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Dear Neighbors & Friends, I hope this holiday season is bringing joy to your home and family! I’m grateful for our beautiful mountains and am hoping to use my down time for more time outside. Here’s to hoping for more snow! Joint Resources Meeting on BP to Hilcorp Sale
This deal is a big for our state, some even characterizing the sale as the biggest business deal in a generation. The value of the sale is $5.6 billion, which sounds like a lot, but in the context of the AKLNG Project, projected to cost up to $45 billion, it doesn’t seem as substantial. There is one major concern all Alaskans should want addressed with certainty; an issue called DR & R. This stands for dismantle, remove, and restore. This is what happens when the oil development ends. Who knows exactly when that will be? That’s one reason this is an issue. Regulators will require financial assures that the cost can be covered, but of course these are just estimates and costs could increase substantially when the work actually happens. That is a major concern – will the funds actually be there and if not, would the state get stuck with the bill? In addition, the way this has been addressed over the last forty years is that the operator-owners of TAPS, Exxon-Mobil, BP, and Conoco Philips, are allowed to include a per barrel surcharge to cover this costs. While it’s estimated that the cost is around $2.6 billion, the operator-owners have collected over $5 billion to cover the costs. That’s seems like a good because if it costs more it means they have the funds to cover it, right? Wrong. Or potentially wrong. The strange thing about this is that even though the funds have been collected the companies were not required to put the money aside in an account; instead it’s set up more like even though they have the money they will only ever pay when the bill comes. That in itself might be so bad, but in this sale of BP to Hicorp, BP is saying they will retain the responsibility for the DR & R. BP will be long gone from Alaska, but will still have the responsibility. Hmm. This gives me pause. This is not the level of certainty I want. We are exploring options for addressing this issue. If you have some time over the holiday, I’d recommend watching the hearing, found here: http://www.akleg.gov/basis/Meeting/Detail?Meeting=HRES%202019-12-16%2014:00:00 The Budget! A lot to not like…. The new budget is out. There are things not to like, but it’s no where near last year’s budget with the draconian cuts Governor Dunleavy proposed. That’s the good news. I wish it was all good news. Unfortunately, the bad news about this budget is he proposes a messy way to fund it that would leave us very vulnerable. The proposal doesn’t push us off the edge, but gets damn close. Specifically, he proposes spending down almost every last penny of savings, something that could mean we can’t pay our bills at some point. Here’s how it works – we have the Constitutional Budget Reserve, that we use for cash flow, to pay bills as we wait for payments from the federal government, etc. We are supposed to keep the CBR at $2 billion. It’s there now and the Governor proposes to use most of what’s left. Other questionable cuts include again recommending cutting the dairy program. The “Open for Business” Governor is proposing to eliminate the dairy industry in Alaska for a mere savings of some thousands of dollars. This is totally unacceptable. Farmers have no choice as the federal government requires that there be a government run inspection program for consumer safety. This makes no sense. The budget appears to be status quo, but I suspect that is because the Governor realizes he can’t successfully cut the budget through the legislative process, but instead through the veto process. This means more uncertainty for our economy. I’ll be working hard to push back against these short sighted proposals that harm our economy. And because it’s only a one year solution it means we will have this conversation the next year too. We must do better! Here’s more: https://www.adn.com/…/dunleavy-tries-new-tack-on-2021-budg…/ A Very Busy Fall – Part 3 of 3 – My Fairbanks Fall For some reason, every organization had their annual meeting in Fairbanks, so I found myself going to Fairbanks five different times this fall, for the Alaska Defense Forum, Alaska Federation of Natives, Alaska Invasive Species Partnership, Alaska Association of Soil and Water Conservation Districts, and the Alaska Farm Bureau. I want to share with you why I’m working with these organizations and why these meetings were important for my work. Legislator of the Year: Let’s start with something fun! Pictured with me – Chris Rainwater, AACD President, Chris Flickinger, Kodiak Soil and Water Conservation District, and Nicole Arevalo, with AACD & Homer Soil and Water Conservation District. Beyond work on agriculture, the Soil and Water Conservation Districts across the state are doing really important work on reclamation after development, invasive species issues, and food security. Check out their website to learn more. While in Fairbanks we also visited Globe Creek Mining, a limestone mining operation, and Arctic Harvest, a distillery produce distilled spirits with Alaska Grown grains. Check out the Facebook album for more pictures from our visits! If you’re looking for an organization to work with on issues that matter, check them out. They can always use more volunteers! Now, just going back in order of the trips, they were as follows. Alaska Defense Forum: This year I am serving as the Co-Chair of the Joint Armed Services, a committee formed to be a state link to our Congressional delegation on issues of national security and military needs in Alaska. In this role, I was honored to represent the legislature at the first ever in Alaska, Alaska Defense Forum. The three day forum brought together state and national military leaders with community leaders to deepen our understanding of current defense issues and threats and how the state can better support our military. The take away message for me was that in order for us to support our military members we must support their whole family. We heard about concerns with cuts to education funding as parents being transferred to Alaska want good schools for their kids and the challenge of finding work because of restrictions on things like professional licenses that don’t always easily transfer from state to state. We also hosted a breakfast with leaders that was powerful as we spent significant time discussing the issue of suicide among soldiers and Veterans. The rates are totally unacceptable and this year Alaska has been hit hard. This fall there was coverage and a call for action. I stand ready to do more. I definitely question decisions about our military presence and engagement in different conflicts, but I will always support the soldiers that have signed up to serve. I left feeling inspired to do more to welcome new military members into our communities. It was shared that soldiers often can’t afford to go home at the holidays and can feel quite lonely so the Alaska Coalition for Veterans and Military Families works to find families to sponsor a soldier. If you’re interested, here is the website. https://akcvmf.org/ Below: This impressive group includes General Saxe, Alaska’s Alaska Adjutant General and Commissioner of the Department of Military and Veterans Affairs, Major General Peter B. Andrysiak, command of United States Army Alaska, Rep. Laddie Shaw, Veteran who served as a Navy Seal, Senator Revak, recipient of a Purple Heart, as well as the public members of the JASC Committee, all Veterans. In total there is probably over 200 years of combined military service in this photo.
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