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Tom Kelly Interview

Note about this audio: Interview starts at 31 minutes.

Interviewer:
OK, I'm going to state for the benefit of the tape, this is an interview with Tom Kelly. The subject is state land selections between statehood and 1976. And today's date is August 21st 1981.

Now, at the time that you became commissioner of the Department of Natural Resources, the selection program was pretty well frozen, I believe.

Tom Kelly:
That is correct. There was the initial so-called land freeze imposed by then-Secretary Udahl. It was later, of course, strengthened by an executive order withdrawal. But that so-called-- I forget what we called it. The initial land freeze was imposed in 1966.

Interviewer:
December of that year.

Tom Kelly:
Yes.

Interviewer:
Do you happen to recall if that was imposed by a secretarial order? Or what the instrument that was used was?

Tom Kelly:
It was not-- I think it was a secretarial order. It was not an executive order withdrawal, as was the so-called Super Freeze.

Interviewer:
That was in December of '68.

Tom Kelly:
Yes, that was called the Super Freeze. And that was an executive order withdrawal. This was by secretarial fiat as far as I was concerned. I was not commissioner at that time. I did not actually officially take office until November of '67.

Interviewer:
Yeah.

Joe Blum:
And this happened prior to that time. I was aware of it because I had been engaging with then-Governor Hickel who hired me.

Interviewer:
Now, when you first started as commissioner, did you discuss selection policy at all with Governor Hickel Or was it just kind of on the back burner because of the frozen--

Tom Kelly:
No, we felt that the action taken by the secretary was improper, if not illegal. It totally circumvented the intent of Congress and the Statehood Act. And we had numerous discussions on the validity of the secretary's actions, and what we should do about it.

So we were-- it was a very, messy you might say, keen area of concern, one that we intended to do-- take every steps that we could within our power to you might say overcome.

Interviewer:
Now, I came across an old memorandum probably from Governor Hickel's office, from Hank Pratt, who I believe was an assistant to the governor, to you. Which says, would you please advise this office of the present status of planning for land selection under the Statehood Act, pending the lifting of the land freeze? And that's dated January 7th 1970.

And I was wondering-- I didn't find response to that. But I was wondering what kind of planning was going on during that period. The state didn't really begin any major selections until after you left office, I realize.

Tom Kelly:
There was considerable planning. Hank Pratt was the executive assistant to then-Governor Keith Miller. Hickel head departed for Washington. Hank Pratt wrote that memorandum. You know, it's been many years ago. But I vaguely recall it.

I don't know whether my response was in writing or during a conference to the governor. I would have bet you that I would have responded in writing. But, you know, things do have a tendency to sometimes get lost in shuffle.

Interviewer:
Yep.

Tom Kelly:
In any event, I did ask the staff of Joe Keenan and his people in the division of lands considerably prior to my departure is Commissioner of Natural Resources to review areas that we ought to consider identifying for state selection.

As a matter of fact, the then-secretary of the Interior, Hickel, made a speech before the legislature in 19-- I guess it was sometime-- I guess it was in the fall. I can't remember exactly, but 1970 before the elections.

To the extent that-- and I recall pretty vividly that something was going on. The action taken by Udahl was going to terminate 1171, as I best recall. You might find something in the history on that.

But in any event, he made the statement that he was going to lift the land freeze the first of the year. And that would have been '71. Of course, the election was in between. And we, in effect, were lame ducks no longer in office as of 01/71.

But predicated on that announcement-- it was publicly made. He made it-- I know he made it before the legislation-- or the legislature wouldn't have been in session. But he made it at a speech somewhere. Maybe it was at a Chamber of Commerce or something. But he came out and said it emphatically, that he was going to life the land freeze.

You probably can research the Anchorage Time or the news about that time, in the latter part of '70. And you'll see where he announced that he can lift the land freeze.

Interviewer:
And by 01/01/71?

Tom Kelly:
By 01/01/71.

Interviewer:
I think he was Secretary of Interior.

Tom Kelly:
That's right. He'd already gotten his walking papers, I believe, by that time. Pretty sure that happened about-- well, let's see. He got cut off-- I can't remember exactly when it was. I guess it was-- when he was actually let go, I think it was in November of '70, of 1970.

Anyway, in any event, predicated on his announcement that they would lift the land freeze, I set the wheels in motion to identify, at that time roughly I believe it was 26 million acres for additional state selection.

