Elizabeth Earl

Cook Inlet fishermen celebrate ‘Return of the Reds’ with hope for 2019

Cook Inlet fishermen are looking forward to their salmon season with high hopes that the sockeye will arrive in better numbers than last year. On June 11, fishermen and processors grilled up some of the first Cook Inlet salmon of the year at the Pacific Star processing plant in Kenai, gathering to build excitement for the coming season. The plant is now receiving salmon from the west side of Cook Inlet, while the fishermen in the drift gillnet and east side set gillnet fleets gear up for their first expected openings in the coming weeks. The event, dubbed the Return of the Reds, was reminiscent of the recent gatherings in Anchorage and Seattle to receive the first Copper River salmon of the year, a heralded fish in the culinary and fisheries world. The Kenai version is the first in what the Alaska Salmon Alliance hopes will be a new annual tradition for the area, said ASA President Nate Berga. Retailers, fishermen and local government officials gathered at Pacific Star and donated proceeds from sale of grilled fish to the Kenai Peninsula Food Bank. The event was less about promoting the processor or the industry than connecting Alaskans with their locally available fish as well as building excitement for the season, he said. “The biggest thing that we wanted to focus on is getting fresh Alaska salmon onto Alaskans’ plates,” he said. Alaska salmon is an internationally valuable commodity, with a huge percentage being shipped overseas to Asia and some being consumed in the Lower 48. Many Alaskans fill their freezers with salmon they harvest themselves at personal-use dipnet fisheries or in sport fisheries, but others may not have the chance — and the ASA wants to see Alaskans more connected with their commercial fisheries, Berga said. Commercial fisheries are also one of the largest private industry employers in Alaska, and most of the Cook Inlet fishermen live in the state according to permit data. “This is a time when our state is struggling,” he said. “This money is staying here.” Upper Cook Inlet faced a terrible sockeye harvest in 2018 — about two-thirds below the recent 20-year average — with the total estimated run coming in at 1.7 million sockeye to the Kenai River and 697,000 to the Kasilof River. Fishermen sat on the docks for much of the season, and the Alaska Department of Fish and Game closed the Kenai River dipnet fishery a day early with an eye toward making escapement goals. The sonar has yet to click on for the Kenai River, the major driver in the region, this year, but early reports from sport fishermen on the river indicate good abundance. The Russian River sport fishery opened June 11 at midnight, with more than 8,400 sockeye past the weir on Lower Russian Lake as of June 10, though it takes about a week for sockeye to typically make it to the Russian River from the lower Kenai, according to ADFG. The large early numbers and fish holding in the Kenai River prompted ADFG to open the area known as the Russian River Sanctuary — a section of the Kenai River close to the confluence of the two rivers — earlier than usual, according to a news release. “Looks like the Russian River is off to a strong start. We haven’t seen numbers like this for several years,” stated Area Management Biologist Colton Lipka. “Sport fishing for sockeye salmon in the Russian River area will likely be good to excellent.” If ADFG’s forecast proves out, about 6 million sockeye will return to the stream systems throughout Upper Cook Inlet this year, about 200,000 more than the 20-year average. That increase is mostly in the Kenai River, where the forecast estimates about 3.8 million salmon to return this year. The Kasilof, which is the second-largest sockeye system in the region, is forecasted at 873,000 sockeye, which is about 94,000 fish less than its 20-year average. Sockeye are the primary driver in Cook Inlet, but fishermen are also out for chum, silver and pink salmon as well. In Lower Cook Inlet, fishermen are oriented toward pink salmon harvests, both wild and hatchery, and some smaller sockeye runs than further north. ADFG’s preseason forecast about 2.4 million in commercial common property harvest for the area. That’s only the commercial common property harvest, as researchers have recently found a high percentage of hatchery-marked fish in Lower Cook Inlet streams, possibly confusing the traditional spawner-recruit forecasts the department has done in the past, according to the forecast. Other species were also produced as commercial common property harvest forecasts, including 125,000 sockeye, 84,800 chum, 13,700 silvers and 452 kings, according to the forecast. The first Cook Inlet drift gillnet period is expected after June 19 this year, which would fall on June 20, while the East Side setnet fisheries won’t open until the first regular period on or after June 25 in the Kasilof section and July 8 in the Kenai and East Forelands sections. Elizabeth Earl can be reached at [email protected]

Rural telecoms, including Alaska, worry over Huawei order

A new rule about how telecommunications companies can use some of their funding from the federal government may poke a hole in their wallets, especially as they are looking to migrate their networks to 5G. From selling its cell phones and laptops to providing high-level networking equipment, the U.S. government has effectively banned the Chinese telecom company Huawei from doing business in the United States. President Donald Trump cited national security concerns in his May 15 executive order in response to worries from Congress and the Central Intelligence Agency regarding Huawei’s close relationship with the Chinese government and the potential for security breaches in network buildouts using Huawei equipment. The Federal Communications Commission had its own rulemaking process already going on a similar topic, beginning almost a year earlier in March 2018, which would ban the use of Universal Service Fund monies in buying equipment from Huawei or a number of other Chinese telecommunications companies. The commission is citing national security threats to the communications supply chain in the proposed rule. Huawei, the No. 2 smartphone maker in the world, is one of the largest telecom equipment providers in the world, and its equipment already helps deliver service to many areas of the United States. Because its equipment tends to be less expensive than its competitors, many smaller and rural telecom providers have bought the company’s equipment, and the rule means a huge economic cost to them. Companies probably aren’t going to be able to cobble together networks with some Huawei equipment, though. According to a number of filings with the FCC about its proposed rule, companies are concerned about interoperability between Huawei equipment and other equipment they have to purchase in the future. But they’re also concerned about the increased expense — according to an FCC filing in November 2018 from the Rural Broadband Association, some companies have been quoted two to four times as much for the same equipment from Lucent or Ericcson, two other primary suppliers. Alaska’s rural geography presents a challenge for telecom providers. Much of rural Alaska is served by GCI along with a number of smaller local companies that also provide services in rural areas. AT&T is the largest provider of mobile phone service in the state. Larger companies can spread their costs across multiple geographies and many customers; small rural companies don’t have that option, and swallowing millions in expenses to rip out and replace equipment that the U.S. government has now banned is a fairly large expense. Sen. Dan Sullivan, R-Alaska, is co-sponsoring a bill to help address some of that cost. The United States 5G Leadership Act would set aside $700 million for U.S. telecom providers to replace Huawei equipment in their current infrastructure. The bill is dependent on the FCC finalizing its proposed rule banning companies from using Universal Service Fund monies to buy Huawei equipment. Sullivan has heard directly from Alaska telecoms that are currently using Huawei and ZTE equipment, said Mike Anderson, communications director for Sullivan’s office. ZTE is the No. 2 Chinese telecom company behind Huawei. “Senator Sullivan will very much be monitoring how any prospective legislation such as this bill or regulation will impact our carriers, and engaging policymakers like the FCC accordingly,” Anderson wrote in an email. “Part of why he was pleased to partner with (Mississippi Sen.) Chairman (Roger) Wicker on this bill is because unlike any other proposed solution, it included a funding mechanism for ripping and replacement.” The $700 million figure isn’t set in stone, as the bill sponsors don’t have a precise inventory of equipment that needs to be replaced, in part because wireless equipment is more difficult to inventory, Anderson said. There is language in the bill allowing for additional funding if the original amount is not enough. “We estimated that we needed $800 million to $1 billion for our carriers, but that only covers about a dozen companies,” Carrie Bennet, general counsel for the Rural Wireless Association, told NBC News in a May 27 story. “I don’t want to insult the bill they’ve introduced. It’s great that someone has focused on what this is going to cost, but this is not enough money.” Alaska was significantly behind in implementing 4G infrastructure, particularly outside the urban areas of Anchorage, Juneau and Fairbanks. Network connection is expensive and the geography and distance makes it logistically difficult. However, companies are now catching up with faster speeds, particularly in urban areas, and newly installed cell towers in western Alaska as part of GCI’s infrastructure investment there. But as they do, the country is looking toward 5G, the next generation of wireless communication standards with higher speeds and lower latency times. AT&T included Anchorage in a 2018 announcement of its initial 5G network rollout, initially announced to be deployed in 2019 and 2020. A May 31 press release from the company stated it has spent $250 million in Alaska from 2016-18 to improve its network. So far, the company has updated its network to 5G Evolution in Anchorage, Bethel and Kusilvak, which enables customers in those areas with 5G-enabled devices to access faster speeds, wrote AT&T spokesman Brent Camara in an email. “While we have not yet announced specific plans for 5G cities in Alaska, we continue investing in building the network our customers need today and preparing for the future,” he said. Like in the past, rural residents may not see the service their urban neighbors do from major carriers for a long time, even as speeds increase significantly in urban areas. That’s one of the reasons organizations like the Rural Wireless Association advocate for policies that support rural providers — because the small companies based in rural areas will build out those areas rather than focusing on the bigger, more valuable markets. Daryl Zakov, senior counsel for the Rural Wireless Association, said the organization has a number of issues it advocates for to support rural networks as the world moves to 5G, including advocating for the FCC to auction off smaller license service areas so rural companies can more effectively bid on them and implement new rules on roaming service partnerships. The telecom market has consolidated in the past decade, with regional companies going under or merging; four companies dominate the U.S. market while smaller rural companies serve more constricted areas, with two currently trying to merge. The four big companies — Verizon, AT&T, Sprint and T-Mobile — will likely be focusing their initial buildouts in urban areas rather than expanding coverage to rural areas, if they get there at all. Smaller rural companies, on the other hand, don’t have to choose between urban or rural settings for their infrastructure focuses, Zakov said. “(Urban areas are) where (the big companies) are going to start their coverage,” he said. “When rural carriers start building out, that’s going to be in the rural areas. In every generation, urban areas have been built out before rural areas.” Sprint and T-Mobile told the FCC in filings they will build out rural 5G coverage if their merger is approved. Elizabeth Earl can be reached at [email protected]

Copper River sockeye show up early, give optimism for fleet

Copper River fishermen are getting a nice change of pace from the last two years this season as the sockeye run is shaping up better than expected so far. As of June 2, approximately 240,234 sockeye salmon had passed the sonar at Miles Lake on the Copper River, according to the Alaska Department of Fish and Game. That’s about 65,000 more fish than the cumulative management objective so far on the river, which is based on average past escapements. It’s definitely better than in 2017 and 2018, when slow and weak sockeye runs kept commercial fishermen at the docks as managers struggled to make escapements. On the same date in 2018, only 55,840 sockeye had passed the sonar. There’s a significant lag between fish entering the mouth of the Copper and Miles Lake, which is far upstream — about 33 miles — and the passage time can depend on the water levels, according to ADFG. There’s also a lag between the passage at the sonar site and the popular Chitina personal use dipnet fishery area, which is about 70 miles upstream from the sonar. So far, commercial catches have been good, too; 326,257 sockeye have been landed in 2,801 deliveries. More than half of that total was landed in the periods on May 27 and May 30, with about 189,000 sockeye harvested between the two days. It’s not a banner year, but it’s also not too shabby in the context of the last two years, said Jeremy Botz, the commercial gillnet area management biologist for Prince William Sound. The run in-river is a little ahead of schedule, but so far, the run may shake out close to the forecast estimate. “This’d be pretty typical for timing for a peak in the fishery,” he said. “The run has been ahead of the curve, especially in-river. (It’s) right about anticipated in the commercial fishery, throughout the first two periods. We’re far enough into it now to have what appears to be a pretty reasonable fishing schedule.” The Copper River fishing season kicks off with kings. In 2017, concern for enough king salmon escapement in the river prompted commercial fishing restrictions on the fleet that curtailed early sockeye harvest; in 2018, the run lagged through May into June, leaving fishermen in the typically first-on-the-market Copper River mostly emptyhanded. The overall run shaped up into a decent season, but only toward the latter half. The forecast for this year in the Copper is somewhat lackluster — between hatchery and wild production, ADFG projected about 1.5 million sockeye, with wild production at just more than 1.4 million fish and Gulkana hatchery production at about 98,000 fish. If it proves true, the wild run would be about 31 percent less than the recent 10-year average and the hatchery run would be about 69 percent below the average, according to the forecast. In the forecast, managers warned caution. While the Copper River’s sockeye salmon forecast is widely regarded as the most reliable in Prince William Sound, managers have been unpleasantly surprised in the last two years as sockeye failed to materialize in the numbers or schedule they predicted. Managers have indicated that warm water conditions in the Gulf of Alaska may have contributed to poor survival for salmon. The Copper River has separate goals: one for the upper drainage and the other for the lower drainage, Botz said. The fish in the earlier part of the run tend to be headed farther upstream, while those in the latter part of the season tend to be more delta-bound fish. “Last year (the run) kind of came online in the second half of the season,” he said. “That’s still a big question mark.” It’s good news for Cordova, where a large number of the residents depend on the commercial fishing industry for their income. In general, the fleet is optimistic about the run, said Chelsea Haisman, the executive director of the Copper District Fishermen United trade group. “Our whole community — the schools, the restaurants, the small businesses — not just the commercial fishermen, depends on healthy salmon runs, so it is a breath of fresh air for everyone here,” she wrote in an email. “The weather has been tough in the early season, but as we move into June, we’re definitely ready for some calmer days and a little more sun.” The Copper River’s salmon run is typically the first Alaska wild salmon to hit the market and thus commands a high price. Chefs on the West Coast were reportedly asking $55 for a Copper River sockeye dish upon first delivery this May, and fishermen reportedly getting $9 to $10 per pound at the dock for sockeye and $14 for kings. Typically, supply goes up at the season goes on and the price drops, with fishermen in other areas seeing much lower prices for their salmon by the time they come online in June. Bristol Bay typically floods the market with sockeye in June and July, pushing the prices significantly down. It’s also a canary in the coal mine for other salmon runs across the Gulf of Alaska, including Cook Inlet and Kodiak. Last year, all three tracked together with disappointing sockeye salmon runs and widespread closures. Cook Inlet’s commercial fishermen are due to hit the water in mid-June, though some fisheries in Lower Cook Inlet open at the beginning of June. In the Kodiak Management Area, managers may announce sockeye salmon openers after June 1. Elizabeth Earl can be reached at [email protected]

