If We Owned AIDEA For One Day
By Jim Crawford

If we owned the Alaska Industrial Development and Export Authority (AIDEA) for just one day, what could we do?

On Monday, with AIDEA’s top-notch staff, we would finance the Alaska Gasline. I’d call the boys at my old stomping grounds, J P Morgan/Chase. I worked with J P Morgan when they began the commercial mortgage backed securities business.

I originated Alaskan commercial deals with them and with other national markets that were looking for good commercial and apartment loans. Rating agencies gave points for geographic diversity in securities so Alaska loans were welcomed in the first commercial mortgage backs.

AIDEA has authority to finance commercial projects. Financing the gasline is straightforward for a commercial lender since its federally guaranteed. That is the kind of financing we should love at AIDEA. The feds take all the risk and drive the rate to the floor. When we close, we can tell TransCanada Alaska, Exxon, BP and Conoco Phillips that we have the money in the bank, ready to begin construction when FERC issues permits.

The precedent is set for AIDEA financing. In Valdez many years ago, I chaired the Valdez Port Commission. As one of the town’s bankers, we each got to serve in these lofty positions which paid nary a dime. I was also the President of the Valdez Chamber of Commerce. We financed the Alyeska Pipeline terminal for $3.2 billion, tax-exempt bonds. Folks said we couldn’t, but we did.

AIDEA has authority to invest equity in commercial projects. We could nicely ask the producers for equity commitments or AIDEA can provide the equity. The gas has to go down the pipe when it’s built. If leaseholders refuse to sell, they become ex-leaseholders. That is a secure equity position for Alaska.

Growing up in Anchorage, we used to annually visit Seward where my Dad was born. We got to see Herman and Winnie Leir. I loved them. Herman was the funniest guy and Winnie made super pies.

Herman had a D8 cat and got a bit impatient with the debate about building a road to Exit Glacier and Harding Ice Fields. Like the gasline, the debate dragged on for decades. One summer night when I was in my twenties, Herman hopped on his D8 and began clearing the road. I was working for U. S. Ted Stevens. Herman called and said, “Tell Ted, the feds want to cart me off to jail for trespassing.” He cut through five miles of road before they got him off the D8. The Feds were armed and royally ticked. Herman did not go to jail and the Senator got the money to complete the road. The road that Herman built now serves thousands of tourists.

If AIDEA, on our one day of ownership, finances 80% of the gasline and accoutrements and provides equity as needed, the staff should get a Christmas bonus for kick starting our economy. After all, that is the job we expect to be done by the lead development agency in Alaska.

After our one action day, we could apply for another day. Tuesday, we could design-build the UAA Sports facility, a new capitol building in Juneau and an expansion research building for UAF. Wednesday, we could retrofit solar energy power panels on all state owned schools and buildings in Alaska. Thursday, we could finance new hydroelectric projects. Friday and Saturday, we could finance the acquisition and renovation of beat up apartments throughout Alaska since AHFC refuses to do it. On Sunday, we would rest from our work and praise the Lord.

AIDEA has the money, the lending and equity programs and the staff to make each of these projects happen. As the owner state, we do own AIDEA. I guess we just need to supply a little more will power.