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CONTENTS JANUARY 2020 | VOLUME 36 | NUMBER 1 | AKBIZMAG.COM
FE AT UR E S 8 OIL & GAS
24 CONSTRUCTION
At the End of the World…
State and Federal Funding Contribute to 2020 Construction
Deadhorse Aviation Center is a one-stop-shop and home-away-from-home By Amy Newman
Routine maintenance of public buildings continues to be deferred
12 TELECOM & TECH
By Vanessa Orr
The Future of 5G for Alaska The Last Frontier at the forefront of technology By Tracy Barbour
18 FINANCE
State's Economists Weigh in on 2020 Outlook Construction, oil & gas, transportation are bright spots; heathcare, retail experience challenges By Isaac Stone Simonelli
28 PROFESSIONAL SERVICES Hiring (and Keeping) the Right Employees
New employment trends mean more, unique benefits
© Ted Meyer | Alaska DOT&PF
By Tracy Barbour
46 ALASKA NATIVE
58 OIL & GAS
Regional and village corporations in mutually beneficial land, resource agreements
Alaska's public and private entities continue to explore options to bring North Slope LNG to market
66 TOURISM
Backcountry Riding on a “Snow Pony” Snowmachines offer visitors a close-up view of the best of Alaska By McKibben Jackinsky
Wayne Miller | Rogue Photography
Long-Term Relationships
Rescuing Alaska’s Stranded LNG
By Vanessa Orr
By Tasha Anderson
52 MINING
62 CONSTRUCTION
Specialty expertise supports safer, more efficient mining operations
The Remote Recreational Cabin Sites program helps residents build their dreams
Digging into Geotechnical Engineering By Isaac Stone Simonelli
Keeping Alaska’s Pioneering Spirit Alive By Sam Davenport
QUICK READS 70 BUSINESS EVENTS
74 INSIDE ALASKA BUSINESS
78 ALASKA TRENDS
72 COMMUNITY EVENTS
76 RIGHT MOVES
80 OFF THE CUFF
4 | January 2020
Alaska Business www.akbizmag.com
CONTENTS JANUARY 2020 | VOLUME 36 | NUMBER 1 | AKBIZMAG.COM
JUNIOR ACHIEVEMENT SPECIAL SECTION 34 INTRODUCTION Celebrating 33 Years of Junior Achievement
JA inducts 2020 Alaska Business Hall of Fame Laureates
35 BOARD OF DIRECTORS
Junior Achievement of Alaska Board of Directors 2019-2020
41 DEENA BISHOP
2020 Junior Achievement Hall of Fame Educator of the Year
41 DONORS
2020 Junior Achievement Hall of Fame 2019-2020 Donors
43 MATT BROWN
2020 Junior Achievement Hall of Fame Volunteer of the Year
On the books, Marx Bros. Café is a restaurant, but for decades Alaskans have frequented Marx Bros. not just to eat but to celebrate—anniversaries, birthdays, promotions, and any other special occasion. Richard “Van” Hale and Jack Amon, 2020 inductees into Junior Achievement’s Alaska Business Hall of Fame, have worked tirelessly since 1979 to ensure every guest they serve, whether celebrating a new job or a girls’ night, feels the magic of their moment. Cover Photo by Kerry Tasker
6 | January 2020
Junior Achievement
ABOUT THE COVER
36 MARX BROTHERS
42 DAVID LAWER
40 R AIN PROOF ROOFING
44 A ARON SCHUTT
2020 Junior Achievement Hall of Fame Laureates
2020 Junior Achievement Hall of Fame Laureates
2020 Junior Achievement Hall of Fame Laureate
2020 Junior Achievement Hall of Fame Laureate
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VOLUME 36, #1 Published by Alaska Business Publishing Co. Anchorage, Alaska
EDITORIAL STAFF Managing Editor
Kathryn Mackenzie 257-2907 editor@akbizmag.com Associate/Web Editor
Tasha Anderson 257-2902 tanderson@akbizmag.com Digital and Social Media Specialist Arie Henry 257-2906 ahenry@akbizmag.com Art Director
Monica Sterchi-Lowman 257-2916 monica@akbizmag.com Art Production
Linda Shogren 257-2912 production@akbizmag.com Photo Contributor
Kerry Tasker
BUSINESS STAFF President
Billie Martin VP & General Manager
Jason Martin 257-2905 jason@akbizmag.com VP Sales & Marketing
Charles Bell 257-2909 cbell@akbizmag.com Senior Account Manager
Janis J. Plume 257-2917 janis@akbizmag.com Advertising A ccount Manager
Christine Merki 257-2911 cmerki@akbizmag.com Accounting Manager
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Emily Olsen 257-2914 emily@akbizmag.com 501 W. Northern Lights Boulevard, Suite 100 Anchorage, Alaska 99503-2577 Toll Free: 1-800-770-4373 (907) 276-4373 www.akbizmag.com Press releases: press@akbizmag.com
ALASKA BUSINESS PUBLISHING CO., INC. Alaska Business (ISSN 8756-4092) is published monthly by Alaska Business Publishing Co., Inc., 501 W. Northern Lights Boulevard, Suite 100, Anchorage, Alaska 99503-2577; Telephone: (907) 276-4373; © 2020 Alaska Business Publishing Co. All rights reserved. No part of this publication may be reproduced without written permission from the publisher. Alaska Business accepts no responsibility for unsolicited materials; they will not be returned unless accompanied by a stamped, self addressed envelope. One-year subscription is $39.95 and includes twelve issues (print + digital) and the annual Power List. Single issues of the Power List are $15 each. Single issues of Alaska Business are $4.99 each; $5.99 for the July & December issues. Send subscription orders and address changes to circulation@akbizmag. com. To order back issues ($9.99 each including postage) visit simplecirc.com/ back_issues/alaska-business.
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FROM
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New Year, New Decade, Same Economy? Happy New Year and New Decade! To help keep you from falling into the post-holiday doldrums, we’ve put together a very special issue of Alaska Business focused on the next generation of business professionals, the students of Junior Achievement (JA), and some of the talented people who have been contributing to the business community in one way or another for decades. And they aren’t working just to further their own success: each of the Alaska Business Hall of Fame Laureates is helping to guide the state’s young people to a successful, fulfilling future through mentorships, volunteer work, philanthropy, internships, donations, and… you get the idea. Read all about this year’s inductees and their incredible accomplishments in the JA special section in which we also place a spotlight on educators and volunteers who go above and beyond. We talk a lot in the business community about the importance of mentoring and making ourselves available to help guide our children to success. The key to successful mentorships and internships and, in turn, students and new graduates is to turn words into action. Most everyone agrees in theory that students who participate in programs such as JA are more likely to not just succeed but excel in the workforce, but we have to put theory into practice in order to make a real difference. Time is a precious commodity, but so are the eager students and graduates looking to us as role models. Each of this year’s laureates (and past laureates) exceed at being professional role models—and for that we say, thank you! Also in this issue we present our annual economic forecast. It’s been a cloudy couple of years for economic predictions. Who knew that the majority of last year would be spent waiting for the legislature and governor to come to some sort of agreement as to just how much money would be cut from the budget? The state was predicted to emerge from this multi-year recession last year as oil production and prices recovered, but budgetary squabbles kept the economy (and its forecasts) depressed. According to state experts, this year’s outlook is once again cautiously optimistic. Some words begin to lose meaning if they’re uttered enough, and we’ve heard “cautiously optimistic” a whole lot lately, but we have hope that the state’s major industries, in particular oil and gas, tourism, and transportation, will help propel Alaska back to economic health in 2020. We welcome this fresh new year, not with cautious optimism, but with hope and excitement. Alaska Business
Kathryn Mackenzie Managing Editor, Alaska Business
We talk a lot in the business community about the importance of mentoring and making ourselves available to help guide our children to success. The key to successful mentorships and internships and, in turn, students and new graduates is to turn words into action. January 2020 | 7
OIL & GAS
At the End of the World…
Deadhorse Aviation Center is a one-stop-shop and home-away-from-home By Amy Newman The US military utilizes DAC services when conducting winter readiness exercises in Deadhorse. Deadhorse Aviation Center
W
eather conditions in Deadhorse make it the ideal setting for the US military’s winter readiness tests. And the Deadhorse Aviation Center (DAC) is the perfect base of operations. “We have the infrastructure and support staff to help them out,” says Timothy Cudney, who has served as director of the DAC since 2013. “We have the hangars and the meals; we’ve had times where we’ve had 150 soldiers sleeping on the floor in the hangar, with the command team in the regular DAC offices and accommodations.” Cudney says the military exercises take place every other year, and next month will be the fourth he’s seen since he came onboard. The military sends a staff of roughly 50 to Deadhorse ahead of the exercise to set up, with DAC staff on standby to assist as needed. “It’s all quiet on the western front until 50 show up, and then another 150 show up,” he says. That was the case during a February 8 | January 2020
exercise a few years ago, when temperatures at altitude were -60˚F. About 160 paratroopers were flown out to jump, after which they trekked across the Arctic tundra to the DAC to rest, warm up, and have a meal in the dining hall, Cudney says. The exercises are routine for the military, but they can still surprise DAC staff. “Here we are waiting for them all to come in, and we see them being carried in with frostbite, broken ankles, and back injuries from landing on their tailbones,” Cudney recalls. The military isn’t a regular presence at the DAC, Cudney says, but they highlight the uniqueness that accompanies running an Arctic aviation center located at “the end of the world.”
Shell Game Situated at the end of Deadhorse Airport’s Runway 5, the DAC was originally conceived as a single-client, multi-purpose facility to support Shell
Oil Company’s offshore activities in the Beaufort Sea, says Rick Fox, CEO of Fairweather, which co-owns the DAC with Offshore Support Services (an Edison Chouest company) and Kaktovik Iñupiat Corporation. In 2006 Sherron Perry, Fairweather’s founder and first CEO, and Shell entered into an agreement for Fairweather to build the DAC, with construction beginning that year. But when the Ninth Circuit Court of Appeals placed an injunction on Shell’s exploration activities the following year, the oil giant negotiated out of the lease, leaving a building with no tenant. “At that point, the building was closed in but there was no build out in the interior,” Fox says. “So, you just had a metal building. A nice metal building, but just a metal building on one lot.” The unfinished building sat dormant until the Chouest family, owners of Edison Chouest Offshore, a Louisianabased provider of marine transportation solutions seeking to expand its
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operations and establish a presence in Alaska, purchased a majority share of the DAC from Fairweather. “The Chouest family had been interested in going into business in Alaska because they saw the long-term value of the offshore exploration,” Fox says. In 2011 Fairweather hired Fox, recently retired from Shell, to help build out the facility. With Shell out of the picture, Fairweather had to modify its original concept. “We changed the concept from a single client to a multi-client and retained the multi-purpose use,” Fox explains. “We built the building we thought would best serve the North Slope for all clients, rather than what Shell had in mind.” Architects Alaska designed the at-thetime 70,000-square-foot facility, which contains an ergonomically designed hangar, airport terminal, medical facility, multiple secure office suites, tenant and staff housing, dining facilities, and a logistics center. Ukpeaġvik Iñupiat Corporation out of Utqiaġvik served as general contractor, with other local contractors assisting. Construction was completed in 2012. But because the DAC was a rare speculative buildout, it still had no tenants. “The typical model is to have a contract in hand before you attempt something like this,” Fox says. “Since there was already a building, we had a choice of letting the building sit empty and wait for a business or build something that we thought would work and go after the business. We chose the latter.” It took time, but the DAC’s vision and patience paid off. GCI, which supported the engineering and design for the DAC’s technology rollout, was the first to move in. The telecommunications company has operated in Prudhoe Bay for more than thirty years and was previously typically housed by the oil field companies, says Rick Hansen, GCI’s vice president of engineering and operations. Changes to their work model, however, left them in need of an independent space. “When we moved to a customer-neutral environment, we still didn’t have a space that enabled us to be independent to the oil producers while still being actively engaged with all our customers,” Hansen says. “One of the largest issues with past leases was the quality of rooms, food, and accessibility after hours. The DAC was a
perfect fit to move our operations into, while still being very close to all our dayto-day customers.” Today, Fox estimates the DAC has eight long-term tenants and another thirty to forty ad hoc clients, like the military, researchers, and universities, who use the center on an as-needed basis.
Fixed Base of Operations Although the DAC shifted focus from a single- to multi-client operation, its primary focus of providing safe, efficient aviation services to oil companies and their suppliers remains the same.
“We serve as an FBO—a fixed base of operations—so if a corporate jet, charter flight, or executive plane flies up, we’re the ones that serve them while they go do their business on the North Slope,” Fox says. Two hangars are available for the public, private, and charter planes that fly in and out of the DAC. The 16,000-square-foot west hangar is fully equipped with safety, fire suppression, and internationally approved environmental features and can accommodate two or three large helicopters or smaller fixed-wing
Thank you, Alaska. BP has had the privilege of working in this state since 1959. It’s been an honor to be part of your community and your lives. This state, and these people, will always be part of the fabric of our company. We sincerely thank you all for the time we’ve shared.
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January 2020 | 9
Deadhorse Aviation Center
aircraft. The 12,000-square-foot east hangar can accommodate private jets, single and twin-engine prop planes, and helicopters; in addition, it has a combined 4,000 square feet of office and lounge space. The terminal complies with Department of Transportation security requirements and offers passenger and baggage screening and handling of secure baggage and cargo. The twentyfour bedrooms and twenty-four suites each have private baths, while kitchen facilities and a dining hall can feed sixty guests. Secure office suites and a private conference room are equipped with video conference capabilities and Wi-Fi. Because no other business operates in Prudhoe Bay outside of the oil and gas industry, the majority of the DAC’s clients are either oil and gas providers or suppliers who support their activities, Cudney says. But some ad hoc users fall outside oil and gas, he adds, which can provide interesting experiences for staff. In addition to the military, researchers from the US Geological Survey conduct polar bear surveys out of Deadhorse, Cudney says, and DAC staff have been able to accompany them on some counts. The Federal Aviation Administration houses its weather cams on the building and occasionally asks staff to clean them. “We’ll get a call to get some Windex and go clean the camera lens,” Cudney says with a laugh. “With all the technological advancements, they want us to clean it with some Windex and a lint-free cloth.”
Adapt to Succeed One of the key aspects of the DAC’s success is its ability to meet both the 10 | January 2020
actual and anticipated needs of its target users. “Without having the clients, we had to be flexible going in,” Fox says of the DAC’s approach to determining what services to offer. “We had to figure out what would work for the people we were trying to serve and make adjustments, and we did.” The heated jetway DAC installed in 2015 is one example. The first of its kind in the US Arctic, the fully enclosed jetway was designed specifically for use in the harsh Arctic climate to increase passenger safety and comfort. “One of the big selling points was passenger safety,” Cudney says of the push to build the jetway. “We didn’t want people leaving a warm environment to walk fifty yards to the terminal in the cold and wind. The exposure to having someone slip and fall was astronomical. The jetway is much safer.” That flexibility and willingness to work with clients was a factor in Alaska Airlines’ decision to route its daily flight service in and out of Deadhorse through the DAC rather than upgrade its existing terminal, Alaska Airlines’ Regional Vice President Marilyn Romano says. Alaska Airlines’ Deadhorse terminal was originally part of the company’s 2020 Great Land Investment Plan, a three-year, $100 million initiative for maintenance, facility upgrades, and improved air-cargo service, she says. “Toward the end of that cycle, our options were to remodel the [terminal] we had or tear it down and rebuild it,” Romano says. But a new option presented itself when Alaska Airlines entered into a contract with BP Alaska to transport oil field commuters. After extensive
©Judy Patrick
The DAC is equipped to screen passengers and baggage and handle secure cargo.
discussions with the DAC, the airline ultimately decided that leasing space, rather than undergoing a complete redesign of its terminal, was the better option and began daily flight service in late October. The experience, Romano says, has been nothing but positive, and she believes it’s a win-win for both the airline and the DAC. “We were able to work with Rick and his team and our airport affairs team, so instead of rebuilding our facility we entered into an agreement to use a beautiful facility already up there,” Romano says. “They’re just willing to do and work with us for whatever we need.” Right now, the primary needs are modifications to accommodate TSA and some “small little tweaks in terms of passenger flow and baggage retrieval” to improve efficiency and make the passenger experience more comfortable, Cudney says.
The Future of DAC The DAC has expanded its footprint since 2012 and now sits on forty-one acres, Fox says. Nineteen of those are classified as non-aviation, which allows the land to be used for ground storage, as a laydown yard, or (as happened several years ago) a place for luxury car company Audi to test its vehicles’ coldweather performance. The potential exists to build out the adjacent aviation lot and add another large hangar or to add additional gravel to the non-aviation portion of the lease, Fox says, but for the moment there are no plans to expand. “We’re at the point right now where we would rather listen to our clients, so we’re paying attention to what they might need next,” he says. In the meantime, Fox says the DAC will continue to meet the needs of its clients and provide the service they’ve come to expect. “The goal is to be a one-stop-shop for aviation support,” he says. “Our clients expect good service and we give it to them.”
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Raise-up Crew Raising up the pipeline onto Vertical Support Members (VSMs)
VSM Setting Crew Setting a 32’ Deep VSM
The Bead Shack
Two Bead Hands “Welders” install the first two welding passes, then a tractor moves the shack 80’ to the next weld so pipefitters can fit the pipe up and then receive the shack
Once the height and skew are set, the welder welds supports to the ground and the VSM hole is poured with slurry
Firing Line Shacks
5-Shacks with two firing line welders and helpers in each shack, the firing line welders fill and cap the welds When running 5- Firing Line Shacks the rear shack will be carried by the tractor to the front and they will leap frog to the end of the line, the line is then raised up by the “Raise-up Crew”
The Bead Shack welds in the “Bead” the 1st weld that joins the pipe, the 2nd weld is the “Hot Pass” which will burn out any impurities
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TELECOM & TECH
The Future of 5G for Alaska The Last Frontier at the forefront of technology By Tracy Barbour
Y
ou may be wondering: When is 5G coming to Alaska and how will it change my connectivity— and life? Well, the wait is winding down. The foundation of 5G is being laid, and Alaskans will soon be able to experience the benefits of this advanced technology, according to the state’s providers. Last summer GCI partnered with multinational networking and telecom company Ericsson to build the nation’s northernmost 5G network in Anchorage. GCI is merging its metro fiber network and radio spectrum holdings with Ericsson’s technology to deliver Alaska’s first standards-based 5G new radio (NR) experience. More specifically, GCI is deploying Ericsson’s 3rd Generation Partnership Project 12 | January 2020
standards-based 5G NR hardware and software to about eighty macro cell sites across Anchorage, according to a June news release. These sites will be supported by backhaul services provided by GCI’s metro fiber network. The project will be complete in 2020, with initial 5G service coming online during the first half of the year. 5G NR is the global standard for a unified 5G wireless air interface. 5G NR will deliver a substantially faster and more responsive mobile broadband experience as well as enable new wireless capabilities and applications. The combination of GCI’s assets and Ericsson’s 5G NR solution will increase its Anchorage wireless network capacity by ten times or more and
provide better coverage. Over the next few years, GCI intends to launch two different 5G modes: non-standalone 5G and standalone 5G, according to Josh Lonn, GCI’s vice president of wireless products. He explains: “Non-standalone 5G relies on an existing LTE network for certain functions, combined with 5G NR. Pretty much everyone will be launching 5G in non-standalone mode, since it allows us to use many of the LTE assets that support our LTE network today. Over time, we'll see standalone 5G, where all services will be delivered over 5G. When standalone materializes, we'll start to see additional benefits like true network slicing and ultra-low latency. That's not to say 5G-NR non-standalone isn't worth
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the effort. LTE is a critical ingredient in the path to 5G.” As GCI modernizes its network, starting with urban markets, it’s deploying more radio spectrum than ever before, Lonn says. And 5G is an important ingredient in this modernization story. “We really can’t wait to make Alaska the first frontier for 5G,” says Lonn. GCI is constantly evolving its network, and device manufacturers are always adding functionality, Lonn says. 5G will enable consumers using newer LTE devices to experience significant service improvements— even without using a 5G phone. “The advanced LTE features are just below 5G,” he says. GCI is in the process of working with Ericsson and turning up additional cell sites. So GCI customers are already encountering some improvements. “Our customers are seeing a better LTE experience than they did even six months ago,” he says. GCI controls 210 MHz (megahertz) of mobile radio spectrum in Anchorage, more than any other wireless provider, including low-band 600 MHz, 700 MHz, and 850 MHz
GCI wireless buildout. GCI
spectrum, which is particularly useful for indoor coverage, and mid-band PCS and AWS spectrum. The company’s 5G NR deployment will take advantage of all five of these radio bands to ensure a superior experience for Anchorage residents.
