BROWN'S CLOSE: Birthday Battle Royale

Back at a time in the distant past of October 2019, my friend’s son turned eight. He and I share a special bond; I once spent an afternoon helping him fold paper airplanes. At his instruction, I then threw said airplanes at him; he wanted to practice his ducking skills. We’ve been friends ever since. During that time, the citizens of Anchorage could mark such an occasion with a celebration. Thus, my friend threw him a “Harry Potter” themed birthday party, held at The Dome; she magnanimously offered me my pick of activities. I could make pizza, make butterbeer, make a pinata, make a cake, or referee Quidditch. Refereeing was most in line with my life goal of bullying humanity. I volunteered for this, under the condition that I could use a loud, high-pitched whistle. On the day of the party, I set out for The Dome for the first time in the history of my Anchorage residency. I drove around the neighborhood three times looking for the entrance, consistently getting pulled into that vortex known as the Changepoint parking lot. Once inside, it was obvious which section of The Dome was designated for the Harry Potter party. One of the soccer fields was cordoned off, with three Quidditch goal rings erected on either side. I walked over to my friend, easily spotted as a tall thin woman dressed as the Golden Snitch in a glittery jacket. “Can you round up the kids and start Quidditch?” she squawked by way of, “Hello.” “They need to burn off some energy,” she continued. “I’ve got a dad refereeing with you.” I bristled at relinquishing any portion of my power, and grumpily walked flat-footed over to The Dad. He smiled at me bemusedly. “Uh, you know the rules?” “Nope,” he grinned. “No idea!” My mood lifted. Now I had an adult to push around, in addition to thirty children. We strolled to the middle of the Quidditch pitch, where I picked up a white volleyball, and blew my whistle. Children looked up from wrestling matches, punching matches, and other rudely energetic forms of aggression. “Anyone who wants to play Quidditch, come to the middle of the field NOW!” I barked. Twenty-nine small people scampered to my side. “I need you to break into two teams!” Instead, everyone went back to wrestling a neighbor. I blew my whistle again. “Hey! Two teams! NOW! Let’s go!” A handful of obliging children splintered off into a second team. Everyone else stayed put, looking at me expectantly. “Uh, the teams need to be even. We need more of you to move.” All 29 children ran over to one side. The Dad walked over. “I think we should just count off, ‘One, two, one, two,’” he offered knowledgeably. I bowed to his wisdom; reasoning with children is a perpetual struggle for me. We counted off, and yet two-thirds of the kids were still magically on one team. I pointed. “You five over here. The rest of you, stay put!” Birthday Boy sidled up to me. “Can my mom play?” “No kiddo, she’s doing other things.” Birthday Boy’s lip quivered. “Can Zed be on my team?” No, we’ve only just got the teams even. “No, Zed has to stay where he is.” Birthday Boy looked completely crushed. “Can we be Gryffindor?” A blond boy with large eyeglasses blinked at me. “Uh, sure,” I agreed distractedly. “Wait, we want to be Gryffindor!” a tall gangly boy cried out, asserting his side’s rights. “Sure, you can be Gryffindor too.” I blew my whistle. “Alright, listen up! I need you to pick one person to be the Beater per side.” In Harry Potter, the Beaters have the enviable power of throwing balls at their fellow players. And, as in the books, this position proved popular amongst my 29 charges. Two boys from one team both declared themselves Beaters. “Uh, you’ll be a Beater first, and then you’ll switch,” I pronounced. Again, I made the mistake of ascribing utter reasonableness to school children. Beater No. Two turned an impressive shade of crimson in an even more impressively short period of time. “BUT I WANT TO BE A BEATER!” He threw himself onto the ground and began to pull out his hair. I looked at him, nonplussed. Even I had to admit, I was unequipped to deal with this total meltdown. I chose to ignore him, and turned away to blow my beloved whistle. “The rest of you, throw this volleyball through one of the rings on the other side. If a Beater hits you with one of their red balls, drop the volleyball and run back to your team’s rings. “On my whistle. One, two –” I blew the whistle and tossed the volleyball directly above my head. The outcome of the match was immediately certain. The big gangly kid scored twice in under a minute. Both sides’ Beaters watched their fellow teammates running joyfully around the field. Seemingly regretting their positions, each started tossing their red balls through the rings. “Goal! Goal!” they screamed helpfully. “No goal! No goal!” I waved my arms around maniacally. “Beaters, you have to throw your red balls at the other team!” Both Beaters ignored me, and continued to throw their balls through the rings, and not violently at their fellow players as J.K. Rowling intended. Gangly Kid scored four more times. My friend, the glittery Golden Snitch appeared, holding the hand of a very tiny girl dressed as Tinkerbell. “We have another player. Can she join the melee?” I puffed my chest out authoritatively and waved my hand dismissively. I had more important things to concern myself with than some small child dressed as a character from the wrong story. My friend directed Tinkerbell to join the game. Alas, she appeared to have very little actual interest in playing. Instead, Tinkerbell sauntered off and began hitting a punching bag. The volleyball fell to the ground, and was snatched up by Big Eyeglasses, who was promptly tackled by four other players. I contemplated breaking up the fight, but decided against it. It was high time these children learned the law of natural consequences. Gangly Kid yanked the ball away and scored three more times. I waved to my friend. As the Golden Snitch, she was the most desirable object in Quidditch; per standard rules, the first team to catch her won 150 points. I decided to simplify the scoring; I did not want to do complex addition. “We have now come to the final portion of the game!” I bellowed, blowing my whistle. “I need everyone to line up over here to my left. “This,” I gestured to my friend, who was now wiggling to and froe at the other end of the field, “is the Golden Snitch. The first player to tag her wins his team 10 points.” “She’s worth 150 points!” Birthday Boy corrected. Outsmarted again. “On my whistle. One, two—” On the whistle, 30 children ran forward. The Snitch was tagged by Gangly Kid within seconds. I trotted over to him. “You! Kid! Yeah, you kid! Which team were you on?” He looked momentarily confused. “Uh, that team!” he decided. “The team going that way!” He pointed. I blew my whistle. “The team going that way wins!” One of the moms walked up to me. “Wow, you really had those kids in line. You really made them hop-to!” My chest swelled with pride; kinder words were never said to me. “It’s all in the whistle,” I mumbled humbly. “All in the whistle.” Sarah Brown is training to be a world-class drill sergeant. In the meantime, she can be reached at [email protected], and on Twitter @BrownsClose1. “Close” is a British term for alley or cul-de-sac. For more of Sarah’s musings, visit

