Eklutna, muni settle gas dispute for $5.75 million

Monday, January 16, 2017 - 22:15
Tentative deal must still go before assembly for approval
  • Eklutna Inc. CEO Curtis McQueen, left, and Anchorage Mayor Ethan Berkowitz speak to reporters during a press conference Wednesday, Jan. 4, 2017 at Eklutna's Eagle River headquarters. The two announced that Anchorage has agreed to pay $5.75 million to settle a dispute over natural gas generated at the city landfill and sold to Joint Base Elmendorf-Richardson.

Eklutna Inc. and the Municipality of Anchorage have agreed to settle a dispute over millions of dollars claimed by the Native corporation for natural gas generated at the Anchorage Landfill and sold to Joint Base Elmendorf-Richardson.

Under terms of the agreement – which must still be approved by the Anchorage Assembly – the muni will pay Eklutna $5.75 million to settle the dispute. In a lawsuit filed in 2013, Eklutna claimed the municipality could owe it as much as $24 million over two decades. If the new deal is approved, Eklutna will agree to give up all future claims to revenue from the gas.

At a news conference announcing the deal Wednesday at Eklutna’s Eagle River headquarters, Anchorage mayor Ethan Berkowitz said the settlement allows the two sides to move forward with other issues. Eklutna is the largest private landholder in the municipality.

“We ought to be neighbors and partners,’ Berkowitz said.

Anchorage’s landfill generates methane, which the municipality began selling to the Fort Richardson power plant in 2012. In 1982, Eklutna and Anchorage signed the North Anchorage Land Agreement, which was reached after the two parties realized they had competing claims for the land on which the 274-acre landfill sits. The Native corporation has argued the agreement gives it the right to half of any income generated from the land.

The dispute had caused a rift between the city and Eklutna that both parties wanted to get past.

“This dispute become a choking point,” Berkowitz said.

Now that the dispute is settled, the two groups can work more closely on issues such as land development in the area.

“We’re all on the same page,” said Eklutna CEO Curtis McQueen, who was flanked by several members of the Eklutna board as well as Eklutna Vice President and tribal Chief Lee Stephen.

According to Berkowitz spokesperson Myer Hutchinson, landfill gas sales have generated over $6 million and is expected to continue producing gas for decades.

In addition to relinquishing future claims on the gas, Eklutna also agrees to move forward with development of two large parcels of land near Eagle River. Known as Powder Acres and Powder Hills, McQueen said the land will be developed with both single-family and higher density housing.

The deal also spells out a timeline for development of the residential properties. Hutchinson said in an email that Anchorage Water and Wastewater Utility (AWWU) will seek approval to build needed water and sewer lines to the parcels near Eagle River. Once those lines are completed, Eklutna will have three years to complete Powder Acres and five to complete Powder Hills.

McQueen said plans haven’t been finalized for any development, but said Eklutna’s track record of building livable neighborhoods in Eagle River speaks for itself.

“I think everyone has been impressed with what Eklutna has done,” he said.

This is a developing story; check back for details.

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