Alaska Business Monthly September 2016 by Alaska Business

CONSTRUCTION | TRANSPORTATION | ENERGY | ALASKA LNG | MANAGEMENT

September 2016

Digital Edition ALASKA NATIVE BUSINESS SPECIAL SECTION

Michelle Anderson and Ahtna

Focusing in on Alaska

TRUST ESCO AND CONSTRUCTION MACHINERY INDUSTRIAL FOR PREMIUM PARTS AND SERVICE Ultralok® Tooth System

ESCO Crusher W Wear Parts

ESCO Blade Products

www.cmiak.com CONTACT THE BRANCH NEAREST YOU FOR ALL YOUR EQUIPMENT NEEDS FAIRBANKS Clayton Dunn P: 907-455-9600 F: 907-455-9700

ANCHORAGE Mike Miller P: 907-563-3822 F: 907-563-1381

JUNEAU P: 907-780-4030 F: 907-780-4800

KETCHIKAN P: 907-247-2228 F: 907-247-2229

INCREASED PRODUCTIVITY. REDUCED MAINTENANCE. GREATER SITE SAFETY. ESCO and Construction Machinery Industrial offers a comprehensive package of wear parts for the construction and aggregate markets. CMI’s factory trained staff provides application expertise to optimize performance.

escocorp.com

September 2016 Digital Edition TA BLE OF CONTENTS

DEPARTMENTS

ABOUT THE COVER: Ahtna, Incorporated President Michelle Anderson manages the Alaska Native regional corporation in its commitment to maintain its defining culture while moving forward—the Athabascan leader and Ahtna are focusing in on Alaska (begins page 26). That story is part of Alaska Business Monthly’s annual Alaska Native Business special section (beings on page 12).

FROM THE EDITOR 7 ACCOLADES 112 RIGHT MOVES 114 INSIDE ALASKA BUSINESS 116 EAT, SHOP, PLAY, STAY 119 EVENTS CALENDAR 120 BUSINESS EVENTS 122 ALASKA TRENDS 123 ADVERTISERS INDEX 126

Cover Photo: © Judy Patrick Photography Cover Design: David Geiger, Art Director

Alaska Native Business Special Section Growth and diversity drive economic engine By Julie Stricker

12 © Chris Arend chrisarendphoto.com / Courtesy of ASRC

12 | Alaska Native Regional Corporations Overview

20 | Alaska Native Village Corporation Review

Partnerships and diversification drive growth By Tasha Anderson

26 | Ahtna and Michelle Anderson One Team, One Ahtna focusing in on Alaska By Tasha Anderson

30 | ANSEP Success

Graduates engage, motivate, and teach By Rindi White

36 | Revisiting ANCSA: Mike Gravel

Former Alaskan statesman reminisces By Shehla Anjum

Arctic Slope Regional Corporation shareholders at the annual meeting in Kaktovik.

42 | 2016 Alaska Native Regional Corporations Directory

44 | 2016 Alaska Native Village Corporations Listings

ARTICLES The long hallway at Northwest Strategies offices in Anchorage.

ALASKAN SOURDOUGH

8 | Hazel Englund Celebrates 100 Years in Haines By Mikki Chandler

FINANCIAL SERVICES

48 | Merger and Acquisition Funding Facilitates Business Transitions in Alaska Alaska Native corporations, private equity groups, professional firms, and baby boomers fuel transactions By Tracy Barbour

CONSULTANT’S CORNER

54 | Creating a Transferable Business (Part 3) When you exit, who will do your job? By Mel B. Bannon

Photo courtesy of Ash Adams

48 ENERGY

56 | Transitional Leadership at Chugach Electric Association ‘Seamless’ change between Evans and Thibert By Rindi White

MANAGEMENT

62 | On Leadership By Dr. Jim Johnsen

64 | Executive Recruitment Put your best foot forward in attracting executive-level talent By Jillian Caswell

Alaska Business Monthly | September 2016 www.akbizmag.com

S e pte m b e r 2 016 Digit a l Edition TAB LE OF CONTENTS

ARTICLES START-UPS

66 | Jennifer Dushane’s Arctic Horse Gear

All-weather skirts for women who ride horses, or don’t By Rindi White

OIL & GAS

70 | Project Icewine and 88 Energy Limited Exploring on the North Slope—one step at a time By Tom Anderson

72 | Resources Energy, Inc. Spearheads LNG Development Company looks for investors for innovative Southcentral project By Julie Stricker

74 | Alaska LNG Provides More Details on Project Construction

VOLUME 32, NUMBER 9 Published by Alaska Business Publishing Co. Anchorage, Alaska

EDITORIAL STAFF

Managing Editor Susan Harrington 257-2907 editor@akbizmag.com Associate Editor Tasha Anderson 257-2902 tanderson@akbizmag.com Art Director David Geiger 257-2916 design@akbizmag.com Art Production Linda Shogren 257-2912 production@akbizmag.com Photo Contributor Judy Patrick

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 Mgr. Bill Morris 257-2911 b_morris@akbizmag.com Account Mgr. Janis J. Plume 257-2917 janis@akbizmag.com Account Mgr. Holly Parsons 257-2910 hparsons@akbizmag.com Accountant Ana Lavagnino 257-2901 accounts@akbizmag.com Customer Service Representative Emily Olsen 257-2914 emily@akbizmag.com

By Larry Persily

TELECOM & TECHNOLOGY

84 | Expanding Technology in the Arctic Rural residents benefit from continued build out By Julie Stricker

TRANSPORTATION

86 | Heavy Haul Freight Oversize, overweight loads By Tasha Anderson

ENERGY

92 | Winter Energy in Rural Alaska Upterrlainarluta ‘Always getting ready’ By Julie Stricker

Building Alaska Special Section 96 | Transportation Infrastructure Alaska Airlines invests in Alaska By Tasha Anderson

98 | Solar Gains: Arctic Solar Ventures Aims to Power Alaska with the Sun

501 W. Northern Lights Boulevard, Suite 100 Anchorage, Alaska 99503-2577 (907) 276-4373 | Outside Anchorage: 1-800-770-4373 Fax: (907) 279-2900 www.akbizmag.com | Editorial email: editor@akbizmag.com

ALASKA BUSINESS PUBLISHING CO., INC.

ALASKA BUSINESS MONTHLY (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; Fax: (907) 279-2900, ©2016, Alaska Business Publishing Co. All rights reserved. Subscription Rates: $39.95 a year. Single issues of the Power List are $15 each. Single issues of Alaska Business Monthly are $3.95 each; $4.95 for October, and back issues are $5 each. Send subscription orders and address changes to the Circulation Department, Alaska Business Monthly, PO Box 241288, Anchorage, AK 99524. Please supply both old and new addresses and allow six weeks for change, or update online at www.akbizmag.com. Manuscripts: Email query letter to editor@akbizmag.com. Alaska Business Monthly is not responsible for unsolicited materials. Photocopies: Where necessary, permission is granted by the copyright owner for libraries and others registered with Copyright Clearance Center to photocopy any article herein for $1.35 per copy. Send payments to CCC, 27 Congress Street, Salem, MA 01970. Copying done for other than personal or internal reference use without the expressed permission of Alaska Business Publishing Co., Inc. is prohibited. Email specific requests to editor@akbizmag.com. Online: Alaska Business Monthly is available at www.akbizmag.com/Digital-Archives, www.thefreelibrary.com/ Alaska+Business+Monthly-p2643 and from Thomson Gale. Microfilm: Alaska Business Monthly is available on microfilm from University Microfilms International, 300 North Zeeb Rd., Ann Arbor, MI 48106.

facebook.com/AKBusinessMonth

By Susan Harrington

100 | ABM’s Fall 2016 Construction Roundup Compiled by Susan Harrington

twitter.com/AKBusinessMonth

Alaska Business Monthly | September 2016 www.akbizmag.com

FROM THE EDITOR

Alaska Native Corporations

Michelle Anderson President

Ahtna, Inc.

Anthony Mallott President & CEO Sealaska

Wayne Westlake President & CEO NANA Regional Corporation

Elizabeth Perry CEO

Koniag, Inc.

Big boost to Alaska economy

Matt Fagnani CEO

Aleut Corporation

laska Native Corporations formed under the Alaska Native Claims Settlement Act (ANCSA) contribute a vast amount and diverse array of economic stability to the state’s $50 billion-plus GDP. The majority of this is accomplished by the twelve regional corporations, of which we’ve provided an overview and a directory as part of this month’s annual Alaska Native Business special section. Aggregated reported 2015 gross revenue for the twelve regional corporations is $8.5 billion, down about $100 million from 2014. Companies reported 119,223 shareholders and 45,489 worldwide employees, with 14,563 in Alaska. Those numbers are expected to grow in 2016 with expanded operations and acquisitions of more subsidiaries. Last year’s Alaska Business Monthly Top 49ers, featured in October, included twenty ANSCA corporations, which included eight village corporations in addition to the twelve regional corporations. Overall 2014 gross revenues for these companies topped $11 billion—74 percent of all Top 49ers gross revenue. Tune in next month for what we promise will be another amazing display of dominance by Alaska Native Corporations in the Top 49ers. The success of Alaska Native companies is due in part to a host of multi-faceted factors including exceptional leadership, evolving business models, shareholder-focused missions, and continuous diversification. ANCSA Regional Association reported in its latest economic impact report that 2014 net profits for the twelve regional corporations “amounted to nearly $305 million, up 98 percent from $154 million the previous year.” The Association also noted that all ANCSA regional and village corporations (except the 13th Regional Corporation) are based in Alaska along with most administrative and management functions. “This means that all profits are returned to the Alaska economy … the net result being that Alaska Native Corporations effectively import profits to Alaska … reversing Alaska’s historical economic model.” Native businesses are featured prominently this month and not just in the special section— Alaska Native people and companies are found in every sector of the Alaska economy and throughout the September issue of Alaska Business Monthly. The team at Alaska Business Monthly has put together another really great issue—enjoy! And wish Hazel a happy 100th!

Susan Harrington, Managing Editor

Aaron Schutt

Rex A. Rock Sr. President & CEO

Arctic Slope Regional Corporation

Gail R. Schubert President & CEO

Bering Straits Native Corporation

Jason Metrokin

President & CEO

Doyon, Limited

Bristol Bay Native Corporation

Sophie Minich

Andrew Guy

President & CEO

Cook Inlet Region, Inc.

Calista Corporation

Gabriel Kompkoff CEO

www.akbizmag.com

Chugach Alaska Corporation

September 2016 | Alaska Business Monthly

ALASKAN SOURDOUGH

Hazel Englund Celebrates 100 Years in Haines

Hazel Englund picking blueberries. Photo courtesy of Mikki Chandler

Alaska Business Monthly | September 2016

www.akbizmag.com

Hazel Englund at home in Haines. Photos courtesy of Mikki Chandler

Happy Birthday Hazel By Mikki Chandler

M Hazel with three of her four children: Keitsie, Emily, and Josephine Hazel (far right) in front of the Road Commission office in Haines.

Hazel (far right) with children Glen and Josephine.

Photos courtesy of

Hazel Englund

Hazel and her family. www.akbizmag.com

y Grandma turns one hundred years old this September. Hazel Englund was born in Haines, Alaska, where she still resides today and is a true Alaskan Sourdough with an amazing story. In the early 1900s Hazelâ&#x20AC;&#x2122;s parents, Henry and Minnie Vermeire, set off to Alaska with dreams of being successful farmers. They landed in Haines and raised nine children by selling potatoes. Growing up on a farm was a lot of hard work. After farm chores were done the kids would find odd jobs. Once Hazel and her sister Clara shaved their heads and called each other Pat and Mike so they could work on a construction crew. Being a young lady in a small town with an Army Base did have its advantages. There were many dances and plenty of fellas calling on Hazel. My Grandma was twenty-two before she married as she wasnâ&#x20AC;&#x2122;t sure she wanted to be tied down, but Niles Englund won her heart. In 1938 Hazel married Niles and they had four children: Glen, Keitsie, Josephine, and Emily. Hazel and Niles lived in a shack two miles out of town until they completed their house out-of-pocket and with no electricity in 1946. Thank goodness Niles was

September 2016 | Alaska Business Monthly

Photo courtesy of Mikki Chandler

Hazel Englund ‘head down and butt up’ in her garden—the same garden and pose she’s had for the last seventy years.

an expert carpenter because Hazel still lives in that house today. In the mid-1900s jobs were scarce in Alaska and many times the men worked remote. Hazel was a housewife who worked as hard as her husband. Gardening wasn’t a hobby and people didn’t hunt and fish for fun. Everything was made from scratch, and during the winter months Hazel made her children’s clothes. There is a two-hundred-foot clothesline off the front porch that has held four generations of apparel. When times were tough Hazel and Niles would pan for gold in Porcupine. In 1978 they panned enough to buy a truck that we still drive today. Hazel is a wise woman who always lived within her means. She takes care of what she has and is very proud of it. One of the things you can count on is her house being exactly the same every time you visit. Grandma uses serving spoons and a rolling pin that were given to her by a military cook over seventy years ago. She still cooks on a 1950 woodburning Monarch stove that has baked some of the best bread in the world. There is a mirror in the living room that came from Montgomery Ward in the 50s, and I’m pretty sure her berry picking buckets are older than me. When you go to Grandma’s you treat her and her stuff with respect. In the summer Hazel can be found head down and butt up in the garden. She is the sweet, cooking, baking, adoring Grandma, 10

Hazel Englund saying “Hi!” to Alaska Business Monthly readers. Photo courtesy of Mikki Chandler

but she is also quick with a dirty joke and readily shares her opinion. I told my Grandma in August that she looked great. She responded with, “Life is good unless you weaken.” I learned a lot from her, and my memories are rich with simple pleasures. She has made the best with what she had—family is always first and she is content with the life she has lived. R

Mikki Chandler is Hazel Englund’s granddaughter. She is the mother of a fourth generation Alaskan and she’s trying to teach her daughter the values her grandmother taught her. Chandler works for BP Alaska, proudly supporting oilfields just as her dad, her husband, and her stepchildren have. She says, “We all love everything Alaska has to offer and I’m hoping there will be many more generations of Alaskans in our family.”

Alaska Business Monthly | September 2016 www.akbizmag.com

Only pay for the speed you need... Dynamic Routing!℠

On time and on budget. At Lynden, we understand that plans change but deadlines don’t. That’s why we proudly oﬀer our exclusive Dynamic Routing system. Designed to work around your unique requirements, Dynamic Routing allows you to choose the mode of transportation — air, sea or land — to control the speed of your deliveries so they arrive just as they are needed. With Lynden you only pay for the speed you need!

lynden.com | 1-888-596-3361

SPECIAL SECTION

Alaska Native Business

Arctic Slope Regional Corporation subsidiary ASRC Energy Services North Slope ground blessing. © Chris Arend chrisarendphoto.com / Courtesy of ASRC

Alaska Native Regional Corporations Overview Growth and diversity drive economic engine By Julie Stricker

or decades, economists have warned Alaskans that putting the bulk of their economy in the oil patch would have dire effects. And with oil prices in the tank, those warnings have proven out, with the state economy in shambles. That was a lesson the Alaska Native regional corporations have also learned. Over the past decades, the corporations have grown and diversified and have become an economic engine in Alaska, bringing in billions of dollars annually from their businesses around the globe and employing thousands of Alaskans. The corporations were formed under the 1971 ANCSA (Alaska Native Claims Settlement Act), which tasked them with dual financial and social mandates. Under ANCSA, 12

Alaska’s Natives ceded control of 320 million acres of land in return for title to 44 million acres and $962.5 million. This was divided between twelve regional and two hundred village corporations. A 13th corporation was later created for Alaska Natives living outside the state. In the past forty-five years the corporations have grown, with subsidiaries operating in government services, oil, tourism, real estate, construction, natural resources, transportation, and more. In addition to creating profitable businesses to support shareholders, they also spend millions of dollars each year in support of maintaining their cultures and languages, as well as educational scholarships, internships, and technical training opportunities. Today, some are also investing in oil and gas exploration, hoping to lower the high costs of energy in the state. Here is an overview of the corporations’ operations in fiscal year 2015 and some of their 2016 activities.

Ahtna Corporation

Ahtna Corporation is hoping to strike natu-

ral gas on land not far from its Glennallen headquarters. The corporation, with more than 1,900 shareholders and a land base in the Copper River Valley, has long had expertise in the oil and gas industry and is seeking new sources of natural gas to provide energy to local residents, as well as jobs. In early 2016, the Alaska Division of Oil and Gas approved the Tolsona gas exploration, located on state land just eleven miles from Glennallen. A previous well drilled about ten years ago showed signs of gas but was abandoned because of high-pressure water zones. “We are optimistic of a resource discovery that will help address the rural energy crisis in the Ahtna region,” President Michelle Anderson states in a news release. “A substantial discovery would benefit not only the Ahtna region, but the state at large. It would provide a boost to the economy by putting Alaskans to work and help to alleviate the high energy costs that many residents experience.” Ahtna is a vocal proponent of the state’s LNG (liquefied natural gas) project. It would be the largest single landowner along the proposed pipeline route, Anderson says in a letter to shareholders. “We continue to meet with key project stakeholders to put Ahtna in a favorable position to take advantage of contracting opportunities and gainful employment for our people,” according to Anderson.

Alaska Business Monthly | September 2016 www.akbizmag.com

The Aleut Corporation

2015 was a challenging year for The Aleut Corporation (TAC), which made several changes to its management team, including a new CEO, chief financial officer, and human resources director. CEO Matthew T. Fagnani notes some subsidiaries had “lackluster performances” in 2015. C&H Testing, for instance, saw much of its work in Bakersfield, California, dry up due to low oil prices. Some resources were moved to more successful operations in North Dakota. TAC’s other major contracting subsidiary, Patrick Mechanical, continues to do well in Interior Alaska, but may feel the pinch with expected reductions in state-funded projects. Aleut Management Services, which represents the largest source of contract revenues for TAC, saw a 34 percent increase of revenues, to $69.6 million, over FY2014. However, its net income saw a decrease of 27 percent, to $669,460. Because of poor performance, TAC wrote off $3 million in intangible assets for C&T and Analytica. In addition, the corporation www.akbizmag.com

Courtesy of ASRC

Arctic Slope Regional Corporation subsidiary Petro Star asphalt plant construction.

also logged a $15 million adjustment to its Deferred Tax Assets. Dividends decreased 43 percent compared with 2014, and elder benefits remained steady at $500 per elder. Total gross revenue for FY 2015 was $137.9 million, up from $120.3 million in 2014. Of the total, $116.6 million came through contract revenues and $9.8 million through fuel sales. Including the tax adjustment, the corporation saw a net loss of $17.4 million. Fagnani notes the corporation has instituted an “unrelenting focus” on profitability and is setting benchmarks, strategic plans, and budgets that will allow more oversight on subsidiaries. When TAC President Thomas Mack was growing up in King Cove, there were no culture camps, but today they are a vital part of the cultural outreach for the Aleutian-based corporation. “As our population ages and we sadly lose fluent Unangam Tunuu speakers, we recognize the vital importance of preserving our language and culture,” he tells shareholders and descendants in TAC’s 2015 annual report. “Culture Camps were developed as a way to preserve and teach the language, traditional arts, beading, basketry, cooking, and dance.” Today, seven culture camps are held every year, attracting hundreds of shareholders and descendants, he says. Nonprofit The Aleut Foundation awarded 207 scholarships totaling $708,803 in FY2015. It also provided community development training programs for forty-one individuals, in addition to funding shareholder and descendant participation on the cultural camps.

Arctic Slope Regional Corporation Barrow-based Arctic Slope Regional Corporation (ASRC) has continued to diversify its earnings through key investments, says spokesman Morgan Thomas. The aim is to reduce the corporation’s reliance on the Alpine oil field and other natural resources royalties. In fiscal year 2015, ASRC pulled in revenues of $2.5 billion, slightly below their 2014 earnings of $2.6 billion. In 2015, ASRC acquired both Arctic Pipe Inspection, Inc. and Data Networks Corporation, Thomas says. Arctic Pipe Inspection is a Houston, Texas-based company that has provided nondestructive testing of oil country tubular goods for more than forty years. Data Networks Corporation, based in Virginia, provides a broad range of information technology and program management services to the federal government. ASRC also made several investments that demonstrate its commitment to communities on the North Slope, the oil and gas industry, and the state of Alaska, Thomas says. The lack of high-speed broadband throughout the Arctic has impeded vital operations, such as environmental protection to emergency response. It also severely restricted economic development opportunities because of the low-quality broadband communication and the high costs of outdated technology. In November 2015, ASRC made an investment in Quintillion Holdings LLC and now holds a minority interest in the Anchorage-based telecommunications company, Thomas writes in an email. The Quintillion Subsea Cable Project is an international

September 2016 | Alaska Business Monthly

ALASKA NATIVE BUSINESS SPECIAL SECTION

Ahtna’s business arm, Ahtna Netiye’ Inc., oversees the operations of thirteen subsidiaries in areas such as government contracting, civil and vertical construction, facilities management and support services, and oil and gas pipeline maintenance and construction. In 2015, the corporation showed gross revenues of $188.4 million, slightly above 2014’s $185 million. In 2015, Ahtna Netiye’ acquired AAA Valley Gravel, which is located near areas in the Matanuska-Susitna Valley that are likely to benefit from federally funded transportation projects over the next several years. Another subsidiary, government contractor Ahtna Facilities Services, Inc., won a substantial contract to provide janitorial services on Joint Base Elmendorf-Richardson. The contract amount was not disclosed, but it involves providing services to more than one hundred buildings. Ahtna Facilities Services, which was established in 2006, is on track to graduate from the Small Business Administration 8(a) program in 2018. It current has 118 employees. In 2015, Ahtna used a variety of forums to reach out to its shareholders and their descendants, hosting open houses, candidate forums, and receptions in Glennallen, Fairbanks, and Anchorage, as well as subsidiary offices in California and Seattle. Ahtna’s shareholder development has been working with students in local schools to help them plan what courses they should be taking in preparation for future careers. Ahtna also helps shareholders at regional job fairs and is partnering with unions to develop training and apprenticeship opportunities.

ALASKA NATIVE BUSINESS SPECIAL SECTION

telecommunications plan that seeks to link Europe and Asia with a fiber-optic broadband cable running along the Arctic coast, with offshoots to Alaska communities such as Point Hope, Wainwright, and Barrow, as well as the Prudhoe Bay oilfields. Work on the Alaska portion of the project is expected to be completed and service begun by the first quarter of 2017. “Bringing affordable, fast, and reliable Internet service to northern Alaska will allow North Slope communities to develop 21st century economies by connecting them to the rest of Alaska and the rest of the world,” Thomas says. Two ASRC subsidiaries started significant projects in 2015. ASRC Energy Services broke ground on a forty-thousand-squarefoot maintenance facility in Deadhorse, which will feature a fully integrated shop for equipment rentals, maintenance services, and fleet management to support the oil and gas industry. ASRC also invested in a new asphalt plant at Petro Star’s North Pole refinery, which will provide a much-needed supply of asphalt to Interior Alaska. ASRC also joined representatives from NANA Regional Corporation and Bering Straits Native Corporation to form the Inuit Arctic Business Alliance, whose mission is to provide a unified voice, collective vision, guidelines, and venue for companies wishing to do business in the Arctic. ASRC has 12,265 shareholders, many of whom still call the North Slope home. Throughout 2015, the corporation and shareholders participated in a number of events and programs such as Iñupiat Days, the Ivalu Gala, and some shareholders paid a special visit to the White House. Iñupiat Days takes place in each of the villages on the North Slope and focuses on Iñupiaq values, culture, and tradition. In March, ASRC hosted the first Ivalu Gala benefitting the Arctic Education Foundation, a nonprofit that provides support to eligible Iñupiaq students. In early July, a group of young ASRC shareholders attended the historic White House Tribal Youth Gathering in Washington, DC, in response to an invitation for the Generational Indigenous Challenge, Thomas says. They had a private meeting with First Lady Michelle Obama and met with State Department officials to discuss the Arctic, Inuit youth, natural resources, and climate change. They also performed an Eskimo dance in front of nearly one thousand other indigenous students from across the United States.

Arctic port at Port Clarence, north of its Nome headquarters, because of increasing marine traffic through the Bering Strait. The corporation expects to soon receive title to the land at Point Spencer under the Coast Guard Reauthorization Act of 2016. “The need to develop infrastructure and facilities in a manner that improves marine safety while protecting local communities is central to BSNC’s efforts at Port Clarence,” a news release states. The development of the port is expected to lead to regional economic development, jobs for BSNC shareholders and descendants, and increased dividends. BSNC, with 7,534 shareholders, has a land base covering most of the Seward Peninsula and Norton Sound region. It has operations in real estate management, development, tourism, mining services, and government contracting. In 2015, it recorded gross revenues of $304.4 million, up from $229.4 million in 2014. It was the 11th consecutive year of financial growth for the corporation and the eighth consecutive year it has issued dividends. One of its subsidiaries was awarded a contract to operate the El Paso Service Processing Center in Texas, which houses about seven hundred people at a time awaiting deportation proceedings. Another was awarded a contract to drain and close fuel tanks in more than fifty rural Alaska communities. In June, BSNC subsidiary Inuit Services announced plans to place commercial mooring buoys at Port Clarence that would be available for industry, government, and private boats. According to the release, BSNC acquired the mooring systems from Shell Alaska after that company pulled out of the Beaufort and Chukchi basins. “BSNC stands poised to meet the Arctic future at the gateway to the Arctic, the Bering Strait,” President and CEO Gail Schubert says in a letter to shareholders. In May, Schubert notes how warmer weather has limited the ability of shareholders to travel on the sea ice to hunt seal and walrus on their traditional grounds. The lack of sea ice is also contributing to erosion in regional villages such as Shaktoolik and Shishmaref. Despite these challenges, Schubert says, she is pleased to see descendants continuing subsistence traditions. “We are a living culture,” she writes, “and while changes in our environment and lifestyles have occurred, our traditions are what bind us to our past and ensure that our way of life will continue to thrive and survive through our descendants.”

Bering Straits Native Corporation For the past several years, Bering Straits Native Corporation (BSNC) has been actively pursuing the construction of a deep-water

Investing within its home region of Bristol Bay region has been a priority for Bristol Bay Native Corporation (BBNC). The corporation operates a separate private equity fund, the

Bristol Bay Native Corporation

Bristol Bay Development Fund, which actively looks for entrepreneurial businesses within the region, such as container farms and marine operations. Besides directly supporting those businesses, BBNC is also looking for ways to provide needed services such as construction, accounting, and maintenance locally, which would keep the money in the region and help it grow economically. The corporation also partners with village corporations through joint ventures or as a mentor and resource to guide them through the complicated landscape of government contracting. The partnerships help the smaller businesses land and successfully complete government contracts under the Small Business Association 8(a) program. The bulk of BBNC’s revenues are created via operating businesses in such areas as government contracting, petroleum distribution, oilfield and industrial services, construction, and tourism. In Fiscal Year 2015, BBNC reports gross revenues of $1.735 billion, slightly less than in 2014. The decrease is largely due to the effect of falling oil prices on its PetroCard petroleum distribution subsidiary. That decrease was partially offset by increases in its oilfield services holdings, which included the first full year of its ownership of Peak Oilfield Service Company. In 2015, BBNC ramped up its real estate management business in the Anchorage area, developing and redeveloping commercial properties that it can make available to its subsidiaries or other Native corporations. In May 2016, BBNC purchased Katmailand, which includes the popular bearviewing and fishing destinations of Brooks Lodge and Grosvenor Lodge within Katmai National Park and Kulik Lodge on Nonvianuk Lake. BBNC President and CEO Jason Metrokin says the corporation has been interested in buying the properties, which were established in 1950. “BBNC is excited about its acquisition of Kathmailand,” Metrokin says in a news release. “The lodges are incredible locations that are in the heart of Bristol Bay and are critically important to the ancestry and history of many of our shareholders. … The lodges and operations will be significant additions to BBNC’s tourism operations and can offer additional opportunities for local and shareholder employment.”

Calista Corporation

Based in Bethel, with headquarters in Anchorage, Calista Corporation is the second largest of the twelve Alaska-based regional corporations with 13,000 shareholders and more than 6.5 million acres. The region includes fifty-six villages of mostly Yup’ik and Cup’ik residents, which are incorporated into forty-six village corporations.

Alaska Business Monthly | September 2016 www.akbizmag.com

Sometimes it’s obvious when you’ve had a breach. The most likely victims of a cyber-breach are small to mid-size businesses – making up more than half of all attacks. Businesses today — no matter their size — need to help keep their data and electronic devices highly secure. If you don’t, you risk becoming the target of a cyber-attack. Maximize your productivity and minimize your worry. Let AT&T help. Speak with an AT&T representative about Network Security solutions today. 907-264-7387 1-800-955-9556

Source: Symantec Internet Security Threat Report, Volume 20 © 2016 AT&T Intellectual Property. All rights reserved. AT&T, the Globe logo and other marks are trademarks and service marks of AT&T Intellectual Property and/or AT&T affiliated companies. All other marks contained herein are the property of their respective owners. This document is not an offer, commitment, representation or warranty by AT&T and is subject to change.

ALASKA NATIVE BUSINESS SPECIAL SECTION

Calista oversees thirty-five subsidiaries in sectors such as military defense contracting, construction, communications, real estate, environmental and natural resource development, information technology, and media services. In FY 2015, Calista reported gross revenues of $460.1 million, an increase over 2014’s $401.9 million. In spring 2016, Calista declared a record $5.6 million dividend. Calista has provided more than $43.2 million in dividends and elders distributions, as well as $4 million in scholarships since 1994. Five of its dividends have been declared since 2014, which was the first time the corporation had declared two dividends in one calendar year. The spring dividend is determined by shareholder equity. The fall dividend is from the Akilista investment portfolio, an investment fund created to provide a perpetual source of dividends not dependent on business operations. “Calista’s dividends are more than discretionary spending money for our shareholders,” Margaret Pohjola, chair of the Board of the Directors, says in a release. “The YukonKuskokwim Delta is one of the most economically challenged regions in the country. Shareholders have shared with us that these dividends are used to purchase gas for use in subsistence activities, food for their families, and supplies for their homes.” The cost of heating fuel, for example, is several times higher than the national average. Calista has been exploring alternative energy projects, such as wind, hydroelectric, and geothermal energy. Improvements in the region’s infrastructure have also helped lower distribution costs for oil and gas. Southwest Alaska is rich in resources and is home to one of the world’s largest gold resources, the Donlin Gold project. It is owned equally by Barrick Gold Corporation and NovaGold Resources and sits on land whose surface rights are owned by village corporation The Kuskokwim Corporation. Calista owns the subsurface. The project is currently in the permitting stages, but has the potential to have a strong impact on the region’s economy through jobs, education, and infrastructure, as well as royalty payments to the corporations. Calista is currently in the process of enrolling the descendants of shareholders in 2017, which is expected to triple the number of shareholders.

Chugach Alaska Corporation

In 2014, Chugach Alaska Corporation’s Board of Directors adopted a one-hundred-year plan focused on sustaining the corporation for future generations of shareholders. The company, with its headquarters in Anchorage and a land base in the Prince William 16

A Chugach Alaska Corporation elder is interviewed for the corporation’s new video series. Courtesy of Chugach Alaska Corporation

Sound region, maintains a business model that leverages diverse company and investment holdings. It works in three primary lines of business: government services, facilities services, and energy services, as well as maintaining a strong investment portfolio. “We are growing, but more importantly we are creating a more mature, more stable, and more sustainable Chugach,” says CEO Gabriel Kompkoff. Chugach reports stable growth in FY 2015, with total revenues climbing to $758.5 million, $132.7 million over 2014. Government services, its largest sector, posted steady growth in 2015 despite intense competition, widespread cost cutting, and declining margins amid the federal government’s budget reductions and regulatory changes, Chugach officials say. “But companies who will weather the storm will be those who are able to adapt to changes quickly, provide meaningful value to customers, and operate with integrity.” In its energy services sector, Chugach completed the acquisition of Kenai-based oil and gas support services company All American Oilfield LLC. Among its other investments, Chugach acquired a minority interest in Geneva Woods Pharmacy, which provides integrated pharmaceutical care for patients in Alaska and elsewhere. The corporation is also looking at natural resource development in the Chugach region, which is rich in timber and minerals.

Earnings generated by its operating businesses fund its investment portfolio, Chugach Heritage Foundation endowment and shareholder trust. Profits also directly fund programs that directly benefit shareholders. In 2015, Chugach Alaska returned $15.4 million in benefits to its 3,841 shareholders and descendants, including $9 million in total dividends, including distributions to elders; $700,000 in scholarships; $486,000 for intern and scholarship programs; $6.8 million in wages to shareholders, spouses, and descendants; and $940,200 toward cultural programs, including Chugach’s Nuuciq Spirit Camp. The corporation also produced a new video series designed to tell Chugach’s story and bridge the gap between the corporation and new generations of shareholders and descendants. The videos are available on YouTube. “We will continue to experience profound transformations that require our leaders to make important decisions about the future of the company,” Kompkoff says. “Our rich cultural heritage and spirit of self-determination drives us to confront these changes proactively and strengthen our business in kind. All the while, our fundamental purpose remains at the heart of all our decisions—creating sustainable shareholder value.”

Cook Inlet Regional, Inc.

Cook Inlet Regional, Inc. (CIRI), based in Southcentral Alaska, has made a distinc-

Alaska Business Monthly | September 2016 www.akbizmag.com

www.akbizmag.com

ALASKA NATIVE BUSINESS SPECIAL SECTION

tive mark on Anchorage over the past decade, including the construction of the Fire Island Wind project, Tikahtnu Commons, and its new headquarters, the Fireweed Business Center in the heart of Midtown. CIRI’s operations span a diverse segment of businesses such as real estate, oilfield and construction services, land and natural resources, energy and infrastructure, environmental services, tourism, and hospitality. It is the largest private landowner in Southcentral Alaska, with 600,000 surface acres and 1.3 million acres of subsurface holdings. For 2015, CIRI reports gross revenue of $268.2 million, down from 2014’s $304.4 million. President and CEO Sophie Minich notes the downtown was largely due to lower commodity prices that affected subsidiary Cruz Energy Services. Net income also declined, but Minich says that 2014 net income was boosted by the sale of its Lost Pines Resort and Spa in Texas. Besides building and moving into its new headquarters, CIRI also signed its first tenant to Fireweed Business Center, Stantec, an engineering firm. In 2015, CIRI also completed the sale of its property management company, Pacific Tower Properties, Inc. It also broke ground on its Ladera development, a 1,100-acre planned community in San Antonio, Texas. CIRI subsidiary Cruz Marine is constructing a state-of-the-art barge to service Alaskan customers. Its shallow draft tug Dana Cruz also returned to Alaska from Australia, where it had been under longterm charter. Cruz Energy Services, operating in North Dakota’s Bakken oil field, saw a significant slowdown due to falling oil prices as rigs were idled in the region. CIRI land contains several prospective oil and gas deposits, many of which are under lease or exploration agreements with AIX Energy, Aurora Gas, and Hilcorp Alaska. CIRI has also begun a seismic data acquisition project on subsurface lands in the Shadura area, located primarily within the Kenai National Wildlife Refuge. CIRI continued its investments in the energy sector in 2015, becoming a major investor in a Middleton, Ohio, power plant fueled by natural gas. Its environmental services sector, led by its subsidiary North Wind Group, saw significant growth in 2015, capturing large multi-year projects. Its operating subsidiary, North Wind Site Services, obtained SBA 8(a) certification. In tourism, CIRI’s Kenai Fjord Cruises showed stronger-than-expected demand, which, coupled with low fuel prices, drove strong growth. CIRI sold the business early in 2016. Among many milestones accumulated by the Alaska regional corporations over the

Your Voice Matters

VOTE for our

CULTURE

VOTE for our

TRADITIONS

VOTE for our

FUTURE

Register to Vote Today www.elections.alaska.gov Paid for by Get Out the Native Vote - Interior Alaska September 2016 | Alaska Business Monthly

ALASKA NATIVE BUSINESS SPECIAL SECTION

Doyon spud the Toghotthele #1 well on June 1, marking the start of the summer drilling effort. CIRI joins that effort, as well as Doyon’s broader exploration of the Nenana basin. Photo by Tim Flynn / Courtesy of Doyon Limited

past forty-five years, CIRI notes that its cumulative distributions to shareholders top $1 billion. It has an active internship program and backs a program called AlaskaNativeHire.com, a website aimed at increasing employment of Alaska Natives across the state, in addition to CIRI shareholders and descendants. CIRI also contributes to a number of regional nonprofits, such as the Alaska Native Justice Center, Cook Inlet Housing Authority, Cook Inlet Tribal Council, and Koahnic Broadcast Corporation.

Doyon, Limited

Doyon, Limited is hoping it will be able to announce news of a significant natural gas or oil find this fall as drilling continues in the Nenana basin. Doyon, based in Fairbanks, is the largest private landowner in Alaska with 12.5 million acres. It is owned by more than 19,300 shareholders, most of whom are Athabascan from Alaska’s vast Interior. About three-quarters of Doyon’s shareholders live in Alaska. It has a diverse business portfolio, which produced the highest operating income in the corporation’s history in 2015. Doyon reported total revenue of $378 million, an increase over 2014. Net income was about $70.8 million, a significant increase over 2014’s $48.5 million. 2015 was the 31st consecutive year of profitability for Doyon, resulting in a dividend of $4.95 per share, totaling $9.1 million. Doyon completed two major projects in 2015: It got all of Doyon’s Remote Facilities and Services camps under contract and it completed the construction of Rig 142, the newest rig in the Doyon Drilling fleet on schedule and on budget. Rig 142 is under a five-year contract with ConocoPhillips on the North Slope. 18

Doyon’s businesses are grouped into three pillars: oilfield services, government contracting, and natural resources development. In 2015, revenue under the oilfield services pillar increased slightly over 2014 to $130.1 million. Doyon Associated, a construction company owned by Doyon Oil Field Services, was contracted to build a pipeline on the east side of the North Slope from Badami to Point Thomson, which was completed in 2015. It also completed the CD-5 pipeline installation in 2015. Doyon expects the slump in oil prices to have an adverse effect on the sector in 2016. Revenues from the government services pillar declined in 2015 to $114.5 million, but operating income was slightly up. Under its natural resources pillar, sales of rock and gravel declined, due to declining federal funding for rural capital projects. Doyon funds exploration projects on its lands to generate information on minerals to help encourage partnerships with thirdparty oil, gas, and mining companies. In 2015, Doyon completed surveys in the Fortymile and Northway areas to identify potential deposits of high-grade copper, zinc, lead, and silver deposits. Doyon flew an aerial reconnaissance at its Sithylemenkat prospect to detect concentrations of rare earth elements. All three areas returned positive results. More exploration was planned for this summer.

Koniag, Inc.

Koniag, Inc. is in the midst of a turnaround. The corporation, with a land base in the Kodiak archipelago, recently completed its 2016 fiscal year, the third year for CEO Elizabeth Perry, who has focused management efforts strongly on operating company performance.

Koniag’s 2016 net earnings of $7.7 million reflect an increase over the previous two years—$4.3 million in 2015 and $1.9 million in 2014. Koniag’s principal line of business is operating companies, supplemented by commercial real estate investments and ANCSA natural resource management investment securities. Koniag manages approximately 145,000 acres of surface estate and 990,000 acres of subsurface estate. Koniag’s business model is driven by operating companies, which as of the end of FY16 (March 31, 2016) comprise about 67 percent of Koniag’s total assets. Information technology services and government services sectors combined make up 90 percent of the operating revenues. Koniag has strategically chosen professional services as the driving characteristic of its family of companies, with an emphasis on companies that provide innovative, solution-oriented, expert services in today’s evolving technological and natural landscape, Perry says. Koniag’s information technology services sector serves the commercial marketplace, and the government services sector contains a mixture of small and large businesses. Koniag’s investment in these two sectors is intentional, as the commercial sector provides balance to risks associated with federal spending uncertainty, and vice versa, Perry says. The outlook for growth is positive, she says, and the businesses are adapting to rapidly changing competitive environments. Information Technology Services recently formed two new subsidiaries in Hong Kong and Singapore to meet foreign demand, and the sector completed the acquisition of a technology design services company. The government services sector continues to win competitive federal government contracts with projected consistent revenue streams, she says. Koniag’s quarry, technical services, oilfield services, and tourism sectors represent the remaining 11 percent of operating revenues. While it was under development, the quarry provided materials for projects such as the Kodiak Airport expansion. Koniag also owns Karluk Wilderness Adventures, which provides bear viewing expeditions on Kodiak Island. It plans to build a guest lodge and additional facilities. Koniag has 3,908 shareholders. One of the most significant benefits Koniag provides is scholarship assistance through its nonprofit, the Koniag Education Foundation (KEF), Perry says. A $5 million endowment established in 1993 supports KEF, as well as yearly donations to fund education and employment opportunities for Koniag shareholders and descendants. KEF has awarded nearly $4 million in scholarships over the past twenty

Alaska Business Monthly | September 2016 www.akbizmag.com

NANA Regional Corporation

Mining continues to drive the economy in Northwest Alaska, home to NANA Regional Corporation. In addition to the giant Red Dog zinc mine northwest of Kotzebue, mining exploration continues in the Ambler and Kobuk region with NovaCopper, as well as several other places around the region. In addition to resource development, NANA has a diversified portfolio of businesses including oilfield services, federal contracting, engineering and construction, real estate and hotel development, information technology, and telecommunications. In FY 2015, NANA reported $1.6 billion in total revenues. Its board declared a dividend of $8 per share, totaling about $12.7 million, to its 13,800 Iñupiat shareholders. In addition to dividends, NANA also contributes millions of dollars annually for scholarships, medical, burial and disaster assistance, economic development, and language preservation. NANA worked with the Iñupiaq Language Commission to launch a free Iñupiaq language app, called “Inupiaraaqta,” which means “Let’s speak Inupiatun.” It’s also a major employer and one of the largest in Alaska. NANA and its subsidiaries under its NANA Development Corporation (NDC) arm employ more than 15,000 people worldwide, including 5,000 Alaskans. In 2015, NANA employed 1,653 shareholders who earned a combined $70 million in wages. Red Dog, the giant zinc mine north of Kotzebue, employed more than 600 NANA shareholders in 2015, who earned $39.3 million in wages. NANA currently has a portfolio of mining projects, ranging from the producing Red www.akbizmag.com

Dog mine to advanced exploration in the Upper Kobuk area and initial exploration in the Fairhaven area of the upper Seward Peninsula west of Candle, says Larry Miller, NANA Regional vice president for natural resources. “You need the different stages of projects in the pipeline for that sustainability and as an economic engine,” Miller says. Fairhaven is part of a forty-mile-long mineralization zone that has seen some historic placer mining, he says. During initial exploration, NANA found from 10 to 20 grams per ton of gold in its initial drilling. “It’s probably one of the lode sources for the placer gold in the region,” he says. “That’s exciting in itself.” The site needs more work to prove up the extent of the mineralization and see if it will be economic, Miller says, but “it’s enough that we’re out there looking for partners at this point.” NANA is also actively looking for natural gas in the region, Miller says. In May, NDC sold NANA Oilfield Services to North Star Petroleum, which is under the Saltchuk umbrella. About 40 percent of NDC’s revenues are associated with the oil industry, and low prices have proved challenging. In July, Moody’s downgraded NDC’s debt rating. NANA officials released a statement in which NDC Board Chairman Ely Cyrus states, “The board of directors of NDC has remained committed to ensuring the strategic focus of the company delivers to performance expectations. As our work in the federal government shows, we believe we have the right balance of skills and diversity to meet the challenges that we face.”

