Kerttula: It’s time to get critical

House Minority leader speaks out on ACMP failure, in-state gas line report, oil tax legislation and future OCS development

By Steve Quinn

For Petroleum News

House Minority Leader Beth Kerttula isn’t mincing words.

She’s angry at the loss of the State of Alaska’s coastal management program.

She’s skeptical at a pending report that examines the prospects of an in-state gas line.

And she’s not budging on the prospects of a tax reduction for oil companies unless someone offers compelling evidence that something needs to be done.

After the Legislature’s unsuccessful final attempt at saving the Alaska Coastal Management Program, the Juneau Democrat sat down with Petroleum News to discuss various resource development issues.

Petroleum News: What is lost by not having a coastal zone program?

Kerttula: We lose so much.

We have more interaction with federal permitting for federal lands and federal waters than any other state. I’d actually make a bet on that. With coastal zone management, the federal activity and federal permits must be consistent with the state-approved plan. I like to think of it as a grant of sovereignty from the federal government back to the state. We have a federally approved plan and that means the federal government must meet with the state’s plan. That’s a very powerful tool. Larry Hartig, the commissioner of DEC, testified twice about how important that is, particularly in the Arctic, particularly on oil spill contingency plans. Our plans require more. The state has been a leader in terms of protecting our waters and lands from oil spills. That’s important to him. That’s important to the state. That will no longer apply. Now the federal government has control. We will have a right to comment, but the federal government can say, “Yeah that’s very nice, but we’ll use our own laws, which are not as stringent as yours.” We lose state sovereignty. We lose the right to require certain things.

Kerttula: We lose the right to encourage development. What happens in reality is the state and feds have to sit down. They have to listen to us. They have to be consistent with our plan. That aids development because Alaskans with local knowledge know more than many of the federal permitters. We can work things out with developers to make things work. That’s lost now.

Now we are going to slow down development. We’ll slow it down in a bunch of ways. Let’s say I want to build a dock behind my house. I have to get a bunch of different permits. I need DEC, DNR, Fish & Game, Corps of Engineers, probably EPA. The coastal zone management program with its coastal zone questionnaire handles the coordinating for all of those agencies with all of those permits. That won’t happen anymore. I will have to run around to all those different agencies. It’s going to be a nightmare.

Marilyn Crockett, of AOGA, testified and said it probably won’t be such a problem for the big companies. She’s right. They are used to it.

But smaller companies, the mom and pops, or myself as someone who wants to build a dock, are going to have one heck of at time.

Third, there is a loss of jobs, loss of communication across the state. Not only the 33 (staffers) who worked with the program, but also the people in the coastal districts: all gone. People who were really committed.

This was the kind of program that really captures the imagination of the people who work in it. They put their hearts and souls in it and they just got trashed through a series of disingenuous, very political, moves. That makes me really angry. Twenty-two jobs lost in Juneau.

Yeah, many of them found jobs, but they were not helped by the administration. I want to point that out. They act like they helped those people. That isn’t true. Many are getting paid less.

Kerttula: It’s obvious to me that the Parnell administration was against this program from the beginning. I should have known that because some of the people who work in the administration were not trying to help this program be successful. For the administration to dismantle the program before it was actually out of existence… it was a fait accompli by the time we were able to act. They are disregarding permits and telling people not to apply. The law was in effect. I don’t know how they justified that. They ignored the law, it seems, rather than come to the Legislature or try to do anything to make things work.

There were many ways to make it work. One way would have been bringing experts from other agencies, hire a contractor or two, hiring people who wanted to come back to the program. I can tell you how to do it. Many people can tell you how to do it. For them to come in and say it’s too late, it’s done for. The Legislature violated its own separation of powers by not saying, that’s actually a problem for us. We want this program, we are giving you the money for it, but you are dismantling it. There is a real abuse of power. (See Petroleum News story on coastal zone management on page 17 for Gov. Sean Parnell’s response).

Petroleum News: So where do you go from here?

