MY VOTE ON THE GAS PIPELINE

My vote on the TransCanada gas pipeline proposal was probably one of the most critical votes I’ll cast during my legislative service. Few votes on controversial issues are easy, and the gas pipeline vote was controversial for every legislator, however they voted. I’ve responded by email to several constituents who asked why I vote as I did. As their representative in the legislature they deserved an answer. One of my mottos is, “The better the communication, the better the representation.” I thought I would turn some of my response to constituents into this Blog, for others who may be interested.

My short answer for my “Yes” on the TransCanada license: I sincerely believed it was the best vote for the people of all Alaska. I’m well aware some good and very knowledgeable people might have an opposite honest opinion (as did several legislators). The longer answer for my “Yes” vote is a combination of many factors. Let me list just a few.

The most important factor for my vote was input from constituents - both for and against - as well as hundreds of hours of information gained from hearings throughout Alaska, from one end of the state to the other. We heard from Governor Palin’s administration and consultants, all the competing pipeline interests, plus expert consultants hired by our own Legislature.

Along with the public, our legislators were subjected to slick TV commercials and full page newspaper ads. Frankly, I didn’t pay much attention to them because they represented more “sizzle than steak.” I confess to being irritated by one proposed ad that threatened, if I didn’t vote their way, to list my name and names of other legislators, under convicted criminals, et cetera. I don’t respond well to threats. Reasonable people should be able to disagree without being disagreeable.

TransCanada, the pipeline builder selected by the administration, did no “push back” advertising about their proposal, or about the claims and promises of their competitors. TransCanada told me “that’s not our style” - that they rely on the merits of their proposals to get approvals, not commercials aimed at getting the public to pressure their legislators for a “Yes” vote weeks before an election. As a result of TransCanada not conducting an advertising counter-offensive, the general Alaska public has been getting the “story” only from those interested in promoting the Denali Project, or some form of “All-Alaska” LNG project to Valdez.

For Alaskans monitoring the pipeline hearings in person, or on Gavel-to-Gavel TV, or those with personal pipeline expertise, advertising by “whoever” was likely of little or no consequence. Those persons had much the same information required for an informed opinion as did I (even if we came to different conclusions).

Last year our legislature voted 59 to 1 in favor of the Alaska Gas Pipeline Inducement Act (AGIA). The Act established a process for applicants to compete for a state license, under which they could receive certain inducements in exchange for committing to a list of 20 “must haves.” These 20 provisions were aimed at ensuring that any Alaska gasline project protected our state’s interests. The “must haves” essentially guarantee four things; that a project move forward immediately; that new explorers be able to get their gas in the line on reasonable terms; and that Alaskans have access to the gas and jobs generated by the project. That’s what the 59-1 vote by our legislature was all about. That’s why I was a “Yes” vote on AGIA.

The three major producers chose not to apply, and that’s their right. It’s logical to assume they may not have wanted to abide by one or more of the “must haves” the legislature deemed necessary for the good of our state.

Everyone who did apply under AGIA did compete, because none of the license applicants knew who was applying and who was not. As a result of the process - proposed by the administration and enacted into law by our legislature - TransCanada’s proposal was sent to our legislature for an up-or-down vote, without amendments.

TransCanada is a quality pipeline builder that has built and is currently operating over 36,500 miles of pipeline across North America. TransCanada also accepted every one of our state’s required “must haves,” and passed the administration’s scrutiny of their application.

For me it was reasonable, after passing AGIA 59 to 1, to consider voting for an applicant who complied with AGIA, and passed the governor’s review of their proposal. I don’t think it’s fair for the legislature to establish a process, encourage businesses to engage in that process and then, a few months later, abandon the process or change the rules we had made. With some of those thoughts in mind, I think the AGIA process deserves a chance to work.

I heard nothing in the hearings to cause me to abandon the AGIA process. Unfortunately, probably more time in the hearings was spent re-debating AGIA, a law we already passed, than in debating the issue on the table i.e. whether TransCanada’s proposal sufficiently maximizes the state’s interests. That is the only pipeline issue we are here in Juneau in Special Session to vote on; a just a “Yes” or “No” vote. I think there have been unnecessary and hurtful delays in voting. Even if the TransCanada license is finally approved, such delays could cost TransCanada valuable work time because of Alaska’s short summer.