Sealaska

Sealaska has a long-term strategic plan, which includes short-term goals such as generating enough profit from businesses to cover all the corporation’s costs, including cultural and community-related activities. The corporation wants to move away from a dependence on ANCSA 7(i) revenue sharing and investment income, which proved to fluctuate too much. In 2015, they were well on their way. Sealaska, which covers most of Southeast Alaska and is based in Juneau, reported $109.4 million in gross revenue for fiscal year 2015 and $12 million in net revenue. Sealaska also adopted a broad long-term strategy: “Operate within relevant industries (plus) improve existing businesses (plus) value based investment in our businesses (equal) sustainable growing business.” Its businesses are aligned into three categories: natural resources, natural foods, and government services, which has a focus on water, energy, and maritime services. Under the Sealaska Government Services

umbrella, subsidiary SeaCon is working with the Army Corps of Engineers to build a four-thousand-foot levee to restore the salmon habitat in the Qwuloolt Estuary in Marysville, Washington. It’s a project the Tulalip Tribes, the Army Corps, NOAA, and other organizations have been working on for two decades. SeaCon also completed a National Park Service contract to demolish boulders in Glines Canyon below the former Elwha Dam in Washington on the Olympic Peninsula to allow salmon to swim freely upriver. Haa Aani is a holding company that includes Sealaska’s natural resource and economic development efforts. Of Sealaska’s 362,000 acres, it plans to manage 35 percent in perpetuity as a working forest. Under the forest cycle, Sealaska plans to maintain a healthy forest, protect wildlife habitat, maintain four hundred to six hundred natural resource jobs, and create millions in regional payroll, the company says. The remaining 65 percent will be used for opportunities such as development of a carbon project, wetland mitigation, natural product harvest, selective harvest, and community and cultural use. In May, Sealaska made its first major investment as part of its 2012 strategic plan, purchasing a minority interest in Independent Packers Corporation, a custom seafood processor in Seattle. Sealaska Chief Operating Officer Terry Downes notes the company’s next immediate goal will be to acquire a stake in a water services company. The Haa Aani Community Development Fund, Inc. is helping small entrepreneurs find success through its partnership with The Nature Conservancy with its Path to Prosperity business plan competition. More than 105 original Path to Prosperity applications were submitted within the first three years, representing eighteen communities and twelve industries. In 2015, Sealaska contributed $1.5 million in cash and in-kind donations to its Sealaska Heritage Institute, which provides services and cultural and educational benefits. Since its inception in 1980, Sealaska has donated $32.8 million to Sealaska Heritage Institute. It maintains active scholarship and internship programs. “Sealaska is a thought leader in the Alaska Native community and at home in Southeast Alaska,” its 2015 annual report states. “Our leadership advocates for many issues important to shareholders, from landless claims to language recognition and subsistence issues.” R Freelance journalist Julie Stricker lives near Fairbanks.

September 2016 | Alaska Business Monthly

ALASKA NATIVE BUSINESS SPECIAL SECTION

years. In FY15 KEF awarded $277,205 in total scholarships to 156 students. KEF’s top scholarship is the Angayuk Scholarship and Internship program, which was created to seek out Koniag’s best and brightest shareholders and descendants to intern with Koniag and its subsidiaries. Three $10,000 Angayuk scholarships are awarded each year in addition to the internship experience. The program allows the student to focus on his/her field of study and gain related work experience during the summer, while helping Koniag identify, cultivate, and encourage future leaders, Perry says. In addition to promoting education, Koniag financially supports a variety of Alutiiq cultural programs, particularly the Alutiiq Museum and the Alutiiq language program. The Alutiiq Museum, in downtown Kodiak, is dedicated to sharing and preserving Alutiiq culture. Koniag contributes each year to the museum and participates in museum governance. Shareholders receive free admission.

Photo courtesy of Eklutna, Incorporated

SPECIAL SECTION

Alaska Native Business

Eklutna Village Clinic, the health clinic recently completed to service the Village of Eklutna.

Alaska Native Village Corporation Review Partnerships and diversification drive growth By Tasha Anderson

laska Native Village and urban Corporations are a huge part of Alaska’s economy, participating in all of its major industries and often securing outof-state or out-of-country contracts which funnel money back into the state. As these companies build their individual economies and communities, they contribute in multifaceted ways to Alaska as a whole. Below is a review of just a few of these companies and their projects over the last year.

Goldbelt, Inc.

Goldbelt, Inc. is an Alaska Native Urban Corporation headquartered in Juneau with more than 3,400 shareholders. In July 2016 the company announced that Elliot “Chuck” Wimberly would serve as its president and CEO. Wimberly had been acting as Goldbelt’s interim president and CEO since late December 2015. Prior to taking on his current role, Wimberly had worked for Godlbelt for six years as the senior VP of Federal Operations in the Washington, DC, area, overseeing the medical, defense, and construction portfolio companies. He had previously served as the interim president one other time in 2011 for approximately 20

nine months. Wimberly says his transition to president and CEO has gone well. “I don’t have the learning curve that someone who would be new to Goldbelt would experience; I have a working relationship with all of our board members, I know the history of Goldbelt, and I know all the operating unit presidents,” he says. In the President & CEO Report in the Spring 2016 “Kookénaa Messenger” Wimberly said, “Despite the changes in leadership, Goldbelt remains stable and continues to experience growth. We are excited about the financial results of calendar year 2015, in both our federal market and in our Alaska operations.” Wimberly says Goldbelt has been focusing on diversification options and investment opportunities in Juneau, the Pacific Northwest, and other parts of Alaska. He says Goldbelt’s history has been one of transition. “Initially with the granting of the land that was received there was timber on that land and it was natural to harvest timber, and so for the first iteration of Goldbelt we were a timbering company.” After timber the company moved into tourism in Southeast Alaska, which operations included some small cruise ships in Southeast, the Mount Roberts

Tramway in 1996, and the Goldbelt Hotel in 1997. “We no longer operate the cruise ships, but we still operate the Mount Roberts Tramway at Juneau,” Wimberly says. The Goldbelt Hotel was sold in July of 2015. In 1998 Goldbelt ventured into the federal contracting market with its first SBA 8(a) company, Goldbelt Raven, which provided medical research scientists to the defense department. “Since that initial company, we now have fourteen companies in the federal market,” Wimberly says. “Goldbelt has approximately $300 million in revenue annually and about 92 percent of revenue and incomes comes out of the federal market.” Goldbelt has operations worldwide, and Wimberly says the majority of their government contracting takes place in the Lower 48 with a few offices internationally. The other 8 percent of Goldbelt’s revenue comes from Alaska operations, he says, “which includes Goldbelt Security in Alaska, tourism, and transportation.” He continues, “Now the challenge the board has laid out to me and the balance of management is to diversify our portfolio outside of federal contracting and grow the business in the Northwest as well as in Alaska. That doesn’t mean we’re going to stop or reduce the amount of federal contracting that we’re doing, we’re just going to look at a diversification portfolio in the nonfederal arena.” He says that Goldbelt is absolutely looking at diversification opportunities in Alaska: “Creating jobs in Alaska is our number one objective—creating jobs for our shareholders is our first and foremost objective.” In late December 2015 Goldbelt purchased a building in which to house its corporate headquarters, located at 3025

Alaska Business Monthly | September 2016 www.akbizmag.com

Toghotthele Corporation

The Toghotthele Corporation is an Alaska Native Village corporation representing the village of Nenana. Toghotthele President Bart Garber says that Toghotthele has a lot of high quality timber lands, “so it’s been a lumber company for some time.” Their other lines of business include civil construction and material mining, primarily sand and gravel. He says their recent projects have included “supplying materials and services, putting in roads for the city, maintaining roads for the FAA, and support services in gravel and material and civil services for oil and gas in the Nenana Flats.” He says activity in the Nenana Basin has been exploratory and has been going on the past ten years, and Toghotthele has provided services “most recently this last winter and summer at the Toghotthele #1 drilling site.” He continues that for that project they provided “material [including timber], roads, buildings, pads, and other types of support services.” Garber is a fairly recent addition to Toghotthele, as he took on the role as president nad CEO in July 2014. His work history includes being the CEO for Tyonek Native Corporation, of which he’s a shareholder, before he relocated to the Interior.

He says for the past two years Toghotthele has been in an “active pursuit” of new business—for the last year “actively looking inside and outside the state.” His previous work experience also includes government contracting, and he’s using that experience to find ways to participate in local government projects, for example at Eielson Air Force Base. “You have to bring some capabilities to that table, and we’re looking to leverage our own and potentially find partners that we can use to bring their skills to those projects.” In fact, he says, a significant partnership has been in the works. Garber says, “For the last year, formerly for the last six months [as of August], I’ve met with three of the closest villages to Nenana: Manley Hot Springs, Minto, and Stevens Village.” He says the boards for all four villages are working on resolutions to form a joint company to pursue development opportunities in the area. He says that the leadership of the four village companies has diverse experience, including backgrounds in law and business management, military service, defense agency auditing, accounting, politics, finance, real estate, and with Alaska Native Regional corporations. “The four of us together make a fairly strong management

DEPOSIT CHECKS FROM ANYWHERE Whether on-site or between meetings, Remote Business Deposit maximizes your efficiency. Make single check deposits using a mobile device and the Alaska USA app. Start using Remote Business Deposit today.

Federally insured by NCUA

SERVICES | LOANS | INSURANCE alaskausa.org/biz | (877) 646-6670 www.akbizmag.com

September 2016 | Alaska Business Monthly

ALASKA NATIVE BUSINESS SPECIAL SECTION

Clinton Drive in Juneau; up until that time the company had been renting a building. Goldbelt moved to its new location in March of this year after updating and renovating the building. VP of Alaska Operations McHugh Pierre says the building is a “great fit located in Vintage Business Park, where our neighbors that we do business with are located; it’s a great place to be and build synergy in the business community.” In terms of direct shareholder services, Wimberly says in the past year Goldbelt has increased their scholarships available through the Goldbelt Heritage Foundation, a 501(c)(3) nonprofit established for the support and continuation of the Tlingit art and culture community. “In addition we’ve created an Ancestral Trust for our shareholders that allows us to channel remaining earnings into the trust and make investments for the long term betterment of our shareholders,” he says. In February of this year Goldbelt’s Human Resources department, in partnership with the Southeast Alaska Tribal Health Consortium, held a job fair in Juneau to help locals connect with employment opportunities. Computers were set up on site to allow jobs seekers who had never completed an application online to do so with support and assistance on hand.

ALASKA NATIVE BUSINESS SPECIAL SECTION

team that you wouldn’t have otherwise if you were just a one-person shop.” Garber makes it clear that this is not a merger of the village corporations, but potentially putting new development into a joint company that could spin off, if successful, several subsidiaries. He says that leadership for the new company will be comprised of each of the four CEOs as well as one of each village corporation’s board members. All of the parent companies and legacy businesses will continue to operate. Garber continues, “I was pleasantly surprised [at the joint venture process]. Sometimes when you propose an activity like this people are protective of their turf, but in this case all of our boards promoted it and told us to move faster; they could see the way this increases our opportunities without spending more money and allows us to find a way to manage risk a little bit better. I’m very excited about moving forward in this model.” Garber says that Toghotthele today has 710 shareholders today and approximately 146,000 acres. The company is committed to providing jobs to shareholders and has “probably over 85 percent shareholder hire,” he says. “The normal course is almost 100 percent local hire, and that’s including managers,” Garber continues. Toghotthele has a standing scholarship committee that awards scholarships twice annually, and he says the corporation is continuously working with the village and city on community projects. “Most recently we provided material for a summer youth camp,” he says.

Afognak Native Corporation

Afognak Native Corporation is a merger of two Alaska Native village corporations, Natives of Afognak, Inc. and Port Lions Native Corporation. An Afognak spokesperson explains, “After the Afognak village was destroyed in the 1964 Good Friday Earthquake and Tsunami, tribal members relocated to build the village of Port Lions. Many also moved in to the City of Kodiak. Afognak Native Corporation started at 513 original shareholders in 1974; today Afognak Native Corporation has 1,074 Shareholders, with 678 (65 percent) living in Alaska. They own 248,000 acres of land on Afognak, Kodiak, Raspberry, Whale, and other small islands in the northern Kodiak Archipelago.” In addition to land, Afognak built and owns two buildings, the Afognak Center on Kodiak and the Alutiiq Center in Anchorage. On July 28 Afognak hosted the first annual Afognak Youth Charity Golf Tournament at the Anchorage Golf Course. According to 22

Alaska Business Monthly | September 2016 www.akbizmag.com

www.akbizmag.com

Eklutna, Inc.

Eklutna, Inc. is the village corporation for the village of Eklutna; it is the largest private landowner in Anchorage. BLM (Bureau of Land Management) conveyed ninety thousand acres with the 1971 ANCSA (Alaska Native Claims Settlement Act) within the municipality, including Eagle River, Birchwood, Chugiak, Peters Creek, and Eklutna. One of Eklutna’s exciting updates for 2016 is that the company is “on track for BLM to convey the majority of sixty-seven thousand acres in the Mat-Su this year,” says Eklutna CEO Curtis McQueen. While it’s a positive development, McQueen says

it does introduce a new challenge to the company: “There are people who have been hunting and fishing and living in that area for a long time, and we’re going to have to manage that.” He doesn’t think that most of those who use the area will see significant changes, but Eklutna is “going to ask people to clean up after themselves and we’re going to have to try to figure out how to stop more trails from being made. But on existing main thoroughfares we’ll probably just put some signs up and work with the state to communicate that better.” Eklutna is still owed approximately 17,000 acres of land on JBER (Joint Base El-

September 2016 | Alaska Business Monthly

ALASKA NATIVE BUSINESS SPECIAL SECTION

the company, “This past winter, the Afognak Leasing team raised funds and awareness for Dig Afognak Camp youth cultural activities. After this initial success, they decided to establish a golf tournament to take fundraising to the next level. Pulling from the team’s extensive experience in marketing and fundraising, with even a few avid golf enthusiasts, the Afognak Youth Charity Golf Tournament came to life.” After event expenses, sponsorship and tournament fees will benefit Afognak youth education programs operated by the Village of Afognak and the Native Village of Port Lions Tribes, such as the aforementioned camp, afterschool cultural activities, Alutiiq language lessons, and preschool activities. The company says, “These programs are an invaluable way for young people to learn the endangered Alutiiq language and to practice traditional harvest, survival skills, and healthy relationships. Tribally-led activities build a sense of pride, identity, and wellbeing in Alutiiq youth. Given the Afognak community’s traumatic history and socioeconomic challenges, it is important for Afognak Alutiiq youth to connect to the Afognak homeland and to practice healthy lifeways.” Additional shareholder services include $1.7 million in higher education scholarships since 2005, and “Afognak contributes 1percent of its adjusted comprehensive income each year toward cultural revitalization and community development initiatives,” according to the company. In its business lines, Afognak derives most of its revenue from government service contracts, with nongovernment revenue accounting for approximately 10 percent of the total. “Afognak Native Corporation, Alutiiq LLC, and their subsidiaries provide an exceptional track record of services in the government and commercial sectors worldwide, including leasing; construction; timber; engineering; security; logistics, operations and maintenance; oilfield; and youth services,” a company representative states. Recently the company has had significant growth recently in the number of shareholders in executive leadership, including five shareholder VPs, approximately 30 percent of the management team, according to the company. In May 2015 Afognak hired Dr. Alisha Drabek, former executive director of the Aluttiq Museum, to serve as senior VP of Community and government affairs; in October 2015, Howard Valley, who has provided more than thirty years of service in Afognak land stewardship, was promoted to VP of Lands; and in July of this year Jake Garner, formerly senior director of construction operations, was promoted to VP of Construction.

ALASKA NATIVE BUSINESS SPECIAL SECTION

Photo courtesy of Eklutna, Incorporated

Eklutna’s development Artillery Park located at Artillery Road and Mausel Street in Eagle River, which at press time still had some space available for tenants.

mendorf-Richardson). However, instead of focusing on the conveyance, McQueen says Eklutna has focused “more on what JBER means to the community and our national protection than Eklutna lands coming to it.” McQueen says that JBER is one of Eklutna’s strategic partners, in large part because JBER, the Municipality of Anchorage, the State of Alaska, and Eklutna are all bound by NALA, the North Anchorage Land Agreement, which was reached in 1982 due to the municipality and Eklutna having selected some of the same tracts of land under separate conveyance settlements with the federal government. McQueen says that over the years as JBER leadership has changed, “institutional knowledge was lost.” JBER issued this year a memorandum of understanding which says essentially “we all talk at the same time,” McQueen says. “If the city approaches JBER about something and forgets to approach us, JBER notifies us, and vice versa. It forces an open line of communication.” Another positive development this year in relations between the city and Eklutna is extending the overlay district that exempts lands in the village core of Eklutna from Title 21 regulations to the 143 acres adjacent to the village which were donated by Wells Fargo to The Conservation Fund in June 2014. Eklutna’s other recent efforts to build the Eklutna community include donating 1.5 acres of land to a Russian Orthodox Church to expand the land available to be used as a cemetery, as the previous cemetery grounds had essentially been filled. There were a few contingencies to the donation: that Eklutna help pay for a professional surveyor to line out what future plots would be, resulting in three hundred planned plots; that half of those plots would be retained for the Dena’ina 24

people; and that there would be no fee for the reserved plots (typically the church charges $1000 per plot). McQueen says, “It was important for us to support the church and religion, which some of the Dena’ina had converted to, but moreover take the stress [of the cost of burial] away from families.” He says in the last year and a half two Native elders passed away and were buried in the new area. Another project that’s taken root this year is removal of an eighty-year-old, seventy-foot dam that was constructed in the lower part of the Eklutna River that has negatively impacted salmon in the river. McQueen says the village has been advocating for the dam’s removal for years; The Conservation Fund’s Alaska State Director Brad Meiklejohn has coordinated with the village to move the dam removal project forward, and The Conservation Fund is serving as the project leader, coordinator, and fundraiser. Funds (all of which are non-state and nonfederal) to remove the dam have been raised, and McQueen says Eklutna’s newly-formed subsidiary ECM (Eklutna Construction & Maintenance) was selected to perform preconstruction services, which began in August. “This year a crane will be put up and it’ll lower equipment down and build access. Next year the dam removal will happen,” McQueen says. This year Eklutna also completed work on the renovation of the health clinic, a two-phase project: Phase I replaced the existing clinic with a new facility to provide basic healthcare, behavior and mental health services, and dental care. The vision for Phase II is to construct a new gathering place for cultural events, community activities, and meetings. “The big exciting story for this year is the clinic, burial grounds, and now fish,” Mc-

Queen says. “Eklutna, as a for-profit corporation, has been able to pay it forward. We do need to make money as a corporation, but often we’ll take that money and we’ll turn it back into what benefits the culture.” On the corporate side, last year Ekluna finished construction of Artillery Park, a commercial development in Eagle River for retail, restaurant, medical, office, or industrial tenants. Completed in August of 2015, the development already has three tenants, according to McQueen: Odd Man Rush Brewing; Eklutna’s contracting group; and Pacific Rim Athletics, a gymnasium space that has equipment for American Ninja Warrior training. McQueen says Eklutna is in talks with additional companies that may absorb the rest of the space. In October of 2014 Eklutna’s subsidiary ESL completed the development of Powder View, a residential development in Powder Reserve. McQueen says there are thirteen lots remaining for purchase in Powder View. In late 2010 the Anchorage School District purchased approximately fifteen acres within Powder Reserve for development of a new elementary school in Eagle River. ECM won a contract this year to remodel the FBI building located in Anchorage. The remodel is intended to strengthen the building’s outer walls to withstand being rammed by a motor vehicle as well as renovations inside the building. Eklutna owns the land on which the building stands. At press time ECM was working on Phase I of the three-phase project with an estimated completion in 2017. R

Tasha Anderson is the Associate Editor for Alaska Business Monthly.

Alaska Business Monthly | September 2016 www.akbizmag.com

SPECIAL SECTION

Alaska Native Business

Ahtna and Michelle Anderson

©Judy Patrick Photography

Michelle Anderson, Ahtna, Incorporated’s President and an Ahtna shareholder, in their Anchorage office.

One Team, One Ahtna focusing in on Alaska By Tasha Anderson

n the Spring 2016 “Ahtna Kanas,” a quarterly publication by Ahtna, Incorporated, the company spotlighted subsidiary Ahtna Facility Services, Inc. (AFSI). AFSI was established in 2006 and provides janitorial, facilities operations, and security guard services. AFSI won a contract to provide janitorial services on JBER (Joint Base Elmendorf-Richardson). The spotlight says, “Ahtna shareholder-owners Arthur Stevens, assistant project manager, and Valerie See, day supervisor, are part of a team that leads the janitors and floor technicians, all of whom had to pass thorough background checks and flight-line training to gain access to the military installation.” Ahtna Netiye’ CEO Tom Maloney says, “The first thing we like to stress is we’re Alaska-based. We’re an Alaska Native Cor26

poration, we’re based in Glennallen, we have a lot of operations around the state. Our business was up 40 percent in the state of Alaska in 2015, and Alaska revenues are continuing to grow significantly in 2016.” Ahtna, Inc.’s President Michelle Anderson adds: “That was a board decision—that was a strategic decision to focus in on Alaska.” She continues, “Government contracting came in during the 90s and that was the place to be, and we’ve proven we’re successful at that, but our shareholders aren’t moving to where we have those contracts; they want to be here at home.” AFSI has more than 150 employees around the United States and headquarters in both Alaska and California, allowing them to service a variety of markets; however, securing a contract such as the one on JBER is an opportunity for jobs for Ahtna shareholders here in Alaska, where they want to be.

Focus on Development

Anderson herself is an Ahtna shareholder and was the youngest person to serve on Ahtna’s board, running and being selected in her first year of college. “I think it was and has always been Ahtna’s way to try and bring

our younger people, our young potential leaders, into leadership training,” she says. In Anderson’s case, it certainly paid off. She grew up in Glennallen, completing all of her pre-college education in the Copper River School District. After getting her diploma she attended UAA and received an undergraduate degree in Political Science and then went on to UAF, getting a master’s in Rural Development. “My work background is a mix of state and federal opportunities that prepared me for the position that I’m in today,” Anderson says. She volunteered for the Tony Knowles campaign and then secured a position in the Alaska State Community Service Commission when Knowles was elected governor. During Knowles’s second term she moved into a position with the Denali Commission, “which just blew the doors off my education on infrastructure development and the need for government coordination for making these projects happen,” Anderson says. Between the two positions she traveled widely across the state. “It developed my sense of how to bring different parties together to work on development from ground zero and then

Alaska Business Monthly | September 2016 www.akbizmag.com

‘One Team, One Ahtna’

Ahtna’s new structure wasn’t just on the surface; Ahtna was also reworking its internal workings. “My initial assignment was basically to implement or streamline policies and procedures across the companies, which sounds easy enough, but it was a major effort,” Anderson says. She likens

Ahtna’s growth to building a house: one starts small and makes additions, tears down walls, or shuts off a room as necessary. “We never really had an opportunity to start with a clean slate and enhance our internal functioning, as well as how we deal with the public, our external communications, our public image, our interaction with the community.” She says a large part of Ahtna’s focus was to become an employer of choice, to be a company that anyone, shareholder or not, would want to work for. In order to promote this type of work environment, Anderson says, the board does not promote internal competition among employees or subsidiaries. “Our whole incentive structure has been developed to reward the success of all of our companies, to reward the success of teams working together, and to look at the individual contribution or how an individual performs. Our traditional values have taught us that success is achieved by working together and that we are stronger as One Team, One Ahtna,” Anderson explains. “That’s one of the programs that we overhauled to have a very formulaic way of being able to explain every reward,” whether that reward was given to an employee, a team, or a company. Maloney adds, “There are firm guidelines. It’s not based on subjective things, but overall measurements.”

He continues, “One of our biggest things is, if we’re not providing employment opportunities for our shareholders, we’re not doing much of anything.” Anderson adds emphatically, speaking of Ahtna’s approximately 1,950 shareholders, “It’s their company.” Maloney says that while profitability matters, shareholder development opportunities are vital.

Creating Opportunities

Ahtna manages approximately 1.5 million acres, not counting 622,000 acres located within Denali National Park and the Wrangell-St. Elias National Park and Reserve. The Ahtna region “encompasses the Copper River Basin and the Wrangell Mountains and is bordered by the Mentasta and Nutzotin Mountains to the northeast, the Alaska Range to the north, the Talkeetna Mountains to the West, and the Chugach Mountains so the south,” according to the company. Ahtna is very interested in working with other world class companies to safely develop their rich natural resources. “If there’s a major development that’s going to happen in Alaska, it’s going to come through our region,” Anderson says. In fact fifty-five miles of TAPS, Alaska’s iconic mega-project, runs through Ahtna lands. Anderson explains that Ahtna was not paid an upfront sum and does not receive any ongoing payments for the land TAPS is

PRL Logistics, Inc. PROVEN PERFORMANCE — Alaskan Expertise—Global Resources — Safety & Environmental Services — Project Management Services — Air, Land, Marine & Rail — Remote Site Logistics — Logistics Solutions

Ron Hyde, President & CEO AOGA 2016 Contractor of the Year Award for Safety Performance

421 W. 1st Ave, Suite 250 I Anchorage, AK I Ofﬁce: 907.261.9440 I pacrimlog.com Locations in I Anchorage I Kenai I Deadhorse Your Lodging & Logistics Campus on the Kenai River thecannerylodge.com www.akbizmag.com

September 2016 | Alaska Business Monthly

ALASKA NATIVE BUSINESS SPECIAL SECTION

putting different mixes of funding together to help bring projects to reality.” Anderson transitioned to Ahtna in July 2005 as the VP for Ahtna Development Corporation. She says she was drawn to the company when then-Ahtna Development Corporation President Pamela Finnesand explained that instead of focusing on government contracts, she wanted Anderson to focus on development in the region. “Those were the words I needed to hear,” Anderson says. After a short break in service when Anderson worked for the Alaska Native Tribal Health Consortium, Anderson became Ahtna’s president in October 2011. Ahtna at the time had just undergone what Anderson calls a “major reorganization.” Ahtna had created a holding company, Ahtna Netiye’, which “manages all of our operating subsidiaries.” Her role, then, would be to work with the Ahtna board and provide oversight and monitoring of the holding company.

ALASKA NATIVE BUSINESS SPECIAL SECTION

on. “Having said that, Alyeska Pipeline has been a valued partner of Ahtna’s since before the pipeline construction even started, so our construction group has worked with Alyeska for more than forty years. Ahtna has far and away the highest percentage of Alaska Native shareholders working on the pipeline compared to any other company, so it has created some good employment opportunities for some shareholders,” she says. Anderson and Maloney are clear that they support plans for the AK LNG project, but that terms for the roughly thirty-eight miles of AK LNG line that would run over Ahtna lands would be different than with TAPS: Ahtna must be fairly compensated, just like any other landowner would be in the situation. “We also believe that we should have shareholder preferences as far as hiring people to do work,” Maloney says. “Lots of activities will happen with an AK LNG line, and we love the project. We really want to see it go, but the thing we’re always looking for is work opportunities for shareholders.” One way the company is taking the lead to create those opportunities is the Tolsona Oil

At press time Ahtna was planning to mobilize a drilling rig in mid-August for exploratory drilling. “We should know in about early October what’s going on, what we have there,” he says. Ideally the project would not only provide jobs within the region, but would also provide a cheaper source of fuel for shareholders, making it easier to live in the region. Anderson says, “If we are successful out there, it is going to completely enhance and give a boom to the economy. We are dealing with extremely high energy costs, and the state is dealing with their own fiscal crisis. … We have people that are going to have to make some hard choices: are we going to pay for fuel in September or are we going to buy our kids’ school clothes? If we can lessen the burden of living in the region and lower the cost of energy, that’s the number one goal.” In February this year Ahtna acquired AAA Valley Gravel, a sand and gravel mining, trucking, and asphalt operation. Anderson says its purchase was also in an effort to focus on supplementing or enhancing Alaska operations. In Maloney’s “CEO’s Message”

cifically developed to address the subsistence needs of the Ahtna people started with one Ahtna hunt group and a certain number designated of moose and caribou for the hunt. Today it’s more than seventyfour hunt groups coming in from all over the state, so we are bracing ourselves for three thousand hunters who don’t live in the area to go after those same one hundred moose that we’re going after. It’s insane.” This highlights one of the unique issues that Ahtna faces, the double edged sword of being located on the road system. As Maloney puts it, “The good point is our land is accessible by road; the bad news is everybody trespasses on our land because it’s accessible by road.” Further, ANCSA has only been in effect since the early 70s: much of the state’s development took place before that and caused significant problems that haven’t been fully addressed. For example, Anderson explains that near Gulkana there are graves all around areas where the state allows access for fishing and camping. “Fences have been taken down from around those graves and used for firewood. I’m not saying everybody that uses

“Lots of activities will happen with an AK LNG line, and we love the project. We really want to see it go, but the thing we’re always looking for is work opportunities for shareholders.”

—Tom Maloney, CEO, Ahtna Netiye, Inc.

& Gas Project. The state issued a license to Ahtna in 2013 for exploration on forty-four thousand acres of state land located ten miles west of Glennallen. The company states, “In 2014 Ahtna completed forty miles of 2D seismic exploration which provided very positive data resulting in identification of a distinct oil and gas structure one mile north of the Glenn Highway.” Originally Ahtna only had a one third interest in the project, Maloney says. As the other two interested parties backed out, Ahtna made the decision to take on the entire project “because of the importance of developing in the area.” He says that typically large companies do not take on 100 percent of their developments, but “that’s the difference: the board saw that development interests shareholders, even though it maybe increases their financial risk profile.” Anderson agrees: “It gets back to our mandate—using our resources to benefit our shareholders. We don’t want to just sit on what’s out there.” The project has already been positive for shareholders, proving opportunities for jobs during exploration. “Thus far on the project, as far as big physical work, we put in a roughly 1.7 mile road and a large pad for the drilling rig,” Maloney says, adding that for those projects approximately two thirds of the employees were shareholders. 28

in the Spring 2016 “Ahtna Kanas” he said, “Federal highway monies are scheduled to increase in Alaska every year for the next five years, and Mat-Su is a prime area for increased highway spending due to its rapid growth.” The acquisition is already fulfilling its purpose. Maloney says an Ahtna shareholder is running AAA Valley Gravel’s operations. “The goal and the intent is that we’d like Ahtna shareholders running everything, and these are role models for our youth.”

‘Our Cultural Identity’

Anderson says, “I’m Athabascan, so I was raised in and around the Ahtna Athabascan culture. The values that we talk about today are values I was raised with. I believe in what I talk about because I was raised up in it, I understand it, I get it.” She’s passionate about other Ahtna shareholders getting into leadership positions as they too will have this vital perspective. “We understand the value of money and that we have to make it, but also the value of our traditional hunting rights and fishing rights—those are just as important if not more so,” she says. She says a critical issue Ahtna is currently working on is that at present all licenses to hunt or fish on Ahtna land are issued by the state. “We have a major hunting crisis coming up this year. A hunt that was spe-

that area has bad intentions; I’m saying that over the course of forty to sixty years many of these graves have been desecrated,” Anderson says. She says the governor recently made a visit to the site, and Ahtna has committed to developing a completely removed but accessible area, including a parking area and related facilities, in exchange for giving these sacred lands and cemetery back to the village of Gulkana. While current talks are positive, Anderson says, that’s just one example of a village that was “divided or disregarded when development was happening here in Alaska.” Ahtna is committed to maintaining its defining culture while moving forward with development and opportunity. Anderson says, “We don’t ever want to lose the Ahtna part of us. We will support and we will be very protective of those aspects of our culture that make us different from everyone else. That includes our hunting and fishing, how we use the lands, our sacred areas, our language, and educating our younger people, not just with Western education but with our cultural education. Our cultural identity is integral to who we are as a member of the business world.” R Tasha Anderson is the Associate Editor for Alaska Business Monthly.

Alaska Business Monthly | September 2016 www.akbizmag.com

Commercial Insurance Employee Benefits Personal Insurance Risk Management Surety

SPECIAL SECTION

Alaska Native Business

ANSEP Success Graduates engage, motivate, and teach By Rindi White

program that began twenty-one years ago as a scholarship for one student has today branched out to become a multi-phased effort to increase the number of Alaska Natives in STEM (science, technology, engineering, and mathematics) fields. The Alaska Native Science & Engineering Program, or ANSEP, charts success on several different fronts, but perhaps the most notable is that two program graduates last fall became the first Alaska Native professors of engineering at the University of Alaska Anchorage.

Alaska Business Monthly | September 2016 www.akbizmag.com

Chelsea Malstrom and Michael Ulroan get hands-on experience conducting Alaska wildlife research during a paid internship with the US National Oceanic and Atmospheric Administration. ÂŠ Chris Arend chrisarendphoto.com/ Courtesy of ANSEP

www.akbizmag.com

September 2016 | Alaska Business Monthly

ALASKA NATIVE BUSINESS SPECIAL SECTION

Summer Bridge student Randall Friendly heads to the bank of Karluk Lake on Kodiak Island, where he participated in a paid internship with the US Fish and Wildlife Service as a brown bear researcher. Â© Chris Arend chrisarendphoto.com/ Courtesy of ANSEP

Alaska Business Monthly | September 2016 www.akbizmag.com

The Secret to Success: Gain Interest Early Before finishing his doctorate, Calhoun worked with ANSEP for two years recruiting

www.akbizmag.com

students and traveling to different villages. “I’d build computers with the students and use it as an incentive to get them to take trigonometry and calculus,” he says, so they’d be academically prepared for college. ANSEP started as a university-level scholarship program in 1995, which evolved into a Summer Bridge program for high school students who were headed to university. Now ANSEP engages thousands of middle school and high school students in residential STEM programs. “What we’ve been finding is, the earlier the better,” Calhoun says. “Looking at how Alaska ranks against other states with testing scores and performance, I believe the Department of Education ranks Alaska second to last. But we spend the most. We’re spending all this money, but we’re still at the very bottom.” ANSEP is trying to change that through early engagement, early awareness and excitement about the opportunities of careers in STEM fields, and social engagement for the students. The program holds multiple Middle School Academies each summer, to which they bring in about fifty students per Academy in grades six through eight for a twelve-day residential campus experience, Bourdukofsky says.

“They’re here for twelve days, living like college kids, getting a feel for life as a college kid, and they’re engaged in a variety of hands-on STEM activities,” he says. The students assemble their own desktop computer and then use the computer throughout the twelve-day program. “Ultimately the kids get to keep those computers; they agree to finish Algebra I by the end of eighth grade,” he says. The students can come back and do several five-day programs, from building a drone and having it pick up and drop off a payload to a variety of healthcare related activities and energy related activities. “Our goal, ultimately, is to keep them developing their math and science skills and help them understand how those skills are used and how they’re related to a variety of science and engineering paths,” Bourdukofsky says. The programs are also designed to build teamwork and communication skills, he says. This summer alone, ANSEP engaged with more than 350 middle school students from across the state.

Acceleration Academy Gives STEM Students a College Boost High school students are invited to take part in ANSEP’s Acceleration Academy, a five-week residential program through

September 2016 | Alaska Business Monthly

ALASKA NATIVE BUSINESS SPECIAL SECTION

Matt Calhoun and Michele Yatchmeneff both began teaching at UAA last fall. Both continue to engage with ANSEP, helping motivate other undergraduates, middle school, and high school students to pursue careers in STEM fields. Seeing their success has been a boost for the program, says Chief Operations Officer Michael Bourdukofsky. “It’s really exciting for us to see their success, because it was a huge motivating opportunity for us. If these guys can do it, we can do it, too,” he says. “I know it was hard for them to leave home to finish those PhDs, but it’s paid off for them now, as faculty.” Calhoun and Yatchmeneff help with ANSEP’s summer activities, Bourdukofsky says. They lead activities for middle school students, teach introductory engineering courses to high school students, and, at the university level, are teaching classes to all engineering students while also acting as mentors for current ANSEP university students. “I think they both have done a fabulous job of committing to go all the way,” Bourdukofsky says.

ALASKA NATIVE BUSINESS SPECIAL SECTION

which students can take college-level math or science courses and gain college credit. “We’ve seen students who come back every year who are finishing all the math they need for an engineering or science degree by the time they’re done with high school,” Bourdukofsky says. This summer, ANSEP engaged more than 130 high school students through the Acceleration Academy.

ANSEP students, staff, family members, and guests celebrate their cultural traditions through Alaska Native dance at the annual ANSEP Celebration. © Chris Arend chrisarendphoto.com/Courtesy of ANSEP

Coursework and Employment Opportunities Gives Perspective ANSEP’s Summer Bridge program is a ten-week program for graduating high school seniors that provides them with another college-level math class, plus an internship experience with one of ANSEP’s numerous partners. “We partner with BP, ExxonMobile, ConocoPhillips, state and federal agencies including US Fish and Wildlife, the US Forest Service, USGS [US Geological Service], and BLM [Bureau of Land Management], just to name a few,” Bourdukofsky says. Giving the students an internship opportunity helps them gain a practical perspective of the classroom skills they are learning, he says. Building Relationships, Promoting Opportunities, Providing Advice One of the most robust programs ANSEP offers is to undergraduates, Bourdukofsky says. “Once they’re in degree programs, we support those [STEM] students in a variety of ways. We have weekly meetings so they’re engaging with their peers; we promote opportunities within our partner organizations. We also support students through weekly study sessions for their math, science, and engineering courses. We have academic advising and financial advising to make sure students are on top of the school’s requirements,” he says. “If the students are actively engaged with our program, semester after semester, they’re eligible to apply for scholarships as well.” Bourdukofsky says scholarships are only available to students who have been actively involved in ANSEP pre-college components and with the university component for two consecutive semesters. It was the on-campus support that helped Calhoun cement his future in engineering. He grew up in Homer, finished high school at Dimond High in Anchorage, and joined the Coast Guard because he lacked the money to attend a traditional college and also because he was recruited for his swimming ability. But he was dissatisfied with the rigorous regimen and the abundance of rules in the Coast Guard and felt lonely thousands of miles away from his family. 34

He returned to Alaska for the summer and spent it commercial fishing on the Lower Cook Inlet with his family. In a break between fish runs, he traveled to Anchorage to “poke around” UAA and see if he could find anything enticing there. It was summer and the campus was quiet, but he happened to meet Herb Schroeder, the founder of ANSEP. “That was in July; a month later I was registered for classes,” Calhoun says. He had a roommate—another ANSEP student— who was also in several of his classes. That roommate and many of the other students in ANSEP’s program at the time remain some of Calhoun’s best friends, he says. Calhoun didn’t pursue his PhD in a straight line. In fact, fearing public speaking, teaching was never something he thought he would do. He pursued a Civil

Engineering degree at UAA and, as ANSEP requires, worked internships with ANSEP partners each summer. The following year, students gave presentations about their internships at Friday group meetings. Giving those presentations helped him become more comfortable speaking in front of people, he says, and now he’s able to do so confidently in front of his fifty to sixty students. After earning his bachelor’s degree, Calhoun worked for a small construction company as a field and project engineer. Working with younger ANSEP students throughout his undergraduate studies, Calhoun jumped at a chance to be the program’s pre-college director, recruiting students for summer programs. He worked with ANSEP for more than two years before leaving to focus on his doctorate.

Alaska Business Monthly | September 2016 www.akbizmag.com

Hard Work Is Paying Off in Better-Prepared Students ANSEP’s focus on providing a STEM-focused learning community that reaches out to students at a young age is paying off, Bourdukofsky says. He says nationally, about 26 percent of students complete Algebra I by the time they finish eighth-grade. Among ANSEP students, that number is 77 percent. “At a minimum, if a student gets through Algebra I by eighth grade, they should be

able to finish calculus by high school graduation. If they don’t, they’ll maybe get through trigonometry, which is still OK, but if a student is interested in a science and engineering program, getting through calculus is a huge step,” Bourdukofsky says. No school district in Alaska requires four years of high school math, he notes. Among Acceleration Academy students, he says, 95 percent who have taken an ANSEP course successfully advance a level or more in math and science. At the university level, Bourdukofsky says, ANSEP tracks graduation and retention rates for active ANSEP students. Seventy-five percent of those students either graduate college or are currently still on track to graduate. The success rate continues after college, he says, although that information is informally tracked. “Almost every ANSEP student who graduates gets a job or continues on with their education in terms of grad-level studies. If anybody doesn’t get a job, they’re likely making a conscious choice not to,” Bourdukofsky says. “Because one of the requirements we have of our students is that they have to work an internship every summer; they continue to build professional connections through those internship experiences and maintain an idea of how they want to

apply their degree some day.” What sets ANSEP apart from other programs, Bourdukofsky says, is that it seeks to bridge higher education and industry. “You have the K-12 system, which is working to prepare kids for college or a trade. You have universities preparing students for higher education and jobs. And you have science and engineering industry employers,” he says. “ANSEP is really at the epicenter. Bringing all these entities together to prepare the workforce of tomorrow is a cool thing to see.” Having industry partners helps ANSEP students obtain gainful employment, he says. “People who are highly educated and trained in technology or science-heavy career paths typically have more opportunities upon receiving that kind of training,” Bourdukofsky says. “From an ANSEP standpoint, that’s a bonus, but it’s also focusing on the lack of Alaska natives and minorities and the lack of females in those industries. There are a lot of positives from what our goals are and what we’re doing,” Bourdukofsky says. R Rindi White is a freelance journalist living in Palmer.

TRAVELING TO A MEETING OR CONVENTION? SHARE YOUR LEAD WITH OUR TEAM.

907.257.2349 | meet@anchorage.net www.akbizmag.com

September 2016 | Alaska Business Monthly

ALASKA NATIVE BUSINESS SPECIAL SECTION

In order to have a chance to work in the University of Alaska system, Calhoun needed to go outside—standards dictate that professorial candidates should have a broader range of experience than just at the university they seek to teach in. After completing most of his schooling at the University of Colorado Boulder, he finished up at University of Alaska Fairbanks to be closer to his growing family. He was hired last fall and, after having defended his dissertation the first week of August, started teaching the same week in Anchorage. Calhoun says he only recently realized that he and Michelle were the first Alaska Native professors in the College of Engineering. “It’s kind of too bad it took this long, but my goal is to help make more,” he says.

SPECIAL SECTION

Alaska Native Business

Revisiting ANCSA: Mike Gravel

Courtesy of Mike Gravel

President Richard M. Nixon signing the Alaska Native Claims Settlement Act, December 18, 1971.

Former Alaskan statesman reminisces By Shehla Anjum

n a memorable photograph from the 1970s, Mike Gravel sits astride the trans-Alaska oil pipeline looking proud and confident about Alaska’s coming oil bonanza and the economic security that would accrue to the state. Gravel, a Democrat, was in the United States Senate at the time. He served two terms from 1969 until 1981, along with Ted Stevens, a Republican. It is fair to say that more Alaskans know about Stevens, who died in a plane crash in 2010. But Gravel’s service is also important and it came at a crucial juncture in the state’s history. He recently came back to Alaska to speak about his leadership in securing Congressional authorization to build the oil pipeline. While here, Gravel met former staff and old friends. He also spoke to Alyeska Pipeline Service Company employees about the pipeline that they oversee. 36

Gravel, now eighty-six, harbors no resentment that most Alaskans do not know how the pipeline came about. He knows that Alaskans understand that the Trans Alaska Pipeline System (TAPS) is the state’s most important asset. He wants to set the record straight about what he did to help make it happen. “I am proud of my role in bringing about the pipeline, and I want that history to be accurately understood,” he says. “For a period of time I was the only one kept alive the hope of getting it authorized through Congress and which from my point of view seemed simple,” although others disagreed, sharply, at that time. That was in 1973, when the construction of the pipeline was mired in lawsuits. Gravel felt that Congress, bogged down in politics, was not moving to take care of the problem.

Looking for Success

Like others before him, Gravel came to Alaska to find success. He arrived in August 1956, shortly after obtaining a BS in economics from Columbia University in New York City. Gravel had previously served in the US Army Counter Intelligence Corps and as Adjutant for the Communications Intelligence Service.

While attending Columbia part-time, Gravel worked full-time on Wall Street and later drove a taxi in Manhattan. He researched locations to launch a political career. “I was ambitious and decided to go to Alaska and stay there until I succeeded.” Gravel endured an arduous journey up the Alaska Highway, which was no more than a dirt road in those days. But he didn’t mind. “I felt the travail was no big deal because I had a strong sense of awareness and awe that I was on my way ‘home’—even though it was a home that I had never seen before. I never had a change of heart from that first experience.” He still considers Alaska his real home. It took him only a day after arriving in Anchorage to land a job selling real estate at Northern Realty, a local firm. Anchorage was still a small town with only two paved streets—Fourth and Fifth Avenues. But Gravel felt at home, settled down, and started planning his next steps. He sold real estate for a couple of months, but when winter set in the real estate commissions dried up. “I had made some good sales but I wasn’t provident in saving money. So I got a job as a brakeman with the Alaska

Alaska Business Monthly | September 2016 www.akbizmag.com

ALASKA NATIVE BUSINESS SPECIAL SECTION

Railroad. I had an edge in getting that position because the railroad was then under the US Department of Interior and I was a veteran.” He worked on the Anchorage to Fairbanks run, including the winter snow fleet. A few months later, by spring 1957, Gravel had had enough of the railroad. He got his real estate brokers license, became a solo realtor, and entered the world of politics in Anchorage. He became involved with the Young Democrats and was soon elected as its president. He embarked on a calculated trajectory to get ahead in politics. “In advertising for my real estate work, I advertised my name so that it became known, which also helped my political career.” His strategy worked. He plunged into local politics and within a couple of years ran for his first political office. “I ran for the Territorial Legislature [1958] and lost, then I ran for the Anchorage city council and lost. In 1962 I ran for the state Legislature and won.” Alaska had become a state by then. He served two terms in the Legislature (1963-66), and was speaker of the house in his second term (1965-66). While he was speaker, Gravel organized a trip for the Legislative Council to remote rural villages to survey economic conditions, particularly schools. Rural poverty and the emotional stress on families of having to send children to high schools in the Lower 48 left a deep impression on Gravel and the other legislators. Out of that trip came a successful statewide bond issue to expand the state’s educational system, including regional high schools. Although only one school was built at that time, the idea of state responsibility for education of rural Native children had been firmly planted through Gravel’s initiative. Today there are several regional boarding high schools in the state.

