obey, coincidentally also a Democrat, who held up the EPA budget until Jackson gave them the Great Lakes exemption. Meanwhile, two old steamships used by Totem Ocean Trailer Express Inc., the Western Venture and the Great Land, were rendered obsolete. TOTE had replaced the vessels with the mighty North Star and the Midnight Sun in 2003, but maintained the older ships for occasional military transport leasing and to have available in case another vessel was unavailable. Alaska Rep. Don Young was at the meeting with the EPA when Obey and Oberstar got their carve-outs, and his staff described the EPA attitude toward Alaska as “hostile” and “without an open or positive attitude” about the an Alaska exemption. So, the EPA claims this is a health benefit, then exempts the dirtiest ships in the heaviest populated areas while sticking it to Alaska. It’s a pretty short circle back to the Law of the Sea Treaty, and what’s wrong with it. Going beyond Marpol, the LOST requires signatory countries to control “land-based emissions” in addition to marine emissions. Hmmm, think the EPA under this administration wouldn’t have a field day with that provision? Proponents of LOST say it is needed to resolve territorial disputes among nations, such as China’s claims in the South China Sea or Russia’s advances into the Arctic. The problem with that is every Arctic nation and a host of others signed on to LOST have already declined to accept Article 298 of the treaty, which sets out the dispute arbitration process. Countries that have exempted themselves from dispute resolution regarding territorial claims, military matters and areas where the U.N. Security Council has jurisdiction include: Norway, Russia, the United Kingdom, Denmark, Canada and China. So even if the U.S. ratified LOST, it can’t bring China or Russia to a dispute resolution because those nations have already declared they won’t accept the process. Besides, how is it that we can negotiate bilaterally with the Russians on nuclear weapons (badly, we may add, in the last round of START talks), but we need a U.N. arbiter to resolve territorial disputes? We’ve also been told LOST would be a boon to our offshore resource development, potentially adding an area the size of California to Alaska’s claims on the continental shelf. Considering that we don’t drill off the coast of California we have now, and all the trouble Shell has encountered trying to drill less than 100 miles offshore in the Arctic, it’s hard for us to imagine we’ll suddenly be developing resources past our exclusive economic zone any time soon by ratifying LOST. Another reason LOST drew opposition was the International Seabed Authority that would govern the development of any of those new claims beyond 200 miles. If you think Alaska’s oil tax regime is bad, the royalty scheme under LOST is essentially the ACES of the sea. According to the treaty, if a project earns a 20 percent or greater return on investment, a 70 percent royalty is kicked back to the International Seabed Authority headquartered in Jamaica. The ISA then uses this money to aid “geographically disadvantaged” countries that lack coastlines. Then there’s the idea that the U.S. somehow loses standing in the world compared to some of the worst human rights violators like China and Russia because we aren’t signed on to the treaty. Just like when we were kids, “everyone else is doing it,” is still the weakest argument of all.