‘We’re not Amazon’: COVID-19 is forcing small stores to try online retail

CHICAGO — Two years ago, Esther Fishman shut down her clothing and gifts shop’s online store. Art Effect’s bricks-and-mortar business, operating in Chicago’s Lincoln Park area, was strong, and selling online seemed like more trouble than it was worth. It seemed like the right call until this spring. When the coronavirus pandemic forced all but essential retail stores to close, Art Effect rushed to get its online store back in business. Fishman has since hired a company to build a new, easier-to-use site. Small neighborhood retailers used to compete with Amazon by catering to local shoppers who enjoy browsing in person. That’s still true, but in the six months since the pandemic began, a growing number are venturing onto Amazon’s turf. Most say online sales are a long way from making up for sluggish in-store sales, and some struggled to shift businesses built for in-person shoppers online. Others say it’s a service they can no longer afford to avoid, especially if a surge in cases forces stores to shut down again. “The old world doesn’t exist anymore. … We’re training people now how easy it is to shop online. There are people who are not comfortable with that, but there are a lot of people with busy lives finding out it’s a good alternative,” Fishman said. “I think it’s only going to grow.” Online shopping has boomed during the pandemic: Estimated U.S. e-commerce sales in the second quarter rose 44.5 percent compared with the same period last year, while overall retail sales fell 3.6 percent, according to the U.S. Census Bureau. Analysts say consumers are likely to shift some spending back to stores as concerns about shopping in person and capacity limits on stores ease. “It’s a mistake to assume everyone getting online is happy about it,” said Brendan Witcher, e-commerce analyst at Forrester Research. Still, the pandemic showed that even small shops can’t afford to ignore online retail, said Diana Smith, associate director at market research firm Mintel. Big chains like Target and Best Buy reported triple-digit growth in online sales during the second quarter. Target reported especially fast growth in services that let shoppers get online orders the same day they’re placed, including a 700 percent increase in drive-up orders, where shoppers can have purchases delivered to their car, and a 350 percent increase in same-day home delivery orders with Shipt. Other major retailers that let customers shop online but lacked curbside pickup rushed to roll it out, including Ulta, Gap and Paper Source. So have several malls, including Hawthorn Mall and Fox Valley Mall in the Chicago suburbs of Vernon Hills and Aurora. This fall, customers will be able to shop any mall store from the shopping centers’ websites, said mall owner Centennial. Meanwhile, ShopRunner, a Chicago-based service that gives members free two-day delivery when shopping at stores in its network, has added more retailers this year than any year since 2015 and plans to introduce same-day delivery at certain retailers in Chicago this month, said CEO Sam Yagan. Smaller retailers that traditionally relied on bricks-and-mortar sales, meanwhile, were left scrambling. “They’re going to be struggling the most because they’re the most behind and have the most challenges to get up and running and catch up with everybody else,” Smith said. At Milk Handmade, which sells locally made women’s apparel and accessories in Chicago’s Uptown neighborhood, owner Hallie Borden spent the early days of the pandemic “panic-adding” items to the online version of her store. Before the pandemic, only about 10 percent of its merchandise was listed. The online store brought in business from out-of-town customers who would likely never have visited in person, and web sales now account for about half of Milk Handmade’s business, Borden said. Still, “we’re not Amazon,” she said. Borden packs up all online orders on days the shop is closed, something that worries her headed into the holiday season. Shoppers concerned about crowds or whether local shops will struggle to get last-minute orders delivered on time might decide it’s easier to stick with Amazon. “It’s frustrating big-box stores can get products to customers really fast and I can’t. We’re just trying to prepare customers and set expectations for how long something might take to arrive,” she said. Some local business groups have launched directories to promote businesses’ low-contact shopping options. In west suburban La Grange, the website La Grange Delivers lets specialty retailers outline ways to place orders for curbside pickup or delivery and has lists of restaurants offering outdoor seating, pickup or delivery. “A lot had an online presence, but it wasn’t a priority for them,” said Nancy Cummings, executive director of the La Grange Business Association. “That’s completely shifted.” Still, some stores are easier to recreate online than others. Bras Galore, a shop selling bras, intimate apparel and swimwear, has always emphasized the importance of getting an expert fit, said owner Kathy Bonifas. Even selling to existing customers who had previously been fitted would have been hard, because many gained or lost weight during the pandemic and were no longer sure what size they needed. “That’s always been our adage: Don’t buy online or you’ll buy the wrong size,” she said. Being limited to bricks-and-mortar sales makes the city’s 25 percent capacity limit especially challenging, she said. “How are you supposed to be at 25 percent of your sales and 100 percent of your rent, and no one is helping you out financially?” AlleyCat Comics, in the Andersonville neighborhood, built an online store but most customers avoiding shopping in person still seem to prefer calling the store and having an employee serve as a personal shopper, said Selene Idell, who owns the shop with her husband, Nicholas. People rarely come in search of a specific title, which makes buying online tougher, she said. “They want to browse and look at the pictures and see if they like the art. Comic book shoppers are particular about the book’s condition. It’s a very hands-on kind of business,” she said. AlleyCat plans to hold online-only sales during the holidays to encourage shoppers to check out the online store. “I think it’s beneficial for us for running the business, but it’s not making any money right now,” she said. Selling online is also extra work, especially for stores with inventory that changes frequently. “It’s a tricky balance. It takes time to take photos, edit them, write the copy, and put it online,” said Merl Kinzie, who owns The Shudio, a shop selling plants, vintage apparel and gifts in the Pilsen neighborhood. A big chain that will sell dozens, if not hundreds, of a particular shirt only needs to put that effort in once. Vintage or resale clothing is usually one of a kind. The Shudio had an online store before the pandemic but it wasn’t a priority because customers drawn to its focus on sustainability seemed to prefer shopping in person. Lincoln Park-area kids’ resale shop The Second Child is more optimistic about online sales even though it has the same challenges with one-of-a-kind merchandise. Before the pandemic, The Second Child only sold its highest-end pieces — about 3 percent of the roughly 5,000 items in its bricks-and-mortar store — online. Now, owner Amy Helgren estimates shoppers can find 90 percent online. Even before the pandemic, Helgren worried about competition from Amazon, a one-stop shop that lets busy parents buy whenever they have time, even if that’s the middle of the night, when her bricks-and-mortar store is closed. “The first thing I do now when I wake up is check my phone for online orders,” Helgren said. “It has to be at their convenience. They want what they need, and they want it now,” she said. Richard Forsythe, who owns Lincoln Square pet supply shop Ruff Haus Pets, said online sales have been growing since it launched an online store about a month into the pandemic, though the bricks-and-mortar store still generates most of the business. He just hopes the online growth doesn’t come at the expense of sales at the store, which moved to a larger location last fall. When people come to the shop, they might pick up an extra treat or toy for their pet. “When you’re online, it’s ‘What do I need?’” he said. Jewelry and accessories boutique Embellish saw online sales slow once the shop reopened to customers, said owner Carrie Bowers. She still thinks the days of getting up at 6 a.m. and working until 1 a.m. to get the online store in business were worth it. “We’ve had a lot of new customers, and I think that’s being able to see what we’re about before you walk in,” she said. “And who knows if we’ll have to close down again? It’s something we have to have.”

Google’s search business targeted in looming US antitrust case

Google’s search engine, one of the most-profitable businesses in history, is about to face its biggest challenge as the U.S. government readies an antitrust lawsuit accusing the company of crushing competition to protect and extend its monopoly. After a 14-month investigation, the Justice Department is homing in on whether Google skews search results to favor its own products and whether it uses an iron fist over access to users to shut out rivals, according to people familiar with the matter. Google, which controls about 90 percent of the online search market in the U.S., has long been a target of rivals that complain it’s used that power to snuff out competition across the internet. What started out as a college research project in the late 1990s now generates about $100 billion in highly-profitable revenue each year. The search engine decides the fates of thousands of businesses online and has funded Google’s expansion into email, online video, smartphone software, maps, cloud computing, autonomous vehicles and other forms of digital ads. European competition regulators have fined Google billions of euros for breaking antitrust laws. But U.S. enforcers have left the company mostly untouched since the Federal Trade Commission closed a probe in early 2013 with no action. Now, Attorney General William Barr is on the cusp of what could be the biggest U.S. monopoly case since Microsoft Corp. was sued by the government more than two decades ago. Barr has been a key ally in Donald Trump’s crackdown on technology giants. The U.S. president has railed against internet companies for allegedly censoring conservative viewpoints online. While some involved in the Google case expected it to be filed as soon as next week, that timing will likely be pushed back, possibly to the following week, according to two people familiar with the matter. State attorneys general and Justice Department lawyers have been discussing final preparations for the case this week in Washington. The people asked not to be identified discussing private matters. Senior Justice Department officials met with Google representatives this week to discuss two prongs of the investigation: search bias and search distribution, according to one of the people. Search bias is the allegation that Google skews results to favor its own properties, such as a shopping service, travel bookings and local business listings. Search distribution centers on agreements with device makers and other partners to provide Google search as a default to users. In 2018, Goldman Sachs estimated Google paid Apple Inc. $9 billion to get its search engine on Apple’s Safari web browser and other prime spots on Apple devices. It’s impossible for small search engine competitors to compete with Google’s deep pockets and outbid it for valuable placements like Apple’s browser, according to Gabriel Weinberg, CEO of DuckDuckGo, a privacy-focused search provider that has complained to the DOJ about Google. During a recent congressional hearing, Google executive Don Harrison argued that the company doesn’t dominate the markets it operates in. Google may lead when it comes to general searches, but for product queries and other commercial searches consumers are more likely to start on Inc., he noted. The Justice Department and states also are investigating Google’s conduct in the advertising-technology market, where Google owns many of the systems that deliver display ads across the web. Some Democratic attorneys general briefed on the case want the Justice Department to include ad-tech in the lawsuit and may file their own complaint after the November election, one of the people said. The Justice Department declined to comment. Competitors have complained that Google funnels excess search marketing dollars to its display ad network. That extra money can account for large portions of digital publisher revenue, making them less likely to drop Google for a rival ad-tech provider. U.S. investigators have asked detailed questions about how to limit Google’s power in the search market, according to DuckDuckGo. In Europe, regulators have forced Google to give consumers a choice over which search engine they use on Android phones. “We’re pleased it seems like the DOJ — unlike any other government in the world — is going to finally address the elephant in the room: Google’s obvious, overwhelming, and anti-competitive dominance in search,” a spokesman for DuckDuckGo said. “Consumers would benefit from a world without search defaults, where they could easily choose their preferred search engine.” Google has engaged in an array of practices aimed at maintaining its control over the search market and preventing competitors from gaining scale, said Gene Kimmelman, a senior advisor at Public Knowledge, which urged the Justice Department this summer to investigate Google’s conduct around search. Consumers have lost out as a result because rivals are effectively shut out from competing to build better search offerings, he said. “Search is the fundamental motivator for the pattern of behavior by Google, and all of it appears designed to maintain a monopoly,” Kimmelman said. A research paper published in June by the Omidyar Network, an organization that advocates for more aggressive antitrust enforcement against tech giants, outlined several scenarios where Google may have violated antitrust laws. The exclusive deal with Apple has helped solidify its monopoly by preventing competitors from reaching consumers, the paper argued. Google created a similar effect with its Android mobile operating system and agreements that effectively forced handset makers to pre-install Google’s search engine and browser on their phones. Those restrictions made Google the default search service and further prevented rivals from gaining market share, according to the Omidyar paper. The EU also fined Google over this. “This is a classic tale of a likely monopolization strategy premised on denying scale to rivals,” the paper said. The allegations echo those made against Microsoft in 1998 when the Justice Department and a group of states sued the software maker for antitrust violations. Back then, Microsoft forced computer manufacturers to bundle its Windows operating system with its Internet Explorer browser, making it harder for rivals such as Netscape to compete. Even though other browsers didn’t pose a direct threat to Microsoft’s monopoly in computer operating systems, the risk was that they could one day grow to challenge its dominance. The Justice Department could make a similar argument about Google today, said William Kovacic, a law professor at George Washington University and a former FTC chairman. “The arguments about demanding exclusivity as a way of excluding rivals are arguments that were very successful in the Microsoft case,” he said.