Kerttula: We need to go out in the communities, go out into the coastal districts and find the managers who stuck it out with the program. Then sit them down and ask, “How do you rebuild this program into a healthy program, to one that really works for communities and the state?” You need to get people who have historic knowledge of the program from the beginning as well as some of the new people involved. You need to take a good hard look at what’s coming — the marine spatial planning and fisheries management issues — and build it into a holistic program. You need to involve industry to find out what’s working with permitting and what isn’t. You need to have a critical eye: who is doing real stuff and who is doing something for their own motives.

I think the Legislature will do something like the Northern Waters Task Force, the DEC and DNR need to do this, set up some kind of joint effort to do it.

I’m not going to quit talking about it. People in the coastal districts are not going to quit talking about it.

We really are the ocean state of the nation and people need to recognize that.

There is a part of me that recognizes that this program was on its last legs. The administration was never, never going to let it live. Out of that there is going to come an opportunity to build a stronger program.

Kerttula: I don’t know all of the conversations and who backed out on whom or what happened, but I still felt a total lack of leadership. The Senate was able to focus to do its job. The House fell apart. I’m really proud of the minority in the House. My caucus has been there on this issue every single time. The Senate fought as hard as it could to get its majority to do the right thing. The governor and the House Majority continue to try to turn the spin around as if the Senate is the bad guy and we don’t play a part. There is a lack of leadership. The governor lacked leadership. The House Majority, it was very disingenuous to say, “Oh this is a great policy but it’s been dismantled so we can’t do anything.” As a Legislature, that’s just not living up to what I think our founders had in mind with separation of powers. You don’t cave in. You don’t just say the executive (branch) said this, so we can’t do anything.

Petroleum News: What about the OCS, are you confident about the prospects moving forward?

Kerttula: There will be less direct communication with communities. Rep. (Reggie) Joule, in his own inimitable way, said it best: Now the game is going to be with the federal government. I think it will now be more difficult. With the loss of the state’s power, I think it will get harder. It will stymie the development somewhat and that’s a shame. We need to be figuring out the issues rather than stopping them. I think that’s the attitude of the North Slope Borough. The North Slope Borough has always wanted to be a partner. Mayor (Edward) Itta has always said that.

Kerttula: The bill that was on the floor clearly stated that at any kind of pressure point, the state won. That was a little bit of a problem for some of us, but we were willing to compromise. If the local community is correct about an issue, why would the state always win? That’s why it’s perplexing to see the whole thing go down like that.

Petroleum News: Onto a different subject, the report on an in-state gas pipeline will come out (July 5). What will you look for in that report?

Kerttula: I’m going to look at how independent the report is. … I’m going to be skeptical and looking at it hard to see what’s the real information versus what’s the information that resulted from political pressure.

Petroleum News: Is it not worth considering?

Kerttula: Let’s put it this way, I’d feel better if we had a completely independent entity doing it. I want to see it. I think information on any gas line in Alaska is important. Having said that, it may be very valuable information, it may not be. I’m going to be looking first at how independent it was, where they got the information from and who controlled the information. That’s what’s going to be important to me first. All Alaskans should look at it very critically. I’m sorry to have to say that, but I’m becoming more critical in my old age.

Kerttula: I’m confident they are moving forward, but it’s hard because we don’t get as much information as everyone would like and that is a problem. On the other hand (federal pipeline coordinator) Larry Persily is working diligently getting information out.

Petroleum News: Next year, oil tax will be one of the heaviest items on your plate. What do you see happening there?

Kerttula: The fact that we are willing to risk our financial future and accept anything but the best information, the most independent information, about what we should be doing, would be wrong. I got dragged to a profits tax. I am not going to move off of it unless I understand what’s going to happen in the future and what the smart thing to do is for the state. We have a responsibility. We have a corporate state in my opinion. We need to stand up and be just as strong as the oil companies. It’s our future.

Petroleum News: There does seem to be a strong interest in re-examining the progressivity portion of the tax.

Kerttula: I’m happy to do that, but I have an innate problem with listening to companies who are making world-record profits complain that the progressivity is too high when they continue to gain such huge amounts. Alaskans need to benefit right along with them. At high prices we need to benefit more. There are a lot of crocodile tears and a lot of posturing. The facts have proven they are not doing poorly in Alaska. That’s what we are going to have to base this on — the facts. I’m not going to move until it’s proven that it’s necessary.