Issuu on Google+


leather seats, no

aluminum wheels, no

rear defroster, no

keyless entry, yes

There are plenty of options in Alaska – America’s Last Frontier. Naturally, we’re proud to be a part of it.

XTO Energy Inc. 810 Houston Street Fort Worth, Texas 76102 817.870.2800 www.xtoenergy.com


APRIL 2011 TA B L E O F C O N T E N T S

D E PA R T M E N T S From the Editor . . . . . . . . . . . . . . . 7 Inside Alaska Business . . . . . . . . 8 Right Moves . . . . . . . . . . . . . . . . 24 Market Squares . . . . . . . . . . . . 146 Events Calendar . . . . . . . . . . . 149 Alaska Trends . . . . . . . . . . . . . 151 Ad Index . . . . . . . . . . . . . . . . . . 154

ABOUT THE COVER The Corporate 100 is a list of the Top 100 businesses in Alaska, based on employees, revenues (if provided), good corporate citizenship, years in Alaska, products and services and more. These 100 were selected by a board of six and are Champions of Industry. Pictured on the cover are Trond-Erik Johansen/ConocoPhillips Alaska, Annie Holt/Alaska Regional Hospital and Rex Rock Sr./Arctic Slope Regional Corp. For stories on these leaders and their companies, turn to our special section, which begins on page 72. Photo ©2011 by Chris Arend.

R E G U L A R F E AT U R E S

View From

the

Top

Manufacturing

Paul and Janice Villnerve, Owners���������������������������������������������11 Moose Bites Personal Chefs By Peg Stomierowski

Adding Value to Resources In-State������������������������������������������ 18 More jobs, bigger tax base, lower consumer costs By Heidi Bohi

Marketing Works

Timber

Marketing and Advertising���������������������������������������������������������� 16 Distinguishing the difference By Ron “Cat” Mason

HR Matters Retaliation Burns ������������������������������������������������������������������������ 22 Know the ground rules to prevail By Lynne Curry

Associations World Trade Center Alaska �������������������������������������������������������� 30 Helping Alaska companies expand globally By Tracy Barbour

Regional Review Interior Alaska������������������������������������������������������������������������������ 56 Resting at the heart of the state By Tracy Barbour

Investing

in

Alaska OP-ED

Extending the Rail Line at Port MacKenzie��������������������������� 119 The next great investment for Alaskans By Lee Henry

Towns

in

Transition

Kodiak: The Emerald Isle��������������������������������������������������������� 132 Martitime hub increasing tourism to diversify economy By Heidi Bohi

Alaska This Month Young Alaskans Celebrate KidsDay��������������������������������������� 148 Imaginarium, museums, other attractions free for a day By Nancy Pounds ARTICLES

Fisheries Sitka’s ‘Alaskans Own’ Seafood ������������������������������������������������ 12 Subscribers get their fish from local waters By Will Swagel

4

ARTICLES

Poppert Milling Inc. .�������������������������������������������������������������������� 26 Wasilla’s local lumber yard By Jeff Mullins

Telecommunications Changes at Alaska Communications���������������������������������������� 28 Anand Vadapalli takes the helm By Heidi Bohi

Fisheries Southeast Alaska Mariculture. .������������������������������������������������� 32 Geoduck divers create new industry By Nicole A. Bonham Colby

Small Business Feature Paris Bakery and Café ���������������������������������������������������������������� 36 Bon Apétit! By Stephanie Jaeger

Education Alaska Colleges and Universities���������������������������������������������� 38 Putting higher education within reach for Alaskans By Louise Freeman

Real Estate Anchorage Commercial Property Looking Good�������������������� 42 Some withdrawal, but overall Alaska holds strong By Jack E. Phelps

Native Business Trucking Through Canada���������������������������������������������������������� 48 Cross-border advantages for Alaska Natives By Darren Prokop

Transportation Moving Freight in Alaska������������������������������������������������������������ 52 Commodities important to transportation industry By Jack E. Phelps (continued on page 6)

www.akbizmag.com • Alaska Business Monthly • April 2011


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APRIL 2011 TA B L E O F C O N T E N T S ARTICLES

ARTICLES

Health & Medicine

Real Estate

Reducing Cardiovascular Risk . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60 Getting Alaskans heart healthy By Neal Webster Turnage

Southeast Real Estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 142 Panhandle prefers winter sales

Health & Medicine OP-ED

Techy Gadgets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 144 Practicality for Alaska’s business leaders By Kent L. Colby

Find Real Health Care Reform . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65 Demand adaptation and innovation By Greg Loudon

Technology

Special Section CORPORATE 100

Data Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68 More than protecting bits and bytes By Tracy Barbour

Transportation Pacific Alaska Freightways Celebrates 50 Years in Alaska . . . 116 Washington-state company builds lasting relationships with Alaskans By Molly Dischner

Oil & Gas Elusive Pipeline Dreams . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 120 Waiting for suitable demand By Mike Bradner

Oil & Gas Cook Inlet Economic Impact . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124 Kenai Peninsula ready for industry revival By Mike Bradner

Oil & Gas Impact of Current Oil-Tax System Forces Alaskans to Make Tough Decisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 128 By Sandra Yi

Alternative Energy Hydroelectric Advances in Alaska . . . . . . . . . . . . . . . . . . . . . . . 134 Harnessing cleaner, cheaper power By Vanessa Orr

Alternative Energy Geothermal Heats Up . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 138 Developing Alaska’s Steamy Resources By Tracy Kalytiak

CORRECTIONS A February article on biometric technology described Alaska Senate Bill 190 as pending legislation. However, SB 190 died last year and is no longer under consideration. A “Time-Sensitive Freight” article in the March issue said Alaska Air Cargo uses reconfigurable 737-200 Combi aircraft. However, the company retired these planes from its fleet about five years ago and now flies 737-400 Combis, which are not reconfigurable.

6

Technology

Corporate 100 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72 2011 Corporate 100 by Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74 Alaska Business Monthly’s 2011 Corporate 100 . . . . . . . . . . . . . . 76 Alaska Regional Hospital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104 Striving for better, not bigger By Tracy Kalytiak Arctic Slope Regional Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 108 Delivering benefits to shareholders By Tracy Kalytiak ConocoPhillips Alaska . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 112 Committed to Alaska By Vanessa Orr

Alternative Energy Update Jesse Moe of Renewable Energy Systems in Anchorage wrote regarding a December alternative energy article: Partusch had their wind turbine connected on July 20, our wind turbine had already been operating a year before that. Our turbine was officially connected June 23. Another concern is the affect of mentioning wind as a viable project for Anchorage residents or businesses. Anchorage is simply not a wind site, a good wind site has average winds of 15-20 mph, most of our data puts Anchorage at about 3-5 mph. My concern is we educate people to make wise decisions, especially early on, to prevent creating a bad name for the entire industry. ... However, unlikely as it may seem, Anchorage is a far better option for solar energy. On our building we have both a solar array and a wind turbine connected to the utility grid. We get more than five times the amount of production from our solar than our wind. ... Another one of our projects, a building on Fifth Avenue and E Street was adding 96 solar panels in March. We also have many similar projects going up soon that are currently in the engineering process. ... Basically, solar works great at the residential, commercial, remote site or village level. However, we will agree that it is not a viable option for utility power. In my opinion, the closer the renewable source is to the person consuming the energy, the more energy aware they will be. That should be our goal.

www.akbizmag.com • Alaska Business Monthly • April 2011


Fr

Volume 27, Number 4 Published by Alaska Business Publishing Co. Anchorage, Alaska

EDITORIAL STAFF Managing Editor Associate Editor Art Director Art Production Photo Consultant Contributing Photographers

Debbie Cutler Susan Harrington Candy Johnson Linda Shogren Chris Arend Judy Patrick Azimuth Adventure Photography

BUSINESS STAFF President National Sales Mgr. Account Mgr. Account Mgr. Traffic Coordinator Accountant

Jim Martin Charles Bell Anne Campbell Bill Morris Ann Doss Mary Schreckenghost

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

Pacific Northwest Advertising Sales 1-800-770-4373 ALASKA BUSINESS PUBLISHING CO., INC. ALASKA BUSINESS MONTHLY (ISSN 8756-4092) is published monthly by Alaska Business Publishing Co., Inc., P.O. Box 241288, Anchorage, Alaska 99524; Telephone: (907) 276-4373; Fax: (907) 279-2900, ©2011, Alaska Business Publishing Co. All rights reserved. Subscription Rates: $39.95 a year. Single issues $3.95 each; $4.95 for October. Back issues $5 each. Send subscription orders and address changes to the Circulation Department, Alaska Business Monthly, P.O. Box 241288, Anchorage, AK 99524. Please supply both old and new addresses and allow six weeks for change. Manuscripts: Send query letter or manuscripts to the Editor. 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 Monthly is prohibited. Address requests for specific permission to the Editor, Alaska Business Monthly. Online: Alaska Business Monthly is available online from Data Courier and online from Thomson Gale. Microfilm: Alaska Business Monthly is available on microfilm from University Microfilms International, 300 North Zeeb Rd., Ann Arbor, MI 48106.

the

Ed

itor

One Large Quake is All it Takes

Vern C. McCorkle, Publisher 1991~2009

om

Alaska ripe for the big one

O

K, I admit it. I don’t have an emergency readiness kit. I did at one time. In fact, the water still sits in a trunk in my closet, now 15 years old. I also have 15-year-old military rations in the same area. The Japan quake/tsunami disaster, on the hearts of so many, taught me a valuable lesson. I need to get prepared. And do it now. By 9:30 a.m. today, March 17, there were about 30 earthquakes reported in Alaska, according to the Alaska Earthquake Information Center (AEIC), funded by State and national agencies and located at the Geophysical Institute at the University of Alaska Fairbanks. They ranged in size from less than 1.0 magnitude to 4.13 magnitude and struck many regions of the state, including Cook Inlet. The website reports about 22,000 earthquakes a year, statewide. That’s a lot of shaking. Break that down, it’s 50-100 daily or 400-700 weekly on average. You’ve heard the story: It’s not IF we will have another big one like the 1964 9.2 earthquake/tsunami that we’ve all been told about or lived through that killed 132 people. It’s a matter of WHEN. And when could be today. When could be tomorrow. This time, more could die as our population is growing and growing and

growing, with about 700,000 statewide, and more than 290,000 in Anchorage, according to the latest U.S. Census data.

Are you ready? There’s an easy, dowloadable brochure at www.aeic.alaska.edu/html_ docs/nextbigeq.html titled “Are you prepared for the next big Earthquake in Alaska” that tests your readiness skills and gives tips for surviving a large earthquake. I suggest you take a look at it. It explains how Alaska has more earthquakes than any other part of the U.S. and is one of the most seismically active areas worldwide. Also of note: Earthquakes larger than magnitude 8.0 hit on average of once every 13 years in this state – and this goes back to 1900! One between 7.0 and 8.0 magnitude hits EVERY year. There are too many tips in this 25plus page brochure to even begin to tell you how to prepare for the earthquake that will happen – sometime, perhaps even before the ink on this page dries. Be prepared. I’m going out to get my earthquake readiness kit tonight after work. Or at least by this weekend.

— Debbie Cutler Managing Editor

www.akbizmag.com • Alaska Business Monthly • April 2011

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Inside Alaska Business Southcentral Foundation to Build Wasilla Clinic

S

outhcentral Foundation chose DOWL, NBBJ, Neeser Construction and Tyonek Contractors to design and build a new primary care center in Wasilla. The facility will serve 7,000 Alaska Natives in the Palmer-Wasilla area. Construction is set to begin this spring with completion estimated for September 2012. Funding for the project comes from $40 million in direct loan financing from the U.S. Department of Agriculture and another $10 million from Wells Fargo. Southcentral Foundation also received a Joint Venture Construction Program agreement through the Indian Health Service. Under this agreement, the IHS will provide financial support for operations, primarily staffing, for 20 years. n

Providence Earns National Award

T

he Newborn Intensive Care Unit at Providence Alaska Medical Center received the 2010 John M. Eisenberg Patient Safety and Quality Award. Providence was one of three honorees to receive the award from The National Quality Forum and The Joint Commission. The NICU team was awarded for their innovation in patient safety and quality at the local level, specifically the work being done through their multi-year quality improvement project to eliminate catheter-related blood stream infection. “Our mission at Providence Alaska Medical Center calls us to serve the

8

poor and vulnerable. The tiny babies in our newborn intensive care unit are possibly our most vulnerable patients – most susceptible to infection and most in need of the safest, highest-quality care we can provide,” said Dr. Richard Mandsager, chief executive, Providence Alaska Medical Center. “Our NICU team’s dedication to eliminating catheter-related blood stream infections for these fragile, immune-compromised infants illustrates our mission in action.” n

Compiled By Nancy Pounds customer-friendly alaskaair.com website, mobile boarding passes and other innovations to make travel easier for passengers. “We are extremely proud to receive this award,” said Joe Sprague, Alaska Airlines’ vice president of marketing. “In addition to recognizing our airline’s commitment to technology innovations, it also reflects directly on our employees’ passionate dedication to efficiency, excellence and taking good care of our customers.” n

Alaska Airlines Lands Technology Honor

A

laska Airlines received the 2011 Airline Technology Leadership Award by Air Transport World magazine. Alaska Airlines received the honor once before in 2003, recognizing the company’s flight safety innovations and airport operations, ticket distribution and marketing and customer technology. The magazine officials recognized Alaska Airlines’ commitment to operational efficiency and environmentally friendly technology. The airline pioneered the development and introduction of required navigation performance, which is being adopted worldwide and is a cornerstone of the Federal Aviation Administration’s NextGen air traffic management system. Editors at the magazine also commended Alaska’s patented Airport of the Future in Anchorage and Seattle, which eliminated the traditional ticket counter and has reduced customer check-in times by as much as 90 percent. In addition, magazine editors noted Alaska Airlines’ digEplayer handheld movie viewer,

Porcaro Communications Nabs Honor for GCI Ad

P

orcaro Communications won a Gold Pixie Award from the American Pixel Academy for a television ad created for General Communication Inc. The ad won in the motion graphics category. The ad, entitled “New Northern Lights,” features fast-motion footage of Alaska and U.S. destinations, with light effects superimposed on the scenes. The Pixie Awards honor outstanding work in television motion graphics, effects and animation. n

State Grants Help Rural Agencies

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he State of Alaska awarded four domestic-violence-prevention grants to groups in rural Alaska. The Department of Health and Social Services Division of Behavioral Health will oversee the grant program. Successful applicants proposed new ideas, demonstrated community involvement and set measurable goals to reduce domestic violence and sexual assault in

www.akbizmag.com • Alaska Business Monthly • April 2011


Inside Alaska Business their regions, which include Bethel, Dillingham, Kodiak and Sitka. Safe and Fear-Free Environment in Dillingham received a grant of $372,642 in the first year and up to $1 million per year in the next three years. The group will also serve Aleknagik. Three grants of $200,000 per year for this year and the next three years were awarded each to Sitkans Against Family Violence, which serves Sitka, Kake and Angoon; Association of Village Council Presidents to serve Bethel and surrounding villages; and Kodiak Area Native Association to serve Kodiak, Port Lions, Akhiok, Karluk, Old Harbor, Ouzinkie and Larsen Bay. n

Fishing Group Buys Wards Cove Assets

B

SAI Partners LLC purchased the fishing assets of Seattle-based Wards Cove seafood company. BSAI Partners is a joint venture between Siu Alaska Corp. and Coastal Villages Pollock, wholly owned subsidiaries of the Norton Sound Economic Development Corp. and Coastal Villages Region Fund, respectively. The Brindle family founded Wards Cove in Ketchikan more than 80 years ago, and currently fishes and processes pollock, cod and crab in the Bering Sea, among other fishery-related interests across Alaska. NSEDC and CVRF are Community Development Quota groups. The CDQ program, a federal fisheries management program promoting fisheriesrelated economic development in Western Alaska, is comprised of six groups. The acquisition of Wards Cove includes

seven trawlers and one crab vessel, as well as ownership in nearly 4 percent of the pollock quota. n

KeyBank’s Alaska Team Earns ‘District of the Year’

K

eyBank’s Alaska District has been named the 2010 District of the Year among KeyBank N.A.’s 21 districts nationwide. The award recognizes the highest ranking district based on overall financial performance, service to clients and commitment to community. “Our employees are incredibly dedicated to the clients and communities we serve,” said Brian Nerland, president of KeyBank’s Alaska District. “Our bankers work as a team to provide strong financial solutions and advice, and we’re grateful to those Alaskan consumers, businesses, nonprofits and pubic entities that have rewarded us with their business.” KeyBank Alaska District’s performance highlights include increasing deposits over 2010, achieving excellent customer services survey scores, and demonstrating a commitment to the community through volunteerism and philanthropy. Key provides commercial banking, private banking, consumer banking, investment services and mortgage services through its 17 branches in Alaska. n

Weidner Funds UAA Business School Chair

D

ean Weidner, owner of Weidner Property Management, pledged to donate $3 million to establish an

endowed chair in the University of Alaska Anchorage’s College of Business and Public Policy. The Weidner Chair in Business Management will help the college offer students opportunities to learn from top professors or business professionals skilled in a specific field. In 2006 Weidner donated $1 million to UAA to create an emphasis in real estate and property management within the Bachelor of Business Administration finance degree. The first appointment to the Weidner Chair will be a professor of property management and real estate. The person selected for the role will work with the Alaska business community, pursue relevant research and develop an expanded curriculum to include courses in key concepts of residential and commercial property management, affordable housing, military and senior housing and issues relevant to Alaska. “Creating an endowed chair in business management represents a significant investment in the future business leaders of Alaska and a deep commitment to business education at UAA,” said Elisha Baker, dean of CBPP. Weidner Property Management offers rental housing and develops new housing facilities. Weidner properties are located in Alaska, Arizona, Colorado, Texas, Washington and Canada.

Firm Earns National Ranking

S

hannon and Wilson Inc. was listed among the top 500 U.S. design firms, according to Engineering NewsRecord’s annual ranking. The geotechnical and environmental consulting firm was ranked No. 186, up 74 spots

www.akbizmag.com • Alaska Business Monthly • April 2011

9


Inside Alaska Business from its listing in past years. The listing is based on design-specific revenue. n

Seafood Symphony Honors Entrees

T

rident Seafoods’ Wild Alaskan Peppered and Smoked Sockeye Salmon won grand prize in the Alaska Symphony of Seafood. The category winner won top honors for garnering the most overall votes. Winners were announced in February at the Gala Soiree in Anchorage. The New Products Contest was judged in Seattle in early February, featuring chefs and industry experts picking the best new seafood products for the 18th annual event. Trident Seafoods also earned first place in the foodservice category with Crispanko Alaska Pollock Mini-Sliders. Orca Bay Seafoods’ Sockeye Salmon with Tuscan Herb Sauce topped the retail category. Trident Seafoods and its Wild Alaskan Peppered and Smoked Sockeye Salmon won the smoked category. At the Anchorage event, the People’s Choice winner was Wayne Carpenter’s Candysmoke. Winners from each category, and the grand-prize winner, received booth space at the International Boston Seafood Show in March, as well as airfare to and from the show. n

SBA Helps Small Businesses Refinance

S

mall businesses facing maturity of commercial mortgages or balloon payments before Dec. 31, 2012, may be

10

able to refinance their mortgage debt with a 504 loan from the U.S. Small Business Administration under a new, temporary program. The new refinancing loan is structured like SBA’s traditional 504, with borrowers committing at least 10 percent equity and working with third-party lending institutions and SBA-approved Certified Development Companies in the standard 50 percent/40 percent split. A key feature of the new program is that it does not require an expansion of the business in order to qualify. SBA began accepting refinancing applications on Feb. 28 and initially opened the program to businesses with immediate need due to impending balloon payments before Dec. 31, 2012. SBA will revisit the program later and may open it to businesses with balloon payments due after that date or those that can demonstrate strong need in other ways. The program, authorized under the Small Business Jobs Act, will be in effect through Sept. 27, 2012. n

Wells Fargo Alaska Team Members Raise Record $437,000 for Nonprofits

W

ells Fargo team members from Barrow to Ketchikan donated a record $287,000 during the company’s annual Alaska Community Support/ United Way fundraising campaign last fall. The $287,000 donated by Wells Fargo team members in Alaska is the highest total ever and a 39 percent increase over 2009. Wells Fargo contributed an additional $150,000 for a total investment of $437,000 in nonprofit

organizations throughout the state. “During the second year of a national recession, our team members stepped up again to exceed our fundraising goal and contribute $80,000 more than last year,” said Richard Strutz, Wells Fargo regional president for Alaska. “The results of this campaign demonstrate our enduring commitment to help Alaskans in need by investing in the communities where we live and work.” Each year, Wells Fargo invests $1.5 million in more than 280 nonprofits and schools in Alaska. Wells Fargo’s Alaska team members logged a record 10,100 volunteer hours in 2010. n

New Book Goes to 2nd Printing

M

ichael Travis of Anchorage, whose family history novel, El Gancho, won the national award for Best Novel from National Association of Press Women, will see his new book go to second printing this spring. Melozi is a memoir of his first summer in Alaska, when he worked at Melozi Hot Springs, helping the now-legendary Len and Patricia Veerhusen build their lodge. Melozi: A Teen’s Summer Job Lands Him an Adventure in the Alaska Bush, was released July 2010; enthusiastic readers accelerated plans for the next edition. “I get emails from men all the time, who identify with what I went through out there,” said Travis. “I was raised in Montana. I had Boy Scout badges for everything, camping experience, was good at fishing, could shoot a .22, and even had a certificate for driving heavy equipment, but Alaska almost got the better of me.”  q

www.akbizmag.com • Alaska Business Monthly • April 2011


View

from the

Top

Compiled By Peg Stomierowski

Paul and Janice Villnerve Owners

Moose Bites Personal Chefs oose Bites opened for business in November 2010. Paul and Janice Villnerve, who met in college and have twin degrees in mechanical engiM neering, hail from Louisiana, where southern hospitality and culinary adventure go hand-in-hand. Paul is professionally licensed and has been a practicing engineer for 13 years. Janice retired early to raise their children and has authored a children’s book. Having to feed their large family in wise ways, the Villnerves used their experience to serve others who lack the time it takes to put complex meals on the table. Their nine children (ages roughly 12, 10, 9, 8, 6, 5, 3, 2 and 1) are home-schooled, getting hands-on-training in business enterprise as well. While personal chef services are widely available in the Lower 48, the Villnerves say the idea is just catching on in Anchorage. INVESTMENT IN HEALTH

We cater to health-conscious executives and busy couples committed to eating fewer processed foods. It’s an investment in the future. Some people spend their extra money on depreciating, material items such as new cars; others are interested in investing in a lifestyle service with the capacity to improve their health. COMMUTER TRAFFIC In the Mat-Su Valley, commuting is a major time-consumer. We help commuters

realize time savings daily by eliminating planning, shopping and cooking dinner. Some have decided to eat all organic foods, while others simply want to increase their fiber intake and keep their dietary sugar content low. COMPETITIVE EDGE

Our closest competitors would be shops where customers go in and make meals to take home. But in our business, we’re able to listen to what each customer wants and to customize the cooking more. We consider everything from salt content to spiciness and types of cuisine, and we work with clients to prepare menus they feel good about eating. Their choices aren’t limited to what is being offered in the shop. HEAT, EAT & ENJOY

The clients don’t need to find time to go prepare meals. We do it all, in their homes, while they are at work. When they come home, typically five entrees and sides are prepared, portioned, packaged, labeled and refrigerated. All they have to do is heat, eat and enjoy. BUSINESS DRIVERS

Health consciousness and busy schedules tend to drive our business. As people’s lives fill up with work and activities, the easy thing to do is to eat fast food or frozen entrees from the grocery, neither of which are very healthful options.

©2011 Chris Arend

COOKING UP SUCCESS

We once had a request for a dinner for two. The client wanted to provide a romantic private dinner for a spouse. We created an elegant menu to be prepared and easily heated and served. That’s not typical, however, and truly every order is different. We even handle cooking for at-home dinner parties. For more information: www.moose-bites.com or chef@moose-bites.com. q Janice and Paul Villnerve www.akbizmag.com • Alaska Business Monthly • April 2011

11


FISHERIES

Photos courtesy of POORT

The Christi-Rob crew (from left) Jeff Farvour, Walt Pasternak and Megan Pasternak catch fish and are participants in Alaskans Own.

Sitka’s ‘Alaskans Own’ Seafood Subscribers get their fish from local waters

S

By Will Swagel

itka ranks as a top commercial and charter fishing port and many locals have big chest freezers filled with their catch. But others, like Cindy Litman, a Sitka-based educational researcher, don’t fish and have to depend on family and friends for handouts. Despite its location right on the fishing grounds, Sitka’s retail choices of local fish have been limited and expensive. So Litman was delighted to buy a subscription last summer to “Alaskans Own” seafood – a new Sitka-based Community-Supported Fisheries (CSF) program. For a $390 share, Litman was able to pick up half a dozen allotments of five to six pounds each of a variety of local species caught

12

in season by local fishermen. Every other week during summer, she and the 17 other subscribers drove, walked or biked to a large, weathered, old waterfront sawmill building, where enthusiastic young men and women dispensed vacuum packages of high quality, flash-frozen fish. A definite air of celebration made each pickup a pleasant task. Litman said she felt good when she found out among the commercial fishermen supplying Alaskans Own were a few of her friends. And she found the product to be top-notch. “What was really surprising was how good the fish tasted,” Litman said. “That was an extra benefit I hadn’t expected. It was the best fish we ever had.”

Getting the Community On Board

Alaskans Own is one part of a larger effort created by two marine organizations – the Sitka-based Alaska Longline Fishermen’s Association (ALFA) and the North Pacific Fisheries Trust, which promotes sustainable fisheries. Together they formed the Alaska Sustainable Fisheries Trust, which is a nonprofit organization that invests in community-based fishermen who have a commitment to conservation of the fishing stocks and the marine environment. Linda Behnken, a Sitka leader in fish politics and former member of the North Pacific Fishery Management Council, is ALFA’s long-time

www.akbizmag.com • Alaska Business Monthly • April 2011


executive director. She said the Alaskans Own subscription program is one of three components. n A conservation effort that ALFA runs where fishermen map habitat and work together to control bycatch – species that they catch while targeting other species. A certain amount of bycatch can be kept as part of the multi-species fisheries, but bycatch above that level is best avoided. n Marketing local fish to local consumers both to raise money for conservation efforts and to get non-fishers interested in the health of the fisheries. n Providing loans to conservation-minded local fishermen at attractive terms, so that they may buy quota share. Behnken said with support from the North Pacific Trust and the Maine- and Switzerland-based Oak Foundation, ALFA initiated the bycatch and mapping work two years ago and launched the CSF last year. The quota lending is off to a slower start due to the nation’s economic conditions. So Cindy Litman got her fish.

Respecting the Economic Environment

Like the majority of fish landed in Sitka, which are destined for Lower 48 or overseas markets, Alaskans Own fish is trimmed and frozen at one of the large processors dominating the downtown Sitka waterfront. Modern flash-freezing and vacuum packing make the quality of the frozen fish comparable to fresh and with a shelf life that can be counted in months. “It’s really important for us to support the local supply chain,” said Behnken, noting the waterfront processors fillet and freeze or otherwise prepare the fish. “We are right there at the boat and designate the fish that is processed to our specs, but we buy right at the processor.” Behnken believes the Sitka program is the first in Alaska and one of only three in the U.S., at the time of this writing. Other programs can be found in Port Orford on the southern Oregon coast and at Port Clyde, in Maine, which is believed to be the first CommunitySupported Fishery (CSF) in the country. It started in 2006.

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Glen Libby is a Maine fisherman and chairman of the Midcoast Fishermen’s Association, which operates the Port Clyde CSF. Libby credits North Carolina anthropologist Susan Andreatta with first suggesting that fishermen use the model of Community-Supported Agriculture (CSA) programs and band together to get better prices. CSAs are found throughout the country and often provide the boxes of fresh, seasonal produce-by-subscription that are popular with local- and organic food enthusiasts. CSA consumers, in effect, pre-buy a “share” of the harvest of a particular farm or group of farms. CSFs pre-buy a portion of the fishermen’s seasonal catch. Port Clyde fishermen market their winter shrimp and summer cod under the name Port Clyde Fresh Catch. Unlike Sitka’s Alaskans Own, Port Clyde Fresh Catch is being sold to restaurants and retail locations. Although the town of Port Clyde is tiny, it is within driving distance of Portland, Maine, and Boston, and ultimately the New York metropolitan area. The CSF now has 500 subscribers. A third of the local quota – some 300,000 pounds – is now marketed under the Port Clyde brand. Co-op members are expanding their offerings to include lobster, crab and scallops. Libby said they have created 25 jobs in his town of 250 year-round residents. If you’re at the Liberty Hotel in Boston, you might well find Port Clyde Fresh Catch seafood on the menu. Libby said the hotel is his biggest customer.

Vote with Their Forks

Sitka’s Alaskans Own, Port Clyde Fresh Catch and the CSF at Port Orford, Ore., all stay in touch with their customers through informational handouts that accompany the fish pickups and with online newsletters. The Port Orford Ocean Resource Team (P OORT), a fisheries conservation and advocacy group, has a quaint wooden headquarters in a quaint seaside town. While they don’t have a subscription program, like the ones in Sitka and Port Clyde, they sell fish out of the headquarters. Getting people to be involved in fisheries issues because they have a larger stake is one of the goals of all three organizations.

© Mim McConnell/ mimsmissives.com

FV Cherokee, one of the Alaskans Own fleet vessels, unloading halibut that will be sold through the cooperative.

“It’s an important educational tool,” said Sitka’s Behnken. “It all works to strengthen the community and the fishermen and the resource.” In Port Orford, they are working hard to develop a brand with the kind of name recognition that Kobe or Angus beef enjoy, said Marketing Manager Aaron Longton, himself a Port Orford fisherman. Port Orfordbranded fish is being sold in Medford and Ashland restaurants and farmers markets. They supply fish for the cafeterias at Lewis and Clark and Reed colleges and at Intel and Addidas. He said chefs and consumers are – like Sitka’s Cindy Litman – delighted at the quality of the flash frozen product and are being encouraged to mention

www.akbizmag.com • Alaska Business Monthly • April 2011


the brand by name. Port Orford also sells fresh product to the Ashland Food Co-op and several area restaurants

No Mystery Fish

If there is one thing people involved with all three CSF’s agree on, it’s that their organizations received a big bump from the so-called local foods movement. “People are increasingly interested in who grew their food or who caught their fish,” said Behnken. “They want a personal connection to the farmer (or fisherman) who produced their meal.” For even more of that personal touch, the websites of all three companies share bios and photos of member fishermen and vessels. Longton seconded that sentiment. “`Mystery fish is a hard sell for a lot of people now. You don’t know how your fish was harvested and by who and where. We can definitely attest to the traceability of our fish!” POORT Executive Director Leesa Cobb said that was in the minds of the three local fishermen who put up the seed money to start the CSF. “We said, ‘The public is begging for local food and we’ve got to take advantage of the timing.’” Cobb said POORT received an Oregon state grant to study the marketability of local fish to local markets. The researchers gauged the size and makeup of the local quota and timing of the fishing season. “They also looked at, ‘Can you brand Port Orford’s story?’” Cobb said. “Small boats, family businesses – kind of the last of a kind. It taught us how to talk about our project.” This story of fish that is marketed locally, caught in a conservation-minded manner by family businesses keeping money in the region is selling well. Port Clyde’s CSF is growing steadily and Port Orford’s is hoping to get new investors, to have any hope of keeping up with demand. Behnken said the Sitka CSF would be making outreaches to Juneau in the coming year. Last fall, Port Clyde’s Glen Libby and Port Orford’s Leesa Cobb came to Sitka to discuss their collective experiences. “We’re working with fishermen from other parts of the country with the prospect of forming a national network of these programs,” she said.  q www.akbizmag.com • Alaska Business Monthly • April 2011

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Marketing Works

By Ron “Cat” Mason

Marketing and Advertising Distinguishing the differences

M

arketing and advertising are completely different entities. According to the Webster Dictionary, marketing is: “The business activity of presenting products or services in such a way as to make them desirable.” Advertising is: “The public promotion of something such as a product, service, business, or event in order to attract or increase interest in it.”

Facilitating Exchanges

Marketing is meant to persuade, whereas advertising is made for a call to action. Marketing keeps you in the mindshare of customers so as to keep them coming back for your product or service. Advertising allows the sales strategy to sell a product or service that first and foremost fulfills the wants and needs of consumers. When customers’ wants and needs are fulfilled profits follow. Marketing is broken down into several components, including market research, advertising, media planning, public relations, distribution, customer support, sales strategy, product pricing and feedback from customers. Marketing should support advertising in order for it to be more effective. Primarily marketing, if done correctly, will generate sales leads. Marketing creates an identity of your business so prospective customers will want to buy your product or use your services. Marketing takes time and can involve hours of research for a marketing plan to be effective. Think of marketing as everything an organization does to facilitate an exchange between business and the consumer.

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Without marketing there would be no business, and advertising is just one of the marketing tools needed to generate business. Both marketing and advertising need work hand-in-hand to be effective in reaching and getting customers to be proactive in buying a product or service. Another way to help distinguish between marketing and advertising is this: marketing consists of planning a marketing strategy and the correct steps in implementing the strategy.

© Chris Arend 2011

Ron “Cat” Mason

What’s the Difference?

Effective marketing will generate new customers by making them aware of your business. Knowing the difference between marketing and advertising lets businesses become and stay successful. Marketing is not an overnight activity; it takes time and can involve in-depth research for a marketing plan to be utilized effectively. Think of marketing as whatever an organization does to make it possible for an exchange of product or services between a company and their consumers. Implementation of an effective marketing plan needs to be done on a consistent basis, only 1 percent to 3 percent of the population at any given time is interested in buying a product or a service. Marketing frequency is the only way for a business to stay in the consumer’s mindshare. Contacting prospective clients through advertising has to be done for the long haul. Marketing to your target market month after month keeps the business’s identity in front of existing and future clients.

Advertising Action

Advertising is just one component of marketing. Advertising’s job is to let the consumer know about your business product or service that will generate a call to action. This involves creating ads, the placement of these ads along with the frequency of these ads. Most common venues for advertising include magazines, newspapers, direct mailings, television, radio and the Internet. Advertising’s sole purpose is to increase sales – it’s the biggest expense of a marketing plan. Advertising is the story told about a product or service that will attract the attention of consumers and encourage the consumer to act. By understanding the differences between marketing and advertising, businesses will have the knowledge to keep their current customers and acquire new ones.  q About the Author Ron “Cat” Mason is the founder and CEO of CM&A Consulting, a business and marketing consulting firm. Mason is a member of the Anchorage Chamber of Commerce as well as Business Networking International (BNI).

www.akbizmag.com • Alaska Business Monthly • April 2011


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MANUFACTURING

Adding Value to Resources In-State

More jobs, bigger tax base, lower consumer costs Photos by Janet Burton, UAA Logistics Department

University of Alaska Anchorage Professor of Logistics Darren Prokop by a rail barge at the port in Whittier.

V

By Heidi Bohi

alue-added manufacturing has long been touted as the galloping white steed that could ride into Alaska on the heels of a collapsing oil industry, leaving in its wake economic development benefits that create jobs, business for statewide companies, and a bigger tax base for local communities. Making something from natural resources within the state rather than exporting the resources in the raw would also allow Alaskans to buy the products

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made here without having them shipped back from out of state. Whether the resource is logs, fish, minerals, or oil and gas, industry and academic leaders say the potential and resulting economic benefits are unlimited. A bigger tax base would result from value-added companies and transportation carriers. There would be more manufacturing jobs in a more diverse economy. The move away from natural resources would mean more sustain-

able economic development. Youth would be less likely to leave the state in search of work because there would be more employment options. For consumers, more efficient manufacturing and transporting of goods would result in lower costs marketwide.

Using Our Foreign Trade Zone

“Think of cargo coming into Anchorage from Asia, such as fine clothing, textiles, flowers and fruits. It comes

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to Anchorage first, then it’s shipped to the Lower 48 where it’s packaged and cross-docked, then made available for sale Outside and in Anchorage – which means it has to fly back to Alaska,” says Darren Prokop, professor of logistics at the University of Alaska Anchorage. “What if the value added application was done in Anchorage in our foreign trade zone? There would be no tariff applied.” The question, though, is what will it take to make this a reality and who is going to take the lead in making it happen? Although several organizations, businesses and government entities continue to work to advance the idea of value-added manufacturing, including the Anchorage Economic Development Corp., World Trade Center Alaska, the Alaska Chamber of Commerce and the University of Alaska, to date, most efforts have fallen flat, including the State’s 1980s attempts to create an agriculture industry in the Interior, and the seafood-processing plant in Anchorage that folded several years ago. The list of value-added manufacturing successes is limited to only a few, which are in the food services industry, including fish processing, the Matanuska Creamery and Alaska Sausage and Seafood. Despite other failures, there has also been some success in creating Alaska value-added manufacturing, in one case creating an industry. Agrium Corp.’s fertilizer and liquefied natural gas (LNG) plant, owned by ConocoPhillips Alaska and Marathon Oil, are past examples of two of the larger successes. (Note: Agrium did shutter it’s doors years ago and the LNG plant will soon do same.) Refineries near Kenai, Fairbanks and Valdez, are also cases where industry-led initiatives were given crucial help by the State in making State-owned royalty crude oil available.

Alaska at ‘Tipping Point’

Although Alaska is at the “tipping point” and has certain existing and emerging transportation advantages working in favor of value-added manufacturing, the missing link to success, Prokop says, is that all of the pieces are not being pulled together to demonstrate that the state has the critical mass needed to be attractive to manufacturers and transportation carriers. Now, he says, it is simply a matter of disparate groups of www.akbizmag.com • Alaska Business Monthly • April 2011

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people recognizing the important potential and bringing it all together with other components so these efforts are tipped in the right direction. “It is looked at in isolation – it is looked at only in terms of a gas-and-go point of view and that is not attractive to carriers or manufacturers who might want to do business here. We need to sell the potential and get out of tunnel vision thinking and once we’ve made it past that tipping point and have manufacturers here, success will naturally follow,” Prokop says. “Alaska, in terms of value-added manufacturing, is at a tipping point. We have pieces in place, now it’s just a matter of the right people nudging it and it will create potentially irreversible momentum if it’s done properly.” The university’s role, he says, is to teach the state what is allowed and what isn’t, keeping in mind what makes logistical sense. From there, government and business need to market the state, which requires the airport and Port of Anchorage working to attract manufacturers. At the same time, he says, private industry has to take the lead since it is the one risking capital and working directly with manufacturers on a day-to-day basis. “Private industry is in a better position to know what needs to be done,” Prokop says. “It is up to them to demonstrate the cost effectiveness of locating here, to run the numbers and explain what a friendly business environment this is.” The simplest definition of value added, Prokop says, is “a process that takes place when something is done to make a product more valuable, more complex, more desirable and more marketable.” Value-added manufacturing, then, is simply the process that takes place when all of these factors are combined, then value is added beyond what was originally intended. Turning steel into an automobile, scrap wood into violins, or simply taking a product from Japan to China, packaging it, and shipping it out – these are just a few examples of value-added manufacturing. The commercial fishing industry in Dutch Harbor is a prime example of how value-added manufacturing has been working for decades, Prokop says. Fish are harvested from the Pacific Ocean and Bering Sea, brought

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into port, processed then sold to Alaska restaurants and those outside of the state and country. At the same time, there are even more examples of where value-added manufacturing is not working, though the potential is there. Crude oil from Prudhoe Bay is loaded onto supertankers in Valdez before it is shipped to the Lower 48 states for refining, which means local consumers bear the brunt of those additional costs.

Enhancing Air Cargo

Anchorage’s strategic geographic location for global logistics operations means it is nine hours or less from 95 percent of most of the world’s population centers, is closer by air to Europe and Asia than any other North American international airport, and handles more air cargo tonnage than any other U.S. airport. Although crude oil is the most obvious example of value-added manufacturing potential, with less restrictive air cargo laws, this could also be opened up to many other industries. In addition to having the operational advantage of “air cargo transfer,” which is the process of moving shipments from one plane to another, the potential exists for this process to be taken one step further. Instead of simply moving freight from one plane to the other, transportation and elected officials are working to increase air cargo liberalization, which would allow it to be laid over at a foreign trade zone of the airport where various types of value-added improvements could be applied before it was transferred to another plane for duty-free shipping. In Alaska, cargo carriers can do more in terms of transferring cargo among planes in their fleet and the state has more carriers than any airport in the country. Once cargo arrives from Asia and Outside, a lot of it simply moves on, though Prokop says this stop on the route offers the perfect value-added opportunity that could easily be capitalized on instead of just “moving cargo from one belly of the plane to another.” “Because there are so many options for international air cargo carriers, and so many of them are going to so many locales in Asia, it makes more sense to

do the value added here than it does in Memphis, Seattle, Louisville or other superhubs,” Prokop says, adding that it opens up the number of ways the cargo can be distributed once the value-added application has been implemented.

Expanding Port of Anchorage

In addition to enhancing existing air cargo transfer options at the Ted Stevens International Airport in Anchorage – which were originally secured by the late Sen. Ted Stevens – Prokop says once the Port of Anchorage expansion is completed, its freight-handling capacity also needs to be leveraged to attract U.S.-Asia cargo trade along the great circle route. Because all container ships coming from ports north of Los Angeles on their way to Asia have to pass on or near Alaska waters, this gives the state another advantage, as vessels have to head north first. The port’s intermodal expansion program centers around the road and rail extension, which will improve cargo flow and reduce traffic conflicts outside of port boundaries. The marine terminal redevelopment portion includes expanding commercial dock space and improving the rail connection to the port. Eight new berths will also accommodate barges, containers, petroleum and military vessels, along with a new dock expansion, new terminal, and road and rail extension. All of this adds up to making Anchorage “a potential Singapore of the north,” Prokop says, with an added advantage: “The port of Anchorage, compared to others in the Lower 48, is not subject to the congestion those ports have in terms of clearing, nor do we have customs delays they have.” This will become more apparent as the world economy recovers and congestion increases in hub areas such as Seattle, Los Angeles, Long Beach and Oakland, while in Anchorage it will improve because of the expanded port. Although reaching the tipping point may seem daunting, he says, there is no reason why it cannot be realized in less than five years with air cargo liberalization, especially with port improvements getting ready to come online. The only hold up is lack of infrastructure. “Private industry needs to be ready to pounce and sell Alaska,” he says. q

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www.akbizmag.com • Alaska Business Monthly • April 2011

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HR M at t e r s

By Lynne Curry

Retaliation Burns

Know the ground rules to prevail

W

hen manager Bill fired Kristi, he considered it a no-brainer and a done-deal. Kristi rarely showed up to work on time. She took excessive breaks and texted during the work day. She used the company phone and copier for personal matters. A month earlier, he had formally reprimanded Kristi for her absenteeism, tardiness and poor work habits. At the time, Kristi said she couldn’t help it because pregnancy complications made her late in the morning. Bill hadn’t known Kristi was pregnant. The day after he reprimanded her, Kristi made a complaint to the Equal Employment Opportunity Commission (EEOC), alleging unfair treatment due to pregnancy. When Bill got the formal notice, he swore out loud and then fought the charge with the truth. He pointed out Kristi’s problems and his intervention as a manager started before he or anyone knew of Kristi’s pregnancy. Kristi produced evidence showing other employees texted, made personal long-distance calls and occasionally arrived late for work. As the EEOC investigation drug on, Kristi’s behavior got worse. She dragged in to work after 9 a.m., took two-hour lunches and left for the day by 4 p.m. When Bill fired Kristi, she dropped her complaint with the EEOC, hired an attorney and sued Bill in civil court. To Bill’s astonishment, although Kristi lost her pregnancy discrimination lawsuit, she claimed victory on her retaliation charge. Retaliation claims account for 25 percent of all charges filed with the EEOC. As Bill learned, some employees take advantage of the protection filing a complaint with a regulatory body gives them, and yet manage to win if the provoked

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©2011 Chris Arend

manager fires them. Fifty-seven percent of all juries find in favor of plaintiffs who assert a retaliation complaint. As a manager, if you don’t want to lose a retaliation charge brought by a problem employee, you need to know the ground rules. Any action or behavior that has the real or perceived effect of punishing an employee for engaging in a protected activity can constitute retaliation. This both protects employees from unfair treatment and complicates a manager needing to discipline an employee with work performance problems. Federal employment and other statutes prohibiting employers from taking retaliatory or adverse action against an employee who has exercised his or her rights to complain include Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, the Occupational Health and Safety Act, the Fair Labor Standards Act, the ERISA, the Family Medical Leave Act, the National Labor Relations Act, the American with Disabilities Act, GINA and the Sarbanes-Oxley Act of 2002. To prevail against a retaliation lawsuit, the employer needs to give a legitimate, nondiscriminatory reason for any adverse employment action taken against an employee who protests his or her rights. If the employer can give

solid reasons for disciplining an employee, the burden shifts to the plaintiff employee to prove that the employer’s stated reasons for discipline actually covered up retaliation. In Kristi’s case, Bill documented her problems; however, his case weakened when Kristi produced evidence other employees had similarly poor habits. Still, he managed to convince a jury that Kristi deserved her initial discipline. Unfortunately, he stepped onto a landmine when Kristi’s behavior worsened, provoking him to fire her. What do managers need to do when a complaint or lawsuit complicates the need to discipline a problem employee? Act cautiously and make sure every decision rests on solid business reasons. Avoid dramatic actions, such as termination, because a jury can conclude retaliation when any strong discipline results after an employee protests a protected right. If the employee pushes your buttons, place the employee on paid or unpaid administrative leave or continue only a reasonable level of discipline until the initial legal action concludes. In other words, don’t hand a problem employee a win.  q About the Author Local management/employee trainer and consultant and the author of Managing Equally and Legally, Won By One and Solutions, Dr. Lynne Curry regularly provides managerial, leadership and board-training seminars as well as public seminars. For more information on The Growth Company Inc.’s training and HR On-call services to companies needing help with recruiting, team-building, strategic planning, management or employee training, mediation or HR troubleshooting, please visit www.thegrowthcompany.com.

www.akbizmag.com • Alaska Business Monthly • April 2011


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Right Moves Strategies 360

Berkowitz

Ethan Berkowitz joined Strategies 360, a Seattlebased marketing firm with offices in Anchorage, Montana, Oregon, eastern Washington state and Washington, D.C. Berkowitz is a former State legislator.