However, not all 5G is alike. For example, one end of 5G revolves around millimeter-wave service, which delivers blazing-fast speeds but a very small coverage radius. On the other end is lowband spectrum, which can be deployed down to 600 MHz and is especially
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good at in-building coverage—but there is a tradeoff of speed for coverage. In the middle is mid-band spectrum, which delivers better speeds but at a sacrifice to deep in-building coverage. “At the end of the day, the winning combination is a balance between all three of these variants with devices that can adeptly move users from one to the other,” Lonn says.
The Broader Impact of 5G 5G is essentially the fifth generation of cellular network technology. Incidentally, the industry association 3rd Generation Partnership Project generally defines any system using "5G NR" software as "5G." Previous generations of mobile networks addressed consumers predominantly for voice and SMS in 2G, web-browsing in 3G, and higherspeed data and video streaming in 4G, according to Ericsson. “With global mobile data traffic expected to grow eight times by the end of 2024, there is a need for a more efficient technology, higher data rates, and spectrum utilization,” according to Ericsson’s This is 5G report. “New applications such as 4K/8K video streaming, virtual and augmented reality, and emerging industrial use cases will also require higher bandwidth, greater capacity, security, and lower latency. Equipped with these capabilities, 5G will bring new opportunities for people, society, and businesses.” Interestingly, previous generations of mobile technology were defined and designed for consumers. However, 5G is simultaneously being defined for business applications. Thus, the transition from 4G to 5G will directly serve both consumers and multiple industries. Ericsson’s network technology is designed to help providers smoothly evolve from 4G to 5G, with both high cost-efficiency and short time to market. The company began laying the groundwork to facilitate 5G deployment a number of years ago. “What we did then was we accelerated the standardization, so the first 5G was deployed at the end of 2018,” says Peter Linder, head of 5G marketing for Ericsson North America. “Today you have 5G in fifty-one networks in the United States.” He adds: “I think 5G is one of the most exciting areas in telecom." 14 | January 2020
5G in rural America. Ericsson North America
Generational Distinctions So how do the generations of cellular technology differ in their functionality and performance? Lonn describes the distinction this way: “Every iteration of standards in the mobile industry has been associated with a generational number. The first generation was analog mobile phones. When 2G came around this was the first acronym of GSM (Groupe Spéciale Mobile). 3G was about introducing very basic voice, messaging, or limited data service. 4G took on more of a data component. It introduced highspeed data first and then LTE. It took a ten-year span for LTE to get to where it is today. 5G is about transforming that and looking at the true utility of what you can do over mobile.” The difference between 3G and 4G was about speed and bringing broadband experience to mobile, Lonn says. But speed really isn’t the differentiator when it comes to 5G. “It’s about building a platform that combines better speeds, lower latency, and a much better architecture,” he says. Linder agrees. Looking at 5G and thinking it’s just a little faster than 4G is missing the boat, he says. With 5G, the capacity will go up significantly— both upstream and downstream—and networks can be updated annually. “Now we can upgrade the networks every month... That will allow us to support all the industries around us,” he says.
Having more efficient networks will allow industries to be transformed by new capabilities. For instance, 5G will allow a full-length HD movie to download in seconds, quick reaction time to enable remote robotics, and battery lifetimes beyond ten years for remote cellular devices. 5G will also allow businesses to digitalize with more mobility, flexibility, reliability, and security, which will take Internet of Things and industrial applications to unprecedented levels. Linder characterizes 5G in these terms: “It’s like twenty-first-century farm roads that are helping to connect local businesses with the bigger economy. It’s more a digital journey.” 5G technology will make a major difference in how people learn, access information, and apply knowledge in the future. It will mean the difference between reading a printed operator’s manual and using augmented reality glasses to obtain instructions. Or instead of a traditional surveillance camera taking still pictures at low resolution, 5G will enable video to be captured in high resolution in real-time. And artificial intelligence will be able to analyze realtime video and warn businesses about what might go wrong before the event happens. “I think before we see all of these things in play, it will take another three to five years,” Linder says. “But that is the direction this is headed.”
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Exploring the possibilities of 5G. Ericsson North America
5G will shrink the world a lot more than the previous generations of cellular network technology, according to Linder. “I think it’s fair to say 5G is the biggest capability shift ever in mobile networks,” he says. “I think it will be more transformative than the internet.”
Views of Other Telecoms Other telecommunication companies in Alaska also offer a positive outlook on the advent of 5G technology. Matanuska Telephone Association (MTA), for example, has been proactively preparing to leverage the benefits of 5G. “With 5G rolling out in increasingly more areas, there’s widespread agreement that 5G service would have a positive impact to the people of Alaska in terms of speed and ease,” says Jared Lindman, MTA’s director of product management. “That said, it shouldn’t be viewed as an easy—or cheap—cure-all for areas that are currently lacking in connectivity. Properly deploying 5G in Alaska will require heavy capital investments in infrastructure to disperse a signal. In addition to the high cost of deployment, there will be a significant investment of time required to work with the various levels of government necessary to install and then disperse 5G.” For 5G to make a true impact, Lindman says, it will require a robust data 16 | January 2020
network to carry the data away from 5G towers to its destination. Fiber backhaul is what makes that all possible. “Because of that, MTA has been investing in our fiber network both in our service area and with AlCan ONE—the first allterrestrial fiber line from Alaska to the contiguous United States and the rest of the world—which will be a crucial link if 5G is ever to have mass adoption in Alaska,” Lindman says. As a technology leader, MTA is always excited to see developing technologies like 5G evolve and integrate into Alaskans’ lives, Lindman says. “With our advanced network, the construction of AlCan ONE, and commitment to enriching the lives of our member owners, MTA continues to be well-positioned to play an important role in Alaska’s tech future and access to high-speed internet and phone service.” Alaska Communications plays an important role in the fiber networks needed for technologies like 5G. According to Jim Gutcher, senior director of product management and pricing, “5G has the potential to further connect our world, bringing increased bandwidth and reduced latency.” "At Alaska Communications, we build the high-speed fiber networks that enable 5G expansion in Alaska, providing broadband connectivity to the 5G network. As we all become
more connected and new applications emerge with 5G, the need for a highspeed, reliable fiber network only grows. We’re making the investments needed to enable the connected world for consumers and businesses.” Arctic Slope Telephone Association Cooperative (ASTAC) also has a keen interest in capitalizing on 5G for its customers. The member-owned entity is a 4G provider that offers residential and business phone, internet, and long-distance solutions. “ASTAC sees the opportunity to increase network efficiency by 10 to 20 percent and improve the customer experience by deploying 5G,” says Brian DeMarco, director of wireless networks. “As we continue to overlay our 4G network with LTE through 2020, 5G plays a critical part in our technology roadmap.” This year, ASTAC is planning to hold trials to evaluate 5G applications and build use cases that bring value to its members. “Our greatest challenge is finding cost-effective ways to deliver middle mile backhaul in each rural community we serve, preparing our network for a 5G deployment,” DeMarco says. “2021 will mark ASTAC’s fortieth year operating on the North Slope. Our commitment to the people we serve has never been greater and we strive to advance 5G and all other advanced technologies to our membership across the North Slope."
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State's Economists Weigh in on 2020 Outlook Construction, oil & gas, transportation are bright spots; heathcare, retail experience challenges By Isaac Stone Simonelli
T
he cautious optimism with which economists approached Alaska’s 2019 economy turned out to be well-founded, with most experts indicating that the Last Frontier has turned the corner and in 2020 will claw its way out of the recession that followed tumbling oil prices several years ago. However, the recovery is not expected to be uniform, as Anchorage remains in recession and many of the impacts of the state’s budget cuts have yet to play out. 18 | January 2020
Oil & Gas Optimism “The most recent macro-economic indicators show Alaska’s economy has
begun to grow again and add jobs. In the near-term, there is concern over the effect of state government budget cuts,” Northrim Bank EVP, Chief Credit Officer, and Bank Economist Mark Edwards says. “However, there is renewed optimism in the private sector that a number of large-scale natural resource development projects are advancing and new discoveries of oil and gas are increasing investment activity for exploration and development.”
Alaska Business www.akbizmag.com
As of August, the oil and gas industry had grown by 500 jobs (5.3 percent) when compared to the same month in 2018, according to the Alaska Department of Labor and Workforce Development. An additional bolster to the oil and gas industry has been the stability of oil prices. ANS West Coast oil prices averaged between $60 and $72 in 2019 with the State Department of Revenue forecasting an annual average ANS oil price of $68. Projections put the average for FY2020 at $66 per barrel. “On the oil front, there are promising projects and oil prices have stabilized, which should help,” says Mouhcine Guettabi, an associate professor of economics at the Institute of Social and Economic Research. “Oil remains Alaska’s most important economic base and its recovery will surely help the rest of the economy.” However, according to the Anchorage Economic Development Corporation’s 2019 3-Year Outlook Report released in July, employment in oil and gas is unlikely to return to pre-recession levels in the near-term. Nonetheless, the report shows that robust activity on the North Slope is an encouraging sign of optimism among producers. The Alaska Department of Revenue forecasts production on the North Slope, after a decline in FY2019 of 1.3 percent, will rise by 3.5 percent in 2020. The AEDC report also indicates that North Slope oil production is expected to average 530,000 barrels per day in FY2019 before declining to about 491,000 barrels per day by FY2022. “Production is anticipated to rebound to above 500,000 barrels per day in the late-2020s as several key projects come online,” the report states. But job numbers aren’t as strong as dollars invested, AEDC President and CEO Bill Popp warns, noting that production nationwide is up by a third more oil than pre-recession, yet it’s being created with a 20 percent decrease in the workforce. One big question that remains for the oil and gas industry in Alaska is how Hilcorp Energy’s $5.6 billion acquisition of BP’s Alaska assets will play out. “In the short run, the question is how many of the 1,600 BP employees are retained by Hilcorp,” Guettabi says. Popp points out that the handover wasn’t a surprise, as the Last Frontier no www.akbizmag.com
“[Healthcare is] the sector that's pretty reliantly providing new jobs in our economy year in and year out. In fact, there were some years when if healthcare hadn’t grown, the overall economy wouldn't have grown. Healthcare gains in 2019 have slowed considerably, and we're not sure why.” Neal Fried, State Economist
Alaska Business
January 2020 | 19
“The most recent macro-economic indicators show Alaska’s economy has begun to grow again and add jobs. In the near-term, there is concern over the effect of state government budget cuts. However, there is renewed optimism in the private sector that a number of largescale natural resource development projects
longer fits BP’s business model and that their exit is an understandable part of the lifecycle of an oil field. “The big companies come in, they make the major discovery, they do a significant amount of work to develop that discovery as rapidly and fully as they can. Then, it reaches a point where it's no longer economical for that company to do business in that particular field, and they sell it to the next generation, like Hilcorp, a smaller, more nimble company looking for new opportunities,” Popp says. “We're guessing within a year or two we’ll start to see new assessment/ deployment in Prudhoe Bay to produce the barrels of oil from pockets of oil that were just not economical for BP to pursue. So, at the end, we think that there's going to be more money spent and more jobs created at the Prudhoe Bay unit.” Popp is not overly concerned about how a possibly leaner Hilcorp headquarters in Anchorage would impact job numbers in the city. “It's an opportunity for companies outside of the oil patch to acquire very highly skilled employees. BP is not just people working on drill rigs or working in the highest end corporate offices. They have a huge number of clerical staff, accounting staff, legal staff, permitting staff that are very much in short supply in many other companies throughout Anchorage,” Popp says. “I think it's going to be more of an offset than it is going to be a loss.”
are advancing and new discoveries of oil and gas are increasing investment activity for exploration and development.” Mark Edwards, Bank Economist, Northrim
20 | January 2020
Budget Cuts Popp is less optimistic about the fate of Anchorage as a whole, predicting that the severity of Governor Mike Dunleavy’s vetoes on the capital budget chilled any chances the city had in joining the rest of the state in shaking off the recession. “Unfortunately, due to the budget issues, impacts of the governor's vetoes,
we are seeing an extension of the recession, at least as far as Anchorage is concerned,” Popp says, noting that Anchorage is about half of the state’s economy by GDP, making up about $25 billion of Alaska’s $54 billion. The city also hosts about 42 percent to 43 percent of jobs in the state. One of Popp’s largest concerns for Anchorage’s economy is the potential effects Dunleavy’s cuts to Medicaid might have on the healthcare sector. “We see a lot of uncertainty in healthcare, which has been previously a fairly significant growth sector. But with the cuts to Medicaid—that is an issue for the healthcare industry,” Popp says. “The governor did pull back on some of his cuts, but not to a degree that we feel that it would have a significant effect at this time on that projection.” The cuts to Medicaid, which Dunleavy set at about $249 million in his initial budget, ended up coming in at $159.9 million. State economist Neal Fried notes that healthcare is the largest private sector employer in Alaska. “It's the sector that's pretty reliantly providing new jobs in our economy year in and year out. In fact, there were some years when if healthcare hadn’t grown, the overall economy wouldn't have grown,” Fried says. “Healthcare gains in 2019 have slowed considerably, and we're not sure why. If that continues in 2020, that's going to be something that might be absent that normally isn't; they're usually pretty good at providing an additional boost to the overall employment numbers.” Other cuts that Popp cites as having a negative impact on the economy were to the University of Alaska system, state employees, and support for services performed in Anchorage by third-party agencies or nonprofits. “It’s all kind of cumulative,” Popp says. “It’s not a deep return to recession. It’s just this small but lingering level of job loss in Anchorage that we feel will be felt again next year because many of the cuts will not manifest themselves at the university until next year, as an example. It takes a while for the cuts to filter down to the on-the-street level jobs.” Popp wasn’t the only economist to weigh in the budget cuts when balancing what factors will impact the 2020 economy.
Alaska Business www.akbizmag.com
“The uncertainty is probably most pronounced for the healthcare sector due to the Medicaid cuts as it is unclear how/if they will be implemented and the seafood industry due to the trade tariffs. State government employment has been declining for a number of years and is currently at 2002 levels,” Guettabi says. “Local government employment held up well during the recession but is likely to be affected as communities start making budgetary adjustments. The final budget was agreed upon in June which means it is unclear how much of the cuts have been implemented and whether they have made their way into the economy.” If Alaska attempts to continue providing its current level of services and dividends using the historical formula, conservative estimates put it at a $1 billion deficit, according to Guettabi. “This means either another round of cuts, a tax, a reduction in services, or a lower dividend. Without resolution, households and businesses will have difficulty making long-term decisions,” Guettabi says. “On the positive front, I expect both oil and gas and construction to continue their recovery.”
ARE YOU READY? Uptick in Construction and Transportation In Anchorage, pent up demand for construction projects, as well as recovery efforts following the November 2018 earthquake, have led to relatively strong growth in the sector. “I think construction's got some opportunities for continued stability in the coming year with continued earthquake recovery work related to government facilities, like schools, that need to be repaired,” Popp says, noting that there was an uptick in commercial building projects, as well. “We've had a lot of years without anything going on. There is a pent-up demand for replacement buildings, expansion, remodels, things along those lines that will probably help those numbers.” In August of 2019, construction led growth in the state with 600 www.akbizmag.com
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“We're guessing within a year or two we’ll start to see new assessment/ deployment in Prudhoe Bay to produce the barrels of oil from pockets of oil that were just not economical for BP to pursue. So, at the end, we think that there's going to be more money spent and more jobs created at the Prudhoe Bay unit
additional jobs compared to August of 2018, an improvement of 3.2 percent, according to Edwards, who referenced Department of Labor and Workforce statistics. “The oil and gas sector, as well as the construction sector, have been the drivers of the economic rebound. Between January and August 2019, construction employment is averaging 725 more jobs than during the same period in 2018,” Guettabi says. “Oil and gas employment is averaging 500 more jobs than during the same period last year. The growth has started spreading to the rest of the economy.” Two other bright spots for the state, and Anchorage, are the tourism sector and the transportation sector. “Airport numbers continue to remain really strong, and we continue to see some fairly significant positive trends in terms of tonnage and numbers of flights,” Popp says. “Really good passenger numbers are expected next year.” AEDC expects 2019 air passenger volume of 5.73 million, exceeding the 2018 record by 1.5 percent. “Strong visitor industry activity in the state will support passenger volume growth of about 1.5 percent annually through 2022,” the AEDC report states. Air cargo is expected to grow between 2019 and 2022 at about 1 percent annually, as long as there are no further escalations in trade disagreements or a national recession, according to the report.
[with Hilcorp].” Bill Popp, President/CEO, AEDC
Retail Stalls While those sectors show promise, retail has continued to follow the downward national trend, impacting Anchorage more than most communities in the state. In 2019, Nordstrom shuttered its operation in Alaska, an example of a national chain dealing with national issues, according 22 | January 2020
to Popp. “We’re starting to feel some of the effects of online shopping trends versus brick-and-mortar stores. Trends in Alaska are not to the level they’re feeling it in the Lower 48, but it is still starting to manifest itself here,” Popp says. “So that's not necessarily a function of the state government cuts, at least not so far. We knew that those were coming, and we knew that those would continue to linger.” Fried agrees the sustained downward trend in retail isn’t entirely tied to the recession, as ecommerce is putting pressure on department stores, bookstores, and similar businesses, though grocery stores have mostly not been impacted by the trend. “It's tied to the way we're doing business differently. I mean, even in a booming national economy right now, retail is down,” Fried says.
The 2020 Mixed Bag Despite some of the positive indicators, especially those seen in the oil and gas industry, enthusiasm about the state turning the economy around and crawling further out of the recession in 2020 are hampered by the uncertainties created by state budget cuts. “Significant cuts to the state budget, as they stand now, essentially eliminate any chance of economic recovery and in fact promise to keep the local economy in recession for two to three more years,” the AEDC report states with regard to the situation in Anchorage. “As we look ahead, while the news is not all bad, sources of renewal in the economy cannot compensate for the damage being done by Alaska’s ongoing policyinduced recession.” Though large military installments, such as those at Eielson Airforce Base, as well as optimism in the oil and gas sector can help offset the statewide impact of the continued recession in Anchorage, it won’t be enough. “Long term planning in the face of uncertainty is very difficult and, until the state’s fiscal situation is resolved, it will continue to be difficult for households and businesses to make spending and investing decisions,” Guettabi says, echoing the AEDC report.
Alaska Business www.akbizmag.com
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CONSTRUCTION
State and Federal Funding Contribute to 2020 Construction Routine maintenance of public buildings continues to be deferred By Vanessa Orr
I
t was a long and hard-fought battle, but when Alaska’s state budget for FY2020 was finally approved this past August, things weren’t quite as grim as they at first seemed. Still, there were some major cuts—the budget for FY2020, which began on July 1, 2019, was $390 million below the previous year’s approved funding, with spending on capital projects down from $168 million in FY2019 to $144.3 million in FY2020. The good news is that the majority of construction projects that take place in the 49th State are financed by federal funds; the bad news is that the state’s general fund, which is used to provide matching money to move these projects forward, has been reduced. The general fund is Alaska's major source of discretionary funding and can be used to pay for government operations, basic services, and capital improvements. While most Alaska Department of Transportation and Public Facilities (DOT&PF) projects are federally funded, the state is still required to provide matching funds of around 9 to 10 percent. Money for the routine maintenance of public buildings has also been decreased, which could have a lasting effect on properties far beyond this budget year. According to Ben White, director of program development for DOT&PF, the majority of DOT&PF’s infrastructure projects that are currently in progress are federally funded. “There are only a couple of General Obligation [GO] Bondfunded projects remaining, and most of these required some supplemental federal funding,” he explains. “There are a couple of state-funded projects currently under development; however, this is a very small proportion of the overall project workload for the department.” According to White, DOT&PF anticipates moving approximately $482 million worth of highway projects into construction in federal FY2020.