Movers and Shakers for Oct. 4

Taylored Restoration has hired Tyler Kirn as project manager. Kirn graduated from the University of Alaska-Anchorage with a bachelor’s degree in global logistics and supply chain management. The University of Alaska-Anchorage announced its 2020 Alumni of Distinction recipients to be honored at UAA’s virtual Homecoming Breakfast on Oct. 9. Dr. Reem Sheikh (bachelor’s degree, biological sciences, 2007) was named Alumni Emerging Leader. Sheikh is a clinical instructor and attending faculty at the New York College of Podiatric Medicine. As a podiatrist working in New York City, Sheikh witnessed firsthand how the shortage of personal protective equipment affected health care workers in the early days of the COVID-19 pandemic. After assembling volunteers that she met through parenting Facebook groups, Sheikh raised more than $18,000 to alleviate PPE shortages for New York City health care workers, and coordinated the donation of thousands of PPE across the country. Dr. Ghazal Ringler (bachelor’s degree, biological sciences, 2001) was named Alumni Humanitarian. Ringler is the chief dental officer at the Anchorage Neighborhood Health Center. For more than 16 years, Ringler has dedicated her career to providing dental care to children and adults who are uninsured or low-income. In addition to her position as chief dental officer at the Anchorage Neighborhood Health Center, Ringler donates her time and expertise by serving on the Anchorage Project Access board of directors, where she was critical in establishing the donated dental program and pro bono oral health program. Laurie Fagnani (bachelor’s degree, journalism and public communications, 1986) was named the Alumni of Achievement. Fagnani, president of MSI Communications, grew MSI Communications from a home business started in 1995 with herself as the sole employee to the go-to marketing agency for Alaska’s resource industry. Fagnani attributes her agency’s success to staff with an intuitive understanding of Alaska’s industries, a quarter of whom come from UAA. Additionally, Fagnani has grown her business’ digital services capacity to better aid clientele as they also adapt to an increasingly web-dependent business model. Leverette Hoover (bachelor’s degree, technology, 1997) was named the Alumni of Achievement. Hoover, national operations manager for Siemens, pursued a civilian career in electronics and engineering after serving for eight years in the U.S. Air Force, consisting of various positions with Siemens over the last 20 years. Hoover is a past recipient of the Alaska Journal of Commerce Top Forty Under 40, a Gold Pan Award winner for community service, served as the chairman of the Anchorage School District School Business Partner board of directors, was a founding member of the UAA Alumni Association and is an honorary commander for the 176th Alaska Air National Guard Wing.

OPINION: I award you no points

Anyone who has ever wanted to see a Facebook argument come to life got their wish on Sept. 29 in Cleveland. For the less masochistic among us, you were probably covering your eyes, ears or both barely 15 minutes into the first presidential debate as former Vice President Joe Biden dropped quite likely the first “Shut up, man” in American political history. We’re far from Lincoln-Douglas or Kennedy-Nixon. The Sept. 29 spectacle didn’t even rise to the level of decorum seen in the heated Tastes Great-Less Filling debates of the 1980s. Interruptions of interruptions, insults and an overall pathetic performance by moderator Chris Wallace made for a painful 90 minutes that felt twice as long. The first topic on the Supreme Court quickly devolved as Wallace repeatedly pressed President Donald Trump on his lack of a comprehensive plan to replace the Affordable Care Act, leading Trump to drop a line about “I guess I’m debating you, not him” that he obviously had prepared but may not have expected to use so early. The debate really went off the rails a few minutes later after Biden outright refused to answer Wallace’s question about whether he supports packing the Supreme Court with additional justices or ending the legislative filibuster. Without waiting to see if Wallace would accept Biden’s refusal, Trump jumped in by pestering Biden to answer the question and asking where is his list of possible nominees to the Supreme Court. That led the beleaguered Biden to plead for Trump to shut up and then Wallace to shut the topic down without ever getting Biden to answer the question. It didn’t get any better from there. Trump continued to throw barbs at Biden, who countered by claiming Trump told people to inject bleach and is lying about progress toward a COVID-19 vaccine. Wallace repeatedly cut off Trump and many of his questions consisted of Democrat talking points, but his most outrageous moment of the night was repeating the false “very fine people” canard about Charlottesville that allowed Biden to then cite the same lie and dredge up the constant calls for Trump to denounce white supremacists. Wallace demanded Trump recite his fealty to “racial sensitivity training” and “climate change” while making the ridiculous assertion that Republican-led cities have just as much trouble as riot-filled Democrat ones by bringing up Fort Worth, Texas, and Tulsa. While tarring Trump with white supremacist associations, Wallace allowed Biden to get away with the claim that “antifa is an idea, not an organization.” Nor did Wallace fact check Biden when he brought up the anonymous claims that Trump called fallen soldiers “suckers and losers” but instead chuckled along with Biden rather than have him address the video of the former VP telling troops to “clap, you stupid bastards” after Trump brought it up. If anything, far fewer viewers can be expected to sit through another two of these and “Idiocracy” appears to be 450 years ahead of schedule. In the meantime we’re left with the academic decathlon scene from “Billy Madison.” May God have mercy on our souls. Andrew Jensen can be reached at [email protected]