Alaska State Chamber of Commerce

Petro

Rachael Petro was appointed to serve as president and chief executive of the Alaska State Chamber of Commerce. Petro most recently ser ved as deputy commissioner for the Alaska Department of Administration.

Cook Inlet Tribal Council

Pita Benz was hired as Cook Inlet Tribal Council’s vice president of social enterprise. Benz previously served as senior vice president and manger of the commercial real estate group at Wells Fargo Bank.

Compiled By Nancy Pounds Bristol Design Build Services LLC

Jason Strickler was promoted to senior project manager at Bristol Design Build Services LLC. He joined the company in 2001 as an expeditor and has worked in various posts. He most recently served as project manager.

Alaska Energy Authority

Sara Fisher-Goad was appointed executive director of the Alaska Energy Authority. She previously served as deputy director of operations for AEA and the Alaska Industrial Development and Export Authority. She has worked for AEA in various roles since 2000.

Access Alaska Inc.

Turnbow

University of Alaska Anchorage

Tom Case was appointed chancellor for the University of Alaska Anchorage. Case most recently served as president and chief operating officer for the Alaska Aerospace Corp. He also has served as dean of the UAA College of Business and Public Policy from 2002 to 2006.

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PTP Management Inc.

Elisha Martin was promoted to broker and vice president of operations at PTP Management Inc. Martin joined the company in 2008 as property manager. John Morrison was hired as controller. Morrison most recently led the finance and accounting division for a nationwide commercial construction and development company.

Northwest Strategies

Matt Geitz was hired as traffic manager for Northwest Strategies. Geitz earned a bachelor’s degree in journalism from the University of Kansas.

ASRC Energy Services

Alaska Aerospace Corp.

Craig E. Campbell was hired as president and chief operating officer for Alaska Aerospace Corp. Campbell most recently served as Alaska’s lieutenant governor. He also has served as commissioner for the Alaska Department of Military and Veterans Affairs.

Kerry Turnbow joined Access Alaska Inc. as Interior regional director. He most recently served as clinical director at the Boys and Girls Home of Alaska, Fairbanks. He also teaches psychology at the University of Alaska Fairbanks.

Alliance received the Ocean Media Award for excellence in journalism promoting awareness of Alaska’s oceans. Jeremy Mathis of the University of Alaska Fairbanks School of Fisheries and Ocean Sciences earned the Ocean Research Award for his work conducting research in high-latitude carbon cycling and ocean acidification in the Arctic. Shell Alaska Venture received the Ocean Stewardship and Sustainability Award, honoring the company’s efforts to study offshore Arctic environments. Clarence Pautze, executive director of the North Pacific Research Board, received the Lifetime Achievement Award for his contributions to help manage Alaska’s coastal and ocean resources.

Kinneeveauk

Jeff Kinneeveauk was appointed president and chief executive of ASRC Energy Services, a subsidiary of Arctic Slope Regional Corp. He most recently served as senior vice president of shareholder programs for ASRC. He has worked for ASRC companies since 1997.

Alaska SeaLife Center

The Alaska SeaLife Center presented the Alaska Ocean Leadership Awards earlier this year. The Center for Alaskan Coastal Studies received the award for Ocean Literacy. The Marine Conservation

Geitz

Seward Chamber of Commerce/Convention and Visitor’s Bureau

Charles Bowman was appointed executive director for the Seward Chamber of Commerce/ Convention and Visitor’s Bureau. He has worked as a communications specialist with the U.S. Navy, Chamber of Commerce government affairs and executive director positions, and as a business owner and manager.

www.akbizmag.com • Alaska Business Monthly • April 2011


Right Moves Wells Fargo

Kyle Bellnap was appointed merchant card services specialist for . Wells Fargo in Alaska. Bellnap began his career with Wells Fargo as a teller in 2007 and has held several other roles at the bank. Bellnap He is studying at Alaska Pacific University to earn a bachelor’s degree in business management.

Sponsored as the director of retail and special projects at the White Pass and Yukon Route Railroad.

First National Bank Alaska

Betsy Lawer was elected to the Federal Reserve Bank of San Francisco’s board of directors. She will serve for three years. Lawer is vice chairwoman at First National Bank Alaska. Lawer previously served as a board member for the Seattle Branch of the Federal Reserve Bank of San Francisco from 1997-2003.

National Cherry Blossom Festival

U.S. Sen. Mark Begich chose Grace Abbott to represent Alaska as the state’s princess in the annual Cherry Blossom Festival in Washington, D.C. A U.S. senator chooses a representative annually to participate in the festival, which is set for March 26April 10 this year. Abbott is a sophomore at George Washington University majoring in political science and Spanish.

GeoNorth

by

Northern Air Cargo

Shannon

Schroeder

Rathburn

Collin Schroeder joined GeoNorth as a programmer/analyst. He has experience as a consultant for the University of Alaska Anchorage and State government agencies. Wes Rathburn was hired as a programmer/analyst. He is a former staff sergeant with the Alaska Army National Guard. Both men earned degrees in computer science from the University of Alaska Anchorage.

Icy Strait Point

Stuart Campbell was hired as food and beverage director at Icy Strait Point, a private cruise ship destination in Southeast Alaska owned by Huna Totem Corp., the Alaska Native village corporation for Hoonah. Campbell has 22 years of food-service industry experience, including posts as executive chef at Waterfall Resort near Ketchikan and as food service supervisor and rental shop manager at Eaglecrest Ski Area in Juneau. Eleanor Davenport was hired as retail director. She most recently served

Alaska Office of Boating Safety

Mike Morris was chosen the Alaska Boating Safety Educator of the Year. Morris is a U.S. Coast Guard Auxiliary instructor, a State-certified Alaska Water Wise instructor and Alaska Marine Safety Education Association trainer. The Alaska Office of Boating Safety presented the annual award.

Yulista Holding LLC

Monica James was hired as senior vice president of business strategy for Yulista Holding LLC. James previously served as vice president of business operations for Alaska Aerospace Corp.

Wilson Inc.

Alaska Railroad Corp.

CIRI Alaska Tourism Corp.

Sarah Laschober was promoted to assistant reservations manager at CIRI Alaska Tourism Corp. She most recently worked as a reservations supervisor for the company. Elizabeth Adams was promoted to contract administrator. Adams has worked 10 years for the company, serving in positions from front desk agent at Kenai Fjords Tours to reservations agent at Alaska Heritage Tours.

and

Rinu Samuel joined Shannon and Wilson Inc.’s Fairbanks office as a geological engineer. Samuel graduated in 2010 from the University of Alaska Fairbanks. Catherine Hill was hired as a geologist. Hill earned a master’s degree in geoscience from the University of Wisconsin-Milwaukee. Shandra Miller joined the firm as an environmental scientist. Miller earned a degree in chemistry from UAF. Veronica Martinez was hired as administrative assistant. Martinez has 13 years of administrative experience, including seven years as an executive administrative assistant. Chris Darrah was promoted to senior principal geologist. Darrah has been with the company for more than 23 years. Mark Lockwood was promoted to associate. He has more than 28 years of experience in Alaska. Frank Wuttig was promoted to senior associate. Wuttig has been with the Fairbanks firm for 20 years as a geologic engineer.

Leary

Linda Leary was elected board chairwoman of the Alaska Railroad Corp. She has served on the board of directors since 2009. Leary is president and co-owner of Carlile Transportation Systems.

Humane Society

The Humane Society honored Rep. Bob Lynn, R-Anchorage, as Alaska’s 2010 Legislator of the Year. Lynn was recognized for his efforts during the 26th Alaska Legislature to strengthen State animal cruelty laws.

National Child Labor Committee

Frances Macon received the 2011 Lewis Hine Award for Volunteers. The National Child Labor Committee in New York City presented the award to the Alaskan, honoring Macon for nearly 40 years serving the community and at-risk children. She is licensed as a foster parent with the Department of Health and Social Services.  q

www.akbizmag.com • Alaska Business Monthly • April 2011

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TIMBER

Poppert Milling Inc. Wasilla’s local lumber yard By Jeff Mullins

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Photo by Jeff Mullins

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ccording to the father-son team of Dave and Mike Poppert, old-fashioned values like a commitment to quality, service and integrity combined with forward-looking innovation balancing efficiency, costs and environmental sensitivities have allowed their fourth-generation family business, Popper Milling of Wasilla, to remain viable even in sluggish economic times. Speaking especially to that part innovation plays in success, Dave, the founder’s grandson says, “We have learned over the years that challenges seeming to threaten a company’s survival can actually become opportunities to innovate for success.” Poppert Milling was established when Dave’s grandfather – Mike’s great grandfather – relocated to Wasilla from Colorado in 1961 with wood-molding and cabinet-shop equipment in tow. Virgil Poppert identified a niche market he thought he could address, set up shop in 1963, and began to remanufacture locally sawn lumber into molding and other high-quality finished lumbers, which he then sold to local craftspeople, cabinet makers and builders. The concept proved a good one but the growing business faced a serious challenge when product line expansion and increased sales demonstrated the region surrounding Wasilla had inadequate infrastructure to provide a reliable supply of the green lumber required to meet Poppert’s needs. Steps to assure a sustainable future for the firm had to be taken. “To assure an adequate, reliable supply of local lumber, we had to expand into logging and sawing lumber ourselves,” Dave said. Initially the cost of expanding into saw milling seemed prohibitive but the Poppert’s own research some time ago led them to investigate an innovative solution recently pointed to in academic work at Auburn University as being environmentally important,

Mike Poppert looks on while a customer examines the custom beam being produced for him at Poppert Milling in Wasilla. The portable mills allow flexibility to make custom-sized and unique products from local trees.

efficient and particularly suitable to the establishment of small enterprises in remote forested areas with inadequate infrastructure to serve local needs. Poppert’s solution in the search for sustainability was the purchase of a portable sawmill manufactured by Wood-Mizer Corp., of Indianapolis, Ind. The mill required a capital outlay about the same as the cost of a small tractor, a small fraction of the cost of a typical conventional sawmill. The new sawmill provided the flexibility and efficiency the Popperts needed to produce new unique and custom-sized products as well as the cost competitiveness both they and their customers were looking for. Dave says the thin blades utilized on a portable band sawmill means more lumber is produced from each log. “When we produce more lumber from each log on our Wood-Mizer, we make a positive environmental contribution without incurring additional

expenses,” he says. “Raw material is used more efficiently, less waste is produced and we meet demands for wood products from fewer trees – so harvests are reduced.” Today, Poppert Milling offers a wide range of high-quality wood products manufactured from locally available native Alaska species including birch, cottonwood and spruce. Products include custom-sized tongue-and-groove flooring, paneling, cabinet stock, siding, fencing, stair treads and architectural moldings made per the customer’s specifications. Also available are large beams, timbers and three-sided “house logs,” as well as complete cabin packages. A good reputation, word-of-mouth and a website keep the company busy. Poppert Milling’s continued success during hard economic times arises from the company’s use of innovation to enhance efficiency, a genuinely Alaskan and environmentally responsible approach to business.  q

www.akbizmag.com • Alaska Business Monthly • April 2011


www.akbizmag.com • Alaska Business Monthly • April 2011

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TELECOMUNICATIONS

Changes at Alaska Communications Anand Vadapalli takes the helm

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fter less than six months in his first professional position right out of college, Anand Vadapalli, the new CEO and president of Alaska Communications, left the promising job to start his own technology and management consulting business. His parents and fiancée were skeptical, but he knew if he was going to take a professional risk, he needed to do it while he was still young enough to be motivated by fear. Also not convinced the young man was making the right decision, Vadapalli’s boss sent him off with cautionary advice that continues to resound with him more than two decades later, as he settles into one of the telecommunications industry’s top positions. “If you continue to work here, you will learn at my expense,” the mentor told him. “If you go out on your own, you will learn at your expense and you will learn much faster.” Predictably, he had his ups and downs in those three-and-a-half years of being self-employed, Vadapalli says. But the lessons learned early on have stuck with him, along with the memories of getting his first contract and first check from a customer. “One of the reasons I believe I have been able to grow the way I have is that I’ve never lost sight of the fact that it is growing and winning and keeping customers that keeps businesses successful,” he says. “And I’ve learned this at my own expense.”

Extensive Background

Originally from Hyderabad, India – a major hub for the information technology industry in the country – Vadapalli, 45, earned his degree in mechanical engineering from Osmania University in Hyderabad, as well

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as a post graduate diploma in management (P.G.D.M.) from the Indian Institute of Management in Calcutta, India. After a brief time in Bombay and then Hyderabad, he moved to the United States in 1994 to start on his Ph.D. at the University of Wisconsin in Milwaukee, which he put aside to join Cincinnati Bell in 1996, launching his career in telecommunications. He held various positions there through 2003, including vice president of information technology, before serving as executive vice president and chief information officer for Network Telephone Corp., a position he held for one year. In 2004, he joined Valor Telecom as vice president of information technology, where he worked until joining Alaska Communications as senior vice president of network and IT in 2006. His first years at the company were focused on building the technological infrastructure. As executive vice president of technology and operations, then chief operating officer in 2009, his role shifted to market and customer facing, including sales and service, and product development and marketing.

Professional Partnership

Vadapalli’s advancement is the result of the company’s succession strategy. He replaces Liane Pelletier, who led the company since 2003 and is credited for rebuilding the executive lead team, implementing a new operating model and organizational structure, and overhauling the company’s image internally and externally. The two will continue to work together through the board of directors, in which Vadapalli participates in his new capacity as CEO. Although the two are known for having different management and operating styles, their professional partnership

Photo by Greg Martin Photography

By Heidi Bohi

Anand Vadapalli CEO and President Alaska Communications

and respect for each other intellectually continues to strengthen the company’s market position. “Liane is one of the smartest people I’ve ever had the privilege of working with,” Vadapalli says. “I look forward to leveraging her knowledge as a strategy adviser for me.” Besides his tireless work ethics and intense focus, those who know him say Vadapalli is one of the most unpretentious, genuine people they have ever known, and if anyone can meet the huge challenges facing Alaska Communications it is he. The state’s

www.akbizmag.com • Alaska Business Monthly • April 2011


telecommunications industry is known as one of the most competitive in the country, especially considering the small population base. Where similar markets typically have two companies to choose from, three large providers inundate Alaska residents and businesses with incentives for switching to the competition. At the same time, it is no secret that Verizon Wireless is poised to enter the Alaska market with voice, broadband data and other wireless products and services.

Customer Focus

In the end, industry leaders agree, service is what dictates satisfaction, which comes down to adapting products to the market. Vadapalli’s experience in both technology and marketing is why he is expected to be able to grow the company despite the challenges facing him. While being aware of the competition is certainly critical, he understands focusing on what is best for the customer is more important than chasing the other guy. The best way to stay ahead, he says, is by making a steady and heavy investment in technology and innovation, which the company continues to do: over the past few years alone, it has invested hundreds of millions of dollars in technological infrastructure – a commitment that will not change. That, combined with customer service that sets the standard, is how he plans to keep the company ahead of the game. “He doesn’t view the competition as a zero-sum game,” Bob Kaufman, both a friend and professional affiliate says of Vadapalli. “He really takes the commitments Alaska Communications makes to customers very seriously and understands you don’t solve problems in business without short-term stresses. He took the job at a time when the wind is not blowing at his back – and he took it without hesitation.” One of his recent responses to the changing marketplace was his contribution to changing the Alaska Communications Systems (ACS) brand to Alaska Communications. When the original brand was developed about 10 years ago, he says, more than 75 percent of the company’s business came from providing traditional phone service. Today more than 50 percent of revenues come from wireless and enterprise data.

“There has been a significant shift in who we are and what we do in the market, in the products and services we sell, and how we make money,” he says. “It is important for us to communicate that we have evolved and grown from where we were 10 years ago and the new brand is a reflection of how we have changed.”

Committed Leader

While Vadapalli is the first one to talk about executing the company’s strategic choices, including “making the customer experience the highest quality they can get every day,” no less important is his commitment to enabling employees so the work force evolves as the business changes. “Taking care of our employees and our customers – there’s no magic behind this business approach,” he says pragmatically, and it all goes back to the lessons he learned in his professional experience before entering the corporate world. “It’s not about one department over another – it’s about the company and I’ve always kept that attitude.” Vadapalli’s golf game is similar to his realistic approach to business. Kaufman says, “He keeps the ball in the fairway – another indicator of his focused and consistent style, and the only way to score well in the game.” When he’s not working, he enjoys spending time with his wife, Prarthana, and son, Anirudh, a sophomore at Emory University who plans to go to law school, and his daughter Shruti who is an eighth grader at Golden View Middle School. He also enjoys reading, painting, sketching and taking annual family trips back to India. His first name Anand means joy or happiness, which immediately comes across in his demeanor. Although his success at such a young age is remarkable, when asked about what he attributes his accomplishments to, he says he doesn’t think of his consistent advancement as the motivator. “I care about quality and I love problem-solving,” he says. “And the most important thing is that I learn every single day. I build good relationships at work and I sustain them, and I’m fortunate to have the opportunities I’ve had so far.”  q

www.akbizmag.com • Alaska Business Monthly • April 2011

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A s s o c iat i o n s

By Tracy Barbour

World Trade Center Alaska

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orld Trade Center Alaska (WTCAK) focuses on helping Alaskans successfully compete for trade and investment in the global marketplace. The nonprofit organization represents a valuable resource for Alaska companies wanting to do business internationally, according to Executive Director Greg Wolf. WTCAK provides everything from one-on-one counseling and market research to valuable access to facilities and support in more than 300 cities around the world. It strives to give Alaska companies the information, tools and introduction to conduct business internationally. WTCAK is all about showing Alaska companies they can be local and global. “You can be an Alaska company and do business all over the world,” Wolf says. Founded in 1987, WTCAK has approximately 100 members. Companies make up the majority of the membership, with individuals comprising the rest. WTCAK’s members fall into three distinct categories. The largest group is companies already doing international business and interested in entering a new market. These businesses are often seeking insight into different distribution channels. The second-biggest segment is companies doing business in Alaska and/or the Lower 48 and are looking to find opportunities overseas. The third and smallest category represents service providers, such as banks and freight forwarders, who are seeking to do businesses overseas. While WTCAK is pleased to assist all of its members, perhaps the most rewarding group to work, Wolf says, are those who are exploring international opportunities for the first time. “It’s a whole new game for them,”

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Photo by Azimuth Adventure Photography www.azimuthadventure.com

Helping Alaska companies expand globally he says. “They don’t have any experience doing this yet.”

Helping Companies Expand Their Borders

WTCAK uses a variety of methods to assist Alaska businesses with their efforts to do international business. Trade missions are a prime example. Wolf says it’s essential for companies to get first-hand, ground-level knowledge when exploring opportunities overseas. Being able to meet with potential international customers face-to-face can be more advantageous than talking with people over the phone or conducting research over the Internet. “It gives you a better understanding to travel to that market and see what’s going on the ground,” Wolf said. “Seeing is believing. You really need to get on the ground in China yourself.” That’s exactly what WTCAK’s is helping its members do. The organization has taken two trade missions to China. Mission participants have been able to learn about potential business opportunities, gain a better understanding of the country’s economic and business climates and receive advice on how to navigate those markets. Over the years, exports from Alaska to China have increased from $100 million to about $800 million, Wolf says. “We’ve done a lot in terms of providing information and assistance to Alaskans who want to do business in China.” China is Alaska’s No. 2 trade partner. In 2009, it received 18 percent of the state’s imports, according to a July 2010 report prepared for WTCAK by Anchorage-based consulting firm Northern Economics, “The Economic Impacts of International Trade Exports on the Alaskan Economy.” The report indicates Japan received 30 percent of Alaska’s

World Trade Center Alaska Executive Director Greg Wolf.

exports; South Korea received 14 percent; and Canada received 10 percent in 2009. Alaska ranked sixth in the nation by value of exports on a per-capita basis, exporting the equivalent of $4,660 goods per person that year. The state’s exports to overseas markets totaled $3.3 billion in 2009. The primary goods being exported from Alaska are seafood, energy, forest products, and precious metals and minerals.

Exploring for New Opportunities

Currently, WTCAK has trade development programs on China, Japan, Korea, Canada and an area called “emerging markets/new customer programs.” While the organization is continuing to work hard on developing Alaska’s traditional overseas markets, it is also looking to find new opportunities, Wolf says. Southeast Asia is an emerging hot spot – particularly Singapore. Singapore is a small market, but it has a rapidly expanding middle class with

www.akbizmag.com • Alaska Business Monthly • April 2011


an 18 percent annual growth rate, according to Wolf. A major factor driving the trend is the growth of the country’s middle class, he says. This segment of the population has more money to spend and higher expectations. “Many people are moving up the economic food chain,” Wolf said. “All of that requires energy, natural resources and food.” For WTCAK, the challenge is to match Alaska goods and services with the needs of Singapore’s burgeoning middle class. The organization is conscientiously working to leverage this valuable opportunity. Several months ago, WTCAK members took a trade mission to Southeast Asia. The bulk of their time was spent in Singapore and New Delhi, with a brief stop in Taipei. Wolf says India isn’t a big customer for Alaska – yet – but it is growing impressively. Some of the growth characteristics and needs India has are very similar to those of China. WTCAK’s goal during the recent trade mission was to not only discover what types of goods India needs, but also to discuss what Alaska can provide. “There is a lot more follow-up work to do,” Wolf said. “It’s sort of cutting-edge trade development work and a start to our growth with trade with India.”

and do it well, you can probably do it somewhere else,” Wolf says. From an industry-based perspective, WTCAK is concerned about the responsible development of Alaska’s natural resources. Wolf says Alaska can have development and maintain the integrity and beauty of the state. To address this vital issue, WTCAK is working to highlight opportunities for Alaskans to sell natural resources. “It’s important for the decision makers to know there are markets in the U.S. and overseas for what Alaska has here,”

Wolf said. “The world needs what Alaskans have to offer and, increasingly, the world has money to buy those things.” WTCAK is constantly striving to improve the quantity and quality of the services it provides to its members. Its prevailing goal is to do more for the Alaskan business community. In the future, the organization would like to see its membership continue to grow. “As more companies see opportunities overseas, we think that will lead to an expansion of our memberq ship,” Wolf says. 

Service-Sector Exports, a Growing Field

WTCAK is also increasing its efforts to help service-sector companies capitalize on international business. The recent trip to Southeast Asia, for instance, featured companies offering construction engineering, architectural and environmental services. When most people think about Alaska exports, they think of coal, seafood or natural gas. However, an increasing number of Alaska companies with world-class expertise in the service sector are reaching out to customers overseas. WTCAK doesn’t have exact figures on Alaska’s servicesector exports, Wolf says, but he estimates service-sector exports to be about $750 million annually. And that’s probably on the low end, he says. Service-sector exports is a growing field enabling Alaska companies to offer their extensive expertise outside the state. “If you can do work in Alaska

The value of

innovation

The wonder of technology is that in the blink of an eye, the tools of an industry can change. One new innovation can revolutionize how we approach oil development. At ConocoPhillips, we are leaders in developing new technologies in Alaska. It’s helped us reach more oil with a smaller footprint. That’s good for the environment. That’s good for Alaska. And that’s the value of innovation.

conocophillipsalaska.com

www.akbizmag.com • Alaska Business Monthly • April 2011

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FISHERIES

Southeast Alaska Mariculture Geoduck divers create new industry By Nicole A. Bonham Colby

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fter a near 14-year evolution of dogged efforts by a handful of Southeastern divers to create a farmed-geoduck industry in Alaska, last year proved particularly significant for the venture. It marked the first occasion in Alaska history that geoducks – giant clams indigenous to the chilly waters of Washington state, British Columbia and the Panhandle – were grown to maturity on local farms, then harvested and shipped from the state to Asian markets. According to Kurtis R. Morin, the Ward Cove-based entrepreneur and long-time impetus behind the concept of developing a farmed-geoduck niche in the 49th state, the year ahead may prove to be the best yet for the intrepid group of commercial divers who make their living at the bottom of the sea.

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Photos by Nicole Bonham Colby

Turbulent Waters

Just like the extreme ebb and flow of the waters of the island archipelago where the divers farm their clams, the chronology of the industry itself in Alaska has not been smooth. First, there was the challenge of simply working with State regulators to develop from scratch a permit system for such a geoduckmariculture industry. That started at the most basic level: addressing the concerns and requirements of a multitude of State and federal agencies to develop a coherent application, permit and regulation process. Once that milestone was met, there was conflict from the existing commercial dive-harvest fishery regarding impact to wild-stock geoducks. The primary conflict – how to reconcile any harvest of wild-stock clams from the permitted farmed sites – was somewhat resolved through litigation and after

Kurtis Morin, co-owner of Alaska Shellfish, displays juvenile geoduck clams at his micro-nursery at Ward Cove. Once the clams reach approximately 12 millimeters, they will be transferred to State-permitted farm sites in the Ketchikan vicinity.

the State opened the farmed sites to multiple, initial commercial harvests. Through amended regulations, the State then developed a system for addressing subsequent wild stock that may be collected in farmed harvest returns.

However, according to Morin and others, the greatest challenge ahead for those few remaining divers who have lasted the decade-long development period, is that of availability of seed. In the end, it is a logical challenge of

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finding sufficient amounts of clam seed that will determine the success of this fledging, mariculture niche.

Seed Sowing

As Alaska geoduck farmers are prohibited from importing seed from outside the state, a single source – the Alutiiq Pride Shellfish Hatchery in Seward – currently supplies all geoduck seed. Due to lack of availability from the single source, Morin did not have seed to plant in 2009, and only some 1,500 count for last year. While the concept of farmed geoducks elsewhere in the United States and Canada has been around since the 1970s, the Alaska industry is young and has yet to resolve such logistical challenges. Operating as Alaska Shellfish, coowners Kurtis Morin and brother Ryan Morin receive their seed from the hatchery in two sizes: that which is approximately 3 millimeters in size, and also larger-sized baby geoduck clams that simply require a short period of acclimation before planting at the farm sites. The life of a geoduck farmer is year-round, but largely starts in the early spring, with the ordering and arrival of seed – if available. The miniature, 3 millimeter geoduck seed gets planted in custom-designed, irrigated trays at a floating micro-nursery at Air-Marine Harbor, Ward Cove. Once the clams grow to approximately 12 millimeters – about a year later – the farmers transfer the juvenile clams to farm sites leased from the State and scattered across southern Southeast. The farmers sprinkle the clam seed onto mesh that is pinned to the ocean floor. The divers return at least monthly to remove kelp and eventually – three or four months later – to remove the mesh, which is returned ashore, washed and reused for the next planting. During the summer months, the divers check their sites regularly, monitoring for predators such as sun stars. In the fall, the water temperature cools and the clams quit digging and largely remain stationary for the winter. Autumn is also the time when many of the geoduck farmers participate in the commercial-harvest dive fisheries for sea cucumbers and wild-stock geoducks. After meeting annual State reporting requirements and taking a brief rest, the farmers start

their planting and dive cycle again in the spring. As of 2010, the State leased some 25 intertidal and subtidal farm sites to farmers in Southeast, including the Morin brothers’ own four sites near Ketchikan that total approximately 27 acres. For the next six to eight years, the farmers carefully tend to their waterborne crop, reporting progress to the State each year, monitoring predation, and surviving seas and storms to generally hope for the best. That hope was realized last year when the Morins

and fellow diver Tyler Zaugg carried Alaska’s first crop of mature, farmed geoducks onto the Trident/Silver Lining Seafoods dock in Ketchikan in August. The collection of clams weighed in at between 1.6 and two pounds and ranged from 5 to 6 years old.

Seafloor to Table

The primary market for geoducks – farmed and wild stock, originating from Alaska and elsewhere – remains China, although the giant clam is available on menus throughout Asia.

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Geoduck is considered a delicacy and can sell at the table for up to $30 per pound. Served raw, sautéed or stewed, the meaty clam siphon is prized by enthusiasts for its crunchy texture and unique savory flavor. The Alaska-farmed geoduck has the advantage of being mostly meat, and less shell than its wild-stock variety. After being planted in a largely safe and optimum environment at the permit sites, the farmed geoduck spends its time growing, instead of producing shell, Kevin Morin says.

The result is a top-quality product for a ready market. As for freshness of the product shipped live to market, the Alaska Shellfish geoducks can go from harvest to China in the same day. By ensuring the clams get to the processing plant by 4 a.m., the product can make its flight to China within the same 24hour period. It’s a market advantage that has not gone unnoticed by Asian buyers. Kevin Morin says he currently has more requests for his product than supply allows.

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Marketable Model

It costs the Morins and their colleagues approximately 50 cents to grow a farmed geoduck from seed to harvestable size. Given that the growers net between $8 and $12 per pound for the same clam, the obvious question is: why are others not taking advantage of this apparently lucrative, marketable industry niche? First, there is the upfront investment. Kevin Morin estimates he and his investors have spent nearly $500,000 to date to realize his aspirations of a successful geoduck mariculture industry. Last year’s first harvest also marked the first actual return-on-investment for Alaska Shellfish and its private backers since the Morins started work on the concept more than a decade ago. The second and more critical factor remains the limited availability of seed. However, the latter may get a boost from collaboration between the growers, organized as Alaska Shellfish Cooperative, and a mariculture research and education facility at the OceansAlaska Marine Science Center in Ketchikan. The center broke ground in November and will host a variety of methods of mariculture development, training, and applied research and technology transfer – including a geoduck nursery and oyster farmer entry program. When asked if it’s difficult some mornings to don the dive gear and prepare for another day spent weighted down, hours underwater, tending to his silent crop, Kevin Morin grins. Alaska Business Monthly first profiled the former U.S. Navy navigator, longtime commercial diver and native Southeaster in September 2004 (“Clam Farms Blossom in Southeast”). At that time, he had already invested eight years of labor, capital and planning in his vision to create a small-business model from which local divers could earn a reasonable portion of a year’s living from an abundant, local natural resource. As other traditional Southeast industries faced their twilight, Kevin Morin suggested farming geoducks offered an alternative job source, and posed the ultimate in “clean industry” by cultivating an already prodigious native species of Southeast clam.

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“I saw this as an opportunity to take an industry that was really underused and create an industry that would create a lot of jobs,” he said at the time. “And that’s still what I’m trying to do. I want to be able to look back and say, ‘Hey, I helped make this industry happen.’” Six years later, although a bit battered from the fight, Kevin Morin nonetheless projects the same entrepreneurial enthusiasm about the local potential for value-added production methods and peripheral jobs, improved market flow to his ready supply of China-based buyers, and even his own technological innovations to maximize a diver’s time underwater. As Southeast Alaska musters its ingenuity and natural- and people-resources to carry itself forward into this new century, Kevin Morin and his small group of diver colleagues are its local sons, daughters and ambassadors – each armed with ambitious dreams, technical expertise, proven tenacity and multi-generational ties to the region. For them, Southeast’s future lies in its ability to cultivate a clam with a funny name from a tiny industry niche to its giant potential.  q

Kurt Morin displays the style of water hose that divers use to uncover geoducks for harvest on the ocean floor. A pump onboard the boat sends sea water down the 2-inch, 300-foot hose to the nozzle. The diver uses such water pressure to dig the clams from the sea floor, as they can be buried up to six feet deep in sand.

www.akbizmag.com • Alaska Business Monthly • April 2011

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SMALL BUSINESS FEATURE

Paris Bakery and Café

Photo by Jeff Johnson

Owner/head chef Antoine Amouret with a few of his prized French pastries.

French cooking with a passion brings touch of class to east side of town By Stephanie Jaeger

I

n June 2009, Antoine Amouret came to Anchorage as a French tourist. While exploring the city, he discovered the Paris Bakery and Café and introduced himself to the previous owner, Michel Bieri, a fellow Frenchman and chef. Bieri said he was looking for a new generation of pastry chef and asked Amouret to work for him. Amouret offered to buy the business. After receiving a work visa and completing the necessary paperwork to purchase a business in the United States, Amouret flew back to Anchorage in April 2010. He immediately bought the bakery and

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café, and became its head chef, baker and manager. For the past 10 months, Amouret’s work at the Paris Bakery and Café has focused on improving and expanding the business. Located in Muldoon Square at 500 Muldoon Road in northeast Anchorage between a used appliance store and a laundromat, the Paris Bakery and Café is in an unlikely place to look for a French restaurant. The restaurant has 15 tables and booths, and seats about 50 people. The bistro-café offers table service and serves anything from a cup of coffee to leisurely meals. Hints of

French culture include quiet French music playing in the background, classical-appearing black, brown and white prints on the walls and an edging of Parisian city buildings at the top of the walls surrounding the dining area. The Paris Bakery and Café serves a variety of foods. The lunch menu offers a mixture of American, Italian and French food, including hamburgers, cheeseburgers, Reuben sandwiches, French dip and other American sandwiches as well as salads, quiche, fettuccini and ravioli. All entrees are served with a choice of soup, salad or French fries.

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The dinner menu offers all the dishes on the lunch menu plus calamari, zucchini, chicken and escargot appetizers, dinner crepes with seafood and chicken, medallion of beef, scampi Bieri, halibut Napoleon, veal and chicken marsala, citrus ginger scallops, New York steak and Dijon pork tenderloin. The café offers a variety of white, red, blush and sparkling wines. Domestic and imported beers are also available. The bakery sells a variety of breads including French baguettes, whole wheat bread, seven-grain bread and brioches. Some of the pastries available include cake made with coffee butter cream layered between almond cake and covered with chocolate ganache; fruit tarts; cake made with chocolate mousse, banana mousse and coffee and vanilla flavoring; mixed berry, almandine, peach and lemon tarts; chocolate éclairs; croissants both plain and containing various fillings including chocolate. The pastries available vary from day to day and during the course of any day. “In France we are trained to be creative,” Amouret says. “Making food, cooking, baking are my passion. It is not just for making money or baking bread.” In France you cannot become a chef without a degree. He completed a two-year apprenticeship there where he worked for two weeks learning to cook and the next two weeks training to run a business and supervise employees. He learned the theory and science behind each type of cake and dough. “Apprentices learn from their mistakes and how to vary their cooking depending on the humidity and other environmental conditions,” Amouret added. “They learn to add more water when the humidity is low or to cook breads for varying lengths of time depending on the temperature of the water used to start the dough.” These lessons have been particularly helpful in the cold, dry climate of Alaska. Amouret is also trying to expand the catering side of his business. An orange and white van transports his food to and from corporations in Anchorage for breakfast and lunch meetings. His current catering customers include

Alaska Native corporations, nonprofits and oil companies. Catering is one of the activities he especially enjoys. He specializes in what he calls “decadent petit fours,” which include savory two to three bite-size appetizer petit fours and sweet two to three bite-size dessert petit fours. A complete range of catering serves is also available. Both French and non-French customers patronize the business. Many of the Paris Bakery and Café’s customers come from nearby Joint Base Elmendorf-Richardson and the east side of the city. Several people come from as far away as Eagle River and south Anchorage including a group of women who get together weekly for lunch. They often meet at the café. “The staff at the café is always friendly and provides good service,” says Doris Bordine of Eagle River, a regular member of the group. “The food is excellent and Amouret often comes out personally to ask how things are and if we need anything.” Amouret says he has had little staff turnover since he took over the business. He personally does most of the cooking and especially likes baking pastries and breads. “People come here for quality,” Amouret says. “They try it out and then tell their friends and then their friends come.” Amouret added weekend breakfast or brunch Nov. 1, 2010, Saturday from 8 a.m. to noon and Sunday from 10 a.m. to 1 p.m. The breakfast menu includes eggs Benedict, several types of omelets, and the traditional ham, bacon and eggs. Lunch is served Sunday from 1 p.m. to 4 p.m., and Monday through Friday, from 11 a.m. to 3 p.m.; dinner is served Tuesday through Saturday, from 5 p.m. to 9 p.m.; and the bakery opens at 8 a.m. every day. The café also features special dinners on the first Tuesday of each month. These six-course dinners showcase traditional entrees from one region of France. Dishes from Nice were featured in February. Additionally, the bakery and restaurant is beginning a tradition of offering special meals for certain holidays such as Valentine’s Day. All dishes are cooked using specially shopped local produce, fresh seafood, meats and poultry.  q

www.akbizmag.com • Alaska Business Monthly • April 2011

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EDUCATION

Alaska Colleges and Universities Photo by Ryan Cortes/Courtesy of University of Alaska Southeast

Putting higher education within reach for Alaskans By Louise Freeman

University of Alaska Southeast students receive safety and underground mining training through a partnership between UAS, Mine and Petroleum Training Services, the Alaska Department of Labor, and the mining industry.

T

hrough its far-flung network of colleges and outreach centers, serving communities from Kivalina to Ketchikan, Alaska’s higher education system has put a college education within reach for most potential students throughout the state, no matter where they live. From the unique twoyear Ilisagvik College in Barrow, which was founded to provide an education based on the cultural heritage, language and traditions of the Iñupiat, to the University of Alaska Southeast campus in Ketchikan, which offers classes in Tlingit arts and culture, Alaska’s extensive higher education system celebrates the diversity of the state. At the heart of the higher education system in Alaska is the large, far-reaching University of Alaska system, which is divided into three main branches: University of Alaska Fairbanks (UAF), University of Alaska Anchorage (UAA) and University of Alaska Southeast (UAS). Each branch of the university has its own unique strengths, drawing students from throughout the state.

Flagship Campus

Alaska’s flagship university campus is centrally located in Fairbanks, earning it the designation of “America’s Arctic

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University.” UAF is uniquely situated to provide a base for research into Arctic and sub-Arctic studies. “Our climate-change researchers are recognized worldwide. Our undergraduate and graduate students get to work alongside them and that is incredibly exciting,” said Marmian Grimes, UAF spokeswoman. Research and teaching are top priorities at the UAF campus, with 90 percent of research dollars in the UA system going to UAF. The University of Alaska Fairbanks has more selective criteria for admission than the other UA campuses, which have an open admissions policy; however, UAF does have mechanisms in place, such as admitting students to a “pre-major” to assist students who do not meet the regular admissions requirements. The engineering program is especially strong at UAF, accounting for 15 percent of the baccalaureate degrees awarded in 2010. The university offers a wide range of educational opportunities for students, from one-year certificate programs in its Community and Technical College to doctoral studies. The technical college, Grimes said, “is very responsive to industry. We see a need

in industry and we jump on it and start a program to fill that need for what employers say they want.” The most popular certificates are in the field of health professions, accounting for 48 percent of the certificates awarded last year. Until recently, UAF was the only institution in the state to award doctoral degrees, and their flourishing doctoral program still accounts for the largest share of doctorates awarded in Alaska. The University of Alaska Fairbanks offers scores of courses to students in remote areas of Alaska via the College of Rural and Community Development, a community college extension with campuses in Kotzebue, Nome, Bethel and Dillingham, as well as centers in six villages in the Interior and the Aleutians. In total, the college provides educational opportunities to students in 160 communities statewide. Most of the classes are offered through distance education, making uses of Internet-based and audio/video technology. Courses focus on work force education and lifelong learning, although Associate in Arts degrees are offered in many areas, as well as both baccalaureate and master’s degrees in rural development.

www.akbizmag.com • Alaska Business Monthly • April 2011


Most Students

The largest branch of the UA system is UA Anchorage and its community campuses, with 20,368 students, compared to UAF’s 11,034 students. The Anchorage campus is the largest within the UA system, with 15,662 students. “Our single strongest identity is in health-related areas,” said Dr. Michael Driscoll, provost and vice chancellor for academic affairs. “We’re the health university for the state.” The health sciences programs range from certificate programs taking less than a year such as phlebotomist and limited radiography, through Associate of Arts in Nursing, to a medical school operated in cooperation with the nationally recognized medical school at the University of Washington. Medical students in the WWAMI program spend one year in Anchorage, one year in Seattle and can spend the final two years in Anchorage. The WWAMI Medical Education Program involves medical education programs in Washington, Wyoming, Alaska, Montana and Idaho. For every 10 students Alaska sends to the program, seven or eight end up practicing in Alaska. “It is a great return on our investment,” Driscoll said. The nursing program is also especially strong, showing rapid growth over the last few years. The development of the nursing program was in direct response to the needs of the health care industry within the state. “We design our programs to match the needs of industry and government agencies. We get our students ready to walk in prepared to work in whatever their field,” Driscoll said. The majority of students at UAA come from the Anchorage area, but the university strives to ensure that rural – especially Alaska Native – students are successful, with programs such as the Alaska Native Science and Engineering Program (ANSEP). A recruitment, retention and mentoring program, ANSEP works with students from junior high through doctoral level, nurturing them as they develop academic skills in the fields of science, technology, engineering and math. Another area in which UAA is especially strong is psychology, from the baccalaureate level to the doctoral

level. UAA offers a clinical-community psychology doctoral program in cooperation with UAF, with a focus on rural Alaska. When they are finished, students receive their degree from UAF. “A significant portion of the students are Alaska Native or from rural communities and want to give back to their communities when they are done,” Driscoll said. One new trend Driscoll has noticed at UAA is more traditional 18-year-old freshmen are deciding to attend college in-state. “With the economic downturn, they recognize they can get what they need at UAA and not have to go Outside,” Driscoll said. Many students at UAA have been recognized nationally for their outstanding work. UAA was recently named among the 2010-2011 leading producers of U.S. Fulbright Students by the Fulbright Program, the U.S. government’s prestigious international educational exchange program. The UAA system has four branch campuses: Eagle River- Chugiak, Kenai Peninsula, Kodiak and Prince William Sound Community College (PWSCC). Each campus has unique programs not offered elsewhere, such as the associate degrees in corrections and digital art, both available through Kenai Peninsula College. The main campus of PWSCC is in Valdez, and the college has geared some of their programs to put graduates to work in the oil industry. One popular degree is Associate of Applied Science in Industrial Technology; within that major, students can gear their studies toward oil spill response, safety management or millwright. “Our strength is our size. We’re small – every student counts,” said Douglas A. DeSorcie, president of PWSCC. “We can keep in touch with our students to make sure they have all the tools they need to succeed. They need to apply themselves, but if they don’t we intervene early and say, “Why aren’t you going to class?” The PWSCC student services staff provides the needed support to students either in the classroom or to those who are taking distance courses. Seventyfive percent of the courses at PWSCC have a distance-learning component.