OUR PEOPLE. OUR REGION. OUR DECISION. “WE NEED JOBS” “NO ARCTIC DEVELOPMENT”

“HANDS OFF THE ARCTIC”

Quest for National Office

At the end of his second state legislative term Gravel began his quest for national office, running for the US House of Representatives seat held by Ralph Rivers. He lost that election by a narrow margin. Nevertheless, support from the rural Native community in that race signaled an awakening of political power. In 1968 he ran for the US Senate against Ernest Gruening and was elected in an upset campaign, serving two terms in the Senate (1969-81). Gravel’s years in the US Senate coincided with major issues important to Alaska, including the settlement of the Alaska Native land claims and construction of the transAlaska oil pipeline. When Gravel went to the Senate in 1969, the land claims struggle was just beginning and the Alaska Federation of Natives (AFN), organized in 1966-67, was working on securing a settlement by Congress rather than pursuing a lawsuit through the Court of Indian Claims, a lengthy process. Gravel worked closely with www.akbizmag.com

Decisions affecting Arctic Alaska must remain in the hands of those who call it home.

OUR VOICE. OUR VISION.

ARCTIC SLOPE NATIVE ASSOCIATION ARCTIC SLOPE REGIONAL CORPORATION ATQASUK CORPORATION CITY OF ANAKTUVUK PASS CITY OF ATQASUK CITY OF BARROW CITY OF KAKTOVIK CITY OF POINT HOPE CITY OF WAINWRIGHT ILISAGVIK COLLEGE

KAKTOVIK IÑUPIAT CORPORATION NATIVE VILLAGE OF ATQASUK NATIVE VILLAGE OF POINT HOPE NATIVE VILLAGE OF POINT LAY NORTH SLOPE BOROUGH NUNAMIUT CORPORATION OLGOONIK CORPORATION TIKIGAQ CORPORATION UKPEAGVIK IÑUPIAT CORPORATION WAINWRIGHT TRIBAL COUNCIL

September 2016 | Alaska Business Monthly

Courtesy of Mike Gravel

ALASKA NATIVE BUSINESS SPECIAL SECTION

Alaska Native leaders in getting a fair settlement. Oil had been discovered on the North Slope, and a land settlement with Alaska Natives was needed in order to facilitate the pipeline construction. Gravel encouraged an alliance between the Natives and industry. “I co-authored and co-sponsored the Alaska Native Claims Settlement Act [ANCSA] legislation along with Ted Stevens, under the leadership of the Interior Committee Chairman Senator Henry ‘Scoop’ Jackson of Washington state. I provided leadership for two key elements of the legislation,” Gravel says. The first was the question of how much land Alaska Natives would receive as part of the settlement. “It started out with a hundred thousand acres, went up to a million acres, then 2 million acres, but it never really got off the ground.” Gravel was the first Alaska leader to support Native leaders with a larger land settlement. “They [AFN] want 40 million acres and to me that sounds like justice,” Gravel told Alaska newspapers at the time. Alaska’s politicians and its business community did not greet that statement with enthusiasm. However, Walter Hickel, then governor, also followed Gravel and came out in favor of 40 million acres and that locked in the number. The final settlement was 44 million acres and $963 million in a cash settlement, with land and money divided among the new Alaska Native corporations. Gravel’s second contribution was that money and land that went to the Native corporations would not be subject to US Bureau of Indian Affairs control as would have been the case with financial awards through the Court of Indian Claims. The cash, however, was dependent on resource revenues—oil. Gravel made a unique contribution in moving the trans-Alaska oil pipeline forward. Once completed and in operation, the pipeline opened the road to the prosperity most Alaskans enjoy today. Many people have assumed that Ted Stevens had a significant

Letter from Alyeska Pipeline Service Company President E.L. “Ed” Patton.

role in getting authorization for the pipeline. Gravel says that was not the case, and he has a letter from then-Alyeska President Ed Patton to prove his case. “If I hadn’t taken the initiative to introduce an amendment to Jackson’s bill in Congress, the pipeline might not have been built, or at a minimum it would have been delayed several years beyond its projected start date,” he says.

“I’m not talking about years. I’m talking about generations.” People who know, know BDO.SM BDO can work with your business to develop a wide range of economic projects. Our dedicated professionals offer a range of strategic and analytic solutions, including audit and tax consultation and specialized tax services, to help grow your business and achieve long-term results. BDO USA, LLP 3601 C Street, Suite 600, Anchorage, AK 99503, 907-278-8878 Accountants and Consultants

www.bdo.com

Alaska Business Monthly | September 2016 www.akbizmag.com

www.akbizmag.com

Joint House-Senate Atomic Energy Committee about the dangerous US reliance on Middle East oil. Gravel encouraged the staff member to privately brief all other senators and then quietly began to lobby those senators for support for the Alaska pipeline. By May 1973 he had twenty-five senators who agreed to vote “yes” if the amendment came to the floor. With the twenty-five votes secured, Gravel convinced the oil companies to back his amendment. “Only then,” he says, “did the oil companies pull off the pressure against me.” The oil companies soon garnered the support of Richard Nixon’s White House.

Gravel acknowledges this was a difficult issue for Scoop Jackson, who had authored the National Environmental Policy Act of 1969 and now opposed the Gravel amendment, in 1973, to exempt the trans-Alaska oil pipeline from NEPA, its first big test. With the White House now behind it, the amendment went to the Senate floor. Gravel had worked behind the scenes to secure its passage and never gave a single public speech in its favor. The Senate’s 5050 tie vote was broken by Vice President Spiro Agnew. Soon US Representative John Melcher of Montana secured a positive vote in the House and in a few months, Congress

September 2016 | Alaska Business Monthly

ALASKA NATIVE BUSINESS SPECIAL SECTION

Pivotal Year: 1973

In early 1973 the Alaska Native land claims were settled, but the pipeline was still mired in lawsuits, holding up construction. Nearly $300 million had been spent on studies to address concerns raised by environmental groups, but Congress wasn’t taking any action. “We had gone through years of study and judicial delay. I was getting briefed and was well aware that we had substantial knowledge and the technology to build the pipeline properly,” Gravel says. “In February [1973] Senator Jackson introduced what amounted to technical legislation to expand the right-of-way for a pipeline, but there was no plan for construction because that was being held up in the courts. So I took it upon myself to do something.” What Gravel did next was gutsy. The National Environmental Protection Act (NEPA), under which various environmental lawsuits had been filed, had caused the delay. “I realized that if Congress authorized the construction under NEPA we could proceed to build it. But at the time, all I thought I was doing was advancing the date of construction,” he says. In retrospect, Gravel realizes that the situation was “more serious and that we might never have built the pipeline had we not proceeded at that point in time.” The litigation might have lasted several more years and Congressional leaders, including Jackson, were much influenced by the “ascendancy of the environmental movement and would have dragged their feet. So I filed my amendment,” Gravel says. Not long after Jackson had introduced his legislation in February 1973, Gravel invited Ted Stevens to co-sponsor his amendment to authorize construction. Gravel’s amendment aroused the ire of Senator Jackson, and the powerful senior Senator and chairman of the Interior Committee asked Ted Stevens to withdraw his support. Stevens was close to Jackson at the time, says Gravel, and did as asked. The entire political and economic leadership of Alaska opposed Gravel’s amendment, including the oil companies who “also asked me to withdraw the amendment.” Gravel thought Jackson was feeding the oil companies and Alaska a line. Jackson was running for president and was counting on environmental groups for support. “For the next few months the oil companies used their influence in Alaska to pressure me to withdraw my amendment. They thought I was making a mistake, [then-governor] Bill Egan publically opposed my amendment, as did the state Chamber of Commerce, the state’s labor movement, and the Legislature. Anybody and everybody was opposed to my amendment. They all said that I was wrong and that Jackson was the guy who was going to deliver the pipeline.” But Gravel would have none of that. He had been briefed by a staff member of the

ALASKA NATIVE BUSINESS SPECIAL SECTION

the delegation to ask Gravel to withdraw his amendment and subsequently led to the construction of the eight hundred-mile pipeline. “It was a private letter that acknowledged what I did, saying I was the lone vanguard for moving the pipeline forward. And during that period, the oil companies were not,” Gravel says. Gravel presented the letter and the photo of himself astride the pipeline to Alyeska Pipeline Service Company and its employees last spring. It is part of his legacy.

Courtesy of Mike Gravel

Mike Gravel sits astride the transAlaska oil pipeline.

had passed the Trans-Alaska Pipeline Authorization Act. It was signed by President Richard Nixon in November 1973.

Thank You Mike Gravel

No one has ever publically thanked Gravel for his efforts. But there is that letter from Ed Patton, the Alyeska executive who led

reporter for the former Anchorage Daily News changed “tent” to a “dome,” which covered the mountain. “I was tagged as crazy for wanting to cover Mt. McKinley with a dome, and that is the ridiculous story that stuck.” With the state facing another economic crisis, and the oil in the pipeline dwindling, Alaska needs to focus on other things it can sell, Gravel says. One of those is its year-round beauty. And selling that should not be left entirely to the tour boat companies that operate only in the summer. He An Original Thinker thinks the state should actively For many Alaskans, Gravel re- Mike Gravel-2016 sell winter tourism, too. mains elusive, a contrary figGravel is proud of his Senate reure known as a “maverick” for his unusual cord, which includes releasing the Pentagon ideas. But he is an original thinker, and Papers in Congress and filibustering to force often his ideas are misunderstood and dis- an end to the military draft, but he hopes torted by opponents. Alaskans, in particular, will remember him One idea was to increase winter tourism as the person who secured the trans-Alaska in Alaska, which he believes is still needed. oil pipeline. “Without the pipeline, the state Gravel’s idea in 1978 for a large tent structure would have been bankrupt, and the Native on Denali’s south side came from technology community would have never realized its poused at the winter Olympics at Munich and tential with the Alaska Native Claims SettleMontréal. “It was to cover hundreds of acres at ment Act,” Gravel says. R the base of Mount McKinley [Denali] on state lands with a Teflon tent so that tourists would Writer Shehla Anjum is based in have some protection from our harsh winter Anchorage. weather,” he says. Unfortunately for Gravel, a

Alaska Business Monthly | September 2016 www.akbizmag.com

TULALIP MY GAME IS ALWAYS MIXING BUSINESS WITH PLEASURE.

Transform your meeting into an unforgettable event. Unrivaled luxury and flexible meeting spaces with state-of-the-art facilities combine to promise success truly more than a feeling - This is My Tulalip.

3 0 M I N U T E S N O R T H O F S E AT T L E

R E S E R VAT I O N S : 888 .7 1 6 .7 1 6 2 | T U L A L I P C A S I N O. CO M

ALASKA NATIVE BUSINESS SPECIAL SECTION

Ahtna, Inc.

AHTNA Inc.

Michelle Anderson, Pres. PO Box 649 | Glennallen, AK 99588 Phone: 907-822-3476 | Fax: 907-822-3495 news@ahtna.net | ahtna-inc.com

Revenue Sources: Not disclosed. Business Activities: Ahtna’s principle activities include

Aleut Corporation

Subsidiaries: Ahtna Netiye’ | Ahtna Development Corp. | Ahtna Facility Services, Inc. | Ahtna Enterprises Corp. | Ahtna Support & Training

Revenue Sources: Operations and Maintenance Contracts, $116,642,992; Fuel Sales, $9,766,007; Rental Properties, $2,709,361; Natural Resource, $6,026,235; Investment income, $1,766,140; Earnings, 593,395; Other, $437,968. Business Activities: Federal contracting; O&M; instrumentation for oil and gas industry; mechanical contracting; laboratory analysis, field testing, land remediation; commercial and residential real estate; fuel sales and storage; oil well testing services; information technology; and construction services. Significant Endeavors: Port of Adak development.

Aleut Corp.

Matt Fagnani, CEO 4000 Old Seward Hwy., Suite 300 Anchorage, AK 99503 Phone: 907-561-4300 | Fax: 907-563-4328 info@aleutcorp.com | aleutcorp.com

Arctic Slope Regional Corp.

Arctic Slope Regional Corporation Rex A. Rock Sr., Pres./CEO PO Box 129 | Barrow, AK 99723 Phone: 907-852-8633 | Fax: 907-852-5733 twitter.com/ASRC_AK | asrc.com

Bering Straits Native Corp.

Bering Straits Native Corporation Gail R. Schubert, Pres./CEO 4600 DeBarr Rd., Suite 200 | Anchorage, AK 99508 Phone: 907-563-3788 | Fax: 907-563-2742 media@beringstraits.com | beringstraits.com

Bristol Bay Native Corporation Jason Metrokin, Pres./CEO 111 W. 16th Ave., Suite 400 | Anchorage, AK 99501 Phone: 907-278-3602 | Fax: 907-276-3924 info@bbnc.net | bbnc.net

Calista Corp.

Andrew Guy, Pres./CEO 5015 Business Park Blvd., Suite 3000 | Anchorage, AK 99503 Phone: 907-275-2800 | Fax: 907-275-2919 calista@calistacorp.com calistacorp.com; facebook.com/calistacorporation

Revenue Sources: Petroleum Refining & Marketing 26.9% Government Services 33.5 Energy Support Services 26.5 Industrial Services 6.5 Construction 5.5 Other 1.1. Business Activities: Main business segments include: petroleum refining and marketing; government services; energy support services; industrial services; construction; and resource development. Significant Endeavors: In 2015, ASRC’s subsidiary Petro Star Inc. broke ground on an asphalt plant at its North Pole Refinery. Full operation is expected by summer 2016. This year, ASRC joined Voice of the Arctic Inupiat, a nonprofit corporation creating a unified voice for the North Slope community.

Revenue Sources: Base Operation Support Services Information Technology Logistics and Procurement Professional Support Services Construction Security Services Hardware Retail and Wholesale Distribution. Business Activities BSNC’s diverse capabilities include logistics, aircraft and airfield services, base operations support services, special training and security, administrative services, IT services, communications, construction, environmental services, distribution and hardware. Significant Endeavors: The Coast Guard Reauthorization Act of 2016 mandates the transfer, to BSNC, of Point Spencer to BSNC. Port Clarence, adjacent to Point Spencer is the only deep water port of refuge on the American Arctic and is being considered for future uses related to increased marine traffic in Bering Strait. Subsidiaries: Inuit Services, Inc. | Bering Straits Aerospace Services LLC | Bering Straits Logistics Services LLC | Bering Straits Information Technology LLC | Bering Straits Technical Services LLC | Bering Straits Aki LLC | Eagle Eye Electric LLC | Ayak

Bristol Bay Native Corp.

Calista Corporation

construction and environmental, facilities management and support, engineering, government contracting, land management and resource development, and oil and gas pipeline services. Significant Endeavors: Ahtna remains dedicated to its mission of providing economic, cultural, and social benefits to its shareholders. A new endeavor for Ahtna is natural gas exploration near our Glennallen, AK headquarters. We are optimistic of a resource discovery that will help address the rural energy crisis in the Ahtna region and hopeful for one that will benefit the state at large.

Revenue Sources: Not disclosed. Business Activities: Petroleum Distribution, Government Services, Construction, Industrial Services, and Tourism. Significant Endeavors: Helping to develop economic opportunities in the Bristol Bay region. Subsidiaries: Bristol Bay Resource Solutions LLC | Eagle Group | STS-Glacier Group | SpecPro Group | Vista Group | Business Resource Solutions LLC | Bristol Alliance of Companies | CCI Alliance of Companies | SES Group | PetroCard, Inc. | Bristol Bay Mission Lodge LLC |

Revenue Sources: Contracting and Professional Services; Construction Services; Environmental Services; Marine Services; Rental and Property Management; Marketing/PR Agency; Camp Services and Catering; Communications; Calista Region Resources; Other Region Resources. Business Activities: Construction; Heavy equipment sales, rental, parts; Federal contracting; Real estate; Telecommunications; Media services; Public relations; Environmental services; Advertising; Natural resource development. Significant Endeavors: Work continues developing policies and procedures for enrollment of descendants in 2017. The number of shareholders is projected to triple. Subsidiaries: Ookichista Drilling Services, Inc | Tunista Services LLC | Y-Tech Services, Inc. | Yulista Aviation, Inc. | Yulista Management Services, Inc. | Chiulista Services, Inc. | Brice Incorporated | Tunista, Inc. |

ALASKA EMPLOYEES: 186 WORLDWIDE EMPLOYEES: 944 SHAREHOLDERS: 3,878 ACRES: 1.577 MILLION* 2015 GROSS REVENUE: $137,942,098 2014 GROSS REVENUE: $120,307,293 *1.5 Million subsurface acres & 77,000 surface acres

Subsidiaries: Aleut Enterprises LLC, Anchorage, Alaska Aleut Management Services, Colorado Springs, Colorado Aleut Real Estate LLC, Anchorage, Alaska | Alaska Instrument LLC, Anchorage, Alaska | C&H Testing LLC Bakersfield, California Patrick Mechanical | ARS International

ALASKA EMPLOYEES: 1255 WORLDWIDE EMPLOYEES: 4,411 SHAREHOLDERS: 10,000 ACRES: 3 MILLION 2015 GROSS REVENUE: $1,512,022,000 2014 GROSS REVENUE: $1,736,084,000 Bristol Bay Industrial | Peak Oilfield Service Company | CCI Industrial Services | Kakivik Asset Management | Bristol Alliance Fuels | Katmailand, Inc.

Alaska Business Monthly | September 2016 www.akbizmag.com

Chugach Alaska Corp.

Gabriel Kompkoff, CEO 3800 Centerpoint Dr., Suite 1200 | Anchorage, AK 99503-4396 Phone: 907-563-8866 | Fax: 907-563-8402 communications@chugach.com | chugach.com Revenue Sources: Government Services, Facilities Services, Energy Services

Cook Inlet Region Inc.

Cook Inlet Region, Inc. Sophie Minich, Pres./CEO PO Box 93330 | Anchorage, AK 99509-3330 Phone: 907-274-8638 | Fax: 907-263-5183 info@ciri.com | ciri.com

Revenue Sources: Real Estate, Oilfield and Construction Services, Land and Natural Resources, Energy and Infrastructure, Environmental Services,

Doyon Ltd.

Doyon, Limited Aaron Schutt, Pres./CEO 1 Doyon Pl., Suite 300 Fairbanks, AK 99701-2941 Phone: 907-459-2000 | Fax: 907-459-2060 info@doyon.com | doyon.com

Koniag Inc.

Koniag, Inc. Elizabeth Perry, Ph.D., CEO 194 Alimaq Dr. | Kodiak, AK 99615 Phone: 907-486-2530 | Fax: 907-486-3325 facebook.com/KoniagInc | koniag.com

Revenue Sources: For Fiscal Year ending March 31, 2015: contracting and sales revenue-$260,262,000; Lease income-$569,000; Natural Resources Revenue-$6,576,000; Equity in earnings of affili-

NANA Regional Corp.

NANA Regional Corporation, Inc. Wayne Westlake, Pres./CEO PO Box 49 | Kotzebue, AK 99503 Phone: 907-442-3301 | Fax: 907- 442-4161 news@nana.com | nana.com/regional

Sealaska

Sealaska Corp.

Anthony Mallott, Pres./CEO One Sealaska Plaza, Suite 400 | Juneau, AK 99801-1276 Phone: 907-586-1512 | Fax: 907-586-2304 webmaster@sealaska.com | sealaska.com

Revenue Sources & Business Activities: Water & Maritime: Water monitoring and data analytic capability; IT services;

www.akbizmag.com

Tourism and Hospitality, Government Services and Private Equity (See 2015 Business Report, Letter from Our President for additional details.) Business Activities: CIRI’s financial strength and expertise spans diverse business segments which primarily include real estate, oilfield and construction services, land and natural resources, energy and infrastructure, environmental services, government services and private equity. Significant Endeavors: CIRI expanded its investments in the energy and infrastructure sector in 2015. Joining other well-capitalized investors, CIRI partnered in the Middletown Energy Center, a 467-megawatt natural gas-fired power plant in Ohio that will service the largest wholesale power market in the world. In addition, CIRI became a lending partner to the 150-megawatt Briscoe Wind Farm in northern Texas. The expansion in the energy sector follows CIRI’s development of the Fire Island Wind project in 2012.

Revenue Sources: Oilfield Services Government Contracting Lands & Natural Resources Tourism. Business Activities: Oil field services, government contracting, natural resource development, tourism, telecommunications, laundry services. Significant Endeavors: Doyon, headquartered in Fairbanks and Alaska’s largest private landowner, has been actively exploring for oil and gas resources in the Nenana basin for more than a decade. It has acquired modern seismic data and drilled two exploration wells in the basin to date with a third well in summer 2016.

ates-$(103,000); Interest Income-$298,000; Other-$(142,000). Business Activities: Koniag’s approach to business has evolved to meet new challenges, expanding opportunities and the needs of its shareholders. The corporation’s investments range from real estate holdings, resource development, and business operations that include oversight of over a dozen subsidiaries. Significant Endeavors: The Koniag Board of Directors is dedicated to preserving the culture and land for future generations by keeping our businesses profitable to provide benefits such as dividends, education/ employment opportunities, and a source for culture information to current and future shareholders. Subsidiaries: Digitized Schematic Solutions LLC | Frontier Systems Integrator LLC | Koniag Development Company LLC | Koniag Services, Inc. | Professional Computing Resources, Inc. | XMCO, Inc. | Dowland-Bach Corporation |

Revenue Sources: Sources are: Natural resources, marketable securities and business units. Business Activities: Responsible natural resource development as well as oil and gas, federal and commercial services to a wide array of industries. Significant Endeavors: The US Coast Guard Arctic Operations facility in Kotzebue was named after former NANA President and Alaska National Guard Adjutant General (1986-1991), John Shaeffer. NANA sold NANA Oilfield Services, Inc. to Saltchuk.

general construction and design build; environmental remediation and services; Natural Resources: Sustainable timber harvest and community based food projects; forest products; construction aggregates; Seafood & Natural Foods: Seafood businesses that add value. Significant Endeavors: Sealaska made its first investment as part of its 2012 strategic plan. Sealaska has purchased a minority interest in Independent Packers Corporation (IPC), a custom seafood processor located in Seattle, Washington. Since 2012 we have reengineered our businesses to increase operating cash flow. Subsidiaries: Sealaska Timber Company | Alaska Coastal Aggregates | Sealaska Environmental Services | Managed Business Solutions | Sealaska

ALASKA EMPLOYEES: 800 WORLDWIDE EMPLOYEES: 5,700 SHAREHOLDERS: 2,600 ACRES: 1 MILLION* 2015 GROSS REVENUE: $758,000,000 2014 GROSS REVENUE: $626,000,000 *Chugach is entitled to 928,000 acres of the 10 million acres in the Chugach Region of southcentral Alaska. 378,000 acres full fee entitlement, and 550,000 acres of subsurface estate.

ALASKA EMPLOYEES: 859 WORLDWIDE EMPLOYEES: 1,863 SHAREHOLDERS: 8,660 ACRES: 1.9 MILLION* 2015 GROSS REVENUE: $268,226,000 2014 GROSS REVENUE: $304,421,000 *600,000 surface acres and approx. 1.3 million subsurface estate.

ALASKA EMPLOYEES: 1,383 WORLDWIDE EMPLOYEES: 1,832 SHAREHOLDERS: 19,500 ACRES: 12.5 MILLION 2015 GROSS REVENUE: $378,288,768 2014 GROSS REVENUE: $362,816,481 Subsidiaries: Doyon Oil Field Services, Inc. | Doyon Government Contracting, Inc. | Doyon Natural Resources Development Corporation | Northern Laundry Services | Doyon Tourism | Northstar Manager LLC

ALASKA EMPLOYEES: 61 WORLDWIDE EMPLOYEES: 703 SHAREHOLDERS: 3,841 ACRES: 1.1 MILLION* 2015 GROSS REVENUE: $267,460,000 2014 GROSS REVENUE: $211,493,000 *110,000 surface and 990,000 subsurface acres

ALASKA EMPLOYEES: 5,000 WORLDWIDE EMPLOYEES: 15,000 SHAREHOLDERS: 14,000 ACRES: 2.2 MILLION 2015 GROSS REVENUE: $1,600,000,000 2014 GROSS REVENUE: $1,600,000,000 Subsidiaries: NANA Development Corporation

September 2016 | Alaska Business Monthly

2016 ALASKA NATIVE REGIONAL CORPORATIONS DIRECTORY

Chugach Alaska Corporation

Business Activities: Chugach’s operating subsidiaries provide exceptional services in three core business lines throughout Alaska, the Lower 48 and worldwide: Government services; Facilities services; and Energy services. Significant Endeavors: We continued to make headway exploring opportunities to develop natural resources within the Chugach region with potential to support stable financial returns and in-region employment and economic development opportunities for shareholders, and produced a video series designed to tell Chugach’s story and bridge the gap between the corporation and new generations of shareholders and descendants: https://www.youtube.com/channel/UCqqH3x-QjUwkLMTSkZnwnWQ. Subsidiaries: Chugach Systems Integration LLC | Chugach Federal Solutions, Inc. | Chugach Government Services, Inc. | Chugach Industries, Inc. | Chugach Information Technology, Inc. | Chugach Management Services, Inc. | Chugach World Services, Inc. | Defense Base Services, Inc. |

ALASKA NATIVE BUSINESS SPECIAL SECTION

Village Corporation Afognak Native Corporation Akhiok-Kaguyak, Inc. Akiachak, Limited Akutan Corporation Alakanuk Native Corporation Alaska Peninsula Corporation Aleknagik Natives Limited Alexander Creek, Inc.* Arviq Inc. Askinuk Corporation Atmautluak Limited Atqasuk Corporation Atxam Corporation Ayakulik, Inc. Azachorok Inc. Baan O Yeel Kon Corporation Bay View, Inc. Bean Ridge Corporation Beaver Kwit’chin Corporation Becharof Corporation Belkofski Corporation Bethel Native Corporation Brevig Mission Native Corporation Cape Fox Corporation Caswell Native Association* Chalkyitsik Native Corporation Chaluka Corporation Chefarnrmute, Inc. Chevak Company Chickaloon-Moose Creek Native Association, Inc. Chignik Lagoon Native Corporation Chignik River Limited Chinuruk Inc. Chitina Native Corporation Choggiung Limited Chuloonawick Corporation Council Native Corporation Cully Corporation Inc. Danzhit Hanlaii Corporation Deloy ges Corporation Deloycheet, Inc. Dineega Corporation Dinyea Corporation Dot Lake Native Corporation Eklutna, Inc. Ekwok Natives Limited Elim Native Corporation Emmonak Corporation Evansville, Inc. Far West, Inc. Gana-A’Yoo, Limited Goldbelt, Inc.** Golovin Native Corporation Gwitchyaa Zhee Corporation Haida Corporation Healy Lake Trade Village Corporation Hee-Yea-Lingde Corporation Huna Totem Corporation Hungwitchin Corporation Igiugig Native Corporation 44

Address 215 Mission Rd., Suite 212, Kodiak, AK, 99615 1400 W. Benson Blvd. #425, Anchorage, AK, 99503 PO Box 51010, Akiachak, AK, 99551 PO Box 8, Akutan, AK, 99553 PO Box 89, Alakanuk, AK, 99554 2221 E. Northern Lights Blvd., Ste 119, Anchorage, AK, 99508 PO Box 1630, Dillingham, AK, 99576 8128 Cranberry St., Anchorage, AK, 99502 PO Box 9, Platinum, AK, 99651 PO Box 89, Scammon Bay, AK, 99662 PO Box 6548, Atmautluak, AK, 99559 PO Box 1169, Barrow, AK, 99723 PO Box 47001, Atka, AK, 99547 3741 Richmond #5, Anchorage, AK, 99508 PO Box 32213, Mountain Village, AK, 99632 PO Box 74558, Fairbanks, AK, 99707 7926 Old Seward Hwy., Suite A-7, Anchorage, AK, 99518 PO Box 82062, Fairbanks, AK, 99708 PO Box 24090, Beaver, AK, 99724 PO Box 220029, Anchorage, AK, 99522 PO Box 46, King Cove, AK, 99612 PO Box 719, Bethel, AK, 99559 PO Box 85024, Brevig Mission, AK, 99785 PO Box 8558, Ketchican, AK, 99901 HC 89 Box 83, Willow, AK, 99688 PO Box 53, Chalkyitsik, AK, 99788 PO Box 104, Nikolski, AK, 99638 PO Box 70, Chefornak, AK, 99561 PO Box 179, Chevak, AK, 99563 PO Box 875046, Wasilla, AK, 99687 16016 Mammoth Cir., Eagle River, AK, 99577 PO Box 48008, Chignik Lake, AK, 99548 PO Box 90009, Nightmute, AK, 99690 PO Box 3, Chitina, AK, 99566 PO Box 330, Dillingham, AK, 99576 2635 Draper Dr., Anchorage, AK, 99517 PO Box 1183, Nome, AK, 99762 5001 Eagle St., Unit B, Anchorage, AK, 99503 PO Box 71372, Fairbanks, AK, 99701 PO Box 150, Anvik, AK, 99558 PO Box 228, Holy Cross, AK, 99602 PO Box 28, Ruby, AK, 99768 PO Box 71372, Fairbanks, AK, 99707 3500 Wolf Run, Fairbanks, AK, 99709 16515 Centerfield Dr., Suite 201, Eagle River, AK, 99577 PO Box 1189, Dillingham, AK, 99576 PO Box 39010, Elim, AK, 99739 PO Box 49, Emmonak, AK, 99581 PO Box 60670, Fairbanks, AK, 99706 3150 C St., Suite 270, Anchorage, AK, 99501 6927 Old Seward Hwy., Suite 101, Anchorage, AK, 99518 3075 Vintage Blvd., Suite 200, Juneau, AK, 99801 PO Box 62099, Golovin, AK, 99762 PO Box 329, Fort Yukon, AK, 99740 PO Box 89, Hydaburg, AK, 99922 PO Box 60300, Healy Lake No. 19, Fairbanks, AK, 99706 PO Box 9, Grayling, AK, 99590 9301 Glacier Hwy., Suite 200, Juneau, AK, 99801 PO Box 84594, Fairbanks, AK, 99708 PO Box 4009, Igiugig, AK, 99613

Phone (907) 486-6014 (907) 258-0604 (907) 825-4328 (907) 698-2206 (907) 238-3117 (907) 274-2433 (907) 842-2385 (907) 243-5323 (907) 979-8113 (907) 558-5411 (907) 553-5428 (907) 852-8633 (907) 839-2237 (907) 279-7911 (907) 591-2527 (907) 456-6259 (907) 345-9627 (907) 458-2176 (907) 456-1640 (907) 561-4777 (907) 497-3122 (907) 543-2124 (907) 642-4091 (907) 225-5163 (907) 345-6626 (907) 848-8112 (907) 576-2215 (907) 867-8115 (907) 858-7920 (907) 373-1145 (907) 840-2225 (907) 845-2212 (907) 647-6813 (907) 823-2223 (907) 842-5218 (907) 949-1234 (907) 443-6513 (907) 569-2705 (907) 455-8484 (907) 663-6396 (907) 476-7177 (907) 468-4405 (907) 452-5063 (907) 347-1251 (907) 696-2828 (907) 464-3336 (907) 890-3741 (907) 949-1129 (907) 374-7084 (907) 276-2580 (907) 569-9599 (907) 790-4990 (907) 779-3251 (907) 662-2933 (907) 285-3721 (907) 479-0638 (907) 453-5133 (907) 523-3670 (907) 778-2231 (907) 533-3211

Fax (907) 486-2514 (907) 258-0608 (907) 825-4115 (907) 698-2207 (907) 238-3120 (907) 274-8694 (907) 842-1662 (907) 243-5428 (907) 979-8229 (907) 558-5412 (907) 553-5610 (907) 633-6213 (907) 839-2217 (907) 825-4115 (907) 591-2127 (907) 456-4486 (907) 345-9017

(907) 561-4778 (907) 497-3123 (907) 543-2897 (907) 642-2060 (907) 225-3137 (907) 848-8114 (907) 867-8895 (907) 858-7311 (907) 373-1183 (907) 840-2270 (907) 845-2217 (907) 647-6814 (907) 823-2202 (907) 842-5462

(907) 569-2715 (907) 663-6355 (907) 476-7176 (907) 468-4403 (907) 474-8224 (907) 474-1632 (907) 696-2845 (907) 464-3378 (907) 890-3091 (907) 949-1415 (907) 374-7085 (907) 272-2581 (907) 569-9699 (907) 790-4999 (907) 779-3261 (907) 662-3056 (907) 285-3944 (907) 453-5151 (907) 789-1896 (907) 533-3217

Alaska Business Monthly | September 2016 www.akbizmag.com

www.akbizmag.com

Address 3201 C St., Suite 406, Anchorage, AK, 99606 PO Box 7040, Diomede, AK, 99762 PO Box 49, Eek, AK, 99578 PO Box 9, False Pass, AK, 99583 PO Box 263, Kake, AK, 99830 P. O. Box 73, Kaktovik, AK, 99747 PO Box 39, Kasigluk, AK, 99609 PO Box KXA Kasaan, Ketchikan, AK, 99950 215 Fidalgo Ave., Suite 101, Kenai, AK, 99611 1577 C St., Suite 302, Anchorage, AK, 99501 PO Box 1050, Kotzebue, AK, 99752 PO Box 992, Nome, AK, 99762 PO Box 129, Klawock, AK, 99925 PO Box 209, Haines, AK, 99827 PO Box 872130, Wasilla, AK, 99687 PO Box 147, Akiak, AK, 99552 PO Box 5023, Koliganek, AK, 99576 PO Box 20308, Kotlik, AK, 99620 8585 Old Dairy Rd., Suite 104, Juneau, AK, 99801 PO Box 20207, Kotlik, AK, 99620 1603 College Rd., Fairbanks, AK, 99709 PO Box 53050, Koyuk, AK, 99752 PO Box 36, Kipnuk, AK, 99614 PO Box 150, Goodnews Bay, AK, 99589 PO Box 160, Savoonga, AK, 99769 801 B St., Suite 300, Anchorage, AK, 99501 PO Box 110, Kwethluk, AK, 99621 PO Box 110, Kwigillingok, AK, 99622 2000 Dowling Rd., Suite 3, Anchorage, AK, 99507 PO Box 109, Levelock, AK, 99625 605 West Tudor Rd., Anchorage, AK, 99503 PO Box 1962, Kodiak, AK, 99615 PO Box 149, Manokotak, AK, 99628 PO Box 650, Teller, AK, 99778 PO Box 90, Marshall, AK, 99585 457 Cindy Dr., Fairbanks, AK, 99701 3300 C St., Suite 111, Anchorage, AK, 99503 PO Box 309, McGrath, AK, 99627 PO Box 34030, Napakiak, AK, 99634 215 Mission Rd., #201, Kodiak, AK, 99615 PO Box 913, Nelson Lagoon, AK, 99571 PO Box 87, Saint Mary’s, AK, 99658 PO Box 5528, Newtok, AK, 99559 PO Box 52, Mekoryuk, AK, 99607 PO Box 39130, Ninilchik, AK, 99639 PO Box 401, Northway, AK, 99764 PO Box 37068, Toksook Bay, AK, 99637 PO Box 20187, Kotlik, AK, 99620 PO Box 129, Nunapitchuk, AK, 99641 PO Box 84, Perryville, AK, 99648 PO Box 49, Lower Kalskag, AK, 99626 PO Box 71, Old Harbor, AK, 99643 PO Box 29, Wainwright, AK, 99782 PO Box 571, Dillingham, AK, 99576 PO BOX 6085, Napaskiak, AK, 99559 PO Box 149, Unalaska, AK, 99685 PO Box 89, Ouzinkie, AK, 99644 PO Box 209, Hooper Bay, AK, 99604 PO Box 61, Naknek, AK, 99633 1500 West 33rd Ave., Suite 220, Anchorage, AK, 99503

Phone (907) 571-1246 (907) 686-3221 (907) 536-5211 (907) 548-2217 (907) 785-3221 (907) 640-6120 (907) 447-6113 (907) 542-2214 (907) 283-4851 (907) 561-4487 (907) 442-3165 (907) 443-5494 (907) 755-2270 (907) 766-2211 (907) 376-2845 (907) 765-7228 (907) 596-3440 (907) 899-4016 (907) 790-2992 (907) 899-4014 (907) 452-8119 (907) 963-2424 (907) 896-5414 (907) 967-8428 (907) 984-6184 (907) 480-6220 (907) 757-6212 (907) 588-8112 (907) 222-6900 (907) 287-3040 (907) 276-1550 (907) 486-4833 (907) 289-1062 (907) 642-2308 (907) 679-6512 (907) 452-3094 (907) 569-9005 (907) 524-3391 (907) 589-2227 (907) 486-3606 (907) 989-2204 (907) 438-2332 (907) 237-2200 (907) 827-8636 (907) 567-3866 (907) 778-2298 (907) 427-7929 (907) 899-4453 (907) 527-5717 (907) 797-2300 (907) 679-6517 (907) 286-2286 (907) 763-2613 (907) 842-3511 (907) 737-7090 (907) 581-1276 (907) 680-2208 (907) 527-4915 (907) 246-4277 (907) 277-1500

Fax (907) 571-1256 (907) 686-3222 (907) 536-5733 (907) 548-2317 (907) 785-6407 (907) 640-6217 (907) 477-6026 (907) 542-2215 (907) 283-4854 (907) 562-4945 (907) 442-2165 (907) 443-5400 (907) 755-2966 (907) 766-2973 (907) 376-2847 (907) 765-7619 (907) 596-3462 (907) 899-4017 (907) 790-2995 (907) 899-4528 (907) 452-8148 (907) 963-3552 (907) 896-5140 (907) 967-8226 (907) 984-6184 (907) 480-6126 (907) 588-8313 (907) 222-6955 (907) 287-3032 (907) 276-3680 (907) 289-1007 (907) 642-2309 (907) 679-6740

(907) 524-3062 (907) 589-2442 (907) 486-2745 (907) 989-2233 (907) 438-2919 (907) 237-2710 (907) 827-8639 (907) 567-3867 (907) 778-2498 (907) 427-7326 (907) 899-4454 (907) 527-5229 (907) 797-2258 (907) 679-6516 (907) 286-2287 (907) 763-2926 (907) 842-3512 (907) 581-1496 (907) 680-2268 (907) 246-4419 (907) 277-1501

September 2016 | Alaska Business Monthly

2016 ALASKA NATIVE VILLAGE CORPORATIONS LISTINGS

Village Corporation Iliamna Natives Limited Inalik Native Corporation Iqfijouaq Company Isanotski Corporation Kake Tribal Corporation Kaktovik Inupiat Corporation Kasigluk, Inc. Kavilco Inc. Kenai Natives Association, Inc.** Kijik Corporation Kikiktagruk Inupiat Corporation King Island Native Corporation Klawock Heenya Corporation Klukwan, Inc. Knikatnu, Inc. Kokarmuit Corporation Koliganek Natives Limited Kongnikilnomuit Yuita Corporation Kootznoowoo, Inc. Kotlik Yupik Corporation K’oyitl’ots’ina, Limited Koyuk Native Corporation Kugkaktlik, Limited Kuitsarak, Inc. Kukulget, Inc.*** Kuukpik Corporation Kwethluk Inc. Kwik Inc. Leisnoi, Inc. Levelock Natives Limited Lime Village Company Litnik, Inc. Manokotak Natives Limited Mary’s Igloo Native Corporation Maserculiq, Inc. Mendas Cha-ag Native Corporation Montana Creek Native Association* MTNT, Limited Napakiak Corporation Natives of Kodiak, Inc.** Nelson Lagoon Corporation Nerklikmute Native Corporation Newtok Native Corporation Nima Corporation Ninilchik Natives Association, Inc. Northway Natives Inc. Nunakauiak Yupik Corporation Nunapiglluraq Corporation Nunapitchuk Limited Oceanside Corporation Ohog Inc. Old Harbor Native Corporation Olgoonik Corporation Olsonville, Inc.* Oscarville Native Corporation Ounalashka Corporation Ouzinkie Native Corporation Paimiut Corporation Paug-Vik Inc., Limited Pedro Bay Corporation

2016 ALASKA NATIVE VILLAGE CORPORATIONS DIRECTORY

Village Corporation Pilot Point Native Corporation Pilot Station, Inc. Pitka’s Point Native Corporation Point Possession, Inc.* Qanirtuuq, Inc. Qemirtalek Coast Corporation Russian Mission Native Corporation Saguyak Inc. Salamatof Native Association, Inc. Sanak Corporation Sea Lion Corporation Seldovia Native Association, Inc. Seth-De-Ya-Ah Corporation Shaan-Seet, Inc. Shaktoolik Native Corporation Shee Atika, Inc. Shishmaref Native Corporation Shumagin Corporation Shuyak, Inc. Sitnasuak Native Corporation Sivuqaq, Inc. Solomon Native Corporation St. George Tanaq Corporation St. Mary’s Native Corporation St. Michael Native Corporation Stebbins Native Corporation Stuyahok Limited Swan Lake Corporation Tanacross Inc. Tanadgusix Corporation Tanalian, Inc.* Teller Native Corporation Tetlin Native Corporation The Chenega Corporation The English Bay Corporation The Eyak Corporation The King Cove Corporation The Kuskokwim Corporation The Port Graham Corporation The Tatitlek Corporation Tihteet’aii, Inc. Tikigaq Corporation Toghotthele Corporation Togiak Natives Limited Tozitna, Limited Tulkisarmute Inc. Tuntutuliak Land, Limited Tununrmiut Rinit Corporation Twin Hills Native Corporation Tyonek Native Corporation Uganik Natives, Inc. Ukpeagvik Inupiat Corporation Unalakleet Native Corporation Unga Corporation Uyak Natives, Inc. Wales Native Corporation White Mountain Native Corporation Yak-Tat Kwaan Inc. Zho-Tse, Inc.

