February 2011 Alaska Business Monthly

Construction and Environmental Issues | Oil and Gas Lease Sales

February 2011

$3.95

Bio Metrics

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E M P L O Y E E

B E N E F I T S

FEBRUARY 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 Events Calendar . . . . . . . . . . . . . 17 Market Squares . . . . . . . . . . . . . 19 Right Moves . . . . . . . . . . . . . . . . 58 Alaska Trends . . . . . . . . . . . . . 111 Ad Index . . . . . . . . . . . . . . . . . . 114 R E G U L A R F E AT U R E S

About the Cover

Biometrics is the science and technology of measuring and analyzing biological data.

Article on page 24

ARTICLES

OP-ED View from the Top Cort Christie, CEO ��������������������������������������������������������� 11 Hiring Military Veterans is Good Business . . . . . . . 20 Unemployment rate high for these individuals

By Bill Whitmore

Alaska Northern Lights

By Peg Stomierowski

Regional Review

Education Southeast ����������������������������������������������������������������������� 12 AKSourceLink: Networking For Alaskans . . . . . . . . 22 Help for Alaskans in business start-up

By Mary Edmunds

The Alaska Panhandle

By Tracy Barbour

Alaska This Month

Technology Top Chefs Dish Up Specialties ������������������������������������� 16 Biometrics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Wine and Food Festival benefits Cancer Society

By Nancy Pounds

Making it easier to tell if people are who they say they are

By Tracy Barbour

Towns in Transition

Mining Newtok is Drowning ����������������������������������������������������� 28 Alaska Mining Ramps Up for 2011 . . . . . . . . . . . . . . 60 Move or be washed away only options for community

By Heidi Bohi

Towns in Transition

Girdwood ����������������������������������������������������������������������� 32

Access, power and pay dirt influence success

By Dimitra Lavrakas Photo courtesy of Fire River Gold Corp.

Paradise with worldwide lure

By Heidi Bohi

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HR Matters Photo by Azimuth Adventure Photography/www.azimuthadventure.com

Protecting Your Company ��������������������������������������������� 34 Noncompete and other agreements help secure assets

By Lynne Curry

Legal Speak

Confidentiality Agreements ����������������������������������������� 35 Keeping business secrets in-house

By Jeff Waller

Associations

Associated General Contractors of Alaska Representing the Industry

Helping contractors have a voice . . 36

By Tracy Barbour

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General The Fine Art of Goal-Setting . . . . . . . . . . . . . . . . . . . 92 Setting written goals gives organizations an advantage

By Jim Romeo

Health & Medicine Providence Residency Program: Training Doctors . . . . . . . . . . . . . . . . . . . . . . . . . . 95 Patients get inexpensive but professional care

By Tracy Kalytiak (continued on page 6)

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

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

Health & Medicine Alaskans Have Many Orthopedic Options ����������������99

SPECIAL SECTION: ENGINEERING

Most stay in Alaska for health care

By Vanessa Orr

60th Anniversary of National Engineer Week . . . . . . . . 67

Oil & Gas Eni at Nikaitchuq ��������������������������������������������������� 102

2010 Engineer of the Year . . . . . . . . . . . . . . . . . . . . . . 68 Last year, Tom Krzewinski took top honors Compiled by Tom Krzewinski, P.E.

Offshore oil field work continues

By Mike Bradner

From Alaska to NASA . . . . . . . . . . . . . . . . . . . . . . . . . . 72 Devin Hahne puts engineering education to work Interview by David Hitt

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UAF Graduate Engineer at NASA . . . . . . . . . . . . . . . . . 73 Sky is limit for Tess Casswell

By Nicole A. Bonham Colby On the Front Lines: Engineers Critical to Alaska’s Development . . . . . . . . . . . . . . . . . . . . . 74 Huge potentials for local graduates

By Vanessa Orr

Photo by Judy Patrick Photography

Oil & Gas Crowley Moves Doyon Rig 25 ���������������������������������� 105 Spotlight on North Slope Photos by Judy Patrick

Alaska Universities Engineer the Economy . . . . . . . . . 77 Statewide entrepeneurship programs foster change

By Heidi Bohi Will We Be Ready? . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81 Training Alaskans for Gas Pipeline Jobs

By Vanessa Orr ABM’s 2011 Architects & Engineers Directory . . . . . . . 85

Oil & Gas ABCs of State Lease Sales ������������������������������������� 106 From promise to fruition

By Mike Bradner

Photo courtesy of Alaska Department of Labor and Workforce Development (ADLWD)

SPECIAL SECTION: BUILDING ALASKA Strangling Regs ������������������������������������������������������40

Keeping construction projects at bay

By John MacKinnon

Alaska Construction Forecast ��������������������������������46 Above average and better than Lower 48

By Nicole A. Bonham Colby

SENCO Alaska ��������������������������������������������������������50 Solution-based fastener company

By Gail West

Contract Surety Bonds: Vital to Alaska’s Construction Industry ����������������������������52 Making sure project owners are safe

By Tracy Barbour

Mack Trucks Inc. Comes to Alaska ��������������������������56 CMI expands full-service dealership

By Kent L. Colby

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

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EDITORIAL STAFF Managing Editor

Associate Editor

Art Director

Art Production

Graphic Design

Photo Consultant

Contributing

Photographers

Debbie Cutler Susan Harrington Candy Johnson Linda Shogren Janyce Nolan Goe Graphics & Design 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

Alaska:

Volume 27, Number 2 Published by Alaska Business Publishing Co. Anchorage, Alaska Vern C. McCorkle, Publisher 1991~2009

om

Where The Heart Is

Debbie Cutler

I

actually thought about leaving Alaska – for a nanosecond.

My two daughters are grown and gone and living in the Lower 48 with their families. I miss them, and don’t get to see them near enough. My parents and brother also live south, and visits come once a year or less.

I’ve lived in Alaska since 1986 and have since called this home. Home is not Phoenix where I grew up, where I still have friends, where I spent my entire youth.

Home is here, even in the depth of winter. I love Alaska.

I remember the first time I saw this state. I crossed the Canadian border into this Great Land and had to stop my vehicle as a herd of caribou scattered around the car, reminding me of the parting of the Red Sea. I was in awe and turned to my husband of the time and said, “I’m never leaving.”

I remember my first glimpse of Matanuska Glacier. I remember my first view of Anchorage.

I have great memories of my kids growing up on the same street I live now, starting kindergarten, graduating, going on to college. Alaska is a place they still call home, even though they have been gone for many years and have their own lives in Missouri and Georgia.

Alaska’s a Good Place to Live Alaska has been good to me. Here, as the rest of the U.S. is still in the throes of a recession, we are doing well as a state, and I am doing well as an individual.

Here, as magazines nationwide stumble to survive, ABM is still profitable and read by 100,000 monthly.

Alaska offers beauty, a stable housing market, a sound financial industry – and opportunity for growth, if we allow it.

People leave, they come back. They leave, they come back. It’s a haunting place. Once it’s in your blood, it’s hard to forget, hard to imagine a life without long winters and amazing, but short, summers, with endless adventures and places to travel. I love seeing Alaska – everything from Bush communities, to my annual summer treks to Homer, from Glacier Bay to Juneau, from Kodiak to Seward, from Kotzebue to Gambell. It’s an awesome awesome place.

I got a call the other day from an old roommate. He said he is returning to Alaska after three years gone. This place is in his blood as thick as it is mine.

Great Place to Grow Old I miss my family. I miss them terribly. But I think I will grow old here. I arrived as a young adult and now in my midlife can’t think of leaving, not when I really think about it. I will grow old and gray and feeble living in this state, and if I live to 80, will still be amazed that every twist and turn along our road system is like living in a postcard. Every place (just about) picture-perfect.

A coworker told me the other day stay in Alaska, but take more trips Outside for visits. I think I will take her advice. Alaska is home, and home is where your heart is. Alaska stole mine 25 years ago this month. Ahhh. What a good thing to happen.

– Debbie Cutler Managing Editor

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

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Inside Alaska Business

R

R&M Consultants Listed as Top Employer

&M Consultants Inc. was ranked No. 16 in an industry magazine listing of top civil engineering employers.

CE News chose the Alaska firm for its 2010 Best Civil Engineering Firms to Work For list.

“R&M is extremely honored by this ranking and our second consecutive year of being named one of the best civil engineering firms to work for in the nation,” said Len Story, R&M’s chief operating officer. “The single most important and distinguishing asset of our firm is our people, and realizing this, the management team at R&M is continually seeking ways to show our commitment to our people.”

R&M has offices in Anchorage and Fairbanks.

Design Firm Garners Awards

M

ad Dog Graphx received several industry accolades for its efforts.

The Anchorage firm garnered six honors at the 16th annual Annual Communicator Awards. Mad Dog Graphx won gold honors for two annual reports created for Food Bank of Alaska and The Alaska Community Foundation, for a promotional piece designed for Alaska Stock Images, and for a letterhead package for ACF. A logo for the Alaska Primary Care Association won a silver award, and the Alaska Stock Images piece also earned silver in the direct-mail category.

Mad Dog won four honors from the 2010 Davey Awards, an international competition recognizing outstanding

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graphic design from small firms. Davey Awards honored the firm’s work on logo designs for Vitus Marine, a marine-fueling company serving Western Alaska; Core Pilates, a new Anchorage fitness studio; and Alaskan Built, a program recognizing local talent in construction. The firm was also recognized for work on an ACF annual report.

SBA Chooses Wells Fargo as Lender of the Year

T

he U.S. Small Business Administration Alaska District Office chose Wells Fargo Bank as the 2010 Lender of the Year. The award recognizes the SBA lender that achieves the overall highest number of SBA loan approvals to businesses located in Alaska during the federal fiscal year, ending Sept. 30. Wells Fargo tallied 34 SBA loan approvals totaling more than $7.5 million.

“Wells Fargo Bank and our other SBA lending partners play vital roles in financing new Alaska small businesses, and facilitating the expansion of existing businesses,” said Karen Forsland, Alaska SBA district director. “We are proud to recognize Wells Fargo Bank for its success in using SBA’s loan-guaranty programs to provide our small business community with access to capital.”

Other awards were presented at the Alaska Lenders’ Symposium in Anchorage in November. Alaska Pacific Bank was chosen Community Lender of the Year. Alaska Growth Capital was honored as Low- to Moderate-Income Lender of the Year. Alaska USA Federal

Compiled By Nancy Pounds Credit Union was recognized as SBA’s top 504 Lender of the Year. Alaska USA Business and Commercial Services has won the award for two consecutive years.

Donlin Creek Inks Iditarod Sponsorship

D

onlin Creek LLC signed up as a new sponsor of the 2011 Iditarod Trail Sled Dog Race, which begins March 5 with a ceremonial start in Anchorage. The company is contributing $285,000 to support the event.

Donlin Creek, owned by Barrick Gold and NovaGold, proposes to develop a gold deposit in the Yukon-Kuskokwim region, near the townsite of Iditarod.

The deposit is situated on Alaska Native lands owned by The Kuskokwim Corp., which owns surface land, and Calista Corp., which owns subsurface materials.

Tour Company Receives Safety Award

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olland America/Princess - Alaska Land Operation received Lancer Insurance Co.’s Safety Excellence Award for 2009. Holland America/ Princess or Royal Hyway Tours Inc. has operations in Anchorage, Fairbanks, Juneau, Ketchikan, Skagway and Denali National Park and Preserve. Lancer Insurance, based in Long Beach, N.Y., is a top provider of insurance, risk management and loss-control services to the American passenger transportation industry.

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

Inside Alaska Business Law Firm Expands Services

T

he law firm of Holmes Weddle & Barcott’s offices in Anchorage and Seattle will now provide services throughout the West Coast. Employees at these offices represent various employers and insurers, maritime and construction interests to handle workers’ compensation, commercial and personal injury litigation and federal government relations. Holmes Weddle & Barcott opened offices in San Diego in November. The firm also merged with the Portland law firm of Babcock and Haynes to operate an office in Oregon.

AEA Conducts Meetings on Susitna River Hydro Project

only provide cost-effective, reliable, long-term power, it must help the state meet its goal of producing 50 percent of our power from renewable resources by 2025. We believe the Susitna Project does all this.”

Reports were produced by HDR Alaska Inc., R&M Consultants/Hatch Acres and Seattle-Northwest Securities Corp. Studies show the Susitna Project would produce up to three times more energy at a lower cost per unit with less likely environmental effects and fewer potential licensing and permitting issues. The Chakachamna project would require underground work, present building challenges from steep terrain and may have a greater risk of environmental impact.

NANA Supports Elders With Payment

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he Alaska Energy Authority plans to conduct public workshops in February on the Railbelt Large Hydroelectric Project. Information on the project is available on the AEA Web site, www.akenergyauthority.org. Comments can be e-mailed to largehydro @aidea.org. In late 2010, the AEA recommended the Low Watana site on the Susitna River as the proposed primary hydroelectric project. The Chakachamna Project was listed as an alternative project. Also in 2010, the Alaska Legislature provided funding for AEA for the preliminary planning, design, permitting and field work for the Susitna and Chakachamna Projects.

“Our goal has been to identify the project that has the best chance of being built,” said Mike Harper, AEA acting executive director. “A large hydroelectric project for the Railbelt should not

T

he NANA Elders Settlement Trust plans to pay $2,000 per elder this month. The trustees approved the 2011 payout last year. The trust was established by NANA Regional Corp. Inc. in 2008 to provide a modest, yet needed, special distribution to NANA shareholders who are 65 or older. This distribution is the result of a contribution from NANA. The distribution is $1,500, with an additional $500 for taxes.

“Many of our elders live on a fixed income, and it is our hope this dividend will help them and make their lives a little easier next year,” said Donald G. Sheldon, NANA board chairman when the dividend was announced in December 2010. “The NANA Elders’ Settlement Trust is just one way we

honor those who have paved the way for other NANA shareholders.”

Support Buoys Crab Research

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iologists in Juneau working to raise hatchery king crab landed $460,000 in federal funds and Alaska industry support. Researchers at the Alaska King Crab Research, Rehabilitation and Biology program will use the funds to study how juvenile king crab cope with predators, find food and interact with other marine organisms, including other crab. Their work could eventually help rebuild collapsed king crab stocks in parts of Alaska. The group consists of university and federal scientists, fishermen, seafood businesses, coastal communities and Alaska Native groups. These parties united in 2006 to find ways to help Kodiak Island red king crab and blue king crab in the Pribilof Islands recover. AKCRRAB scientists working at the Alutiiq Pride Shellfish Hatchery in Seward have steadily improved red king crab larval survival in the hatchery. Ginny Eckert, associate professor of fisheries at the University of Alaska Fairbanks School of Fisheries and Ocean Sciences, and Allan Stoner, research fisheries biologist with the federal Alaska Fisheries Science Center in Newport, Ore., received a two-year, $303,000 grant from the National Oceanic and Atmospheric Administration SeaGrant Aquaculture Research Program. Additional in-kind and support services totaling nearly $157,000 comes from the Alutiiq Pride Shellfish Hatchery, the Alaska Department of Fish and Game, UAF and Alaska Sea Grant.

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

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Inside Alaska Business

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Anchorage Museum Earns Honor

he Anchorage Museum received accreditation from the American Association of Museums. The honor is the highest national recognition for a museum.

“AAM accreditation places the Anchorage Museum among the top 5 percent of museums in our nation,” said James Pepper Henry, Anchorage Museum Director and chief executive.

“It provides the credentials necessary for our institution to host some of the most exciting exhibits and programs the world has to offer.”

Of the nation’s estimated 17,500 museums, 775 are currently accredited.

The Anchorage Museum was first accredited in 1979.

Surgery Center Opens in Fairbanks

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he Surgery Center of Fairbanks opened in mid-November. Dr. Mark Wade, an orthopedic surgeon, is one of the center’s physician owners. The center features two operating rooms with integrated video endoscopy equipment and high-definition, largescreen monitors on extending arms that surgeons can pull near the operating table to view patient X-rays, rather than walking to wall-mounted screens.

The center also has six pre-operative rooms and 16 recovery bays. The building includes 15,000 square feet of medical office space, which is due to be completed in early 2011.

“This new facility already has

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made a positive economic impact on our community both in terms of construction dollars spent and now the employment of 16 full- and part-time staff members living here in Fairbanks,” Dr. Wade said.

Alaska companies participating in the project included commercial real estate developer Pfeffer Development, contractor Criterion General Inc. and kpb architects.

The next big step for the Surgery Center will be a review by the Joint Commission on Accreditation of Health Organization, according to center administrator Russ Uhrmacher.

Approval from the group is required to serve Medicare and Medicaid patients.

Rasmuson Foundations Awards Grants

T

he Rasmuson Foundation board of directors approved more than $5 million to fund 12 statewide organizations. The board also voted to extend support of two programs managed by the foundation.

The City of Seward received $500,000 to build a multi-use facility that will house both the library and the Seward Museum. Alaska Addiction Rehabilitation Services, known as Nugen’s Ranch, in Wasilla, received $500,000 to build an adult residential substance-abuse treatment facility at Point MacKenzie. Anchorage Neighborhood Health Center gained $500,000 to build a new community health center, which will nearly triple patient capacity. Wrangell Medical

Center received $500,000 to build a new hospital and nursing home.

The Matanuska-Susitna Borough received $191,920 to build a new library and community resource center in Sutton. Perseverance Theater in Juneau was awarded $250,000 to fund development of a four-event, annual season in Anchorage. Museum of the Aleutians received $100,000 to fabricate and install a permanent exhibit titled “The Aleutian Islands: Crossroads of the North Pacific.” Salvation Army–Alaska Division in Anchorage gained $100,000 to build a community and recreational facility adjacent to its Salvation Army Family Enrichment Center.

The Southeast Alaska State Fair in Haines received $66,692 to support renovations to Harriet Hall, improving the facility’s ability to serve as a community events center.

Kenai Watershed Forum received $50,000 to restore and renovate the historic Alaska Road Commission building, a 1950s structure that will become the organization’s headquarters. The Foraker Group in Anchorage received two three-year grants: $1.5 million to support their work building the capacity of Alaska’s nonprofit sector; and $900,000 to continue the PreDevelopment program that provides technical assistance to nonprofits in the early stages of capital projects.

The Rasmuson Foundation board also allocated $610,000 to continue the Sabbatical Program for three years, and $500,000 for five years’ additional support for the costs associated with continued development of the Permanent Fund Dividend Charitable Contributions Program, called Pick. Click. Give. q

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

View

from the

Top

Compiled By Peg Stomierowski

Cort Christie, CEO

Alaska Northern Lights

A

laska Northern Lights, with 10 employees in Reno, Nev., has sold more than 30,000 light boxes since the early 1990s, when Neil Wagner started the enterprise in Homer. Cort Christie took over when Wagner retired after 17 years. Hailing from Duluth, Minn., both men had experienced the effects of scant winter sunshine. They’d also worked together in the fishing industry in Alaska. Christie, who has a Bachelor of Arts in Finance and an MBA, also founded Nevada Corporate Headquarters, a business formation and consulting firm in Las Vegas. He enjoys skiing, motorcycling, mountain biking and hiking, and says he’s always been interested in alternative health solutions.

A BRIGHTER VIEW “Brighter is better” has always been our motto. We build a highly effective light box to treat seasonal affective disorder (SAD), sleep disorder and other mood disorders. We’ve been producing a product of the same high quality since 1992 and found we tend to not have warranty and assembly issues. Our return rate is less than 2 percent, which is why we offer a 60-day, money-back guarantee and a lifetime warranty. We want to ensure every customer is satisfied.

INSPIRED BY NATURE The firm was named after aurora borealis, known as the northern lights. Wagner’s wife, who had debilitating health problems, had found that light therapy relieved many symptoms.

Ultimately Wagner found the firm Testrite, in New Jersey, to custom manufacture the boxes to his specifications. He designed and manufactured the original box still being sold today.

A user takes a position close to the box, which is available in tabletop or floor-stand models.

HEALTH EFFECTS In a now classic research paper by Norman Rosenthal and colleagues, a clinical study attempted to explore the relationship between light and mood. It was concluded most patients who received brighter light (with a frequency spectrum that simulated the frequency in sunlight) had a change in mood. Since then, evidence has grown that bright-light therapy helps treat the symptoms of SAD. Most people see their energy level increases. They start waking without an alarm clock and getting up becomes easier. Some feel lighter and happier overall.

SALES STRATEGIES Our theory is that a brighter box is better. The North Star 10,000 box affords high-intensity light from a distance of about two feet for about 30 minutes. That’s enough time to eat breakfast or do some morning tasks. Our light box is built in the USA. About 80 percent of our sales are online. Customers can order through our website. Our products also are available on Amazon, EBay and TrueSun.com.

CYBER THRUST We are an online retailer of light boxes. We do not compete with other local outlets that offer products in stores. Still, many of these products are smaller and less durable and don’t come with the warranty and trial period we have in place. We also run many specials on our website, including free shipping.

Photo courtesy of Alaska Northern Lights

OPERATIONS More insurance companies are reimbursing clients for the purchase of light boxes for treatment of SAD, sleep and mood disorders. We have insurance forms that list the correct DSMIV-R (diagnostic manual) code and other data for doctors to complete. After you have purchased your light box, you can submit your receipt, completed insurance form and doctor’s prescription q for reimbursement. www.akbizmag.com • Alaska Business Monthly • February 2011

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REGIONAL REVIEW

Southeast

The Alaska Panhandle

S

outheast Alaska, also known as the Alaska Panhandle, is a mountainous stretch of land between British Columbia and the Pacific Ocean.

With about 69,300 residents, the region is an archipelago – a group of islands with breathtaking mountains, glaciers and waterfalls. It includes Alaska’s renowned Inside Passage, Glacier Bay National Park and much of the Tongass National Forest, the largest national forest in the United States.

With its expansive terrain, Southeastern Alaska has an abundance of flora and fauna. The Tongass National Forest, for example, is filled with fertile evergreen Sitka Spruce, Western Hemlock, Red Cedar and Lodgepole Pine, as well as deciduous Red Alder and Black Cottonwood. Wildlife in the region includes deer, brown and black bear, mountain goats, wolves and moose in some parts. The area’s marine environment is replete with everything from halibut, salmon and cod to humpback whales, orcas, sea lions and seals. Bald eagles, puffins and other sea birds also add interest to the natural surroundings.

Juneau at a Glance

Population: 30,700 Location: Approximately 900 air miles north of Seattle and 600 air miles southeast of Anchorage Key Local Contacts: Juneau Mayor Bruce Botelho and Chris McNeil, president and CEO of Sealaska Corp.

Government Structure: The City and Borough of Juneau is a home-rule municipality with a nine-member assembly and the mayor as presiding officer Main Industries: Government, tourism, fishing, health care, education, construction and mining Schools: University Alaska Southeast Hospitals: Bartlett Regional Hospital and Southeast Alaska Regional Health Consortium Airport: Juneau International Airport Port: Port of Juneau

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Occupying about 35,000 square miles, Southeast Alaska encompasses 10 boroughs and census areas. Prominent cities in the region are Juneau, Ketchikan, Sitka, Haines, Wrangell, Petersburg and Skagway. Smaller communities include Yakutat, Gustavus, Pelican, Tenakee Springs, Port Alexander and Hyder. Because there are few roads throughout the region, the primary mode of transportation between the communities is by boat, floatplane or ferry. In addition, Alaska Airlines provides commercial jet service to various locations in Southeast.

The climate in Southeast is notoriously rainy, with some areas receiving more than 150 inches per year. The ample rainfall contributes to the massive size of the coastal Sitka Spruce and Western Hemlock. Warm weather fronts ushered in from the Pacific Ocean create a relatively mild climate in the region. However, the northern section of the Southeast receives a great deal of snow. Haines, for example, typically has three to four feet of snow blanketing the ground during winter. Juneau, on the other hand, has a mild, maritime climate, with an average annual temperature of 55 degrees Fahrenheit.

Rich Culture and History

Like many places in the state, Southeast has a rich culture and history. First inhabited by Tlingit, it is now home to a variety of Alaska Native tribes, including Haida and Tsimshian. Explorers Aleksei Chirikov, a Russian, and Vitus Bering, a Dane, arrived in northern Southeast Alaska in 1741.

In 1799, Russian explorer Alexander Baranov landed in Sitka, establishing it as a European settlement. Resentful Tlingit attacked the settlement in 1802 and, again, several years later. Despite opposition, Russian colonists created a thriving trading operation for seal fur and other goods.

Photo courtesy of Juneau Convention and Visitors Bureau

By Tracy Barbour

Mount Roberts Tramway takes riders for a breathtaking aerial view of Juneau and the surrounding area.

In 1867, Alaska was purchased from Russia in a historic ceremony at Sitka, which was the state’s capital then. In 1880, gold was discovered, bringing unprecedented attention to the Panhandle.

Miners Joe Juneau and Richard Harris uncovered a large amount of gold in Silverbow Basin, near what is now Juneau.

The area quickly gave birth to some of the largest mines in the state. In 1900, the territory’s capital was relocated to Juneau, where it remains today.

Southeast Economy

Natural resources are an intrinsic part of the economy of Southeast Alaska, with mining, fishing and logging, being important drivers. Local government forms a big piece of the economic pie in Southeast Alaska, as in other parts

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

of Alaska. Tourism, health care, education, retail and construction are also important to the region’s economy.

Several economic trends are taking place in southeastern Alaska, said Mali Abrahamson, an economist with the Research and Analysis section of the Alaska Department of Labor.

“Southeast’s economy is stable in some sectors and uncertain and declining in others (such as the visitors industry and trade and services). We are seeing increases in our natural resources and mining,” she says.

Abrahamson points out that although fishing isn’t the primary economic driver in the Southeast, “fish harvesting” employment represents a significant boost to the region’s economy. Fish harvesting workers – like individuals who are self employed or in the military – aren’t entirely reflected in the Alaska Department of Labor’s employment numbers. In 2009, Southeast Alaska had an estimated harvesting work force of 10,150, she says. The estimated harvesting work force is based, in part, on calculations involving the number of fishing permit holders.

Besides providing employment, the fishing industry generates significant demand for general goods and services.

“You can’t ignore the fishing industry,” she says. “It brings earnings into these communities and supports all the nonbasic industries.”

Like many regions of Alaska, Southeast has strong seasonal patterns in its fishing employment. About 25 percent of Juneau’s labor force works in the fishing industry at its peak. The estimated harvesting work force is based, in part, on calculations involving the number of fishing permit holders.

Southeast Alaska also is experiencing noticeable shifts in population and demographics. The region’s overall population is declining, which is likely due to the geographic hurdle of living there, Abrahamson says.

Juneau, however, had a slight increase in population. “We’re getting a lot of movement from smaller communities,” she says, explaining a possible reason for the change.

As another trend, the region has an older population of workers. According to Abrahamson, the median age of workers in the Southeast region is

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more than 39 years old; statewide, it’s more than 33.5 years. She says, “People under 50 generally aren’t moving to or staying in Southeast Alaska.”

Abrahamson adds that Southeast Alaska is experiencing an increase in its health care, social services and education sectors. At the same time, preliminary numbers are showing decreased employment in retail and leisure and hospitality.

The Capital City

With a population of about 30,700, Juneau is Southeast Alaska’s largest

city and regional hub. Lorene Palmer, president and CEO of the Juneau Convention and Visitors Bureau, says Juneau is a “wonderful combination of wilderness and cosmopolitan amenities. As the capital of Alaska, Juneau’s political atmosphere blends with the downtown’s historic atmosphere and spectacular natural setting of a coastal community.”

Because of its position as the state’s capital, employment in Juneau’s economy is dominated by government jobs.

Federal, State and local government made up 41 percent of Juneau’s non-

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farm employment in 2009, according to Abrahamson. The 2009 statewide rate for government employment, in comparison, was around 25 percent.

Besides government, Juneau also has a large proportion of jobs stemming from general services, support industry, health care and education. And most of the city’s retail and trade industries get a seasonal boost from the leisure and hospitality industry, making it an important sector for the city. Juneau’s leisure and hospitality industry – which includes food services, accommodations, arts and recreation – generated about 1,500 employees in 2009, Abrahamson says. The total number of nonfarm employees for Juneau in 2009 was approximately 36,000.

While Juneau’s cruise ship passenger volume had seen decades of steady growth, fewer ships docked in the area in 2010. “Juneau’s cruise passenger arrivals for 2010 were reduced significantly due to the redeployment of three large vessels, which resulted in reduced sales tax revenues for the municipality,” Palmer says. “The independent traveler market – as measured by air arrivals, hotel occupancy and ferry arrivals – was essentially flat, and the same is expected for 2011.”

Palmer adds that Juneau will see three new cruise lines enter the market in 2011. “Disney, Chrystal and Oceania are each bringing a new ship to Alaska,” she says. “However, Holland America and Princess are removing two vessels, so the net increase in capacity is approximately 11,500 passengers.”

One of the most popular attractions for Juneau visitors is the Mendenhall Glacier. Sitting about 12 miles from downtown Juneau in Mendenhall Valley, the glacier stretches 12 miles from its origin on the Juneau Icefield to its terminus at Mendenhall Lake.

The Mount Roberts Tramway is another major magnet for tourists. Adventure seekers can ride the enclosed tramway from 27 feet to 2,000 feet through the rain forest up to Mount Roberts for an expansive view of the harbor, sea and mountains. Once on Mount Roberts, visitors can indulge in hiking trails, bear viewing, cultural events, souvenir shopping and other pursuits. They can also visit the nature

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

center, restaurant, bar and theater for entertainment. Other tourist attractions in the Juneau area are Alaska State Museum, Juneau-Douglas City Museum, Glacier Bay National Park and Preserve, the Alaska-Gastineau Mill and Gold Mine Tour and Glacier Gardens Rainforest Adventure.

Sealaska Corp.

Sealaska Corp. is the Alaska Native regional corporation for Southeast Alaska. Based in Juneau, it has more than 17,600 shareholders, primarily of Tlingit, Haida and Tsimshian descent.

Sealaska is the largest private landowner in the region with more than 290,000 acres of surface land and 560,000 acres of subsurface land in Southeast.

Sealaska has a variety of business ventures and investments that provide economic, cultural and social benefits for its current and future shareholders.

Its business activities include the harvesting and marketing of premium wood products to the Pacific Rim and Pacific Northwest. Timber harvesting, along with land and forest resource management, represent the majority of its economic enterprises.

Over the years, Sealaska has diversified its business operations to include plastics-injection molding, manufacturing, environmental consulting, construction and manufacturing aggregates, information technology, and machining and prototyping. Sealaska employs more than 1,000 individuals.

Fifty-two percent are shareholders and descendants employed in nonmanufacturing sectors.

The corporation’s wholly owned subsidiaries are Sealaska Timber Corp., Alaska Coastal Aggregates, Sealaska Environmental Services and Synergy Systems. Its other subsidiary businesses include the Nypro Kánaak joint ventures, Managed Business Solutions, Olympic Fabrication and Kingston Environmental Services. Recently, Nypro Kánaak garnered the Minority Manufacturer Firm of the Year from the U.S. Department of Commerce Minority Business Development Agency. The company has manufacturing facilities in Mexico, Iowa and Alabama. In 2009, Nypro Kánaak employed 450 workers and had revenues of $60 million, according to a press statement. q www.akbizmag.com • Alaska Business Monthly • February 2011

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FEB

6

Alaska This Month

By Nancy Pounds

Top Chefs Dish Up Specialties

Photos by Jamie Lang Photography

Wine and Food Festival benefits Cancer Society

Far left: Chef Al Levinsohn, owner of Kincaid Grill, participated in last year’s Anchorage Wine and Food Festival.

Center left: Cancer survivor Ariel Courtright of Anchorage worked as a leader-in-training at last year’s Camp Goodtimes in Washington.

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ometimes the best medicine is a whipped-cream fight.

Ariel Courtright of Anchorage believes these and other adventures at summer camp help treat the hearts of children affected by cancer.

“It’s absolutely disgusting, but absolutely the best thing ever,” said the 17-year-old Courtright, describing the dairyproduct battle.

Courtright was diagnosed with acute lymphoblastic leukemia in 1997 when she was a preschooler. She has attended Camp Goodtimes on Washington’s Vashon Island for nine years as a camper, and last year she served as a leader-intraining. The American Cancer Society’s Camp Goodtimes provides summer activities for child cancer survivors and patients undergoing treatment from Alaska and Washington.

“It’s a week filled with laughter, joy and memories,” Courtright said.

Children leave behind long hospital visits or painful treatments to take the ferry from Seattle to the camp. They are met with understanding amid youthful camp-style experiences.

“Everybody there is connected with cancer in some way,” she said.

Memories from camp sustain children powerfully, Courtright said. “It’s our own little fairy tale, and then we go back to reality and that’s a bummer.”

Last year, the American Cancer Society Alaska office sent 24 cancer survivors to the camp, “where they were able to run, play and just enjoy being a kid,” said Sarah Robinson, district executive director.

Eats for Cancer

The American Cancer Society raises funds at the Anchorage Wine and Food Festival for Alaskan children to attend Camp Goodtimes. The event largely raises funds to support cancer research, education and services for Alaska cancer patients and caregivers. Last year, the festival raised more than $250,000 to fund the American Cancer Society’s Alaska efforts, Robinson said.

This year’s Anchorage Wine and Food Festival is from 6:30 p.m. to midnight, Feb. 6, at the Hotel Captain Cook.

The event features a multi-course meal produced by top Alaska chefs and accompanied by carefully chosen wines.

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Top Alaska chefs set to participate this year include: Al Levinsohn of Kincaid Grill, James Sheperd of Simon and Seafort’s Saloon & Grill, Rob Kinneen of Orso, Patrick Hoogerhyde of Glacier Brewhouse and Van Hale of Marx Brothers Café. Other contributing food industry representatives will come from Crow’s Nest, Café del Mundo, Seven Glaciers Restaurant and the University of Alaska Anchorage Culinary Arts Program. Brown Jug Liquor Stores, K&L Distributors Inc., Odom Corp. and Specialty Imports Inc. The event unfolds as an Epicurean sensation. Last year’s entrée was smoked flat iron steak prepared by Crow’s Nest executive chef Tim Fynskov. The salad course was Marx Brothers Café’s Van Hale’s specialty, Caesar salad. Naomi Everett and Vern Wolfram, instructors from the UAA Culinary Arts Program, produced chocolate chip cream cheese cupcakes for dessert.

The Wine and Food Festival includes several ways to donate money to benefit Alaskans battling cancer. Anchorage businesses and individuals sponsor the dinner courses. A live auction features various items, including several selections of wine. The American Cancer Society also sells a Chefs of Anchorage calendar with recipes from participating chefs.

Bob Klein of Brown Jug organized the first Wine and Food Festival in 1985, with help from Anchorage American Cancer Society volunteers. Klein wanted to honor the memory of Joe Wiley, who was president of Oaken Keg and the state chairman of the American Cancer Society. The fundraiser was their contribution to help Alaskans fight cancer.

“The event started out as a smaller wine tasting and has grown to a sophisticated, black-tie affair,” Robinson said.