24 | January 2020
Seward Highway MP 75-90 Road and Bridge Rehabilitation project, April 2019. © Ted Meyer | Alaska DOT&PF
Alaska Business www.akbizmag.com
“The state has more infrastructure needs than funding that is available, which means that we need to prioritize the infrastructure needs and find measures to reduce the overall project costs,” says White, adding that DOT&PF is actively working to expedite project delivery as one method to reduce project costs. “Since the majority of DOT&PF projects are federally funded, there are federal requirements regarding delays and cancellations that could pertain,” explains White, adding that projects can be delayed for numerous reasons. “Projects have a set amount of time to advance to construction, and there are requirements for the state to reimburse federal funding on a project should it be cancelled [without sufficient cause] once started.” Because there is less state funding available, this has created a larger reliance on limited federal funding. “DOT&PF works to balance the infrastructure needs of the state with the available funding, so this may mean that we see a reduction in new projects started over time,” White explains.
Upcoming Construction In early 2020, DOT&PF will award $50 million in transportation grant funding for the Community Transportation Program (CTP), which allows communities to submit project scope and estimate for funding. The last CTP project nomination opportunity occurred in 2011. DOT&PF is currently reviewing and scoring submissions and expects to make the awards in early 2020. There are several larger projects already underway throughout the state, as well as some that will break ground in 2020. In DOT&PF’s Northern Region, these include: Chena Hot Springs Road Roundabouts: By constructing two roundabouts at the interchange, this project will result in increased safety on Chena Hot Springs Road where it meets the Steese Highway. The goal is to reduce the higher-than-average crash rate at the intersection, fix poor sight distance issues, and slow drivers as they navigate between these two high-speed roads.
Charlie Bohart, PE, stands in the sunset glow next to Pacific Asphalt’s striping truck and personnel. © Janelle Whiteley | Alaska DOT&PF
This project is expected to be constructed in 2020 at a cost of approximately $5 million. It will be 100 percent federally funded through the Highway Safety Improvement Program. Wendell Avenue Bridge Replacement: This project will replace Wendell Avenue Bridge, which is located over the Chena River in downtown Fairbanks. The new bridge will have improved pedestrian and bicycle facilities that will improve pedestrian access along the Chena River in the downtown corridor. “This project was started in 2009 with
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money from GO Bonds, but was paused briefly during the Walker Administration amid deep state budget cuts,” says White, adding that the bridge, which was built in 1953, needed such extensive structural repairs that replacing it cost about the same as repairing it. Construction is expected to start this year and last for two seasons. The cost is approximately $18 million, which is 100 percent state-funded through GO Bonds. In the Southcoast Region, projects include: Haines Highway Reconstruction Milepost 12.2-23: This project will realign and widen the Haines Highway between Mileposts 12 and 23. Curves will be straightened to meet a 55 mile per hour design speed, and a long-term solution to debris flow problems near mileposts 19 and 23 is included in the work. Enhancements are planned along the Chilkat River. This project is federally funded, and the engineer's estimate is $50 million to $60 million. Ketchikan Gravina Island Access Improvements: This project will improve access between Gravina Island and Revillagigedo Islands and involves the construction of a new ferry terminal on both the Revillagigedo and Gravina sides of the airport ferry route. It also includes reconstruction of the existing ferry terminals on both sides of the route. “This project will expand and improve ferry terminal uplands and parking at the Revillagigedo Island ferry terminal and include a new passenger waiting shelter and roadway improvements to adjacent Tongass Avenue,” says White, adding that the federally funded project is estimated to cost $40 million to $50 million. Central Region projects include: Seward Highway, O’Malley Road to Dimond Boulevard: This is the third in a series of projects to improve capacity, safety, access, and connectivity on Seward Highway between Rabbit Creek Road and 36th Avenue. The current design includes the following proposed elements: • Expansion of Seward Highway from two to three through-lanes in each direction • Diverging diamond interchanges at O’Malley Road and Dimond Boulevard • A grade-separated undercrossing at 26 | January 2020
Glacier Creek Bridge Girder Placement, 2019. © Ted Meyer | Alaska DOT&PF
Scooter Avenue/Academy Drive • Improved and new pedestrian and bicycle facilities These enhancements are expected to improve safety throughout the project corridor; improve connections between both sides of the highway and improve access to the Dimond Center retail district for both pedestrians and vehicles; add new bike and pedestrian routes and enhance existing connections throughout the project corridor; and increase capacity at the O’Malley Road and Dimond Boulevard interchanges. Construction is expected to begin in 2022, with an estimated project cost of $80 million to $100 million. Knik-Goose Bay Road: Construction of this project is being split into two phases combined with the adjacent Knik-Goose Bay: Vine Road to Settler’s Bay Drive project. This phasing plan will provide the greatest benefit to the most users; improve the highest volume segment first; and expedite project delivery. Phase I, which includes the construction of the Centaur Avenue to Fairview Loop Road segment, is expected to start in late 2021; construction on the Fairview Loop Road to Settler's Bay Drive segment (Phase II) is expected to begin in 2023. The project will expand the corridor to a four-lane divided roadway from Centaur Avenue to Vine Road with a separated multiuse pathway on the north side and 4-foot inside shoulders and 8-foot outside shoulders. In order to improve safety and reduce congestion, breaks in the median have been proposed for every half-mile to mile. Transition areas will expand the road north of Centaur Avenue and south of Vine Road in order to match the existing roadway. According to White, the purpose of this project is to improve mobility for people and freight and to enhance access management along Knik-Goose
Bay Road. “It will add capacity and correct problems created by unconstrained access, thereby improving safety and reducing congestion for roadway users,” he says, adding that the roadway will be designed to accommodate both current needs and future capacity improvements. The project is estimated to cost $100 million to $120 million.
Routine Maintenance Delayed While these projects are underway, it is likely that the routine maintenance of public buildings, which is completely state-funded, will not fare as well. According to the state’s Office of Management and Budget, the state already has a backlog of $2 billion in deferred maintenance, which is growing by $150 million to $400 million annually. The University of Alaska, which is the largest landlord in state government, may be especially hard hit as it owns and maintains more than 420 buildings, totaling 8.2 million gross square feet, with an adjusted value of nearly $4 billion. According to the university’s Office of Government Relations, universityowned facilities are some of the oldest buildings in the state with an average age of thirty-three years and a facilities maintenance backlog approaching $1.1 billion. The university currently uses internal operating funds to partially mitigate the risks of delayed facilities maintenance, spending approximately $35 million annually, compared to the $60 million it estimates it requires. While the university has historically looked to the legislature to provide annual capital funding for building upkeep, as a result of the new state budget, the University of Alaska will see a $25 million cut in funding for this budget year, which began July 1. The next two years will see cuts of $25 million and $20 million, for a total of $70 million.
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& keeping Hiring the Right Employees New employment trends mean more, unique benefits By Tracy Barbour 28 | January 2020
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mid historically low unemployment rates, companies nationwide are struggling to attract and retain qualified employees. And the problem seems to be exacerbated in Alaska by a population smaller than many cities and a declining pool of viable workers. Consequently, Alaska companies must be even more resourceful in their efforts to acquire and keep employees who are qualified—and a good fit for their business. Aside from offering a competitive salary and benefits as key inducements, employers can also use less obvious lures to appeal to workers’ broader desires—flexibility, professional development, bonuses, and other enticements can all help set a business apart. While incentives can’t resolve labor shortages, they can make employers more competitive in the current job seekers’ market.
Alaska’s Dwindling Labor Force The difficulty with finding and retaining suitable talent in Alaska is being fueled, in part, by the state’s shrinking labor pool. Alaska’s labor force peaked in November Alaska Business www.akbizmag.com
2011 at 366,844 people, which was the number of Alaskans age sixteen or older who were employed or looking for a job, according to the Alaska Department of Workforce and Labor’s October 2019 Alaska Economic Trends: How Government in Alaska Compares. As of July 2019, the labor force shrunk to 351,410, meaning more than 15,400 people have dropped out of Alaska’s labor force since November 2011. “At the same time, the unemployment rate decreased by more than a full percentage point, from 7.5 percent to 6.3 percent,” the October 2019 Economic Trends states. “Given the decrease in the size of the labor force, this suggests people who lost their jobs have been more likely to simply leave the labor force altogether than to look for new jobs in Alaska.” Some of Alaska’s diminishing labor force can be attributed to age-related decreases. Baby boomers are retiring faster than younger people are entering the labor force to replace them. More specifically, Alaska has fewer sixteento-nineteen-year-olds, and they are less likely to participate in the labor force. The state also has fewer middleaged workers between ages forty-five and fifty-four, and their participation in the workforce has also declined. It’s not clear why younger age groups are working less. But one thing is apparent: the limited talent pool is making it challenging for many companies in Alaska to maintain adequate staffing levels.
“The lower [companies] want to put the wage, the lower number of applicants they will receive and the lower their skills sets will be. If they want a really top-notch, skilled person, they had better be willing to pay.” Todd Saunders, President/CEO, AKHIRE
The Hardest (and Easiest) Jobs to Fill Generally, the more specialization and expertise required for a position the more difficult it is to fill. There are two types of employees AKHIRE is always seeking for its clients: professional and skilled labor, including engineers, accountants, doctors, and attorneys, according to Todd Saunders, president and CEO of AKHIRE, a statewide, fullservice staffing agency with locations in Juneau and Anchorage. It’s extremely challenging for companies to find good accountants and bookkeepers. The accounting and bookkeeping field has taken a hit over the years, due to a declining interest in STEM (science, technology, engineering, and math) industries. Plus, there is www.akbizmag.com
Alaska Business
January 2020 | 29
2017 Workplace Demographics
TRADITIONALISTS
BABY BOOMERS
GEN X
MILLENNIALS
GEN Z
(Born before 1946)
(Born 1946-1964)
(Born 1965-1980)
(Born 1981-1996)
(Born 1997-present)
27%
35%
37%
1-2%
of the workforce
of the workforce
of the workforce
of the workforce SHRM
0-1% of the workforce
normally high demand for professionals in these disciplines. “Every industry needs a bookkeeper and accountant,” Saunders says. There are many employers in Alaska looking for quality people in the medical field, including physical therapists, doctors, and nurses. “Nursing is hard,” he says. “When recruiting for Bethel and Dillingham, you can go for months without receiving an applicant.” There’s also a huge shortage of certified, bondable, and reliable truck drivers throughout the state. As a result, many of these positions go unfilled. “It’s not that people aren’t interested in the job,” Saunders says. “A lot of them are in the Lower 48 and don’t have the ability [financially] to move themselves up to Alaska. Plus, there are fewer people getting into the profession.” The higher the skill and education required for a position, the more often AKHIRE recruits from Outside. This often requires relocating physicians, nurses, and accountants, as well as truck drivers and people who work in the mining and fishing industries. On the flip side, some easier industries to recruit for are entry-level positions or those that require less specialized skills, such as retail and administration. However, hiring qualified applicants for positions in these fields can be tricky because they tend to pay less. Saunders says: “It’s not an industry-wide thing. They’re all hard to fill… I don’t know of an industry in Alaska that is easy to hire for.” 30 | January 2020
Common Ways to Appeal to Employees Companies can use a variety of tactics and enticements to tempt qualified employees. Salary and benefits are primary incentives. Highlevel professional employees are concerned about benefits packages, says Saunders, who recruits for all industries from medical and mining to food and tourism. But the question of benefits seldom comes up with the average worker in Alaska. “If employers do offer benefits, it’s healthcare, retirement, and paid time off,” he says. “It’s a more traditional benefits package that people are looking for.”
“I don’t know of an industry in Alaska that is easy to hire for.” Todd Saunders, President/CEO, AKHIRE
Some industries are putting a more creative spin on compensation. In tourism, for example, sometimes workers are offered an extra financial incentive for staying on the job. “In tourism, it’s complete the season, and we’ll give you a bonus,” Saunders says. “A lot of smart employers are doing that.” Most employees focus on salary
and the standard benefits, says Katie Lauwers, a consultant with BMG and Alaska Executive Search (AES). But research shows that apart from earning a livable wage, people look for opportunities to develop a healthy work atmosphere that appeals to the core values that are present in the work they do every day. “That’s one way companies can differentiate themselves from competitors,” she says. This is especially true for millennials, who represent almost 30 percent of the workforce. “All of these incentives communicate respect for employees and facilitate trust as well,” Lauwers says. Beyond this, continuing education and development are important because they signify an investment by an employer. They have also proven to retain employees and keep them motivated and engaged for a long time, Lauwers says. “Having an engaged team can reduce safety incidents, increase productivity, decrease absenteeism, and subsequently increase profitability,” she says. When there are more positions than people available to fill them, job candidates have more leverage and freedom to choose employers. So, what can give one prospective employer an edge over another when trying to acquire and keep qualified employees? Apart from financial compensation, the tipping point is flexibility, development, and a good corporate culture, Lauwers says. “We know that if more than half of
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the workforce were offered a job with better culture and development, they would leave their current position… You can attract world-class talent when you have a clearly developed culture.” Companies should focus on fostering positive reviews and feedback on Google and websites like Glass Door, which allows current and former employees to leave anonymous reviews. Employee feedback carries considerable weight with job applicants. “They are shopping for a good fit for themselves,” Lauwers says. “Quality applicants seek out employers who transparently communicate and act out their culture, values, and purpose.” Saunders says that paying for relocation and housing assistance would be the tipping point in cases in which a company is willing to hire from the Lower 48. While hiring locals may be preferable, some companies are willing to pay thousands of dollars in relocation and housing costs to find the right employee. This is especially true with the recruitment of higher-level professionals, who are in strong demand. Beyond money, relocation and housing assistance, healthcare, retirement, and paid time off, name recognition is a big deal in Alaska, Saunders says. Therefore, longevity and credibility within the community can be the deciding factor between two companies that are equally appealing in terms of their financial compensation and work environment. “If it’s a new company or a smaller company, employees are a little more leery and maybe want to go with someone who’s been around a little longer,” he says.
“We know that if more than half of the workforce were offered a job with better culture and development, they would leave their current position… You can attract world-class talent when you have a clearly developed culture.” Katie Lauwers, BMG
Beefing up Benefits So, what do employees say attracts them to a company? Eighty percent of it is money and 20 percent is all the rest, according to Saunders. Employers should keep in mind that they get what they pay for. “The lower they want to put the wage, the lower number of applicants they will receive and the lower their skills sets will be,” Saunders explains. “If they want a really topnotch, skilled person, they had better be willing to pay.” They should also be willing to beef up their benefits package, which is a practice more employers are engaging in according to research www.akbizmag.com
Alaska Business
January 2020 | 31
“Having an engaged team can reduce safety incidents, increase productivity, decrease absenteeism, and subsequently increase profitability.”
Alaska Executive Search is a full-service staffing agency.
Katie Lauwers, BMG
by the Society for Human Resource Management (SHRM). The tight talent market is causing organizations nationwide to try to differentiate themselves through employee programs and services, based on SHRM’s 2018 Employee Benefits Survey. In fact, of the 34 percent of organizations that increased benefits offerings in the twelve months prior to the survey, 72 percent cited retention as a reason for doing so. And more than 50 percent of the respondents said they enhanced benefits to attract new talent (58 percent) and/or respond to employee feedback (54 percent). And in its 2019 Employee Benefits Survey, SHRM assessed the prevalence of more than 250 benefits in key categories such as health, wellness, leave, flexibility, career, and retirement. Employers reported they were more likely to increase offerings in all benefits categories than to decrease offerings. Health-related benefits and wellness benefits saw the greatest increases across employers surveyed, with 20 percent of employers indicating they increased perks in those areas. SHRM also noted that leave benefits showed modest increases in 2019. “Fifteen percent of organizations report increasing leave benefits in the previous twelve months,” the survey found. “Flexible working benefits have also increased moderately, with telecommuting and flexible scheduling both trending slightly upwards.” Professional development benefits 32 | January 2020
Alaska Executive Search
are another category where the current talent market could influence organizations to make bigger changes.
Employing a Staffing Agency The paucity of qualified and wellsuited workers is leading more companies to rely on staffing agencies. In particular, temporary hiring can be a good way for companies to not only find employees but also keep them. Hiring the wrong job candidate can be costly and going the temporary route can allow companies to “try out” employees before making a hiring commitment. Lauwers says: “When companies choose temporary hire, they can maintain the productivity they need, shorten the position vacancy, and streamline the onboarding with support from the staffing consultants. As soon as they find the employee that fits, it’s a pretty seamless process to get them on the payroll.” Temporary hiring can be especially beneficial when a business needs to make seasonal adjustments around holidays and during the summer, for example. This can be ideal if companies don’t need a full-time hire for the whole year or want to prevent their full-time employees from experiencing burnout due to an increased workload. “Temp-tohire allows flexibility to keep the team productive and lessen the load on great employees,” Lauwers says. “And you can provide ample time to find a fit that works while staying productive.”
For workers, temporary jobs are often appealing for their flexibility and employment stability, says Lauwers, who started at AES as a temp. Temporary work can allow workers to build their resume with a variety of experience while having AES as their employer of record. “When temporary employees look for a permanent job, their resume tells a story that they had a stable employer and a variety of experience,” she says. She adds: “Historically, temporary employees were viewed as inconsistent and looking for a quick check. We have found that temporary employees reflect various age demographics while they have a variety of experiences, knowledge, and are interested in learning more.” Employing a staffing agency to find qualified employees can be a good investment for companies, given the current job market and online recruiting environment. The shift to online recruiting means job candidates can apply for multiple jobs with the push of a button. And a low unemployment rate empowers high-demand applicants to “ghost” prospective employers by simply not showing up for interviews. “I think part of what’s attracting employers to use a staffing agency is the ghosting,” Saunders says. “It’s become much more complex to find good people in a market where the unemployment rate is as low as it is. Employees have become more nonchalant about looking for jobs.”
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ALASKA EXECUTIVE SEARCH STAFFING AND RECRUITMENT
90%
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JUNIOR ACHIEVEMENT SPECIAL SECTION
Celebrating 33 Years of Junior Achievement JA inducts 2020 Alaska Business Hall of Fame Laureates
J Junior Achievement
oin Junior Achievement for the 33rd annual Alaska Business Hall of Fame, an event that celebrates the past, present, and future of business in Alaska. In 1987, Junior Achievement (JA) began the Alaska Business Hall of Fame to honor outstanding individual leaders of Alaska business. Since then the Alaska Business Hall of Fame has become one of the state’s most prestigious events, inducting new laureates on an annual basis. These individuals are honored for their direct impact toward furthering the success of Alaska businesses, support for JA’s
mission and programs, and commitment to contributing to the Alaska economy. This important event is also a time to help raise funds for JA, which is dedicated to providing economic and entrepreneurial education. Since 1973, JA has served K-12 students statewide from Utqiaġvik to Ketchikan. JA serves more than 15,500 students annually in fifty-five Alaska communities. Demand for JA’s partnerships between the business community and educators continues to grow with the end result being young people who are
Celebrate the 2020
Alaska Business Hall of Fame Laureates Dena’ina Civic & Convention Center Thursday, January 23, 2020 5:30 p.m. Reception Dinner/Ceremony 6:30 p.m.
2020 Honorees
Help kids learn personal finance basics and empower their future
Van Hale & Jack Amon, Marx Bros. Cafe Dave Lawer, FNBA April & Pat Reilly, Rain Proof Roofing Aaron Schutt, Doyon Limited
Junior Achievement’s purpose is to inspire and prepare young people to succeed in a global economy. If you would like to volunteer, request a program, or volunteer with JA, please reach out to the JA near you!
AlaskaBusiness
Learn more at alaska.ja.org
Call Flora Teo at 907-344-0101 to reserve a table or go to alaska.ja.org for more information
34 | January 2020
Alaska Business www.akbizmag.com
2020 at the Dena’ina Civic & Convention Center. Doors open at 5:30 for a no-host reception with the dinner and awards ceremony beginning at 6:30 p.m. For table reservations, or to inquire about (the limited) remaining sponsorship opportunities, we encourage you to call JA at 907-344-0101 or visit alaska.ja.org. From the board, staff, and students of Junior Achievement of Alaska, we wish you the very best in 2020 and we look forward to seeing you on January 23!
Statewide Board of Directors 2019-2020 Jed Ballard, Member, Northrim Beth Barnes, Vice Chair, Alaska Communications Robert Craig, Member, Alaska Heart Institute Ryan Cropper, Member, Able Body Shop Travis Frisk, Member, Wells Fargo Travis Gularte, Member, 907Financial Diana Helmbrect, Member Mark John, Member, Petro Star Krag Johnsen, Member, GCI Kristen Lewis, Secretary, Laura Walsh & Associates
Ligia Lutan, Member, First National Bank Alaska Jenna Maurer, Treasurer, Anchorage Sand & Gravel Kurt Martens, Member, Leonard & Martens Investments Mary Miner, Member, Alaska Growth Capital Julie Odegard, Member, Alyeska Pipeline Service Co. Andy Pennington, Member, Anchorage Daily News Bryan Powell, Member, KeyBank Peter Ramgren, Member, Superior Court Master Tom Redmond, Member, Windtalker Innovations Erin Sage, Member, ExxonMobil Matthew Widmer, Member, Birch Horton Bittner & Cherot Emma Zeisel, Member, Alaska National Ins. Co.
