Former Alaska U.S. Senator Mike Gravel was in Alaska recently for a couple of speeches and a round of visiting friends and former staff.
In Alaska, Gravel is best remembered for his nervy move in 1973 to exempt the trans-Alaska oil pipeline from a tangle of environmental lawsuits, a move that brought the young senator a huge amount of criticism for violating Senate protocol, like not kowtowing to Interior Committee Chairman Sen. Scoop Jackson.
Gravel ultimately prevailed with his amendment by a nail-biting one-vote margin in a Senate deadlocked 50-50, with Vice President Spiro Agnew casted the deciding vote.
The amendment was typical Gravel, an unorthodox move that affirmed his maverick reputation. Today we think of it as brilliant, but that's because it worked -- narrowly.
While he was here, Alyeska Pipeline Service Co. invited the senator to meet with its employees to tell the story. Many older Alyeska workers knew it well, but many younger ones did not.
It's quite possible that had the amendment failed, the environmental litigants would have ultimately won, grinding the project down in delays, lawsuits and controversy until the Alaska National Interest Lands and Conservation Act came before Congress a few years later. Had that happened, I believe Prudhoe Bay might be part of the Arctic National Wildlife Refuge today.
I learned some things about Gravel's time in office while he was here, mainly from his former staff. One thing is that Gravel enabled our Alaska Marine Highway System to become eligible for federal transportation funds, which was and is a big deal. It also helped Washington state's ferry system.
Gravel was controversial, no doubt. His critics called him a hip-shooter, but supporters said he had vision and tended to act quickly on his intuition.
I think one of Gravel's most interesting ideas was his notion of all Alaskans owning part of the Trans-Alaska Pipeline System and sharing in dividends from pipeline profits.
The senator advanced this idea in the late 1970s and succeeded in getting a federal income tax exemption that granted tax-exempt status for dividend income earned by Alaskans.
This idea seemed outlandish, even socialistic, at the time (this was before the Permanent Fund dividend) and Alaskans rejected it.
Fast-forward 36 years and today we have the state of Alaska as a 25-percent partner in the big Alaska LNG project and a requirement in the state enabling legislation, Senate Bill 138, for a plan for individual Alaskans to be able to own shares in the state's one-fourth of the big gas project.
Back to 1979: It wasn't widely known then, but a centerpiece of Gravel's plan was that BP, one of the TAPS owners, was willing to sell its share of the pipeline to either the state or a citizen-owned pipeline entity. I know that because in those days I worked for BP and I was the messenger conveying the company's willingness to sell to the state.
Gravel told me on his trip here that BP had assured him of its willingness to sell to its TAPS share to the citizen corporation too.
Gov. Jay Hammond turned down BP on its offer to the state. Hammond was also cool to Gravel's idea. Some think that because he feared it would complicate the idea for the Permanent Fund dividend, but Gravel didn't think the two competed with each other. The two plans were fundamentally different, and could easily exist side-by-side. One advantage Gravel's idea had, however, was the exemption for dividend income from federal income tax, which is not available to PFD recipients.
However, one other advantage of Gravel's plan is that the acquisition of shares in the pipeline could be a one-time event to the Alaskan generation of 1980. Alaskans arriving later would not get shares, although the pipeline company could always authorize additional shares.
Hammond was unsuccessful in obtaining this favoring of long-time Alaskans for the PFD. It was first enacted that way but was successfully challenged in court, which is why the dividend goes to all Alaska residents today regardless of length of residence.
The interesting thing now is that it is still possible to accomplish the senator's goal of citizen ownership by allowing Alaskans to hold shares in the state gas pipeline corporation.
Sadly, the federal tax exemption is no longer available (the authority expired) but partial state ownership of the project is a reality and a legislative intent for partial ownership of that by citizens is in SB 138, the enabling legislation.
The heavy lifting on this has been done. The rest is details.
Tim Bradner is coeditor of Alaska Inc., a quarterly business magazine that focuses on Alaska Native corporations, and co-publisher of Bradner's Alaska Legislative Digest. He writes a regular column for Alaska Dispatch News.
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