Alaska’s attorney general said the North Slope Borough does not have the authority to commandeer property belonging to RavnAir Group, which recently filed for bankruptcy protection because of the economic damage of the coronavirus.
North Slope Borough Mayor Harry Brower signed an emergency order Sunday calling for the borough to take possession of assets controlled by RavnAir Group within the borough’s boundaries. The order states the borough must ensure its residents “have food, medical supplies and medical transport.”
RavnAir Group cited the new coronavirus when it announced Sunday it would halt operations, temporarily lay off all remaining staff and file for Chapter 11 bankruptcy protection. The decision affects the company’s three airlines: RavnAir Alaska, PenAir and RavnAir Connect.
It is Alaska's largest regional carrier and said it lost 90% of passenger revenue because of the pandemic.
State Attorney General Kevin Clarkson, in a statement, said the airline's property is part of its bankruptcy estate. "This means the North Slope Borough order is void under federal and state law," he said.
While the state appreciates concerns with ensuring there is air service for affected communities, "the North Slope Borough's actions in this case were counterproductive," Clarkson said. "As long as local governments might be attempting to seize Ravn's property it will be more difficult to establish replacement air service."
For most people, new coronavirus causes mild or moderate symptoms, such as fever and cough that clear up in two to three weeks. For some, especially older adults and people with existing health problems, it can cause more severe illness, including pneumonia and death.
Brower, in an email Monday, said the borough has "tried to work with Ravn whose news has gone from limiting services, to cutting services, to pulling out of the Slope, to as of last night filing for Bankruptcy and locking the Deadhorse and Utqiagvik facilities."
"Residents learned of most of this on a note posted to terminal doors," he wrote.
The order would allow other airlines to use the facilities to serve the community, he said.
RavnAir did not did not have an immediate comment on the order.
RavnAir handled Utqiagvik and Deadhorse ground operations, including sorting mail and cargo and operating hangars. The company's bankruptcy announcement came with a mandate to close facilities for the delivery of mail and freight.
RavnAir scaled back operations late last week, raising a question of how communities would receive mail and freight.
The U.S. Postal Service is using "a patchwork of different carriers" to serve the communities, spokesman David Rupert said.
Wright Air took over mail delivery for the North Slope Borough and made commitments to hire a small group of RavnAir employees in Utqiagvik to assist ground operations, co-owner Matt Atkinson said.
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