‘We will be made whole’: Land exchange meant to right an Exxon Valdez oversight

The Chugach Alaska Corporation holds full title to approximately 378,000 acres of real estate in the Prince William Sound region, plus 550,000 acres of subsurface rights. (From U.S. Bureau of Land Management)

It often takes an act of Congress to trade or give away federal land in Alaska — and Sen. Lisa Murkowski (R-Alaska) is proposing one to help a regional Alaska Native corporation.

Her bill would allow a land exchange between the Chugach Alaska Corp. and the federal government in Prince William Sound.

Murkowski’s legislation, the Chugach Land Exchange and Oil Spill Recovery Act, has support from her Alaska colleagues in Congress, Sen. Dan Sullivan and Rep. Mary Peltola.

Murkowski said the bill would right an old wrong that goes back to massive land buyouts following the Exxon Valdez oil spill in 1989. An Exxon settlement paid for the land to be set aside for habitat protection and spill recovery.

Native corporations, as the largest private landowners in the region, were offered millions for their land. Those who worked on those land deals have cast a nervous eye on Murkowski’s bill. For Chugach, the legislation is the culmination of years of work.

Although it’s been 35 years since the Exxon Valdez dumped 11 million gallons of oil into Prince William Sound, the memory lives on.

“There are still beaches in Prince William Sound where there is still residual oil,” said Sheri Buretta, the chair of Chugach Alaska’s board. She has worked for years to help communities in Prince William Sound recover from the spill, which nearly destroyed a way of life, tied intimately to what the land and sea provide.

“This legislation is an opportunity to make us whole and allow us to heal,” Buretta said.

The Chugach region has a long history of healing from adversity. There was the tsunami unleashed from the 1964 earthquake, which wiped out the village of Chenega. Then came the Alaska Native Claims Settlement Act in 1971, which returned title to some Native lands, but left most of it in federal hands, so the promise of ANCSA to empower regions to develop their resources has yet to be fully realized. The Exxon spill put Chugach’s hopes further out of reach, when habitat protection programs limited opportunities for development.
Murkowski’s bill revisits a land buyout in the 1990s, overseen by the Exxon Valdez Oil Spill Trustee Council. State and federal representatives were appointed to the council to manage money from a $900 million court settlement that Exxon was ordered to pay over 10 years.

The Trustee Council used most of that money to buy land to protect habitat, including 241,000 acres in Prince William Sound, owned by four Alaska Native village corporations: Chenega, English Bay (Nanwalek), Eyak, and Tatitlek. Chugach retained the underground property rights.

The village corporations were paid a total of $132.4 million, but Chugach wasn’t part of the buyout.

“I think what people forget is that we do have this split estate issue in Alaska,” Murkowski said, “where one entity owns the subsurface (rights, and) the other owns the surface.”

The split estate predicament is one of the legacies of the Alaska Native Claims Settlement Act, which created regional and village corporations to settle longstanding battles over land ownership. Under ANCSA, village corporations received title to the surface land, but everything underneath went to the regionals. The intent was to have them work together to develop the resources.

But after the buyout, it was difficult for Chugach to develop its mineral rights – and even harder after the Trustee Council divvied up the land among different federal agencies. Chugach says this created more regulatory hurdles that were expensive to overcome.

Murkowski’s bill would solve the split estate problem by trading Chugach’s underground holdings for federal land. In exchange for 231,000 acres of subsurface land, Chugach would get title to 65,000 acres of land, mostly owned by the U.S. Forest Service.

Chugach’s chairman, Sherry Buretta, calls it a win-win.

“We will be made whole. The federal government will be made whole,” Buretta said. “It’s a good deal for both parties.”

Buretta said the bill puts both the surface and subsurface land under complete federal control, which better protects the habitat on those lands from future development.

Under the terms of the existing buyout, the federal government must give Chugach reasonable access to its underground resources, which turned out to be neither practical nor desirable.