“Our volunteers assemble an outstanding array of wine, matched with the offerings of Anchorage’s most talented chefs, all in support of the American Cancer Society.”

Last year 375 people attended the event, she said.

Cancer is the leading cause of death in Alaska, according to Robinson. One in three Americans will be diagnosed with cancer in their lifetime, she said.

“Donations from this event allow us to continue to provide services and support to the more than 2,800 Alaskans who will be diagnosed with cancer this year,” Robinson said. q

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

F ebru ary E v e n t s C a l e n da r • • • • • • •

4 to 5

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n c h o r a g e • • • • • • •

Suzanne Vega

Widely regarded as one of the most brilliant songwriters of her generation, Suzanne Vega is a leading figure of the folk music revival of the early ‘80s. Come see her critically acclaimed debut album, she performs for sold-out halls. Friday at 7:30 p.m. to 12 a.m. at Alaska Center for the Performing Arts Atwood Concert Hall. Contact: 907-263-2787.

4 to 31

Sing-a-Long at the Zoo

Preschool-age kids can explore the world of animals through music with Annie Reeves. In addition to hearing her guitar talent, children can sing along and play along with her collection of musical instruments for kids. Programs are held at the Coffee Shop greenhouse at 10:30 a.m. Contact: 907-346-2133.

6 to 31

Bon Appetit!

Alaska Zoo Story Time

Preschool-age kids can explore the world of animals with their parents by listening to a zoo storyteller who will read books featuring animal species that live at the zoo, followed by a zoo animal encounter. Programs are held at the Coffee Shop greenhouse. 10:30 a.m.

Contact: 907-349-2133.

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Mrs. Alaska America Pageant

Come cheer on Alaska’s married women during the largest and first pageant for married women in the world. The 35th annual celebration of Mrs. Alaska-America will take place Feb. 12 at 7 p.m. in Anchorage at the Wendy Williamson Auditorium. The participants will be awarded more than $30,000 in prizes and awards. Contact: 907-632-7775.

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Bakery & Cafe

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Try our delightfully delectable, delicious sweets and treats - created by French Master Chefs, Antoine and Michel.

Breakfast • Lunch • Dinner • Dessert

Join us for a traditional six-course dinner from a different region in France the first Tuesday of each month!

Susitna 100 Race Across Alaska

Susitna 100 (mile) and Little Su 50K are foot, bike or ski races held on winter trails in the Susitna River valley, north of Anchorage. Online registration closes Feb. 13. Susitna 100 racers must attend the pre-race meeting Thursday, Feb 17, in Anchorage. Entries accepted at the pre-race meeting on Feb. 17. Little Su 50K limited to 125 racers. See the website for additional info: www.susitna100.com.

25 to 27

World Championship Sled Dog Races

Sled Dog Races are a Rondy Classic, which began in 1946 and continue today with what is known as “Rondy.” The Open World Championship Sled Dog Race, come see the grandfather of all Alaska races, begins at Fourth Avenue and D Street in Anchorage. Visit the website at www.furrondy.net or call 907-274-1177.

25 to March 6

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Anchorage Fur Rendezvous

A time-aged tradition that dates back to the early 1900’s when trappers and miners emerged from the Alaska wilderness to trade, socialize and compete in survival-type games.

Affectionately known as “Rondy,” wild and wacky activities, contests, performances and events include the snowshoe softball tournament, outhouse races, ice bowling, Running with the Reindeer, old-time melodrama, Alaska Native tribal gatherings, the Miners & Trappers Ball, fur auction and much more fun. Visit the website at www.furrondy.net or call 907-274-1177.

Our specialty is palate pleasing choices prepared for board meetings, breakfast, lunch and special occasions.

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

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F e b r uary E v e n t s C a l e n da r 26

Fur Rondy Grand Parade

Come kick off the Fur Rendezvous with a grand start. Fur Rondy Grand Parade on Fifth and Sixth avenues in Anchorage begins at 10:30 a.m. Visit the website at www.furrondy.net or call 907-274-1177.

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a i r b a n k s • • • • • • •

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Nanooks versus Bulldogs

University Alaska Fairbanks Nanooks versus Ferris State Bulldogs at the John A. Carlson Community Center, 7:05 p.m. is start time. Contact: 907-451-8528.

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Montgomery Gentry Concert

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SOLAS

One of country music’s greatest bands, not to be missed, is performing at the Carlson Center, 2010 Second Avenue in Fairbanks. Tickets range from $95 – $237. Contact: 907451-8528.

Since 1996, Solas has been proclaimed as the most popular folk band and has captured the hearts and ears of Irish music fans. With fans all around the globe, Solas is a blend of Celtic traditional, folk and country melodies, blues, sometimes jazz-inspired improvisations, and global rhythms. Hering Auditorium, 8 p.m. 901 Airport Way, Fairbanks. Contact: 907-474-8081.

22 to March 27

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You haven’t heard pop, disco or rock until you have heard The Spiff. Formed in summer 2009, The Spiff have been touring the Cleveland scene ever since and in 2010 they recorded their EP, “The Lovable ol’ James,” with their trademark sound of mixing alternative rock with hints from all genres with KISS being one of their major sound influences. Maxines Glacier City Bristo, Mile 3 Crow Creek Road, Girdwood, 8 p.m. Contact: 907-783-1234.

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Arts at Egan Series 2011

The winter edition of the Juneau Underground Motion Picture Society (JUMP) film festival comes to the University of Alaska Southeast. Come and enjoy an eclectic collection of short films by local filmmakers. Program begins at 7 p.m. in the Egan Lecture Hall on the UAS campus. Event is free and open to the public. Contact: 907-796-6249.

12 to 13

Wearable Art Extravaganza

The Juneau Arts & Humanities Council produced two funfilled events celebrating creativity and wearable works of

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Eaglecrest Winter Fireworks Spectacular

Eaglecrest celebrates winter with its Winter Fireworks Spectacular. Events begin in the day lodge at 4 p.m. Light Parade kicks off at 6 p.m., followed by the fireworks display.

This event is free and open to the public. Contact: 907-7902000.

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11 to 13

e w a r d • • • • • • •

‘A Weekend to Die For!’

Presented by OutCast! Productions LLC at the Seward Resort, its 2nd Annual Valentine’s Day Weekend Murder Mystery, “A Weekend to Die For!” is a romantic getaway filled with intrigue and murder. The Friday through Sunday event includes cocktails, a downtown breakfast and a romantic dinner while mingling with other guests and suspicious characters. Pay close attention to conversations and connections along the way. You wouldn’t want to miss a clue. This adventure will take you through downtown Seward to help solve the mystery that s been haunting you all weekend. Come and share the fun with your loved one. Great prizes to be won. Prices for the event start at $225 per person for three days. Seward Resort, 2305 Dimond Blvd., Seward. Contact: 1-800-7701858 or 907-224 -5559.

Board Game Night

Youth Events Board Game Night for ages 12-24 (or thereabouts). Bring a snack/drink/or favorite board game to share from 7 p.m. to 10 p.m. Free snacks/drinks. This is a casual event: Age range is for teens and cost is free. Kathy’s Kloset, 11724 Seward Hwy. (Mile 3.7) across from Spenard Builders Supply. Contact Jessica: 631-2189.

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a l k e e t n a • • • • • • •

i r d w o o d • • • • • • • 20 Karen Savoca & Peter Heitzman Denali Arts Council proudly presents live in concert Karen The Spiff ‘One Soul’

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2011 World Ice Art Championships 26

Ice Park offers the best in family entertainment. Ice Alaska is in its 22nd year hosting the largest annual ice art competitions and exhibitions worldwide. The Fairbanks event has grown to a month-long attraction, involving more than 70 teams from all over the world. The competitions and the accompanying kids park attract more than 100 ice artists and approximately 45,000 visitors from Alaska and across the globe, 10 a.m. to 10 p.m. daily. Contact: 907-451-8250.

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art. Reserved seating only. Centennial Hall, Saturday, 7 p.m., runway show starts at 8 p.m. Sunday 2 p.m., runway show to start 3 p.m. Contact: 907-586-2787.

Savoca and Peter Heitzman. First meeting on stage some 20 years ago, they quickly became ideal music partners.

Savoca’s hand percussion infuses the music with her love of soul, R&B and world rhythms. She and innovative guitarist Heitzman combine to produce outstanding acoustic soul music that has been described as funky and spontaneous.

According to signer/songwriter Greg Brown, “If she were a Native American, her name would be Sings Like Two Birds.”

Tickets go on sale online on Tues., Feb. 1. Performance at 7 p.m., doors open at 6:30 p.m. Cost: $12 DAC members and lodging guests, $15 general admission. Contact: 907-7332330, www. www.denaliartscouncil.org.

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Crimes of the Heart

Community Theatre Productions presents Beth Henley’s “Crimes of the Heart,” directed by Tim James. A must see.

Performance dates: Feb. 4 and 5 at 7 p.m. at the Valdez Civic Center. Tickets: $10, $5 for seniors and PWSCC employees, free for students. Contact: Dawson Moore 907-834-1614.q

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

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19

OP-ED

Hiring Military Veterans is Good Business

Unemployment rates high for these individuals

By Bill Whitmore

I

f your company’s diversity recruiting strategy fails to include military veterans, you are missing out on working with some of our country’s most outstanding men and women.

Organizations that fail to recognize the extraordinary leadership qualities veterans bring to the workplace pass up the opportunity to work with results-oriented employees who have a strong sense of accountability and responsibility. It is time for our country’s corporate leaders to awaken to the reality that combat leadership and military discipline translate into dynamic employees who can enhance an organization’s productivity.

While the national unemployment rate hovers around 9.7 percent for civilians, the unemployment rate for young male veterans, including those returning from Afghanistan and Iraq, is more than double the national average at 21.6 percent, according to the Bureau of Labor Statistics. Isn’t it time to shine the employment spotlight on the brave men and women who serve our country?

What essential set of life skills do military veterans bring to corporate America that makes them an indispensable pairing? The military trains our men and women to lead by example, as well as understand the nuances of delegation and motivation.

As General Douglas McArthur once said: “A true leader has the confidence to stand alone, the courage to make tough decisions, and the compassion to listen to the needs of others.” Military veterans understand the value of teamwork, which they

20

Bill Whitmore

can apply in our country’s offices and board rooms. Veterans understand their role within an organizational framework and serve as exemplary role models to subordinates while demonstrating accountability and leadership to supervisors.

Veterans generally enter the work force with identifiable skills that can be transferred to the business world, and are often skilled in technical trends pertinent to business and industry. And what they don’t know, they are eager to learn – making them receptive and ready hires in work environments valuing ongoing learning and training. Veterans represent diversity and collaborative teamwork in action having served with people from diverse economic, ethnic and geographic background – as well as

race, religion and gender. Even under dire stress, veterans complete tasks and assignments in a timely manner as they have labored under restrictive schedules and resources on the battlefields and military installations they’ve served.

Employers can find qualified veterans from a variety of sources including the Employer Partnership of the Armed Forces, Employer Support of the Guard and Reserve, Military.com, HireVeterans.com and the Wounded Warriors Project. Employers can become true partners with selected veterans’ organizations and work with them proactively to ensure they are maximizing their ability to recruit from this extremely qualified talent pool.

Lest we forget, the men and women who have chosen to serve our country are patriots who have made enormous sacrifices to ensure our safety and freedom. By employing military veterans, we are saying, “thank you for your service” and for protecting us from terrorism and other threats. q

About the Author

Bill Whitmore is chairman, president & CEO of AlliedBarton Security Services, www.alliedbarton.com, the industry’s premier provider of highly trained security personnel to many industries including commercial real estate, higher education, health care, residential communities, chemical/ petrochemical, government, manufacturing and distribution, financial institutions and shopping centers.

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

Ed does a bit of everything as a Crowley fuel facility supervisor in Galena. He also does a bit of everything in his community, including serving on the school board, coaching basketball, and being a member of Civil Air Patrol.

Like Ed, Crowley is dedicated to giving back to the communities where we operate. That’s why we’re committed to 100 percent local hire in Western Alaska and to our employees who serve their communities. Because, after more than 50 years in Alaska, we agree with Ed that this is a “great place to work, live and have fun.”

For service in your area, call Crowley statewide at 1.800.977.9771.

EDUCATION

AKSourceLink:

Networking For Alaskans

Help for Alaskans in business start-up

By Mary Edmunds

A

KSourceLink is a community referral network for start-up and growing businesses. There is no charge either for user or resource provider. The network has a website and a toll-free hotline staffed Monday through Friday from 8:30 a.m. to 4:30 p.m. As Linda Ketchum, manager of the program, describes it, “We don’t provide the services. We just make the connections.”

This Alaska-based network is affiliated with USSourceLink, an outgrowth of the KCSourceLink started in Kansas City, Mo. In 2003, individuals at the University of Kansas got together to form an accessible network of the many organizations working to help business people searching for answers.

It was started in partnership with the Small Business Administration and the Kauffman Foundation located in Kansas. In 2004, USSourceLink was formed to expand the network.

AKSourceLink functions under the auspices of the Center for Economic Development (CED) at the University of Alaska. The CED is housed in Anchorage, but is a statewide University of Alaska program. The CED conducted a survey a few years ago interviewing business owners in communities with populations between 200 and 1,400. Many of the participants said they had problems finding and connecting with the resources that could provide answers.

Start Up

AKSourceLink was started by the Alaska Entrepreneurial Consortium, a group of 16 organizations, in conjunction with the university. In 2007, Christi Bell, the executive director of the CED, was at an International Economic Development Conference where she learned about USSourceLink, a model for the sort of resource network-

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ing needed in Alaska. The CED put in a proposal to the Denali Commission, which had funds to award to a project promoting economic development in Alaska. It was launched in July 2009. Linda Ketchum, the program coordinator, has a master’s degree in adult education and has taught courses in entrepreneurship.

Implementation of the project involved traveling to more than 20 rural communities to learn about area needs.

Workshops were held in these communities and small business resource expos were conducted in Southeast Alaska in conjunction with the Juneau Economic Development Commission.

Attendees of these workshops included people who could provide technical assistance and training and others who were interested in starting or expanding businesses. All types of industry were represented, mostly businesses one would expect in small communities.

While the program is not based on a social entrepreneurship model, it does contribute to the well-being of communities.

“When you are doing economic development in Alaska, you are really

doing community development as well,” Ketchum says. “Part of the reason for supporting emerging entrepreneurs in rural Alaska is giving people a way in which they can stay in their communities and make a living.”

Developing AKSourceLink as a web-based resource makes sense in Alaska, with its comparatively small population spread over a wide territory. The U.S. Census Bureau recently reported Alaska is second in home Internet access. The connectivity with villages has been improving, making access easier. USSourceLink provides a web platform AKSourceLink can tailor to the needs of Alaskan residents.

As of October 2010, there have been almost 6,000 visits to the website. Individuals searching for customized services have conducted around 800 searches since its launch. These have come from all over the state, including many small communities.

Some areas focus on one industry.

For instance, according to Alice Ruby of the Bristol Bay Economic Development Corp. in Dillingham, most of the residents are looking for sources related to commercial fishing. In Bethel, the Lower Kuskokwim Development

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

Getting Help Moving from boring to entrepreunership

O

By Mary Edmunds

n your way to your boring job in the morning, you stop for coffee. The brew is bitter and the pastry stale. I can do better than this, you tell yourself. You know coffee blends and your Aunt Fanny taught you her apple strudel recipe. The idea simmers in the back of your mind, but you have no idea how to start a coffee shop business in your small community. That’s where AKSourceLink comes in.

Your idea is percolating, so you grab a mug of French roast and a slice of Aunt Fanny’s apple strudel and sit down at your computer to log on to www.AKSourceLink. com. The site is easy to navigate. But first, you decide to see if you are suited to be an entrepreneur. Under the Resource Library, the SBA section “Getting Started” has a self-awareness test for this purpose. After all, you don’t just need a recipe for Aunt Fanny’s strudel; you need a recipe for business success.

This test explores your personal characteristics and your reasons for going into business. Are you competitive? Do you like making your own decisions? Are you aware running a business may require more time than your boring job, instead of picking up a cup of coffee at 8 o’clock, you’ll probably find yourself going to work at 5 a.m. to start the coffee brewing? There are questions about your knowledge of the financial and organizational skills necessary. It asks if you are willing to lose your life savings. (Ouch!)

If you decide you are fit for entrepreneurship, the next step is to go to the Resource Navigator and put in your information.Your zip code sorts out resources most convenient for you. You tell whether or not you have a business plan and if your business is in the concept stage, start-up, established or one with more than a million dollars in revenue.

There is a list of 25 industries to choose from, such as agribusiness, energy, restaurant or tourism. There is also a place for identifying yourself as a minority or as a woman. After you put in your information and hit search, a list appears of organizations, their descriptions and their distance from you. After that, it is up to you to contact the organization to get the assistance you need.

Alaska has many isolated communities with economic struggles. With AKSourceLink, emerging businesses and established businesses looking for help in finances, legal forms or marketing are now part of a statewide network. Aunt Fanny would love that. q Council has held workshops to introduce the service. According to the executive director, Carl Berger, “People in the area are interested in starting small stores or maybe doing some sort of piece work or arts and crafts to sell.”

Learning Curve

Most are in the concept or the startup stage. More than half do not have a business plan. The categories they search for most are in financial assistance, business planning and marketing. The hotline is used less often, probably because many small-business owners search on the web after work hours, when the hotline is not available.

There are now more than 120 re-

source partners, consisting of nonprofits, Alaska Native organizations, university programs and governmentservice providers. With AKSourceLink online Resource Directory, partners can connect with more entrepreneurs.

Also, clients who have inquiries outside the resource partner’s scope can be easily referred to other sources.

Business news is available on the website and the calendar posts notices of events and workshops.

In October 2009, the University Economic Development Association gave AKSourceLink the 2009 Award of Excellence in the Excellence in the Partnership Development category at its national conference in San Antonio, Texas. q

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

23

TECHNOLOGY

Biometrics Making it easier to tell if people are who they say they are Photo courtesy of Emily Bryant, Providence Health & Services Alaska

By Tracy Barbour

Biometrics, a Growing Trend

A

t Providence Alaska Medical Center, fingerprint verification is a key step in the distribution and administration of medications. The hospital uses Pyxis Medstations to securely stock and dispense medications throughout its facility. To access a Medstation, authorized personnel must use their fingerprints or a self-selected user ID and password. In both cases, the system identifies the staff member and verifies who is accessing the Medstation.

Using the Pyxis Medstations gives Providence Alaska the benefit of digitally recording all activity conducted by staff members who access the system.

This allows the center to track how medications are dispensed, returned, or even wasted by each person who uses a Medstation, according to Andre Neptune, RPh, director of pharmacy at Providence Alaska. The fingerprinting

24

or biometric identification (BioID) system on the Pyxis machines is a vital part of ensuring that only authorized staff members have access to medications.

It also affords Providence Alaska the ability to effectively audit the use of all medications, including highly regulated controlled substances.

“Passwords can be usurped or stolen if not safeguarded carefully,” Neptune says. “Fingerprints, by contrast, are unique to each person and cannot be stolen or replicated and, as a result, the integrity of each staff member’s Pyxis machine access is ensured. An additional benefit is that the log-in process using BioID is generally faster than using a password that must be typed in using a keyboard. During emergencies, rapid and reliable access to medications is critical to the care of our patients.”

Photo courtesy of Providence Health & Services Alaska

Ronald Simono, a pharmacy manager at Providence Alaska Medical Center, uses biometric identification to access a Pyxis Medstation. Providence Alaska Medical Center uses Pyxis Medstations to securely stock and distribute medications throughout the medical center.

The use of biometric technology, like Providence Alaska’s BioID system, is becoming increasingly common in corporate and public security systems in Alaska and elsewhere. Biometrics is the science and technology of measuring and analyzing biological data.

In information technology, biometrics refers to technologies that measure and analyze human body characteristics, such as DNA, fingerprints, eye retinas and irises, facial patterns, ear lobe geometry and hand measurements for the purpose of verification or authentication. The technology also involves evaluating behavioral characteristics, such as how a person speaks, walks and even writes.

As an important distinction, biometric verification relates to assessing biological traits to identify people.

Andre Neptune, RPh Director of Pharmacy Providence Alaska Medical Center

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

Typical forms of identification are social security numbers, driver’s licenses and fingerprints. Authentication takes verification to the next level. It’s the process of determining whether someone is, indeed, who he or she claims to be.

Biometric technology uses physiological or behavioral traits to grant or deny access to data, mechanisms or points of entry. It can be used in any situation requiring accurate identification of an individual. For example, iris-pattern and retina-pattern authentication methods involving eye retinas and irises are reportedly being employed in some bank automatic teller machines. Voice wave recognition is being used to grant access to proprietary databanks in research facilities.

Facial-recognition technology has been used by law enforcement to pick out individuals in large crowds with considerable reliability. Hand geometry is being employed to provide physical access to buildings.

Regardless of the method being used, the identification verification process follows the same basic steps.

The individual’s unique characteristic is recorded in a database. Then whenever identification verification is needed, a new record is captured and compared to the previous record in the database.

If the data in both records matches, the person’s identity is confirmed.

Fingerprints Most Common

Fingerprinting is the most common form of biometric verification.

However, the use of biometrics is increasing with the advancement of computer technology and digital data, allowing individuals to be identified almost instantly.

In Alaska, fingerprinting is a steadily growing trend, according to Clifford Smith, president of VIP Alaska Inc. Years ago, the only people who would do fingerprints would be the police department, and now there are so many people being fingerprinted police departments are “turning people away,” he says. This has stimulated the growth of local businesses to fill the expanding need. “Organizations want to ensure the people they hire are who they say they are,” Smith says. “They want to make sure the money they’re investing in an individual is wisely spent.”

Located in Soldotna, VIP Alaska specializes in providing fingerprinting, employee training, ID cards and background checks in Kenai. Most of the company’s business is for customers who are mandated to do fingerprints as part of a background check, such as truck drivers who want to be licensed to carry hazardous materials or homehealth workers.

VIP Alaska does fingerprinting the traditional way with ink and paper.

It also uses Live Scan technology to provide clients with inkless electronic fingerprinting. Live Scan offers compelling advantages. Digitizing fingerprint images allows VIP Alaska to electronically submit fingerprints to the appropriate location in a matter of seconds, instead of the days that are typically required to send hardcopy fingerprint cards through the mail. Live Scan also allows the company to avoid smudging, smearing and other problems associated with ink-based prints. “The movement in the industry is toward the Live Scan because of the ease of using it and the speed and convenience of transmitting information electronically,” Smith says.

The cost of fingerprinting at VIP Alaska is relatively inexpensive. For example, $25 is the going rate for printing all 10 fingers, and it includes up to two fingerprint cards. VIP Alaska provides a variety of fingerprinting and other personnel services from its Beach Road office. It also has a mobile fingerprint kit to serve clients at their location.

Biometrics Not 100 Percent Accurate

As a caveat, the use of biometrics for identification verification isn’t foolproof. With fingerprinting, for example, ink that’s too smudged or lightly applied can compromise the integrity of the prints. Likewise, an inept fingerprint technician can cause the Live Scan machine to produce inaccurate images.

Even biometrics involving the iris, retina and DNA are not 100 percent accurate, according to University of Alaska Anchorage professors Bogdan Hoanca and Kenrick Mock, who have been researching biometrics, particularly iris and eye tracking.

Iris and retina recognition tend to be more precise than fingerprints for

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

25

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identification purposes, but verifying patterns can be tricky. People have different patterns with their left and right iris, and a person’s retinas can be affected by diseases like diabetes and pregnancy, says Hoanca, assistant professor of computer information systems.

In addition, biometrics can be faked. For example, someone could use another person’s prints to deceive a fingerprint scanner. Or they could use a phony iris to get past an irisrecognition device.

As another wrinkle in biometrics, people with disabilities may not have certain biological features like eyes, fingers or a voice. In these cases, a more traditional form of verification would work best. “It comes back to the ubiquitous password,” says Mock, associate professor of computer science. “This seems to be the most common solution.”

Multi-factor authentication using biometrics represents another viable alternative. This security technique combines a variety of elements such as something a user knows (a password); something a users has (a smart card) and a biometric trait (fingerprint).

Multi-factor authentication is stronger and more difficult to compromise. It’s also more challenging to implement.

“It’s referred to as a good practice, but it’s not always common practice in business,” Mock says.

Hoanca adds that how multi-factor authentication is handled may depend on whether the individual needs to pass all the factors. “You might actually gain something by allowing the user to pass one of the factors,” he says. “This would be helpful if the user doesn’t have fingerprints or irises.”

At Providence Alaska, allowances are made for staff using the Pyxis Medstations.

“In rare circumstances,” Neptune says, “we have found staff members whose fingerprint impressions are so faint or fine that the system is not able to create the data file that correlates with that staff member’s fingerprint. In other cases, staff members with excessively dry hands that split or crack result in a changing fingerprint image that, over time, will not match the user’s login ID.

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

In these cases, we will have those staff members resume using a password to access the Pyxis Medstation system.”

Providence Alaska has been using BioID on Pyxis Medstations for more than seven years. During that time, the technology for scanning fingerprints and creating the data file that represents each person has improved and become increasingly reliable. This presents an opportunity for the hospital to further enhance the identification process. “With each upgrade, we go back to those staff who had previously failed BioID and challenge them to use the new version,” Neptune says. “Ultimately, it is to their benefit to use the most secure identity verification tools we can provide for securely accessing medications in our organization.”

Privacy, Security and Other Concerns

Privacy and security are key concerns surrounding the use of biometrics in business. “I’m not sure if a lot of people feel comfortable providing biometrics,” Hoanca says. “You have to give people an alternative; otherwise, you might get some resistance. Unlike some other forms of identification, biometrics is something you’re kind of stuck with.”

If a person’s fingerprints are stolen or compromised, it represents a major threat to their personal identity. That’s why companies must be very careful how they harvest and store biometric data. Hoanca says, “The way businesses have a fiduciary responsibility to safeguard other data, they have the same responsibility with biological data.”

Phasing in biometric technology with regular business processes can be a complicated undertaking that requires the right infrastructure. It also demands specialized training to ensure personnel know how to properly use and secure biological data.

In an effort to safeguard individuals’ biometric information, Alaska State Sen. Bill Wielechowski sponsored SB 190, mandating: “A person may not retain or analyze, or disclose or distribute to another person, biometric information on an individual without first obtaining the informed and written consent of the individual.”

(Law enforcement and other parties

authorized by State or federal law would be excluded.) Violators would be liable for actual damages and civil penalties up to $100,000.

In his sponsor statement, Wielechowski wrote: “At this time, many potential uses of biometric information are still at the rudimentary stages of development. However, new technologies will soon be available that will be able to make use of this information with chilling consequences for individual privacy and civil liberties.

Examples of the potential misuse of biometric information include the collection of an individual’s DNA by potential employers or insurers to weed out applicants that may have a genetic predisposition toward certain illnesses; and the use of video surveillance enhanced by facial recognition technology to track citizens’ movements without their knowledge.”

SB 190 is meeting strong opposition from Virginia-based Security Industry Association (SIA). The international organization says the legislation would adversely impact the use of biometrics for security purposes and expressed in a

letter to Wielechowski that it would have “unintended negative consequences.”

In the July 30 letter, SIA CEO Richard Chace states: “Biometrics provide an effective measure against fraud and identity theft in applications as diverse as personal access to buildings/computers, banking security, business-tobusiness transactions and e-commerce.”

Similar legislation was defeated in 2010 in New Hampshire following lobbying efforts by the SIA. As the owner of VIP Alaska, Smith is concerned about the potential misuse of biometric collections devices – whether it’s Live Scan fingerprinting, retinal scan, facial recognition or DNA collection. However, he’s against any regulations that would make it harder for authorities to ensure people are who they say they are. Instead of focusing on the use of biometric information, he says, SB 190 should be centered on the misuse of biometrics. He adds: “These are fantastic tools, and if used appropriately, they can rapidly verify that people who pose a threat to personal or national security are identified in a q timely fashion.”

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

27

Towns

in

Transition

Newtok Is Drowning Move or be washed away only options for community

By Heidi Bohi Photo by Stanley Tom, NTC

28

Nada

“Because of the relocation, there is nothing we can do,” Tom says, adding that in the meantime residents stand by helplessly watching the village deteriorate, knowing that time is not on their side.

Until enough residents actually relocate, State and federal agencies cannot justify providing funding for subsidized housing and basic services in the new location. At the same time, despite the unhealthy and dangerous current living conditions, it is difficult for locals – many who are elders – to make the decision to leave the only home they have ever known to settle in a place that does not yet have even basic services such as electricity and sanitation services.

“We don’t want to leave our subsistence ground, we were born here, but we can’t do anything about it – our village is just going to wash away,” Tom says.

Loss of a critical land buffer to erosion has made the village increasingly vulnerable to storm surge and flooding. During the fall 2005 storm, the village was turned into an island; some homes were only connected to the village by boardwalks floating in the water.

This is not the first time Newtok has had to escape the ravages of the sea. First reported by the U.S. Geologic Survey in 1949, villagers had moved to Newtok from Old Kealavik, just across the river from the current site, because of the seasonal flooding. The current site was selected because it was the farthest point upriver that the Bureau of Indian Affairs

Photo by Stanley Tom, NTC

J

ob creation, the economy, energy prices, social perils – these are some of the common issues that community leaders statewide list as they struggle to balance basic needs and quality of life in the face of limited resources, shifts in administrations and disenfranchised residents.

In Newtok, a subsistence village of about 360 on the Ninglick River near the Bering Sea, mere survival is the talk of the town as it watches the north banks erode, taking with it the 66 homes here and destroying other critical community necessities, such as the barge landing and community tank farm. Although it has selected a new community site nine miles southeast of Newtok, and is beginning the slow, painful relocation process, for now the village is in a chicken-egg holding pattern, says Stanley Tom, tribal administrator for the Newtok Traditional Council.

Advancing erosion, increased flooding and the resulting loss of Newtok’s infrastructure makes securing public funding for rebuilding more critical than ever. Public agencies are delaying these awards, though, resistant to invest in new capital facilities that certainly will not remain standing when the Ninglick River predictably arrives at their doorsteps.

Questions, No Answers

To date, Tom says, there is no accurate estimation of when the relocation will be complete, though 2014 is one projection. Although the tribal government and government agencies are working cooperatively, funding is scarce on all fronts.

The area where Newtok’s barge landing was located, now eroded away by the advancing Ninglick River. The drill rig in the water was once on land.

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

Plan of Action

By 1994, the Traditional Council started a relocation planning process to address the problem, including evaluating six potential village relocation sites. The selected site, called Mertarvik and a Yup’ik word for “getting water from the spring,” is on the north end of Nelson Island and within the Yukon Delta National Wildlife Refuge, managed by the U.S. Fish and Wildlife Service (USFWS). Then, in 2000, a consulting group was hired to help develop the relocation plans through funding provided by BIA and the U.S. Army Corps of Engineers (USACE).

An act of Congress ultimately resulted in Newtok acquiring the land for the new site after negotiations between the Yukon Delta National Wildlife Refuge with the U.S. Fish and Wildlife Service (USFWS). The land exchange was supported by Alaska’s congressional delegation and the Newtok Corp. helped them secure the votes needed for the enactment of the land exchange law.

This erosion also presents a set of problems that impact economic development, supply of goods and services, and the health of local residents. Fall storms send floodwaters into the village taking – or destroying – everything in the way, including the land buffer between the Ninglick and Newtok rivers that protected the village. At the same

Photo by Sally Russell Cox, DCCED/DCRA

(BIA) barge could navigate to offload materials for building the school. Over the next three decades, Newtok residents became increasingly aware of the north bank of the Ninglick River being eroded.

The city requested and received funding from the Alaska Legislature to assess the erosion problem and evaluate alternatives for erosion control along several miles of the riverbanks.

Historically, bank erosion rates between 1957 and 1983 show that the north bank of the Ninglick River had fallen away at an average annual rate of 19 to 88 feet and if the erosion was not decelerated, community structures would wash away by 2013. But to adequately slow the process along the entire length of the Ninglick River would be cost prohibitive. “Relocating Newtok would likely be less expensive than trying to hold back the Ninglick River,” the study said.

Newtok residents listen intently to relocation updates at a community meeting.

time, this alters the flow of the Newtok River, transforming it into a slough, which is similar to a mud flat that is too shallow and built up with silt to allow for the busy boat traffic the community once knew. Since the village barge landing was lost to erosion in 2005 the community has had no affordable way to receive goods such as construction materials and fuel. Human waste also is dumped from honeybuckets into the Newtok River and when the wind blows from the east the entire village smells.

The Newtok Planning Group (NPG), coordinated since 2006 by the Department of Commerce’s Division Community and Regional Affairs (DCRA) coastal impact and climate change programs, is an interagency planning group that assists the village with relocation efforts. Federal, State, local and regional partners are included in the planning and look for ways to leverage resources between agencies.

The NPG partnership was strengthened in 2008 by the addition of the

Photo by Stanley Tom, NTC

military Innovative Readiness Training Program (IRTP), which assists remote communities while training military personnel. In the case of Newtok, the IRTP made a five-year commitment to the relocation effort by providing labor and transporting materials and equipment for the construction of infrastructure at the new village site. This year, it will help build an evacuation shelter for residents to use if the current village floods during storms.

“We knew we would not be working from a huge pot of money,” says Sally Russell Cox, DCRA planner and program manager. “We have to plan in an unprecedented way.”

Timeline

Cox is working with Newtok to develop a strategic management plan for the relocation, which includes developing a timeline and determining what role each agency will play in the effort. Some of the first improvements on the list are building an evacuation shelter, a barge landing and an access road from the barge landing to the village site. The State and the Corps are also developing a quarry site this winter so that the community’s gravel needs can be affordably met.

Although local residents have many challenges ahead, including pioneering the new site so they can build a population base that warrants getting federal funding, Cox says as accomplishments are starting to be realized residents are more encouraged.

“They have hope because they can see things happening now,” Cox says. q

The waters of the Ninglick River melt the underlying layer of permafrost in the riverbank. The unsupported top lay breaks off in huge chunks, exacerbated during coastal storms. www.akbizmag.com • Alaska Business Monthly • February 2011

29

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Towns

in

Transition

Girdwood Paradise with worldwide lure

Photo by Simon Evans

Jason Scheben finds the perfect turn on the upper mountain.

By Heidi Bohi

W

hen it comes to developing Girdwood into a fourseason year-round resort town, ain’t no mountain high enough to curb the enthusiasm of local residents and leaders who believe their piece of paradise has the potential to attract visitors worldwide.

Just 38 miles south of Anchorage, but with back-door wilderness opportunities offering everything from world-cup skiing and snowboarding to hiking, mountain biking, hanggliding and whitewater rafting, Girdwood may turn out to be a prime example of what is possible when the public and private sectors partner in community development.

32

Residents and Outside snowbird investors have always had strong — and often opposing — opinions on what direction the community should head when considering development options, resulting in providing basic services and infrastructure for residents, along with creating more year-round jobs that contribute to economic development and sustainability.