Address PO Box 487, Pilot Point, AK, 99649 PO Box 5059, Pilot Station, AK, 99650 PO Box 289, St. Mary’s, AK, 99658 877 Shakespeare Cir., Anchorage, AK, 99503 PO Box 69, Quinhagak, AK, 99655 PO Box 5070, Kongiganak, AK, 99559 PO Box 48, Russian Mission, AK, 99657 PO Box 4, Clarks Point, AK, 99569 100 N. Willow St., Kenai, AK, 99611 PO Box 194, Sand Point, AK, 99661 PO Box 87, Hooper Bay, AK, 99604 PO Drawer L, Seldovia, AK, 99663 PO Box 56, Minto, AK, 99758 PO Box 690, Craig, AK, 99921 PO Box 46, Shaktoolik, AK, 99771 315 Lincoln St., Suite 300, Sitka, AK, 99835 PO Box 72151, Shishmaref, AK, 99772 PO Box 189, Sand Point, AK, 99661 PO Box 727, Kodiak, AK, 99615 PO Box 905, Nome, AK, 99762 PO Box 101, Gambell, AK, 99742 PO Box 243, Nome, AK, 99762 4141 B St., Suite 301, Anchorage, AK, 99503 PO Box 149, Saint Mary’s, AK, 99658 PO Box 59049, St. Michael, AK, 99659 PO Box 71110, Stebbins, AK, 99671 PO Box 1309, Dillingham, AK, 99576 PO Box 25, Nunam Iqua, AK, 99666 PO Box 76029, Tanacross, AK, 99776 4300 B St., Ste 209, Anchorage, AK, 99503 2425 Merrill Field Dr., Anchorage, AK, 99501 PO Box 649, Teller, AK, 99778 PO Box 657, Tok, AK, 99780 3000 C St., Suite 301, Anchorage, AK, 99503 1637 Stanton Ave., Anchorage, AK, 99508 901 LeFevre St., PO Box 340, Cordova, AK, 99574 PO Box 38, King Cove, AK, 99612 PO Box 227, Aniak, AK, 99557 629 L St., Suite 205, Anchorage, AK, 99501 561 E 36th Ave., Anchorage, AK, 99503 PO Box 71372, Fairbanks, AK, 99701 2121 Abbott Rd., Anchorage, AK, 99507 PO Box 249, Nenana, AK, 99760 PO Box 150, Togiak, AK, 99678 PO Box 129, Tanana, AK, 99777 PO Box 65, Tuluksak, AK, 99679 PO Box 8106, Tuntutuliak, AK, 99680 PO Box 89, Tununak, AK, 99681 PO Box TWA, Twin Hills, AK, 99576 1689 C St., Suite 219, Anchorage, AK, 99501 PO Box 853, Kodiak, AK, 99615 PO Box 890, Barrow, AK, 99723 PO Box 100, Unalakleet, AK, 99684 PO Box 130, Sand Point, AK, 99661 PO Box 31, Chignik, AK, 99564 PO Box 529, Wales, AK, 99783 PO Box 81, White Mountain, AK, 99784 PO Box 416, Yakutat, AK, 99689 PO Box 130, Shageluk, AK, 99665

Phone (907) 797-2213 (907) 549-3512 (907) 438-2953 (907) 563-1848 (907) 556-8290 (907) 557-5529 (907) 584-5885 (907) 236-1235 (907) 283-3745 (907) 383-6075 (907) 758-4415 (907) 234-7625 (907) 798-7181 (907) 826-3251 (907) 955-3241 (907) 747-3534 (907) 649-3751 (907) 383-3525 (907) 486-3842 (907) 387-1200 (907) 985-5826 (907) 443-7526 (907) 272-9886 (907) 438-2315 (907) 923-3143 (907) 934-3074 (907) 693-3122 (907) 498-4227 (907) 883-4130 (907) 278-2312 (907) 272-3581 (907) 642-6132 (907) 347-2741 (907) 277-5706 (907) 562-4703 (907) 424-7161 (907) 497-2312 (907) 675-4275 (907) 272-7432 (907) 278-4000 (907) 455-8484 (907) 365-6299 (907) 832-5832 (907) 493-5520 (907) 366-7255 (907) 695-6854 (907) 256-2315 (907) 652-6311 (907) 525-4327 (907) 272-0707 (907) 486-3009 (907) 852-4460 (907) 624-3411 (907) 383-5215 (907) 486-4681 (907) 664-3641 (907) 622-5003 (907) 784-3335 (907) 473-8262

Fax (907) 797-2258 (907) 549-3234 (907) 438-2276 (907) 563-7918 (907) 556-8713 (907) 557-5517 (907) 584-5311 (907) 236-1287 (907) 283-6470 (907) 383-6074 (907) 758-4815 (907) 234-7637 (907) 798-7556 (907) 826-3980 (907) 955-3243 (907) 747-5727 (907) 649-3731 (907) 383-5356 (907) 486-5097 (907) 443-3063 (907) 985-5426 (907) 443-7527 (907) 272-9855 (907) 438-2918 (907) 923-3142 (907) 934-2399 (907) 693-3148 (907) 498-4242 (907) 883-4129 (907) 278-2350 (907) 278-7030 (907) 642-6133 (888) 898-1176 (907) 277-5700 (907) 281-2220 (907) 424-5161 (907) 497-2444 (907) 675-4276 (907) 278-7679 (907) 278-4050 (907) 455-8486 (907) 365-6250 (907) 832-5834 (907) 493-5554 (907) 366-7122 (907) 693-6932 (907) 256-2441 (907) 652-6315 (907) 525-4820 (907) 274-7125 (907) 852-4459 (907) 624-3833

(907) 664-3641 (907) 622-5004 (907) 784-3622 (907) 473-8217

Notes: *Group Corporation, **Urban Corporation, ***Reserve Corporation. SOURCE: State of Alaska | Department of Commerce, Community and Economic Development | Division of Community and Regional Affairs | Updated January 29, 2016

Alaska Business Monthly | September 2016 www.akbizmag.com

safety driven

SAFETY IS OUR LICENSE TO DO BUSINESS. - TOM HENDRIX, VICE PRESIDENT, OIL & GAS

Safety Driven

FINANCIAL SERVICES

Merger and Acquisition Funding Facilitates Business Transitions in Alaska

Photo courtesy of Ash Adams

Tiffany Tutiakoff, president and CEO of Northwest Strategies, in her office.

Alaska Native corporations, private equity groups, professional firms, and baby boomers fuel transactions By Tracy Barbour

ast year, when Tiffany Tutiakoff acquired Northwest Strategies, she became president and CEO of the state’s only privately Native-owned and managed communications agency. It was a rewarding move by Tutiakoff, who had worked at Northwest Strategies for eleven of the nearly thirty years it has existed in Alaska. To finance the deal, Tutiakoff turned to a former client and lender: Alaska Growth Capital (AGC) BIDCO, Inc. AGC was the ideal funding partner. “I was already familiar with the company, and it had a great track record for service,” she says. “I felt comfortable knowing Alaska Growth Capital, a subsidiary of Arctic Slope Regional Corporation, was Alaska Native-owned and socially and fiscally responsible to my fellow Alaska Native people. I felt like the business had my best interests at heart.” In fact, Tutiakoff says her experience 48

working with AGC was better than she expected. “This was a major business decision for me, yet the team made it feel easy,” she explains. “They were patient, helpful, and kind. Navigating the ins and outs of an acquisition can be daunting, but I never felt rushed or pressured to move at a pace faster than I was comfortable with.” The sale of Northwest Strategies exemplifies the growing number of companies involved in mergers and acquisitions in Alaska. Financiers like AGC, First National Bank Alaska, KeyBank, Northrim, and Wells Fargo are funding a variety of these transactions—although primarily in the area of acquisitions. Many of the recent deals have been dominated by Alaska Native corporations making new investments, private equity firms capitalizing on opportunities in Alaska, and business owners selling to competitors, family members, and employees.

Flexible Financing Options

AGC frequently sees acquisitions relating to service-based businesses, such as marketing agencies, law firms, and medical and dental offices. “These types of businesses typically have a proven cash flow and brand or name recognition,” says Jesse Janssen, vice present of lending at AGC. Restaurants and retail stores have also been part of the mix, along with companies transitioning ownership to the next generation. “As baby boomers are reaching the age of retirement, we are seeing a lot of generation-based sales to children or other family members,” Janssen explains. AGC can finance mergers and acquisitions for companies in almost any industry and for qualified projects up to $10 million. It offers term debt from five to twenty-five years to support a leveraged buy-out. “The transaction can be 100 percent funded by

Alaska Business Monthly | September 2016 www.akbizmag.com

AGC in some cases,” Janssen says. “In other cases, we can fund a portion of a project in conjunction with owner carryback or in partnership with another lender.” During its ninety-four-year history in Alaska, First National has financed a wide variety of mergers and acquisitions. Like AGC, recent transactions at the bank have centered on Native corporations acquiring complementary businesses and retiring owners selling to relatives, competitors, and employees, according to Jay Page, a vice president in First National’s corporate lending division. In fact, business acquisitions involving employees—often structured as an employee stock ownership plan (ESOP)—are becoming increasingly common. And it’s only natural, given the bond owners often have with their longstanding employees. “I think there’s an affinity over the decades for your longtime employees,” Page says. “You come to know them and their families, and you want to help them. You want them to be successful.” Page adds: “Plus, with ESOPs, you [the owner] can phase the sell over several years, so you’re not taking a lump sum payment, which is good tax wise.” Wells Fargo has completed hundreds of millions of dollars of merger and acquisition financing in the past several years in Alaska, according to Alaska Commercial Banking Manager Sam Mazzeo. The bank provides merger and acquisition financing in various forms. Some customers have established lines of credit that are available for these types of transactions. On the other hand, some customers obtain financing after the new opportunity has been identified and presented to the bank for underwriting. Mazzeo points out that financing that relies on the acquired or merged company for repayment requires underwriting of the acquired or merged business. But that’s not always the case: “Some of our borrowers have enough existing financial capacity to prequalify for financing without relying upon the acquired company for debt repayment,” he says. In addition to merger and acquisition activity taking place with Alaska Native corporations and private equity groups, larger companies are consolidating smaller companies. Mazzeo says he expects these trends to continue in the foreseeable future and he advises prospective buyers to be well-capitalized. ”The average debt-to-equity ratio in acquisitions is about 50-50 in my experience,” he says.

ACHIEVE MORE

9,523

Alaskan children taught financial literacy

Of all the numbers we work with this is the most important

907

$1.1 Million Dollars donated by Northrim Bank employees

SUPPORTING WHAT MATTERS At Northrim Bank, giving back to the community is part of who we are. Sometimes support is financial. Often times a volunteer effort — like when we teach financial literacy at local shelters and schools. Every year we give to the people and organizations that strengthen our community. Learn more at northrim.com.

Call us and let’s get started. 907-562-0062 | 1-800-478-2265

Tailoring Transactions to the Situation When it comes to merger and acquisition funding, each transaction is very unique. That’s why KeyBank Enterprise Banker Joe Murry tailors the deal according to the type of business, industry, and collateral involved. www.akbizmag.com

September 2016 | Alaska Business Monthly

For example, KeyBank has an entire group dedicated to “leveraged cash flow lending,” which typically encompasses private equity firms that are pushing the normal bank leverage, says Murry, who is part of KeyBank’s commercial banking group in Alaska. With this situation, the bank considers the acquiring company’s cash flow—which has to be very strong. Typically, there will not be guarantors in this kind of transaction the way there might be with commercial transactions. In addition to providing merger and acquisition funding, Key Bank partners with KeyBanc Capital Markets to offer a broad suite of banking services and investment advice. “What KeyBanc Capital Markets strives for is to provide advisory information on the buy and sell side,” Murry explains. “They are there from the beginning of the transaction until the transaction closing.” Merger and acquisition financing is a well-established financing mechanism, but many people are not aware that it exists, says Kelly McCormack, a vice president and commercial loan officer with Northrim Bank. “They—especially professionals— may think they have to carry the note if they are going to sell,” he says. Acquisition financing is not as easy to navigate as standard commercial loans, McCormack says, but banks have creative

ways to assist clients in this area. Using internal financing is a prime example. “We will take all of the company’s assets [including accounts receivables and inventory], and we will secure it with the ownership interest of the person buying the business,” he says. However, acquisition financing still requires some investment by the borrower. “If they put up to 25 percent in, we look at it and say you’ve got some significant skin in the game,” McCormack explains. “Then for the remaining 75 percent, the bank can consider the accounts receivables and assignment of their ownership interest.” Another example of using creativity to facilitate financing is employing the backing of the Small Business Administration. For instance, if a long-term manager is buying the business, the bank could consider using a guaranteed Small Business Administration loan. “It gives us a little bit of strength if the collateral is weak,” McCormack says.

Process for Obtaining Financing

The process for obtaining funding for merger and acquisition deals varies, McCormack says. In some cases, Northrim requires the buying party to obtain an independent assessment of the business involved to validate the purchase price. “Of-

ten in business transactions, they will go with whatever the seller says without doing their due diligence,” he says, explaining the necessity of a valuation. Rarely does McCormack see collateral like a building included in acquisition financing transactions. A more common scenario involves the assignment of the owner’s interest—which isn’t strong collateral, but it provides some leverage. “Often, we have to get creative with the amortization to make the cash flow,” he says. It may be less feasible for professionals who are acquiring law, medical, or accounting practices to put skin in the game. They might have name recognition and can generate substantial cash flow—but their collateral is often limited. So the bank will scrutinize other areas. “We’ll look at the average cash flow of the business, demographics, client base, and whether the person coming in will be able to maintain the business,” McCormack says. For Murry of KeyBank, the buyer’s process for getting merger and acquisition financing starts with one critical element: strategy. “Before you’re even going to contemplate financing, it involves setting a strategy for the type and size of company you are willing to consider,” he says. “Getting that in place is the first thing, and it allows the company to start a search for the target companies.”

Alaska Business Monthly | September 2016 www.akbizmag.com

The quest for the right company to acquire can be methodical and lengthy. But sometimes, Murry says, acquisition transactions happen more serendipitously, especially when the buyer and seller have anestablished, amicable relationship. Once a strategy has been developed, buyers need to show evidence of how the target company will fit. Murry says banks want to know: “What is your plan to integrate the target company? How is it going to make you a stronger company?”

Due Diligence and Planning Are Essential The financing process is very different for sellers and buyers, says Page of First National. The seller has to determine what the market value of their business is. “If you totally miss the mark, you won’t get buyers, and if you undersell it, you will cheat yourself,” he says. On the other side, potential buyers may evaluate five or six businesses before finding one that meets their requirements. This involves a considerable amount of due diligence, from studying the numbers to examining the client list of the business being acquired. “I think the quality of the due diligence is very important,” Page says. “As part of the due diligence, you have to take into consideration economic factors. What

www.akbizmag.com

does three and four years down the road look like revenue wise?” Once all the due diligence and homework has been completed, this information needs to be presented in a way that can be easily digested by the lender. “They have to convince the bank that they know the numbers, and they know what they are getting into,” Page says. “The bank wants to see the buyer—their client—be successful.” First National could require any number of items for documentation, including the last three years of balance sheets and income statements, a list of the equipment being included, a client list, and a list of the accounts receivables of the company being acquired. “We have to make sure it’s a going concern and it’s profitable,” Page says. At AGC, the underwriting process for mergers and acquisitions is very similar to applying for a conventional commercial loan. However, there are some stark differences. For instance, AGC will look harder at the proposed owner or management team to gauge their acumen and ensure they have the right intellectual capital to run the operation, Janssen says. And in the case of a merger, AGC will look for synergies created by blending cost centers; this includes possible savings by increasing buying power or consolidating administra-

tive functions. “We are looking at potential overlap in market share and if there are significant run-off risks with new ownership,” he explains. “What may differentiate us in this space is that we can take a forwardlooking approach to the transaction, meaning we can underwrite to the projected cash flow after the transaction occurs.” AGC will also need to substantiate the purchase price, including how the value was determined and whether it is considered to be accurate. Regardless of whether the transaction is a stock purchase or asset sale, AGC will, in most cases, obtain a business evaluation, Janssen says. “This differs from a real estate appraisal or equipment appraisal in that it will value the entire ‘enterprise’ as a going concern,” he says. “The appraiser will likely utilize multiple weighted approaches to determine a final value of the company. In cases where there is a significant amount of ‘blue sky’ or goodwill in the transaction, we may require more capital into the deal from the buyers.” With Wells Fargo, the process to obtain merger and acquisition financing is also a bit more rigorous than financing an existing business that is not contemplating material growth or change. It comes down to due diligence and planning. “The bank wants to know that the borrower has

September 2016 | Alaska Business Monthly

adequately mitigated for integration risk factors and how the company will operate once the proposed merger or acquisition takes place,” Mazzeo says.

How to Be Better Prepared to Secure Financing To become better prepared to secure merger or acquisition funding, Murry suggest that potential buyers enhance their own business performance. Why? Businesses that are consistently improving profitability, addressing their weaknesses, and growing their existing businesses have a better chance of successfully integrating a new business acquisition, he says. “I recommend that businesses look at their financial reporting and forecasting abilities and compare their financial performance with their industry peers,” Murry says. “Banks have access to data that allows bankers to analyze the relative financial performance of similar companies, and good bankers can help businesses identify weaknesses and areas of opportunity in their performance and financial metrics.” In terms of his key advice, Mazzeo says any business that is looking to acquire another business should consider hiring a team of external advisors to help them evaluate, negotiate, structure, finance, and

document an acquisition. “There are lawyers, bankers, accountants, appraisers, and other professionals who help companies with mergers and acquisitions every day,” he says. “They will help mitigate acquisition risk and optimize the transaction for you.” In addition, having a discussion with your banker early in the process is critical, Mazzeo says. “Banks have keen insight on company valuations and can tell you what can and can’t be financed,” he says. “We can also provide references to help you build your merger and acquisition advisory team.” Murry of KeyBank says the borrower’s preparations for financing should include having good strong proforma financial projections. It’s not only important to show the potential for growth, but it’s also important to have a clear reasons for the projections. On the flip side, it’s also essential to look at the possible downsides of the acquisition. Potential buyers need to consider negative scenarios like what if the culture of the merging companies don’t fit or what if a key employee does not commit to staying with the company. “It is important that companies have looked at all sides—the upsides and downsides,” Murry says. Generally, the strategy piece will drive all the preparation for getting financing for a merger or acquisition, Murry says. “Hav-

ing a defined strategy to present is the most critical point of being able to secure financing,” he says. Murry encourages borrowers to have an advisory team to do the proper due diligence to get to a transaction. He also advises buyers to think beyond the closing of the transaction to consider how they’re going to integrate the company, its culture, and its employees. He says, “Sometime it feels like closing means you are done, but that’s when the real work starts.” Page feels that doing the proper due diligence is one of the best ways to prepare to win financing approval. “The most important thing you can do is thoroughly analyze the business you intend to acquire,” he says. “That’s when you are making your buying decision. If you did your due diligence, the banker will see that you are making the right decisions and will likely finance your acquisition.” He also says buyers should consider economic trends like where the business will be years from now and if there are any adverse factors on the horizon. “It all still comes down to the same thing: doing due diligence and supporting your numbers for what you want to do,” Page says. R Freelance writer Tracy Barbour is a former Alaskan.

Alaska Business Monthly | September 2016 www.akbizmag.com

“

It’s easy. You give your employees an added benefit. I get a college savings plan.

”

Give your employees a benefit upgrade today. Enroll in the Payroll Deduction Option offered by the University of Alaska College Savings Plan. The Payroll Deduction Option is an easy, no-cost employer benefit program that adds value to your benefits package while contributing to the overall financial well-being and college savings goals of your employees.

UACollegeSavings.com

844-529-5290

I you are not an Alaska resident, you should compare this plan with any 529 college savings plan offered by your home state or your beneficiary's If home state and consider, before investing, any state tax or other benefits that are only available for investments in the home state’s plan. You can also visit our website or call the phone number to request a Plan Disclosure Document, which includes investment objectives, risks, fees, charges and expenses, and other information. You should read the Plan Disclosure Document carefully before investing. Offered by the Education Trust of Alaska. T. Rowe Price Associates, Inc., Investment Advisor/Program Manager. T. Rowe Price Investment Services, Inc., Distributor/Underwriter. 9/16

2016-US-22555

CONSULTANT’S CORNER

Creating a Transferable Business (Part 3) When you exit, who will do your job? By Mel B. Bannon

s the owner of a privately-held business, you are likely a catalyst for the ongoing running and growth of the business. The roles that most owners fill in their companies often span a number of different areas within the business. Even with an established management team, owners are often still the “straw that stirs the drink” on a daily basis. Without the stirring where would your business be? And, as you consider your exit from your business, you need to answer two questions on this topic. First, “How dependent is my company on me?” and next, “Who will do my job when I leave?”

What Is Your Job at Your Company? In your business are you the sales person or are you the head of operations? Or are you both? Do you innovate within your processes and/or product line? Do you limit yourself to watching over the finances on a regular basis? Or do you do some of both? Are you the leader amongst the staff or are you the owner who stays in their office in order to empower others to do their jobs without micro-managing them? Overall, how much of your company is dependent upon you and who will fill those roles after you exit from the company? Again, these are critical questions to answer if you want to have a smooth transition of the business and achieve the highest value with the fewest continued obligations from you during a “neat and orderly transition” later. Are You a Bottleneck for Your Business and Your Exit? An important question to ask about the job(s) that you perform at your company is whether or not you actually slow down the growth of your business. In other words, are you a bottleneck to your company? You likely are a bottleneck to your company and your successful exit if any/all of the following apply to you:  You are critically involved with decisions on a daily basis, to the point where 54

Reducing the dependence that your business has on your individual efforts will allow you to identify and develop others who can run the business, as well as create a more valuable, more transferable business, increasing the pool of potential purchasers. projects or steps in a procedure cannot advance without you.  You are the only person who holds key vendor and customer relationships and the only person who takes those phone calls and/or meetings.  Planning and services or product design and innovation, comes only from you.  You are the only person who knows the company’s financial position and has bank relationships to fund the business.  The strategic direction of the business is primarily set and understood by you.  Employees are generally disempowered to make decisions without your input and/ or final approval.

Unlocking the Bottleneck Start with a Measurement of Your Company’s Dependence on You It is difficult to manage something that you cannot first measure. Therefore, if you are interested in knowing what your job or your role is at your company, as well as how dependent your business is on your individual efforts, you can take the Owner Dependence Index survey (developed by Pinnacle Equity Solutions, Inc.). The ODI survey asks forty questions, spread over eight areas of your business, that will then provide a score of 1 percent to 100 percent and let you know how dependent your business is on your individual efforts. Moreover, your ODI score will help identify how much of a bottleneck you may be at your company.

Below is a link to the Owner Dependence Index online survey. There is no fee to take the assessment and a private customized report will be confidentially sent immediately to your email. http://odireport.com/Survey/Register/ D532A288_40 (Pinnacle Equity Solutions © 2016)

The Challenges to Overcome

Owners typically resist changes to how they work in their businesses for a variety of reasons. Some simply don’t want to make any changes after years of getting things the way that they want them. Other owners want to make the changes but don’t want to do the work or do not know where to begin, while others do not want to spend the money on new hires to do the jobs that these owners should not be doing. Further some owners simply do not trust other people with these critical functions. Give serious consideration as to what is holding you back from making these changes and letting go of certain tasks that others could more easily complete. One motivation to make these changes is that your pool of potential future owners becomes more limited if you are a bottleneck to your business and do too many jobs.

The Exit Challenge to a Bottleneck Overall, the only person who will be willing to own your business after you is someone who not only wants the exact job that you currently have but also is as qualified as you to do that job. If you have not properly assigned and delegated critical responsibilities, then it stands to reason that in most cases, the only person who can do your job

Alaska Business Monthly | September 2016 www.akbizmag.com

after you is someone with the experience to do so as well as the financial backing to purchase your company. All things being equal, this person, if they exist, is likely running their own business today.

Exit and Other Benefits of a Low ODI When you can reduce your owner dependence by distributing responsibilities to others, you are in a stronger position to execute on an exit plan that liberates you from your business. What is also interesting about going through this exercise is that your business will likely actually run better once you begin to take a step back and empower capable people to do certain tasks without you. Concluding Thoughts

As a business owner who may be beginning to think through the eventual exit from the business, this online assessment tool may be the ideal starting point for preparing for your ultimate business exit. Reducing the dependence that your business has on your individual efforts will allow you to identify and develop others who can run the business, as well as create a more valuable, more transferable business, increasing the pool of potential purchasers. We hope that this perspective will assist you in achieving a more successful and profitable exit on your terms and your schedule. R Mel B. Bannon, CLU, ChFC, RFC, is a registered representative of Lincoln Financial Advisors, a broker/dealer, member SIPC, and offers investment advisory service through Sagemark Consulting, a division of Lincoln Financial Advisors Corp., a registered investment advisor, 31111 Agoura Rd., Ste. 200, Westlake Village, CA 91361 (818) 540-6967 or 1500 W. 33rd Ave., Ste. 210 Anchorage, AK 99503 (907) 522-1194 . Insurance offered through Lincoln affiliates and other fine companies. This information should not be construed as legal or tax advice. You may want to consult a tax advisor regarding this information as it relates to your personal circumstances. Exit Planning offered through unaffiliated third parties. AK Insurance License #19665 CRN-1539028-070516 www.akbizmag.com

September 2016 | Alaska Business Monthly

ENERGY

Transitional Leadership at Chugach Electric Association ‘Seamless’ change between Evans and Thibert By Rindi White

n mid-July, the state’s largest electric cooperative, Chugach Electric Association, Inc., quietly handed off the leadership reins of the company from Brad Evans, who has led the cooperative since 2007, to Lee Thibert, who has held various roles at Chugach Electric for nearly thirty years. Thibert says he has been part of the decisionmaking process at Chugach for many years, and shares similar goals with Evans.

Alaska Business Monthly | September 2016 www.akbizmag.com

Chugach Electric Association CEO Lee Thibert at the utiltyâ&#x20AC;&#x2122;s Southcentral Power Plant in Anchorage. ÂŠ Judy Patrick judypatrickphotography.com

September 2016 | Alaska Business Monthly

“One of the advantages of the transition process was that Brad and I had very similar strategies and goals going forward. I don’t think you’ll see a significant change, and it should be seamless,” Thibert says. Transitions can be challenging for large, board-run cooperatives, often surrounded by political intrigue. Evans and Thibert say they worked hard to make this transition a smooth one, for the benefit of Chugach members and for the company itself. “We’ve been proactively working on succession planning since I’ve been CEO. That has multiple benefits for the organization. It promotes good will among the workforce that there is a plan, that you can rise to the top internally; and, two, it gives us a stable outlook going forward,” Evans says. In his twenty-nine years with Chugach, Thibert has led nearly every department of the cooperative, from line operations to production, engineering, power control, safety, and more. Thibert started as manager of line operations and quickly moved to overall operations director, managing all line and substation operations. In the mid-1990s he became executive manager of the operating divisions, directing the efforts of all power control, power generation and transmission, and distribution power delivery. In the late 1990s, with the potential for deregulation on the horizon, Thibert reorganized the operating divisions, placing the power generation assets under a separate manager. In the early 2000s, he became general manager of distribution, which included distribution operations and customer service. After several years in that role, he took a brief break to work with consulting engineers Dryden and LaRue, Inc., and then returned to Chugach to become senior vice president of strategic planning.

Changing Times, Changing Relationships In the last few years, Chugach’s role in the overall makeup of electric utilities in the Railbelt, between Fairbanks and Homer, has changed significantly. Formerly the wholesale power supplier for several utilities along the Railbelt, Chugach is now primarily a fully-integrated retail power supplier instead. That change happened mostly under Evans’ leadership, and it was not always an easy process. As a vice president, Thibert took over the strategic planning and business relations with Chugach’s wholesale customers. “We were losing them; they said they were going to be building their own generation,” he says. Some of the Railbelt utilities, particularly Chugach and neighboring electric cooperative Matanuska Electric Association, had disagreements over tenets of the wholesale power contracts between the two companies. 58

The power contracts and the amount of say in Chugach’s decision-making process that wholesale power buyers had were sources of rancor between the two companies for years. “There were issues with the wholesale customers not wanting to buy power from Chugach, so there was an uncertain future,” Evans says. “We made a plan around what we thought was the safest lane to be in for the future, and that led to the construction of the Southcentral Power Project and a partnership with ML&P [Municipal Light and Power].” The Southcentral Power Project is a $360 million new gas-fired power plant Chugach and ML&P built next to Chugach’s headquarters near Minnesota Drive and International Airport Road in Anchorage. Completed in February 2013, the 200.2 megawatt power plant includes three natural gas-fired turbines and a steam turbine, each coupled with a generator. In combined-cycle mode, Chugach says, the 850-degree exhaust from the gas turbines makes steam to power the steam turbine, producing extra electricity with no additional fuel cost. Chugach owns 70 percent of the project, and ML&P owns 30 percent. Under the agreement terms between the two utilities, Chugach operates and dispatches power from the plant, and the two utilities pay for fuel and expenses and receive output based on their ownership percentages. In his role as strategic planner, Thibert helped craft the agreements that resulted in the power plant partnership between Chugach and ML&P. Other changes were afoot as well. Chugach previously had long-term natural gas contracts in place, but in the 2000s it became clear that without further investment in Cook Inlet gas production, natural gas stores were dwindling. “It was a very tense time for Chugach. Over 80 percent of Chugach’s electric power generation comes from burning natural gas as a fuel. We were looking at all types of different options,” Thibert says. Thibert and Evans, along with other members of a working group that included ML&P and ENSTAR Natural Gas Company, worked with now-US Senator Dan Sullivan, then the commissioner of the Alaska Department of Natural Resources, to encourage investment in Cook Inlet. Through that partnership, Hilcorp invested in Cook Inlet leases held by Marathon and Chevron and production ramped up. ENSTAR and Chugach also worked together to develop the Cook Inlet Natural Gas Storage Alaska project, or CINGSA, a gas storage facility located in Kenai capable of holding 11 billion cubic feet of gas in a depleted natural gas reservoir. The $161.4 million facility, of which Chugach is an

Alaska Business Monthly | September 2016 www.akbizmag.com

anchor tenant, began service in spring 2012. “We’ve used that to great advantage,” Evans says. “It helps offset us having to buy any peaking gas, so we can buy our gas through base contracts.” Thibert was instrumental in negotiating Chugach’s CINGSA involvement. After CINGSA and the Southcentral Power Project were in place, Homer Electric and Matanuska Electric brought their own power plants online and Thibert helped the two cooperatives transition to being power producers. “I worked with Homer and MEA … [by] providing additional services to them, making sure that when their generation units came online, that it was really seamless,” he says. Thibert also led “a pretty intensive effort” to acquire partial ownership of the Beluga River natural gas field in Cook Inlet. The $152 million purchase took ownership of ConocoPhillips’ one-third interest in the field. As a partner with ML&P, Chugach owns 30 percent of ConocoPhillips’ ownership share, and ML&P owns 70 percent. The two utilities expect the joint purchase to supply “a significant portion of the utilities’ gas needs over the next ten years, while saving the residents of Anchorage millions during the same period,” according to a press release about the purchase. Evans www.akbizmag.com

Evans’ Departure

Evans, a Fairbanks native, has been with Chugach Electric most recently since 2001, but had worked for Chugach from 1985 until the mid-1990s when he returned home to Fairbanks to work for Golden Valley Electric Association, Inc. He returned to Chugach to help the company bring a weighty re-build of three natural gas-fired generators at its Beluga plant back under budget and get the project done on the scheduled timeline. He returned as vice-president of power supply and, in late 2007, became interim CEO when outgoing CEO Bill Stewart was abruptly voted out by the Chugach Board of Directors. About five months later, he was appointed CEO permanently. “It was a challenge—there’s always a challenge in transition,” Evans says. “I think the board’s expectations were pretty high. The challenge was to work on the major concerns for Chugach going forward, in addition to taking over as CEO.” Evans says at the time, a lot of Chugach’s debt from past projects was coming due—roughly $270 million was due between 2011 and 2012. He restructured the debt and helped steer the company toward a more stable financial future. He said he’s pleased with the projects he’s

helped Chugach tackle, from the Southcentral Power Project to CINGSA and the Beluga River gas field, to incorporating Fire Island wind power into the company’s energy profile. “We were planning for an uncertain future with renewables. We feel like we came out with the right choice there, and the board supported that,” he says. Now, he says, it’s time to work on some of the projects he put off for so many years. His “closet of things that you want to do but keep putting off,” as he calls it, is over-full and needs attention. He’s been involved in the community throughout his career, from coaching hockey to supporting the exchange student program of AFS-USA (formerly American Field Services), and he supports his wife’s active volunteer schedule. “I don’t want to go out there and put myself on overload, but I certainly will entertain being more involved in all aspects of the community,” he says.

Focusing on the Future

Thibert, meanwhile, is adjusting to the day-today stream of duties of a CEO. “On the internal side, we have a theme of really empowering our future. [We do that by] using top-notch leaders, using new technology, focusing on what we think is important— safety, reliability, service to our members, and

September 2016 | Alaska Business Monthly

environmental stewardship. And we maintain our core values: trust, integrity, and being a good neighbor any place we can,” Thibert says. Externally, Thibert says his focus will be working together with other utilities on the future needs of the Railbelt. “When all the utilities broke apart and did their own generation, you lose the economies of scale that come with doing things as one. Now we’re trying to unite and operate the system as one under a structure that is acceptable to all who choose to participate,” he says. That might happen by operating a combined transmission system, which allows for all the utilities’ generation to be dispatched

“The biggest challenge Chugach and the other utilities face is the Alaska economy. It’s hard to manage an organization that has a shrinking load profile. Ten years ago, each consumer used about 750 kWh a month and today it’s down to about 600 kWh.”

—Lee Thibert CEO, Chugach Electric

or operated in the most efficient manner possible. Power pooling, looking at economic dispatch options, and finding the best way to integrate renewable energy throughout the Railbelt are also matters that the Railbelt utilities need to address, he says.

Advancing Alaska through empowered marketing.

TIFFANY TUTIAKOFF President and CEO of the state’s only Alaska Native-owned and managed communications agency.

nwstrat.com Brand Marketing | Advertising | Public Relations | Research and Strategic Planning | Healthcare and Social Marketing

And while other utilities might have bristled when Chugach suggested plans to work together in the past, Thibert says he believes a new spirit of cooperation may be on the horizon. “Now, we really have an even playing field. Everyone is a vertically integrated facility, with generation, transmission, and distribution,” he says. “Everybody has the same leverage, the same influence, so I think they will start to see that it makes sense to work together. We’re seeing it already in bilateral transactions, and I think you will see it even more in power pooling and transmission integration.” He hopes the cooperative spirit will result in ironing out a few details, like setting a universal transmission rate, so renewable energy can more easily be purchased throughout the Railbelt. “If Golden Valley wanted to buy Fire Island power and get it to Fairbanks, they would have to pay a tariff on our transmission system, another tariff to the Intertie, and another tariff to get it to their transmission system. If there was a universal transmission rate where everyone paid based on a load, on a postage-stamp basis, then it’s not based on transactions,” he says. Power pooling would also make using renewables easier, Thibert says. “If you’re in a [power] pool, then it doesn’t really matter whose wind it is, it will flow into the system when it’s needed. That’s the beauty of the power pool—you bring it in when you need it and settle the economics by predetermined protocols after the fact. Right now, we end up curtailing some of our wind because it’s not needed [at the time it’s produced].” The largest issue facing Chugach, however, is the state’s economy. “The biggest challenge Chugach and the other utilities face is the Alaska economy,” he says. “It’s hard to manage an organization that has a shrinking load profile. Ten years ago, each consumer used about 750 kWh a month and today it’s down to about 600 kWh. We do have concerns with a shrinking economy and what that would do to rates. We’re trying to make efficiencies in our system and make improvements.” R Rindi White is a freelance journalist living in Palmer.

Alaska Business Monthly | September 2016 www.akbizmag.com

WORLD CLASS TRAINING PROGRAMS Register today and join the ranks of over 9 million graduates worldwide who are accomplishing more than they ever thought possible.

UPCOMING COURSES • SPRING PROGRAMS ALSO AVAILABLE LIVE SUCCESSFULLY

THE DALE CARNEGIE COURSE

Perform as a persuasive communicator, problem-solver and focused leader, and develop a take-charge attitude initiated with confidence and enthusiasm. September 20-22, 2016 Anchorage, Alaska

SELL SUCCESSFULLY

DALE CARNEGIE SALES TRAINING: WINNING WITH RELATIONSHIP SELLING

Build relationships that create a sustainable pipeline of success. September 20-22, 2016 Anchorage, Alaska

Ask us about a Customized Training & Development Solution for your team or take advantage of our Online Learning Programs.

MANAGEMENT

On Leadership By Dr. Jim Johnsen

eadership is a hot topic these days. People ask: What is it? Is it important? Why don’t we see more of it? Is it a gift, is it inherited, or can it be learned? What styles are most effective? Does business leadership translate to political leadership? How can I get better at it? Whatever the question, it’s clear that there is a massive interest in leadership. Leadership books abound. Some are of the “how to” sort, from Machiavelli’s “The Prince” to the plethora of guides featuring (pick the number) immutable laws of leadership. Others are biographical, studies of great leaders through the ages from Moses to U.S. Grant to Martin Luther King, Jr. Still others are novels or plays showcasing leaders and their skills and capabilities, their triumphs and downfalls; Shakespeare’s Julius Caesar comes to mind. Finally, there are academic studies of leadership, focusing on the most effective types of leadership in certain historical, organizational, and cultural contexts. Plutarch, Max Weber, James MacGregor Burns, Ron Heifitz, and Lee Boleman are among the many great scholars who have focused on leadership. Likewise, leadership development programs are ubiquitous. Among the most famous and effective are those provided by our military, but such programs also are offered in many of our schools and universities, churches, unions, scouting groups, sports teams, companies, and service clubs. Developed on the (correct, in my view) premise that leadership can be learned, these programs build leadership capabilities among members so they can more effectively carry out the missions of the organizations they lead. I have had the great fortune to see and experience great leadership for many years. My father was an Army officer in command of combat units and my mother was a professional tennis player and coach. I interned for Leon Panetta in college and studied with renowned scholars in graduate school. I worked for superb leaders at the University of Alaska, Alaska Communications, and Doyon, Limited. And I have had many opportunities to lead, from basketball teams and labor negotiations to administrative organizations, statewide commissions, church councils, and now, the University of Alaska. 62

University of Alaska President Jim Johnsen.

These leadership experiences have taught me a lot. Here are just a few lessons that may be of value to you.  Listening: As a negotiator, I learned to listen, so that I could understand not only what the other side wanted but more

importantly what their underlying interests and concerns were. That way, even if I could not agree with a particular position coming across the table, I could fashion an alternative that met both their interests and mine. And as a leader, it is critically important to listen to your people, for at

Alaska Business Monthly | September 2016 www.akbizmag.com

the end of the day, they are the ones who are going to deliver your organization’s mission.  Learning: It is critical for leaders to practice lifelong learning. Situations change, people come and go, unforeseen issues arise, and new technologies are developed. Plus, there’s usually a person or organization out there performing at a higher level than you. It makes sense to pay close attention to what they are doing so you can transfer some of that learning to your organization. Sources for learning certainly can include books and classes, but the best source by far is other people; people you lead and people who lead you.

possible. We cannot read PowerPoint slides or communicate with our people solely by email. Instead, as leaders, we need to engage with our people in a relationship of mutual respect and appreciation for the role each plays in success. We must be honest and transparent and speak from our hearts, as well as our brains. We must show that we have a vision and a passion for the organization. Only then people will follow.

Going forward

I began with a list of questions about leadership. These and other questions have in-

terested and vexed people literally for thousands of years. There are no clear or easy answers. But we must not give up. The problems we face—racial tension, international terrorism, and economic insecurity for example—demand leadership. And despite all the books, classes, and promises of leadership, we need it now more than ever from leaders—like all of you—who truly listen, learn, improve, believe, love, and inspire. R

Dr. Jim Johnsen is the President of the University of Alaska.

 Improving: Related to learning, improving means that you put that learning to use in getting better, in honestly assessing performance and putting in the serious effort to lead your people, serve your customers (students, in my case at the University of Alaska) more effectively, and leave your organization better when you leave than when you found it. You owe it to yourself and to the people you lead to continuously improve.  Believing: In order to lead, especially in tough times, you must believe in your mission and values. Your people will know if you don’t. They will see a hollow, weak leader. But they will see that if you believe, you have the drive, energy, confidence, and commitment that it takes to lead others well. They will see that you live up to your values and to those of your people. They see that you will sacrifice your own interests for those of the team’s. Among the most important values for leaders are loyalty, honesty, courage, humility, and selfless service to others.  Loving: Organizations are made up of people. And no matter how rational, strategic, technical, abstract, or complex the work, people are emotional beings who need to know that they are valued and cared for not just for the work they do, but for themselves. This requires that we connect with our people, understand their hopes and aspirations, know their concerns and fears, and give them the support and appreciation they need as people first, and only then as teachers, programmers, or engineers.  Inspiring: Leaders cannot just show up to work and leave on time. We cannot simply inform our people what’s going on. We cannot get by with the least effort www.akbizmag.com

September 2016 | Alaska Business Monthly

MANAGEMENT

Executive Recruitment Put your best foot forward in attracting executive-level talent By Jillian Caswell

dentifying and attracting competent professionals for crucial positions is always challenging for business owners, and seeking executive level talent can be an even more daunting mountain to climb. With the local and national economy in a climate of flux, many companies are seeing increased staff turnover and less longevity from their staff, and senior leadership is no exception. With current job market trends showing no indications that people are again remaining with employers for the long haul, we can expect to see more turnover up through executive and senior levels. This trend means that business owners need to be prepared with a strategy to draw the interest of top-level talent before being caught off guard and scrambling to fill the gap left by a departing leader. With every company’s unique business needs, ideally your strategy will be suited to your goals, mission, and vision; however, there are some basic strategic elements in appealing to executive-level candidates which can be included for many unique approaches.

Confidentiality Is Critical

Accomplished, successful executive-level talent will almost certainly require discretion and agreements for provision of confidentiality during the recruitment process. These senior leaders will undoubtedly have broad professional networks established within their industries, and while they may be considering a new opportunity for all the right reasons, gossip can wreak irreparable damage both within their industry and at their current work place. In a state such as Alaska, this need is doubly emphasized by our small-town connections. Even your fellow fisherman in Carhartts and XtraTufs may be a C-suite executive who knows someone who knows someone. If it becomes known to the wrong party that the talent you are targeting is considering new opportunities, it may prove detrimental to your candidate’s career. Confidentiality will often make or break a candidate’s interest in pursuing a new opportunity, so address your ability to offer total discretion at the very beginning of the recruitment process—in your job postings or 64

announcements and in your first conversation with the candidate.

Showcase Meaningful Growth Opportunities Once a candidate has reached the senior leadership level in their career, some companies do not consider the need for meaningful growth to retain and attract future executive candidates. A generous compensation package may not be enough to appeal the high-quality executive talent your business needs. While there may not be the potential for upward mobility to entice an executive level candidate, senior leaders often seek value in opportunities to give back. Whether through peer mentorships or community involvement programs, this is a great opportunity to get creative in adding additional value to a position that will draw exceptionally qualified candidates. For some candidates, the potential to become involved with strategic planning and provision of future stewardship to the company is an excellent area in which they may continue their personal and professional growth. Roll Up Your Sleeves and Get Down to Business Believing that merely posting a job announcement on your company website and local job boards is enough to locate top level is a misstep many employers take. The most successful approach to enticing key senior talent is a proactive approach similar to retained executive recruiters such as AES’ Executive Recruitment division. Lean on social media to network and reach out to passive candidates; make the most of your industry’s local and statewide professional networks—leave no rock unturned. Even if the person with whom you connect is not looking for something new at the time, they may know someone within their industry who might consider your opportunity. This approach certainly takes more time and effort than the “post and pray” recruitment method; you will truly see the level of results increase commensurate with the level of effort and time you are able to commit. This holds true to every part of the recruit-

ment process from crafting a well-written, appealing job announcement to exhausting your LinkedIn networks and contacts.

Evaluate Success

While these basic elements of attracting executive talent are generally good practices for companies within many industries, it is also important to evaluate the success of your current approach. If you are continually running into a brick wall, step back, regroup, and try a new angle. Even if the approach lands you well outside of your comfort zone, it may be just the unique twist to connect with your ideal executive candidate. Investing this extra time and effort now in your recruitment process will reap significant rewards in the long run by helping you connect with candidates who share your company’s values and will support the mission and goals of your business. R

Jillian Caswell is a human resources advocate who strives to serve as a recruitment and HR resource for professionals looking to make a change in their careers and chase their dreams. As she continued to progress her career with Alaska Executive Search through recruiting in the Executive Search and Office Staffing divisions, Caswell rounded out her experience by bringing her HR knowledge and recruitment capabilities to support the company as Operations Director. Her expertise in online recruitment and networking, coupled with her social media savvy, enhances her ability to effectively support the Alaska Executive Search team in connecting candidates with the right job opportunities. Contact her at 907-276-5707 or JillianC@akexec.com.

Alaska Business Monthly | September 2016 www.akbizmag.com

START-UPS

Faly Me Hannigan (left) and Arctic Horse Gear founder Jennifer Dushane.

Jennifer Dushane’s Arctic Horse Gear All-weather skirts for women who ride horses, or don’t By Rindi White

Butte marine biologist is turning the slowdown in the Alaska oil economy into a launchpad for a new business venture: making all-weather skirts for women who ride horses. A year ago, Jennifer Dushane was a graduate student, working toward a PhD in marine biology. But she was dissatisfied with the work and felt getting a degree might be more costly, both in time and effort, than it would be worth in the field she was working in. She had for several years run Arctic Ecological Research, a consulting company that contracted with oilfield companies and others to conduct research in rural Alaska. She gained a lot of knowledge about working in rural Alaska while contracting and knew that the cold-weather gear available didn’t keep her warm. 66

“I’ve spent a lot of time in these extreme conditions, wishing I had options for my legs,” she says. “By and large, women don’t have much to choose from when it comes to cold-weather gear for our legs.” As an avid horsewoman, Dushane had been thinking for a while about cold-weather gear that would be suitable for riding horses. She has, and uses, a Skhoop skirt, a popular insulated skirt that Alaskan women wear to hike or recreate outdoors—or just to wear to work or out to dinner. But the Skhoop is too narrow to accommodate riding horses, and many weren’t waterproof or machine washable. “We’ve gotten into some strange get-ups to stay warm,” she says. “I thought, why not create something that is really pretty and that works for active women?” A friend gave Dushane a wrap skirt de-

signed for riding horses, and although the skirt wasn’t exactly what she envisioned, it was a good jumping-off point for her design process. “I wanted a skirt to cover the rider, the back of a horse, and any saddle packs,” she says. In cold weather, horses move easier if their hindquarters are covered and warm.