We attempted to-

Interviewer:
Excuse me, where did that 26 million acre figure come from?

Tom Kelly:
That just rings a bell in my mind. We had a lot more than that to select. That time, I think we only had selections in the neighborhood of six or eight million acres.

Interviewer:
I think the total selections of that time probably would have about 30 million acres. But you still have--

Tom Kelly:
Conveyance was sixth rate, very little.

Interviewer:
Yeah.

Tom Kelly:
But in any event, we selected, as I recall, something like 26 million. These are give or take figures. It has been so many years. But it wasn't anywhere near the total state entitlement of 103 million acres. And that was the best, of our knowledge at that time, of lands we thought would be suitable for state selection.

Of course, at this time there was a lot of action activity pending as far as some solution to the Alaskan Native Claim Settlement Act. It was in the mail. It did not pass until, as you know, December of 71 here. And Udahl imposed super freeze in intervening that.

We did go so far as to identify these areas. There were warrants cut and escrowed with the state selections prior to my being replaced as Commissioner of natural Resources in late 1970.

Interviewer:
Those were warrants in order to cover filing fees?

Tom Kelly:
Yeah, the filing fees were $40 per township.

Interviewer:
Uh-huh, you so the applications were all ready to go whenever the land freeze was lifted.

Tom Kelly:
Right. It was done solely based on the idea that the land freeze would be lifted. We had no knowledge that there would be a super freeze come on top of that, and that the Secretary Hickel would be released, and we couldn't go forward.

Of course, that all went down in flames because of the ensuing events. But it was the full intention of that time to move along the state selections, being fully aware that time was running out and that these areas had been considered for many, many years, long before even the involvement became very thick as far as the native land claims issue.

In other words, the lands that were identified were done for various purposes, both for service values, for mineral estate-- both hard rock, and basically energy resources, oil and gas. There was not nearly the amount of acreage identified as became later when my successor, Chuck Herbert took over.

Interviewer:
Yes, now when you said about hard rock minerals--

Tom Kelly:
A little bit on that.

Interviewer:
Because previous to your tenure as commissioner, the policy had been not to select lands for that purpose.

Tom Kelly:
Right. It didn't become really a push until Mr. Herbert took over. That's what he identified, so many areas that had hard rock mining potential.

Interviewer:
Uh-huh.

Tom Kelly:
But I had some in there, as I recall, in a few of the mineral districts, the [INAUDIBLE] district, and things like that.

Interviewer:
I see.

Tom Kelly:
But in any event, they were properly executed, filled out. And of course we couldn't do anything. And of course, I think about that time we had the election. November, the change of administration was eminent.

But pending the land freeze, I did have these escrowed, hopeful that the land freeze would lift as of the first of the year.

Interviewer:
I see. Now, backing up a little bit, I guess it would have been just over a year after you became commissioner, the state did select about 7 and 1/2 million acres on the north slope, the Copper River valley, and the north side of the Alaska peninsula.

I was wondering if you could pull me in some on what the political situation was at that time. Now, I know that the major rationale for the selections was that the state was about to lose its right to select federal lands that were in the mineral leases.

Tom Kelly:
Right. That was the principal reason.

Interviewer:
It was also approximately coincident with the Super Freeze. And I was wondering if that played any part in--

Tom Kelly:
No, no. As I recall, the Super Freeze-- and like I say, this is awful difficult for me to piece everything together without having to do some considerable reflection.

Interviewer:
I realize that.

Tom Kelly:
But the Super Freeze was a big surprise to us. We didn't think that such a thing could take place, really. And that the other freeze in effect was challengable, and should not have had any force or effect of law. But it was circumventing the Statehood Act.

And so I don't believe there was a coincidental aspect. I was advised by-- I think Pedro Denton at that time. It was the minerals option. We had this deadline that had to be followed. In effect, it was 10 years from statehood. And we had to exercise on that.

Interviewer:
Yes.

Tom Kelly:
Or else lose those leases that were covered by then-existing valid federal mineral lease.

Interviewer:
So the intent at that time was purely to select land--

Tom Kelly:
Solely to beat that deadline, as imposed by existing law.