Commentary: First oysters growing at Ketchikan mariculture operation

The OceansAlaska Marine Science Center has barely opened its doors and tiny oysters are already growing out at the new floating facility at George Inlet in Ketchikan. The 28-acre site was granted to the non-profit by the state and Ketchikan Gateway Borough in 2006. The Center houses the first home grown source of oyster “seed” for Alaska growers, and aims to be the go to place for mariculture research and training. There are 29 shellfish farms producing in Alaska so far in Southcentral and Southeast regions. The main crop is oysters, with sales valued at about a half million dollars last year. No shellfish farm applicants have ever come from Westward regions of Alaska, said Cynthia Pring-Ham, state mariculture coordinator. “I could sell all the oysters I could possibly produce and could double sales tomorrow with just a couple of phone calls, especially in New York. There is a lack of production throughout the country,” said Tom Henderson, OceansAlaska mariculture director, and a long time oyster farm near Kake, Henderson said the Center will begin working on geoduck mariculture projects and “then get into other things, among them seaweeds.” Seaweed is the second largest aquaculture industry in the world, second only to freshwater fish. Kelp is a multibillion dollar industry in Japan, and Henderson wants to work with the traditional, local black seaweed which he said tastes better than the Japanese nori, popular in sushi rolls Economists believe expanding mariculture just in Southeast Alaska could easily increase the industry’s revenues over time from the current $7 million to more than $100 million a year. Australia produces 80 million oysters a year worth $40 million; New Zealand’s government-funded mussel industry went from $15 million to over $100 million in 20 years, and scallop farming at Prince Rupert and Prince Edward Islands in Canada is a $60 million industry. See more at www.oceansalaska.org.   Catching small crabs Alaska’s most far-flung fishing fleet plans to catch lots of “small crab for a cause” when the golden king crab season gets underway next month. Golden kings are caught in deep waters along the 1,200 miles of the Aleutian Chain, a part of the Pacific “Ring of Fire,” and the westernmost region of the United States. Goldens are Alaska’s most stable king crab stock, with a harvest this season of 6.2 million pounds. The remoteness of their home turf, however, prevents managers from surveying the stocks as often as they’d like. To safeguard the fishery, the fleet of five to six boats voluntarily uses gear with larger mesh than required by law to make sure all small crabs can escape. And therein lies the problem. “By designing their gear to avoid juvenile crab during the commercial fishery, the information you get indicates there are no small crabs down there,” said Denby Lloyd, science advisor for the Aleutian King Crab Science Foundation, a harvester group. “To assess whether the population is in a productive cycle or not, you have to use a different method, such as the one in this project.” To help solve the riddle, the fleet will use 20 test pots made with small mesh to capture the juvenile crabs. Alaska Department of Fish and Game scientists will a collect the data and return them to the sea. “The fleet has a very stable fishery and they want to make sure it remains that way, as well as grow the harvest opportunity,” Lloyd said. “By using the commercial fleet directly it minimizes costs for the state and federal government and everyone benefits from the data.” Tracking golden king crab is tricky, no matter how it’s done. The crabs are down 1,800 feet or more and live amid steep underwater mountains. To prevent crab pots from tumbling down cliffs and getting lost, the fleet attaches them to longlines, “Rather than fishing one pot per buoy like other crab fisheries in the Bering Sea, the Aleutian fleet attaches 20-30 pots to a to a line that can be retrieved,” Lloyd said A $25,000 grant from the Bering Sea Fisheries Research Foundation paid for the test crab pots. The Aleutian Islands golden king crab fishery begins Aug. 15 and can run through February.   LAPP lapse IFQ holders will have a tougher time with any appeals issues and it will all be dealt with long distance. The laws that govern fishing limited access privilege programs, or LAPP, include an appeals process for fishermen who are eligible to receive shares of the fish. LAPPs are basically limited entry programs such as Individual Fishing Quotas (catch shares) for halibut and sablefish and Bering Sea crab. “It’s nothing new to Alaska. It’s been happening for over 30 years with the Alaska limited entry commission,” said Phil Smith, a retired limited access manager at NOAA Fisheries in Juneau. Among other things, Smith devised the appeals process for IFQ programs that began in Alaska in 1995. “That was a massive program with 8,000 applicants and built into the system was an administrative appeals process to make the determination if people were not eligible for any IFQ, or for as much as they wanted. There was a formal opportunity for people to appeal in the Juneau office at NMFS where they were treated fairly and got full due process. We handled hundreds of such appeals, some frivolous, some with merit,” Smith said. But the IFQ appeals process has changed. Two years ago the Alaska office was “centralized” and moved to federal headquarters in Maryland. At the same time, the new National Appeals Office devised a new list of regulations to govern the process. Smith called the new rules “punitive and non-user friendly” and said “it puts total control into the hands of a far away adjudicator.” Public comment on the appeals process ended June 9 and it may or may not make it to the law books. Smith said his advice is to pay attention. “I know the halibut charter catch share plan is coming down the pike... That is going to bring rise to certain entitlements and appeals — there always are with these things — and I would think that all of us in Alaska want our fishermen to be treated as fairly as possible.”