Although there have been grassroots efforts to advance local improvements, in the past most of these efforts have stalled or failed because of a lack of concerted effort needed to advance the idea and secure funding and investors.

Change in Works

But that is changing. Over the last decade, cooperative public and private efforts have given Girdwood the momentum it needs to start to realize a master-plan vision that is, most agree, attainable.

In 2000, the organization Girdwood 2020 was founded to advocate for the development of the GlacierWinner Creek recreation area, a mountain massif between Glacier and Winner creeks, long recognized for its potential as a new downhill ski area.

The mountain could accommodate a ski area with year-round glacier skiing, more than 5,000 feet of vertical drop, and about 12,000 people, or

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

Funding First

Part of the challenge is securing funding for many of these projects, says Diana Livingston, chair of the organization.

“Girdwood is its own worst enemy in many instances,” she adds, saying many of the same people who come to the community for the resort, or rely on it for employment, oppose anything resembling progress.

The pivotal point for the community’s growth is Alyeska Resort, which includes the 304-room Hotel Alyeska.

When Seibu Corp. invested $200 million in 1994 and opened the property, along with the 60-passenger high-speed tram, two quad chairlifts and a new day lodge, locals thought the development might be the critical step needed to turn Girdwood into a resort town similar to Vail or Sun Valley. Instead, the property struggled from day one, plagued by unexpected market shifts, failure of the Winter Olympics bid, and a change in air routes that made travel from Japan more difficult, which was expected to be its largest international inbound market.

New Blood

It was not until 2006, when millionaire and real estate mogul John Byrne purchased Alyeska Resort for tens of millions of dollars, that bar-stool banter about grand ideas evolved into organized efforts to work with the Municipality of Anchorage and the

Alaska Legislature to build on the new opportunities presented by Byrne’s personal resources and his vision, including advancing the Glacier/Winner Creek project.

Unlike his predecessors, Byrne was the first to tell Girdwood 2020 and the community he would be the developer who could work with the city and see the project to fruition.

Although they’d heard this before, he pointed out a big difference between him and his predecessors: “When we present our master plan, I’ll actually be able to fund it,” he said during one of his first public addresses after buying the resort.

Byrne has been a man of his word, investing significantly in both the resort and the community. Since he purchased the property, he has invested more than $20 million to make the resort more of a year-round attribute offering activities for all ages and abilities and catering to local skiers. Improvements include adding a new chair lift to accommodate more people, adding mountain biking and hiking trails off the north face and from the back of the hotel, trail widening, and the addition of two magic carpets —moveable walkways that take skiers to the chair lift and are easier for children to use — increasing the amount of beginner terrain, beginning a snow-making project from the base of the mountain to the top, and adding a midway station to Chair 7.

Great Growth

Revenues have grown from $22 million to $30 million a year, resulting in it paying in excess of $5 million in bed and property taxes. Today it also employs more than 700 during the peak seasons, up from 400, and Byrne continues to find ways to extend the spring and fall shoulder seasons so the economic benefits can be spread throughout the year.

At the same time, he considers community input and recognizes that developments should maintain the small-town feeling there and consider short- and long-term growth that preserves open space, good views and other natural features, while also considering future developments that, phased in as demand dictates and funding becomes available.

Byrne also helped secure and

Photo courtesy of Alyeska Resort

three times the capacity of the existing Mount Alyeska ski area.

Besides the downhill potential, the area is ideal for backcountry skiers, mountaineers and summer hikers, and has high scenic and recreational values.

Although the giant undertaking has been tabled until investment capital and legislative support can be garnered, today Girdwood 2020 continues to be a respected advocacy group dedicated to making the community grow as an internationally recognized resort, developed through environmentally responsible economic measures.

The group continues to advance other efforts, such as advocating for basic water, power and sewer infrastructure, road improvements, multiuse trail development, and getting a high school built in the community.

Ski Area General Manager Di Hiibner nears the crest of Headwall.

match $800,000 in federal funding to start Glacier Valley Transit, which is a local public transportation company that operates a fixed route in Girdwood. It is one of many instances where Byrne, rather than hold up progress because of a lack of public funding, took matters into his own hands, recognizing the success of the resort and the success of the community are intertwined and attracting investment capital to develop the base of the mountain and the community is the engine behind sustainable economic development.

Sullivan Helps

Although past administrations have done little to advance Byrne’s vision, Anchorage Mayor Dan Sullivan, who has been frequenting the community since he was a small child, recognizes the economic development benefits Girdwood’s prosperity will mean for the Municipality of Anchorage and the entire Southcentral region.

“I am impressed by John Byrne and other folks in the private industry who are willing to invest millions of dollars in the community,” Sullivan says. “The municipality has a responsibility to invest and do our part, too, to make sure there is good infrastructure to compliment the investment. We need to be a good partner.” q

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

33

HR M at t e r s

By Lynne Curry

Protecting Your Company

O

n March 16, 2010, the IT staffing firm TEKsystems Inc. sued three of its former employees and their new employer, Horizontal Integration Inc. Because TEKsystems based its lawsuit on what it learned through the social media LinkedIn, their case carries meaning for all employers wanting to protect their company’s interests or those who might find themselves on the receiving end of this type of lawsuit.

TEKsystems employs engineers and other technical professionals. Like other consulting and service companies they invest heavily when recruiting and training their employees. When the company places their highly skilled employees on a temporary basis in companies throughout the United States, sometimes their employees attempt to strike a deal with these clients: hire me and you’ll pay less for me as an employee than you’d pay for me as a contractor, but I’ll make more money.

TEKsystems loses.

As a result, TEKsystems developed noncompetition, nonsolicitation and nondisclosure agreements with its employees, prohibiting them from taking jobs with the clients for 18 months after leaving TEKsystems, from disclosing TEKsystems’ business strategy to competitors and from soliciting other company employees to join them in future ventures.

When Brelyn Hammernick started work as a recruiter for TEKsystems, she

The 65 million registered users of LinkedIn create a profile listing their current and former employment and “connect” to professional contacts to find jobs, resource information, contacts and business opportunities.

34

signed a noncompetition, nonsolicitation and nondisclosure agreement that bound her for 18 months after leaving TEKsystems. In writing, she agreed not to work for TEKsystems clients or competitors or to directly or indirectly approach, contact, solicit or induce any other employee she met by reason of her employment with TEKsystems to move to another company.

When Hammernick’s employment with TEKsystems ended, she joined Horizontal Integration Inc., another IT staffing firm. Via the social media LinkedIn, she then connected with 20 or more TEKsystems employees.

The 65 million registered users of LinkedIn create a profile listing their current and former employment and “connect” to professional contacts to find jobs, resource information, contacts and business opportunities.

In violation of her employment agreement, Hammernick connected with 16 current or former TEKsystems employees.

In one exchange with a TEKsystems contract employee, Hammernick wrote, “Tom, let me know if you are still looking for opportunities! I would love to have come visit my new office and hear about some of the stuff we are working on!”

Tom replied, “Indeed I am still looking. Let’s get together.”

This case raises novel legal questions. Does connecting with professional contacts via professional networking websites violate an antisolicitation covenant? Does a network of professional contacts equal solicitation? Does compliance with a nonsolicitation restriction require individuals to “de-friend” colleagues, customers or clients of former employers until the non-solicitation period expires?

Will employment agreement compliance require individuals not to connect

©2011 Chris Arend

Noncompete and other agreements help secure assets

with or friend colleagues, customers or clients of a former employer during a non-solicitation period?

As TEKsystems, Inc. versus Hammernick et al. heads for trial, employment attorneys urge employers to get ahead of the power curve. Social media makes it increasingly easy for former employees to urge a company’s current employees to seek new and greener pastures. Given the spread of social media, employers may need to update their anti-competition and nonsolicitation agreements, as well as their employee handbook code of conduct, nondisclosure, anti-harassment, nondisparagement, anti-violence, confidentiality and post-employment policies. q About the Author Lynne Curry runs a Alaska-based management consulting firm with 3,500 clients in 14 states and three countries.

Her company specializes in management training and provides HR On-call services to clients. Her team includes a J.D. (attorney), an MPA (Master of Public Administration) and an SPHR (Senior Professional in Human Resources) and provides a free monthly Breaking News HR/management newsletter and two seminars monthly. For details, check out www.thegrowthcompany.com.

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

Legal Speak

By RonBy“CJeff at” W Maller ason

Confidentiality Agreements

H

Keeping business secrets in-house

ow does your company protect important information that gives your business a competitive edge, and is at risk of walking out the door with a departing employee?

How do you prevent current employees from sharing the information with individuals working for your business rival?

Regardless of the state of the economy, businesses want to protect their competitive edge. However, a business cannot prohibit every departing employee from working for the competition. How can you minimize these risks?

For example, your company implemented a strategy to lower operational cost for handling walk-in customers, the system provides a competitive edge, your business rivals are not using a similar process, and a salesperson trained in the system is leaving your company.

Does your company have to stand by and watch a knowledgeable employee go to work for the competition and then hope that the ex-employee does not share any information about the system or its benefit?

The Dotted Line

Many businesses are addressing this issue by requiring all employees sign a confidentiality agreement. The agreement does not prevent a departing or ex-employee from working for a business rival or from going into competition with your business, like a non-compete agreement. And unlike a non-compete agreement, a confidentiality agreement is not limited mainly to upper-level employees or employees with the financial capability to enter into direct competition with your business. Instead, confidentiality agreements can apply to all employees.

The purpose of a confidentiality agreement is to prevent a current or departing employee from disclosing business secrets without permission from the business. Normally, the agreement

© Chris Arend 2011

Jeff Waller

does not actually describe a particular process or secret. Rather, the agreement describes the types of information, systems, or processes covered by the agreement.

Beyond trade secrets, the agreement can apply to any information providing a business with a competitive edge, including business practices, operation policies and procedures, computer processes, research and development strategies or matrixes, research projects, services, vendors or suppliers used, pricing strategies, customer lists, customer prospects, production sourcing, marketing and selling, financial information, personnel information, and even the terms and contents of employee agreements.

Secrets Kept

Basically, the agreement is drafted to protect any type of important or confidential information an employee receives as a result of employment with the company.

Businesses implementing a confidentiality agreement typically require all existing and new employees sign the agreement. (This would not apply to employees covered by a collectivebargaining agreement or employees already under an existing employ-

ment contract.) The consideration required for the agreement to be legally enforceable in a state like Alaska, where an employee is considered to be at-will, is typically based upon the employee’s current and continued employment and compensation paid then and in the future. Consulting with your attorney for guidance in this area is always a good idea. For potential hires, the confidentiality agreement would be included as part of the hiring process with the agreement being presented to a potential hire before the first interview.

Confidentiality agreements also include other provisions concerning enforceability of the agreement after termination of employment, the length of time the agreement is in force after the employee leaves employment, and in the case where the employee breaches the agreement, provisions on enforcement of the agreement, the obligations of the employee and the remedies available to the employer.

Depending upon the type and location of your business, each of these can vary. Your attorney can give you specific guidance on these issues.

A confidentiality agreement helps makes sure your business secrets stay secret, and also informs your employees they have a duty and obligation not to share or divulge this information.

If a current or ex-employee breaches the agreement, then your business has the ability to take legal steps to protect q those secrets.

About the Author Jeff Waller is a senior associate attorney at Holmes Weddle & Barcott P.C. in Anchorage. His practice includes litigation, construction law, employment law, insurance defense, and real estate matters. Prior to becoming an attorney, Waller owned and operated several businesses.

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

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ASSOCIATIONS

Associated General Contractors of Alaska Representing the Industry Helping contractors have a voice

By Tracy Barbour

A

Photo by Azimuth Adventure Photography/www.azimuthadventure.com

ssociated General Contractors of Alaska was organized in 1948 to provide a collective voice for contractors working throughout the state. AGC of Alaska negotiates collective-bargaining agreements with the unions – seven unions, to be exact.

However, today the nonprofit trade association has expanded well beyond its original purpose. It has an active management team that takes a broad interest in the industry.

“We represent the construction industry, and sometimes our representation supports the union side and sometimes it doesn’t,” says Executive Director John MacKinnon. “Our efforts are to support the industry as a whole.”

There’s a misperception the AGC logo equates to being union, MacKinnon says. Of the organization’s 664 members, 349 are associates, 119 are general contractors and 196 are specialty contractors. “Only about a third of the contractor members are union contractors,” he says.

Membership Base

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AGC of Alaska’s membership base is comprised of general contractors, subcontractors and industry professionals who are committed to improving the professional standards of the construction industry. These members represent five distinct categories: building division, heavy-industrial division, highwayutility division, specialty division, and associate members. AGC of Alaska members perform the majority of the state’s commercial and industrial as well as public and private construction work.

AGC has three types of members: contractor, associate and affiliate. A contractor, as defined by the

John MacKinnon Executive Director Associated General Contractors of Alaska www.akbizmag.com • Alaska Business Monthly • February 2011

organization, is any individual, firm or corporation who, by agreement with another party, undertakes to execute work in its entirety or as a subcontractor and who executes such work in whole or in part with its own construction forces. Only contractors with an established reputation for skill, integrity and responsibility are eligible for this type of membership. Contractor members also are members in Associated General Contractors of America.

An AGC associate is any individual, firm or corporation engaged in the manufacture or merchandising of materials, supplies or equipment to contractors, or in the furnishing of services to the industry, such as banking, bonds, insurance, architecture, engineering, transportation, or any other service not normally performed by a contractor. An affiliate is any individual sharing concern and interest in the construction industry.

Skill, Responsibility, Integrity

As part of its mission, AGC of Alaska strives to promote improved training, practices and ethical standards in the

construction industry. The chapter maintains high standards for skill, responsibility and integrity. AGC wants to ensure that Alaska contractors have the best-skilled, most competent work force in the state, said MacKinnon. It also strives to have a positive working relationship with contracting agencies.

“It’s our responsibility to make sure we are fulfilling the terms of our partnership agreements,” MacKinnon explains. “Our goal is when a contractor finishes a project, the owner gets the best project they could at the best price and the contractor makes a fair profit.”

Training and education are key components of ensuring skill, responsibility and integrity. Among other educational efforts required in today’s construction industry, AGC of Alaska has workshops on ethics and other training opportunities. It also holds meetings with federal contracting agencies like the U.S. Army Corps of Engineers. In addition, the association keeps in close contact with the Alaska Department of Transportation, which is the major contracting agency for the State of Alaska. AGC of

Alaska takes very proactive measures to create a good relationship and partnership with ADOT. “Without contractors, the State wouldn’t have construction programs, and without these agencies we wouldn’t have work to do,” MacKinnon says.

Key Concerns

AGC of Alaska is keeping busy addressing a number of issues. A key concern, MacKinnon says, is the government imposing more and more regulations on the construction industry. A prime example is the Environmental Protection Agency’s regulation of stormwater discharges from construction sites now being administered by the Alaska Department of Environmental Conservation (ADEC). These regulations, in general, help set storm water requirements for new development and redevelopment projects, and the first year with ADEC has been a positive one, MacKinnon says. “Keeping up with the requirements that are placed on the industry – mainly what comes down from the federal level – requires a lot of time,” he says.

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

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CHARACTER

QUALITY

The state’s harsh working conditions are also a major area of concern for AGC. Alaska has to accomplish in six months what most other states have all year to do. In response, the construction industry has adapted by using prefabricated component and structures to facilitate the construction process.

MacKinnon notes Alaska’s construction economy is flat, but still healthy.

A flat construction economy, he says, is good compared to what’s happening in other parts of the country. However, MacKinnon is concerned about the state’s image with the recent publication of CNBC’s Top States for Business 2010.

Alaska ranked as America’s bottom state for business, hampered by its high cost of living, transportation, energy, resultant high cost of doing business, and weak infrastructure.

CNBC’s fourth annual study of America’s Top States for Business measured all 50 states on 40 different metrics in 10 key categories of competitiveness. The categories were cost of doing business, work force, quality of life, economy, transportation and infrastructure, technology and innovation, education, business friendliness, access to capital, and cost of living.

Alaska has certain intrinsic factors that cannot be overcome. However, MacKinnon says, “There are actions that government has taken that make it a less attractive place to do business, including excessive regulation and raising taxes on the oil industry.”

Cultivating Constructive Legislation

VALUE

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AGC of Alaska also is interested in preventing harmful legislation and promoting constructive legislation. To support these efforts, the organization has an active legislative and political-action committee. It maintains close relationships with the state’s legislative bodies and reaches out to legislators on an individual basis.

“When it comes to working on issues before the Legislature, we get involved,” MacKinnon says. “We’re not shy about expressing our opinion.”

Like many organizations in Alaska, AGC holds a legislative fly-in, in which a few dozen of its members travel to the capital and meet with legislators to discuss various issues.

Alaska ranked as America’s bottom state for business, hampered by its high cost of living, transportation, energy, resultant high cost of doing business, and weak infrastructure.

“We also take our list of legislative priorities,” MacKinnon says. “This year we have one priority: the establishment of a State-funded transportation construction program.”

This has been on AGC’s list for many years. MacKinnon says Alaska has a transportation construction program that is primarily funded by federal dollars, and its future is uncertain.

“There are, however, many projects that get funded by individual appropriations of the Legislature with State funds, and while we appreciate every one of them, the project selections are based more on politics than on a prioritized need,” he says.

Instead, AGC would like to see Alaska replicate what many other states are doing: They take highway “user fees” – their fuel tax, motor vehicle registration fees – and place them into a State-funded program to pay for transportation-related construction projects that are prioritized by need, similar to what the State does with education facilities.

“What most other states have and we want to see, is a predictable youcan-count-on-it, state-funded program,” MacKinnon says. “Last year (in 2010), a bill that would have helped make this possible made it through the House and part way through the Senate. It didn’t happen last year, but it went further than it’s ever gone before.”

In the future, AGC of Alaska will continue pressing the issue and working to fulfill its role as an industry advocate.

MacKinnon says: “We want to keep on being the association that keeps looking out for the best interest of the business of construction in Alaska.” q

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

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BUILDING ALASKA

Strangling Regs Keeping construction projects at bay

By John MacKinnon

Executive Director Associated General Contractors

T

he average Environmental Impact Statement (EIS) for a federally funded highway project today takes five years to reach a Record of Decision. From that point, the project sponsor, usually the Department of Transportation, can then begin to get the dozens of required local, State and federal permits. The average time for a major highway project that requires an EIS, from beginning the EIS to completion of construction, is 13 years. Since most of Alaska’s road construction program is federally funded, is it any wonder why transportation projects take so long to deliver and lack of adequate transportation is one of the biggest impediments to our economy.

Forty years ago, the biggest obstacle we had to getting a transportation project going was scraping the money together. Today, the biggest obstacle we have is getting permission.

The Federal Highway Administration (FHWA) recently held a series of 10 regional summits across the country called Every Day Counts (EDC).

EDC resulted from questions raised two years ago when Federal Highway Administrator Victor Mendez was meeting U.S. senators on the Environment and Public Works Committee prior to his confirmation – it is

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that committee that confirms his appointment. The common question asked by committee members was, “What can be done to speed up the time it takes to deliver projects?”

The sooner projects can be delivered, the sooner the public can enjoy the benefits. A great idea – I don’t know anyone who isn’t frustrated with the length of time it takes to take a project from inception (need) to completion. Instead of telling the Senate committee members what the real problem is, the FHWA designed EDC to identify and deploy innovation aimed at shortening project delivery. Innovation that the FHWA presently has the ability and authority to do. We already know what innovative methods and techniques we have available. We use them regularly. The real problem is the 800-ton gorilla in the program. It is the crushing weight of more than 165,000 pages of federal regulations written by people who were not elected. Regulations that were written by bureaucrats so they can enforce the laws passed

by Congress.

The graph on page 42 clearly illustrates this problem. It shows the cumulative number of laws and amendments passed by Congress over the past 120 years that have an

John MacKinnon Executive Director Associated General Contractors

effect on the development of transportation projects. These laws range from the Rivers and Harbors Act (RHAA) of 1899 to recent amendments to the Clean Air Act. All were well intended laws at the time – who would argue that we

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

didn’t need the Clean Water Act after the Cuyahoga River caught fire in 1969? Rivers aren’t supposed to catch fire. We have corrected our environmental problems and we have the cleanest country on earth. Now a self-perpetuating bureaucracy and regulatory system has taken each of these laws and through the writing of regulations, stretched them way beyond their original intent. Ronald Reagan once said: “The tendency of government and its programs to grow is the closest thing to eternal life we have.” Unfortunately this eternal life is strangling this country.

We can all cite examples where many of these regulations have caused significant obstacles to and even stopped reasonable projects and developments. While the purpose of the law remains, the need has changed significantly. The high profile ones in the news – wetlands, polar bears and belugas - we know about. But the countless ones the public never hears about are a greater problem than the ones that make the news.

Bird Act? Cats Kill More

Migratory Bird Treaty Act (MBTA) of 1918 was first enacted between the U.S. and Canada for the much needed protection of migratory birds from the pressures of overharvesting from commercial hunters of the day.

The law was subsequently expanded to include agreements with Mexico, Japan and Russia and to include protection not only for the birds themselves, but also for their habitat. A well intended law – migratory birds don’t recognize borders, they don’t belong to any one country, and they need protection and management through such agreements. But the MBTA is now being used to slow our ability to clear brush along our roadsides and keep us from clearing trees for highway projects or any project in the spring when nesting birds might be present because of the potential to kill some birds. Putting the implementation of this law into perspective, your neighbor’s cat can kill more birds in a month than an average road project.

The National Historic Preservation Act is the most extensive www.akbizmag.com • Alaska Business Monthly • February 2011

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

preservation legislation ever enacted in the United States. Among other things, the act requires federal agencies to evaluate the impact of all federally funded or permitted projects on historic properties (buildings, archaeological sites, etc.) through a process known as Section 106 Review. In 2004, The State Department of Transportation began a number of projects to construct safety improvements to various intersections in Anchorage. Small safety improvements of this type are targeted at locations with high accident rates, and the improvements proposed have a documented result of reducing traffic accidents and injuries and even saving lives.

Since there was federal funding for these projects, a Section 106 Review by the State Historical Preservation Office (S H P O) and concurrence was required. The SHPO was concerned the improvements were not consistent with the historic nature of the neighborhood and wanted to study it further at DOT expense.

The Section 106 process that began

in the summer of 2007 continues today, and accidents and injuries continue to occur at these intersections throughout the Anchorage area.

The Clean Water Act (CWA) also brought us the National Pollution Discharge Elimination System (NPDES).

The NPDES is part of the enforcement responsibility of the Environmental Protection Agency (EPA) and is presently being administered, and very well I might add, by the Alaska State Department of Environmental Conservation. In construction, it is about reducing or preventing sediment-laden water runoff from construction sites from entering “waters of the U.S.” You can see efforts at reducing storm-water pollution at any highway construction project – one of these efforts is the short black fabric “silt fence” that is placed between disturbed soil (dirt) and vegetated areas. The purpose of the silt fence is to stop any sediment from being washed onto the vegetated areas and into streams in the event of a rainstorm. It works fairly well as intended

and properly installed. There are numerous other measures taken, but silt fence is probably the most visible and obvious.

The EPA has identified the construction industry as one of the largest water polluters in the U.S. because of the potential for storm water runoff, and they have targeted the industry for even further enforcement. According to data from the Economic Research Service of the U.S. Department of Agriculture, approximately 27 million acres of the 2.3 billion acres of the U.S. are used for transportation purposes – this includes all of the rights of way for highways, roads, railroads and airports. In a booming economy, I doubt that onetenth percent, or 27,000 acres, is being disturbed by construction at any one time – the construction industry should be so lucky. At the same time, U.S. cropland under cultivation accounts for 340 million acres, all of which is tilled and dressed continuously (OK, except for some farm subsidies). On sheer acreage alone, there’s no question agriculture activities result in far more pollution than construction activities,

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but Congress has exempted agriculture activities from having to comply with the CWA. On acreage alone, agriculture activities result in more than 12,000 times the land under disturbance than construction activities, and presumably over 12000 times the potential for pollution from sediment runoff. But because agriculture is exempt from the CWA compliance, the burden is all being directed at construction activities. I’m not suggesting that Congress eliminate the exemption and the EPA come down on our country’s farmers, but let’s put it in perspective, construction activities are not the problem.

The estimated annual cost of complying with EPA storm-water regulations on Alaska construction sites is over 5 percent of the entire annual highway construction program – more than $20 million a year. That represents one major highway road project a year we don’t do just so we might prevent some silty water from running into Cook Inlet. Have you looked at upper Cook Inlet lately?

It is silty and it is natural, but we can only let clear water leave our construction sites before running into the Inlet.

Can we deliver projects faster than at the glacial pace under which we presently do? Can we deliver faster and still protect the environment? Yes we can, and we do. The most recent and probably best example is the I-35 Bridge in Minneapolis that suffered a catastrophic collapse in August of 2007, killing 13 people and cutting off a major transportation corridor. The State of Minnesota, the administration and Congress made this a priority.

Within two months a design-build construction contract was let and in one year almost to the day of the contract, the new concrete structure was opened to the public. All without harm to the environment.

We mustered a similar response to rebuild the ravages of Hurricane Katrina. We’ve shown we can do it. We’ve shown we can do it without harm to the environment. We just need the administration and Congress to make transportation

“ Forty years ago, the biggest obstacle we had to getting a transportation project going was scraping the money together. Today, the biggest obstacle we have is getting

”

permission.

— John MacKinnon Executive Director Associated General Contractors

a national priority. Our competitors in the world economy have, but Washington continues to place a mountain of process and permits ahead of progress and the economy.

Our frustration with these laws and regulations is usually directed at the government employee whose job it is to administer them. They’re only doing their job and unfortunately often doing it too well. The finger of blame for all this is to the 535 elected members of Congress.

They are the lawmakers. They created the problem and they have the ability to fix it without pushing this country further in debt. These laws and regulations that are inappropriately applied erode our confidence in the federal government and ultimately, Congress.

As Pogo said “We have met the enemy and he is us.” q

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

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BUILDING ALASKA

Alaska Construction Forecast

Photos by Nicole A. Bonham Colby

Workers make progress on Ketchikan Indian Community’s Southern Southeast Alaska Vocational and Training School at 615 Stedman Street in Ketchikan. The large project encompasses the former Channel Electric building and the tribe’s adjacent property and is among efforts that fed the 2010 Alaska construction economy and will continue into 2011.

Above average and better than Lower 48

W

By Nicole A. Bonham Colby

ith the construction industry of the Lower 48 staggering from the weight of a national recession and widespread housing crisis, construction in Alaska enters 2011 suffering some peripheral impacts, but is also poised to benefit from dozens of large-scale public projects on the near horizon.

“From 30,000 feet, it seems to look steady as she goes” similar to last year, says Scott Goldsmith, professor of economics at the University of Alaska Anchorage (UAA) and director of its Institute of Social and Economic Research (ISER). “Public spending is certainly strong. The private sector is still a little weak, just because the overall economy is still (uncertain).”

As researchers begin crunching the 2010 numbers for detailed scrutiny,

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Goldsmith’s early, high-level analysis is mirrored by those in the trenches.

While the public sector continues to see roll-out of multi-year projects, like the State’s deferred-maintenance program, influences of the national recession and other cutbacks are more immediately evident in the private sector.

“From the private sector, we’ve seen a downturn just because of the Lower 48 economy,” says Roger Hickel of Anchorage-based Roger Hickel Contracting, Inc. He is also chairman of the Construction Industry Progress Fund (CIPF), a sister organization to the Associated General Contractors of Alaska (AGC), a nonprofit construction association for commercial and industrial contractors.

“In the public sector, I think we are doing very well in the state of Alaska.

We’ve had a lot of public projects that have been approved in years past,” he says. This includes approval of another several-million-dollar swath of bonds and deferred maintenance. “It’s going to take a while for those projects to turn into a start of construction. So we see those carrying over and affecting 2012,” Hickel says. “We’ll have a good construction economy in the future that’s going to continue to be level and not have the ups and downs back in the 1980s.”

Continued Recession Fallout

True to form, Alaska’s economy continues to run somewhat separate from that of the Lower 48, watching from afar as states like Arizona and Nevada continue to bear the brunt of recessional effects. “It’s not that Alaska is delayed

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

in experiencing the recession, but (it is) just a whole different ball of wax,” says Goldsmith. “We are sort of on our own wavelength up here. Because of the strength of our economy through this recession, it’s a totally different story.”

For example, the state’s construction industry was initially protected by the period of “build-out” of pre-existing projects already under way in Alaska when the recession struck the nation.

However, that period of limited respite eventually ended, with average construction employment dropping by 6.4 percent in 2009, according to Alaska Department of Labor economists Kelsey Kost and Todd Mosher.

It was “more than a typical bump in the road,” according to their 10-year Industry Forecast published in the fall.

Alaska construction also suffered unique, secondary impacts of the recession when national companies pulled back on planned expansion into the 49th State in order to perform triage to their Lower 48 operations in crisis.

Hickel describes how many of his company’s national clients put their Alaska plans on hold because of Lower 48

priorities, and not because of any concern with the Alaska economy.

“We have a contract for now almost two and a half years with a national food distributor that has branches all over the country and in Alaska; and we’ve also had a contract with a big construction and mining equipment dealer,” Hickel says. “They have postponed their Alaska expansion projects, not because of the Alaska economy, but because they’ve had to conserve their capital and resources for all their other branches that are hurting. They would have liked to continue their expansion and new facilities in Alaska, but were unable to. That’s how the Lower 48 economy can affect Alaska, even though Alaska still has a good economy compared to the rest of the country.”

Many such companies have not cancelled their planned projects, simply postponed them – first in 2008, then again in 2009.

“Now? Well, right now they’re not even scheduled for 2011,” Hickel says.

“Things still haven’t turned around enough to continue to expand and grow in Alaska like they would like to.”

2010 Predictions Prove Accurate

Construction-level predictions for 2010 by economic forecasters essentially hit the mark, according to Hickel and John MacKinnon, AGC of Alaska executive director. Construction spending in the state for 2010 was expected to come in at around $7 billion, down 3 percent from 2009, according to “Alaska’s Construction Spending: 2010 Forecast,” the annual report of the CIPF and AGC of Alaska. Produced for the organizations by UAA’s Goldsmith and Mary Killorin of the Institute of Social and Economic Research, the report also indicated that construction-related wage and salary employment would continue its several-year decline; that privatesector construction would be down 1 percent to $4.4 billion; and that public construction would decrease 5 percent in 2010 to $2.6 billion.

The report acknowledged several areas of uncertainty: lack of clear indications in early 2010 regarding the expected duration of the national recession and strength of any recovery; related impacts to Alaskan economic

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sectors like tourism, which are strongly influenced by Lower 48 spending; and permitting delays to large Alaska projects due to expected litigation and political forces.

In many cases, such uncertainty came to fruition, posing the delays described by Hickel and others.

Vertical versus Horizontal

MacKinnon prefers to analyze the industry’s past and current health by delineating what he terms “vertical” projects (buildings) and “horizontal” projects (road work).

On the “vertical” or building side of the industry, “private spending has declined over the past couple years. Just based on the metric of carpenter hours, it’s down more than 15 percent in 2010 over 2009. But that is a statewide figure, some areas have been up,” he says.

Carpenter hours provide a good measure of the health of the building side of the industry, while equipment operator hours offer metrics for measuring road building and dirt work.

“Horizontal work is good,” he says.

Given the stimulus-related spending, “it’s a good time to be a dirt contractor in Alaska. We still have a good piece of the FY10 federal program to go to bid, the $315 million transportation bond issue approved by voters in 2008 is hitting the street now. That should be a boost to things.”

For 2011, “again, it looks like another good year on the horizontal side. But the building side, we might experience a little bit of rebound this year,” according to MacKinnon. “We had a couple of good building appropriations in the budget last year with the Legislature.

Those projects are going to start hitting the street now.” With the State’s deferred maintenance and education bond projects rolling out, “I think 2011 we’re going to see an uptick in the building construction,” MacKinnon says.

Oil & Gas in Cautious Stance

Historically, oil and gas has constituted a predominant percentage of construction spending in Alaska. Last year, forecasters predicted approximately the same spending as in 2009. The reality of total 2010 oil and gas construction spending is yet unknown, but industry watchers report some level of uncer-

48

tainty for 2011 within the sector – due to residual impacts from the Gulf of Mexico spill and other concerns.

“There is uncertainty because of regulatory issues, legal issues, political issues, particularly what’s happened with the Gulf spill and what that means,” Goldsmith says. “Also in terms of tax issues. The State is talking about some revisions to ACES this year. There is a lot more uncertainty than most times in the past.”

MacKinnon mirrors the concern and acknowledges the key role the oil and gas industry plays in Alaska’s annual construction spending.

“Oil and gas has helped us keep a flat spending economy,” MacKinnon says. “I don’t know what is going to happen. That’s $3 billion out of our $7 billion (total construction spending) piece – that’s a sizable chunk. The companies are going want to maximize

of Baby Boomer attrition years ago and actively instigated training and recruitment efforts to attract new, young workers to the industry’s trade crafts.

“I think through CIPF and AGC and other associations like ours, that over the last five years, we’ve all done a really good job of recognizing the Baby Boomers are retiring and we need to replace that work force,” Hickel says. “Our education system is doing a better job than most in training our future construction industry work force. That is just because we made a concerted effort to work in partnership with school districts.”

Beyond 2011

Late in 2010, Governor Sean Parnell unveiled his 2012 proposed capital budget totaling $1.6 billion, to include $644.9 million in State general funds.

The construction industry stands

The remodel of a prominent Ketchikan building at the corner of Front and Dock streets, longtime home of Downtown Drugstore, is typical of winter construction projects continuing into 2011 in Alaska

their investment in the North Slope.

I hope that means they will continue their investment. I think it’s up to the State to see what they can do to help that happen.”

Baby Bubble

Beyond recession-related impacts, the Alaska construction industry also is feeling the result of an aging work force. Organizations like AGC and CIPF spotted the impending bubble

poised to benefit from the budget’s self-proclaimed “aggressive roads-toresources” and “comprehensive energy build out” focus.

The budget includes $65.7 million for the Alaska Energy Authority (AEA) to conduct planning, design and permitting for the Susitna Hydroelectric Project, which is estimated to meet half of the Railbelt’s electricity demand.

The budget also proposes to fund additional work on a road connecting

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

Workers take advantage of Ketchikan’s winter sunshine to make repairs.

the Dalton Highway to Umiat and on a road to the Ambler Mining District.

“We’ve included $103 million in the capital budget to leverage more than $705 million in federal and other funds for transportation, highways, aviation, water and sewer projects for vital infrastructure improvements,” Parnell said.

“We have targeted $60 million for roads and ports that are key to opening up resource development.”

The proposed capital budget also reflects continued focus on natural gas development, including $160 million for the Alaska Pipeline Project and $5.5 million for development of the instate gas line project. Beyond the series of existing deferred-maintenance projects that are now hitting the construction phase, the proposed budget includes $100 million for the second year of the five-year deferred maintenance plan.