Interviewer:
Because I'm under the impression that some of the lands that were identified-- at least on the Alaska peninsula, if not in the other two areas-- weren't, in fact, under mineral leases. That was--

Tom Kelly:
I just couldn't recall. There were leases stemming back from the late '60s-- or late '50s and early '60s that virtually covered almost everything in Alaska. That was right following Swanson Rivers' discovery. Most of Alaska was under-- federal lands were under lease. I think if you go back and check, there were literally 30, 40 million acres under lease.

Interviewer:
I see.

Tom Kelly:
And they were all over the place, the Alaskan peninsula-- I think they had them-- I can't recall specifically who were the lessees down there. But I bet you they were covered. They were all over the entire state.

Interviewer:
So you don't have any recollection that there was any intent to select other lands other than those under lease?

Tom Kelly:
No, I'm pretty sure that they must have had some connotation with existing federal leases.

Interviewer:
I see.

Tom Kelly:
We didn't attempt that to-- I don't believe we would have done it that way regardless, because we would have taken more than seven or eight million, and we would have a more deliberate plan involved.

In this instance, when we selected in 1970, as I best recall, I had had communication with the Department of Fish and Game specifically and, of course, people in my shop to try to determine what areas they thought were very necessary as far as being picked by state selection.

And I don't believe we would have picked out just a few acres back in 1967 just to comply with that-- or '68-- just to comply with the requirement of the 10 years.

Interviewer:
Yeah. Now, you mentioned your working with Fish and Game Department. And you signed the cooperative agreement I believe with Augie Reetz was the Commissioner or Fish and Game at that time.

Tom Kelly:
Right.

Interviewer:
And that was a departure from previous policy. Fish and Game, by and large, felt like they didn't have very much input into the selection process. How did that agreement come about?

Tom Kelly:
Well, I thought it was appropriate that sister agencies, who were generally resource management agencies, ought to have a little bit more of a comraderiship than they had in the past.

And of course from that grew a situation where, in effect, the pendulum almost swung the other way 180 degrees. Fish and Game were asserting a, I would say for a number of years, the dominant role on resource management activities.

And still to this day, has pretty much what would be construed, I guess, as a veto power in certain habitat areas. This was the first attempt, to my recollection, to try to get a good working relationship and have a knowledge of the fact that certain lands are best managed for habitat rather than minerals.

But I mean, we weren't abdicating natural resources responsibilities. But we were trying, for perhaps the first time, to work in concert. I mean, I thought that was the way to go. I see conflict between state agencies as being destructive to running a good government.

Interviewer:
Mhm, I see. Now, you mentioned before that this Super Freeze was a complete surprise to you. By the time that the 77 million acre selection was made, Chuck Herbert and the people in the department at that time had already reached a point where they doubted that the state would ever have the opportunity to completely select its entitlement.

Had things begun to reach that point while you were still commissioner? Where people began to wonder if the entitlement would ever be reached?

Tom Kelly:
Yes. That was one of the most serious concerns we had. It was often reflected had the state had the money. And of course, this would avoid a lot of the-- had the state had the $40, quite frankly.

At statehood we had some transition funds. But they were readily gone through. you know, it didn't take but a few years to go through those transition funds. And it was $40. So I can remember several conversations that were just offhand discussions that it was too bad we didn't have a few tens of thousands, or $100,000, or whatever it was back in 1959, and could have selected the whole shooting match.

And everybody said well, you had no knowledge. Well, we probably could have made a decent stab at everything under 3,000 feet coming out pretty well, with the exception of hard rock mental potential.

But it was often remarked that had we had the opportunity to move ahead and select 103 million acres, hindsight would have would have dictated that you would have done it. And of course you would have avoided then, of course, the conflict with the regional corporation that ultimately led to land exchanges and everything else.

But in those days, we didn't know that we'd have a ANILCA act going to pass, or anything else.

Interviewer:
Yeah, yeah. I think the one other area that I wanted to cover with you was your recollections of how the native problem, native challenge, to state selections and such, how that evolved while you were commissioner.

Now, I realize that had already become a fairly hot issue by the time--

Tom Kelly:
Oh, yeah. Well, it was a difficult thing. I think Governor Hickel indicated a willingness to cooperate with the AFN at that time. There was a number of conferences back in DC. There was quite a bit of politics interjecting, I think. Because Boyko was attorney general before that time.