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www.akbizmag.com • Alaska Business Monthly • April 2011

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Largest Private University

Alaska’s largest private university, Alaska Pacific University, also takes advantage of the state’s natural environment to provide active, hands-on learning. Their emphasis is on experiential learning in the real world, often having the students work on projects that are relevant to the community. The college has students doing research on the Eklutna Glacier for Anchorage Municipal Light and Power so it could make projections about the Municipality of Anchorage’s drinking water supply. Students also monitor beluga whales coming in and out of the port for the Port of Anchorage. APU’s strong commitment to environmental education is reflected in

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Photo courtesy of Alaska Pacific University

Southeast Campuses

The University of Alaska Southeast (UAS) consists of three campuses – Juneau, Sitka, and Ketchikan. Business administration is the most popular major for baccalaureate students at UAS. At the master’s degree level, the largest program is the Master of Education, which is designed to develop the classroom skills of teachers currently practicing in elementary and secondary schools. Career and technical education is an area of strength that UAS plans to develop further in coming years. “One of the exciting things in career education is that we are developing a new center in mine training because mining is important to Southeast Alaska now with new possibilities opening up in mining. We will expand our offerings in mine training and mine safety, emphasizing underground mining,” said Dr. Richard Caulfield, provost. Another program the university highlights is their legislative internship program. Students from all three campuses work in Alaska’s capital. “A number of our graduates have gone on to work in government or take on leadership positions across the state, using the insight they’ve gained into how decisions are made for Alaska’s future,” Caulfield said. Other strong programs at UAS are environmental studies and marine biology. These majors “really build on our assets in Southeast Alaska. We have undergraduates doing research on glaciers and working in tidelands,” Caulfield said.

An Alaska Pacific University psychology major in Africa, working with the Malawi Children’s Village, combining community service with APU studies.

their participation in Eco-League – a partnership of small private liberal arts colleges around the country that share an environmental focus. These colleges develop curriculum together and offer student-exchange programs. Several APU students participate in the exchange program, going to colleges as far away as Vermont. With APU’s emphasis on active learning, students are encouraged to participate in programs that take them to sites around the world, where they can both learn and apply that learning in a real-life setting. Psychology majors are currently in Malawi, working with the Malawi Children’s Village, combining community service with APU’s counseling curriculum. The psychology program at APU is especially strong, and the college was recently approved for a doctoral program in psychology – the first doctoral program at APU. The private liberal arts college was founded as a Methodist university and today its Christian heritage is reflected in the “strong dose of ethics” the students receive throughout their studies, said Dr. Don Bantz, president.

Alaska’s Only Tribal College

Ilisagvik College is the first and only federally recognized tribal college in Alaska. Ilisagvik means “a place to learn” in the Inupiaq Eskimo language.

The college is designed primarily to meet the needs of North Slope Borough residents, but as a public college, it is open to anyone. Students from other parts of the state are welcome. “We even have students from the Lower 48,” said Pearl Brower, dean of students and institutional development. The college offers certificates in areas such as wastewater treatment, carpentry and plumbing, as well as several Associate in Arts and Associate in Applied Science degrees, with a particular emphasis on business, Inupiaq studies and allied health.

Smaller Schools

Two of the smaller private colleges in Alaska are Alaska Bible College in Glennallen, with 55 students, and Wayland Baptist University, with 500 students at four sites in Anchorage and additional students at two sites in Fairbanks. Most of Wayland’s baccalaureate students are in the military or working full-time and choose to pursue a Bachelor of Applied Science degree, with an emphasis in their area of military training or profession, such as business administration or economics. The most popular graduate degree is Master of Management. Wayland Baptist University is headquartered in Plainview, Texas, and has 13 campuses in the United States and one in Kenya.  q

www.akbizmag.com • Alaska Business Monthly • April 2011


“Through the RPM Lab we manufacture our own prototypes instead of subcontracting our designs out to the Lower 48. It used to take weeks to complete, but now we can fix our mistakes immediately, expediting the design process.” --Jens Jensen, Mechanical Engineering student

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UAA SCHOOL OF ENGINEERING Applied Engineering and Innovative Design The School of Engineering provides hands-on learning through its newly created Rapid Prototype and Manufacturing (RPM) Lab. The Lab allows students to design and manufacture prototypes and efficiently test and improve models. With applications ranging from oil and gas development to the health and medical fields, the Lab is helping create a new generation of innovators and designers. Lab equipment in Phase I of the RPM Lab was made possible through BP Exploration Alaska Inc.’s generous donations to the School of Engineering.

Engineering Alaska’s Future Today

www.uaa.alaska.edu/schoolofengineering • (907) 786-1900 www.akbizmag.com • Alaska Business Monthly • April 2011

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REAL ESTATE

Anchorage Commercial Property Looking Good

© 2011 Ken Graham Photography.com

Tikahtnu Commons

Some withdrawal, but overall Alaska holds strong By Jack E. Phelps

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n a recent afternoon, Grace Mischenko pulled her red suburban into the parking lot at Tikahtnu Commons, the new 950,000-square-foot shopping complex off Muldoon Road in northeast Anchorage. The mother of seven from Wasilla says she likes having a shopping choice near the north end of town. “It’s convenience,” she says, “having Best Buy, Kohl’s and Target all together just off the highway coming into town. The guys can go their way and I can go mine. I like shopping at Kohl’s, and the Target is nice too.” Her teenage boys like Best Buy and the Game Stop. “We also like the movie theater,” Mischenko says, “we’ve already gone to the movies there a couple times.”

Yes! Success!

Tikahtnu Commons is one of the recent success stories in commercial lease space in the Anchorage Bowl. Located on 95 acres of land acquired from the federal surplus property program by Cook Inlet Region’s real estate development group, the $100 million project broke ground in 2007. It has attracted major national

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retailers, including Kohl’s, which opened its first-ever Alaska location at the Commons in April 2009. Just six months earlier, Target, America’s second-largest retail chain, opened two stores in Alaska, one of them at Tikahtnu Commons. “Retail lease space in Anchorage is doing well,” says Jan Sieberts, a longtime expert in Alaska commercial lending, adding: “2011 is going to be a good year for the commercial market. It could be better if the private sector could get moving again. I don’t see a lot of new private construction starting up this year. Most of the construction we see is public construction.”

Private Down/Expansions Up

Sieberts cites the “Gulf of Mexico effect” for some of the slowdown in private-construction spending. The regulatory uncertainty surrounding new development in Alaska’s oil fields is having a negative effect on privateconstruction spending, Sieberts says. Expansion of existing retail space is also a positive factor in the overall commercial space picture. Wal-Mart is adding nearly 55,000 square feet to its existing store in midtown. Kendall

Toyota is expanding its automotive retail center on the Old Seward Highway by 80,000 square feet at a cost of approximately $20 million. The project is expected to be finished before summer 2011.

Some in Survival Mode

Two shopping centers in northeast Anchorage have been struggling. Glenn Square in Mountain View, which began construction about the same time as Tikahtnu Commons, has been disappointing. Vacancy rates are unsatisfactory and the parking lot is rarely full. The older Northway Mall, just across Veteran’s Memorial Highway, is likewise struggling, with less than 30 percent of the space under lease. Red Robin has recently pulled out, as have GAP and Banana Republic. Sam’s Club, which has anchored the east end of the mall for decades, is preparing to relocate to Tikahtnu Commons. Plans are under way to turn Northway Mall into an outlet center, but financing and lease agreement issues have slowed the process, according to David Irwin, of Irwin Development Group.

www.akbizmag.com • Alaska Business Monthly • April 2011


Retail ‘Fine’

Nonetheless, Sieberts and other local experts remain optimistic. “Retail is fine, office space is relatively stable and the little strip malls seem to be doing well,” Sieberts says. In a recent forecast for the Building Owners and Managers Association (BOMA), Irwin demonstrated that as of last November, retail sales were up in every major category except drug stores, compared to the same period one year earlier. Average monthly change over the previous 12 months showed the same trend. In addition, the Alaska Department of Labor expects a slight upward movement in employment for 2011. This bodes well for continued growth in available services, including new retail lease space. No one expects the retail building boom of the previous five years to continue in Anchorage, however.

According to Irwin, nearly 1.57 million square feet were added to the base in the 2005-2010 period, and more than 1 million square feet in the five years before that. The forecast for the next five years is less than 1 million square feet. Irwin believes, however, that growth may accelerate in other parts of the state, such as Wasilla and Fairbanks, even as it slows in Anchorage. Sportsman’s Warehouse, for example, plans to open a new, 46,000-square-foot location in Soldotna during the first quarter of 2011. Cabela’s is looking at Fairbanks as well as Anchorage, for opening its first Alaska stores.

Office Space Tight

In the category of office space, the story is similar. JL Properties has been developing the Centerpoint Drive location, between Arctic Boulevard and C Street in midtown, for the past decade. The Arctic

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Slope Regional Corp.’s (ASRC) headquarters building on the corner of 40th Avenue and C Street, was completed and occupied in 2002. The 10-story building contains 210,000 square feet of Class A office space and is under a 20-year lease to ASRC. Since that time, additional office buildings have been added to the complex, including the five-story Centerpoint Financial Center (2006), the 14-story JL Tower (2008) and the eight-story Centerpoint West (2010). These three buildings added a combined 600,000 square feet of new Class A office space to the city. Overall, office lease space in Anchorage is relatively tight. According to Theodore Jensen, of Reliant Advisory Services, the national vacancy rate is 17 percent, with Detroit and Phoenix leading the pace at nearly 30 percent and 25 percent, respectively; in Anchorage it is only 6.6 percent for Class A space. Combining the figures for Class A and B, the rate is slightly over 7 percent. “The vacancy rate on Class A space is between 5 percent and 7 percent in the entire town,” Sieberts said. “It’s a little higher in the B and C classes, but we’re still ahead of most of the rest of the country.” As Jensen puts it, this “office vacancy rate is still considered (to be) very healthy.” There are very few new office buildings expected to be completed in 2011. The largest is the 40,000-square-foot project in southwest Anchorage, off C Street near Klatt Road, under construction by CIRI. The good news is that this project, for which Sieberts’ Washington Capital Management Inc. arranged the financing, is 100 percent pre-leased, according to CIRI officials. This is the only new office building to come on line this year in south Anchorage. The next largest new structure is a 9,000-square-foot building in the downtown area. More than 900,000 square feet of new office space is in the planning stage around town, according to Jensen, but most of these are on hold due to lack of pre-leasing agreements.

Industrial Weak

The final major category of leased commercial space is the industrial sector. Experts believe this to be

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© 2011 Ken Graham Photography.com

JL Tower

the weakest segment. The average industrial lease listings were nearly 40 percent higher in 2010, than they were at the end of 2003. According to Brandon Walker, commercial sales associate at Bond, Stephens and Johnson, this can be attributed to obsolescence of existing space. Factors such as lack of access to three-phase power, inadequate ceiling heights and lighting and docking problems contribute heavily to the problem. Many Anchorage warehouse facilities were constructed before 53-foot semitrailers were common. They simply do not provide adequate room for maneuvering trucks at the dock. The availability of suitable land and the price of what is available, combined with the cost of construction make new investments in industrial lease space less likely over the next few years, experts say. The combined cost will run approximately $225 per square foot, according to Walker’s estimates. Moreover, the Municipality of Anchorage has zoning restrictions in

place that could further impede new warehousing space. Historically, a lot of the goods available to consumers are already warehoused in Seattle and Tacoma and shipped to Alaska on an as-needed basis. Sieberts believes this trend will continue, given the difficulties faced by those who would like to increase the supply of industrial lease space in the Anchorage Bowl. “It’s just too expensive right now to expand the available industrial lease space in Anchorage,” he says. In summary, it can safely be said that the commercial lease space sector of Alaska’s economy is holding up well. Compared to the rest of America, Alaska, and particularly Anchorage, has it pretty good. Only time will tell how long this will continue, or whether it will improve. A great deal depends on whether several new oil prospects and opportunities develop and on how successful the state is in diversifying its basic economy. But for now the sector continues to be a bright spot in Alaska’s economic future.  q

www.akbizmag.com • Alaska Business Monthly • April 2011


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www.akbizmag.com • Alaska Business Monthly • April 2011


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www.akbizmag.com • Alaska Business Monthly • April 2011

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NATIVE BUSINESS

2011 ©Jim Lopes

Truck crossing the Canada-United States border.

Trucking through Canada Cross-border advantages for Alaska Natives By Darren Prokop

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laska Natives are a proud people whose culture is woven into the fabric of the state. Alaska Native corporations are a unique model for business and economic development. As such, Alaska Natives have a relationship with the federal government quite different from the system of reservations found in other states. The University of Alaska Anchorage has developed special outreach programs to recruit Alaska Natives into the study of a wide range of subjects in the physical sciences and the humanities.

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But there is another, though much less known, advantage, which Alaska Natives have and it lies in the area of cross-border trucking. Because of Alaska’s location, sparse and dispersed population, resource exports and manufactured imports, it is highly dependent on cost-effective and efficient transportation. Distance, weather and limited infrastructure make shipping costs higher than in the rest of the United States. Opportunities to systematically lower operational costs are welcome by all shippers

and carriers. There are transportation opportunities for Alaska Natives and the trucking firms that might hire them. First, some background. The United States runs a trade deficit of around $700 billion. The value of the goods and services we import greatly exceeds the value of our exports. In merchandise trade, we import $340 billion from Canada while sending it only $260 billion – an $80 billion deficit. However, Alaska bucks the trend with a $40 million trade surplus – $520 million worth of exports to

www.akbizmag.com • Alaska Business Monthly • April 2011


Canada as against $480 million worth of imports. In fact, Canada is the state’s fourth largest export market, after Japan, China and South Korea. There are two border crossings into Alaska from the Yukon and three from British Columbia. On an annual basis, about 24,000 trucks enter and exit the state; and out of these 76 percent are hauling loaded containers. While these trade flows represent less than 1 percent of total U.S.-Canada cross-border trucking activity, these trade lanes offer up an opportunity for Alaska Natives. This arises because of the special legal status Alaska Natives enjoy with respect to a transport activity known as cabotage.

Cabotage

What is cabotage? Simply put it is the transport of freight (or passengers) from one point to another on domestic territory by a foreign conveyance and/or foreign operator. It is usually an illegal activity except under circumstances agreed to by the foreign and domestic governments involved. It should be noted that while the U.S. and Canada

have maintained a free trade agreement for more than 20 years now, crossborder transportation has, by and large, been subject to the same set of trade restrictions. Note that free trade typically involves removing trade tariffs on goods; it rarely covers the non-tariff barriers, which affect transportation. What complicates matters is that each particular mode of transport (i.e., air, truck, rail and water vessel) is subject to different degrees of cabotage restrictions. Furthermore, the U.S. and Canada do not maintain uniform laws in these areas. Thus, transportation planners in the U.S. or Canada who wish to undertake cabotage in the other country need to be aware of two different regulatory environments. For this reason, cabotage activity is rare in the U.S. and Canada; but, when it is legally practiced, it is a benefit to the carrier and its shipper customers. Why is legal cabotage beneficial to a carrier? It is all about filling vehicle capacity. Adding more cargo generates a further source of revenue. Consider an Alaska-based truck traveling the Alaska Highway. The route could be

an export-import run into and out of Canada, or a run to the Lower 48 and back. In either case, when the vehicle has excess capacity while traveling within Canada, filling up the truck with a domestic (i.e., Canadian) load helps to cover all operational costs associated with the round-trip. In effect, arranging for and adding more backhaul freight while returning to Alaska would actually allow the carrier to lower the fronthaul freight rate charged to the Alaska-based shipper. In other words, the extra competition generated by an Alaska truck competing head-to-head for Canadian freight is beneficial to the Alaska-based carrier, the Alaska-based shipper and any Canada-based shippers using the new service. So, how can Alaska trucking companies do this? Basically, they need to have drivers who are legally eligible to engage in cabotage in Canada. It turns out that out of all modes of transport trucking has the most flexible cabotage regulations in the U.S. and Canada. But this flexibility extends just to the vehicles and not the drivers. Why? It is because the regulators who interpret

www.akbizmag.com • Alaska Business Monthly • April 2011

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the Customs Act governing vehicles are different from those who interpret the Immigration Act governing drivers. This is understandable when noting how countries tend to protect their domestic labor from foreign competition more so than they do their domestic goods. Consider the regulations applicable to the vehicle. The cabotage freight on a vehicle, as part of an export or import run, must be less than 30 percent of the value and volume of the international freight on board. Think of a return trip along the Alaska Highway with import freight from Calgary to Fairbanks being topped up along the way with strictly domestic freight from Edmonton to Whitehorse. Of course, the vehicle could contain up to 100 percent cabotage freight, but this must be part of a repositioning move whereby an international load has been dropped off and another is being picked up some distance elsewhere along or near the original route. In this case, think of the return trip from Calgary having no import possibilities. If the Alaska imports were in Edmonton, the vehicle could

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carry domestic freight from Calgary to Edmonton as a means to earn revenue along the way.

Eligible Drivers

While the Alaska-based vehicles have the flexibility noted above, they could not be used in this way unless the drivers were allowed under Canadian law to do so. Obviously, Canadian citizens and dual citizens are eligible. But what is little known is that Alaska Natives (who are at least 50 percent by-blood) are also eligible. In fact, all Native Americans and Canadian Aboriginals would be allowed to engage in trucking cabotage in either country. How can this be? It is the result of something we may have heard about in our history classes; namely, the Jay Treaty of 1794. Used to settle post-revolutionary issues between the U.S. and Great Britain, the Jay Treaty brought peace to the two countries at least up to 1812. Significantly, Article III codified the right for Natives of the United States and British North America to have free passage across the international border. This was a practical solution to

the problem of tribes whose traditional lands straddled both sides of the newly emerged border. In effect, members of First Nations (at least 50 percent by blood) in either the U.S. or Canada have the right to travel, work, study and retire in both countries. Today’s immigration laws in the U.S. and Canada still recognize these unique options. Thus, Alaska Natives are in a position to make a unique contribution to crossborder trucking activity. All truck traffic beyond Alaska must travel through Canada and, as noted above, trucks are the only mode of transport now open to flexible cabotage regulations. Alaska Natives need to be given greater opportunities to overcome their economic problems. In 2009, Alaska Natives had an unemployment rate of 16 percent; with only 7 percent for nonNatives. Per capita income for Alaska Natives is about half the size of that for non-Natives. These disparities are similar in size in other regions of the U.S.; but where Alaska is different is in the proportion of total state population. Alaska Natives represent about 15 percent of the state’s population. Across the U.S.

www.akbizmag.com • Alaska Business Monthly • April 2011


the Native proportion is only 1 percent. Alaska Natives own about 8 percent of Alaska businesses. Across the U.S. the Native proportion is under 1 percent. Thus, there is an important share of the Alaska population, which is underutilized relative to its economic potential. One last point to note is Alaska Natives, hired for cross-border trucking, not only enhance the efficiency of the Alaska-based trucking companies, but also they help to reduce the U.S. trade deficit noted above. How? Well, consider how cabotage works. A Canadian shipper is paying a foreign carrier for a wholly domestic service. This means Canada is importing a service the U.S. is exporting. Trade in goods and trade in services are both components in calculating our trade deficit. q

Dr. Darren Prokop

About the Author Dr. Darren Prokop is a professor of logistics in the College of Business and Public Policy at the University of Alaska Anchorage. He is also the director of the Master of Science in Global Supply Chain Management Program. Prokop specializes in transportation economics and its effects on international trade and supply chain security. He is also engaged in research examining the role of government policy as related to transportation, infrastructure provision and non-tariff trade barriers. Prokop’s Alaska-based research and publications involve air cargo logistics and port development. In addition to publishing his research in academic journals and trade magazines, Prokop is an active consultant to government and business. www.akbizmag.com • Alaska Business Monthly • April 2011

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TRANSPORTATION

Moving Freight in Alaska

Photos by Judy Patrick

Samson Tug and Barge in Resurrection Bay brings a load to Seward.

Commodities important to transportation industry Jack E. Phelps

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laska’s isolation from the rest of the country has always made logistics a problematic issue for the young state. This has not changed significantly in the early 21st century. Many parts of Alaska are not accessible by road and continue to depend on barge and container-ship traffic to bring goods to their communities. This affects both the local people directly, as the supplier of groceries and other needed items, but is also vital to the success of construction companies doing work in remote Alaska locations. In Nome, for example, construction material for the new hospital must be barged in during the narrow window of ice-free seas between mid-June and early September,

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said Neeser Construction’s senior project manager, George Tuckness. “Logistics planning becomes very important on a project like this. We have to plan to keep materials on site because it can be a long wait for the next barge load,” Tuckness says.

On the Water

Several companies provide waterborne freight service to Alaska from the Lower 48 and between various ports-of-call within Alaska. These may be divided between those that offer or specialize in barge service and those that utilize container vessels. Lynden Transport, for example, provides both barge service through its subsidiary,

Alaska Marine Lines (AML), and regular steamship service to major ports, such as Anchorage. Lynden also provides direct trucking service to Alaska via the Alaska Highway. Samson Tug and Barge, on the other hand, specializes in moving cargo by barge. Other major shippers include Pacific Alaska Freightways, Northland Services, American Fast Freight and Horizon Lines. Horizon Lines does not operate barges, depending entirely on Washington-based container ships to move a wide variety of freight from Tacoma to Anchorage, connecting through the Port of Anchorage to the Interior by way of the Alaska Railroad and a network of trucking services. The

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company also services Kodiak and Dutch Harbor with container vessels, according to a company spokesman.

Steam Ride

Lynden’s steamship service includes connections to such far-flung Alaska locations as Fairbanks, North Pole, Delta Junction, Fort Knox gold mine, Prudhoe Bay, Kenai and Railbelt destinations such as Eagle River, Palmer and Denali Park. Northland Services provides delivery in Western Alaska to major hubs like Dillingham, Naknek, Bethel and Nome, as well as more than 80 small villages, including those in the Yukon River basin. These shipments include heavy equipment, building material, groceries, dry goods and fishing supplies.

Alaska’s Commodities

According to the Alaska Office of Economic Development, bulk commodities also are an important factor in the Alaska shipping business. Coal from the Usibeli Mine near Healy, is moved by rail to Seward and bulk loaded on ships bound for overseas ports. While

the timber industry is a much smaller player now than it was in the 1970s and 1980s, logs are still shipped from Native corporation lands on Afognak Island, Kodiak Island and in Southeast Alaska. Most of them are bound for China, Korea and Japan and are carried on foreign-flagged vessels. On the import side of the equation, bulk cement from China has been delivered to Port MacKenzie on the Matanuska-Susitna side of Knik Arm. A major staple of the shipping industry’s cargo is Alaska fish products. Samson Tug and Barge moves vast quantities of containerized salmon from Prince William Sound (PWS) every summer, said spokesman Jerry Morgan. “In the summer, we move a lot of fish,” Morgan says. “Canned, frozen and fresh salmon goes out in dry and refrigerated containers.” AML also depends heavily on the fishing industry in both PWS and Southeast for a significant percentage of its business. The cargo is barged to Seattle and is then transshipped to its ultimate markets. Fish from Kodiak and King Cove

also leave their homeports packed in containers that are then moved by barge. A regular service provided by Samson positions containers at the two ports and, when they are loaded with fish, transports them by barge to Dutch Harbor where they are transferred to container vessels bound for Asia. American President Line, a subsidiary of Singapore-based Neptune Orient Lines, and Maersk Line, headquartered in Denmark, are the two main carriers transporting fish from Dutch Harbor to Asian ports, according to industry officials.

Fishing: Gold to Freight Industry

“A lot of people don’t realize how important fishing is” to the freight business in Alaska, says AML President Kevin Anderson. “It is simple economics. If we did not have large numbers of southbound containers loaded with fish to move every summer, rates would have to be much higher to cover the cost of business. Fishing is critical to getting freight moved north into Alaska.”

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The hundreds of container loads shipped each month during the summer makes possible year-round barge service to the small communities in the Southeast panhandle of the state. “The majority of container shipments during the remaining nine months of the year,” says Anderson, “represents a one-way market.”

Southeast Shipping

AML and Northland Services supply the Southeast communities with a wide variety of commodities with their barge service. They call at Ketchikan, Wrangell, Petersburg, Juneau, Sitka, Skagway and Haines. The barges bring in groceries, dry goods, curios, building materials, mining supplies, sporting goods, hardware, automobiles, heavy equipment and personal household goods. “Barges deliver just about anything you can imagine,” Morgan says. AML calls at Southeast ports twice weekly, according to Anderson, and arrives in Whittier once per week. “For the communities in Southeast,” Anderson says, “barging is the only way to get things there. The only other choice is air cargo,” which is not a practical or economic alternative for many items.

On the Move

It may seem odd, but Sitka-based Samson Tug and Barge does not call at Southeast ports, other than Sitka. Rather, its emphasis is on Prince William Sound communities, including Cordova, Valdez and Seward. As previously mentioned, the company also calls on Kodiak, King Cove and Dutch Harbor. “We move a lot of oil field service equipment through Valdez and Seward,” says Morgan. From Valdez, the cargo can be moved to Fairbanks and the North Slope via truck traffic on the Richardson Highway. From Seward, it can connect to the Alaska Railroad and travel to the Cook Inlet fields and points north along the Railbelt. “The majority of our cargo is containerized,” Morgan says, “but our barges also carry roll on/roll off equipment,” including heavy construction machinery. “General commodities and personal goods are included in the containerized shipments.” AML’s once per week service to Whittier connects Lower 48 shippers

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Cargo being offloaded at the Port of Anchorage.

with the Alaska Railroad, which operates a rail-barge and container transfer facility in the isolated port on the east side of the Kenai Peninsula. “We have a contract with Alaska Railroad to serve the Port of Whittier,” Anderson says. “On the main deck of our barges we load rail cars, and we have a rack over the top that is loaded with containers.” This way, each barge can deliver a variety of cargo and shipping modes, making the most of every weekly run. In addition, AML provides barge service to Cordova and Valdez out of Whittier on a year-round basis. “They are big southbound fish customers in the summer,” Anderson says, “and we provide 12-month inbound service, supplying groceries, staples, building materials and all the other commodities we deliver to Southeast communities.”

Trash Talks

One commodity that regularly makes the trip south is refuse from communities in Southeast. Towns like Wrangell, Petersburg and Ketchikan need to get rid of large amounts of garbage and trash, and barges are the only reasonable choice for this kind of cargo. “With all the new regulations, it is extremely difficult to permit new landfills, especially in an area so wet,” Anderson points out. Therefore, garbage from most Southeast Alaska communities is shipped by barge to Seattle and then by rail to landfills in the eastern parts of the Pacific Northwest. The two major receivers of Alaska refuse are Waste

Management Inc., a Houston, Texas, based company, and Allied Waste Industries of Scottsdale, Ariz. Waste Management is the largest refuse-disposal company in the United States, and, according to published company information, is committed to partnering “with communities to manage and reduce waste from collection to disposal.” The company’s Washington-based office takes delivery of Alaska refuse in Seattle and sends it by rail to one of its many landfills. The formerly family owned Redanko Ltd., now owned by Allied Waste Industries, is based in Bellevue, Wash., and operates a modern, environmentally friendly landfill in Klickitat County. Barge services in Alaska are responsible for safely delivering Alaska trash to these two disposal companies. Removing refuse from Southeast Alaska communities has, since the late 1990s, become an important component of the barging business in Alaska. According to Anderson, AML collects garbage in 40- and 48-foot, open-top containers in Haines, Sitka, Wrangell, Petersburg and Ketchikan, and delivers it by barge to the Port of Seattle.

Then There’s Steel

Scrap steel is another commodity that barge companies regularly transport out of Alaska. SeaTac Marine Services LLC is a Seattle-based marine logistics company that specializes in barging of material. The company regularly calls at Alaska ports and collects bulk cargoes of

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scrap to be hauled to the Port of Tacoma for reclamation. AML also hauls scrap to either Seattle or Tacoma, depending on the customer, said Anderson. “We haul both scrap and contaminated soil on barges from Southeast Alaska to either Washington port, according to the needs of our customers,” Anderson said. Under rules formulated by the federal Environmental Protection Agency (EPA) and the State of Alaska Department of Environmental Conservation, many former industrial sites in Alaska are subject to remediation, and this often entails removal of soil containing petroleum or other contaminants. When the scope of the remediation project calls for the removal of volumes that cannot be easily transported in barrels, or when there is an accumulation of contaminated soil that can constitute a barge load it is transported south on marine equipment under EPA hazardous material regulations.

Gold, Too

A recent addition to the list of products moving south on barges is concentrate from the new Kensington

Gold Mine at Berners Bay, near Juneau. Owned and operated by Coeur Alaska, a subsidiary of Coeur d’Alene Mines Corp., Kensington is an underground gold mine that began producing gold concentrate in June 2010. According to the company, it produced more than 15,000 ounces in the third quarter of 2010. The company expects Kensington to produce an average of 125,000 ounces per year for the life of the mine. Gold is not processed at the mine site, but is shipped as a concentrate. Coeur CEO Dennis Wheeler said about half of the Kensington concentrate will be sold to China National Gold Group, a company based in Beijing, China. The remainder is going to other refiners. AML has the contract for moving Kensington Gold Mine concentrate from Alaska to Seattle. “We haul it in 20-foot containers (so-called foreign boxes) to Seattle and load them onto foreign vessels for delivery to the Asian purchasers,” Anderson says. This new contract has added a welcome yearround commodity to the list of products moving to market via barge.

During the nine months of the year when the fishing industry is not producing cargo for shippers to haul to markets outside Alaska, there is a trade imbalance that results in many empty containers being back-hauled to the Lower 48. That’s why a new production, such as gold concentrate from Kensington, is so important to the shippers. “We’d love to see new manufacturing industries start up in Alaska,” Anderson says. Not only would it create new local jobs, it would contribute to the overall economy, not least by helping keep shipping costs under control. Asked about whether there were incentives available to businesses that may be considering producing new products that could be shipped out of Alaska by barge, all the barging companies agreed that there are possibilities for competitive shipping prices. “There are certainly opportunities for private-shipping contracts at rates that could be quite attractive,” Samson’s Morgan says. No matter what, barge and container shipments to and from Alaska are a fact of life that is not likely q to change any time soon. 

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R e g i o n a l R e vi e w

By Tracy Barbour

Interior Alaska

Photo by Donna J. Gardino

Resting at the heart of the state

This intricate carving in front of Fairbanks City Hall was completed as a symbol of the friendship between America and China by Qifeng An (left) with Secretary Amber Courtney (center) and Fairbanks Mayor Jerry Cleworth.

Mount McKinley also known as Denali. The Brooks Range rests at the northern end of the region. Located between the two ranges are the expansive Yukon flats, a huge area of wetlands, forest, bog and low-lying ground at the confluence of the Yukon, Porcupine and Chandalar rivers.

Fairbanks at a Glance

Population per City: Approximately 35,200 Location: 360 miles north of Anchorage Key Local Contacts: Fairbanks Mayor Jerry Cleworth, Fairbanks North Star Borough Mayor Luke Hopkins, and Doyon Limited President and CEO Norman Phillips Government Structure: Fairbanks has a council-mayor form of government. Main Industries: Government, mining, tourism, construction and health care Schools: University Alaska Fairbanks Hospitals: Fairbanks Memorial Hospital and Denali Center and the Chief Andrew Isaac Medical Center Airport: Fairbanks International Airport

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The Yukon Flats area, which covers about 11,000 square miles, is protected under the Yukon Flats National Wildlife Refuge. The area is a critical waterfowlbreeding ground and home to a large deposit of crude oil and natural gas, making it a valuable asset to the region. With its highly continental climate, the Interior’s weather is marked by temperature extremes. It has some of the warmest summers in Alaska, as well as

Photo courtesy of Alaska Department of Labor and Workforce Development

T

he Interior region represents the virtual center of Alaska. The landscape of Interior Alaska is dominated by high mountain ranges and wide river flats. The Alaska Range forms the southern boundary of the region and contains North America’s tallest mountain: the 20,320-foot-high

Alaska Department of Labor Economist Alyssa Shanks.

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some of the lowest winter temperatures. In addition to its variable weather, the Interior is known for the trans-Alaska oil pipeline, Denali National Park and Preserve, the northern lights or aurora borealis, and its gilded past. As a region, Interior Alaska encompasses everything from Holy Cross to Tok. Other cities in the area are Fairbanks – known as the Golden Heart City – Anderson, Cantwell, Central, Circle, Delta Junction, Fort Greely, Healy, Livengood, Manley, Nenana, North Pole, Northway and Salcha. Military installations in the Interior include Fort Wainwright near Fairbanks, Eielson Air Force Base just outside North Pole and Fort Greely, which is now a missile base. “The Interior is an enormous region with communities that have very little in common,” says Alaska Department of Labor Economist Alyssa Shanks. For example, its largest city, Fairbanks, is metropolitan compared to the rural nature of many other places in the region. Its economy is driven by a mix of stable government jobs, mining, the military, University Alaska Fairbanks and tour-

ism. Denali, which depends on the tourism industry, is totally seasonal. Many of the smaller Interior communities are plagued with high unemployment and a lack of job opportunities. “It’s hard to make sweeping generalizations about the Interior because the places are so far apart and so different,” Shanks says.

Fairbanks North Star Borough

The Fairbanks North Star Borough (FNSB) is part of the Fairbanks Metropolitan Statistical Area. In addition to Fairbanks, it includes North Pole, Ester and College (which encompasses the University of Alaska Fairbanks). Fort Wainwright and Eielson AFB are also part of the borough. Last year, the FNSB – like the rest of the state – experienced job growth after seeing declines in 2009, according to Shanks’ January 2011 Alaska Economic Trends report. The borough added 800 jobs in 2010, a 2.1 percent jump from 2009 and the greatest percentage of increase in a single year since 2004, Shanks reported. The health care industry contributed the most to the overall

growth of the area’s economy, followed by government, construction and professional and business services. In 2010, health care grew by 400 jobs in ambulatory care, nursing and residential care and the hospital. “Demand for local health care may have increased because more procedures are available locally,” Shanks stated. “Another possibility is that the prior year’s growth was so muted, it created a backlog of health care jobs to fill.” Shanks added that in the past, Alaska hasn’t sustained growth that high for more than a year. So health care is likely to grow again in 2011, but at a slower rate of about 200 jobs. State government in the Fairbanks area expanded by 200 jobs, or 3.8 percent in 2010, Shanks said. This was the largest increase in a single year since 2002, due to more firefighters and increased enrollment and jobs at the University of Alaska Fairbanks. Shanks also reported growth in construction employment in 2010. That area grew by 100 jobs, mainly because of a repair project at the North Pole

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refinery. Other construction projects completed last year included the Ruth Burnett Sport Fish Hatchery, Barnett Street Bridge and new housing on Fort Wainwright. The borough’s leisure and hospitality industry also fared well in 2010, maintaining its 2009 level of 4,000 jobs – despite losing 120,000 cruise ship visitors that would have made their way to the Fairbanks area. “Tourist counts from the Morris Thompson Cultural and Visitors Center show a gain of 61 percent in the third quarter,” Shanks stated in the Trends article. “These jumps are likely the result of a rise in independent Alaskan and out-of-state visitors and an increased awareness of the center’s presence.”

Military and High Energy Cost Distinguishing Factors

In an interview, Shanks said the FNSB’s employment growth in 2010 was not surprising. Deployed troops returned to the area, spending money on a variety of goods and services. “Because they had the military for the whole year, it didn’t surprise me too

much that there was that much growth,” Shanks says. “Military spending has a positive impact on the local economy.” The presence of the military is one factor that differentiates the Interior from other parts of the state. The high cost of energy is another distinguishing factor. Energy costs are extremely high in the Fairbanks area, mainly due to the lack of a readily available source. “In Southcentral Alaska, we have gas that’s really close in Cook Inlet. In Southeast, there are a lot of hydroelectric projects,” Shanks said. One example is the proposed Susitna Hydroelectric Project (the Susitna Dam project) that would supply electricity to Alaska’s Railbelt region. However, the longstanding project is many years down the road. The new Superior Pellet Fuels plant provides immediate results. The factory – situated between Fairbanks and North Pole – utilizes waste wood to make pellets that can be burned as a clean fuel source. The 12,000-squarefoot plant can process about 12 tons of green material every hour or six tons of pellets. It will directly add $4 million

to the local economy, with another $4 million expected in indirect benefits, according to a study by the Fairbanks Economic Development Corp. As another source of alternative energy, a Fairbanks company has opened a wind farm near Delta Junction that provides electricity to Railbelt communities.

Fairbanks Offers a Small-Town Feel

Boasting a population of about 35,200, Fairbanks is the transportation hub of Interior Alaska. It is the state’s secondlargest city, but it still has a small-town feel, according to Mayor Jerry Cleworth. “I hope we don’t lose that,” he says. “Many visitors, especially those from Europe, enjoy the city’s country appeal,” Cleworth says. Fairbanks’ pristine beauty and contrasting weather is also a draw. Describing Fairbanks, he says, “In January, when it gets cold, there is no wind here. When the sun shines, it’s a glistening winter wonderland. In the summer, it’s an endless summer. We get a lot of visitors that come here just to see the northern lights, and most of the time they’re not disappointed.”

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In a few years, people will have another reason to visit Fairbanks. In 2014, Fairbanks will host the 23rd Arctic Winter Games. Currently, the city hosts an annual Ice Alaska competition that generates widespread interest. “People come here from all over the world to do carving,” Cleworth says. “They like the ice here because it’s very clear.” Perhaps no other place in the state has such a golden history as Fairbanks. Native Alaskans have inhabited the area for thousands of years, but goldrush fever struck in 1902 when Felix Pedro discovered gold in the area. The city sprang up around a trading post operated by E.T. Barnette, who named the city in honor of Sen. Charles W. Fairbanks of Indiana. Barnette became Fairbanks’ first mayor when it was incorporated in 1903. Gold still remains in the area, as evidenced by the nearby Fort Knox and Pogo gold mines. “Today, Fairbanks’ economy is growing at a modest level,” Cleworth says. That’s thanks in part to the presence of Eielson Air Force Base and Fort Wainwright military installations, which pour money into the borough’s economy.

Photo by Donna J. Gardino

The Statue of Liberty is part of a larger carving by Qifeng An of China.

However, Cleworth says, “They’re our Achilles heel; if they were to close, it would have a major impact on the city.”

Major Construction Projects

Fairbanks has a number of important construction projects scheduled to enhance the city’s infrastructure. University Alaska Fairbanks, for

instance, is constructing a Life Sciences building that will include new lab facilities, classroom space and faculty offices. The project is scheduled to be completed in 2013. The Tanana Chiefs Conference is moving forward on a $75 million medical center across from Fairbanks Memorial Hospital. The clinic will replace the current 23,000-square-foot Chief Andrew Isaac Health Center, which provides services to Alaska Natives. The new facility will comprise 100,000 square feet. Its construction is projected to create about 175 jobs, plus 100 permanent positions that would be needed to operate the center once it’s finished. The project’s anticipated completion date is December 2012. Additionally, a variety of road improvement projects are in the works. These will include constructing new roads, as well as repairing and resurfacing existing streets. “In the next year or two, we will be doing more lane miles than we ever did before,” Cleworth says. “My priority as mayor is to protect the infrastructure of q the city.”  Architects · Engineers · Surveyors

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© 2011 Chris Arend

© 2011 Chris Arend

HEALTH & MEDICINE

Providence technician Andrea Hansen helps patient Lynn Dewey prepare for a check up at Providence’s Heart and Vascular Center.

Michael Sousa prepares for another day’s work in the Providence Heart and Vascular Center.

Reducing Cardiovascular Risk Getting Alaskans heart healthy By Neal Webster Turnage

I

n a state with a reputation for vigorous people who lead active outdoor lifestyles, results from the Alaska Department of Health and Social Services report, “The Burden of Heart Disease and Stroke in Alaska: Mortality, Morbidity, and Risk Factors, December 2009 Update” came as a surprise to some. “More Alaskans die of heart disease and stroke combined than any other cause. Of the approximately 3,500 Alaskans who died in 2007, 766 died from either heart disease or stroke,” began the chapter on mortality. It was a wake-up call to many of the state’s leading health institutions that heart health was in serious condition. “Alaska’s currently high level of population risk poses a significant challenge for public health to keep ahead of the curve and reduce the state’s heart disease and stroke burden into the future,”

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continued the report. State health officials and medical personnel didn’t take the news lightly. All would argue that it would be foolish to think the challenges concomitant to cardiovascular care in Alaska can or will ever be completely eradicated. However, all are acutely aware that even the smallest of steps toward better heart health can have significant impact. Since the DHSS report was released more than a year ago, significant improvement has been made in the field of heart health. Large public-sector health providers have equipped themselves with the latest technology and added renowned cardio specialists to their staffs. In some cases, changes to preventative and post-op care have been made, including more cardiac rehabilitation, which, at the time of the report, “less than one-third of the approximately

15,000 Alaskans who reported having had a heart attack said they were referred to cardiac rehabilitation.” Another significant challenge for well-rounded cardiovascular care in Alaska is how best to provide for the 40 percent of the population living in communities with less than 10,000 residents; and on a macro level, maintaining cardio protocols on par with other states in the country.

More Cath labs, Better Technology

“Providence Alaska Medical Center in Anchorage (PAMC), has gone from four cath labs to six,” says Bob Hughes, director of the Providence’s Heart and Vascular Center. “And we’ve tremendously advanced our care of arrhythmia. We have one of the top electrocardiologists in the country here who performs coronary oblations on arrhythmias.”

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B U S I N ESS

PROFILE

Wolk & Associates CareNet Inc. Promoting Independence. Enhancing Care. Improving Life.

C

areNet Inc. has been providing dependable, private-duty home care services in Alaska since 1996. The company’s name embodies the distinctive approach it employs to deliver in-home care to older Alaskans. A nurse-owned and -managed company with 25 years of industry experience, CareNet maintains a staff of skilled registered nurses, licensed practical nurses, certified nurse aides and homemakers to assist clients. They help clients with everything from personal care and bathing to household chores and errands. Nursing services may include medication management, post-hospital care and more. Services are available days, nights, weekends and holidays on an hourly or live-in basis. “CareNet Inc. is devoted to helping older Alaskans remain independent by providing the highest quality of care that they deserve and require to live comfortably and safely in their own homes,” said Vice President Lorna Mills, RN.

HELPING PEOPLE FIRST

While CareNet has a reputation for providing high-quality care, it is proud to differentiate itself as a company in the business of helping people first. The Anchorage-based agency is not a franchise. “CareNet is proud to be a locally owned Alaska company,” Mills said. CareNet provides personalized attention that begins with a free nursing evaluation of all new clients and includes the development of an individualized plan of care involving client, significant other and family input. Nursing supervision of the caregivers and an on-call nurse 24 hours a day, seven days a week, also are available. In addition to using a successful “nurse model” of care, CareNet adopts a flexible approach to scheduling. Mills said: “We do not lock our clients into a contract.” As another distinguishing characteristic, CareNet is meticulous about its staff members – some of whom have worked for the entity since its inception. CareNet

From left to right: Patsy Peshel, Lorraine Hoffman LPN, Lorna Mills RN, Brett Mills RN, Britta Lemley RN and Florence St. Armand all of CareNet, Inc. strives to hire locally from area agencies providing personal-care training classes. The company also promotes educational and training opportunities for its staff, including 40 hours of personal care assistant training by an RN. Participants receive PCA certification from the State of Alaska Division of Senior and Disabilities. Other professional-development opportunities include Alzheimer’s training and certification, hospice or end-of-life -care training, and continuing education credits for certified nursing assistants.

providers through education, advocacy and best practices. CareNet services can be paid for: privately, by long term care insurance, Medicaid, VA or other support programs. “We recognize that home care choices can be difficult as potential clients consider where to find trusted, reliable and affordable care for their loved ones,” Mills said. “Elders deserve the peace of mind, trust and security that a member of the National Private Duty Association can provide.”

A RESOURCE TO THE COMMUNITY

One of CareNet’s primary services is dispensing information to families caring for aging adults and children caring for their aging parents. CareNet prides itself on being a valuable resource for the community. This includes providing referrals to other organizations, as well as collaborating with area resources to assist clients who need support. “We take the time to listen to a person’s needs and assist them with the resources that could help,” Mills said. CareNet is a charter member of the Alaska chapter of National Private Duty Association, a nonprofit organization that enhances the strength and professionalism for private-duty home care P A I D

A D V E R T I S E M E N T

For more information contact CareNet Inc. Lorna Mills, RN, Vice President 2909 Arctic Blvd., Suite 101 Anchorage, Alaska 99503 Phone: (907) 274-5620 Fax: (907) 274-5621 www.carenethomecare.com carenet@gci.net


Tips for Heart Health

Quality Community Healthcare Right Here in Your Hometown

n Don’t smoke or use tobacco products n Exercise aerobically at a moderate level most days of the week n Take all of your medications as prescribed to keep risk factors under control n Eat a heart-healthy diet low in saturated fat, and reach and maintain your desirable weight n Get regular health screenings, including blood pressure, cholesterol and diabetes tests – and know your family’s health history Source: Alaska Regional Health Management Center Director Ruth Townsend

Juneau, AK 907-796-8900 www.bartletthospital.org

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Providence recently added new technology for treating atrial fibrillation, which occurs in blood clots. PMAC has two labs dedicated to electrophysiology mapping, whereby it is possible to oblate without the use of X-rays. PAMC is equally as vigilant in treating stints. “We’re doing GORE-TEX stints now (the same material utilized in high-tech winter gear), which now eliminates the need to do surgery on stint patients,” Hughes said. Which of course, addresses cost effectiveness, an ongoing challenge that confronts all health care providers. Also in Anchorage, Alaska Regional Hospital unveiled a remodeled cath lab in March. The upgrade, says Ruth Townsend, director of Alaska Regional’s Health Management Center, “will allow the capability to do heart catheterization and interventional radiology in all three of our cath lab rooms. We’re also upgrading a machine that can perform quick turnaround lab tests right at the patient’s side.” Alaska Regional also offers 3-D echo imaging in cardiac surgery, which enhances the images pre-op to surgeons; and the facility offers the option of robotic heart surgery, the first in the state to do so. Echo imaging also is a component of Alaska Children’s Heart Center LLC, located on the Providence Campus in

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Anchorage. The center specializes in treating children with heart disorders and incorporates echo imaging into its retinue of services for children, which also include echo image storage capability and electronic health records.

