Gov. Walker Orders Spending on KLC Halted

Jay Barrett/KMXT

Governor Bill Walker has ordered the stop of any new spending by the Alaska Aerospace Corporation on the state-owned Kodiak Launch Complex. Its part of an executive order issued Friday that calls for a time-out on six large projects around the state that includes the roads to Ambler and Juneau, the Susitna Damn, the Knik Arm Bridge and the Alaska Stand Alone gas Pipeline Project.

Walker is also requiring the Alaska Aerospace Corporation, along with the agencies responsible for the other projects, the Department of Transportation, Gasline Development Corporation, Energy Authority and Knik Arm Bridge and Toll Authority to submit a report to the director of the Office of Management and Budget detailing all discretionary funding obligations, a spreadsheet of non-discretionary funding obligations, including contracts, and the potential costs to delay, suspend or terminate them. Operating costs to date and budgeted personnel costs for the rest of the fiscal year are also required.

In the order, Walker said the severe drop in oil prices, contributing to a growing budget deficit, is forcing him to call a time out on the six projects. It’s a step Kodiak Senator Gary Stevens said Saturday he agrees with:

“You know I think the governor is doing exactly what I think he should be doing in saying let’s take a look at every major expenditure and make sure it’s what we should be doing. And in the end it’ll be beneficial to the state of Alaska. I think what he’s done, and specifically in terms of the rocket launch – and realize wasn’t looked any different than anything else, the railroad, the university, whatever – but it’s good to stop and have a serious look at it.”

Stevens said the Kodiak Launch Complex and the Alaska Aerospace Corporation have seen lean times in the past, and doesn’t think this move by Governor Walker is necessarily the beginning of the end for the operation.

“As you may recall, we were in this same position a few years ago. And the rocket launch folks, the president, met with Governor Parnell at the time at the time, and Parnell came away quite convinced the future could be quite good. And I think we’ll see what happens. Walker is doing the right thing here, but unless there’s something serious on the horizon, maybe it is time to begin closing the thing up. But if there is an opportunity, then we’d just be foolish not to take advantage of it.”

Alaska Aerospace CEO Craig Campbell could not be reached Saturday for comment. His office, and that of the other agencies affected, have until January 5th to submit the financial data requested by Walker. In the meantime, funds, whether state or federal, may only be spent on expenses they are currently committed to. Walker gave no indication of a timeline for when the projects would be reviewed and discretionary spending could begin again.