Dunleavy: Gov’t lead needed for pandemic recovery

Gov. Mike Dunleavy said he expects the state’s response to the coronavirus pandemic to ultimately benefit the beleaguered tourism industry and the economic recovery from 2020 should be led by government. The governor spoke about ways to boost Alaska’s struggling economy Sept. 24 during the Alaska Chamber’s virtual annual Fall Forum gathering. He emphasized that prior to the March economic shutdowns and travel restrictions that Alaska had a solid economic foundation with several billion dollar-plus oil projects in various stages of planning and development; large investments planned to grow the cargo business at Ted Stevens Anchorage International Airport; and record low unemployment in the state. Alaska added approximately 1,300 jobs and had an unemployment rate of 5.8 percent in February. The state’s unemployment rate was reported at 7.4 percent in August, but according to the state Labor Department the number is likely artificially low because the virus has disrupted the household surveys typically conducted to compile the data. Overall, Alaska was down roughly 37,000 jobs year-over-year in August. Tourism was one of the strongest sectors of Alaska’s economy for years prior to the pandemic, but has also been one of the hardest hit by the pandemic for a host of reasons. More than 1.3 million visitors were expected to arrive to the state via cruise ship at the start of the year; however, none of them showed up — by cruise anyway. Dunleavy said state health and administration officials crafted the state’s plans and requirements for essential industry operations, notably commercial fishing, after observing COVID-19 outbreaks in the Lower 48; he also noted that Alaska’s overall COVID-19 case and death counts have been among the lowest in the country since the start of the pandemic. Alaska’s total COVID-19 case count of 8,602 through Sept. 29 is the fifth-lowest in the country; the 1,176 cases per 100,000 residents is the eighth-lowest in the country, according to data tabulated by The New York Times. “We had watched what happened at some of the meatpacking plants down south and we didn’t want to repeat that,” Dunleavy said. State officials are now working on health protocols to restart the annual parade of cruise ships through the Inside Passage next spring, he added, acknowledging the success of the work will in part be contingent upon the efficacy and availability of a coronavirus vaccine and other treatments. “The virus is going to be with us but it’s not going to control us,” Dunleavy said. “We want to show them that we can manage this virus.” How quickly Alaska’s broader tourism sector can rebound will largely depend on when the border with Canada is reopened for leisure travel as well. The U.S.-Canada border is closed to nonessential travel through Oct. 21 — a restriction that has been extended six times since March — and Canadian ports are closed to large cruise ships until Oct. 31. Federal law requires all foreign flagged vessels traveling between U.S. ports to stop at a foreign port in between. For cruises bound for Alaska, that typically means stopping in or starting from Vancouver. While the 2021 cruise season is still many months away, Brandon Lee, consul general of Canada to Alaska said during a Sept. 29 forum discussion that the Canadian government sees the pandemic primarily as a health crisis and is taking a very conservative approach to managing it. “We’re really trying to prioritize the health of Canadians,” Lee said, adding that the border situation is evaluated “day-by-day, week-by-week.” That evaluation is driven not only by case counts in the U.S., but also by the capacity in Canada’s health system, according to Lee. Dunleavy stressed that the onus for Alaska’s broader economic recovery is on government because it was government restrictions that led to the ongoing struggles. “Government has an obligation to fix and rectify what happened during the pandemic,” he said. The best way to do that, Dunleavy said is with a “comprehensive, large, multi-year approach” to infrastructure development. He added a common refrain for his administration that Alaska has the natural resources the world wants — all that’s needed is access. When asked about the infrastructure development comments, the governor’s spokesman Jeff Turner said he was likely referring to the federal infrastructure package President Donald Trump has pushed to varying degrees throughout his term. However, Dunleavy mentioned some state-specific projects and indicated his administration is working investment angles regardless of what the feds do. The administration is currently conducting pre-development analyses road projects to access resources in the Western Susitna Valley and Interior mineral prospects through the Alaska Industrial Development and Export Authority, which is also seeking private investment for those projects. “We need to refurbish our ports. We need to finish our rail spur (in the Mat-Su Borough),” Dunleavy said. “We’re exploring these opportunities with private investors and hopefully we’ll have more to announce in the next few weeks.” Dunleavy thanked Trump for signing a presidential permit authorizing a border crossing for the proposed $13 billion Alberta to Alaska, or A2A, rail link that would add roughly 1,500 miles of track to connect Alaska Railroad tracks to those in Canada. Proponents of the general concept have long seen it as a way to export resources from Northern Canada and import products to Alaska more affordably. The A2A project is specifically aimed at exporting Alberta tar sands oil through Alaska to world markets, but the project’s backers note it could be utilized for other shipments as well. Elwood Brehmer can be reached at [email protected]

FISH FACTOR: ASMI survey sheds light on pandemic impacts

Some surprising results are revealed in the first of a series of briefing papers showing how Alaska’s seafood industry has been affected by the pandemic from dock to dinner plates. The updates, compiled by the McDowell Group for the Alaska Seafood Marketing Institute, show that so far the amount of seafood that has been harvested is in line with previous years. “While 2020 harvests have been significantly lower in some salmon fisheries…the declines are due to weak runs rather than reduced effort or other forces that might have some connection with the pandemic,” according to the latest brief. “If we forgot about the pandemic and we just look at how much has been harvested, we’re similar to past years, so that’s a vote of confidence there,” said Garret Evridge, a McDowell fishery economist. Market disruptions and increased operating costs definitely put downward pressure on the value of all that seafood, with the price plummet at Bristol Bay being perhaps the most striking example. The preliminary value of the Bay’s fishery this year is $140.7 million (not including post-season bonuses), compared to the all-time high of $306.5 million in 2019. “And that certainly seems to be the trend across nearly all species. Generally, the pandemic has depressed prices across the board,” Evridge said. Also pushing down the value was a smaller processing work force. The extra efforts to manage and mitigate COVID-19-related risks “are believed to be the primary cause of a 13 percent overall decline reported for July 2020, a decline of 2,500 jobs from July 2019,” the September brief said. Chaotic market changes also forced workers to produce lower valued salmon products. Using Bristol Bay again as an example, where a compressed run plugged processing plants with millions of salmon, time and labor constraints meant that most of the fish had to be headed/gutted and frozen or canned instead of being trimmed up for pricier fresh or frozen fillets. “What that effectively does is it reduces the average value per pound of the Bristol Bay pack, which is particularly difficult in a year when operating costs have increased so much,” Evridge said. Those added costs aren’t going away anytime soon. There are no hard data yet but interviews with processors indicate at least $50 million has been spent so far by inshore and offshore sectors, said Dan Lesh, a McDowell senior analyst. “It’s definitely an estimate and it’s a number that’s likely to increase, not only through the end of 2020, but into 2021 and as long as this pandemic is in effect. We’re trying to communicate that the industry is sustaining real operating cost increases,” Lesh said. “The industry is taking on these costs out of pocket at the same time we are facing severe disruption in key markets and multiple pre-COVID cost burdens,” said Cora Campbell, CEO of Silver Bay Seafoods at a July 29 U.S. Senate committee hearing. “While a fraction of these costs may be reimbursed, we face significant uncertainty because there’s no specific congressional directive to support health and safety protocol costs for critical seafood supply chains,” Campbell said, adding that COVID-19 prevention measures have not been included so far in federal relief loans and funds. The McDowell team is waiting a few more months to get a better understanding of how COVID-19 has affected volumes and values of Alaska’s top export. August and September are the peak export months for Alaska seafood; for salmon, about 75 percent of annual exports (by value) occur between July and October. One advantage, Evridge said, is that global currency rates are playing in our favor. The dollar has trended weaker since February, making Alaska seafood more affordable to foreign buyers. “It’s important to focus on these bright spots,” Evridge said. “But there still is a big trade imbalance there with Russia, not to mention the ongoing trade war with China.” Overall, and despite all the difficulties, Evridge called 2020 “largely a success” for Alaska’s fisheries. “We’re still harvesting 5 to 6 billion pounds of seafood, the values are down, but we haven’t fallen off a cliff,” he said. “If you just think back to the early stages of the pandemic, we were talking about the possibility of Bristol Bay not even opening and some of the worst scenarios weren’t actually realized. So that’s a real positive.” Dinner plate update Seafood is benefitting from three major eating trends during the pandemic and they are expected to continue. “The first is the huge increase in home cooking as fewer people eat in restaurants,” said John Sackton, founder of “Second is the big increase in using frozen food, which is especially advantageous for the seafood industry, and third is the continued emphasis on health and diet during the pandemic.” He added that national trend tracker IRI has been reporting on changes in protein and frozen food at retail grocery, and that the trends for both frozen and fresh seafood continue to be more positive than any other category. “The continued strength of seafood consumption suggests that the strong performance of seafood at home will continue through the holidays and into the Lent season next year,” Sackton said. That’s backed up by surveys done by the Alaska Seafood Marketing Institute, which has been quickly adapting to the challenges and opportunities posed by the pandemic. “In December of 2019 before COVID, 70 percent of consumers cooked three times a week at home, and since COVID, 66 percent said they now cook at home more frequently,” said Arianna Elnes, an ASMI spokesperson. She added that for the first half of 2020 restaurant sales were $65 billion lower, while U.S. grocery store sales for all products were up $43 billion from the same time last year. To accommodate the increased interest in frozen foods and food safety, Elnes said ASMI quickly revamped its flagship “Cook it Frozen” campaign. “This focused on filling the pantry and freezers and featured at a glance cooking tips and recipe ideas to help consumers build confidence in cooking wild Alaska seafood at home,” Elnes said. “The campaign was launched in March, right at the onset of COVID, and in May frozen seafood sales at retail were up 66 percent.” ASMI also has partnered with notable chefs and dieticians on Instagram for Seafood Sundays and other cooking specials. Its survey of more than 13,000 consumers also showed that consumers want to know where there food comes from and that fishermen and farmers hold the most trust at nearly 70 percent. “We’re really trying to focus on origin,” Elnes said. “When we talk about local eating, it doesn’t just mean in terms of distance, but local as in knowing where it comes from. So we’ve launched a Choose Alaska campaign and it pitches seafood as critical to the national and global food supply chain, and it lets people know that when they’re buying Alaska, they’re supporting people’s livelihoods.” Elnes added that direct marketing by more fishermen also is on an upward trajectory. ASMI has posted a short survey to identify ways to assist with direct sales. Laine Welch lives in Kodiak. Visit or contact [email protected] for information.