Outside Anchorage

Anchorage is viewed as the nexus of critical cardio care, but efforts are being made to make that same kind of care available outside the city. Alaska Regional’s Heart Center staff “travels to Fairbanks and Juneau to collaborate with hospitals in those areas to form alliances for services that may not be available locally,” Townsend says. Karl Sanford, assistant administrator at Fairbanks Memorial, says Fairbanks has greatly improved their heart health services. There was a time when a heart patient with blockage was received in Fairbanks it meant a stint IV then a transfer to Anchorage. “Now if you show up in the Fairbanks Memorial ER with blockage, you’ll go immediately to our cardio cath lab where a procedure will be performed to open up the blockage.” The hospital, however, does not perform heart surgery. The issue of patients in Fairbanks – and further off the grid – in need of a major procedure or diagnosis and cardio care elicits a significant question: what do 40 percent of the population living outside Anchorage, Fairbanks and Juneau do? To find the answer, you have to go back to 1995, when, according to public records, federally funded health care agencies within the state collectively decided to band together to provide cost-effective solutions. An alliance was formed. A year later, the alliance was formally chartered as the Alaska Federal Health Care Partnership (AFHCP). The AFHCP currently puts its efforts into telehealth and virtual-clinical teleconferencing. In many instances, diagnosis and assessments can be made via video link and specific referrals can be provided. Sanford says in some instances health services are provided by citybased physicians who make rounds once a month in remote and rural areas. “For cardiology, though its not federally funded, we’ve developed access for

providers in rural communities, Denali Park, Delta Junction Kaparuk oil field, amongst others, where cardio patients can be seen right away,” Sanford said. If a condition is urgent, the provider determines if the patient can wait for the next available commercial flight or if medivac is necessary. Once a patient can be accessed via an airport, there’s also LifeFlight. Townsend says LifeFlight, Alaska Regional’s critical care fixed-wing, airmedical transport program, can make the difference between life and death.

Alaska Regional provides the service to patients needing transport throughout Alaska and the Lower 48 as another viable method of transport. The center, the only one of its kind in the U.S., allows fixed-wing aircraft to taxi to the back door.

Prevention and Rehabilitation Programs on the Rise

Though what has been accomplished through the improvement of services and facilities cannot be overlooked, as the DHHS study illuminated,

body scans so detailed we can spot signs of early heart disease or osteoporosis. Information that’s allowing people to lead longer and fuller lives; which is the ultimate reward for technologists like Heidi and Karen – just two of the employees living the promise of People First.

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Photo courtesy of Alaska Regional Hospital

Technician Ruth Townsend, Alaska Regional Hospital’s Health Management Center Director, works with patients in a cardiac rehabilitation class.

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Photo by Charles Mason/Courtesy of Fairbanks Memorial Hospital

preventative and rehabilitative care are crucial. Hospital cardio departments, while taking a more vigilant approach now, still on some level feel that part of the responsibility, as it applies to preventative care, is incumbent upon the individual. It’s a familiar refrain throughout each of the major hospitals now: know the warning signs of a heart attack – discomfort in the chest and upper body region and shortness of breath” are the most common – along with know your family heart health history and your pre-existing conditions such as being diabetic or overweight. As of late, Alaska Regional has taken great strides to become extremely proactive in preventative medicine. The center now holds “A Fair of the Heart” community health fair each February. Selected lab tests are offered for free along with educational seminars, blood pressure tests, healthy eating demonstrations and face time with cardio experts to discuss concerns. There’s also a “Go Red for Women,” heart-healthy breakfast for the community to learn about women and heart disease. Townsend says the staff is provided with continual education about the latest heart-related technologies, new interventions and medications. “The nursing staff also has cardiac educational requirements that must be met annually,” she said.

Dr. Carson Webb (right) and technician Dan Walsh perform a cardiac catheterization in the Fairbanks Memorial Hospital Porter Heart Center Cath Lab.

When it comes to post-op care, most of the primary hospitals in populated cities have come to realize they were remiss and have begun to face head on the challenge of improvement in the area. First it is important to note, that Alaska hasn’t really been behind the curve; the problem of adequate cardio rehab has been recognized nationally. “There’s been a big push in the U.S. to keep people out of the hospital and readmissions down,” Hughes said. “Heart failure is the chief problem of readmission.” Providence now employs a full-time cardio-rehab staff that runs a program exclusively dedicated to address the needs of post-op heart patients. In Fairbanks, Fairbanks Memorial has similarly taken steps to keep their heart patients healthy post procedure. “We set up follow up appointments with each cath-lab patient before

they leave the facility,” Sanford said. During the follow up, patients are counseled in how to make lifestyle changes to improve heart health and are taught how to monitor their own cardiac health. Though the patient has the ultimate decision on whether or not to participate in a cardio rehab program, Sanford says, “It’s made clear to all that the rehab program is designed to return the heart to pre-heart attack stage.” How all of the changes recently initiated will impact heart health statistics in the next DHSS update remains to be seen. It’s highly likely deaths from heart-related illnesses will have declined. That is if the state can continue to attract top-of-the-line talent. Physicians, Sanford says, don’t seem to have a problem finding the state’s top facilities, one of the reasons Alaska keeps pace with the rest of the country in respect to cardio treatment and technology.  q

www.akbizmag.com • Alaska Business Monthly • April 2011


HEALTH & MEDICINE

OP-ED

Find Real Health Care Reform

Demand adaptation and innovation

T

he Patient Protection and Affordable Care Act (PPACA) of 2010, also known as health care reform, is receiving mixed reviews from both advocates and opponents of the bill. Some provisions have proven difficult to implement and regulators are slowly rolling out guidance. As health plans have their first renewals following Sept. 23, 2010, we are seeing the removal of lifetime maximums, and the phase-out of annual maximums. The law eliminates pre-existing condition exclusions for children under age 19. Children can now stay covered to age 26, and new plans are paying for expanded preventive care. By early February 2011, rulings were released in four federal court cases on different lawsuits brought against the federal government challenging the constitutionality of the PPACA. Two of the cases were decided in favor of the federal government, and two have ruled that the individual mandate – the requirement that everyone in the country purchase insurance – is unconstitutional. The State of Alaska joined Florida and 25 other states in a suit in Federal District Court challenging the individual mandate as a violation of Congress’ Commerce Clause powers. U.S. District Judge Roger Vinson ruled that not only was the individual mandate unconstitutional, but because the PPACA lacks a severance clause, the entire law must be thrown out. From a practical standpoint, Vinson is correct. With no individual mandate, then the entire bill is in jeopardy. All of the popular provisions within PPACA cost

money. In 2014, pre-existing condition limitations will be eliminated for everyone, not just children. We can only afford this if everyone is included in the insurance pool. If you are allowed to wait to purchase health coverage until you need it without any penalty, most rational people will wait until they are sick – driving up costs for everyone else. Regardless of one’s opinion on the specifics of the PPACA, the necessity of reforming our health care industry is paramount. Our current spending on health care is unsustainable. The U.S. Department of Health and Human Services, Centers for Medicare and Medicaid Services (CMS) reports the following data regarding U.S. spending on health services. This steady increase in health care spending limits employers’ ability to invest in other areas and may threaten their viability. More businesses face the difficult decision to sacrifice the quality of health coverage provided to their employees, or eliminate it altogether. Cost-shifting through increased deductibles and out-of-pocket costs, or increased employee contributions is common. So why have we lost control of health care costs? What, or who, is driving the rampant cost increases? Complicated regulatory and pricing environments, provider shortages, technology advances allowing treatment of more complicated diseases, an aging population, chronic diseases like diabetes, heart disease, obesity … all result in a tremendous increase in cost.

Photo courtesy of Parker, Smith & Feek Inc.

By Greg Loudon

Greg Loudon

Broken Delivery and Payment Model

Most consumers are disconnected from the financial purchase of their care. We have grown to expect that a doctor visit only costs $25 (our copay), or that our antibiotic costs $35 – oblivious that the doctor is really being paid $250 for that office visit, several hundred more for the chest x-ray, and our medication costs more than our monthly car payment. Our current model of health care delivery in Alaska is called fee-forservice. A provider performs a service and we pay for it. Fundamental economics, willing seller and willing purchaser – this should be an efficient model, but it’s not.

www.akbizmag.com • Alaska Business Monthly • April 2011

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We have difficulty figuring out the price of our care, but it is equally difficult to determine the quality of care. To purchase a new car, you rely on readily available statistics to make an informed decision, and you understand the quality difference between the $80,000 Mercedes and the $20,000 Kia. Armed with information, you weigh price and quality and make a determination of value. How many have called different providers and shopped prices on an annual physical? Even if you knew

that a visit to Dr. A costs $350, and a visit to Dr. B $2,000, which one offers the best value? With your health at stake are you going to buy the low bidder? Maybe. If you knew that outcomes were similar, you may choose the lower cost. Why do Dr. A and Dr. B charge such different amounts for a similar service? Before handing out a script for a statin, Dr. A pushes her patients to lose weight and start exercising more. She would rather lose a patient then give in to a patient’s desire for

the newest drug. Dr. B’s approach is different. He chooses to order more extensive services up front or gives in to his patient’s request for the newest medication. Is Dr. A more virtuous? Not necessarily. But people do exactly what they are incented (paid) to do. Run more tests – you have a lower chance of being sued, your patients think you’re thorough and you get paid more in fees. Before you know it, defensive medicine, patient demand, increased technology, higher overhead and more staff have changed the way that you run your practice. Add to this mix a provider shortage and the lack of competition and it yields yet higher prices.

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In 2003, health savings accounts (HSAs) joined an alphabet soup of personal health accounts (FSA, HRA) supporting the consumer-directed health plans (CDHP) concept. CDHP plans feature a large deductible, which can be funded from the employee’s health account. Employees spend their own money from health accounts or from their pocket until the deductible is met. Variations allow employees to own the money outright, or carry it over from year-to-year. The concept is simple: we behave differently when our own money is at stake. Remember some of the factors driving our health care costs – chronic diseases? These few conditions drive the majority of all health care spending. Ironically, you can save more money on these conditions by spending more money – early on. Wellness plans and disease management programs address this problem directly. Keep people healthy and they won’t get sick. Unfortunately, we don’t always engage in behaviors that keep us healthy. We don’t sleep or exercise enough, we eat and drink too much, and generally don’t pay attention to our health until we are forced to go to the doctor. Doctors get paid to perform services. In fact, they are paid more if we stay unhealthy because they must perform more services. Wellness plans create incentives and opportunities to stay healthy. There has to be a strong

www.akbizmag.com • Alaska Business Monthly • April 2011


employer commitment to wellness to be effective, but data shows a good wellness program delivers a positive return on investment. Disease management (DM) focuses on the segment of the population having chronic disease, with proactive treatment mitigating expensive hospitalization. A DM vendor identifies patients through review of claim data. DM nurses provide patients regular monitoring, coaching and assistance to manage their disease. These two programs are so effective that nearly every major insurer offers some form of them as a way to reduce costs. But more often, it is the large self-insured employers that are driving these programs. Why? Insurers have a job to do for their clients, but they also have to remain profitable. Because employers often change insurers based on pricing, insurers may have a more volatile turnover rate than a large employer. The insurer wants to keep patients healthy for the next two or three years, but they have less incentive to focus on changes that will yield results 10, 15 or 20 years down the line. An employer with a steady work force may have an employee for their entire career. Keeping that employee healthy saves money. The incentives are aligned.

welcome the opportunity to enlighten their patients and discuss their treatment plan. If your physician doesn’t, find someone else. President Obama is right – health care costs have grown to an unsustainable level and they have to be brought under control or our country will suffer. The PPACA doesn’t appear to provide the right kind of health care reform, and our current delivery system cannot adapt and innovate unless you demand it. Your business, and the future prosperity of America require it.  q

About the Author Greg Loudon is an employee benefits account executive for Parker, Smith & Feek, one of the 100 largest insurance brokerage firms in the nation. Responsible for the design and implementation of employee-benefit programs for a variety of governmental, Taft-Hartley and private-sector clients to provide health and welfare consulting and brokerage services. Loudon is an active in Alaska legislative issues and an experienced, invited speaker on employee benefits topics.

Making the top 50 “best hospitals” is

being the only alaska hospital on the top 50 list is

big.

better.

New Models?

In parts of the country, large employers are building their own clinics on campus and hiring their own medical providers. By having medical services available at the work site, employees spend less time away for an appointment. The employer pays only for the direct salary of the doctors and nurses that provide the care and rent for the space. While there are few employers in Alaska large enough to make this pencil out, we may see it in the coming future. Other health plans are adopting alternative care models such as collaborative care or the patient-centered home. While these programs aren’t available in Alaska today, they may be developed in the future Even if you can’t participate in one of these alternative care models – you can demand more from your providers. Question the care you receive. I am optimistic most physicians will

better. We are humbled and honored to be the only hospital in Alaska on the Top 50 “Best Hospitals” list for Orthopedics. That’s the Top 50 in the whole U.S. Thanks to the staff at Alaska Regional, as well as to our orthopedic and spine physicians for this outstanding achievement. To learn more about the best orthopedic services in Alaska, please call 264-1471.

www.akbizmag.com • Alaska Business Monthly • April 2011

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TECHNOLOGY

Data Security More than protecting bits and bytes By Tracy Barbour

Companies store and transmit huge volumes of data, including customer and personnel records, intellectual property, trade secrets and other proprietary assets. Securing this information against malicious attacks, accidents or negligence is vital to their operations.

D

ata security is growing in importance, as more people use mobile devices to access corporate networks and organizations strive to meet government and industry standards for protecting their customers’ information. Digital data amounts to more than bits and bytes. It represents the lifeblood of organizations, says Bill Ketrenos, vice president

of information security and enterprise networking for Structured Communication Systems, which has offices in Alaska, Washington, Oregon, Idaho, Illinois, Nevada and California. Companies store and transmit huge volumes of data, including customer and personnel records, intellectual property, trade secrets and other proprietary assets. Securing this information against malicious attacks, accidents or negligence is vital to their operations. “Every aspect of the business is touched by technology,” Ketrenos says. “It’s not just their back-end systems; it’s also the way they’re communicating and touching their customers.”

Approaches to Securing Data

Bill Ketrenos, vice president of information security and enterprise networking for Structured Communication Systems.

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Data security is a broad concept that involves the protection of sensitive information against loss, corruption or unauthorized access. For Ketrenos, it centers on three fundamental tenets: availability, integrity and confidentiality. The availability of data is essential because, as Ketrenos puts it: “If you can’t get to it, what good is it.” Confidentiality is especially important when intellectual property or other private information is concerned. Integrity addresses the accuracy or validity of the data. In banking, for example, it’s

crucial for customers to have access to current and up-to-date data. “They have to be able to validate their account information,” Ketrenos says. “They have to know that what their account says is what they actually have.” Todd Clark, CEO of Anchoragebased DenaliTEK, thinks of data security in terms of data loss, productivity loss and the disclosure of sensitive information – not necessarily in that order. He outlines three levels of security for companies. First, there’s a best-practices approach. This involves having adequate perimeter protection (such as a firewall), adequate backups, antivirus and periodic reviews by experts to assess typical vulnerabilities. The next level, Clark says, is to have a security plan developed by an IT firm that has taken a specific look at the details of your business. At the highest level, large companies can develop a complete security policy – which can cost tens of thousands of dollars. “We meet with the president and CFO and ask questions about the sensitivity of their data and potential threats,” Clark says, describing his company’s approach. “Typically, the higher the security the less convenient and more costly it will be for the end user.” Clark says large companies tend to take data security more seriously, and

www.akbizmag.com • Alaska Business Monthly • April 2011


with valuable trade secrets might be wary of outside threats. For Alaska Communications, protecting customer information is a principal concern. The company has a vast amount of information unauthorized users might want to access. That includes customers’ names, phone numbers and credit card information. “We think there’s an important trust relationship between us and our customer,” says Vice President of Process Transformation and IT Russell Girten. “The last thing we want to happen is a violation of our customers’ trust. We do everything we can to protect that.”

Growing Threats

Shawn Fuller, president and CEO of TekMate LLC.

they have more resources to address the issues. people running smaller businesses – without any trade secrets or legal obligations for security – often feel digital security is something that only large companies need. They feel taking security measures is less critical if they don’t have any trade secrets or aren’t required to do so legally. However, Clarks disagrees. “In reality, there’s a rudimentary level of data security that all businesses need,” he says. Disaster protection is an important component of data security, says Shawn Fuller, president and CEO of TekMate LLC. Disaster protection uses on-site virtual servers and remote storage to ensure the availability of information in the event of natural disasters, server crashes and accidents. “What good does it do to spend thousands of dollars to keep a hacker out,” Fuller asks, “if you don’t have a reliable backup solution?” He advocates a two-tiered approach to data security. The first tier is to secure the data. The next tier should address how to protect the data from internal and external threats. Whether a company focuses on safeguarding data from the outside or the inside will depend on its industry. Professional services companies, for example, might concentrate on protecting their customer data from employees. Public companies

The threats of loss or stolen data are very real and potentially devastating. They’re also growing. Data breaches involving personally identifiable information increased by more than 600 percent between 2008 and 2009, according to the Theft Research Center. Research by Symantec indicates that hacking accounted for more than 60 percent of the identities exposed in 2009, a 22 percent increase over 2008. Also in 2009, physical theft or loss accounted for 37 percent of data breaches that could lead to identity theft, and credit card information was the most commonly advertised item for sale underground.

Russell Girten, Vice President of Process Transformation and IT at Alaska Communications Systems. www.akbizmag.com • Alaska Business Monthly • April 2011

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Data loss results from a wide range of causes, from malicious attacks and fraud to accidents. Hackers use viruses, worms, spam and other methods to wreak havoc on a company’s network. However, the most common threats to data security are employees and others with access to corporate information. Whether stolen by hackers or employees, data is a valuable commodity. There’s a booming black market for functional credit card numbers, and identity thieves routinely use Social Security numbers to obtain loans. No matter how the data loss happens, the results are the same: lost business, lost customers and lost reputations. Fuller says much of the data loss occurring today is a result of internal leakage. To minimize the risk, companies are increasingly turning to data leakage protection (DLP) solutions. A DLP system allows companies to monitor and detect unauthorized transmissions of data through e-mails, instant messages and Web traffic, as well as data stored on local and USB drives and sent to a printer or fax machine. “It scans for any data leakage rules that you set up for your company,” Fuller says.

Compliance and Best Practices

Government and industry regulations require many organizations to adopt data security measures regarding the use of personal information. They also mandate significant penalties if and when a breach occurs. The legal standards that apply generally depend on the industry involved. For instance, the Health Information Portability and Accountability Act (HIPAA) regulates the use of private information in the health care industry. The Sarbanes-Oxley Act of 2002 prescribes specific mandates for financial reporting, and the Gramm-Leach-Bliley Act applies to the banking industry. The Payment Card Industry Data Security Standard (PCI DSS) stipulates requirements for businesses that store, process or transmit payment cardholder data. Alaska Communication, for example, adheres to PCI DSS and various best practices. “If you look at our network, our customers’ credit card information is some of the most secure that we have in the

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company. The number of locked doors that we have to open (to access information) and who’s allowed to open those doors is something that’s held with highest levels of security,” Girten says. Alaska Communications uses encryption, tamper-resistant digital certificates and other practices to protect data. For its popular online payment option, the company “hides” and “splits up” customers’ information to thwart would-be hackers. A similar level of precaution was used last year when Alaska Communications moved its wireless customers’ credit card information to a new billing system. “When we did those moves and how we did them was a closely guarded secret,” Girten says.

Macintosh devices, like the popular iPhones and iPads, are also harder to manage and secure, says TekMate’s Fuller. Mac devices aren’t well integrated in company networks. These devices cannot be wiped out remotely once an employee leaves the company, which can put a company’s information at risk. Alaska Communications is less concerned about the type of mobile device being used than the kind of data being accessed. Publicly available information like calling plans and pricing is generally available to employees through mobile devices, Girten says. Access to proprietary information is normally restricted to select individuals and through company-issued devices.

Mobile Devices Pose Higher Risk

A number of digital security trends are taking place among businesses in Alaska and elsewhere. As employees and customers demand access to real-time information, organizations are looking at IT more strategically, according to Ketrenos of Structured Communication. They’re also changing their approach to digital security. Companies are reducing their security risk through the centralization and virtualization of information. Businesses want to provide access to data in a ubiquitous fashion, Ketrenos says. So instead of having data sit on a mainframe, data center or an end user’s PC, they’re using “virtual” solutions to provide mobile or remote access to information. “With virtualization, users aren’t really accessing the server,” Ketrenos explains. “The application is running on the company’s data center, and the user’s mobile device is simply acting as a terminal that lets them view the information.” Alaska businesses are also taking a fundamental approach to analyzing risk. They’re also changing the way they view the perimeter of the network. “In the past, they felt that if they used a firewall, intrusion prevention technology and antivirus, they were secure,” Ketrenos says. “Today, people are looking at all the places where data is residing and being used, and that leads back to mobile devices. That information needs to be available to people who are located not just within the firewall environment.”

As organizations rely more on the Internet and mobile devices to transfer information to and from their network, they’re finding it increasingly harder to protect their valuable digital assets. Many employees are using their own personal devices for work, which potentially increases the risk. The most prevalent means of data loss is through the theft or loss of mobile devices such as laptops, smartphones and USB drives. Many smartphones and laptops have been lost or stolen from office buildings, airports and even employees’ homes. Clark of DenaliTEK says many companies are not adequately addressing security around the use of mobile devices. These devices, much like wireless access points, can be a serious security risk if not dealt with properly. “These devices can be used to hack into a corporate network or other entry points,” Clark says. But the apprehension around security goes beyond the possible loss of an employee’s smartphone, Clarks says. It also includes the breach of information through Bluetooth technology, which allows the wireless transmission of data over short distances. Bluetooth mobile phones can be the target of “bluebugging” and “bluesnarfing” schemes designed to steal customers’ phone numbers, contact names and other personal information.

Security Trends

www.akbizmag.com • Alaska Business Monthly • April 2011


Security Strategies and Solutions

The key to effective data security, Ketrenos says, is assessment and understanding. He encourages companies to hire an expert to evaluate how they’re using information in their business and to secure appropriate processes and technology to ensure the availability, integrity and confidentiality of their information. Structured Communication offers a variety of security assessments to help customers identify their security risks and exposure. For large companies, the evaluation could be complex; for smaller ones it could amount to a few enlightening questions. These types of assessments are vital for any size business, Ketrenos says. “If you lose customer’s information, you might be out of business,” he says. “I think every business needs to take appropriate measures to address their risk.” Like Ketrenos, Clark also advises companies to invest in using outside expertise to disclose their vulnerabilities. This could range from having someone take a cursory look to a fullblown security plan. DenaliTEK offers a host of IT solutions, including risk assessments, compliance analysis, and network design, implementation and support. The company also provides cloud-based solutions to give clients reliable and secure networked e-mail, file storage, sharing, communications and desktop management without the use of on-site servers. TekMate, which is an Alaska Communications partner, also offers a range of services to address organizations’ security needs. It can provide the appropriate intrusion protection systems to help clients’ detect information security breaches and other threats. TekMate can also implement firewall services and ensure they’re properly updated. “It’s very important that the software solutions they have running on their desktop and mobile devices are up to date,” Fuller says. “If they’re not, those are known holes that will allow people to get into their data.” Businesses lacking the time or expertise to keep up with their IT requirements can opt for TekMate’s Constantly On IT service. “We manage everything,” Fuller says. “We become their full IT operation.”  q

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www.akbizmag.com • Alaska Business Monthly • April 2011

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ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100

Champions of Industry

Power ~ Performance ~ Productivity

Tank or Thrive? Corporate 100 Leaders Key to Survival

O

K, I’ll admit it. I’m scared. I’m afraid our economy will tank if we don’t do more in the way of oil and gas exploration. I’m afraid environmentalists will stop development of major job-producing projects that benefit the state as a whole as well as individuals in the regions where work is ongoing or potential work planned. And I’m afraid Alaska will not recover and we will be taxed to death, lose our dividends and do without vital services and growth opportunities. But then I look at a list like the Corporate 100 and see many Champions of Industry, those that show Power, Performance and Productivity. They are good corporate citizens, employ thousands upon thousands of individuals, and provide much benefit to the state. And I think: Diversification. And I think: We can do it! One thing Alaska has always had is backbone, forward thinking and ability to change. We’ve been through our own recession, but now remain independent and strong despite the economic horrors of the Lower 48. Let’s face it, with brainpower like executives in these top companies display, maybe we can change Alaska. As I write this, oil is more than $100 a barrel, mainly due to conflicts in the Middle East and Northern Africa. Money is chingchinging into the state. But we are running out of oil. As I write this, Native corporations are doing well, getting 8(a) contracts that help them diversify and grow and become independent of SBA contracts. But that too is in flux. But I’m counting on leaders like those who head the Corporate 100 companies on this list to change the state. The ball is in their court, and ours. It’s for all of us who care about the economic conditions to bring forth new ideas, new industry, new tax laws, new …. Let’s seize the opportunity. – Debbie Cutler Managing Editor

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www.alaskachamber.com 72

Bill Brackin, ExxonMobil - Alaska Public & Government Affairs Manager

The Alaska State Chamber is an invaluable institution that fosters dialogue and cooperation between Alaskan businesses and policymakers. ExxonMobil is proud to be a partner with the Chamber and to help the organization promote a positive business environment in Alaska. – Bill Brackin

www.akbizmag.com • Alaska Business Monthly • April 2011


We’re putting up some

big numbers

4,000,000 It’s great to celebrate accomplishments and at the Fort Knox Gold Mine we are doing just that. As of the end of January, we achieved 4,000,000 man hours worked without a lost-time incident. Big numbers like that don’t come easy in our business, where moving tons and tons of material and operating complex machinery are everyday assignments. Our 4,000,000 milestone comes from a workforce that is committed to working safely, and embracing the procedures and policies that make it happen. Our safety culture asks workers to look after one another, as well as themselves. As our incident-free record demonstrates, it’s helping prevent accidents and injuries on the job. Our 500 dedicated Fort Knox employees deserve to celebrate. Our team has set a new Alaska record for incidentfree operations at a large metal mine. That big number reflects their shared commitment to working safer and to working smarter each and every day. And, with that kind of attitude, the next big accomplishment could be right around the corner.

kinross.com www.akbizmag.com • Alaska Business Monthly • April 2011

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ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100

Champions of Industry

Power ~ Performance ~ Productivity

2011 CORPORATE 100 Listed by Industry Construction Alaska Interstate Construction LLC Davis Constructors & Engineers Inc. Granite Construction Co. Neeser Construction Inc. Osborne Construction Co. Roger Hickel Contracting Inc. UNIT Company Watterson Construction Co. PCL Construction Services Inc. Finance, Insurance, Real Estate Alaska Housing Finance Corp. Alaska USA Federal Credit Union Credit Union 1 Denali Alaskan Federal Credit Union First National Bank Alaska KeyBank Mt McKinley Bank Prudential Jack White/Vista Real Estate Wells Fargo Bank, N.A. Health Care Alaska Regional Hospital Fairbanks Memorial Hospital Mat-Su Regional Medical Center Providence Health + Services Alaska Industrial Services Alaska Ship & Drydock ASRC Energy Services Inc. CH2M Hill Colville Inc. Construction Machinery Industrial Cruz Construction Inc. Jacobs Engineering Group Schlumberger Oilfield Services Udelhoven Oilfield System Service USKH Inc. Peak Oilfield Service Co. PND Engineers Inc.

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Mining Anchorage Sand & Gravel Coeur Alaska Inc. Fairbanks Gold Mining Inc. Usibelli Coal Mine Inc. Native Organization Afognak Native Corp./Alutiiq Ahtna Inc. Arctic Slope Regional Corporation Bering Straits Native Corporation Bethel Native Corporation Calista Corporation Chenega Corporation Chugach Alaska Corporation Cook Inlet Region Inc. Doyon Limited Koniag Inc. NANA Regional Corporation Olgoonik Corporation Sealaska Corporation The Aleut Corporation The Kuskokwim Corporation The Tatitlek Corporation Ukpeagvik Inupiat Corporation Oil & Gas Alyeska Pipeline Service Co. BP Exploration (Alaska) Inc. Chevron ConocoPhillips Alaska Inc. Flint Hills Resources Alaska LLC Marathon Oil Corporation Nabors Alaska Drilling Inc. XTO Energy Inc. Retail/Wholesale Trade Alaska Commercial Co. Alaska Industrial Hardware Inc. Anchorage Chrysler Dodge Center Cal Worthington Ford of Alaska Carrs Safeway

Retail/Wholesale Trade cont. Costco Wholesale Corp. Spenard Builders Supply Inc. The Odom Corp. Telecommunications Alaska Communications AT&T GCI MTA Inc. TelAlaska Transportation Alaska Airlines Alaska Railroad Corp. American Fast Freight Inc. Carlile Transportation Systems Crowley Era Helicopters LLC Everts Air Cargo FedEx Express Horizon Lines HoTH Inc. dba Era Alaska Lynden Inc. Northland Services Inc. Pacific Alaska Freightways Inc. Ryan Air Inc. Span-Alaska Transportation Inc. Totem Ocean Trailer Express Travel & Tourism Alyeska Resort Hotel Captain Cook USTravel Utility Chugach Electric Association Inc. Golden Valley Electric Association Homer Electric Association Inc. Matanuska Electric Association Inc.

www.akbizmag.com • Alaska Business Monthly • April 2011


ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 Afognak Native Corp./Alutiiq Afognak 215 MissionNative Rd., Ste.Corp./Alutiiq 212 215 Mission Rd., Ste. 212 Kodiak, AK 99503 Kodiak, 99503 Phone: AK 907-486-6014 Phone: 907-486-6014 Fax: 907-486-2514 Fax: 907-486-2514 info@alutiiq.com info@alutiiq.com www.afognak.com www.afognak.com Top Executive Top Executive Richard Hobbs, Pres./CEO Richard Hobbs, Pres./CEO

Ahtna Inc. Ahtna Inc. PO Box 649

PO Box 649AK 99588 Glennallen, Glennallen, AK 99588 Phone: 907-822-3476 Phone: 907-822-3476 Fax: 907-822-3495 Fax: 907-822-3495 bhunt@ahtna.net bhunt@ahtna.net www.ahtna-inc.com www.ahtna-inc.com Top Executive Top Executive Ken Johns, Pres./CEO Ken Johns, Pres./CEO

Alaska Airlines Alaska Airlines 4750 Old Int'l Airport Rd.

Parent Company Parent Company Alaska Air Group Alaska Inc. Air Group Inc. Seattle, WA Seattle, WA Stock Symbol Stock ALK Symbol ALK

4750 Old Int'lAKAirport Anchorage, 99502Rd. Anchorage, AK 99502 Phone: 907-266-7230 Phone: 907-266-7230 Fax: 907-266-7229 Fax: 907-266-7229 www.alaskaair.com www.alaskaair.com Top Executive Top Executive Bill MacKay, Sr. VP-Alaska Bill MacKay, Sr. VP-Alaska

Champions of Industry

Alaska Commercial Co. 550 W. 64th Ave. Anchorage, AK 99518 Phone: 907-273-4600 Fax: 907-273-4800 rwilhelm@northwest.ca alaskacommercial.com

Top Executive Rex Wilhelm, Pres./COO

Winnipeg, MB Canada Stock Symbol NWF.UN

Stock Symbol ALSK

Alaska Housing Finance Corp.

Top Executive Daniel Fauske, CEO/Exec. Dir.

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Business Type: Native Organization Business Type: Native Organization Business Description: Native Organization Business Description: Native Organization Community Involvement: Food drives, sponsorships, Community Involvement: Foodand drives, sponsorships, donations, community functions more. donations, community functions and more.

Year Founded: 1972 Year 1972 Estab.Founded: in Alaska: 1972 Estab. in Alaska: 1972 Employees Employees Alaska: 384 Alaska: 384 2,113 Worldwide: Worldwide: 2,113 Gross Revenue Gross Alaska:Revenue $251.00M Alaska: $251.00M Worldwide: $251.00M Worldwide: $251.00M

Business Type: Transportation Business Type: Transportation Business Description: Alaska Airlines and its sister carrier, Business Alaska Airlines and sister carrier, Horizon Air,Description: together provide passenger andits cargo service Horizon Air, together passenger cargoHawaii service to more than 90 citiesprovide in Alaska, Canada,and Mexico, to than 9048. cities in Alaska, Canada, Mexico, Hawaii andmore the Lower and the Lower 48. Community Involvement: Company leaders serve on Community Involvement: Companyincluding leaders serve on boards of a variety of organizations, the University boards of Foundation, a variety of organizations, including the Alaska University of Alaska Commonwealth North, the of AlaskaHeritage Foundation, Commonwealth North, the Alaska Aviation Museum, Alaska State Chamber and Aviation more. Heritage Museum, Alaska State Chamber and more.

Year Founded: 1932 Year 1932 Estab.Founded: in Alaska: 1932 Estab. in Alaska: 1932 Employees Employees Alaska: 1,788 Alaska: 1,788 Worldwide: 9,573 Worldwide: 9,573

Business Type: Retail/Wholesale Trade Parent Company The North West Co.

Top Executive Anand Vadapalli, Pres./CEO

PO Box 101020 Anchorage, AK 99510 Phone: 907-330-8447 Fax: 907-338-9218 ssimmond@ahfc.state.ak.us www.ahfc.state.ak.us

Year Founded: 1977 Year 1977 Estab.Founded: in Alaska: 1977 Estab. in Alaska: 1977 Employees Employees Alaska: 170 Alaska: 170 5,313 Worldwide: Worldwide: 5,313 Gross Revenue Gross Alaska:Revenue $33.13M Alaska: $33.13M Worldwide: $782.80M Worldwide: $782.80M

Power ~ Performance ~ Productivity

Alaska Communications

600 Telephone Ave. Anchorage, AK 99503 Phone: 907-297-3000 Fax: 907-297-3052 execoffice@acsalaska.com www.alaskacommunications.com

Business Type: Native Organization Business Type: Native Organization Business Description: Village Corporation Business Description: Village Corporation Community Involvement: Alutiiq Museum, Native Village of Community Involvement: Alutiiq Museum, Afognak, Junior Achievement of Alaska, PortNative Lions Village School,of Afognak, Junior Achievement of Alaska, Lions Special Olympics, Alaska Native Justice Port Center andSchool, more. Special Olympics, Alaska Native Justice Center and more.

Business Description: Largest rural retailer of merchandise and groceries in Alaska, including a wholesale division that sells groceries to more than 150 rural stores, and a meat-packing plant.

Juneau, AK

Employees Alaska: 850 Worldwide: 1,600

Community Involvement: Major sponsor of Girl Scouts of Alaska, ASAA, BBNC leadership workshop, Junior Achievement Alaska, Food Bank of Alaska, American Cancer Society and many other regional and local events.

Gross Revenue Alaska: $200.00M Worldwide: $460.00M

Business Type: Telecommunications

Year Founded: 1999 Estab. in Alaska: 1999

Business Description: Alaska Communications is a leading provider of high-speed wireless, mobile broadband, Internet, local, long-distance and advanced data solutions. Community Involvement: Through corporate contributions and employee volunteer work, we strive to improve the quality of life throughout Alaska.

Business Type: Finance, Insurance, Real Estate Parent Company State of Alaska

Year Founded: 1867 Estab. in Alaska: 1867

Business Description: Statewide self-supporting public corp. providing single- and multi-family financing, energy and weatherization programs, and low-income rental assistance. Community Involvement: Big Brothers/Big Sisters, United Way, Chamber of Commerce, Clean-up Day, Project Homeless Connect, StandDown, Paint the Town, Resource Development Council.

www.akbizmag.com • Alaska Business Monthly • April 2011

Employees Alaska: 813 Worldwide: 835 Gross Revenue Alaska: $341.52M

Year Founded: 1971 Estab. in Alaska: 1971 Employees Alaska: 310 Worldwide: 310 Gross Revenue Alaska: $397.30M Worldwide: $397.30M


www.akbizmag.com • Alaska Business Monthly • April 2011

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ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 Alaska Industrial Hardware Inc. 2192 Viking Dr. Anchorage, AK 99501 Phone: 907-276-7201 Fax: 907-258-3054 info@aihalaska.com www.aihalaska.com

Year Founded: 1959 Estab. in Alaska: 1959

Business Description: Retail, tools, hardware and construction supplies.

Employees Alaska: 183 Worldwide: 183

Community Involvement: United Way, Bean's Cafe, STAR, Boys and Girls Club, Alaska Fine Arts Academy, AKEELAHouse, North Star Hockey, AWAIC, Knik Little League, AFD Search & Rescue, AK Peace Officers, APD and more.

Top Executive Mike Kangas, Pres./Gen. Mgr.

Alaska Interstate Construction LLC

301 W. Northern Lights Blvd, Ste. 600 Anchorage, AK 99503 Phone: 907-562-2792 Fax: 907-562-4179 info@aicllc.com www.aicllc.com Top Executive Steve Percy, Pres.

Parent Company Cook Inlet Region Inc. Parent Company Nabors Industries Ltd. Hamilton Bermuda Stock Symbol NBR

Alaska Railroad Corp. PO Box 107500 Anchorage, AK 99510-7500 Phone: 907-265-2300 Fax: 907-265-2312 corpinfo@akrr.com www.alaskarailroad.com

Parent Company State of Alaska Juneau, AK

Top Executive Christopher Aadnesen, Pres./CEO

Champions of Industry

Business Type: Construction Business Description: AIC builds builds ice and snow roads, well-site pads, gravel roads and islands, bridges and culverts, structures, airstrips and helipads, dock and port facilities, pipeline installation and more.

Gross Revenue Alaska: $50.43M Worldwide: $50.43M

Year Founded: 1987 Estab. in Alaska: 1987 Employees Alaska: 400 Worldwide: 400

Community Involvement: AIC supports Boys and Girls Club of Alaska, Shriners Hospitals, Boy Scouts of America, Special Olympics, Scotty Gomez Foundation, United Way, Challenge Alaska and more.

Gross Revenue Alaska: $127.00M Worldwide: $127.00M

Business Type: Transportation

Year Founded: 1914 Estab. in Alaska: 1914

Business Description: Freight, passenger and real estate services.

Employees Alaska: 657 Worldwide: 657

Community Involvement: School Business Partnerships, Anchorage Downtown Partnership, member of all Railbelt chambers of commerce, member of Resource Development Council.

Gross Revenue Alaska: $167.00M Worldwide: $167.00M

Power ~ Performance ~ Productivity Business Type: Health Care

Alaska Regional Hospital 2801 DeBarr Rd. Anchorage, AK 99508 Phone: 907-276-1131 Fax: 907-264-1143 www.alaskaregional.com

Business Type: Retail/Wholesale Trade

Parent Company HCA Nashville, TN

Business Description: 24-hour ER department, Lifeflight Air Ambulance, cancer care center, neuroscience center, heart center and cardiac rehabilitation, diagnostic imaging, orthopedic and spine center, and more.

Top Executive Annie Holt, CEO

Community Involvement: Blood Bank of Alaska, Red Cross, American Heart Association, American Cancer Society, free immunization clinics, free community health fairs, and more.

Alaska Ship & Drydock

Business Type: Industrial Services

Year Founded: 1963 Estab. in Alaska: 1963 Employees Alaska: 950 Worldwide: 950

Year Founded: 1994 Estab. in Alaska: 1994

3810 Tongass Ave. Ketchikan, AK 99901 Phone: 907-228-5302 info@akship.com www.akship.net

Business Description: Formed in 1994 as a private cooperation, ASD's mission is to perform shipbuilding and repair in support of fleets operating in the Southeast Alaska Inside Passage, North Pacific and Bering Sea.

Top Executive Randy Johnson, Pres.

Community Involvement: ASD operates the Ketchikan Shipyard through a public private partnership with AIDEA, the Ketchikan Gateway Borough and the City of Ketchikan.

Gross Revenue Alaska: $25.00M Worldwide: $25.00M

Alaska USA Federal Credit Union

Business Type: Finance, Insurance, Real Estate

Year Founded: 1948 Estab. in Alaska: 1948

PO Box 196613 Anchorage, AK 99519 Phone: 907-563-4567 Fax: 907-561-4857 www.alaskausa.org

Top Executive William Eckhardt, Pres.

78

Business Description: Financial services. Community Involvement: Donated to more than 200 community/service organizations statewide. Helps raise money for the Alaska USA Foundation, providing funds for services for children, veterans, active duty military/families.

www.akbizmag.com • Alaska Business Monthly • April 2011

Employees Alaska: 120 Worldwide: 120

Employees Alaska: 1,326 Worldwide: 1,606 Gross Revenue Alaska: $41.85M Worldwide: $54.59M


ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 Alyeska Pipeline Service Co.

Business Type: Oil & Gas

PO Box 196660, MS 542 Anchorage, AK 99519-6660 Phone: 907-787-8700 Fax: 907-787-8240 alyeskamail@alyeska-pipeline.com www.alyeska-pipe.com

Business Description: Designed, built, operates and maintains the trans-Alaska oil pipeline, pump stations and Valdez Marine Terminal on behalf of five owner companies. Community Involvement: Contributes to nonprofit organizations and causes that support children and families. The company offers employee matching, volunteer gifts and more.

Top Executive Thomas Barrett, Pres.

Business Description: Alaska's premier year-round destination resort. The Hotel Alyeska has 304 guest rooms and 30,000 sq. ft. meeting and banquet space for up to 500. World-class skiing right from the hotel in winter.

PO Box 249 Girdwood, AK 99587 Phone: 907-754-1111 Fax: 907-754-2200 info@alyeskaresort.com alyeskaresort.com

Community Involvement: Support community organizations in Girdwood, Anchorage, Alaska and beyond. Contributes cash and in-kind services to more than a dozen local Girdwood nonprofits, Anchorage community schools and more.

Top Executive Mark Weakland, GM/VP

Year Founded: 1959 Estab. in Alaska: 1959 Employees Alaska: 500 Worldwide: 500

Business Type: Transportation

American Fast Freight Inc.

Top Executive Tim Jacobson, CEO

Employees Alaska: 735 Worldwide: 735

Business Type: Travel & Tourism

Alyeska Resort

7400 45th St. Ct. E. Fife, WA 98424 Phone: 253-926-5000 Fax: 253-926-5100 jacobsont@americanfast.com www.americanfast.com

Year Founded: 1970 Estab. in Alaska: 1970

Parent Company American Fast Freight Inc. Renton, WA

Business Description: Ocean/air freight, household moving and storage, project logistics, warehousing and distribution, cold storage, Alaska intrastate and Alcan trucking. Community Involvement: Great Alaska Shootout 2010 sponsor, Irondog 2011 sponsor, donated trailers to Food Bank of Alaska, Red Cross supporter, Alaska General Contractors sponsor.

www.akbizmag.com • Alaska Business Monthly • April 2011

Year Founded: 1988 Estab. in Alaska: 1988 Employees Alaska: 100 Worldwide: 325

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ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 Anchorage Chrysler Dodge Center 2601 E. Fifth Ave. Anchorage, AK 99501 Phone: 907-276-1331 Fax: 907-264-2202 anchoragechryslerdodge.com www.anchoragechrysler.com

Business Type: Retail/Wholesale Trade

Year Founded: 1963 Estab. in Alaska: 1963

Business Description: New and used auto sales, service and parts sales.

Employees Alaska: 95 Worldwide: 95

Community Involvement: Boys & Girls Club, Iditarod Race, Fur Rendezvous, Aces, Intervention Help Line, Alaska Raceway Park, Downtown Partnership, Boy Scouts of America and more.