And a lot of the stuff was going on about what's a fair amount of acreage? Obviously as Commissioner of Natural Resources at that time, I felt like my first duty was to--

Interviewer:
Could you hold just one moment please? I'm sorry. Go ahead.

Tom Kelly:
Anybody serving in that capacity, as I was at that time, that my first responsibility was to all of the people of the state, in other words, the state of Alaska as a whole. Although there were certain certainly no feeling in the department that there wasn't a valid native lands issue, and native entitlement. In other words, their title had not been extinguished by any reasonable stretch of the imagination.

Although I know we had difficulty because of a number of acts coming up in various sessions of Congress and then dying away. And each time it began, it came back, the native lobbyists as well as their effectiveness in Congress grew greater and greater.

It started out, as I recall, they were talking four, five, six million acres in the early days. Then of course, that grew at each session of Congress, until finally the final act had 44 million acres.

And with that coming along, it became apparent that the state's opportunity, if you will, to fulfill its 103 million acres was being squeezed pretty hard. That was a concern.

And of course we had numerous conferences. And I remember back in DC, trying to sit down with the representatives of the various-- and of course there were not any native regional corporations at that time. There were just a lot of native leaders from various segments of the state that were banding together on this common issue.

And we tried to sit down with Governor Hickel in the room, myself, the attorney general at that time, a number of other people, and see what was the best way we could collectively resolve the differences. Well, obviously we weren't too much in concert in those early days.

Interviewer:
Do you-- there was a question I wanted to ask and it's just slipped my mind. Now, do you recall going back to Washington several-- more than one time to discuss this problem?

Tom Kelly:
Yeah, that was during the deliberations on ANSCA. And what were the parameters, what were the numbers, what were the provisions. Of course, more than anything else was how to accommodate both entitlement, both statehood and what was emerging as the native land rights.

Interviewer:
Yeah.

Tom Kelly:
And where areas could be-- you might say where were problems could be resolved without getting into real fur fight on the thing. Those are basically what it was.

I had no direct involvement in the writing of ANSCA at that time. Because I was obviously working for the state of Alaska. And they had their own people doing the drafting. Many people who I now associate with very closely were key draftsmen to the Land Claims Settlement Act in '71.

Interviewer:
At least before you became commissioner-- I don't know by the time you became commissioner, if things may have changed. But in the early days, I think that there was a lot of discussion that the native community was looking for the right to continue to use lands that they had, that their ancestors had, for the same purposes. And that there was little talk of an entitlement to subsurface rights. Did that change-- do you recall when that changed? Did that change where you were commissioner?

Tom Kelly:
I-- like I said, that even predates my best recollection. I was in Alaska from 1958 on, but the magnitude of the native entitlement and the native land issues, the village and everything, I don't think really sunk in until the last two years prior to the passage of the act in '71. In other words, it was during my tenure. Before that time, most of the people in the community, the business community, were not aware of the, you might say, of the potential ownership of magnitude of the natives. At least I wasn't at that time. And I was involved in resource development up here.

Interviewer:
Mhm.

Tom Kelly:
But we weren't-- I don't think we appreciated the significance in the concept of the ownership of the areas, and the nature in which these were going to take place. I don't think anybody really appreciated it until we saw some of the last drafts of the bill, as was being circulated in '69, '70, and '71. That's when you can appreciate how significant the effort was.

Interviewer:
Yeah.

Tom Kelly:
By that time, like I say, we talked. And I can remember very vividly, it was pretty well resolved. Dollar-wise was no factor. I mean, when they wanted a billion dollars, I don't think that was ever an issue. The land was the issue. But in those days-- and there was an act-- when I became commissioner, I think one of the discussions we were having was the amount of acreage. And it was in the realm of four to eight million acres, as I recall at that time. Money never was a dispute on as far as how much they wanted.

Interviewer:
Let me back up for one moment again to the selections that were made in December '68 and January 69; '69, those lands under federal mineral leases. The selections were made just in those three areas, on the north slope, Copper River, and the north side of the Alaska peninsula.

Was there any discussion of making selections in other areas? I was thinking of that, especially in view of the fact that you said that leases covered such a large portion of the state.

Tom Kelly:
They were federal leases. Like I say, I was virtually-- as much as anything else, I think I was largely guided by the efforts of Pedro Denton and his staff. And the identification of those areas that were thought to be of major significance. There were leases, for instance-- and I recall, I think they were still in effect-- that covered vast areas of the porcupine drainage of areas in the Candice Basin.