GUEST COMMENTARY: Ballot Measure 1 will hurt Alaska’s struggling nonprofits

COVID-19 has done a number on Alaska’s non-profit community. Most of the major fundraising events were either cancelled outright, or scaled down and conducted virtually. Millions in revenues have been lost. Every nonprofit in this state is nervous about the future. If we are going to recover, we will need more community support than ever. That means we need to defeat Ballot Measure 1. The nonprofit sector makes up a critical component of the state economy. In fact, Alaska nonprofits play a vital role in the state’s other major industries including seafood, finance, healthcare, and tourism. The nonprofit sector is woven into the fabric of Alaska in every way conceivable, delivering essential services like housing, education, and environmental protection to residents statewide. Outside of charitable individuals, Alaska’s nonprofits are funded by the oil and gas industry. In fact, it’s almost impossible to find a nonprofit partner list in Alaska that doesn’t include an oil and gas company. In the nonprofit world, we look for long-term solutions to problems. Ballot Measure 1 is a shortsighted approach to a long-term problem, and will hurt more than it is intended to help. The nonprofit I am proud to represent provides young Alaskans the tools and knowledge they need to make smart academic and economic choices as they grow into financially savvy adults. Our top corporate donors work in the oil and gas industry, and their support has helped us educate youth for decades. Ballot Measure 1 puts that support in jeopardy by increasing taxes on a struggling industry by between 150 to 300 percent. COVID-19 has already wreaked havoc on the entire statewide economy, and targeting one industry for a massive new tax will only make the situation worse. Should Ballot Measure 1 pass, not only would our economy and jobs be at risk, but Alaska’s thriving nonprofits would suffer the consequences, too. Many nonprofits are clinging to life during the ongoing pandemic. Now is not the time to create barriers for growth our state’s largest economic force. Oil and gas sets the pace in Alaska. The industry alone generates 38 percent of all wages in Alaska, and a quarter of all jobs. But those jobs are just the tip of the iceberg when it comes to the full social and economic impact of oil and gas in Alaska. From the arts, to youth and social service organizations, nonprofits across Alaska benefit from healthy, sustained oil and gas spending. The industry has funded STEM programs, food pantries, animal rescue agencies, women’s shelters — the list goes on — for decades. I’m voting No on Ballot Measure 1 this November, and I encourage my nonprofit partners to do the same. Together, we can rebuild and strengthen Alaska alongside the oil and gas industry, protecting our jobs, families, economy, and essential nonprofits. Flora Teo is the president of Junior Achievement of Alaska.

GUEST COMMENTARY: Small manufacturing firms continue to drive Alaska economy

Local manufacturing businesses and jobs have experienced a resurgence in recent years that needs to continue for our state’s livelihood and connection to the global economy. Before the pandemic, the manufacturing sector employed 11.6 million workers in the United States. During the past three years, approximately 500,000 manufacturing jobs were added to the economy. In 2018 alone, 264,000 manufacturing jobs were added, the most created in any single year in more than two decades. Locally in Alaska, there were more than 12,000 manufacturing jobs. Of those, 33 percent were employed by small firms. While manufacturers have not been immune to the hit we’ve seen many sectors take during 2020 due to the pandemic, we’re already seeing the manufacturing sector start to rebound. In fact, 29,000 manufacturing jobs were added in August 2020 alone. This is both encouraging and necessary for our region as consumers worldwide are increasingly seeking “Made in the USA” products and services. On a macro level during the past couple decades, U.S.-manufactured goods that are exported to other countries have quadrupled. Plus, nearly six in 10 U.S. export dollars come from manufacturers, establishing them as a crucial component to our role in the international marketplace. In North America specifically, the passage of the U.S.-Mexico-Canada Agreement earlier this year has and will continue to drive job creation and strengthen manufacturing in Alaska. And since the USMCA establishes a committee on small business issues for the first time in any U.S. trade agreement, it will ensure small manufacturing voices are heard. As local manufacturers are pivoting and innovating to operate in a new environment — and in some cases, switching production to support critical needs of medical equipment and personal protective equipment — it takes public and private entities working together for small manufacturing firms to succeed. The federal government is clearing red tape out of the way for small manufacturing firms by reducing regulations. During the past few years, federal agencies have issued multiple deregulatory actions for every new significant regulatory action, saving businesses billions in regulatory costs. In light of the coronavirus pandemic, many federal regulations have been temporarily lifted; and, regional advocates from the SBA Office of Advocacy are talking to businesses to explore opportunities to permanently clear some of these regulations if they have been burdensome to small firms. In the span of a week this past spring, the SBA rolled out one of the largest economic recovery programs the country has ever seen. Financing programs like the Paycheck Protection Program, Economic Injury Disaster Loan program, and traditional SBA loan programs have preserved Alaska jobs and infused approximately $1.8 billion into Alaska small businesses in 2020. With federal programs, local government, and industry and business organizations working together — combined with the ingenuity of Alaska small businesses — the manufacturing industry will prevail and ultimately thrive. Jeremy Field is the Regional Administrator for the U.S. Small Business Administration Pacific Northwest Region which serves Washington, Oregon, Idaho and Alaska.

Law Dept. seeks clarity on potentially broad impact of bond ruling

The Dunleavy administration is asking the Alaska Supreme Court to clarify whether a recent ruling invalidating a plan to sell bonds to pay oil tax credits impacts hundreds of millions of dollars worth of bonds sold for local governments across the state. Department of Law attorneys on Sept. 28 technically filed a petition for rehearing the lawsuit against the state for a legislative plan passed via House Bill 331 in 2018 to sell up to $1 billion in bonds to pay off outstanding oil and gas tax credits owed to banks and small exploration companies. The state’s tax credit obligation currently stands at $743 million, according to the Revenue Department. However, administration officials are not asking the court to reconsider its unanimous Sept. 9 ruling that HB 331 violates the Alaska Constitution’s strict sideboards on the state’s ability to acquire debt. They want to know whether the ruling applies to much of the work done by the Alaska Municipal Bond Bank Authority, which sells bonds on behalf of local governments across the state and can almost always secure a lower interest rate than the individual communities. “The State does not ask the Court to change its holding invalidating HB 331 and, by extension, directly analogous bonding schemes. But the Court’s opinion has unfortunately created significant uncertainty about debt that is structurally much different from HB 331,” state attorneys wrote in their petition. “Because the debt markets are very cautious, this uncertainty could hinder the ability of Alaska’s state and local governments to obtain reasonable access to capital programs that were not considered by the Court or addressed by the Court’s decision. The State seeks rehearing to request a limited clarification to the scope of the Court’s decision so that existing, important programs that differ significantly from HB 331 may continue to effectively operate.” Joe Geldhof, the longtime Juneau attorney active in state politics who won the case against the state, said the root of the issue is the “subject to appropriation“ clause contained in the bond materials that could ultimately put the state on the hook if a local government fails to repay its debt. Juneau resident and former University of Alaska regent Eric Forrer filed the lawsuit. It is a serious open question as to whether the bonds sold by the bond bank are impermissible under the ruling, Geldhof said, because the state is using its credit rating to secure lower-cost financing for local governments. The local government bonds used for facility and infrastructure projects are backstopped by language assuring buyers that the State of Alaska will repay the debt if need be via a legislative appropriation. Over the past decade the approach has funded 158 loans and saved $216 million statewide, according to figures in the petition. Geldhof said the ruling should deal with bond sales going forward, not bonds already sold by the state bond bank, and also accused state officials of ignoring the issue. According to the petition, the bond bank board authorized two bonds totaling $247.8 million to refinance 31 existing municipal bond issues. A sale planned for Sept. 14 — shortly after the ruling was published — to refinance 22 bonds and save $8.8 million has also been delayed. “There is 100 percent certainty that the Department of Revenue knew this was problematic,” Geldhof said. Department of Law and Revenue officials did not respond to questions in time for this story. State attorneys wrote that state corporations have a “long-established and important” practice of selling revenue bonds backed by a “moral obligation pledge.” The bonds are repaid with revenue — municipal funds in the case of the bond bank — from other sources than the state general fund and therefore meet the revenue bond exemption in the state constitution, according to the petition. “But these entities’ bonds also include, as a backstop, a non-binding pledge that if those revenues and other security for the bonds are insufficient to pay debt service, then the entity will request that the Alaska State Legislature make an appropriation to replenish a reserve fund that further secures those bonds,” state attorneys wrote. The underwriting is similar to how the bonds contemplated in HB 331 were to be structured; Revenue officials would sell bonds with the “subject to appropriation” clause that would not legally bind the state to make payments, but could impact the state’s credit rating, which the court decisively concluded made the scheme unconstitutional. Alaska Municipal League Executive Director Nils Andreassen said the Alaska Municipal Bond Bank Authority’s work on behalf of local governments is important for the financial considerations but also because of state officials’ expertise in the bond arena “That capacity just doesn’t exist for small or medium-sized municipalities,” Andreassen said. He added that the bond bank can also bundle small government bond packages together to make them more attractive to buyers and thus achieve better rates. “It’s incredibly important to keep (borrowing) costs low,” Andreassen said. Municipal League leaders would be following the case closely, he said. The Alaska Constitution requires most bonds sold by the state other than true revenue bonds be approved by voters and Geldhof said state officials have put the state’s credit rating on the line without the public’s consent with the municipal bond sale practice. Bond buyers want to know the state will backstop the debt otherwise owed by local governments often with limited financial resources, he said. “This is the politicians in bed with the money boys,” Geldhof said. Elwood Brehmer can be reached at [email protected]