John Sims, Member, Enstar Natural Gas Co. Jana Smith, Member, Parker Smith & Feek Mark Smith, Member, Retired USAF Beth Stuart, Member, KPMG Greg Stubbs, Member Shaun Tygart, Member, Tanadgusix Corp. Kevin Van Nortwick, Chair, BDO USA Derrell Webb, Member, NANA Management Services Seth Weingarten, Wells Fargo Advisors
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January 2020 | 35
JUNIOR ACHIEVEMENT SPECIAL SECTION
of Rain Proof Roofing; and Dave Lawer, who retired as senior vice president and general counsel from First National Bank Alaska. Congratulations to you all! The Alaska Business Hall of Fame is attended by 600 business community leaders, many past JA laureates, Alaska’s government officials, and other JA supporters. We are again pleased to have General Mark Hamilton emcee the event along with our very own JA students. The Alaska Business Hall of Fame is being held on Thursday, January 23,
prepared to enter the workforce and our global economy. Through the ongoing support of corporations and businesses, we can continue to reach more students in Alaska. It is JA's privilege to invite you to attend the 2020 Alaska Business Hall of Fame, presented by Alaska Business. This year we are honored to induct The Marx Bros. Café Partner/Executive Chef Van Hale and Partner/Cellar Master Jack Amon; Aaron Schutt, president and CEO of Doyon; April and Pat Reilly, owners
JUNIOR ACHIEVEMENT SPECIAL SECTION
The Marx Bros. Café
©Kerry Tasker
Decades of quality dining, innovation, and community
36 | January 2020
Alaska Business www.akbizmag.com
www.akbizmag.com
asylum for a long time,” he laughs. Hale and Amon also look for balance for their employees. “There’s an attitude among the younger workforce that it’s not all just about the dollars, it’s about work accommodating their lives and their other values,” Amon explains. “A small group like us can find some of that flexibility, which helps with retention.” Point of fact, Marx Bros. Café is only open for dinner service five days a week. “We tried doing seven days,” Hale says. “The thing is, you have to have two shifts of staff and it gets too
crazy. And the bottom line wasn’t that much better, really.” “It was actually better once we stopped,” Amon adds. The Tuesday through Saturday, fiveday schedule benefits the wait staff and the kitchen staff, the partners have found. Wait staff want to work on busy nights when they get the most tips, which are Fridays and Saturdays. The kitchen crew is hourly and like the reliability of having a weekday and a weekend day off. “Occasionally we’ll get a buyout we’ll have to cater and they’ll work the weekend, and
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JUNIOR ACHIEVEMENT SPECIAL SECTION
J
ack Amon and Richard “Van” Hale opened the doors of the Marx Bros. Café on October 18, 1979; however, the two had already been partners in cuisine for some time, having created the Wednesday Night Gourmet Wine Tasting Society and Volleyball Team Which Now Meets on Sunday, a weekly evening of food and wine. It was actually the end of the weekly event that spurred the name of the restaurant: hours after its final service, Amon and Hale were hauling equipment and furnishings out of their old location and to their now-iconic building on Third Street, all while managing arguments about equipment ownership, a visit from the police, and quite a bit of wine. “If you’ve ever seen the movie ‘A Night at the Opera” starring the Marx Brothers, that’s what it was like,” Hale explains. “It was a big storm here at the beginning,” Amon says, but that storm laid the foundation for a decadeslong partnership. “The strength of our partnership is we’ve both really committed to the same vision of the kind of restaurant we want to have and the kind of experience we want to provide… We’ve been really transparent with each other, and we both know where all the money is. I think that after forty years, we’ve managed to work a few things out,” he laughs. “People ask when I’m going to retire, and I say why?” Hale says. “I’m enjoying life… I want to work—it keeps me going, it keeps me young.” As they have for forty years, Hale and Amon share the workload, with Hale managing front of house and Amon managing back of house restaurant responsibilities. Hale explains the level of trust they have in each other does allow them to have time away from the restaurant. “We’re taking a little more time off than we ever have,” he says. “We’ve got pretty good staff. When Jack takes off to Italy for three weeks, it’s nice because he knows I’m at the restaurant covering, and when I’m gone, I know he’s here.” That said, “We both still like to be here at least some of the evening, and sometimes we split the week,” Amon explains. “The customers still like to see us and know we’re here—plus, I don’t want the inmates running the
JUNIOR ACHIEVEMENT SPECIAL SECTION
“The strength of our partnership is we’ve both really committed to the same vision of the kind of restaurant we want to have and the kind of experience we want provide." Jack Amon
Jack Amon, back of house. Tasha Anderson | Alaska Business
at that point they’re happy about the overtime, but they can still make plans with their family. It makes for a nicer lifestyle,” Amon says. Amon and Hale believe in investing in their employees and are pleased at the success of many workers who have passed through the restaurant and gone on to own their own restaurants or have found prominent positions in kitchens in Alaska and beyond. For example, Patrick Hoogerhyde, coowner of Bridge Seafood, was a sous chef at Marx Bros. Café. “We’ve been really fortunate, and we try to cultivate the staff and make them feel involved,” Amon says. “In the forty years we’ve been doing this, we’ve had some really talented people that have come through here and helped us look good.” Amon has a passion for helping youth interested in the restaurant industry; when he served on the board of the National Restaurant Association, he helped found ProStart, a high school to career culinary arts program. “They were just unveiling that program and I was able to secure $150,000 for seed money
from Senator [Ted] Stevens to kick the thing off.” He continues to volunteer as a judge for the Annual Alaska ProStart Invitational, a culinary and restaurant management competition for high school students. This fits with the advice that Amon would give to any young person interested in a culinary career. “Get a lot more experience than I got,” he says. “We were young and very enthusiastic, but I had no idea about workers’ comp insurance and payroll taxes and liability insurance and insurance audits.” However, Amon did have some experience with bookkeeping, which he learned working for his mother as he grew up, so he did know the importance of administrative work in a business. “I’ve known from early on that those things tell you the story of if you’re going to keep your doors open for another month or not. Prudent management of finances is really important, and it’s something young people need to learn at a young age.” He continues, “We were lucky, and when we [started our business in Alaska] it was the wild and wooly
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enjoying life… I want to work—it keeps me going, it keeps me young.” Van Hale
'70s and this town was hungry for anything different. We were able to creep, squeak this place open for under $50,000.” Amon and Hale attribute their success in part to seeing what Anchorage lacked and figuring out how to supply it. “When we started in the '70s you could hardly get anything,” Amon says. “I used to get up at 4 o’clock in the morning and deal with a produce broker in LA so we could get red bell peppers and baby vegetables and fresh raspberries… Not only did we want to use local foods, but we really wanted to bring exotic things here that people wouldn’t necessarily see and introduce people to new foods from around the world.” “I think we make our own trends,” Hale adds. “We create our own energy and philosophies and imagination.” Marx Bros. Café is an icon in the Anchorage dining scene, which is a result of both their long history of quality and their ongoing drive to innovate and surprise. Hale’s advice to would-be restauranteurs reflects that philosophy: “If somebody says something new, learn that, good or bad. I did a lot of listening growing up, and it’s helped me out.” Hale and Amon value their position as part of the community, and so it’s important to them to be honest and fair. If it says fresh fish on the menu, it is fresh. And they work to set prices for their menu that aren’t expensive just to be expensive. “I don’t believe in jacking up the prices of the wines,” Hale explains. “Too many restaurants do that—mark them up 200 or 300 times—and I just don’t believe in that. I want to give [our diners] a quality product.” “I’ve been doing this since I was in my late twenties… and the community support means a lot,” Amon says. “We’ve had people that might only come once a year for a birthday or anniversary, but they have www.akbizmag.com
come for more than thirty of them. They’ve had their first date here and we’ve catered their wedding. They come every year on their anniversary, and now they’re bringing their kids. I
Alaska Business
Van Hale, front of house. Tasha Anderson | Alaska Business
love that connection to community. We get to celebrate with people and share their moments.”
January 2020 | 39
JUNIOR ACHIEVEMENT SPECIAL SECTION
“People ask when I’m going to retire, and I say why? I’m
JUNIOR ACHIEVEMENT SPECIAL SECTION
Rain Proof Roofing and the Reillys More than half a century of community support
F
or nearly sixty years Rain Proof Roofing has been an integral part of Alaska’s business community. Founded in 1962 by Jack Markley, the company is owned and operated today by Pat and April Reilly (née Markley). The couple, who started dating in high school, are significant contributors to nonprofit organizations throughout their community, says Flora Teo, president of Junior Achievement, noting that the Reilly’s were chosen as 2020 Alaska Business Hall of Fame Laureates “for their significant contributions to the growth of Alaska’s economy and demonstrated commitment to the principals that Junior Achievement teaches young people—financial literacy, workforce readiness, and entrepreneurship.” Rain Proof Roofing’s investment in Alaska starts with creating jobs, employing between 60 and 100 workers depending on the season, and by purchasing roofing supplies locally. It goes a step further through their support of nonprofit organizations including Junior Achievement of Alaska, Boys & Girls Clubs of Anchorage, Habitat for Humanity, YMCA, Bean’s Café, and United Way. The company sponsored Junior Achievement programs for 280 students during the 2019-2020 school year, Teo says. Pat Reilly—who started running the company as its president in 1978—officially took over at Rain Proof Roofing in the early ‘80s after buying out April’s father’s share of the company. The family company has grown steadily over the years from a six-truck operation in the early ‘70s to fifty some trucks today, providing roofing peace of mind to homeowners in communities throughout Anchorage, Wasilla, and the Kenai Peninsula. During the nomination process, Rain Proof Roofing demonstrated unique qualities that helped make the company and its owners stand out. “[The company] provides outstanding service and support to customers all over the state—which is no easy feat in Alaska. With projects from the North Slope to Southeast, from the roof on your home to the Military Mall on Elmendorf Air Force Base, Rain Proof Roofing maintains a standard of excellence across the board,” says Teo. It was also Rain Proof Roofing’s “above-average commitment to the highest quality of service for their customers” that prompted the Reilly’s business peers to nominate them for the Alaska Business Hall of Fame. “This standard garnered national attention and earned Rain Proof Roofing the Centurion Award—a national recognition given by Carlisle SynTec Systems to honor companies that have 100 projects that have earned a perfect ten. Rain Proof Roofing was the first roofing company to ever receive that honor. “Peers also cited Rain Proof Roofing’s long-standing commitment to the community,” Teo says.
40 | January 2020
A Q&A with Junior Achievement: Junior Achievement: What opportunities led to the early success of your business? Pat & April Reilly: In the late ‘70s, early ‘80s, Rain Proof ventured into federal, state, and municipal (which was then borough) work—this changed the dynamic of the company and provided the opportunity to grow the business and the ability to retain employees year-round. JA: Do you believe there is value in educating young people about free enterprise? P&A Reilly: Absolutely; free enterprise is an avenue to work hard to improve one’s financial position in life. It teaches young people to make decisions based on how much effort they are willing to put forth to make that happen. For most who value the concept of free enterprise, it is often hard to understand those who are content to live off of subsidies that are paid for by others. [We] believe that this is an issue that future generations will have to be more involved in. JA: What can schools and parents do to ensure that young people don’t encounter financial pitfalls? P&A Reilly: Very early on in a young person’s life, it is crucial that they understand the crippling effect debt has on a person’s ability to get ahead financially. Debt drastically limits a person’s ability to accumulate wealth and almost always extends the length of one’s working years.
JA: What can we do to prepare young people to succeed in a global economy? P&A Reilly: Help them understand that, with today’s technology and internet capabilities, borders between states and countries are less of a factor than they used to be. Many industries are no longer defined by where a product is made but instead of how soon can the product be delivered to someone’s doorstep. JA: What accomplishments are you most proud of? P&A Reilly: That we’ve raised two sons that we are both proud of. That we have a wonderful and caring daughter-in-law and are very fortunate to have two young adult grandsons that are working and/or going to school and a third who is active in school sports. Business related, we have both been awarded the Associated General Contractors Hard Hat award, which is recognition within our industry, and have also been recognized by Camp Fire and Boys & Girls Club as strong community supporters. JA: What do you want your legacy to be? P&A Reilly: To be loved by family and friends. To be respected by our employees, customers, and business associates. To be known as someone who values and supports the place we call home. And to be remembered as someone who truly values the employees that made Rain Proof the company that it is today.
Alaska Business www.akbizmag.com
DR. DEENA BISHOP Superintendent, Anchorage School District
D
r. Deena Bishop is being honored as the Junior Achievement (JA) of Alaska Educator of the Year for her outstanding support of community partnerships, JA’s experiential programs, and emphasizing career readiness for students. “Dr. Bishop’s hands-on approach to leadership is admirable, and her commitment to delivering the best education to Anchorage students every day is outstanding. Strong, collaborative partnerships between the business community and schools are important for students,” says JA President Flora Teo. In her role as superintendent for both Anchorage and Mat-Su schools, Bishop has attended JA in a Day events for many years, spending time in classrooms and sharing real-world lessons that connect what students
are learning in schools to how they will use that knowledge in the future. Last May Bishop attended JA’s Volunteer Appreciation event where she thanked members of the business community for volunteering their time and investing in Alaska’s students. JA’s programs teach financial literacy, workforce readiness, and entrepreneurship and are provided to teachers and schools at no cost. Nominations for Educator of the Year are made through a statewide nomination process. Candidates must demonstrate aboveaverage commitment to JA and volunteerism and promote the pillars of Junior Achievement: financial literacy, workforce readiness, and entrepreneurship. Thank you, Dr. Bishop!
EDUCATOR OF THE YEAR AWARD PAST RECIPIENTS 2019: Stephanie Frantz, Goldenview Middle School, Anchorage & Dawn Anderson, Goldenview Middle School, Anchorage 2018: Leah Meyring, Hanshew Middle School, Anchorage 2017: Cessilye Williams, Clark Middle School, Anchorage 2016: Pam Orme, Anchorage School District
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2014: Chris Eisert, South High School, Anchorage
2010: Rebecca Himschoot, Keet Gooshi Heen, Sitka
2013: Karen Wallace, Northern Lights ABC School, Anchorage & Marcus Wilson, North Star Elementary School, Anchorage
2009: Jeannett Barleen, Service High School, Anchorage
2012: Valerie Ekberg-Brown, Chugiak High School, Anchorage 2011: Carol Comeau, Anchorage School District, Anchorage
2008: Charice Chambers, King Career Center, Anchorage 2007: Claudia Pierson, Joy Elementary, Fairbanks 2006: Todd Smoldon, East High School, Anchorage 2005: Beth Ondra Rabbit Creek Elementary, Anchorage
Alaska Business
Northern Lights Bingo Alaska Business Alaska National Insurance Company AT&T Bill Odom BP ConocoPhillips Alaska Denali a division of Nuvision Credit Union ExxonMobil First National Bank Alaska GCI John Hughes Foundation Kendall Lexus of Alaska KeyBank Northrim Northwest Arctic Borough School District Odom Corporation Saltchuk Wells Fargo
PL ATINUM DONORS EXCEL Alaska Alaska Commercial Company Anchorage Daily News Bristol Bay Native Corporation Enstar Natural Gas Company Katmailand Kinross KPMG Leonard & Martens Investments Linda Eliason Lynden NANA Management Services Princess Tours Ravn
GOLD DONORS Able Body Shop Adam & Kristen Lewis Alaska Airlines Alaska Commercial Fishing and Agriculture Bank Alaska Cruise Association Alaska Growth Capital Alaska Railroad Alyeska Pipeline Service Company ASRC Energy Services Baird BDO USA January 2020 | 41
JUNIOR ACHIEVEMENT SPECIAL SECTION
Congratulations 2020 Educator of the Year:
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David Lawer:
A Q&A with Junior Achievement: Alaska Business: How did you get your start? David Lawer: I applied for a lot of jobs so that I could afford to go to college.
An Alaskan New Yorker Senior Vice President and General Counsel, First National Bank Alaska, Retired Editor's Note: The following bio was generously provided by First National Bank Alaska.
B
orn and raised in New York City, David Lawer came to Alaska in 1971 to work on a construction crew to help pay his way through college and law school. After graduating from law school, he returned to Alaska and in late 1976 entered private practice law in Anchorage. Over the course of the next seventeen years, Lawer—who specialized in banking and finance—represented more than thirty banks, mortgage companies, and insurance companies with investments in Alaska. In 1993 he left the practice to become senior vice president and general counsel of First National Bank Alaska (FNBA), his principal client for many years. At FNBA, Lawer supervised human resources and the bank’s risk management and insurance programs, as well as central loan processing activities. His duties also included supervision of the bank’s regulatory compliance efforts, its employee benefits program, and legal and legislative affairs. Now retired from banking, Lawer continues to volunteer in support of the community and the Red Cross of Alaska. He telephoned scores of Alaskans during this past summer’s wildfires to thank donors and volunteers for helping make a difference. Nonprofits that he supports share that he has always been an active member, not just contributing financial support but always showing up to serve as a mentor for others on how to truly give back. Lawer is well-known throughout the community for his larger-than-life personality. He is always thoughtful in his choice of words and direct and to the point when providing advice. As an “Alaskan New Yorker,” Lawer continues to be a proud Yankees fan with a great sense of humor. Asked today what his crowning accomplishments are, he shares that he was fortunate to meet a beautiful Alaskan girl and be in the Last Frontier just as the pipeline days were starting. Most importantly, he and his wife raised a successful daughter, also an attorney and active community volunteer, who has made him the grandfather of two wonderful grandchildren.
LAWER’S HISTORY OF COMMUNITY SERVICE American Lung Association of Alaska, Former Director and President Board of Trustees, Alaska Regional Hospital, Former Director American Red Cross of Alaska Advisory Board, Member since 2007 Alaska Support Industry Alliance, Former Director and President Kachemak Bay Shellfish Association, Former Advisor and Director University of Alaska Anchorage, College of Fellows
42 | January 2020
JA: What was your family life and upbringing like? Lawer: We all worked and had different jobs. My father was a great guy; we did everything together. We worked together. We golfed together. We played ball together. Because I got home earlier than everyone else, I was responsible for making dinner. I followed my mother's (who was a very good cook) instructions, and that's how I learned to cook—throughout my life, I have enjoyed cooking for friends and family. JA: What opportunities led to the early success of your business? Lawer: Having a variety of work experiences, a good education, and a law degree. I was fortunate to be in Alaska just as the pipeline was starting. There were opportunities for anyone, not just young lawyers, who were smart and willing to work hard. JA: Do you believe there is value in educating young people about free enterprise? Lawer: Absolutely. It teaches them about profit and loss, the value of hard work, and the reward of contributing to their community.
JA: What can the business community offer to young people? Lawer: Good entry level jobs and training that will lead to career opportunities. JA: Did you have a role model growing up? Lawer: My role model was my Dad. Young people benefit from role models by developing good work ethics, learn honesty and integrity, and the value of contributing to the community. JA: What can we do to prepare young people to succeed in a global economy? Lawer: Support Junior Achievement. It inspires and prepares young people to succeed. JA: What accomplishments are you most proud of? Lawer: Putting myself through college, achieving my law degree, successfully putting my education to work, and raising an outstanding daughter, who has become an accomplished young woman. JA: What do you want your legacy to be? Lawer: “He worked hard, contributed to his community, and was a dependable friend.”
JA: What can schools and parents do to ensure that young people don’t encounter financial pitfalls? Lawer: Encourage them to get a job early in life, to save, and to learn about investments.
