Tourism in Katmai Country
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Wien Consolidated Airlines, which became Wien Air Alaska in 1973, operated the Katmai concession from 1968 through 1982. During that time, Raymond I. Petersen became less active in the management of the camps; perhaps as a result, investment and growth at the camps stagnated. The only major improvements at Brooks Camp during this period were a utility system, a series of docks and a floating bridge, all constructed by the National Park Service. In 1976, Petersen stepped down as airline president; thereafter the concessioner became even less willing to invest in the camps while substantially raising lodging and tour prices. The signing of a long-term concessions contract in 1981 brought an extended period of short-term contract extensions to a close, but a continuing corporate struggle at Wien brought unstable relations with the NPS and prevented the construction of a much-needed concessioner employee housing complex.

Effect of the Airline Merger on Camp Operations

The concession operations of Northern Consolidated Airlines came to an abrupt halt in February 1968, when the Civil Aeronautics Board approved its merger with Wien Air Alaska. The stockholders of both airlines approved the merger on March 9, 1968. The merger, effective April 1, was formally that of Wien merging into NCA; therefore, the surviving corporation's name, for business purposes, remained Northern Consolidated Airlines, Inc. But the new airline's operating name was Wien Consolidated Airlines (WCA), Inc., and that was the new name so far as the public and the NPS were concerned. The new airline was headquartered in Anchorage, where NCA's base of operations had been. The firm operated a system in excess of 10,000 route miles, the largest home-based carrier in the state. [1]

Ray Petersen, who had remained as the president of NCA since its inception in 1945-46, was named chairman of the board of the new airline, and Sigurd Wien was named president. In 1969, the two officers switched positions in order to allow Wien to devote more time to his personal life. Five years later Wien retired, and Petersen assumed the roles of president, chairman, and chief executive officer. The airline over which Petersen presided was known as Wien Consolidated Airlines from February 1968 until May 1973; its name was then changed to Wien Air Alaska, Inc. (WAA), out of respect for Noel Wien, the aviation pioneer. [2]

The airline that Petersen headed became the largest Alaska-based air carrier operating in the state, one which increasingly dominated the mushrooming trade between Anchorage and the King Salmon area. As late as 1957, four major airlines (Northern Consolidated, Pacific Northern, Alaska Airlines, and Reeve Aleutian Airways) connected the two points, although only the first two provided regular service. [3] In January 1959, the Civil Aeronautics Board ruled that Reeve Aleutian Airways, not Northern Consolidated, could provide revenue service to the King Salmon Airport. [4] Shortly afterward, however, Northern Consolidated service was reinstated. [5] In October 1960, Alaska Airlines dropped out of the market, and eighteen months later Pacific Northern stopped serving the route on a permanent basis. [6] By 1968, the only remaining airlines to serve the area were Western Airlines (the successor to Pacific Northern Airlines), which had a seasonal certificate over the route, and Wien Consolidated, which served the route on a year-round basis and captured the lion's share of the traffic. In February 1970, even that modicum of competition disappeared when Western Airlines, as part of a larger agreement, gave Wien a temporary exemption to provide substitute service over the route. Six months later, Western Airlines permanently suspended all service over the route. [7]

Throughout the 1950s and 1960s, Petersen and Walatka had formed an effective management team for the Katmai camps. But that close-knit friendly style of supervision began to unravel shortly after the merger took place. Petersen, as head of a major statewide airline, was not able to devote as much time to the camps as before; this was particularly true after he became WCA president in 1969. A more crippling blow took place when John Walatka died on June 27, 1970. Walatka, who had been an Alaska bush pilot for some 32 years, was well-liked by everyone he met. One NPS official described him as "indeed a friend to all of us personally, a fine fellow to work with professionally, and the type of concession manager that we like to have represent the National Park Service." [8] Petersen's eldest son, Charles, was soon appointed to replace Walatka, and by late 1971 the elder Petersen had apparently distanced himself from all direct decision making in Katmai affairs. [9]

Because of the airline consolidation, it was perhaps inevitable that the camps were going to be run on a more professional, less personal basis. When established in 1950 the camps were, in some ways, a personal reflection of the efforts of NCA president Ray Petersen, and the camps provided some much-needed visibility to the small, low-key airline. But the growth of the camps in the 1960s—to four times the revenue earned in the early 1950s—strained that personal style of management. Once the Wien merger took place, the new airline no longer needed the visibility the camps provided, and the gross revenue from the two camps in the monument still totaled less than one percent of the company's total operating revenue. [10] After Ray Petersen turned over camp management to his son, the concessioner became increasingly wary about undertaking new investment; he was also concerned about gaining a fair return on existing facilities.