Editorial: King closures expose double standard on bycatch

A fisheries management nightmare is playing out across the state caused by weak king salmon returns. The social and economic harms have yet to be calculated, although we have no doubt they are immense. Sport and subsistence king fisheries have been shut down. The East Side setnetters on the Kenai and Kasilof rivers have been shut down as sockeye surge past the beaches. Commercial chum salmon runs in Western Alaska have been restricted and new fishing gear required — all to avoid killing any king salmon. Meanwhile, the Gulf of Alaska pollock fleet is about to hit the waters with an allocation of 14,527 king salmon as bycatch for the C and D seasons that begin Aug. 25 and Oct. 1. The Bering Sea pollock fleet, with until Oct. 31 to catch the rest of a 1.2 million metric ton quota, still has an allocation of 17,741 king salmon remaining as of July 14 with one-third of the harvest to go. To be clear: this is not meant to be an attack on the pollock industry, which is without question an important part of the Alaska economy. The Journal is not anti-pollock or anti-trawl fleet. What we are is pro-accountability, and in this time of extreme conservation measures nobody can escape their fair share of it. We find no fault in the fleet advocacy on behalf of its membership, which has entirely legitimate arguments. For instance, ocean conditions could naturally have a greater effect on productivity than interceptions, and it is true that the amount of salmon bycatch is indeed miniscule compared to the 1.2 million metric ton quota of pollock in 2012. However, consider the “bycatch” of king salmon taken by the East Side setnetters (which really isn’t bycatch because it can be commercially sold while pollock fleet takes cannot). In 2011, this group of setnetters caught more than 2 million sockeye compared to 8,356 king salmon, or a rate of 0.4 percent. Like the Bering Sea pollock fleet, that’s a pretty low rate, but they are still shut down because indications are not even the minimum escapement will be met for kings on the Kenai. King salmon conservation measures cost the setnetters about 500,000 sockeye from their historical split in 2011, or about $4.5 million in dockside value, and the 2012 closure to the East Side setnetters could wind up costing this group $20 million. The potential harm often cited by the pollock fleet in fighting against bycatch controls certainly stands in stark contrast to the very real economic devastation now being felt by salmon fishermen of all types around the state. While we don’t quarrel with the pollock fleet’s right to advance its interests, with its advocacy comes the need to either downplay or deny any impacts of bycatch on Alaska salmon runs. Again, this is their job, but their interests don’t always coincide with the public interest. This is where the federal regulators on the North Pacific Fishery Management Council are supposed to play their role. While drawn by design from industry stakeholders, their job is not to vote a constituency, but to use their knowledge of the fishery to make an informed decision. It is not an unreasonable observation that the trawl fleets for both pollock and groundfish wield major — and often decisive — clout at the council when it comes to management of salmon, halibut and tanner crab that are prohibited species catches for them. Nor is it unreasonable to note the glaring contradiction inherent in directed users being barred from even catching and releasing a single king salmon while a prohibited species user group catches them by the thousands. It may be true that the marine environment is a greater force than the pollock fleet in salmon abundance, but that only makes conservation of the kings that are out there more important. To argue that bycatch is not significant at a time of low productivity is to simultaneously ignore the disproportionate impact bycatch can have in such a period as well as the conservation burden now being borne by the direct users. The pollock fleet may argue that it isn’t practical or realistic to even consider shutting down their fishery as a conservation measure. A few months ago, the East Side setnetters would have probably said the same thing.