Is there risk in approving the TransCanada license? Of course. But without some risk there is no reward. Was the AGIA process perfect? No. Is TransCanada’s proposal perfect? No. But if we wait for perfection, nothing would ever get done. We have waited to get the gas pipeline “show on the road” for 30 years, and it is long past time to move things forward. It’s a truism that “perfection can be the enemy of progress.”

Many people support an “All Alaska” gas pipeline (AGPA i.e. Alaska Gasline Port Authority) from the North Slope down to Valdez. On the surface, the All Alaska route sounds good. At one time it sounded good to me, and also to Governor Palin. However, the information presented during our hearings led me to believe the best way to get an Alaska LNG project is first to build TransCanada’s proposed project through Canada to Lower 48 markets. The good news for supporters of the All-Alaska pipeline is that TransCanada’s proposal does allow for a liquefied natural gas (LNG) pipeline to be built to Valdez if sufficient gas is committed.

But right now, there’s evidence a successful LNG project would face several significant hurdles. Among the hurdles would be the difficulty in obtaining a federal LNG export license, because of the high demand for clean energy in the Lower 48. Giving preference to delivering gas to the Chinese government, rather than to citizens of the United States of America would be problematic. It’s unlikely our state would find much federal support for a project which exported gas to Asia, rather than markets in the lower 48. Moreover, the costs of an LNG project are significantly higher due to the added cost of the gas liquefaction plant and tanker ship fees. This higher cost much also be supported by less gas, because more gas is consumed in the liquefaction and transportation of LNG. Although gas currently is selling for much more in Asia than in the U.S., that price differential is likely to change in the not-so-distant future. This means that both the state and Producers ultimately could make less money from an LNG project.

The North Slope producers have also expressed their preference for a route to the U.S. through Canada since day one. That’s evidenced today by their proposed Denali Project which is currently set to compete with TransCanada. If there are, in fact, challenges with getting the Producers to commit gas to someone else’s pipeline, these challenges will be much more onerous for a project which tries to force them to ship their gas to a different market. While an LNG project would be a valuable project to have in Alaska, we must get the main line built first. Hopefully, one day we’ll benefit from both a line to Valdez and a line to the Lower 48.

I understand some individuals are concerned about running a gas pipeline through Canada, because it’s a foreign nation. But remember, the Alaska Highway also runs through Canada, and the two-nation highway has been a boon to both Alaska and the United States since World War II. Either the TransCanada or the Denali pipeline would essentially follow the Alaska Highway through both Alaska and Canada.

Let there be no doubt. The Alaska producers are good people, run outstanding business enterprises, are terrific negotiators, and have been responsible for most of our state revenue. They’ve also contributed to many wonderful community projects and activities. That said, it’s logical that a producer-owned pipeline, such as Denali, may be subjected to management decisions that would reflect the best interests of their own shareholders, rather than new shippers.

In contrast, an independent pipeline company like TransCanada would benefit from expanding their pipeline to accommodate more shippers. An independent pipeline would likely spur more exploration from drillers who had reasonable certainty of shipping any gas discovered. There’s also the issue of “rolled in rates,” meaning that under AGIA new shippers would enjoy the same shipping rates as any other shippers. I do understand that Federal Energy Regulatory Commission (FERC) has a role in determining both expansions and tariffs.

Hopefully, at some point, the North Slope producers (The Denali Project) will partner with TransCanada to the benefit of all parties. These are all smart businesspersons and, if it’s good for their shareholders, may agree to share risks and, among other things, work together to reduce regulatory delays.

There’s legitimate concern about the 500 million inducement offered to TransCanada. It’s a lot of money (but peanuts compared to what Alaska would have been obligated to under former Gov. Murkowski’s pipeline proposal). However I believe the money represents a wealth producing investment that buys Alaska a place at the table, and I think that’s pretty important. It also gets us a timeline. Most importantly, it buys us the 20 “must haves” we voted for when we passed AGIA.

I just want you to know that I put a lot of thought into my vote. As I said before, it was based on constituent contact, and my judgment of the factors presented by the administration, the competitors, public testimony, and expert consultants hired by our own legislature. When we hire consultants, it makes sense to consider what they tell us.