Activities Under the Petersen Presidency (1968-1976)

When Wien Consolidated Airlines took over the management of the Katmai camps from Northern Consolidated Airlines in 1968, it had some relatively aggressive ideas on how it wished to develop its leasehold and fee-simple properties. It hoped to obtain a long-term lease, after which it wished to gain an airstrip and commence a substantial building program.

The National Park Service, however, favored a more cautious approach. The Service was not specifically opposed to the concessioner's building program. But its complex decision making structure, its necessity to tailor concessioner development activities within a prescribed planning framework, its demand that the independent traveler as well as the Wien lodge guest be served, and its innate sense of caution in development matters all proved highly frustrating to the concessioner. The establishment, in July 1969, of a full-time Katmai superintendent had the practical effect of exacerbating that caution, because it made permanent a new layer of decision making. [11]

As a result of their conflicting procedures and goals, and the Service's increasingly active management over camp affairs, the concessioner and the Service often clashed during the years in which Petersen presided over Wien. Some of those conflicts were based on development-versus-preservation issues; others, however, were more personal or structural in nature. By the time Petersen stepped down in 1976, the Katmai camps had changed little from what had existed in 1968. The only major change to take place was the installation of a utility system and various other small improvements at Brooks Camp.

During the first few months of operation under Wien Consolidated management, relations between the agency and concessioner were relatively placid. In December 1968, the agency invited the concessioner to submit a proposal for a long-term contract. In response, John Walatka requested a twenty-year renewal of the company's concession, and furthermore noted that WCA was willing to "invest a minimum of $300,000 in facilities at Katmai over this period of time." The investment was to be used for "the construction of a thirty to forty unit two-story, or similar size unit of single story, for housing and feeding our Katmai visitors, plus other visitor use facilities." Still hoping for a favorable resolution of its airstrip difficulties, WCA noted that "if at a later date a better means of access to Katmai becomes available, the above figure could probably be doubled or more." [12]

At first, the agency attempted to accommodate the concessioner's plans. In January 1969, regional NPS officials met to firm up their own ideas on Katmai's development needs; once completed, they would be free to negotiate a new, long-term contract. Recognizing their tardiness, they hoped to expedite the master plan process; they noted, somewhat apologetically, that "we do not wish to again be in the position of being the delaying party because we do not have our planning completed." [13] But preparation of the master plan was slower than expected, and by October 1969, just two months before the expiration of the third contract amendment, officials were obliged to ask the concessioner for a contract amendment, to be effective for the next two years. John Walatka, trying to be accommodating to the agency, asked for a contract renewal for at least a year, or until the master plan had been "finalized and accepted by all parties concerned." He commented, somewhat drily, that "we realize that considerable planning and work must go into the Master Plan, but it does seem as though this particular one has been extremely slow in maturing." [14]

Based on that response, plans were made to create a two-year contract extension. [15] Walatka died, however, before signing the document, and Ray Petersen, who supervised camp operations during the months after Walatka's death, was less amicable to a short-term contract. On July 16, 1970, the general superintendent of the Alaska Group Office, Ernest Borgman, called Petersen to offer him the two-year extension. Petersen, in response, let out a lengthy fusillade of profanity, telling Borgman in no uncertain terms that he had no intention of signing the document. He meanwhile berated the agency for its procrastination and its lack of good faith. Feeling that he had, in effect, been promised a long-term contract in return for his investments a decade earlier, he again demanded a twenty-year contract, and darkly hinted that he wished to sell his interests to the NPS if contract negotiations did not improve. Meanwhile, camp operations continued as they had in other years, even though the concessioner had no formal authorization to conduct such an operation. [16]

Taken aback by such an emotional change in concessioner attitude, regional officials tried to meet Petersen halfway. In late July, the acting director wrote that he would be willing to accept a five-year contract. He noted that a five-year contract would be awarded without the company committing itself to a development program, but a long-term contract required completion of a master plan. Given that assent, Petersen signed a five-year contract extension on August 26, 1970. [17]

