AIDEA claims state law allows oil lease bids, but it doesn't

The Alaska Industrial Development and Export Authority claims on its website that a provision in state law gives it the ability to bid and acquire oil leases in the Arctic National Wildlife Refuge.

But the state law in question doesn’t say what AIDEA claims it says.

AIDEA offers this legal justification for spending up to $20 million on leases and lease payments from the infrastructure development fund: “According to statute 44.88.830.a5, AIDEA has the authority under the Arctic Infrastructure Development Fund to enter into leases and to enter into agreements with government entities.”

But 44.88.830.a5 doesn’t mention leases of any kind, including oil leases. It doesn’t mention oil exploration, drilling for oil, building pipelines and producing oil. It doesn’t mention anything about a project similar to what AIDEA has in mind for ANWR.

The law says AIDEA can use the infrastructure fund to “enter into agreements with government entities for the transfer and control of infrastructure, facilities, rights-of-way, and studies. . .”

Leasing land for potential oil development is not the transfer and control of infrastructure, facilities, rights-of-way, and studies.

It is only allowed in the wishful thinking division of the development and export authority.

AIDEA says it plans to “use its resources to advance the responsible development of these leases directly and in partnership with private capital investors.”

When legislators created the infrastructure development fund, they didn’t give AIDEA the authority to take money out of the fund to develop projects directly.

The law creating the fund mentions loans and loan guarantees to finance infrastructure development, but AIDEA has decided to go far beyond such activities, bypassing legislative review of items that should have been in the capital budget and debated in public.

AIDEA used the same logic to put $35 million forward for the predevelopment work on the proposed Ambler Road.

It appears that while the agency does not have the authority for these projects, it will interpret the law to pretend that the actions are legal. It does not have to justify the decisions because it has not been stopped by the courts or the Legislature.

Trustees for Alaska wrote to the AIDEA board Jan. 11 about why the leases are not allowed by the law that set up the infrastructure fund.

The regulations governing the fund say it can be used for loans, to issue bonds and to guarantee loans or bonds.

“In its rush to obtain these leases, AIDEA has completely disregarded these limitations on its statutory authority and it cannot proceed,” the environmental group said. “Should AIDEA proceed, the Gwich’in Steering Committee and their partners stand ready to fight these leases and oil and gas activities on the Coastal Plain every step of the way.”