We have wanted and needed a gas pipeline for decades, even generations. Hopefully a pipeline may finally be on the horizon - but there are no guarantees. I certainly was reluctant to derail a legitimate pipeline proposal that resulted from a process the administration set up and we voted on, before TransCanada has a fair chance to perform. Whatever, Denali is still in the running, and we are told they are proceeding with their work.

I really felt, from everything I learned, that voting for TransCanada was the best vote for Alaska at this time. I hope I’m right. Time will tell. I’m not infallible. My vote wasn’t “political.” My vote came from my heart as well as my head. I tried to keep an open mind on everything I heard. Understandingly, some will agree with my vote, and some will not - but I do respect everyone's opinion.

I took the above photo of the House vote tally board moments after the historic vote was taken.
I have some previous Blog entries that also relate to my thinking on gas pipeline issues leading up to my vote.

Sunday, April 20, 08: “Thoughts on Denali, the Alaska Gas Pipeline”
Saturday, May 24, 08: “Tick, Tock, Tick, Tock”
Friday, June 27, 08: “Abominable No Men”
Tuesday, July 8, 08: “A Bullet Line?”
Tuesday, July 15, 08: “I Don’t Respond Well to Threats”

POLITICAL EARTHQUAKE

An Alaska political earthquake high on the Richter scale was announced in Washington DC today. Alaska’s Senior Senator Ted Stevens was served with seven federal felony indictments. Obviously, an indictment is not proof of guilt. I hope a jury finds no guilt – but “Uncle Ted” may have a tough row to hoe. Whatever, it’s only fair to credit Senator Stevens for the many benificial things he has done in the past for Alaska.

I took the photo at the right was taken July 11th, as Senator Stevens was addressing a joint session of our Alaska Legislature.

The political scandals in Alaska have been devastating to our state. Indictments, convictions, people going to jail, and rumors of more to come, have weakened the Foundation of Trust of government in Alaska. It’s not only devastating, it’s sad. That Trust must - and can - be rebuilt.

I’ve sponsored, and have had enacted into law, better and tougher ethics legislation. I’m proud of these new ethics laws, and I’ll continue down the path of supporting better laws. Maybe new ethics legislation may will assist the “ethically challenged.” Unfortunately, no law will fix the unfixable.

If any good is to come out of this mess, it may be some reaffirmation that no one is above the law, be they a millionaire, a member of congress, a state legislator, a captain of industry, or the guy next door. That’s the ideal. It doesn’t always work that way, that’s reality. But equality under the law in the United States – and Alaska – is better than anywhere else in the world.

Alaska has recovered from earthquakes before, and rebuilt foundations. I have faith that, when all this is over, Alaska politics will make us proud. One shouldn’t be in politics, unless they are an optimist. And I am.

THE “MIGHTY J” COMES TO TOWN

USS Juneau, Alaska’s capital city namesake, made a port visit today in Juneau. I attended reception today aboard the ship. Her nickname is “The Mighty J.” The grand old ship’s next stop is San Diego, where it will be de-activated after a long and distinguished history.

The Juneau served in Vietnamese waters eight times, assisted in rectifying the infamous Exxon Valdez oil spill in Alaska, assisted in Desert Storm off Iraq, and many other critical missions. The USS Juneau is an “LPD” – or an Amphibious Transport Dock vessel. She is manned by 350 sailors, 30 officers, and is skippered by Captain Dennis Mikeska.

The ship can carry troops, cargo, tanks, fixed wing aircraft, as well as helicopters. It can also carry various types of Landing Craft, boats that leave a ship and carries troop to a beachhead. The Juneau is unique in how the landing craft are deployed. The troops step aboard the Landing Craft inside the safety of the Juneau, the deck is flooded, and the Landing Craft motor out of their mother ship and head for shore!

The photos shows me enroute to the reception, and Captain Mikeska and his Executive Officer speaking to the reception.

BUOY TENDER ROUNDUP

My Chief of Staff Nancy Many and I, along with Rep. Max Gruenberg, were privileged to tour the Hickory, a US Coast Guard buoy tender vessel. The ship was in Juneau, along with other buoy tenders to participate in the 2008 “Buoy Tender Roundup” – a yearly competition to determine this year’s champion in the difficult work they do to maintain buoys off shore, in harbors, and major rivers.

I never cease to be amazed at the marvel of new technology, and especially the quality of our military.