Solar energy lighting up more of land of Midnight Sun

A new industry is lighting up Alaska. Anchorage residents in particular have seen solar panels going up on buildings in their communities in the past five years. But across the state, more Alaskans are turning to the sun to power their homes and businesses. Over the last four years, Arctic Solar Ventures in Anchorage has seen 200 percent year-over-year growth, according to owner Stephen Trimble. This year, the business will mark its first megawatt, or 1,000 kilowatts, of installed solar power. “That’s a big achievement,” he said. “We have systems operating from Homer to Talkeetna.” Despite common conceptions about Alaska being too dark and snowy to be practical for solar, the technology has a long history in the state, particularly in rural Alaska. The first Solar Design Manual for Alaska was published in 1981, with a revised fifth edition published in May 2018 by the Alaska Center for Energy and Power and the Cooperative Extension Service. Off-grid cabins, fish camps and rural communities have long looked to alternative sources of energy as the cost of power in Alaska remains high. However, even Railbelt homeowners and businesses have been moving toward solar power. There are a number of motivations for that, but a major one is likely the plummeting cost of solar installations. Between 1980 and 2012, module costs fell about 97 percent, according to a November 2018 study published in the journal Energy Policy. “I would say in rural Alaska it’s become quite popular because it’s quite cheap,” said Erin Whitney, the manager for the solar technology program at the Alaska Center for Energy and Power, or ACEP. “It’s easy to install. Kits are pretty much turnkey. A wind turbine requires a massive foundation, which requires heavy equipment. If you’re in a rural village, it’s expensive, whereas a solar panel setup — that can be installed in a day.” Trimble said installers in Alaska have become somewhat innovative with methods to maximize the solar energy available, even during the winter. For instance, some buildings have solar panels installed vertically on their walls to prevent snow buildup, even though Anchorage gets far less snow than it used to as the climate warms, he said. “Between March and October, you actually have more than 12 hours of daylight per day, even down in Anchorage,” he said. “We’ve done probably 20 or more homes that are 100 percent net solar for the year. At the end of the year, they net out having received 100 percent of their power from solar. For a lot of folks, that’s really surprising; it’s that peak season of March to October that we have so much that it makes up for the dark months of winter.” The primary increase in solar power installations in the past decade or so has been on the Railbelt, Whitney said. The Anchorage metropolitan area, with approximately half the state’s residents, is pivoting toward solar in a number of areas. The Solarize Anchorage campaign is blazing forward this summer in the Turnagain, South Addition, Spenard and Rogers Park neighborhoods, helping residents band together to hire a solar energy contractor for their homes. ACEP and the Alaska Center have helped the residents with the logistics of the campaign, Whitney said. The installations aren’t cheap — a ballpark figure comes out to about $5,000 to $10,000 for a single homeowner, with larger installations costing more — but the discount comes from bulk purchasing and installations. “Solarize is a concept that’s been done all over the Lower 48,” she said. Multiple utility companies in the state have either installed solar or are seriously considering it. Golden Valley Electric Association installed a 563-kilowatt solar farm last year for about $850,000 after a $225,000 U.S. Department of Agriculture’s grant program incentivizing rural energy development. Chugach Electric Association is currently planning to install an approximately 500-kilowatt solar farm in Anchorage for an estimated $2 million, while Homer Electric Association’s board of directors proposed a community solar project to its members but didn’t get sufficient commitment to move forward with one, according to HEA’s 2018 annual report. There’s appetite for solar outside the Anchorage area. In Soldotna, local business River City Books is moving to a new building with a system of approximately 15 kilowatts on its roof installed by Anchorage Solar. Part of the project takes advantage of federal programs — one being the USDA rural energy development program and the other through federal tax credits for qualifying solar energy programs. Five projects through the USDA were authorized for funds on the Railbelt outside of Anchorage and Fairbanks in 2018 alone, according to the USDA’s Energy Investment Map. A number of Arctic Solar Venture’s systems have gone into communities along the Railbelt outside Anchorage. This year is the last year for programs to qualify for the full 30 percent tax credit, Trimble said. Next year, the credit will begin decreasing and will ultimately fall to a 10 percent tax credit for installed solar systems. “Whether you’re politically conservative or politically liberal, it doesn’t matter, because if you’re assessing solar as a potential customer, there’s the environmental benefits, there’s the immediate electric bill savings on a daily, weekly, monthly basis that are very substantial,” he said. “Most of our solar installations produce power at about a third of the cost of what they pay.” In addition to the decreasing cost of installation, utilities began allowing net metering in Alaska in 2010. Through net metering, homeowners or business owners can produce power from small energy systems and offset their energy bill through a utility company. Net metering in Alaska is currently capped at 1.5 percent of total retail demand. Beyond that, it’s up to the individual utility to decide whether to allow more, Whitney said. The future growth of individual solar installations could be inhibited there. “There’s certainly some discussions being had right now on whether it makes sense to change that limit,” she said. “Once you’re above that limit, it’s up to the goodwill of the utilities to continue allowing it.” Raising that limit would reduce uncertainty for residents and certainly for installers. Trimble and a number of other solar installers recently banded together and formed their own trade association: the Alaska Solar Energy Industry Association, or AKSEIA. The continuation of the net metering program is on the group’s list of issue interests, as well as regulatory certainty from the state, he said. But the members are also able to share information and communicate about projects, as well as keep to an ethical code that will protect consumers from bad actors as the solar industry grows, he said. “As any new industry tries to take shape, there can be people who come along when they see economic opportunity … and you get unqualified people doing work that can cause damage to homes, potentially produce injuries; at minimum, giving solar a bad name,” he said. “So we came up with this industry code of ethics to start introducing consumer protections from our side. We very much want to self-police and self-govern the industry, and everyone’s been very receptive.” Elizabeth Earl can be reached at [email protected]

Fishery observer survey seeks answers for high turnover

Many of Alaska’s commercial fisheries depend on observers having a place on board, but fewer than a fifth of them feel appreciated by the industry, according to a new survey. Fishery observers sail on vessels with fishermen in federal waters and keep track of catch and bycatch and take biological samples throughout trips. Managers use this information to evaluate stocks and manage fisheries. The job can be tough, requiring up to a month at a time on the water in rough conditions, and turnover can be high. The survey, conducted by the National Marine Fishery Service in 2016, asked 553 observers why they did the job and what their experiences have been like. Although three-quarters of them thought the job helped them in their careers and about 69 percent said the days at sea matched their expectations, nearly half them reported being harassed. Only 20 percent said they felt valued by the fishing community, and many said they were disappointed by a lack of opportunity to learn more about science and management, according to the survey findings, published in May. The original intent of the survey was to help improve retention. Most observers quit after a few years — the West Coast, with about 5½ years, has the longest average tenure. Alaska’s average tenure is about 4.8 years, according to the survey data. Although observers have to have some training or education before taking the job, there’s a lot they learn through experience. “Because the technical skills observers possess take time to hone and are essential to good data collection, retaining knowledgeable and hardworking observers is important to NOAA Fisheries,” the report states. “It is widely recognized that an observer’s job requires field skills and scientific knowledge that may require many deployments before gaining proficiency.” Many of the observers start their careers young, between the ages of 20 to 29, and leave the job as they get older. Most cite a chance for fieldwork as a major motivation for taking the job, but relatively low pay, lack of a predictable schedule and distance from home leads them to leave later. About 46 percent reported being harassed on the job, though, with only about a third reporting it every time. About 40 percent reported it some of the time and 27 percent never reported, according to the survey. “This survey also did not specify what type of harassment observers may have experienced or reported during their careers,” the survey states. “Incidents reported in this survey could include anything from a glare, to interfering with a workstation, to physical or sexual assault.” Observers cited different reasons for not reporting: disappointment with how the report was handled, a chance to resolve the issue at sea, worry about work reputation or choosing to let the issue go. Connected to the reports of harassment, the NOAA Office of Law Enforcement is conducting a followup anonymous survey specific to the North Pacific region. Preliminary data was presented to the North Pacific Fishery Management Council in 2018, with final data included in a report to the council in December 2018. Only 25 percent of observers responded, according to the Office of Law Enforcement report. Responses indicated that incidents of harassment fell between 2016 and 2017, though 45 percent of female observers still said they experienced verbal sexual harassment in 2017 though few reported it. The national observing program is massive. Alaska alone had about 413 observers, and about 4,423 trips were either observed by a person or an electronic system in 2018, according to the 2018 annual report on the observer program in the North Pacific from NMFS. Some of Alaska’s vessels require full coverage, such as catcher-processors, meaning all of the catch is recorded on every trip, while others only require partial observation, such as catcher vessels fishing for halibut or sablefish, meaning only some of the fishing trips are observed. About 53 percent of the respondents worked in Alaska, with the majority in halibut or groundfish fisheries. One of the common problems is a shortage of certified observers for fisheries in the region; not enough observers have been certified in fixed-gear lead level 2, or LL2, fisheries. Survey respondents cited too much work with low salaries as the reason for not seeking further certification, or a lack of flexibility in choosing deployments. Alaska-based observers responded that they were happy with the variety of deployment types, according to the survey. Changes are on the horizon for fishery observer coverage, though; vessel owners are beginning to install electronic monitoring devices or use electronic reporting systems. Most survey respondents said they supported electronic monitoring and reporting, though electronic systems can’t collect the biological samples that observers do. Last year was the first year that Alaska commercial fishing vessels were allowed to use electronic monitoring systems, and according to NMFS reports, it went off without a single violation on the 145 vessels that used those systems. The agency planned to open up an additional 20 spots to vessels for electronic monitoring in 2019. EM is particularly attractive for smaller vessels, where it’s hard to fit an additional person on board without leaving a crewmember behind. It may also pencil out to be cheaper; the 2018 annual report from NMFS cites an average daily cost for EM of between $956 and $1,527, while the average observer cost per sea day on a partial-coverage vessel was $1,380. The survey findings noted that the program will communicate better that electronic report and monitoring may have practical applications but that EM “is unable to replace observer coverage in all circumstances.” Elizabeth Earl can be reached at [email protected]

Local governments weigh onsite cannabis consumption options

As the Marijuana Control Board is working on hemming up the regulations for on-site consumption, local governments are wrestling with how to handle their own rules. Cannabis entrepreneurs have long awaited state regulations allowing their customers to partake at retail locations. The board approved an initial set of regulations in December, with requirements such as only allowing smoking in a freestanding building with ventilation and limitations on individual consumption. Business owners said this would provide a more reasonable place, especially for tourists, to partake responsibly without violating laws against consuming in public. Lt. Gov. Kevin Meyer signed the regulations in early March, but the MCB has a few more changes to make, including defining what a “freestanding” building is and allowing more voice for residents of areas outside the jurisdiction of a local government. However, city and borough governments are deciding whether to let the state regulations stand or enact their own. There has already been a wide variety of opinions, ranging from applying no additional regulations to completely banning it within city borders. Fairbanks has already tackled it, while Anchorage and Kenai have ordinances pending and the City and Borough of Juneau is still considering information. The Anchorage Assembly was originally set to consider an ordinance to just allow the consumption of edible cannabis products on site, but a second ordinance would have allowed smoking in facilities as long as they met other requirements, including those for freestanding buildings and ventilation. Consideration of the ordinance was postponed at its May 21 meeting. One of the snags in approving onsite consumption is the state law banning smoking in enclosed public spaces and workplaces. Under the state law, the definition could include smoke from marijuana products and outdoor areas may be permitted under the law. However, the onsite consumption rules passed by the Marijuana Control Board would allow for the smoking of marijuana products as long as the facility has proper ventilation and is freestanding, with a smoke-free area for employees to monitor the activities in the consumption area. In late April, the Fairbanks City Council adopted an ordinance to permit onsite consumption as long as licensees met the other requirements for an endorsement through the Marijuana Control Board. Fairbanks City Attorney Paul Ewers said the city would probably defer to the state’s enforcement of the non-smoking law, as it’s not a city ordinance. “If it was a city ordinance, we definitely would (enforce it),” he said. “Our approach as a city would probably look to the state attorney general.” The City and Borough of Juneau is debating the same point about the smoking law. City Attorney Robert Palmer wrote in a memo to the council that if the members want to approve the consumption of cannabis by smoking in onsite consumption endorsements, they’ll have to have a “rational argument to distinguish marijuana from tobacco” or allow both. Currently, Juneau bans all onsite consumption by ordinance, and Palmer wrote that he wasn’t aware of a tobacco consequence if the edibles portion is repealed. “However, the definition of edibles would need to be narrow to avoid vaping and other inhalation forms of consumption that can affect nearby people,” he wrote. On the opposite end of the spectrum, the Kenai City Council rejected a regulations package for onsite marijuana consumption within its city limits and introduced an ordinance at its May 15 meeting to ban it entirely. The council referred the ordinance to the city’s Planning and Zoning Commission, as it required a zoning code change, and is scheduled to hear it again June 5. “We feel this ordinance is necessary to protect public safety and welfare,” wrote council members Glenese Pettey and Jim Glendening in their co-sponsors’ memo. The Alaska Department of Health and Social Services is not currently conducting any specific research into the effects of secondhand exposure to marijuana smoke, but DHSS Commissioner Adam Crum and Division of Public Health Director Jay Butler wrote a joint opinion article in December 2018 opposing the onsite consumption of cannabis, noting that some studies indicate little difference between the effects of inhalation of tobacco and marijuana smoke. The department leans on three main bodies of existing research about the effects of secondhand marijuana smoke, DHSS spokesman Clinton Bennett said in an email. Two of the studies — one from the World Health Organization in 2016 and two from the state of Colorado in 2014 and 2016 — indicate that secondhand cannabis smoke impairs lung function and contain many of the same cancer-causing chemicals in tobacco smoke, he wrote. The Alcohol and Marijuana Control Office is seeing public comment on its draft regulation revisions for onsite consumption — including further definitions for “freestanding” and setting up a process to give residents outside a local government’s jurisdiction a way to weigh in on an onsite consumption endorsement — until June 19. ^ Elizabeth Earl can be reached at [email protected]