Creating the Prototype

She got connected with a Palmer seamstress, who helped her design skirts and created prototypes. Dushane isn’t a seamstress, she says, though she tried to learn so she could better understand the process. “I tried to make a few skirts,” she says. “A few potato sacks later, I decided it wasn’t for me.” With the help of the Palmer seamstress, she created a prototype that seemed to work, and in February, got a business license for

Alaska Business Monthly | September 2016 www.akbizmag.com

her company, Arctic Horse Gear. It is one of several businesses Dushane runs—she also operates Butte’s Bethel, a two-cabin bed and breakfast, and a small organic farm on the property she and her husband own in Butte. Although her skirts are useful for all types of activites, she specifically designed them accommodate riding. They have a full two-way zipper at the front and snaps on the hem that allow it to be snapped to the waist to more easily accommodate getting on and off a horse. The long skirts also have breakaway leg straps that keep the skirt from flapping up when riding fast, but can come off legs in the case of an accident. Dushane found a commercial sewist in Anchorage and a hobby sewist in Palmer willing to help craft the skirts. She’s also working with a Palmer-based Christian practical needs ministry, Connect Palmer, which helps women and men in distress by providing items to meet immediate needs, like toilet paper and toothbrushes, as well as providing housing and job training, resume help, and other life skills training, like the vocation of sewing. Sherry Carrington, Connect Palmer’s executive director, is working with Dushane to develop a sewing program in which intraining sewists will work on parts of the skirt assembly. “It will be kind of an assembly line,” Dushane says. “I really wanted every piece of [the business] to do good somewhere.” Carrington says working with Dushane will allow her seamstresses to gain skills vital to future employment. “It would help their instruction, would help them financially, it would … help them to take the skills they are learning from us and use them in the workplace,” she says. Carrington and Dushane, in the summer, were working to develop clear sewing instructions for each step of the sewing process, so seamstresses can easily take a project from start to finish. They hoped to have the instructions ready to be used by fall. So far, Dushane says production is keeping up with demand, and she’s hoping the balance will hold for a while.

Sourcing: American Materials for Alaskan Made Products Sewing the skirts is one of many parts of the skirt construction process. Dushane worked to source the fabric and hardware at mills in the United States. “I had a few business principles for making these skirts: they had to work, they had to be pretty, and I also wanted the skirts to be made from American materials and be sewn locally in Alaska. Our products may be more expensive than you would get from something made in China, but we’re supporting the American www.akbizmag.com

economy, the Alaskan economy, and we stand behind every product we make.” Dushane makes four styles of all-weather skirts in both short and long lengths. The Arctic Insulated Skirt has six ounces of continuous fill insulation, which required minimal quilting to keep the insulative value intact. The company she buys the insulation from also supplies US military and outdoor clothing and gear company Arc’teryx. The skirt has a softshell fabric on top, is machine washable, and the sheeted insulation won’t shift in the wash, Dushane says. The Outlander skirt, named after the popular series about a World War II nurse who is transported to 1700s Scotland, is a long, full wool skirt meant to lay over the back of the saddle. The Outlander skirts are made of wool sourced from the American mill Woolrich and are lined with microfleece. “It’s romantic, and it’s really warm,” Dushane says. The Tongass is a rainproof skirt made of softshell fabric, good for hiking, riding, running errands, or going out to dinner, she says. The Backcountry skirt is a stylish alternative to chaps and, as far as Dushane knows, is the only waxed canvas riding skirt on the market in the world. A New Jersey family that has been making waxed canvas for five generations makes the canvas Dushane buys. It’s impregnated with food-grade wax, so it’s safe to be next to skin, she says. It’s a narrow skirt that comes in short or long lengths with full-length zippers in the front and back. “It really protects the legs against brush,” Dushane says. “When I have to go check out trails, I’ll put this skirt on so I can protect my legs.”

Starting Out by Giving Back

The garment industry has a steep markup for wholesale and retail prices, Dushane says. Traditionally, the wholesale value of a garment is twice what it costs to make, and the retail price is twice the wholesale value. Dushane says she didn’t think the traditional method would work for her skirts. Using that model, her skirts would cost around $800, and that price would severely limit the number of people willing to buy them. So she decided a on a 30 percent profit model, of which, about 10 percent goes to charity. “Five to 10 percent of our profit goes to the nonprofit of the buyer’s choice,” she says. “If a nonprofit advertises for us, they get 10 percent of the profit from the sales of any skirts they sell.” The skirts range in price from $159 for a short rain skirt to $259 and $289 for the long Backcountry and insulated versions. Most sell for less than $200. Dushane says the nonprofit brand ambassador program bridges marketing and promotion by having nonprofits put a link to her site on their webpage and promote the skirts September 2016 | Alaska Business Monthly

Arctic Horse Gear founder Jennifer Dushane.

BUSINESS. MEDICAL. ENVELOPE. PACKAGE. ANYWHERE.

AMS

URIER

WE DELIVER AND STORE IT ALL. (907) 278-2736

WWW.AMSCOURIERS.COM

GET RESULTS! Put my many years of marketing experience to work for your company! Give me a call today to get started.

Holly Parsons

Advertising Account Manager (907) 257-2910 hparsons@akbizmag.com

(907) 276-4373 • Toll Free (800) 770-4373

akbizmag.com

via social media, encouraging members to support her business. In turn, they get a portion of the profits of every skirt due to their efforts. It’s a win-win for both organizations, she says. The profit model might make it challenging for her to sell her garments in stores, however. A large United Kingdom tack store contacted her after seeing her skirts, but the company was cool to the idea of splitting a 20 percent profit on each skirt sold. “I’m just going to do this for now,” she says. “If we can have brand ambassadors and partner with nonprofits for marketing, I’m OK with that. It’s working so far. I’d love to be in every outdoor store, but the traditional really cheap wholesale/really expensive retail model doesn’t work for Arctic Horse, because we are sourcing American made materials and paying local people a living wage to make the skirts.” Dushane says she hopes to attend a few international horse shows and outdoor gear marketing shows in the coming year to further promote her skirts.

A Warm Reception

Dushane has only been producing skirts for a few months and selling them since the spring. In that time, she says, the reception has been very positive. She has set up a booth at a few horse shows, she says. “If they come into the booth, they almost always buy a skirt,” Dushane says. Michelle Coburn of Anchorage, a driver for the Horsedrawn Carriage Company and an avid horsewoman, says she wore a tan, wool Outlander skirt in May at the Parade of Stallions horse show at the Alaska State Fairgrounds. It was the first time an Arctic Horse Gear skirt had been worn in public. With red boots and the red and black gear she wears for the Horsedrawn Carriage Company, she looked sharp, she says, and several people told her how striking she looked. “People said, ‘Wow, you look beautiful!’” she says. Other carriage drivers she works with are interested in wearing them for their work, she says. “In traditional carriage driving, there

is sort of a lap blanket that is traditionally worn. It ties around the waist and goes over the legs. But this is so much nicer, because it’s insulated and waterproof, and that makes it a little wind-proof. When you’re driving downtown, you’re up a little higher [in the carriage], and when you turn some corners, the wind is right at you,” Coburn says. Downtown Anchorage, where the Horsedrawn Carriage Company primarily works, can be quite windy in the evenings, she says. The drivers, all women, are interested in getting an insulated, long Arctic skirt to keep warm and still look professional. “The neat thing about these skirts, to me, is that they’re not only great for riding in, they’re so stylish. They look like [they’re] right out of a Ralph Lauren ad,” Coburn says. “They don’t slide around like other brands I’ve tried. And in Alaska, we don’t get to dress really fancy, like in other places, we have to stay warm and dry. To have an option that accomplishes both of those things is nice.” Coburn has become an ambassador of sorts for Arctic Horse Gear. She has a Tongass rain skirt, an Arctic skirt, and a Backcountry skirt. She wore the Tongass skirt—the long, full version—while riding with some friends on a rainy summer day and was impressed. “It worked really well. I pulled the corner [of the skirt] up and the fabric was soaked, but my jeans legs were completely dry. My saddle was completely dry … and the horse’s rear end was totally dry.” Coburn says she plans to take a few extra skirts to sell or display when she travels in the fall to Missoula, Montana, to teach a class. “I really believe in them and I think they’re really stylish,” she says of the skirts. “I live in Alaska—I can’t make a big stand, but I can make a stand by supporting women-owned companies, companies that support nonprofits. I mean, who does that, as a start-up company? She started out right from the get-go. It’s just integrity, and I believe in supporting with my dollars, companies that do well.” R Freelance journalist Rindi White lives in Palmer.

Alaska Business Monthly | September 2016 www.akbizmag.com

Shipping with aloha. Now serving a port near you. At Matson, we’re bringing our on-time performance and award-winning customer service to Alaska and Tacoma. Our fleet is equipped with computerized tracking, supported by experienced teams in all specialties, including transporting fragile and refrigerated items. If you’re looking for a solid U.S. shipping company with over 130 years of experience in the Pacific, including Hawaii, Guam, Micronesia and China, we’re here for you.

For more information, call our Alaska Service Center at 1-877-678-SHIP or visit matson.com/Alaska

OIL & GAS

Project Icewine and 88 Energy Limited Exploring on the North Slope— one step at a time By Tom Anderson

Energy is not a company that makes grandiose promises about filling TAPS or changing the way that things are done on the North Slope. Rather, the company has chosen to take a disciplined and phased approach to its activities in Alaska. This is an approach that aims to minimize waste— after all, failing fast is the best way to fail. If that is ultimately the predestined outcome then 88 Energy suggests that there is no way to justify wasting money, time, and effort on science experiments that do not have a clear and direct linkage to value creation.

Joint Venture

The joint venture’s history is an interesting one: its early days have been summarized by 88 Energy Managing Director Dave Wall as the “right time, right place—wrong oil price.” Without the oil price dropping precipitously at the end of 2014, 88 Energy would not have had a seat at the dealing table with partner Burgundy Xploration— a company with a strong history of early-stage success in unconventional oil plays. However, opportunity at the bottom of the cycle meant a deal was struck in late 2014 and the joint venture subsequently went on to raise money, garner debt funding from a major bank, permit, and drill its maiden exploration well—all within twelve months. As the enticement for new oil and gas exploration in Alaska has been stymied by bureaucratic gridlock, the growing list of investment casualties continues to unnerve prospective resource development in the state. Despite the looming harbinger of low prices, withdrawn cor70

porate credits, and an executive push for escalated taxes, a stalwart few companies are pressing forward with perseverance, innovation, and renewed belief that the Last Frontier remains a treasure trove of petroleum potential. “For Project Icewine, Alaska has been that rare and perfect storm of factors that create a real opportunity to build value for our shareholders. Underexplored yet with so much to offer, not just in terms of remaining potential reserves, but also a fiscal system that has provided strong incentive to explore and a proud history of major oil and gas development combined with a can-do mentality,” Wall says.

Icewine Prospect

Australian-based 88 Energy is leading a 271,000 gross acre North Slope effort for shale in the Icewine prospect south of Prudhoe Bay off the Dalton Highway. Texan company Burgundy Xploration is the concept originator for the primary play being targeted and the minority partner, with 88 Energy holding a 77.5 percent working interest in the project. The initial drilling occurred in late 2015 with the Icewine#1 well. This well was designed to test what the company called “Achilles’ Heels” for the HRZ liquid’s rich unconventional play, namely thermal maturity, overpressure, and permeability. Fortuitously, the pre-drill predictions by Burgundy were proven out by analysis of the core and logs from Icewine#1, marking the completion of the first phase of the project. The company is quick to note that while each of the Achilles Heels had the potential to kill the

MAP: 88 Energy Limited

project outright, the fact they have been de-risked does not guarantee success. Phase II is now underway with appraisal drilling targeted via the Icewine#2H horizontal well, which includes a production test. Drilling is currently scheduled for the first half of 2017, with the production test shortly thereafter. 88 Energy remains busy, despite headwinds from external factors and is currently finalizing the Icewine#2H design, processing and then interpreting the 2D seismic testing results for the site, completing the permitting process, finalizing the funding which includes securing strategic investment partners, and then drill and production test. Wall reminds that the process is technical, complex, and stretched on timing. There’s no fast-track for research, exploration, and ultimate drilling and production operations in Alaska at present, nor in coming years. The process must continue to be assiduous and environmentally responsible. Phase 1 of Project Icewine, involving evaluation of core and log data from the HRZ formation, is complete. The results helped conclude the HRZ may hold a liquids-rich resource of more than 1 billion barrels of recoverable oil and condensate on the current leasehold.

Great Optimism Estimates of potential flow rates and internal economic modelling indicate the oil price required for amenable development ranges are $27 per barrel at the lowest end to $68, depending on certain assumptions about the deliverability of the reservoir and the cost of structures (and availability) on the North Slope. There’s great optimism from the company, and Wall notes, “Icewine#1 provided excellent encouragement that there is a huge shale prize in Alaska in the HRZ formation.” Wall adds that following the next well’s testing results, “state economics will become front and center.” Wall admits developing shale in Alaska isn’t the same as in Texas, with differing demographics, logistics, and policymaking bodies. “Alaska has a strong history of major oil development, particularly on the North Slope, so we won’t be reinventing the wheel—just modifying it,” Wall says. “First steps first though, and we remain primarily focused on delivering a positive outcome from the next planned well, Icewine#2H.” R Tom Anderson writes from across Alaska.

Alaska Business Monthly | September 2016 www.akbizmag.com

OIL & GAS

Resources Energy, Inc. Spearheads LNG Development Company looks for investors for innovative Southcentral project By Julie Stricker

hile several large-scale proposals to develop and market Alaska natural gas have been discussed in the past decades, one spearheaded by a Japanese consortium has a plan and a goal and is steadily working to meet them. Resources Energy, Inc. (REI) wants to build and operate a liquefied natural gas (LNG) plant in Alaska that would provide relatively low-cost LNG to Japan. The project came about after the 2011 Fukushima earthquake and tsunami drove home the vulnerability of Japan’s nuclear energy system. In July, according to the World Nuclear Association, “forty-two of the country’s fifty-plus main reactors are operable and potentially able to restart, and twenty-four of these are in the process of restart approvals. The first two restarted in August and October 2015.” With energy prices rising at home, Japanese officials began to look abroad for new, clean sources of energy, focusing on Alaska, with its vast natural gas deposits. According to a January 2013 feasibility study, the project’s goal is to trigger an early flow of North Slope and Cook Inlet natural gas, which would answer Alaska’s energy needs as well as create opportunities for exporting LNG to Japan. The Cook Inlet LNG project would also be a springboard to future Alaska opportunities.

Advantage Alaska

A project based in Alaska has many things going for it, according to REI’s Vice President and Anchorage Office General Manager Mary Ann Pease, who joined the company in 2012. Pease gave an update on the project in July. The preliminary estimate of project values in September 2014 equaled “$2.85 billion; $1.35 billion for the LNG liquefication facility and power plant and $1.5 billion for feedgas supply and related infrastructure,” according to the REI LNG Export Project AIDEA Infrastructure Development Project Summary Matrix. Pease has a background in Alaska telecommunications and utility projects and also served as former Alaska Governor Frank Murkowski’s gas pipeline advisor. Pease also was a consultant to the Alaska 72

Natural Gas Development Authority. “Our schedule has been very consistent,” she says. “There is a window opening for the right amount of gas specifically that will come from this project—1 million tons—in the 2020 time frame. That is very much one of the guiding principles to this project.” The timing is right to create an export market to Japan, Pease says. The country has fully deregulated the electric industry and is in the process of deregulating the gas and the gas distribution system. “The timing of all that has come out nicely,” she says. Pease says she has run into few language and cultural barriers working with REI. “My Japanese is dismal,” she says, laughing, “but we have some people working for us who are fluent in Japanese.” Most Japanese, however, speak impeccable English and there is virtually no language barrier, she says. As far as cultural differences, Pease says she’s run into only a few. “The one big difference that I have seen and I’ve really finally learned to embrace is the importance of government-to-government relationships. It’s so much more important than it is here in the United States. “In Japan, that is held to the highest standard, that relationship to the government because they own so much of their industry infrastructure and they invest so much in their industry infrastructure.” The Bank of Japan sometimes acts as more of an import-export bank, she says. “They are always looking at strategic opportunities for investment and there is an existing relationship between Japan and with the state of Alaska,” she says. “One of its main missions is to promote overseas development of strategic natural resources. Can you imagine any of our banks having this mission?” Pease says she likes to use an analogy to describe how the business side of Japan works. “Japan through these individual corporations, acts as almost the sovereign,” she says. “They go out and invest in this country and that country. I think it’s very much aligned with what our governor is trying to do, which is bring in different entities and different countries to develop the gas line project.”

“What we’re looking at in addition to the Japan side right now is looking for a North American investor that would take on some of the risk up front.”

—Mary Ann Pease Vice President and Anchorage Office General Manager, Resources Energy, Inc.

The United States is the first country to supply LNG to Japan, which is the world’s largest LNG importer, according to REI. The project is “based on the over forty years’ experience and reliable relationship of LNG trade between the two countries.”

Clear Goal

“The goal is to ship out LNG in 2021,” Pease says. “That’s our guiding principle.” To begin with, Alaska has abundant conventional gas reserves. On the North Slope, most gas is reinjected into the wells because there is no feasible way to ship it to market. Japanese interest in North Slope gas could help spur efforts to build a pipeline, officials say. According to a US Geological Survey in 2012, Cook Inlet has 13.7 trillion cubic feet (TCF) of technically recoverable conventional gas resources and potentially 19 TCF. Cook Inlet also has established pipeline and storage systems. Local utilities are expected to need only a fraction of the available gas, even as expected demand increases from the current 1,600-2,000 billion cubic feet (bfc) per year to about 80 Bcf in twenty-five years. REI expects to ship 1,100 Bcf in 2021, increasing to 55 Bcf per year in twenty years.

Strategic Alaska

Alaska is strategically located for easy access to Asian markets. Alaska already has a fourdecade-long track record of delivering LNG to Asia and Japan, Pease says. Its proximity to Asia means it would only take about seven

Alaska Business Monthly | September 2016 www.akbizmag.com

days for LNG to be delivered. It wouldn’t have to traverse the Panama Canal, which means extra fees. Additionally, Alaska is not part of the shale debate in the Lower 48 and Alaska LNG doesn’t require a “cumbersome” Department of Energy review, Pease says. To gain access to the gas, REI will need to come to an agreement with the producers. In Cook Inlet, Hilcorp is the dominant producer. Others include Cook Inlet Regional Corporation, Furie, Blue Crest, ConocoPhillips, and Cook Inlet Energy. REI is seeking gas supply agreements and hopes to conclude those by December of this year, Pease says. As far as markets, the long-term prospects are promising. Current contracts are expected to expire from 2021 onward, providing a window of opportunity.

REMOTE EXTREME

Infrastructure

REI’s plans include the construction of an LNG plant near Port MacKenzie that would produce 1 million tons per year, or about 160 million cubic feet daily, using gas from Cook Inlet. REI has a purchase/lease option agreement in place that is valid through December 2016 for land that is generally in the Point Mackenzie area across from Anchorage. Point MacKenzie was chosen because not only it is near shipping lanes, but could serve as a hub for natural gas expansion from the North Slope and other sites in Alaska. The standard footprint for an LNG plant is 722 feet by 460 feet. REI is trying to optimize and scale it down to 590 feet by 361 feet. The greenfield Cook Inlet liquefication plant is estimated to cost $800 million to $1 billion. To ship the LNG, REI is looking at a couple of options. One would be to commission a tank ship with a carrying capacity of 135,000 cubic meters on a long-term charter. The carrier would hold self-supporting prismatic type-B tanks that are structurally strong and designed to reduce movement of the LNG. The carrier would make eighteen round trips per year between Port MacKenzie and Japan, each consisting of seven shipping days one way. That would result in a target shipping cost of less than one dollar per one million British Thermal Units (MMBtu). Right now, the project is in the optimization stage and is looking for investors, Pease says. “We have been in the past six months extremely focused on trying to consider more of the risk-capital investors because we’re in the early stage of the project development,” she says. “What we’re looking at in addition to the Japan side right now is looking for a North American investor that would take on some of the risk up front.” R Freelance journalist Julie Stricker lives near Fairbanks. www.akbizmag.com

COMPLEX SUCCESSFUL UNFORGIVING Conditions our offshore engineering team faces every day. With diverse global experience and intimate knowledge of Alaska, Crowley delivers offshore engineering solutions for projects no matter their size, scope, or environmental challenge. For your own rewarding experience, please contact Crowley today.

Crowley.com/MarineSolutions | 907.891.8241 ENGINEERING · VESSEL DESIGN · CONSTRUCTION MANAGEMENT FA C I L I T I E S E N G I N E E R I N G M A N A G E M E N T · M A R I N E O P E R AT I O N S & H E A V Y L I F T S E R V I C E S · O F F S H O R E E N G I N E E R I N G · A R C T I C LO G I S T I C S & O P E R AT I O N

September 2016 | Alaska Business Monthly

OIL & GAS Heavy Haul Road

FIGURE 1.3.1-1

Material Offloading Facility LEGEND

LNG Property Boundary LNG Facility Features LNG Train 1 LNG Train 2 LNG Train 3

! °

LNG PLANT OVERVIEW

Plant Entry

LNG Storage

Fractionation

Ponds

LP Flare

Refrig. / Cond. Stg. & Loading

Train 3 Utilities

Train 2

Operations Building and Control Room 0

250

500

DISCLAIMER

Nikiski Meter Station

Plant Entry Pond

PREPARED BY: EXP ENERGY SERVICES INC. 1:12,500 SCALE: 2016-06-03 SHEET: DATE: 1 of 1

RUSSIA

Train 1

1,000 Feet

The information contained herein is for informational or planning purposes only, It does not nor should it be deemed to be an offer, request or proposals for rights or occupation of any kind. The Alaska LNG Project Participants and their respective officers, employees and agents, make no warranty, implied or otherwise, nor accept any liability, as to the accuracy or completeness of the information contained in these documents, drawings or electronic files. Do not remove or delete this note from document, drawing or electronic file.

VICINITY MAP

Pond

Firewater Storage

Ground Flare

Arctic Ocean

Power

Gas Line to Inlet Treating

PRUDHOE BAY

CANADA

FAIRBANKS

ANCHORAGE

Bering Sea

Pacific Ocean

Potential Re-route Corridor of Existing Utilities

Phase IV, US ProposedKeystone Plant Boundary Alaska LNG

X:\Projects\ExxonMobil\SCLNG\Mapping\20160603_Resource_Report_Mapping_Draft_Rev0\RR1\Figure 1_3_1_1 LNG Plant Overview.mxd

Alaska LNG Provides More Details on Project Construction By Larry Persily This update, provided by the Kenai Peninsula Borough mayor’s office, is part of an ongoing effort to keep the public informed about the Alaska LNG project.

laska LNG would have to move tens of thousands of sheets of paper for permits and tens of billions of dollars to construct a North Slope natural gas project. But all that can be moved electronically. It’s the actual heavy moving on the ground, in the air, and across the sea that is described in the project’s latest filings with federal regulators. On June 15, the project sponsors filed two of twelve of their second round of draft resource reports with the Federal Energy Regulatory Commission, with more planned for July and August. The General Project Description (Report No. 1) provides 74

the most detailed look yet at how Alaska LNG would move construction material and workers into place and how they would build the most expensive energy project in North American history. Though more specifics will come in later reports, Report No. 1 said:  The project’s preliminary list includes thirty construction camps, fifty-three pipeline storage areas, ten contractor yards, and eight short rail spurs to the Alaska Railroad. The camps would range in size from skid-mounted mobile facilities for up to 120 workers to 1,200-person main camps-with an ever larger camp at Nikiski.  During construction, the work would affect almost seventy-two thousand acres, but just one-sixth of that area during operations.

 No more than three hundred workers would be housed in local accommodations at any time during the LNG (liquified natural gas) plant and marine terminal construction in Nikiski. A construction camp would be built at the site to accommodate up to five thousand workers at its peak. The LNG facility is the largest single component of the project.  Seward, a year-round, ice-free port, would be used primarily as a point of entry for pipe deliveries. The Alaska Railroad can deliver out of Seward to Anchorage, Fairbanks, and the pipeline mileage in between. The project would need about 115,000 fortyfoot-long pipe sections delivered to the right site at the right time, and much of it would move through Seward.  The steel pipe would come to Alaska with its protective coating already

Alaska Business Monthly | September 2016 www.akbizmag.com

applied. After unloading, the pipe would be trucked or railed to a double-jointing plant near each port of entry and/or near Fairbanks for welding into eighty-foot sections, which would be moved by rail or truck. Pipe destined for Beluga on the West Side of Cook Inlet and in Nikiski would be delivered by barge.  Whittier, on Prince William Sound, would be used primarily for containerized cargo, pipe and fuel, with rail and road access out of town.  “Anchorage would be the predominant point of entry for most of the project’s general freight [non-modularized items]. Once received at the port, the materials would be deployed … via rail, truck, and barge.”

Livengood, Nenana, Prospect Creek, Summit, and Talkeetna. Other landing strips are under consideration. Additional ports such as Homer and industrial docks in the Kenai area “may also be used in a limited capacity” until the project builds its material offloading facility in Nikiski. The project could potentially use Port MacKenzie on Knik Arm as a distribution center for the concrete-coated pipe that would be laid across Cook Inlet, but that would be “dependent upon completion” of the Alaska Railroad spur line to the port, Report No. 1 said.

More Information Was Expected in July, August The construction logistics information in Resource Report No. 1 does not provide a detailed discussion of how the project would and could affect Alaska’s transportation system, such as how the project would manage its truck traffic so as not to overwhelm existing roads. It’s a listing, not an impact study. That will come in Report No. 5, Socioeconomics, which Alaska LNG told FERC it planned to submit in July. That second draft of Report No. 5 will contain some impact and mitigation measures, with the final report, still expected late this year, to provide a more complete

In-State Gas Off-Takes

Report No. 1 also identifies three of the five off-takes that would be built into the main pipeline to allow gas withdrawals for in-state consumption: Milepost 441 (measured from Prudhoe Bay) to serve Fairbanks, Milepost 763 to serve Matanuska Valley and Anchorage users, and the end of the line to allow off-take on the Kenai Peninsula. The state is responsible for selecting the off-take points. “The size and location of the other interconnection points are unknown at this time,” the report said. The off-take points would be a valve and T-connection; whatever else is needed to condition and move the gas to customers would be handled by parties other than Alaska LNG. To build the North Slope gas treatment plant, 62-mile Point Thomson gas line and 804-mile main pipeline, compressor stations along the route, and the LNG plant in Nikiski and marine terminal, Alaska LNG has calculated it would need (preliminary numbers):  About 340,000 truckloads of equipment, pipe, supplies, gravel, and dirt.  15,000 railcar loads of pipe and construction materials.  Fifty-one barges in four years of sealifts to bring gas treatment plant modules to the North Slope.  As many as ten barges shuttling between the ports of Anchorage and Seward to bring material to the LNG plant site in Nikiski on a weekly basis for three years. In addition to barge traffic, the project estimates that 20,000 to 25,000 truckloads would be needed to haul materials from Seward and Anchorage to Nikiski.  About seventy helicopter landing sites.  Use of four airports: Anchorage, Fairbanks, Kenai, and Deadhorse; and ten landing strips: Beluga, Cantwell, Chandalar Shelf, Coldfoot, Galbraith Lake, www.akbizmag.com

Investing in Alaska’s Future:

24,200+ Total jobs supported

79% Alaska hire

$26 million+ Community giving in the last 5 years

$2.25 billion+ Taxes and royalties paid (2014)

Rick Rodriguez

Fleet, Roads & Pads Team Leader BP Alaska

Find out more about BP Alaska at alaska.bp.com

September 2016 | Alaska Business Monthly

Alaska LNG Resource Reports 1 through 10 Available Online By Larry Persily

laska LNG’s second round of draft resource reports Nos. 1 through 10 have been filed with the Federal Energy Regulatory Commission (FERC) and are available on the Kenai Peninsula Borough website. To select and download the reports go to http://www.kpb.us/mayor/ lng-project/lng-project-updates/909alaska-lng-resource-reports-1-and-10. The project expected to file its last two draft reports later in August: No. 11, Reliability and Safety; and No. 13, Engineering and Design Material. Some of the files are very large and download time will vary with Internet connection speeds. A few of the appendices to the reports (mostly data sheets) are too large to easily accommodate on the Kenai

Borough server. If you are interested in these documents, contact Larry Persily in the mayor’s office at lpersily@kpb.us. The reports also are available from the Federal Energy Regulatory Commission website at http://elibrary.ferc.gov/idmws/search/fercgensearch.asp. Enter PF14-21 for the docket number and set the date range for July 7, 2016, through July 26, 2016, to collect all of the resource reports and appendix files. The environmental and construction planning reports are the second drafts submitted to FERC—the first were submitted in February 2015—and will be reviewed by federal and state regulatory agencies. FERC also will accept public comments. Alaska LNG will fill in any remaining information gaps and provide additional details in its final reports. The final resource reports could be ready for

delivery to FERC by the end of this year, along with a complete project application, though partners ExxonMobil, BP, ConocoPhillips, and the state of Alaska are undecided on that next step due to weak market conditions, a global oversupply of LNG, and a lack of consensus on fiscal and commercial terms. FERC would use the final reports as the base for its preparation of the project’s environmental impact statement. The reports provide detailed information on pipeline routing, waterway crossings, community impacts and multiple environmental issues for construction and operation of the natural gas liquefaction plant and marine terminal in Nikiski, gas treatment plant on the North Slope, and 804 miles of pipeline connecting the two facilities. R

MORE THAN A CENTURY IN ALASKA AND COUNTING

www.foss.com Always Safe. Always Ready.

Alaska Business Monthly | September 2016 www.akbizmag.com

description of how the massive construction project will affect communities and what the sponsors propose to reduce those impacts. Alaska LNG’s May newsletter said Report No. 5 would weigh in at 3,500 pages. In addition to the General Project Description, the June 15 filing included Report No. 10, Alternatives, which explains why Alaska LNG picked Nikiski, on the Kenai Peninsula, as the best site for the LNG plant to produce and ship up to 20 million metrics tons of LNG per year, rather than the North Slope, Valdez, or elsewhere in the state. Reports that were expected in July are Water Use and Wastewater Discharge (No. 2); Fish, Wildlife and Vegetation (No. 3); Cultural Resources (No. 4); Socioeconomics (No. 5); Geological Resources (No. 6); Soils (No. 7); Land Use, Recreation and Aesthetics (No. 8); and Air and Noise Quality (No. 9). Alaska LNG’s June 15 letter to FERC did not specify when the reports would be filed in July. A second draft of Reliability and Safety (No. 11) was to be filed in August, along with the project’s first draft of Engineering and Design (No. 13) for the LNG plant. Alaska LNG notified FERC in the June 15 letter that it would not file another draft of PCB Contamination (No. 12) because the project footprint has not changed since the first draft, which determined no PCB contamination sites would be affected. The June 15 filing provides preliminary engineering design and project footprints and additional details on construction execution and schedule. Included in the more than five hundred pages are maps for the entire length of the pipelines, open-cut and directional-drilling drawings for waterbody crossings, pipeline right-of-way and ice road construction sketches, drawings for the trestle to deep-water loading berths in Nikiski, and an illustration of the pipe-laying barge that would be used in Cook Inlet. Report No. 1 also provides Alaska LNG’s responses to public and government agency comments that were submitted last year to FERC after the project’s first round of draft reports were filed in February 2015. Alaska LNG’s second round of drafts comes a few months later than originally expected, though the project’s June 15 report to FERC still shows submittal of final resource reports and a full project application possible in the fourth-quarter 2016. That would trigger FERC preparation of an environmental impact statement, which Alaska LNG expects could take two years.

The state is exploring its options to keep the project on track to first LNG production mid-2020s, including possibly taking a larger stake in Alaska LNG or even embarking on a state-controlled, state-financed North Slope gas project. ing and design) stage of the project, a commitment to spend almost $2 billion to obtain permits, final designs, and prepare for a construction decision by 2019, according to the state. Low oil prices and weak cash flow are among the reasons for the companies’ hesitancy, Keith Meyer, newly hired

head of the Alaska Gasline Development Corporation, told Alaska reporters in June. In addition, an oversupplied global LNG market and weak prices in Asia—the anticipated destination for Alaska gas—are not encouraging signs for the project’s $45 billion to $65 billion investment decision.

Partners Undecided on Next Step

The state’s partners in Alaska LNG-North Slope producers ExxonMobil, BP, and ConocoPhillips-have indicated they might “not necessarily” move ahead as planned next year to the full FEED (front-end engineerwww.akbizmag.com

September 2016 | Alaska Business Monthly

ENVIRONMENTAL RESOURCE REPORTS ONE THROUGH TEN

ENVIRONMENTAL REPORTS ONE TEN NOW AVAILABLE FOR YOURRESOURCE INFORMATION & THROUGH COMMENT

NOW AVAILABLE FOR YOUR INFORMATION & COMMENT

Making Alaska’s natural gas liquefaction megaproject a reality requires a lot of careful planning—about natural gas liquefaction megaproject 10,000Making pagesAlaska’s worth, to be exact. The purpose of these a reality requires a lot of careful planning—about reports is two-fold: first, project teams must identify 10,000 pages worth, to be exact. The purpose of these the proposed project footprint, the potential effects reports is two-fold: first, project teams must identify during construction and operation, and recommended the proposed project footprint, the potential effects mitigation measures to minimize those effects. Second, during construction and operation, and recommended the reports provide the necessary information needed by mitigation measures to minimize those effects. Second, regulatory agencies to make sound regulatory decisions. the reports provide the necessary information needed by regulatory agencies to make sound regulatory decisions.

Drawing from four years of field work, the reports are comprehensive—addressing onlywork, topics as are Drawing from four yearsnot of field thesuch reports wildlife, water, noise and air quality also including comprehensive—addressing notbut only topics such as Alaskawildlife, Nativewater, cultural resources, socioeconomics, visual noise and air quality but also including Alaska Native culturalThe resources, aesthetics and recreation. reportssocioeconomics, detail current visual aestheticsconditions and recreation. The reports detail current environmental within the project footprint environmental conditions within the project footprint identified through the project’s field work as well as identified through the project’s field work relevant information collected by others, and as usewell as relevant information collected by others, and rigorous models to predict potential impacts. Theuse reports rigorous models predict impacts. The reports look back at what hasto been andpotential look ahead to the back at what has been and look ahead to the futurelook to build the best project that efficiently develops future to build the best project that efficiently develops Alaska’s natural gas for the benefit of all residents. Alaska’s natural gas for the benefit of all residents.

The resource reports include updated engineering The resource reports include updated engineering and design work,work, new field studies data, input from and design new field studies data, input from stakeholders, and proposed mitigation measures. stakeholders, and proposed mitigation measures. Feedback from from the general public andand interested parties Feedback the general public interested parties is an essential part of the andand regulatory is an essential part ofplanning the planning regulatory process, and thoughts your thoughts opinions about process, and your and and opinions about thethe second draft resource reports are welcome. second draft resource reports are welcome. Once the reports are submitted to Federal the Federal Energy Once the reports are submitted to the Energy Regulatory Commission (FERC), they will be available Regulatory Commission (FERC), they will be available for public review. onlineonline for public review.

GENERAL PROJECT DESCRIPTION GENERAL PROJECT DESCRIPTION

This report provides an overview of the

This report an overview of the project,provides its construction and operations project, its construction and operations plans, and big-picture timetables for construction, plans,along and big-picture timetables for construction, with a map of the proposed infrastructure, along including with a map of the proposed infrastructure, the gas treatment plant, the 800 mile including the gas treatment plant, 800LNG mileplant. A proposed pipeline route, and thethe Nikiski list ofpipeline permitsroute, and approvals fromplant. regulatory proposed and the required Nikiski LNG A is appended to required this resource list of agencies permits and approvals fromreport. regulatory agencies is appended to this resource report.

WATER USE AND QUALITY

The report will identify the existing WATER USE AND QUALITY

groundwater and surface water The report will identify the use existing resources, and describe the project’s water groundwater and surface water requirements for the Nikiski LNG facility, the North resources, and describe the project’s water use Slope gas treatment plant, and facilities along the requirements for the Nikiski LNG facility, the North pipeline corridor. Identification of construction Slope gas treatment plant, and facilities along the procedures and mitigation measures are also included pipeline corridor. Identification of construction forprocedures locations and where streams or rivers may beincluded crossed mitigation measures are also byfor the pipeline. The report will also identify wetlands locations where streams or rivers may be crossed potentially affected or permanently by by the pipeline. Thetemporarily report will also identify wetlands project infrastructure and measures taken to minimize potentially affected temporarily or permanently by these effects during construction. project infrastructure and measures taken to minimize these effects during construction.

FISH, WILDLIFE, AND VEGETATION FISH, WILDLIFE, AND VEGETATION

This report describes existing fish, This report existing fish, wildlife anddescribes vegetation species wildlife and vegetation species and habitats in the project area. It assesses potential and habitats in the project area. It assesses potential effects to these resources from project construction effects to these resources from project construction and operations and proposes mitigation measures to and operations and proposes mitigation measures to minimize projectarea. area.Impacts Impactsonon minimizethose thoseeffects effects in in the the project protected fish and wildlife species are important aspects protected fish and wildlife species are important aspects covered in this report. covered in this report.

CULTURAL CULTURAL RESOURCES RESOURCES

This report report describes This describesthe the identification identification and andprotection protectionofof AlaskaNative Nativetraditional traditional cultural cultural sites Alaska sitesand andother other historic properties within the proposed historic properties within the proposedproject projectarea. area. protectthe thesites, sites,specific specific cultural ToTo protect culturalresource resourcelocations locations are notdisclosed disclosedin inthis this report report but are not but are arereported reportedtotothe the Office of History and Archaeology’s State Historical Office of History and Archaeology’s State Historical Preservation Office (OHA/SHPO) and FERC. Preservation Office (OHA/SHPO) and FERC.

SOCIOECONOMICS

At more than 3,500 pages, Resource

At moreNo. than Resource Report 5 is3,500 one ofpages, the most Report No. 5 is one of the most broad-ranging reports and discusses the communities broad-ranging reports discusses the communities potentially affected byand project construction and operations. Socioeconomic factors include population, potentially affected by project construction and employment, income, housing, health care, emergency operations. Socioeconomic factors include population, employment, income, housing, health care, emergency

1-855-550-5445 1-855-550-5445 1-855-550-5445

Alaska Business Monthly | September 2016 www.akbizmag.com

services, law enforcement, utilities (water, sewage, solid waste and energy), government revenues and expenditures schools and(water, transportation services, lawincluding enforcement, utilities sewage, (highway, rail,and marine andgovernment air), land use, tourism, solid waste energy), revenues and subsistence and public health. will also expenditures including schoolsThe andreport transportation look at the project’s socioeconomic benefits to (highway, rail, marine and air), land use, tourism, communities as the State. and subsistence as andwell public health. TheRevenue report will also look at sharing the project’s socioeconomic toin this benefits mechanisms will bebenefits included communities well as the State. Revenue and analysis in the as future. benefits sharing mechanisms will be included in this

analysis the future. The AlaskainLNG Project is working with the Alaska Department of Fish and Game and other experts to The Alaska LNG Project is working with the Alaska conduct subsistence harvest surveys, subsistence Department of Fish and Game and other experts to mapping and traditional knowledge interviews in conduct subsistence harvest surveys, subsistence communities potentially affected by the project. The mapping and traditional knowledge interviews in results of that work are documented in Resource communities potentially affected by the project. The Report 5. Additionally, the Alaska Department results of that work are documented in Resourceof Health and Social Services preparing a health Report 5. Additionally, the is Alaska Department of impact assessment for the project that will be appended to Health and Social Services is preparing a health impact Resource Report 5. project that will be appended to assessment for the Resource Report 5.

GEOLOGICAL RESOURCES GEOLOGICAL RESOURCES

This report examines geological This report examineswith geological features associated the features associated with potential project area. Geohazards, such asthe earthquake potential project area. Geohazards, such as earthquake faults and unstable soils, will be addressed, as will faults and unstable soils, will be addressed, as will gravel sites for the millions of cubic yards of material gravel sites for the millions of cubic yards of material that would be needed for construction. The report that would be needed for construction. The report includes planand and includesa apreliminary preliminarygravel gravel sourcing sourcing plan outlines potential reclamation measures. outlines potential reclamation measures.

SOILS SOILS

Pipeline through Pipeline construction construction through permafrost will be permafrost be covered coveredininthe the report, willhandling handlingmaterial material from report, asaswill from potential potentialdredging dredging operationsatatthe thePrudhoe Prudhoe Bay Bay dock dock and operations andequipment equipment offloading facility proposed for the LNG offloading facility proposed for the LNGplant plantsite. site.

LANDUSE, USE,RECREATION RECREATION AND LAND AND AESTHETICS AESTHETICS The report examines the use of land

The report examines the use of land affected by the project, including affected project, recreational including private, public lands as wellby asthe designated private, public lands as well as designated recreational areas or other special use areas. The potential effects areas or other special use areas. The potential effects to tourism during construction will also be addressed tointourism during construction will also be addressed this resource report. To the extent practicable, the in project this resource report. the extent practicable, the footprint wouldTo avoid recreational areas, and project footprint would avoid recreational areas, and

www.akbizmag.com

when that is not possible, the project will work with land managers and local organizations to develop sitespecific plans. when that is not possible, the project will work with

9 9

land managers and local organizations to develop sitespecific plans.

AIR AND NOISE QUALITY

This report shares data about AIR AND NOISE QUALITY

existing air quality and predicts This report shares data about and potential air emissions during construction existing air quality and predictsby operations. The models, which are reviewed potential air emissions during construction and the State of Alaska Department of Environmental operations. The models, which are reviewed by Conservation and the Environmental Protection the State of Alaska Department of Environmental Agency, make predictions at about 10,000 gridded Conservation and the Environmental Protection locations in the project vicinity. As Alaska’s largest Agency, make predictions at about 10,000 gridded project to date, the operation of the pipeline and locations in the project vicinity. As Alaska’s largest related require lotpipeline of fuel. and The report project to facilities date, the will operation ofathe also describes existing related facilities will requiresound a lot ofmeasurements, fuel. The reportidentifies potential sound levels associated with applicable also describes existing sound measurements, identifies equipment and those measures orapplicable equipment controls potential sound levels associated with proposedand to those reduce sound levels. equipment measures or equipment controls proposed to reduce sound levels.

10 10

ALTERNATIVES

The LNG plant site,

Theconstruction LNG plant site, techniques, and construction techniques, by andthe pipeline route alternatives, etc., considered pipeline route alternatives, etc., considered by the project and raised by regulators and the public are project and raised by regulators and the public are addressed in the report, including the best way to addressed in the report, including the best way to thread pipeline through sensitive thread thethe pipeline through sensitive areasareas of theof the state. This resource report also goes into state. This resource report also goes into detaildetail aboutabout the preferred location for the potential liquefaction the preferred location for the potential liquefaction facility. alternatives evaluated conform facility. AllAll alternatives evaluated mustmust conform to theto the purpose and need of the project. purpose and need of the project.

Please continue engaging Please continue engaging with our licensing process with our licensing process and provide your input. and provide your input. www.aklng.com www.aklng.com www.ferc.gov www.ferc.gov Docket no. (PF14-21-000)

Docket no. (PF14-21-000)

1-855-550-5445 1-855-550-5445 1-855-550-5445

September 2016 | Alaska Business Monthly

The state is exploring its options to keep the project on track to first LNG production mid2020s, including possibly taking a larger stake in Alaska LNG or even embarking on a state-controlled, state-financed North Slope gas project. Regardless of any potential change in the project development plan, and in preparation for the final reports and full application to FERC, Alaska LNG crews are out in the field for the fifth summer, surveying and walking about seven thousand acres of the project footprint, focusing on wetlands and cultural sites as they wrap up field work. In the first four seasons, crews covered more than forty thousand acres.