D.C. must deliver on nation's priorities — jobs, transportation, energy

Bashing Congress for its inability to get things done has been an American pastime for the 236 years as a nation we just marked on Independence Day. Now, in my fourth year as one of Alaska’s U.S. senators, I share Americans’ frustrations with Washington, D.C., being out of touch and seemingly unable to address our country’s enormous problems. So it comes as a pleasant and little noticed surprise the U.S. Senate in recent months actually has passed significant legislation which – if the House will only vote on several backed-up bills – will create millions of American jobs, including for Alaskans. The most important is reauthorization of funding for America’s transportation facilities – highways, bridges, ports and ferries. In March, the Senate on a 74-22 bipartisan vote, agreed to invest $109 billion into the nation’s deteriorating transportation network, supporting 2.9 million jobs. The measure is especially important for Alaska by paying for $1 billion worth of projects over the next two years, which will create or protect nearly 19,000 Alaska jobs. I was pleased to ensure key provisions for Alaska were included, such as nearly $50 million annually for rural roads, Denali Commission reforms, $67 million for ferries and van-pooling incentives. Our congressional delegation, led by Congressman Don Young, worked hard to protect $31 million for the Alaska Railroad, which some misguided senators had proposed eliminating. After refusing to act for four months, the U.S. House finally passed the transportation bill in late June, sending it to the president for final approval. Fortunately for college students across the nation, the House also agreed to the Senate-passed extension of affordable student loans. With the interest rate scheduled to double on July 1, final congressional action means loan rates will remain at 3.4 percent. As the former chair of the Alaska Student Loan Corporation, I worked hard to prevent the rate jump, which would have cost thousands of students in Alaska and across the country an additional $1,000. Another significant jobs measure is the Farm Bill, which supports 2.9 million jobs while cutting many bloated farm subsidies. For Alaskans, the fully paid for bill protects essential rural water and wastewater projects, expands disaster loans to shellfish and finfish harvesters and ensures that 91,000 Alaskans who rely on federal nutrition assistance remain healthy. In April, Senate Republicans and Democrats overwhelmingly passed comprehensive reform of the Post Office, which is losing billions of dollars. I fought hard to prevent the closure of 31 Alaska post offices and against an effort by Arizona Sen. John McCain to eliminate our Bypass Mail Program, which preserves the critical link to rural Alaska. Our bill puts the Post Office on solid financing footing. Yet another significant bill passed by the Senate this spring was the Violence Against Women Act. This landmark legislation funds efforts by communities and local law enforcement to prevent domestic violence. Shamefully, Alaska leads the nation in rates of domestic violence and child abuse. That’s why I fought to ensure Alaska tribes retain their authority to deal with domestic violence. I also have introduced separate legislation to create demonstration projects in nine Alaska villages to give rural communities more tools to fight alcohol, drug and domestic violence cases. Despite the enormous jobs-creating and other beneficial provisions, the Farm Bill, Post Office Reform and Violence Against Women measures remain bottled up in the House. We senators have been able to find bipartisan compromises to address some of the nation’s problems, so I’m hopeful House members will deliver for their constituents. In coming weeks, the Senate will be focused on growing the economy. First up is a measure to provide incentives for small businesses to add jobs. Economists say our proposal – a 10 percent income tax credit on new payroll – will help small businesses add new workers. We also want to crack down on companies out-sourcing jobs abroad. Our Bring Jobs Home Act provides companies a 20 percent tax credit for costs associated with returning jobs to America and eliminating tax loopholes for those who ship jobs overseas. Congress must work across party lines to get America’s economy moving again. Mark Begich is the junior senator from Alaska.