Forest Service affirms preference to repeal Tongass ‘Roadless Rule’

The Trump administration continued its agenda to aggressively open more federal lands in Alaska to development activity Sept. 25 with a recommendation for a full exemption from the Roadless Rule for the Tongass National Forest. Fully repealing the Clinton-era prohibition on new roads across much of the national forest system would open all 9.2 million acres currently classified as roadless in the Tongass to potential mining, logging, and energy development, all of which are made much easier with road access in the forest’s predominantly mountainous terrain. At roughly 17 million acres, the Tongass covers the vast majority of Southeast Alaska and is by far the largest national forest in the country. The formal announcement from U.S. Forest Service officials of their preference for a full, Tongass-specific exemption from the Roadless Rule in the final environmental impact statement that examined six options — from status quo to the complete exemption — was welcomed by Alaska’s Republican leaders, but it was not unexpected. U.S. Department of Agriculture officials overseeing the Forest Service preferred a full exemption in the draft EIS review published last October. While the state Southeast timber industry interests have been trying to lift the Roadless Rule from the Tongass unsuccessfully in the courts since it was applied in 2001, Gov. Mike Dunleavy said the recommendation moves the region closer gaining improved transportation infrastructure, among other economic benefits in a prepared statement. Sen. Lisa Murkowski noted during a Sept. 25 video conference with leaders of the regional development organization Southeast Conference even though the rule covers more than 9 million acres, repealing it will only make about 168,000 additional acres of old-growth timber stands available for harvest under the current land-use plan for the Tongass. “It is about reasonable access for a wide variety of users,” Murkowski said, “It is for all pieces of the Southeast economy.” The latest iteration of the Tongass Management Plan, which guides Forest Service timber sales and other on-the-ground activities, was approved by the Obama administration in 2016. Murkowski, who chairs the Senate Energy and Natural Resources Committee and Alaska timber groups have criticized the current management plan for pushing a shift from old-growth to second-growth timber unrealistically quickly before sufficient second-growth stands are ready for harvest. Commercial fishing, conservation and some tourism groups insist Southeast’s economy has moved on from its heavy reliance on the timber industry as a fundamental driver, which mostly peaked in the early 1990s, and has moved to — at least before the pandemic — a base of tourism and fishing. They also argue the Trump administration’s policy directly contradicts the vast majority of the public that has weighed in on the issue. According to a Forest Service report detailing the nearly 270,000 comments the agency received late last year on the draft plan to repeal the Roadless Rule, 96 percent of the 15,909 unique letters supported maintaining the rule in full. They contend that no specific projects seeking exemptions over the years from the rule’s requirements in the Tongass have been denied. However, Southeast Conference Executive Director Robert Venables said the Roadless Rule has increased the cost of energy projects across the region — making some wholly unfeasible — simply by increasing access costs. Meanwhile, the federal fiscal watchdog group Taxpayers for Common Sense insists the country has lost nearly $600 million from its Tongass timber sales over the past 20 years when adjusted for inflation. Taxpayers for Common Sense totaled the Forest Service’s $632 million in costs for timber sale preparation, reforestation and road building and put that against the $33.8 million collected on a per board-foot basis by the agency from those harvests. Again, those figures are adjusted for inflation to 2018 values. Trump administration officials from other resource agencies have similarly advanced broad rollbacks of development prohibitions on federal lands in Alaska. The Bureau of Land Management has championed multiple plans to open nearly all available federal lands on Alaska’s North Slope — most notably the Arctic National Wildlife Refuge coastal plain — to oil and gas exploration and approved a 200-mile road to Interior mining prospects; the Bureau of Ocean Energy Management has promoted making 90 percent of the federal waters off Alaska available for oil leasing; and the Interior Department has twice had its agreements to facilitate a road through designated wilderness of the Izembek National Wildlife Refuge shot down in federal court. However, the action on the Roadless Rule didn’t officially originate from Washington, D.C. Former Gov. Bill Walker’s administration petitioned the USDA in 2018 to initiate the process to exempt the Tongass, on some level, from the Roadless Rule. While several attempts to legally invalidate the rule have fallen flat, Idaho and Colorado previously secured exemptions from aspects of the rule. USDA and Forest Service officials now must wait at least 30 days before singing the record of decision to make the final determination effective. Elwood Brehmer can be reached at [email protected]

Pebble CEO Collier resigns after release of tapes

Pebble Limited Partnership CEO Tom Collier resigned on Wednesday after an environmental group released secretly recorded videos of Collier and Ron Thiessen, president of Pebble parent company Northern Dynasty Minerals, discussing their connections and influence with Alaska politicians and regulators. Northern Dynasty also issued an apology to “all Alaskans," according to a statement released by the company. Northern Dynasty’s senior management and board of directors accepted Collier’s resignation, the statement said. “Collier’s comments embellished both his and the Pebble Partnership’s relationships with elected officials and federal representatives in Alaska," the statement from Northern Dynasty said. The embellishments involved Gov. Mike Dunleavy, Sens. Lisa Murkowski and Dan Sullivan and senior representatives of the U.S. Army Corps of Engineers, among others, Northern Dynasty said. “The comments were clearly offensive to these and other political, business and community leaders in the state and for this, Northern Dynasty unreservedly apologizes to all Alaskans,” the statement said. Reached Wednesday, Collier declined to comment and said he would no longer speak with news media. The Environmental Investigation Agency, an environmental group, hired individuals in August and September to pose as potential investors in the project, in online video meetings with the Pebble executives. The group released the videos on Monday. In response, Dunleavy, Murkowski and Sullivan strongly denounced the statements by Collier and Thiessen as false and embellished. The Army Corps also issued a statement on Tuesday, noting that the executives had presented inaccuracies and falsehoods, including about the permitting process. The actors for the environmental group posed as representatives of a Hong Kong-based investment firm with links to a state-owned entity in China, Northern Dynasty said. “The unethical manner in which these tapes were acquired does not excuse the comments that were made, or the crass way they were expressed,” Thiessen said in the statement. “On behalf of the company and our employees, I offer my unreserved apology to all those who were hurt or offended, and all Alaskans.” Among other statements, Collier described Murkowski and Sullivan as merely making political points when they said in August that the Corps can’t permit the mine, statements the senators denied. Collier also described his close access to the governor’s office, and said he counted Dunleavy as a friend, prompting the governor’s office to broadly reject the statements made in the videos. Former Pebble Partnership CEO John Shively will serve as Pebble’s interim CEO while the company seeks a new leader, the statement said. The proposed copper and gold project would be built about 200 miles southwest of Anchorage, near headwaters of the valuable Bristol Bay salmon fishery. Critics say it will hurt the commercial fishing industry and subsistence fishermen there. The Army Corps of Engineers is in the final stages of determining whether to issue a permit for the project that could lead to its construction. A final decision could be issued soon. President Donald Trump recently tweeted about the project, saying there would be “NO POLITICS” in the permitting decision. The Alaska Miners Association on Wednesday also condemned Collier’s comments. “Mr. Collier’s comments were clearly inappropriate and we appreciate Northern Dynasty for swiftly handling this issue," said Deantha Skibinski, the group’s executive director. "Our mining operations and projects have a superb track record of meeting the high standards set forth in the regulatory process, and we do so with a commitment to safety and environmental protection.” Shively, the state’s former Natural Resources commissioner under Democratic Gov. Tony Knowles, served as Pebble’s chief executive until 2014, when Collier took his place. Collier, a former chief of staff to Interior Secretary Bruce Babbitt, led the Pebble project through tumultuous years, including a move by the Obama administration that essentially halted the project in 2014, followed by progress under the Trump administration. Collier was scheduled to receive about $4 million from Pebble if the Corps issued a permit decision favoring the mine, and roughly another $8 million if the project survives litigation, he has said. It was unclear on Wednesday what would become of that possible bonus. “We don’t comment on personnel or contract matters related to current or former employees,” said Sean Magee, a spokesman with Northern Dynasty Minerals. Thiessen remained in job on Wednesday, the company said. Major questions loom for the project, including how Pebble will meet steep requirements set by the Corps to compensate for the environmental damage the project will cause. The United Tribes of Bristol Bay, representing 15 tribes opposed to the mine, said Collier should not be the “scapegoat” for the project, according to Alannah Hurley, the group’s director. “His resignation does nothing to address the deep-seated flaws and issues with the Pebble mine’s rigged permitting processes and political influence,” Hurley said. Thiessen, like Collier, also made statements in the videos that drew strong rebukes from Alaska leaders. Thiessen says in the videos that the company can get Dunleavy to call White House chief of staff of Mark Meadows about the project. That statement and others by the Pebble executives are not true, Dunleavy’s office said. Thiessen said Pebble is trying to work with Sullivan so the senator doesn’t say anything that could harm Pebble’s effort to receive the permit from the Corps. Sullivan’s office on Tuesday called that “yet another fabrication.” Sullivan and Murkowski have both said the mine does not meet environmental regulatory standards. They have said a record of decision supporting a permit, or a ROD, should not be issued. Robin Samuelsen, an adviser for Commercial Fishermen for Bristol Bay, representing fishermen opposed to the project, said in a statement on Wednesday he often got hit with a rod as a kid, on his behind. “And that’s what I’m asking Senator Sullivan and Senator Murkowski to do,” he said. “Take out the rod, it’s time to spank 'em. They’ve lied to you, they’ve lied to us out in Bristol Bay, they’ve lied to Alaska and they’ve lied to the world.” Shively, recently the board chair for Pebble Mines Corp., general partner for Pebble Partnership, said in the statement on Wednesday that the project is too important not to be built. “My priority is to advance our current plan through the regulatory process so we can prove to the state’s political leaders, regulatory officials and all Alaskans that we can meet the very high environmental standards expected of us,” he said.