While such rolling waves of projects create stability and help smooth out bumps created by external industry factors (i.e., the national recession, Gulf spill, and the like) some complexity is created in attempting to determine the exact “on the street” value of construction spending by calendar year, according to MacKinnon and others.

For example, the in-the-trenches impact of projects funded in one year may not be realized by the construction labor force until one or two years later. q www.akbizmag.com • Alaska Business Monthly • February 2011

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BUILDING ALASKA

SENCO Alaska Solution-based fastener company

Photo by Jackie Glatt/Courtesy of SENCO Alaska

By Gail West

SENCO Alaska recently introduced its MagnumT Heated System and acquired this brightly colored trailer to make transportation and application of the foam easier.

T

he invention of the pneumatic nail gun was the spark that sent Jack and Barbara Butt into the fastener supply business, and they opened the doors to SENCO Alaska Inc. in 1968. Jack, who had been a general contractor building homes in Anchorage, replaced his manual hammer with a pneumatic nailer one day and liked the results. The pneumatic nail gun is speedier and much more precise than the old-fashioned hammer, and it makes a homebuilder or

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a contractor much more productive.

According to Mark Symonds, salesman for SENCO Alaska, SENCO introduced the first nail gun to Alaska, and the Butts bought the statewide distributorship for SENCO products. At the time, the Butts had six daughters, and two, Teri and Jackie, joined their parents in running the business then bought it. The two have owned the business for the last eight years.

“They’ve worked at the company since the start, and that’s been nearly

43 years ago,” Symonds said. “They swept floors, answered phones, did inventory – just about everything.”

Today, Teri Gunter is vice president of SENCO Alaska and her sister, Jackie Glatt, is office manager.

With nine locations that distribute SENCO products around Alaska – Anchorage, Juneau, Fairbanks, Soldotna, Kodiak, Bethel, Wasilla, Seward and Nome – SENCO Alaska currently has six employees.

“All the employees and customers are treated like family,” Symonds said.

SENCO Alaska carries a full line of pneumatic nailers and staplers, as well as an extensive line of nails, staples and screws to meet constructionindustry needs. The company also carries Jenny/SENCO compressors, MAX re-bar tiers and DURASPIN screw guns and a full line of accessories – and they rent all their tools as well as selling them. Folks with “honey-do” lists can find all the tools and fasteners they need at SENCO, too.

Symonds said SENCO Alaska is known for having what a customer needs in stock.

“Teri and Jackie always say: ‘You can’t sell from an empty wheelbarrow,’” he added.

A new product for SENCO Alaska is its Magnum Heated System, which keeps polyurethane foam at a consistent temperature during application.

This foam is used for both commercial and residential construction, and SENCO Alaska has recently purchased a trailer that can travel from worksite to worksite.

“Our foam systems have been shipped from Southeast to Dutch Harbor to the North Slope and everywhere

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

in between,” Symonds said. In fact, he added, he traveled to rural Alaska during construction of the new, five-story hotel in Kotzebue and Kotzebue’s elder-care housing to provide education on the foam and how to use it.

Not only does the foam save energy costs,” Symonds said, but it doesn’t have all the harmful properties of the older foam. It’s safer, it’s fire-retardant, and it’s a perfect fit for the Alaska doit-yourselfer wanting to tighten up the home or the cabin.

“With heating oil at $8 a gallon in the Bush, this new foam can save homeowners a lot of money. And it makes you feel good when someone comes back after using the foam and says: ‘Hey, it worked. It’s not drafty anymore.’”

SENCO Alaska recently saved SKW Eskimos (Inc.) tens of thousands of dollars on one project alone, according to Symonds, because of the portability and cost of ownership and transportation to remote projects of the Magnum system. Another sizable, and regular, customer of SENCO Alaska’s is Osborne Construction Co., according to Gunter.

With customers ranging from the single homeowner to general contractors, home builders and the United States government and military, SENCO Alaska tries to meet the needs across the spectrum. There are times when that can be a daunting task.

“We provided underwater nailers for a job on the Aleutian Chain last year,” Symonds said. “We had a customer from Washington state with a contract to shore up a dock – they needed a nailer divers could use to drive the spikes under water. We provided that nailer.”

Closer to home and, arguably more fun, was the commission SENCO Alaska got this past year to supply fasteners for the sets of the movie “Everybody Loves Whales.”

“They used local craftsmen, union carpenters and local materials to build the sets,” Symonds said.

One of SENCO Alaska’s biggest challenges, according to Symonds, is staying atop the changing rules, regulations and codes of the industry.

“There are so many advances in commercial building, in the fastener business,” said Symonds, “and it’s

the main core of what we do. Staying abreast of the changes required for LEED certification, too, requires a good deal of continuing education.”

To help SENCO Alaska stay current on industry standards and on the foam insulation they’ve recently added to their list of products, the company regularly sends employees to national industry trade shows and seminars.

“That helps us stay proactive rather than reactive,” Symonds said. “That’s why we’re known as a solutionbased company.”

In addition to the continuing education program on products, Symonds said SENCO Alaska also conducts seminars and workshops on weatherization at their Dowling Street location in Anchorage.

“Air sealing, such as with the foam, has been going on for 12 years,” he said, “and we’ve trained many of Anchorage’s top energy-assistance folks. We have the only urethane foam machine for rent to homeowners and contractors in Alaska, and we back up what we offer with both education and service.”

To help market their products as well as to stay abreast of industry developments, Teri Gunter is active in both the Associated General Contractors of Alaska and the Alaska Homebuilders Association. In 2009, Gunter was selected as AGC’s volunteer of the year and in November’s annual meeting, she was elected to the 2010-2011 board of directors for AGC. “We’ve been a member of AGC for 35 years,” Symonds said.

Gunter and Glatt have spent their last year accomplishing another goal – gaining certification as a woman-owned business.

“We learned about this certification at a military seminar,” Symonds said, “and, of course, we have been womanowned for the past eight years. We just needed the official certification, so Teri and Jackie have worked through all the details with the assistance of the Procurement Technical Assistance Center.

Now, we’re certified.”

With eyes toward the future, SENCO Alaska has positioned itself well to take on both government and private contracts, and stands ready to provide materials, service and education to all its customers. q

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

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BUILDING ALASKA

Contract Surety Bonds: Vital to Alaska’s Construction Industry Making sure project owners are safe

By Tracy Barbour

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Courtesy of John Scott, DOT&PF

I

n Alaska and other parts of the country, contract surety bonds are an integral part of the construction business for contractors as well as project owners. A surety bond is a written agreement in which one party, the surety (usually an insurance company), obligates itself to a second party, the obligee, to answer for the default of a third party, the principal.

Contract surety bonds provide financial security and construction assurance on building and construction projects by assuring the project owner (the obligee) that the contractor (the principal) is qualified to perform the work and will pay subcontractors, laborers and material suppliers. In essence, a bond protects the project owner against losses resulting from the contractor’s failure to meet a certain obligation.

Like an insurance policy, surety bonds are a means of transferring risk and providing for the event of a financial loss. But that’s where the similarity ends. Unlike a traditional insurance policy, surety bonds agreements are between at least three parties. And surety bonds don’t protect the person purchasing the coverage. Instead, they provide coverage for someone else: the project owner.

Surety bonds are a financial instrument, not a traditional insurance product, says Linda Hall, director of the Alaska Division of Insurance.

She explains: “In a typical insurance product – a homeowners’ policy, for example – when a claim occurs and is paid, there is no recourse for the homeowner to repay the insurance company. The collective premiums paid by the policyholders of the company are used to pay the claims that take

The Gustavus Causeway and Dock Replacement construction project was completed in August 2010. The Alaska Department of Transportation and Public Facilities was responsible for managing the project from start to finish, including design, engineering and environmental permitting. Construction was done by a contractor and subcontractors. The $7.7 million project was funded by the American Recovery and Reinvestment Act of 2009.

place. When a surety bond is secured for a specific purpose, the principal on the bond also becomes an indemnitor in the case of the default of the principal or contractor. The principal on the bond would be obligated to reimburse the insurance company for any losses they are required to pay in the case of the default.”

In Alaska, contract surety bonds are normally required on most public construction projects, as well as larger private projects, according to Hall. However, she says: “Bonds are not required in all cases. Generally, the requirement depends on the work, the size and scope of the project, possibly the qualifications of the contractor for the type of project being bid, the

time period it is estimated to take to completion (multi-year projects), the financial status of the contractor and other considerations.”

Bonding Serves a Unique Purpose

There are a variety of surety bonds available to cover different situations.

The most common types of bonds being used in Alaska’s construction industry are bid, performance and payment bonds, according to Christopher S. Pobieglo, president of Anchoragebased Business Insurance Associates.

Bid bonds provide financial assurance a bid has been submitted in good faith.

They ensure the contractor intends to enter into the contract at the price bid

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and provide the required performance and payment bonds.

Performance bonds, as the name indicates, protects the owner from financial loss should the contractor fail to perform the contract according to the terms and conditions. Payment bonds guarantee the contractor will pay certain subcontractors, laborers and material suppliers associated with the project.

Regardless of their type, surety bonds have one thing in common: They help protect the owner from fraudulent, unethical or inappropriate business practices.

Contract surety bonds serve a unique purpose in the construction business.

In a private commercial setting, the project owner can place a lien on property if the contractual obligations aren’t met. But this isn’t feasible with public projects. “You can’t have people (suppliers) placing liens on public projects,” Pobieglo says.

Mark O’Brien, chief contracts officer of Alaska Department of Transportation and Public Facilities (DOT &PF), says surety bonds can be critical.

He explains: “If a contractor was not performing as required or in default of their contract, the surety would step in and guarantee timely completion of the project. The surety is our insurance policy, should difficulties arise with the performance of our contractor.”

The Alaska DOT & PF generally requires bonds for construction projects with contract amounts exceeding $100,000. If the amount of the contract is more than $100,000, the department typically requires a bid, performance and payment bond. “The only bond that is optional is the bid bond,” O’Brien says. “Since the sureties usually provide bid bonds at no additional cost to the contractor, we generally require them. Bid bonds help prevent frivolous bids and guarantee that the contractor will honor their bid.”

Surety bonds represent a practical and consistent element in the contracting process. Since it would be difficult to come up with objective criteria that allowing bonds to be waived for proven contractors, it’s necessary to require bonds across the board, O’Brien says.

“Requiring bonds from all contractors

provides a level playing field in a competitive bidding environment,” he adds.

Bonds also provide an extra layer of assurance and comfort for Alaska DOT & PF projects. “They help protect the public funds allocated to these projects by requiring all public owners to do business with companies (preapproved by the sureties) that have sufficient assets and a proven track record,” O’Brien says.

There have been several occasions where contractors have failed to perform under one of the department’s construction contracts, O’Brien says.

In these instances, the surety has had to step in and assume part or all of one of the construction contracts.

Part of Doing Business

Surety bonds are a necessary component of Alaska’s construction industry, says Chris Hubble, operations manager of Pacific Asphalt Products.

The company provided a $1.1 million subcontract bond for a striping job it completed on the Glenn Highway this past summer. “It’s part of doing business,” Hubble says. “If you can’t

Risk ManageMent WoRks. Ask a turtle.

Independent CommerCIal InsuranCe & surety Brokerage. www.businessinsuranceassociates.com • 274-4142 www.akbizmag.com • Alaska Business Monthly • February 2011

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get a bond, you don’t get the work.”

Pacific Asphalt Products typically works as a subcontractor on construction projects for the State and federal government. When performing work as a sub, the company is required to provide a bond about 50 percent of the time. “I think they’re a good thing,” Hubble says. “It’s basically a prequalification to the owner and weeds out folks who may not be able to perform the work.”

Formerly known as Pacific Asphalt Inc., Pacific Asphalt Products has been doing highway and airport work in Alaska and elsewhere for nearly two decades. The company is increasingly required to provide contract surety bonds for projects. “The general contractor will have us provide a subcontract bond to them, which is a way for them to mitigate their risk and protect themselves if we do not perform,” Hubble says.

“Sub-bonds used to be rare, but now they are pretty routine.”

Pobieglo agrees. He says most general contractors have a subcontractor bonding policy nowadays. The reason: Subcontractors tend to have a higher

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chance of failing on projects. Furthermore, requiring contractual provisions for subcontractors places the responsibility on the party with the greatest ability to control their specific aspect of the project. “The general contractors are protecting themselves, and their bonding company may be requiring it,” he says. “It lowers the risk to the prime contractor’s surety, and they may be willing to insure them for a bigger job.”

Detailed Underwriting Process

With surety bonds, the contractor pays a premium (usually annually) in exchange for the bonding company’s financial strength to extend surety credit. In Alaska, nearly $25 million in surety bond premiums were written in 2008, according to figures from the Alaska Division of Insurance.

Surety bond costs vary according to the industry, the company supplying the bond, and also on the financial strength of the contractor being bonded. Typical bond rates in Alaska range from 3 percent for small contractors to 1 percent or even less for larger, more established companies, accord-

ing to Pobieglo. The bond premium is nothing more than a pass-through payment that is built into the bid. “The bond premium can affect the competitive bid if you have a contractor with a 3 percent premium against a contractor with a half of a percent,” he says. “Having a lower bond rate can give you a competitive edge.”

Well-established companies with proven track records for the type of work involved and with adequate financial resources have an easier time obtaining a bond. However, the bonding process can be quite involved, according to Hall. “This process can be time-consuming and detailed, but once the contractor is qualified, a bid and performance bond can be issued quite quickly in response to an RFP,” she says. “A contractor who waits until a bond is needed to make an application to a bond company is not likely to be successful, since the underwriting process takes considerable time and paperwork.”

The underwriting process for surety bonds requires a tremendous amount of transparency and documentation,

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

according to Pobieglo, whose suretybrokerage firm deals with about a dozen surety companies. “It can take a week or even a month to put together a package for surety,” he says. “We ask for financial statements, resumes on key personnel, prior project histories, business plans and even business-continuity plans. The more we know about your company, the better we can help you.”

Surety companies may stipulate specific requests like requiring company owners to have a will in place or not allowing owners to fly together.

However, the bonding requirements are progressive. “In most cases, it’s an evolving process with the contractors starting out small,” Pobieglo explains. “Once they start contracting more than a half million dollars, that’s when the surety companies want to see more information.”

When delving into a contractor’s financial records, the surety company often pulls personal credit reports to check for bankruptcies, lawsuits and the status of tax payments. “If someone’s credit has taken a hit, it can be difficult to get them bonded,” Pobieglo says.

However, contractors may be able to use creative solutions to work around the situation. For instance, they could apply for the U.S. Small Business Administration’s surety program, which would back a significant percentage of the bond. Similarly, they could get a co-signer to act as an outside indemnitor who assumes financial responsibility if a loss occurs. If they have poor credit and not a lot of cash, they could also use real estate as collateral to get the bond.

Those who have cash could deposit some money in the bank, put up a letter of credit and create a joint escrow account with the surety to ensure suppliers and vendors get paid.

Bond Defaults Greater at Lower Levels

The Alaska Division of Insurance doesn’t track defaults on bonds, but Hall says there were substantial bond defaults in the mid-80s. “In a down turning economy, the contractor may not have adequate financial resources to complete the project and thus defaults on the bond,” she says.

Today, bond defaults are not common in Alaska. Eighty-five percent of all claims that do happen are on the payment bond, not the performance bond, Pobieglo says. Contractors who default on the payment bond may do so because they under-bid the project or developed cash flow problems due to the economy. “You typically see that at the lower level with the smaller contractor who is trying to grow,” Pobieglo says. “A lot of the time, the smaller contractor does not have the resources or knowledge to step into bigger projects.”

Other key reasons for contractor failure are unrealistic growth, character issues, accounting issues and management issues, according to the Surety Information Office.

Surety companies are often willing to get involved with larger projects in an attempt to circumvent claims, Pobieglo says. They might bring in subcontractors or even guarantee a bank loan to help project management get the situation back on track. “The key is for contractors to communicate on the front end to let the surety company know they are having problems,” he says. q

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

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BUILDING ALASKA

Mack Trucks Inc. Comes to Alaska CMI expands full-service dealership

Photo courtesy of CMI LLC

By Kent L. Colby

With its 16-liter, 605 hp MACK® MP10 engine, the powerful Titan by Mack™ is specifically designed for the heavy transport and construction jobs performed by many CMI customers.

Mack Granite series truck on road construction project, Eagle River, Alaska.

Photo courtesy of Mack Trucks Inc.

F

or the past four months, Construction Machinery Industrial LLC (CMI)’s Greg Morrison and other representatives have been traveling the state in preparation of this month’s rollout of the firm expanding its business by becoming a Mack Trucks Inc. full-service dealer. CMI was founded in 1985 and holds a 43 percent market share in its segment as a Volvo

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construction equipment dealer. With locations in Anchorage, Fairbanks, Juneau and Ketchikan, CMI has sales and service business of $88 million.

The company adds the complete line of Mack product to its existing Hitachi, Atlas Copco, Volvo and Ingersoll Rand lines of construction machinery.

“CMI has had great success as a Volvo construction equipment dealer

and really knows the vocational market,” says John Thomas, Mack west region vice president. “Expanding to add the Mack product line is a natural fit for them and for us. CMI’s customer support and Mack equipment will be a powerful combination in the Alaska market.”

Morrison, with more than 20 years of Alaska automotive and equipment

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experience, joined CMI in 2010 as the Mack Truck sales and product representative. His objective has been to visit all current Mack users in the state – there are 456 trucks in state – and to familiarize them with CMI’s business strategy and the company’s team of experts that consistently deliver leadingedge customer satisfaction. Morrison says he has been focusing on complete product support and development, repair needs and introducing the full line of Mack Trucks.

‘Built Like a Mack Truck’

Mack reports it holds itself to high standards and practices and is proud of the phrase “Built Like a Mack Truck,” which has become ubiquitous in signifying strength and durability.

M a c k Tr u c k s h a s p r o v i d e d customers with innovative transportation solutions for more than a century. Now, with a partnership with CMI, Mack is backed by the highquality standards that company is known for, and the complete Mack product line will be available to customers in the state.

Initial emphasis for CMI will be on the vocational line of Macks. Primarily the Mack Granite and the TerraPro Cabover. The Granite is a Mack truck built to tackle rock quarries, rugged job sites and rough roads – another way of saying that it is built for Alaska.

This truck line features the stronger chassis, a reinforced cab, smarter electronics, ergonomic dash and plush interior trim package. The TerraPro Cabover is a best-selling refuse truck and is ideally suited for concrete pumper or telescopic belt conveyor applications.

To satisfy the heavy transport market, CMI will also carry the Titan, ideal for logging; oil field; heavy equipment; and severe, heavy-haul applications.

“Representing Mack will allow us to expand and strengthen our brand and market share in Alaska,” says Ken Gerondale, president of CMI. “Our customers know the Mack name and will gladly consider the Mack product when it’s time to make a new purchase. I also know current Mack owners are very excited to have a local dealer that can help them with parts and service support.” q

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

57

Right Moves

Compiled By Nancy Pounds

a new product. Carlin “Buckwheat” Donahue of Skagway received the Denali Award for his contribuThe Alaska SeaLife Center elected new board tions to the Alaska travel industry. John Quinley of members. They are Todd Allen, Koniag Inc., the National Park Service Alaska Region accepted chairman; Stephen Grabacki, GRAYSTAR Pacific a special recognition award for his efforts proSeafood Ltd., vice chairman; Willard Dunham, moting and marketing Alaska. David Kasser of the mayor of the City of Seward, secretary; and Tom Anchorage Convention & Visitors Bureau garnered Tougas, Alaska Coach Tours, treasurer. New board the Spirit of Alaska Award for work supporting a members are: Maggie Kelly, Royal Celebrity Tours; community, charity or other organization outside William Muldoon, ConocoPhillips Alaska Inc.; the travel industry.

Dona Eidam, University of Alaska; Lela Klingert, Alaska Commercial Fisheries & Agriculture Bank; Solstice Advertising Jason Brune, Resource Development Council; and Julie Bonney, Alaska Groundfish Data Bank. Elizabeth O’Toole was hired as accounting tech and receptionist ASRC Energy Services at Solstice Advertising.

O’Toole earned a bachSara Kasper was elor’s degree in business appointed associate management from general counsel at ASRC Charter College and Energy Services. Kasper has worked as a Level previously was an assoO’Toole 3 certified tax advisor for ciate at WilmerHale in H&R Block.

Washington, D.C., where she handled congressional investigations, Associated Builders and regulatory compliance Kasper Contractors of Alaska and enforcement matters, and government-contract Suzanne Armstrong was hired as chapter president issues. for Associated Builders and Contractors of Alaska.

Frank Weiss was chosen vice president and She most recently served as campaign manager general manager of engineering at ASRC Energy for Ralph Samuels’ gubernatorial campaign and Services. He most recently served as president and director of marketing and public affairs for the Port general manager of Alaska Anvil Inc. of Anchorage.

Alaska SeaLife Center

Alaska Travel Industry Association

Anchorage Convention & Visitors Bureau

The Alaska Travel Industry Association presented several awards at its 2010 annual convention last fall in Whitehourse, Yukon Territory. The Alaska Cruise Association and the Alaska Alliance for Cruise Travel received the Alyeska Award honoring professional excellence in government relations. The Bering Sea Crab Fisherman’s Tour of Ketchikan garnered the Chuck West Award, honoring a new business, which successfully launched

Chrissy Johnson joined the Anchorage Convention & Visitors Bureau as convention sales and service assistant. Johnson has eight years of sales experience. Zulie Mason was hired as a membership and advertising sales manager. She previously worked at ACVB in 1998 then chose to spend time raising her young daughters and run a small business.

Susan Sommer joined ACVB as film/special projects manager. Sommer previously worked as an

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editor and Web master. Nedra Anderson was chosen human resources manager. Anderson has more than 18 years of experience as a human resources professional, with a degree in organizational management and a Professional Human Resources certification.

Providence Alaska Foundation Suzanne Rudolph was appointed president of Providence Alaska Foundation. Rudolph joined Providence in 2001. She has served as development officer, director of operations and, most recently, vice president of the foundation.

Ashburn & Mason P.C.

Matthews

Windt

Mera Matthews joined Ashburn & Mason P.C. in civil litigation practice.

She recently worked three years as a trial attorney for the Office of Public Advocacy Criminal Section.

Rebecca Windt also joined the firm to work with real estate, land use and regulatory issues. She most recently served as a clerk with Justice Morgan Christen of the Alaska Supreme Court.

Alaska Native Tribal Health Consortium A. Stewart Ferguson was hired as chief information officer at the Alaska Native Tribal Health Consortium. He has more than 20 years of computer and research experience academic, industrial, biomedical and business sectors. He was owner/ partner of two consulting firms specializing in custom

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

Right Moves

Sponsored by Northern Air Cargo

software development, database design and integrated network installation.

U.S. Sen. Mark Begich’s Office

RIM Architects

Rachel Barinbaum was hired as communications director for U.S. Sen. Mark Begich.. Barinbaum is based in Washington, D.C. She worked for Sen. Begich’s campaign in 2008.

.

Bering Straits Native Corp.

Thompson Klug J. Michael Thompson and Bryce Klug were appointed senior associates at RIM Architects.

Thompson has 35 years of architectural experience, including 29 years in Alaska. He currently manages RIM Architects Quality Assurance and Quality Control Program. Klug has 25 years of architectural experience. He specializes in leadership in energy and environmental design (LEED) sustainable building practices.

Gail Schubert was promoted to president at Bering Straits Native Corp. She has served as chief executive since 2009. She joined the company in 2003 as executive vice president and general counsel.

NANA Management Services LLC

Pacific Northern Academy Arnold Cohen was chosen Pacific Northern Academy’s head of school. Cohen previously served as head of school at the Lamplighter School in Dallas and the Green Acres School in Rockville, Md. He begins his new role July 1.

U.S. Army Corps of Engineers, Alaska District

Morgan

Kevin Morgan was appointed regulatory division chief for U.S. Army Corps of Engineers Alaska District. He most recently served as chief of the evaluation section of the Corps’ Galveston District in Texas. He has served the Alaska District for 17 years, starting in 1990.

Cox

Beverly Cox was hired as vice president of human resources for NANA Management Services LLC. Cox has experience in the food service industry and has held senior human resources positions in graphic communications, marketing and technology services.

Governor Honors Alaskans The Governor’s Annual Awards for Emergency Medical Services honored several Alaskans. The Alaska Council on Emergency Medical Services presented the awards in November. Morgan Lockwood of Saint Michael received the Consumer/Citizen Award for quick thinking and bravely rescuing four children from a burning mobile home. Mike Moore of Seward received the emergency medical services provider award for 25 years with the Seward Volunteer Ambulance Corps. Patricia Vincent received the EMS educator award for her career and volunteer contributions to EMS education. Dr. Ray Andreassen of Delta Junction received the EMS administrator award, honoring 20 years of work

with the Delta Junction EMS area. Shayne Pond received the Melissa Ann Peters Memorial Award for his work as a registered nurse with Central Peninsula Hospital. Dr. Regina Chennault of Anchorage garnered the George H. Longenbaugh Memorial Award recognizing efforts to improve trauma care for all Alaskans. Alaska Professional Volunteers of Anchorage took home the outstanding ambulance service award for providing more than 14,000 volunteer hours for the year and providing emergency medical service coverage at events in Anchorage and elsewhere in Southcentral Alaska. Sen. John Coghill, R-North Pole, was honored with a special commendation for his work supporting the Alaska trauma system. Steven O’Connor of Kenai/Soldotna was honored posthumously for his contributions to the Alaska EMS System.

State Government Michael Hanley was appointed commissioner of the State Department of Education and Early Development. He most recently served as principal of Kincaid Elementary in Anchorage, a post he held since 2005. Hanley has worked as a teacher with the Anchorage School District since 1991.

Duane Mayes was chosen director of the State Division of Senior and Disabilities Services. Mayes most recently worked as a health and social services planner for the Governor’s Council on Disabilities and Special Education, which works closely with the division.

Gov. Sean Parnell, starting his new term as governor, chose to retain Mike Nizich as chief of staff.

He first worked for the Office of the Governor in 1976 and has served eight Alaska governors.

John Katz will continue to serve as director of State and federal relations and special counsel to the governor in Washington, D.C. Katz first served as special counsel to Gov. Jay Hammond in 1979.

He also has worked for eight Alaska governors.

Parnell also chose to retain Randy Ruaro, deputy chief of staff; Cindy Sims, deputy chief of staff for the Office of the Governor operations and international trade director; Karen Rehfeld, Office of Management and Budget director; Heather Brakes, legislative director; and John Moller, senior advisor q for rural affairs.

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

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MINING

Alaska Mining Ramps Up for 2011 Access, power and pay dirt influence success

By Dimitra Lavrakas

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n Alaska, the one thing that can make a mine profitable or not is access – for some mines that’s not a problem and it’s historic. Other mines face uncertain economic feasibility, but for the blessed few with infrastructure, roads, power and plenty of pay dirt – the future is bright.

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Photo courtesy of International Tower Hill Mines Ltd./Corvus Gold Inc.

Livengood

While Livengood is the family name of the district’s discoverer Jay Livengood, it does conjure letters written circa 1914 from a miner’s cabin: “Dearest Mother, I am alive and good.”

Once called “Alaska’s Last Stampede,” Livengood has been resurrected in the 21st century.

“It was fantastic, we’re drilling some of the best grade,” said Quentin Mai, in describing some of the 2010 drill results. Mai is vice president of corporate communications for International Tower Hill, a Vancouver, British Columbia-based company and 100 percent owner of the Livengood Gold Project. Looking to continued drilling this month, Mai is optimistic.

“We will be drilling in the Southwest Zone and seeking to further expand the deposit,” Mai said.

Accessed by paved road 70 miles north of Fairbanks, the successful 2010 summer saw field investigations continue with seven drilling rigs on site. The work focused on drilling one hole in the center of four existing holes, called a five-spot, to reduce the drill spacing from 75 meters to 50 meters.

An aerial view of International Tower Hill Mines’ Livengood project.

“The five-spot improves our confidence in the gold resource,” said Mai. Livengood sits pretty on the Tintina

Gold Belt, a band of mineralization that stretches from Interior Alaska to the historic and still prolific Klondike

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goldfields in Canada’s Yukon Territory and also wherein lies Fort Knox Mine and the Pogo Mine near Delta Junction.

Photo courtesy Fire River Gold Corp.

Lucky Shot

Just 90 miles north of Anchorage in the Willow Creek Mining District, with good road and rail access, with a solid infrastructure and power, Lucky Shot could be sitting pretty. Or not.

In late November, Harmony Gold Corp. of Vancouver sold its interest to Full Metal Minerals, also in Vancouver.

“Basically we had optioned it out to Harmony Gold and they gave it back to us a month ago,” said Rob McLeod, vice president of exploration for Full Metal Minerals, in early December.

McLeod said the company has no plans for the property or any information on if or when it will.

Over the past several years, Full Metal has explored three other prospects in the state: the Pyramid project on the Alaska Peninsula in the Port Moller Region, Fortymile near Chicken and Lucky Shot. It also has claims to all of the surrounding lands to the Pebble Deposit and in September 2010, optioned

Nixon Fork is an underground gold mine accessible only by air in the Tintina Trench, about 32 miles northeast of McGrath.

them to the Pebble Partnership, a 50/50 partnership between Anglo American plc and Northern Dynasty wherein PLP can an earn a 60 percent interest in Full Metal’s Pebble South property.

Chuitna Coal Mine

Holding a 20,571-acre State lease on Alaska Mental Health Trust land approximately 45 miles west of Anchorage, Delaware-based PacRim LP hopes to mine

771 million tons of low-sulfur subbituminous coal from the Beluga Coal Field.

Right now, the company is buried in paperwork. ““We’ve signed a couple of land agreements over the last year,” said Dan Graham, Chuitna Coal project manager from his Anchorage office.

“Tyonek Native Corp. has given us an easement across their property for us to realign our facilities.”

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

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The Environmental Impact Statement process will begin again, Graham said.

“On Nov. 1, the U.S. Corps of Engineers is the agency for the EIS,” he said. “I expect the permitting process to take eight months to a year.”

According to a company fact sheet, PacRim expects to discharge more than 7.4 million gallons of mine runoff daily into salmon-bearing tributaries of the Chuitna River, eventually reaching Cook Inlet, making this project challenging in the permitting stage and environmentally controversial. Also two State wildlife refuges are near the project.

As Alaska only uses coal to fire 10 percent of its electricity needs – all of it provided by Usibelli Coal Mine in Healy – the coal would go to Asia, Mexico or Chile.

A road and a 12-mile conveyor belt to Cook Inlet would bring the coal to a port the company would develop at Ladd Landing on Kenai Peninsula Borough property.

Right now, Graham said, there’s really no infrastructure there, and the company rents space at the Cottonwood Camp, which utlility companies own.

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Nixon Fork

While it was closed in 1997 because of low gold prices, from 2004-2008 more than $50 million was expended on upgrades to the processing facilities and mine infrastructure – just in case. It was a wise move. In 2009, Vancouver-based Fire River Gold Corp. bought Nixon Fork and operates it under its subsidiary Mystery Creek Resources Inc. The mine is located almost 32 miles northeast of McGrath, 8 miles north of Medfra, also on the Tintina Trench.

“These first results from our surface drilling program are encouraging,” Richard Goodwin, Fire River’s vice president of mining, is quoted in a press release “They demonstrate the occurrence of high-grade mineralization outside of the Crystal and Mystery mines and affirm the possibility of extending operations by continuously replacing depleted mines with new ones through ongoing exploration.”

The company expects to begin surface drilling in the spring of 2011 to expand the zones identified in 2010. It also plans to empty the tailings pond from former operations and process those tailings to recover the gold with

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

a cyanidation plant, then detoxify, filter and dispose of the tailings in an existing dry stack constructed in 2007.

While only accessible by air, infrastructure includes a partially installed carbonin-leach (CIL) gold-leaching circuit, a fleet of vehicles, a self-contained power plant, maintenance facilities, an 85-person camp, offices and a landing strip.

“Essentially, we’re still doing exploration,” said Dave Marcellus, the company’s controller, adding the company expected to finish construction on the CIL plant last month, with possible production this year. The company is confident enough to have purchased a second underground diamond drill in order to accommodate four shifts of drilling daily.

Rock Creek and Big Hurrah

The very name Nome glitters with mining legend, but alas, not for NovaGold, the Vancouver-based precious minerals exploration and development company with three projects near Nome: Rock Creek, Big Hurrah and Nome Gold.

The company considers these properties no longer a part of its business

plan, particularly Rock Creek, said Rhylin Bailie, NovaGold’s director of communications and investor relations.

“We have actually decided to solicit offers to sell that resource and that process is underway,” Bailie said. “None of our projects in Nome are our core projects and we plan to sell Rock Creek.”

NovaGold holds title to patented mining claims covering approximately 15,700 acres, with additional lands leased from Bering Straits Native Corp., Sitnasuak Native Corp. and Solomon Native Corp., bringing NovaGold’s total property position to more than 75,400 acres.

Bailie said the company might entertain offers for its other nearby holdings – Big Hurrah, a sand-and-gravel business and other acreage.

Ambler

Now here, NovaGold is positively bullish.

“Ambler is an early stage project, but with excellent potential” Bailie said.

Since 1995, extensive exploration drilling defined a gold resource that held promise – indicated sources of 1.5 billion

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pounds of copper, 2.2 billion pounds of zinc, 450,000 ounces of gold, 32 million ounces of silver and 350 million pounds of lead, with additional inferred resources of 937 million pounds of copper, 1.3 billion pounds of zinc, 260,000 ounces of gold, 19 million ounces of silver and 210 million pounds of lead.

And obviously the bean counters agreed with the company putting up $1.5 million at Ambler in 2010, with $1.3 million spent by October and expenditures of $1.2 million during the 2010 third quarter.

The company will begin approaching the local community about the project in 2011.

It’s very high grade,” Bailie said.

“The exploration potential in the area is very large. It is the next generation project for NovaGold.”

Donlin Creek

Donlin Creek LLC, a 50/50 limitedliability company of Barrick Gold and NovaGold, is aiming to develop a gold mine 13 miles north of Crooked Creek on the Kuskokwim River.

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

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the mine will be a conventional truck and shovel, open-pit mine processing approximately 50,000 tons per day and yielding up to 1.5 million ounces of gold annually.

Originally envisioned to use diesel and wind cogeneration for power, instead it will use liquified natural gas to fuel its operation.

“We decided to go with a natural gas pipeline because natural gas has a much less environmental footprint than diesel,” said Bailie. “Power is 25 percent of our total operating cost. There is also the potential for local communities to

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tap into the gas line that would lessen their reliance on diesel.”

No agreements have been signed for the LNG shipments and Bailie would not say who they are in discussion with.

The Kuskokwim Corp., a consortium of 10 upriver villages closest to Donlin, owns most of the surface land in the proposed mine area, while Calista Corp. owns the subsurface land.

