By DIMITRA LAVRAKAS
With rumors of an Enron-like scandal at Alaska Power & Telephone, company officials are trying to reassure employees and customers that job cuts will not be deep, the lights will stay on and the phones will work.
Were a little bit upside down now, said President Bob Grimm from the Port Townsend, Wash. headquarters. ...AP&T has been in the business of providing services in Skagway since 1957. Were lucky to have knowledgeable and capable people who live in the community working for us. The lights will be on.
The problem, said Executive Vice President Stan Selmer, is that the companys debt to equity ratio is off.
There was $23 million for Goat Lake, $16 million for the GTE loan, $7 million for Black Bear Hydro on Prince of Wales thats $46 million in bond debt, Selmer said.
The Securities and Exchange Commission requires a 30 percent equity to 70 percent debt, so the company has a plan to right that beginning January.
It took an audit to find out how far out of compliance we were, said Selmer.
AP&T expanded in many directions over the last few years, too many say some former employees and current stockholders who described it as Enron of the North but did not want to be quoted.
In April 2001, the company bought 40 percent ownership of an Anchorage construction company, Summit Alaska, and invested money in Summits gravel pit operation, Alaska Rock.
At the time, now-resigned AP&T Chief Financial Officer Howard Garner, told the Alaska Journal of Commerce, As a public utility we want to keep it very separate. We look at this as an investment...For us this represents an investment opportunity that complements our long-term business plan in construction.
Alan See, formerly of Skagway, was made president and chief executive of Summit, but he is no longer with AP&T or Summit, having resigned from his job, but is still on the board of directors. He could not be reached for comment as his phone is unlisted in Washington.
Grimm said he expects AP&Ts stock to dip further until the financial situation is corrected. Employees retirement funds are in a separate trust, he said, and are safe.
According to the NASDAQ Web site (see graphic below), AP&T stock has dropped from $24 a share in August to $10 last week.
Asked about an off-shore account in the Cayman Islands, Selmer said the money in that account is from the Pasa Bien hydro project in Guatemala.
So why would we want to devalue our money 64 percent, when we have our own project and employees in Guatemala, said Selmer, referring to the corporate tax the company would have to pay if it transferred the money to the U.S.
I feel confident that the plans were making which includes the sale of new equity in the company is what is necessary to fix AP&T, Selmer said.
Company shareholders authorized the sale of new equity (stocks) at the September meeting, Selmer said, but the process of and the schedule for selling new shares has not been established at this time.
This week, Alaska Telephone Co., AP&Ts telephone subsidiary, filed for a rate increase with the Regulatory Commission of Alaska an increase of 17.08 percent. The residential line charge would increase from $13.80 per month to $16.60, the commercial, $18.90 to $22.13. The stated reason in the application is a revenue deficiency of $488,038.
What this means, ATCs President Mike Garrett said, is that the commission required the company to file a change of depreciation rates. Garrett said the filing has nothing to do with the companys financial situation.
There have been significant changes in the telecommunications environment, Garrett said. This doesnt mean the commission will accept our rates.
Its a multi-step process, we wont even have a hearing until July of 2003, he said.
Meanwhile, customers will receive with their bills, notice of the filing and the hearing schedule.
In related news, Selmer said the Otter Creek Hydro Project was issued its license permit from the Federal Energy Regulatory Commission Oct. 13.
Were still in the running to get the $5 million in federal funds slated for construction, Selmer said. Well know about the funding issue before the end of the year.
By the way, he said, the name of the project will be officially changed to the Kasidaya Creek Hydro Project.
Reception attendees got to see a video of Fran Ulmer and later talked to her via teleconference. -DL
Candidates agree with Skagwayans
They support borough effort, no Juneau road
By DIMITRA LAVRAKAS
The weather whipped them all, well, almost all. Only Gary Graham, District 5 Republican candidate for state representative made it through our weeks-long foggy skies. He was in Haines and it was actually clear enough to fly. If he had been in Juneau, hed have been a no-show.
Voters arriving at candidate receptions saw nothing but campaign literature, whistles and key chains, plates of cookies and brewing coffee but no candidates.
Frank Murkowski and Loren Leman, Fran Ulmer, Albert Kookesh and Georgianna Lincoln all made dates, all had to cancel.
But what the Skagway News could gather from contacting state representative and senatorial candidates, they unanimously agree that if Skagway doesnt want a road, it shouldnt have to have one.
Im not there to dictate what any community wants or doesnt want in the community, said Sen. Georgianna Lincoln. If thats not something the community wants, then I am not going to support that and will do all I can to prevent that from happening.
Rep. Albert Kookesh was more to the point No, was all he said when asked if he supported a road.
House candidate Gary Graham, left, talks issues with Paul Taylor at the WP&YR depot. DL
Graham, a Cordova city councilmember, said it was one place where he and Murkowski parted ways. Murkowski has said he favors completing the roads Environmental Impact Statement. Ulmer has also supported continuing the EIS process. Graham is running against Kookesh.
Ive been fighting a road in for 24 years in Cordova, he said. Thats where Frank and I disagree. If the people of Skagway and Haines dont want a road, then the people of Skagway and Haines shouldnt have it shoved down their throat.