Fed expected to keep interest rates near zero through 2023

WASHINGTON — The Federal Reserve is likely to keep interest rates pinned near zero at least through 2023, according to projections released Sept. 16 that also show Fed officials are more upbeat about the near-term prospects for the pandemic-battered U.S. economy. The central bank also began to put into effect its recently announced policy framework that will essentially maintain low interest rates longer. In its statement Sept. 16 after a two-day meeting, the Fed said it would aim to push inflation moderately above its long-held 2 percent target — once largely viewed as a ceiling — and that it won’t raise interest rates until this and other related goals are achieved. Analysts said that means it could be five years or longer before the Fed raises rates. “If you take the forecast on its face, yeah, this is years and years,” said Diane Swonk, chief economist at the accounting and consulting firm Grant Thornton in Chicago. The Fed’s brighter economic outlook reflects the stronger-than-expected recovery in the labor market and other sectors of the economy since more businesses reopened this summer, however halting and uneven that has been. More recently, however, data on job postings, small-business revenues and consumer spending suggest that the economy has been moving sideways, if not backsliding a bit, according to Opportunity Insights, a nonpartisan group based at Harvard that is tracking the economic effects of the pandemic. In June, Fed officials foresaw the unemployment rate at 9.3 percent in the fourth quarter, but government officials reported the jobless figure dropped to 8.4 percent in August from a high of 14.7 percent in April. The new projections show that officials, on average, are now looking for unemployment to end the year at 7.6 percent and to decline to 4.6 percent by end of 2022, compared with 5.5 percent in Fed policymakers’ forecast three months ago. Before the pandemic hit, the jobless rate had fallen to 3.5 percent, a 50-year low that opened more doors especially for less-educated and other disadvantaged workers. And Fed Chairman Jerome H. Powell, in a news conference Sept. 16, said he would “love to get back to that,” noting that with unemployment at that level, gains “being shared vary widely across the income spectrum. In fact more to people at the bottom end of the spectrum.” But most Fed officials don’t see unemployment returning to pre-pandemic levels until after 2023; and that’s another reason rates are likely to stay at rock bottom for years to come, said Chris Rupkey, chief financial economist at MUFG Bank in New York. “This argues for interest rates staying lower for longer to make sure the economic expansion is durable and lasting and that all those who lost their jobs this year are able to rejoin the workforce,” he said. The government’s August jobs report said that the economy has recovered about half of the 22 million payroll jobs lost in March and April, but separate data also show that some 30 million people claimed unemployment benefits in August. Fed policymakers also painted a more sanguine picture of economic growth. Three months ago, Fed officials on average saw gross domestic product, the sum of goods and services produced in the nation, falling 6.5 percent this year and then growing 5 percent in 2021. They now see GDP contracting 3.7 percent this year and expanding 4 percent in 2021. Still, Powell acknowledged that the outlook remains highly uncertain and hinges on the path of the pandemic. What’s more, he said that Fed officials made their projections based on the assumption that there will be additional fiscal support, which is not at all clear will be forthcoming. “The fiscal policy actions that have been taken thus far have made a critical difference to families, businesses and communities across the country,” he said. “Even so, the current economic downturn is the most severe in our lifetimes. It will take awhile to get back to the levels of economic activity and employment that prevailed at the beginning of this year, and it may take continued support from both monetary and fiscal policy to achieve that.” The Fed has moved aggressively to support the recovery, and its new policy approach — although in the works well before the coronavirus outbreak — could have significant long-term effects, including risks of increasing speculation and asset bubbles. The shift in strategy, which Powell announced Aug. 27, means the Fed will focus more on expanding employment and worry less about meeting its 2 percent inflation target. Inflation has been running well below that target for years, and under the new approach, the Fed would shoot for an average 2 percent inflation rate, giving it more flexibility to allow inflation to rise above that level for some time before moving to raise interest rates to avert a potential overheating in the economy. In its Sept. 16 statement, the Fed said it “will aim to achieve inflation moderately above 2 percent for some time so that inflation averages 2 percent over time and longer-term inflation expectations remain well anchored at 2 percent.” And until those goals are achieved, it said, the Fed would maintain its current easy-money policies. Powell declined to say more specifically what “moderately above” means. Nor would he get pinned down on the time frame for letting inflation rise above 2 percent, saying only that it’s “not permanently and not for a sustained period.” “We are resisting the urge to try to create some sort of a rule or a formula here,” he said. The policy statement was supported by Powell and seven of his colleagues. Two voting members dissented. In their Sept. 16 projections, the vast majority of Fed policymakers see rates staying near zero through 2023, which is as far as the forecast goes. In the longer run, Fed officials expect its benchmark interest rate to rise to 2 percent to 3 percent, well below historical levels.

