Democrats urge Parnell to rescind Californian's appointment to Alaska oil-tax board

Richard Mauer

The Alaska Senate's four Anchorage Democrats called on Gov. Sean Parnell to withdraw the appointment of a California resident and former oil company executive from the Alaska board that sets the value of crude-oil pipelines and other petro-property for tax purposes.

Senate Minority Leader Hollis French took to the Senate floor Monday and said he was surprised that Dennis Mendell's appointment to the State Assessment Review Board hadn't already been rescinded.

A story in the Anchorage Daily News Saturday reported that Parnell had appointed Mandell to the board despite a law that requires board and commission members to be Alaska voters. Mandell, a business consultant who worked for Arco for nearly two decades, hasn't lived in Alaska since 1995 and is registered to vote in California.

"The law should be the law," said French, following up on a letter he and the three other Democrats sent to Parnell earlier Monday. "You shouldn't appoint people who don't live in Alaska to state boards and commissions. Not only is it a bad policy, it's against the law."

A spokeswoman for Parnell said he was on a flight and unavailable.

The five-member review board is the top state agency for setting the tax value of the trans-Alaska pipeline. The state and local communities share taxing rights to the line and other oil company property, dividing up collections based on two percent of the line's value each year.

Former Anchorage Assessor Marty McGee served on the board for about six years until Parnell fired him last month. Under McGee's leadership, the board increased the value of the pipeline based on a complex formula involving its value to the oil producers that own it, and for how many years it can operate.

In 2013, the board overruled state officials who had said the pipeline was worth $7.2 billion, deciding instead that its value was $11.9 billion. This year, the state lowered its valuation to $5.6 billion, half of what the review board determined last year. The communities will likely appeal that lower number of the board.

Mandell was the second former oil company official appointed to the board by Parnell since January. The other is Bernie Washington, the chief financial officer for Alaska Public Media, who worked for Mandell at Arco. Steve Lindbeck, president and general manager of Alaska Public Media, which operates radio station KSKA and the Alaska Public Radio Network, said he was examining whether Washington's voluntary membership in the board conflicted with his job at the broadcaster, which employs journalists who cover the oil industry, taxation and the Legislature.

"We're going to examine whether there is something untoward in the situation," Lindbeck said.

French said the question involving Mandell was unambiguous.

"The relevant statute is a model of clarity," French said. "It says that a person appointed to a board or commission of state government shall be, and have been before the last general election, a registered voter in the state. Boom!"

"It doesn't take very long to think about," said French, who urged members of both parties to contact the governor.

Mandell and Washington must be confirmed by the Legislature in joint session next month after hearings in the Senate Finance Committee and House Labor and Commerce Committee. French said Parnell should spare himself and Mandell embarrassment by pulling the nomination before it gets that far.

Reach Richard Mauer at or 907-500-7388.

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