Marathon files permit to import LNG at Nikiski plant

After buying a mothballed liquefied natural gas export plant in Nikiski, Marathon Petroleum is planning to flip it around to become an import terminal. Marathon Petroleum, the newly-merged oil and gas giant formerly known as Tesoro and then Andeavor, owns the former ConocoPhillips LNG terminal on Cook Inlet and the refinery directly across the Kenai Spur Highway from it. In March, Marathon subsidiary Trans-Foreland Pipeline Co. filed an application with the Federal Energy Regulatory Commission to operate an import terminal at the LNG plant. The plant is about a half-mile from the proposed site of the liquefaction plant for the Alaska LNG Project, a megaproject proposed to bring stranded natural gas from the North Slope to Nikiski for export to Asia. The Alaska Gasline Development Corp., the project lead, and producer stakeholders ExxonMobil Alaska and BP Alaska have all filed motions to intervene in Trans-Foreland’s application, citing their interest in the Alaska LNG Project as justification. “AGDC may be affected by the modifications to, and ultimate use of, the Kenai LNG Plant for which authority is sought in this docket,” AGDC’s motion states. “AGDC is an interested party that may be affected by Commission action on this application. AGDC’s interests are not adequately represented by any other party, and its intervention is in the public interest.” AGDC spokesman Jesse Carlstrom referred back to the language on the motion when asked to clarify how the project would be affected by Trans-Foreland’s proposal. He said AGDC’s motion to intervene was made independently of other parties. ExxonMobil did not respond to a request for comment. BP spokeswoman Megan Baldino said the language used in the motion to intervene is standard practice. “BP filed the intervention basically to reserve our right to comment in the FERC process,” he said. “Interventions like this are fairly common.” Trans-Foreland’s application states that it wants to import LNG to use in a cool down project for the terminal. The facility is currently in a warm idle status and the LNG would be used to bring parts of it back into active status — the liquefaction side would remain in warm idle status. The modifications wouldn’t require any expansions of the existing footprint of approximately 161 acres, according to the application. In addition, the boil-off-gas — a byproduct of re-gasifying LNG — could be delivered to the nearby refinery to power its operations, according to the application. “After completion of the Project, the Kenai LNG Plant will be able to deliver up to 7,000 MMBtus (million British thermal units per day), with the average delivery of approximately 5,000 MMBtus/d to the Refinery,” the application states. One million British thermal units are roughly equal to a thousand cubic feet, or mcf, or natural gas. Delivering the gas to the nearby refinery would reduce Marathon’s need to buy gas from the local utilities, Homer Electric Association and Enstar Natural Gas Co., to run its operations. The refinery is one of the area’s biggest industrial consumers of natural gas. HEA declined to comment on Trans-Foreland’s application. Currently, the main natural gas producer in the Cook Inlet area is Hilcorp, which owns many of the offshore oil and gas producing assets in Cook Inlet and a number of onshore pads. HEA’s only firm contract for natural gas is with Furie Operating Alaska — which operates the offshore Kitchen Lights Unit in central Cook Inlet — but Furie has had production issues and failed to deliver on its gas contract obligations for months this spring. The utilities covered the lapse with spot market purchases and stored gas in the joint Cook Inlet Natural Gas Storage Alaska facility known as CINGSA. Gas production in Cook Inlet declined sharply from 2005 to 2012, prompting the state to pass tax credits aimed at revitalizing oil and gas development in the inlet. Utilities in the area, concerned about gas shortages, began to look for options to import LNG or compressed natural gas in 2012, according to a Northern Economics report on the Cook Inlet oil and gas industry published in 2014. Generally, oil and gas is more expensive to develop in Alaska than elsewhere. A March 2018 report from the Alaska Department of Natural Resources noted that there are significant gas reserves remaining in Cook Inlet, but they would only be economic to develop at prices of around $6 to $8 per mcf or more. Recent Hilcorp supply contracts have been in the neighborhood of $7 per mcf. The estimated volumes identified in the Inlet could supply demand through 2030, according to the report, but costs to develop it will also likely rise. Worldwide, natural gas prices have been falling as more production comes online. The U.S. Energy Information Administration projects production to continue growing both domestically and internationally through 2019 and 2020, putting downward pressure on prices. Marathon wouldn’t be able to purchase LNG from U.S. Gulf Coast suppliers because there are no U.S.-flagged LNG tankers in operation, and the Jones Act requires ships traveling between U.S. ports to be built, crewed and flagged here. LNG export terminals are planned but not currently in operation on Canada’s west coast. Trans-Foreland has not yet filed the request to import LNG but plans to do so by the end of the third quarter of 2019, aiming for a first delivery of natural gas by August 2020, according to its application. The existing application does not identify a specific amount of gas the company is seeking to import. Marathon had not responded to a request for comment by deadline. Elizabeth Earl can be reached at [email protected]

Legislature passes bill repealing most telecom regulations

One of the handful of bills that passed through the Legislature this year updates many of the state’s regulations on telecommunications companies. Senate Bill 83, sponsored by Sen. Chris Birch, R-Anchorage, successfully passed the House and the Senate May 14, the day before the regular session ended and the Legislature moved into a special session; it now awaits the governor’s signature. The bill repeals a number of statutes regulating telecom providers, including ratemaking authority, standards for equipment and services and Carrier of Last Resort, or COLR, regulations, which are designed to protect rural communities in the event that all telecom providers want to stop serving an area. Telecommunications companies in Alaska broadly backed the bill, saying it would free up resources for them in an increasingly competitive environment. The Regulatory Commission of Alaska supported it as well, with the sole opposing vote coming from chairman Stephen McAlpine. RCA staff, however, raised a number of concerns about the future for telecom service across Alaska if the bill becomes law. The members of the Alaska Telecom Association, who range from statewide providers like Alaska Communications to small local telephone companies, argued that economic regulation of telecommunications providers is outdated, clumsy and consumes resources that could be better put toward operations. Christine O’Connor, the executive director of the ATA, noted that the statutes have not been fully updated in about three decades. “We tried to tackle that starting in 2014 with a petition to the Regulatory Commission,” she said. “They made some minor changes, but it didn’t end up relieving the burden. Some companies ended up with more complexity, not less. They had those petitions in 2014, and five years later we said let’s just do a full cleanup of these statutes.” The telecom market has become more competitive in Alaska in recent years, with consumers increasingly preferring mobile and web-based communication services as opposed to traditional landlines. Landlines are still important, though; O’Connor said approximately 4 percent of Alaskans depend solely on landlines, while 48 percent still maintain one in addition to another service. As the market shifts, the traditional monopoly-style regulation of telecoms becomes outdated for everyone, she said. Under the new regulations, telecommunications providers would no longer have to file informational tariff reports with the RCA. The filings are to inform the RCA of intended changes rather than to request rate increases, and the companies argued that the filings are time-consuming and unnecessary. GCI, one of the largest carriers in the state, spends significant time on filing the tariffs with the RCA, said Heather Handyside, vice president of corporate communications and community engagement for GCI. The company, which began as a landline provider about 40 years ago, has a dedicated team that sinks significant time into producing the reports, she said. “We all can understand here in Alaska how dramatically telecommunications have changed in the last 40 years,” she said. “The regulatory environment hasn’t changed in 30 years, and we’re still operating today with regulatory guidance from 30 years ago. That’s really a part of what SB 83 does: eliminate the onerous and unnecessary paperwork that our company does.” The bill does not mean the telecom providers will disengage entirely from the RCA, Handyside said, but it will “streamline” the process for everyone. It would also eliminate statutes requiring utilities to charge “just and reasonable” prices, removing RCA oversight over rates, and repeal the ability of the RCA to designate a Carrier of Last Resort. Companies argued in their letters and presentations that the Federal Communications Commission will still hold requirements for companies seeking to leave an area to justify it, but the RCA staff raised concerns about the potential for loss of service in rural areas. In documents submitted to the Legislature, ATA argued that COLR creates uncertainty for carriers because the RCA can change it at any time. In a memo to the RCA, Common Carrier staff member David Parrish outlined concerns about many of the items in the ATA’s proposed bill, highlighting particularly the elimination of economic regulation, the elimination of COLR regulations and how the changes would impact RCA’s ongoing review of its subsidy program, known as the Alaska Universal Service Fund. In letters and presentations to the Legislature, telecom providers mentioned how a number of states in the Lower 48 have taken similar actions to deregulate their telecommunications providers. The RCA staff memo contested that the situations in the Lower 48 and Alaska are the same. “What has not been clear is whether those states have taken the approach of completely deregulating even the least competitive markets within their respective jurisdictions,” the memo states. “ATA has not indicated that other states have so limited the enforcement tools available to their utility commissions for whatever jurisdiction those commissions retain to render that jurisdiction de facto unenforceable.” In the event the Legislature passed the bill, the staff memo recommends the RCA immediately open rulemaking processes to reinstate some of the provisions eliminated from statute. In a House Labor and Commerce hearing on May 1, McAlpine told legislators that his primary motivation for opposing the bill was concern about service in rural Alaska. In a May 13 hearing, Rep. Jonathan Kreiss-Tomkins, D-Sitka, shared similar concern with the House Judiciary Committee, saying the bill was moving quickly and could have impacts on residents like those in the rural areas of Southeast. “These communities for the main part don’t have cell phone service,” he said. “Landlines are the only means of communication these communities have. So therefore, it becomes a life and safety issue, as well as a commerce issue.” The House Labor and Commerce Committee added an amendment to allow the RCA more flexibility to hire on a telecommunications industry expert, which it does not currently have. Rep. Adam Wool, R-Fairbanks, co-chair of the committee, said a number of people had approached him about a “brain drain” at the RCA because of more attractive jobs in the private sector. O’Connor said the bill will result in immediate time and cost savings, especially for small providers that may have to bring in consultants to complete the filings required by the RCA. The RCA staff memo referred to the bill as deregulation, and O’Connor said the industry and ultimately the commissioners disagreed with that analysis. “I would say it’s just a difference of philosophy,” she said. “I’m on the record at the RCA saying that we felt it was time to update these statutes. This one staffer said he felt like it’s a go in another direction. Naturally since our goal was to become more efficient and we were responding to a lot of comments over time … saying we’re doing a lot of work here on telecommunications here that’s outdated and needs to be stripped away.” The amended bill passed the Legislature on May 14 and awaits transmittal to Gov. Michael J. Dunleavy for his signature. Elizabeth Earl can be reached at [email protected]

