Alaska Aerospace discusses payments in lieu of taxes, dividends, in public meeting

Alaska Aerospace Corporation held a public meeting last night at the Kodiak Convention Center, to explain next steps in their Master Plan, including a policy to start making payments to the borough and state.

Alaska Aerospace Corporation launch facility on Narrow Cape. (Photo courtesy of Alaska Aerospace Corporation)

The policy allows the board to allocate up to 20 percent of AAC profits for dividends to the state of Alaska, as well as payments in lieu of taxes to the borough. It works on a rolling five-year average of the company’s profits. The policy is only in name for now, however, since according to former CEO Craig Campbell, the company isn’t profitable, it’s only “cash-positive.”

Because the Pacific Spaceport Complex sits on state land managed by the Alaska Department of Natural Resources, the corporation doesn’t pay property taxes to the borough, something that citizens have long expressed displeasure about. Campbell said after Tuesday’s meeting that the board adopted the dividend policy several months ago in order to be a “good corporate partner in the community,” since the facility uses borough infrastructure like the port of Kodiak, airport, and roadways.

The dividend to the state would be a form of returns on what Campbell estimates is about $70 million that the state put into the complex to build new facilities and keep it running.

The policy is mentioned in AAC board minutes as far back as 2017, though it wasn’t formally adopted into the corporation’s policy manual until September, 2018.

Around 30 community members were present at Tuesday’s meeting, and almost everyone who gave public comments were critical of AAC, particularly for the company’s lack of disclosure around some confidential contract details and its impact on the environment out on Narrow Cape, a popular area for outdoor recreation. The potentially dramatic increase in launches that Campbell and CEO Mark Lester have forecasted also continue to create concern, since each one represents road, air, and waterway closures that disrupt transportation and fishing interests.

AAC’s CEO Mark Lester described the forum as an opportunity to get public involvement on the future of the Pacific Spaceport Complex so that it “meets all our needs.” He and Campbell said at the meeting that public comments are an important part of the process and that solutions or alternative options will be developed and presented at a later date.

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