Interviewer:
Yeah.

Tom Kelly:
The areas over up in the Koyukuk. Most of us, we at that time did not think was very prospective for oil and gas. So they were not there, none of the tertiary basins. The north side of the Alaska Range, we considered.

But I always did consider the area down around Port Moller. And that thing is potential. The Copper River, we didn't know. Except the fact that they had always rumored the fact that their surface gas seeps-- probably swamp gas. They only call them mud volcanoes or something up there.

Interviewer:
I see.

Tom Kelly:
So there was a concern there, and of course the knowledge of the [INAUDIBLE]. You know, we've done quite a bit of drilling up there. We had no Prudhoe Bay-- well, actually, the discovery of Prudhoe bay was in late '67. So yeah, we did have knowledge of Prudhoe Bay.

Interviewer:
Yeah. Yeah, well the state already had selections at Prudhoe Bay.

Tom Kelly:
Right. So I think, to answer your question, I just don't recall considering other areas. Although they were under-- no question about it in my mind-- they were under lease, large areas of the state.

Now why we didn't go to the-- well, we already had. We already had everything on the Kenai with exception of the Moose range.

Interviewer:
Yeah.

Tom Kelly:
So that wasn't the concern there. We had most areas in the Cook Inlet Basin Outline.

Interviewer:
That's right. That's correct. I think I only have one more question, which is when you said that you had instructed Joe Keenan to prepare selections for when the land freeze was lifted, and you mentioned that there was interest in selecting lands for hard rock minerals--

Tom Kelly:
To a lesser degree. There were some interest--

Interviewer:
Especially energy and surface values. Do you recall much discussion about specific criteria about which ones would be selected as soon as the freeze was lifted?

Tom Kelly:
We had a number of conferences here in the offices. And I had several discussions in Juneau with Hilliker, Ben Hilliker and others in the Department of Fish and Game.

Interviewer:
I'm sorry. I'm not familiar with his name, Ben?

Tom Kelly:
Hilliker.

Interviewer:
Hilliker? Do you know--

Tom Kelly:
He was deputy commissioner at that time.

Interviewer:
Hilliker, uh-huh.

Tom Kelly:
Hilliker. He was deputy commissioner of Fish and Game. And they spent-- I don't know how many man hours were spent identifying these areas. But they a lot of this stuff was information, or at least ideas, that were generated during the Egan administrations and everything else of those lands that were important.

I think some of those lands were-- well, I think from Fish and Game's standpoint, Wood-Tikchik down in that area. Mineral potential, like I say, I couldn't be totally specific as to pinpoint areas. But they had the feeling of those people who had been with the division of lands since inception.

And so there was considerable thought about those areas that were obviously, in all likelihood, would be selected, were there not some other complications.

And in view of the fact-- you see, we didn't make any attempt to go anywhere near 77 million acres.

Interviewer:
Yeah.

Tom Kelly:
I recall specifically-- 26 million rings a bell to me. That's the maximum we identified, assuming there would be still, until 25 years ran out, ample time to do so. Plus the fact that at that time, state didn't have a lot of money.

Interviewer:
Yeah. I pretty much covered all the questions that I had. Do you have anything else you want to add?

Tom Kelly:
Is this going to be in a state publication? Is that what it's going to be?

Interviewer:
Yeah, I believe it should come out in the state publication.

Tom Kelly:
On the history of the land selections?

Interviewer:
Correct.

Tom Kelly:
And how it evolved. Yeah, it'll be real good. And carrying forth, how they have come to the point now where the state now has-- I don't know, with the passage of ANILCA, what is the current conveyance?

Interviewer:
Well, I'm not sure what the state of the conveyance is. I know that the state still has something like, I believe something over 30 million acres to select.

Tom Kelly:
Oh, even to select.

Interviewer:
Yes.

Tom Kelly:
So we have a lot of conflicts I guess with the native over-selection as much as anything else.

Interviewer:
Yeah, that still hasn't been settled.

Tom Kelly:
But 30 million left to select totally.

Interviewer:
Yeah, I think that's right. I think it's more than 30 million. Well, I've run out of questions. Thank you very much for giving me your time.

Tom Kelly:
You bet. Nice talking.

Interviewer:
OK, goodbye.

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