Alcohol, marijuana officers still blocked from public safety networks

Editor's note: This story has been corrected to state that the chairs of the alcohol and marijuana control boards sent a letter to the commissioner of the Alaska Department of Commerce, Community and Economic Development, who sent a letter to the state Attorney General. Enforcement officers with the Alcohol and Marijuana Control Office are still struggling to work around the loss of access to the state’s public safety information networks. The office employs a number of enforcement personnel to inspect licensed premises and to investigate potential violations. The majority of the office’s work is in alcohol licenses, though marijuana licensees take up an increasing portion of staff time. Until December 2018, the enforcement staff members were considered peace officers and had access to the Alaska Public Safety Information Network and the Alaska Records Management System. However, last fall, the Alaska State Troopers informed AMCO that its enforcement officers would no longer have access to those networks because they were not considered peace officers. DPS could provide the information, but the AMCO staff would be locked out. About five months later, the AMCO staff members are still struggling to get the information they need to conduct investigations, said Executive Director Erika McConnell. “Some information has been provided in a timely manner,” she told the Marijuana Control Board during its meeting May 1. “Some requests have been ignored or go unfilled after repeated requests. This continues to be a frustration for the office.” The state provides access to the networks to criminal justice agencies and to peace officers. It is a debatable point whether AMCO is a “criminal justice agency,” McConnell said, but enforcement staff have always been considered peace officers. She said the reason the interpretation has been changed is still unclear. Though the chairs of both the Alcohol and Marijuana Control boards wrote a letter to the commissioner of the Alaska Department of Commerce, Community and Economic Development requesting that he send a letter to Alaska Attorney General Kevin Clarkson requesting a clarification, there has been no response as of the May 1 meeting, said Marijuana Control Board chairman Mark Springer. Division of Enforcement Director James Hoelscher noted that the lack of access hampers the enforcement officers at AMCO despite the fact that the departments have the same goal. The investigators within AMCO have police backgrounds for inspection purposes. “It’s been burning — it’s been something in the back of my head for quite some time now and caused significant issues and questions,” he said “In my opinion, it is very clear that we are peace officers. What it boils down to is you have enforcement who is required to enforce Title 4 and Title 17 and we have been hamstrung on almost every level of the way to do that thing.” The Department of Public Safety did not reply to a request for comment as of press time. Impacts of legalization examined Meanwhile, AMCO is working on a data-sharing project of its own with the Alaska Department of Health and Social Services’ Division of Public Health. As part of the plan to legalize recreational cannabis in Alaska, the Legislature set up an excise tax with 25 percent going to marijuana education and treatment programs. The DHSS is working on issuing grants to promote youth education and substance abuse prevention, but as part of its education programming wants to conduct monitoring on the effects of marijuana legalization in the state, according to an outline submitted to the Marijuana Control Board. “Surveillance of youth and adult populations monitor trends in knowledge, awareness, attitudes, behaviors and use in the population,” the outline states. “We have incorporated marijuana-specific questions in our existing surveys to get a sense of how these attitudes and behaviors may change over time. Data from these surveys informs public health activities, providing the evidence behind evidence-based approaches to changing behaviors.” Part of the system for tracking commercial cannabis involved serial numbers for each plant, known as the Marijuana Enforcement Tracking Reporting Compliance, or METRC. DHSS wants to use the data there to track retail sales to see what types of products Alaskan adults are buying, while protecting licensee information. According to a draft data use agreement, the division wants information such as the price per usable gram, the value of sales, the number of transactions, the sales by product type, the average percentage of THC per gram and the number of sales by product type, among other data points. Eliza Muse, the acting director of the Office of Substance Misuse and Addiction Prevention, told the Marijuana Control Board that the division is keeping an eye on how use is affecting health of the Alaska population at large. “We’re also monitoring population health status to identify trends and potential health outcomes related to marijuana use,” she said. “We’re tracking data points such as marijuana-impaired driving or motor vehicle crashes, calls to our poison control hotline related to accidental ingestion, tracking emergency room treatment for children and the number of people entering treatment with marijuana identified as the primary substance of concern. “I do want to say that we have a lot of data points pre-legalization and post-legalization and we are not seeing an increase in any of those areas right now.” The Marijuana Control Board plans to review the data use agreement with DHSS at its July meeting. Elizabeth Earl can be reached at [email protected]

No plan for Seward coal terminal three years after last shipment

Nearly three years after it went dark, the future of the Seward Coal Loading Facility is still unclear. The conveyor-belt loading dock extends out into Resurrection Bay from a yard near the Alaska Railroad Corp.’s terminal in Seward. From 1984-2016, it was used to load export shipments from the Usibelli Coal Mine near Healy. At its peak in 2011, the railroad moved about 200 coal trains back and forth to supply export demands, and the operation employed about 100 people between operator Aurora Energy Services, the railroad and Usibelli, according to information from the Alaska Railroad Corp. That changed in 2016, when the railroad decided to shutter the facility indefinitely after years of coal export declines. By that time, exports had decreased about 95 percent from a peak of 1.1 million metric tonnes in 2011 to 68 tonnes in 2016, only serving one ship as opposed to the 18 required in 2011. Cheaper coal from Indonesia and Australia pushed down the market price, cheaper natural gas entered the scene and the U.S. dollar was very strong, making it harder for Usibelli’s export business to pencil out. With that little volume, the railroad corporation operated the facility at an approximately $1.2 million deficit, according to the 2016 document announcing the closure. The facility isn’t useful for much else, but would remain intact for now, according to the announcement. “While unsuitable for unloading passenger vessels or cargo ships, the SLF dock can provide mooring services,” the announcement stated. “In light of the railroad’s mission to foster economic development, the facilities will be left intact for now to facilitate resumed operations in support of our customer if new opportunities arise. That meant Usibelli’s coal would be kept in Alaska to supply the state’s six coal-fired power plants. At its peak, about half of the mine’s production was being exported, so the operations took a hit when the export market disappeared. The company still views it as a temporary halt in its exports and is constantly looking for ways to reenter the market, according to Lorali Simon, the vice president of external affairs for Usibelli. However, the railroad corporation’s decisions about its coal operations have made that a higher threshold, she wrote in an email. “The Railroad, who has experienced tough financial circumstances for many years, made certain decisions regarding the Seward Facility that make it difficult to respond quickly to export opportunities,” she wrote. “The Railroad sold the coal cars used for the export business; (and) the Railroad put the facility into ‘cold storage.’ It will take capital (both time and money) to get the facility back up and running.” In 2016, the railroad corporation estimated that it would cost about $200,000 to bring the facility back online, take a 30- to 90-day lead time and require about eight shiploads annually to break even. However, that was before some of the coal cars were sold. In its 2016 announcement, the railroad corporation stated that it offered the aluminum coal hoppers to Usibelli for purchase, but the coal company declined. The railroad corporation does still maintain a fleet of coal cars. Though the railroad corporation does not have updated figures, it’s likely more expensive than that to get the facility online again, said Tim Sullivan, the director of external affairs for the railroad. “It’s probably a little bit more than that now,” he said. “If you leave it to lay fallow for a while, the costs go up.” Sullivan didn’t have an estimate available for what it would cost to dismantle the facility. At this point, the railroad’s plans for the coal loading facility haven’t changed, he said. Though it can’t be used for much else, ships can moor to it if necessary although that has been infrequent. The railroad has been reevaluating its facilities in Seward in recent years, aiming at repairing the passenger and freight docks, but those plans don’t really affect the coal loading terminal at present. The loss of the coal exporting business hit both companies in the wallet. Usibelli, which in 2011 employed 150 people, today employs about 100 people. Most of those employees have been lost through attrition rather than layoffs, Simon said. “Since roughly 30 percent of our employees are second-, third-, and fourth-generation employees, and the average tenure was close to 15 years in 2011, many folks naturally retired,” she wrote. The railroad corporation has taken hits in several markets in recent years, with a decline in the coal export business and in the oil field. Freight makes up the majority of the railroad’s revenue, with much of that coming from shipping materials north for oilfield explorations. Though the oil patch has been rebounding with increased exploration on the North Slope and potential new exploration in the Arctic National Wildlife Refuge, the last few years have still been financial tough on the railroad; its workforce has declined by about 100 to 150 year-round employees, Sullivan said. “We’re focused on the services that we continue to provide,” he said. “We saw the export coal market reduced and went away, and at the same time we were seeing the refined jet petroleum coming down from the North Pole refinery … decline and then disappear as well. It was a couple big hits for the Alaska Railroad. We’ve taken measure of those issues and we think we’ve gotten to a point where we can continue to weather what’s going on.” Since the beginning of the year, average coal prices on the market have declined, with production so far in 2019 about 7.2 percent behind the production at the same time in 2018, according to the U.S. Energy Information Administration. The long-term projections are for coal’s share in the U.S. energy generation sector to decline between the present and 2050, giving way to renewables and natural gas, according to the EIA’s 2019 Annual Energy Outlook. The U.S. is expected to continue to be a net coal exporter, but the actual amount of coal exported is not expected to increase because of competition from other producers closer to global markets, according to the outlook. At the same time, in the years since the Seward Coal Loading Facility closed, the federal administration has drastically changed to one much friendlier to coal. President Donald Trump’s administration has made several moves to change rules previously set in place during Barack Obama’s administration, including moving to reduce restrictions on emissions from coal-fired power plants. Congress also invoked the Congressional Review Act to repeal the Stream Protection Rule put in place during the Obama administration. Simon noted the repeal of the Stream Protection Rule and said the reduction in regulations “has allowed the mining industry to get back to work.” Elizabeth Earl can be reached at [email protected]

Study pinpoints trend toward fisheries specialization

Commercial fishermen in Alaska have gotten older in the past three decades. As it turns out, they’ve become more specialized, too. Fewer permits overall are in the water; between the early 1990s and 2014, commercial fishing permits in Alaska decreased by 25 percent. On top of that, fewer individual fishermen are moving between fisheries. From 1988-2014, the number of individuals holding multiple permits declined from 30 percent to 20 percent, according to a study published in the journal Fish and Fisheries. The bottom line: fishermen are increasingly putting all their economic eggs into one basket, and that makes them more vulnerable to the ups and downs of fishing. The study was born out of a workgroup that met through the National Center for Ecological Analysis and Synthesis at the University of California Santa Barbara, said co-author Anne Beaudreau, an associate professor of fisheries at the University of Alaska Fairbanks. The original intent was to study the long-term effects of the 1989 Exxon Valdez oil spill, but the data on fisheries specialization arose out of that work, she said. “As we worked on this, we realized there are so many things that have caused long-term changes in the Gulf of Alaska; in the fisheries, it’s really hard to see the long-term effects of the oil spill,” she said. “A lot of the focus of the working group was on the biological effects … this paper sort of came out of the end of that.” The group examined case studies in commercial fisheries: the Prince William Sound herring fishery, the statewide Pacific halibut fishery, salmon fisheries in Bristol Bay and in Prince William Sound, and fisheries in the region affected by the Valdez spill. All the fisheries have their own driving dynamics and factors of change, but common threads among many of them were long-term participation declines and increasing specialization. Some of that may be loss of opportunity; the cost of entering fisheries has steadily increased as limited entry and fishery rationalization have come into play in Alaska fisheries. Some of the fisheries in the case study are also not available due to losses in populations. The herring fishery in Prince William Sound, for example, crashed a few years after the Valdez spill and has never truly recovered. This is not an across-the-board trend, though. Some fishermen have been able to look elsewhere as their fisheries change, Beaudreau said. “I would say that fishermen are really good at diversifying,” she said. “I think that tends to be part of the nature of commercial fishing. You’re dealing with a lot of uncertainty — changes in fish populations, changes in regulations, changes in markets — all these are pressures that commercial fishermen are really good at responding and adapting to … For somebody, (finding opportunity) might mean specializing in something. For others, that might mean diversifying.” Specialization doesn’t always mean immediate impacts. For Bristol Bay, where sockeye salmon reign supreme, fishermen have actually seen less variability in their income and higher overall income. However, the point is the long-term fragility. Sockeye salmon are vulnerable to ocean forces, as was seen in the lower-than-expected returns across the Gulf of Alaska in 2018 that left fishermen in Kodiak, Chignik, Cook Inlet and Prince William Sound holding loose nets for much of the season. But the long-term warning flags of fishery instability remain, Beaudreau said. “I think it’s really more of the longer term concern,” she said. “If you’re putting all your eggs in one basket, what happens if there’s some major impact to sockeye populations?” The specialization study is the latest in a spate of research in recent years on cost of entry, reduction in opportunity and the increasing average age of commercial fishermen in the state known as the “graying of the fleet.” Fishermen statewide have noticed a trend among their peers that fewer young people are getting into the industry, but the studies lend statistics to back up observations and support potential legislative fixes. The study cites the work of another UAF researcher, Courtney Carothers, several times in reference to the impacts of the Pacific halibut fishery particularly. Carothers and a group of other researchers produced the 2017 “Turning the Tide” report, highlighting a number of the issues in loss of fishery access in rural communities and what that means for the future of those communities and the Alaska fleet. Since the implementation of limited entry programs in the 1970s, the number of rural residents holding permits in their local state fisheries has declined by 30 percent, and halibut quota holdings by locals in rural communities has fallen 50 percent since the implementation of the individual fishing quota, or IFQ, program in 1992 according to the Turning the Tide report. Much of that is due to the cost of permits in a limited entry fishery or shares in an IFQ fishery such as halibut or Bering Sea crab. Among the recommendations produced in that report were facilitating nonmarket-based access to commercial fisheries, establishing youth or student access licenses or mentorships programs, implementing programs to protect rural access to fisheries, supporting infrastructure to maintain fisheries and establishing a statewide fisheries access taskforce. Though lawmakers have expressed interest in it, legislation addressing these issues has yet to make it into law. One bill introduced in 2017, House Bill 188, would have established regional fisheries trusts allowing communities to form trusts to purchase commercial fishing licenses communally and lease them to fishermen who would otherwise not be able to afford them. After receiving a number of hearings, the bill was held in the House Labor and Commerce Committee and has not been revived in the current session. Beaudreau said her group’s study did not highlight potential solutions but rather shed light on the problem — and, among other items, how salmon fisheries can serve as a baseline fishery for commercial fishermen across the state. “Basically, we kind of saw salmon as a safety net, and it just speaks to how important it is for Alaskans,” she said. Elizabeth Earl can be reached at [email protected]