One of the photos show me at the helm of the Hickory, with my hands on the controls preparing to pilot the ship out to sea - if you can’t trust a legislator, whom can you trust? Actually, I’m posing (as if you didn’t know). If I had to pilot this ship, we would all be in serious trouble. Another photo shows Rep. Gruenberg and me standing proudly with the Coast Guard crew in the pilothouse.

BAY BUCHANAN AND DONNA BRAZILE SHOW HOW TO DISAGREE AGREEABLY

Legislators from Alaska and other western states enjoyed hearing two great political commentators at the Council of State Governments West (CSG-W) breakfast program this morning in Anchorage: Republican Angela “Bay” Buchanan, and Democrat Donna Brazile. The friendly debate between the two national political activists, focused mainly our presumptive presidential nominees Barack Obama and John McCain. and how it might affect state politics.

I’ve met Bay Buchanan several times previously: first in California when she was Treasurer of the United States (and she autographed a dollar bill for me – legal for the Treasurer!), and later when she was directing her brother Patrick J. “Pat” Buchanan presidential campaigns.

I first met Pat Buchanan, Bay’s brother, in Corona, California when I was a candidate for US Congress in 1992 and we shared a campaign stage together (I came close to winning the congressional primary with an under-funded campaign. Unfortunately, “close” only counts in horseshoes and hands grenades). Later, in Alaska – before my election to the legislature - I drove Pat Buchanan (a very pleasant, knowledgeable fellow, with an outstanding sense of humor) all over Anchorage and the Matsu to presidential campaign events.

I hadn’t met Donna Brazile before. I liked her. She’s a very interesting and plain spoken lady from Louisiana. She was the first African-American to direct a major presidential campaign (Al Gore), and was instrumental in the successful campaign for the Martin Luther King Holiday. When asked about her preference for president in 2008, she delivered a great line, "Look, I'm a woman, so I like Hillary. I'm black, so I like Obama. But I'm also grumpy, so I like John McCain!”

Bay Buchanan and Donna Brazile demonstrated how well debaters from the far opposite ends of the political spectrum can disagree agreeably, keep their senses of humor, and work together. Perhaps Alaska Legislators can learn a lesson.

IDITAROD CHAMP MARTIN BUSER

This morning Iditarod champion Martin Buser addressed the breakfast meeting of the Council of State Governments at the Captain Cook Hotel in Anchorage. For those who read this blog from somewhere outside Alaska, the Iditarod is the 1,049 mile race dog sled mushing race from Anchorage to Nome. He told us, “The sled dogs are the true heroes of the trail. The humans just get all the attention because they can talk.” Buser has won the Idatarod four times.

Martin Buser gave an excellent insight into “Last Great Race” called the Iditarod, and related it to the organization, preparation, determination, and other qualities that make good legislators. I had never heard Buser speak before, and was quite impressed.

In the photo with Martin Buser the sled dog puppy isn't me, I’m the fat guy with the beard.

I DON'T RESPOND WELL TO THREATS

I don’t respond well to threats. Never have. Don’t now. Never will. That’s why I didn’t respond well – that’s the most printable thing I dare say – to an email sent to all sixty Alaska state legislators threatening that if I fail to vote as a certain group would want (against a license for a TransCanada built gas pipeline), my name would be listed as part of a nefarious group that includes felon Bill Allen and VECO, and the so-called “Corrupt Bastards’ Club.” Whoa now!

Newsflash! I don’t cast votes based on newspaper or TV ads - including ads that some could allege could border on extortion i.e. ads that imply, "Vote as I say, or I’ll publicly list your name among criminals."

Let me explain how I will vote on the gas pipeline proposals. I’ll continue listening to a broad range of constituents, listening to testimony from all sides at the gas pipeline hearings, and add my own reflections to the question. I’ll listen and then I’ll act - by voting “Yes” or “No” on the license for Trans Canada.

When I cast that critical vote, you can put my name in large bold letters, on any silly ad somebody wants. Let both my admirers and detractors be able to read how I voted without their spectacles.

Old John Hancock said about the same when he signed the Declaration of Independence in 1776. My votes since 2003 always reflect a declaration of independence from political threats.

A “BULLET LINE”?