Alaska Business www.akbizmag.com
MATT BROWN Marathon Petroleum
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att Brown has been selected as the Junior Achievement (JA) of Alaska Volunteer of the Year for his outstanding support of JA in the Kenai Peninsula Borough School District. “Volunteers like Matt allow JA to reach students that we normally would not be able to serve in Alaska. The dedication that he and his team in Kenai have to promoting K-12 financial literacy, workforce readiness, and entrepreneurship in schools is a priceless investment in our youth and takes many hours of dedication and hard work,” says JA President Flora Teo. In his role as a classroom volunteer, Brown spends hours teaching students about financial literacy, workforce readiness, and entrepreneurship. Brown works at Marathon and, as a volunteer from the business community, shares his knowledge and experience to encourage students to stay in school and follow their own career paths and maximize their potential. Of JA alumni students, one in five grow up to work in
the same industry as their JA classroom volunteer, which speaks to the valuable role of volunteers and the business community in schools. In his role as a member of the Kenai JA Community Committee, Brown works alongside members of the local business community to bring more volunteers in schools. While the committee is small, they do big work, reaching 500 to 700 students each year in elementary and middle school. “It takes a village, and for students in Kenai, JA would not be able to provide quality programming without volunteers like Matt,” says Teo. Nominations for Volunteer of the Year are made through a statewide nomination process. Candidates must demonstrate above-average commitment to JA and promote the pillars of Junior Achievement: financial literacy, workforce readiness, and entrepreneurship. Thank you, Matt Brown!
VOLUNTEER OF THE YEAR AWARD PAST RECIPIENTS 2019: Carol Wren, Bristol Bay Native Corporation, Naknek 2018: Annie Heffele, Matanuska Valley Federal Credit Union, Mat-Su 2016: Janet Johnson, Denali Federal Credit Union, Kenai 2015: Ted Quinn, Capital Office Systems, Juneau
2013: Dana Novak, Nalco, Fairbanks 2012: Luke Fulp, KIBSD, Kodiak 2011: Becky Zembower, NANA Management Services, Anchorage 2010: George Gates, Benefit Brokers, Anchorage & David Lenig, BP, Anchorage
2009: Matt Kolesky, Arbor Capital Management, Anchorage 2008: Mary Olszewski, Wells Fargo, Anchorage 2007: Candace Campbell-Rhodenizer, BP, Anchorage 2006: Tammy Kosa, Northrim, Anchorage 2005: Rick Whitbeck, GCI, Anchorage
2014: Carl Propes, Scan Home, Anchorage
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Alaska Business
SILVER DONORS 3M Company Alaska Communications Alaska Housing Finance Corporation Alaska Regional Hospital Alaska Sales & Service Alaska USA FCU Anchorage Economic Development Corporation Arctic IT ASRC Avis Rent A Car Bob Gillam C.E. "Chuck" Robinson Family Carr Foundation David & Betsy Lawer Doyon Elizabeth Stuart Harry McDonald Jacobs James Udelhoven Janco Commercial Cleaning Joe Everhart Larry & Barbara Cash Logan & Heather Birch Marathon Mark & Laurie John Matanuska Valley Federal Credit Union McKinley Capital Management RNV Taco Bell of Alaska Talitha Birch Kindred Tangerine Promotions Usibelli Foundation
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JUNIORACHIEVEMENT ACHIEVEMENT DONORS JUNIOR SPECIAL SECTION
Congratulations 2020 Volunteer of the Year:
Calais Company Delta Constructors Derrell Webb Doug & Jana Smith Dowland-Bach Corporation FedEx Holland America Line Kevin Van Nortwick Mark Smith Marsh USA Mary Hughes & Andrew Eker Matson NANA Worley Parsons Parker Smith & Feek Penco Petro Star SolstenXP Tom Redmond TOTE Maritime Udelhoven Oilfield System Services Weaver Brothers
JUNIOR ACHIEVEMENT SPECIAL SECTION
Showing Up and Working Hard
Aaron Schutt on education, business, and the next generation
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how up on time and work hard with a good attitude,” is the advice that has guided Aaron Schutt from his first job at Fast Eddie’s Restaurant in Tok through his career path to today as president and CEO of Doyon. “I’ve changed career paths and education paths so many times. Through all of that it’s about knowing you can be successful if you work hard and spend the time to find people to help you,” says Schutt. Family and mentors play a huge role in Schutt’s life and career. From the time he was a young man working at Fast Eddie’s through university and the various iterations of his career, having positive role models helped Schutt navigate life. Starting with his parents, who were both teachers. “The biggest thing that influenced my life was that focus on education and the importance of it,” Schutt says. After excelling in high school, Schutt headed to college feeling nervous but ready. “When my [twin] brother and I decided to go to university Outside, it helped that I had someone to go with. The culture shock of going from about eighteen kids in your class to a university of 25,000 undergraduates is a huge deal and it’s hard to do. But I had someone with me who was the same age on a similar path,“ he says. Then he met a college advisor who would both shake him and serve as a life-long motivator. “I remember my first year, I’d done really well in high school, a rural school, and I get to this big public university and my advisor says, ‘Yeah you’ll probably fail out. Your [high school] grades don’t matter here.’ It was really a negative message,” Schutt says. “It was one of those really motivating points for me. Even though it was negative, I carried that with me for many years. Including now, don’t underestimate people.” Schutt graduated with honors from Washington State University with a bachelor’s of science in civil engineering. But his educational path
44 | January 2020
wasn't quite done yet, so he moved further south to attend Stanford University, where he obtained his master’s in civil engineering. “I avoided business as a profession for a long time. I was trained as an engineer and then I made the switch to law and was very into that. [Business] became an opportunity for me mid-career,” he says. After attending Stanford, Schutt decided to attend [Stanford] law school on a whim. “My brother had gone to law school about a year before I graduated and suggested I do the same… My advisor was saying, ‘You’re going to stay for your PhD right?’” So Schutt settled in the matter in the most rational way possible: he flipped a coin. “It worked out for me,” he laughs. Over the course of nine years, Schutt obtained three degrees before moving back to Alaska to embark on his career as an attorney working in private practice. Schutt’s career path took an unexpected turn when then-President and CEO Orie Williams asked him to join Doyon. “I gave him what I thought was a very clever answer. I said, if you can convince Marissa [Schutt’s wife] that it’s a good idea for me to come work for Doyon, then I’ll do it. And I thought there was no way that would ever happen.” Schutt was proven wrong. “She came home and said, I think you should consider going to work for Doyon. I just about fell out of my chair,” he laughs. Schutt joined Doyon in 2006 and was named president and CEO in 2011 after serving in various upper management roles. And though he never really saw himself working in corporate life, he feels at home at Doyon. “Doyon’s commitment to honesty and integrity is one of the reasons I chose to come here and one of the reasons I’ve stayed so long,” he says. “Where I grew up, your word was everything. It’s great to work and live around people who share that principle.” His advice to kids today is to find
good mentors to help along the way. “There are lots of great people out there. Mentors have been a huge part of my success,” he says, noting that there have been so many people who have influenced his life in a positive way that naming just one is impossible. Other advice? “Put down those devices. Read books and talk to people.” Schutt says the best way for the business community to support the next generation is to offer themselves as mentors and teachers. “Spend time with them in these various programs [such as Junior Achievement]. Offer them the opportunity to see what everyday life looks like so they can make good choices about training and further education after high school and what might fit best with their interests and personalities,” Schutt says. “And teach them life skills. We have an obligation to make sure our kids can be successful, not just read and write and do basic math but how to apply all of that to everyday life.” As for his life and legacy, Schutt says there is no one thing he’s most proud of in his long and esteemed career. “I try not to focus on the past. It’s always what’s in front of me. What makes me happy at work is when I see the people around me and our organization succeed,” he says. “At the end of the day, all I really care about is that my wife and my kids love me and that I’m able to come to work everyday and enjoy what I do. And I’ve been fortunate to have all of those things.” Looking forward, Schutt says he sees a bright future for Alaska’s next generation. “I’m a huge believer in our state. I grew up here, I’ve chosen to have my professional life here. [Alaskans] have a strong can-do attitude and we have to be tough... and to thrive and succeed and see these Alaskabased companies displacing large global competitors gives me hope. We have such abundant resources here, heritage, and great people. There’s nothing we can’t do as Alaskans.”
Alaska Business www.akbizmag.com
A L A S K A N AT I V E
Long-Term Relationships Regional and village corporations in mutually beneficial land, resource agreements By Vanessa Orr
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he Alaska Native Claims Settlement Act (ANCSA) was passed in 1971, establishing 12 regional corporations and more than 200 village corporations throughout the state. And while the act required that regional corporations and village corporations 46 | January 2020
share possession of their traditional lands and the resources harvested from them, a number of these entities have chosen to partner in other ways as well. In some cases, regional corporations have provided education and training to members of village corporations so
that they could gain ground in specific business areas, such as the federal contracting arena. Other times, they have assisted village corporations when their communities were in need or when they required the support or backing of an entity with more resources. Working
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“It is inherent in ANCSA that village corporations work alongside regional corporations. While we own the surface resources of our land, Bristol Bay Native Corporation owns the subsurface resources. We allow access to subsurface resources—currently only gravel and rock underneath our surface holdings—and they contract with us to manage that resource for them. We share royalties from sales.” Cameron Poindexter, President/CEO, Choggiung
together, both types of corporations provide scholarships to shareholders and their descendants and job opportunities through shareholder hire programs.
Sharing the Land Through ANCSA, village corporations generally own surface rights to the lands they were granted and regional corporations own the subsurface estate, including mineral rights. Because of that, natural resource projects require communication and coordination between the corporations, even beyond ANCSA’s 7(i) and 7(j) natural resource revenue sharing requirements. “It is inherent in ANCSA that village corporations work alongside regional corporations,” explains Cameron Poindexter, president and CEO of Choggiung, the village corporation for Dillingham. “While we own the surface resources of our land, Bristol Bay Native Corporation (BBNC) owns the subsurface resources. We allow access to subsurface resources—currently only gravel and rock underneath our surface holdings—and they contract with us to manage that resource for them. We share royalties from sales.” Calista Corporation has a similar relationship with village corporations in its region. “Calista contracts with parties that want to purchase sand and gravel, and then pays a share from those sales to the village corporations that own the land surface,” explains Mary Martinez, land planner for Calista. “It is payment for extraction of materials and access to its lands.” The ties of subsurface and surface land management allow all entities in-region to benefit even when a corporation partners with a non-ANCSA entity. www.akbizmag.com
Alaska Business
January 2020 | 47
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haring revenues from natural resource development is one of the core tenets of ANCSA, which granted village corporations the surface rights and regional corporations the subsurface rights to the lands that were conveyed to them in the agreement. Revenue sharing requirements have enhanced cooperation between the village and regional corporations that own the 44 million acres that were transferred by the federal government through ANCSA and has created opportunities for economic growth for those organizations and the regions and villages they serve.
Sharing the Wealth
How ANCSA Revenue Sharing Works
48 | January 2020
ANCSA transferred land titles to twelve Alaska Native regional corporations and more than 200 village or urban corporations. According to the ANCSA Regional Association, because some land areas were richer in natural resources and had more potential for economic development, it was necessary to provide for other regions that did not have that advantage. ANCSA’s revenue sharing provisions, which are contained in sections 7(i) and 7(j), ensure that all Alaska Native corporations and their shareholders benefit from revenues derived from natural resource development on ANCSA lands. Section 7(i) requires that any revenues an Alaska Native regional corporation receives from ANCSA lands (for example, from timber resources or natural resources in subsurface estate) must be shared in a 70/30 split. Seventy percent of the revenue is disbursed to the other Alaska Native regional corporations and the remaining 30 percent is kept by the regional corporation that developed the natural resource. Section 7(j) ensures that revenues from natural resource wealth are shared with Alaska Native village corporations. The regional corporations disburse 50 percent of the Section 7(i) revenues they receive to Alaska Native village corporations within the region. Village and urban corporations are not required to distribute any of this revenue sharing to other village corporations or to regional corporations. While Section 7(i) has succeeded in creating an economic leveling effect among Alaska Native regional corporations, its reach has been felt throughout the entire state. The ANCSA Regional Association reports that in FY2015, Section 7(i) distributions represented $352 million in total economic activity, including an estimated 2,300 to 2,800 jobs. In 2018, the ANCSA Regional Association commissioned a report by McDowell Group on the economic impacts of Sections 7(i) and 7(j) of ANCSA. Among other discoveries, the report states that every Alaska Native regional corporation has had periods during which it received more 7(i) payments than it paid out, making all twelve of the regional corporations and their shareholders Section 7(i) beneficiaries. It also found that the redistribution of wealth among the regions receiving these revenues had achieved the “leveling effect” in economic activity that it was designed to provide. ANCSA—which at the time was the largest land claims settlement act in US history—has had a tremendous impact on the Alaska Native population and the state itself. In FY17 alone, Alaska Native regional corporations had a combined revenue of $9.1 billion and employed more than 15,000 people in Alaska with a combined statewide payroll of more than $950 million.
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For example, Calista and Knik Construction Co. partnered to form joint venture Nunalista, a heavy equipment construction company specializing in remote-site projects. Nunalista operates gravel pits and rock quarries in the Calista region, including hard rock quarries in Platinum and Kalskag. “Under this joint venture, Calista gets royalties from the material extraction and shares those royalties with the surface owner, which in the case of Kalskag is The Kuskokwim Corporation,” says Martinez. Calista enters into material sales and pit management contracts with village
This year, Calista Corporation subsidiary Brice Inc. operated a new quarry at Mertarvik that is an essential component of the Newtok village relocation project. Calista Corporation
“Calista has materials sales contracts with the city of St. Mary’s and the city of Mountain Village to manage and operate its gravel pits. A royalty is paid for minerals sold locally or exported out of [the] community, and a percentage of that is shared with the surface owner.” Mary Martinez, Land Planner, Calista Corporation
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corporations, tribal entities, and city governments. “Calista has materials sales contracts with the city of St. Mary’s and the city of Mountain Village to manage and operate its gravel pits,” says Martinez. “A royalty is paid for minerals sold locally or exported out of community, and a percentage of that is shared with the surface owner.” In this case, royalties are shared with St. Mary’s Native Corporation and Azachorok Inc., respectively. Calista also owns the subsurface estate and some surface lands at the Donlin Gold project, operated by Donlin Gold, which contains one of the largest known undeveloped gold deposits in the world. The Kuskokwim Corporation owns most of the surface lands, and both corporations reached agreements with Donlin Gold to work together to develop the mine in a way that benefits their shareholders and the region. According to Martinez, the development of these natural resources allows Native corporations opportunities to generate jobs within local communities. “Calista Corporation has dedicated staff who work specifically with shareholder hire, encouraging the contractors to train and employ shareholders and shareholder descendants,” she says.
Promoting Business Opportunities When BBNC offered village corporations the opportunity to work with it on a new initiative, Choggiung leapt at the chance. “Several years ago, Bristol Bay Native Corporation launched an in-region government contracting initiative in which they invited villages to learn about federal contracting and the SBA 8(a) business development program,” explains Poindexter. “They provided education to the boards and management of village corporations in their region and launched partnerships with several of the villages that were especially interested in getting into federal contracts. “Since BBNC launched the initiative in 2015, Choggiung has taken great advantage of what we learned by starting up two new companies which were successfully certified in the SBA 8(a) program,” he continues. “Subsequently, BBNC was looking to 50 | January 2020
further assist village corporations in the region by selling one of its construction brands, and they invited us and other village corporations in Bristol Bay to compete for the opportunity to become a BBNC business partner.” According to Poindexter, Choggiung had both the management capacity and the financial capacity required to make the purchase, and in 2018 became the sole village investor and business partner in Bristol Industries, the holding company that owns the Bristol Alliance of Companies.
Through ANCSA, village corporations generally own surface rights to the lands they were granted and regional corporations own the subsurface estate, including mineral rights. Because of that, natural resource projects require communication and coordination between the corporations. As a result, in the space of less than a year, Choggiung grew from a company with $8.4 million in annual revenue in fiscal year 2017 to a powerhouse earning $95 million in annual revenue in its most recent fiscal year. “Our village corporation’s relationship with our regional counterpart is very unique among Alaska Native corporations,” says Poindexter, adding that Choggiung is incredibly proud to work alongside BBNC. “They still have an interest in the company, but we own the controlling interest.
“Not many other regional corporations work with village corporations in such a significant way,” he adds, “and we are absolutely 100 percent grateful for our business relationship.”
Preparing for the Future While finding ways to work together can provide huge economic advantages, both regional and village corporations also understand the importance of combining their efforts to preserve their cultural traditions and lifestyles. For the past two years, Choggiung has partnered with the BBNC Education Foundation to host a fundraiser to raise money for scholarships for BBNC and Choggiung shareholders. “The BBNC Education Foundation wanted to do a fundraiser based around our world-class fishery and the land resources we own along the Nushagak River,” says Poindexter. “They organize a fishing derby during the king salmon run, and we provide access to our land and a hub for weigh-ins. BBNC’s Education Foundation organizes cultural education on-site during the event for participants. The event not only raises money for scholarships but also provides a heightened awareness for the importance of this resource to our people and culture.” Regional corporations also step in when a village in their region needs a helping hand. When more than 100 residents of Newtok had to move nine miles southeast to Mertarvik as the result of flooding, erosion, and permafrost melt, Calista and its subsidiary, Brice Inc., helped make the new village a reality. Brice Inc., a group of companies that provide civil construction, marine services, materials, and rental equipment, created building pads, roads, and other local infrastructure from a quarry owned by Calista (subsurface rights) and Newtok Native Corporation (surface rights). Without rock from the quarry, transporting construction materials would have been much more expensive. And the quarry also provides revenue to Newtok Native Corporation, as Calista paid the village corporation for access to its lands during the extraction of material.
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MINING
Digging into Geotechnical Engineering
52 | January 2020
Specialty expertise supports safer, more efficient mining operations By Isaac Stone Simonelli
Alaska Business www.akbizmag.com
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limate change is putting additional pressure on the already complex, yet vital, role geotechnical engineers play in the Last Frontier's mining industry. It is an issue the engineering community is working to address according to HDL Geotechnical Services Manager Doug P. Simon. "We are often designing projects that we hope will last for decades, and climate predictions are estimates at best with no one knowing for certain what the climate will look like in ten years, let alone decades from now," says Simon. "Geotechnical engineers need to stay informed about the latest information on the climate predictions and how to incorporate the uncertainties into designs.�
Geotechnical Reports Projects with proper funding and organization usually bring on a geotechnical engineer as one of the first planning steps, explains Cody Kreitel, a geotechnical engineer for PDC Engineers. The goal of the suite of geotechnical services offered by engineering firms is to characterize the subsurface conditions at a project site so that developers are aware of any challenges involved with creating the stability necessary for a structure, road, airfield, dam, or even to keep a mine from failing. Alaska's diverse geology creates a variety of challenges for such engineers, who must rule out various solutions depending on the soil matrix of a site, which can include deep organics that have no load bearing capacity, permafrost, and the liquefaction potential of saturated sands. "Liquefaction is when, due to cyclicloading, a saturated loose soil will build up excess pore pressure in between the soil grains and, during the shaking [from an earthquake], the soil behaves like a fluid," Kreitel says. "We saw the effects of that during the earthquake last year." Kreitel says that despite the necessity of having a geotechnical report for a project, developers sometimes get "sticker shock" from the price of the services, particularly for projects being developed in remote locations since transporting the tools and sending a team to such sites to collect samples is an expensive endeavor. Once a geotechnical engineer has www.akbizmag.com
Conveyor foundation construction taking place at Fort Knox Mine. Shannon & Wilson
collected samples and conducted laboratory tests on them, he or she will put together a report for the client, Kreitel explains. "A geotechnical report presents all of the data I've collected and then recommendations to the designers for the design and construction of whatever project they're working on," Kreitel says. "Sometimes it's a pretty lengthy Alaska Business
geotechnical report that lays out what they need to know about the subsurface so they can proceed with their design." One industry that doesn't tend to balk at joining forces with geotechnical engineers is the mining industry, which has a long history of relying on their services to safely extract resources. "While the science and engineering of geotechnics [became] more fully January 2020 | 53
Early design reconnaissance for a potential surface mining operation in Southcentral Alaska. Shannon & Wilson
developed as a separate field in the early 1900s, the art of geotechnical engineering has been an integral part of mining as long as mining has existed. For centuries, the people operating mines have figured out how steep they could cut slopes or stack stockpiles. This process was often by trial and error and, at times, resulted in deaths at the mine," Simon says. "As our understanding of the principles of soil mechanics grew, so did our ability to predict how materials would behave. Thus, the role of geotechnical engineering has evolved from one of purely trial and error to one where we can better predict how soils will behave and provide safer designs."