Emerging mariculture industry seeks to streamline permitting

Alaska may be famous for its wild fish, but some are working to make room in the state’s waters for more shellfish, kelp and crabs on aquatic farms. Mariculture is a hot topic in fisheries right now. Essentially, mariculture can be defined as the cultivation of plants or animals in controlled saltwater environments, but in Alaska it doesn’t include finfish, as that’s illegal in the state. So mariculture farmers have stuck to primarily kelp and oysters so far, but they’re starting to get more adventurous. As of December 2018, 58 aquatic farms were operating in the state along with five hatcheries and seven nurseries, though only 41 of the farms documented production in 2017, according to the Alaska Department of Fish and Game. Oysters are still the most widely grown product, though kelp is gaining ground; after the first operations for kelp were permitted in 2016, four farms had produced 16,570 pounds of ribbon and sugar kelp by the following year. A major obstacle remaining, though, is the regulatory hurdle to get an aquatic farm permitted. A bill in the Legislature — House Bill 116 — would trim down some of that procedure with an eye toward getting more operations out the gate. The bill, sponsored by representatives Andi Story, D-Juneau, and Jonathan Kreiss-Tomkins, D-Sitka, would fast-track permit renewals for farms in good standing for their first renewal cycle, which covers 10 years. Story clarified in a hearing before the House Fisheries Committee on April 23 that it would make no changes for salmon hatcheries, which operate in the state largely without saltwater net pens. There’s been a recent surge in license applications to the state for aquatic farms, increasing the wait time, Story said. “Because of the recent increase in the number of aquaculture farm leases … it now takes on average 18 months or more to approve an aquatic farm lease,” she said. To obtain a permit, the applicant first has to apply to the Alaska Department of Natural Resources for the use of the tidelands, which requires a 30-day public review and comment period and may require a site survey by ADFG. After the public comments are compiled and evaluated, DNR and ADFG issue a final decision. If the permit is denied, the applicant can appeal; if it’s approved, the permit is good for 10 years. The DNR permit’s annual fees are $450 or $875 for the first acre and $125 for each additional acre, with a $2,500 minimum performance bond required and a commercial use requirement by the fifth year with $3,000 per acre or a $15,000 max per farm site. ADFG requires an annual operating report for each species cultured as well as permits to acquire and transport wildlife. On top of that, to harvest and sell food products, the Alaska Department of Environmental Conservation requires that the operator obtain a water qualify classification, conduct shellfish sampling for paralytic shellfish poison and obtain shellfish processing permits, according to documentation submitted to the Legislature. It can be expensive and time-consuming. Meta Mesdag, co-owner of Salty Lady Seafood Company in Juneau, told the committee members that it’s taken about $150,000 of investment so far for her family’s approximately 1-acre operation growing geoduck clams and oysters. “(Oysters) take about three years to grow, and the geoduck will take seven,” she said. “Unfortunately, we only have five years left on our lease so we won’t see any revenue from our geoducks before we have to go through the renewal process all over again.” The Alaska Fisheries Development Foundation, which promotes the exploration and development of fisheries throughout the state, credited the work of the state Mariculture Task Force with the growth in interest. In a letter of support for HB 116, the foundation noted that the vetting process for renewing a permit slows down the process for new applicants. “HB 116 is important step toward efficiently developing a mariculture industry in Alaska,” wrote AFDF Executive Director Julie Decker in the letter. “HB 116 will allow for one renewal of an aquatic farm site through a simpler internal process which does not require public comment, if the lease is in good standing/compliance. However, the second renewal would still be required to go through the extended process similar to a new application.” The Mariculture Task Force, established by Gov. Bill Walker in 2016 after the Alaska Fisheries Development Foundation obtained a federal grant in 2014 to fund its Alaska Mariculture Initiative, developed a strategy released in March 2018 aiming to make Alaska’s mariculture industry worth $100 million in the next 20 years. The industry produced about $1.5 million in sales annually in the state in 2017. In the future, the primarily revenue drivers would be oysters, seaweed and geoduck clams, with smaller markets in mussels, sea cucumbers and king crab, according to the group’s Mariculture Development Plan. The primary recommendations the group produced are securing seed supply through hatcheries, passing state legislation to help fund hatcheries through the mariculture revolving loan fund and allow shellfish enhancement and filling several research and coordination positions for mariculture, among other goals. Alaska is significantly behind the Pacific Northwest in mariculture development. Some farms in Washington operate thousands of acres and employ hundreds of people. Taylor Shellfish Farms, which has been operating in the Seattle area since the 1890s, employs about 500 people and holds leases on more than 10,000 acres of tidelands in Washington. Some commenters raised a concern about the size of farms in the future. DNR does not currently have a size cap, other than that a farm cannot take up more than a third of the bay or inlet where it is located. Though the DNR considers risks like navigation hazards when reviewing farm permits, the agency is starting to consider ways to address concerns about farm size, said Christy Colles, who manages the shore leasing program for the Division of Mining, Land and Water, during the House Fisheries Committee meeting. “These new farms at this magnitude are by and large new to the state,” she said. “We haven’t really had much of a chance to think about how we can address those.” “Large” is a relative term in Alaska compared to the enormous operations in the Lower 48, said Mark Scheer, who operates Premium Aquatics near Craig, farming kelp and Pacific oysters. Though he said his lease is for more than 100 acres, he doesn’t use all of it at once. “I think it’s important to recognize that this is a new transition for Alaska,” he said. “The relative scale of what we’re doing here is modest at best.” HB 116 was passed out of the House Fisheries Committee to the House Resources Committee, scheduled for its next hearing on May 3. Elizabeth Earl can be reached at [email protected]

Cook Inlet setnet buyback program gains support

Cook Inlet fishermen are again pushing for a bill that would authorize a commercial set gillnet permit buyback, but with the budget battles ongoing, it may not advance this year. Senate Bill 90 is the latest version of the plan to set up a buyback program for setnet permits on Cook Inlet’s east side. About 440 permits exist on the east side, targeting primarily sockeye salmon with secondary catches of king salmon headed for the Kasilof and Kenai rivers. The bill, sponsored by Sen. Peter Micciche, R-Soldotna, aims to permanently remove up to 200 permits and their shore leases from the fishery. The fishermen have been debating a way to reduce the fleet for about four years, surveying stakeholders for support and working with Micciche to authorize a program to do so. The latest version of the bill would require a confirming vote by the fishermen, a voluntary signup for the program and would seek funding other than the state General Fund. With a set price of $260,000 per permit, the whole program would cost $52 million. “There are some private endowments that have mentioned some interest because of the conservation; there are federal programs that participate in conservation efforts,” Micciche told the Senate Resources Committee in a hearing April 22. “This is going to take some time to be ready with the election and settling any of the appeals and whatever goes with it, but the state is not paying for any of this. This is going to come from other sources that we’re not sure of at this point.” The conflict between fisheries user groups in Cook Inlet is notorious statewide. The Kenai River draws thousands of anglers from all over the world for its salmon runs, while commercial fishermen ply both the beaches and the Inlet. Personal-use dipnet fishermen come from all over the state each summer for the fisheries at the mouths of the Kenai and Kasilof rivers. As king salmon runs declined and both commercial and sport fisheries have been restricted in response, the allocation conflicts have become more pitched. Micciche said this bill is intended to help reduce the allocation conflict, allow more king salmon to make it through to spawn and make the remaining setnetters more economically viable. In an example of rare cooperation, multiple groups have come together to support the effort, he said. If the Legislature approves the bill, the initiative would go to a vote among permit holders. If they approve it, permit holders could put their names into a lottery to be drawn for the buyback. The bill also redefines the areas of the buyback, sectioning off the Cook Inlet East Side setnetters as Upper Subdistrict fishermen that are distinct from setnetters in the Northern District or on the west side of the Inlet. In the past, the Kenai Peninsula Fishermen’s Association, which represents the East Side setnetters, has been wary of bills establishing a buyback program. After taking surveys and working with Micciche on the language, the association offered its support for Micciche’s version of the bill, said Andy Hall, the president of the association’s board. That doesn’t mean every person in the fleet supports the concept, but the survey brought back about 70 percent to 80 percent support, he said. The price tag for the buyout may seem high to some people, Hall said, but it’s based on 10 years of average earnings and was closed to adjustment at the end of December 2018. Removing gear from the fishery will likely have an immediate financial benefit for the fishermen who are left. “We’re not looking to be martyrs; we’re business people,” he said. “If we’re going to step away, we want to be remunerated for it.” One source of contention is how so many fishermen wound up on the east side of the Inlet to begin with. Commercial fishermen are issued permits for Cook Inlet in general, and though they were more widely distributed across the west side, east side and Kalgin Island before the 1980s, they began migrating to the east side because of the accessibility of the fishery and the proximity of processing facilities in Kenai, Kasilof and Ninilchik. Fate Putnam, the chair of the Commercial Fisheries Entry Commission, told the Senate Resources committee that the days of the East Side fishery being highly profitable are gone, though. “I will say this: There was a time about 20 years ago that these fishermen were making about $100,000 (per permit),” he said. “Now they’re making about $11,000.” However, the Senate Resources committee members expressed some hesitation about forwarding the bill on. Senate President Cathy Giessel, R-Anchorage, who sits on the committee, proposed an amendment requiring anyone participating in the buyback to have held the permit for at least 10 years and have fished actively at least five of those years. Her goal was to prevent speculation or system-gaming, she said. Micciche said the amendment could effectively kill the program, as many of the fishermen who want to participate have held their permits for less than 10 years. Permits are swapped every year in fisheries; according to information provided by Putnam to the Legislature, an average of 58 setnet permits in Cook Inlet in general are transferred each year. The ratio of permits being transferred is similar to other fisheries and hasn’t changed much over the years, suggesting that there isn’t much speculation going on about the buyback, Putnam wrote in a memo to the Senate Resources Committee. Speculation may happen, but that’s normal in fisheries, Micciche told the committee. “People speculate on fishing permits. That’s what they do,” he said. “We don’t care which permits they are — we just want 200 out. And if you don’t pass the vote, you don’t get the buyback and you don’t get the extra fish in the rivers.” During an April 29 hearing, the Senate Resources Committee moved SB 90 out of committee after amending it to require anyone participating in the buyback to have held the permit for at least four years and have fished for two of those years. The new amendment, proposed by Giessel, was intended to be a middle ground to prevent speculation but to still allow the program to continue. Micciche said the adjustment better served the intention to prevent speculation, and the committee passed the amendment and the bill without objection. Ken Coleman, who fishes a setnet site near the Kenai River and is one of the proponents of the buyback program through the East Side Consolidation Association, said he hopes to see the bill climb through the Legislature this year, but it still has a long way to go through even the Senate before it goes to the House. Several committee members expressed concern about funding, and though Micciche said the fishermen have no intention to seek state funding, they need a program established by a bill first before they can apply for funding elsewhere. Konrad Jackson, Micciche’s chief of staff, said he plans to keep working to get the bill heard, but with less than three weeks left before the Legislature’s 121st day and major budget items still to be debated, it’s unlikely the bill will make it far this year. Coleman said they may be able to seek federal funding, even though the fishery is not in federal waters. “I’ve had several talks with the federal delegation about funding, and also had talks with (The National Oceanic and Atmospheric Administration) about their capacity reduction program,” he said. “To the extent we can seek funding, we have to have a work product. I’ve been in discussion with the federal delegation, and they’re amenable to seeking funding, but we need a bill.” Elizabeth Earl can be reached at [email protected]