Top Executive Rodney Udd, Pres./CEO

Gross Revenue Alaska: $52.30M Worldwide: $52.30M

Anchorage Sand & Gravel 1040 O'Malley Rd. Anchorage, AK 99515 Phone: 907-349-3333 Fax: 907-344-2844 anchsand@anchsand.com www.anchsand.com

Business Type: Mining Business Description: Building material supplier.

Top Executive Dale Morman, Pres.

Arctic Slope Regional Corporation PO Box 129 Barrow, AK 99723 Phone: 907-852-8633 Fax: 907-852-5733 www.asrc.com

Top Executive Rex Rock Sr., Pres./CEO

Champions of Industry

Barrow, AK

AT&T

505 E. Bluff Dr. Anchorage, AK 99501 Phone: 800-478-9000 Fax: 907-777-2564 alascominformation@alascom.att.com www.att.com/alaska Top Executive Mike Felix, Pres., AT&T Alaska

Bering Straits Native Corporation 4600 Debarr Rd. Ste., 200 Anchorage, AK 99508 Phone: 907-563-3788 Fax: 907-563-2742 info@beringstraits.com www.beringstraits.com Top Executive Gail Schubert, Pres./CEO

80

Employees Alaska: 150 Worldwide: 150

Business Type: Native Organization

Year Founded: 1972 Estab. in Alaska: 1972

Business Description: Energy services, petroleum refining & marketing, engineering, construction, government services, resource development, commercial lending, tourism and communications.

Employees Alaska: 4,483 Worldwide: 10,712

Community Involvement: North Slope specific and statewide nonprofit organizations.

Gross Revenue Alaska: $1.44B Worldwide: $2.33B

Business Type: Industrial Services Parent Company Arctic Slope Regional Corporation

Top Executive Jeff Kinneeveauk, Pres./CEO

Community Involvement: Business Partner with Alaska school districts.

Power ~ Performance ~ Productivity

ASRC Energy Services Inc. 3900 C St., Ste. 701 Anchorage, AK 99503 Phone: 907-339-6200 Fax: 907-339-6212 info@asrcenergy.com www.asrcenergy.com

Year Founded: 1938 Estab. in Alaska: 1938

Parent Company AT&T Dallas, TX Stock Symbol T

Business Description: AES offers expertise from the earliest regulatory stage to exploration, drilling support, engineering, fabrication, construction, project management, operations and maintenance and field abandonment. Community Involvement: Supporting and focusing on activities that promote a healthy community, AES volunteers, fundraises, and offers sponsorship to charitable, youth, educational, and cultural organizations.

Year Founded: 1985 Estab. in Alaska: 1985 Employees Alaska: 3,385 Worldwide: 4,698 Gross Revenue Alaska: $488.70M Worldwide: $655.00M

Business Type: Telecommunications Business Description: Solutions include wireless, longdistance, local, data, video and Internet services.service.

Year Founded: 1876 Estab. in Alaska: 1971

Community Involvement: Committed to advancing education, strengthening communities and improving lives. AT&T and AT&T Foundation philanthropic initiatives and partnerships support projects addressing community needs.

Employees Alaska: 500 Worldwide: 272,450

Business Type: Native Organization

Year Founded: 1972 Estab. in Alaska: 1972

Business Description: Government service contracts, construction, property management, IT, aerospace services, logistics, green energy, mining support and facilities O&M. Community Involvement: Supports Bering Straits Foundation, Alaska Federation of Natives, Inuit Circumpolar Council-AK, NACTEC, Scotty Gomez Foundation and local organizations.

www.akbizmag.com • Alaska Business Monthly • April 2011

Employees Alaska: 588 Worldwide: 1,186 Gross Revenue Alaska: $54.00M Worldwide: $136.00M


ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 Business Type: Native Organization

Bethel Native Corporation PO Box 719 Bethel, AK 99559 Phone: 907-543-2124 Fax: 907-543-2897 ahoffman@bnc-alaska.com www.bnc-alaska.com

Business Description: BNC delivers a broad range of services including project management, construction, real estate investment, telecom, environmental design, demolition/abatement and logistics support services. Community Involvement: Bethel Native Corporation, through vendor and employment opportunities, actively fosters an environment of inclusion and participation in the many communities in which we perform our services.

Top Executive Anastasia Hoffman, Pres./CEO

BP Exploration (Alaska) Inc. PO Box 196612 Anchorage, AK 99515-6612 Phone: 907-561-5111 Fax: 907-564-4124 www.alaska.bp.com Top Executive John MingŽ, Regional Pres.

Parent Company BP PLC London England Stock Symbol NYSE: BP

Cal Worthington Ford of Alaska 1950 Gambell St. Anchorage, AK 99501 Phone: 907-276-5300 Fax: 907-278-8172 www.calworthingtonford.com Top Executive Deanna Slack, Gen. Mgr.

Carlsbad, CA

Employees Alaska: 80 Worldwide: 100 Gross Revenue Alaska: $50.30M Worldwide: $95.00M

Business Type: Oil & Gas Business Description: Alaska oil and gas exploration and production. BP spent more than $1.9 billion with Alaska companies in 2009. Community Involvement: BP and its employees support more than 700 education, youth and community service organizations in 49 different communities across Alaska.

Business Type: Retail/Wholesale Trade Parent Company Worthington Oil and Gas Corp.

Year Founded: 1973 Estab. in Alaska: 1973

Year Founded: 1959 Estab. in Alaska: 1959 Employees Alaska: 2,000 Worldwide: 2,000

Business Description: New and used car dealer.

Year Founded: 1977 Estab. in Alaska: 1977

Community Involvement: Boys and Girls Club, Covenant House, United Way, Anchorage Concert Association, Anchorage Baptist Temple, Pacific Northern Academy, United States Army.

Employees Alaska: 196 Worldwide: 320

www.akbizmag.com • Alaska Business Monthly • April 2011

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ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 Business Type: Native Organization

Calista Corporation

Business Description: Government contracting, remote and camp services, resource development, construction and engineering, real estate, publishing, advertising and media, heavy equipment sales-rental-service.

301 Calista Ct., Ste. A Anchorage, AK 99518-3028 Phone: 907-279-5516 Fax: 907-272-5060 calista@calistacorp.com www.calistacorp.com

Community Involvement: Involvement with AK Chamber, Anchorage Chamber, Resource Development Council, JR Achievement, AK Mining Association, KYUK radio, AK Native Heritage Center, Rotary, Boys and Girls Club & Girl Scouts.

Top Executive Andrew Guy, Pres./CEO

Carlile Transportation Systems 1800 E. First Ave. Anchorage, AK 99501-1833 Phone: 907-276-7797 Fax: 907-278-7301 pspittler@carlile.biz www.carlile.biz

Carrs Safeway

56 Debarr Rd., Ste. 100 Anchorage, AK 99504 Phone: 907-339-7704 Fax: 907-339-7793 www.safeway.com Top Executive Glenn Peterson, Anchorage Dist. Mgr.

82

Employees Alaska: 271 Worldwide: 1,160 Gross Revenue Alaska: $71.00M Worldwide: $234.00M

Business Type: Transportation

Year Founded: 1980 Estab. in Alaska: 1980

Business Description: Full-service transportation company.

Employees Alaska: 525 Worldwide: 675

Community Involvement: United Way, Food Bank of Alaska, Anchorage Opera, American Cancer Society, Boy Scouts of America, The Alliance, Boys/Girls Club, Big Brothers/Big Sisters, Bean's Cafe, Salvation Army and more.

Top Executive Linda Leary, Pres.

Year Founded: 1972 Estab. in Alaska: 1972

Gross Revenue Alaska: $131.10M Worldwide: $131.10M

Parent Company Safeway

Business Type: Retail/Wholesale Trade Business Description: Retail food, drug and fuel.

Year Founded: 1901 Estab. in Alaska: 1950

Pleasanton, CA

Community Involvement: Food Bank, breast and prostrate cancer, Great Alaska Shootout, Salvation Army, Providence Alaska Foundation, Armed Forces, YMCA, MDA, Easter Seals, ALPAR, UAA and more.

Employees Alaska: 3,450 Worldwide: 220,000

Stock Symbol NYSE: SWY

www.akbizmag.com • Alaska Business Monthly • April 2011


ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 Business Type: Industrial Services

CH2M Hill

949 E. 36th Ave., Ste. 500 Anchorage, AK 99508 Phone: 907-762-1500 Fax: 907-762-1600 Tom.Maloney@ch2m.com www.ch2mhill.com

Parent Company CH2M HILL Englewood, CO

Top Executive Thomas Maloney, Area Manager

Community Involvement: CH2M HILL reaches out in the community through employee volunteerism, Workforce Development and School Business Partnerships, supporting the community we live and work in.

Year Founded: 1946 Estab. in Alaska: 1964 Employees Alaska: 3,000 Worldwide: 23,000 Gross Revenue Alaska: $600.00M Worldwide: $6.00B

Business Type: Native Organization

Chenega Corporation

Business Description: Gov't contracting: Intel & operations support, security, technical & installation services, health care & environmental, professional services, light mfg. Commercial property and hotel management.

3000 C St., Ste. 301 Anchorage, AK 99503-3975 Phone: 907-277-5706 Fax: 907-277-5700 info@chenega.com www.chenega.com

Community Involvement: AK Fed. of Natives, AK Russian Orthodox Church, Chenega Heritage Inc., Chenega Future Inc. Wounded Warrior Project AK, AK Native Heritage Center, AK Vocational Technical Center, Chugach School Dist.

Top Executive Charles Totemoff, CEO/Pres.

Chevron

3800 Centerpoint Dr., Suite 100 Anchorage, AK 99503 Phone: 907-276-7600 Fax: 907-263-7904 www.chevron.com

Year Founded: 1974 Estab. in Alaska: 1974 Employees Alaska: 305 Worldwide: 5,350 Gross Revenue Alaska: $1.10B

Parent Company Chevron Corporation

Business Type: Oil & Gas Business Description: Oil and gas exploration and production. Presence in Cook Inlet since 1957.

Year Founded: 1879 Estab. in Alaska: 1957

San Ramon, CA

Community Involvement: Habitat for Humanity, United Way, Boys and Girls Clubs of America, The Arctic Slope Scholarship Fund, Alaska Health Fair, Multiple Sclerosis Society and others.

Employees Alaska: 300 Worldwide: 60,000

Stock Symbol CVX

Top Executive John Zager, Gen. Mgr.

g n i m Co ! Soon

Business Description: CH2M HILL is a full-service, engineering, construction and O&M serving AlaskaÕs energy, natural resources, transportation, facilities, environmental and utilities markets.

Birchwood Industrial Park

Master Plan

Gravel Extraction Industrially zoned 157 acres of prime real estate conveniently located off the Glenn Highway next to the Birchwood Airport. Rail spurs located next to the site make this property strategically located for easy movement of heavy equipment and construction materials. • Long-term lease opportunities • Lay-down storage yard • Office and warehouse leases

Visit us at: www.Eklutnainc.com An ANCSA village corporation developing the economic landscape of the Anchorage area www.akbizmag.com • Alaska Business Monthly • April 2011

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ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 Chugach Alaska Corporation

Business Type: Native Organization

3800 Centerpoint Dr., Ste. 601 Anchorage, AK 99503-4396 Phone: 907-563-8866 Fax: 907-563-8402 bwelty@chugach-ak.com www.chugach-ak.com

Business Description: Chugach Alaska Services Inc., a wholly owned subsidiary of CAC, provides commercial construction, personnel services, service commitment and safety. Community Involvement: United Way, Alaska Food Bank, American Heart Association, Special Olympics, March of Dimes and KNBA.

Top Executive Ed Herndon, CEO

Chugach Electric Association Inc.

5601 Electron Dr. Anchorage, AK 99518 Phone: 907-563-7494 Fax: 907-562-0027 info@chugachelectric.com www.chugachelectric.com

Coeur Alaska Inc.

3031 Clinton Dr., Ste. 202 Juneau, AK 99801 Phone: 907-523-3300 Fax: 907-523-3330 jtrigg@coeur.com www.KensingtonGold.com

Champions of Industry

Coeur d'Alene, ID

Community Involvement: Juneau and Alaska State Chambers of Commerce, Haines Chamber of Commerce, Alaska Miners Association, Big Brothers Big Sisters, Juneau Economic Development Council, Southeast Conference.

Employees Alaska: 188 Worldwide: 188

Power ~ Performance ~ Productivity Business Type: Industrial Services Business Description: Arctic full-service fuel logistic contractor, solid waste services and industrial supply, NAPA, True Value, VIPAR, offshore logistics. Community Involvement: Sponsors events for membership organizations, including Resource Development Council and the Alliance; sponsors Alaska Mineral and Energy Resources Education Foundation.

ConocoPhillips Alaska Inc.

5400 Homer Dr. Anchorage, AK 99518 Phone: 907-563-3822 Fax: 907-563-1381 www.cmiak.com

Top Executive Ken Gerondale, Pres./CEO

84

Gross Revenue Alaska: $258.30M Worldwide: $258.30M

Year Founded: 1987 Estab. in Alaska: 1987

Top Executive Eric Helzer, Pres./CEO

Construction Machinery Industrial

Employees Alaska: 313 Worldwide: 313

Business Description: Mining company.

Pouch 340012 Prudhoe Bay, AK 99734 Phone: 907-659-3189 Fax: 907-659-3190 info@colvilleinc.com www.colvilleinc.com

Top Executive Trond-Erik Johansen, Pres.

Business Description: Retail and wholesale electric service within the Railbelt.

Business Type: Mining

Colville Inc.

PO Box 100360 Anchorage, AK 99510 Phone: 907-276-1215 Fax: ok www.conocophillips.com

Year Founded: 1948 Estab. in Alaska: 1948

Parent Company Coeur d'Alene Mines Corp.

Stock Symbol CDE

Top Executive Guy Jeske, VP, US Operations

Employees Alaska: 737 Worldwide: 5,500

Business Type: Utility

Community Involvement: Various state chambers, AEDC, United Way, Resource Development Council, Commonwealth, BOMA and Association of General Contractors.

Top Executive Bradley Evans, CEO

Year Founded: 1971 Estab. in Alaska: 1971

Business Type: Oil & Gas Parent Company ConocoPhillips Inc. Houston, TX Stock Symbol COP

Business Description: Largest producer of oil and gas in Alaska, with major operations on Alaska's North Slope and in Cook Inlet. Community Involvement: Provides statewide support to almost every nonprofit sector, including education, environment, arts, health and social services, youth programs and public broadcasting.

Business Type: Industrial Services

Year Founded: 1981 Estab. in Alaska: 1981 Employees Alaska: 98 Worldwide: 98 Gross Revenue Alaska: $78.00M Worldwide: $78.00M

Year Founded: 1952 Estab. in Alaska: 1952 Employees Alaska: 1,000 Worldwide: 29,700 Gross Revenue Alaska: $7.50B Worldwide: $189.00B

Year Founded: 1985 Estab. in Alaska: 1985

Business Description: CMI sells, rents and services heavy equipment.

Employees Alaska: 96 Worldwide: 96

Community Involvement: Sponsors schools sports teams all over Alaska, involved in numerous fundraisers.

Gross Revenue Alaska: $90.00M Worldwide: $90.00M

www.akbizmag.com • Alaska Business Monthly • April 2011


ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 Cook Inlet Region Inc.

Business Type: Native Organization

2525 C St.., Ste. 500 Anchorage, AK 99509-3330 Phone: 907-274-8638 Fax: 907-279-8836 info@ciri.com www.ciri.com

Business Description: CIRI is one of 13 regional corporations established by the Alaska Native Claims Settlement Act of 1971 to benefit Alaska Natives in Cook Inlet region. Community Involvement: CIRI has a strong commitment to being a responsible corporate citizen is a major supporter of various charitable organizations and fundraising events.

Top Executive Margaret Brown, Pres./CEO

Costco Wholesale Corp. 4125 DeBarr Rd. Anchorage, AK 99508 Phone: 425-313-8100 customerservice@costco.com www.costco.com

Employees Alaska: 81 Worldwide: 81 Gross Revenue Alaska: $79.89M Worldwide: $79.89M

Business Type: Retail/Wholesale Trade Parent Company Costco Wholesale Corp. Issaquah, Wash. Stock Symbol COST

Top Executive James Sinegal, CEO

Year Founded: 1972 Estab. in Alaska: 1972

Credit Union 1

1941 Abbott Rd. Anchorage, AK 99507 Phone: 907-339-9485 Fax: 907-339-8522 service@cu1.org www.cu1.org Top Executive Leslie Ellis, Pres./CEO

Business Description: Operates a chain of cash and carry membership warehouses that sell high-quality, nationally branded and selected private label merchandise at low prices, and has more than 550 warehouses worldwide. Community Involvement: United Way, Children's Miracle Network, Children's Hospitals, business partners in area elementary schools, volunteers in Anchorage Literacy Project and other philanthropic endeavors.

Year Founded: 1976 Estab. in Alaska: 1984 Employees Alaska: 800 Worldwide: 200,000

Business Type: Finance, Insurance, Real Estate

Year Founded: 1952 Estab. in Alaska: 1952

Business Description: Full-service financial institution focused on providing excellent service, products and value. Specialized loan departments and real estate lending.

Employees Alaska: 277 Worldwide: 280

Community Involvement: CU1 embraces the credit union spirit of "people helping people" by volunteering, donating, educating and encouraging financial well-being.

Gross Revenue Alaska: $47.20M Worldwide: $47.20M

40 Years...

Thanks to our customers and employees, we’ve been privileged to serve Alaska’s oil industry for over 40 years. Our goal is to build a company that provides a service or builds a project to the complete satisfaction of its customers. We shall strive to be number one in reputation with our customers and our employees. We must perform safely. We must provide quality performance. We must make a profit. We shall share our successes and profits with our employees. Work can be taken away from us in many ways, but our reputation is ours to lose. Our reputation is the key that will open doors to new business in the future.

www.akbizmag.com • Alaska Business Monthly • April 2011

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ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 Crowley

201 Arctic Slope Ave. Anchorage, AK 99518 Phone: 907-777-5505 Fax: 907-777-5550 bob.cox@crowley.com www.crowley.com

Business Type: Transportation Parent Company Crowley Maritme Corporation Jacksonville, FL

Top Executive Bob Cox, VP

Business Description: Fuel distribution, marine services, tanker escort and spill response throughout Alaska.

Year Founded: 1892 Estab. in Alaska: 1953

Community Involvement: Crowley supports statewide events like the 2011 Iron Dog and AFN. In addition, we support youth and healthy lifestyle oriented activities in the communities where we do business.

Employees Alaska: 625 Worldwide: 4,200

Business Type: Industrial Services

Cruz Construction Inc. 7000 E. Palmer-Wasilla Hwy. Palmer, AK 99645 Phone: 907-746-3144 Fax: 907-746-5557 info@cruzconstruct.com www.cruzconstruct.com

Business Description: Remote Arctic projects, O&G exploration support, ice roads and pads, camps, portable shops, rig support, tundra transportation, heavy civil construction, airports, roads and logistics management.

Year Founded: 1989 Estab. in Alaska: 1989 Employees Alaska: 100 Worldwide: 145

Top Executive Dave Cruz, Pres.

Community Involvement: Academy Career and Tech Education, Eagle River Nature Center, Alaska Moose Federation, Habitat for Humanity, American Cancer Society, Iditarod and other local events.

Davis Constructors & Engineers Inc.

Business Type: Construction

Year Founded: 1976 Estab. in Alaska: 1976

Business Description: Commercial construction and design-build.

Employees Alaska: 130 Worldwide: 130

740 Bonanza Ave. Anchorage, AK 99518 Phone: 907-562-2336 Fax: 907-561-3620 admin@davisconstructors.com www.davisconstructors.com

Community Involvement: Employee Team Davis: American Cancer Society Relay for Life Nationwide Top 10 Fund Raiser. Employee Fund donations: Safe Harbor, Food Banks, Boys & Girls organizations and others.

Top Executive Josh Pepperd, Pres.

Gross Revenue Alaska: $120.00M Worldwide: $120.00M

Your Path to Mobility Dr. Tim Kavanaugh & Dr. Brian Carino SERVICES OFFERED u u u u u u u u

Injections Total knee replacement Total hip replacement Total shoulder replacement Joint revision surgery of the knee and hip Arthroscopic surgery of the knee Arthroscopic surgery of the shoulder General orthopedics

Our staff is dedicated to providing the highest quality orthopedic care and treatment of patients.

www.akboneandjoint.com 907-334-6788

86

u 2741 Debarr Road, Suite C210

u Anchorage, AK 99508

www.akbizmag.com • Alaska Business Monthly • April 2011


ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 Denali Alaskan Federal Credit Union

Business Type: Finance, Insurance, Real Estate

440 E. 36th Ave. Anchorage, AK 99503 Phone: 907-257-7200 Fax: 907-222-5806 info@denalifcu.com www.denalifcu.org

Business Description: Complete financial services center for Alaskans. Community Involvement: Financial education presentations to local groups & schools. Donations committee supports more than 40 groups throughout Alaska.

Top Executive Robert Teachworth, Pres./CEO

Business Type: Native Organization

Doyon Limited

One Doyon Pl., Ste. 300 Fairbanks, AK 99701-2941 Phone: 907-459-2000 Fax: 907-459-2060 info@doyon.com www.doyon.com

Business Description: Oilfield services, drilling/pipeline infrastructure construction, gov't services, security, utility mgmt., natural resources development, remote site support, construction, engineering and tourism.

Top Executive Norman Phillips, Pres./CEO

Era Helicopters LLC

6160 Carl Brady Dr., Hangar 2 Anchorage, AK 99502 Phone: 907-550-8600 Fax: 907-550-8608 alaskamarketing@erahelicopters.com www.erahelicopters.com Top Executive W. Randy Orr, VP

Parent Company SEACOR Holdings Inc. Fort Lauderdale, FL Stock Symbol CKH

Year Founded: 1948 Estab. in Alaska: 1948 Employees Alaska: 300 Worldwide: 300 Gross Revenue Alaska: $44.80M Worldwide: $44.80M

Year Founded: 1972 Estab. in Alaska: 1972 Employees Alaska: 1,284 Worldwide: 2,389

Community Involvement: Fairbanks Chamber of Commerce, Anchorage Convention & Visitors Bureau, Alaska Federation of Natives and various civic and charitable groups.

Gross Revenue Alaska: $292.93M Worldwide: $458.60M

Business Type: Transportation

Year Founded: 1948 Estab. in Alaska: 1949

Business Description: Alaska's original helicopter company, safely flying customers since 1948. Offering charter service, O&G support for North Slope and Cook Inlet, and flightseeing tours in Juneau and Denali Nat'l Park. Community Involvement: Work with the Anchorage and Juneau Convention and Visitors Bureaus for various functions as well as the Anchorage Chamber of Commerce.

Employees Alaska: 111 Worldwide: 792 Gross Revenue Alaska: $34.50M Worldwide: $235.00M

An Alaska Native Corporation

Proven Performance, Grounded in our Values, Dedicated to the Future for our People www.chenega.com

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ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 Everts Air Cargo

6111 Lockheed Ave. Anchorage, AK 99502 Phone: 907-243-0009 Fax: 907-243-7333 info@evertsair.com www.evertsair.com

Business Type: Transportation

Year Founded: 1995 Estab. in Alaska: 1995

Parent Company Tatonduk Outfitters Ltd.

Business Description: Air Cargo transportation within Alaska, including scheduled and charter flights. On demand 121 passenger charter service using Embraer 120, 30 seat aircraft.

Fairbanks, Alaska

Community Involvement: Local and village community events, Backhaul Recycling Program, Iditarod, Iron Dog and Sprint team sponsor.

Gross Revenue Alaska: $46.80M Worldwide: $46.80M

Parent Company Kinross Gold Corp.

Business Type: Mining

Toronto, Ontario

Business Description: Gold producer.

Year Founded: 1992 Estab. in Alaska: 1995

Top Executive Robert Everts, Owner

Employees Alaska: 283 Worldwide: 283

Fairbanks Gold Mining Inc. PO Box 73726 Fairbanks, AK 99707 Phone: 907-488-4653 Fax: 907-490-2290 info@kinross.com www.kinross.com

Top Executive Lauren Roberts, VP/Gen. Mgr.

Stock Symbol KGC

Fairbanks Memorial Hospital

1650 Cowles St. Fairbanks, AK 99701 Phone: 907-452-8181 Fax: 907-458-5324 shelby.nelson@bannerhealth.com www.fmhdc.com Top Executive Mike Powers, CEO

Employees Alaska: 500 Worldwide: 5,000

Community Involvement: Donations, volunteer time, electric rate reduction.

Business Type: Health Care Parent Company Banner Health Systems

Business Description: General medical and surgical hospital, home care, mental health, cancer center, pain clinic, imaging center, sleep disorders lab, diabetes center, rehabilitation, long-term care and cardiology.

Phoenix, AZ

Community Involvement: Partners with United Way and American Heart Association. Works with community groups to better address alcohol and drug abuse issues.

Year Founded: 1972 Estab. in Alaska: 1972 Employees Alaska: 1,400 Worldwide: 1,400

Serving Alaska with pride and environmental stewardship for more than 50 years.

Our strength comes from our people. Experience. Trust. Dedication. Commitment. These continue to be our most important assets. www.horizonlines.com

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877.678.7447

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ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 FedEx Express

Parent Company FedEx Corp.

6050 Rockwell Ave. Anchorage, AK 99502 Phone: 800-463-3339 Fax: 907-249-3178 www.fedex.com

Memphis, TN Stock Symbol FDX

Top Executive Connie Carter, Managing Director

First National Bank Alaska PO Box 100720 Anchorage, AK 99510-0720 Phone: 907-777-3409 Fax: 907-777-3406 marketing@FNBAaska.com FNBAlaska.com

Parent Company First National Bank Alaska Anchorage, AK Stock Symbol FBAK

Top Executive DH Cuddy, Chairman/Pres.

Flint Hills Resources Alaska LLC 1100 H&H Ln. North Pole, AK 99705 Phone: 907-488-2741 Fax: 907-488-0074 jeff.cook@kochps.com www.fhr.com Top Executive Mike Brose, VP

Business Type: Transportation Business Description: Air cargo and express-package services.

Year Founded: 1988 Estab. in Alaska: 1988

Community Involvement: Anchorage Chamber of Commerce member, United Way, March of Dimes and MS 150 corporate sponsor. Big Brothers & Big Sisters annual plane pull event and fundraiser.

Employees Alaska: 1,650 Worldwide: 275,000

Business Type: Finance, Insurance, Real Estate

Year Founded: 1922 Estab. in Alaska: 1922

Business Description: First National Bank Alaska is a fullservice commercial bank serving Alaskans with a broad range of deposit and lending services, trust and investment management services and Internet banking. Community Involvement: More than $2.7 million in contributions, including donations, sponsorships, low income housing investments and in-kind donations were given in Alaska.

Business Type: Oil & Gas Parent Company Koch Industries Inc.

Business Description: Refiner and distributor of gasoline, diesel, jet fuel and asphalt.

Wichita, KS

Community Involvement: University of Alaska, Boys and Girls Club, Big Brothers/Big Sisters, school and business partnership and The Museum of the North.

www.akbizmag.com • Alaska Business Monthly • April 2011

Employees Alaska: 696 Worldwide: 696 Gross Revenue Alaska: $150.93M Worldwide: $150.93M

Year Founded: 1977 Estab. in Alaska: 2004 Employees Alaska: 175 Worldwide: 70,000

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ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 Business Type: Telecommunications

GCI

2550 Denali St., Ste. 1000 Anchorage, AK 99503 Phone: 907-265-5600 Fax: 907-868-5676 www.gci.com

Stock Symbol GNCMA

Business Description: Integrated communications provider offering facilities-based local and long distance telephone services, Internet and cableTV services, statewide cellular/ wireless service, data, tele-health and more.

Top Executive Ron Duncan, CEO

Community Involvement: Iditarod, Alaska Academic Decathlon, Greater Anchorage, Inc., United Way, Providence Cancer Center and more.

Golden Valley Electric Association

Business Type: Utility

PO Box 71249 Fairbanks, AK 99707-1249 Phone: 907-452-1151 Fax: 907-458-6368 info@gvea.com www.gvea.com

Employees Alaska: 1,648 Worldwide: 1,723

Year Founded: 1946 Estab. in Alaska: 1946

Business Description: Generates and distributes electricity. Community Involvement: $21,000 in academic scholarships awarded, United Way contributions exceeding $51,000. Cell Phones for Soldiers program participant.

Top Executive Brian Newton, Pres./CEO

Year Founded: 1979 Estab. in Alaska: 1979

Employees Alaska: 253 Worldwide: 253 Gross Revenue Alaska: $219.11M Worldwide: $219.11M

Business Type: Construction

Granite Construction Co.

Parent Company Granite Construction Inc.

11471 Lang St. Anchorage, AK 99515 Phone: 907-344-2593 Fax: 907-522-1270 info@gcinc.com www.graniteconstruction.com

Watsonville, CA Stock Symbol GVA

Top Executive Joe Spink, Regional Mgr.

Business Description: Public and private heavy civil and design-build, construction aggregates, recycled base, warm and hot mix asphalt, road construction, bridges, piling, and sitework. Community Involvement: Rotary, sports teams sponsorships, Chamber of Commerce, Associated General Contractors education program, Resource Development Council, Alaska Miners Association, Nordic Ski Association of Anchorage.

Year Founded: 1922 Estab. in Alaska: 1974 Employees Alaska: 52 Worldwide: 5,000

“After all the years we’ve shared,

KSKA, KAKM, and APRN continue to contribute to our quality of life every day. That’s why we plan to support it every year, and always will . . . even after we’re gone.”

Brooke & Pat Corkery

APTI Leadership Circle Visionaries and Legacy Circle Members

25th An niversar

y Dinner

For information on how you can become an APTI Visionary or join the Legacy Circle, please contact Kris Rognes at (907) 550-8435

90

Alaska Public Telecommunications, Inc 3877 University Dr Anchorage, AK 99508 kska.org · kakm.org · aprn.org

www.akbizmag.com • Alaska Business Monthly • April 2011


ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 Business Type: Utility

Homer Electric Association Inc.

Business Description: Member owned electric cooperative. Electric utility provider for most of the western Kenai Peninsula, from Sterling to Kachemak Bay.

3977 Lake St. Homer, AK 99603 Phone: 907-235-8551 Fax: 907-235-3313 www.homerelectric.com

Community Involvement: Leader in community involvement on the Kenai Peninsula. HEA employees are on the boards of nonprofit groups. Employees have taken on leadership roles in United Way, Relay for Life, Rotary and more.

Top Executive Brad Janorschke, Gen. Mgr.

Year Founded: 1945 Estab. in Alaska: 1945 Employees Alaska: 140 Worldwide: 140

Business Type: Transportation

Horizon Lines

Parent Company Horizon Lines Inc.

1717 Tidewater Road Anchorage, AK 99501-1036 Phone: 907-263-5606 Fax: 907-263-5620 www.horizonlines.com

Charlotte, NC

Top Executive Marion Davis, VP/Gen. Mgr., AK Div.

Stock Symbol HRZ

Hotel Captain Cook

Business Description: Containership service between Tacoma, WA, and Anchorage, Kodiak, Dutch Harbor, AK. Feeder barge service to Bristol Bay and the Pribilofs. Connecting carrier service to other water, air, land carriers. Community Involvement: Anchorage Chamber of Commerce, AK State Chamber of Commerce, Food Bank of AK, United Way, Covenant House, Armed Services YMCA of Alaska, Iditarod, Special Olympics AK

Business Type: Travel & Tourism

939 W. Fifth Ave. Anchorage, AK 99501-2019 Phone: 907-276-6000 Fax: 907-343-2298 info@captaincook.com www.captaincook.com

Business Description: Private athletic club, four restaurants, 10,000-bottle wine cellar, four-diamond dining, 547 rooms including 96 suites. Community Involvement: United Way, United States Coast Guard Foundation and Special Olympics Alaska.

Top Executive Walter Hickel Jr., Pres.

Year Founded: 1956 Estab. in Alaska: 1964 Employees Alaska: 285 Worldwide: 1,895 Worldwide: $1.16B

Year Founded: 1964 Estab. in Alaska: 1965 Employees Alaska: 316 Worldwide: 316

beringstraits.com

A solid Future

Bering Straits Native Corporation is honored to have won the largest construction contract in the region in recent years. Funded by the American Recovery and Reinvestment Act, BSNC formed subsidiary Inuit-NCI, Joint Venture with Neeser Construction to build a $90.4 million, state-of-the-art hospital to benefit our region through jobs and improved health care.

bering straits native corporation Nome (907) 443-5252 | Anchorage (907) 563-3788

We’re building our future one step at a time. W e ’ r e w o r k i n g t o b e n e f i t o u r s h a r e h o l d e r s o f t o d ay a n d t o m o r r o w.

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ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 HoTH Inc. dba Era Alaska 4200 Old Int'l Airport Rd. Anchorage, AK 99502 Phone: 907-266-8394 Fax: 907-266-8391 sales@flyera.com www.flyera.com

Business Type: Transportation Parent Company HoTH Inc.

Business Description: Scheduled passenger/cargo services. Air charter services.

Fairbanks, AK

Employees Alaska: 805 Worldwide: 805

Community Involvement: The success of Frontier Alaska is dependent upon the communities served.

Gross Revenue Alaska: $127.00M Worldwide: $127.00M

Business Type: Industrial Services

Year Founded: 1947 Estab. in Alaska: 1993

Top Executive Bob Hajdukovich, Pres./CEO

Jacobs Engineering Group

Parent Company Jacobs Engineering Group Inc.

4300 B St., Suite 600 Anchorage, AK 99503 Phone: 907-563-3322 Fax: 907-563-3320 www.jacobs.com

Pasadena, CA Stock Symbol JEC

Top Executive Terry Heikkila, Alaska Ops. Mgr.

KeyBank

101 W. Benson Blvd., Ste. 400 Anchorage, AK 99503 Phone: 907-562-6100 Fax: 907-564-0200 keyexpress@keybank.com www.key.com

Parent Company KeyCorp Cleveland, OH Stock Symbol KEY

Top Executive Brian Nerland, Alaska District Pres.

Champions of Industry

Business Description: Lending and deposit services for consumers and businesses of all sizes, mortage services, investment services, wealth management. Community Involvement: Significant investment in our communities through charitable organizations and economic development initiatives.

Community Involvement: Koniag Education Foundation, Alutiiq Museum, Gulf of Alaska Coastal Communications Coalition, Alaska Federation of Natives, Alaska Native Arts Foundation and more.

Lynden Inc.

Business Type: Transportation

6641 S. Airpark Pl. Anchorage, AK 99502 Phone: 907-245-1544 Fax: 907-245-1744 information@lynden.com www.lynden.com

Business Description: Multi-modal Transportation and Logistics. Community Involvement: Red Cross of Alaska, Alaska Aviation Heritage Museum,Jr. Iditarod, Armed Services YMCA, Food Bank of Alaska, Big Brothers/Big Sisters, Alzheimers Resource of Alaska and United Way of Alaska.

Top Executive Jim Jansen, CEO

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Business Type: Finance, Insurance, Real Estate

Business Description: Gov't contracting, construction design/mgmt., fluid reprocessing, environmental services, control systems/alloy distrib., security contracting, info sciences, database engineering, telecom software.

Top Executive William Anderson Jr., Pres./CEO

Top Executive Carri Lockhart, Production Mgr.-AK

Community Involvement: In 2010, employees donated items to wounded soldiers in Afghanistan, green beans to the Food Bank of Alaska, and gifts through the Angel Tree Program.

Business Type: Native Organization

194 Alimaq Dr. Kodiak, AK 99615 Phone: 907-486-2530 Fax: 907-486-3325 www.koniag.com

3201 C St. Anchorage, AK 99503 Phone: 907-561-5311 www.marathon.com

Business Description: Specialties include environmental compliance assessments, environmental remediation, energy conservation, design-build and Title II construction, and O&M.

Employees Alaska: 75 Worldwide: 50,000 Gross Revenue Alaska: $31.00M Worldwide: $10.00B

Year Founded: 1825 Estab. in Alaska: 1985 Employees Alaska: 126 Worldwide: 15,000 Worldwide: $4.42B

Power ~ Performance ~ Productivity

KONIAG Inc.

Marathon Oil Corporation

Year Founded: 1948 Estab. in Alaska: 1950

Parent Company Marathon Oil Corp. Houston, TX Stock Symbol MRO

Business Type: Oil & Gas Business Description: Marathon ranks as one of the largest natural gas producers in Southcentral Alaska along the Kenai Peninsula. Community Involvement: At Marathon, philanthropy is an integral part of our business and an investment in communities where we live and work.

www.akbizmag.com • Alaska Business Monthly • April 2011

Year Founded: 1971 Estab. in Alaska: 1972 Employees Alaska: 70 Worldwide: 850 Gross Revenue Alaska: $149.55M Worldwide: $149.55M

Year Founded: 1954 Estab. in Alaska: 1954 Employees Alaska: 700 Worldwide: 2,198 Worldwide: $720.00M

Year Founded: 1887 Estab. in Alaska: 1954 Employees Alaska: 70 Worldwide: 29,000 Worldwide: $73.62B


ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 Mat-Su Regional Medical Center PO Box 1687 Palmer, AK 99645 Phone: 907-861-6000 Fax: 907-861-6559 k.aguirre@msrmc.com www.matsuregional.com Top Executive John Lee, CEO

Matanuska Electric Association Inc. 163 E. Industrial Way Palmer, AK 99645 Phone: 907-745-3231 Fax: 907-761-9368 contact@matanuska.com www.mea.coop Top Executive Joe Griffith, Gen. Mgr.

Parent Company Community Health Systems Nashville, TN Stock Symbol CYH

Business Type: Health Care Business Description: A progressive, 74-bed, acute-care hospital offering a full range of health services for the MatSu Valley and surrounding communities. Community Involvement: Free health education and screenings, donations to local charities, classroom space to health-focused support groups. Since doors opened in 2006: Welcomed 3,689 newborns and admitted 20,927 patients.

Year Founded: 1935 Estab. in Alaska: 1935 Employees Alaska: 657 Worldwide: 657

Business Type: Utility Business Description: Electric cooperative providing electric power distribution services.

Year Founded: 1941 Estab. in Alaska: 1941

Community Involvement: New roundup program with members rounding up their bills to the next dollar - money goes to those in need of financial assistance in our communities. Scholarships to members and their dependents.

Employees Alaska: 141 Worldwide: 141

Business Type: Finance, Insurance, Real Estate

Mt McKinley Bank

PO Box 73880 Fairbanks, AK 99707 Phone: 907-452-1751 Fax: 907-456-5982 branch@mtmckinleybank.com www.mtmckinleybank.com Top Executive Craig Ingham, Pres./CEO

Business Description: Full service community bank. All business lending including SBA and USDA guarantee programs. All mortgage lending programs including AHFC, FHA, VA and conventional. All types of consumer loans and commercial loans.

Year Founded: 1964 Estab. in Alaska: 1964

Community Involvement: Chamber of Commerce, local and state, all Rotary clubs, Habitat for Humanity, United Way of the Tanana Valley, numerous community sponsorships, significant contributor to community and charitable organizations.

Gross Revenue Alaska: $10.05M Worldwide: $10.05M

Employees Alaska: 80 Worldwide: 80

RESPONSIBLE DEVELOPMENT

Our people. Our land. Our companies.

Enriching our Native way of life.

Learn more. View Responsible Development, a video showcasing BBNC’s land and resource vision at www.bbnc.net.

www.akbizmag.com • Alaska Business Monthly • April 2011

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ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 Business Type: Telecommunications

MTA Inc.

Business Description: A communications cooperative that provides business and residential communications, digital TV, Internet, directory and TV advertising, wireless phones and accessories, and IT business support.

1740 S. Chugach Street Palmer, AK 99645 Phone: 907-745-3211 Fax: 907-761-2481 www.mtasolutions.com

Community Involvement: MTA believes in supporting the communities we serve by collaborating with various nonprofit organizations through sponsorships, donations and providing volunteers throughout Alaska.

Top Executive Greg Berberich, CEO

Nabors Alaska Drilling Inc. 2525 C Street, Suite 200 Anchorage, AK 99503 Phone: 907-263-6000 Fax: 907-563-3734 www.nabors.com

NANA Regional Corporation PO Box 49 Kotzebue, AK 99503 Phone: 907-442-3301 news@nana.com www.nana.com/regional

Top Executive Marie N. Greene, President/CEO

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Employees Alaska: 400 Worldwide: 400 Gross Revenue Alaska: $63.26M Worldwide: $63.26M

Parent Company Nabors Industries Ltd.

Business Type: Oil & Gas Business Description: Oil and gas well drilling.

Year Founded: 1964 Estab. in Alaska: 1964

Hamilton Bermuda

Community Involvement: United Way, Mable T. Caverly Senior Center, Dare to Care, Alaska School Activities Association, YMCA and Anchorage Crime Stoppers, Habitat for Humanity.

Employees Alaska: 328 Worldwide: 23,041

Business Type: Native Organization

Year Founded: 1972 Estab. in Alaska: 1972

Stock Symbol NBR

Top Executive Dennis Smith, Pres.

Year Founded: 1953 Estab. in Alaska: 1953

Business Description: NANA manages the surface and subsurface rights to more than 2.2 million acres of land in northwest Alaska to the benefit of more than 12,500 Inupiat. Community Involvement: NANA is a sponsor of the ANSEP program, the Aqqaluk Trust, WEIO, ASAA basketball tournament, United Way, and numersous statewide and regional events

www.akbizmag.com • Alaska Business Monthly • April 2011

Employees Alaska: 5,000 Worldwide: 13,000 Gross Revenue Alaska: $1.60B Worldwide: $1.60B


ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 Neeser Construction Inc. 2501 Blueberry Rd., Ste.100 Anchorage, AK 99503 Phone: 907-276-1058 Fax: 907-276-8533 jerry_neeser@neeserinc.com www.neeserinc.com Top Executive Jerry Neeser, Pres.

Northland Services Inc. PO Box 24527 Seattle, WA 98124 Phone: 206-763-3000 Fax: 206-767-5579 info@northlandservices.com www.northlandservices.com

Business Type: Construction

Year Founded: 1975 Estab. in Alaska: 1974

Business Description: General contracting firm.

Employees Alaska: 320 Worldwide: 325

Community Involvement: Healthy Alaska Natives Foundation, American Cancer Society, AWAIC, Food Bank of Alaska, Catholic Social Services, Armed Services, YMCA, Asian Alaskan Cultural Center, Salvation Army, United Way and many others.

Gross Revenue Alaska: $182.00M Worldwide: $183.00M

Business Type: Transportation Business Description: Marine transportation services to and from Alaska.

Year Founded: 1977 Estab. in Alaska: 1977

Top Executive Larry Stauffer, Pres./COO

Community Involvement: Sponsorship of Iditarod, Nome; the Golden North Salmon Derby, Southeast; Sockeye Classic, Western Alaska; Boys & Girls Club, Anchorage; Cystic Fibrosis Foundation; Multiple Sclerosis Society and more.

Employees Alaska: 103 Worldwide: 339

Olgoonik Corporation

Business Type: Native Organization

360 W. Benson Blvd., Ste. 302 Anchorage, AK 99503 Phone: 907-562-8728 Fax: 907-562-8751 info@olgoonik.com www.olgoonik.com Top Executive June Childress, Pres.

Business Description: Construction, environmental remediation, oilfield, logistics, facility management and technical security services worldwide Community Involvement: Olgoonik Corporation and its subsidiaries support community activities, promote continuing education and provide shareholder jobs and scholarships

www.akbizmag.com • Alaska Business Monthly • April 2011

Year Founded: 1973 Estab. in Alaska: 1973 Employees Alaska: 89 Worldwide: 514 Worldwide: $135.00M

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ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 Business Type: Construction

Osborne Construction Co.

Business Description: General contractor focusing on design-build, housing, civil, military, commercial and industrial. Selective work in private market. Alaska and worldwide employees include full and part time employees.

PO Box 97010 Kirkland, WA 98083 Phone: 425-827-4221 Fax: 425-828-4314 occ@osborne.cc osborne.cc

Community Involvement: ABC of Alaska, AGC of Alaska, Procurement Technical Assistance Centers of Alaska, youth hockey programs in Anchorage, American Heart Association, Arthritis Foundation, AK Peace Officers and others.

Top Executive George Osborne Jr., Pres.

Pacific Alaska Freightways Inc.

Year Founded: 1987 Estab. in Alaska: 1988 Employees Alaska: 199 Worldwide: 216 Gross Revenue Alaska: $115.60M Worldwide: $115.60M

Business Type: Transportation Business Description: Transports freight between the Lower 48 and Alaska. Trucking services in Alaska.