Geotechnical Data for Mines Geotechnical engineering plays a critical role in the mining industry in Alaska, agrees Kyle Brennan, vice president and manager of the geotechnical department of Shannon & Wilson's Anchorage office. "Geotechnical engineers work with civil and structural engineers to support mining operations by designing mine 54 | January 2020
features as simple as a gravel road that supports mining activities and access and as complex as a tailings dam," Brennan says. Simon notes that geotechnical engineers are responsible for ensuring that the materials stored as part of the mining process will be stable and the stockpiles and storage piles won't fail through unacceptable settlement or movement. Geotechnical data and analysis are used to help maintain the safety of the mine and those working there. It provides operators the information necessary to make educated decisions about the potential impacts of changes in the way materials are handled and stored. "Geotechnical engineers will develop designs for facility foundations [buildings, conveyors, communications towers, dams, roads]; develop recommendations for retaining walls and other earth-retention structures; evaluate slope stability [earthen fills, excavations in rock and soil]; and evaluate groundwater hydrology for dewatering and mine drainage,"
Brennan says. How water interacts with the surface and subsurface at a mining site significantly impacts the design recommendations put forward by a geotechnical engineer. "By their very nature, mines are large earth disturbing operations, and thus are required to follow strict regulations to control surface and subsurface drainage of water off of the mine site," Brennan says. "Controlling, collecting, and treating mine run-off requires an understanding of surface and subsurface interflow to efficiently and reliably handle water run-off from a mining site. Geotechnical engineering is used to help design the facilities that handle the run-off, and hydrological environmental services are employed to determine how specifically the run-off is to be treated before discharge." Because mines typically have a variety of facilities that are constructed during development and maintained over the life of the mine, nearly all geotechnical subdisciplines are required for mine work, including soil and rock mechanics, seismic engineering, and subsurface
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thermal modeling. In providing these services, geotechnical engineers face an array of obstacles presented by the state’s geological and climate conditions. These mining developments are further complicated by limited ground transportation and access to resources. "The key in overcoming the challenges associated with conducting geotechnical work for mining projects in Alaska is the same for all geotechnical work in the state regardless of the type of development. Geotechnical solutions need to be tailored to the specific conditions at each site because prototypical solutions seldom work from site to site," Brennan says. "As geotechnical engineers, we are often tasked with figuring out creative ways to use the local conditions or locally-available resources to solve design problems. Coming up with these solutions requires a strong knowledge of geotechnical fundamentals and broad experience with Alaska’s unique geotechnical challenges and unconventional design approaches and how to apply them to meet today's design and safety standards."
"The key in overcoming the challenges associated with conducting geotechnical work for mining projects in Alaska is the same for all geotechnical work in the state regardless of the type of development. Geotechnical solutions need to be tailored to the specific conditions at each site because prototypical solutions seldom work from site to site.” Kyle Brennan, Anchorage Geotechnical Department Manager, Shannon & Wilson
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Regional Challenges For mining projects in northern parts of Alaska, permafrost is a primary concern. Permafrost, in general, is relatively stable when it stays frozen. However, ground-disturbing activities or development of buildings in permafrost regions can significantly change the thermal regime of the subsurface and thereby have significant impacts on how a site performs over the life of the facility, Brennan explains. Designing structures that don't warm the ground allows the Arctic and near-Arctic cold climate to keep the frozen ground stable. Conversely, heating methods can be used to melt the permafrost and allow it to settle. Either way, Brennan says careful consideration is needed when working on a permafrost site. "Some basic strategies for addressing permafrost issues include using insulation and thermal siphons to help maintain cold ground temperatures," Simon says. "If you are looking to thaw portions of the permafrost, you can let our warming summers help you, or there www.akbizmag.com
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"Liquefaction is when, due to cyclic-loading, a saturated loose soil will build up excess pore pressure in between the soil grains and, during the shaking [from an earthquake], the soil behaves like a fluid… We saw the effects of that during the earthquake last year." Cody Kreitel, Geotechnical Engineer, PDC Engineers
are ways to actively thaw the permafrost with heat pumps." One of the more difficult challenges geotechnical engineers face in Alaska is not permafrost; it’s intermediate geomaterials. Such material will usually appear to be solid bedrock but end up behaving more like soil from an engineering standpoint. "One of the challenges is that the behavior of the materials may not be known or anticipated until you are in construction or have exposed the materials," Simon says. "Dealing with these materials often involves a process of observing the materials, developing and implementing one or more strategy, monitoring the performance, and making further adjustments as needed." For example, to account for intense rainfall in the Southeast, geoengineers rely on surface drainage with armoring, capping stockpiles, and adding drainage/ collection systems under the stockpiles.
Sustainable Design Given the scope of geoengineering services and the massive quantities of materials used, creating sustainable solutions to the complex problems faced is tough, says Simon. "However, some of the ways we can try to incorporate sustainability into our designs is to keep it simple and apply the principles of OHIO [only handle it once] so that the large quantities of materials only have to be hauled once, thereby reducing emissions and costs. Other ways include trying to use the materials already available at a site rather than importing materials," Simon says. Another way to improve sustainability is to incorporate waste material from 56 | January 2020
mining operations in the construction and expansion of mine sites, says Steve Adamczak, vice president and manager of the geotechnical department of Shannon & Wilson’s Fairbanks office. "Mine tailings and crushed reject material is used on projects at mine sites to stabilize cut slopes, provide subbase and surfacing materials for haul roads and access roads, compacted subgrade bearing material for structure and conveyor foundations, and material to construct earthen structures; this reduces the need for disturbing natural areas and developing borrow sites," Adamczak says. Despite the upfront expenses faced by the mining industry and developers when contracting a geotechnical engineer, the results save companies money in the long term, Kreitel says. "It's all about managing that risk, trying to reduce the risk of either constructionrelated cost overruns or performance issues down the road," Kreitel says. Brennan agrees that the services not only create safer mines but create more profitable mines. Mining operations require extraction of resources as efficiently as possible to maximize the return on the investment, Brennan and Adamczak both say. The role of geotechnical engineering is to provide creative and efficient solutions to soil and rock stability and support capacity for mine infrastructure design challenges that are encountered during mine development and operations, they explain. When engineers investigate subsurface conditions and geologic terrain and use local materials to provide lower-cost sustainable design
alternatives, they have a direct impact on the bottom line of a mining operation, Brennan says. "Sustainable mine development requires the input of geotechnical engineering to assess seismic, slope stability, permafrost thaw, and erosion hazards, as well as water supply on infrastructure and mine operations," Brennan says.
Changing Climate However, the impacts of the rapidly changing climate conditions are forcing geotechnical engineers to make assumptions about an uncertain future when assessing sites. “Geotechnical designs for long term projects must consider the impacts of possible warming permafrost on the stability of slopes, infrastructure, and foundations; changes in precipitation/snowfall and effects on earth structures and surface water; and accessibility of sites if ice road construction or exploration sites must be accessed in the winter,” Adamczak says. "Climate change has a significant impact on geotechnical engineering in Alaska, especially in zones where permafrost is present and can also impact non-permafrost areas. In order to determine how a project will impact the thermal regime of the subsurface, assumptions need to be made regarding natural climate conditions into the future over the life of a project," Brennan says. "Small changes in the climate can have significant impacts to the stability of permafrost soils and accommodating these impacts can often have substantial cost implications."
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OIL & GAS
Rescuing Alaska’s Stranded LNG Alaska's public and private entities continue to explore options to bring North Slope LNG to market By Tasha Anderson
A
ccording to Setting the Bar for Global LNG Cost Competitiveness, published in October by McKinsey & Company, a global market intelligence and analytics group focused on the energy sector, “By 2035, global liquefied natural gas (LNG) demand is expected to increase to between 560 million metric tonnes per year (MTPA) and 600 MTPA, up from 315 MTPA in 2018.” But that looming demand is no secret. From October 2018 to October 2019, eight LNG projects have reached a final investment decision (FID), boosting available supply by 84 MTPA,
58 | January 2020
and “this capacity addition is expected to prolong excess supply in the global LNG market into the late 2020s, well beyond the 2022-2023 forecast of just a year ago. However, the Qatar North Field LNG Expansion—the world’s most costcompetitive source of LNG, expected to add a further 33 MTPA of supply—may, depending on its construction start date, extend the expected period of oversupply by a couple of years. “Taking into account existing supply, recently announced post-FID projects, and Qatar North Field LNG Expansion, we expect that an additional 100 MTPA
to 140 MTPA of new LNG supply will be required to meet demand: the equivalent of adding 25 standard LNG trains globally. However, more than 100 projects totalling 1,100 MTPA of proposed capacity are in contention to fill this supply gap, indicating that global competition among pre-FID supply projects is set to rise sharply.” Short and sweet: Alaska’s approximately 32.4 trillion cubic feet of stranded natural gas resource is likely to remain stranded unless a globallycompetitive project can be planned and constructed relatively quickly (in
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industry terms). The good news for Alaska is that, according to McKinsey, approximately 50 percent of global gas demand growth by 2035 is expected to come from Asia—already the largest region for Alaska exports internationally. This growth is “supported by population increases, greater wealth, rural electrification schemes, and gas’ rising share of national primary energy mixes,” according to a Nexant report, Global LNG Outlook. Through 2040, additional demand is also expected in the Middle East, Africa, Latin America, Asia Pacific, and North America. So what are Alaska’s options to enter the LNG market instead of injecting a highly valuable commodity back into the ground?
ASAP In March the Alaska Gasline Development Corporation (AGDC) secured the final federal permit needed to make a FID on the approximately $10 billion Alaska Stand Alone Pipeline (ASAP). Instead of delivering natural gas to global markets, this 733-mile pipeline would provide natural gas to Alaskans. While this milestone is significant for the project, the project itself has been more or less shelved. AGDC’s website describes ASAP as a “backup project,” and ADGC Interim President Joe Dubler says it’s “uneconomic.” He continues, “The state of Alaska will not pursue any LNG project on its own, period. The private sector is desirable in large projects to ensure that only those projects that meet economic hurdles will be built. Since the ASAP line was not economic, no private entities would participate, causing AGDC to abandon the effort.” There is precedence for fully-statefunded industry projects going awry. Dubler gives the example of a seafood plant built in Anchorage in the late ‘90s using $50 million in state funds. The 202,000-square-foot factory was intended to provide 450 jobs and create an Alaska-based value-added market for Alaska salmon. Instead the plant closed its doors in 2003 and the facility was sold in 2005 to a private entity (after renovations to meet building codes for educational and public use, today the building is occupied by ChangePoint church). ASAP’s goal was to provide natural gas www.akbizmag.com
to Fairbanks, Southcentral, and other areas of Alaska. However, Southcentral Alaska is already using natural gas supplied by operations in Cook Inlet, and moving north, the Interior Gas Utility (IGU) announced in October it would begin receiving LNG fill deliveries at the end of November. IGU General Manager Dan Britton said of the project in October, “Balance of plant work is one of the final steps toward completing the construction of our 5.25 million gallon LNG storage facility designed to provide security of winter supply and increase access to natural gas for thousands in our community… This is a massive step forward for affordable, clean-burning energy.” IGU is also being supplied by Cook Inlet operations. Alaska’s natural gas needs just aren’t significant compared to global markets and don’t justify a $10 billion project to transport natural gas from the North Slope, especially with ongoing innovation and development of natural gas in Cook Inlet.
Alaska LNG If AGDC’s backup is a non-starter, how is Alaska LNG—the entity’s current
focus—shaping up? It’s moving forward, though with a more conservative mindset than in previous years. While under previousGovernor Bill Walker the state aggressively pursued the project, even potentially considering a FID regardless of private investment, Governor Mike Dunleavy’s deep concerns with state budget spending levels led him to order a “full project review” of Alaska LNG in January 2019, which coincided with new appointments to AGDC’s board of directors and Dubler’s appointment as interim president. Shortly after his appointment, Dubler said, “AGDC plans to seek strategic investors as part of the project viability review in 2019 in order to advance Alaska LNG and share in the risk.” In February, he told the legislature, “If it is viable we are going to solicit world-class partners for FEED… if we do all of our work and we determine that the project does not look like it’s going to be viable, we will wind the project down, close the corporation up, and return all current funds that remain to the General Fund.” Similar to ASAP, without private investment, the state will not proceed
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“[Qilak LNG] will benefit Alaskans in several ways: the expansion of the Point Thomson field, that this project enables, will create many new construction jobs and will significantly increase condensate production into TAPS.” David Clarke, COO, Qilak LNG
with Alaska LNG. But that decision hasn’t been made yet. The public comment period for the draft EIS closed in October, and a final EIS is on track for March 2020, Dubler says. A FID will follow, though the timeline on that is uncertain, as it requires funding partners to be secured. In May BP and ExxonMobil committed up to $20 million ($10 million each) to move Alaska LNG through the federal environmental review process, and the two entities have been working with AGDC to look at how the project can be made more competitive. Of course BP has now sold its assets to Hilcorp and will cease operations in Alaska. Dubler says, “Short term, there should be no impact [from the sale]—BP has committed to fulfilling their obligations under our funding agreement. Long term, the impact will need to be determined.” As of press time Hilcorp has not indicated its intentions for the project, though in years previous the company has been positive about Alaska LNG. Hilcorp’s participation will be vital, as if the sale passes regulatory hurdles, the
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company will own a one-third share of the Point Thomson gas field, valued at $4 billion and operated by ExxonMobil. Another uncertainty related to Alaska LNG is where to build the project’s liquefaction plant and marine terminal. Alaska LNG’s preferred site is in Nikiski on the Kenai Peninsula, which the Kenai Borough supports; however, the Matanuska-Susitna Borough contends that facilities should be built at Port MacKenzie. According to Mat-Su, Kenai Boroughs Continue Arguing Over Project Site Review written by Larry Persily in October, “The Mat-Su accused the state team and Kenai Borough of misrepresenting one of the project’s many objectives—to serve Southcentral Alaska—in a ‘blatant attempt to eliminate all reasonable alternatives in order to rig the process in favor of Nikiski.’” With the question raised, Valdez also joined the fray. “The City of Valdez has also asked FERC to add to its review. Valdez has argued that its community on Prince William Sounds is a better site than Nikiski, on Cook Inlet, and that the draft EIS failed to ‘rigorously explore and objectively evaluate’ the pipeline route and LNG terminal site at Valdez,” Persily wrote. Thus far the arguments haven’t delayed the project, but they could. Dubler is optimistic about a good resolution for all parties, but “I still feel that the extensive engineering we have done has proven that the Alaska LNG facility location [in Nikiski] is the best for the project,” he says. Dubler’s vision for Alaska LNG is steady forward movement with private participation. “I would like to see us get a final EIS from FERC and use the updated cost numbers we are gathering to see if the project can be competitive. If so, I would like to see private sector builders/ owner/operators take over and build it. Our grandkids deserve the same Alaskan opportunities that we had.”
Qilak LNG That opportunity this time around may take a different form than an 800mile pipeline. Qilak LNG, a subsidiary of Lloyds Energy (a LNG portfolio developer headquartered in Dubai), is proposing to build a near shore liquefaction plant (NSLNG) and shipping LNG to Asian markets directly from the North Slope. 60 | January 2020
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The company hasn’t finalized an exact development plan and currently has three ideas for the liquefaction facility. “The first option is to mount a liquefaction plant on a grounded barge next to an offshore barrier island (similar to the Snohvit LNG project in Norway and the Seawater Treatment Plant at Prudhoe Bay). The second option would build an ice resistant harbor located about 6 miles offshore that accommodates the NSLNG plant and will provide sheltered LNG loading. The third alternative under consideration would bring a large gravity based structure to an offshore location that will accommodate liquefaction, storage, and offloading (similar to the recently sanctioned Arctic LNG 2 project in Russia),” the company states. Qilak LNG believes there are several advantages to its project over Alaska LNG: no pipeline is required, reducing costs and reducing constructionrelated environmental impacts; the facility can be built off-site “in a shipyard under very controlled conditions which minimizes the risk of
overruns”; and the LNG facility will run more efficiently on the North Slope because of the colder climate. Qilak LNG would be a smaller project than Alaska LNG, with a planned capacity of 4 MTPA to 8 MTPA, versus Alaska LNG’s 20 MTPA. Additionally, because of the smaller scale, Qilak LNG would provide approximately 200 Alaskans with jobs during construction and about the same after construction, while Alaska LNG potentially created thousands of jobs throughout its construction and operations. But direct job creation doesn’t accurately reflect other positive impacts for Alaskans. Qilak LNG COO David Clarke says, “The project will benefit Alaskans in several ways: the expansion of the Point Thomson field, that this project enables, will create many new construction jobs and will significantly increase condensate production into TAPS, providing additional royalties to support the PFD. Additional property (ad valorem) taxes will be paid to the state and the North Slope Borough.” The company is estimating a project life of twenty years, though Clarke says, “This could be extended if the gas is
The same, only better
produced at a slower rate or if additional fields are tied in; alternatively, it could be shortened if the gas is produced at a higher rate.” While it’s not guaranteed, Qilak LNG is looking at ways that natural gas could still be distributed to communities in the Alaska Arctic and in Western Alaska. “We appreciate that affordable fuel is vitally important to coastal communities,” Clarke says. “We are prohibited by the Jones Act from delivering gas in our fleet of large ice breaking LNG carriers [as the current fleet is comprised of vessels constructed outside the United States] from the North Slope to ports within Alaska… Once the market is established and our project is operating, smaller, purpose-built and Jones Act compliant vessels could also deliver gas from the North Slope, perhaps through a hub in the Aleutians or Port Clarence.” While a pre-feasibility study has already been conducted for the project, a more comprehensive feasibility study was being planned at the end of 2019, and Clarke says Qilak LNG plans to kick it off early this year.
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Alaska Business
January 2020 | 61
CONSTRUCTION
Keeping Alaska’s Pioneering Spirit Alive The Remote Recreational Cabin Sites program helps residents build their dreams By Sam Davenport
62 | January 2020
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T
he Alaska Department of Natural Resources (DNR) provides Alaskans with an opportunity to get off the beaten path with the Remote Recreational Cabin Sites (RRCS) program, which offers state land for private ownership in remote areas of the state. But before Alaskans can begin building the cabin of their dreams, a lot needs to happen.
The Process DNR Resource Specialist Justin Wholey says the first step requires DNR staff to research and identify potential staking areas, after which the public is given a chance to comment on the chosen areas. Once the public comment period closes, the director’s office chooses which staking areas to approve. When a decision has been made, the staking brochure announces the areas that are being offered, and the drawing application period is opened. For 2019 the application period was open from August 19 through October 11. After the application period closes, names are drawn for staking authorizations, including winners and alternates. Those authorized stakers receive instructional documents and are given access to staking workshops, which help them better understand the required fieldwork. At that point winners are allowed to stake and turn in their lease applications in the first staking period. Wholey says alternates may be allowed to stake and turn in lease applications during the second staking period if staking authorizations were not all used by the winners. Successful stakers sign a three-year lease and start making quarterly payments. During this time, the land is surveyed
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and appraised by DNR. At the end of the lease, the lessee can either enter into a sale contract or receive patent—or enter into an optional five-year lease extension prior to purchasing. To be eligible to stake a parcel in the RRCS program, applicants must be current Alaska residents and eighteen years of age or older. Corporations, businesses, and non-Alaska residents are not eligible to apply for the program. DNR’s Natural Resource Manager II Timothy Shilling says it is the pioneering and Alaskan spirit that drives people to apply for the program. “It is a means by which we can allow people to select a piece of land that works best for their needs,” Shilling says. “And it really gives a recreational opportunity to a lot of folks who haven’t had that.” Roughly 30 percent of those who win staking authorization make it through the entire process and purchase their parcel. Rachel Longacre, Chief of Land Sales Section for DNR, says the DNR office tries to increase the number of applicants completing the process by providing as much information as possible upfront—from YouTube videos to workshops that guide applicants through the process and requirements for the state and the applicant. “The reason that it’s so low—the actual success rate—is because it requires a lot of effort by the customer, by the applicant, to complete those tasks and get out there on the property,” Longacre says. “Sometimes, they’ll get out there and go, ‘Oh, you know what? This is too much work for me,’ or, ‘I need to have more four-wheelers.’” Wholey adds that once the stakers have their parcel staked, about 90 percent of them end up purchasing.
