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Alaska Senate passes bill to allow Texan to sit on gas line board

Pat Forgey
By a vote of 13-7 Tuesday, the Alaska Senate passed legislation that would allow out-of-state appointees of the governor to sit on the board of the Alaska Gasline Development Corporation. istockphoto

JUNEAU -- The Alaska Legislature is moving to make legal Gov. Sean Parnell's September appointment of a Texan to the Alaska Gasline Development Corporation who has served in violation of the law since then.

But critics are saying no Texan is needed to oversee Alaska's gas pipeline efforts, and that Alaskans can and should be doing that themselves.

Parnell named Richard Rabinow of Texas, an experienced pipeline executive who has worked for Exxon Pipeline Co. and other major industry players, to the AGDC board last year.

Parnell said the Alaska Constitution requires only that his appointments to boards and commissions be U.S. Citizens, and that he doesn't have to follow a state law that requires most to be Alaska residents.

That statute makes exceptions for some boards with specialized duties not found in large numbers in Alaska. One, the Alaska Aerospace Corp., manages the Kodiak Launch Complex. The other is the Alaska Railroad. Most of Alaska's most knowledgeable residents in those fields likely already work for those corporations.

But rather than challenging the constitutionality or legality of the statute requiring Alaska residency, Parnell appears to have tried to hide Rabinow's Texas residency from the public.

Typically with board appointments, the Parnell administration press release announcing the appointment almost immediately lists the appointee's place of residence among background information. For each public member except Rabinow, that was the practice in the press release announcing their appointments. Parnell's AGDC appointment press release in September listed the Alaskan board members as being from Fairbanks, Palmer, Big Lake and Anchorage, with no information about Rabinow's residency.

Parnell spokesperson Sharon Leighow did not directly address questions about how Rabinow's residency came to be concealed and when Parnell became aware of the statute he disputes.

Parnell initially maintained that the statute didn't apply, but when legislators voiced concern about voting to confirm Rabinow in violation of the Alaska residency statute, House Bill 383 was introduced allow AGDC to have out-of-state appointments, and to backdate that permission to Rabinow's September appointment.  

On Tuesday, the state Senate passed that legislation over the objections of Democratic leader Hollis French of Anchorage.

"To me this bill is an admission of guilt," French said. "It's an admission of guilt that the governor broke the law in appointing a non-Alaskan to the (AGDC) board."

But Sen. Cathy Giessel, R-Anchorage, supported the Rabinow appointment and said the sponsors of House Bill 4 -- which in 2013 established AGDC as an independent state corporation​ -- always intended that it allow appointees who were non-Alaskan in order to get the widest possible range of expertise.

She pointed out that only a single member of the AGDC board is a non-resident, and he has a sterling resume.

"Dick Rabinow is a resident of Texas. HB 383 is not about Mr. Rabinow but about fixing an oversight in House Bill 4," she said.

She said it would clarify an "ambiguity" in the law.

House Speaker Mike Chenault, R-Nikiski, an original sponsor of House Bill 4, confirmed that it was a "technical oversight" that the bill didn't allow non-residents as was intended.

French said the governor had earlier maintained that the law didn't apply to a California petroleum industry executive whom he had attempted to appoint to the State Assessment Review Board to oversee oil industry property tax decisions, but that candidate has since withdrawn. That shows Parnell's intent to get around state law limiting appointments to Alaskans, he said.  

"He bent it, he stretched it twice this year for out-of-state oil executives," French said.

In Alaska's early days the state might have needed to rely on out-of-state residents to sit on such boards, but after decades in the oil and gas business, Alaska now has enough in-state expertise to fill its boards with locals, he said.

But Parnell got majority backing for his bill, mostly from Republicans.

Sen. Gary Stevens R-Kodiak, called the attitude that only Alaskans should serve on such boards "a little bit provincial."

Sen. Peter Micciche, R-Soldotna, said HB 383 provides a broader pool of expertise to chose from, but would likely only be used in special instances. He said legislators frequently look to outside Alaska for expertise, like the consultants who are now advising them on natural gas pipeline negotiations.

"This doesn't require us to hire from somewhere else. It allows us to hire from somewhere else," he said.

Sen. Bill Wielechowski, D-Anchorage, said that when the AGDC board is weighing factors such as costs of heating, he wants Alaskans who are paying those costs sitting in the board.

"We want important policy decisions made by Alaskans, with Alaskans in mind," he said.

The bill allowing non-Alaskans to serve on the AGDC board now requires that the governor, if he appoints a non-Alaskan to the board, to also provide a statement explaining the need for the appointment.

The Senate's passage of HB 383 Tuesday by a vote of 13-7, followed the House's earlier 27-12 passage. It now goes to the governor for signature, with prompt action likely to clear the way for Rabinow's legal appointment by the time of his scheduled Thursday confirmation before a joint session of the Legislature.

That action drew the ire of Parnell election opponent independent Bill Walker, who on Tuesday called the Rabinow appointment an affront to Alaskans.

"The fact that our governor, who has also worked as a lobbyist for ConocoPhillips, would change the law in order to have an Exxon man negotiate for Alaska is further confirmation that Parnell is not wearing the people's uniform," Walker said.

Democratic candidate Byron Mallott has also disputed the appointment, saying there are qualified Alaskans who could have been appointed.  

AGDC has been funded with $400 million in state money with which to begin work on a small-diameter natural gas pipeline primarily to serve local needs, but is likely to be given a much-expanded role in representing Alaska in work toward a multi-company, large-diameter line costing tens of billions of dollars.

Contact Pat Forgey at pat(at)alaskadispatch.com.