That became evident after Chugach exercised its subsurface rights in 2018, when it opened a granite quarry at Port Gravina on land the Trustee Council purchased. Although the U.S. Forest Service approved the project, the quarry revealed the inherent conflict in split estates, when surface land is set aside for conservation, but the subsurface rights allow development. Advocates for the land buyouts had hoped they would prevent development from disturbing land. Chugach also learned that exercising its mineral rights was challenging, so it began to pursue the land trade.

“It’s adjacent to culturally meaningful land that we already own in that area,” Buretta said. “We’ve run this youth and elders spirit camp out there for 30 years.”

The Chugach Alaska Corporation wants to trade for federal land near its Nuuciq Spirit Camp on Hinchinbrook Island in Prince William Sound. (Courtesy Chugach Alaska Corporation)

Chugach says it will use the rest of the land for the cultural and economic benefit of the region, while also keeping in mind the need to protect and preserve it for future generations. But Rick Steiner, a longtime environmental activist, opposes the deal.

“I do think they deserve to have the subsurface estate retired and compensated for fairly,” said Steiner, a marine conservation biologist who served as the University of Alaska’s marine advisor before and during the oil spill.

Steiner, an early advocate for the Exxon settlement and habitat protection program, believes it would be better to compensate Chugach with cash or with property from outside the region. He said the corporation has selected lands that should stay in federal hands, to keep it pristine.

“What you can do, and what you must do, is protect the ecosystem as much as possible from additional damage,” Steiner said, “giving the injured ecosystem the best chance possible to recover on its own.”

an oiled bird
A bird covered with oil from the Exxon Valdez oil spill in March 1989. (Courtesy

He said one of the big lessons of the Exxon Valdez tragedy is that full environmental recovery is impossible, so the next best thing is to preserve habitat.

“I get it that there’s this long-running debate in Alaska, and this is part of it,” Steiner said. “But this is one area in Alaska we have to conserve and protect.”

Steiner said taxpayers’ interests also need protection and doesn’t believe they would get good value in the proposed trade.

Murkowski said she finds such attitudes paternalistic. She said it ignores the needs of the people, who have called this region home for as long as they and their families can remember.

“I think there’s this notion that there’s a monetary equivalence that beats out the actual land itself,” she said. “I don’t think they get it.”

Murkowski said people of the region value the land for their connection to it, and land somewhere else is not the same thing.

“‘So, ‘Just pay me off’ — and I use that in air quotes — is not what the people of the region have been looking for,” she said.

So, what is the cost to taxpayers for this proposed land-for-mineral rights deal?

Murkowski said there’s no price tag set, because it’s a trade and its value goes beyond the land itself.

Jim Ayers, a former director of the Trustee Council, agrees that it’s hard to put a dollar value on the land exchange, but for different reasons. He said the federal land is a world treasure that belongs to the nation.

“Congress ought not to act without bringing the public back into the discussion,” Ayers said.

Ayers oversaw some of the buyouts in the 1990s. He worries the exchange will undermine the Trustee Council’s huge investment in habitat protection.

A federal study submitted to Congress in 2022 lays out the options for the exchange and calls for an extensive public hearing process.

Sara Taylor, currently a federal representative on the Trustee Council, said a review of the digitized records from the land buyouts that took place from 1994 to 2020 don’t give a clear picture of why Chugach was not part of the deal with four village corporations. The record also doesn’t indicate that Chugach wanted to sell its underground holdings. She said it’s possible that at the time, the focus was on protecting the surface estate, which was more vulnerable, and the consequences of a split estate ownership were not fully understood.

Taylor said the Trustee Council has no position on the proposed land exchange and has not considered any resolutions on the matter.

Chugach, for its part, does not fault the village corporations for selling their land for conservation. The spill devastated Prince William Sound’s commercial and subsistence fisheries, and the buyouts were an economic lifeline.

Although there was compensation for the village corporation lands, there is a lingering sadness that what ANCSA conveyed to Native corporations ultimately returned to state and federal control.

For Chugach Native, there is an irony in all this. Before the British, the Spanish, the Russians and the Americans laid claim to Prince William Sound, all of it belonged to the people of the Chugach region.

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