Editorial: Note to Politico: Fairbanks isn't 'nowhere'

The State of Alaska received welcome news at the end of June when Congress agreed on a two-year surface transportation bill that largely preserved annual federal funds for the Alaska Railroad Corp. Under the Senate version passed in March, the railroad was in danger of losing $30 million of the $36 million annual Federal Transit Administration funding it has received since 2006. The potential loss of funding put everything from hundreds of jobs, passenger service and the ability to repay $137 million in capital improvement bonds at risk. Well, Rep. Don Young was appointed to the conference committee and he won back nearly all of the funding cut, securing $31 million annually for the Alaska Railroad that will allow the company to continue capital projects, pay its debts and preserve passenger service. Apparently that didn’t sit too well with those ever-vigilant budget hawks at Politico, a Washington, D.C., news organization that started off as a relatively balanced outfit but is now indistinguishable from the rest of the left-leaning media who run interference for Democrats and President Barack Obama. In a July 10 piece headlined “Don Young’s Railroad to Nowhere,” Politico described the FTA funds as a “cash gusher” for the railroad and that Young pulled off a “trick” to preserve the money despite the House of Representatives ban on earmarks. This of course will come as news to the insulated cocoon of D.C. reporters, but Fairbanks isn’t nowhere. Denali National Park isn’t nowhere. Neither are Seward or Anchorage. It also may come as news to the crack Politico team that contrary to their reporting, the FTA funds are not dedicated to “mass transit” or “commuter” rail. The authorizing legislation requires an entity to be a “local government authority” — which the Alaska Railroad is — and that it offer “public transportation” — which it does. And in terms of bang for the buck, the Alaska Railroad delivers by supporting the state supply chain carrying jet fuel to our military bases and international airport, and transporting coal exports that reduce our trade deficit. The railroad is vital to deploy our military, and while the Politico hacks may scoff at the tourists who ride it, they represent hundreds of thousands of foreign visitors who come to this country to spend far more money than Congress just appropriated. Meanwhile, these same jokers at Politico reassure us that based on their review of $16 billion in Department of Energy loan guarantees that were part of the 2009 stimulus bill that didn’t stimulate anything but the national debt clock — “it’s too soon to judge the success or failure of most of the 26 projects that received aid.” That’s some hard-hitting stuff right there. That information came in an article reporting on Abound Solar, which went bankrupt last month after receiving a $70 million loan guarantee from DOE. This follows on the collapse of Solyndra, Obama’s poster child for green energy loans — coincidentally owned by Obama bundler George Kaiser — after it received $535 million in DOE loan guarantees. Then there’s Fisker, which has received $193 million from DOE to build a hybrid sports car. The company has laid off 100 workers around the country in an effort to get more of that sweet, sweet DOE cash because so far it has missed all its sales and development milestones. When Consumer Reports tried to evaluate the Fisker Karma (a deliciously ironic name, no?), the car wouldn’t start. So while it’s “too soon to judge” a DOE program that blew $800 million tax dollars on just three companies, Politico turns its fire on Young and the Alaska Railroad to make a cheap headline out of easy targets. Nevermind you could run the Alaska Railroad for 25 years with the amount of money Obama’s DOE has blown on three companies in less than two. Thanks to Young, the Alaska Railroad will still be here in 25 years. Solyndra won’t be, even though we’ll probably still be paying interest on the debt that funded this and every other “green” fiasco funded by the current administration. The only thing going nowhere is Politico’s credibility.