Mac Carter, Republican candidate for state senator from Central running against Lincoln, e-mailed: Personally, I believe the decision should be left up to the people of that area and the Juneau area. Not the Legislature!
As for the other important issue facing Skagway borough incorporation, candidates unanimously said they would support Skagways efforts to form a borough.
Sure, said Kookesh, who pointed out the intent of the original language was to get as many cities to incorporate as possible, but that has not happened.
Lincoln said she has worked with Sen. Carl Morgan (Aniak) to hold the mandatory borough bill in his committee to prevent it from going forward.
I have been adamantly opposed to mandatory boroughs, and have fought that tooth and nails, Lincoln said. ...I represent communities with a dozen people up to the thousands, and one size doesnt fit all. What is a model in Alaska? Every area is so different, nothing just fits into a model.
I dont see whats wrong with a single-city borough, Graham said.
I can tell you how we in Central feel, we want our own borough and dont want to be included in someone elses! So the answer is yes.
A coho salmon makes a break up the falls at Liarsvilles Gold Rush Trail Camp. A larger than normal silver run is happening all over Southeast, say Alaska Department of Fish and Game staff. See story below. - Dimitra Lavrakas
Natural silver run a screamer this year
Fish and Game says its the same all over Southeast
By DIMITRA LAVRAKAS
Theyre lined up like Boeings at Kennedy Airport. A natural silver run, the biggest in recent memory, is screaming up the Skagway River and into the creek that runs through Liarsville.
At the Gold Rush Trail Camp, they come to a 45-degree waterfall, where they hurl themselves up the boiling water only to be washed back down. Its kind of a sad thing to watch, but then its an indication theres still a strong, natural silver run. Its something seen in old photos of gold rushers fishing in the river, holding up some big fish. These are some whoppers too, along with the odd Dolly Varden looking for a free meal of fish eggs.
The creek that is known by many names, said resident Stan Selmer, can be called Lillegraven, Sanitarium, Atchinson, or Liarsville its your pick, he said.
When I was a kid it was the same way, you could walk on the backs of them, Selmer said.
Selmer said Bert Bounds, who lives along the creek, had asked for a valve to be added to the dike so he could control the flow of water when the fish are running.
What happens now, is the fish die in the river when the water isnt high enough for them to get in, Selmer said.
Bounds was out of town and couldnt be reached for comment.
Ben Kirkpatrick with ADF&Gs Habitat Division said the Lillegraven run depends on where the main channel of the river is and whether its anywhere near the entrance to the stream, not if the water is high enough to pass into the creek.
Jerry Myers Fish Hatchery Manager Rex Kilburn said there had been an attempt to catch some silvers and strip eggs in Pullen Creek, but the ones captured had already spawned or were males.
Randy Ericksen, fisheries biologist with the Alaska Department of Fish and Game Sportfish Division in Haines, said its happening all over Southeast. With the low coho prices this year, commercial fishing has been light, and coupling that with the large run of coho smolt observed last year, makes it one of the biggest returns, he said.
So, get your fishing pole out, there are no restricted areas, Ericksen said, except on Pullen Creek above Second Avenue.
OTHER STORIES OF NOTE
Belisle, Carlson vie for open school board seat
The Skagway School District received two letters of interest from residents for the open board seat by the Oct. 22 deadline. Darren Belisle and Bob Carlson were interviewed by board members and the public at a special School Board meeting on Thursday evening after this issue went to press. It was the first use of a new board policy requiring public participation in the process.
The board will make its selection at its regular meeting on Oct. 29. The seat became vacant Oct. 9 with the resignation of Tom Cochran for personal reasons. JB
Development corporation awarded grant
The U.S. Department of Agriculture Rural Development Office in Palmer notified the Skagway Development Corporation Oct. 18 that the SDC has been awarded a $118,600 Rural Business Development Grant, according to a SDC press release.
The SDC is a private, non-profit economic planning and development organization founded earlier this year.
The corporation applied for the grant in June, according to Stuart Brown, SDC president. The application was scored and ranked at the regional office in Palmer, and then sent to Washington D.C. for national funding competition.
The grant funds will be used for the SDCs Revolving Loan Fund Program, Brown said, which is aimed at providing low interest loans to start-up businesses and expanding existing small businesses in Skagway.
Generally, these are folks who have been turned down by the bank for one reason or another, usually not related to credit problems, the release said. As the loans are paid back, the funds are loaned again to other small businesses. Participants of the program will be assisted in writing a business plan, take part in a mentorship program, and undergo a review process and monitoring throughout the course of their loan.
Two local businesses were included in the original application, with additional funds included to be loaned out to more businesses. Brown added that anyone in the Skagway area who is interested in the revolving loan program and is considering starting a new business or expanding their existing business is encouraged to contact him or one of the other SDC board members Lorraine Cook, Curt Dodd, Lynn Herbig or Janilyn Heger to learn more about the program and the application process.
Other grants being researched or applied for include funding for the Rec. Center swimming pool, the rifle range relocation project, childcare center development, a business incubator, and a learning center/boarding school/vocational-tech center proposal.- DL
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