Project Schedule

If Alaska LNG sticks to the preliminary schedule in its latest draft of Resource Report No. 1; if it obtains FERC authorization and all other permits on time; and if the project partners can resolve their differences over commercial agreements, project operations, and taxes:  Site preparation at the LNG plant and initial construction camp development would start in the third and fourth quarters 2019. “A significant number” of the LNG plant facilities would be built as modules offsite and delivered 2021 through 2024.

 Pilings and concrete foundation work at the LNG plant site in Nikiski would start in 2020.  Site prep and construction start-up at the material offloading facility in Nikiski would start late 2019, with work to begin 2022 on the terminal’s 3,300-foot-long trestle to twin loading berths for LNG carriers.  The first of three liquefaction trains would start operations fourth-quarter 2025. The last of the three trains would start commercial operations in 2027.  After site preparations are complete, North Slope gas treatment plant construction would start with the first sealift delivery of production modules in 2023, continuing through 2027.  The 62-mile, 32-inch-diameter Point Thomson-to-Prudhoe gas pipeline would be built 2021-2022.  Construction of the 804-mile, 42-inchdiameter pipeline from Prudhoe Bay to Nikiski would be split into four “spreads” (manageable lengths), working at the same time from fourth-quarter 2022 to third-quarter 2024, with borrow sites, access roads, work pads, and right-of-way preparations starting in 2020.  The North Slope spread would start at Prudhoe Bay and lay 209.3 miles of pipe to south of the Dietrich River crossing. The Interior spread would work 192 miles, to Livengood on the south side of the Elliott Highway. The 195.6-mile Alaska Range spread would extend to south of Antimony Creek. The Southcentral spread would build the final 177.8 miles to Nikiski. “Clearing activities would typically occur in the winter season, and one to three years prior to each scheduled construction season,” the report said.  The eight compressor stations (at twenty-three to twenty-nine acres each) would be built 2021-2025 at Sagwon, Milepost 76; Galbraith Lake, Milepost 147.1; Coldfoot, 240.5; Ray River, 332.9; Minto, 421.7; Healy, 518.2; Honolulu Creek, 596.9; and Rabideux Creek, 674.7. A heater station would be built at Jack River, Milepost 561.6.  The pipeline work would require about 17 million cubic yards of granular material (gravel, shot and crushed rock, sand). A potential list of existing and new material sites will be included in Report No. 6. In addition, 11.4 million cubic yards would be needed for the North Slope gas treatment plant, with more details to come in Report No. 6.  The 28.4 miles of pipe along the bottom of Cook Inlet would be set in place 20222023, with work during ice-free months only.

Alaska Business Monthly | September 2016 www.akbizmag.com

Alaska LNG has not decided on its freshwater source for construction or plant operations, but planned to conduct aquifer tests at the site later this summer to help determine if it could draw from underground wells without harming the aquifer and local wells. LNG Plant and Marine Terminal

The LNG plant site is nine hundred acres onshore, with an additional eighty acres for a temporary work camp adjacent to the site. As of June 20, Alaska LNG had purchased about six hundred acres at the site, as recorded with the Kenai Peninsula Borough. The project is continuing discussions with property owners to assemble the remaining parcels. Alaska LNG does not expect any dredging would be required for the deep-water twin-berth loading facility. But substantial dredging would be required for the material offloading facility along the shore just north (about one mile) of the trestle to provide clearance for barges and ships to deliver pipe, modules, and other large components to the plant site. The offloading facility-sheet piles and all-would be dismantled when the job is done. Approximately twenty-one LNG carriers a month would load up in Nikiski when all three liquefaction trains are in production. In addition to producing LNG, the plant would remove from the gas stream about 1,100 barrels of condensate a day, which would be piped or trucked to customer(s). During site preparations, approximately 5 million cubic yards of material would be scraped and dug up at the site, with most of it reused as fill material. In addition, granular material such as gravel needed for the site “would be sourced from local quarries where practical … there are multiple quarries within a twenty-mile radius of the site.” Larger and harder rock to protect the shoreline will be needed too. “Granite (armor rock), if required,” would be an exception to the twenty-mile radius. “Local quarries do not contain armor rock of sufficient hardness,” Report No. 1 said. “Kodiak Island, approximately three hundred miles from Nikiski, is the closest known commercial source for granite.”

would be capable of holding 690,000 gallons each. And two concrete batch plants would be installed at the site, each capable of producing 120 cubic yards of concrete an hour. Alaska LNG has not decided on its freshwater source for construction or plant op-

erations, but planned to conduct aquifer tests at the site later this summer to help determine if it could draw from underground wells without harming the aquifer and local wells. The project expects three hundred thousand gallons a day would be its peak need during construction, with about half that flow needed during plant operations. Results of the project’s groundwater studies will be included in the full application to FERC.

Kenai Spur Highway Relocation

The LNG plant site would require removing 1.33 miles of the Kenai Spur Highway

REGISTER BY 27 SEPTEMBER AND SAVE UP TO $100 The world’s most focused and comprehensive Arctic event. St. John’s, Newfoundland and Labrador 24-26 October 2016 St. John’s Convention Centre ArcticTechnologyConference.org

ER NOW

Nikiski Construction Camp

A construction work camp would be built adjacent to the northeast corner of the LNG plant site, with capacity for up to five thousand workers, though that would be the peak census, not the everyday count. Double-steel-wall storage tanks (five) would be built to hold 50,000 gallons of diesel and gasoline. Freshwater storage tanks (two) www.akbizmag.com

Attend the only Arctic event backed by the combined reach and credibility of 14 of the world’s top engineering and scientific organizations and built with expertise representing every discipline.

September 2016 | Alaska Business Monthly

for safety and security, according to the June 15 report from Alaska LNG. The road would end with north and south gates to the plant site, and the highway would be relocated east of the site. “It is anticipated that the relocation would be completed prior to the start of project construction,” Alaska LNG said, particularly important since equipment and materials hauled up from the waterfront dock would have to cross the existing highway. Though it is discussed in Report 1, the highway move is outside the jurisdiction of FERC and will not be reviewed as part of its environmental impact statement. State and Kenai Peninsula Borough approval would be required. Alaska LNG proposes a two-lane replacement highway, with alternative routes “being evaluated with a variety of criteria including environmental features, potential impacts to local residents and businesses, right-of-way acquisition, traffic considerations, utilities relocation, geotechnical features, road design, and construction timing.” Report No 1 includes a map of “preliminary options under consideration,” updated from the multiple-options map the project presented to the public last fall. The map shows eight recommended alternatives, with the designations (ADF, AFH, KJF, etc.) reading north to south. For example, ADF would start near Milepost 26 on the Kenai Spur Highway and generally follow Island Lake Road to Miller Loop Road, before turning west and reconnecting to the highway south of Milepost 19. Alaska LNG said it would provide additional information on the highway relocation in its application to FERC.

Points of Entry

Test It, Then Ship It With our 1,800 sq ft control systems integration center, maintain your design flexibility and achieve cost savings not found elsewhere in Alaska. This center is ideal for performing full integrated testing of multiple diverse systems before sending them to the North Slope.

» Download info sheet @

www.aesolns.com/intcenter for more details.

Report No. 1 said, “The majority of materials and equipment would come by sea,” through the ports of Anchorage, Seward, Whittier, and Valdez; by sealifts to Prudhoe Bay; and by direct delivery to the LNG plant site in Nikiski. The Alaska Highway also would be used to bring material into the state, through Canada. “A detailed discussion on the existing conditions of Alaska’s transportation infrastructure and potential impacts” will be covered in Report No. 5 in July. However, even though the mainline would not pass through Fairbanks, Report No. 1 noted, “The Fairbanks area would serve as a logistics hub for the project construction activities given its central location in the state and existing transportation infrastructure (i.e., highway, railroad, and air).” The report acknowledges that additional highway pull-outs, road widening, weigh station expansions, truck staging, and wait-

Alaska Business Monthly | September 2016 www.akbizmag.com

ing areas may be needed and will be identified at a later time-such as a dock laydown yard and storage area expansion in Seward for parking, turning, and accommodating the heavy volume of pipe-hauling trucks. It refers to such work as “project-related third-party activity,” without specifying the third-parties that would undertake the highway, rail spur, and port improvements. Report No. 1 said the ports of Seattle and Tacoma would be major hubs for moving materials to Alaska. “Other key ports are anticipated to be Houston, Texas, and Panama City, Florida.” Seattle-Tacoma International Airport “would likely be a personnel hub and collection point for other Lower 48 and international labor pools for consolidated transportation to Alaska.” The Kenai airport “would function as the primary point of entry for personnel” at the LNG plant construction job, arriving aboard charter aircraft. “Project personnel from out of state, as well as the local Anchorage-based labor pools,” also would use charters to reach “Fairbanks, Deadhorse, or local airfields along the mainline corridor,” the report said.

WELD + AIR + POWER

When you need it. Where you need it.

truckwell.biz

VMAC RAPTAIR-MF MULTIFUNCTION SYSTEM

Prudhoe Bay Dock

Constructing the gas treatment plant at Prudhoe Bay to remove carbon dioxide and other impurities from the gas stream would require large modules brought to the North Slope by sealift. Alaska LNG proposes to build a new dock to accommodate the sealift barges and a new staging area. The dock would be built adjacent to the seawater treatment plant at Prudhoe Bay, with about one thousand feet of dock face, five or more berths, and twenty-eight acres dedicated to project activities. Dredging would be required. An onshore staging area of eighty-six acres also would be built.

Point Thomson Point Thomson, about sixty miles east of Prudhoe Bay, would supply about 25 percent of the initial gas reserves for the Alaska LNG project. But it would take more drilling to put the estimated 8 trillion cubic feet of gas into production. After years of work, Point Thomson in April started producing five thousand barrels of condensate a day, sending the flow through a new pipeline toward Prudhoe Bay, where the product is added to the trans-Alaska oil pipeline. It cost operator ExxonMobil and its partners about $4 billion to develop the field, which is currently recycling its gas back into the reservoir. To turn Point Thomson into a gas production operation to feed Alaska LNG would require seven new production wells from three new pads, according to the June 15 www.akbizmag.com

Surveying Mid-October through November 2016

2017 POWER LIST

The Ultimate Alaska Business Reference Guide Get your business listed FREE! Go to akbizmag.com/Lists-Surveys/ C AT E G O R I E S Top 49ers Corporate 100 Accounting Firms Advertising & Public Relations Alaska Native Corporations Architects & Engineers Associations Construction Conventions & Corporate Travel Economic Development Organizations Education Employer Services Energy & Power Engineering Firms

Environmental Services Financial Services Health & Medicine Insurance Interior Design Firms Law Firms Mining Companies Office Equipment & Supplies Oil & Gas Real Estate - Commercial Telecom & Technology Transportation & Shipping Unions Utilities

September 2016 | Alaska Business Monthly

filing with FERC. The report did not provide a cost estimate. The US Army Corps of Engineers would take the lead in the Point Thomson Gas Expansion Project environmental review. The expanded Point Thomson operation would be designed to produce 920 million cubic feet of gas per day and approximately fifty-seven thousand barrels a day of condensate, according to Alaska LNG’s filing with FERC.

Alternatives

“Early in the process,” the Alternatives Report (No. 10) said, the partners eliminated the North Slope as an option for the LNG plant site for multiple reasons.  The annual ice-free window for LNG carriers “is only about two to three months,” and providing reliable delivery schedules for customers outside that opening would require specialized ice-breaking carriers.  The Beaufort Sea is very shallow near shore, and a loading facility “would need to be either located tens of miles offshore” or pipelines inside an undersea tunnel would need to reach out to a loading platform three to five miles offshore.  Extensive dredging, fill, and shore work would impact whales, other marine mammals, and fish.

 Building the gas treatment plant and LNG plant at the same location would greatly increase the number of modules that need to delivered by sealifts to the site, extending to eight years or more the time needed for all the sealifts.  “The impracticalities as well as significantly higher costs eliminated the North Slope from further consideration,” Report No. 10 said. A North Slope LNG plant also would eliminate the pipeline that could deliver gas to Fairbanks and Southcentral Alaska and everywhere in between. The project also looked at building the LNG plant in Valdez (Anderson Bay), but determined the costs would be prohibitive, along with other challenges. The site to the south side of Anderson Bay rises steeply, and terracing (benching) would be required to prepare a level surface for the plant, the report said. “To accomplish this, extensive earthworks including blasting would be required over several years.” Alaska LNG estimated it would have to move 39 million cubic yards or rock and overburden. Building the facility would require two hundred acres of permanent fill in the bay. “In addition, there would be more than six-

ty acres of wetland lost in the development of the site and the need to fill in or reroute an anadromous fish stream.” A Coast Guard-required safety zone around loaded LNG carriers in transit would restrict other vessel traffic through the less-than-mile-wide Valdez Narrows, affecting LNG deliveries if carriers have to wait for the waterway to clear of traffic. Federal conservation designations since a 1988 environmental impact statement recommended Valdez for an LNG project now make the option much more difficult (the National Park Service designated the Gulkana and Delta as Wild and Scenic Rivers). The trans-Alaska oil pipeline uses the best route through the steep slopes of Thompson Pass into Valdez. “There are many locations where that additional space is unavailable, making this routing technically unfeasible without creating a new right of way down the mountain pass.” And although a pipeline route to Valdez would bring the mainline closer to Fairbanks, it would be much farther from Anchorage and the Matanuska Valley. R Larry Persily is the Oil and Gas Special Assistant to the Kenai Peninsula Borough Mayor’s Office.

We deliver. Advertisers rely on our print and online visibility to reach as many potential clients as possible statewide.

• Statewide Marine Construction • Design Build • Cook Inlet Crane Barge Support • Equipped with 6 pt. Mooring Systems

Bill Morris Advertising Account Manager Office (907) 257-2911 b_morris@akbizmag.com

Call me so we can discuss improving your marketing goals.

907-261-8960

Turnagain.build 84

(907) 276-4373 • Toll Free (800) 770-4373

akbizmag.com

Alaska Business Monthly | September 2016 www.akbizmag.com

TELECOM & TECHNOLOGY

Expanding Technology in the Arctic Rural residents benefit from continued build out By Julie Stricker

tudents in the village of Noorvik will soon get a chance to explore the great cathedrals in Europe, the walls of Macchu Pichu, or the volcanoes of Hawaii in high-resolution detail without stepping out of their classroom, thanks to the expansion of Alaska telecom GCI’s rural network. Virtual field trips are only one of many benefits of access to high-speed Internet, which is now reaching into some of the most remote parts of the state. Noorvik, a predominantly Inupiat village of about 650, is located north of the Arctic Circle and hundreds of miles from the Alaska road system. The push to get broadband to rural Alaska was stirred by federal stimulus funding in 2010. GCI broke ground on a network that would bring cutting-edge technology and communications to thousands of people in some of the most remote parts of Alaska, above and below the Arctic Circle. Since then, the Terrestrial for Every Rural Region in Alaska (TERRA) network has brought high-speed, low-latency broadband to dozens of villages, servicing more than forty-three thousand residents. In July, the company announced it was expanding to another ten villages in the Norton Sound and Kotzebue regions, as well as Noatak and Red Dog Mine. The TERRA network is a hybrid of fiber-optic and microwave technologies.

Big Risk Pays Off

Koyuk, Elim, Golovin, White Mountain, Stebbins, and St. Michael will be connected to TERRA. That will give residents access to high-quality video conferencing, which will improve health and educational opportunities in the region, GCI officials say. “GCI has brought high-speed Internet to some of the most remote locations on Earth,” Greg Chapados, executive vice present and COO of GCI says in a news release announcing the expansion. “We’ve seen how much a community can benefit from the improved medical care, improved education, and improved economic opportunities that accompany access to broadband. We’re truly connecting Alaskans to the rest of the world. The projects are hard and the environment unforgiving, but we’re an Alaska company and we don’t expect things to be easy.” The high-speed data streaming will allow students to take virtual field trips and interact with teachers and students around the globe. It also provides access to highquality medical care and specialists at larger hospitals. “With high-speed Internet access, our schools are able to leverage digital tools at a level that was not possible before,” said Annmarie O’Brien, superintendent of the Northwest Arctic Borough School District in a release. “Part of our district has been on TERRA for more than a year and the impact is phenomenal. We’re thrilled for the other districts to follow suit.”

Creating TERRA was a gamble for GCI, says Lewis Schnaper, vice president of GCI Business, but one that the comPartnering for Expansion pany celebrates. GCI is again partnering with “We’ve invested hundreds of Ericsson, a world leader in commillions of dollars in networking munications technology and rural Alaska that no one was willservices, for the expansion. The ing to build,” Schnaper says. “It two companies have worked towas a big business risk. And I’m gether for more than a decade glad we did it. TERRA is a really pioneering the delivery of teleexciting project. It’s changed the communications in harsh Arctic data landscape and it’s changed conditions. the quality of life in rural Alaska.” Schnaper The technology allows people At the end of 2016, the villagaccess to the network, regardes of Buckland, Kiana, Noorvik, Selawik, less of how extreme the environment they 86

live in is, says Angel Ruiz, chairman of the North American region for Ericsson. The company, based in Sweden, helped bring what it calls the Networked Society to Alaska. Forty percent of the world’s mobile traffic is carried over Ericsson networks, the company says. “Working with GCI on this project and multiple others throughout the last decade has shown the impact that high-speed connectivity can make on communities across Alaska,” Ruiz said in a release. In 2017, GCI also plans to connect one of the world’s largest zinc producers, Teck’s Red Dog Mine, and the village of Noatak to the TERRA network. “Red Dog is a world-class mining operation that requires world-class Internet service and this partnership is a win-win for GCI, Red Dog, and the residents of Noatak,” Martin Cary, GCI’s senior vice president of business services said in a news release. “Our team understands the challenges of building infrastructure and providing service more than one hundred miles north of the Arctic Circle.” It’s a big step for the region above the Arctic Circle, bringing benefits not only to Red Dog but to the people who work there and live in the region, says Henri Letient, general manager of Teck Red Dog Operations. “This partnership will help connect many more Northwest Arctic residents with important online services, while also providing business benefits to Teck Red Dog Operations and mine employees,” Letient said in a statement. “Bringing high-speed Internet connection to Noatak is a strong example of the local benefits generated by Red Dog and of our commitment to helping support local residents and communities.” Red Dog is the major employer in the Northwest Arctic Arctic Borough and is the sole private financial contributor to the borough in the form of PILT (Payment in Lieu of Taxes). The Red Dog mine is operated under an agreement with NANA Regional Corporation.

Alaska Business Monthly | September 2016 www.akbizmag.com

“The mining sector is a cornerstone of Alaska’s resource development economy and with more than 450 employees, Red Dog Mine is a major employer in the region and in the state,” says Heidi Drygas, commissioner of the Alaska Department of Labor and Workforce Development. “Red Dog is also leading the way in workforce development through the use of registered apprenticeships, creating career paths for Alaskans in the region. As Alaskans work to diversify our economy, we need to make sure that businesses have the tools and access they need to stay competitive.” When the links to Red Dog and Noatak are completed, the TERRA network will deliver high-speed Internet to eighty-four rural Alaska locations. How fast depends on how much of the capacity in the network end users buy, so there’s no one answer, Schnaper says.

Closing the Ring

Its continued expansion will allow GCI to “close the ring” on the network, Schnaper says. The ring is an enormous loop that starts in Anchorage and runs southwest through Dillingham, Bethel, and other villages on the Yukon Kuskokwim Delta. It heads north to Unalakleet and the Norton Sound region, then west along the Yukon

River before it turns south at Nenana and follows the Railbelt back to Anchorage. Right now there are breaks in the ring along the Yukon River west of Galena, which means communications can only travel oneway along the network, Schnaper says. “Closing the ring does two things,” he says. “It essentially doubles the capacity on the network because traffic can go in both directions. And it reduces single points of failure. If there’s an outage on any point right now, all the traffic behind is stopped until the problem is fixed.” Once the ring is closed, traffic can be routed around any single break. The ground-based network is far faster than the satellite network it’s replacing. “The latency on the system is very low,” Schnaper says, “about 15 to 20 milliseconds from Nome to the Outside. All these terrestrial services are very quick, as compared with satellite service with half a second delay.”

Room for Growth

While GCI currently provides satellite service to Barrow, the company is also watching the progress of Quintillion, an Anchorage-based telecommunications company that is building a high-speed terrestrial and subsea fiber-optic network that will

connect Alaska’s Arctic communities with networks in the Pacific Northwest. This summer, Quintillion is constructing the first phase of the project, which includes a subsea fiber-optic cable from Prudhoe Bay to Nome with spurs to Barrow, Wainwright, Point Hope, and Kotzebue. A new fiber-optic system from Prudhoe Bay south to Fairbanks will join existing networks in Anchorage and the Pacific Northwest. Eventually, Quintillion plans to link with subsea fiber-optic cables to both Europe and Asia. “GCI historically has used other carriers for parts of our network and to back up part of our network,” Schnaper says. “We currently do not have an agreement with Quintillion, but we are talking to them.” The TERRA project, which was sparked by stimulus funds, Schnaper says, has won multiple national awards. And there’s more work to be done. Ideally, in the future the TERRA network will encompass all of rural Alaska, Schnaper says. “We’ve got dozens of villages to go and there’s plenty of places we can continue to build out in Alaska.” R Julie Stricker is a journalist living near Fairbanks.

Bringing 21st century technology to the Arctic. Quintillion, headquartered in Anchorage, is building and will operate the Quintillion Subsea Cable System, bringing affordable high-speed Internet access to the Arctic for the first time. This is the first phase of a multi-phase project that will ultimately connect Europe and Asia with a 15,000 km fiber optic cable. Phase 1, in-service Q1 2017, will consist of a main cable trunk that will run off the coast of Nome to Prudhoe Bay, with branching lines into the coastal Alaska communities of Nome, Kotzebue, Point Hope, Wainwright, Barrow and Prudhoe Bay. New terrestrial fiber from Prudhoe Bay will connect to existing fiber from Fairbanks to the Pacific Northwest.

Qexpressnet.com www.akbizmag.com

September 2016 | Alaska Business Monthly

TRANSPORTATION

Alaska Business Monthly | September 2016 www.akbizmag.com

HEAVY HAUL FREIGHT Oversize, overweight loads By Tasha Anderson Alaska West Express Project Manager Steve Willford checks a heavy haul load on the dock at the Port of Anchorage, as the truck backs in for transfer of a 76-ton, 83-foot by 20-foot seismic boat onto an AML barge to complete the shipment from Prudhoe Bay to Seattle, where it was transferred to a ship returning to Europe. Photo by Judy Patrick / Courtesy of Lynden

www.akbizmag.com

September 2016 | Alaska Business Monthly

n the way to Ted Stevens Anchorage International Airport one evening I was driving in the opposite direction of a house traveling down Jewel Lake Road. It had been loaded onto a truck, was draped with the familiar yellow “oversize load” banner, and was being escorted by two ubiquitous white pilot trucks, also festooned with the bright warning. I worriedly eyed the angle of the truck and the median it was steadily approaching before dismissing my concern with a single thought: someone must have planned this out. And indeed, not just one, but many “someones” planned it out. Hauling oversize or overweight loads anywhere in Alaska requires significant planning; as STR Alaska’s Curtis Spencer says, “The logistics get really complicated.”

Complicated Logistics

Alaska Trucking Association Executive Director Aves Thompson recalls one example of how complicated a heavy haul project can be: In the 1980s the city of Anchorage constructed the A Street-C Street couplet, essentially building A Street to reduce traffic, congestion, and accidents in the C Street corridor. Accident rates at various C Street intersections, such as 15th Avenue, Fireweed Lane, Benson Boulevard, and 36th Avenue, were well above

the “3.0+ critical rate,” ranging from 3.32 (48 accidents in one year) at Benson and C street to 4.87 (59 accidents) at C Street and Fireweed, according to the “A-C Couplet Final Environmental Impact/Section 4(f) Statement” issued in 1982. In the course of building A Street, “they displaced probably fifteen or twenty houses along the A Street route,” Thompson says. “So all of those houses were relocated to the valley; they picked them up and moved them.” He says he was working for the state at the time and it was his responsibility to oversee the permitting process. He describes it as a “great little project” as fifteen or twenty people were able to buy homes at a “very reasonable” cost, but each one of the affordable homes was considered heavy haul and required a permit. It may be rare in Anchorage lately to see houses hauled to and fro, but the heavy haul industry is busy with a variety of other tasks. Steve Willford, project manager at Alaska West Express (part of the Lynden family of companies), says Alaska West Express provides heavy haul services “to, from, and within Alaska. With Lynden’s integrated marine and air services, our heavy haul capabilities include intermodal services that extend beyond where the road ends.” According to Spencer, STR also utilizes marine and other services when necessary, citing a recent project in Louisiana which required

moving a load by barge because it was too big for the road.

When One Needs a Permit

Thompson says that many issues can restrict a load’s ability to be carried on the road, but one of the most limiting is a load’s height: “You can move power lines, but you can’t move a bridge structure or an overpass,” he says. Spencer says that while they do haul loads up the Alaska Highway, they’re generally not what he’d label superloads. Spencer says, “We have a bridge out near Tok that only allows us to go so high, and there’s other issues when you’re get real heavy going through Canada to Alaska.” “Chapter 25 Operations, Wheeled Vehicles,” is an Alaska DOT&PF issued reproduction of the regulations of “17 AAC 25,” which outlines when a load must be permitted to travel on a public road in Alaska. In brief summary, a vehicle/load may not exceed 8.5 feet in width, 15 feet in height, and 53 to 75 feet in length, depending on the type of vehicle. Regarding weight, Thompson says generally loads over 100 tons will require a permit, though that is a broad generalization: more specific answers about weight requirements look at the weight on a tire per linear inch, the weight on axels or axel groups, the number of axels, distance between axels, etc. (Commercial Vehicle Size,

Alaska Business Monthly | September 2016 www.akbizmag.com

Weight & Permit Regulations can be found online at dot.alaska.gov/mscve). In December 2015 DOT&PF issued a “Superload Notice” stating that the Commercial Vehicle Customer Service Center requires an advance notice of five business days for permits for superloads, which it defines as being more than 150 feet long, more than 18 feet wide, more than 18 feet tall, or having a GVW (gross vehicle weight) of 250,000 pounds. Spencer says the reason the superload permit can take a week is that they have to perform calculations to determine if each bridge can handle the requested load. “You can get [other] permits back in an hour or couple of hours—typically it is one day on anything except a superload,” he says. Thompson says that once the permit is issued, it’s important for the transporter to load the truck and confirm it actually weighs what the permit request said it would. “Sometimes at the last minute someone will add another thing [to the load] and say: they’ll never notice another five thousand or ten thousand pounds. But the bridge will probably notice it.” He says that permits, once granted, may set out restrictions on how the load can be transported, including the time of day or speed that the vehicle can move. “Part of that is that on a heavy load, weight plus speed increases damage expo-

nentially,” he says. “If you’re going slow with a heavy load you don’t have the pressure, you don’t push the pavement up in front of you—but if you’re going fast you can, so it’s a matter of keeping your speed down.” Spencer says that typically the maximum weight that any carrier in Alaska can haul is 410,000 pounds, including the tractor trailer combination and the load itself due to bridge constraints “If you go over that, you have to get really creative with a lot of expensive gear. Or you go to dolly systems or perimeter frame trailers or you bring in specialized gear to do it.” For a little perspective on what Spencer means by “expensive,” a superload trailer can cost $1 million-plus. He says that whether a load is a superload, a piece of equipment, or just a truckload dictates the speed it can travel. “Sometimes it can be two full days to Fairbanks, and sometimes it can be longer,” Spencer says. “If you’re moving a 100 ton module you can be three days to Fairbanks and seven days to Prudhoe Bay.” Spencer also says that transportation times can also be extended if there’s construction on the road or heavy traffic.

What’s Being Moved?

Spencer says, “We pretty much work in every industry. Obviously oil is important

to us, construction, agriculture, and marine. We haul just about everything you can think of: buildings, wind towers, heavy equipment, oilfield modules. About the only thing we don’t do is refrigerated loads and moving personal household goods.” One of STR Alaska’s recent hauls was moving oilfield modules from various Anchorage fabrication facilities in Anchorage to Prudhoe Bay. Willford says projects Lynden has participated in include “refinery construction and upgrades, pipeline building andmaintenance, power generation upgrades, construction of gold mining facilities, wind power generation, various road and facilities construction, seismic research, and bridge girders, to name a few.” Many of their large projects have been in the oil and gas industry and include “oilfield modules and other commodities for various oilfield upgrades such as Lisburne, Milne Point, Kuparuk, Oooguruk, Alpine, Prudhoe Bay, and Point Thomson.” Additionally, he says, “there are several transports moving at any given time for various customers on an ongoing basis that may not be described as a project in itself. For example, we have just completed a large oilfield module move for one of our oilfield customers with another one slated to transport first quarter 2017.”

! W O N BOOK

Speed! 431 mph — Get to Bristol Bay and Dutch Harbor faster! Comfort! 35” seating pitch exceeds most 737 ﬁrst-class seats Saab 2000s available for charters throughout Alaska

www.penair.com

I 1-800-448-4226

Operating Saab aircraft since 1997 www.akbizmag.com

September 2016 | Alaska Business Monthly

The Obstacles

“Any time you get into the big trailers, they’re all unique and interesting,” Spencer says. Willford would agree, saying, “Every project or oversize transport can come with its unique set of challenges and problems to solve.” For an example Willford gives the Pogo Mine project: “Lynden was contracted to oversee the movement of needed heavy machinery, oversize camp modules, and all other goods to the remote mine site over a winter ice road, with the goal to supply the construction effort through the summer, until the 50-plus mile all season road was to be completed. This required more than five hundred inbound loads to be collected from all directions, transferred to a staging area, and then organized into daily supply convoys for delivery to the mine site seven days a week during a two-and-ahalf month period. The challenges included all of the previously mentioned obstacles of weather, very adverse terrain, as well as operation on an off-highway ice road. The work was ultimately completed successfully.” Thompson says a universal challenge to the industry is Alaska’s spring thaw: “What happens is the road freezes and then the subsurface freezes, and that stabilizes the road for the winter time. And then in the spring it starts to freeze and thaw and freeze and thaw and water develops in the subsystem there, and that makes the pavement susceptible to damage.” Spencer says that typically there are restrictions around the state ranging from April to June, though some years they start earlier, end later, or both. Thompson says those restrictions are set on a somewhat local level, for the obvious reason that the water content below a road can vary greatly in different regions of the state. “We’ve all become accustomed to it. We don’t like it, but we recognize the fact that we don’t want to tear up the road.” Willford of Alaska West Express says that nature is a huge obstacle in Alaska, but it’s certainly not the only one. “Being challenged by the environment is only one half of the equation. The other half of the equation entails the challenge presented by the geography of the road traveled getting to the delivery point. This may be the Dalton Highway, any number of other roadways in Alaska, or various ice roads to locations that would otherwise not be accessible in summer,” he says. On my return trip from the airport, I was happy to see that there was no house/trailer combination hung up on the median. Heavy haul projects may be complicated, but the experts get them done. R Tasha Anderson is the Associate Editor for Alaska Business Monthly. 92

Alaska Business Monthly | September 2016 www.akbizmag.com

ENERGY

Winter Energy in Rural Alaska Upterrlainarluta ‘Always getting ready’ By Julie Stricker

t’s a hot July day in the village of Eagle, but power plant mechanic Scott Helmer is already thinking about winter. The town and nearby Native village on the Yukon River near the border with Canada are cut off from the rest of the state when the Taylor Highway closes with the first major snowfall of the season, so planning ahead is essential. Eagle is powered by three diesel generators, as well as 24 kilowatts in solar panels that were put in place last summer, “but they don’t work at all in the winter,” he says. So getting the town’s fuel oil supply is key, and it’s something that must happen well before the first snows fall. The Yup’ik have a saying, “Upterrlainarluta,” which translates to “always getting ready.” For Alaskans who live off the road system, winter is coming. They have to plan far in advance to get through the state’s long, dark, frigid season. Air travel is available year-round, in most places, but it’s expensive, so most of rural Alaska relies on seasonal barges plying the river systems for bulk cargoes of food and fuel. 94

Eagle, with a population of 110 to 120, including the nearby village, is fortunate to be on the road system, even if it’s just seasonally, Helmer says. “We can stock up on food and supplies before the road closes in October,” he says. It’s not as easy as driving down to the corner store, however. The nearest large town is Fairbanks, 370 miles away, and traveling the Taylor Highway can be a white-knuckle experience. Parts of the 160-mile highway, which begins east of Tok at Tetlin Junction, are a gravel road barely wide enough for two vehicles to pass. It winds high along the Fortymile River, around hairpin turns and over treeless summits before it dead-ends on the Yukon River in Eagle. Fuel is trucked in from Fairbanks. “The truckers, if the road starts getting icy or sloppy, they will come in, but they don’t like to,” he says. In addition to the fuel needed for the city power plant, two commercial vendors truck in fuel the residents use for their vehicles, boats, snowmachines, and Toyo stoves.

Photo by Dan Bihn

Students and parents at Thorne Bay School can deliver firewood to the school boiler to help offset the cost of travel for sports.

“We have to have forty thousand gallons of fuel to go into the winter,” says Helmer, whose family moved to the remote town in 1972 when he was eight years old. “That doesn’t mean we burn all of it. We have to have enough of it to go through part of the summer” in case the Taylor Highway is impassible in the spring. Most residents also burn wood in their homes, which must be cut and dried months or a year before burning.

Embracing Biofuel

Some rural communities have embraced biofuel systems that burn either cordwood or wood pellets to heat public buildings such as tribal halls, washeterias, and schools. In Southeast Alaska, ten schools in the Southeast Island School District are turning to biomass systems. Thorne Bay, a community of 550 with a school enrollment of about 60 students, is the largest in the district. The community conducted a pre-feasibility study in 2007 and purchased two GARN boilers with a grant from the Alaska Energy Authority in 2012. They also poured a concrete slab

Alaska Business Monthly | September 2016 www.akbizmag.com

with in-floor heating for a greenhouse. The system went online in 2013 and heats the school, gym, and greenhouse. Cordwood is stored in crates built by the students. As a result, the school saved money on heat, a local man was hired to cut cordwood, and students are paid to stoke the boiler and stack wood. Some of the money goes toward sports activities. According to Devany Plentovich, a project manager at the Alaska Energy Authority, about thirty biomass plants have been installed around the state, most of which were in conjunction with the Alaska Energy Authority. “We work with the communities when they’re developing the project to make sure they understand the best way to implement it,” she says. Biomass is a lot of work, but the advantage is that it’s a local resource that also provides local jobs, she says. For instance, Tanana, a village of about 250 residents located 130 air miles west of Fairbanks, started converting its public buildings to biofuel in 2007. Today, the community has cut its fuel consumption in half and increased the demand for wood 40 to 60 percent, according to a report released by the Tanana Chiefs Conference in 2014. Local woodcutters are paid $300 per cord to collect, transport, and store a cord of wood. The community’s thirteen boilers use a combined total of about two hundred cords per year, so the city pays woodcutters $50,000 to $70,000 per year to harvest firewood. “That money goes directly to Tanana’s wood harvesters rather than to outside fuel oil companies, further bolstering the local economy,” the Tanana Chiefs Conference report states. Biomass also creates jobs to process the wood, stoke the boilers, and maintain the boilers. In Tanana, half of the cordwood is driftwood collected from the Yukon River. The rest is harvested as part of forest thinning projects or traditionally in a way to keep the resource sustainable in the future, the report says. In 2014, the cost of a gallon of fuel oil in Tanana was $5.75. For the same amount of heat, firewood cost about $2.70.

Planning Ahead

Using cordwood also requires planning and a dry place to store the wood. “We encourage the wood harvest to take place at least a year in advance,” Plentovich says. The wood must be dried much more thoroughly than many people do for household wood stoves. Wood must contain less than 20 percent moisture content and is burned quickly at high temperatures to maximize efficiency. The heat is conserved in water storage tanks and used for space heating and hot water. The boilers are EPA www.akbizmag.com

September 2016 | Alaska Business Monthly

LEFT: Kaiden Hughes, high school student in the Southeast Island School District, not only learns about energy in class but has a part-time job stoking the wood boiler at Thorne Bay School. BELOW: Students at Thorne Bay School designed and built these cribs to store a year’s supply of wood for the boiler. Photos by Dan Bihn

certified for air quality emissions. “If you’re burning wet wood, it dramatically decreases the efficiency and emissions are a lot more,” she says. Local wood harvests also have other benefits, Plentovich says. “It’s using a resource that in a lot of places is a waste product or for wildfire mitigation.” In Tok, which has narrowly escaped devastating wildfires in the past, wood that is being cleared around the school to create a wildfire buffer is also keeping the students warm in the winter. In Delta Junction, waste wood from a logging operation and sawmill is used to heat the school. Wood can be harvested around an insect infestation, such as beetle-killed spruce in Southcentral Alaska, Plentovich says. “You’re using something that would normally be a waste product that is now a fuel source.” Biomass does have a downside. It requires more manpower to operate and maintain a biomass boiler, requiring the city of Tanana to hire more staff. The boilers also require constant maintenance. Communities must retain their diesel systems as backup, just in case someone forgets to stoke the fire, Plentovich says. Other communities use wood pellets, which are manufactured in Washington state, Southeast Alaska, as well as a plant in North Pole. Wood pellets are “a high-energy, clean burning fuel that can be produced from wood chips, sawdust, logging and lumber mill residues, small-diameter trees and brush, low-quality logs, and almost any other wood and wood waste product,” according to the Alaska Center for Energy and Power. The pellets, which resemble rabbit food, contain more energy than wood and release heat in a more uniform manner. The downside is the cost of buying and transporting the pellets. Pellets have been embraced in several Southeast Alaska communities, led by Sealaska’s conversion of its Juneau headquarters to pellet heat in 2010, and as home 96

heating on the road system, especially in the Fairbanks area. For most other rural communities, the rivers are their lifeline.

Delivering Petroleum

Crowley Marine has been providing fuel distribution services in rural Alaska since 1953. The company employs more than 650 people and specializes in overcoming the weather and logistics difficulties of delivering fuel safely in remote areas. Crowley has a 39 million gallon petroleum capacity and serves 282 communities “from Ketchikan to Kaktovik and beyond,” says Sean Thomas, vice president of Crowley Marine. Crowley begins deliveries in early April and “we go 24/7 for the next six months,” Thomas says. Their fleet travels up the Yukon, Kuskokwim, and Kobuk rivers—as well as many other smaller waterways—delivering propane, home heating fuel, aviation fuel, vehicle fuel, and marine fuel. “We own and operate several tank farms on the Kuskokwim,” Thomas says. “Our barges resupply to our own tank farms. We also do what we call marine direct deliveries, which are deliveries directly off our barges to private tank farms.” Because of the current relatively low fuel prices, people in rural Alaska are stocking up, which is keeping Crowley busy. “High prices are bad for our business, which is a little bit backwards from what most people think,” he

says. “If prices are high, people can’t afford the fuel, or the food, or just living their lives.” And while wind turbines and other alternative sources of energy have proliferated in rural Alaska, Thomas says it hasn’t made much of a difference in demand for petroleum. “I think they are a good thing and help diversify the energy resources in the communities,” he says. “I don’t know that it affects the amount of fuel people are buying. Right now, people are stocking up and buying as much fuel as fuel as they can.” Warmer winter weather, however, is to blame for some decline in deliveries, he says. “We are constantly trying to deliver the maximum value to our customers,” he says. “The more volume you sell, the lower the unit cost is. For us, the more we sell, the more we can make the [lower] prices.” In the face of a changing climate, Crowley hasn’t changed its core mission, Thomas says. “We’ve worked very hard at giving value and new and innovative ways for customers to save money and to give them options on how they buy their fuel,” he says. “We’re constantly trying to be creative and offer the best deals we can. We’ve had a lot of success serving the needs of our customers throughout Alaska.” R Freelance journalist Julie Stricker lives near Fairbanks.

Alaska Business Monthly | September 2016 www.akbizmag.com

SPECIAL SECTION

Building Alaska

Transportation Infrastructure Alaska Airlines invests in Alaska By Tasha Anderson

n late July Alaska Airlines announced the selection of local architecture firm McCool Carson Green and general contractor Kiewit to construct a new $40 million dollar hangar on the east side of the Ted Stevens Anchorage International Airport, approximately half a mile from Alaska’s existing hangar facility. Marilyn Romano, Alaska Airlines regional vice president, says the current hangar was built in 1954 and was originally owned by Northern Consolidated Airlines. “We bought it to accommodate much smaller aircraft, to give you a sense of how we’ve grown,” Romano says. The new hangar, which will measure 105,000 square feet, more than double the space of the current hangar, will be capable of housing two Boeing 737-Max 9 aircraft, which are approximately 138 feet long and 40 feet tall with a wingspan of nearly 118 feet. Romano says that Alaska hasn’t yet received a 737-Max 9, even one of which wouldn’t actually fit in the current hangar: the wingspan is too great. Romano says that Alaska Airlines is retiring its fleet of 737-400s and as that happens “it becomes even more important that we have a bigger hangar. We can get two of the 737-400s into the hangar, but since we’re retiring all those we have to have a plan moving forward.” She continues, “It really sets us up for our state of Alaska operations to have our maintenance and engineering team to be able to work on those larger aircraft in a safe, warm environment. It sets us up for growth.”

August Groundbreaking

Alaska Airlines held an official groundbreaking August 22 with Alaska Airlines’ executives, representatives from Kiewit and McCool Carlson Green, and state community leaders. The property for the new hangar was purchased from Signature Flight Support and includes an existing structure that 98

needs to be demolished before construction can take place. Romano says Kiewit plans to have an RFP out to bid for the demolition of the current structure, fencing, and possible utility work to begin this fall. “The plan is for Kiewit to get as much of the ground work done as possible before winter sets in and then really hit the project hard next spring,” she says. Alaska Airlines anticipates the hangar being completed in the summer of 2018. However, that is only part of the plan Alaska Airlines has in Alaska. Romano says that Alaska Airlines plans to spend nearly $100 million in the state over the next five years, including the $40 million for the hangar. The other approximately $60 million is going toward updating some of Alaska Airlines’ terminals.

Terminal Updates

“Unique to Alaska and unique to Alaska Airlines is the fact that we own and operate eleven of the terminals where we fly in the state,” Romano says, including terminals in Barrow, Bethel, Wrangell, Petersburg, Kodiak, Kotzebue, Nome, Cordova, Yakutat, Gustavus, and Deadhorse. “Each one is being looked at individually,” she says. “For example two of them, Barrow and Kotzebue, are going to get an expansion: the footprint will be larger and they’ll be remodeled.” Other terminals will receive “a total reconfiguration of existing space to utilize it in a better way.” Romano explains that post 9/11, TSA needed space in the terminals. “It all happened quickly and no one looked at the best way to arrange all of it. So this is our opportunity to look at it and utilize the space in a better way to make the customer experience better.” She says that Kodiak is one of the terminals that will basically be a total reconfiguration of existing space. “At others, where the layout is good for the size of the space, we’ll do the light remodel, a refresh, and bring in our new branding,” she continues. Romano says that it’s important to Alaska Airlines that their terminals are comfortable and provide their customers with a positive space and experience. “Some of the more rural terminals, they’re gathering places in the communities,” she says. Family

and friends may spend some time waiting in a hub like Bethel. “[The terminals] become a special part of the community and we want that reflected in how they look.” All of the terminals will not be upgraded at once, but over the course of two to five years.

Freighter Conversions

Alaska Airlines is also planning to convert three of their 737-700 planes from passenger service to cargo in order to have a dedicated freighter fleet, “the majority of which will be in the state of Alaska,” Romano says. With the three planes Alaska Airlines will be able to offer scheduled freighter service in the state. One industry she mentions this would benefit is the fishing industry: “Especially during the fishing season, in addition to scheduled service, we will have the flexibility to bring in freighters when needed.” She says they expect to have all three 737-700s converted and in operation by the spring of 2017. Through all of their plans Alaska Airlines is looking forward to investing in Alaska. “We’re really excited about the investment,” Romano says, “it shows our commitment to the state, our 1,825 employees in Alaska, and our customers who call Alaska home.” R Tasha Anderson is the Associate Editor for Alaska Business Monthly.