Year Founded: 1961 Estab. in Alaska: 1961

Top Executive Ed Fitzgerald, CEO

Community Involvement: Rotary, chambers of commerce, American Cancer Society, Special Olympics, youth sports programs, YMCA, Alaska food banks, Boy Scouts of America, youth scholarship funds, Boys & Girls Club and more.

Employees Alaska: 60 Worldwide: 120

PCL Construction Services Inc.

Business Type: Construction

Year Founded: 1903 Estab. in Alaska: 2005

Business Description: The PCL family of companies has a century-long tradition of excellence, hard work and a can-do attitude. They are construction leaders in buildings, civil infrastructure and heavy industrial markets.

Employees Alaska: 40 Worldwide: 9,800

Community Involvement: Food Bank of Alaska and United Way.

Gross Revenue Alaska: $27.86M Worldwide: $5.20B

431 E. 104th Ave. Anchorage, AK 99515 Phone: 907-336-2567 Fax: 907-336-1567 www.pafak.com

1400 W. Benson Blvd., Ste. 510 Anchorage, AK 99503 Phone: 907-243-7252 Fax: 907-272-1905 lpgire@pcl.com www.pcl.com

Parent Company PCL Constructors Inc. Edmonton, AB Candad

Top Executive H. Ivany, Construction Mgr.

©The Valdez Museum and Historical Archive

Our clients helped make us who we are today.

• Asset Based • Complete Lower 48 Coverage • Intra-State Alaska Service • Professional Drivers • Dedicated Customer Service • Comprehensive Web Services

www.pafak.com 800.426.9940 Anchorage 336.2567 Fairbanks 452.7971 Kenai 262.6137 Kodiak 486.8501

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ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 Peak Oilfield Service Co. 2525 C St. Anchorage, AK 99503 Phone: 907-263-7000 Fax: 907-263-7070 peak@peakalaska.com www.peakalaska.com

Business Type: Industrial Services Business Description: Oilfield general contracting, heavy civil construction, ice-road construction, crane support, drilling support, all-terrain vehicle transportation and remote camps, power generation and communication

Parent Company Cook Inlet Region Inc.

Community Involvement: United Way, The Alliance, Resource Development Council and various chamber of commerce groups.

Top Executive Mike O'Connor, Pres.

Business Type: Industrial Services

PND Engineers Inc.

Business Description: Civil, structural, marine, geotechnical, coastal, Arctic engineering, hydrology, survey, permitting, inspection, sanitary/waste water systems and more.

1506 W. 36th Ave. Anchorage, AK 99503 Phone: 907-561-1011 Fax: 907-563-4220 www.pndengineers.com Top Executive David Pierce, PE, Pres.

Community Involvement: Engineering (UAA), Boy Scouts of America, Boys and Girls Clubs, Catholic Social Services, Citywide Cleanup, Society of Women Engineers, United Way.

Providence Health + Services Alaska

Business Type: Health Care

3760 Piper St., Ste. 2021 Anchorage, AK 99508 Phone: 907-261-3145 Fax: 907-261-2038 info.phsa@providence.org www.providence.org/alaska

Business Description: The Sisters of Providence first brought health care to Nome in 1902 during the Gold Rush. Today, Providence serves Alaskans in five communities: Anchorage, Mat-Su, Kodiak, Seward and Valdez.

Parent Company Providence Health + Services

Community Involvement: At the heart of who we are is a deep commitment to the poor and vulnerable in our communities, from providing hot dinners for the homeless to advocating for better health care for the uninsured.

Seattle, WA

Top Executive Al Parrish, Chief Exec.

Year Founded: 1987 Estab. in Alaska: 1987 Employees Alaska: 500 Worldwide: 500

Year Founded: 1979 Estab. in Alaska: 1979 Employees Alaska: 72 Worldwide: 108 Gross Revenue Alaska: $23.50M Worldwide: $31.20M

Year Founded: 1902 Estab. in Alaska: 1902 Employees Alaska: 4,374 Worldwide: 4,374

Olgoonik team of companies delivers cost-effective, on-target solutions worldwide. The

n n n

Environmental Services Supply Chain Management Oilfield Services

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Construction Management Technical Security Facilities Management

907.562.8728 | olgoonik.com 11.10

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ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 Prudential Jack White/Vista Real Estate 3801 Centerpoint Dr., Ste. 200 Anchorage, AK 99503-3934 Phone: 907-562-6464 Fax: 907-562-5485 info@prudentialjackwhitevista.com www.prudentialjackwhitevista.com Top Executive Gregg Gunnarson, Pres.

Roger Hickel Contracting Inc.

11001 Calaska Cir. Anchorage, AK 99515 Phone: 907-279-1400 Fax: 907-279-1405 contact@rogerhicklecontracting.com www.rogerhickelcontracting.com Top Executive Mike Shaw, Pres.

Ryan Air Inc.

6400 Carl Brady Dr. Anchorage, AK 99502 Phone: 907-562-2227 Fax: 907-563-8177 ryan@ryanalaska.com www.ryanalaska.com Top Executive Wilfred Ryan, Pres.

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Business Type: Finance, Insurance, Real Estate Parent Company Vista Real Estate Inc.

Year Founded: 1977 Estab. in Alaska: 1977

Business Description: Real estate sales and leasing: residential, commercial and property management.

Anchorage, AK

Community Involvement: Charity fundraiser dinner for Sunshine Kids, spring and fall highway cleanup and United Way Day of Caring, United Way employee contributions.

Employees Alaska: 30 Worldwide: 30

Business Type: Construction Business Description: General contractor - commercial and road work. Community Involvement: YMCA board member, AGC of Alaska board member, United Way, Tocqueville Society, and financial support to many nonprofit organizations.

Business Type: Transportation Business Description: Air cargo, scheduled and charter operations, contract ground services and support. Community Involvement: We sponsor sports teams at the community level; dog-mushing event sponsors; we provide fundraising events in villages and volunteers.

www.akbizmag.com • Alaska Business Monthly • April 2011

Gross Revenue Alaska: $22.13M

Year Founded: 1995 Estab. in Alaska: 1995 Employees Alaska: 50 Worldwide: 50 Gross Revenue Alaska: $50.00M Worldwide: $50.00M

Year Founded: 1953 Estab. in Alaska: 1953 Employees Alaska: 93 Worldwide: 93


ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 Schlumberger Oilfield Services

Parent Company Schlumberger Ltd.

2525 Gambell St., Ste. 400 Anchorage, AK 99503 Phone: 907-273-1700 Fax: 907-561-8317 www.schlumberger.com

The Hague The Netherlands Stock Symbol SLB

Top Executive Lees Rodionov, Gen. Mgr.

Sealaska Corporation

Business Description: Provides people and technology, working together to offer exploration and production services during the life cycle of the oil and gas reservoir. Community Involvement: Active participants in oil and gas organizations, as well as long-term supporters of a variety of community programs, including Habitat for Humanity, United Way and School Business partnerships.

Business Type: Native Organization

One Sealaska Plaza, Ste. 400 Juneau, AK 99801-1276 Phone: 907-586-1512 Fax: 907-463-3897 webmaster@sealaska.com www.sealaska.com

Business Description: Forest products, silviculture/land mgmt., financial investments, plastics injection molding, fabrication, mfg., IT, logistics, security, environmental consulting, construction, aggregates, and more. Community Involvement: Celebration, culture and heritage, education, leadership development, nonprofits in the region, scholarships.

Top Executive Chris McNeil, Pres./CEO

Span-Alaska Transportation Inc. 2040 E. 79th Ave. Anchorage, AK 99507 Phone: 907-349-3606 Fax: 907-349-3601 kathyl@spanalaska.com www.spanalaska.com

Business Type: Industrial Services Year Founded: 1956 Estab. in Alaska: 1956 Employees Alaska: 450 Worldwide: 14,000

Year Founded: 1972 Estab. in Alaska: 1972 Employees Alaska: 580 Worldwide: 580 Gross Revenue Alaska: $201.01M Worldwide: $201.01M

Business Type: Transportation Parent Company Span-Alaska Transportation Inc.

Business Description: Freight transportation from all Lower 48 points to Alaska, less than truckload (LTL) and truckload. In-state overnight services from Anchorage to Fairbanks and the Kenai Peninsula.

Auburn, WA

Community Involvement: Annual supporter of Alaska food banks, Big Brothers/Big Sisters, AWAIC and Covenant House.

Top Executive Mike Landry, Pres.

Year Founded: 1978 Estab. in Alaska: 1978 Employees Alaska: 67 Worldwide: 112

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www.akbizmag.com • Alaska Business Monthly • April 2011

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ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 Spenard Builders Supply Inc.

Business Type: Retail/Wholesale Trade

810 K St., Ste. 200 Anchorage, AK 99501 Phone: 907-261-9105 Fax: 907-261-9142 info@sbsalaska.com www.sbsalaska.com

Parent Company ProBuild Holdings Inc.

Business Description: Provides a full line of building materials and home-improvement products to fill the needs of residential and commercial contractors.

Denver, CO

Community Involvement: Numerous community groups and events, including Habitat for Humanity, March of Dimes and Boys and Girls Club.

Top Executive Ed Waite, Pres.

TelAlaska

Parent Company American Broadband Communications Charlotte, NC

Top Executive Brenda Shepard, Pres./CEO

The Aleut Corporation

Business Description: TelAlaska is a full service telecommunications company serving 25 rural communities and providing advanced network services to urban markets. Community Involvement: Alaska Zoo, Armed Services YMCA, Unalaska Fire Fighters Ball, Seward Senior Center, Nome Arts Council, Cooper Landing Museum, and many more.

Business Description: Government contracting, oil and fuel storage, commercial and residential real estate, gravel operations, oil well testing and instrumentation. Community Involvement: Aleut Foundation, scholarships, burial assistance, culture camps, language, environmental protection, economic development, housing, vocational rehab and more.

Top Executive David Gillespie, CEO

Champions of Industry 4300 B St. Anchorage, AK 99503 Phone: 907-243-2944 Fax: 907-243-2984 dc@kuskowkim.com www.kuskokwim.com

Business Type: Native Organization Business Description: Alaska Native corporation. Community Involvement: Kuskokwim Educational Foundation.

Top Executive Maver Carey, CEO

Business Type: Retail/Wholesale Trade

The Odom Corp.

561 E. 36th Ave. Anchorage, AK 99503 Phone: 907-278-4000 Fax: 907-278-4050 info@tatitlek.com www.tatitlek.com

Top Executive Roy Totemoff, Pres./CEO

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Employees Alaska: 110 Worldwide: 110

Year Founded: 1972 Estab. in Alaska: 1972 Employees Alaska: 168 Worldwide: 883 Worldwide: $159.00M

Power ~ Performance ~ Productivity

The Kuskokwim Corporation

The Tatitlek Corporation

Year Founded: 1968 Estab. in Alaska: 1968

Business Type: Native Organization

4000 Old Seward Hwy., Ste. 300 Anchorage, AK 99503 Phone: 907-561-4300 Fax: 907-563-4328 info@aleutcorp.com www.aleutcorp.com

Top Executive John Odom, CEO/Chair

Employees Alaska: 750 Worldwide: 10,000

Business Type: Telecommunications

201 E. 56th Ave. Anchorage, AK 99518 Phone: 907-563-2003 Fax: 907-565-5539 customerservice@telalaska.com www.telalaska.com

240 W. First Ave. Anchorage, AK 99501 Phone: 907-272-8511 Fax: 907-264-0259 www.odomcorp.com

Year Founded: 1952 Estab. in Alaska: 1952

Parent Company The Odom Corporation Bellevue, WA

Business Description: Licensed wholesale alcoholic beverage distributor, franchised soft drink distributor. Community Involvement: AK Aviation Museum, AK Zoo, ALPAR, American Cancer Society, Rotary, Boys & Girls Club, Junior Achievement, Anchorage School Athletics, Armed Services, YMCA, ASYMCA, AHA, ADA, Beans Cafe and more.

Year Founded: 1977 Estab. in Alaska: 1977 Employees Alaska: 40 Worldwide: 144 Gross Revenue Alaska: $7.47M Worldwide: $149.41M

Year Founded: 1933 Estab. in Alaska: 1933 Employees Alaska: 380 Worldwide: 1,600 Gross Revenue Alaska: $225.00M Worldwide: $650.00M

Business Type: Native Organization

Year Founded: 1973 Estab. in Alaska: 1973

Business Description: Alaska Native Village Corporation.

Employees Alaska: 138 Worldwide: 2,171

Community Involvement: Active in a variety of sponsorships and community involvement, including The Copper Mountain Foundation providing scholarships, Tatitlek Culture Week, Alaska YMCA, Salute to the Military and more.

www.akbizmag.com • Alaska Business Monthly • April 2011

Gross Revenue Alaska: $19.00M Worldwide: $115.00M


ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 Business Type: Transportation

Totem Ocean Trailer Express

2511 Tidewater Rd. Anchorage, AK 99501-1044 Phone: 907-276-5868 Fax: 907-278-0461 gkessler@totemocean.com www.totemocean.com

Parent Company Totem Ocean Trailer Express

Business Description: A privately held Alaska corporation and vessel-operating common carrier. Runs a fleet of roll-on/ roll-off trailer ships between the ports of Tacoma, Wash., and Anchorage.

Top Executive George Lowery, Alaska Dir.

Community Involvement: AK Food Bank, ALPAR, United Way, Seward Polar Bear Fest, UAF, Providence Children's Hospital, Anchorage Concert Association, Imaginarium, Alaska SeaLife Center, Anchorage Museum, Bean's Cafe and more.

Udelhoven Oilfield System Service

Business Type: Industrial Services

184 E. 53rd Ave. Anchorage, AK 99518-1222 Phone: 907-344-1577 Fax: 907-344-5817 rfrontde@udelhoven.com www.udelhoven.com Top Executive Jim Udelhoven, CEO

Ukpeagvik Inupiat Corporation PO Box 890 Barrow, AK 99723 Phone: 907-852-4460 Fax: 907-852-4459 info@ukpik.com www.ukpik.com

Top Executive Anthony E. Edwardsen, Pres./CEO

Federal Way, WA

Business Description: Oilfield services, construction management, electrical and mechanical system installation. Community Involvement: American Diabetes, American Heart Association annual Heart Walk, Junior Achievement, Green Star, United Way and much more.

Business Type: Native Organization Business Description: UIC is the Native Village Corporation for Barrow and provides construction, architecture and engineering, regulatory consulting, technical and professional services, marine operations and maintenance. Community Involvement: Education through scholarship foundation, Barrow radio station KBRW, Barrow Whaling Captains Association, Barrow Whaler Athletic Foundation and more.

www.akbizmag.com • Alaska Business Monthly • April 2011

Year Founded: 1975 Estab. in Alaska: 1975 Employees Alaska: 30 Worldwide: 140

Year Founded: 1970 Estab. in Alaska: 1970 Employees Alaska: 560 Worldwide: 611 Gross Revenue Alaska: $121.00M Worldwide: $129.00M

Year Founded: 1973 Estab. in Alaska: 1973 Employees Alaska: 600 Worldwide: 1,900 Gross Revenue Alaska: $97.00M Worldwide: $267.00M

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ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 UNIT Company

620 E. Whitney Rd. Anchorage, AK 99501 Phone: 907-349-6666 Fax: 907-522-3464 info@unitcompany.com www.unitcompany.com Top Executive Michael Fall, Pres.

Usibelli Coal Mine Inc. PO Box 1000 Healy, AK 99743 Phone: 907-683-2226 Fax: 907-683-2253 info@usibelli.com www.usibelli.com

Top Executive Joseph E. Usibelli Jr., Pres.

USKH Inc.

2515 A St. Anchorage, AK 99503 Phone: 907-276-4245 Fax: 907-258-4653 marketing@uskh.com www.uskh.com Top Executive Timothy Vig, Pres./Principal

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Business Type: Construction Business Description: Commercial general contractor. Community Involvement: Various community involvement with kids sporting organizations, Covenant House, CFMA scholarship involvement.

Business Type: Mining Business Description: Coal mining and coal marketing. Community Involvement: United Way, Denali School District, ELC Daycare, Kids in Motion, Tri-Valley Community Library, Healy hockey, Morris Thompson Cultural Center, Tri-Valley VFD, Girl Scouts, Boys & Girls Club and more.

Year Founded: 1977 Estab. in Alaska: 1977 Employees Alaska: 75 Worldwide: 75 Gross Revenue Alaska: $69.00M Worldwide: $69.00M

Year Founded: 1942 Estab. in Alaska: 1942 Employees Alaska: 120 Worldwide: 120 Gross Revenue Alaska: $50.22M Worldwide: $50.22M

Business Type: Industrial Services Business Description: Architecture; civil, structural, transportation, mechanical and electrical engineering; land surveying; airport planning and design; planning; environmental services; landscape architecture. Community Involvement: United Way, Kiwanis, AWAIC, School Business Partnerships, Olympian Holly Brooks.

www.akbizmag.com • Alaska Business Monthly • April 2011

Year Founded: 1972 Estab. in Alaska: 1972 Employees Alaska: 106 Worldwide: 166


ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 USTravel

Business Type: Travel & Tourism

999 E. Tudor Rd., Ste. 200 Anchorage, AK 99503 Phone: 907-561-2434 Fax: 907-786-0180 info@ustravel.us www.ustravel.us

Parent Company Eliason Investment Co. LLC Anchorage, AK

Top Executive Mark Eliason, Pres./CEO

Watterson Construction Co.

Business Description: General building contractor. Community Involvement: ABC of Alaska, Alaska Zoo, YMCA, S.A.M.E., Catholic Social Services, University of Alaska Fairbanks, Junior Achievement, YWCA and Habitat for Humanity.

Top Executive Bill Watterson, Pres.

301 W. Northern Lights Blvd. Anchorage, AK 99503 Phone: 907-265-2730 Fax: 907-646-7829 www.wellsfargo.com

Top Executive Richard Strutz, Alaska Reg. Pres.

Parent Company Wells Fargo & Company San Francisco, CA Stock Symbol WFC

Champions of Industry

XTO Energy Inc.

52260 Wik Road Kenai, AK 99611 Phone: 907-776-2506 Fax: 907-776-2542 scott_griffith@xtoenergy.com www.xtoenergy.com Top Executive Jack Williams, Pres.

Community Involvement: Anchorage Convention & Visitors Bureau, American Red Cross-Alaska Chapter, Junior Achievement Alaska, Anchorage South Rotary, Alaska Travel Industry Association, United Way, SKAL Anchorage and more.

Business Type: Construction

6500 Interstate Cir. Anchorage, AK 99518 Phone: 907-563-7441 Fax: 907-563-7222 info@wattersonsconstruction.com www.wattersonconstruction.com

Wells Fargo Bank, N.A.

Business Description: USTravel is the largest independent travel management company in the Pacific Northwest.

Year Founded: 1978 Estab. in Alaska: 1978 Employees Alaska: 82 Worldwide: 175 Gross Revenue Alaska: $89.00M Worldwide: $174.50M

Year Founded: 1981 Estab. in Alaska: 1981 Employees Alaska: 80 Worldwide: 81 Gross Revenue Alaska: $75.00M Worldwide: $75.00M

Business Type: Finance, Insurance, Real Estate Business Description: Wells Fargo team members provide Alaskans with banking, insurance, investments and mortgage solutions from 60 offices across The Great Land. Community Involvement: Each year, Wells Fargo invests $1.5 million in more than 280 nonprofits and schools in Alaska. Alaska team members volunteered 10,000 hours in 2010.

Year Founded: 1852 Estab. in Alaska: 1916 Employees Alaska: 1,000 Worldwide: 280,000

Power ~ Performance ~ Productivity

Parent Company Exxon Mobile Corporation

Business Type: Oil & Gas

Irving, TX

Community Involvement: XTO Energy Inc. enjoys active participation in the communities where the company operates. In Alaska, XTO supports and funds many events and groups.

Stock Symbol XOM

Business Description: Oil and gas production.

Year Founded: 1986 Estab. in Alaska: 1998 Employees Alaska: 34 Worldwide: 3,400 Gross Revenue Alaska: $66.68M Worldwide: $7.06B

Get your copy of Alaska’s most read business resource tool! Available at: Barnes & Noble, Borders Books, or the publisher at Alaska Business Publishing, 501 W. Northern Lights Blvd., Suite #100 Anchorage, Alaska 99503. (907) 276-4373

www.akbizmag.com • Alaska Business Monthly • April 2011

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ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 SPECI A L

S E C T I O N

Alaska Regional Hospital Striving for better, not bigger By Tracy Kalytiak

Orthopedic Accomplishments

Those skittish patients quickly learn that getting a hip or knee replaced is a radically different experience than it used to be. At Alaska Regional, joint-replacement patients attend “joint camp,” to learn what will happen to them and what doctors will expect them to do before and after surgery to ensure a successful result. Titanium joints are lighter. Patients can use pumps to give themselves pain medication when they need it, instead of having to call a nurse for help. They start moving and walking almost immediately after surgery. Orthopedics is a particularly strong field for Alaska Regional, a 48-year-old facility listed as one of the Alaska Business Monthly’s 2011 Corporate 100. A U.S. News & World Report magazine study, “2010-2011 Best Hospitals,” listed it as the 47th best hospital in the country for orthopedics. Alaska Regional was the only facility listed in the top 50 hospitals for any of the 16 adult-care specialties the magazine examined at nearly 5,000 hospitals nationwide; the study used data related to patient outcomes, quality of care, physi-

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cian perception and staffing rates in determining rankings.

Comprehensive Services

The hospital also has grown highly regarded cardiovascular, cardiac surgery and neuroscience programs, in addition to offering comprehensive inpatient and outpatient services, technologically advanced surgical services and cancer resources. Its critical-care air ambulance transports patients directly to Alaska Regional’s emergency department.

Annie Holt Chief Executive Officer Alaska Regional Hospital

Annie Holt, the hospital’s chief executive officer, said hospital officials and staff are constantly looking at ways they can continue to improve patients’ experiences and the quality of services. “Since we are the smaller of two acute-care hospitals in Anchorage, we are always striving to be better, rather than bigger,” said Holt, who has helmed the 1,000-employee facility since 2009. “Each week, members of our management team and I visit with patients and their families to learn about their experience

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© 2011 Chris Arend

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hen Rosemary Kline first started working for Alaska Regional Hospital, patients getting a hip or knee replacement could expect a traumatic experience. “Twenty-five years ago, someone getting a total joint replacement would stay in the hospital for two weeks; they bled like crazy; they didn’t have the scopes like they do now so they’d come back with a footlong incision from surgery,” said Kline, a registered nurse who works as director of Alaska Regional Hospital Orthopedic and Rehab Services. “I can’t tell you how many times people come in apprehensive about joint replacement.”


during their stay at our hospital. I am consistently told it feels like family here in our facility and that our patients appreciate the combination of cohesiveness and professionalism demonstrated by our staff.”

Expanding Employee Roles

The hospital has worked to improve efficiency without sacrificing that quality of patient care. Holt says the hospital uses process-improvement methods to analyze workflow, improve safety for patient care and eliminate unnecessary steps. Examples include use of an electronic medication administration record barcode scanning system that verifies the right patient is getting the right medication dosage at the right time. “This system was mainly developed to increase patient safety, and has resulted in reduction of medication errors, medication turnaround times and timely reporting,” Holt said. “We use a similar system for blood transfusions.” Alaska Regional’s so-called PACS – picture archiving and communication system – is another example of how the hospital is enhancing efficiency. Digital radiology images can be accessed and viewed immediately by physicians at any station throughout the hospital rather than being archived in a patient film library for staff to retrieve and deliver. “In some instances, we’ve expanded the role of our employees in existing positions to improve workflow or efficiency,” Holt said. “We use physical therapy technicians to assist the therapists by preparing and transporting patients, adjusting equipment and otherwise freeing up the therapist to concentrate on providing skilled treatment.”

Community Support

Alaska Regional supports the community through millions of dollars in unpaid health care costs, in addition to taxes paid each year to local government, Holt said. “In 2009, we absorbed the cost of over $28 million in uncompensated health care,” she said. “And, as one of the largest local taxpayers and the only tax-paying acute-care www.akbizmag.com • Alaska Business Monthly • April 2011

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“In 2009, we absorbed the cost of over $28 million in uncompensated health care. And, as one of the largest local taxpayers and the only taxpaying acutecare hospital in the Municipality of Anchorage, Alaska Regional paid nearly $3.5 million in Alaska taxes.” ­—Annie Holt Chief Executive Officer Alaska Regional Hospital

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hospital in the Municipality of Anchorage, Alaska Regional paid nearly $3.5 million in Alaska taxes.” The hospital augments the number of physicians who practice at the facility by looking to parent c o m p a n y H CA’ s p h y s i c i a n r e cruiting division, which “sources” physician candidates for HCA’s 170 - p l u s h o s p i t a l s . C u r r e n t l y , Alaska Regional has a medical www.akbizmag.com • Alaska Business Monthly • April 2011


staff of more than 450 independent practitioners. “They are experts in supporting us to meet the needs of our communities,” Holt said. The number of spine-surgery patients at the hospital has increased more than 200 percent in the last year; 38 percent of all orthopedic-surgery patients there were spine patients. Dr. James Eule, an orthopedic spine-fellowship-trained surgeon, performs almost all of his operations at Alaska Regional. He explained the number of spine surgeries has risen dramatically due to an influx of spine surgeons in Anchorage, new technology being available nationwide, and because people would rather have their spine surgery closer to home if it can be done well. “More Alaskans thought they had to go to Seattle to get a complicated spine surgery,” Eule said. “Now they realize they can get it here.” An Alaska Regional patient, Bevist St. Luise, 60, had knee-replacement surgeries last April and in December, after suffering for years with disabling knee pain. “Just the joints were worn out,” she said. St. Luise couldn’t play on the beaches near Kenai with her grandchildren, couldn’t shop for groceries unless she rode in a cart and took painkillers, couldn’t use stairs without excruciating pain. “My daughter works there, that is where she wanted her mother to go,” St. Luise said. “They answered questions I didn’t realize I had. I felt really taken care of all through the whole process.” St. Luise’s husband, a former heavy-equipment operator, hyperextended both his knees after falling over a knee-height trailer 20 years ago. He has been seeing an Outside physician ever since. “His doctor said to go ahead and go (to Alaska Regional), you’ve got good care there,” St. Luise said. Now, St. Luise’s knees occasionally ache, but the sensation is no longer a “constant drain” on her. “Life is good,” she said. “Life is really good.” q www.akbizmag.com • Alaska Business Monthly • April 2011

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ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 SPECI A L

S E C T I O N

Arctic Slope Regional Corp. Delivering benefits to shareholders By Tracy Kalytiak

Providing Vital Benefits

In its history, ASRC has paid out more than $483 million to its shareholders in the form of direct dividends and, since 2000, ASRC has distributed more than $90 million in earnings to support a wide range of socio-economic programs for those living in its region. With continuing uncertainty in the economic environment, Rock said, it’s

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more important than ever to maintain a long-term vision that enables ASRC to provide vital benefits for its 11,000 Inupiat shareholders and make the best use of its lands, which contain oil and gas, coal and base metal sulfides. Known resource reserves on AS RC land include the Alpine oilfield and the Western Arctic coalfields.

Business Model

A S RC’s pattern of partnering with and learning from established businesses evolved as the corporation gained experience. It acquired Houston Contracting Co. and created Natchiq Inc., a holding company for oilfield service and construction companies that Rex A. Rock Sr. President and Chief Executive Officer Arctic Slope Regional Corp.

included Alaska Petroleum Contractors, GSL Oilfield Service, Entech and VRCA Environmental Services. That move ignited growth that doubled ASRC’s revenue between 1985 and 1989. 1990 was a banner year for ASRC – revenues

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© 2011 Chris Arend

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lose to 39 years ago, Arctic Slope Regional Corp. sprang into being, formed to oversee 5 million North Slope acres the Alaska Native Claims Settlement Act bequeathed on the Inupiat people, as well as generate wealth and jobs for the corporation’s 3,800 shareholders. Its early decision to form joint ventures with experienced business partners, learn from those “tutor” partners, and then buy them out and create wholly owned subsidiaries developed into a fruitful pattern for ASRC, which diversified from oil and oil-related construction into energy services, petroleum refining and marketing, construction, government services and resource development. Now, Barrow-based ASRC has 11,000 shareholders on its rolls. “It’s important for people to keep in mind that when they see ASRC as a $2.3 billion company, there was a time during our humble beginnings when our leaders worked for no pay,” said Rex A. Rock Sr., ASRC’s president and chief executive officer. “Only through hard work and long-term planning are we where we are today. We live by our mission of actively managing our businesses, our lands and resources, our investments and our relationships to enhance Inupiaq cultural and economic freedom with continuity, responsibility and integrity.”


climbed 94 percent and the number of employees rose to 1,500. “By all measures, ASRC entered the 1990s as the prime example of the benefits a regional corporation could deliver to its shareholders,” according to a corporate history, “It ranked as the largest of the 13 regional corporations, comprising 14 wholly owned subsidiaries and 20 operating divisions.”

Revenue Fluctuations

Congress’s prohibition of oil exploration and development in the Arctic National Wildlife Refuge’s coastal plain curbed ASRC’s desire to grow an oil-production operation and turned its attention toward acquiring diverse businesses outside Alaska’s borders. In 2008, ASRC reported $2.297 billion in revenue, which marked the first time in the corporation’s history it broke the $2 billion mark. That year, ASRC distributed almost $65 million in total dividends of $61.10 a share to its shareholders – up from $58.55 a share – around $60 million, total – the year before. In 2009, revenues were $1.95 billion, down around 15 percent mainly due to instability in commodity prices, a drop in fuel sales due to high oil prices and the lingering effect of ASRC’s Valdez refinery shutdown, due to a fire in December 2008. “As we close the books on 2010, we saw our revenues exceed $2.3 billion,” Rock said. “We are still deliberate in building an organization that crosses industries, market segments and geographic regions – and will see the best opportunities that match our values when they arise.” The corporate website details the AS RC family of companies, including ASRC Federal Holding Co. with subsidiaries Analytical Services Inc., ASRC Aerospace, ASRC Communications, ASRC Management Services, ASRC Primus, ASRC Research and Technology, InuTeq, Mission Solutions Engineering and World Technical Services Inc.; Petro Star Inc. with aviation, heating fuel, lubricants, marine, refining and retail divisions; ASRC Construction Holding Co. with subsidiaries ASRC

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“As we close the books on 2010, we saw our revenues exceed $2.3 billion. We are still deliberate in building an organization that crosses industries, market segments and geographic regions – and will see the best opportunities that match our values when they arise.”

“Commitment to Quality Through Pride of Employee Ownership.” The Superior Group is committed to becoming the best mechanical and electrical contractor in Alaska... to do this we pledge to meet and exceed our customers’ requirements every time by providing services of the highest quality.

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­— Rex A. Rock Sr. President and Chief Executive Officer Arctic Slope Regional Corp.

SKW Eskimos, ASRC Constructors, ASRC Civil Construction, ASRC Construction Technologies, ASRC Gulf States Constructors and ASRC Builders; and Alaska Growth Capital, which uses private and public money to issue small business loans from $100,000 to $10 million, guaranteed by the Small Business Administration and U.S. Department of Agriculture.

Regulatory Hurdles

ASRC has taken action to address difficulties related to recent fuel sale

www.akbizmag.com • Alaska Business Monthly • April 2011


reductions and volatile commodity prices. After the Petro Star refinery went back online in November 2009, ASRC worked to meet the federal deadline of providing ultra-low sulfur diesel by December 2010. “When a portion of our business is related to oil exploration, development and support, we certainly have a stake in making sure there are no unreasonable, unnecessary and overreaching regulatory hurdles to jump over,” Rock said. The most formidable of these hurdles, Rock said, concerned “critical habitat” designation for polar bears on the North Slope. ASRC, along with the North Slope Borough and other Alaska Native groups, notified the U.S. Interior Department of their intent to sue because of that issue. “Our independent analysis found that even a one-year delay in production for a relatively small field on the Slope – 190 million recoverable barrels – would add up to a loss of more than $200 million in royalties and tax revenues over 15 years,” Rock said. “For a larger field – something like 700 million recoverable barrels – that number jumps to nearly $580 million.” Rock says the designation is a poor attempt at legislating climate change through regulation. “The Department has recognized that this designation will not have any impact on the primary threat to polar bears – the loss of sea-ice habitat – but it could cripple our communities,” he said. “That’s why we’ve been forced to seek the help of the courts, and why we take this matter so seriously.”

Strategic Plan

The groundwork for sustainable earnings has been laid over many years at ASRC, Rock said. “Our founding members began building a combination of operating businesses and investments,” he said, “That now serve as the foundation of our current strategic plan, which includes increasing sustainable financial earnings, encouraging village economic development and the crossgenerational transmission of our Inupiaq values.” q www.akbizmag.com • Alaska Business Monthly • April 2011

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ALASKA BUSINESS MONTHLY’S 2011 CORPORATE 100 SPECI A L

S E C T I O N

ConocoPhillips Alaska Committed to Alaska By Vanessa Orr

Cook Inlet Gas

“In Alaska, all of our gas interests are in the Cook Inlet area, including the offshore Tyonek platform and the onshore Beluga River natural gas field,” Johansen said. “Most of that gas is delivered locally, though some is exported through our Kenai Liquefied Natural Gas (LNG) facility.” The company, which is headquartered in Anchorage, is also a 28 percent owner in the trans-Alaska oil pipeline system and a 50 percent owner in Denali - The Gas Pipeline Project.

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In 2010, ConocoPhillips decided to shut down the Kenai LNG plant after 40 years of operation after shipments end in roughly mid- to late-May. “We are not dismantling the plant; we are putting it into ‘mothball mode,’” Johansen said. “We will preserve and maintain it, so that when an opportunity arises for import or possibly export, it can be reopened.” ConocoPhillips began exploratory drilling in the National Petroleum Reserve-Alaska (NPR-A) in 2008, and also obtained 98 lease blocks covering more than 550,000 acres in the Chukchi Sea. While the company has currently stopped exploration projects in the NPR-A, Johansen

Trond-Erik Johansen President ConocoPhillips Alaska

said they do have plans to drill in the Chukchi in approximately two years. “In the past, we did exploration work in the NPR-A area, but we chose not to continue that work last year, and don’t plan to work there again this year for two reasons,” Johansen said.

www.akbizmag.com • Alaska Business Monthly • April 2011

© 2011 Chris Arend

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or more than 50 years, the State of Alaska and ConocoPhillips have worked together to develop the region’s natural resources and to create economic opportunities. And while the last two decades have seen a decrease in the production of oil and natural gas, the company remains committed to the state and its future. “There is still a lot of oil left in Alaska, on the North Slope in particular,” said Trond-Erik Johansen, president, ConocoPhillips Alaska. “From a job standpoint, Alaska has many exciting opportunities, but it also faces many challenges. But I am convinced that by working together – the industry and the State – we should be able to tackle these challenges and unlock new potential.” As the largest oil and gas producer in the state, ConocoPhillips had a net production of 230,000 barrels of oil per day in 2010, and averaged 82 million cubic feet of gas per day. The company has a major ownership interest in two of North America’s largest oil fields on the North Slope; Kuparuk, which it operates, and Prudhoe Bay. It also operates the Alpine oil field on the western North Slope.


“Because of the current tax situation in Alaska, there are billions of barrels of oil that have yet to be unlocked. When you look at the Lower 48 and the rest of the world, you see more viscous oil being produced because of a better tax environment.

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“First, we believe the area shows less geologic potential than it did years ago, which is in line with what the U.S. Geologic Survey says. Second, the fiscal regime in Alaska complicates our willingness to invest more money at that site.

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“Our main focus now is on the offshore outer continental shelf leases in the Chukchi Sea, which show good indicators of both oil and gas reserves,” he said. “We hope to start a drilling campaign there in 2013, and are now working with the federal government on permitting. We’ll do exploratory drilling first, than appraise what we find. If we are successful, this will become a new ConocoPhillips production area.” There are many challenges facing companies trying to get oil and gas out of the ground, including the fact that drilling sites are becoming more remote as they explore new areas, and that the oil left in the ground is heavier and more viscous than what has previously been extracted. “Because of the current tax situation in Alaska, there are billions of barrels of oil that have yet to be unlocked,” Johansen said. “When you look at the Lower 48 and the rest of the world, you see more viscous oil being produced because of a better tax environment. Companies will take more risks because they will get more reward. In Alaska, the current environment has oil companies taking on the risk, but getting less reward.” According to Johansen, the tax structure and oil companies’ unwillingness to invest in more exploration is having further effects as well. “In the past, the trans-Alaska oil pipeline transported 2 million barrels of oil a day; now it’s down to 600,000 barrels,” he said. “Unless the State encourages companies to go after in-field drilling, such as utilizing the resources at Kuparuk and Alpine, it puts pipeline operations at risk.”

Good Example

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In 2010, ConocoPhillips employed 1,100 people in Alaska between www.akbizmag.com • Alaska Business Monthly • April 2011


“In the past, the trans-Alaska oil pipeline transported 2 million barrels of oil a day; now it’s down to 600,000 barrels. Unless the

and education purposes, as well as hospitals and health care needs. In this tough economic climate, ConocoPhillips also takes a leading role in the development of new technologies to help further the development of the state’s natural resource industry. “We provide the technology and skills of our knowledgeable employee base, as well as work with the contracting community to unlock more potential,” Johansen said. Recent legislation by Gov. Sean

Parnell has him hopeful that the State and the oil industry will continue to work together to improve Alaska’s production forecast. The legislation proposes tax credits for drilling new wells, a lower base tax rate for exploration areas outside of existing fields, and a cap on production taxes at 50 percent. “In many ways, the bill that the governor put out there is a step in the right direction,” he said. “Alaska has a big future if the right investment climate q is in place.”

State encourages companies to go after in-field drilling, such as utilizing the resources at Kuparuk and Alpine, it puts pipeline operations at risk.” — Trond-Erik Johansen President ConocoPhillips Alaska

its Kenai, Anchorage and North Slope operations, and earned approximately $1.7 billion in net revenues. The company paid $1.6 billion in production taxes to Alaska, plus State and federal corporate income taxes and royalties, which numbers were not disclosed. In addition, the company gave back to the communities it serves through charitable means. “Last year, we helped more than 300 organizations in ways ranging from monetary donations to providing human resources help or employee volunteers,” Johansen said. The company donated more than $6 million in 2010, with a large share going toward the University of Alaska www.akbizmag.com • Alaska Business Monthly • April 2011

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TRANSPORTATION ANNIVERSARY

Photos courtesy of Pacific Alaska Freightways

PAF Anchorage terminal prepares a customer’s load for delivery.

Pacific Alaska Freightways Celebrates 50 Years in Alaska Washington-state company builds lasting relationships with Alaskans

A

By Molly Dischner

fter 50 years in Alaska, there isn’t much that surprises the people at Pacific Alaska Freightways, a Fife, Wash.-based shipping company. The company moves almost everything a person could need to Alaska and around the state. Like the U.S. Postal Service, they do it in all sorts of conditions. “Everything that you touch and feel and see that constructs anything that is worn by anyone has to be shipped into Alaska,” said Joan Johnson, the company’s Alaska sales executive, who is based in Fairbanks. But for PAF, the business is about building relationships, not just the boxes they move. “Our ability to be around 50 years later is a testament to our clients up in Alaska asking for us,” said Director of Sales and Marketing Curt Dorn, who works out of the company’s Fife headquarters.

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Moving Anything, Everything

The company’s clients range from the hospitality industry to oil field construction. It moves anything that is sold wholesale to electricians or is needed by retail stores to sell to the public. Retail needs range “from dog food to candy to clothing, china, fabric,” Johnson said. With such a long history in the state and the wide range of goods shipped, there are just a few things that stand out as unusual. Like the 55 gallons drums someone wanted brought north. “A client called today about shipping fuel up from the Lower 48,” Johnson said. “I didn’t ever envision shipping fuel.” Can she make it happen? “Yes,” she said. “Yes.” Once, Johnson helped orchestrate the move of five sports cars for a group of businessmen who planned to drive from Prudhoe Bay to the southern tip of South America.

“It was the Porsche Cayennes,” she said. “They were brand new to the market.” She got the cars to Fairbanks. The drivers flew in and picked them up there, and drove north to Prudhoe before embarking on the crosscontinent adventure. “It was crazy,” she said. Johnson also handles another delivery that’s a little different. PAF is responsible for transporting a giant Christmas tree to Alaska for a Fairbanks hotel every winter. “We ship it every year,” Johnson said. “And it’s huge.” The size isn’t the only thing that makes shipping the tree interesting. Logistically, the company has to time it just right because of the fire-proof chemicals sprayed on the tree to make it safer to put on display. Some things are just interesting because of the logistics of getting them

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moved. Raw sheets of granite are one item taking particular care. “It has special packaging and it has to be handled in a certain manner,” Johnson said, adding not every item has an exciting story because many items are packaged and just another invoice. “There’s not that sentimental effect to it,” she said, and mentioned the company moves households from time to time – an interesting process no matter the item. “They’re all fun,” she said. Like with the Christmas tree, timing can be an issue. Johnson said they have two sailings from Fife each week. It takes four nights to get from the Washington terminal to Anchorage, and one or two more to get delivered to Fairbanks, depending on whether the goods come by truck or train. Goods going to the company’s terminals in Kodiak and Kenai terminals are on slightly different schedules. Pacific Alaska also has agents, but not full-on terminals, in smaller towns such as Juneau and Ketchikan. In addition to transporting goods from Outside to Alaska, they transport goods from one community to another within the state, sometimes relying on assistance from other shippers. Johnson said her clients are good at understanding the timing. “People have gotten pretty good at planning,” she said. Although those logistics can be

PAF remains a privately held corporation with the Smith family actively involved, from left, Norm (Treasurer), Alain (President), Monty (IT Director) and Joe (Chairman of the Board).

tricky, weather doesn’t often delay their shipments. In 50 years, PAF has weathered a number of natural phenomena. Some – like the most recent volcano explosion in Southcentral – have had little effect on their shipping. But weather

events that affect the ocean can be more problematic, Johnson said.

People Factor

Ultimately, it’s not the goods that make Pacific Alaska tick. It’s the people, Dorn said.

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Photos courtesy of Pacific Alaska Freightways

Pacific Alaska Freightways founding Smith family in the 1960s, from left, Norm, Alain, Joe, with youngest brother Monty on his father’s lap.


Photo courtesy of Pacific Alaska Freightways

“We’re here because of (our clients),” he said. Johnson moved to PAF after four years in the shipping industry. Before she worked at PAF, she said she’d talked to PAF clients who weren’t willing to ship with other companies because they had a long-time relationship with PAF. Slowly, she got to know the owner, Joe Smith. They started talking a little and developed a rapport. Eventually he had a job offer for her at PAF’s Fairbanks office, which was then located in the railroad industrial area. “So I accepted,” she said. “And I was shocked.” The facility wasn’t at all what she expected. There was old wooden flooring. She didn’t even have her own office that first year. “The next year, they built on an office,” she said. Most noticeably, they only had three doors at their Fairbanks center. That’s small for a company whose entire business is about moving goods. Doors are the garages for trucks to enter. “In the freight business, it’s all about product and on-time delivery,” she said. She learned that the business was built on strong customer relationships, not facilities. “Sometimes you feel more like friends and family than business associates,” she said. According to Johnson, some of the company’s clients have been with the company for decades, and even longer than she has.

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“We’ve identified that having a good working relationship cultivates a good business relationship,” she said. Part of their strategy involves working with each customer individually. “You kind of customize how we deliver the freight to what their needs are,” she said. The business also tries to stay involved in the community. In Fairbanks, that means Johnson is involved in Rotary, the Chamber of Commerce and other local service. “We’re strong supporters of advocating for awareness with the American Heart Association,” she said. In other cities, the company gets involved how and where they can.

Growing Facilities

Over time, the business has had to grow their facilities in order to serve their customers. In 2001, PAF moved to a facility on Peger Road in Fairbanks. It has 21 doors. “To think in 17 years we went from three doors to 21 doors,” she said. Johnson estimated that having 21 doors means PAF can handle about seven times the volume of goods. Fairbanks isn’t the only terminal that’s grown over the last five decades. Johnson said the company built their Fife headquarters pretty recently. “In 1999, they built our facility in Fife to be closer to Tacoma,” she said. Prior to that, they were closer to Seattle.