Multiple bills aim to expand telehealth services in Alaska

Medical providers may have more options for offering services digitally if the Legislature approves a set of bills targeted at expanding telehealth availability. Telehealth includes a variety of services delivered by the provider communicating digitally with a patient or transmitting data such as imaging scans. In a state like Alaska, where much of the population is spread thin and medical providers are concentrated in urban areas, telehealth has the potential to connect those who live in rural areas or without reliable or affordable transportation to regular medical care. When the Legislature reformed the Medicaid program in 2016, one provision required the state Medical Board to create regulations for physicians to diagnose, prescribe and administer prescriptions without conducting a physical examination on a patient. That allowed doctors to begin offering a broader array of services. In the intervening years, a number of telehealth services have popped up in the state and some insurers, including Premera Blue Cross Blue Shield, offer coverage for telehealth services for members in Alaska. A suite of bills in the Legislature would expand telehealth services further. House Bill 29, sponsored by Rep. Ivy Spohnholz, D-Anchorage, would allow providers to bill state-regulated insurers for health care services delivered by telehealth without an initial in-person appointment. HB 97 and its companion legislation Senate Bill 44 would allow physician assistants to deliver telehealth services under the same statutory regulation as physicians. None of the bills have received much opposition, and providers and insurers have come out in support. Telehealth is billed as a way to improve access to care and potentially decrease costs by delivering them more effectively and through preventative care visits. “We need to look at the overall cost of health,” said Division of Insurance Director Lori Wing-Heier in a House Labor and Commerce Committee hearing on April 24. “We need to look at ways to reduce the cost of health care while expanding access … This is an excellent way to do that.” Spohnholz told the House Labor and Commerce Committee that the bill allows for reimbursement to any provider who delivers services via telehealth, not just telehealth-specific companies. Teladoc, a New York-based telemedicine company, already offers services in Alaska and supports the bill. The company contracts with Premera and the AlaskaCare Employee Health Plan, which covers State of Alaska employees, among other health plans. Claudia Tucker, the vice president of government affairs for Teladoc, told the committee in an April 29 hearing that telemedicine services saved Alaskans $3.5 million in health care costs in 2018. One of the concerns committee members had is where the doctors who are answering the calls are located. Tucker said while the company has a preference in the state for doctors who live in Alaska, they aren’t always available. “About 30 percent of (Alaska-based) calls were answered by physicians who lived in Alaska,” she said. “All of them are answered by physicians licensed in Alaska.” Robin Minard, the chief communications officer for the Mat-Su Health Foundation, said two of the major barriers to care identified in the Mat-Su Regional Medical Center’s Community Health Needs Assessment are lack of access to care and transportation. Expanded telehealth options would help address both, she said. The Alaska Commission on Aging also noted this in a letter of support. Medicare does not currently allow for telehealth visits to be reimbursed, but an expanded program from the Centers for Medicare and Medicaid Services called Medicare Advantage would allow telehealth services delivered in a recipient’s home to be reimbursable, commission chair Gordon Glaser and executive director Denise Daniello wrote in the letter. “Medicare Advantage is not yet available in Alaska, however, there has been growing interest in exploring managed care plans as a means to control costs in our State,” they wrote. “The Commission on Aging will be following these developments.” HB 97, sponsored by Rep. Jonathan Kreiss-Tomkins, D-Sitka, and SB 44, sponsored by Senate President Cathy Giessel, R-Anchorage, both seek to include physician assistants in the regulations on telehealth delivery. The intent of the original revision to Medicaid was to include them, but the state Medical Board wanted specific mention of physician assistants, according to a letter to Giessel from board President Catherine Hyndman. Most of Interior Alaska is considered a medically underserved area with a health professional shortage, according to the Health Resources and Services Administration. Physician assistants are allowed to prescribe schedule 2 to 5 substances and be supervised by a doctor in order to practice medicine. The House Labor and Commerce Committee passed HB 29 out of committee but was waiting for amendments on HB 97, which were due May 2. The Senate Finance Committee passed SB 44 out of committee on April 15. ^ Elizabeth Earl can be reached at [email protected]

Reps apologize after last-minute charges sink Johnstone nomination

Editor's note: This story has been updated with a list of names provided to the governor by the Alaska Marijuana Industry Association for the Marijuana Control Board. Last Wednesday night was a strange one for the Legislature. In a joint session of the House and Senate on April 17, the members confirmed most of Gov. Michael J. Dunleavy’s nominees for state boards and commissions and all of his cabinet appointments. Seven appointees were not confirmed, though, with one not being voted on and six being rejected. Although some were rejected based on their resumes, last-minute accusations of sexual harassment against one blew up the confirmation process. Karl Johnstone, one of Dunleavy’s four nominees to the Board of Fisheries, was voted down 24-33 late that night. Earlier in the day, Rep. Ivy Spohnholz, D-Anchorage, surprised the members of the Legislature when she said during her comments that she had received texts from two women alleging sexually harassing behavior from Johnstone during his previous service on the board. The allegations were not mentioned during multiple previous confirmation hearings, when hundreds of people testified for and against Johnstone based on his past service with the board. After Spohnholz’s comments, the Legislature voted narrowly to table Johnstone’s nomination but brought it up again later that night, at which point he was voted down. The allegations were a surprise to many in the room, and Spohnholz did not identify the two people who put them forward, nor were they identified later. No formal investigation was conducted into the allegations, and Johnstone did not have the opportunity to make comments on the record about any allegations. Andy Hall, the president of setnetting group the Kenai Peninsula Fishermen’s Association and a setnet fisherman, wrote public testimony to the Legislature opposing Johnstone’s nomination but said he was surprised by the process of the vote. “It would’ve been cleaner if it was a vote based on the testimony provided to the Legislature about him,” he said. “That last incident may or may not have changed things. I don’t know.” Hall and many others who testified to the Legislature against Johnstone offered anecdotes about intimidating behavior, both toward members of the public and toward Alaska Department of Fish and Game staff. Commercial fishermen opposed Johnstone primarily because of a record of voting for sportfishing interests and his public commentary about the need to prioritize sportfishing and personal use fisheries over commercial fisheries, particularly in Cook Inlet. The United Fishermen of Alaska, which does not usually oppose or endorse Board of Fisheries candidates, made a point to oppose Johnstone’s nomination because of his record. The UFA did not have any connection to the allegations of sexual harassment that arose, wrote Executive Director Frances Leach in an email. “We feel it was unfortunate timing that these allegations came out on the floor right before the vote as Mr. Johnstone was not provided time to respond,” she wrote. However, according to UFA’s tracking, it didn’t change the ultimate outcome. Political organizations regularly keep track of how legislators have said they would vote in a record called a chit sheet, and UFA’s chit sheets made before the joint session showed that Johnstone would have been defeated anyway, Leach added. In a statement to KTVA, Johnstone wrote that, “I believe that legitimate claims should be taken seriously and investigated. But let me be clear, I never made inappropriate sexual comments as stated by Rep. (Spohnholz) … I have thick skin and can take the hits, but it stings to know my four daughters have been hurt by this. My appointment to the Board of Fisheries is no longer at stake. My hope is that the truth comes out because the only thing at stake now is my reputation. All Alaskans should be concerned that the truth comes out. What happened to me can happen to anyone.” The vote left a bad taste in some mouths, even among those who did not vote for Johnstone. Reps. Sarah Vance, R-Homer, and Ben Carpenter, R-Nikiski, issued a joint apology to Johnstone and another appointee, Bob Griffin, for what they said was inappropriate behavior from the Legislature impugning nominees’ characters without giving them a chance to respond. Both Vance and Carpenter hail from the Kenai Peninsula, which is rife with fisheries conflict but home to most of Cook Inlet’s commercial fishermen, who heavily opposed Johnstone’s nomination. Both are members of the House minority. House Speaker Bryce Edgmon, I-Dillingham, and Spohnholz did not return calls for comment. “Neither Rep. Carpenter nor I voted to confirm Mr. Johnstone to the Board of Fish, but our decisions had nothing to do with the unfair accusations levied against him on the floor,” Vance said in a statement. “To wildly throw out such offensive accusations with a clear intent to derail someone’s nomination is a sick political stunt, and I hope Mr. Johnstone and Mr. Griffin will accept our apologies on behalf of the body.” Stiver shot down for Marijuana Board In a cleaner, but narrower, vote, the Legislature also turned down the nomination of Vivian Stiver of Fairbanks to fill a seat on the Marijuana Control Board. Members of the cannabis industry heavily campaigned against her based on her past participation in a campaign to ban commercial marijuana activity in Fairbanks and her lack of background in the industry. She was to replace Brandon Emmett, also of Fairbanks, who had represented industry on the board since its inception in 2015. The Legislature did confirm Dunleavy’s second appointment to the board, Alaska Wildlife Trooper Lt. Christopher Jaime of Soldotna. Stiver was turned down in a 29-30 vote, one shy of what she needed for a majority. Carey Carrigan, the executive director of the Alaska Marijuana Industry Association, said the members of the industry were relieved at the vote and that “common sense prevailed.” “We’re not trying to oppose people to oppose them,” he said. “(For) that second seat that everyone’s considering a public seat, I’d like to see two seats for industry on the board. To have two seats on the board representing industry on the board is not unreasonable.” The industry group has assembled a group of suggested individuals for appointment to submit to Dunleavy’s administration, Carrigan said, aiming for a person with industry background and knowledge, he said. That list, submitted Wednesday, includes Bruce Schulte of Anchorage, Joseph Martin of Anchorage, Rebecca Rein of Houston, Michael White of Anchorage and Gary Evans of Fairbanks. Schulte served on the board from 2015–2016, including as chairman, until former governor Bill Walker dismissed him. “I don’t know if there’s going to be any desire to accept our assistance,” he said. “I hope there is.” Elizabeth Earl can be reached at [email protected]

State hopes to launch industrial hemp program by fall

Though the state legalized a pilot project for industrial hemp agriculture more than a year ago, some hurdles still stand between farmers and authorized grows. Hemp and marijuana both come from the same plant, but the variety that produces hemp is significantly lower in the psychoactive component, THC. Hemp can be used in a variety of products, from textiles to cosmetics to animal feed. One of its most widely known uses is in the dietary and medicinal supplement cannabidiol, or CBD. Former Gov. Bill Walker signed Senate Bill 6 into law in April 2018, authorizing the state to move forward with developing a pilot project for industrial hemp growers. The program is authorized under the 2014 federal farm bill, which essentially allowed states to take the helm on developing these projects if they chose to without fear of federal raids. For the past year, the Alaska Division of Agriculture and the Alaska Department of Law have been working together to hatch both a plan and regulations for that plan to allow farmers to start their own hemp grows. Officials say they hope to get the program rolled out this fall. David Schade, the acting director of the Division of Agriculture, told the House Community and Regional Affairs Committee in a hearing April 18 that the division aims to have a regulation package out for public review by May 15. “Everybody is working really hard to get this along because we’re very well aware of the high level of interest in this project,” he said. “That is a really optimistic timeline but it’s one we’re going to do our best to push forward to meet.” Like marijuana, industrial hemp is complicated to regulate because it has been illegal at the federal level for decades. Unlike marijuana, though, the federal government delisted hemp as a Schedule 1 substance in the 2018 farm bill, defining hemp as “the plant Cannabis sativa L. and any part of such plant, whether growing or not, with a delta-9 tetrahydrocannabinol concentration (THC) of not more than 0.3 percent on a dry weight basis.” The farm bill provided no effective date for the delisting, but based on research, the Drug Enforcement Agency is no longer enforcing Schedule 1 regulations against hemp products, said Joan Wilson, the assistant attorney general with the Department of Law who is working with the Division of Agriculture on the hemp program. A spokesperson for the U.S. Department of Justice confirmed that any parts of the marijuana plant that have that concentration level will be defined as hemp and will not fall under the DEA’s purview. For now, people can’t grow hemp in their backyards the way they can under the state’s recreational cannabis rules. It will still have to be authorized through the pilot program, said Rob Carter, the manager of the state’s Plant Materials Center. As the Division of Agriculture works on the regulations for permits. the Plant Materials Center is working on growing its own cycle of hemp for research and testing purposes at the facility in Palmer. “Without the regulations in place and absent the opportunity to register, producing or marketing industrial hemp … is still illegal,” he said during the House Community and Regional Affairs hearing. “It is to be noted that industrial hemp seeds are much harder to come by than one would expect and at a great cost.” There’s a lot of interest among potential growers, Carter said; he estimated that more than 1,000 people had told him they were interested in growing industrial hemp. Optimistically, they would be able to apply and start growing in indoor facilities in the fall, he said. However, that depends on the state’s ability to get the regulation package approved, which will take about six months if everything goes smoothly, Schade said. There are a number of roadblocks to that. For one, Gov. Michael J. Dunleavy’s proposed fiscal year 2020 budget cuts most of the Division of Agriculture’s existing budget, though neither the Senate nor House proposed budgets include his initial cuts. But one missing item so far is the receipt authority the division estimates it will need to adequately regulate an industrial hemp program. Schade explained that the intent of SB 6 was for the hemp industry to pay its own way, but the division needs the receipt authority from the Legislature for the fees from the industry. Right now, the division estimates the needed authority at $500,000. Rep. Harriet Drummond, who co-chairs the House Community and Regional Affairs Committee, said she would be willing to introduce a bill to grant the division that receipt authority. “Otherwise it sounds like you’d have to come to a screeching halt waiting for receipt authority,” she said. The regulations package also needs to clarify exact laws on hemp, Wilson said. That’s part of what the Department of Law is working on. “Technically we could be requiring registration from any individual who goes to Natural Pantry and buys CBD oil,” she said. “I don’t believe that was (the Legislature’s) intent.” CBD oil has boomed in popularity nationally, including in Alaska. Because industrial hemp is not being grown in Alaska, the oil is being moved across state lines, which is technically a violation of the federal interstate commerce laws. In February 2017, the state Alcohol and Marijuana Control Office raided a number of retailers and seized CBD oil under a 2017 law defining CBD as a marijuana product. The 2018 Farm Bill changed that definition as long as CBD retains a low enough THC concentration, but the U.S. Food and Drug Administration retains authority to regulate it under the Food, Drug and Cosmetic Act. Under that law, introducing into interstate commerce food products to which CBD or THC have been added is illegal. Schade noted that despite its questionably legal status, it’s easy to find CBD products marketed around Alaska. “That creates a lot of angst for those of us who have to regulate this potential industry,” he said. “The issue is under the FDA guidelines this is still illegal for interstate commerce, and yet we see these products out there for both animal and human consumption. We are taking this very seriously.” Several aspiring industrial hemp growers also testified to the committee during the April 18 hearing. Shawn McDonough, who said he purchased several properties on the lower Kenai Peninsula with the express intent to grow hemp. Beyond just the CBD use, he said he’d seen uses for hemp in bioplastics and clothing, though he said he intends to use his grow for CBD extraction. “It seemed like things were moving forward and then we kind of had the rug pulled out from under us and things kind of came to a standstill in recent months in the industry,” he told the committee. “We’d love to see things get back on track.” Elizabeth Earl can be reached at [email protected]