Alaska Business Monthly | September 2016 www.akbizmag.com

A rendering of the new Alaska Airlines Maintenance and Engineering Hangar, which is slated to break ground this fall and be completed in the summer of 2018 at the international airport in Anchorage. Rendering courtesy of Alaska Airlines

www.akbizmag.com

September 2016 | Alaska Business Monthly

Solar Gains: Arctic Solar Ventures Aims to Power Alaska with the Sun By Susan Harrington

rctic Solar Ventures (ASV) is another up and coming business with principals who were all born and raised in Alaska. Founder and CEO Stephen Trimble, Vice President Jackie Savina, and VP of Business Development Chase Christie are focusing on commercial solar projects and on educating the public about solar power. “We want to be a part of a comprehensive solution for Alaska energy independence,” Trimble says. One ASV goal is to serve as a relationship builder among suppliers, financial services, contractors, and building owners. They are part of the global clean energy revolution and say there is a really big opportunity to capture the global surge for new business, new economies, and new opportunities with clean energy development in Alaska. Another ASV goal is to dispel people’s perceptions that it’s too dark and too expensive to have solar power in Alaska. They want to bust these myths and point to the state’s net metering program, in which participating electrical utilities act as a form of a battery for solar power and store excess electricity generated by solar as a credit for use in subsequent months. Costs have also been driven down so it is more economic than ever to include solar in new buildings and old, especially with the federal government’s 30 percent tax credit, which is available to any home owner or business who installs solar.

The Boardroom

Trimble founded the business last April, while he was running his previous energy consulting business out of The Boardroom. “After a while I convinced Jackie to join the company.” (Trimble and Savina are married.) She was with Beacon Occupational Health and Safety Services for six years working in project management and operations for their remote medical team. She’s been with ASV since January. Trimble designed the ASV logo in house. His back100

Photo courtesy of ASV

SPECIAL SECTION

Building Alaska

Arctic Solar Ventures Founder and CEO Stephen Trimble, VP Jackie Savina, and VP of Business Development Chase Christie take advantage of a sunny day in downtown Anchorage.

ground is in art, design, and science. Christie recently returned to Alaska from California—the solar capital of the United States, Trimble says, and has the experience and know-how. Christie says Alaska receives the same solar energy as Germany, which is the world leader in solar power with six times as much installed as the United States. He sees a lot of opportunity in Alaska for solar as a diversified investment opportunity. Christie joined ASV in May. His background is in solar design and installation and construction management. He was a construction project manager in the Bay Area for many years and through that came his interest in renewable energy, green building, and solar. He’s volunteered and installed solar in rural communities in Nicaragua, which he says is similar to the Arctic due to its remoteness. “I’ve been waiting for solar to catch on up here,” he says. “I found these guys and it was impressed by their vision for solar in

Alaska. I’m thrilled to be up here to educate people and one-day hope to see solar on every rooftop.” He is quick to mention other benefits of solar, such as the fact that adding solar increases property values, but the increase can be exempt from additional property taxes in municipalities that adopt the state code. This creates an opportunity to increase the value of a property without increasing the assessed tax liability to the owner. Plus, there are solar easements. Trimble says in 1980 the Alaska Legislature passed AS 34.15.145. That statute says, in part: “An easement obtained for the purpose of protecting the exposure of property to the direct rays of the sun must be created in writing and is subject to the recording requirements for other conveyances of real property,” which means a building owners access to the sun can be protected from future building obstructions.

Alaska Business Monthly | September 2016 www.akbizmag.com

Project Roster

In August, ASV was working on a commercial project for the building at 880 H Street in Anchorage. Eighty-six panels were to be mounted at a 30 degree angle on the rooftop and are calculated to provide 14 percent of the building’s annual electrical usage. Earlier in the summer ASV completed a residential net metered installation that will supply 81 percent of the home’s annual electricity with ten panels. The wiring enters through the attic for a clean, no wires visible installation, and Trimble says it’s a testament to how they want to design their projects. ASV has about forty projects in various aspects of development, Trimble says, from proposals to design to getting permits and ordering panels. They purchase all their panels from the SolarWorld factory in Hillsboro, Oregon—it’s their exclusive manufacturing supplier. The company has been making solar panels since 1975. Christie says SolarWorld warranty guarantees that after twenty-five years the system will produce no less than 80 percent of its first year output. This means installed systems have long lifetimes between thirty and forty years. The company employs high tech tools to calculate just how many panels are needed, what angle is best for placement, and a host of other data for engineering, construction, lifespan, and other related queries. The latest complex professional tool being used by ASV allows them to measure annual solar potential onsite during evaluations. This latest invention in the ASV toolkit helps the firm estimate energy production with exemplary precision and that data is integrated directly into their comprehensive analysis, providing exacting system production and correlated financial analysis. The company also uses satellite data and other sophisticated software programs to design and engineer optimal solar systems for any location in Alaska, or the world for that matter. ASV works with KeyBank’s solar equipment financing arm in Cleveland and with Wunder Capital in Boulder, Colorado. They say the 30 percent federal tax for installed solar is a great incentive for investing in solar power now. Last year, Congress extended the full credit through 2019, in 2020 it drops to 26 percent, in 2021 it drops to 22 percent, and in 2022 residential is dropped and the commercial credit is capped at 10 percent. As Alaskan investors have learned, tax credits need to be swiftly taken advantage of, and on this one, Christie says, “there is no limit.” R Susan Harrington is Alaska Business Monthly’s Managing Editor. www.akbizmag.com

September 2016 | Alaska Business Monthly

101

SPECIAL SECTION

Building Alaska

ABM’s Fall 2016 Construction Roundup

Compiled by Susan Harrington

onstruction projects throughout the state kept many busy this summer and work continues on some through the fall and winter. Some projects will take several years due to weather, logistics, or the sheer size of the endeavors.

Cape Lisburne

Orion Marine Group started work on Seawall Reconstruction at Cape Lisburne this year, a $41 million project for the US Army Corps of Engineers/US Air Force. This purpose of this project is to armor the shoreline adjacent to a mile-long runway. The shoreline has been eroded more each year with violent storms, and with the short four to five month construction season up along 102

the Chukchi Sea it will take four to five years to complete, which is slated for 2020.

Shishmaref

STG Incorporated is installing approximately 216,000 gallons of new fuel storage capacity along with new retail sales facilities for the community in the Alaska Energy Authority Shishmaref Bulk Fuel Upgrade project with construction starting this month and completion scheduled for September 2017.

Fairbanks

The UAF Power Plant, a multi-year project for the University of Alaska, is set to be completed by June 30, 2018. HaskellDavis JV is the general contractor for the two 140,000 pound/hour circulating fluidized bed boilers and 17MW steam turbine that will heat the UAF campus. Architect is Design Alaska.

G & S Mechanical USA, Inc. was awarded a $3.998 million contract for the FAI Checked Baggage System Recapitalization project. This federally funded project will include reconstruction of the Fairbanks International Airport baggage handling systems and ancillary infrastructure within the Checked Baggage Inspection System and Checked Baggage Resolution Areas as needed to support TSA’s Explosive Detection System equipment recapitalization program. March 30, 2017, was set for the project substantial completion date. Great Northwest was awarded an $8.963 million contract for three projects: FMATS Pedestrian Improvements – Stage 1, Peger Road Resurfacing, and Northern Region Signal Interconnect – Mitchell to Johansen. The first project consists of constructing pedestrian facilities along Davis Road,

Alaska Business Monthly | September 2016 www.akbizmag.com

US Air Force radar facility at Cape Lisburne. The Long Range Radar Station is accessed by the Cape Lisburne LRRS Airport owned by the US Air Force. Orion Marine Group began work this summer to reconstruct the eroding seawall. Photo by Ground Truth Trekking

Peger Road, Wilbur Street, and Lathrop Street. The second project consists of resurfacing Peger Road from the Alaska Railroad yard to 500 feet past Van Horn Road, and approximately 1,840 feet of Phillips Field Road, and the Peger Road/Johansen Expressway on and off ramps. The third project consists of upgrading the existing copper wire based traffic signal interconnect from the Mitchell Expressway to the Johansen Expressway. This project will complete a fiber optic network ring topology and improve capacity, reliability, and insurance from accidental line breaks. Completion date is September 30. Exclusive Paving was awarded a $2.311 million contract for the City of Fairbanks Pedestrian Facilities Upgrade & Aurora and Auburn Drive Resurfacing project. The project consists of the reconstruction of pedestrian facilities on Aurora Drive, Cowles Street, Lacey Street and 5th, 6th, 7th, 8th, 9th and 10th Avenues from Cowles Street to Noble Street, 10th Avenue from Noble Street to Steese Highway. This project will resurface 0.84 miles (4,440 feet) of roadway on Aurora Drive from Hanson Road to College Road. The existing asphalt will be removed, manhole and utility lids will be adjusted to match www.akbizmag.com

the new surface, and the new pavement will be striped. All work will take place on the existing road surface. Additionally, 0.83 miles (4,370 feet) or roadway and 0.67 miles (3,530) of bike path along Auburn Drive have been selected to be resurfaced. All work will take place along the existing surfaces. Project completion date is October 31. Exclusive Paving was awarded a $2.864 million contract for the Goldhill Road Bicycle and Pedestrian Facility. The project consists of widening the shoulders on Goldhill Road to accommodate bicycles and pedestrians. Improvements will also include resurfacing the roadway, approach work, signing, and striping. The project completion date is October 1.

Eielson Air Force Base

Design work started in June for the $25.8 million F-35A Flight Simulator Facility to be located at Eielson Air Force Base. McCool Carlson Green is contracted for architecture and interior design for the US Air Force on the 32,342-square-foot facility. Construction is scheduled to begin this month. Subcontractors include: R&M Consultants (Civil Engineer), PDC Inc. Engineers (Mechanical/Electrical Engineer), September 2016 | Alaska Business Monthly

103

Photos courtesy of GCI

A shelter used to house communication equipment in Selawik suspended in air.

Schneider Structural Engineers (Structural Engineer), Corvus Design (Landscape Architecture), Estimations (Cost Estimator), HDR (F-35A Consultant), and Jensen Hughes (Fire Protection). Slated completion date is October 2018.

Richardson Highway

Great Northwest, Inc. was awarded a $2.739 million contract for the Valdez River Eoncroachment Repairs project. This project proposes to raise the road profile of the

Crews in Selawik setting the tower in place.

Richardson Highway MP 6.5 by 4.5 feet and install a new fish passage culvert near the existing culvert. The project also proposes to reinforce the highway embankment with additional riprap at Richardson Highway MP 12.5. Completion is scheduled for October 31. In August, QAP was awarded an $8.986 million contract for the Richardson Highway MP 24-35 Resurfacing project. The project consists of removing and replacing asphalt, signs, guardrail, and culverts between approximately MP 24-35 of the Rich-

ardson Highway. There will also be safety improvements and additional turnouts/approaches installed. The project completion date is October 31, 2017.

Western Alaska

GCI marked a milestone in its highspeed broadband expansion project in August with the completion of tower construction in the Alaska communities of Koyuk, Elim, St. Michael, and Selawik, where crews laid foundations, erected the towers, and set up

Auctions done right since 1958. Add your equipment to the next Ritchie Bros. auction in Wasilla – Oct 8 Whether you’re gearing up for a new project or selling machines from your fleet, count on Ritchie Bros. We’re the world’s largest industrial auctioneer for one reason—we do auctions right. ▸ Both on-site and online bidding ▸ Every item sells to the highest bidder on ▸ Financing, shipping, refurb and other auction day services ▸ Secure yards for buyer inspections ▸ Hassle-free, all-inclusive service for sellers

Brent Davis Territory Manager

Equipment to sell? Call me at 1.360.523.4010 or visit

rbauction.com

Branding Ad AlaskaBusiness Business Monthly (Sep) |7x4.875 01278.indd 1 2016-07-14 3:39 PM 104 Alaska Monthly September 2016 www.akbizmag.com

Drone photo of the Kwethluk K-12 School, provided by Bethel Services Inc.

the communications shelters to house and protect the highspeed bandwidth equipment. STG Incorporated is providing design/build services to help GCI achieve their goals. Construction to lay the foundation for the tower and shelters began in Noorvik in August. Crews were set to being laying foundations and erecting the towers in Golovin, Buckland, Stebbins, and White Mountain once permitting was complete.

Photo by BSI / Courtesy of Stantec

Pilot Station

STG Incorporated is installing approximately five hundred thousand gallons of new fuel storage capacity for power generation and retail sales and relocating the existing diesel-fired power plant. This Alaska Village Electric Cooperative Pilot Station Bulk Fuel Upgrade project was underway in August.

Kwethluk

Work continued on the new $32.8 million Kwethluk K-12 School. The project began last fall and is scheduled for completion in fall 2017. Stantec Consulting Services, Inc. provided full architectural and engineering design services on the two-story, 48,500-square-foot replacement school set on driven piles. Bethel Services, Inc. is the general contractor on the Lower Kuskokwim School District project.

Celebrating

40 yearsof Excellence!

Kodiak

QAP was awarded the contract for the Chiniak Highway: MP 10-15 Pavement Preservation, and HSIP: Kodiak Bridge Rail Upgrades in Kodiak in late May for its bid of $10.388 million. This federally funded contract consists of two projects: one will resurface Chiniak Highway from milepost 10 to 15 and the other will replace bridge rails on multiple bridges. Contract work includes paving, drainage improvements, signs, striping, guardrail, and end treatments. The two projects are to be completed by November 1. Stantec Consulting Services Inc. provided design.

Aleknagik

The Aleknagik Wood River Bridge Project will construct a road from the Dillingham â&#x20AC;&#x201C; Aleknagik Road to Peter Krause Sr. Drive in the Village of Aleknagik. Aleknagik occupies both the north and south shores of Lake Aleknagik, but most of the population of the village resides on the north shore. Many lives have been lost crossing the lake in both winter and summer. This project will provide a safe link between the village and educational, commercial, and travel resources in Dillingham. The proposed roadway will be paved and have two 10 foot lanes with 5 foot shoulders. The bridge will be a two-lane bridge, www.akbizmag.com

@Ken Graham Photography.com

6591 A Street, Suite 300 Anchorage, AK 99518 Phone 907-562-2336 Fax 907-561-3620

www.davisconstructors.com

September 2016 | Alaska Business Monthly

105

440 feet long; using three spans over two piers spaced 170 feet apart, and providing a minimum of 40 feet of clearance above the river. About 2.5 miles of approach roadway will be constructed on both the north and south shores. To expedite the construction start date the project has been divided into two phases as shown on the map. The project is being completed in two phases. Phase I construction was completed by Mowat Construction, Inc., who began the work in April 2014. Phase II design and right-of-way acquisition were underway, and JJC Enterprises, Inc. was awarded the $6.391 million Aleknagik Wood River Bridge Construction Phase II project by DOT&PF this summer.

King Cove

The Aleutians East Borough commissioned Edmonds, Washington-based architecture firm design2 LAST, inc. for the $2.3 million building envelope replacement at the 43,000-square-foot King Cove School. After years of water leaks through the walls, windows, and parapet, UNIT COMPANY is completing the work for a new rainscreen wall system that will eliminate leaks and tighten the envelope for increased energy efficiency. The new system uses a non-toxic, red-list free, liquid applied WRB membrane that will

106

prevent liquid water from entering the walls, but will allow water vapor to escape. Other sustainable materials used include inert, mineral wool insulation; fiberglass furring strips to prevent thermal transfer; fiberglass windows; and aluminum metal siding panels. To remain true to the original design, the metal panels are installed in a horizontal orientation and are a similar color. In addition to the exterior work, the project included work to repair water damaged finishes on the interior of the school. Interior work is expected to be complete prior to the start of the fall school schedule. Exterior work is expected to be complete by the end of September, 2016.

Cold Bay

Northern Management Services, Inc. was awarded a contract for $2.259 million for the Cold Bay ARFF Addition. This federally funded project will construct a new addition to the existing Airport Rescue and Firefighting Building (ARFF) at the Cold Bay Airport in Cold Bay, Alaska. This addition will provide space for the airport ARFF vehicle and one additional snow removal vehicle.

Dutch Harbor

Orion Marine Group started the Unisea G1 Dock Replacement in Dutch Harbor in

Alaska Business Monthly | September 2016 www.akbizmag.com

King Cove School (below and facing page) is getting a new rainscreen wall system building envelope replacement. Photos courtesy of Aleutians East Borough

www.akbizmag.com

September 2016 | Alaska Business Monthly

107

FROM HIGHWAYS TO RUNWAYS... Worker safety and accident prevention is the highest priority for all operations.

February. The $13 million Unisea Seafoods project is expected to be completed this month. This project included demolishing an old dilapidated pile supported dock with a sheet pile bulkhead, with associated dolphins and catwalks, and concrete paved deck. This will give increased useable dock space and uplands.

Shemya

STG Incorporated started the Eareckson Air Station Fuel Pier Facility Repair project in June for the US Army Corps of Engineers. The refurbishment of the existing dock face with new protective coatings and anodes and the installation of new mooring bollards, bull rail, and lighting standards is scheduled for completion this month.

• Airport Runways • Roads • Highways

• Asphalt Products • Concrete Products • Pre-Stress

Quality Asphalt Paving 240 W. 68th Ave. Anchorage, AK 99518 Ph: 907-522-2211 Fax: 907-344-5798

MANUFACTURED INTERIOR CONSTRUCTION

Central Region

Sturgeon Electric Company, Inc. was awarded a $4.757 million contract for the CR Flashing Yellow Arrow ITS project. This federally funded project will upgrade signal supports, hardware, wiring, electronics, communications equipment, traffic management center, timing plans, and provide related items to accommodate flashing yellow arrows and multiple locations. Project completion is set for November 1. Granite Construction Company was awarded a $6.788 million contract for the HSIP: CR High Friction Surface Treatment project. This federally funded project will install hard aggregate surface treatment to increase friction at multiple locations within the Central Region. Project work also includes signing, striping, milling, and paving. Completion is expected by September 15.

Talkeetna

Ahtna Construction and Primary Products Corporation was awarded a $6.79 million contract for the Talkeetna Airport Improvements and Pavement Rehabilitation project by DOT&PF in late May. This federally funded project will resurface all existing pavement, construct a new Transient Apron, a General Aviation Apron, connection taxiways, taxilanes, a pathway, and access roads. Clearing for airspace obstructions is also included. The project is expected to be completed by August 30, 2017.

INDUSTRY SECTORS: Corporate Education Energy Government Healthcare Hospitality Residential • Largest Interior

Willow

Manufacturer in North America • We build statewide • Licensed General Contractor • Alaskan Native & Women Owned

www.akdirtt.com 108

907-440-1424

Stantec Consulting Services Inc. provided design on the pavement preservation project for 11 miles of Willow Fishhook Road, from Milepost 37.7 to the Parks Highway. Work began last November on the $8.594 million DOT&PF project and should be complete by October. QAP is the general contractor.

Alaska Business Monthly | September 2016 www.akbizmag.com

Palmer/Wasilla

QAP was awarded the contract for the Schrock Road Pavement Preservation, Mat-Su Area Roads Pavement Preservation (Group A), and Mat-Su Area Roads Pavement Preservation projects in May for its bid of $8.998 million. This federally funded contract includes three Pavement Preservation projects which will resurface thirteen roads in the area of Palmer and Wasilla. In addition to repaving, work will also include improvements to the Little Susitna Bridge (#1030), roadway structural section, drainage, guardrail, signage, and striping. Scarsella Bros., Inc. has the $4.639 contract for Lucas Road Improvements in Wasilla. The DOT&PF project is to upgrade Lucas Road to rural collector standards, extend the service life of the roadway, and improve safety.

Near Porcupine State Recreation Site Granite Construction Company was awarded a $2.643 million contract for the Glenn Highway MP 63 and 64 Erosion Protection project. This federally funded project will install erosion protection to preserve the Glenn Highway. Project work will include clearing and grubbing, riprap, base course, relocating existing signs, and topsoil and seeding. Project completion date is December 15.

www.akbizmag.com

Eklutna

Granite Construction Company was awarded a $10.696 million contract for the Glenn Highway: Hiland Road to Eklutna Pavement Preservation/Glenn Highway: Median Crossovers projects in late July by the Alaska Department of Transportation and Public Facilities. This federally funded contract consists of two projects: one will mill and resurface the mainline driving lanes of the Glenn Highway from the Hiland Road interchange to the Eklutna Road overcrossing. The project will also apply a sand seal to interchange ramps and rigid delineators will be installed from the Airport Heights intersection to Glenn/Parks interchange. The other project will grade, pave, and sign 4 median crossovers along the Glenn Highway. Completion date is July 31, 2017.

Girdwood

Granite Construction Company was awarded the contract for the Alyeska Hwy Resurfacing: Seward Hwy to Arlberg Ave and Alyeska Hwy: Pathway Rehabilitation (GF) project with its bid of $5.198 million. This federally funded contract consists of two projects. One includes the resurfacing, narrowing the roadway from Forest Station Access Road to the intersection with

Glacier Creek Drive, upgrades to meet current ADA standards, guardrail, structural bridge work, and striping. The other project will reconstruct and widen the paved pathway to restore usability and meet current ADA standards. Both projects also include drainage, utility relocation, and signage. Projects are to be completed by June 15, 2017.

Sterling

Pruhs Construction Company, LLC was awarded a $15.712 million contract for the Sterling Highway MP 114-135 Pavement Preservation project. This federally funded contract will resurface approximately 20 miles of the Sterling Highway from South Cohoe Loop Road to the Ninilchik River Bridge (No. 0669). The project will overlay existing pavement, include guardrail, guardrail end treatment, dig-outs, drainage, clearing, rumble-strips, signs, and striping. Completion is set for June 30, 2017.

Soldotna

Pruhs Construction Company, LLC was awarded a $3,688 million contract for the Sterling Highway: Soldotna Urban Pavement Preservation project. This federally funded project will resurface the Sterling Highway in Soldotna, Alaska from approximately one third of a mile south of the in-

September 2016 | Alaska Business Monthly

109

CONSTRUCTION

tersection with Kalifornsky Beach Road to Devin Drive. Project work includes paving, guardrail, drainage, signalization, ADA curb ramp improvements, signage and striping. Completion is slated for October 1.

Kenai

EMPHASIZING EXCELLENCE, COMMUNICATION AND CLIENT-FIRST OPERATIONS Construction (design/build, vertical civil and heavy civil) Remote and rural construction Consultation and project management

tunistaconstruction.com a proud subsidiary of

110

QAP was awarded a $7.898 million contract for the Kenai Spur Highway: MP 8-12.4 Pavement Preservation, Kenai Spur Highway: MP 9.8 & MP 10.2 Culvert Replacement, and Bicycle-Pedestrian Facilities Rehabilitation and Improvements projects. This federally funded contract includes three projects which will: plane and resurface the Kenai Spur Highway from MP 8 (Cole Drive) to MP 12.4 (McKinley Street); replace culverts at MP 9.8, MP 11.14, and MP 11.44 with fish passage culverts; line the existing twin culverts at MP 10.2; line or replace existing storm drain infrastructure as needed; upgrade existing bicycle and pedestrian pathways along several sections of the Kenai Spur Highway and Kalifornsky Beach Road; upgrade pedestrian ramps to comply with Americans with Disabilities Act (ADA) standards; and perform signing and striping. Project completion date is set for July 31, 2017.

Anchorage

Neeser Construction was awarded a $40.745 million contract for the Glenn Hwy and Muldoon Road Interchange Improvements project. This federally funded project will reconstruct the existing GlennMuldoon partial cloverleaf interchange into a diverging diamond configuration including reconstruction of the Glenn Hwy on/off ramps and reconstruction of Muldoon Road from Boundary Ave. to Golden Bear Drive. Associated improvements include new pedestrian pathways, illuminations, noise walls, water line relocating, landscaping and drainage modifications. Completion is set for October 31, 2018. QAP was awarded an $8.348 million contract for the AMATS: Abbott Road RehabPhase I project. This federally funded project will provide two-way left turn lane, add a second eastbound through lane at Lake Otis Parkway, flatten crest vertical curves, and rehabilitate the existing pathway from Lake Otis Parkway to Jupiter Drive. Project work will consist of grading, drainage, paving, signing, striping, and signalization. Completion scheduled for October 31. Bristol Construction Services, LLC was awarded a $9.982 million contract for the Seward Highway: 92nd Ave Connector project. This federally funded project will construct the first phase of the 92nd Avenue and Academy Drive separation project. This phase of the project includes a south-

Alaska Business Monthly | September 2016 www.akbizmag.com

bound auxiliary lane from Dimond Blvd. to 92nd Avenue, a southbound auxiliary lane from 92nd to O’Malley Road, reconstruction of 92nd Avenue from the Old Seward Highway to the Seward Highway, and a new traffic signal at the Old Seward Highway and 92nd Avenue intersection. Completion is expected by October 31. QAP was awarded a $4.196 million contract for HSIP: Johns Road and Klatt Road Intersection Improvements, Klatt Road Sight Distance Improvements, and HSIP: Bragaw Street at 16th Avenue Channelization Improvements. This federally funded contract consists of three projects. HSIP: Klatt Rd and Johns Rd Intersection Improvements project will construct a single-lane roundabout with work including lighting, drainage, and pedestrian facilities. Klatt Rd Sight Distance Improvements project will modify centerline profile and make improvements to drainage and pedestrian facilities. HSIP: Bragaw Street at 16th Avenue Channelization Improvements project will widen Bragaw Street by adding a two-way left turn lane between 16th Avenue and Debarr Road, work will include drainage improvements, pedestrian facilities, highway lighting, and retaining wall installation. Completion is scheduled for October 31.

Mass Excavation, Inc. began work in May and expects to finish in October on the $6.9 million Merrill Field – Taxiway Q project for the Municipality of Anchorage. Granite Construction Company was awarded the ANC Taxiway R Improvements & ANC Taxiway T Improvements in late May for their bid of $20,220,272.79. The federally funded contract includes two projects which will rehabilitate Taxiways R and T at Anchorage International Airport to provide adequate structural pavement sections, taxiway shoulders, and taxiway safety areas. Electrical improvements will include rehabilitation of in-pavement and elevated taxiway lighting systems and replacement of taxiway signs. McCool Carlson Green is the architect on the Alaska Airlines – New Anchorage Hangar, a 105,000-square-foot, $41 million project that was to start last month with completion slated for first quarter 2018. General contractor is Kiewit, and subcontractors include: CRW Engineering Group (civil engineer, survey), AMC Engineers (mechanical/electrical engineer, commissioning), Schneider Structural Engineers (structural engineer), Shannon & Wilson (geotechnical engineer), Coffman Engineers (fire protection), Corvus Design (landscape architecture), and Estimations

(cost estimator). (See related story this issue.) RurAL CAP’s Susitna View project at Third and Cordova in Anchorage is a multi-million dollar redevelopment of an existing 14,696-square-foot, four-story office building to provide twenty units of permanent supportive housing for homeless individuals experiencing mental and physical disabilities. It will also have seven offices, community outdoor space, common space, meeting space, and community kitchen space. Lumen Design, LLC is the architect; SR Bales is the general contractor. The south building façade is covered with solar panels to meet the AHFC minimum 5 percent energy offset requirement. Lumen designed the building for a six star energy rating. Work on the building began this spring and completion is anticipated by the end of September. General contractor Davis Constructors & Engineers, Inc. continues work on the Anchorage Museum Expansion. Work on the two-story, 31,067-square-foot project designed for the Anchorage Museum Association by McCool Carlson Green began in February and has a June 1, 2017 completion date. Also at the Museum, Davis is set to begin construction on the Anchorage Museum – Alaska Gallery Exhibit project this

YOU’VE BUILT A GREAT BUSINESS. Let us help you maintain it. “I’m continually impressed with Alaska USA’s response time to questions and requests. It’s always a pleasure and their customer service is top notch. For small businesses, time is money, and waiting for documents or answers can be costly. Thank you for taking care of Alaska’s little guys and keeping us moving right along.” - Chris Zagyva | Owner of Lionheart Construction, LLC

Call today to speak with a risk management consultant.

alaskausa.org/insurance | (800) 478-1251 www.akbizmag.com

September 2016 | Alaska Business Monthly

111

month. The 15,000-square-foot remodel is expected to be done in March 2017, and was also designed by McCool Carlson Green architects for the Anchorage Museum Association. Work is underway on the Providence Emergency Department Expansion project in Anchorage. The 6 Phases of Remodeling project is being designed by Architects Alaska and the general contractor is Davis Constructors. When complete, this project will expand the number of emergency department treatment rooms from thirtyseven to fifty, including two trauma rooms and pediatric emergency space. Construction will be completed in several phases. The new treatment rooms are anticipated to be fully operational in early 2018. Mass Excavation began work as the general contractor on Resolution Pointe Phase V for Hickel Investment Company in Bayshore. Lounsbury & Associates, Inc. are the engineers on the project that started in July and is expected to be completed in October. Work began in March on the ANTHC Education & Training Center for the Alaska Native Tribal Health Consortium in Anchorage, a $10 million, 53,000-square-foot, three-story project. Firms working on the project include: Rodney P. Kinney Associates (contract manager, civil engineer, survey), MCG Architects (architecture, interior design), along with subcontractors: AMC Engineers (mechanical/electrical engineer, fire protection), PND Engineers (structural engineer), Corvus Design (landscape architecture), and Estimations (cost estimator). Construction is to start in November with a 2017 completion date. General contractor Davis Constructors & Engineers, Inc. continues work on the Turnagain Elementary School Renewal, a $13 million, two-story, 56,775-square-foot remodel for the Anchorage School District designed by Nvision Architecture. Work started in May and the project is expected to be completed in August next year. Construction began in June on the $13.6 million Gladys Wood Elementary School, a 56,590-square-foot project for the Anchorage School District. McCool Carlson Green is engaged for architecture, interior design, and as educational planner. General contractor is Cornerstone General Contractors on the $13.6 million project. Subcontractors include: CRW Engineering Group (civil engineer, survey), RSA Engineering (mechanical/electrical engineer), PND Engineers (structural engineer), Shannon & Wilson (geotechnical engineer), Corvus Design (landscape architecture), and Estimations (cost estimator). Completion is scheduled for August 2017. R 112

Alaska Business Monthly | September 2016 www.akbizmag.com

Photo by Brian Wallace, courtesy of Sealaska Heritage Institute

Accolades

Compiled by Tasha Anderson

Photo by Nobu Koch, courtesy of Sealaska Heritage Institute

Sealaska Heritage has announced the winners of its two popular traditional food contests, held as part of Celebration 2016. The winner of the black seaweed contest is Dora Barr, and the winner of the soapberry contest is Doris McLean. Dr. Charla Brown, Assistant Professor of Human Resource Management at the University of Alaska Southeast, in Juneau, has been named a regional recipient of the 2016 ACBSP Teaching Excellence Award. The Accreditation Council for Business Schools and Programs recognizes individuals each year who exemplify teaching excellence in the classroom. Brown was honored, along with other regional recipients, at ACBSP Annual Conference 2016 in June in Atlanta, Georgia. She received a medallion and a $250 check. The National Waste and Recycling Association, a leading waste and recycling industry organization, awarded Solid Waste Services Department driver Mark Frazure with a Driver of the Year award for the public sector (small) category. Frazure, who is celebrating thirty-two years with SWS, operates one of the department’s transfer trucks. Transfer trucks transport waste from the Central Transfer Station to the Anchorage Regional Landfill, a thirty-twomile roundtrip. On average a transfer truck makes five daily trips to and from the landfill. Photo courtesy of Travel Juneau

Alaska Marine Lines and LTI, Inc. donated the transportation of a ceremonial totem pole from Bellingham, Washington, to Hoonah, Alaska, for a June 4 dedication in the Tlingit village. Carved by Scott Jensen, Jeff Skaflestad, and Fred Fulmer at Jensen’s Bellingham studio, the totem was requested by elders of the Chookaneidee Clan to replace an ancestral totem pole that, according to legend, served as a source of wisdom, protection, and direction for the clan’s shaman when the clan was located at Glacier Bay, Alaska.

Destination Marketing Association International has selected Kevin Crowley, Membership/Community Relations Manager of Travel Juneau, for its renowned “30 Under 30” program. The program focuses on identifying and developing the talent of destination marketing professionals, thirty years of age and under, through increased access and exposure to industry networking and thought leadership.

The U.S. Department of Agriculture Rural Development presented Wells Fargo with a Champion of Rural Housing award as part of USDA’s observance of National Homeownership Month. The award was presented to Franklin Codel, head of Wells Fargo Home Lending, for helping qualified rural residents obtain affordable mortgage financing. In 2015, USDA and Wells Fargo worked together to help 2,792 low-and moderate-income families and individuals purchase homes in rural America through USDA’s Guaranteed Loan Program.

Cook Inlet Tribal Council was recognized for its innovation and educational impact as part of the White House Champions of Change for Making event on June 17. Director of Youth Education and Employment Services Renee Fredericks accepted the award during a special ceremony in Washington. Ten individuals nationwide were selected by the White House for their personal passion and tireless efforts to make advances in technology and platforms, educational opportunities or spaces that empower people to become tinkerers, inventors, and entrepreneurs.

114

Alaska Business Monthly | September 2016 www.akbizmag.com

Alaska USA Foundation has donated $20,000 to the Children’s Lunchbox to aid in their mission to provide nutritious meals to at-risk children in safe community settings. The Children’s Lunchbox has a number of food service programs for children, including the Early Morning Snack Program, the Prepared Meal Program, the After School Meal Program, and the Weekend Food Program. All programs are designed to fill various food availability gaps in children’s lives.

Photo courtesy of Alaska USA Foundation

Alaska USA Foundation has also donated $5,000 to Alaska Legal Services Corporation (ALSC). The money will help ALSC continue their mission to provide high-quality civil legal services to low-income veterans and families, and disadvantaged people and communities.

Photos by Brian Wallace, courtesy of Sealaska Heritage Institute

Communications volunteer Dave Stroh is the 2016 recipient of the American Heart Association’s Communications Award, one of the top honors given to volunteers in the Western States Affiliate, which covers Alaska, Arizona, California, Hawaii, Idaho, Montana, Nevada, Oregon, Utah and Washington. Stroh’s award was presented during the AHA’s volunteer awards dinner in Los Angeles on June 6. The Communications Award recognizes outstanding communications efforts by an individual volunteer working to promote the positioning of the American Heart Association and its efforts to build healthier lives free of cardiovascular diseases and stroke.

Hungry Sea Lion, Best of Carving and Sculpture Division, by Jennifer Younger.

Txaamsem, Best of Show, by David R. Boxley.

Lax’o, Best of Sewing Division, by Kandi McGilton.

Eight artists have taken top prizes at Sealaska Heritage Institute’s eighth biennial Juried Art Show and Competition, and five young artists also placed in SHI’s new Youth Juried Art Exhibit. www.akbizmag.com

Tsimshian artist David R. Boxley won the top two awards: Best of Show and Best of Formline for his piece, Txaamsem. Tlingit artist Alison Bremner won 2nd place for Best of Formline for her print Cat Lady. Carving and Sculpture Division (wood and metal carvings and sculptures): Jennifer Younger won Best of Division and Best of Metal Category for her piece, Hungry Sea Lion and Art (Bugs) Nelson won Best of Wood Category for his piece, Raven Mask. Sewing Division (skin and fur, beadwork and other): Kandi McGilton won Best of Division and Best of Beadwork Category for her piece, Lax’o; Jennie Wheeler won Best of Skin and Fur Category for her piece, Sea Otter Coat; and Clarissa Rizal won Best of Sewing “Other” Category her piece, Northwest by Southwest. Weaving Division (Chilkat, Ravenstail and basketry): Clarissa Rizal won Best of Division and Best of Chilkat Category for her weaving, Chilkat Child; Tiffany Vanderhoop won Best of Ravenstail Category for her weaving, Ravenstail Apron; and Merle Andersen won Best of Basketry Category for her piece, Clam Basket. 2-Dimensional Division (paintings, drawings and prints): David R. Boxley won Best of Division and Best of Painting and Drawing Category for his drum Txaamsem, bring his total number of awards for that piece to four and Alison Bremner won Best of Print Category for her print Cat Lady, bringing her total number of awards for that piece to two. R September 2016 | Alaska Business Monthly

115

RIGHT MOVES Alaska Business Monthly

We are pleased to announce our newest addition, Account Manager Holly Parsons. With more than twenty years of marketing experience, Parsons has in-depth knowledge and understanding of marketing concepts, creative, Parsons and strategies from various industries. She received her BA from UAF with a double major in Journalism/Broadcasting and Speech Communication. She then completed her MBA from UAA.

First National Bank Alaska

Jennifer Brody is the new Branch Manager at First National Bank Alaska’s Parkway Branch. She will be responsible for business development, consumer loans, branch operations and customer service at First National’s location in East Brody Anchorage. Brody first joined First National as a teller in 2008. Equipped with more than ten years of banking experience in Anchorage and on the Kenai Peninsula, Sheila Lomboy was named Loan Officer and appointed Assistant Vice President. Lomboy will provide commercial banking Lomboy opportunities and other services to Alaska businesses.

Anchorage School District

Several new principal assignments for the 2016-17 school year were recently approved by the administration and Anchorage School Board.  Chugach Optional Elementary School Clare Fulp, formerly principal of Ravenwood Elementary School  Gladys Wood Elementary School - Cindy Hemry, formerly principal of Girdwood K-8 School  Mirror Lake Middle School - Alexandra Hagler, formerly assistant principal at Bartlett High School  Rilke Schule Charter School - Christopher Barr, formerly principal at Akiachak School in Akiachak, Alaska

116

 Service High School - Frank Hauser, formerly assistant principal at Dimond High School  Stream Academy Charter School - Adam Mokelke, formerly the principal at Burchell High School in the Mat-Su Borough School District  Winterberry Charter School - Robert Young, formerly a principal in the Kenai Peninsula Borough School District

Tesoro

Kate Blair has joined Tesoro as the Government & Public Affairs Manager for Alaska, based in Anchorage. In her role, Blair is responsible for state and local government and public affairs in Alaska Blair while working with the refining, logistics, and marketing leadership teams. She will also manage the community investment program through the Tesoro Foundation. Blair holds a Master of Science from Mercyhurst College and Bachelor of Science from Rochester Institute of Technology.

Anchorage Fracture & Orthopedic Clinic

Specialty-trained physical medicine and rehabilitation doctor Jared R. Kirkham, MD, has joined Anchorage Fracture & Orthopedic Clinic. After receiving his medical degree from the University of Washington School of Medicine in Seattle, Kirkham completed an internship in medicine and surgery at Virginia Mason Medical Center in Seattle and his residency in physical medicine and rehabilitation at The University of Utah in Salt Lake City.

Northrim Bank

Northrim Bank announced the promotion of Angela Bradford, AVP, Loan Compliance Assistant Manager. Bradford joined Northrim Bank in December 2014 as the loan and CRA compliance asso- Bradford ciate. She came to Northrim with more than twelve years of experience of branch operations with BBVA Compass in Montgomery, Alabama. Bradford has attended the ABA National Compliance School in San Diego, California.

R&M Consultants

Will Rhodes joined R&M Consultants, Inc. as a Senior Geologist in the firm’s Fairbanks office, expanding the firm’s service offerings locally in Fairbanks to include engineering geology and environmental services. Rhodes will be responsible Rhodes for supporting ongoing engineering geology and environmental work for a variety of civil and environmental projects, including subsurface investigations, site characterization, material site assessments, geologic mapping, engineering geology, aerial photo interpretation, geotechnical/environmental site investigations, technical report writing, and data analysis. Corey Prewett, EIT, CESCL, joined R&M’s Site Development Group in May 2016 as a Staff Engineer. Prewett provides civil engineering support on site development projects, including schools, universities, harbors, Prewett and other facilities. His responsibilities include AutoCAD drafting on building sites, including grading and drainage; submittal reviews; specification creation; and report review. Robert Colles, EIT, CESCL, joined R&M in May 2016 as Staff Engineer in their Airport Engineering Group and is responsible for providing civil engineering design support for airport and utility projects. Colles previously worked with R&M as an Colles intern in their materials laboratory for the past two summers before being hired fulltime after graduation from the University of Fairbanks Alaska with a BS in Civil Engineering.

Alaska Gasline Development Corporation (AGDC)

AGDC announced the appointment of Keith M. Meyer as its new President. Meyer is a seasoned energy executive with more than thirty-five years of industry experience, including fifteen years focused on liquefied natural gas Meyer initiatives.

Alaska Business Monthly | September 2016 www.akbizmag.com

Compiled by Tasha Anderson Denali Federal Credit Union

Anna Rosenberg has joined the Denali Federal Credit Union staff as a Marketing Officer. Rosenberg is responsible for coordinating the marketing efforts for Denali branches, Investment Services, Youth Programs, School Business Rosenberg Partnership, and special event planning. Rosenberg received her BS in Hotel Restaurant Management from Northern Arizona University. Francy Bennett has joined Denali Federal Credit Union as a Marketing Officer. Bennett is responsible for coordinating the marketing efforts for Denali Home Loans, Card Services, Business Services, and Business Bennett Lending. Bennett received her BS in Communications from Cornell University.

Greater Fairbanks Chamber of Commerce

Marisa Sharrah was named the President and CEO of the Greater Fairbanks Chamber of Commerce. Sharrah has been the community relations manager for Flint Hills Resources Alaska since August 2007 where she managed the Sharrah philanthropy program for North Pole and Anchorage, advertising campaigns, and the media relations. She led the groundwater contamination project and served as the designated spokesperson.

Arctic Information Technology

Arctic Information Technology announced the promotions of Meara Boling to General Manager of Platform and Infrastructure and Jaime Sherrer to General Manager of Business Applications. Meara Boling brings twenty years of experience in professional services and project and team management to her new role. Boling holds a BS in Business Administration from the University of California Berkeley. Boling

www.akbizmag.com

Jaime Sherrer is a seasoned consulting and project manager with more than seventeen years of ERP/IT consulting and management experience. Sherrer joined Arctic IT in 2009 as a project manager and operations manager and holds a BA Sherrer in Business Administration from the Montclair State University.

Credit Union 1

Credit Union 1 announced the addition of Jennifer Bernard to its Board of Directors. Bernard is a business professional with more than eighteen years’ experience in business development, management, sales, marketing, Bernard leadership, and education. Bernard received her Bachelor of Arts degree in Organizational Management and her Master of Business Administration degree from Alaska Pacific University. As a member of Credit Union 1’s Board of Directors, Bernard will help oversee the credit union’s business strategy, development, and growth.

Alaska USA Mortgage Company

Kirsten Forbess has been promoted to Assistant Vice President for Wasilla. Forbess has been in finance for twenty-eight years, with fifteen years in the mortgage industry and eleven years with Alaska USA. She attended Bowling Forbess Green State University and was Valley Board of Realtors Convention Chairperson from 2006 to 2009, as well as Valley Board of Realtors Affiliate of the Year in 2009.

DCI Engineers

Jeremy Ryan, PE, SE, LEED AP, BD+C, joined DCI Engineers as a new Associate at the Anchorage office. He brings more than ten years of structural engineering experience in technical design, construction administration, and project Ryan management. He is a licensed Civil and Structural Engineer in both Alaska and California.

Sava White, EIT, joined DCI as a Structural Project Engineer. White became interested in structural engineering after working in the construction industry, specifically in the commercial and residential sectors. He also has experience White in environmental remediation engineering. He acquired his Bachelor of Science and Master of Science in Civil Engineering at the University of Alaska in Anchorage.

UAA ISER

Dr. Ralph Townsend has been named to lead ISER beginning in August. Townsend has nearly thirty years of experience in higher education and government, including research, administration, and Townsend teaching. Townsend earned his PhD in economics from the University of WisconsinMadison.

Huna Totem Corporation

Huna Totem Corporation Board Chair Russell Dick will take the reins as CEO and President starting October 1, 2016. Outside of Huna Totem, Dick gained valuable business acumen as the CEO of Alaskan Dream Cruises, a private, Dick Tlingit-owned small ship cruise line, and as the president and CEO of Haa Aaní LLC, a subsidiary of Sealaska Corporation. He’s served as the vice-chair of the Alaska Industrial Development and Export Authority Board since 2013.