Dorn that said running a national business focused on Alaska requires a lot of communication. “Our communication is critical,” he said. Executives frequently travel north, and they use all communication tools available: e-mail, Internet, phones and more. Dorn said he enjoys visiting the state. “It’s beautiful, breathtaking,” he said. His favorite part of Alaska is Homer. “I love it,” he said. The trips help solidify what happens daily via electronic and other means of transmission. “Talking and listening,” he said. “The communication that we have from Fife to our terminals in Alaska is very good, very positive.” Pacific Alaska might be headquartered in Washington state and serving Alaska, but Johnson says they have partners all across the country. “We can pick it up in Wichita, Kan., and get it all the way to Fairbanks,” she said. So what’s next for the company that can get goods from any zip code in the Lower 48 to any zip code in Alaska? “Our biggest success is that we have a big loyal base of clients out there and we’re going to continue to expand it,” Dorn said. The company will match their growth to their client’s needs, he said. That means focusing on service and client satisfaction. “Building a future with them,” is how he described it. “We’re going to continue doing the same thing we’re doing now.”  q

www.akbizmag.com • Alaska Business Monthly • April 2011


Investing

in

Alaska

By Lee Henry

OP-ED

Extending the Rail Line at Port MacKenzie The next great investment for Alaskans

G

oogle is spending hundreds of millions of dollars on largescale infrastructure by building deep-ocean, wind-energy generating platforms even though it probably already is, pound for pound, the most profitable company on the planet. China is spending billions on roads and bridges when they have already become an economic superpower rivaling Japan, Europe and the United States. Yale and Harvard, managed by some of the best minds in the investment community today, allocate a large percentage of their investment dollars toward infrastructure projects. All of these companies are placing capital into large-scale infrastructure because these are the types of investments that pay off in a way very few other investments can match. Do we need more jobs in Alaska that pay better than minimum wage and do we need a greater degree of independence from the vagaries of the oil market? If our answer to these questions is yes, then we should consider which infrastructure projects will provide these benefits. The first one that comes to mind is the extension of the Alaska Railroad to Port MacKenzie (Port Mac for short.) If you have any doubts about this project, just think about how the American West was really won, not by horse or stagecoach, but by a transcontinental railway system built right after the Civil War and still used today. Initial funding was provided by the Alaska State Legislature last year for the extension of the railroad to Port Mac from the railroad’s main line. Gov. Sean Parnell has included additional funding for it in his initial budget request for the upcoming fiscal year. The project, when

completed in 2014, will probably cost around $250 million and will generate hundreds of construction jobs in the process. When the project is finished, the new line will provide rail service from the Interior to tidewater at Port Mac on the west side of Cook Inlet in the Mat-Su Borough.

Important Investment

The rail extension at Port Mac is important because our investment in this class of infrastructure will provide enormous benefits for Alaska and Alaskans for the next 100 years. If estimates made by its supporters are anywhere close to correct, the new rail extension will eventually generate more than 4,000 good paying jobs in Alaska. It will provide access to our resources for some of the largest ocean-going vessels in the world, many of which require almost twice the draft provided in Anchorage. It will make our natural resources more competitive in world markets. We can, at last, set up a manufacturing base for our resources that gives Alaska the opportunity to leverage this infrastructure development into real economic progress, so Alaska is not just a resource extraction state similar to resource-rich, job-poor third world countries that never really get ahead of the curve. Diversification is a portfoliomanagement strategy that is a welldocumented mechanism for managing risk. In this case, if we diversify away from our dependence on oil dollars we reduce the risk of a catastrophic failure of our economy similar to what happened in the mid-to-late 1980s. Our economy is regaining its strength after the recent recession, but if the price of oil were to

collapse for an extended period of time Alaska would be reduced to borrowing against our future. The first thing we would hear, and we have heard it in the past, is: “Let’s tap the Permanent Fund.” Diversifying the economy is key.

Our Next Step

If we are to compete on a global level, Alaska must take the position that our resources should be developed by, and for, Alaskans. A well-known local economist recently said “Incentives matter!” Let’s offer financial incentives similar to those offered to Cook Inlet energy producers. Maybe we could get ahead of the curve instead of it getting ahead of us.  q

About the Author Lee Henry, CCIM, is a registered representative with Pacific West Securities Inc., and a commercial associate broker at Re/Max Properties Inc. in Anchorage. He has lived in Alaska for more than 30 years and likes to take the long view.

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OIL & GAS

Elusive Pipeline Dreams

Photo by Judy Patrick Photography

Waiting for suitable demand The Central Gas Facility (CGF) on the North Slope in August.

By Mike Bradner

A

laskans are increasingly worried there may not be a $40 billion-plus, 48-inch pipeline built from the North Slope to Alberta, at least any time soon. Hopes for a large-diameter pipeline to Valdez to a natural gas liquefaction, or LNG, plant seems equally elusive. There was more optimism in 2010 when two consortiums working on a gas pipeline had spent $150 million each on cost estimates and preliminary technical investigations. This was serious money. The companies held open seasons, periods when gas-shipping contracts are solicited. One group, headed by TransCanada Corp., a pipeline company, hoped to have contracts signed by the end of the year. Negotiations are still continuing in early March. The competing project, the Denali pipeline owned by BP and ConocoPhillips, held its open season later in the 2010 summer. There have been disappointments

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before on a gas pipeline. One attempt in the 1980s was an effort to build into Canada along the Alaska Highway, the same route being proposed today. The effort collapsed when gas prices in the Lower 48 dropped, a situation eerily similar to today. Another effort, in the early 1990s, involved North Slope producers teaming up to look at a LNG, project in Valdez. It was concluded the Asian market couldn’t absorb the volumes of LNG required to make a Valdez project viable. Today there are huge amounts of LNG being sold in Asia from Southeast Asia and Australia, and there doesn’t seem to be room for Alaska LNG. ConocoPhillips was unable to sell even small quantities of liquefied gas from its existing Kenai LNG plant. The plant’s owners, ConocoPhillips and Marathon Oil, decided to close the facility.

Relief from AGIA

Disillusionment on the gas pipeline has

reached the point where several State legislators argue that it’s time to reconsider the State’s endorsement of the TransCanada project under the State’s Alaska Gasline Inducement Act, or AGIA. The State has committed up to $500 million in a subsidy to TransCanada in return for agreements by the pipeline company to certain terms mainly involving tariffs and schedules. So far, the State has paid $134 million to reimburse TransCanada for expenses and Gov. Sean Parnell has asked legislator’s approval for another payment of $160 million next year. The State subsidy bothers lawmakers because it seems to project will go given the size of the surplus of shale gas in the Lower 48. What also concerns legislators is the agreement with TransCanada limits the State in pursuing an alternative gas project, at least one handling enough gas to make it viable. One alternative the State is considering is a “bullet line,” a 24-inch

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pipeline that would bring gas from the North Slope to Southcentral Alaska where new gas supplies are urgently needed. It could be built if the big pipeline is seriously delayed. But that pipeline will be limited to 500 million cubic feet of gas per day because this limit is agreed to in the TransCanada contract. If the State helps a larger project, there is a treble-damages liability to TransCanada. The State’s team working on bullet line studies will complete a report on cost estimates and feasibility this summer, but many who have looked at initial cost estimates conclude that larger gas volumes must be moved to make the project economic. The TransCanada contract appears to preclude this. The State’s AGIA contract with TransCanada was former Gov. Sarah Palin’s major achievement in her yearand-a-half as Alaska’s governor. Palin had rejected the plan her predecessor, Frank Murkowski, had worked on. This involved a business partnership between the State and three major North Slope gas owners in developing a pipeline. What Gov. Palin pursued, which came to be AGIA, was for the State to offer an incentive in return for a pipeline developer agreeing to a the State’s conditions, or “must haves,” as the governor put it in speeches. These mostly involved the structure of the pipeline tariff, or transportation fee, and financing terms that affect the tariff. The tariff is important because the transportation cost of the gas affects the State’s tax and royalty income. Other AGIA “must haves” include the pipeline company proceeding to work toward licensing by the Federal Energy Regulatory Commission even if there were no contracts signed to ship gas. A key objective of Gov. Palin was to attract a pipeline company to develop and control the project rather than to have the producing companies own and control the pipeline. She worried about monopoly power. The governor hoped that more than one pipeline company would show an interest, but in the end only TransCanada Corp. agreed to the AGIA terms and applied for an AGIA license. At the same time that TransCanada’s proposal was received ConocoPhillips announced that it would pursue its own pipeline project outside

the AGIA process. BP eventually joined ConocoPhillips in what would become the Denali pipeline project. ExxonMobil Corp., another gas owner on the Slope, has aligned itself with TransCanada but has also been careful to point out that it has not agreed to the AGIA terms and will not become a full partner with the pipeline company until relief from AGIA is offered. Ironically, some of the State’s $500 million is being paid to ExxonMobil for that company’s work on the project.

Fundamental Differences

Former Gov. Murkowski’s proposal for the project was fundamentally different than the path followed by Palin. The partnership approach involved the State agreeing to fiscal certainty on tax and royalty administration terms, a condition the producing companies still require, and then taking a 20 percent ownership share in the pipeline. The concept of partial ownership by the State, with a percentage roughly parallel to the State’s royalty and tax share of production

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(about 20 percent) was that the State would essentially ship its own Stateowned royalty gas and earn profits rather than having the royalty gas shipped by another pipeline owner, which would earn profits in shipping the State’s gas. There are complications to such an arrangement, but an advantage is that the State would earn from its pipeline interest in addition to taxes and royalties from gas production on the Slope. Pipeline revenue would be steadier and more dependable than production tax and royalty income that are driven by market prices that can be volatile. Gov. Murkowski’s team saw this as a way for the State to establish more stability in its gas revenues. During the negotiations in 2006, Murkowski also persuaded the three producer companies to agree to a major revamp of the State’s oil and gas production tax, switching from a tax based on gross revenues to one based on net profits. Getting the companies to agree to this was no small accomplishment because it involved

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an increase in tax payments over what was previously paid. Murkowski also included a provision for an investment tax credit as an inducement for producers to invest in Alaska and reap a reduction in taxes through the tax credits. This provision is still in the State tax law and has become very important in encouraging new exploration by independent companies. Gov. Murkowski got the companies to agree to the tax and pipeline partnership package and brought the proposals to the Legislature. Meeting in special session in the summer of 2006, lawmakers focused their attention on the tax change and gave only a cursory review to the pipeline ownership plan. The tax part of the deal was approved but, to the industry’s chagrin, not the pipeline part. The tax law, known as the Petroleum Profits Tax, or PPT, was changed by Gov. Palin and the Legislature in 2007 into what is known now as the “Alaska’s Clear and Equitable Share” law, or ACES. Gov. Parnell has now brought the ACES tax to the Legislature for modification.

Time and Patience

Despite the bleak market outlook, Gov. Parnell says he believes it’s still too early to give up on the gas pipeline, or even on AGIA. The gas project is huge and it should be no surprise that working out the shipping arrangements, which involve huge financial commitments by the gas shippers, are taking longer than expected. TransCanada deserves more time, and patience, the governor has said. Supporting Parnell’s position is Larry Persily, an Alaskan who is now the federal gas pipeline coordinator. Persily said no matter how grim things look now in the Lower 48 gas market there are things happening that bode well for Alaska gas in the long run. For one thing, environmental problems with shale gas are becoming more evident and drillers are encountering political opposition and the likelihood of increased regulation, which will add to costs. Mark Myers, now the University of Alaska Fairbanks’ Vice Chancellor for Research and a former U.S. Geological Survey director, has said shale gas

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drillers are now tapping the easier, more productive parts of the big shale formations. As time goes by they will drill farther and deeper, and into parts of the formations that are less productive and where costs will be higher. Persily said shale gas may eventually turn out to be a help for Alaska because the availability of gas from shale will help flatten the volatility of gas prices, which will encourage the U.S. power industry to build more and larger gasfired power plants. That natural gas is clean burning and less polluting than coal, which is now the mainstay of U.S. power generation, is a big selling point. Persily’s point is that more demand for gas overall will eventually create a market big enough to absorb not only shale gas, but also Alaska’s gas.

Getting to the Crux

What really matters are the views of the major North Slope gas owners who will sign the checks. These include Exxon Mobil Corp., BP, ConocoPhillips and Chevron Corp. These are sophisticated companies used to tackling huge projects requiring years to put together.

These companies do have the financial resources to make the pipeline happen, and in spite of the current glut of shale gas may look out into the future and agree that shale gas will eventually face limits, but that its availability will eventually boost North American gas demand, including for Alaska’s gas. Meanwhile, there are others who have joined the discussion. Alaska U.S. Sen. Lisa Murkowski has suggested it’s for Alaska to consider other options for stranded North Slope gas. In her annual address to the Legislature, Murkowski suggested one or more gas-to-liquids plants could to built to convert gas to high-quality liquid fuels that could be shipped in the Trans Alaska Pipeline System, which is now running at onethird capacity. Gas-to-liquids typically relies on a proven technology, the Fischer Tropsch process, that does chemical conversion of the methane in natural gas, recombining the molecules with the aid of catalysts to form more complex hydrocarbon molecules found in liquid oil products. A refinery unit is part of the plant process for the making of diesel,

jet fuel, gasoline or even petrochemicals. One idea is to put such a plant on the North Slope and ship the liquids through TAPS, segregating them from crude with a “batch” technique using pipeline pigs as separators. Another idea is to build the plant in Fairbanks, or even Southcentral Alaska, with gas delivered through a larger and more economical “bullet line.” David Gottstein, an Anchorage businessman, has suggested the State help finance a large-diameter pipeline to Fairbanks to serve a smaller 24-inch pipeline to Southcentral Alaska and industrial customers in Interior Alaska, possibly including a gas-to-liquids plant. Richard Peterson and his company, Alaska Natural Gas-to-Liquids, have done a substantial amount of work on an Alaska GTL project, including working with Sasol, the South African energy company, and Shell, both of which have commercially proven gasto-liquids processes. There is no lack of creative ideas that could be put to work. Gov. Palin’s AGIA plan may yet work, but many Alaskans worry it has become a straitjacket.  q

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GAS & OIL

Cook Inlet Economic Impact Kenai Peninsula ready for industry revival By Mike Bradner

T

he closure of the Kenai liquefied natural gas plant this spring deals another blow to what remains of the Kenai Peninsula’s oncevibrant industrial sector. The LNG plant is following in the wake of the closure of the Agrium Corp. fertilizer plant a few years ago. Both plants were sources of good-paying jobs for the north peninsula region. Now, only the Tesoro refinery remains at Nikiski, the industrial zone on the North Kenai Road north of the city of Kenai.

Victims of Circumstance

The LNG and fertilizer plants, built 50 years ago, were victims of changing circumstances. Both plants rely on the natural gas-producing fields that once enjoyed high production rates. As gas supplies dwindled, the price of gas increased in recent years to the point that the fertilizer plant could not get gas it could afford, nor could it even get commitments from producing companies to supply gas. The LNG plant was a victim of circumstances, too, of tightening gas supplies to the plant and changes in a complex Asian natural gas market. The plant’s owners, ConocoPhillips and Marathon Oil, said they could not get the desired price from buyers for the relatively small volume of LNG the plant would ship. ConocoPhillips and Marathon say they will maintain and keep the plant intact against the possibility it can be used in some other way, perhaps as a part of a program to import LNG for supplemental gas supplied for the regional utilities.

Refinery Safe For Now

The Tesoro refinery seems secure, at least for now. Tesoro recently completed a significant investment in the plant to reduce the benzene content of its fuels, and is planning another investment to further reduce benzene.

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Photo by Judy Patrick Photography

The Nikiski area is home to many industrial facilities including the LNG plant and a refinery. Pictured is the Tesoro Refinery.

A few years ago Tesoro also made a large investment in a unit for the plant to produce ultra-low sulfur diesel. This is now required by the U.S. Environmental Protection Agency for use in trucks operating on highways and mobile off-road equipment. Putting this kind of money into the plant would seem to be a signal the company doesn’t intend to close the refinery. However, this plant faces its own set of challenges. Tesoro once considered closing it and supplying its Alaska retail outlets from the company’s refineries in Washington state and Hawaii. If circumstances change or problems develop the company may revisit the idea.

Gradual Industry Decline

The Kenai Peninsula will likely always be home to the gas production industry that previously supplied the plants but will now continue to serve Southcentral electric utilities and Enstar Natural Gas Co., which supplies gas for space heating. Gas reserves in the older fields are running down, which concerns the utilities, but there is also new gas exploration under way. The closure of the plants seems symbolic, however, of a long and gradual decline in the regional petroleum industry. Oil production peaked in Cook Inlet at about 140,000 barrels per day

in the 1970s, but has now declined to about 12,000 barrels per day. Employment in production operations has dropped, too. The Alaska Department of Labor and Workforce Development said oil production jobs accounted for about 6 percent of the jobs in the Kenai Peninsula Borough, but about 16 percent of the wages paid in the borough in 2008. Industry jobs are high-paying, averaging $86,700 per year in 2008. That’s far above the average pay of all workers in the borough, which was $38,850 per year in 2008. These figures actually understate the economic contribution because the job and payroll totals do not include workers in the refinery or the LNG plant, which are classified as manufacturing jobs by the Labor Department.

Exploration Rejuvenation

What seems ironic is the LNG plant closure is happening just as the Cook Inlet oil and gas industry, which provides the foundation for the industrial plants, is seeing the start of a rejuvenation. New companies are on the scene, including large and small independents making investments and exploring. The discoveries are still small in scale, and in some cases companies are developing, or redeveloping, discoveries made earlier that were thought to be marginal or uneconomic. If these continue, and

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if there is enough of them, they could set the stage for a rebound of the peninsula’s petroleum-based manufacturing, but probably in some form that can’t be foreseen now. Some examples of new developments include the work by Armstrong Oil and Gas, a Colorado company, in developing new gas wells at the small North Fork gas field east of Homer, on the peninsula. Armstrong has completed a new pipeline to connect with new pipeline built by Enstar Natural Gas Co. from Ninilchik to Anchor Point, north of Homer. The North Fork field won’t be a big gas producer, at least now, but having gotten the wells into production Armstrong is very bullish about expanding the field with new drilling. There is more potential for gas in the area, the company believes. Two Australian companies are also exploring. Linc Energy has drilled a gas exploration well in the MatanuskaSusitna Borough that encountered gas, although the well is still being tested for commercial production. Although this is in the Southcentral region rather than the Kenai Peninsula, Linc Energy’s

success will motivate others to explore, including on the peninsula. Linc is planning more exploration of Cook Inlet’s west side near Trading Bay. Service companies based in Kenai support the west Inlet activity, so projects there benefit the entire region. Another Australian company, Buccaneer Energy, is exploring for gas on the peninsula itself near the long-established Cannery Loop gas field south of the city of Kenai. Also, NordAq Energy Inc., an Alaska firm, has drilled to test gas prospects in the Kenai National Wildlife Refuge on a lease with Cook Inlet Region Inc., CIRI, the Alaska Native corporation for Southcentral Alaska that owns subsurface rights in some locations in the refuge.

Jack-Up Rigs Coming

In another development that is important, Buccaneer and Escopeta Oil and Gas, another independent, plan to bring jack-up rigs to Cook Inlet this summer to drill test wells in deeper waters of the Inlet. These efforts have the potential for discovering significant new oil and gas accumulations,

many geologists believe, in prospects located in waters beyond the reach of wells drilled from on-shore or on one of the offshore platforms. Floating drillships and jack-up rigs have previously been used to explore in Cook Inlet, but not for 25 years or more. In the meantime, companies have re-looked at offshore areas previously explored using new exploration tools, such as three-dimensional seismic. With these newer techniques geologists believe they have found possible deposits of oil and gas previously undetected, when older seismic technology was used. On the other side of Cook Inlet another independent, Cook Inlet Energy, is redeveloping the small Redoubt Shoal and West MacArthur River oil fields. Both were shut down in the bankruptcy of Pacific Energy Resources, the previous owner. Cook Inlet Energy is a new subsidiary of Miller Petroleum of Tennessee, formed to take over and operate the assets acquired in the Pacific Energy bankruptcy. The company has been producing about 1,000 barrels per day of oil from wells in the West

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MacArthur field and plans to repair and redrill wells on the Osprey platform that produced for a period from the Redoubt Shoal field. Cook Inlet Energy also has plans to drill for more oil, and gas, in the West MacArthur field. The company already has brought a small drill rig to the Inlet’s west side to drill gas wells and hopes to bring a larger drill rig for drilling deeper wells aimed at finding oil. It’s worth noting these ventures are being aided by measured incentives put in place by the State. The redevelopment of Redoubt Shoal and the West MacArthur River fields is possible because of a temporary reduction of royalty extended to several marginal Cook Inlet fields some years ago, as well as a set of generous investment tax credits. The same tax credits are boosting exploration on the Kenai Peninsula and the effort to bring a jackup rig to the Inlet. A step at a time, these efforts could succeed in more oil and gas being produced, but if a larger company enters the scene, like Apache Oil, things will elevate to a new level.

Apache May Provide Boost

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Apache, a major independent company, has been acquiring leases in Cook Inlet over the last year with intentions to do exploration. The company has also indicated it is looking to acquire more properties. An obvious prospect is the Cook Inlet holdings of Chevron Corp., which are for sale. Included in this are the 10 offshore oil-producing platforms owned and operated by Chevron, and the majority of the Inlet’s oil-producing fields. Whether Apache will purchase these depends on whether the company believes the production can be expanded. The fields are mature, many having produced for several decades, and the platforms and wells are aged. In purchasing them, Apache would also be assuming large liabilities, mainly the cost of removing the platforms once production is terminated. However, having a company like Apache active in Cook Inlet will provide a big boost for others, an endorsement by a large and respected independent. What is also often overlooked is that another once-independent company, now part of a much larger one, has been www.akbizmag.com • Alaska Business Monthly • April 2011


operating two mature Cook Inlet oil producing platforms for years. This is XTO Corp. which purchased the platforms from Shell years ago, invested in redevelopment, and has continued to operate them profitably. The fact that XTO can continue to operate aged facilities provides an example for others, like Apache, looking at Cook Inlet.

Rebuilding the Industry

If there is to be another petroleumbased manufacturing industry for the Cook Inlet region, what might it look like? The two State gas corporations, the Alaska Natural Gas Development Authority, or ANGDA, and the Alaska Gas Development Authority, or AGDC, have both sponsored studies of possible industries. So has the State’s main industrial development corporation, the Alaska Industrial Development and Export Authority, or AIDEA. ANGDA commissioned a study of what it might take to rebuild and expand the existing LNG plant. It found that substantial amounts of money to upgrade the plant and meet new federal regulatory standards would be needed.

AGDC commissioned studies of a gasto-liquids project linked to a gas pipeline built from the North Slope. This might be possible if a pipeline is built. AIDEA has considered a different idea, a coal-to-liquids project based on large coal resources at Beluga across Cook Inlet from Anchorage. Coal-toliquids uses a process similar to that in gas-to-liquids, the Fischer-Tropsch process. Similar plants in South Africa, Qatar and Malaysia now make highquality fuels and other products from feedstocks like coal and natural gas. AIDEA found the coal-to-liquids idea to have possibilities. Tyonek Native Corp., a landowner in the Beluga area, is very interested in the idea. A Beluga coal-to-liquids plant would be within the Kenai Borough and part of its tax base. No doubt experienced service companies based in Kenai would play a major role in the development of such a plant. The closure of the LNG plant ends at least this chapter of the Kenai Peninsula’s history, but it’s worth reflecting on the success of the fertilizer and LNG plants as innovative industrial

ventures in their time. Large gas discoveries were made in the 1960s but they were found as companies searched for oil, a more valuable product. The gas was “stranded,” much like North Slope gas is today, with no way to move it to market. The idea that developed was that if the gas couldn’t be shipped in gaseous form, as there was no pipeline, it could be converted into a different form, even a new product, that could be shipped. Union Oil of California (now owned by Chevron) built a fertilizer plant to convert its gas into fertilizer, a solid, and ammonia, a liquid. These products could be shipped and sold readily. ConocoPhillips and Marathon built a LNG plant to liquefy the gas at low temperatures and ship it in special tankers. This was the world’s first long-distance shipping of LNG on a regular basis, and it pioneered the very large LNG business that exists today. Both ventures demonstrated private sector entrepreneurship in converting a problem – stranded gas – into an opportunity. There is no reason why this can’t happen again.  q

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GAS & OIL

Impact of Current Oil-Tax System Forces Alaskans to Make Tough Decisions In April 2007, FEX stacked the Doyon Arctic Wolf after drilling in northwest NPR-A. Cruz Construction moved the rig, shown throughout this article.

By Sandra Yi

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ave Cruz’s Alaska roots run deep. His first job was working on the trans-Alaska oil pipeline and he built a successful business servicing the North Slope. Now, Cruz’s family may have to uproot for new lands. “We have to follow the work, so we made the choice to move our oilfield support to North Dakota,” Cruz says. “North Dakota has a more favorable tax environment, they are more pro-business and they have a how-can-I-help-you attitude instead of what’s-in-it-for-us attitude.” As the president of Cruz Construction, a Palmer-based company that provides exploration support and tundra transportation to the oil, gas and mining industries, Cruz has experienced the impact of ACES oil tax (Alaska’s Clear & Equitable Share) directly. “In 2007 through ’08, we were able to employ a couple hundred people all winter,” Cruz says. “Now we’re able to employ a dozen. We had Anadarko, Chevron, FEX, Brooks Range, ConocoPhillips, Pioneer that were exploring on the North Slope. Today, we have only one exploration

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well that’s going to happen – and that will be done in March of this year.” Cruz is now one of the thousands of Alaskans supporting Gov. Sean Parnell and his call to restructure ACES, which was enacted in 2007 under then-Gov. Sarah Palin. It raised the oil production tax base rate to 25 percent, applied against the production tax value. It also set a progressivity rate of 0.4 percent, signifi-

Photos courtesy of Cruz Construction

cantly boosting taxes, particularly when oil prices are high. And, under ACES, as oil prices increase, the marginal tax rates can climb to more than 80 percent. Parnell’s House Bill 110 (HB 110) aims to lower oil production’s base tax rate from 25 percent to 15 percent for new field and adjust the production tax calculation on an annual basis instead of monthly. Although it doesn’t eliminate progressivity, it slows the rate at which it rises, and uses tax brackets. The bill would reduce the overall government profit, but it aims to restore the opportunity for earnings with more investments. “The state may still provide onesixth of the domestic oil supply, but the volume from existing wells is dropping steadily. We’re at risk of seeing irrevocable production decline, which threatens the pipeline. Our state needs to increase our competitiveness and grow our economy,” Parnell said.

Make Alaska Competitive Coalition Forms

After Parnell introduced HB 110, a group of Alaska organizations and individuals formed the Make Alaska

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Competitive (MAC) Coalition to educate Alaskans about the negative impacts the current oil production tax has on jobs and businesses. “We’re not arguing for the State to give the oil industry a handout,” said former Alaska Gov. Tony Knowles, member of the Make Alaska Competitive steering committee. “What we need is for the State to adopt a tax structure that encourages jobs and investment in Alaska. We need policies that work so Alaskans can go to work.” Alaska Department of Labor & Workforce Development’s research shows shows the oil and gas industry lost about 1,700 jobs since December 2008, when employment peaked. At a time when the industry is investing in the Lower 48 and foreign countries, it is not investing in Alaska. “Alaska must remain a competitive environment for oil companies to do business. If not, we all lose,” said Jim Jansen, CEO of Lynden and co-chair of the Make Alaska Competitive Coalition. “We are already starting to see the oil companies take their investment dollars elsewhere. This is a time when we

should be encouraging investment in Alaska, not taxing the industry to death.” The MAC Coalition’s supporters and steering committee members come from throughout Alaska and work in different business sectors. It includes Koniag President and CEO Will Anderson, Carlile Transportation Systems CEO Harry McDonald, former Alaska House Speaker Gail Phillips and Ed Rasmuson (the full list can be found at www.MakeAlaskaCompetitive.com). In addition to Knowles, two other former Alaska governors are

calling for reform: Govs. Bill Sheffield and Frank Murkowski. But MAC says the common bond is that supporters are all “Alaskans who rely on a strong economy for good jobs, commerce and healthy communities.” The coalition also says it’s committed to not accepting any funds from oil producers. “This is not big oil sending the message. This is your economy talking,” said Mark Hamilton, former University of Alaska president and MAC Coalition steering committee

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member. “The trans-Alaska oil pipeline is two-thirds empty and exploration activity on the North Slope is vanishing. This should be alarming to Alaskans and we intend to make sure the public is aware.”

2011 Oil Exploration

Last year, Alaska’s most active explorer, ConocoPhillips did not drill an exploration well for the first time in 45 years, and it says it has no plans to drill a well in 2011. In fact, while more than 900

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exploration wells were drilled across the United States last year, only one was drilled on the North Slope. This winter, only a lone exploration well is planned. “Thousands of more jobs are at risk,” Cruz said. “My own company is a microcosm of what’s happening throughout Alaska’s oil industry now and what will happen throughout Alaska’s economy soon if we continue to drive away investments with unfriendly taxes and regulations. Three years ago, we were flying high and

employed 200 Alaskans through the exploration season. Then came the ACES oil tax, and it was like someone turned off the faucet.” That trickle is also being felt in the trans-Alaska oil pipeline. At about 600,000 barrels per day, the pipeline is two-thirds empty, and in 2010, it declined by about 7 percent. It’s a scenario that has industry insiders pondering the question: How low can it go? At some point it will simply become too expensive for producers to continue to pump oil through the

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“North Dakota is competitive. Alaska is not. It’s as simple as that,” Hamilton said. “It’s not because North Dakota has more oil reserves. Alaska doesn’t have an oil resource problem. It has an investment problem.” For his business to survive, Cruz must follow the oil. Cruz Construction started working in North Dakota several months ago and now employs 40 full-time employees. “Alaska is losing investments to places like North Dakota where they understand that lower taxes and a business-

friendly environment mean more jobs, more business, more prosperity and a brighter future. Without the investments, we’re losing our future,” Cruz said. Cruz and his family love living in Alaska and the unique opportunities it offers. But the mountains, fish and sun-filled summers are no competition for security and job prospects. “Our parents left Alaska better for my generation. Our responsibility is to leave Alaska for the next generation. I built my career on oil in Alaska,” Cruz said. “What about my kids’ future?” q

pipeline or technical issues will force its closure. Some fear that day could come five to 10 years from now. “When that happens, Alaska is in for a rude awakening,” Hamilton said. “No flow means no dough. And, when the oil industry isn’t paying the bills, guess where the government will come looking. But even if we implemented a statewide income tax and abolished the Permanent Fund dividend, it wouldn’t come close to making up what the oil industry pays to State government.” Currently, the oil industry pays more than 85 percent of Alaska State government. And according to the Anchorage Economic Development Corp., revenue and employment resulting from oil and gas activity accounts for approximately 40 percent of the state’s economy.

The Lure of North Dakota

While Alaska struggles to encourage more exploration on the North Slope, North Dakota’s oil production has doubled in the last three years. More than 160 drilling rigs are active, and in less than a decade, projections show it will surpass Alaska, becoming the second-leading oil-producing state, trailing only Texas. Compare that to the North Slope, where the number of active rigs has dwindled to 12. North Dakota already has the nation’s lowest unemployment rate at less than 4 percent and the state projects it will add 25,000 new jobs this year. www.akbizmag.com • Alaska Business Monthly • April 2011

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Towns

in

Transition

By Heidi Bohi

Kodiak: The Emerald Isle

Photos courtesy of KICVB

Maritime hub increasing tourism to diversify economy

View of downtown Kodiak from the water.

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he City of Kodiak, consistently ranked as one of the nation’s busiest ports for seafood landings, is used to weathering the uncertain and volatile climate of the commercial fishing industry, which is often paralyzed by State and federal regulation and management decisions, complicated politics, and the unpredictable moods of Mother Nature. So when city officials look at the general ledger and see revenues holding steady in a sea of economic insecurity, instead of focusing on local issues that never go away – every community has them – they appreciate the city’s relatively healthy economy. This results from sales taxes that also indicate this coastal community of 6,261 people will realize a modest 2 percent growth this year. “We are not seeing anything that would give us any reason for concern,” says Aimee Kniaziowski, city manager. Stability has been the trend for the past

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several years and based on that tendency and other indicators, she expects this economic stability to continue.

Maritime Hub

The marine waters around Kodiak are among the most productive in the North Pacific and the area’s highly productive salmon industry results, in part, from more than 800 salmon streams. According to a National Marine Fisheries Service report, Kodiak remains the third largest port in the country – after New Bedford, Massachusetts and Unalaska-Dutch Harbor – when it comes to value of commercial fishery landings, with $103.8 million, up from $98.7 million the year before. Kodiak also is listed as the fourth largest port in the country when it comes to the volume of commercial fisheries landings with 282.9 million pounds. Commercial fishing and processing has been the mainstay of Kodiak since the early ’80s and currently accounts for

55 percent of the private-sector work force. The seafood industry employed nearly 6,600 people across the Kodiak Island region, with 3,664 employed in harvesting and 2,934 employed in processing. Besides the direct economic benefits of harvesting herring, halibut, cod, Pollock, crab, scallops and five species of salmon, the city is a hub for Southwest Alaska’s maritime industry and the local economy also benefits from support services for the fishing fleet and businesses supporting those employed by it. There are also several government and educational entities that operate fisheries-related research facilities including the Fishery Industrial Technology Center, which houses scientists who do research in fish harvesting technology, seafood science and processing technology. The multi-million dollar Kodiak Fisheries Research Center also is a research institute for State and federal researchers committed to the preservation, enhancement and management of North Pacific marine ecosystems and resources. The Kodiak Island Borough Assembly and the Kodiak City Council are considering cooperatively hiring a fisheries analyst to advise the two bodies on fisheries issues that impact Kodiak, Kniaziowski says, adding there is concern about recent reductions in halibut quotas. Based on the International Pacific Halibut Commission stock assessments and recommendations earlier this year, the Kodiak fishery could take a big hit. Area 3A, which is the central Gulf of Alaska, could drop to 14.36 million pounds, down 28 percent from 20 million pounds last year, and Area 3B, representing the western Gulf of Alaska, may be looking at 7.52 million pounds, which is a 25 percent decrease from 9.9 million pounds in 2010.

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Kodiak harbor is dominated by vessels in the commercial fishing fleet.

Tourism Growing

As the rest of the state suffers from double-digit downturns in the visitor industry, Kodiak holds its own, says Janet Buckingham, executive director of the Kodiak Island Convention and Visitors Bureau (KICVB). She said Kodiak is a more exclusive destination that benefits from repeat visitors who are high-end travelers with more disposable income. “Last year was anecdotally very strong and many charter boat fishermen said it was their strongest year ever,” Buckingham says. Although Kodiak is a fishing town first – followed by the U.S. Coast Guard and other government entities as major employers – tourism is growing as locals begin to see the economic development benefits associated with 30,000 to 40,000 visitors traveling to the “Emerald Isle, the second largest island in the United States after the Big Island in Hawaii, for legendary bear viewing and sport fishing. Last year, 22 cruise ships delivered 19,000 passengers throughout the summer season – this year ship numbers will drop to 15, in part due to the cruise lines redeploying vessels to European destinations. As is the case statewide, Buckingham says about 25 percent of cruise ship passengers end up returning to Kodiak as independent travelers once they have experienced local attractions. “They are walking into the authentic Alaska experience,” Buckingham says of both independent travelers and cruise ship passengers. Several improvements are under way to enhance pedestrian use and visitor satisfaction. The city

has budgeted $700,000 to design and construct a pedestrian-improvement project along the preferred route that takes cruise ship passengers from Pier 2 where the ships dock, along the waterfront canneries and processing plants. An additional $1.6 million, the result of the State cruise ship head tax collected this year, will be used for additional pedestrian and parking improvements along this popular street. The city will also install landscaping and other pedestrian amenities upon completion of a large water and sewer project to be undertaken in the main downtown area.

Marketing Focus

Looking ahead to the next couple of years, Buckingham says the KICVB will focus on marketing Kodiak to both the international inbound markets and the travel trade such as travel agents to capture part of the 72 percent of international travelers and about 35 percent of the domestic visitors who use travel agents when booking trips. Most do-

mestic inquires come from California, Texas and Florida. The international market comprises those from Germany and Canada, though Brazil is an emerging market. The 8,500-square-foot Kodiak Harbor Convention Center, completed in 2009, allows the community to also market to those wanting a place for meetings and small conventions up to about 430 people. “Travelers are looking for a unique experience and value and they are doing a lot of research on how to spend their money on what they perceive to be a unique world-class experience so it’s the perfect time for Kodiak to capitalize on this,” she says.

Housing Shortage

Although Kodiak has yet to address the housing shortage, especially during the peak summer tourism and fishing seasons when there is a big population influx, the city continues to advance other needed improvements. The new Kodiak Police Station was completed this winter, replacing what was the oldest public facility in the state. The $25 million, 28,250-square-foot facility includes police department operations, an emergency operations center, a jail facility that holds 22 adults, and two juvenile holding cells. In 2009, the city invested $17.5 million in the boat yard and boat lift project, and is in the pre-design stages to replace City Pier 3, which services inbound and outbound freight container shipments – a project expected to cost at least $18 million. Also in the predesign stage is a $13.5 million project to replace the 1960s-era library and a $2.9 million improvement project for Baranof Community Park. q

The new Kodiak Harbor Convention Center in downtown Kodiak.

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ALTERNATIVE ENERGY SPECIAL SECTION

Hydroelectric Advances in Alaska

Photos courtesy of AP&T

Above: The dawn of hydrokinetic energy in Alaska.

Left: AP&T’s Hydrokinetic River Turbine Project on the Yukon River at Eagle.

Harnessing cleaner, cheaper power By Vanessa Orr

L

iving in Alaska, one often deals with inclement weather. But while rain and sleet and snow can sometimes be an inconvenience, the elements can also be a benefit for residents wanting lower electric bills. Hydropower, or power that is derived from the force of moving water, has long been a source of energy in the 49th state and interest in this renewable resource continues to grow.

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Despite having earned a reputation as a leader in oil and gas production, Alaska also has made major inroads in harnessing this alternative natural resource. “To have hydropower, you need elevation and water, and we have lots of that, especially in Southeast Alaska,” said Scott Willis, vice president of generation, Alaska Electric Light and Power Co. (AEL&P).

Hydropower currently accounts for approximately 24 percent of the state’s power generation, and provides 100 percent of the electrical power in Juneau, the state’s capital city. “When you look at electric rates in Alaska, you can see that the communities with the lowest rates are those with the most hydroelectric facilities,” Willis said. “Our utility is paying the same price for fuel as it did in 1893,

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because the fuel we use to run our hydroelectric plants is water.” That’s not to say building a hydroelectric facility is cheap, however. “Building a hydroelectric plant is capital intensive – there are a lot of costs in building dams and tunnels and pipelines,” Willis said. “But while hydro facilities cost a lot to build, they are cheap to run. They last a long time, which provides for low, stable rates over the long term, compared to the cost of diesel generation, which can fluctuate quite a bit as the cost of oil rises. There’s no more inexpensive power generation than that provided by an ‘old’ hydro plant.”

Old Conception

While all the talk about renewable energy has brought the concept of hydroelectric power to the forefront, the fact is, Alaska has been using this form of energy for more than 100 years. “We’ve been in the renewable energy business since 1893,” said Willis of the utilitity’s Gold Creek Plant, a 1.6 MW run-of-the-river plant built that year, and then rebuilt in 1914 after the original powerhouse burned down. Juneau’s mines also needed power to run, which resulted in the 3.6 MW Annex Creek plant and the 6.7 MW Salmon Creek plants being built by mine owners. AEL&P bought these plants in the 1970s and still runs them today. Together, the Gold Creek, Annex Creek and Salmon Creek plants provide about 15 percent of Juneau’s energy demand. Snettisham, the largest hydroelectric facility in Southeast at 78 MWs, provides approximately 65 percent of the town’s energy needs. “One problem with hydro plants is their limited capacity; as demand grows, you reach the plant’s capacity,” Willis said. Snettisham came online in two phases to meet demand, with the second phase beginning in 1989. When that demand was exceeded in 2009, AEL&P started bringing the 14.3 MW Lake Dorothy Plant online, which was originally identified as a potential hydro site in the 1950s. The Lake Dorothy plant will be brought online in two phases, with the second phase getting under way as demand requires. www.akbizmag.com • Alaska Business Monthly • April 2011

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“Lake Dorothy meets 20 percent of the city’s demand, which now means that all of Juneau’s power is hydroelectric,” Willis said. “There are initiatives in many states to get more renewable resources into the generation mix, and Juneau is already there, which is a really remarkable thing.”

Mandating Change

While Juneau has successfully harnessed the power of its waters, other places in Alaska are working to do the same. In 2010, the Alaska State Legislature passed an energy policy that directs the state to receive 50 percent of its electrical generation from renewable and alternative energy sources by 2025. In order to do this, the Alaska Energy Authority (AEA) was given funding for the preliminary planning, design, permitting and field work required for the Susitna and Chakachamna hydropower projects, as well as other projects along the Railbelt. The Chakachamna project, located on the west side of Cook Inlet, would provide 330 MW of energy to the Railbelt grid. The Susitna project, which would consist of one dam at Watana, approximately 75 miles northeast of Talkeetna, would have a 700 MW capacity. Public meetings on the feasibility of these large hydropower projects began in February.

Low Impact Hydropower

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Alaska Power & Telephone (AP&T), an investor-owned utility based in Port Townsend, Wash., has also made major inroads in providing hydroelectric power to the 33 communities it serves in Alaska, a few of which are above the Arctic Circle, some are in the WrangellSt. Elias region, along the border with Canada, and on islands in Southeast. “Fifteen years ago, 98 percent of what we provided to our customers was fossil fuel energy,” said Mark McCready, director of marketing, AP&T. “In the last 15 years, we have flipped our portfolio so 70 percent of the energy we provide comes from small hydro renewable energy projects. This is a huge shift for us and for our customers as they are not nearly as subject to rate swings and the whims of the market as it relates to fuel costs. Beyond the economic benefit is a much less impacted and cleaner local environment.”

All of AP&T’s hydroelectric projects have received low-impact certification from the Low Impact Hydropower Institute (LIHI), except Black Bear Lake (because of its age). “In order for a project to receive the low-impact certification, it must meet certain water quality standards, fisheries standards, watershed protection standards and more,” McCready said. “We specifically seek to identify plant sites that won’t have an adverse impact on native species or create a big footprint.” One of AP&T’s most challenging projects to date is deployment of the first 25 KW low-impact hydrokinetic river turbine in the Yukon River near Eagle. The in-stream turbine, a fourblade vertical axis unit mounted on a floating platform, produces no emissions, requires no dam and poses very little risk to marine life. “We got the turbine up and running at the end of July of last year, and it ran for two weeks before we had some physical problems with the machinery that were overcome with the help of our supplier,” McCready said. “The bigger challenge was the nature of the project – harnessing the tremendous energy of the Yukon River itself. It is a huge, powerful river, and after a big rainfall, there were problems with debris coming down the river that clogged the turbine’s intake. The initial design of the diversion boom structure in front of the turbine didn’t prove to be successful. “At this juncture, before we put the turbine back into the water after spring breakup, our goal is to have the suppliers’ engineers and our engineers devise a better diversion option to enable the machine to remain in uninterrupted operation for longer stretches of time.” During the two weeks the turbine ran, it consistently fed 15 KW to 17 KW into the energy grid at Eagle. “There are more kilowatts to be had,” McCready said. “It simply boils down to refining the technology and the efficiency of the unit and coming up with a diversion structure that won’t compromise the flow. The benefits Mother Nature has to offer in terms of energy production are not easily nor cheaply harnessed, yet we hope to move the needle in terms of helping to mature this technology.”  q

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ALTERNATIVE ENERGY SPECIAL SECTION

Photos courtesy of Gwen Holdmann/ Alaska Center for Energy and Power

Geothermal exploration is happening 40 miles from Nome, at Pilgrim Hot Springs, seen here with a geothermal pool in the foreground.

Developing Alaska’s steamy resources By Tracy Kalytiak

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illions of years ago, near the place now called Chena Hot Springs, magma bubbled its way upward from deep inside the earth, solidifying into underground formations of granite rich in uranium and thorium. Those elements decayed, generating heat. “Granite rock isn’t sedimentary rock; it cracks really nicely in all different directions depending on where the stresses are,” said Gwen Holdmann, director of the Alaska Center for Energy and Power. “The rock itself is hot and that heat can be transported to the surface through

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circulating ground water. It’s very site-specific – you might be able to drill two miles deep and hit hot rock, but getting that heat to the surface is another matter entirely. You would need to have pathways for water to circulate through that rock, and then come to the surface either naturally, like at a hot springs, or artificially, by using a pump.”