Bureaucratic inertia, however, prevented the contract from becoming effective for months afterwards. The five-year commitment had apparently been approved by regional but not by Washington officials. Noting that "the master plan will undoubtedly show the need for rehabilitation, expansion and construction of concession facilities," the acting deputy director of the NPS called a five-year extension unrealistic, and instead insisted on a two-year renewal. [18] The two sides clashed for the next three months. Petersen held his ground, and in January 1971 the national office finally gave in and agreed to a five-year extension. [19] The bureaucratic machinery slowed for the next several months, but in June 1971 the concessioner agreed to a revised five-year contract extension. On August 20, 1971, Amendment No. 4 to Contract No. 14-10-0434-498 was finally signed by the National Park Service, almost three years after contract negotiations began and more than 20 months after the expiration of the previous contract. The amendment was in force until December 1974. [20]

During the late 1960s through the mid-1970s few improvements were undertaken at Katmai National Monument. The lack of a long-term contract, and the difficulties entailed in the obtaining of the relatively modest five-year extension signed in the summer of 1971, tempered any development plans that the concessioner may have entertained. The Service, for its part, refused to fund any improvements at the monument before it completed its master plan.

The master plan, in fact, took far longer than either the concessioner or the Service could have predicted. The need for a master plan had been cited as a retardant to concessioner plans as early as January 1968. [21] A preliminary working draft of the plan was not completed until August 1971. A final plan, issued in December 1973, was prepared to accompany legislative proposals resulting from actions required by the Alaska Native Claims Settlement Act. The so-called Master Plan for Katmai National Park was as much a response to statewide planning efforts that eventually resulted in the Alaska National Interest Lands Conservation Act (ANILCA) as it was a logical follow-up to the draft plan. [22]

The Master Plan attempted to make a bold new change in the direction of development at Katmai. Just as the 1953 Alaska Recreation Survey and the 1958 MISSION 66 Program proposals had done, the Master Plan proposed a geographical diversification of facilities in the monument. The 1971 draft plan proposed that the monument's major "use-node" and transportation hub should be located on or near the boot-shaped Naknek Peninsula, and that a new all-weather road should be constructed from King Salmon to the site. Research Bay (along Iliuk Arm), the Bay of Islands (at the east end of Naknek Lake), and Kukak Bay (on the shore of Shelikof Strait) were also proposed as primary development zones. All but the latter were to be accessed either by floatplanes or tour boats. [23]

At the same time, planners attempted to de-emphasize the future role of Brooks Camp. As early as August 1969, officials had stated publicly that the camp was not the best tourist center. [24] Planners felt that the developments associated with a primary visitor facility were "incompatible with climatic wilderness and [the] economic values concentrated at Brooks Camp." An additional consideration for considering an alternate location was that the camp had become prime bear habitat during the 1960s, and park planners were nervous about the increasing number of bear-human confrontations taking place in the vicinity. During the preliminary planning stages, therefore, the NPS tentatively adopted a long-range policy of eliminating Brooks Camp as a primary visitor facility, [25] and when the draft plan was announced, the principal long-range objective for the area was the reduction of the number of visitors to that area. While conceding that Brooks would "remain a popular fisherman's camp," it would remain the gateway to the Valley of Ten Thousand Smokes only until an alternate site was developed at Research Bay. Over the short term, however, planners allowed the camps to grow in a virtually unhindered manner. They intended to allow Brooks Camp to grow to a 100-guest maximum, which was "large enough to afford a profitable business operation, as well as to update the utility system and support facilities to comply with current standards and visitor needs." [26] Given such broad latitude, the concessioner was generally supportive of the draft plan; the airline, after all, had first-refusal rights over concession developments regardless of the proposed location. [27]

By the time the final master plan was issued, some of the more strident or futuristic statements regarding future use-nodes had been softened, and had been supplanted with more modest proposals. The plan noted that the park's major overnight use facility was to include lodge-type accommodations at the west end of the park. The Naknek Peninsula, however, was only one of three possible locations for that development; the other two sites were in King Salmon and on "the morainal ridge at the West End of Naknek Lake." Research Bay and Kukak Bay were also designated as primary development sites. The role of Research Bay, however, was de-emphasized, having been "tentatively selected as a possible visitor use-node," which "could become the gateway to the Valley of Ten Thousand Smokes." Regarding Brooks Camp, the strong anti-development rhetoric of the draft plan was replaced with more conciliatory language; it noted that "Further study is needed to determine the role of Brooks Camp and to stress the need of maintaining the camp's impact on the environment." The 100-guest ceiling suggested in the draft plan remained. Although the plan continued to suggest that Research Bay would eventually replace Brooks Camp as the base for bus trips to the Valley of Ten Thousand Smokes, the growing recognition that "conventional lodge or hotel-type units" were not appropriate to the vast majority of the park militated against the growth of facilities which might have supplanted those at Brooks Camp. [28]

