Keeping Alaska Open for Business: Options for the State of Alaska

In News by wp_sysadmin

As the private sector in Alaska continues to navigate damage done to their livelihoods by COVID-19 and the crash of the global oil market, it is important that the State of Alaska take action to provide support for businesses until they can get back to work. 

Much attention has been focused on financial aid. That aid has been critical for many in the private sector in Alaska, however, it is temporary relief that will not provide the long-term support most of the private sector will need.

Not all aid is financial. The State of Alaska can provide relief via emergency regulations that can be put in place for the duration of the economic crisis. 

An example: Several weeks ago we wrote here about the DOT and actions they were taking that were harmful to Alaska businesses in the oil and gas support industry. Since that time, DOT has reversed their practices and agreed to allow late payments on leases without penalties or interest and they have suspended the lease rate increases for 2019. We are grateful to DOT for these actions. 

This is, however, temporary and minor relief to a long-term problem. DOT has the authority, under AS 44.62.250  to establish an emergency regulation that repeals the existing structure and replaces it with lower fees that remain in effect for 24 months or until an appraisal reflecting post- COVID-19 market conditions is completed and regulations establishing new rental rates have been adopted by the department.

Such emergency regulations take effect without the notice and comment period that is otherwise required. DOT should have no problem finding that “relief is required for immediate preservation of public peace, health, safety, or general welfare.”   The emergency regulations would be effective for 120 days but can become permanent if public notice and comment is conducted within the 120-day period.  The precedent has already been set; the Alaska Industrial Development & Export Authority has issued such emergency regulations already.

These are just a few examples of creative problem solving that will help ease the burden on Alaskan businesses without asking for a handout.  Using emergency regulations to provide support to Alaska’s private sector during an economic crisis is an appropriate and quick remedy that can be a strong foundation for businesses to weather the storm.  We hope the state agrees and does everything they can to keep Alaska open for business.