Ukpeaġvik Iñupiat Corporation (UIC)

Greg Solomon received a promotion as the Director of Marketing and Graphic Design with UIC. Solomon has more than twenty years of experience in the advertising and marketing fields, and also fifteen years in the Information Solomon Technology industry. His academic credentials include attendance at Interlochen Arts Academy in Michigan, the University of Texas at San Antonio, and the University of Alaska Anchorage. R

September 2016 | Alaska Business Monthly

117

Inside

Alaska Business September 2016 GCI CI RED Internet customers will now have more available data, up to one terabyte from 750 gigabytes, at no additional cost. Other GCI No Worries Internet plans will receive an increase in data and speeds later this year. With one terabyte of data, GCI customers can stream seven hundred hours of HD video and play upwards of twelve thousand hours of online video games every month—that’s sixteen hours of online game time per day. The increase in data comes on the heels of GCI’s recent 1 GIG RED Internet expansions. With 1 GIG now available in Anchorage, Fairbanks, the Mat-Su Borough, and Juneau, GCI continues to provide the fastest Internet speeds to more Alaskans than any other provider. The upgraded Internet plans were created based on GCI’s ongoing customer surveys and listening sessions. GCI’s commitment to Alaskans’ customer experience allows the company to respond to the unique Alaska marketplace in a way unlike any other provider. gci.com

ASTAC AND AT&T ireless service just got better and faster for Arctic Slope Telephone Association Cooperative’s (ASTAC) Barrow customers. ASTAC, in collaboration with

Compiled by ABM Staff AT&T, has upgraded its wireless service from 2G to 4G in Barrow, bringing the first HSPA+ high-speed data service to the region and with it, new opportunities. The new service extends miles out to sea and onto the tundra. Customers will now also be able to enjoy streaming media, picture messaging, and shared data plans. ASTAC signed a long-term strategic agreement with AT&T earlier this year to enhance North Slope wireless service. ASTAC has already brought 4G speeds to Prudhoe Bay and the Nuiqsut markets. The other villages ASTAC services, Kaktovik, Atqasuk, Point Hope, Wainwright, Point Lay, and Anaktuvuk Pass, are scheduled to be upgraded to 4G by year end. astac.net | att.com PREMERA BLUE CROSS remera Blue Cross Blue Shield of Alaska filed a rate increase of 9.8 percent for 2017 individual metallic plans. The rate increase is significantly lower than past rate increases for 2015 and 2016. This is due to recent action by the Alaska State Legislature to create a state-based reinsurance program that stabilizes rates by spreading high medical costs across a broader base. Had the Legislature not passed the reinsurance legislation, Premera’s 2017 rate increase request would have been more than 40 percent, based on medical claims data

from 2015. Premera Blue Cross Blue Shield is the only remaining insurance carrier offering plans on the Federally Facilitated Marketplace for 2017 in Alaska. commerce.alaska.gov/web/ins/ ENROLL ALASKA he Premera Blue Cross Blue Shield of Alaska rate increases will not impact individual’s health insurance coverage until January 1, 2017. Enroll Alaska is available to be a resource to all Alaskans and will walk individuals through the enrollment process. There are no fees to applicants or clients for their professional services. The Federal Poverty Level for Alaska is also increasing. This has the potential to affect the subsidy amount individuals will be eligible for in 2017. Discontinuation notices may be sent to members for various reasons, to include plan name changes and significant premium increases. This will require individuals to act and select a new plan or renew the existing plan during Open Enrollment, which runs from November 1, 2016 to January 31, 2017. enrollingalaska.com

UAF niversity of Alaska Fairbanks researchers have received $2.2 million to study Arctic marine ecosystems while on board the ice-capable Sikuliaq, a $200 million

Your Project, Our Responsibility. 24/7 Service Pacific Pile & Marine has a robust fleet of marine equipment including our recent addition of a 600-Ton 4600 Ringer.

www.pacificpile.com I (907) 276-3878 276-3873 118

From critical lifts to platform support, PPM is sufficiently resourced to deliver a wide range of construction services. 620B East Whitney Road I Anchorage, AK 99501

Alaska Business Monthly | September 2016 www.akbizmag.com

research vessel owned by the National Science Foundation, operated by the UAF School of Fisheries and Ocean Sciences (SFOS), and homeported in Seward. The project will help researchers better understand the processes that prime oceans for summer productivity and better anticipate changes resulting from declining ice cover. Six SFOS researchers, along with staff, students, and international collaborators, will study oceanography and food web dynamics in the northern Bering Sea and southern Chukchi Sea through the North Pacific Research Board’s Arctic Integrated Ecosystem Research Program with fieldwork in early spring 2017 and 2018. uaf.edu/sfos/ ALASKA MARINE LINES laska Marine Lines celebrated the launch of its newest barge, Skagway Provider, at a ceremony July 7 at Gunderson Marine in Portland, Oregon, where the vessel was constructed. The heavy deck cargo barge was to make its maiden voyage from Seattle to Southeast Alaska July 29 and begin serving Alaska Marine Lines customers on the Seattle to Southeast Alaska route. The Skagway Provider’s 360-foot by 100-foot by 22-foot hull has capacity for 13,200 tons of cargo or about eight hundred 20-foot containers. It is in the same class as Alaska Marine Lines’ barges Sitka Provider, Southeast Provider, and Stikine Provider. Alaska Marine Lines is part of the Lynden family of companies. lynden.com/aml/

ALASKA GROWN he Alaska Grown Source Book website featuring farms and farm-related businesses across Alaska has been updated and published at http://dnr.alaska.gov/ag/ sourcebook/sourcebookindex2016.html. The source book includes contact information for more than three hundred farms and highlights their products and where they can be purchased; it also includes in-

formation for farmer’s markets, Community Supported Agriculture vendors, U-pick locations, and farm-related businesses. The website is organized by regions and has a search and sort function to help locate specific items. dnr.alaska.gov/ag/

Avenue, customers are guided by a Sleep Professional and receive an individualized sleep experience that helps them understand their sleep needs and find product solutions to achieve their best sleep. sleepnumber.com

HIGHLAND ACADEMY ighland Academy Charter School, previously known as Highland Tech Charter School, recently changed its name to better reflect the school’s philosophy, mission, and vision. Highland Academy is a small, integrated, competency-based school for students in grades six through twelve. The school’s focus is on students taking ownership of their learning. highlandacademy.asdk12.org

ALASKA RAILROAD ickets are available for the Alaska Railroad’s Aurora Winter Train, which will increase its usual schedule of traveling north from Anchorage on Saturdays and south from Fairbanks on Sundays with stops in Railbelt communities such as Wasilla and Talkeetna from September 24, 2016, through May 14, 2017. Travel north from Anchorage on December 27 and January 3 and south from Fairbanks December 28 and January 4 has been added. From February 21 through March 29 northbound trains are added on Tuesdays and southbound trains on Wednesdays. Service increases March 4 through 19, giving Alaskans and visitors a chance to spend spring break exploring Alaska by rail, heading north from Anchorage on Tuesdays, Thursdays, and Saturdays; southbound trains will depart Fairbanks on Wednesdays, Fridays, and Sundays. Tickets are now available. alaskarailroad.com

SLEEP NUMBER leep Number opened its first store in Alaska in June. At the new Anchoragearea store, located at 320 West 100th

MAT-SU BOROUGH n June 30 the Philippine Red Cross took ownership of the Susitna Ferry from the Mat-Su Borough, paying $1.75 million for the vessel, having already paid $250,000 for the purchase of the ship and $60,000 for operations costs. Before the sale could proceed, the ship engines had to be repaired due to water damage for approximately $3 million. The vessel successfully performed sea trials June 23. Originally a landing craft prototype for the US Navy, the Susitna is capable of operating as both a cargo-loaded barge that can haul itself onto shore as well as a twinhulled vessel that cuts through choppy seas with greater ease for passengers. The ship changes modes by lowering or raising its barge deck, changing its draft from four feet to fourteen feet. The Susitna will serve as a mobile clinic and hospital ship, serving some of the isolated 7,107 Philippine islands during the all too frequent disasters. matsugov.us | redcross.org.ph ANCHORAGE DOWNTOWN PARTNERSHIP | EASYPARK nchorage Downtown Partnership, Ltd. and EasyPark combined forces to launch a new and enhanced clean and safe program for Downtown Anchorage called “Safety First.” Anyone in need of assistance in Downtown Anchorage can text or call (907) 297-4471 for safety assistance or to report disorderly/suspicious behavior, panhandling or other nuisance behavior, public drinking/ inebriates, suspicion of drug dealing or drug use. Calls or texts can also be made about graffiti, removing trash, sidewalk cleaning, or other clean-up calls in Downtown Anchorage. The call line is manned by EasyPark and dispatched to Anchorage Downtown

Your Project, Our Responsibility. 24/7 Service

Pacific Pile & Marine has a robust fleet of marine equipment including our recent addition of a 600-Ton 4600 Ringer.

www.pacificpile.com I (907) 276-3878 276-3873 www.akbizmag.com

From critical lifts to platform support, PPM is sufficiently resourced to deliver a wide range of construction services. 620B East Whitney Road I Anchorage, AK 99501 September 2016 | Alaska Business Monthly

119

INSIDE ALASKA BUSINESS Partnership, ltd. Security and Maintenance Ambassadors during the hours of 5 a.m. to 9 p.m., seven days a week. anchoragedowntown.org easyparkalaska.com MATSON LOGISTICS atson, Inc. announced that its subsidiary Matson Logistics, Inc. and Span Alaska have entered into a definitive agreement pursuant to which Matson Logistics will acquire 100 percent of the equity of Span Alaska Transportation LLC for a cash purchase price of $197.6 million. The transaction is expected to be treated as an asset purchase agreement for federal tax purposes which will allow for a step-up in tax basis of the assets producing an anticipated approximate $35 million net present value benefit to Matson. matson.com

INNOVATING ALASKA ACT B126, the Innovating Alaska Act, implements a new concept to grow Alaska’s economy through equity crowdinvesting. The bill was signed into law by the Governor in July. SB126 refines onerous regulations to make it easier for Alaska businesses to get capital to grow and allows average Alaskans to invest in businesses being started in their communities. Investments made through crowdinvesting are limited to $10,000 for investors and $1 million for businesses raising capital. More than twenty-four states have enacted similar intra-state crowdinvesting laws. akleg.gov

USFS & AEA nspired by a number of Alaska success stories in places like Thorne Bay and Tok, the USDA Forest Service has funded a contract that has been issued by Southeast Conference through its partner, the Alaska Energy Authority, to the Cold Climate Housing Research Center (CCHRC) to develop a

Compiled by ABM Staff handbook for biomass-heated greenhouses in Alaska. This effort supports the Department of Agriculture’s objectives of supporting rural community economic development, lowering the cost of energy in rural Alaska, local renewable energy utilization, and food security and childhood nutrition. Living in rural Alaska is filled with challenges with the cost of energy and access to inexpensive, fresh food affecting every aspect of life. A steering committee of stakeholders will guide this project and leverage the knowledge base developed from the many successful projects already deployed by leading Alaskan educators and community leaders. This project will develop a practical handbook to help interested communities plan, build, and manage a biomass-heated greenhouse that will provide hands-on opportunities to use science and technical education to inspire the next generation of entrepreneurs while providing nutritious, fresh vegetables year-round. The Biomass-Heated Greenhouse Handbook will be available in the spring of 2017 from the Alaska Energy Authority. akenergyauthority.org ALASKA PARACORD DESIGNS rayson Davey became the youngest winner of the Made in Alaska’s Manufacturer of the Year Award. The award, presented annually by the Alaska Department of Commerce, Community and Economic Development, highlights the importance of the statewide manufacturing sector. Grayson started Alaska Paracord Designs in 2013 at the age of eleven when family friends were stranded for days after their boat overturned on a local river and had nothing with them to start a fire. Grayson took a paracord bracelet design that he already knew and integrated fire making and survival tools into it—Alaska Paracord Designs was born. Alaska Paracord Designs uses local contractors to hand-make all of their prod-

ucts in Alaska. The company employs more than twenty young Alaskans in Anchorage during its production peak. Alaska Paracord Designs products can be purchased at thirty retailers throughout Alaska and online. alaskaparacorddesigns.com ALASKA NATIVE MEDIA GROUP or the first time, the University of Alaska Anchorage is offering an orientation series on Alaska Natives. First in the series is “Who are the Alaska Natives?” Speakers Willie Hensley, Emil Notti, and Elizabeth Medicine Crow will enlighten attendees about Colonial History: Russian and American and ANCSA Political History: Issues and Personalities. Save the date: Friday, September 16. “What is ANCSA?” will be presented Friday, November 11, and “Modernization of Alaska Native Villages” will be the third in the series and is Friday, February 10, 2017. Each presentation of the Alaska Native Orientation Series will be held on the UAA Campus at Rasmuson Hall, Room 101, from 6:30 p.m. to 9 p.m. Sponsored by the Alaska Native Media Group and UAA’s Interim Vice Chancellor of Alaska Natives and Diversity, College of Business and Public Policy, and Native Student Services, the series is open to all faculty, students, and the general public. alaskanativemedia.org

ACCENT ALASKA After thirty-six years representing 120 Alaskan photographers, Accent Alaska stock photo agency has been sold to Chad Case, a former employee of the company. Contact them to license Alaskan photos for all your projects. Website (AccentAlaska.com) and email address (info@accentalaska.com) remain the same. Madeline Scott is the point of contact. Former owner, Ken Graham, will continue to take on architectural photography assignments. Graham can be reached via his website. kengrahamphotography.com R

• General Contracting • Marine Infrastructure • Design Build

Dutch Harbor - Unalaska, Alaska

www.pacificpile.com I (907) 276-3873 120

620B East Whitney Road I Anchorage, AK 99501

Alaska Business Monthly | September 2016 www.akbizmag.com

SHOP

PLAY 

By Tasha Anderson

PLAY: NEW SEASONS FOR ALASKA’S PERFORMING ARTS

he light is fading and temperatures are falling. Alaska’s glorious summer may be winding down, but across the state the performing arts are just getting started. Here are some of the up and coming arts seasons so Alaskans can come inside to play.  The Anchorage Symphony Orchestra’s Opening Night is Saturday, September 24, and will feature Van Cliburn Piano Competition Finalist, Fei Fei Dong and “new perspectives as three composers set out on uncharted paths to redefine the music of their time.” The season will also include Disney in Concert: A Silly Symphony Celebration in October; Silent Film Double Feature: Charile Chaplin’s The Kid and The Idle Class in January; and Faithfully: A Symphonic Tribute to the Music of Journey in March, among other performances. anchoragesymphony.org  The Valley Performing Arts kicks off their 2016-2017 season in September with Harvey, a comedy about an imaginary sixfoot-tall rabbit. The season is filled out with Who’s Afraid of Virginia Woolf? starting in

www.akbizmag.com

October; elf: The Musical in November; Boeing Boeing starting in January; Lend me a Tenor starting in February; And Then There Were None, the Agatha Christie classic starting in March; and California Suite in May. valleyperformingarts.org  The Anchorage Opera’s first performance of the season is Rigoletto by Verdi, opening in October. The Anchorage Opera’s season will also feature Glory Denied by Tom Cipullo in February and a 55th Anniversary Extravaganza featuring the Opera’s greatest hits in April. anchorageopera.org  Perseverance Theatre brings the theater to both Anchorage and Juneau. This season they will present Peter and the Starcatcher, Not Medea, Hold These

STAY

Truths, They Don’t Talk Back, and To Kill a Mockingbird—with the addition of A Christmas Carol in Anchorage and This Wonderful Life in Juneau for the Christmas season. ptalaska.org  The Anchorage Concert Association has lined up a myriad of performances for 2016-2017, kicking off in September with swing band Big Bad Voodoo Daddy and wrapping up in May with humor writer David Sedaris. The series features a performance for everyone, ranging from Broadway musicals to comedians to dance performances to Puddles Pity Party: a seven-foot tall clown who sings with a baritone. anchorageconcerts.org  First City Players in Ketchikan Alaska is opening its season in November with The Little Mermaid, adapted from the Broadway production. Their season wraps up in June with another musical, Grease. In between, arts lovers can enjoy b.f.g. & b.f.f, an adaption of Roald Dahl’s book; Shrek; Boeing Boeing; and Have a hiss-y Feast! a homegrown comical melodrama served with Alaskan seafood and welcomes the audience to weigh in. firstcityplayers.org R

September 2016 | Alaska Business Monthly

121

PERFORMING ARTS

EAT

EVENTS CALENDAR SEPTEMBER 2016

EAT

PLAY 

SHOP

SEPT

Anchorage SEPT

Battle Zone Ursa

Zone Ursa is the first of its kind, nonprofit, by players for 17-18 Battle players tabletop miniature convention in Alaska, focusing on multiple aspects of miniature war gaming, tournament play, and painting. Brought to you by SenshiCon. Dena’ina Center. battlezoneursa.com

Anchorage SEPT

49th Annual Champagne Pops

10 An elegant black-tie evening, this year’s program of dance-worthy hits pays tribute to legends: Queen, Michael Jackson, Journey, Whitney Houston, the Bee Gees, Aerosmith, and more sung by celebrity vocalists LaKisha Jones (American Idol, Broadway’s The Color Purple) and Rob Evan (Trans-Siberian Orchestra, Broadway’s Jekyll & Hyde). Atwood Concert Hall. anchoragesymphony.org SEPT

Alaska Fall Home Show

free admission 16-18 There’s to this annual show

featuring products and services to continue home projects through the fall and winter season, including seminars and how-to workshops, industry experts, and the special landscape display. Dena’ina Center. anchorageconventioncenters.com SEPT

Comedian Jo Koy was raised in Tacoma, Washington, and has evolved from his modest beginnings in a Las Vegas coffee house to being a weekly guest on the Adam Carolla Show and recently started a podcast, Koy Pond with Jo Koy, in addition to selling out at clubs across the nation. His material is PG-13 and may be inappropriate for children under thirteen years of age. Egan Convention Center. Tickets available at Ticketmaster.com

SEPT-OCT

Cabin Quilters for the Great Alaska Quilt Show. Large bed-sized, traditional, modern, applique, machine, and hand quilted quilts, as well as wearable quilt garments made by members, will be displayed. ConocoPhillips Atrium. anchoragelogcabinquilters.blogspot.com

Anchorage

Senshi Con

Senshi Con is an annual convention that caters to enthusiasts of Asian culture, animation, graphic novels, and gaming. It is Alaska’s largest event to share fandoms, make new friends, and enjoy a nearly endless array of costumes, live events, panels, and contests and shop favorite artists and vendors. Egan Convention Center. senshicon.org

30-2

Great Alaska Quilt

17-18 Show Join the Anchorage Log

Jo Koy

Alyeska Climbathon

The Alyeska Climbathon is an endurance event where participants will walk, hike, and run up the steep North Face Trail of Mount Alyeska and ride the Tram down as many times as possible from 9 a.m. to 7 p.m. This event is a fundraiser for women’s cancer. Alyeska Tramway. alyeskaresort.com

SEPT

Oktoberfest at Alyeska Resort

16-17 & 23-24 Celebrate German traditions, the changing of the seasons, and, of course, beer. This event spans over two weekends and will feature authentic Bavarian fare and festivities including full polka band and other live performances. Open to all ages and free admission. Alyeska Resort. alyeskaresort.com Juneau SEPT

STAY

Compiled by Tasha Anderson

Discover Eaglecrest Day

Get acquainted with the mountain during this fun day of activities with something for everyone in the family. Events include free lift rides up the Porcupine Chair, Discovery Southeast disc golf, Fatmo’s Alpine barbeque, the Alaska Zipline beer and wine garden, and the Juneau Ski Club bake sale and registration. Eaglecrest Ski Area, 10 a.m. to 3:30 p.m. juneau.org

Nome SEPT

Nome Rotary Labor Day Duck Race

Hundreds of numbered rubber ducks are poured into the Snake River. The ducks are dumped into the river about two hundred yards upstream from the bridge that crosses from the airport road over toward the port. First place is $1,000; second place earns $750; third place is $500. Snake River by Bering Air, 2 p.m. visitnomealaska.com

Seward SEPT

23-25

Seward Music & Arts Festival

There will be live music and dance performances, with local Alaskan artisan craft and food vendors featured. The Seward Arts Council promotes a family-oriented festival with children’s activities and artist’s projects throughout the weekend in addition to the food court, beer garden, and community art show and more than twenty live musical acts and dance performances. Dale R. Lindsey Alaska Railroad Seward Intermodal Terminal. On Facebook. R

Fairbanks SEPT

8-10

Far North Fiddle Fest Benefit Concert

This is a fund raising event for The Greater Fairbanks Community Hospital Foundation. All proceeds from the concert will be donated to the FMH Hospice program. Artists scheduled to perform include Jeremy Kittel Band, Ten Strings & A Goat Skin, Eden MacAdam-Somer, and Leela and Ellie Grace. Davis Concert Hall, 7 p.m. fairbankshospitalfoundation.com SEPT

ALASKA INBOUND

MARKETING SUMMIT

Opera Ball

The ball includes a live orchestra, dinner, dancing, a champagne toast, and live vocal performances from Die Fledermaus. Westmark Fairbanks. operafairbanks.org

SEPT

Alaska Women’s Show

23-25 Vendors celebrate

everything that makes Alaska women unique. The show features financial seminars, fashion shows, jewelry, healthcare information, and more. Sullivan Arena. auroraproductions.net/women 122

Girdwood SEPT

Mountain Bike Festival

Three days of biking-themed competitions including whips and tricks, wheelie comp, downhill race, and the popular Pond Crossing, where competitors attempt to cross a floating bridge without falling into the cold water. alyeskaresort.com

Keynote Speaker

Jay Baer

2-5

SEPTEMBER 9TH, 2016 | ANCHORAGE, AK

www.alaskainbound.com

Alaska Business Monthly | September 2016 www.akbizmag.com

Alaskans serving Alaskans. Oxford is the only gold refiner with two locations in Alaska for over 35 years. We offer maximum returns on gold and silver. Oxford provides the service and value

Modern Boutique.

CLASSIC CHARM.

Alaskans have counted on for generations.

Exquisitely restored in the heart of downtown, the Historic Anchorage Hotel offers superior service and luxury accommodations in a boutique setting – at a price you can afford.

• ANCHORAGE

Its remodeled banquet spaces can accommodate 150.

• NOME

• FAIRBANKS

BUY : SELL : TRADE ALASKA’S ONLY LOCAL REFINER

• NEW YORK 330 E Street, Anchorage, Alaska 99501 | 907-272-4553 • 800-544-0988

www.HistoricAnchorageHotel.com

HIS012 ABM Print Ad_V7.indd 1

www.akbizmag.com

1.800.693.6740 oxfordmetals.com

8/30/12 1:38 PM

September 2016 | Alaska Business Monthly

123

Business Events SEPTEMBER Association SEPT Alaska of REALTORS Convention

14-17

Centennial Hall, Juneau: The annual convention includes keynote and guest speakers and opportunities for ECE credits. alaskarealtors.com

Recreation & Park SEPT Alaska Association Conference

14-17

Parks & Recreation Community Center, Petersburg: The conference includes keynote speaker, a mini expo, education sessions, and the Annual Meeting and Awards Banquet: Sons of Norway. alaskarpa.org

SEPT

15-16

Alaska Recreation & Park Association Conference

Petersburg: This year’s theme is “Rising Together,” and the keynote speaker is Greg Morton, a corporate strategy and growth development specialist. alaskarpa.org

Fire Conference SEPT Alaska Fairbanks: Includes training, work-

19-24

shops, lectures, and a firefighter competition. The 2015 theme is “Leading the Way.” alaskafireconference.com

Oil & Gas Congress SEPT Alaska The Congress includes critical market

20-21

assessments, the latest information from key industry players, and information on key issues impacting Alaska’s energy future. alaskaoilandgascongress.com

Superintendents SEPT Alaska Association Fall Conference

22-24

Wasilla: The pre-conference takes place September 21. alaskaacsa.org

Alaska Annual SEPT Museums Conference

22-24

Juneau: This year’s conference theme is “Mission Possible: Creating Opportunity.” museumsalaska.org

Writers Guild/SCBIW SEPT Alaska Annual Conference

23-27

BP Energy Center: Two full days of breakouts, keynotes, and panels, plus optional intensives, manuscript reviews, a juried illustrator portfolio display, and of course a Saturday children’s literature rack in association with the Society of Children’s Book Writers and Illustrators. alaskawritersguild.com

Compiled by Tasha Anderson management industry brought to Alaska by the Snowfighters Institute. alaskasnowsymposium.com

Business Monthly’s SEPT Alaska Top 49ers Luncheon

Dena’ina Center, Anchorage: Come honor the top ranked Alaska companies by revenue at our annual luncheon. 907-276-4373 | akbizmag.com

OCTOBER

OCT

3-6

Anchorage: The Alaska Travel Industry Association is the leading nonprofit trade organization for the state’s tourism industry. alaskatia.org

OCT

4-5

26-29

the annual conference of the Alaska Association of Harbormasters & Port Administrators. alaskaharbors.org

Snow Symposium SEPT Alaska Dena’ina Center, Anchorage: A one-

124

day trade show for the snow and ice

Arctic Ambitions V International Conference and Trade Show

Sheraton Anchorage Hotel: This annual event uniquely focuses on business and investment opportunities flowing from developments in the Arctic. wtcak.org

OCT

All-Alaska Medical Conference

Wedgewood Resort, Fairbanks: A continuing medical education conference put on by the Alaska Academy of Physicians Assistants, providing up to twenty-five CMEs. akapa.org

6-8

OCT

11-12

Alaska Coalition on Housing and Homelessness Conference

Anchorage: Events include keynote speakers and training sessions. alaskahousing-homeless.org/conference

OCT

Alaska Chamber Fall Forum

Challenger Learning Center of Alaska, Kenai: Open to the public, the Alaska Chamber’s Annual Conference is the state’s premier business conference. Traditionally held in the fall, the Conference draws 200-225 attendees and features keynote speakers, panel discussions, and breakout sessions on issues of statewide concern to Alaska business. alaskachamber.com

11-13

OCT

20-22

Alaska Federation of Natives Annual Convention

Fairbanks: Annual gathering of Alaska Native peoples to discuss current news and events on a state, national, and international level. This year’s theme is “50 Year: Reflect, Refresh, Renew.” nativefederation.org

NOVEMBER

AAHPA Annual Conference

SEPT Unalaska/Dutch Harbor: This is

ATIA Annual Convention & Trade Show

NOV

7-12

AMA Fall Convention and Trade Show

Dena’ina Center, Anchorage: The Alaska Miners Association annual convention and trade show continues to grow. alaskaminers.org

NOV

9-12

Associated General Contractors of Alaska Annual Conference

AGC of Alaska is a non-profit construction trade association dedicated to improving the professional standards of the construction industry. agcak.org

NOV

AASB Annual Conference

NOV

AAMC Conference

Anchorage Hilton: The mission of the Association of Alaska School Boards is to advocate for children and youth by assisting school boards in providing quality public education, focused on student achievement, through effective local governance. aasb.org

10-16

Hotel Captain Cook, Anchorage: The Alaska Association of Municipal Clerks is an organization that focuses on providing educational training and mentoring and professional growth opportunities. alaskaclerks.org

13-15 NOV

14-18

Annual Local Government Conference

Anchorage: The Alaska Municipal League is a voluntary, nonprofit, nonpartisan, statewide organization of 162 cities, boroughs, and unified municipalities, representing over 97 percent of Alaska’s residents. akml.org

NOV

16-17

RDC Annual Conference: Alaska Resources

The conference provides timely updates on projects and prospects, addresses key issues and challenges, and considers the implications of state and federal policies on Alaska oil and gas, mining, and other resource development sectors. akrdc.org

NOV-DEC BIA26 Dena’ina Center: The conference pro-

29-2

vides attendees with the opportunity to be informed and prepare for upcoming challenges in Alaska, as well as the opportunity for tribal leaders, native corporations, and rural representatives to connect with federal agencies. biaprovidersconference.com

DECEMBER

DEC

4-7

ALASBO Annual Conference

Anchorage: Annual conference of the Alaska Association of School Business Officials. alasbo.org

JANUARY 2017

JAN

25-28

Anchorage AEYC Early Childhood Conference

Hilton Anchorage Hotel: “Best Practices in the Face of Change.” 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 to help face any challenge. anchorageaeyc.org R

Alaska Business Monthly | September 2016 www.akbizmag.com

ALASKA TRENDS

By Khristian Viray

The Resilience of Alaska’s Construction Industry

he construction industry is inherently more volatile than other sectors, as building activity of all sorts booms and busts with the economic winds. With state budget concerns and a slowdown in the oil and gas sector, some retrenchment in construction should be expected; indeed, June 2016 saw construction employment down by one thousand jobs compared to June 2015, according to the Bureau of Labor Statistics. Overall, the Alaska Department of Labor and Workforce Development expects the construction industry to lose nine hundred jobs in 2016. In 2015, construction employment peaked early in July with twenty-one thousand employees. In the years 2014 and 2013, peak employment did not occur until August and there were approximately five hundred more employees compared to 2015’s peak. With the construction season still underway, the peak figures for 2016 are not yet known. However, the situation could be worse, and the state’s construction firms have a stabilizing force: transportation projects and funding. According to Alaska Department of Transportation and Public Facilities (DOT&PF) figures, 2015 was a record-setting year for Southcentral Alaska alone with more than $300 million spent on transportation projects. This year, more than $1 billion is being spent on transportation-related construction statewide; specifically $705 million is committed to highways and road projects. DOT&PF road construction, which is funded predominantly through federal funds and a state match (typically 90 percent federal and 10 percent state), offers a steady flow of investment and employment—insulated somewhat from concerns about the state budget. In early August there were sixty-five ongoing road construction projects listed in AlaskaNavigator.org, a state-run

However, the situation could be worse, and the state’s construction firms have a stabilizing force: transportation projects and funding. website that tracks DOT&PF projects. The list varies from the big budget Glenn Highway and Muldoon Interchange Improvement costing about $55 million, to small projects like tree removal to enhance visibility and prevent icing caused by shading on select Central Region roadways, estimated to cost between $1 million to $2.5 million. Longer completion timeframes add a further measure of revenue and employment stability, as the Glenn Muldoon project is scheduled to be completed late in 2018, while the latter has an earlier completion date of September this year. A degree of stability in the road construction arena is expected to continue with the help of the five-year transportation bill signed last year by President Barack Obama. The bill guarantees Alaska approximately $2.7 billion until fiscal year 2020. With ISER projecting a 25 percent decline in oil and gas-related construction, and a 19 percent reduction in healthcare construction for 2016, the continued expenditure is welcome. R

Alaska Trends, an outline of significant statewide statistics, is provided by the University of Alaska Center for Economic Development.

ALASKA TRENDS HAS BEEN BROUGHT TO YOU THIS MONTH COURTESY OF AMERICAN MARINE/PENCO AMERICAN MARINE • Marine Construction/Dredging • Subsea Cable Installation & Maintenance • Commercial Diving • Platform & Pipeline Construction, Installation, Repair & Decommissioning • Underwater Certified Welding • Marine Salvage • NDT Services • ROV Services • Vessel Support Services PENCO • Environmental Response/Containment • Site Support Technicians/Maintenance • Waste Management/Environmental Monitoring • Tank Cleaning/Inspection • Petroleum Facility Maintenance & Repair • Logistics Support • 24-Hour Response

ANCHORAGE OFFICE 6000 A Street, Anchorage, Alaska 99518

(907) 562-5420

www.akbizmag.com

www.amarinecorp.com www.penco.org

Alaska I California I Hawaii DEADHORSE OFFICE Pouch 340079, Prudhoe Bay, AK 99734 (907) 659-9010 September 2016 | Alaska Business Monthly

125

ALASKA TRENDS

Indicator

By Nolan Klouda

Units

GENERAL Per Capita Personal Income—Alaska US $ Per Capita Personal Income—United States US $ Consumer Prices—Anchorage 1982-1984 = 100 Consumer Prices—United States 1982-1984 = 100 Bankruptcies Alaska Total Number Filed Anchorage Total Number Filed Fairbanks Total Number Filed Labor Force in Alaska Thousands Unemployment Rate Alaska Percent United States Percent Employment Alaska Thousands Anchorage/Mat-Su Region Thousands Anchorage, Municipality Thousands Interior Region Thousands Fairbanks North Star Borough Thousands Southeast Thousands Juneau, City and Borough Thousands Northern Region Thousands Gulf Coast Thousands Southwest Region Thousands Sectorial Distribution—Alaska Total Nonfarm Thousands Goods-Producing Thousands Mining and Logging Thousands Mining Thousands Oil & Gas Thousands Construction Thousands Manufacturing Thousands Seafood Processing Thousands Service-Providing Thousands Trade, Transportation, Utilities Thousands Wholesale Trade Thousands Retail Trade Thousands Food & Beverage Stores Thousands General Merchandise Stores Thousands Trans/Warehouse/Utilities Thousands Air Transportation Thousands Information Thousands Telecommunications Thousands Financial Activities Thousands Professional & Business Services Thousands Educational & Health Services Thousands Healthcare Thousands Leisure & Hospitality Thousands Accommodation Thousands Food Services & Drinking Places Thousands Other Services Thousands Government Thousands Federal Government Thousands State Government Thousands State Education Thousands Local Government Thousands Local Education Thousands Tribal Government Thousands PETROLEUM/MINING Crude Oil Production—Alaska 126

Millions of Barrels

Period

Latest Report Period

Previous Report Period (revised)

Year Ago Period

Year Over Year Change

1stQ16 1stQ16 1stH16 1stH16

56,269.0 48,707.0 216.9 238.7

55,934.0 48,322.0 216.7 237.7

55,889 46,998 217.1 236.2

0.7% 3.6% -0.1% 1.1%

June June June June

32.0 24.0 5.0 367.5

35.0 26.0 7.0 360.3

36 32 3 371.6

-11.1% -25.0% 66.7% -1.1%

June June

6.8 4.9

6.6 4.7

6.6 5.3

3.0% -7.5%

June June June June June June June June June June

342.6 191.5 150.1 49.7 43.0 36.6 16.5 9.4 37.1 18.2

336.4 190.2 149.1 50.2 43.9 35.7 16.7 9.4 35.8 14.9

347.0 192.1 150.5 50.4 43.8 37.4 16.9 10.2 38.3 18.4

-1.3% -0.3% -0.3% -1.4% -1.8% -2.1% -2.4% -7.8% -3.1% -1.1%

June June June June June June June June June June June June June June June June June June June June June June June June June June June June June June June June June

359.4 52.4 15.6 15.5 12.3 19.2 17.6 13.5 307.0 71.4 6.6 40.4 6.3 11.1 24.4 6.4 6.1 4.1 12.7 29.1 49.4 36.8 43.0 12.1 24.5 11.6 83.7 16.8 23.8 5.9 43.1 23.5 4.1

343.4 44.0 15.4 15.3 12.2 17.3 11.3 7.7 299.4 68.9 6.7 39.1 6.2 10.9 23.1 6.1 6.2 4.2 12.2 28.5 49.4 36.1 37.6 10.2 22.0 11.5 85.1 16.2 24.8 7.2 44.1 25.2 4.1

358.2 55.2 17.8 17.5 14.3 20.2 17.2 13.0 303.0 69.5 6.7 38.9 6.2 10.7 23.9 6.5 6.3 4.2 12.8 31.5 47.3 34.5 41.1 11.5 23.6 12.0 82.5 15.5 25.0 6.1 42.0 22.8 4.0

0.3% -5.1% -12.4% -11.4% -14.0% -5.0% 2.3% 3.8% 1.3% 2.7% -1.5% 3.9% 1.6% 3.7% 2.1% -1.5% -3.2% -2.4% -0.8% -7.6% 4.4% 6.7% 4.6% 5.2% 3.8% -3.3% 1.5% 8.4% -4.8% -3.3% 2.6% 3.1% 2.5%

June

14.1

15.7

13.4

17.2%

Alaska Business Monthly | September 2016 www.akbizmag.com

ALASKA TRENDS

By Nolan Klouda Latest Report Period

Previous Report Period (revised)

Year Ago Period

Year Over Year Change

Indicator

Units

Period

Natural Gas Field Production—Alaska ANS West Coast Average Spot Price Hughes Rig Count Alaska United States Gold Prices Silver Prices Zinc Prices

Billions of Cubic Ft. $ per Barrel

June June

6.7 47.4

7.1 46.6

7.9 64.4

-10.1% -27.6%

Active Rigs Active Rigs $ Per Troy Oz. $ Per Troy Oz. $ Per tonn

June June June June June

9.0 417.0 1,318.8 18.4 2,026.2

6.0 409.0 1,211.3 16.1 1,923.8

10.0 861.0 1181.88 16.1 2,082.1

-10.0% -51.6% 11.6% 14.0% -2.7%

Millions of $ Millions of $ Millions of $ Millions of $

May May May May

116.5 32.2 80.6 3.7

30.1 11.4 16.3 2.3

54.8 18.5 18.7 17.4

112.6% 74.1% 331.0% -78.7%

Dollars Dollars Dollars

1stQ16 1stQ16 1stQ16

290,179.0 184,481.0 572,364.0

277,338.0 188,235.0 697,162.0

281,494.0 180,214.0 442,343.0

3.1% 2.4% 29.4%

Dollars Dollars

1stQ16 1stQ16

228,377.0 160,394.0

230,430.0 163,119.0

241,092.0 167,354.0

-5.3% -4.2%

Units Units Units

1stQ16 1stQ16 1stQ16

89.0 4.0 43.0

134.0 7.0 203.0

110.0 1.0 192.0

-19.1% 300.0% -77.6%

Thousands Thousands

June June

634.1 114.8

357.7 72.1

619.25 118.69

2.4% -3.3%

REAL ESTATE Anchorage Building Permit Valuations Total Residential Commercial Government Average Loan in Housing Market Statewide Single-Family Condominium Multi-Family Refinance Average Loan Statewide Single-Family Condominium New Housing Built Statewide Single-Family Mobile Home Multi-Family VISITOR INDUSTRY Total Air Passenger Traffic—Anchorage Total Air Passenger Traffic—Fairbanks

ALASKA PERMANENT FUND Equity Millions of $ May Assets Millions of $ May Net Income Millions of $ May Net Income—Year to Date Millions of $ May Marketable Debt Securities Millions of $ May Real Estate Investments Millions of $ May Preferred and Common Stock Millions of $ May

53,383.2 53,161.3 54,638.0 54,289.3 53,999.6 55,433.0 173.6 194.7 324.2 191.5 672.2 327.8 -66.8 79.5 -75.5 120.5 121.1 -8.2 -117.7 317.9 (49.7)

BANKING (excludes interstate branches) Total Bank Assets—Alaska Cash & Balances Due Securities Net Loans and Leases Other Real Estate Owned Total Liabilities Total Bank Deposits—Alaska Noninterest-bearing deposits Interest- bearing deposits

Millions of $ Millions of $ Millions of $ Millions of $ Millions of $ Millions of $ Millions of $ Millions of $ Millions of $

1stQ16 1stQ16 1stQ16 1stQ16 1stQ16 1stQ16 1stQ16 1stQ16 1stQ16

6,281.1 323.6 146.6 3,014.6 21.0 5,439.0 4,701.6 2,014.1 2,687.4

6,240.2 230.2 145.1 3,024.5 22.5 5,420.3 4,275.3 1,895.6 2,379.7

5,913.90 222.57 151.28 2,866.23 19.95 5,109.57 4,334.37 1,779.18 2,555.19

6.2% 45.4% -3.1% 5.2% 5.3% 6.4% 8.5% 13.2% 5.2%

FOREIGN TRADE Value of the Dollar In Japanese Yen In Canadian Dollars In British Pounds In European Monetary Unit In Chinese Yuan

Yen Canadian $ Pounds Euro Yuan

June June June June June

102.4 1.3 0.7 0.9 6.6

108.7 1.3 0.7 0.9 6.5

123.82 1.24 0.64 0.89 6.11

-17.3% 4.8% 15.6% 1.1% 8.7%

-2.3% -2.1% -46.5% -41.6% 11.5% 1569.5% -136.8%

Notes: Banking data has been updated to include Alaska State Banks and Alaska’s sole federally chartered, Alaska-based bank, First National Bank Alaska. Information oh housing is retrieved from AHFC website. www.akbizmag.com

September 2016 | Alaska Business Monthly

127

ADVERTISERS INDEX Advanced Physical Therapy of Alaska....................................................67 AE Solutions Alaska LLC.................................................................................82 Ahtna Inc...............................................................................................................25 Alaska Directional LLC....................................................................................80 Alaska Dreams Inc.........................................................................................109 Alaska Procurement Technical Assistance Center...........................58 Alaska Railroad...................................................................................................92 Alaska Regional Council Carpenters.................................................... 112 Alaska USA Federal Credit Union...............................................................21 Alaska USA Insurance Brokers..................................................................111 American Fast Freight.....................................................................................93 American Marine / Penco..........................................................................125 Anchorage Messenger Service...................................................................68 Arctic Office Products....................................................................................50 Arctic Technology Conference.................................................................. 81 AT&T..........................................................................................................................15 Avis Rent-A-Car................................................................................................121 BDO..........................................................................................................................38 Beacon Media & Marketing.......................................................................122 BP ........................................................................................... 75 Bristol Bay Native Corp...............................................................................129 C & R Pipe and Steel Inc.............................................................................. 112 Calista Corp...................................................................................................... 110 Carlile Transportation Systems.........................................................47, 97 Catalyst Marine Engineering....................................................................103 CH2M.......................................................................................................................85 Chugach Alaska Corp.....................................................................................33 Construction Machinery Industrial............................................................. 2

Crowley Alaska Inc...........................................................................................73 Cruz Construction Inc....................................................................................99 Dale Carnegie......................................................................................................61 Davis Constructors & Engineers Inc.....................................................105 Doyon Limited........................................................................................................3 EDC Inc..................................................................................................................95 Everts Air Cargo - Tatonduk Outfitters..................................................39 Fairweather LLC.................................................................................................77 First National Bank Alaska................................................................................5 Foss Maritime......................................................................................................76 GCI...............................................................................................................82, 130 Historic Anchorage Hotel..........................................................................123 Hot Wire LLC......................................................................................................101 Judy Patrick Photography.........................................................................128 JW Industries...................................................................................................107 Landye Bennett Blumstein LLP..................................................................92 Lynden Inc.............................................................................................................11 Matson Inc............................................................................................................69 Mechanical Contractors of Fairbanks..................................................106 Microcom..............................................................................................................52 N C Machinery.....................................................................................................71 Nalco Energy Services....................................................................................95 NCB..........................................................................................................................22 New Horizons Telecom Inc..........................................................................23 Northern Air Cargo........................................................................... 116, 117 Northrim Bank....................................................................................................49 Northwest Strategies......................................................................................60 Olympic Tug & Barge......................................................................................90

Oxford Assaying & Refining Inc..............................................................123 Pacific Coast Maritime....................................................................................90 Pacific Pile & Marine............................................................118, 119, 120 Paragon Interior Construction................................................................108 Parker Smith & Feek.........................................................................................29 PenAir......................................................................................................................91 Personnel Plus.................................................................................................123 Petro Marine 49...............................................................................................113 PRL Logistics.......................................................................................................27 Quality Asphalt Paving................................................................................108 Quintillion Networks.......................................................................................87 Ravn Alaska..........................................................................................................55 Ritchie Brothers Auctioneers...................................................................104 RSA Engineering Inc..................................................................................... 110 Seekins Ford Lincoln Mercury Fleet........................................................32 Stellar Designs Inc.........................................................................................123 T. Rowe Price.......................................................................................................53 Tanana Chiefs Conference Inc....................................................................17 The Plans Room...............................................................................................101 Think Office.........................................................................................................22 Truckwell of Alaska..........................................................................................83 Tulalip Casino Resort.......................................................................................41 Turnagain Marine Construction.................................................................84 UAA College of Business and Public Policy.........................................65 UIC Marine Services.........................................................................................40 United Way of Alaska......................................................................................63 Visit Anchorage..................................................................................................35 Voice of the Arctic Inupiat............................................................................37 Washington Crane & Hoist............................................................................51

AVAILABLE NOW! A COFFEE TABLE PHOTO BOOK OF ALASKAâ&#x20AC;&#x2122;S NORTH SLOPE OIL PATCH

PICK UP YOUR COPY TODAY! 511 W. 41st Ave, Suite 101, Anchorage, AK 99503 (907) 258-4704 judypatrickphotography.com Also available in bulk quantities!

128

Alaska Business Monthly | September 2016 www.akbizmag.com

“I work in the maintenance bay of an oilfield service company on the Kenai owned by Bristol Bay Native Corporation. Every summer, I go home to Bristol Bay to fish the salmon run. It took me years to save enough to buy my own boat, but now I have two ways to make a living in Alaska. In these difficult times, that’s the kind of thing many Alaskans are doing. It’s also why Bristol Bay Native Corporation has diversified its business, to help diversify Alaska’s economy and keep over a thousand Alaskans employed, Native and non-Native alike.” —Casey Coupchiak, BBNC Shareholder

Diversifying Alaska’s Economy