Time - Man of the Year/Time_Man_of_the_Year_Compact_Publishing_3YX-Disc-1_Compact_Publishing_1993.iso/moy/092892/0928330.000

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                                                                                ENVIRONMENT, Page 60

Alaska's Billion-Dollar Quandary


A battle is raging over how best to spend the settlement money
from the Exxon Valdez disaster

By MICHAEL D. LEMONICK --With reporting by Andrea Dorfman/Kodiak


    To a casual visitor, the chill, choppy waters of Prince
William Sound show little evidence of the disaster that struck
on Good Friday 1989. Nearly 11 million gal. of crude oil poured
from a gash in the grounded tanker Exxon Valdez that day,
forming a slick that eventually reached into the Gulf of Alaska
and nearly to the Shumagin Islands, about 965 km (600 miles)
away. More than 1,930 km (1,200 miles) of coastline was fouled;
commercial and subsistence fishing were halted; populations of
bald eagles, seabirds, otters and other animals plummeted; and
at least 35 archaeological sites were sullied. Now, after four
summers of intensive oil scooping and shoreline scrubbing,
seals, whales and bald eagles are plentiful and the fishing
season is in full swing. The water, rocks and sand look pristine
once more.

    But looks can deceive. According to biologists, Exxon's
$2.5 billion cleanup effort was by no means as effective as the
company has proclaimed. Many killer whales have vanished from
Prince William Sound, while the social structure of the
remaining groups appears to be breaking down. Several large
colonies of murres, a seabird, have not produced any chicks in
the years since the spill. Harlequin ducks, black oyster
catchers and other animals have been contaminated by eating
oil-drenched mussels, and sea-otter populations are
hemorrhaging, literally and figuratively -- a side effect of
hydrocarbon poisoning.

    Part of the problem is the disaster's magnitude, but
scientists and environmentalists charge that Exxon squandered
vast sums on paperwork, ill-conceived cleanup techniques and
heroic rescues. It cost the company about $80,000 for each of
the several hundred otters it cleaned, many of which died
anyway. The use of scalding-hot, pressurized seawater to hose
down beaches left many areas almost sterile, empty of the
limpets and other intertidal creatures that dwell there.

    No amount of money could ever fully compensate for the
havoc wreaked by the Valdez spill, but the record $1.025 billion
in fines and damages imposed on Exxon by a federal judge last
October should have provided the state and federal governments
with an extraordinary opportunity to take further protective
measures, assess remaining problems and mollify resentful
citizens. Instead, the deal has touched off a chorus of outrage
from residents and environmentalists, who wanted a minimum of
$2 billion, and has ignited a fierce debate over how best to
spend the sum. Says biologist Rick Steiner of the University of
Alaska: "The last thing we want to see out of this is a stack
of studies, symposia and who knows what else."

    Unfortunately for Alaska, the windfall is far less than it
seems. After deducting the sums owed to federal and state
governments for past cleanup, litigation expenses and damage
assessment, Alaska can expect just $635 million. How to spend
it is the official business of the six-member oil spill trustee
council, which includes the Alaska attorney general along with
representatives from two state and three federal departments.
The body has already come under fire. Alaskans claim that
Washington's representatives are watching out for the Bush
Administration's interests and that the council is unreceptive
to the views of the public. Environmentalists criticize the
council for acting too slowly and for wasting money on items
like excessive overhead.

    But this hasn't stopped Alaskans from going aggressively
after a slice of the pie. The trustee council has received
nearly 450 proposals from environmentalists, scientists,
government employees, tour-boat operators, fishermen and others.
There are a few oddball ideas, like dismantling the trans-Alaska
pipeline, but most are worthwhile projects -- expanding wildlife
refuges and parks, for example, or building fish ladders and
establishing a marine public-information center.

    For now, the trustee council seems to be considering three
broad areas of spending: land purchases to protect vital
habitats, scientific studies and some type of endowment that
would invest the money and finance restoration from the
interest. Environmentalists contend that putting too much into
an endowment would prevent the state from tackling expensive but
urgent projects. Scientific study, on the other hand, has strong
support from the conservationists, who advocate such efforts as
long-term monitoring of wildlife and assessments of which
habitats should be purchased. There is some concern, however,
about the council's judgment. It has been accused of
rubber-stamping projects that involve the state's powerful
fishing industry and favoring scientists who work for the
government agencies represented on the council. "Lots of people
stand to gain personally from how this money is spent," charges
Lisa Rotterman, an independent biologist.

    Habitat acquisition has attracted nearly universal public
support. An unlikely coalition of environmentalists, commercial
fishermen, native Alaskans and state legislators wants at least
80% of the money to be used to buy and preserve 202,000 hectares
(500,000 acres) of prime fish and wildlife habitat, either by
purchasing the land outright or by buying up the rights to
exploit its resources. The advocates argue that since little
more can be done to restore areas damaged by the spill,
protecting the region's ecosystem from further harm is the next
best option. Much of the land is privately held old-growth
forest already marked for logging -- some of it, thanks to the
state's complex land-allotment system, actually inside state and
national parks, including Kenai Fjords National Park, the Kodiak
National Wildlife Refuge and Kachemak Bay State Park.

    The advantages of habitat acquisition are manifold.
Old-growth forests provide nesting sites for some of the bird
species harmed by the spill. Watersheds and upland forests offer
food and breeding areas for mink and river otter as well as
salmon and other fish. Protecting prime habitat from logging and
development will also benefit hunters, fishermen, kayakers,
hikers and the growing tourist industry.

    For native Alaskans, who own much of the land in question,
such deals would provide needed cash. The Afognak Joint
Venture, for instance, a coalition of native corporations, hopes
the trustee council will purchase its 50,000 hectares (125,000
acres) on Afognak Island, a mountainous place nearly the size
of Maui, brimming with salmon, elk, Kodiak bears and bald
eagles. Though part of the island belongs to the Kodiak Refuge,
the AJV lands are being logged and could be stripped bare within
a decade. Asserts AJV chairman Howard Valley: "By selling it
back, at least we will be able to preserve it."

    Also competing for funds is the Kodiak Restoration
Committee, a partnership of native groups, fishermen, businesses
and government agencies in the Kodiak Island Borough, a
51,800-sq-km (20,000 sq. mi.) district at the southernmost point
of the Valdez spill zone. While the borough's wildlife escaped
serious damage, its all-important fishing industry suffered
mightily. "Domestic violence and divorces soared, and visits to
mental-health services almost doubled," says borough Mayor
Jerome Selby. "We're never going to be able to mend the social
fabric of the community." The borough wants $280 million to
create nature preserves, recreation areas, a fisheries
technology center, an archaeological museum and other projects.

    With so many groups vying for money, some are bound to go
without. Trustees say privately that they will probably devote
some of the settlement to habitat protection and scientific
studies but bank most of it in an endowment. A preliminary plan
could be released early next year. But given the competing
claims and heated emotions, it, like the Exxon Valdez spill
itself, will almost certainly leave in its wake a residue of
anger and disappointment.