“We’ll file permits at the end of 2011,” Bailie said. “It’ll take two to three years to permit, and we envision 2017 or 2018 it would go into production of

1 million ounces per year,” she said.

A new airstrip and on-site housing would be built, along with a port on the Kuskokwim River for access and shipment.

With a nod to Nome’s history and Alaskans’ love of sled dog racing, Donlin Creek LLC contributed $285,000 to the 2011 Iditarod Trail Sled Dog Race.

Pebble Partnership

Other problems mines face here aside from access are a lack of power and their location near renewable resources, such as fishing, which also contributes to Alaska’s economy and communities. And location can lead to litigation, which is exactly what happened to the Pebble Partnership on Dec. 6 in federal court in Anchorage.

The Pebble Partnership, an equal partnership between global mining giant Anglo-American plc of London, England, and Northern Dynasty Minerals Ltd. of Canada.

The mine is located across Cook Inlet from Anchorage and near the town of Iliamna, which sits close to Bristol Bay. It is estimated to hold 80.6 billion pounds of copper, 5.6 billion pounds of molybdenum, 107.4 million ounces of gold, and commercially significant amounts of silver, rhenium and palladium. The company says it could provide 1,000 high-skilled, highwage operating jobs for 25 to 35 years, 2,000 jobs during construction and pay millions of dollars in local and State taxes.

Nunamta Aulukestai, a coalition of eight Bristol Bay Native village corporations, contends the State-issued exploratory permits violate the Alaska Constitution by not developing the resource for the maximum benefit of the people under its sustained yield principle and that there was no public notification or findings on potential impacts to natural resources, particularly subsistence fish and game.

How the case plays out and whether the Partnership can overcome the challenge of no roads, no power and some pretty substantial opposition, for instance the Bristol Bay Native Corp. board’s vote against the mine in 2009, rivets the attention of everyone in the state.

Whatever the decision, it will have a substantial ripple effect across the industry. q

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

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Wolk & Associates R&M Consultants, Inc. Improving the Quality of Life for Alaskans

W

ith more than 41 years of providing professional services in Alaska, R&M Consultants, Inc. improves the quality of Alaska’s future by participating in the responsible development of critical infrastructure. Established in 1969, R&M has offices in Anchorage and Fairbanks.

“We are very proud to be wholly committed to Alaska,“ says COO Len Story, who has been with R&M since 1979.

“With 100 percent of our operations located in Alaska, R&M is the largest entirely Alaska-based engineering firm.

All of our employees are Alaska residents; this is where we live and play and where we want to do business.”

R&M is a leading provider of civil and structural engineering, surveying and mapping, geology, environmental services, construction administration, materials testing, and special inspection. R&M provides nearly every service in the project development process except the actual construction. “We collect technical data and use it to plan, design and supervise the construction of facilities that are essential to modern life — roads, airports, water and sewer systems, schools, etc.,” Story says. “We’re experienced in implementing practical, cost-effective solutions to Alaska’s often very complex problems.

Ongoing notable projects include the new UAA Seawolves Sports Arena, Fairview Loop Road Rehabilitation, Allison Lake Hydroelectric project, Statewide Crime Lab, Alaska Gas Pipeline Project (geotechnical services), Eielson AFB Rail Line Upgrade (surveying and mapping), a statewide inventory of material sites for the Alaska Department of Transportation and Public Facilities, aeronautical surveys at more 20 airports throughout Alaska, and special inspection services for the Anchorage Sport Fish Hatchery.

R&M’s Nicole Knox, Tim Grier, Kevin Pendergast, and Lance DeBernardi looking at alternatives on the Fairview Loop Road Rehabilitation project.

R&M underwent a pivotal change in 2002, when ownership was transferred to a group of employee owners. The management team has since worked hard to respect the reputation and traditions R&M was built on, while simultaneously establishing a new identity to carry the firm into the future. “Our management team really emphasizes commitment to our clients, our employees and the communities in which we work,” Story says.

In recent years, R&M has grown significantly, going from a staff of 60 to currently having a well-balanced team of 95 professional, technical and other personnel. Story believes each employee plays an integral role in the firm’s success.

The company’s culture is designed to fit a variety of employee personalities, and provides a range of features to enhance employee satisfaction. The goal is to create a family-oriented, flexible environment that encourages employee growth, both on a personal and professional level.

Story says, “We understand people have lives outside work … you can’t deliver outstanding services without happy employees.” R&M was recently recognized for its commitment to employees with a No. 16 ranking in the CE News 201 Best P A I D

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

Civil Engineering Firms to Work For list.

R&M credits its success to having experienced personnel, an entrepreneurial spirit, and a collaborative, hands-on management team that closely monitors the progress of each project. These attributes led to R&M’s ranking at No. 141 (nationally) on The Zweig Letter 2010 Hot Firm List.

Future plans for the firm include expanding its Fairbanks office, remaining consistent with its core business lines. This will allow to firm to continue building its presence in Alaska. Story says, “R&M is a great company to work for and do business with.”

For more information contact: R&M Consultants, Inc. Andrea Story, CPSM, Marketing Director 9101 Vanguard Drive Anchorage, Alaska 99507 Phone: (907) 522-1707 Fax: (907) 522-3403 Website: www.rmconsult.com

S P E C I A L E N GINEERING SECTION

ENGINEERING SPECIAL SECTION

2010 Engineer of the Year Last year, Tom Krzewinski took top honors Compiled by Tom Krzewinski, P.E.

T

he competition for 2010 Alaska Engineer of the Year is under way with the winner to be announced in February as a part of National Engineers Week. There are seven candidates this year, each nominated by the professional societies they are active in. The following sections present biographical information for each candidate vying for the coveted award. This special section of Alaska Business Monthly was compiled by Tom Krzewinski, P.E., the 2009 Alaska Engineer of the Year and a principal with Golder Associates Inc. in Anchorage.

Gerry R. Brown, P.E. – Nominated by the Alaska Society of Professional Engineers (ASPE), Anchorage Chapter

Gerry R. Brown, P.E., earned both his bachelor’s and master’s degrees in civil engineering from the University of Idaho. Brown started his extensive Alaskan career in 1997 while finishing his master’s degree and started his own engineering company in 2006.

Brown has worked on a wide range of civil engineering projects but specializes in environmental, water and wastewater projects.

As the owner of G R Brown

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Engineering LLC, Brown manages office functions and provides all technical and management decisions. Brown’s cradle-to-grave project approach includes writing grants and securing project funding, project design, permitting, facilitating stakeholder and public meetings, development of detailed designs and specifications, managing subcontracted professionals, providing construction administration services, and consulting on various aspects for implementing successful projects.

His professional society involvement includes serving as the ASPE Anchorage Chapter president, vice president and secretary/treasure between 2006 and 2009. In addition, he co-chairs the Anchorage E-Week Steering Committee, proctors MATHCounts, organizes continuing education seminars and teaches the wastewater refresher course to civil engineers preparing for the Professional Engineering Exam. n

Lorie Dilley, P.E. – Nominated by Society of Women Engineers (SWE)

Lorie Dilley, Ph.D., PE, CPG, is a 35year Anchorage resident with more than 20 years of geotechnical engineering experience in Alaska. In January 2001, she and Scott Hattenburg launched Hattenburg & Dilley LLC, a firm specializing in civil and geotechnical engineering. In 2002 Dennis Linnell joined the firm, which became Hattenburg Dilley & Linnell LLC (HDL).

The firm grew to a vibrant, competitive firm of 40 in seven years. HDL was selected in 2008 and 2009 as one of the 10 best places to work in Alaska by the Alaska Journal of Commerce and the Best Companies Group.

Dilley was named one of Alaska’s “Top 40 Under 40” in 2002 by the Anchorage Chamber of Commerce and the Alaska Journal of Commerce for demonstration of professional excellence in the field of geotechnical engineering and display of commitment to her community. Her focus is currently on development of new techniques for geothermal exploration while maintain-

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

ing a growing geotechnical practice.

She has traveled extensively both for personal and professional reasons, and has served as volunteer teaching assistant on international field trips.

She most recently visited Sakhalin Island, Russia, where she participated in the Russian-American Friendship Club, discussing American culture, traditions and small business ownership. In Anchorage this year, she organized and spearheaded the company’s drive to create more than 80 backpacks filled with school supplies for refugee children. Dilley, a mother of two, volunteers at her daughter’s school, has served on the board of Catholic Social Services Adoption program and as a sister in Woman to Woman International. n Dee Fultz, P.E. – Nominated by the Electrical and Electronics Engineers (IEEE)

Dee Fultz grew up in Fairbanks, and graduated in 1993 from the University of Alaska Fairbanks with a Bachelor of Science Electrical Engineer (BSEE) degree. He is a registered Alaska professional electrical engineer.

Fultz has been employed by Chugach Electric Association for 17 years. As senior system operations engineer, systems control, his responsibility includes dynamic analysis of transmission and generation systems in support of operations and maintenance planning. Prior to 2009, Fultz served as a senior planning engineer in distribution services, where he was responsible for system performance analysis, improvement studies, long-range plans, and five-year capital improvement plans.

Fultz is a highly active member of IEEE. He was 1997 and 2004 Alaska Section Chair, 1998-2003 Professional Activities Chair, and 2006-2010 Government Activities Chair. He is currently 2010-2011 secretary/treasurer

of the Alaska Section Power and Energy Society Chapter. He served as 2005-2006 Region 6 Secretary (55,000 members in 12 western states), and 2007-2009 Northwest Area Chair (Alaska, Oregon, Washington state and northern Idaho). He will be 2011-2012 Region 6 Treasurer.

He has participated on numerous technical conference organizing committees, and will serve as 2011 General Chair of the Alaska Electric Utility Conference. He was a 1998-2007 member of the National Engineers Week Anchorage Steering Committee, and 2004 co-chair. He was a 1999-2003 member of the University of Alaska Anchorage Electrical Engineering Advisory Council.

Fultz is active in the Anchorage community as a 1996-2002 Alaska Science & Engineering Fair judge; 2001-2005 Taku Elementary Science Fair mentor; 2007-present committee chair, Cub Scout Pack 219; and plays electric bass in the group Jerry’s Situation.

Fultz has received many awards for professional and community service.

Most recently, he received the IEEE Alaska Section 2010 Outstanding Leadership and Professional Service Award. n Tim Gallagher, P.E. – Nominated by the Anchorage post of the Society of American Military Engineer (SAME)

Tim Gallagher, vice president with HDR Alaska has served in the engineering community for more than 28 years. He currently performs as HDR Alaska’s business development manager, based in the Anchorage office.

In this capacity, he leads HDR’s business development with clients across the state. He joined HDR four years ago after a distinguished 24-year career with the U.S. Army Corps of Engineers (USACE) serving in leadership, engineering, construction, environ-

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ment, regulatory, facilities and resource management roles.

With the USACE, Gallagher was the district engineer for the Alaska District from 2003-2006. He also served as assistant director of civil works and as an operations officer for the USACE headquarters in Washington, D.C. Overseas, he served as a battalion commander, plans officer, and construction manager. Gallagher has an established track record of building high performance teams and establishing great morale and communication.

Gallagher has a master’s degree in civil engineering from the University of Illinois and a bachelor’s degree in engineering from West Point.

He is an active volunteer in the community. For the last seven years, he has served as the volunteer coordinator for the Paralyzed Veterans of America moose hunt at the Chena Lakes Dam site in North Pole. In addition, he assists in the Food Bank of Alaska and the Catholic Social Services’ Thanksgiving meal distribution program. n

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intelligent transportation systems, street lighting and traffic signalization.

Johnson has been involved in numerous civil engineering projects in Alaska and the Pacific Northwest. His many projects include the development of more than 40 highway safety-improvement projects and the Fifth and Sixth avenues: L Street to Gamble Street Pavement Rehabilitation and Landscaping project for the Department of Transportation and Public Facilities, and the Municipality of Anchorage’s Business Boulevard Area Pedestrian Safety Improvements. The Business Boulevard project was selected as the 2002 Project of the Year by the Alaska American Public Works Association.

He is the past president of the Alaska Section of the Institute of Transportation Engineers and currently volunteers his time as the transportation chair of his community council. He loves to hike and snowshoe with his black lab in the Chugach and Talkeetna mountains.

Johnson is married to wife, Nikki, and has a wonderful daughter, Kahlee and son, Erich. n

Art Johnson, P.E. – Nominated by Institute of Transportation Engineers, Alaska Section (ITE)

Harvey Smith, P.E. – Nominated by American Society of Civil Engineers (ASCE)

A life-long Alaskan and a descendant of Matanuska Valley Colonists, Art Johnson graduated from the University of Alaska Fairbanks where he earned a Bachelor of Science in civil engineering.

He has worked in private and public practice as a civil engineer for more than 25 years, and has been with USKH Inc. for the last 19 years. As a principal civil engineer in USKH’s Surface Transportation Division, Johnson is responsible for the management of many of USKH’s traffic and transportation engineering projects. These projects in include the planning studies, highway safety improvements, roadway geometrics, traffic calming, pedestrian/bicycle facilities,

Harvey Smith began his career with the U.S. Army Corps of Engineers (USACE) in 1966. He has worked in Alaska since 1982, when he moved from Washington where he worked as a research engineer for the University of Washington, Coastal Engineering Lab. While largely unrecognized and working primarily ‘under the radar of publicity,’ Smith is highly regarded by coastal engineering professionals throughout the nation. His publication Alaska Coastal and Harbor Design Procedures Manual provides guidance to many professionals in Alaska. As the statewide coastal engineer, Smith supports State and federal agencies, as well

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

as consultants. He also teaches coastal and harbor engineering as an adjunct professor for the University of Alaska Port and Coastal Engineering program, developed by Professor Orson Smith, PE, Ph.D., chair.

Harvey Smith has a Bachelor of Science in civil engineering and a Master of Science in coastal engineering from the University of Washington.

Harvey started his career with ADOT&PF as a harbor engineer designing floating breakwaters, docks and other inner harbor facilities, and providing support to the USACE and local communities on rubblemound breakwaters and navigation. As the State divested itself of harbor ownership, he applied his knowledge to large coastal engineering projects and shore protection for airports, roads} and communities.

In 1986, he negotiated and worked on the first cooperative project in the nation between the State of Alaska and U.S. Army Corps of Engineers (USACE), Alaska District. Harvey has provided technical support to the USACE for 35 years. As part of this work, he advanced conceptual-level planning for large port and harbor structures through integrated-software development.

In his spare time, Smith designs and builds wheelchairs for dogs with back injuries, which is done at no cost to the dog or its owner. He is also the head of his local homeowners’ architectural committee. As an amateur photographer, Smith documents his projects, family events, and even volunteered to shoot the Anchorage Waterways Council Rubber Duck Race in the summer of 2009.

Additionally, he applies his training in naval architecture in designing and building recreational boats, including a 24-foot outrigger canoe. n

with assignments on the East and West coasts and a tour of duty in Japan as an artillery officer. He then started work with Schlumberger in its Rocky Mountain region. Over the next 12 years, he worked in many capacities and became the first certified production-logging engineer in the U.S. He moved to Alaska in 1969 and worked as a PL engineer in Cook Inlet and when the pipeline was approved in 1974 he transferred to Prudhoe Bay as Schlumberger’s first manager. In 1978, Warner started working for BP as a field engineer, then became BP’s well-interventions team leader on the Slope. In 1993, he moved into the office and worked projects such as ESP deployment on coiled

tubing and risk assessment of SSSVs. In 1995, he rotated back to the Slope as the well-interventions team leader. In 2000, Warner started working a variety of engineering assignments in Anchorage including the design and construction of the Prudhoe Bay S pad expansion, overseeing the Endicott Field operational programs, and his current role as the GPMA production engineer.

Anyone that has had the pleasure of working with Warner, and there are many of them, can testify to his engineering capability, warm nature and willingness to share his knowledge. He is a mentor to all engineers and developed the eline portion of BP’s wellintervention accelerated-development program. Warner is active in SPE and is an example of how to have a successful career in the oil industry.

Warner’s legacy in Alaska includes a son, Dwight, who is a petroleum engineer for BP on the Slope, and a grandson who is studying engineering and plays hockey for UAA. His true passions include downhill skiing and fishing. n

Ross Warner – Nominated by the Society of Petroleum Engineers (SPE) Ross Warner has a distinguished career that spans over 55 years. Raised in Duluth, Minn., he received a degree in physics and math in 1953 and was planning to become a teacher when the U.S. Marine Corps changed his career plans. He served three years in Marines

YEARS

Thank you, Alaska! :)

3940 Arctic Blvd., Ste. 300 Anchorage, AK 99503 | p. 907.562.3252 | www.crweng.com Photo taken at Ted Stevens Anchorage International Airport Terminal Connector | Architect: ECI/Hyer

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

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ENGINEERING SPECIAL SECTION

From Alaska to NASA

Devin Hahne puts engineering education to work Interview by David Hitt

In which NASA student opportunity project did you participate, and how did you get involved in it?

(I participated in) the NASA Student Internship Project through the Goddard Office of Higher Education. I was offered this internship after submitting a flurry of applications – there were many, many different projects and programs to apply for.

As an intern, I (worked) in the Xray astrophysics (directorate). With my primary mentor, I was exploring new designs of X-ray mirrors, which are used in telescopes that study the X-ray energy bands. With my secondary mentor, I used a (computer-aided design) tool to iterate the design of a proposed small explorer satellite. This satellite was going to use the aforementioned optics to research gravitational waves.

I felt very privileged because I worked with people in a lab that had been initiated in the 1960s, and so they had a lot of heritage and experience to share with me. Also, I participated in the genesis of a satellite mission and iterated its design concepts. My contributions ultimately motivated my mentors to offer me a full-time job.

What is your educational background, and what are your future educational plans?

I have a Bachelor of Science in Mechanical Engineering with an emphasis in Aerospace Engineering from the University of Alaska Fairbanks. I aspire to pursue a master’s degree, but I’m not totally decided in what – I have too many interests.

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What inspired you to choose the career field you did?

The Alaska Space Grant Program was the incubator and the motivator of my career. I didn’t even know what an engineer was when I started college in 2003. However, at a high school college fair, I was introduced to the ASGP rocket project at UAF and decided that I wanted to participate in that.

Also, looking back, I spent a lot of time playing with LEGOs. What do you think were the most important things you took away from your involvement with NASA? Scientists are real human beings with lives and bills and families and problems and joys, just like all other human beings. NASA is not some mysterious entity reserved for the highly privileged and exceptionally brilliant. It’s inclusive and opportunities are available.

At an ASGP symposium I spoke at in May 2010, I asked the question, “Do Alaskans think NASA is unreachable?”

I suspect a lot of Alaskans in the rural areas face a delusion that NASA is beyond them. Nonsense.

How has your NASA involvement affected your future?

My internship in 2007 led to the fulltime job I enjoy now. The experience and skills I’ve gained have broadened my horizons to include new aspects of engineering, science, academia, and how to professionally and personally interact with coworkers.

What are you doing now?

I am very blessed by my job and never dreamed how much fun being an engineer would be. I’m a design engineer; I work on three projects: Astro-H / Soft X-ray Telescope (SXT): This is a satellite-based X-ray observatory. I was tasked to design the SXT mirror, which means that I made solid models of the hardware and

Photo courtesy of Devin Hahne

W

hile growing up, Devin Hahne was inspired by stories of space exploration.

The Alaska Space Grant Program – and a NASA internship – taught him he, too, could work for NASA, where he designs scientific instruments to better understand the universe.

Devin Hahne

helped with manufacturing drawings.

Mostly, though, I am a liaison between the scientists and engineers – my role is to translate the needs of the scientists into the language of the engineers.

The X-ray Advanced Concepts Testbed (XACT): This is a sounding rocket mission which will be a proving ground for technology which will open new fields of X-ray astrophysics: X-ray polarimetry. I was tasked with the responsibility of the mechanical design of the whole payload.

Super TIGER: This is a balloon payload that is studying cosmic charged particles. My role is to iterate design ideas and render them in CAD so that the team is able to address the various problems that arise. I also generate the manufacturing drawings so that the detectors can be built.

What advice would you have for students who are interested in becoming involved with, or working for, NASA? Get exposed to what opportunities are available. Maybe you were interested in plant biology in high school, but never knew that there was a field of study in astrobiology. Find something you’re enthusiastic about and chase it. q

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

ENGINEERING SPECIAL SECTION

UAF Graduate Engineer at NASA Sky is limit for Tess Casswell

By Nicole A. Bonham Colby

T

he sky is apparently the limit for an Alaska woman who is among Mission Control Center operators at NASA’s Johnson Space Center in Houston. From a childhood spent growing up in a cabin outside Soldotna to now working the flight-control console for the nation’s space program, University of Alaska-Fairbanks (UAF) alumnus Tess Caswell says her Alaska roots have served her well in an industry that requires innovation and ingenuity.

“When I was growing up, we lived in a cabin about eight miles outside of Soldotna,” says Caswell, who holds a bachelor’s degree from UAF in mechanical engineering, with emphasis on aerospace engineering and minor in math. “We made our own entertainment. We learned how to have fun.

Playing around in the woods: that’s probably where my wanting to explore came from. Alaska is similar to space in that regard. Living up there and living through those ridiculously cold winters … living in that environment” gave her the tools necessary to create solutions – and a plan “to get things done,” she says.

Caswell has wasted no time in working that plan. She says she was fascinated in elementary school by her teacher’s wall-sized poster of a space shuttle orbiting Earth. That image made her want to become an astronaut, she says. When she later met astronaut Joe Allen, he suggested she consider pursuing her interest as an engineer.

While studying engineering at UAF, she discovered the Alaska Space Grant program and its Alaska Student Rocket Project. From that experience, her academic and professional career transited a sharp trajectory to the front

Photo courtesy of NASA

While a student at University of Alaska Fairbanks, NASA mission control operator Tess Caswell participated in the administration’s Reduced Gravity Flight Program for students.

lines of space-flight technology. Before ending up in Houston, Caswell participated in the Goddard Space Flight Center’s NASA Academy, and the NASA Reduced Gravity Program.

She now works in mission control for the International Space Station as a certified operator monitoring the Environmental and Thermal Operating Systems (ETHOS). “Operators are the first level of mission control flight controllers,” she says. “After more training, I will become a specialist and eventually may even become an instructor, teaching new flight controllers and astronauts about ETHOS.”

Asked if she is ever surprised to look around her “office” and realize it is one of the nation’s top scientific forums?

“When I first started here, I would see an astronaut and freak out,” she said.

Now, the realization of her opportunity usually comes when driving past the sign for Johnson Space Center each morning. “It’s not quite as intense as Apollo 13 all the time,” she laughs. “But if you turn on NASA TV, you could see me sitting there.”

While an intense schedule of training has kept her from traveling home as much as she wished, Caswell nonetheless says she maintains strong Alaska ties to family, friends and colleagues in the 49th State. She tells of spotting a UAF parking decal on a vehicle in the parking lot at Johnson – and tucking a note under the driver’s windshield wiper.

In retrospect, the opportunity to have practical, direct experience with space technology while a student in Alaska is unmatched, according to Caswell. At other universities she toured, thousands of students vied for a few, select opportunities. “You go up to UAF, there are five students who do everything,” she says of the hands-on and welcoming lab environment.

Alaska’s unique geographic location makes it a natural for space industry and research, she says. “Especially things like Poker Flat. There’s really not another high-latitude sounding rocket-research facility available to us, unless you go to Norway,” she says. “The biggest thing is to not forget Alaska can have a role in this kind of program. There are definitely opportunities for Alaskans and Alaska to participate in space flight.” q

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

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ENGINEERING SPECIAL SECTION

On the Front Lines:

Engineers Critical to Alaska’s Development Huge potential for local graduates

By Vanessa Orr

I

n a state as underdeveloped as Alaska, the need for engineers is crucial. From developing natural resources to building infrastructure to creating communications systems that link remote villages, the jobs that engineers perform are required to move Alaska forward.

“Only one and a half percent of the state is fully developed, and it is criti-

Photo courtesy of Richard Heieren

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cal that engineers be on the front lines of that process,” explains Architects, Engineers and Land Surveyors Board Chair Richard Heieren, PS, RCH Surveys, Ltd. “There is a big push for the continued creation of infrastructure to develop our natural resources, and telecommunications are critical because we have so many isolated communities. Whether you are talking about

electrical engineers, civil engineers or environmental engineers, they are all critical in the whole process.”

To this end, universities within the state are working to educate the next generation of engineers. And the State’s Architects, Engineers and Land Surveyors Board, which licenses all engineers within the state, is considering changing its licensing structure to add to the number of branches of engineering for which it provides examinations.

“Alaska presently licenses six branches of engineering: chemical, civil, electrical, mechanical, mining and petroleum, and three of the branches are comprised of several disciplines,” explained Richard V. Jones, executive administrator, Architects, Engineers and Land Surveyors Board. “The board is considering going to a general license structure, which would add all of the branches of engineering that the National Council of Examiners for Engineers and Surveyors (NCEES) has an examination for. There would then be a total of 16 branches licensed by Alaska.” This idea is currently out for public comment.

The State currently licenses engineers in civil engineering, which includes construction, geotechnical, structural, transportation, water resources and environmental; electrical engineering, which includes control systems, computer, electrical and electronics and power; and mechanical engineering, which includes HVAC and refrigeration, mechanical systems Left: Richard Heieren, PS RCH Surveys Ltd., Chairman of Architects, Engineers and Land Surveyors Board

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

and materials, and thermal and fluids systems. It also licenses chemical, mining and petroleum engineers.

If a general licensing structure is approved, the board will begin licensing engineers in 10 other branches including agriculture; architectural; control systems; environmental; fire protection; industrial; metallurgical and material; naval architecture; marine, nuclear and petroleum; and structural.

Engineering as a Career

As the need for engineers in a variety of disciplines continues to grow, so does the need for students interested in an engineering career. Fortunately, that number continues to increase.

“Schools that provide engineering and surveying programs are seeing enrollments increase, which is very promising,” said Heieren. “And for every engineer who gets through the system here in Alaska, there’s another engineer outside the state who wants to move to Alaska. I’d estimate that half of the engineers currently working in the state are from Alaska, and half have come from Outside.”

Students looking for a career in the field don’t have to look very far. The University of Alaska Anchorage (UAA), for example, offers both undergraduate and graduate programs in the field.

“On the undergraduate level, we offer degrees in civil, electrical, mechanical, computer systems and geometrics,” explained Rob Lang, Ph.D., PE, dean and professor of civil engineering at UAA. “On the graduate level, we offer master’s programs in civil engineering, Arctic engineering, engineering management and project management.”

According to Lang, the university’s civil engineering program concentrates on basic infrastructure needs such as roads, bridges, buildings, water treatment and wastewater treatment. Its electrical engineering degree focuses on power generation and transmission, and its mechanical engineering degree focuses mainly on HVAC systems for Alaska.

“The computer systems degree concentrates on software programming with an emphasis on hardware utilized, and the geomatics program focuses on land surveying on a broad scale from property boundaries to construction

R S A Engineering, Inc.

Photo ©Ken Graham Photography

Photo ©Ken Graham Photography

Mechanical & Electrical planning, design, construction administration, commissioning and sustainable compliance for the Anchorage Museum at Rasmuson Center Expansion Project. www.rsa-ak.com u 276-0521 u info@rsa-ak.com

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

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Photo courtesy of UAA

Rob Lang, Ph.D., PE Dean and Professor of Civil Engineering University of Alaska Anchorage

surveys to route alignment surveys,” explained Lang. “Being able to create and interpret maps utilizing satellite and aerial photography is very important in Alaska, where there is such a large expanse of area to cover.”

One program relatively unique to Alaska is Arctic engineering, which focuses on how to design and build in specific conditions of the Arctic environment, such as frozen ground, snow loads, ice loads and Arctic utilities.

In addition to graduate Arctic engineering and civil engineering degrees, UAA also offers an engineering management degree that teaches students how to manage large engineering projects. “This has become increasingly important as more multinational engineering companies begin working in Alaska,” said Lang. “Engineers increasingly find themselves working on teams and on projects that span across states.”

The school’s popular project management degree focuses on the design, execution and tracking of individual projects such as gas pipelines or power plants, which have a finite beginning and end. “Students learn how to muster all of the available resources and control costs and schedules on an individual project,” said Lang.

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Since expanding its engineering programs five years ago to include electrical, mechanical and computer systems degrees, UAA has seen a huge spike in enrollment, going from 450 students in 2002 to close to 1,000 now. About half of its students come straight out of high school, and half are nontraditional students who have already been out in the work force. Through the Alaska Native Science & Engineering program (ANSEP), a longitudinal model that works with students from the time they are in middle school all the way through to a Ph.D., more than 100 students from villages throughout the state are enrolled at the university in engineering and science programs.

Approximately 90 percent of its engineering students are from Alaska, and a high percentage stay in the state to work.

“In Alaska, there is a continuous backlog of projects and a great demand for people with technical skills,” said Lang. “When you compare Alaska with other states, there is still so much development of basic infrastructure that needs to happen.

In Juneau, there are no roads that lead out, and there are a number of cities in that same situation. In some areas, the amount of bandwidth available for Internet connections is very limited, and many of the villages still need access to clean water and sanitation.

These are perennial problems that have challenged Alaska from statehood and even before, and they are not tackled easily.”

Becoming an Engineer in Alaska

To become an engineer in Alaska, all applicants must be approved by the Architects, Engineers and Land Surveyors Board, who review applications at quarterly meetings in February, May, August and November. Applicants can apply by examination or, if they’re already licensed in another jurisdiction, by commity for reciprocity.

“The board compares how they were licensed in the other jurisdiction to our regulations at the time they obtained licensure in the other jurisdiction,” explained Jones. “If they are equal to or exceed our requirements, we issue them a license; if not, we let them know what they need to do to

meet our requirements.” All applicants must also pass a board-approved Arctic engineering course, which covers the extreme conditions in Alaska and dealing with permafrost.

To qualify by examination, applicants need to pass the NCEES Fundamentals of Engineering (FE) examination and the NCEES Principles and Practice of Engineering (PE) examination for the branch in which they want to be licensed. Once the FE is passed, the applicant is considered an engineer in training (EIT).

“Once the EIT has accrued the required experience under a licensed engineer, he or she can apply for the PE exam,” explained Jones. “The amount of experience required depends on the amount of education the applicant has. With a Bachelor of Science, it would be four or five years, depending on the degree. A Master of Science would take a year off of the required experience.”

To date, approximately 5,400 engineers have been licensed by the board and more are expected to join the ranks as the need for qualified engineers continues to grow. “I would anticipate that the gas line could create quite a few jobs, and I feel that there’s about a 50/50 chance that it’s going to happen,” said Heieren. “If we’re lucky, it will happen in the next 10 years, though it could be 20 years.

“There are actually other things happening across the state that will have a bigger impact,” he continued. “Right now, one of our biggest problems is energy needs; it’s ironic that we are the richest energy state in the U.S., but the per capita expenses are also the greatest for individuals. Engineers and surveyors have a huge role to play in the state’s infrastructure, and since housing prices have dropped, there’s a need for residential development. There also been a positive upswing in military spending, which will help sustain jobs.”

As Alaska continues to grow, so does the opportunity for those who seek a career in the engineering field.

“As an engineer or surveyor in Alaska, you have the ability to do little better than in other states and to make decent money,” said Heieren. “There’s such huge potential here, but it can’t be realized without engineers.” q

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

ENGINEERING SPECIAL SECTION

Alaska Universities Engineer the Economy

Statewide entrepreneurship programs foster change

Photo courtesy of College of Business & Public Policy at UAA

By Heidi Bohi people don’t know what others are doing.” Efforts such as the business plan competition and the Arctic-innovation competition were a way to link the various campuses.

But economic development takes time, especially in a state that is relatively young, geographically isolated, has no manufacturing, a small population base, and has been dependent on mostly the petroleum industry and federal government for most of its existence. While university faculty and staff remain optimistic about the longterm possibilities, the reality is that measurable results will take decades to realize.

“It is a problem of generations,” says Jim Collins, University of Alaska Fairbanks director of entrepreneurship. “It’s not something that will be solved in 10 years and it will not happen by waving a governmental wand.

Dean of the College of Business & Public Policy at the University of Alaska It will happen by creating a context Anchorage Elisha R. “Bear” Baker IV welcomed and introduced a presentation by in which private individuals invest on Hong Kong Commissioner, Donald Tong, “Hong Kong: A Destination & Gateway to their own.” He estimates it could take China for the U.S.” last September.

25 to 50 years to develop an alternate economic base equal in scale to the s big oil saddles up and starts marketplaces and sectors. oil industry. making its way into the sunset, About two years ago, an informal In the meantime, he adds, if in the leaving Alaska with memories group of faculty from all three major next decade the university can point to of “back in the day,” the state is learning campuses began meeting to talk about a handful of firms the university’s efforts a painful lesson on the importance of how the university could better apply helped start or grow, then that will be what happens when there is a lack of its resources to foster economic and a measure of success. economic diversification. business development in Alaska. Last Some progress has been made The University of Alaska system spring, it became an official statewide to make the business community is investing in developing a statewide economic development work force aware of the university’s $123 milentrepreneurship program, with hopes that started by inventorying the uni- lion research effort, which Collins that it will become a critical contributor versity’s activities in economics and says, most people are not aware of, to part of the solution. Efforts rang- business development. resulting in valuable research “that ing from business plan competitions ends up in binders stuck on shelves to adding curriculum that teaches an 50-Year Plan and never transitions into the private entrepreneurial way of thinking are be- Elisha R “Bear” Baker, dean of the sector.” In the past year, though, local ing promoted so the public and private College of Business and Public Policy entrepreneurs have started paying atsectors can start to see how they can at the University of Alaska Anchorage tention to what faculty is doing and cooperatively develop opportunities (UAA) said, “First, even within the in a few cases decided to invest in in business ventures that may lead to university system, we had to get people the university’s efforts to grow and the development of new industries, talking to each other. In many cases, diversify the economy.

A

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Academic Exercises

In one case, an investor who learned about the university’s work in the mining industry, invested in a sizeable chunk of land that the State’s geological data and UAF’s satellite imaging resources suggest may have valuable mineral deposits.

This is a classic case of how public and private resources resulted in an entrepreneurial venture.

The Alaska Peony Growers Association also is working with the Alaska Division of Agriculture and the university to gather research data and information to help develop international markets for peonies and expand Alaska’s agricultural export industry. Peonies bloom at a time when they are not available elsewhere and, because of the state’s geographical location, allows fresh flowers to be quickly air-freighted to U.S., European and Asian markets. Currently, peony growers are working with the university and its land grant mission to see if the idea is feasible.

All three campuses of the university are, in varying degrees, starting to implement entrepreneurship efforts on their respective campuses. Rick Wolk, assistant professor of marketing and entrepreneurship at the University of Alaska Southeast (UAS), teaches classes in this discipline and is involved in the annual system-wide business plan competition, which is entering its 11th year.

