Legislature(2015 - 2016)BUTROVICH 205
03/26/2015 11:15 AM Senate SPECIAL CMTE ON THE ARCTIC
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| Audio | Topic |
|---|---|
| Start | |
| Presentations: Arctic Business Opportunities and Developments and Port of Adak | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
ALASKA STATE LEGISLATURE
SENATE SPECIAL COMMITTEE ON THE ARCTIC
March 26, 2015
11:18 a.m.
MEMBERS PRESENT
Senator Lesil McGuire, Co-Chair
Senator Lyman Hoffman
Senator Gary Stevens
Senator Donald Olson
Senator John Coghill
MEMBERS ABSENT
Senator Cathy Giessel, Co-Chair
Senator Click Bishop
COMMITTEE CALENDAR
PRESENTATIONS: ARCTIC BUSINESS OPPORTUNITIES AND DEVELOPMENTS
AND PORT OF ADAK
- HEARD
PREVIOUS COMMITTEE ACTION
No previous action to record
WITNESS REGISTER
GREG WOLF, Executive Director
World Trade Center Alaska (WTCA)
Anchorage, Alaska
POSITION STATEMENT: Presented "Arctic Business Opportunities and
Developments."
THOMAS MACK, President
Aleut Corporation
Anchorage, Alaska
POSITION STATEMENT: Presented "The Port of Adak."
LAYTON LOCKETTE, City Manager
Adak, Alaska
POSITION STATEMENT: Presented information about the Port of
Adak.
ACTION NARRATIVE
11:18:56 AM
CO-CHAIR LESIL MCGUIRE called the Senate Special Committee on
the Arctic meeting to order at 11:18 a.m. Present at the call to
order were Senators Hoffman, Stevens, Olson, Coghill, and Co-
Chair McGuire.
^PRESENTATIONS: Arctic Business Opportunities and Developments
and Port of Adak
PRESENTATIONS: Arctic Business Opportunities and Developments
and Port of Adak
11:19:48 AM
CO-CHAIR MCGUIRE announced the presentation on Arctic Business
Opportunities and Developments.
GREG WOLF, Executive Director, World Trade Center Alaska (WTCA),
presented "Arctic Business Opportunities and Developments." He
noted it was his 17th year talking about WTCA. He said Alaska is
facing a financial crisis and he used Chinese characters to say
that a crisis can also be an opportunity.
He said that China is Alaska's largest trading partner, with
trade totally $1.4 billion last year. China is followed by
Japan, South Korea, and Canada, all long-standing international
trade partners. He said for the year 2014, trade equaled $5.2
billion, the second highest on record.
MR. WOLF showed a graph of China's trade over ten years,
depicting why China is the number one customer. He opined that
the next step for China is to become an investor. He discussed
Alaska's exports to China by commodity during 2014. Half of the
exports are seafood.
He showed a graph of how trade has doubled over the past 20
years. It has gone from about $2.5 billion to $5 billion in the
Alaska economy. There were only two down years, in 1998 as a
result of the Asian economic crisis, and in 2008-2009 the Great
Recession.
CO-CHAIR MCGUIRE asked about 2009.
MR. WOLF reiterated that it was when all economies slowed.
11:24:57 AM
MR. WOLF described Alaska's top export commodities for 2014;
seafood, minerals and metals, and energy - LNG and coal. The
export of forest products has declined and fish meal is also
exported. He said he accounts for the steady growth in trade
because of the current trends, calling them the "Three Rights" -
right place, right time, and right commodities. They include
Alaska's geographic location as a neighbor to the fastest
growing populations in the world. There is economic
liberalization and modernization in large emerging markets like
China that are experiencing migration to the cities and growth
of the middle class. Also, Alaska has world-class reserves of
natural resources.
11:28:08 AM
CO-CHAIR MCGUIRE asked if China and India are both predominantly
dependent on hydrocarbons for their energy sources.
MR. WOLF said yes. Some countries are moving away from coal use
to natural gas.
SENATOR HOFFMAN asked how many years China has had the one-child
law.
MR. WOLF said it has been at least 40 years.
SENATOR HOFFMAN noted that the kids have no siblings or aunts or
uncles.
MR. WOLF termed them "little emperors."
He continued to say that natural resources are the building
blocks of natural development. They are not short term trends -
they are megatrends.
11:30:17 AM
He addressed the fourth "right" - the right direction. Alaska
and the world are heading north for access to natural resources,
transportation infrastructure, and maritime shipping
opportunities, which is flowing from the commercial development
of the Arctic.
He related the opportunities for Alaskan Companies. Resource
development, infrastructure build-out, maritime logistics and
support and trade and commerce. He provided examples of
opportunities for companies.
11:32:53 AM
He said international trade is big business for Alaska. Overseas
exports equaled $5.2 billion in 2014, which is about 10 percent
of the state's economy. It provides thousands of direct and
indirect jobs and results in a stronger, more diversified
economy.
11:34:11 AM
He explained that Alaska rates 40th among the states by the
value of exports. As a percent of GSP, Alaska ranks 14th and on
a per capita basis, Alaska ranks 4th. According to the U.S.
Department of Commerce, there are approximately 300 companies
that export from locations in Alaska. Seventy-five percent of
those are considered small or medium enterprises.