Commentary: Debris survey under way; salmon product smoothes skin

Marine debris trackers are taking to the air any day to get a better idea of where and what is washing ashore from last year’s devastating tsunami in Japan. Best “guesstimates” claim at least 1.5 million tons of debris are afloat on and under the current driven waters that routinely cover Alaska coastlines. The State has funded a $200,000 systematic aerial survey by Airborne Technologies Inc. of Virginia that will span waters and beaches from Cold Bay to Ketchikan to get a more complete view of the debris problem. “That should give a good picture of where the debris is concentrated and some idea of the makeup and quantities of it,” said Merrick Burden, executive director of the Marine Conservation Alliance. “That allows us to have the next conversation about what is it we are really talking about — is it a $1 million or a $40 million problem? Then we can start putting together a plan of attack. Right now we don’t have that level of information.” The MCA Foundation took the lead on debris tracking and radiation monitoring efforts in January when sightings began appearing a year earlier than expected. The group deployed experienced clean-up contractors over several months to multiple beaches at Sitka, Craig, Yakutat and Kodiak where debris was most likely to hit first. A report released last week said while heavy snow was a hampering factor in all regions, seven trips to Craig showed patterns of early debris; 12 trips to Sitka yielded 1,600 pounds of mostly Styrofoam debris, and 34 percent of the debris found in June was tsunami related. At Yakutat, in 10 trips, the crew hauled away 95 large Styrofoam blocks and 52 floats, along with 48 large black buoys; seven trips to Kodiak were foiled by bad weather. No radiation was detected at any of the Alaska sites. The amounts of Styrofoam are very worrisome, Burden said, because it breaks up into tiny particles that look like food and can be deadly when it accumulates in fish and birds. Much of what is coming ashore now are lightweight, wind driven objects, but many unknowns are riding below the surface. “What we do know is that it will be a different type of debris,” Burden said. “The next level will be more submerged and we don’t know what it will be, although it is likely to be docks and things of that nature like we have seen on the West coast. The third category should be almost entirely underwater and driven by currents. That will be something else entirely.” Meanwhile, questions remain over who will fund further debris monitoring and clean up efforts. “When it comes to the state and federal response, we see a bit of a road block,” Burden said. “There is an information gap that needs to be filled. Right now we have a lot of questions about the scope of the debris problem. With the aerial survey we can acquire enough information and data to put together a plan and that should get things moving.” The MCA Foundation plans to begin a “hot spot” clean up in Alaska by mid-September. Mariners can report debris sightings and see pictures of cleanup efforts at www.facebook.com/seaalliance. Find the marine debris report at www.marineconservationalliance.org.   Deadline sticks Fishermen and Alaska Native groups are jubilant at the Environmental Protection Agency’s refusal to extend the 60-day public comment period on its draft watershed assessment of the Bristol Bay region beyond July 23. The extension was requested by the Pebble Partnership and had the support of the Parnell administration. The EPA said in a draft assessment in May that the possible failure of a dam holding waste from a large scale mine near the headwaters of the world’s largest sockeye salmon fishery could wipe out or degrade rivers and streams in the region for decades. Since then the agency has held hearings in six Bristol Bay communities, as well as in Anchorage and Seattle. Nearly 2,300 people attended the meetings and provided more than 450 oral testimonies. More than 90 percent of the people at the Bristol Bay region meetings supported the watershed assessment and the current timeline, according to Bristol Bay Native Corp. “We commend the EPA for recognizing that further delay would not be beneficial,” said Jason Metrokin, President and CEO of BBNC. “It was the right thing for EPA to stay with their original timeline. There is overwhelming support for the Watershed Assessment,” said state Rep. Bryce Edgmon, who represents the region in the Alaska Legislature. Senator Lisa Murkowski was not pleased. She said in a press release that the July 23 deadline “doesn’t allow for Alaskans to offer their comments because of the busy summer season” and that “it demonstrates, once again, that the agency does not understand Alaska.” To the contrary, Sen. Mark Begich said he believes the public has ample time to have their say. “Believe me, Alaskans have never had a problem giving their opinions and meeting a deadline,” Begich said in a phone interview. Opponents to the Pebble mine are urging the EPA to use its power under the Clean Water Act’s to protect Bristol Bay from future large-scale mining developments. Since 1972, when the Clean Water Act became law, the EPA has used this authority 13 times. The EPA will provide another opportunity for public comment during a peer review meeting for the draft watershed assessment in Anchorage on August 7. The 12-member peer review panel will accept comments on several “charge” questions relating to the science used in the assessment. For more information and to read the charge questions, visit https://federalregister.gov/a/2012-13431. Submit your comments through July 23 at www.epa.gov/region10/bristolbay   Salmon skin cream A chance discovery by farmed salmon hatchery workers has spawned a line of skin care products that keep skin softer and younger looking. “Aquapreneurs” in Norway became curious several years ago after it was noticed that hatchery workers who spent long hours handling salmon fry in cold seawater had softer, smoother hands. Researchers at Norway’s University of Science and Technology discovered the skin softening component came from the enzyme zonase, found in the hatching fluid of the salmon eggs. The enzyme’s task is to digest the protein structure of the tough egg shells without harming the tiny fish. The scientists hailed this dual ability as the secret behind the beneficial properties for human skin. Now, Norway-based Aqua Bio Technology, which develops marine based ingredients for the personal care industry, has launched the zonase infused product as Aquabeautine XL to make the name more user friendly, and it has signed with a major distributor in South Korea. The product also is available in Europe. Another personal care product using salmon hatching fluid is also set to be launched at the end of the year, according to ABT’s website. (See more at www.aquabiotechnology.com/)   Salmon jam! Check out three days of fish and music at Salmonstock, Aug. 3 to Aug. 5 in Ninilchik.