The idea behind the program is to give students the chance to practice being an entrepreneur and make mistakes when there is no money on the table, while also helping them decide if they have the entrepreneurial spirit, Wolk says. Although some of the ideas in the competition lead to the development of actual businesses, to date most of them have simply been academic exercises.

Entrepreneurial Thinking

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Matthew McDaniel and Krag Johnsen were part of a team that entered the business plan competition in 2001 as MBA students at Alaska Pacific University (APU). Their idea was to develop a distribution channel for selling Alaska Native arts and crafts so more of the profits stayed with the artist, creating more wealth in rural communities. At the time, developing a website to do this was considered an innovative way www.akbizmag.com • Alaska Business Monthly • February 2011

to broker the artwork. The business model also included a way to supervise production and collect raw materials in the communities such as baleen, bone, fur and ivory.

Local investors expressed interest and Johnsen believes there still might be potential for the idea, but nothing ever happened with the business venture as he and the other participants were launching successful careers at the time and have since started families, making the risk factor that goes with being an entrepreneur less appealing.

Still, McDaniel and Johnsen agree, the competition left both of them with an entrepreneurial mindset they have used in previous and current professional capacities. McDaniel is finance director for the Pebble Partnership and Johnsen is rural broadband development director for GCI. “We need to keep creating an environment where new business start ups can happen in Alaska and we’re not just relying on the oil industry,” Johnsen says, adding that GCI, today the third-largest employer in the state, was started in 1979 by Ron Duncan and a few others who were committed to increasing competition in Alaska’s telephone business. Today Alaskans are benefiting from greater service, lower costs and the statewide jobs created by the company born from entrepreneurial thinking.

Both Johnsen and McDaniel continue to support efforts like these by donating money and participating as judges.

“What I loved about the experience was we created something out of nothing,” McDaniel says. “As I moved on in my career, the experience was a big light bulb for me. It got me to the point where I thought of every single angle and could answer investors’ questions before they had them, which is useful for a business start-up or a transition.”

Angel Investors Needed

As part of his role teaching entrepreneurship at the UAA campus, Al Hermann is working on several entrepreneurship programs within the College of Business and Public Policy, including establishing Alaska Angel Investors, an angel-investing group that assists companies in their efforts to start doing business in Alaska, which is the only state without an Angel Network. www.akbizmag.com • Alaska Business Monthly • February 2011

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The group recently completed the funding of Bare Distillery, the first of six to 12 companies the network expects to fund in the next two years as it grows the number of angel investors to about 70 people who are current or former entrepreneurs. Typically, these individuals invest between $25,000 and $250,000 into a business with hopes of making a return on their money, or simply because they are interested in the project, Hermann says. To qualify, “angels” need to have between $200,000 and $1 million in assets.

In the case of Bare Distillery, started by two Alaskans, the product line will be spirits that are made with 100 percent Alaska water and other ingredients. Although the project started about three years ago, by the time the company was ready to start producing it had run out of money and needed $400,000 to go into operations. The Small Business Administration referred them to the Angel Network and currently the company is in product development and final marketing stages and expects spirits to be on the shelves by April.

There will be a board of directors and an advisory board, Hermann says, and investors are hoping to make back five to seven times their investment within a five-year timeframe.

Innovation, Support, Marketing

Entrepreneurial efforts rely on three components to be successful: innovation, which can come from any program

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Alaska Research Potential

Engineering plays a critical role in

Photo by Grant Baker

Photo courtesy of Grant Baker

Grant Baker Associate Dean School of Engineering University of Alaska Anchorage

within the university although perhaps most often from engineering, science and agricultural programs, which develop ideas for commercialization; private industry support; and the School of Business, which heads up marketing efforts. One of the newest additions to advance the university’s entrepreneurship efforts is through UAA’s Engineering Department, which recently completed the Rapid Prototype and Manufacturing (RPM) Lab at its School of Engineering.

The lab includes computers, scanners, milling machines, a laser engraver and other manufacturing equipment, allowing students to build prototypes of surgical instruments, personalized joint replacements, model aircraft and vehicles, buildings, bridges and pipelines.

A special 3D printer also allows students to take computer-aided drawings to create 3D prototypes using the latest technology available for civil, computer, electrical or mechanical engineering assignments. The lab reduces the amount of time required to design and manufacture a new, patentable prototype from weeks or months to hours, says Grant Baker, associate dean of the School of Engineering. At the same time, the multiplier effect is very significant in terms of the economic impact: there is about five support staff for every engineer working on a project.

Several designs show great potential for being patented and marketed and are in the process of being advanced through the university system, he says.

A robotic hand, operated by remote control, can be used during surgery and other processes, and can also be used as a prosthetic. Also in the health care industry is a nonintrusive sensor used in dentistry to measure gum thickness.

Rather than using a probe to measure pockets that may indicate periodontal disease, a sensor is run along the gum line. A spinal rod bender is another invention in the industry. Titanium rods are typically used to treat ailments such as curvature of the spine, by bending them to fit the patient’s back during surgery. The university’s invention is a one-handed device that allows physicians to bend the rod with one hand instead of two.

UAA Mechanical Engineering student Andrew Cochran and the Baja competition vehicle entered into 2010 National Baja design competition shown at the biannual UAA Engineering Design Competition.

the university’s entrepreneurship efforts because prototypes that are patented through the school and marketed may be profitable for both the student and the university, while also adding prestige to the campus, Grant Baker says. In general, research is big business for higher learning institutions and Anchorage is especially well situated for these opportunities with about 100 companies and agencies within just a few miles of the university, allowing academics and industry to work in tandem. This is critical in advancing entrepreneurial efforts because receiving federal funding is contingent on also having partnerships with private industry in areas ranging from technology, to health care and alternative energy.

Currently, UAA alone brings in about $15 million a year in research funds.

“There is no reason we cannot bloom that to $200 million a year from federal government and industry,” he says, adding that the government has billions of dollars in research funding available.

“Alaska’s portion has been small, which is why there is such big potential.”

Although the entrepreneurship efforts at the university are just beginning, Grant Baker says faculty and administration in the Engineering Department and the College of Business and Public Policy are committed to developing projects-based curriculum that apply theory to help develop projects that create an environment of innovation similar to a think tank.

“Although they are not massive projects, they all need engineers, which keeps a lot of high paying jobs and projects in the state,” Grant Baker says. q

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

ENGINEERING SPECIAL SECTION

Will We Be Ready?

Training Alaskans for gas pipeline jobs

By Vanessa Orr

Photo courtesy of Alaska Department of Labor and Workforce Development (ADLWD)

Annual pipeline training in Fairbanks circa 2007.

F

or years, there’s been talk about the natural gas pipeline in Alaska.

Who would build it? What route would it take? And of course, will it ever happen?

While most people think that the creation of the pipeline is a good idea in the sense of improving Alaska’s economy and creating jobs, one of the biggest questions has yet to be answered – who in Alaska has the experience and the training to fill the positions it creates?

The fact is, $1.8 billion leaves the state in earned wages to nonresidents every year, so how does the State plan to fill the thousands of jobs that the pipeline creates with people who live on the Last Frontier?

Fortunately, in 2007, the Alaska Legislature charged the commissioner of the Alaska Department of Labor and Workforce Development (DOLWD) with just this task. The Alaska Gasline Inducement Act of 2007 requires that the commissioner develop a job-training program to provide training for

Alaskans in gas pipeline project management, construction, operations, maintenance and other gas pipelinerelated positions.

According to the Alaska Job Center Network, the gas line will provide approximately 6,500 direct construction jobs in the short-term and create more than 50,000 indirect jobs in the longterm. Permitting, engineering, pre-construction and construction jobs will be phased in over the next two to six years.

According to Pipeline Training Administrator and Apprenticeship Coordinator Gerald “Gerry” Andrews, when this work force development project first got under way, one key component was missing: collaboration between all of the entities would be affected, such as the Alaska Department of Education and Early Development (DEED), the DOLWD, and the University of Alaska.

“Some of these groups already had their own semi-stand-alone plans, but what we needed was an articulated plan that encompassed everyone in a

collaborative fashion; not just sites of education and sites of work force development,” he explained. “Our goal was, and is, to make a seamless education and work force development system.”

Jobs Galore

Out of this came the AGIA Strategic Training Plan, which resulted in the creation of Andrews’ position and the position of a Career and Technical Education (CTE) coordinator. Andrews oversees the training needs for the gas line and registered apprenticeships, and CTE Coordinator Jeff Selvey insures alignment and collaboration with all of the CTE partners.

“Our goal is to align career and technical training programs in the state to provide maximum efficiency, effectiveness and access for all Alaskans,” said Commissioner Clark “Click” Bishop at the plan’s commencement. “We’re going to need the help of all of our stakeholders to realize this connected system so that Alaska and Alaskans benefit.”

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

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The CTE plan for the State includes programs of study, such as the one in place in the Mat-Su School District; personal career learning plans; career and technical student organizations; a Rural Training Center System (RTC); registered apprenticeships; and articulated credit through a TECH PREP system and the University of Alaska.

The AGIA training plan has identified 113 occupations related to the gas line from cook and baker to electrical engineer. “Alaska job seekers must decide on what occupation or industry they would like to work in and locate training,” said Andrews. “This is where we are focusing much of our efforts in awareness.

“There’s a lot of work to be done, and there’s no magic bullet,” he added.

“We’re going to need workers who are educated on all levels ranging from on-the-job training, to certificates, to on-the-job endorsements to degreed professionals.”

Reaching Prospective Job Seekers

Letting Alaskans know of the opportunities available is half the battle when it comes to training resident workers.

“In an aligned system, a student would be aware of jobs or occupations in kindergarten through fifth grade, explore jobs and occupations in grades seven through nine, and prepare or develop their skills for the next step in grades 10 through 12,” said Andrews. “But many parents have not coached their children about what happens after high school.

Parents and students may not have the tools they need to get from kindergarten to a four-year degree.

“Even if the student knows what he or she wants, they may not be aware of how they can get there,” he added. “A student may want to become an ablebodied (AB) seaman, but not realize that training is offered in Ketchikan and Seward. Today, we are creating tools to eliminate these gaps in information.”

Reaching by Teaching

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There are a number of ways in which the Alaska Department of Labor is doing this. Investments have been made around the state in the Alaska Construction Academy model in order to introduce youth and dislocated adult workers to basic construction www.akbizmag.com • Alaska Business Monthly • February 2011

skills. In fiscal year 2009, the Alaska Construction Academy trained 1,645 youth and 416 adults in a variety of gas line occupations.

Funding was also provided for school-based career guides to provide career-planning services and job referral to secondary students. Last year, the Alaska Youth First Program delivered awareness activities through career guides to 18,976 Alaska youth.

An investment was made in sponsoring secondary school teacher externships and summer construction and engineering academies as a way to reach students. “The Alaska Process Industry Careers Consortium (APICC) provided teachers with externships as a way to learn more about the types of careers available and the skills that are needed,” explained Andrews. “For example, BP took two teachers to the North Slope to show them how the lessons that they were teaching applied to their business.” It is estimated that as many as 2,000 school students are affected by participating teachers each year.

In addition to careers that require academic degrees, major strides are being made in educating technical students and those considering apprenticeships about the opportunities available to them. AVTEC (Alaska Vocational Technical Education Center) staff has visited more than 200 schools and career fairs in the past two years, during which time they also trained more than 250 individuals between the ages of 17 and 21 in gas line-related occupations.

Funds were also provided through the American Recovery and Reinvestment Act to the Department of Transportation campaign, “Think Apprenticeship,” which is designed to encourage Alaska youth to consider the heavy highway and construction industries.

“My job as the apprentice coordinator and Jeff’s job as the CTE coordinator is to go out into the community and encourage local hire,” said Andrews.

“Many companies are overlooking their best opportunities, though some Native corporations and for-profit companies have figured it out – they don’t need to go out of the area; they need to create a structure to develop a skilled work force, allowing employees to mature in the field.

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“For example, one year an employee might be loading a dump truck, but through a registered apprenticeship, that person can learn more skills and the next year be building a road. The year after that, they could be working as a motor grader operator for the same company,” he explained.

While union apprenticeship programs are paid for out of a benefit each member earns, other individual expenses, like travel, room and board, may be leveraged by the DOLWD through a STEP (State Training and Employment Program) grant. DOLWD is also planning to offer some startup assistance for new apprenticeship programs, such as the Nondestructive Testing Program (NDT) offered in Kakivik, the first NDT apprenticeship program in the nation to be approved by the U.S. Department of Labor.

Utilizing the latest computer technology, job seekers will be able to enter their credentials as part of their online resumes in ALEXsys, Alaska’s skills-based job bank. This will help the Employment Security Division (ESD) to better match jobseekers’ skills with employers’ requirements. A variable reporting function also enables ESD staff to reach out to job seekers with specific skills to advise them of training opportunities. Outreach is also being done through AKCIS, the Alaska Career Information System.

“When you look at the raw data, it shows that there are enough people in Alaska to build the pipeline today, but they need to be trained in the skills necessary,” said Andrews of the possibility of meeting the needs of such a huge project. “However, when you look at the practical data, such as rotation, shift work, and the grain of the work force, you can see the gaps. The gas line won’t be the only big project in the next 10 years; there are some proposed mines and a number of energy projects on the table. What this shows us is that Alaska has to step up to the plate to encourage young Alaskans to understand what jobs are available in the work force and how to get the education that they need.

“Even though it may be years before the gas pipeline gets under way,” he added, “what’s important now is developing a skilled work force for today’s employers.” q www.akbizmag.com • Alaska Business Monthly • February 2011

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Bettisworth North Architects & Planners 212 Front St., Ste. 200 Fairbanks, AK 99701 Phone: 907-456-5780 Fax: 907-451-8522

Charles B. Bettisworth, AIA/Pres.

Bezek Durst Seiser 3330 C St., Ste. 200 Anchorage, AK 99503 Phone: 907-562-6076 Fax: 907-562-6635

Daniel Seiser, Pres.

Blue Sky Studio 6771 Lauden Cir. Anchorage, AK 99502 Phone: 907-677-9078 Fax: 907-677-9079

Catherine Call, Owner

Design Alaska Inc. 601 College Rd. Fairbanks, AK 99701 Phone: 907-452-1241 Fax: 907-456-6883

Jack B. Wilbur, Pres.

Don Dwiggins Associates 1401 W. 34th Ave. Anchorage, AK 99503 Phone: 907-274-1643 Fax: 907-272-0630

Don Dwiggins, Principal

ECI/Hyer Inc. 101 W. Benson Blvd., Ste. 306 Anchorage, AK 99503 Phone: 907-561-5543 Fax: 907-562-3213

Mary Knopf, Principal

Jensen Yorba Lott Inc. 522 W. 10th St. Juneau, AK 99801 Phone: 907-586-1070 Fax: 907-586-3959

Wayne Jensen, AIA/Pres.

Ke Mell Architects PO Box 21898 Juneau, AK 99802 Phone: 907-463-3942 Fax: N/A

Ke Mell, Owner

kpb architects 425 G St., Ste. 800 Anchorage, AK 99501 Phone: 907-274-7443 Fax: 907-274-7407

Mike A. Prozeralik, Pres./Principal

Larsen Consulting Group Inc. 3710 Woodland Dr., Ste. 2100 Anchorage, AK 99517 Phone: 907-243-8985 Fax: 907-243-5629

Wallace Swanson, President/CEO

Livingston Slone Inc. 3900 Arctic Blvd., Suite 301 Anchorage, AK 99503 Phone: 907-562-2058 Fax: 907-561-4528

Thomas Livingston, FAIA

Martha Hanlon Architects Inc. PO Box 72292 Fairbanks, AK 99707 Phone: 907-458-7225 Fax: 907-458-7226

Martha L. Hanlon, AIA/Pres.

Michael L. Foster & Associates Inc. 13135 Old Glenn Hwy., Ste. 200 Eagle River, AK 99577 Phone: 907-696-6200 Fax: 907-696-6202

Michael L. Foster, PE, Owner

RIM Architects 645 G St., Suite 400 Anchorage, AK 99501 Phone: 907-258-7777 Fax: 907-279-8195

Larry Cash, Pres./CEO/COO

RIM First People LLC 645 G St., Ste. 400 Anchorage, AK 99501 Phone: 907-644-7877 Fax: 907-279-8195

Michael Fredericks, Owner

Services Services

1950

29

Architectural design, space planning, interior design, and master planning for commercial, industrial, residential, medical, religious and educational facilities statewide.

1976

23

Offices also in Anchorage at 2600 Denali Street, Suite 710, Roy Rountree, Principal.

Quality professional design serving Alaska since 1976. Thirteen registered and associate architects, two landscape architects, and two interior design staff offering full design and planning services.

1981

19

Master planning, space planning, concept development, design, grant assistance, project development, feasibility and development assistance.

2002

3

Architecture with a focus on residential and food service projects.

1957

70

Design Alaska provides architecture; civil, structural, mechanical, fire protection, electrical, and environmental engineering; landscape architecture; and design survey.

The firm also provides interior design; furniture, fixtures and equipment selection; and participates on art selection boards.

1973

4

Full-service architecture, space planning, interiors and facilities management assistance.

1981

18

Interior design and space planning.

1935

14

Planning, programing, design and construction administration for architecture, interior design, space planning and construction management.

1987

1

Architecture, including design and construction documents, planning and consulting.

1981

35

Full service cold climate/arctic design experts in architecture, planning, landscape architecture, interior design and design-build; federal, health care, K-12 schools, Native and commercial projects.

1993

20

Architecture, engineering, civil, sanitation, structural, land surveying, mapping, construction management, design and supply.

1975

24

Architecture (all phases), civil engineering, planning/programming, project management, interior design, lab planning/programming, construction administration, site selection assistance and project PR assistance.

1998

2

Architectural design and project planning.

1998

25

Environmental planning documents (EA/EIS), full-service A/E firm with design/build capabilities, construction management and general contracting.

1986

35

Providing comprehensive architectural services since 1986, RIM Architects strives to better the quality of life in the local community through good design, functionality and a sense of continuing vitality.

2002

1

Alaska Native-owned and operated company providing architectural and project management services. In addition the firm offers its specialization in participatory design, adding value to the client's project. Committed to incorporating the significance of the user in the design process.

dlove@architectsalaska.com www.architectsalaska.com

info@bettisworthnorth.com www.bettisworthnorth.com

bds@bdsak.com www.bdsak.com

catherine@callbluesky.com www.callbluesky.com

mail@designalaska.com www.designalaska.com

don@dondwiggins.com www.dondwiggins.com

contact@ecihyer.com ecihyer.com

www.jensenyorbalott.com

kemell@alaska.com

info@kpbarchitects.com www.kpbarchitects.com

holly@larsen-anc.com www.larsen-anc.com

lsi@livingstonslone.com www.livingstonslone.com

info@mh-architects.com www.mh-architects.com

hlm@mlfaalaska.com www.mlfalaaska.com

info@rim-ak.com www.rimarchitech.com

mfredericks@rimfirstpeople.com www.rimfirstpeople.com

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

85

ABM’s 2011 Architects & Engineers Directory Architecture Firms

Company Company

Top AK AK Estab. Empls.

Empls.

Top Executive Executive Estab.

UMIAQ 6700 Arctic Spur Rd. Anchorage, AK 99518 Phone: 907-677-8220 Fax: 907-677-8286

Richard Reich, P.E., Gen. Mgr.

USKH Inc. 2515 A St. Anchorage, AK 99503 Phone: 907-276-4245 Fax: 907-258-4653

Timothy J. Vig, Pres./Principal

WHPacific Inc. 300 W. 31st Ave. Anchorage, AK 99503 Phone: 907-339-6500 Fax: 907-339-5327

Lynn Bruno, Pres.

Services Services

1982

92

Regulatory planning, stakeholder relations, architecture, engineering, surveying, geospatial analysis, response planning and operations, civil construction, logistics and full-service camps.

1972

112

Architecture; civil, structural, transportation, mechanical and electrical engineering; land surveying; airport planning and design; planning; public participation; environmental services; landscape architecture; GIS Services; haz-mat services; interior design; construction administration; and LEED.

1981

65

Architecture; civil, structural, electrical and mechanical engineering; planning; surveying and mapping; transportation; water resources; environmental, energy and construction services.

info@uicumiaq.com www.ukpik.com

marketing@uskh.com www.uskh.com

kjacobson@whpacific.com www.whpacific.com

Engineering Firms

Company Company

Top AK AK Estab. Empls.

Empls.

Top Executive Executive Estab.

Alaska Analytical Laboratory 1956 Richardson Hwy. North Pole, AK 99705 Phone: 907-687-7394 Fax:907-488-0772

Stefan Mack, PE/Pres.

AMC Engineers 701 E. Tudor Rd., Ste. 250 Anchorage, AK 99503-7457 Phone: 907-257-9100 Fax:907-257-9191

Boyd Morgenthaler, Pres.

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

Jeff Kinneeveauk, Pres./CEO

BBFM Engineers Inc. 510 L St., Ste. 200 Anchorage, AK 99501-1949 Phone: 907-274-2236 Fax:907-274-2520

Dennis L. Berry, Pres.

Bratslavsky Consulting Engineers Inc. 500 W.27th Ave., Ste. A Anchorage, AK 99503 Phone: 907-272-5264 Fax:907-272-5214

Tanya Bratslavsky, Pres.

Bristol Environmental & Engineering 111 W. 16th Ave., Third Floor Anchorage, AK 99501 Phone: 907-563-0013 Fax:907-563-6713

Travis Woods, Sr. Engineer/COO

CH2M Hill 949 E. 36th Ave., Ste. 500 Anchorage, AK 99508 Phone: 907-762-1500 Fax:907-762-1600

Thomas Maloney, Area Manager

Civil Science Inc. P.O. Box 495 Klawock, AK 99925 Phone: 907-222-2400 Fax:907-222-9950

Blaine M. Comer, PE/Principal

Coffman Engineers 800 F St. Anchorage, AK 99501 Phone: 907-276-6664 Fax:907-276-5042

Harold L. Hollis, PE/Sr. VP

Combs Engineering 503 Charteris St. Sitka, AK 99835-7042 Phone: 907-747-5725 Fax:907-747-5725

Services Services

2008

2

Environmental testing laboratory, soil and water analysis for methods 8021B/AK101, AK102/103, ADEC certified.

1981

38

Mechanical, electrical, plumbing, controls and telecommunications engineering.

klovejoy@alaska-analytical.com www.alaska-analytical.com

info@amc-engineers.com www.amc-engineers.com 1985

info@asrcenergy.com www.asrcenergy.com

2,865 From the earliest regulatory stage through exploration, drilling support, engineering, fabrication, construction, project management, operations and maintenance and field abandonment, AES delivers excellence in every aspect of oil field service and industrial facilities development.

1996

16

Structural engineering.

1985

15

Full design, value engineering, stream restoration, communication facilities and towers, seismic and cold regions engineering, tenant improvements, construction management and inspections, project management, QA/QC.

1994

25

Offering total project management, Bristol has access to an $8 million fleet (market value) of heavy equipment, including bulldozers, loaders, excavators, crushers and haulers. Our services include: civil engineering, general civil design, environmental engineering, construction and more.

cmaynard@bbfm.com www.bbfm.com

mail@bce-ak.com www.bce-ak.com

info@bristol-companies.com http://beesc.bristol-companies.com 1969

Tom.Maloney@ch2m.com ch2mhill.com

3,000 CH2M HILL is a full-service environmental, engineering, construction and O&M serving AlaskaÕs energy, natural resources, transportation, facilities, environmental, and utilities markets.

2006

6

Consulting civil engineering, water resource engineering, transportation engineering, aviation engineering, wastewater facilities engineering, municipal engineering, parks and recreation engineering, GIS and construction management of civil infrastructur

1979

80

Coffman Engineers offers multidiscipline engineering consulting services including civil, structural, mechanical, electrical and corrosion control engineering, as well as commissioning, seismic analysis, pipeline integrity management, and process piping.

Chris Combs, PE

1994

1

Mechanical engineering, including heating, ventilation and plumbing

CRW Engineering 3940 Arctic Blvd., Ste. 300 Anchorage, AK 99503 Phone: 907-562-3252 Fax:907-561-2273

D. Michael Rabe, Managing Principal

1981

60

Civil engineering, electrical engineering, surveying and mapping, planning, permitting, public involvement, construction support, site development. Fields: water, sewer, water quality, sanitation, parks, trails, transportation, power and energy systems.

Del Norte Surveying Inc. PO Box 110553 Anchorage, AK 99511 Phone: 907-345-8003 Fax:907-345-8002

Lisa Greer, Owner

1986

4

Land and construction surveying.

86

info@civilscience.com www.civilscience.com

anchorageinfo@coffman.com www.coffman.com

info@crweng.com www.crweng.com

lgreer@dnsalaska.com

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

ABM’s 2011 Architects & Engineers Directory Engineering Firms

Company Company

AK Top AK Top Executive Executive Estab.

Estab. Empls.

Empls.

Design Alaska Inc. 601 College Rd. Fairbanks, AK 99701 Phone: 907-452-1241 Fax:907-456-6883

Jack B. Wilbur, Pres.

DOWL HKM 4041 B St. Anchorage, AK 99503 Phone: 907-562-2000 Fax:907-563-3953

Stewart G. Osgood, Pres.

Doyon Emerald 670 W. Fireweed Ln., Ste. 200 Anchorage, AK 99503 Phone: 907-258-8137 Fax:907-258-8124

Troy Johnson, Pres./Gen. Mgr.

EDC Inc. 213 W. Fireweed Ln. Anchorage, AK 99503 Phone: 907-276-7933 Fax:907-276-4763

John Faschan, Pres./PE

EEIS Consulting Engineers 4400 Business Park Blvd., Ste. B-100 Anchorage, AK 99503 Phone: 907-258-3231 Fax:907-272-1288

Rick Button, PE/Pres.

Electric Power Systems Inc. 3305 Arctic Blvd., Ste. 201 Anchorage, AK 99503 Phone: 907-522-1953 Fax:907-522-1182

Daniel Rogers, PE/Pres.

Engineered Solutions Group Inc. 3305 Arctic Blvd., Ste. 201 Anchorage, AK 99503 Phone: 907-522-1953 Fax:907-522-1182

David Burlingame, PE

Services Services

1957

70

Design Alaska provides architecture; civil, structural, mechanical, fire protection, electrical, and environmental engineering; landscape architecture; and design/ construction survey. The firm also provides LEED design and commissioning services.

1962

200

Civil, geotechnical and environmental engineering; land surveying, planning, environmental documentation, landscape architecture; permitting and construction management.

1997

20

Specialized provider of management/consulting services in the fields of program management, project, business and logistics management, IT/telecommunications, process, mechanical and civil engineering. Operational and integrity management, HSSE mgmt. systems, training, risk assessment compliance.

1980

8

Mechanical and electrical engineering.

1989

20

Civil, structural, mechanical process, process piping, instrumentation, mechanical HVAC, electrical and architecture/life safety.

1996

72

Industrial and utility electrical power systems, design engineering and consulting.

2005

56

An integrated design, engineering, construction and maintenance company serving electrical utitlities, private power producers and industrial manufacturing organizations.

mail@designalaska.com www.designalaska.com

jpayne@dowlhkm.com www.dowlhkm.com

ecg@doyonemerald.com www.doyonemerald.com

info@edc-alaska.com www.edc-alaska.com

eeis@alaska.net www.eeis.net

eps@epsinc.com www.esgrp.net

eps@epsinc.com

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

87

ABM’s 2011 Architects & Engineers Directory Engineering Firms

Company Company

AK Top AK Estab. Empls.

Empls.

TopExecutive Executive Estab.

Enterprise Engineering Inc. 2525 Gambell St., Ste. 200 Anchorage, AK 99503 Phone: 907-563-3835 Fax:907-563-3817

Kevin Murphy, Pres.

Environmental Management Inc. 206 E. Fireweed Ln., Ste. 201 Anchorage, AK 99503 Phone: 907-272-9336 Fax:907-272-4159

Larry Helgeson, PE

Franklin & Associates 225 E. Fireweed Lane, Ste. 202 Anchorage, AK 99503-2080 Phone: 907-277-1631 Fax:907-277-2939

Services Services

1991

34

Civil, geotechnical, structural, mechanical and fuels engineering; site development planning and design; hydraulic/surge and seismic analyses; API 653 and 570 inspections; surveying and mapping.

1988

9

Environmental and safety consulting and safety training.

Nelson M. Franklin, PE/Owner

1990

4

Structural engineering.

Fugro 5761 SIlverado Way Anchorage, AK 99518 Phone: 907-561-3478 Fax:907-561-5123

Scott Widness, Alaska Div. Mgr.

1994

15

Marine geophysics: geohazard, archeology, seismic, route, and inspection surveys.

Seafloor mapping: water depth and seabed mapping, pipeline route, inspection surveys, geotechnical site investigation. Support services: metocean, positioning, regulatory and environmental surveys and onshore mapping.

Garness Engineering Group Ltd. 3701 E. Tudor Rd. Anchorage, AK 99507 Phone: 907-337-6179 Fax:907-338-3246

Jeffrey Garness, PE/Pres.

1990

8

Civil and environmental engineering, general contracting, State of Alaska DBE and SBA 8(a)-certified.

Golder Associates Inc. 2121 Abbott Rd. Anchorage, AK 99507 Phone: 907-344-6001 Fax:907-344-6011

Mark Musial, Principal, Manager

1980

40

Geotechnical and permafrost engineering, groundwater development, risk assessment, mining, environmental remediation, air photo interpretation/terrain mapping and rock engineering.

Haight & Associates Inc. 526 Main St. Juneau, AK 99801 Phone: 907-586-9788 Fax:907-586-5774

Benjamin Haight, Pres./CEO

1980

7

Consulting electrical engineers.

Hasz Consulting Co. PO Box 1229 Delta Junction, AK 99737 Phone: 907-895-4770 Fax:907-895-4346

John R. Hasz, Pres.

1993

5

Mechanical and civil engineering.

ICRC 421 W. First Ave., Ste. 200 Anchorage, AK 99501 Phone: 907-561-4272 Fax:907-561-4271

Carl Williams, Pres./COO

1983

36

Construction program and project management for infrastructure development projects, construction management, planning construction, conceptual design, civil and environmental engineering, permitting, public involvement, health and safety administration.

Jacobs Engineering Group 4300 B St., Ste. 600 Anchorage, AK 99503 Phone: 907-563-3322 Fax:907-563-3320

Terry Heikkila, Alaska Ops. Mgr.

1993

68

Consultants providing environmental, energy, and construction services. Expertise includes: environmental compliance, assessments, and remediation; facility energy conservation re-design, O&M, and alternative/emerging energy technologies; and design-build and owners-rep construction services.

Keystone Engineering LLC PO Box 3233 Valdez, AK 99686 Phone: 907-835-8585 Fax:907-835-8585

William Wilcox, PE/Mgr.

1998

1

Civil engineering.

Langdon Engineering 318 W. 10th Ave. Anchorage, AK 99501 Phone: 907-272-1789 Fax:907-272-1790

Albert Langdon Swank Jr., PE, Owner

1980

2

Engineering: civil, structural, mechanical, electrical, nuclear, machine design, electromechanical and manufacturing processes. Scientific: R&D, nuclear physics, experimental physics, cryogenics, particle accelerators, radioactive isotopes, medical isotopes, medical imaging and nuclear medicine.

Larsen Consulting Group Inc. 3710 Woodland Dr., Ste. 2100 Anchorage, AK 99517 Phone: 907-243-8985 Fax:907-243-5629

Wallace Swanson, President/CEO

1993

20

Architecture, engineering (civil, sanitation and structural), land surveying, construction managment, construction services, construction (general contractor) and grant/funding research.

Livingston Slone Inc. 3900 Arctic Blvd., Suite 301 Anchorage, AK 99503 Phone: 907-562-2058 Fax:907-561-4528

Don Slone, PE

1975

24

Architecture, civil engineering, planning, interior design, project management, site selection and construction administration.

M-E-B Engineering Services 561 Iliamna Pl. Fairbanks, AK 99712 Phone: 907-457-1895 Fax:907-457-1895

Dennis Bolz, Owner

1989

1

HVAC and plumbing design.

MBA Consulting Engineers Inc. 3812 Spenard Rd., Ste. 200 Anchorage, AK 99517 Phone: 907-274-2622 Fax:907-274-0914

Bradley S. Sordahl, Principal, CME

1989

16

Mechanical and electrical engineering.

88

taftj@eeiteam.com www.eeiteam.com

lhelgeson@emi-alaska.com www.emi-alaska.com

swidness@fugro.com www.fugro.com

jeff@garnessengineering.com www.garnessengineering.com

www.golder.com

ben@haight-assoc.com www.haight-assoc.com

jrhasz@haszconsulting.com haszconsulting.com

info@ICRCsolutions.com www.icrcsolutions.com

www.jacobs.com

keystone@gci.net

le-m@ak.net

holly@larsen-anc.com www.larsen-anc.com

lsi@livingstonslone.com www.livingstonslone.com

mebeng@acsalaska.net

mbaconsulting@alaska.com

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

ABM’s 2011 Architects & Engineers Directory Engineering Firms

Company Company

Top AK AK Estab. Empls.

Empls.

TopExecutive Executive Estab.

Michael Baker Jr. Inc. 1400 W. Benson Blvd., Ste. 200 Anchorage, AK 99503 Phone: 907-563-3550 Fax:907-562-6468

Jeffrey Baker, Alaska Office Principal

Michael L. Foster & Associates Inc. 13135 Old Glenn Hwy., Ste. 200 Eagle River, AK 99577 Phone: 907-696-6200 Fax:907-696-6202

Michael L. Foster, PE, Owner

Monrean Engineering & Associates PO Box 9343 Ketchikan, AK 99901-4343 Phone: 907-247-5920 Fax:907-247-5918

Fred D. Monrean, PE

NANA/WorleyParsons PO Box 111100 Anchorage, AK 99511 Phone: 907-273-3900 Fax:907-273-3990

Allan Dolynny, Pres./Gen. Mgr.

NORTECH Inc. 2400 College Rd. Fairbanks, AK 99709-3754 Phone: 907-452-5688 Fax:907-452-5694

John Hargesheimer, Pres.

Northern Latitude Associates PO Box 61201 Fairbanks, AK 99706 Phone: 907-479-6370 Fax:907-479-2270

Wayne Larson, PE/Pres.

O'Neill Surveying & Engineering PO Box 1849 Sitka, AK 99835 Phone: 907-747-6700 Fax:907-747-7590

Patrick O'Neill, PE/RLS/Owner

Services Services

1942

41

Engineering: pipeline, civil, H&H, geotechnical, structural, mechanical. GIS, right of way services, NEPA and permitting support, and hydrological assessments.

1998

25

Full-service architectural and engineering firm. Planning, permitting, design and construction management.

1997

1

Civil engineering.

1997

350

Project delivery company focused on multi-discipline engineering and design, procurement and construction management services for the hydrocarbons, power, minerals, metals, infrastructure and environment.

1979

18

Environmental, civil and arctic engineering, industrial hygiene, and health and safety.