Copper River opener to kick off salmon season in week of May 12

Every spring, Alaska commercial fishermen hold their breaths before taking the plunge of salmon season and the unpredictability of what the runs will bring. The Alaska Department of Fish and Game does its best to forecast what fishermen might expect, but as it’s a prediction, fishermen have to take it with a grain of salt. This year, ADFG is forecasting fairly average sockeye salmon runs, even in Bristol Bay. However, pink salmon and chum runs may help make up for some of the lackluster sockeye runs and still-struggling king salmon runs across the state. Prince William Sound, traditionally the first salmon fishery to hit the markets, is expected to open the week of May 12 in the Copper River and Bering River districts, with the subsequent areas opening in June. The sockeye salmon are the most famous fish from the Copper River fishery, but the kings kick off the season with the annual airplane ceremonies in Anchorage and Seattle for the first king deliveries. The forecast for a return 55,000 Copper River kings is about 20 percent above the recent 10-year average run of 46,000 fish, according to the Prince William Sound 2019 forecast. The forecast for sockeye salmon in the Copper, which is regarded as the most accurate forecast in the region, is about 1.4 million wild fish and 98,000 hatchery fish, about 31 percent and 69 percent below the recent 10-year averages respectively. But ADFG warns caution there as well; last year, the summer brought about 1 million fewer fish than the forecast predicted and there were just a handful of openings for kings. “This forecast is uncertain and should be interpreted with caution as poor runs of many Gulf of Alaska sockeye salmon stocks in 2018 suggest there is considerable likelihood of over-forecasting in 2019,” the forecast states. Pink salmon may be a bright spot as the summer moves along for Prince William Sound, though. ADFG’s forecast projects about 23.5 million wild-run pink salmon to come back, largely based on good escapements in 2015 and 2017. That’s on top of an estimated 22.3 million pinks estimated to return to Prince William Sound Aquaculture Association facilities and an estimated 20.1 million to return to the Valdez Fisheries Development Association’s Solomon Gulch Hatchery. Pink salmon runs have been unreliable in recent seasons, though. The 2018 season was disappointing for salmon fishermen all over the Gulf of Alaska. Pink salmon catches were dismal and sockeye runs were late, if they appeared at all. The 2016 pink salmon season was disastrously poor for Gulf of Alaska fishermen as well, with the federal government appropriating disaster funds to help make up for some of the loss. Fisheries scientists have drawn possible connections between the poor pink salmon returns and persistent warm water conditions in the Gulf of Alaska through 2015 and 2016. Bristol Bay benefited from some of that downturn in sockeye salmon, though. While the rest of the Gulf of Alaska struggled to meet escapement goals and still allow for commercial fishing, Bristol Bay fishermen and processors could barely keep up with record-breaking sockeye salmon runs last year. Things might return to a little more normal this year, though. The 2019 projected total run of 40.18 million would allow for a commercial harvest of about 26.1 million to 27.6 million in Bristol Bay fisheries, according to Fish and Game’s forecast. For comparison, the total run in 2019 would be smaller than just the harvest in 2018; commercial fishermen hauled in 41.3 million sockeye in 2018, with a total estimated run of 62.3 million sockeye to all river systems. The dearth in sockeye elsewhere helped keep prices higher for Bristol Bay fishermen, who caught all those sockeye and were able to sell them for an average ex-vessel price of about $1.26 per pound, according to Fish and Game. “2018 prices were strong, Bristol Bay processors and fishermen were able to move a lot of product at a pretty high price,” said McDowell Group seafood economist Garrett Evridge. “Part of that high price came from weakness in other areas of the state, so that’s a factor. In terms of the 2019 price, the market appears to be pretty stable when you consider the level of inventory. We haven’t heard too many reports of significant existing inventory out there.” Salmon prices fluctuate wildly in-season, with prices typically starting higher early in the season and moving down as more fish hit the market. Before the season begins, processors work on contracts both domestically and internationally, and though ADFG clearly states that salmon forecasts are subject to change, they do affect markets and prices, Evridge said. “The bottom line is these forecasts can be off significantly and sometimes they’re right,” he said. “We should recognize that these are forecasts … Those Fish and Game forecasts are talked about at the highest level of negotiations and they do impact expectations.” Forecasts aren’t the only thing that impact prices. Internationally, farmed salmon production can also affect how consumers demand and purchase fish. Producers like Norway and Chile have not increased production dramatically in the last few years and struggle with pests like sea lice, but other countries are working on expanding their industries. Iceland, for example, has been taking steps to expand its aquaculture industry dramatically over the next decade. Evridge said outlook over the long term is for farmed salmon production to increase as high prices attract investment into aquatic farming. Trade conflicts between the U.S. and China and talk of new tariffs in the European Union on American seafood due to a trade dispute may also affect prices, though nothing is solidified. The issue with forecasting prices is that many factors affect them, and the bottom line is that it’s never a clear projection, Evridge said. “It’s just unknowable,” he said. “But I can say that in recent years we have seen strong prices basically because demand has been strong and demand has been stable. You have the industry that’s marketing and you have ASMI that’s investing significant time and resources into telling the story of Alaska salmon. We generally think that the Alaska name has value to the consumer. Thinking long-term, there are certainly challenges right now with salmon management, but we do have a robust, scientifically managed, sustainably harvested fishery. We are endeavoring to preserve these fisheries in perpetuity.” One bright spot this year may be an exceptionally large run of chum salmon, with a potential harvest of 29 million chums, potentially the largest in the state’s history. Last year brought huge numbers of chum salmon to Norton Sound, and this year may bring a burst of them to Southeast Alaska. Between the region’s hatcheries, an estimated 18 million chum may return. The Northern Southeast Regional Aquaculture Association alone is forecasting almost 9 million chums to return, with just shy of 8 million available for commercial harvest. That may help make up for some of the other disappointing forecasts in Southeast. Pink salmon forecasts are weak, with only 18 million forecasted, and king salmon stocks in the Chilkat, King Salmon and Unuk rivers not even projected to meet their escapement goals. Elizabeth Earl can be reached at [email protected]

Education health care costs a roadblock to budget reductions

As the Legislature battles over cuts in the fiscal year 2020 budget, K-12 education is set to be one of the biggest items of contention. Districts around the state are bracing for major cuts and layoffs, but working around one major cost item largely out of their control: health care benefits. School district representatives have repeatedly identified health care benefits as one of their major cost drivers for increasing significantly each year. High health care costs are a problem for all employers, but for school districts, which depend heavily on state and local funding, the cost is coming under increased scrutiny as Gov. Michael J. Dunleavy proposes cutting more than $300 million from K-12 education and municipalities wrangle with other cost shifts that could reduce their own contributions to their school districts. Health care in Alaska in general is the most expensive in the country, and thus in the world. With a limited market, remote geography and high cost of living, providers in Alaska regularly charge many times more than providers in the Lower 48. Some school districts self-fund their insurance plans, and though public education is one of the largest employers in the state, the insurance pools are still relatively small. It’s a thorny problem for school districts, said Tim Parker, president of the Alaska chapter of the National Education Association. “NEA-Alaska is a steadfast in our resolve to provide the highest quality education to every student in Alaska but health care costs continue to be one of the primary obstacles to creating an educational environment that will allow us to hire and keep the best and brightest educators in the country,” Parker wrote in an email. The cost of health care benefits is pushing down teacher salaries, making Alaska less competitive in attracting teachers to work in the state, said Dr. Dayna DeFeo, the director of the Alaska Center for Education Policy at the University of Alaska Anchorage’s Institute for Social and Economic Research. In a presentation to the House Education Committee, she outlined a number of the reasons education in Alaska costs so much, one of which is health care. “Alaska has a teacher turnover problem,” she said. “It’s like a perfect storm. In the Lower 48 … we have fewer teachers coming from the system. Alaska hires most of its teachers from the Lower 48. The economy in the Lower 48 is booming, so districts are adding positions and offering more competitive salaries. Since we import most of our teachers from the Lower 48, we are competing in a national market.” Salaries for teachers in Alaska, adjusted for the cost of living, are 23 percent less than the national average. However, the cost of benefits are 11 percent greater than the average, the fourth highest in the country, she said. When school districts start with a fixed budget, the increasing cost in one sector means cuts in another part. Other driving factors include energy and the cost of staffing schools in the smallest communities. Districts have been grappling with the cost of health care for a long time. One of the pitched solutions is to create an Alaska Health Care Authority, which would pool together all state, municipal and school district employees into a single state-run health care plan in a bid to increase bargaining power to negotiate with providers for lower costs. In 2017, a feasibility study estimated that a health care authority could save the state about $200 million annually. The Legislature has not yet taken any action to establish an HCA. Rep. Josh Revak, R-Anchorage, told DeFeo during the committee meeting that he would be interested in exploring the option to move all school district employees to the state’s insurance plan, which serves state employees and the Legislature. However, some administrators of current health care pools say this would be a mistake. Rhonda Prowell-Kitter, the executive director of the Public Education Health Trust, said a state HCA would likely be more expensive than anyone anticipated because of the state’s lengthy procurement process and other legal roadblocks, and in the future could be politically swayed depending on the feelings of another governor. “This idea of pooling together for health care services doesn’t really play out,” she said. “You would see Medicaid, Medicare, Tricare being very successful (if they did). They are not sustaining the hospitals. They need commercial payers to come in and sustain them. I would prefer the state look at cost containment strategies, not pooling strategies.” The Public Education Health Trust serves school districts of various sizes in Alaska with eight different plans. Over the course of the 20 years since its founding, the trust has been able to negotiate lower costs for plan members. The average cost of health care went up about 3 percent for members last year, Prowell-Kitter said, while for others it went up 10 percent to 12 percent. That results in savings. She cited examples from Oregon and Washington, where the states have established HCAs. Both states are now debating what to do as the funding has been undershot — Washington by about $900 million. Most of the Public Education Health Trusts’ ability to reduce costs is because of the trust’s ability to move quickly, Prowell-Kitter said. “We’ve pulled together and been able to have great successes in tackling this problem,” she said. “I feel that the tactics and strategies that we’ve implemented over the last four or five year is finally bending the curve.” One major move that has helped reduce costs in the last few years and may shift the tide of health care competition in the state is the introduction of BridgeHealth, a third-party medical company that negotiates discounts for patients in elective non-emergency surgeries to fly elsewhere in the U.S. for surgeries. For Alaskans, that means flying to Seattle and staying in a hotel for a surgery and still saving money compared to having the surgery done in Alaska. Prowell-Kitter said the providers in Alaska were upset at first but now are starting to negotiate as they have to compete with prices three, four or five times lower in Seattle. BridgeHealth Alaska Region Vice President Sarah Brown said the company has been in Alaska since 2007 but significantly taken off in the last five years or so. Nationwide, the company operates in 34 states, with 50 employers and approximately 600,000 employees. The company only contracts with Centers of Excellence and provides transparent costs to members and patients, which help them foresee costs. “To encourage competition and we make it easy,” she said. “The plan sponsor doesn’t have to negotiate with the facilities themselves. We do it for them … We try to make it seamless and easy for the three individuals involved in our transactions.” Prowell-Kitter said the program saved her members $1 million alone last year. While that money is being spent out of state with other providers, it saves the cost of health care premiums going up the following year. Fred Brown, the executive director of the Pacific Health Coalition, agreed that a state HCA would likely not pan out with cost savings. In Oregon, school districts have wanted to opt out of the Oregon Health Authority but have not been allowed to, leaving them with a disadvantage to compete for teachers as that plan becomes more expensive, he said. “If you know (the Alaska state government’s) procurement process at all, it’s cumbersome,” he said. “Nimbleness is a good term describing the ability of those who are parts of smaller plans not to be bound by the restrictions that exist in the state’s procurement process but being able to seize opportunities almost immediately as they present themselves and be able to obtain substantial savings.” The Pacific Health Coalition has had a similar experience with BridgeHealth, using the program starting in 2012 and saving significantly on non-emergency surgeries for its approximately 110,000 Alaska members, which includes members beyond just public education. Greg Loudon, who consults for Pacific Health Coalition in Anchorage, cited a recent example of a negotiation the coalition made with an orthopedic surgery practice in Anchorage to reduce charges for members of the coalition’s health plans. “We’ve used BridgeHealth as almost a tool with a very sharp edge to negotiate with the local providers,” he said. “I don’t think it’s a coincidence that we were able to negotiate a good deal with the local orthopedic surgeons.” Fred Brown, Loudon and Prowell-Kitter all cited some existing problems in Alaska driving up health care costs — the 80th percentile rule and a perceived lack of competition among them. However, all three also said they’ve been seeing some changes in the provider market due to efforts like BridgeHealth and their collective bargaining power. School districts have begun some of their own efforts as well: the Anchorage School District opened its own health clinic in 2017; the Fairbanks North Star Borough and school district employees are pooled together in a health trust; and the Kenai Peninsula Borough School District began offering BridgeHealth services to its employees in 2018. “We’re the innovators,” Prowell-Kitter said. “Don’t interfere with what’s working.” Elizabeth Earl can be reached at [email protected]