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January 2020 | 63
“I really like the idea of choosing my own spot to build a cabin... This program is as close to the Homestead Act [which ended in the 80s] as you can get in Mankomen Lake is one of the staking areas that was available to Alaskans this year through the Remote Recreational Cabin Sites program.
modern times.” Caleb Shoulders, Stake Authorization Winner
Department of Natural Resources
2019 Program Last year, four staking areas were offered, two of which were Innoko II and Mankomen Lake in Southcentral Alaska. The Innoko II staking area is located along the North Fork of the Innoko River, 195 air miles southwest of Manley Hot Springs and 68 air miles northwest of McGrath. The area can be accessed by boat in the summer and snowmachine in the wintertime. Currently, there are forty-one remaining authorizations for the staking area. Mankomen Lake is 30 air miles east of Paxson and 53 air miles southwest of Tok. The staking area can be accessed by float or ski plane or the Revised Statute 2477 trail system from Mentasta or Chistochina. There are twenty-five staking authorizations still available. Caleb Shoulders is one of this year’s winners. “I really like the idea of choosing my own spot to build a cabin,” Shoulders says. “I currently already have my own place that I have built, and while I like the land it is on, it would be nice to pick a specific location I like best. This program is as close to the Homestead Act [which ended in the 80s] as you can get in modern times. I like the challenge of exploring a remote area I have never been to before, especially one with a harsh environment.” Shoulders says he will likely have to fly to his parcel to stake the land, but his experience surveying will come in handy 64 | January 2020
to mitigate the risk of improperly staking. “I think this program is a great opportunity for Alaskans to challenge themselves in a way most don’t get to nowadays,” Shoulder says. “For future people [who] want to participate in this program, just know that the staking areas are extremely remote, and it will take massive time and money investments to develop your parcel. It is not as simple as ‘go pick some land you want’; it must be properly staked and ultimately purchased from the state for full market value. In short, staking your own parcel is more expensive than just buying one from the owner.” The other two areas made available in 2019 were Kantishna II and Redlands II, both in the Northern region of the state. The Kantishna II staking area is approximately 70 air miles west of Fairbanks and 30 river miles south of the confluence of the Kantishna and Tanana Rivers. There are still thirty-seven remaining authorizations for the staking area available. The Redlands II site is approximately 25 miles west of Manley Hot Springs and 110 miles west of Fairbanks, according to DNR’s 2019 brochure highlighting the program. Both areas up north are prime locations for hunting and fishing. There are twenty-five staking authorizations available in the area. Certain staking areas may be more attractive to Alaskans than others for a
multitude of reasons, like buildable soils, scenery, location to the road system, and trail systems in the area. “Usually, places that are closer to the road system, that makes them more popular,” Wholey says. Heidi Lean, another lifelong Alaskan, has plans to build her cabin on Cache Lake. Her father, Jerry Hartly, encouraged Lean and four of his other children to apply for the program, and Lean won while she was in college. Hartley took care of all the staking and planning in the beginning. “After dad staked the land, he paid the state quarterly for the surveying,” Lean says. “He thought he had staked 20 acres and the state came back with a 16.72(ish) acre parcel. But the money dad paid quarterly went to the final price of the land. At that point my dad called me and asked if I really wanted the Cache Lake land he staked when I was twentyone and living my best life as a junior in college. The state offered an extremely low interest rate for the program. We ended up owning 16-something acres of remote land in the Talkeetna Mountains for the price of a cell phone payment.” Lean says she and her husband have not started construction on their cabin yet, mostly due to logistics. “It is a float plane lake and the snow conditions have made it difficult to get out there for all six years we have owned the land,” Lean says.
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Lean is the mother of two young children, so there will be more opportunities to visit the property when her children are a bit older. “After owning the land for a year, [my husband] Andy and I flew out there for the weekend alone,” Lean says. “Both of us being Alaskan—and from opposite areas—it was incredible to set foot in a place that was unfamiliar to both of us and appreciate everything about the land we owned.” From 2001 to 2019, more than 50,462 acres have been available to stake and 3,143 staking authorizations have been made available, according to Wholey. Over the lifetime of the program 807 parcels have been sold, totaling 10,655 acres—meaning applicants have either entered a sale contract with the state or have received patent to their land. For 2019’s drawing (held November 5) 210 applications were received.
Getting Land to Alaskans Longacre says there are multiple ways the state sells land to the public. There is a Sealed-Bid Auction, comprised of parcels that have already been surveyed and appraised. The number of parcels that one bidder can win may be limited in each auction and, of course, the auction is only available to Alaska residents. “It’s important for folks to know that we are doing what we can to offer as much land as possible,” Longacre says. “We do have to, of course, look at the sustainability of our program.” In addition, there is the Over-theCounter (OTC) offering, which follows the Sealed-Bid Auction and includes parcels that did not sell in the auction. Non-Alaska residents can purchase OTC parcels, and there is no limit to the number of parcels that can be purchased. “The remote rec cabin staking program is slightly different because we don’t know where those parcel lines are until a customer stakes it themselves,” Longacre says. “They’re actually required to get the survey done and the appraisal completed and transfer their lease during that period—because that can take a couple of seasons, sometimes— and then it rolls over into a sale. “Our goal is to get as much land as possible into Alaska’s hand at the governor’s push—and we’re on board with it,” Longacre adds. www.akbizmag.com
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January 2020 | 65
TOURISM
66 | January 2020
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Backcountry Riding on a “Snow Pony” Snowmachines offer visitors a close-up view of the best of Alaska By McKibben Jackinsky
S
Northern Exposure Adventure Tours opens up Alaska's backcountry with tours created for beginning and experienced snowmachiners. Wayne Miller | Rogue Photography
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nowmachining is a truly exciting way to experience Alaska’s backcountry with its towering mountain peaks silhouetted against an immense expanse of sky; unmatchable shades of blue captured in glacial ice; and networks of trails winding through thick forests and over frozen lakes. There is a rewarding exhaustion that comes from many miles covered in a day filled with sights that can only be seen by snowmachine—one that Derek Ruckel and Amanda Clayton of Alaska Wild Guides of Girdwood know well. After years of guiding in Alaska, Ruckel recognized there was a need for multi-day backcountry snowmachine trips and founded Alaska Wild Guides tours in 2011. Clayton came on board in 2016 and developed the company’s online reservation system. Today 95 percent of the company’s business is booked online, with guests reserving spots for tours to Lake Louise, the Maclaren, Eureka, and Spencer Glaciers, portions of the Iditarod trail, and areas of Turnagain Pass. Lori Hibbs, concierge at Alyeska Resort in Girdwood, says in her fifteen years in the position she has seen continued interest in experiencing the state’s natural beauty while feeling the brisk air whipping by and seeing snow just inches away— especially for visitors who live in hot climates and for whom just seeing snow is captivating. “Snowmachine tours are very popular,” says Hibbs, who knows firsthand what a unique experience the tours offer. “I’ve been on them and they’re so scenic. There are all kinds of beautiful things to take pictures of.” Glacier City Snowmobile Tours is based at the Great Alaska Tourist Trap gift shop on the corner of the Seward and Alyeska Highways. This will be the twentieth season owners Chris Roberts and Connie Cooley have offered backcountry excursions on “snow ponies,” their nickname for snowmachines.
Alaska Business
January 2020 | 67
The Chugach Mountains give Black Ops Valdez clients miles of scenery and plenty of snow. Joshua Swierk
“We strive to take everybody, young or old. We can accommodate just about anyone,” says guide Justin Siemens; although guests must be over the age of sixteen to operate a snowmachine, younger travelers can ride with someone older. Glacier City Snowmobile Tours also provides a range of experiences, including the Real Deal tour, which takes clients to a “blue ice paradise” of glaciers, icebergs, and ice caves, and the Scenic Mountain tour, which transports guests deep into the Chugach Mountains. Jack Bonney is Visit Anchorage’s director of content and engagement, and he regularly directs interested parties to Glacier City Snowmobile Tours, Alaska Backcountry Adventure Tours, and Snowhook Adventure Guides. “It’s definitely an option we recommend when people are here,” says Bonney. “The primary driver still tends to be the Northern Lights and things more general to Alaska like wildlife, parklands, and glaciers. Those stay true regardless of the season. But in winter, we layer on what else visitors can do.” About 10 percent of Alaska visitation occurs in the winter, “but more tours are being offered in winter compared to ten years ago. It’s still an area of growth,” says Bonney. Alaska Backcountry Adventure Tours launched in 2000. Owners Dan and Matti Wilcock bought the business in 2015 and offer ATV tours in the summer and snowmachine tours that keep them busy four to five days a week throughout the winter. Most of their clients are out-of-state visitors, but they do “get the occasional Alaskans trying to decide if they want to ride 68 | January 2020
snowmachines or have only gone out a few times and want to know the area better,” says Matti Wilcock. Cottages at their Palmer location are perfect for close-to-home, multi-day excursions. The most popular tour they offer is a 60-mile all-day ride to Nelchina Glacier, complete with hot cocoa and snacks along the way and a hot meal at a lodge when the ride’s done. Snowhook Adventure Guides’ owner Justin Savidis of Willow is relatively new to the snowmachine tour business, but not to Alaska’s backcountry. “We started last year as a little experiment to see what kind of interest there was and it turned out to be pretty popular,” says Savidis. “We had clients from thirty-three countries. I think the furthest away was Mongolia.” Armed with a parks, recreation, and tourism degree from the University of Utah and the dream of running a dog team, Savidis, along with his wife Rebecca, came to Alaska in 2004. He’s competed in multiple races, including six times in the Iditarod, and has earned multiple awards for his time and the care he gives his dogs. “We have two types of snowmachine tours. One is a three-hour tour combining trail, a little powder, some trees and hills, a little bit of everything to capture all the riding abilities. And we’re starting to do overnights into the Yentna River area,” he says. “One more tour that’s gaining a lot of popularity is dog sledding in the morning and in the afternoon going on a snowmachine trip.” The experience of riding the historic Iditarod trail is made even more rich as Savidis shares stories from his experience. “I never have a lack of
things to say about wherever we are,” he says. Northern Exposure Adventure Tours, established in 2018, is a new tour operation looking forward to its second winter season. Owner Robert Rodamer has been riding snowmachines in the Wasilla and Trapper Creek areas since he was a youngster. As a student in University of Alaska Anchorage’s outdoor program, Rodamer completed an internship at Gate Creek Cabins in Trapper Creek. His graduation coincided with the lodge owner’s decision not to continue offering snowmachine tours, “So that’s where I started my business,” says Rodamer. In addition to client-designed tours, Rodamer offers a four-hour Cheechako tour geared toward beginners that takes advantage of the area’s maintained trails. The Boondocker tour allows experienced riders to travel off-trail onto untouched snow. Rodamer’s clients are typically Alaskans who want visiting friends and family to experience the state’s backcountry. He can comfortably guide groups of up to six and adds additional guides for larger parties. For riders who don’t want to operate their own machines, Rodamer has “two-ups” available, machines designed for an operator and a passenger. No matter the level of experience, before each tour Rodamer thoroughly goes over “every single control and function” of snowmachine operation. When it comes to braving outdoor temperatures, he leaves that decision to his clients. “I just make sure everyone in the group understands that as soon as it’s not fun
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anymore or they can’t get warm, we’ve got to come back,” Rodamer says. Casey Ressler at the Mat-Su Convention and Visitors Bureau enthusiastically promotes exploring Southcentral Alaska’s backcountry by snowmachine. “From the visitor perspective, you don’t have to be an experienced snowmachiner if you go with a guide. It's a chance for people who’ve never done it to enjoy it. From a resident perspective, if you think you want to get into snowmachining, spend time with a guide,” Ressler says. Chena Hot Springs Resort, sixty miles east of Fairbanks, includes single day snowmachine tours as part of a large list of available wintertime activities. “It is a 45-minute tour on flat country and mainly groomed trails, great for firsttimers,” says Javier Villasenor-Gaona, the resort’s director of advertising, marketing, and sales. Clients must be a minimum of sixteen years old, but no experience is required. Meanwhile, at the Valdez Convention and Visitors Bureau, Bernadette Irish points inquiries about snowmachine tours to Black Ops Valdez, owned and operated by Joshua and Tabatha Swierk. Originally from Maine, Joshua Swierk has a degree in recreation and tourism. The couple were looking for “the snowiest place on earth” when they came to Alaska sixteen years ago. They began Black Ops Valdez in 2005. Their tours and packages include ATV tours in the summer, overnights at Robe Lake Lodge, and snowboarding, heliskiing, and snowmachine tours in the winter. Their offerings attract twenty to thirty groups every winter. “I’ve done a lot of guiding for military guys that grew up out of state but are stationed in Alaska and don’t know anything about the area,” says Swierk. Some come with their own machines and just want to become familiar with new country, and Swierk is happy to provide a one- or two-day introduction to the area. The Swierks also host commercial filming companies wanting to capitalize on the surrounding scenery. Black Ops Valdez’s most popular tour is “anything that includes Thompson Pass. It’s a pretty vast, amazing place,” says Swierk. “Valdez is by far the best riding in the state. With the amount of snow we get, I’d dare say the world.” www.akbizmag.com
Alaska Business
January 2020 | 69
BUSINESS EVENTS JANUARY
keynote speaker Mike Bork. explorefairbanks.com
JANUARY 9-10
Arctic Ambitions Sheraton Anchorage Hotel: This is a premier business event hosted by World Trade Center Anchorage that focuses on trade, commerce, and investment in the Arctic. wtcanc.org JANUARY 9-11
Alaska Wholesale Gift Show Dena’ina Center, Anchorage: This event provides an opportunity for small business owners/ producers to grow their buyer base and meet face to face with other business owners, buyers, and managers. There are show specials on hotels, car rentals, travel concierges, etc. 10times.com/wholesale-alaskan-gift JANUARY 21-23
Alaska Health Summit Hotel Captain Cook, Anchorage: This is the annual conference of the Alaska Public Health Association; the 2019 theme is “Healthy Alaskans: For Science, For Action, For Equity.” alaskapublichealth.org JANUARY 21-23
Alaska Young Fishermen’s Summit Juneau: AYFS is designed to provide training, information, and networking opportunities for commercial fishermen early in their careers. alaskaseagrant.org JANUARY 22
Explore Fairbanks Interior Tourism Conference Westmark Fairbanks Hotel & Conference Center: This conference includes a day filled with educational seminars, networking, and lunch with 70 | January 2020
JANUARY 23
Junior Achievement of Alaska Awards Banquet Dena'ina Civic & Convention Center, Anchorage: Four new Alaskans will be inducted and recognized with this prestigious award. Attended by more than four hundred business representations, the program consists of a networking reception, dinner, and awards ceremony. juniorachievement.org JANUARY 24-26
Alaska RTI/MTSS Effective Instruction Conference
and students from Alaska, the Pacific Northwest, and beyond join together to communicate research activities in the marine regions off Alaska. alaskamarinescience.org
Alaska Chapter of The Wildlife Society and brings together wildlife researchers, managers, educators, students, and administrators. twsalaskameeting.com
FEBRUARY
FEBRUARY 17-19
FEBRUARY 6-8
Anchorage AEYC Early Childhood Conference Hilton Anchorage Hotel: “One, Two, Buckle My Shoe… Three, Four, Let’s Explore!” Join other early childhood community members to learn new strategies, hear about the latest research, try out a few practical techniques, and discover new tools and resources. anchorageaeyc.org
Dena’ina Center, Anchorage: The mission of the Alaska Staff Development Network is to improve student achievement by providing researched-based online learning and face-toface professional development programs for Alaska’s teachers and school administrators. asdn.org/2020-alaska-rti-mtsseffective-instruction-conference/
FEBRUARY 7-9
JANUARY 25
FEBRUARY 10-14
Alaska Treatment Free Beekeeping Symposium
Alaska Forum on the Environment
Glenn Massay Theater, Palmer: The symposium is intended to benefit—and is open to—all apiarians/beekeepers regardless of experience or affiliation. Sharing ideas and methods can benefit all apiarians/beekeepers in their endeavors to becoming better, more successful beekeepers. alaskabeeclub.com
Alaska Pharmacists Association Convention & Tradeshow Sheraton Anchorage: The Alaska Pharmacists Association is a 501(c)(6) nonprofit organization serving pharmacists, technicians, associates, and students. alaskapharmacy.org
Dena’ina Center, Anchorage: The Alaska Forum on the Environment is Alaska's largest statewide gathering of environmental professionals from government agencies, nonprofit and for-profit businesses, community leaders, Alaskan youth, conservationists, biologists, and community elders. akforum.com FEBRUARY 10-14
JANUARY 27-31
Alaska Marine Science Symposium Hotel Captain Cook, Egan Center: Scientists, researchers,
TWS Alaska Chapter Annual Meeting Atwood Center Rasmuson Hall, APU, Anchorage: This is the annual meeting of the
Alaska Statewide Special Education Conference Hilton Anchorage: The Alaska Statewide Special Education Conference (ASSEC) is committed to providing high quality professional development relevant to the cultural, rural, and remote characteristics of Alaska. assec.org FEBRUARY 18-20
AML Winter Legislative Meeting Juneau: The Alaska Municipal League is a voluntary, nonprofit, nonpartisan, statewide organization of 162 cities, boroughs, and unified municipalities that represent more than 97 percent of Alaska’s residents. akml.org FEBRUARY 22-25
ASTE Annual Conference Hotel Captain Cook, Anchorage: This is the educational technology conference of the Alaska Society for Technology in Education. This year’s keynote speakers are Kristen Mattson and Jon Landis. aste.org FEBRUARY 26-29
Annual Meeting of the Alaska Anthropological Association Westmark Hotel, Fairbanks: The annual meeting includes workshops, an evening reception for information and registration, paper presentations, an awards banquet, and keynote speakers. alaskaanthropology.org
Alaska Business www.akbizmag.com
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COMMUNITY EVENTS JANUARY 2-11
sleuthing skills to solve the case, clear his name, and win back the girl. In The Pawnshop, Charlie Chaplin plays an assistant in a pawnshop where he goes about his job in his usual comic manner. When a customer brings in an alarm clock to be pawned, Chaplin engages in one of his most famous solo sustained comedy bits. anchoragesymphony.org
Holiday Lights in the Garden The Alaska Botanical Garden fills the grounds with beautiful light displays, live music, model train displays, vendors, warm drinks, and bonfires. This year the organization’s goal is to produce zero trash during the event, so guests are asked to bring their own mugs to fill with coffee, tea, chocolate, or cider. alaskabg.org
ANCHORAGE
JANUARY 15-26
JANUARY 1-31
JANUARY 11
Zoo Lights
Silent Film Night: Keaton and Chaplin
On Thursday through Sunday from 6:30 p.m. to 8:30 p.m., head to the Alaska Zoo to visit the big, bright, beautiful lighted parade of animals. From front to back, the zoo is decorated with colorful, whimsical, and even animated lighted animal displays. alaskazoo.org
Anchorage Folk Festival The Anchorage Folk Festival’s goal is to support, encourage, and promote music and dance through performance and education. Across town artists take to the stage in free
It’s an evening of Silent Film giants: In Sherlock Jr., when his fiancée is robbed, a kindly movie projectionist (Buster Keaton) is framed but uses his amateur
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concerts, and the festival also includes workshops, contests, classes, and dances. anchoragefolkfestival.org JANUARY 18
Tri-Flake Winter Triathlon The Tri-Flake is Alaska’s only USA Triathlon-sanctioned winter triathlon. It starts with an 8K run on the Coastal Trail, followed by an 8-mile bike on multi-use trails and STA single track trails in Kincaid, and finishes with a 10K ski on Kincaid's ski trails. alaskatriathlon.org
CORDOVA JANUARY 25- FEBRUARY 1
Cordova Iceworm Festival The Cordova Iceworm Festival was created in 1961 by a few great Cordovans who were itching to lift the spirits of those down with the winter blues. Festivities
include crowning Miss Iceworm, naming the Citizen of the Year, the only fireworks show in Cordova, survival suit races, parade, annual adult basketball and volleyball competitions, historical displays, a variety show, a paper airplane competition, and amazing local eats all week long. icewormfestival.com
FAIRBANKS JANUARY 17-19
Kid Fest Shake off the winter blues by checking out Kid Fest, a three-day event packed with kid-friendly fun. Kids and parents alike will enjoy exciting games, inflatables, laser tag, mini golf, and great food at the Carlson Center. kidfestak.org JANUARY 25
Winter Animal Track Walk Enjoy a guided walk on the refuge trail at Creamer's Field to find tracks
and learn about Interior Alaska's winter animals. friendsofcreamersfield.org
JUNEAU JANUARY 24-26
Platypus-Con The community comes together to play new and old board and card games. Demonstrations, organized games, miniature painting, and a huge lending library for open tables will be provided at Centennial Hall. platypusgaming.org
this, he immediately reports to his associates. When his brother, the mayor, conspires with local politicians and the newspaper to suppress the story, Stockmann appeals to the public—only to be shouted down and reviled as “an enemy of the people.” This is American playwright Arthur Miller’s provocative and surprisingly timely adaptation of Norwegian dramatist Henrik Ibsen’s incendiary drama. valleyperformingarts.org
WILLOW JANUARY 24-26
Willow Winter Carnival
WASILLA JANUARY 10-26
An Enemy of the People A small Norwegian town has just begun to win fame and wealth through its medicinal spring waters. Dr. Stockmann, resident physician in charge, discovers that the waters are poisoned. On receiving proof of
The carnival boasts one of the state’s biggest winter fireworks shows, Iditarod qualifying sled dog races, homesteading competitions, $1,000 bingo cash pots, talent contests, foot and ski races, entertainment, kids games, a cribbage tournament, and food. alaskavisit.com
AVISALASKA.COM/VIP
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Alaska Business
January 2020 | 73
INSIDE ALASKA BUSINESS A five-year, $1 million grant from the US Department of Education will support a new University of Alaska Fairbanks program to teach students how to operate in the booming markets of YouTube, video game streaming, and social media. The new, sixteen-credit occupational endorsement in content creation has been submitted for academic review and is expected to be available this fall if approved. The university also received a five-year, $16 million grant to expand UAF’s Biomedical Learning and Student Training program, which engages students in biomedical research. uaf.edu
RurAL CAP The Native Village of Hooper Bay and Rural Alaska Community Action Program (RurAL CAP) are opening a women’s domestic violence shelter in the Hooper Bay sub-region. The Hooper Bay Victim Services Project will provide comprehensive victim services and support for women and their children who have experienced domestic violence and/or sexual assault in Hooper Bay and the surrounding sub-region including Chevak and Scammon Bay. Renovation of the building, a space provided by Sea Lion Corporation, began in September. Once completed, the shelter will be staffed 24/7. ruralcap.com
Port of Alaska The US Department of Transportation awarded a $25 million Better Utilizing Investment to Leverage Development (BUILD) Grant to the Port of Alaska. The Municipality of Anchorage (MOA) will use the funding to complete a new petroleum and cement terminal. MOA broke ground on the $214 million terminal in summer 2019. The BUILD grant will make a significant dent in the project’s then-$80 million gap in funding, as construction began with $134 million in state and federal 74 | January 2020
dollars on hand. Alaska’s Congressional Delegation applauded the grant, saying, “This new BUILD Grant will help offset the cost of the first phase of the port’s desperately-needed modernization program.” portofalaska.com
Pacific Health Coalition Pacific Health Coalition Executive Director Fred Brown was elected president of the National Labor Alliance of Health Care Coalitions, a nonprofit organization of management health and welfare coalitions representing purchasers of health services that work together to increase value in care, services, and benefits for more than 6.5 million Americans. Brown’s goal is to provide efficient and innovative plan options already implemented in Alaska as options for other organizations to improve quality and cost of care nationwide, in addition to strengthening communication and strategic engagement. phcoalition.org | nlahcc.org
anyone from crossing until the bears moved. The new elevated bridge and walkway alleviate this congestion; allow wildlife to move freely down the river and under the new bridge; give visitors an improved vantage point from above; lessen delays; and improve safety for both visitors and wildlife. stgincorporated.com
LifeMed Alaska LifeMed Alaska is maintaining its accreditation with the Commission on Accreditation of Medical Transport Systems, or CAMTS. The announcement comes after site inspections, thorough evaluation of LifeMed programs, and public comment. A CAMTSaccredited medical transport service demonstrates to its employees and to the public that it cares about the quality of patient care and safety and is committed to doing things right. The accreditation is a voluntary, peer reviewed process. lifemedalaska.com
NANA STG Incorporated
UAF
STG Incorporated STG Incorporated completed the construction of a new bridge and walkway over the Brooks River in Katmai National Park and Preserve for the National Park Service. The project was commissioned to replace a floating bridge across the Brooks River, a centerpiece feature of the park, where the spawning Bristol Bay Sockeye Salmon make their way back up to the headwaters as the bears congregate in high concentrations to fish. Due to the high concentration of bears in this area, visitors and park employees would frequently experience long delays on the floating bridge due to “bear jams” when bears would be near or on the bridge preventing
NANA shareholders voted to establish a shareholder trust; moving forward, instead of dividends being distributed by NANA directly, they will be distributed through the new trust, which means they will be tax-exempt. NANA can contribute to the trust as a pre-tax investment, and the trust itself will be taxed at a lower rate, saving costs for the corporation and its shareholders. nana.com
Ahtna Ahtna subsidiary Ahtna Marine & Construction Company finalized its acquisition of Cavache, a Floridabased dredging and civil construction firm. Cavache specializes in hydraulic and mechanical dredging services in lakes, ports, rivers, canals, inlets, and other navigable waterways, as well as beach renourishment, shoreline protection, wetland construction, and environmental clean-up and maintenance. ahtna.net
Alaska Business www.akbizmag.com
RIGHT MOVES BDO USA BDO USA promoted James Doughty and Jake Kolipano to Assurance Partners. Previously, Doughty and Kolipano served as directors and have both been with Doughty the Anchorage office for more than thirteen years. Earlier this year, Joy Merriner was named Assurance Office Managing Partner. Merriner previously served as assurance partner and has been with the Anchorage Merriner office for seventeen years. Doughty, Kolipano, and Merriner join Kevin Van Nortwick, tax office managing partner; Bikky Shrestha, assurance partner; and Chad Estes, tax partner in leading more than Kolipano eighty professionals locally. Collectively, the group has more than ninety years of experience serving Alaska businesses and the community.