Congratulations to Governor Palin and her administration from helping broker the beginning of a partnership between Enstar Gas, the State of Alaska, and the Alaska Gas Development Authority (ANGDA) to build a “bullet line” to bring much needed and affordable gas to our neighbors in Fairbanks, the Railbelt, and all of south central Alaska.

It’s very early in the process, and much could go wrong, but the “good news” an attempt is being made to address Alaska’s in-state gas needs sooner than later. Our neighbors are hurting from the high cost of gas.

According go the governor’s press-release, construction could begin within three years, with delivery to customers within five years. That would be extremely good news to consumers who need gas for heating their homes and cooking their food. This schedule could also provide jobs for Alaskans, before jobs are available on the big pipeline to the Lower 48. Keep your fingers crossed, that politics don’t get in the way of any good project - the bullet line or the big pipeline.

INDEPENDENCE DAY 2008

Just before the Independence Day parade in Anchorage, the Channel 11 TV reporter asked me what made the 4th of July celebration so special. A simple question, but the answer is difficult to put into words. Obviously, Independence Day is our nation’s birthday. But so what?

Well, I feel Blessed to have been born in the United States of America. I wasn’t born in America through anything I did. I want to deserve the privilege of being an American.

There’s no nation in the world that enjoys both the substance and the spirit of our country. No one is trying to escape America - but seemingly half the world would like to immigrate here. There has to be a reason for that. Our problems, real and imagined, are infinitesimal compared to many other nations. Perhaps the words to “God Bless America” express best express what makes Independence Day so special. I wish I had thought to tell the TV reporter that.

This is my sixth time in the Anchorage Independence Day Parade. I’m there as a member of the legislature’s Joint Armed Services Committee, as a Vietnam veteran, and an Air Force retiree. I love a parade, and this parade best of all. This year I my daughter Mary – a surgical nurse at Alaska Regional Hospital - rode with me in the parade car.

TO THE TOP OF THE CONTINENT

Our Alaska Legislature traveled to Barrow to continue hearings on critical gas pipeline proposals. Barrow is 320 miles north of the Arctic Circle, where the sun never sets or shines for 82 days. Have a “bad day” or “bad night” night in this community of some 4700 folks, and it’ll last 82 consecutive times! The majority of residents in this remarkable town are Inupiat Eskimos, and a great number of them hunt the mighty whale for subsistence - as they have for centuries.

For thirty years the North Slope Borough, where Barrow is located, has produced the oil that is the basis for ninety percent of Alaska’s revenue. And our Permanent Fund Dividend check, I might add. And now this same borough is on the verge of producing natural gas – and more state riches – that will someday (I hope) travel down a gas to market. Mayor Itta of the North Star Borough welcomed us to Barrow, and endorsed the TC Alaska pipeline proposal. I was very happy that Governor Sarah Palin also traveled to Barrow for the occasion.

Yes, it was an expensive trip for our legislature to meet in Barrow. It was worth it. As Representative Reggie Joule (an Eskimo from Kotzebue) put it, “Yes it's expensive. But sometimes ignorance is more expensive than knowing something about the people in our state. We need to see are both ends of the spectrum.” He added, "We need to see where the resource comes from, but we also have a responsible to go to those places that aren't as fortunate, where they need different kinds of resources and different kinds of help." Most of the legislators were housed at the Ilisagvik College dormitory. There was no shortage of comment on the proposed TC Alaska gas pipeline. Likewise, there was also no shortage of opposition to any offshore drilling that could harm the whaling industry that’s more essential to the Barrow economy and culture than I realized. It’s one thing to read about it in a book, but nothing beats seeing it “in the real.”

The hearings in Barrow coincided with the Nalukataq Whaling Festival that gave me better insight to the Inupiat way of life. During the Nalukataq, the “Gift of the Whale” was distributed to both Barrow residents and guests in the form of whale meat (“guaq”) and “muktuk.” I’m an omnivorous representative, so of course I sampled both. No one needs to worry about competing with me for the muktuk, but the guaq – slices of frozen red whale meat – had a wonderful flavor.The Nalukataq also included the famed Eskimo blanket toss, but in this case I decided discretion was the better part of valor, and declined participation. Another highlight of the Barrow was driving a four-wheeler trip about eight miles northeast of Barrow to Point Barrow, the actual top of the entire American continent. Archeological excavations and pre-historic research is taking place there (but no one bothered me).