Clean Renewable Energy

That heat generated by the earth itself is geothermal energy – a clean, renewable resource that puts water as hot as 700 degrees Fahrenheit to work pro-

ducing power in the U.S. and around the world in myriad ways. Geothermal energy – like that eventually harnessed five years ago at Chena Hot Springs – can produce electricity and heat, or cool homes and businesses and industrial complexes. “Although areas with telltale signs like hot springs are more obvious and are often the first places geothermal resources are used, the heat of the earth is available everywhere, and we are learning to use it in a broader diversity of circumstances,” according to the Geothermal Energy Association.

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Geothermal energy is considered renewable because the heat emanating from Earth’s interior is essentially limitless. It is estimated to carry the potential for 42 million megawatts of power and is expected to remain so for billions of years, ensuring an inexhaustible supply of energy. Hot geothermal water can appear on the surface as hot springs or geysers. Most geothermal water – known as geothermal geysers – stays deep underground. The use of geothermal resources has a long history. Romans used geothermal water to treat eye and skin disease and, at Pompeii, to heat buildings, according to the Geothermal Energy Association, and medieval wars were even fought over lands with hot springs. The first known “health spa” was established in 1326 in Belgium at natural hot springs. And for hundreds of years, Tuscany in central Italy produced vegetables in the winter from fields heated by natural steam. Tuscany is also where, in 1904, people built the first geothermal power plant, at a place where natural steam was erupting from the earth.

Alaska’s Projects

The Alaska Energy Authority lists ongoing geothermal energy projects at Mount Spurr, Mount Markusin, Manley Hot Springs, Pilgrim Hot Springs, Naknek, Tenakee Hot Springs, Pelican and Hoonah, Akutan, Bell Island and on the Seward Peninsula, as well as developments at Bernie Karl’s Chena Hot Springs, which has been operating for approximately five years. Some of these locations may be practical for small-scale geothermal development, while the AEA estimates Mount Spurr and Mount Markusin could support larger-scale power production. Holdmann says a $4 million U.S. Department of Energy award, matched with $700,000 in State-matching funds, became available last year and is being used to test innovative techniques for identifying and quantifying low- and moderatetemperature geothermal systems similar to the one at Chena Hot Springs. “That’s one thing we’re actively working on here at the University of Alaska Fairbanks,” Holdmann said. “The issue is that drilling is very expensive for geothermal systems. What

Alaska Center for Energy and Power student researcher Peter Illig collects data at Granite Mountain geothermal resource near Buckland on the Seward Peninsula.

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Geothermal bathhouse used by residents of Tenakee Springs, a Southeast community of about 100 people located on Chichagof Island.

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we’re trying to do is see if a resource is developable by doing airborne surveys instead of just drilling. We’ve been using techniques that have been developed at the university for studying volcanoes and underground coal fires.” One of the airborne surveys last fall was done about 40 miles from Nome, at Pilgrim Hot Springs. Researchers will be verifying that airborne data with a ground-based survey, to determine whether heat seen at the surface with infrared photography comes from a geothermal source rather than being from heat absorbed by the sun, vegetation or different slope angles. “Our researchers will be able to process out all that noise using advanced computer algorithms and get a good idea how much is geothermal,” Holdmann said. Most of the $4 million, Holdmann said, is paying for drilling to verify the airborne- and ground-based research results. In addition to drilling, the main challenge to establishing geothermal energy sources for communities in Alaska is proximity of those resources to places where people live and the high costs of transmission infrastructure. “The cost of transmission is the showstopper for many otherwise viable geothermal projects,” she said. “Another issue is land ownership. In places like Manley and Tenakee Springs, there’s a lot of private land ownership, people who have different ideas about whether

that resource ought to be developed. For example, when you develop a resource like Chena Hot Springs, you impact the resource. It might be reversible but some people might not want that.”

Regulation and Taxation

Alaska legislators last session passed a bill sponsored by State Sen. Lesil McGuire, which established a 1.75 percent royalty obligation for gross revenues derived from the production, sale or use of geothermal resources under a lease during the first 10 years immediately after the geothermal resource first generates gross income. After that first 10 years, the royalty obligation would rise to 3.5 percent of the gross revenues. The bill also transferred authority from the Department of Natural Resources to the Alaska Oil and Gas Conservation Commission over permitting and inspection of geothermal wells, and provided for a regulatory cost charge for geothermal wells. The bill, signed into law, took effect July 1, 2010.

Exploration and Development

Exploration and development of geothermal resources is occurring at the volcanic island of Akutan, 730 miles west of Anchorage, where exploration drilling took place last summer. Located in the heart of the Bering Sea fishery, Akutan is home to North America’s largest seafood plant, owned by Trident Seafoods, which processes more than 3 million

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pounds of fish products per day. The addition of a new harbor, a project to build a new airport and marine link and other capital improvements, as well as existing demand, indicate power demand could easily top 10 megawatts during the next several years, a 2010 Alaska Business Monthly article stated. “They identified the resource, have a good idea where to drill and develop a project,” Holdmann said. “They’re seeking funding to move forward.” An estimated $40 million cost of transmission is the main obstacle for development of the Nome’s Pilgrim project, which has the potential for generating 5 megawatts of power for a community that needs between 5 MW and 10 MW. Nome, now, relies on diesel fuel. In 2007, Nome Joint Utilities spent $2.6 million for diesel. “This could potentially displace almost all of that,” Holdmann said. “But it’s 40 miles from Nome. Transmission is the deal-breaker for these kinds of projects.” Mount Spurr is the project with the most significant potential for Railbelt power customers. Paul Thomsen, director of policy and business development for Ormat Technologies, told the Alaska House Resources Committee on Jan. 24 that the company’s summer 2010 small-bore drilling program on Mount Spurr volcano, located on the west side of Cook Inlet, confirmed the likely existence of a significant geothermal source. Ormat has had 15 leases of 36,000 acres of State land on the south flank of the mountain since September 2008 and, Thomsen said in January, has invested about $5 million in the project. The company operates geothermal plants and other facilities in 71 countries and has worked on projects in Alaska since 1975. Slim-hole drilling is expected to continue this year to depths of up to 4,000 feet. Next year, he said, Ormat could drill a full-sized production well to see if there is a commercially viable geothermal reservoir. What the Mount Spurr projects needs to proceed is a power-purchase agreement and a State commitment to spend $70 million to $80 million for 25 miles of permanent access road and 40 miles of T-line to Chugach Electric’s Beluga plant – Chugach intends to start a detailed routing study this year.

If Mount Spurr gets a power-purchase agreement and a State commitment to build the transmission infrastructure and road, the geothermal plant Ormat builds could provide an estimated 50-100 MW net, to the Railbelt power grid. Ormat has been using a $2 million grant from the Alaska Energy Authority, with the company matching that grant with $2.1 million of its own money. The company has been recommended for a further $2 million AEA grant, subject to further company expenditure in excess of $3 million.

Last year’s Senate Bill 243 took one cent off the projected power rate, but additional incentives will be needed to enable geothermal to compete on a straight-cost basis, Thomsen said. “If the State wants to help us with that gap (between current power prices and the potential cost of geothermal), we can offer the ratepayers a much lower price,” Thomsen said. “If the State can’t help us with that, we need to offer the ratepayers a higher price, and that could or could not make the project viable.”  q

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REAL ESTATE

Southeast Real Estate Panhandle prefers winter sales

Photos courtesy of Nicole A. Bonham Colby

In a trend that would surprise real estate sales experts down South, winter and fall remain the best times to list a house in Ketchikan, according to agents.

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s the Lower 48 real estate sales market goes, so Southeast Alaska does not go – at least according to local agents. Instead, winter is surprisingly the time to list a home in the Panhandle.

Don’t Clutter Our Summer

When homeowners down South are tidying their houses to list in the spring, Southeasters are busy getting ready to savor the blissful months of favorable weather in summer for work and play, not necessarily to sell their homes. Instead, the Panhandle’s primary home sales season is winter, when folks have ample time to think about a new purchase and to coordinate a move.

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“Southeast’s economy is seasonal to a great degree and it’s based around the summer months,” says one long-time agent who has sold houses in southern Southeast for 16 years. “So the typical cycle in real estate in Southeast, at least Ketchikan, things right after holidays pick up and go constant until middle of April. That’s about the time the weather gets really nice and people get outside.” The listing season slows from April to July, as residents cram a year’s worth of outside activity into a few precious months. Then home listings jump again after July 4th through December, when there is a lull for the holidays and the cycle restarts. For many, the timing of listing a

home is driven by a variety of external factors – a need to relocate for work, financial pressure to sell quickly, and even an opportunity to move up to a nicer or larger property. So, unlike the Lower 48, where the late spring listing cycle is almost concrete for those wishing to take advantage of families relocating or to coordinate a move when children are out of school, the Southeast Alaska market is seen as more insular, according to industry watchers.

Recent Market Distortions

Even the best-laid plans for home sellers and buyers across the nation were disrupted by recent distortions in the real estate market. Between the fallout

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of the subprime lending and subsequent wave of foreclosures, nothing is normal in the market of late. However, agents say, if you can look beyond those surface fluctuations, there is still some trend data to recognize. In Ketchikan specifically, the last 12 years has been one of sharp ups and downs, though the local market perhaps weathered the extreme fallout of the Lower 48 housing crisis a bit better than most. In the late 1990s, the local pulp mill shut down and the market predictably declined through 2002, when it bottomed out having taken a 15 percent to 20 percent hit, according to industry watchers. The market aggressively recuperated by 2004 and 2005 with an upswing of up to an 8 percent to 12 percent range of appreciation. Then, in the fall of 2008, following the financial crash, local sales activity went to almost zero for the next several months. One agent reported an “incredible lack of confidence in the marketplace.” But by spring of 2009, local sales agents saw limited recovery, with some price runoff – a 5 percent to 7 percent drop in local market prices. Compared, however, to the ongoing crisis visible in Lower 48 cities like Las Vegas, Phoenix and elsewhere, Southeast Alaska’s data is surprisingly stable. While the region remains a buyer’s market, agents are not seeing huge discounts necessary to simply sell houses.

Commercial Activity

In the commercial property realm, the trends are less obvious or easily tracked. The plaza property in Ketchikan has seen renewed occupancy – and from businesses more typical of mall traffic. If any commercial distress is obvious, it is tourism related. At the height of the downtown in tourism traffic, tenants could pay upward of $50,000 simply for the privilege of a prime lease space. In those days, the lease rate was reportedly upward of $10 per square foot. Now, if tenants are paying $4 or $5 per square foot, it’s considered high.

Rental Track

In the rental arena, a number of unrelated factors played a role in the decreased rental market. For the last

Summer is best kept for outdoor activities for southern Southeasters, who typically sell their properties in two periods: mid-January through mid-April, and mid-July to early November. Some agents attribute the counterintuitive trends to Southeasters’ saving warm-weather summer months for outdoor activities — work and fun.

four years, a number of construction projects kept regional rental activity high. The past winter saw a more typical cycle, with a 20 percent vacancy rate from November through February. The efficiency apartments and smaller units that are good seasonal rentals are predictably vacant now. “After last summer, a lot of people

went into this winter without a lot of expansion plans,” one agent reported. Projections for next summer look better from the tourism-impact factor, as ships are increasing activity, including much-anticipated Disney-branded ships. “Everyone is looking forward to next summer as the restarting of upward growth.” q

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TECHNOLOGY

Techy Gadgets Practicality for Alaska’s business leaders By Kent L. Colby

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Photo courtesy of Wilson Electronics Inc.

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echnology can change your life. The evidence of that is far reaching. While the intent of this article is not life changing – it is highlighting practicality in the technology available to Alaska’s business and general consumer communities, with the added advantage of simultaneous broad, and useful, applications. There are obvious technology advancements business users and general consumers simply cannot live without – or at least, cannot ignore. Those include milestone advancements, such as the iPhone, iPad, Androids and the thousands of “pad” computers and supersmart phones evident at the annual Consumer Electronics Show (CES) this past January in Las Vegas. At last count, there were more than 300,000 applications, or apps, for the iPhone and iPad – more than 100,000 for the Android. Whether you are traveling on a plane in cramped space, relaxing at home, or reading a business report after hours in bed, published material is fast becoming mostly electronic. Nowadays, you can read whatever you like – whenever you like – without the social stigma that goes with the hot artwork on the cover of your favorite paperback – thanks largely to the Nook, Kindle, Sony or multitude of compatible apps for your phones and pads. Nevertheless, there are already volumes of published material devoted to these best selling must-haves. Most likely, the majority of readers already have one or more of these devices; and most likely a two-year or more contractual commitment to a favorite carrier to go along with it. With that in mind, this article points you in the direction of something new – techy toys that offer practical application.

Wilson Electronics DB Pro Kit is a home or office signal booster.

Everything’s Better With More Signal On It

Even the smartest phone is limited when wireless coverage is limited. If your home or office is on the edge of wireless coverage, you have most likely uttered an expletive or two about dropped calls. Enter Wilson Electronics Inc. This small, techy company offers in-building and incar sophisticated signal boosters to improve wireless coverage. Alaska’s rough terrain creates considerable dead or seemingly dead zones, and/ or spotty coverage, for all our carriers – some more than others. But this compact (antennas sold separately) SIGNALBOOST™ raises the floor and smoothes the dips in signal. The big advantage is these devices require no physical contact with your phone. They do have direct-connect

models. But the wireless bi-directional booster, while a bit more expensive, is more diverse because it can be used by multiple phones, and works with all cell phones and data cards. It is simply an amplifier, or repeater. But it will bring you inside from the cold – or, in my case, from standing on one leg, on a rock, under the spruce in the front yard just to find the single location on my property where I can complete a cell phone call. With this innovative device, an external antenna picks up the weak signal, amplifies it, and rebroadcasts it inside the auto, truck, RV, boat, home or business. Models are available for all cellular frequencies and it doesn’t matter if CDMA, GSM, G3, or G4 (dual band 800-1900 MHz). There are models for a single room, or entire home or office. Not only does it minimize dropped calls, you can expect faster data rates and increased coverage. Perhaps this product is not as glitzy as the new Android or iPhone, but it will make them work better. Find out more online at www.wilsonelectronics. com. That said, no: it does not extend a Wi-Fi cloud.

On the Road Again and Can’t Wait to Get Your Cell Phone Plugged In

When you have to read your boarding pass to remember which airport you are at, or the TSA blue shirts know you by name, you qualify as a seasoned traveler. I am not to that point, but I do spend a lot of time in airports ready to leave on a jet plane. Seems wherever I go, I am scrambling to find a charger for my laptop, phone or both. Oft times, it requires a homerun slide to beat another traveler to the single remaining

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If you look at this type of information, the charger is RoHS (Restriction of Hazardous Substances Directive) compliant. Good to know. Find out more online at www.targus.com/us/powerall.

Don’t Get Lost in the Name of Adventure

Alaskan’s have more space for outdoor adventure than just about anyone else in the country. Busy executives chained to a desk or airplane 24/7 must break the ties periodically and appreciate time for themselves in Alaska’s big country. For such occasions, it is a good idea to keep track of yourself, and let others know where you are, as well. Outdoor enthusiasts know the name DeLorme and the company’s accomplishments in the mapping and GPS arenas. DeLorme has helped us keep track of where we are for years now. At January’s CES, DeLorme demonstrated its unique GPS navigation and communication capabilities utilizing the custom-text messages of SPOT satellite technology. Now our families and friends can track us. Better yet, when you are in trouble from a life-threatening event or other critical emergency, SPOT, using the GEOS International Emergency Response Center, alerts the appropriate agencies worldwide. With the DeLorme SPOT team, you now have a new way to explore in the Last Frontier and to do it safely. Whether on the inland waterways or the coastal waters of Alaska, the trails and back roads, even outside cell coverage, the rugged DeLorme GPS keeps you on track. Paired, the two products allow you to send text messages and to e-mail accounts and social network sites. Emergency SOS is included. “This is really two great products in one,” says company Vice President Caleb Mason. “DeLorme and SPOT have both pioneered a number of firstto-market innovations. Combining our unique GPS capabilities with SPOT’s satellite delivery has produced a oneof-a-kind navigation and communications solution, for peace of mind wherever you go.” The SPOT product uses both the GPS satellite network to determine your location and the Globalstar network to transmit messages and GPS coordinates to others, including an

Photos courtesy of Kodak/Sakar International

outlet on the end-row seat, under the window, next to the snack bar, or in those few places where there are actually traveler-centric power stations. Then the question is which to charge: the power-hungry laptop, so you can finish the PowerPoint presentation, or the phone, so you can call your client to convey arrival and meeting times. Not much we can do about airports that are behind the business-friendly curve, but we can recommend a new lightweight, dual-function charger. The Targus Premium Laptop charger is thin, it multitasks and it is good-looking. The AC model weighs in at 11 ounces. Better than the weight is its shape and size. It is about the size of a BlackBerry or external hard drive, which makes it one of the smallest chargers on the market. The power prongs fold in, out of the way, and are less bulky. The product offers added portability, and swivels to fit into either horizontally or vertically oriented outlets and not block adjacent outlets. This half-pint charger is big enough to charge your laptop and phone. Ideal for travel, the APM69US comes with nine laptop tips, one miniUSB tip for cell phones and cameras, and one iPhone tip. With the masses of air travelers behind you, there is an included 12-volt adaptor for use in the rental car. Targus attempted to cover everything with this charger. It has a thin, light-weight cord that includes an elastic band for cable management. All tips clip easily into an integrated storage clip that clips to the power cord, keeping them with the charger. Register your charger with Targus and receive an additional free tip for the second laptop and/or cell phone and free tips for future laptops and cell phones. Long-term compatibility: What a novel idea. The only downside, the power cord does not have a hidden wraparound on the charger itself. Consequently you have the charger and the “thin, lightweight” power cords to keep track of. The upside, even with the cords, is that the product is about half the size of the charger/power supply that came with your laptop. If you carry a laptop that has a power brick that requires its own wheeled case, check the compatibility list before you buy.

Kodak offers free standing or tri-pod mountable, full-featured webcams.

international rescue coordination center. The idea is: Peace of mind wherever you go. Explore and stay connected. Find out more online at www.delorme.com.

When They are Not at Home

Sakar International is expanding its family of Kodak Webcams with affordable models for Macs and PCs. These cameras are in the $19.99 to $29.99 range (MSRP). These hard-working cameras make video calling affordable and easy with clear full-motion live images and still-image capture at up to 1.3 megapixels. And check this out, they come with built-in parental controls. At just $19.99 the KODAK S101 Webcam offers one-touch emailing, built in noise-canceling microphone, plug-and-play USB with no need to

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Photo courtesy of DeLorme

the webcam to mount on most DeLorme Earthmate LCD displays or GPS PN-60w with stand alone on SPOT Satellite the desktop and Communicator. it comes with a mini-tripod. These Kodak cameras also offer drag-anddrop image uploads to social networking and image sharing sites. The twounit option – t h e K O DA K Dual Webcam D101 Twin Pack download drives, and is compatible (MSRP $59.99) – offers one to keep with Windows 7, Vista, XP and Mac and one for the kids away at college, OSX 10.5x and above. The $29.99 your vacation on the sandy beaches model (KODAK Dual Webcam D101) of the Caribbean, or business partners compliments all the features of the S101 on a skiing trip to Aspen or Salt Lake and adds a special form factor to allow City. Video chat is the way of the future

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and these inexpensive Kodak cameras simplify video chatting over services such as SKYPE and YAHOO!, AOL and MSN Instant Messenger as well as Google Talk and iChat AV for Macs. Even in the boardroom, these cameras will pull the video conference together. Using one of these cameras, you can share the day’s activities from home and the office. They open a completely new world of video recording and photos, drag-and-drop uploading, and noisecanceling microphones, mini-tripods and other accessories. They run at a full 30 FPS. They are face-detection and motion-detection capable. Sakar International Inc. designs and manufactures a wide range of technology, toy and consumer electronic produces. Find more information online at www.sakar.com. Kodak helps consumers, businesses and creative professionals unleash the power of pictures. Find out more online at www.kodak.com/go/followus.  q

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APR

16 A l a s k a T h i s M o n t h

By Nancy Pounds

Young Alaskans Celebrate KidsDay Photos courtesy of Anchorage’s Promise

Imaginarium, museums, other attractions free for a day With the help of Fire Station 1, hundreds of children explore fire safety and become familiar with emergency services.

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he siren call of “free” beckons like none other. This month, “KidsDay” will again provide free attractions to children in Anchorage. Area families can discover hours of adventure by visiting KidsDay Central and then one of many Promise Partner locations such as the Alaska Zoo, Anchorage Museum or Imaginarium, among others. KidsDay is April 16 from 10 a.m. to 4 p.m. The Dena’ina Civic and Convention Center features more than 100 exhibitors and a street fair on two adjacent side streets. Other locations included in KidsDay are the Alaska Zoo, the Alaska Aviation Heritage Museum, the Alaska Museum of Natural History, the Anchorage Museum at Rasmuson Center and the Imaginarium, the Alaska State Troopers Law Enforcement Museum and the National Park Service public lands information center.

Nurturing Way

Anchorage’s Promise – the Alliance for Youth, a nonprofit organization, coordinates KidsDay. The group also works with community groups, schools, businesses and parents to foster services and awareness of ingredients for nurturing children. The recipe includes caring adults, safe places to build academic and other skills, healthy lifestyles, effective education and opportunities to serve others. “KidsDay is about fun, exploration and encouragement,” said Debbie Bogart, executive director. “Most importantly, it is about helping all young people know they are cared for and supported by their community and their families.”

History

The event began in the 1980s and was coordinated by the nonprofit organization Kids Place Project, Bogart said. In 2004, Anchorage’s Promise took over as KidsDay organizer. Anchorage’s Promise began working with youth-service programs and community groups aiming to increase participation. Today, about 15,000 people participate at the various venues. One of the biggest changes throughout the event’s history was moving from the Egan Civic and Convention Center to the larger Dena’ina Center, Bogart said. “This

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During KidsDay, more than 100 youth-oriented vendors provide creative and fun learning activities that draw parents to their exhibits to learn more about the resources they can access.

allowed us to stretch, add more exhibitors,” she said. New venues are added by organizers each year. In 2009, KidsDay organizers coordinated a visit by baby kangaroos; in 2010, two baby Bengal tigers were featured. This year’s special animal will be announced closer to the event date. Also, two entertainment stages will feature performances by young people, and 150 youth volunteers will help during KidsDay. “KidsDay provides an opportunity for our community to celebrate Global Youth Service Day,” Bogart said. The international event highlights learning through serving others with a weekend marking the effort set for April 15-17. Anchorage’s Promise also coordinates service-learning classes for middle and high school teachers. Last year KidsDay organizers gathered input from the teen volunteers to help structure the event with increased appeal to teens, Bogart said. Plans include an open mic and local performances in music, dance and drama. Teen City Center Stage will provide an opportunity for teens, who have grown up with KidsDay to return with activities geared toward them. The event also will feature a fashion show, doodle tables for leaving ideas and thoughts plus teen information booths to provide information on volunteer opportunities.

A Good Place for Youth

A representative of America’s Promise will attend the event to officially recognize the Municipality of Anchorage as one of the nation’s 100 Best Communities for Young People, Bogart said. KidsDay exhibitors say the event provides an opportunity to connect with community members and increase participation in program services. KidsDay participants have told Bogart the event provides them with new, affordable ideas about activities for their families. After the long hours coordinating KidsDay, Bogart’s personal favorite aspect is seeing excited, smiling children delight in the activities. She treasures watching “families enjoy a day with each other and knowing just how much our community cares about each and every young person.” For more information, visit www.anchoragespromise.org. q

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4/7

Thursday Night at the Fights

4/9

Anchorage Museum at Rasmuson Center

Boxing a full round of seven matches with full bar and concessions available. Reserved seats $35.00, general admission $16 (prices include service charge). Tickets at the door. Held at the Egan Center with doors open at 6:30 p.m., event at 7:30 p.m. Contact: 263-2800.

The annual Anchorage Museum gala is one of the season’s most celebrated social art events. Guests enjoy fine food, wine and decadent desserts at the Dena’ina Civic and Convention Center. The gala features a live and silent auction of some of the state’s best original art. Funds raised help support the museum’s exhibitions, community and education programs, and the permanent collection. Dena’ina Center. Contact: 907-929-9200 or 907-929-9201.

Alaska Custom Cycle Show

4/9 – 4/10

Check out the coolest motorcycles in Alaska! Enter your motorcycle into one of the many classes available at www.amcda.com. This event will have door prizes, live demonstrations, vendors, food and entertainment! A great way to kick off the riding season and see what local motorcycle dealers have ready to ride. Ben Boeke 10 a.m.-5 p.m. Contact: 907-229-2055 or 907-279-9748.

Walk MS

4/16

Get your exercise with the pledge-based 4-mile walk around Lake Hood in Anchorage. Proceeds benefit the MS Society Alaska. Join hundreds of other walkers and see first-hand the powerful, positive effect the Walk MS has on everyone involved. Millennium Hotel, 8 a.m. registration, 10 a.m. walk. Contact: 907-562-7317.

Spring Fling for Women Trade Show

4/16 – 4/17

DAMM Straight Productions Inc. presents the “Spring Fling for Women” trade show. Time is to be determined. Held at the Egan Center. Contact: Michael Fisher: 907-344-1007.

Ed Asner as FDR

4/17

A one-man play starring Ed Asner as President Franklin D. Roosevelt. Watch as FDR explores the life of one of America’s best-loved presidents and the events and decisions that shaped a nation. A powerful play follows the iconic president as he reflects on his years in office, from inauguration to the trials of World War II. Discovery Theater, 2 p.m. and 6 p.m. Contact: 907-263-2787.

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4/5 – 4/9

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Tesoro Arctic Man Ski & Sno-Go Classic

Thousands of extreme skiers and snowmachiners gather east of Fairbanks every spring for days of practice and fun, culminating in this extreme winter race. Skiers take a lone descent before grasping their snowmobile partner’s tow rope for an adrenalinefilled climb at speeds ranging from 70-90 mph. Then a final plummet to a finish line in front of thousands of people. Race is scheduled to start April 8 at 1 p.m., awards ceremony scheduled for 6 p.m. April 9, with raffle drawing at 10 p.m. Contact: 907-456-2626 or visit www.arcticman.com.

4/15

Fairbanks Outdoor Show

Fishing charters, hunting expeditions, boats, ATVs, trailers, rafting, kayaking, outdoor gear and wear, fishing and hunting supplies, camping supplies, taxidermists and much more. Come see the more than 140 vendors from all over Alaska and the Lower 48. Informational seminars throughout the day include how and where to fish, outdoor safety and much more. Carlson Center. Contact: 907-451-7800.

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Alyeska Ski & Snowboard Bus

Every Weekend

Looking for an easy way to get to Alyeska from Anchorage or Eagle River? The Alyeska Ski & Snowboard Bus is your ticket to skiing and riding at Alyeska Resort. The bus is open to all ages, offering trips on Saturdays and Sundays from four Carrs/Safeways. Round-trip bus transportation and all-day lift ticket for one great price is new this winter and only available online at www.alyeskaresort.com – click on Mountain, then click on Alyeska Ski Bus. Contact: 907-754-2274.

Alyeska Spring Carnival & Slush Cup

4/22 – 4/24

With one of the longest ski seasons in North America, Alyeska Resort embraces spring in typical Alaskan fashion. The Spring Carnival takes advantage of the long days with extended hours of lift operations, great spring-skiing conditions, and Alyeska’s largest and most popular winter event, Slush Cup, where competitors dressed in zany costumes attempt to skim across a 90-foot long pool of freezing water. Other activities include a team tug-of-war, kid’s fun races, Big Air comp and live music. Contact: 907-754-2111.

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The Alaska Folk Festival

4/11 – 4/17

The Alaska Folk Festival brings the entire town of Juneau together for performances ranging from school groups to professionals to at-home hobbyists. Many people come from miles away to see and participate in this festive week-long event. Admission is free. Contact: 907-463-3316 (8102).

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ComFish Alaska

4/14 – 4/16

ComFish Alaska, Kodiak’s annual fisheries trade show for Alaskan Commercial Fisheries features seminars and forums, vendor booths and fisheries education. The Kodiak Chamber of Commerce started ComFish in 1980 as a marine trade fair to be held in conjunction with the annual Crab Festival in May. It continued to grow each year as more vendors wished to participate and is now a very popular venue for residents, commercial fishermen, the U.S. Coast Guard and other visitors. Experts are invite to speak about issues concerning Alaska’s commercial fishing industry. More information at www.comfishalaska.com.

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4/16

Wasilla Community Health Fair

4/17

An Evening with Randy Newman

4/30

Mat-Su Walk & Roll for Hope

Valley Residential First Presbyterian Church of Wasilla is offering free health screenings, health education and low-cost blood tests for age 18 and older: chemistry/hematology blood test $45 (panels 27 different functions, fast 12 hours prior) thyroid blood test $30, prostate blood test $25, Vitamin D blood test $50. A1C blood test $25. Drink lots of water. Bring a stamp for results to be mailed. Runs 9:00 a.m. to 1 p.m. Contact: 907-278-0234. Regarded as “One of the most venerated songwriters of his generation” by USA Today, film composer and musician Randy Newman. Witness an American music legend as he performs favorites including: “Louisiana,” “Leave Your Hat On,” and “You’ve Got a Friend in Me” from Toy Story. He is an Oscar-winning, five-time Grammy winner as well as a three time recipient of Emmy award. Join the free pre-performance talk led by a local expert at 6:30 p.m. On occasion, the artist joins as well. No ticket necessary. Starts 7:30 p.m. Alaska Center for the Performing Arts. Contact: 907-263-2787.

Join Hope Community Resources for a day of fun and fundraising in the Mat-Su Valley. Suitable for all ages. Check-in at 8:30 a.m. at the Menard Sports Complex in Wasilla, walk starts at 9 a.m. All funds raised go to support Alaskans who experience disabilities in the Mat-Su Valley. Information at www.hopealaska.org or contact: 907-433-4916.

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www.akbizmag.com • Alaska Business Monthly • April 2011


Alaska Trends

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

Personal Income Outpaces Inflation Anchorage versus U.S.

S

ince the United States was taken off the gold standard and changed to a full fiat currency in 1971, inflation has become a significant concern among its citizens. The effects of inflation reduce the value of currency over time and therefore increase the price of goods. As a result of this phenomenon, a dollar received today has more value than a dollar received tomorrow. This continual devaluation of currency undermines the savings of the citizenry; it requires the earning of interest or appreciation of principal to maintain the future equivalent value of current savings (preserving the individual’s purchasing power in the future). The chart shows the cumulative increase in personal income and inflation (as measured by the consumer price index) for Anchorage, Alaska, and the U.S. since calendar year 2000. While the inflation figures for Anchorage and the U.S. are very similar, with Anchorage experiencing 0.61 percent higher cumulative inflation, the personal income of Anchorage and the U.S. show a substantial

divergence. Anchorage’s cumulative increase in personal income is approximately 17.15 percent greater than the overall United States. This chart illustrates that when taking inflation into consideration, the personal income for those individuals in Anchorage would have increased 43.48 percent since calendar year 2000 in comparison to 26.95 percent for the United States. The additional 16.54 percent increase in purchasing power in Anchorage over the United States suggests the relative prosperity of Anchorage residents has increased in relation to the overall United States.  q

Source: Personal Income: http://www.bea.gov/ (Personal Income), http://www.bls.gov/ (Consumer Price Index)

Alaska Trends has been brought to you this month courtesy of American Marine/Penco

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Alaska Trends Indicator

Units

GENERAL Personal Income – Alaska Personal Income – United States Consumer Prices – Anchorage Consumer Prices – United States Bankruptcies Alaska Total Anchorage Total Fairbanks Total EMPLOYMENT Alaska Anchorage & Mat-Su Fairbanks Southeast Gulf Coast Sectoral Distribution – Alaska Total Nonfarm Goods Producing Services Providing Mining and Logging Mining Oil & Gas Construction Manufacturing Seafood Processing Trade/Transportation/Utilities Wholesale Trade Retail Trade Food & Beverage Stores General Merchandise Stores Trans/Warehouse/Utilities Air Transportation Truck Transportation Information Telecommunications Financial Activities Professional & Business Svcs Educational & Health Services Health Care Leisure & Hospitality Accommodation Food Svcs & Drinking Places Other Services Government Federal Government State Government State Education Local Government Local Education Tribal Government1 Labor Force Alaska Anchorage & Mat-Su Fairbanks Southeast Gulf Coast

152

Period

Latest Report Period

Previous Report Period (revised)

Year Ago Period

Year Over Year Change

US $ US $ 1982-1984 = 100 1982-1984 = 100

3rd Q10 3rd Q10 2nd H10 2nd H10

31,373 12,590,671 195.46 218.58

31,373 12,590,671 195.46 218.58

30,284 12,156,914 193.456 215.935

3.60% 3.57% 1.03% 1.22%

Number Filed Number Filed Number Filed

December December December

92 64 14

73 54 13

84 63 14

9.52% 1.59% 0.00%

Thousands Thousands Thousands Thousands Thousands

December December December December December

331.04 188.12 43.55 35.02 33.12

331.71 186.86 43.45 35.35 33.95

326.93 186.19 42.79 34.76 32.65

1.26% 1.04% 1.77% 0.75% 1.43%

Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands

December December December December December December December December December December December December December December December December December December December December December December December December December December December December December December December December December December

308.2 33.6 274.6 14.1 14.0 12.0 12.6 6.9 2.9 61.0 5.8 35.3 6.0 10.0 19.9 5.4 2.9 6.2 4.2 14.6 25.0 41.7 29.9 28.8 6.4 18.5 11.2 86.1 16.5 25.9 8.0 43.7 25.2 3.8

311.7 38.5 273.2 14.2 13.9 11.9 13.9 10.4 4.7 60.6 5.9 34.9 5.9 10.0 19.8 5.4 2.9 6.3 4.2 15.0 24.6 42.7 30.7 26.8 5.9 17.4 11.4 85.8 16.2 26.3 8.2 43.3 25.0 3.8

307.2 34.7 272.5 14.6 14.5 12.2 13.6 6.5 3.0 61.6 6.0 35.6 6.3 10.1 20.0 6.3 3.0 6.4 4.2 14.4 24.5 39.7 28.8 28.7 6.2 18.6 11.5 85.7 16.6 25.7 7.8 43.4 24.7 3.6

0.33% -3.17% 0.77% -3.42% -3.45% -1.64% -7.35% 6.15% -3.33% -0.97% -3.33% -0.84% -4.76% -0.99% -0.50% -14.29% -3.33% -3.13% 0.00% 1.39% 2.04% 5.04% 3.82% 0.35% 3.23% -0.54% -2.61% 0.47% -0.60% 0.78% 2.56% 0.69% 2.02% 5.56%

Thousands Thousands Thousands Thousands Thousands

December December December December December

360.33 202.39 46.88 38.32 37.14

359.93 200.83 46.67 38.40 37.69

358.67 201.56 46.51 38.36 37.14

0.46% 0.41% 0.80% -0.10% 0.00%

www.akbizmag.com • Alaska Business Monthly • April 2011


Sponsored

Indicator

Units

Unemployment Rate Alaska Anchorage & Mat-Su Fairbanks Southeast Gulf Coast United States

by

A m e r i ca n M a r i n e / P e n c o

Period

Latest Report Period

Previous Report Period (revised)

Year Ago Period

Year Over Year Change

Percent Percent Percent Percent Percent Percent

December December December December December December

8.1 7.1 7.1 8.6 10.8 9.1

7.8 7 6.9 7.9 9.9 9.3

8.8 7.6 8 9.4 12.1 9.7

-7.95% -6.58% -11.25% -8.51% -10.74% -6.19%

Millions of Barrels Billions of Cubic Ft. $ per Barrel

December December December

18.97 12.79 89.75

18.19 11.66 83.93

20.30 13.00 75.12

-6.55% -1.68% 19.48%

Active Rigs Active Rigs $ Per Troy Oz. $ Per Troy Oz. Per Pound

December December December December December

7 1711 1,392.03 2934.90 1.14

7 1683 1,370.84 2654.09 1.14

8 1172 1,134.87 1767.29 NO DATA

-12.50% 45.99% 22.66% 66.07%

Millions of $ Millions of $ Millions of $

December December December

15.80 3.56 12.25

12.80 2.94 9.86

21.62 5.25 16.37

-26.90% -32.26% -25.18%

Total Deeds Total Deeds

December December

1149 No Data

1270 No Data

783 180

46.74%

VISITOR INDUSTRY Total Air Passenger Traffic – Anchorage Total Air Passenger Traffic – Fairbanks

Thousands Thousands

December December

368.74 74.58

338.47 64.84

358.55 70.38

2.84% 5.97%

ALASKA PERMANENT FUND Equity Assets Net Income Net Income – Year to Date Marketable Debt Securities Real Estate Investments Preferred and Common Stock

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

December December December December December December December

38,425.10 38,768.60 176.9 $1,347.1 -61.3 13.4 1,221.8

37,002.60 37,405.40 117.8 ($353.5) -142.8 20.5 (299.2)

34,617.90 34,706.00 106.6 $515.5 (130.8) 7.5 473.7

11.00% 11.71% 65.95% 161.32% 53.13% 78.67% 157.93%

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 $

3rd Q10 3rd Q10 3rd Q10 3rd Q10 3rd Q10 3rd Q10 3rd Q10 3rd Q10 3rd Q10

2,068.99 37.35 131.40 1,110.96 15.76 1,823.80 1,785.53 479.89 1,305.64

2,068.99 37.35 131.40 1,110.96 15.76 1,823.80 1,785.53 479.89 1,305.64

1,964.14 41.17 116.19 1,167.14 11.78 1,734.68 1,702.13 447.46 1,254.67

5.34% -9.28% 13.09% -4.81% 33.70% 5.14% 4.90% 7.25% 4.06%

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

December December December December December

83.37 1.01 0.64 0.76 6.65

82.45 1.01 0.63 0.73 6.65

89.78 1.06 0.62 0.68 6.83

-7.14% -4.43% 4.01% 10.48% -2.57%

PETROLEUM/MINING Crude Oil Production – Alaska Natural Gas Field Production – Alaska ANS West Cost Average Spot Price Hughes Rig Count Alaska United States Gold Prices Silver Prices Zinc Prices REAL ESTATE Anchorage Building Permit Valuations Total Residential Commercial Deeds of Trust Recorded Anchorage – Recording District Fairbanks – Recording District

Data compiled by University of Alaska Center for Economic Development.

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Advertisers Index Ahtna Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79 Alaska Airlines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 Alaska Aviation Heritage Museum . . . . . . . . . . . . . . . . . . 150 Alaska Bone & Joint Institute . . . . . . . . . . . . . . . . . . . . . . . 86 Alaska Communications . . . . . . . . . . . . . . . . . . . . . . . 46, 47 Anchorage Convention & Visitors Bureau . . . . . . . . . . . . 117 Alaska Executive Search Inc. . . . . . . . . . . . . . . . . . . . . . . 29 Alaska Housing Finance Corp. . . . . . . . . . . . . . . . . . . . . 135 Alaska Media Directory . . . . . . . . . . . . . . . . . . . . . . . . . . 147 Alaska Public Telecommunications . . . . . . . . . . . . . . . . . . 90 Alaska Regional Hospital . . . . . . . . . . . . . . . . . . . . . . 67, 107 Alaska State Chamber of Commerce . . . . . . . . . . . . . . . . 72 Alaska Traffic Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37 Alaska USA Federal Credit Union . . . . . . . . . . . . . . . . . . . 99 Altius Consulting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 147 Alutiiq Oilfield Solutions LLC . . . . . . . . . . . . . . . . . . 106, 123 Ameresco . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 139 American Fast Freight . . . . . . . . . . . . . . . . . . . . . . . . . . . 106 American Marine/PENCO . . . . . . . . . . . . . . . . . . . . . . . . 151 Amerigas Propane . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 147 Anchorage Chrysler Dodge . . . . . . . . . . . . . . . . . . . . . . . . 94 Anchorage Opera . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 150 Arctic Controls . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 126 Arctic Fox Steel Buildings . . . . . . . . . . . . . . . . . . . . . . . . 126 Arctic Office Products (Machines) . . . . . . . . . . . . . . . . . . 113 ASRC Energy Services . . . . . . . . . . . . . . . . . . . . . . . . . . 131 AT&T Alaska . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 Azimuth Adventure Photography . . . . . . . . . . . . . . . . . . . 140 B2 Network . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69 Bartlett Regional Hospital . . . . . . . . . . . . . . . . . . . . . . . . . 62 Bering Straits Native Corp. . . . . . . . . . . . . . . . . . . . . . . . . 91 Bethel Native Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 111 Bowhead Transport Co . . . . . . . . . . . . . . . . . . . . . . . . . . . 53 Bristol Bay Native Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . 93 Calista Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95 Cape Fox Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50 CareNet Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61 Carlile Transportation Systems . . . . . . . . . . . . . . . . . . . . . 17 CCI Industrial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 129

154

Chenega Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87 Chris Arend Photography . . . . . . . . . . . . . . . . . . . . . . . . 154 Cloud49 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71 ConocoPhillips . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 Construction Machinery Industrial LLC . . . . . . . . . . . . . . 155 Corporate Council on the Environment . . . . . . . . . . . . . . 109 Credit Union 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58 Crowley . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45 Cruz Construction Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . 122 Davis Constructors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81 Delta Western . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Design Alaska . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59 Dowland-Bach Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 121 Dynamic Properties - Matthew Fink . . . . . . . . . . . . . . . . . . 43 EDC Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 111 Eklutna Native Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . 82, 83 Engineered Fire & Safety . . . . . . . . . . . . . . . . . . . . . . . . .126 ERA Aviation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105 ERA Helicopters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 136 Fairbanks Convention & Visitors Bureau . . . . . . . . . . . . . . 57 Fairbanks Memorial Hospital . . . . . . . . . . . . . . . . . . . . . . . 63 First National Bank Alaska . . . . . . . . . . . . . . . . . . . . . . . . . 5 GCI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75 Golden Valley Electric Association . . . . . . . . . . . . . . . . . 135 Great Originals Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58 Green Star Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 147 Horizon Lines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88 Hotel Captain Cook . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66 Hydraulic Repair and Design . . . . . . . . . . . . . . . . . . . . . . 113 Judy Patrick Photography . . . . . . . . . . . . . . . . . . . . . . . . . 59 Junior Achievement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55 Kakivik Asset Management LLC . . . . . . . . . . . . . . . . . . . 127 Kendall Ford Wasilla . . . . . . . . . . . . . . . . . . . . . . . . . . . 101 Kinross Fort Knox . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73 Landye Bennett Blumstein LLP . . . . . . . . . . . . . . . . . . . . 114 Lynden Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 137 Material Flow . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43 Microcom . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 115 Millennium Hotel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 149

MTA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 NALCO Energy Services . . . . . . . . . . . . . . . . . . . . . . . . . 126 NANA Regional Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89 New York Life . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Northern Air Cargo . . . . . . . . . . . . . . . . . . . . . . . . . . . 24, 25 Northrim Bank . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34 Northwest Ironworkers Employers Association . . . . . . . . 107 Nu Solutions Consulting . . . . . . . . . . . . . . . . . . . . . . . . . . 71 Olgoonik Development Corp. . . . . . . . . . . . . . . . . . . . . . . . 97 Pacific Alaska Freightways . . . . . . . . . . . . . . . . . . . . . . . . 96 Pacific Pile & Marine . . . . . . . . . . . . . . . . . . . . . . . . . 8, 9, 10 Parker, Smith & Feek . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 Peak Oilfield Services . . . . . . . . . . . . . . . . . . . . . . . . . . . 123 Pen Air . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110 People Mover/Share-a-Ride . . . . . . . . . . . . . . . . . . . . . . 150 Pippel Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 Princess Tours . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 114 Pyramid Printing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Rosie’s Delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 147 Ryan Air . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98 Seekins Ford Lincoln Mercury Fleet . . . . . . . . . . . . . . . . 130 Span Alaska Consolidators . . . . . . . . . . . . . . . . . . . . . . . 125 Spenard Builders Supply . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Stellar Designs Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 146 STG Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 141 Sullivan’s of Alaska Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . 149 Sundog Media . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 147 Superstar Pastry & Design . . . . . . . . . . . . . . . . . . . . . . . 146 The Superior Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110 The Growth Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62 Tobacco Prevention Control . . . . . . . . . . . . . . . . . . . . . . . . . 2 Totem Ocean Trailer Express . . . . . . . . . . . . . . . . . . . . . . . 33 Udelhoven Oilfield Systems Service . . . . . . . . . . . . . . . . . 85 Ukpeagvik Inupiat Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . .77 University of Alaska Anchorage/School of Engineering . . .41 Washington Crane & Hoist . . . . . . . . . . . . . . . . . . . . . . . . 49 Waste Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51 Wells Fargo . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 156 XTO Energy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

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April 2011 - Alaska Business Monthly