Northrim Bank Northrim Bank hired Jonathan Tibbs as VP, Commercial Loan Officer–Fairbanks and promoted Jason Gentry to VP, Lending Branch Manager–Ketchikan. Tibbs joins Northrim with more than fourteen years of experience in lending in Alaska. He holds a bachelor’s degree in business administration with an emphasis in finance from Brigham Young University. A lifelong Alaskan, Tibbs is originally from North Pole and remains involved in the Tibbs
Fairbanks community. Gentry has been with Northrim Bank for one year and has more than seven years of experience in the finance industry. A lifelong Alaskan, he grew up in Utqiaġvik and attended the University of Alaska Fairbanks. Gentry and his family have made Gentry Ketchikan their home for the past nine years and he volunteers his spare time within the Ketchikan youth athletic community.
Tlingit & Haida Central Council of Tlingit and Haida Indian Tribes of Alaska hired Jamie Shanley as Child Care Administrator for the Tribe’s new Little Eagles and Ravens Nest (LEARN) Child Care Center. She earned a bachelor’s degree in early childhood/ Shanley elementary education with a double minor in dance and history from Western Oregon University and master’s degree in early childhood development from Pacific Oaks College in California.
Theatre Project for the sustainability of theatres and artists of color; co-facilitator of the launch of the Theatre Ishii Communication Group’s Equity, Diversity and Inclusion Institute; and core faculty for artEquity.
R&M Consultants Russell Gingras, EIT, recently joined R&M Consultants as a Staff Engineer in the firm’s utilities group. Gingras will assist with planning and design of civil engineering projects, with an emphasis in utility Gingras design. Gingras brings two years of civil engineering experience to R&M, with experience in both public and private utility sectors including construction site inspections, utility conflict review, utility waivers and permitting, feasibility reviews, agency coordination for review, and inspection of wastewater projects. Gingras has a bachelor’s degree in civil engineering from the University of Alaska Anchorage.
Alaska USA Federal Credit Union
Perseverance Theatre Perseverance Theatre hired Leslie Ishii as its Artistic Director. Her years of organizational experience include serving as co-chair, organizer, and board member for the Consortium of Asian American Theaters and Artists’ fifth and sixth national ConFest; founder and co-director for the National Cultural Navigation
Alaska USA Federal Credit Union has selected three new executives. Michelle Bradshaw has been selected to fill the Senior Vice President of IM Governance position. Bradshaw is an accomplished, seniorlevel leader with more Bradshaw
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76 | January 2020
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than twenty years of experience in technology and project management. She previously held the position of vice president, IM applications. Laura Moore has been selected to fill the position of Vice President, IM applications. Moore has more than twenty years of experience in technology transformation and automation prior to joining Alaska USA as the Moore applications group manager. Victoria Worley has been selected to fill the position of Vice President, Operations. Worley joins Alaska USA with more than fifteen years of Alaska financial institution Worley experience and will oversee credit union operational functions.
PND Engineers PND Engineers announced the following new hires. Don Brown has joined PND’s CAD group in Anchorage. Brown earned a bachelor’s degree in science and technology from the University of Alaska Anchorage, an associate’s in electronics technology from the Community College of the Air Force, and an associate’s Brown in computer science from Charter College. He retired from the Air Force, where he served as a satellite communications technician and was deployed to Riyadh, Saudi Arabia, during Operation Desert Storm. He has since worked as a telecommunications worker, computer assistant, electronics mechanic, network technician, AutoCad specialist, engineering technician, and adjunct professor teaching Autodesk, Microsoft Office, math, and safety classes.
Lifelong Alaskan and University of Alaska Fairbanks graduate Levi Overbeck, PE, has joined PND’s Anchorage civil staff. Overbeck holds bachelor’s and master’s degrees in civil engineering from the University of Alaska Fairbanks. He spent three years at Jacobs Engineering in environmental Overbeck and drainage design and modeling. One of his first assignments at PND is to bring his Bentley MicroStation experience to bear on Alaska DOT&PF and Federal Highway Administration projects. Overbeck’s educational emphasis was in Arctic water resources and hydrology; he spent two summers conducting hydrology studies at remote North Slope sites. Sarah Boeckman has joined PND’s Anchorage accounting staff. As a Project Accountant, she assists with project setup and reporting, billing and project closeouts, and other accounting functions as needed. Boeckman is a lifelong Alaskan and graduate Boeckman of the University of Alaska Anchorage with a bachelor of business administration degree in accounting. She previously worked for Bristol Bay Industrial where she supervised project accounting and billing for Peak Oilfield Services.
Alaska Communications Alaska Communications named Laurie Butcher Chief Financial Officer. Butcher, who joined Alaska Communications in 1997, has served as senior vice president of finance since October 2015 and principal financial and accounting officer since November 2015. In addition to the Free Cash Flow growth and EBITDA margin Butcher
expansion strategies, she leads SEC reporting, SOX compliance, accounting, budgeting, forecasting, and more. Butcher holds a bachelor’s degree in accounting from the University of Alaska and is a licensed CPA.
Alaska Native Heritage Center The Alaska Native Heritage Center has hired Emily “Keneggnarkayaaggaq” Edenshaw as Executive Director. As the ANHC executive director, Edenshaw provides sound organizational management and visionary leadership to ensure sustainable ANHC success. Edenshaw is a Edenshaw second year PhD indigenous studies student at the University of Alaska Fairbanks. She also holds an executive master of business administration degree in strategic leadership from Alaska Pacific University and a bachelor’s degree in journalism and public communications from the University of Alaska Anchorage.
Coffman Engineers Coffman Engineers promoted Rob Wasserman to Department Manager for the new Anchorage Project Management group. Wasserman is a licensed civil and structural engineer with nearly thirteen years of experience. Over the past two years with Coffman, Wasserman has been actively involved in business development, project management, project engineering, client management, and structural design. In his new role Wasserman is responsible for mentoring and providing leadership to the project management group. Wasserman
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Alaska Business
January 2020 | 77
ALASKA TRENDS BROADBAND INTERNET IN ALASKA No broadband service 25+ MBPS broadband 25+ MBPS, 100 MBPS & 1 Gig broadband
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ANS Crude Oil Production
92%
of Alaskans have access to wireline service
12/03/2019
01/01/2014 05/01/2011 09/01/2008
BUT 258,000 people in Alaska have access to ONLY ONE wired provider, leaving them no options to switch.
01/01/2006
ANS Production barrel per day 522,649 Dec. 3, 2019
05/01/2003 09/01/2000
0
400,000
800,000
1,200,000
SOURCE: Alaska Department of Revenue Tax Division
ANS West Coast Crude Oil Prices 12/03/2019
09/01/2012
09/01/2008
ANS West Coast $ per barrel $63.85 Dec.3, 2019
09/01/2004
Since 2010, Connect Alaska has been awarded $6,378,198 in federal grants for Alaska's Broadband Initiative.
09/01/2000 $0
$20
$40
$60
$80 $100 $120 $140 $160
SOURCE: Alaska Department of Revenue Tax Division
Statewide Employment Figures 01/1976-10/2019 Seasonally Adjusted
6%
of Alaskans have access to FIBER OPTIC service
69.2%
79.3% of Alaskans have access to CABLE service
10/01/2019
Labor Force 349,051 Oct. 2019 Employment 327,555 Oct. 2019 Unemployment 6.2% Oct. 2019
01/01/2010 05/01/2004 09/01/1998 01/01/1993 05/01/1987
of Alaskans have access to DSL service
09/01/1981 01/01/1976 0
SOURCE: Broadbandnow.com/Alaska
100,000
200,000
300,000
400,000
SOURCE: Alaska Department of Labor and Workforce Development, Research & Analysis Section
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www.penco.org January 2020 | 79
AT A GLANCE What book is currently on your nightstand? Legacy by James Kerr—What the All Blacks can teach us about the business of life. What movie do you recommend to everyone you know? To be honest, I don’t watch a lot of movies. I watch hockey and news [he laughs]. But a recent movie that I did watch was Free Solo; it’s a huge adrenaline rush. What’s the first thing you do when you get home after a long day at work? I visit with my beautiful wife, Nancy, and then after that I usually get a little exercise before dinner. If you couldn’t live in Alaska, what’s your dream locale? Somewhere that had a lot of mountains and is sunny, so Colorado or Idaho, but honestly I really love living in Alaska.
Images ©Kerry Tasker
If you could domesticate a wild animal, what animal would it be? It would be a bald eagle. I have fond memories of canoeing and rafting and lots of rivers in Alaska, and I really admire the grace and the beauty and the strength of those birds.
80 | January 2020
Alaska Business www.akbizmag.com
OFF THE CUFF
Joe Schierhorn J
oe Schierhorn is the chairman, president, and CEO of Northrim Bank. He stepped into the
role of president and CEO in June 2017 after a long career at Northrim that started in 1990 when he was hired as vice president, commercial loan officer, and regulatory compliance manager. “One of the things that attracted me to the finance industry was the ability to deal with people,” Schierhorn says, which is his favorite part of his daily work. “As the bank has grown, so many of our customers too have grown… [and I’ve] developed strong personal relationships with a number of customers over almost a thirty-year time period. I really like developing long-term relationships.” Alaska Business: What do you do in your free time? Joe Schierhorn: I hike a lot with my beautiful wife and our dog in the mountains around Anchorage and cross-country ski when we have snow… [We] travel a lot—all three of our boys live outside of the state right now.
AB: What’s your favorite way to exercise? Schierhorn: Hiking and skiing, working out, and walking with the dog. AB: Dead or alive, who would you like to see perform live in concert? Schierhorn: Kenny G. AB: What’s your greatest extravagance? Schierhorn: Probably all the flying that we do to visit our kids… We do spend a lot of time traveling now that the kids are spread throughout the United States and Europe. AB: What’s your best attribute and worst attribute? Schierhorn: I’m really good at dealing with people both in the business and outside the bank. I'm very comfortable talking with new people and engaging them, whether they're customers at the bank or just people that we meet in our various travels. As far as a weakness, I think I can be impatient. So I’m constantly following up with people here at the bank and my wife would say I’m somewhat impatient with our kids sometimes.
AB: Is there a skill you’re currently developing or have always wanted to learn? Schierhorn: I take a lot of pictures… it’s a passion of mine, generally of family and friends and so forth. If I was to have the time I’d like to learn how to take photos better. AB: What’s the most daring thing you’ve ever done? Schierhorn: Probably whitewater kayak down the Nenana River after kayaking for oh, probably a month. It went okay [he laughs]. AB: What’s your go-to comfort food? Schierhorn: Lemon chicken and risotto. My wife makes it best. AB: Other than your current career, if you were a kid today, what would your dream job be? Schierhorn: I’ve had a lot of fantastic experiences flying in and around Alaska, and I would say being a pilot. www.akbizmag.com
Alaska Business
January 2020 | 81
ADVERTISERS INDEX Alaska Executive Search...................................................... 33
Leonardo DRS...................................................................... 15
akexec.com
LeonardoDRS.com
Alaska Native Tribal Health Consortium..............................84
Lynden Inc...........................................................................83
anthc.org
lynden.com
Alaska Pacific University...................................................... 37
Microcom.............................................................................65
alaskapacific.edu
microcom.tv
Alaska PTAC......................................................................... 21
NCB......................................................................................69
ptacalaska.org
ncb.coop
Alaska Safety Alliance..........................................................60
New Horizons Telecom, Inc................................................ 19
alaskasafetyalliance.org
nhtiusa.com
All American Oifield Services..............................................59
Northern Air Cargo.........................................................76,77
allamericanoilfield.com
nac.aero
Altman Rogers & Co............................................................49
NRC Alaska........................................................................... 61
altrogco.com
nrcc.com
American Heart Association................................................ 35
Oxford Assaying & Refining Inc........................................... 55
www.heart.org
oxfordmetal.com
American Marine / Penco...............................................78,79
Pacific Pile & Marine............................................................ 75
amarinecorp.com
pacificpile.com
Arctic Information Technology............................................. 3
Parker Smith & Feek.............................................................45
arcticit.com
psfinc.com
Avis Rent-A-Car................................................................... 73
Port of Alaska.......................................................................23
avisalaska.com
portofalaska.com
BP........................................................................................... 9
Risq Consulting.................................................................... 31
bp.com
risqconsulting.com
Carlile Transportation Systems............................................ 71
Seatac Marine Service..........................................................65
carlile.biz
seatacmarine.com
Central Environmental Inc................................................... 25 cei-alaska.com
Span Alaska Transportation LLC.......................................... 13 spanalaska.com
CN Aquatrain........................................................................ 57 Conrad-Houston Insurance Agency...................................49 chialaska.com
Stellar Designs Inc............................................................... 72 stellar-designs.com
T Rowe Price........................................................................ 27
Construction Machinery Industrial....................................... 2
uacollegesavings.com
cmiak.com
First National Bank Alaska...................................................... 5
The Odom Corporation.......................................................39 odomcorp.com
fnbalaska.com
Fountainhead Hotels...........................................................38 fdialaska.com
GCI....................................................................................... 17 gci.com
Island Air Express................................................................. 72 islandairx.com
Jim Meinel, CPA PC............................................................. 21
UA Local 375 Plumbers & Pipefitters................................... 11 ualocal375.org
United States Census Bureau.............................................. 51 https://www.census.gov/
University of Washington Foster School of Business..........29 foster.uw.edu
Westmark Hotels - HAP Alaska............................................69
meinelcpa.com
westmarkhotels.com
Junior Achievement............................................................34
Wilson Albers....................................................................... 47
juniorachievement.org/web/ja-alaska/
wilsonalbers.com
82 | January 2020
Alaska Business www.akbizmag.com
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SPECIALTY CARE AT ALASKA NATIVE MEDICAL CENTER
Allergy and Immunology • Cardiology • Colorectal Cancer Screening • Dermatology • Ear, Nose and Throat Emergency Medicine • Endocrinology • Diabetes • Gastroenterology • General Medicine • General Surgery • GYNOncology • Hematology • Hepatology/Liver • HIV/Early Intervention Services • Infectious Disease • Infusion Therapy Maternal Fetal Medicine • Nephrology • Neurology • Neurosurgery • Oncology • Ophthalmology • Orthopedic Services • Pain Management • Palliative Care • Pediatric Endocrinology • Pediatric Neurodevelopment • Pediatric Surgery • Pediatric Urology • Podiatry • Pulmonology • Rheumatology • Sleep Medicine • Urology • Walk-in Clinic
36 Specialty Care Services at ANMC: Providing the highest quality health services Alaska Native people in our state have access to the most comprehensive medical care in the Tribal health system. Specialty care at the Alaska Native Medical Center has continuously grown with new clinics, new patient housing, new doctors and new services. ANTHC investment in Alaska Native people advances our vision that Alaska Native people are the healthiest people in the world. Learn about our newest specialty clinic, Allergy and Immunology, at anthc.org/allergy.