1977

1

Water and wastewater systems testing, design and inspections.

1997

3

Civil engineering and land surveying.

www.mbakercorp.com

hlm@mlfaalaska.com www.mlfalaaska.com

fmonrean@kpunet.net

info@nanaworleyparsons.com www.nanaworleyparsons.com

hargy@nortechengr.com www.nortechengr.com

northernlatitude@acsalaska.net

oneillengr@ak.net

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

89

ABM’s 2011 Architects & Engineers Directory Engineering Firms

Company Company

AK Top AK Estab. Empls.

Empls.

TopExecutive Executive Estab.

PDC Inc. Engineers 2700 Gambell St., Ste. 500 Anchorage, AK 99503 Phone: 907-743-3200 Fax:907-743-3295

Ron Gebhart, Pres./Principal

PM&E Services LLC 4011 Romanzof Cir. Anchorage, AK 99517 Phone: 907-222-5059 Fax:907-245-3489

Damien Stella, Principal

PND Engineers Inc. 1506 W.36th Ave. Anchorage, AK 99503 Phone: 907-561-1011 Fax:907-563-4220

David Pierce, PE, Pres.

Polarconsult Alaska 1503 W. 33rd Ave., Ste. 310 Anchorage, AK 99503-3638 Phone: 907-258-2420 Fax:907-258-2419

Earle Ausman, Pres.

Quest Engineering Inc. PO Box 210863 Anchorage, AK 99521 Phone: 907-561-6530 Fax:907-770-5511

Marc Cottini, PE/Owner

R&M Consultants Inc. 9101 Vanguard Dr. Anchorage, AK 99507-4447 Phone: 907-522-1707 Fax:907-522-3403

Bret Coburn, CEO

R&M Engineering Inc. 6205 Glacier Hwy. Juneau, AK 99801-7906 Phone: 907-780-6060 Fax:907-780-4611

Michael C. Story, PE/Pres.

R&M Engineering-Ketchikan Inc. 355 Carlanna Lake Rd. Ketchikan, AK 99901 Phone: 907-225-7917 Fax:907-225-3441

Trevor Sande, Pres.

Reid Middleton Inc. 4300 B St., Ste. 302 Anchorage, AK 99503 Phone: 907-562-3439 Fax:907-561-5319

Ken Andersen, Principal/Dir. AK Ofc.

Rockwell Engineering & Construction 2375 University Ave. S. Fairbanks, AK 99709 Phone: 907-457-7625 Fax:907-457-7620

Mark Rockwell, PE/Pres.

Rodney P. Kinney Associates Inc. 16515 Centerfield Dr., Ste. 101 Eagle River, AK 99577 Phone: 907-694-2332 Fax:907-694-1807

Rodney P. Kinney, Jr. PE/Pres.

RSA Engineering Inc. 2522 Arctic Blvd., Ste. 200 Anchorage, AK 99503 Phone: 907-276-0521 Fax:907-276-1751

Mack W. Bergstedt, Pres.

Schneider & Associates Structural Engr.

4060 B St. Anchorage, AK 99503 Phone: 907-561-2135 Fax:907-561-2136

Jeff Robertson, PE, Principal

Shannon & Wilson Inc. 2355 Hill Rd. Fairbanks, AK 99709-5326 Phone: 907-458-3103 Fax:907-479-5691

David McDowell, VP

Shaw Alaska Inc. 2000 W. Int'l Airport Rd. Anchorage, AK 99502 Phone: 907-243-6300 Fax:907-243-6301

Kim Marcus, Dist. Mgr./Principal

Siemens Industry Inc. 5333 Fairbanks St., Ste. B Anchorage, AK 99518 Phone: 907-563-2242 Fax:907-563-6139

Leverette G. Hoover, Gen. Mgr.

90

Services Services

1975

85

Mechanical, electrical, civil, environmental, structural engineering and land surveying.

1999

1

Civil design and project management.

1979

71

Civil, structural, marine, geotechnical, coastal and value engineering; sanitary/ wastewater; surveying; inspection; Q/A; cost administration; permitting; right-of-way acquisition; site remediation/pollution control; demolition consultation; and in-house work.

1978

7

Civil, electrical, environmental and energy engineering. Design/build, project management and construction management. Grant preparation and administration.

Hydroelectric design and build.

1996

3

Civil engineering and construction management.

1969

95

Civil/structural engineering, surveying and mapping, earth sciences, GIS, construction administration, materials testing and special inspection services.

1968

17

Civil, structural and geotechnical engineering; geology; land; surveying; aerial photography and materials lab.

1989

16

Civil engineering, surveying, construction materials testing and water-quality testing.

1991

7

Structural engineering, bridge design and marine engineering.

1995

12

Civil and environmental engineering. Above-ground storage tanks, site work, demolition and earth work, snow removal, driveways, foundations, septic systems, heating oil tanks, Phase I and II site assessments and contaminated sites.

1980

18

Civil and geotechnical engineering, and surveying.

1983

41

Mechanical and electrical engineering.

2000

8

Structural engineering services for buildings, specializing in building information modeling (BIM) and design build projects.

1974

50

Geotechnical and environmental engineering, and construction materials testing and drilling.

2002

75

A vertically-integrated provider of technology, engineering, consulting, procurement, pipe fabrication, construction and maintenance services for government and private-sector clients in the energy, chemicals, environmental and infrastructure markets.

1982

75

Consulting, design engineering, installation, commissioning and servicing of energy management, HVAC, mechanical, card access, CCTV, intrusion, audio, conference room, clock, paging, fire alarm and mass notification systems. Additionally, Siemens is an Energy Services Company (ESCO).

pdc@pdceng.com www.pdceng.com

dstella@gci.net

www.pndengineers.com

polarak@gci.net www.polarconsult.net

engineers@questengineers.com

astory@rmconsult.com www.rmconsult.com

rmengineering@rmjuneau.com www.rmjuneau.com

trevorsande@rmketchikan.com www.rmketchikan.com

kandersen@reidmiddleton.com www.reidmiddleton.com

rockwellcorp@acsalaska.net www.rockwellengr.com

rpka@rpka.net rpka.net

mbergstedt@rsa-ak.com www.rsa-ak.com

jrobertson@sastructural.com www.sastructural.com

eam@shanwil.com shannonwilson.com

suzanne.hall@shawgrp.com www.shawgrp.com

leverette.hoover@siemens.com www.siemens.com

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

ABM’s 2011 Architects & Engineers Directory Engineering Firms

Company Company

AK Top AK Estab. Empls.

TopExecutive Executive Estab.

Empls.

Steigers Corp.

310 K St., Ste. 200 Anchorage, AK 99501 Phone: 907-264-6715 Fax:800-935-6569

William D. Steigers, Chairman/CEO

Stephl Engineering LLC 3900 Arctic Blvd., Ste. 204 Anchorage, AK 99503 Phone: 907-562-1468 Fax:N/A

Matt Stephl, PE

Thompson Engineering Inc. 721 Sesame St., Ste. 2B Anchorage, AK 99503-6632 Phone: 907-562-1552 Fax:907-562-1530

Craig J. Thompson, Thompson VP

UMIAQ 6700 Arctic Spur Rd. Anchorage, AK 99518 Phone: 907-677-8220 Fax:907-677-8286

Richard Reich, P.E., Gen. Mgr.

USKH Inc. 2515 A St. Anchorage, AK 99503 Phone: 907-276-4245 Fax:907-258-4653

Timothy J. Vig, Pres./Principal

WHPacific Inc. 300 W. 31st Ave. Anchorage, AK 99503 Phone: 907-339-6500 Fax:907-339-5327

Lynn Bruno, Pres.

Services Services

2004

1

Full-service environmental consulting firm providing a wide range of project management, permitting, and environmental compliance services for industrial projects.

The firm specializes in managing complex environmental programs, Clean Air Act and Clean Water Act permitting.

1996

5

Civil engineering and trench-less technology.

1989

2

Electrical engineers.

1982

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Regulatory planning, stakeholder relations, architecture, engineering, surveying, geospatial analysis, response planning and operations, civil construction, logistics and full-service camps.

1972

112

Civil, structural, transportation, mechanical and electrical engineering; land surveying; airport planning and design; planning; public participation; environmental services; architecture; landscape architecture; GIS Services; haz-mat services; interior design; construction administration and LEED.

1981

65

Architecture; civil, structural, electrical and mechanical engineering; planning; survey and mapping; water resources; environmental, energy and construction services.

wdsteigers@steigers.com www.steigers.com

mstephl@stephleng.com www.stephleng.com

teco@gci.net

info@uicumiaq.com www.ukpik.com

marketing@uskh.com www.uskh.com

kjacobson@whpacific.com www.whpacific.com

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GENERAL

The Fine Art of Goal-Setting Setting written goals gives organizations an advantage

By Jim Romeo

Y

ou’ve heard it before: you have to have goals. As simple as it sounds, most of us do not have specific goals written down. If we do, we don’t maintain them by revising them as time goes by. Goal-setting can be the difference between success and failure in the business world. It is the basis of business achievement and development. Today, many businesses use proverbial goal-setting to start, grow and expand their business.

“We set a goal to double our business in the Anchorage office within one year with the same guidelines and security we have always demanded of our collateral,” says Jeff Gross, president, GOH Lending, based in Anchorage and Costa Mesa, Calif. The firm specializes in subprime lending for automobiles.

“We are a private company, and once the opportunity for secure subprime lending grew, our pool of interested investors grew, too. To maintain our high level of success while growing, we hired two new employees and expanded our network of working relationships. We began securitizing our collateral further by installing GPS devices in the cars. We’ve since reached our goal and continue to grow with new opportunity and new capital invested.”

It worked for Gross, but how would it work for you? Just how do we become more astute at setting goals, implementing them and monitoring our progress toward them?

Diane Katz is president of The Working Circle Teambuilding, an organizational consulting firm. She believes everyone should have goals that are measurable, time-bound and specific.

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In addition, she says, “if you can’t measure the goal, how will you know if the goal has been accomplished?

“When setting goals, make sure the consequences are clearly defined – both negative and positive – if the goals are met or are not met,” she adds.

“After goals are set, they should be visited at least once a quarter – informally is the best way, with a formal review every year. Keep monitoring them, talking about them – they are the focus of the organization and the employees. If changes need to be made mid-course, make them and discuss them – don’t discard them.”

Kenneth Hart is president of Cornerstone Advisors, an employee-owned and operated wealth-management firm based in Bellevue, Wash., with customers throughout the Pacific Northwest and Alaska.

Hart sees the process of goal-setting as a critical step in order to achieve results.

“In my personal experience, the process of goal-setting is every bit as important as the resulting goals themselves,” he says. “ A process of goalsetting that is repeatable engenders collaboration and buy-in across the organization, and empowers those involved in the process. That will serve you well when the uncertainties of business threaten your goals or provide an opportunity to secure a windfall. Just as one cannot consistently forecast the weather, energy prices, the size of the season’s catch, or the direction of the capital markets, uncertainties will inevitably challenge the precision of your goal-setting.

However, commitment to a repeatable process will find you prepared.”

For other businesses, goal-setting and

monitoring is the barometer of where your business is and where you want it to be. Goals represent the milestone schedule to build and maintain success.

“Setting goals is one of the most important aspects of building and maintaining a successful business. It is the best way to tell whether a business is improving and can shed light on the areas that need improvement,” says Gross. “Our network of auto dealers offers bad-credit-car-loan programs designed especially for auto, car and truck buyers – with credit problems, no credit, or subprime-auto-loan requirements. By establishing what you want to achieve, you can then concentrate your efforts.”

Gross’s company focused its business, and then sought markets to expand. They took their idea of serving the bad-credit market and, through goal-setting, expanded their reach. A goal can serve as the bridge between idea and reality – for most any type of business.

“Someone has an idea, it sounds good on the surface, seems plausible and so it often simply becomes a goal,” explains Bruce H. Butterwick, a managing member of Alaska’s Trophy King Lodge, a sportfishing resort located on the Kenai Peninsula between Ninilchik and Anchor Point. “This is not simple. The problem I often see is that goals are established before being challenged. Ideas, or possible goals, are a waste of time, money and energy and will likely fail, if not supported by detailed written assumptions – about income, expenses, capital improvements, financing and cash flow. And with those assumptions, projected monthly financial

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

statements prepared for two years to support or refute the possible goals and assumptions. This entire process is what I call developing a strategic plan, which is critical for any business and should be done annually before the new year begins. It is the road map for operating the business.”

Write it Down

Butterwick allowed us to excerpt a page from the goal playbook he used when he set out to establish his lodge. His primary goal: to develop the lodge into a complete facility for what he calls “high-end” clients.

The components of his larger goal were broken into three categories that included general as well as specific goals. His first category was people who would work at the lodge: “more educated and proficient in their jobs.”

For example, get the best and most experienced chef; reduce turnover; and keep a cohesive team geared for a fun experience with guests and staff. Then he focused on boats to be used by customers at the lodge: “larger, walk about, easy to drive, safe, easy to fish from, durable, easy to clean and repair.” He designed the boat, obtained financing, had five built at the same time for cost saving and operating efficiency.”

Other specific goals that went along with the overarching goal were: schedule and plan remodeling of the lodge; build a new fish-processing facility with walk-in freezers; upgrade available tackle and gear: upgrade the quality and function of lodge vehicles; and upgrade boat motors. Butterwick put such goals in writing and used them as a guide.

Writing your goals down may even have some empirical evidence to support it. Mark McCormack, author of “What They Don’t Teach You in the Harvard Business School,” describes research performed with Harvard Business School students in 1979. Students were asked: “have you set clear, written goals for your future and made plans to accomplish them?”

Only 3 percent of the graduates had written goals and plans. Thirteen percent had goals, but those goals were not in writing. 84 percent had no goals at all.

Ten years passed and the control

“When setting goals, make sure that the consequences are clearly defined – both negative and positive – if the goals are met or are not met.”

— Diane Katz President The Working Circle Teambuilding

group was interviewed again. This interview showed that those with written goals had very good results. Thirteen percent of the class who had goals was earning, on average, twice as much as the 84 percent who had no goals at all. The 3 percent with clear written goals were earning, on average, 10 times as much as the other 97 percent put together.

Guiding Principles

In setting goals, there are many important guiding principles. Katz advises to review your history regarding goalsetting – what has worked, what has not. Keep present circumstances and conditions in perspective and update your expectations accordingly. Review long-term goals and revise them to account for the current environment.

Don’t sacrifice the long term at the expense of the short term.

“For world-class companies, goals must be set in context of the values of the organization, its brand, its ‘nonnegotiables’, and its long-term aspired plans,” adds Hart. “If left unchecked, the pursuit of results at any cost may jeopardize the company’s long-term values at the expense of attaining a short-term victory.”

Short-term goals must not distract or derail longer term goals. Longterm goals can be long and laborious.

They require patience and persistence. It is important in pursuing them to not get discouraged.

“When you set goals, you first need to determine what area needs improvement and then you should pick realistic goals,” says Gross. “If the goal you are reaching for is too difficult, it is very easy to become less and less motivated as time passes. By properly setting your goals, you and your team remain motivated and determined to achieve them. This, in turn, builds self-confidence and leads to the ability to set bigger goals.”

Know and understand that for any goals you set – be they long term or short term, they will require constant fine tuning and tweaking to be truly achievable. “Goals will rarely be met exactly as planned – if that is the case, close is good,” says Butterwick. “Goals may take longer due to unforeseen obstacles, such as the economic chaos of the last few years and will need periodic adjustment as assumptions become clearer.”

Misunderstandings

Whenever you discuss goals, it’s important to realize there are many misunderstandings about them.

“One common misunderstanding is that you should pick outcome goals as opposed to performance goals,” says Gross. “You should set goals over which you have as much control as possible.

There will always be factors out of your control, such as the economy. Basing your goals on personal performance helps you maintain control over the achievement of your goals.”

Hart points out another common misunderstanding: business goals should be crafted in isolation from the personal quantitative and qualitative goals of the business owners.

“Especially for mature, closely held and/or family owned businesses, parallel planning for not only the success of your business but your own financial success, is paramount,” says Hart. “It’s important to pay attention to these twin goals well before you retire. Failure to plan on either front or failure to carefully orchestrate those plans in harmony with one another will often result in company’s management

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and other key stakeholders working at cross-purposes.”

So what advice should business owners take right now to improve their goals, goal-setting ability and implementation of those goals?

Writing them down can’t be stressed enough.

“Make your goals visible,” says Hart.

“Commit then to paper and post them in a place you will see every day.”

In addition, Hart emphasizes the importance of being willing to seek out and accept accountability for the goals;

get support from others to help you get there.

“Everything depends on execution, so find a mentor or set up a team of advisors to keep your feet to the fire.”

But Hart cautions to find supporters who are in concert with your objectives.

“Ensure that your team of advisors – those responsible for internal governance, outside professional experts to the business, and the trusted personal advisors to the business owners – are all on ‘the same page’ and are aligned in their incentives,” he adds.

“In my personal experience, the process of goalsetting is every bit as important as the resulting goals themselves.”

— Kenneth Hart President Cornerstone Advisors

Gross advises that goal-setting requires regular and recurrent attention.

“Spend some time brainstorming where you want your business to go and what you hope to ultimately achieve,” he says. “Then, begin selecting goals that are the most important and can be achieved within a certain amount of time. And finish by creating daily or weekly to-do lists to help determine what steps need to be taken in order to reach these goals.”

He starts from a bird’s eye view and narrows down his focus.

“I start by deciding what the big picture is for the company and what the most important large-scale goals are,” he says. “To make these larger goals more manageable, I break them down into a list of smaller, short-term goals.

We then begin working toward these goals and are constantly reviewing and updating this list.”

Whatever method you employ, goalsetting can work if done right. Without written goals, you’re liable to run astray and not get where you want to go or achieve what you want to achieve.

“If you don’t know where you are going,” said Yogi Berra, “you’ll end up somewhere else.” q Jim Romeo is a freelance writer (www.JimRomeo.net) based in Chesapeake, Va. He writes about business and technology topics.

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Health & Medicine

Providence Residency Program: Training Doctors Patients get inexpensive but professional care Photos by Tracy Kalytiak

Dr. Anne Musser performs neck manipulations on patient Nahama Naomi at Providence Family Medicine Clinic.

By Tracy Kalytiak

A

nne Musser first traveled to Bethel for two cold, dark winter months when she was a medical student eager to hone her new skills.

“I just fell in love with Alaska,” said Musser, an osteopathic family physician originally from California. “As a medical student, I got to go by small plane and snowmachine out to some of the villages to see people, collect injured people. It’s just a fantastic state – a wonderful place to be a family physician.”

Twenty-seven years later, Musser works as assistant program director for Providence’s Alaska Family Medicine

Residency program, which provides its resident doctors experience in clinic settings in Anchorage, as well as weekslong opportunities to practice family medicine in places like Dillingham and Bethel. Providence accepts 12 residents for each year in its three-year program.

“In the Lower 48, family practice has been sort of watered down; in many places we don’t get to practice everything we’ve been taught,” Musser said.

“Up here, we really have a much broader scope of practice and it’s rewarding.”

Family Care For All

The base for the residency program is

Providence’s $5 million Family Medicine Clinic, an L-shaped building located on 36th Avenue in Midtown, which received three-fourths of its funding from a federal grant obtained by the late U.S. Sen. Ted Stevens.

The clinic opened in 2001 and logs 30,000 outpatient visits each year, Musser said. It is one of two clinics in the Anchorage area that continues to accept new Medicare patients. The facility provides office and classroom space for the 36 residents and 12 fulltime faculty members, as well as health care for underserved, uninsured and underinsured patients. Providence

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sponsors the program, which is academically affiliated with the University of Washington.

The building contains 32 exam rooms, nurses’ stations, medical assistant stations, X-ray and laboratory services. Doctors in the community donate their time to oversee the clinic’s specialty clinics, which offer such services that include rheumatology and podiatry. “(Residents) get to learn about lab tests – what’s done, how to order tests, what types of specimens are required

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for different tests,” the clinic’s laboratory supervisor, Angie Hamill, said.

It was created in 1997 by State leaders and a consortium of physicians led

by Dr. Harold Johnston, the program’s director, with the intent to train family physicians for the unique aspects of practice in the most remote parts of the state.

They brought together people from 25 so-called hubs of care – larger communities like Barrow, Bethel and Dillingham – and talked to physicians there about problems they had

recruiting doctors. The communities needed doctors who could offer a full range of health care services, including emergency medicine, orthopedic, obstetrics, psychiatry and pediatrics.

Well-Rounded Residents

“Those were the things people currently practicing in those areas felt there was a real need,” Musser said.

“They found out from that group of people that probably, above all, residents needed to have experience living and working in those kinds of areas.”

Initially, the program accepted eight residents for each of its three years. In 2004, it accepted 10 applicants for each resident year and then expanded to 12 for each year.

Musser said they interview between 60-70 people a year for the 12 slots.

“It kind of attracts a unique group of people,” she said. “They’ve got to be thinking, ‘Hey, I’d like to practice in Alaska.’ We have an amazingly strong applicant pool.”

Applicants often have had some international experience, by doing missionary work or working for the Peace Corps.

“These people have experienced life not just for weeks, but for months and years, in areas that are just so unbelievably different than what they grew up in,” Musser said.

The residency program is accredited by both the Accreditation Council for Graduate Medical Education (MDs) and the American Osteopathic Association (DOs).

“I think the overarching theme is the physicians who are practicing in those rural areas are almost exclusively family physicians practicing with a skill-set to take care of everything,” Musser said.

Something that surprises Musser is that some people with insurance don’t think of choosing a family physician at Providence Family Medicine Clinic because it is a training program and because it is considered a safety net for those who don’t otherwise have access to health care.

“I think that’s too bad because I think that actually we’re probably one of the strongest family practices in the city, in the Anchorage area, because we have residents and so we’re

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always on top of the latest thing in medicine,” Musser said. “We have the nice combination of experienced faculty who have come from all over to practice here and we have young and enthusiastic residents. That combination really makes it a strong, positive, best-practice kind of a place.”

Residents receive training not only in medical and osteopathic health care, but also in transcultural medicine. They attend sessions about Russian, Hmong and other cultures, treating an incarcerated patient, wilderness survival and so-called integrative medicine topics, including acupuncture, reiki, chiropractic and yoga.

Plans are under way to form psychiatric and pediatric residencies, Musser said.

“Anchorage just doesn’t have enough psychiatrists to take care of the mental health issues in the community,” Musser said. “It’s a hard specialty to recruit.”

Curriculum is being developed and logistics for the future programs are being worked out, Musser said.

“The basic idea and the locations and

Juliana Shields and Joseph Prows both work as residents at Providence Family Medicine Clinic.

the tracks are pretty well laid out,” she said.

“One starts in 2012 and the other, 2013.”

Learn Here, Stay Here

Musser says Providence’s Family Medi-

cine residency program has graduated 98 people since 2000. Of those, she said, between 75 percent and 80 percent remained in Alaska; 50 percent of the graduates practice in rural communities.

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“That’s huge,” she said. “According to the Association of American Medical Colleges, Alaska has the highest rate of people training in our state and then deciding to stay and practice here.”

Joseph Prows is one resident who believes he will likely remain in Alaska.

As a child, Prows hoped to be a veterinarian someday. He changed course later, planning to delve into environmental law, but then decided medicine was a better fit.

“I thought I’d be good at it because of what my skill-set was,” Prows said.

Prows took off a year between college and medical school and spent time in Ketchikan, where he met his future wife. He learned about Providence’s residency program in 2006.

“I wanted to come back here; this was the only program in the state,” he said. “This program trains you to be independent, to be able to practice medicine without much support in a rural place. They want their residents to put down roots in rural, underserved places. I went out to Bethel and I’ll go to Nome and Unalaska next year.”

Residents have access to medical specialists of all types during their time in the program, gaining experience in a wide spectrum of specialties.

“Today when rounding in the hospital, I had contact with three specialists: a surgeon, cancer specialist and a specialist in infectious diseases,” Prows said. “It’s neat having that kind of exposure. It’s very helpful in your training.”

Prows recently helped a woman whose heart stopped beating in a hospital’s emergency department.

“They called a ‘code.’ I was the first one there and started doing chest compressions,” he said. “We did 15 minutes of compressions, shocks and medicines.”

The woman was admitted to Providence’s intensive care unit.

Prows provided medical care to the patient and support to her family. The following day, the woman’s condition had improved so much Prows could remove the tube used to aid her breathing.

“That was an amazing feeling, to be involved from the very begin-

ning through to the end,” he said.

Another time, Prows treated a pregnant, drug-addicted prostitute infected with hepatitis C. Two-anda-half months before she was supposed to give birth, the woman was experiencing contractions and a lifethreatening condition in which the placenta grows too close to the cervix.

“The baby can’t be delivered normally,” he said. “There has to be a C-section because the mother and baby could bleed to death. It’s a horrible emergency.”

Prows treated the woman for withdrawal, which can trigger contractions, gave her fluids and tried to prevent her from delivering until steroids could hasten maturation of the unborn baby’s lungs. That baby survived and is now in State care. The baby’s mother is pregnant again.

“We see a lot of scary and profane and beautiful moments in life. It’s tough to be shocked anymore,” he said. “If someone at the supermarket fell over unconscious in front of me, I feel my pulse would not rise. I’d be thinking, ‘This is what I need to do.’” q

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

Orthopedic Medicine

Alaskans Have Many Options

Most stay in Alaska for health care

By Vanessa Orr and the North Slope,” said Schumacher.

“There really isn’t a part of Alaska from which we haven’t treated patients.”

“We get patients from all over Alaska, including the Bush, Fairbanks and Juneau areas,” adds Kris Keddington, physician liaison, Orthopedic Physicians of Anchorage. “And as a courtesy to our patients who live outside of Anchorage, we also have one of

our surgeons travel to Seward once a month to see patients there.”

Some patients from rural Alaska routinely choose Alaska Regional, according to its director of Orthopedic and Rehab Services, Rosemary Kline, RN, who added that patients have come from as far away as New York after researching successful jointreplacement programs.

Photo courtesy of Anchorage Fracture and Orthopedic Clinic

O

rthopedic injuries affect people of all ages. From sports injuries sustained in school, to fractures earned by weekend warriors, to joint injuries caused by aging – finding the right orthopedic physician can make a big difference in a person’s recovery.

In the past, residents of the Last Frontier often chose to go outside of the state to receive the care they needed. But times have changed, as has the practice of orthopedics in Alaska. “I think that there was a time when people routinely went to Seattle for bigger procedures, but those times are gone,” explained board-certified orthopedic surgeon and board-certified sports medicine specialist Gregory L. Schumacher, MD, a physician at Anchorage Fracture and Orthopedic Clinic (AFOC). “Alaska has high-quality health care. Aside from a very few conditions like bony cancers (cancerous tumors related to the bone), which is an extremely rare condition, there’s really no reason to go south anymore.”

In fact, people come from all over the state to go to orthopedic practices in Anchorage, including Alaska Regional Hospital’s Orthopedic and Spine Center, Anchorage Fracture and Orthopedic Clinic and Orthopedic Physicians Anchorage (OPA).

“I’ve been very impressed with how widespread our patient base is; we see a tremendous amount of patients from the Prince William Sound area, and we routinely see patients from Barrow Gregory L. Schumacher, MD Board-Certified Orthopedic Surgeon Board-Certified Sports Medicine Specialist Anchorage Fracture and Orthopedic Clinic

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99

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Photo courtesy of Alaska Regional Hospital

Musculoskeletal Disorders

There are many reasons to see an orthopedic physician and many options for treatment.

“At Alaska Regional’s Orthopedic and Spine Center, we treat a wide range of patients from pediatric to geriatric, whose conditions include joint deterioration, acute and chronic back pain, trauma and fractures,” said Kline. “Our staff works together with the goal of understanding the unique needs of each individual patient and their loved ones in tailoring the treatment so they may return to an active lifestyle.”

Alaska Regional’s Orthopedic and Spine Center specializes in spinal procedures, total shoulder and total jointreplacement surgery, including hips, knees and ankles. “Although we treat all types of orthopedic conditions, our spine procedures have increased dramatically over the past couple of years,” said Kline. “We offer both inpatient and outpatient procedures, including surgical and nonsurgical interventions for spinal conditions.”

According to Kline, Alaska Regional was first in the state to offer artificial cer-

At a joint camp session, David Jensen, an employee with Alaska Regional’s Therapy Services Department, talks with prospective joint-replacement patients about the rehabilitation process.

vical and lumbar disc replacement for treatment of degenerative disc disease.

The practice also performs many procedures of the neck, thoracic and lumbar spine, as well as minimally invasive procedures including microdiscectomies, kyphoplasty, steroid injections and pain-reducing stimulators that enable patients to be discharged shortly after surgery. “These procedures allow patients to experience a speedier recovery with fewer complications,” said Kline.

Alaska Regional also started an orthopedic joint program in 2003, which includes Joint Camp, an important part of the healing process that begins before the patient goes in for surgery.

“Joint Camp is a free program that invites patients, families and their caregivers into the hospital to learn about their surgery and what disciplines will be involved in their care,” said Kline.

“It addresses topics like pre- and postoperative exercise plans, post-operative assistive device needs, home safety preparation and expectations before and after surgery.”

At Anchorage Fracture and Orthopedic Clinic, 12 fellowship-trained specialists cover every aspect of orthopedics. “As far as I know, we are the only group in the area that manages hips arthroscopically,” said Schumacher. “It is becoming more prevalent to treat hips using a scope and we have a very brisk practice in this area.

“Joint replacement has become much more reliable over the years,” he added, “and we are now seeing a tremendous amount of people with arthritic joints who respond very well to this treatment. Our highly qualified joint surgeons do a substantial percentage of the revisions in town, which speaks to their expertise.” Revision work is the replacing of a joint that has already been replaced and has worn out as a result of age or use.

Alaska Fracture’s sports medicine specialists, who work with the U.S. Ski Team and have served the University of Alaska Anchorage sports teams for more than 20 years, also perform a lot of shoulder procedures, which are mainly done arthroscopically. “We’re moving away from surgeries that require large incisions, though of course outcomes are still our number one measure of success,” said Schumacher. “We are seeing better outcomes with more advanced technology.”

AFOC has its own rehabilitation center within the same building, and provides therapy for all orthopedic conditions, including upper extremity therapy and focused hand therapy. “Our therapists are a really high-speed, athletic bunch who can relate to our patients because they speak from experience,” said Schumacher. “They’ve had sports injuries in the past, so they can walk the walk, taking our patients from a post-op or post-injury state to recovery.”

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Orthopedic Physicians of Anchorage also has a number of fellowship trained surgeons on staff, including a foot and ankle surgeon, upper extremity surgeon and two spine surgeons.

“One of the really unique services we offer is our walk-in clinic, which is open seven days a week, including holidays,” said Keddington. “We were the first orthopedic office to open an acute injury musculoskeletal walk-in clinic where patient can be seen with no referrals or appointments. The can come straight in to see us and get assessed, saving themselves the waiting and expense of an emergency room.”

Raising the Standard of Care

Orthopedic practices in Alaska continue to raise the bar when it comes to providing patient care. In August 2010, Alaska Regional Hospital was featured in U.S. News & World Report’s “2010-2011 Best Hospitals” study as the 47th best hospital in the country for orthopedics. The study evaluated nearly 5,000 hospitals for 16 adult specialties ranging from cancer to urology, and Alaska Regional is the only Alaska facility listed in the top 50 hospitals for any of the 16 specialties.

“We believe that it is our emphasis on patient education, individualized care and our specialized care team that contributes to our patients’ positive outcomes after surgery,” said Kline of the hospital’s rating. The hospital was also rated No. 1 in Alaska for overall orthopedic services for three years in a row by HealthGrades, an independent health care rating organization that provides quality ratings and profiles of hospitals, nursing homes and physicians. It also ranked Alaska Regional No. 1 in the state for joint replacement for five years in a row, and gave it a five-star rating for three years in a row for joint replacement and total knee replacement.

Alaska Regional recently upgraded its MRI system to support physicians in diagnosing and providing optimal patient care through a new system that offers increased speed, better resolution and unique applications.

And Orthopedic Physicians of Anchorage has been a chartless practice since 2006, putting it at the forefront of electronic medical record (EMR) use.

“Having electronic medical records

benefits patients because we have all of their information at our fingertips at all times,” said Keddington. “Everything is automatic as far as getting information from patients’ charts; there’s no waiting while we search a paper trail.”

While all of these practices have much to offer, what’s most important is how a patient feels about how they fit with an orthopedic group. “First and foremost, talk with a prospective physician to see if it’s a good fit,” said Schumacher. “You want to develop a relationship with your orthopedic

doctor, and make sure he or she understands your goals.

“Feel free to ask about the number of procedures that they do in a certain area – a lot of people are bashful about this, but it’s always a fair and appropriate question,” he added. “And it’s always okay to talk about other options; surgery is not the only option available. Any responsible doctor will discuss all of a patient’s options, from doing nothing up to doing a surgical intervention, and let the patient come to his or her own conclusion.” q

Making the top 50 “best hospitals” is

being the only alaska hospital on the top 50 list is

big.

better.

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.

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Oil & Gas

Eni at Nikaitchuq

Offshore oil field work continues

Photos by Judy Patrick Photography

Barge 455 3 breaking tow and passing the barge to the shallow-draft-assist tugs off Point Oliktok with the Eni module.

By Mike Bradner

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n the Inupiat language of the Arctic Slope the word Nikaitchuq means “persevrence,” David Moles, senior representative for Eni Oil and Gas in Alaska, told the Resource Development Council last November. It is a quality that Eni, Alaska’s newest oil developer, has had to have in abundance, Moles said, as the company worked to overcome the challenges of its new offshore oil field on the North Slope.

It was named, appropriately, Nikaitchuq. Eni, headquartered in Italy and new to Alaska, has had to learn its way through all the usual problems of developing a new project on the North Slope, and also to overcome the technical challenges posed by heavy, viscous quality of the oil, Moles said. The State of Alaska has stepped in to assist Eni with this technically challenged project with a reduction in the State royalty, which was negotiated with the Department of Natural Resources.

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Eni isn’t the first newcomer to break its way into the exclusive Slope producer club. That honor goes to Pioneer Natural Resources Co., a major independent. But as a major company entering the North Slope, Eni brings a depth of engineering and technical know-how that it is using on the unique problems of Nikaitchuq.

Heavy Crude, Hard Flow

The biggest of those is that the viscous oil, a type of heavy, thick crude that is cold and difficult to produce. Eni’s strategy, Moles told the RDC, is to produce the oil, which flows like thick syrup, with a massive injection of hot water to loosen it up. It this works as hoped, and the oil flows, it could encourage more development of the massive viscous and heavy oil resources of the Slope.

Even in its first phase, Nikaitchuq is putting its imprint on Alaska. It is a $2 billion project, and this past year

Eni employed about 500 contractor workers in drilling and construction as well as more than 90 Eni employees split between Anchorage and the North Slope. It was one of two major new projects under way on the North Slope in 2010, the other being ExxonMobil Corp.’s Point Thomson gas-condensate project.