Cruise industry offers ideas to allow resumed sailings

Cruise companies are stepping up their pressure on U.S. health authorities to allow them to cruise again amid the COVID-19 pandemic. On Sept. 21, Royal Caribbean Group and Norwegian Cruise Line Holdings submitted health and safety protocols to the U.S. Centers for Disease Control and Prevention as part of the agency’s request for public comments about how to safely resume cruises. The protocols include testing all passengers and crew for COVID-19 before boarding, requiring masks and expanding medical capabilities on cruise ships. The cruise industry’s lobbying group, Cruise Lines International Association, sent a separate, less-specific list of recommendations to the CDC on Sept. 21, vowing that all cruise companies will require testing before boarding, masks and social distancing; improve ventilation and medical capabilities; and limit shore excursions. Sept. 21 was the final day to submit public comments to the CDC about cruising during the COVID-19 pandemic. The CDC has banned cruises in the U.S. until Oct. 1, and most cruise lines have said they will not resume cruises until at least Oct. 31. “We’ve learned a lot in six months,” said Royal Caribbean Group Chairman Richard Fain. “Our job was to find a way going forward to learn from the past, and not to repeat it.” Norwegian Cruise Line Holdings CEO Frank Del Rio said it was “absolutely” safe to resume cruises again, citing the announced protocols. “There is not one silver bullet,” he said. “It’s layer on top of layer on top of layer … We’re going to test it, make adjustments along the way.” A spokesperson for the CDC said the agency has not requested plans to resume passenger cruises from the companies. “Currently, CDC does not have enough information to say when it will be safe for cruise ships to resume passenger operations,” the spokesperson said in an email. “CDC will continue to work with cruise lines to ensure that all necessary public health procedures are in place before cruise lines begin sailing with passengers.” Carnival Corporation CEO Arnold Donald said it typically takes 30 days to get a laid-up ship running again. The 74 recommended protocols submitted to the CDC on Sept. 21 by Royal Caribbean Group and Norwegian Cruise Line Holdings were hashed out by a panel of experts, including several that used to work for the CDC. The panel said it is impossible to eliminate the risk of COVID-19 spread at sea, but with their recommendations, that risk can be minimized. The panel did not determine an infection threshold on land that would make it safe to resume cruises but instead focused on what companies can do to bolster health and safety on ships. “Getting down to zero risk is not likely,” said former Utah Gov. Mike Leavitt, who chaired the Royal Caribbean Group and Norwegian Cruise Line Holdings panel. “Therefore we have to have the component of mitigating spread and ability to respond.” Some of the recommendations include: • All passengers should be tested for COVID-19 between five days and 24 hours prior to boarding • Crew should be tested in their home countries before leaving to join a ship and then again at the end of a seven-day on board quarantine period, ideally using PCR tests. • Both passengers and crew should have their temperatures taken daily. • Cruise companies should visit only ports that agree to evacuate and repatriate sick people on board. • All ship heating and air-conditioning systems should be upgraded to MERV 13 filters, similar to those used by hospitals. • Ships should lower doctor-to-passenger ratios on board. • Crew should live in single cabins whenever possible and be allowed limited shore leave. • Passengers who don’t attest that they agree to protocols not be allowed to cruise. A protocol that was floated in March as cruise companies scrambled to try to avert a shutdown was barring passengers over 70 years old, who are particularly vulnerable to the effects of COVID-19. That was scrapped by the panel. Passengers who are at higher risk will instead be advised to consult with their doctors before cruising. Carnival Corporation, the largest cruise company in the world, endorsed the CLIA proposals, which include testing; that’s already being conducted on its Costa Cruises ships in Italy. “This has been probably the most difficult period in our industry’s 50 year history,” said CEO Donald. “We are on a path with the industry to resume cruise operations in the U.S. using the knowledge from our advisors and in full cooperation with the authorities.” Preventing COVID-19 spread on cruise ships is exceptionally difficult, health experts say. At least 110 passengers and crewmembers have died from COVID-19, at least 38 in Florida, according to a Miami Herald investigation, and at least 86 ships have been affected — approximately one-third of the global cruise fleet. Cruise companies have struggled to contain COVID-19 outbreaks among crew members on their ships during the industry’s pause. On several occasions, even after months of isolation at sea, crew members tested positive upon returning to their home countries. CDC data obtained by the Miami Herald via a Freedom of Information Act request shows at least seven ships in U.S. waters during the month of August reported COVID-19 or COVID-like illnesses to the CDC that month. Carnival Corporation and Virgin Voyages pulled their ships out of U.S. waters in June and are no longer reporting illnesses to the agency. Norwegian Cruise Line Holdings is reporting from just three of its ships.

DEC: Shortfall in spill response fund requires revenue or appropriation

State environmental regulators are seeking more money for Alaska’s spill response fund amid a comprehensive review of the requirements for petroleum producers and shippers. Department of Environmental Conservation Commissioner Jason Brune said during a Sept. 18 meeting of the Prince William Sound Citizens’ Regional Advisory Committee that he is advocating for the Dunleavy administration and Legislature to commit more funding to the state’s shrinking Spill Prevention and Response fund. The conclusion that the SPAR fund needs additional help — most likely through a general fund appropriation — comes as the state is facing a fiscal year 2022 budget deficit of roughly $2 billion. It also goes against the grain for an administration that has pushed for often deep spending cuts across state government to erase the state’s ongoing deficits and finance paying larger Permanent Fund dividends without additional taxes. Brune acknowledged the challenges inherent in asking for more money given the state’s fiscal situation but said the need for a robust SPAR fund necessitates it. He said seven positions were cut last year from the SPAR team of more than 100. “It remains a priority of mine to bring sufficient funding to SPAR,” he said to the council board. “It’s going to be a heavy lift, but it’s one I’m going to attempt to make.” Department officials declined to specify the size of the SPAR request to the Office of Management and Budget but spokeswoman Laura Achee wrote via email that they “recognize that there are funding sustainability issues for SPAR and are committed to working with the Legislature to address them.” DEC officials have also supported increasing the surcharge on refined fuel products sold in the state from 0.95 cents per gallon to 1.5 cents to help cover an anticipated revenue shortfall in the fund. The refined fuel surcharge — dedicated to the prevention account in the fund — was implemented in 2015 to further support the SPAR fund, which had largely relied on a 5-cent per barrel charge on oil produced in the state for revenue. Money from fines and settlements related to hazardous substance spills is also deposited into the prevention account. When the roughly 1-cent per gallon surcharge was put on refined products it was expected to bring in approximately $7.5 million per year, but actual revenue has been about $1 million short of that. The account held $8.5 million at the end of 2019, according to DEC’s annual SPAR report. Overall, more than $25 million was spent from the SPAR fund in fiscal 2019, including a $9.4 million capital appropriation to pay for PFAS cleanup at state-owned airports, while just $16.3 million was collected; the vast majority of which came from the surcharges. The Legislature also spent $5 million from the response account in 2018 to export contaminated oil from a Wrangell junkyard. Brune said he believes the pandemic will exacerbate the funding issue. “With COVID, people are just driving less; they’re working from home and not traveling,” meaning less fuel subject to the surcharge will be sold, he said. He also questioned whether it is appropriate for cleanup of contaminated sites to be paid for with revenue from fuel and oil surcharges given those products may not be the source of the contamination. The long-term solution for the fund is more North Slope oil production to apply the 5-cent surcharge to, Brune said. Spill regs review continues DEC officials are continuing their review of the state’s detailed Oil Discharge Prevention and Contingency Plan, or C-Plan, regulations for possible changes with twice-weekly meetings in which the statutes, regulations and proposed changes are vetted “line by line,” Brune said as well. “We want to make sure that we can justify what we have currently in the regulations,” he said. The department opened a scoping period to solicit comments on the highly technical operational and equipment requirements for companies producing and shipping oil and fuels last December. Numerous groups, including the congressionally mandated citizens’ advisory councils for Cook Inlet and Prince William Sound, expressed concern that changes could be made to weaken protections against a spill or the ability to respond to one by the decidedly pro-development Dunleavy administration. Gov. Mike Dunleavy made reducing the regulatory burden on industry a large part of his campaign in 2018 and his administration has initiated that work across state government. Comments from individuals were solidly against the prospect of changing the oil spill regulations, while associations — including the councils — and companies in the oil and shipping sectors largely suggested detailed technical regulatory amendments. The councils were established by Congress following the 1989 Exxon Valdez oil spill. Prince William Sound council spokeswoman Brooke Taylor wrote in response to questions about the spill regulation scoping that the council is encouraged by Brune’s commitment to hold an extended comment period on any changes that are proposed but is still concerned about the broader process that is in the works. Council leaders contend because DEC has chosen to make the entire 60-page regulatory package subject to review instead of proposing specific changes, the burden of the review has been shifted to the public, which must defend what is on the books rather than the department defending its changes. Brune has said he did not want to potentially taint the public’s review by having the department make its proposal public too early in the process. “Nothing in the regulations we will propose will increase the risk of an oil spill in Prince William Sound or anywhere else in Alaska,” he said to the council. DEC’s Achee wrote that there is no hard timeline for when the review will be complete as it is a “process-driven situation.” “If there are proposed changes, we will ensure that the public has plenty of time to review them and comment,” she wrote. Cook Inlet Citizens’ Regional Advisory Council members were told by DEC officials that the timeline for the review has been pushed back to at least the end of the year, according to the council. Elwood Brehmer can be reached at [email protected] (Editor's note: The original version of this story incorrectly reported that the Spill Prevention and Response team has about 30 individuals. It has more than 100.)

Movers and Shakers for Sept. 27

Northrim Bank announced the promotion of Brian Leonard to Branch Manager II at the Midtown Financial Center; the move of Christina Clayton to Assistant Branch Manager at the Wasilla Financial Center; and the hiring of Johnico Bashford-Blumer as Assistant Branch Manager at the Southside Financial Center. Leonard has been with Northrim Bank since 2011, starting his banking career at the Wasilla Financial Center. He holds a State of Alaska Insurance Producer-Life License. Leonard was awarded the Northrim Bank Customer First Service Award in 2013. Clayton has been with Northrim Bank since 2016. Before joining Northrim Bank, she had more than 30 years of experience in retail sales management. Clayton holds an occupational associate’s degree in retail management. Bashford-Blumer joins Northrim with 11 years of management experience and five years in the insurance industry. He holds an MBA from Colorado Technical University.


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