Anchorage Port Plan: Politics and Pork

By Myrl Thompson

If an Alaska politician ever needed a playbook on how not to do business as usual, they should look no further than the current Port of Anchorage expansion fiasco as a template. The ongoing port expansion has all the hallmarks of the "good old boy" politics that has afflicted Alaska projects for all too long. This particular project has enough red flags to stop a speeding train. Considering the plentiful recent mistakes by Alaska politicians, one would have to wonder, what are they thinking?

Here is a project steeped in special interests, streamlined to the point of cutting corners, rife with cronyism, funded by earmarks and financial shell games and peppered with campaign donations. The proponents of this scheme are probably praying that nobody is closely watching this process unfold.

Letter to Mayor Begich and Trustees For Alaska Letter (PDF)

Engineers urged to revoke permit for port project (ADN.com 4/3/08)

Does Alaska need a $700 million port? (ADN.com 3/23/08)

There is little doubt about the basic need for the upgrade and expansion to the Port of Anchorage, which started operations back in 1961. Upgrade talk began in earnest when former Anchorage Mayor George Wuerch put former governor Bill Sheffield in charge of the port expansion. In fact, soon after Sheffield was appointed Port Director in 2001, the engineering firm Tryck Nyman Hayes submitted a preliminary design for port upgrades based on a selected design alternative chosen by port officials, with an estimated cost of $225 million dollars.

The original expansion idea had been in the works since 1999. However, Sheffield had different plans. Port Engineer Richard Burg lost his job because of a dispute with Sheffield over his plans to scrap the Tryck Nyman Hayes design for a much larger and supposedly less expensive mega-project based on a new design by Peratrovich, Nottingham & Drage Inc. (PND Engineers Inc.)

Previously, Sheffield had awarded PND Inc. a $30,000 sum for a new study for the Port of Anchorage, without competitive bidding beforehand. In March 2002, Sheffield unveiled the new PND plan that allegedly would cost only $146 million for a larger project. Sheffield touted the plan as, "millions cheaper" than the Tryck Nyman Hayes plan. This new PND plan was based on a patent owned by PND.

In the years since PND Inc has been awarded the contract, the costs have soared to more than $700 million dollars for the Port of Anchorage. That "millions cheaper" statement by Sheffield is actually many millions more expensive.

Is there more here than meets the eye?

Early on in the port expansion, Sheffield and PND President Dennis Nottingham were giving campaign donations to the right people. From 1999-2002, Nottingham and his wife donated thousands of dollars to Republicans Wuerch, Gov. Frank Murkowski, Lt. Gov. Loren Leman, state Sen. Dave Donley and the Republican Party of Alaska. During that same time, Bill Sheffield was donating thousands more to the coffers of Wuerch, Murkowski, Leman, Donley, state Sen. Ben Stevens and Anchorage Mayor Mark Begich.

To be fair, politicians are quick to point out the lack of correlation between campaign contributions and policy decisions. Large donations, they say, have nothing to do with the earmarks back to those who donate. That may or may not be the case.

After PDN Inc. got the port contract and the costs escalated dramatically, the money trail shifted from local politicians to the congressional delegation. Donations from Dennis Nottingham and Bill Sheffield to the Alaska delegation surpass $20,000 dollars from 2002 onward. The campaign cash is distributed between Stevens, Young, Lisa Murkowski and the Northern Lights PAC. The Northern Lights PAC is affiliated with Ted Stevens and lists many political heavy-hitters among its ranks, including Bill Allen, Don Rumsfeld and Bill Sheffield, to name a few.

No special-interest mega-project would be complete without corner-cutting. The port project is no exception.

Because this project is to be funded in part by the federal government, a number of agencies have to be involved. The U.S. Department of Transportation's Maritime Administration (MARAD) is the overall project manager. MARAD made a "finding of no significant impact" under the National Environmental Policy Act (NEPA). Concerns ranged from violations of the Clean Water Act to various biological interests dealing with salmon, beluga whales and valuable estuary loss. MARAD rejected calls from Cook Inlet Keeper, the U.S. Fish and Wildlife Service, the Environmental Protection Agency, the National Ocean and Atmospheric Administration and the National Marine Fisheries Service to issue an Environmental Impact Statement (EIS). MARAD rejected the request and the need for an EIS and issued its "finding of no significant impact."

MARAD has never overseen a port expansion before. However, by doing so they open the door for federal earmarks and Alaska Native corporation 8(a) hiring of Dennis Nottingham's firm. This special-interest streamlining and other corner-cutting measures has caused a Request for Correction of Information to be submitted to the Army Corps of Engineers, under the Federal Information Quality Act. The request was made because of serious concerns with the quality of the data used to support the port expansion.

The Port of Anchorage expansion is complicated and complex. It involves all that is wrong with Alaska politics. Old-guard players using business-as-usual methods are alive and well in Alaska.

Sheffield is heading up the questionable mega-project port expansion. Wuerch is working the Knik Arm Crossing. John Shively is working for the Pebble Mine project. Murkowski tried to re-insert himself on the gasline project. The same Alaska delegation is still in power.

Expect more of the same old cronyism, special-interest pandering and skirting of the rules. Be ready for an attack on campaign finance reform and weak and watered-down ethics legislation. These reforms are seen as a threat to old guard politics, which are currently alive and well.

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Myrl Thompson is a veteran Capitol watcher, former candidate for state House, and award-winning free-lance journalist based in Wasilla, Alaska.

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