MR. WOLF described why he is optimistic. Alaska has what the
world needs and has fast-growing economics and populations in
our back yard. There are new opportunities for commercial
development of the Arctic. He listed the opportunities for
minerals and metal.
11:35:55 AM
He turned to the new business model in Alaska. There are an
increasing number of companies adopting new business models for
growth and success. With the new model there are 3 billion
potential customers possible. This new mindset creates greater
feasibility for Alaskan companies and projects.
He concluded that in a time of crisis, Alaska should rise to the
opportunities.
CO-CHAIR MCGUIRE thanked Mr. Wolf.
11:37:20 AM
CO-CHAIR MCGUIRE announced the presentation on the Port of Adak.
11:37:43 AM
At ease
11:38:12 AM
THOMAS MACK, President, Aleut Corporation, presented "The Port
of Adak." He shared information about the Aleut Corporation. He
described the Aleut Region and said that Adak is the largest
land owner.
11:40:06 AM
MR. MACK said Alaska is the connection to the Arctic. He showed
a map of the Arctic boundary as defined by the Arctic Research
and Policy Act. He said the Aleutians are the gateway to the
Arctic. He spoke of the vast amount of resources in the Arctic
and that there is massive potential. Today, Adak is positioned
to become the door to the Arctic.
11:42:53 AM
MR. MACK talked about shipping. The Port of Adak was built in
1972. He showed an aerial map of the Port of Adak and spoke of
its convenient location and great facilities. He gave examples
of shipping companies that use the Port of Adak and the time
they save. He noted that Adak is an international transshipment
hub that will save money for world trade route companies. He
described the trade possibilities and alternative energy
options.
He concluded that Alaska has to take on the leadership role. He
stressed the sense of urgency in response to opening of the
Arctic. He concluded that Adak is ready to work on opening up
the Port of Adak.
11:49:07 AM
CO-CHAIR MCGUIRE thanked Mr. Mack for his presentation. She
suggested that he contact the Alaska delegation. She hoped to
change the federal government's view of the Arctic.
SENATOR STEVENS said he was surprised that the Navy left Adak.
He asked how the Port of Adak compares to other ports.
11:51:02 AM
LAYTON LOCKETTE, City Manager, presented information about the
Port of Adak. He noted that Adak has significant assets and
showed images that highlight them. He showed how Adak has
changed since the military was there and that there is flat land
available and untold resources.
He highlighted the infrastructure that is available in Adak. He
said many resources have been utilized for government purposes.
He discussed the small boat harbor master improvement plan.
11:55:12 AM
MR. LOCKETTE described the Lake Bonnie Rose Reservoir, the water
source for the community. He said the Lake DeMarie Reservoir has
the potential for wind energy and hydroelectric power.
11:57:08 AM
MR. LOCKETTE highlighted the essential air service and the
excellent airport with military and international traffic. He
addressed telecommunications opportunities, including a fiber
optic network. He talked about the fish processing industry and
the potential medical facility and hospital. He concluded that
Adak's motto is onward and upward.
11:59:30 AM
MR. MACK said Adak is trying hard to market its community and
make it work for all of Alaska. The board just passed four
goals: for Adak to become an oil fuel service center, to become
a world-class shipment hub, to optimize fishery opportunities,
and to recognize that Adak has a unique location and
opportunities. Management is tasked to come up with strategies
to work with the city to fulfill those goals.
12:00:49 PM
CO-CHAIR MCGUIRE asked if Adak has a fuel marketing plan.
MR. LOCKETTE said he thought that the subsidiary that handles
fuel has a marketing plan. He said Adak has been asked to have a
customs office and delegation as an international airport. It is
looking into local options first before asking for state
assistance.
SENATOR HOFFMAN asked about the population and the potential for
fisheries.
MR. LOCKETTE said the base populations is about 120. There are
an extra 200 people on the island when the processing plant is
in full gear. They expect to start processing Pollock soon as
part of the Corporation Allocation for Small Boats, which will
bring in more people. Also, an explosion ordinance cleanup will
occur next month and bring in another 50 people. At any given
time there are between 200-300 people on the island.
CO-CHAIR MCGUIRE asked about free housing for shareholders.
MR. MACK said now the houses are for sale.
SENATOR OLSON asked who owns the airport.
MR. LOCKETT said state does.
MR. MACK said when the corporation came in, it transferred lands
to the city and to the state, which included the airport.
SENATOR OLSON asked what the alternative airport is.
MR. LOCKETT said it is Cold Bay.
SENATOR HOFFMAN asked what the flying time between Anchorage and
Adak.
MR. LOCKETT said 2 hours and 48 minutes.
CHAIR MCGUIRE thanked the presenters.
12:04:29 PM
There being nothing further to come before the committee, Co-
Chair McGuire adjourned the Senate Special Committee on the
Arctic at 12:04 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| Presentation- Greg Wolf, Alaska's Place in the World.pptx |
SARC 3/26/2015 11:15:00 AM |
|
| Presentation- Thomas Mack, Port of Adak.pdf |
SARC 3/26/2015 11:15:00 AM |
|
| Presentation- City of Adak.pptx |
SARC 3/26/2015 11:15:00 AM |