Council committee struggles with federal Cook Inlet salmon plan

Two-and-a-half years after a federal court directed the North Pacific Fishery Management Council to develop a fishery management plan for the Cook Inlet salmon fishery, there is still a lot of work to do. The commercial salmon fisheries of Alaska are primarily managed by the state, including in Cook Inlet, where part of the fishery takes place in federal waters. The North Pacific Fishery Management Council for years deferred management of the salmon fishery there to the Alaska Department of Fish and Game, finally removing Cook Inlet completely from its FMP in 2012. The United Cook Inlet Drift Association and the Cook Inlet Fishermen’s Fund sued, saying the federal government had a responsibility to manage that fishery to ensure it complies with the Magnuson-Stevens Act. In 2016, the 9th Circuit Court of Appeals agreed, and the council reluctantly turned back to developing a management plan. Many of the commercial fishermen there have a longstanding dissatisfaction with the Alaska Fish and Game and the Board of Fisheries, stemming from a belief that the department’s allocation decisions governed by the board are politically rather than scientifically motivated and that the escapement goals for sockeye salmon on the Kenai River are too high. They sought to exercise federal influence over state management through the lawsuit, and now are running into roadblocks on federal authority to do so. The Cook Inlet Salmon Committee, which the council convened to gather stakeholder feedback on developing the FMP, has been hung up on philosophical differences at meetings. Council staff Jim Armstrong, who serves as the plan coordinator for the Cook Inlet salmon FMP, told the council during its meeting on April 7 that there are still some major points of disagreement between the stakeholder council members, the council’s Scientific and Statistical Committee and the council staff. “There’s a lot of frustration and they have perspectives on the way that these salmon fisheries should be managed and how escapement goals are set and the biological impacts of spawning stock reaching the carrying capacity, and they feel it has,” he said. “That’s the theme that has woven through my report and experience of these meetings. We’re not just going in there with an agenda and checking boxes. They’ve come in with a certain plan and we’re trying to reconcile that with what’s possible under the federal system and the council process. It’s taking some time.” One of the core tenets of the fishermen’s grievances is the belief that ADFG’s sockeye salmon escapement goals on the Kenai are too large, exceeding the carrying capacity of the system and thus reducing the overall return of fish as well as commercial harvests and therefore not delivering the required maximum sustainable yield. The committee requested a scientific analysis of how different stock-recruitment models fit the Kenai River and at what level the river could be considered overcompensated — essentially, how many sockeye salmon it would take for the stock to begin crashing rather than producing more fish. Dr. Curry Cunningham of the Fisheries, Aquatic Science and Technology Laboratory at Alaska Pacific University developed the analysis. The Kenai River is the largest sockeye salmon-producing system in Cook Inlet, replete with large lakes and gravel bottoms for sockeye spawning and rearing. Cunningham’s results concluded that an escapement of between 1.03 and 1.78 million sockeye would achieve a maximum sustainable yield of 2.97 million to 3.55 million sockeye on the Kenai River. After looking at multiple models, he found that the model that best fit the data from the river — called a Beverton-Holt relationship — offered limited support for overcompensation in the river. “Given that a Beverton-Holt function does not provide for overcompensation, this indicates limited evidence for the overcompensation hypothesis with respect to the Kenai River late-run sockeye salmon stock,” he wrote. This is not necessarily the same case for the Kasilof River, a separate but nearby stock. Upper Cook Inlet fishermen harvest both stocks of sockeye, and while the Kasilof River produces fewer sockeye, it is important to the commercial fishery and sustains a sportfishery of its own. Fitting a model to the data on the Kasilof, Cunningham wrote that the model does not confirm that the Kasilof is overcompensating, but that it can’t be rejected. His results suggested a maximum sustained yield of 629,000 sockeye for an escapement of 235,000 on the Kasilof. Cunningham’s findings about the Kenai River generally agree with ADFG’s calculations about escapement on the river. In a memo released March 26 detailing proposed escapement goal changes for Upper Cook Inlet, department staff indicated that results based on the traditional Ricker model indicate that the current escapement goal is too low and recommended raising the goal by 50,000 sockeye on the lower end and by 1 million on the upper end. Fish and Game noted that the data the department has doesn’t conclude anything about overcompensation but noted that escapements after 1979 are more consistent than those between 1968 and 1978, and so excluded the earlier years in model estimations. Using data from years 1979 to 2012, a goal that would produce 90 percent of maximum sustainable yield would be between 774,000 and 1.7 million sockeye, according to the escapement goal memo. The committee members have repeatedly said they wanted the federal government to influence the state’s escapement goal development, Armstrong said. “This was framed as a fundamental question, as in if this can’t happen, what’s the point of this whole exercise?” he said. “That’s not a committee statement, that’s just a flavor (of the discussion).” The state has jurisdiction over inland waters and out to three nautical miles from shore. The court decision doesn’t give the federal fisheries managers rights to manage inside the state waters, nor does it allow them to overrule state management of fish in those waters. That is another fundamental disagreement between the stakeholders and the council, Armstrong said; some members of the committee believe the federal government should extend its management into the freshwater salmon habitat. Some council members expressed frustration at the delay in the work so far. Council member Bill Tweit of Washington noted in his comments that the council has specific rules under federal law. “I think the more time the committee spends debating those kinds of issues, the longer this process is going to take and the longer it’s going to take to actually develop an FMP,” he said. “If the committee members want a salmon FMP, they’d be well advised to play within the boundaries of the ballfield that is the Magnuson-Stevens Act. None of us get to play outside those boundaries.” Committee member Hannah Heimbuch, who commercially fishes in Cook Inlet, told the council that there is still significant confusion among stakeholders about the council process, as the state management process is more familiar to them. “Some are fairly hopeless and think federal management is the only way to manage the fishery,” Heimbuch said. “Some are understandably frustrated that we even went down this road. And some are very confused … That all with a 40-year low harvest (of salmon in 2018). I think understandably there is a lot of emotion and tension. For me that meant selling my boat last week and leasing this year. “To the extent that the council would be able to do any community outreach that communicates that beyond the scope of the committee, I think that would be helpful.” Elizabeth Earl can be reached at [email protected]

Battle brews over return of Johnstone to Board of Fisheries

Unsurprisingly, there is likely to be a tense vote in the Legislature over at least one of Gov. Michael J. Dunleavy’s appointments to the Board of Fisheries. A pair of resignations from the board added with the end of member terms give Dunleavy a chance to select a majority of the board’s seven seats with four up for confirmation. One — Marit Carlson-Van Dort of Juneau — drew some raised eyebrows because of past work with the Pebble Limited Partnership, and another — Karl Johnstone of Anchorage — sparked a fiery opposition from commercial fishermen and vocal support from sportfishermen. The other two, Israel Payton of Wasilla and Gerad Godfrey of Kodiak, drew little to no controversy. The members of the Board of Fisheries serve three-year terms and determine fishing allocation and opportunity in the state. The appointments are always controversial, with the governor selecting candidates and the Legislature interviewing them intensively before either confirming or rejecting them. While there are no dedicated seats on the board for either region or user group, stakeholders keep track of where members’ experience and interests lie and calculate the balance of the perspectives. This time, the commercial sector loudly objected to the governor’s appointments, saying the balance would heavily tip toward sportfishery interests. Bob Penney of Kenai, who has spent decades fighting for sport priority over commercial in Cook Inlet, was a major financial supporter of Dunleavy during the 2018 election. Johnstone, a retired Superior Court judge and a friend of Penney’s since the 1970s, was the main flashpoint of the group of appointments. Following seven years of serving on the board, he resigned in 2015 after then-Gov. Bill Walker told him he would not be reappointed after former House Speaker Mike Chenault, R-Nikiski, objected to how Johnstone handled the board’s interview process for candidates for commissioner of the Alaska Department of Fish and Game. Johnstone told the Senate Resources Committee in a hearing on April 10 that he was interested in taking up Board of Fisheries service again because he’s been keeping up with fisheries issues and he finds the work rewarding. “There’s an enormous amount of work involved if you do it right, and an enormous amount of time spent … I choose to consider the rewarding part of it, and that’s why I reapplied,” he told the committee. “I have the time and the energy and the desire to continue this work.” Johnstone comes with a heavy wake of controversy. During past service, records from the Alaska Department of Fish and Game showed that the department spent more money on lodging for Johnstone than any other member during board meetings in Anchorage, despite that Johnstone has a home in Anchorage. He maintains a home in Prescott, Ariz., and frequently travels out of state, though he told the Senate Resources Committee that he spends “much more time in Anchorage than I do elsewhere.” In 2000, he was publicly reprimanded by the Alaska Commission on Judicial Conduct for violating the legal parameters of hiring a coroner and was once recommended for nonretention by the Alaska Judicial Council in 1988 for being unqualified, ranking low in integrity, judicial temperament and overall performance. Within the fisheries world, he’s a polarizing character. Sportfishing advocates testified to the committee that he maintained a professional demeanor and always came prepared to meetings, running them fairly for the four years when he served as the chairman. On the other end of the spectrum, commercial fishermen ardently oppose his nomination because they say he is irreversibly biased in favor of the sportfishing industry and say that he created a hostile atmosphere at board meetings. A joint House Fisheries and Resources committee meeting April 15 attracted more than 100 commenters and ran for nearly four hours, with testifiers on both sides. The Senate Resources Committee meeting on April 10 similarly attracted a large number of testifiers on both sides, though the majority opposed Johnstone. The United Fishermen of Alaska, an organization representing 37 commercial fishing groups in the state, doesn’t usually endorse or oppose Board of Fisheries candidates because of the potential for repercussions if the person they opposed is confirmed anyway. In written comments to the committee, UFA noted it hadn’t opposed a board member nominee since 2006. Executive Director Frances Leach told the Senate Resources Committee that Johnstone’s record shows that he is aware of fisheries regulation processes through the board but has disregarded them. “We understand the risk that we are taking in opposing someone such as Mr. Johnstone because we understand there are repercussions that could cause us harm,” she said. “His blatant bias against commercial fishermen was illustrated heavily throughout meetings.” Commercial set gillnet fishermen on Cook Inlet’s east side have a particular axe to grind with him. As chairman, he oversaw an Upper Cook Inlet meeting in 2014 in which a board-generated proposal was introduced to set significant restrictions on setnetters paired to restrictions on the Kenai River king salmon sportfishery, which commercial fishermen saw as a violation of the public process because the proposal was introduced, deliberated and passed without public input during committees or public comment. A number of Kenai Peninsula setnetters testified against his reappointment to the board, with a number saying he used his position to belittle Alaska Department of Fish and Game scientists and members of the public. “My experienced with Judge Johnstone has been anything but fair and balanced,” said Ken Coleman, a Kenai-area setnetter. Though he’s been absent from the Board of Fisheries since 2015, Johnstone occasionally wrote in opinion pieces to Alaska newspapers focusing on fisheries. Some highlighted a belief that personal-use and sportfisheries needed to take precedence over commercial fisheries and referring to commercial fishing in the state as “the aged and fading sibling.” Sportfishing supporters wrote in and testified in support of all the candidates Dunleavy appointment, but particularly for Johnstone. The Kenai River Sportfishing Association hosted a letter-generating form on its website, producing a large volume of form letters from individuals, and other organizations noted that the Legislature awarded Johnstone a citation for his service on the Board of Fisheries in 2015. “We much appreciate that Chairman Johnstone prioritized managing for the sustainability of our fisheries resource first and foremost as well as his efforts to provide reasonable harvest opportunities for all user groups, particularly Alaska residents, most of whom do not own commercial fishing permits,” wrote Martin Meigs, the chairman of the Alaska Sport Fishing Association, in his public comment to the House Fisheries Committee. “People as experienced if (sic) fisheries and as dedicated and competent as Karl Johnstone are few and far between!” During the hearings, a number of legislators showed skepticism about Johnstone, in part because of concerns about how much time he spends in Alaska. Sen. Scott Kawasaki, D-Fairbanks, asked if Johnstone would release his 2019 Permanent Fund Dividend application — which details how many days a person spends out of state as a qualifier to receive the dividend — as a way of quelling public debate about whether he primarily lives in Alaska or Arizona. Johnstone, who said he was calling into the hearing from Arizona, said he did not have an objection but wondered “why you want it.” Applicants for the PFD who are gone from the state for more than 90 days must document their absences and must reside in the state for at least 185 days per year. According to Permanent Fund Dividend Division records, Johnstone did not apply for the PFD from 2002 to 2009, did apply for it while on the board from 2010 to 2015 and did not apply for it in 2016 and 2017 before applying for it once again in 2018. “By all standards, I’m a resident,” he said. “I do spend time outside Alaska. My interest in the winter at my age has waned a little bit, although I still enjoy it once in a while. I do travel quite a bit. I also travel to other states and countries in the winter … From every point of view I can think of, I’m a resident.” Rep. Louise Stutes, R-Kodiak, who chairs the House Fisheries Committee, passed the gavel at the end of the April 15 meeting to explain why she would vote against Johnstone in the joint House and Senate confirmation hearing. Saying she was “morally and ethically compelled” to oppose him, she added that she understood the governor would not appoint a commercial fishing representative to the seat but wanted to at least see an appointment from outside the Anchorage area. “I firmly believe that Mr. Johnstone’s reputation and history of biases show that he is not the right person for this board,” she said. A few commenters said they opposed Carlson-Van Dort because of her work with Pebble, though others supported her because of her background in environmental science and familiar with fisheries. Payton, who currently serves on the board, attracted a number of supportive comments from both sport and commercial interests. The committees forwarded the names to a joint hearing for consideration. ^ Elizabeth Earl can be reached at [email protected]

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