It was a slow year for oil activity and the state’s petroleum support industry was glad to work with Eni. Eni isn’t well known in Alaska yet, but it is known elsewhere, Moles told the RDC. The company has 78,000 employees worldwide and operates in all of the world’s oil-producing regions. Interestingly, the company is “horizontally” as well as “vertically” integrated, which means, in traditional vertical integration, that Eni has the usual “upstream” oil and gas production as well as the “downstream” refining and marketing.

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

Known Worldwide

The “horizontal” part, which is unusual, is that Eni also owns companies engaged in various aspects in support of the core business. For example, Eni has companies supporting its upstream work that do the engineering, fabrication and construction of production facilities, usually in offshore, for the parent company. In most of the industry these days, these kinds of functions are contracted out. Most of this work by Eni companies is concentrated in Europe. In the Gulf of Mexico, where Eni has been active for some time, and Alaska, where it is recently active, the traditional practice of contracting out for support work has been followed.

Eni came to Alaska in 2006 as a minority partner in several exploration ventures. Armstrong Oil and Gas and Kerr McGee had first developed the Nikaitchuq project and Armstong, which primarily sees itself as an explorer, sold its 30 percent share to Eni, with Kerr McGee remaining as 70 percent majority owner and operator of the project.

At the same time Eni took a minority ownership stake with Pioneer Natural Resources in the Oooguruk project that adjoins Nikaitchuq and which is now producing. Also Eni partnered with Armstrong on exploration onshore, in an area south of the producing Prudhoe Bay and Kuparuk River fields.

No Gas, But Wait!

The onshore exploration venture with Armstrong did not pan out, Moles explained, but Eni remains a 30 percent partner with Pioneer in Oooguruk.

Meanwhile, Kerr McGee sold its stake in Nikaitchuq to Eni, giving the company total ownership of the project.

Eni also has a stake in the Beaufort Sea federal Outer Continental Shelf leases in partnership with Shell and Repsol, the Spanish oil company.

When it was operator Kerr McGee drilled two wells on the Nikaitchuq prospect, one an exploration well that found oil and the second a delineation well to confirm the extent of the oil-bearing reservoir. The wells were flow-tested and based on those results a plan to produce the field was developed. The plan eventually developed

by Eni foresees 52 wells including

Barge Marty J arriving at Point Oliktok with the second Eni module.

26 producing wells, 21 water-injection wells and two disposal wells, one onshore and one offshore, to inject waste materials back underground.

The field will be developed in two phases, the first from on onshore production pad and processing facility built at Oliktok Point, and the second, later, phase from an artificial production island built offshore in shallow water near Spy Island, a natural barrier island. The company decided to build a separate, artificial island rather than to use the Spy Island so as to not disturb the natural island.

As of late 2010, as startup of the field neared, Eni had drilled seven wells from its onshore pad, including one injection well and one disposal well.

The onshore facilities were complete and ready for the start-up, including a camp for housing employees and support workers. Plant modules were delivered by sealift in the summer and the hook-ups completed in November. Civil construction for the offshore production island was also completed in 2010. A rig will be moved to the island in mid-2011 to begin drilling the offshore production wells, Moles said.

Complex Problems Delayed Project

Eni had originally planned to build and complete Nikaitchuq in 2009 and to start up the field in early 2010, but the complex engineering required for

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

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the process plant because of the viscous oil created delays to the point that Eni would miss the date for the 2009 summer sealift sailing. Given that, the company decided to push the whole project back a year. Construction resumed in 2010.

Although the main module units were built in fabrication yards in the U.S. Gulf of Mexico, there were still a lot of smaller components fabricated in Alaska last year, and that work continues in 2011 as Eni continues construction of the offshore production pad, Mole said to the RDC. There’s little doubt that Eni faces some tough challenges making a go of it with Nikaitchuq. The main prospect the company is tapping is the pool of viscous oil that is shallower, cooler and thicker than the viscous oil now being produced a few miles to the south by BP from the Schrader Bluff deposit in the Milne Point field, and ConocoPhillips in the West Sak deposits of the Kuparuk River field.

Those deposits are deeper than the viscous oil at Nikaitchuq, which makes the oil a bit warmer and easier

to produce, and the Schrader Bluff and West Sak viscous oil appears to be a bit higher quality than the viscous oil at Nikaitchuq.

New Ways

Eni is tackling these problems with some new approaches, however. As Moles explained to the Resource Development Council in November, the company will produce briny water at a high temperature from a deeper reservoir and inject it into the shallower viscous oil reservoirs. The water will raise the temperature of the heavier crude in the rock and push it toward the producing wells.

One of the other challenges with viscous oil is that as the oil is produced from the reservoir the rock around the wells tends to crumble, allowing sand to enter the oil and flow up the wells.

Handling the sand has been one of the biggest problems all the North Slope companies working on viscous oil have faced. Various solutions were tried over the years, including keeping the sand out of the wells with screens.

At Schrader Bluff, BP is allowing

the sand to come up the well with the oil, and then separating the sand and disposing of it on the surface.

However, this has created challenges in operating the large oil- and gasprocessing plants where viscous oil has been mixed with conventional crude for processing. The sand also is believed to have contributed to corrosion in field pipelines.

Eni is approaching this a different way by building its own processing facility at Oliktok Point, designed to handle the viscous oil. The sand, which is actually like flour in its consistency, is injected back underground in the disposal well Eni will also operate at the Oliktok Point plant site.

BP and ConocoPhillips are considering building separate processing plants for their viscous oil rather than continuing to process the oil and its sand at the existing plants (which were designed for conventional crude processing), but Eni is the first to actually do it. The lessons Eni learns with the Nikaitchuq plant will no doubt be put to work on other North Slope viscous oil development. q

907.278.1877

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

Oil & Gas

Photos by Judy Patrick Photography

Barge 455 8 with the Doyon drill rig ready to begin discharging cargo at West Dock 2, Prudhoe Bay.

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rowley’s high-deck-strength series deck barges, 455-8 and 4557, delivered a Doyon drill rig to Prudhoe Bay in August 2010 to support BP’s North Slope drilling operations.

The rig, which is capable of working efficiently in extreme Arctic conditions, was originally loaded on the sister barges in the Columbia River in Vancouver, Wash., then towed to the site by tugs Gladiator and Guardsman.

Barge 455-7 carried eight pieces of the drilling complex, consisting of 32 rig mats and totaling more than 4.3 million pounds, while barge 455-8 carried four pieces, consisting of 30 rig mats and totaling more than 3.6 million pounds.

Doyon board members and administration participated in a commissioning ceremony on the North Slope Oct. 25 for Rig 25, which subsidiary Doyon Drilling Inc. built. The rig is the eight rig owned and operated

by DDI.

Crowley moves Doyon Rig 25 Spotlight on the North Slope

SOURCE: Crowley Maritime Corp. and Doyon Ltd. www.akbizmag.com • Alaska Business Monthly • February 2011

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Oil & Gas

ABCs of State Lease Sales From promise to fruition

By Mike Bradner

Photo by Dimitra Lavrakas

The February 2008 lease bid sale of 2.8 million acres in the Chukchi Sea above the villages of Barrow, Wainwright, Point Lay and Point Hope raised a record $2.6 billion. Minerals Management Service Director Randall B. Luthi gives opening remarks.

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t statehood, Alaska was given a generous endowment of 103 million acres of land by the federal government, the idea being that the young, new state could use the lands, believed then to have undiscovered natural resources, to support itself.

Petroleum was the most likely resource to be developed with potential for paying substantial revenues, although Alaska had also long had a mining industry. The discovery of oil on the Kenai Peninsula in 1957 by Richfield Oil Co. gave congressmen, who were reluctant

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about Alaska’s ability to financially support a State government, the confidence to go ahead and approve statehood.

The concept of a land endowment supporting the state has been a brilliant success. The new state began a program of lease sales, auctioning off the exploration rights to its lands. Since the early 1960s, the leasing of State lands for petroleum development has generated the income that has paid for State government (this year alone oil pays for 87 percent of the State budget). And for the last 40 years, Alaskans have been able to live in a relatively tax-free environment.

Mechanics in Motion

The mechanics of those lease sales, and the leases themselves, have some interesting aspects. There were also some early policy calls by Alaska leaders that were to have important repercussions. And, some of the issues developed from the leasing over the years are still somewhat unresolved, some of the most important being the work commitments and responsibilities for the leaseowners to be diligent about pursuing development. Two cases in point are the recent litigation over State leases at Point Thomson, an area east of Prudhoe Bay where ExxonMobil

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

February OCS Lease Sale Public Scoping Meetings BOEMRE Plans Meetings on the Draft Environmental Impact Statement for Proposed 2012-2017 Outer Continental Shelf Oil and Gas Leasing Program: New Public Comment Period Extends to March 31, 2011 WASHINGTON – The Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE) today announced that it will hold a series of public scoping meetings in February 2011 on the Programmatic Environmental Impact Statement (PEIS) for the proposed 20122017 Outer Continental Shelf (OCS) Oil and Gas Leasing Program. The public notice is available for public inspection through the Federal Register’s website at www.archives.gov/ federal-register/public-inspection/index.html.

On Dec. 1, 2010, Secretary of the Interior Ken Salazar announced an updated oil and gas leasing strategy for the OCS and identified the areas that would be considered for environmental scoping for the 2012 - 2017 program (www.doi.gov/news/pressreleases/ Salazar-Announces-Revised-OCS-Leasing-Program.cfm). The final PEIS will cover areas in the Central and Western Gulf of Mexico along with a small portion of the Eastern Gulf that was set aside by the Gulf of Mexico Energy Security Act for Lease Sale 224. Additional areas to be considered are Alaska’s Chukchi and Beaufort Seas and Cook Inlet.

“As we look to the future and identify areas to offer for oil and gas development under the next five year program, we will make decisions based upon the best scientific information available,” BOEMRE Director Michael R. Bromwich said. “We strongly encourage public participation in this process to ensure we are reviewing all of the relevant and important information about these areas. This PEIS will inform our decisions on when and where to offer leases and will help identify specific requirements that may be needed to ensure potential risks to the environment are appropriately managed and mitigated.”

The PEIS public scoping meetings are scheduled as follows: • Monday, February 14, 2011, 7:00 p.m. – Kotzebue Middle-High School, 744 Third Avenue, Kotzebue, Alaska.

• Tuesday, February 15, 2011, 1:00 p.m. – Houston Airport Marriott at George Bush International, 18700 John F. Kennedy Blvd., Houston, Texas.

• Tuesday, February 15, 2011, 7:00 p.m. – Point Hope School Library, Point Hope, Alaska.

• Wednesday, February 16, 2011, 1:00 p.m. – New Orleans Airport Hilton, 901 Airline Dr., Kenner, Louisiana.

• Wednesday, February 16, 2011, 7:00 p.m. – Point Lay Community Center, Point Lay, Alaska.

• Thursday, February 17, 2011, 1:00p.m. – Five Rivers-Alabama’s Delta Resource Center, 30945 Five Rivers Blvd., Spanish Fort, Alabama.

• Thursday, February 17, 2011, 7:00p.m. – Alak School Library, Wainwright, Alaska.

• Monday, February 21, 2011, 7:00 p.m. – Inupiat Heritage Center, Barrow, Alaska.

• Tuesday, February 22, 2011, 7:00 p.m. – Nuiqsut Community Center, Nuiqsut, Alaska.

• Wednesday, February 23, 2011, 7:00 p.m. – Kaktovik Community Center, Kaktovik, Alaska.

• Thursday, February 24, 2011, 1:00 p.m. – Washington Dulles Airport Marriott, 45020 Aviation Dr., Dulles, Virginia.

• Friday, February 25, 2011, 7:00 p.m. – BOEMRE Alaska Region Office, 3801 Centerpoint Dr., Anchorage, Alaska.

In addition to the scoping meetings, the public may submit written comments on the PEIS until March 31, 2011, via mail, to: J. F. Bennett, Chief, Branch of Environmental Assessment, Bureau of Ocean Energy Management, Regulation and Enforcement, 381 Elden Street, Mail Stop 4042, Herndon, Virginia 20170-4817, or online at http://ocs5yeareis.anl.gov.

Information concerning the leasing program and PEIS can be accessed online at www.boemre.gov/5-year/.

Source: U.S. Department of the Interior

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

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Corp. and its partners have made gas discoveries, and in Cook Inlet where a small independent oil company, Escopeta Oil and Gas Co., has had to seek extensions of its State offshore leases because of difficulties in lining up a “jack-up” rig to drill exploration wells.

In both of these cases the State had to press the lessees to fulfill lease obligations, although the leaseholders argued there were extenuating circumstances.

Some lease sale mechanics: In theory, leasing land for oil and gas development is not a lot different than any landowner renting or leasing land for commercial purposes. The lease has a term, after which there can be options for renewal.

There are also provisions for lease cancellation if there is no performance by the leaseholder. There are various forms of payment to the landowner. In Alaska and most U.S. states (and many foreign nations) where the leasing model is used, the most common payment provision is a royalty, or a share of the income or production to the landowner. In Alaska, and elsewhere, there are also annual rental payments for the leases and, also important, usually some form of up-front

cash bonus payment paid to the landowner by the lessee.

Alaska law also allows for the royalty to be in a share of production net profits, as well as the traditional gross revenue form of royalty, and some leases issued by the State in the past have had both the conventional gross revenue royalty, as well as the net profit share. Alaska law also allows the State to have net profits bidding in a lease sale as an alternative to the conventional up-front cash bonus, but the one experiment with this type of bidding in 1979 created some problems and it has not been used since.

In-Kind, In-Value

An important feature of Alaska’s oil and gas leases is they allow for payment of the royalty to be made “in-kind,” or in the physical form of oil or gas, as an alternative to payment “in-value,” or in cash. In its leases the State is given the ability to switch, at six months’ notice, from receiving its royalty in-value to being paid the royalty in-kind, or production. This feature in the lease is unusual although some other govern-

ments have similar features in leases.

The royalty in-kind feature has given Alaska important flexibility. For example the State has been able to supply independent refineries in the state with State royalty crude oil. The ability for the State to do this was crucial in the refiners’ decisions to build plants in Alaska in 1968 and 1975 and 1976.

Alaska also uses a model of competitive-bid leasing similar to that used in many states and the U.S. government for federal lands. The procedure is relatively straight-forward in that the government lays out of the basic terms of a lease such as the royalty, including the in-kind provision, the rental terms, the work commitment and the term of the lease, and then auctions the lease to the highest bigger in a closed-bid lease sale. The bidder submitting the highest cash bid gets the lease.

This isn’t the only model of leasing the State can use. In the early days of statehood the State considered a “noncompetitive” form of leasing, similar to that used at the time by the federal government in its Alaska leasing. In this system the state sets out the royalty, the rental, the lease term and other fixed provisions in the lease, but selects the winners by some means other than cash bonus bidding, typically some form of lottery. When it used this system in the 1960s, the federal government used a lottery where the winners were selected at random out of a basket.

Alaska’s decision to use competitive bonus-bidding is seen now to have been wise, and successful but the State did consider using the noncompetitive lottery-style leasing method in some of its early North Slope lease sales of the 1960s.

Differences Reviewed

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An important difference in the two approaches is that competitive cash-bonus bidding gives the advantage to major oil and gas companies that can muster to financial resources to make the bids.

Individuals are at a disadvantage, as are smaller companies. The major argument for the noncompetitive approach was it allowed for individuals and smaller firms to become leaseholders, and while many of these would wind up selling their leases to larger companies – the diversity of the landholding and the competition induced by numbers www.akbizmag.com • Alaska Business Monthly • February 2011

of landowners pursuing development, were seen as worthy goals.

That this also allowed individual Alaskans a chance at winning an entry ticket into oil leases and getting financial benefits, made noncompetitive leasing popular with the public and many State legislators. The chief argument against competitive-bonus bidding is that this system allowed large companies, or anyone with lots of money, to outbid competitors and tie up large amounts of acreage, shutting out competitors.

The advantages of the competitivebonus bidding system, on the other hand, were seen as the best way to bring in large, experienced companies with the resources and capabilities of actually developing oil and gas fields in remote or costly environments. What was attractive to State officials was that this system also produced money immediately for the State treasury. In the 1960s, this was a major concern for the new State government.

The bonus bids made by oil and gas companies in the early Cook Inlet lease sales were, in fact, essential in providing revenues that the State was unable to

raise by levying more taxes on its small population. The State’s heavy reliance on cash bonus bids for operating revenue prompted criticism that the State was moving too quickly in its leasing, just to get the bonus money to support the government. Interestingly, there were also the first arguments made for setting aside some of the oil bonus money in a savings account, an early version of the Permanent Fund idea.

Prudhoe at Last

The most dramatic example of the benefit of the bonus-bid leasing method to the young state came in September 1969 when the State received $900 million for leases sold in the Prudhoe Bay area. The main Prudhoe Bay discovery had been announced earlier that year (the State had held the original Prudhoe Bay lease sales several years earlier) but now other companies in the petroleum industry was in a frenzy to get in on the action, as evidenced by the high cash bids. Ironically, many of the leases acquired in that dramatic lease sale turned out to be unproductive. The original leases acquired

by BP, Atlantic Richfield and Humble

Oil (now ExxonMobil) turned out to hold most of the oil and gas. The leases left over, and that those companies did not bid on in the early sales, were the ones auctioned by the State in 1969. The high bids from other companies wanting to get in on the action were on leases located off the main geologic structure, and they turned out to be mostly dry.

While the competitive bonus-bid system is used traditionally in State lease sales, there is one other form of granting a land right in return for exploration called an Exploration License. Similar to exploration concessions granted by some foreign nations to companies, the State Exploration involves granting exclusive exploration rights in a large land area in return for work commitments that are negotiated. There is no competitive cash bids. If a company explores and makes a discovery, the lands in and around the discovery can be converted to traditional State oil and gas leases that have the standard royalty and other lease requirements.

The idea is to encourage a search for petroleum in parts of the state, such as Interior Alaska, where there has been little

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exploration. Companies are given access to large areas with an agreement that their capital should be put into drilling and other exploration work rather than paid to the State treasury in a cash bid.

Since the Exploration License was put into State law a few years ago, several licenses have been issued by the State Division of Oil and Gas, with exploration drilling done on two, one in the Copper River area with a well near Glennallen, and a second in the Nenana Basin west of Fairbanks, with a well near the City of Nenana. Results of the well near Nenana are still confidential; the well near Glennallen found natural gas but technical problems presented a full test. Its status is uncertain.

Another important change made in the State’s leasing system involved the adoption of “area-wide” lease sales held at regular internals. The concept was borrowed from the federal government, which has used it successfully in Outer Continental Shelf leasing. As it is applied in Alaska, there are annual sales held at regular times for specific areas of the state: Cook Inlet, the North Slope onshore, North Slope offshore, the south foothills region of the Slope, and the Alaska Peninsula. All unleased State land in these areas is offered up on the given date and companies and individuals are invited to submit bids.

Most important is that all the prepatory work such as the required State Best Interest Findings for the sales are done in advance. This procedure replaced the previous system of the State offering sales at intermittent intervals and with Best Interest Findings done for individual sales. Done that way, the sales frequently bogged down with delays when lawsuits were filed by conservation groups. Best Interest Findings are now written for the entire area of unleased land and they are written to be valid for five years before being revised.

This reduces the chances that lawsuits can be brought against individual sales.

Area-wide sales have done wonders in reestablishing industry confidence in the State’s ability to offer up land for exploration. Because the sales are offered in the same areas at the same times every year, companies can plan and allocate investment capital knowing with a high degree of assurance that the sale will be held on schedule. q

www.akbizmag.com • Alaska Business Monthly • February 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.

Permanent Fund Performance

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any Alaskans are familiar with the Permanent Fund Dividend (PFD), which we each receive from a portion of the State’s investment earnings of the Permanent Fund’s approximately $37.6 billion in assets (as of Oct 2010). However, many of us have not considered how the Permanent Fund has performed relative to other possible investments or in relation to the overall financial markets. In this analysis, market indices, such as the S&P 500 and DJIA will be used as a proxy for the overall market.

What is the most appropriate way to look at the returns of the Permanent Fund in relation to these other investments?

When assessing the performance of any investment, two items must be considered: 1) the return generated from the initial investment net of fees, both in total and relative to a benchmark (often market indices) and 2) the risk assumed by the investor when investing in the particular investment vehicle.

All else being equal, the more risk an investor assumes the higher return the investor should expect to earn to compensate for this increased risk. Thus we can compare the returns and risk assumed within the Permanent Fund’s investments and several market proxies to determine how the Permanent Fund’s performance compares. One useful tool in making this comparison is the Sharpe Ratio, which is calculated as the average return during the comparison period, divided by the standard deviation of the fund’s returns during the same period. The higher the ratio, the higher the return provided by the investment per unit of risk.

The Sharpe ratio scores have no meaning independently; their only meaning is in their value relative to another Sharpe ratio. In this scenario, the Sharpe ratios over the period January 2006 through October 2010 were: PFD = .09, S&P 500 = .01, DJIA = .05. These scores indicate that the PFD provided a higher return per unit of risk than the overall financial markets during the evaluated period.

This quick calculation shows that during the studied period, the Permanent Fund seems to have been managed effectively as shown by its higher returns after factoring in the associated risk. q

Source: Yahoo Finance http://finance.yahoo.com/

Alaska Trends has been brought to you this month courtesy of American Marine/Penco

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

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Alaska Trends Indicator

Units

Period

Latest Report Period

Previous Report Period (revised)

Year Ago Period

GENERAL Personal Income – Alaska US $ 3rd Q10 31,373 31,264 30,284 Consumer Prices – Anchorage 1982-1984 = 100 1st H10 194.83 194.83 190.032 Consumer Prices – United States 1982-1984 = 100 1st H10 217.54 217.54 213.139 Bankruptcies Alaska Total Number Filed October 95 114 110 Anchorage Total Number Filed October 74 87 59 Fairbanks Total Number Filed October 11 17 19 EMPLOYMENT Alaska Thousands October 333.77 337.16 331.36 Anchorage & Mat-Su Thousands October 186.47 182.81 185.27 Fairbanks Thousands October 43.41 43.40 43.17 Southeast Thousands October 36.01 38.99 36.11 Gulf Coast Thousands October 34.72 37.36 34.02 Sectoral Distribution – Alaska Total Nonfarm Thousands October 319.0 333.1 320.0 Goods Producing

Thousands October 43.0 49.3 42.8 Services Providing Thousands October 276.0 283.8 277.2 Mining and Logging Thousands October 14.6 14.6 15.0 Mining

Thousands October 14.2 14.2 14.7 Oil & Gas Thousands October 11.8 11.6 12.5 Construction

Thousands October 16.7 18.4 17.4 Manufacturing

Thousands October 11.7 16.3 10.4 Seafood Processing Thousands October 7.4 11.8 6.4 Trade/Transportation/Utilities Thousands October 60.9 64.0 62.6 Wholesale Trade Thousands October 6.0 6.3 6.1 Retail Trade

Thousands October 34.8 35.6 35.7 Food & Beverage Stores Thousands October 6.0 6.1 6.3 General Merchandise Stores Thousands October 10.0 10.1 10.3 Trans/Warehouse/Utilities Thousands October 20.1 22.1 20.8 Air Transportation Thousands October 5.4 5.6 6.1 Truck Transportation Thousands October 2.9 3.1 3.2 Information

Thousands October 6.4 6.3 6.5 Telecommunications Thousands October 4.3 4.2 4.3 Financial Activities Thousands October 14.6 14.9 15.0 Professional & Business Svcs Thousands October 25.2 26.2 25.6 Educational & Health Services Thousands October 41.9 41.6 39.9 Health Care Thousands October 30.4 30.4 28.9 Leisure & Hospitality Thousands October 28.9 32.5 29.7 Accommodation

Thousands October 6.4 8.9 6.0 Food Svcs & Drinking Places Thousands October 18.7 19.0 17.9 Other Services

Thousands October 11.8 11.7 11.6 Government

Thousands October 86.3 86.6 86.3 Federal Government Thousands October 16.4 17.5 16.7 State Government Thousands October 26.4 26.6 26.3 State Education Thousands October 8.2 8.1 8.1 Local Government Thousands October 43.5 42.5 43.3 Local Education Thousands October 25.8 24.3 24.7 Tribal Government1 Thousands October 3.9 3.9 3.7 Labor Force Alaska Thousands October 361.04 363.64 360.17 Anchorage & Mat-Su Thousands October 200.20 196.44 199.78 Fairbanks Thousands October 46.49 46.35 46.49 Southeast Thousands October 38.88 41.58 39.18 Gulf Coast Thousands October 38.16 40.55 37.73

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

Year Over Year Change

3.60% 2.53% 2.06% -13.64% 25.42% -42.11%

0.73% 0.65% 0.56% -0.28% 2.04% -0.31% 0.47% -0.43% -2.67% -3.40% -5.60% -4.02% 12.50% 15.63% -2.72% -1.64% -2.52% -4.76% -2.91% -3.37% -11.48% -9.38% -1.54% 0.00% -2.67% -1.56% 5.01% 5.19% -2.69% 6.67% 4.47% 1.72% 0.00% -1.80% 0.38% 1.23% 0.46% 4.45% 5.41% 0.24% 0.21% 0.02% -0.76% 1.16%

Sponsored

Indicator

Units

by

American Marine/Penco

Period

Latest Report Period

Previous Report Period (revised)

Year Ago Period

Unemployment Rate Alaska Percent October 7.6 7.3 8.0 Anchorage & Mat-Su Percent October 6.9 6.9 7.3 Fairbanks Percent October 6.6 6.3 7.1 Southeast Percent October 7.4 6.2 7.8 Gulf Coast Percent October 9 7.9 9.8 United States Percent October 9 9.2 9.5

Year Over Year Change

-5.00% -5.48% -7.04% -5.13% -8.16% -5.26%

PETROLEUM/MINING Crude Oil Production – Alaska Millions of Barrels October 19.17 18.41 16.89 13.49% Natural Gas Field Production – Alaska Billions of Cubic Ft. October 11.02 9.78 11.25 -2.00% ANS West Cost Average Spot Price $ per Barrel October 82.41 75.27 74.28 10.95% Hughes Rig Count Alaska Active Rigs October 6 7 6 0.00% United States Active Rigs October 1668 1655 1044 59.77% Gold Prices $ Per Troy Oz. October 1,342.61 1,271.22 1,043.34 28.68% Silver Prices $ Per Troy Oz. October 2339.33 2054.98 1723.61 35.72% Zinc Prices Per Pound October 1.19 1.08 1.04 14.01% REAL ESTATE Anchorage Building Permit Valuations Total Millions of $ October 92.21 25.53 21.14 336.10% Residential Millions of $ October 5.95 16.37 8.86 -32.90% Commercial Millions of $ October 86.26 9.16 12.28 602.41% Deeds of Trust Recorded Anchorage – Recording District Total Deeds October 1166 1023 866 34.64% Fairbanks – Recording District Total Deeds October NO DATA 374 343 NO DATA VISITOR INDUSTRY Total Air Passenger Traffic – Anchorage Thousands October 421.23 368.69 346.90 6.28% Total Air Passenger Traffic – Fairbanks Thousands October 75.11 87.44 87.51 -14.17% ALASKA PERMANENT FUND Equity Millions of $ October 37,287.90 36,340.60 33,054.80 12.81% Assets Millions of $ October 37,740.50 36,700.40 33,246.20 13.52% Net Income Millions of $ October 174.8 255.5 97.4 79.47% Net Income – Year to Date Millions of $ October $892.0 $1,852.7 ($316.4) 381.92% Marketable Debt Securities Millions of $ October 44.7 60.2 53.7 -16.76% Real Estate Investments Millions of $ October 43.7 16.6 (96.2) 145.43% Preferred and Common Stock Millions of $ October 651.2 1,629.4 (374.2) 274.02% BANKING (excludes interstate branches) Total Bank Assets – Alaska Millions of $ 3rd Q10 2,068.99 1,997.42 1,924.56 7.50% Cash & Balances Due Millions of $ 3rd Q10 37.35 38.04 42.13 -11.34% Securities Millions of $ 3rd Q10 131.40 136.91 93.50 40.52% Net Loans and Leases Millions of $ 3rd Q10 1,110.96 1,115.36 1,183.18 -6.10% Other Real Estate Owned Millions of $ 3rd Q10 15.76 17.78 13.28 18.65% Total Liabilities Millions of $ 3rd Q10 1,823.80 1,757.70 1,687.97 8.05% Total Bank Deposits – Alaska Millions of $ 3rd Q10 1,785.53 1,720.30 1,658.77 7.64% Noninterest-bearing deposits Millions of $ 3rd Q10 479.89 453.48 429.20 11.81% Interest- bearing deposits Millions of $ 3rd Q10 1,305.64 1,266.82 1,229.57 6.19% FOREIGN TRADE Value of the Dollar In Japanese Yen Yen October 81.86 84.48 90.36 -9.41% In Canadian Dollars Canadian $ October 1.02 1.03 1.05 -3.42% In British Pounds Pounds October 0.63 0.64 0.62 1.88% In European Monetary Unit Euro October 0.72 0.77 0.68 6.57% In Chinese Yuan Yuan October 6.67 6.75 6.83 -2.32% Data compiled by University of Alaska Center for Economic Development.

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

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Advertisers Index Alaska Communications . . . . . . . . . . . . . . . . . . . 30, 31

Construction Machinery Industrial LLC . . . . . . . . . . 115

North Star Behavioral Health . . . . . . . . . . . . . . . . . . . 97

AES Employment Services . . . . . . . . . . . . . . . . . . . . 70

Crowley . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

Northern Air Cargo . . . . . . . . . . . . . . . . . . . . . . . 58, 59

Alaska Aerospace Corp . . . . . . . . . . . . . . . . . . . . . . . 45

Cruz Construction Inc . . . . . . . . . . . . . . . . . . . . . . . . 43

Northrim Bank . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94

Alaska Air Cargo . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57

CRW Engineering Group LLC . . . . . . . . . . . . . . . . . . 71

Northwest Ironworkers Employers Association. . . . . 41

Alaska Bone & Joint Institute . . . . . . . . . . . . . . . . . . . 98

Design Alaska . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83

Pacific Alaska Freightways . . . . . . . . . . . . . . . . . . . . 47

Alaska Public Telecommunications . . . . . . . . . . . . . . 37

Dowland-Bach Corp. . . . . . . . . . . . . . . . . . . . . . . . . . 75

Pacific Pile & Marine . . . . . . . . . . . . . . . . . . . . . 8, 9, 10

Alaska Regional Hospital . . . . . . . . . . . . . . . . . 96, 101

EDC Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84

Paris Bakery & Cafe . . . . . . . . . . . . . . . . . . . . . . . . . . 17

Alaska Rubber & Supply Inc . . . . . . . . . . . . . . . . . . . 42

Eklutna Native Corp. . . . . . . . . . . . . . . . . . . . . . . . . . 87

Parker, Smith & Feek . . . . . . . . . . . . . . . . . . . . . . . . . . 3

Alaska Traffic Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44

Engineered Fire & Safety . . . . . . . . . . . . . . . . . . . . . . 62

PDC Engineers Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . 69

Alaska USA Federal Credit Union . . . . . . . . . . . . . . . 55

Fairweather . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105

Peak Oilfield Services . . . . . . . . . . . . . . . . . . . . . . . 110

Alutiiq Oilfield Solutions LLC . . . . . . . . . . . . . . . 53, 107

F. Robert Bell & Associates . . . . . . . . . . . . . . . . . . . . 79

Pen Air . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64

Ameresco . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109

First National Bank Alaska . . . . . . . . . . . . . . . . . . . . . . 5

PND . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82

American Fast Freight . . . . . . . . . . . . . . . . . . . . . . . . 49

Golden Valley Electric Association . . . . . . . . . . . . . . . 49

R&M Consultants . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66

American Marine/PENCO . . . . . . . . . . . . . . . . . . . . 111

Golder & Associates Inc. . . . . . . . . . . . . . . . . . . . . . . 75

Rosie’s Delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

Anchorage Convention & Visitors Bureau . . . . . . . . . 27

Granite Construction . . . . . . . . . . . . . . . . . . . . . . . . . 38

RSA Engineering Inc. . . . . . . . . . . . . . . . . . . . . . . . . . 75

Anchorage Opera . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

Great Originals Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . 84

Seekins Ford Lincoln Mercury Fleet . . . . . . . . . . . . 110

Arctic Fox Steel Buildings . . . . . . . . . . . . . . . . . . . . . 62

Haight & Associates Inc. . . . . . . . . . . . . . . . . . . . . . . 78

SENCO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50

Arctic Office Products . . . . . . . . . . . . . . . . . . . . . . . 104

Hawk Consultants LLC . . . . . . . . . . . . . . . . . . . . . . 104

SGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89

ASRC Energy Services . . . . . . . . . . . . . . . . . . . . . . . 83

Hydraulic Repair and Design . . . . . . . . . . . . . . . . . . . 63

Stellar Designs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

ASTAC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26

Judy Patrick Photography . . . . . . . . . . . . . . . . . . . . 108

STG Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41

Azimuth Adventure Photography . . . . . . . . . . . . . . . . 51

Juneau Convention & Visitors Bureau . . . . . . . . . . . . 13

Superstar Pastry Design . . . . . . . . . . . . . . . . . . . . . . 19

B2 Networks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

Ketchikan Visitors Bureau . . . . . . . . . . . . . . . . . . . . . 14

The Growth Company . . . . . . . . . . . . . . . . . . . . . . . . 15

Bartlett Regional Hospital . . . . . . . . . . . . . . . . . . . . . 13

Lounsbury and Associates . . . . . . . . . . . . . . . . . . . . . 82

TRIODETIC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54

Beacon Publishing & Design . . . . . . . . . . . . . . . . . . 19

Lynden Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

TTT Environmental . . . . . . . . . . . . . . . . . . . . . . . . . . 78

Business Insurance Associates Inc. . . . . . . . . . . . . . 53

Material Flow . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63

Umiaq LLC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91

CareNet Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100

MTA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

University of Alaska Anchorage/Engineering . . . . . . . 65

Carlile Transportation Systems . . . . . . . . . . . . . . . . . 39

MT Housing Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61

Usibelli Coal Mine Inc. . . . . . . . . . . . . . . . . . . . . . . . . 64

Chris Arend Photography . . . . . . . . . . . . . . . . . . . . 114

NALCO Energy Services Inc. . . . . . . . . . . . . . . . . . . 62

Washington Crane and Hoist . . . . . . . . . . . . . . . . . . . 15

Cloud49. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26

Nenana Heating Services Inc. . . . . . . . . . . . . . . . . . 107

Wells Fargo Bank NA . . . . . . . . . . . . . . . . . . . . . . . . 116

114

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

Momma is a miner.

EX1900-6 Excavator and EH1700 Truck at Alaska Gold Company.

EX5500 as purchased by Fairbanks Gold Mine.

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IN YOUR CORNER The Winning Team.

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