Editorial: Coastal Villages uses coercion to score points for pollock

Something stinks in Southwest Alaska. By now you’ve probably heard about the weak king salmon runs around the state causing widespread closures to subsistence, sport and commercial fishermen. You also may have heard about the “Kuskokwim Rebellion” on June 20 when fishermen took to the waters in defiance of an extended subsistence closure by setting their nets at the end of the original seven-day period agreed upon in the preseason. Alaska Department of Fish and Game enforcement seized 1,800 pounds of fish and 21 nets, and when it did allow fishing it required six-inch mesh gear that isn’t widely possessed in the region. Into this desperate need stepped Coastal Villages Region Fund, the Community Development Quota group for the Kuskokwim region. CDQ groups are six tax-exempt organizations in Western Alaska representing 65 villages that receive 10 percent of the Bering Sea fishing quotas annually, including pollock, crab and halibut. Coastal Villages handed out 100 legal nets a week after the Rebellion at the request of the Association of Village Council Presidents, which includes all 20 CVRF communities and the 56 federally recognized tribes in the Kuskokwim region. But the nets were far from free. In order to receive a net from CVRF, fishermen had to sign an acceptance statement acknowledging the nets were being provided at the request of AVCP and paid for by revenue from the pollock fishery where bycatch of king and chum salmon has caused controversy for decades. The one-page statement included two paragraphs on salmon bycatch in the pollock fishery, including the claim that “the best available science shows that the pollock fishery is not a significant contributor to our salmon problems.” This statement authored by CVRF Chief Operations Officer and former pollock industry lobbyist Trevor McCabe is at best misleading, and forcing fishermen to sign it amid a disastrously weak king salmon run with their lives on the line is contemptible. We know the outrage would be off the charts if the Department of Fish and Game required anyone who wanted a king salmon stamp to sign a piece of paper saying that bycatch has nothing to do with poor returns around the state. What Coastal Villages is doing is no different, and the anger should be no less at the coercive action it has taken to extract supportive statements of the pollock fishery from the people it is supposed to be serving who are seeking to fulfill the most basic human right of subsistence. One thing is certain: the residents of Coastal Villages communities already own those nets, and they shouldn’t have to prove anything other than where they live to receive one. Neil Rodriguez of CVRF, who didn’t want his interview with Bethel radio KYUK to be recorded, told the station the claims about bycatch not being a significant contributor to salmon issues was based on an environmental impact statement, presumably the one prepared for the 2009 federal action to cap king salmon bycatch in the Bering Sea at 60,000. In fact, that EIS contains no such claim, and actually states that salmon bycatch “may be a contributing factor to the decline of chinook salmon” in Western Alaska but that the science is incomplete and prevents any definitive conclusions. While recognizing that cutting bycatch would not rebuild salmon runs, the EIS stated that every additional fish in-river would still benefit all users and aid managers in hitting escapement goals as well as meeting our treaty obligations on the Yukon with Canada. That same EIS also states that half or more of the Bering Sea king salmon bycatch is of Alaska origin, and genetic stock composition analysis released this past January based on 2010 sampling suggests it could be even higher. We caution that the 2010 sampling cannot be extrapolated to the entire bycatch. However, 94 percent of the 702 king salmon tested from the winter “A” season were of Alaska origin. Coastal western Alaska stocks represented 41 percent, and middle and upper Yukon stocks another 36 percent. For all 2010 samples, 87 percent were of Alaska origin. As of 2011, there is 100 percent observer coverage and full retention in the Bering Sea allowing for a rigorous sampling protocol that will more definitively establish origins for salmon bycatch. But until then, the stock composition released in January is the “best available science,” and it shows Western Alaska salmon are a significant portion of the bycatch, if not the majority of it. The CVRF “acceptance statement” then goes from misleading to flat-out dishonesty. It states that CVRF caught only 320 kings in the pollock fishery in 2011 and that “many were not from Western Alaska.” As we just discussed, nobody yet knows the composition of 2011 bycatch, so that CVRF claim holds less water than the nets it is distributing. Further, CVRF did not count the king salmon bycatch from five pollock trawlers it acquired along with the Norton Sound CDQ group in February 2011. According to 2011 cooperative reports, the CVRF 341-foot catcher processor Northern Hawk and the five other trawlers took 599 king salmon in addition to 13,121 chum salmon. The six CVRF vessels also spent a total of 19 weeks on the “dirty 20” list in 2011 for posting the highest rates of chum salmon bycatch. By volume, the Bering Sea pollock fishery is one of the cleanest on the planet, but that does not change the fact that Alaskans will never value pollock more than they do salmon. What is also indisputable is that the CVRF position on salmon bycatch that it required its residents to sign in exchange for a fishing net is in direct opposition to that held by the Alaska Federation of Natives, AVCP, the U.S. Fish and Wildlife Service, the U.S. Department of State, the Alaska Board of Fisheries, the Tanana Chiefs Conference, the Yukon River Drainage Fisheries Association, the Yukon River Panel and the Federal Subsistence Board. The CVRF statement also contradicts Calista Corp., the Alaska Native regional corporation for the Kuskokwim region. In a commentary published July 9 in the Tundra Drums, Calista President and CEO Andrew Guy wrote, “Perhaps the largest concern we share with the region is the bycatch from commercial fishing. The tremendous scale of bycatch is a major issue for the region, and our people feel that more attention and scrutiny is warranted.” CVRF, in the acceptance statement, reiterated its official slogan that “Pollock provides.” Pollock provides all right. It provided for CVRF President and CEO Morgen Crow to receive a salary of $832,000 in 2010 and to buy a 3,476-square foot, five-bedroom house in Anchorage worth about $1 million in 2009. Between Crow, McCabe ($504,000) and Chief Financial Officer Richard Monroe ($477,000), the top three employees of CVRF in Anchorage made a combined $1.8 million in 2010. These salaries paid to executives at a tax-exempt organization with a humanitarian mission are outlandish on their face, and become even more so when put in the context of the CVRF statements that pollock revenue subsidizes its crab, salmon and halibut operations. We have a hard time seeing how Crow, McCabe and Monroe can justify their lavish salaries based on the fact only one segment of their business manages to turn a profit. We also aren’t buying the claim that the acceptance statements are for education purposes. If the effort were purely educational, CVRF can hand out the information on bycatch or mail it to every resident in the region. By trading the net for a signature, CVRF gives every indication it is up to something else. A 10-year review of the CDQ program by the State of Alaska is under way right now. Whether CVRF is meeting its obligations or abusing its power is a question the review must answer.


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