Once the master plan had been finalized, the way was clear for the NPS to implement its provisions. The plan noted that one of the most immediate needs for park operation was a limited expansion and upgrading of Brooks Camp. [29] The final master plan had not specified the nature of that upgrading, but the draft plan's recommendation of upgrading the camp's utility system was soon implemented. The agency, in fact, had informed the concessioner as early as 1968 that utility system development would take place as soon as the master plan was completed. [30]

The NPS moved to take over the concessioner's system because of the efficiency of combining all Brooks Camp operations into one system. In the 1950s, the minimal investment the agency made in Brooks Camp buildings warranted equally minimal infrastructure expenses. But with the construction of the boathouse, warehouse and the various NPS employee cabins, the Service began to move toward combining the two systems. In November 1967, John Walatka had approached the Service regarding the matter, and within the year difficulties with the concessioner's septic system resulted in its March 1969 purchase by the agency. [31] Thereafter, in return for a fee, the NPS maintained all sewers for the concessioner except within five feet of the concessioner-owned buildings. [32]

The utility renovation project took several years to accomplish. In 1967 preliminary plans, not acted upon, were made to install a new generator house; an oil and gas house; two freight docks; fuel lines, septic tanks, and leach fields; and an aircraft landing pad. During the 1971 fiscal year a more comprehensive utility renovation project was planned, and construction was initially budgeted the following year. [33] In January 1973, the NPS issued a notice for bids for the project. Specifications included the construction of new water, sewerage, fuel storage, and electrical systems; in addition, the project called for the erection of new boat docks, landfill fencing, and a fish cleaning station. The $590,000 project was issued to the R.D. Peterson Company (no relation to former Ranger-in-Chief Robert Peterson), which commenced work in May 1974. The contract was completed by October 1975. [34]

In addition to a new fish cleaning shed, the contract resulted in the construction of two other buildings at Brooks Camp. The nerve center of the project, the 16' x 40' utility building, was located at the north end of the row of NPS employee housing units. In addition, the contractor erected a bunkhouse for its employees midway between the concessioner's Skytel and the NPS warehouse. [35] The bunkhouse was later converted to alternate uses; during the summer of 1977 it became the NPS visitor center. Evening talks and other interpretive programs were moved from the lodge to the new facility that year; they have been provided in the building, now known as the auditorium, ever since. [36] The new visitor center, and the creation in 1974 of a nature trail which led to and encircled the beaver pond located one-half mile south of Brooks River, were the only significant improvements to the monument's interpretive program during the 1970s. [37]

The construction of an improved dock was included in the contract to provide a safe anchorage for planes at Brooks Camp, and to better service the boat traffic crossing the Brooks River. Boats, of course, were a less-than-ideal method of crossing the river, and to overcome that handicap, two different planning studies in the late 1960s called for the construction of a footbridge. [38] By 1971, a Brooks Camp design directive noted that "a solution to the crossing of this river is necessary if the present concession bus operation continues." The draft version of that directive offered a more specific solution. It noted that "a trail bridge has been suggested to cross the Brooks River ... to transport fishermen, sightseers, supplies and solid waste across the river. The bridge width shall be limited to six feet in order to exclude conventional vehicles." It then proceeded to describe, in some detail, suggested locations and materials for the proposed bridge. A total of $176,000 was budgeted in the 1972 fiscal year for bridge construction.[39]

No bridge was built, however, as a result of the design directive. The dock construction effort of 1974-75 (which, like the bridge, had also been considered in the planning studies of the late 1960s) was a tacit admission that bridge plans had been indefinitely delayed. On the north side of the river the short, linear dock which had existed since the early 1960s was expanded. That dock was lengthened from approximately 40 feet to 60 feet. In addition, a 68-foot extension was built on the west side of the embayment, and a 173-foot extension added to the east side.[40]

Most of the investments Wien made during the years of the Petersen presidency took place between late 1971 and 1974. This is not surprising, inasmuch as this was the effective period of the five-year contract. Investments within the national monument resulted in the replacement of existing equipment rather than in improvements to the physical plant.

Through much of the 1960s NCA had relied on the Pilatus Porter, along with an occasional Cessna, to carry visitors between King Salmon and the various camps. By 1970, Wien Consolidated had inaugurated use of a larger (11-passenger) Grumman Mallard floatplane.[41] The company found it so well suited to the service that by 1974 it set aside its other craft for the next several years.[42]

Another change the carrier undertook in 1974 was to abandon its charter business within the monument. Through the early 1970s Wien had stationed a small aircraft in the Katmai area that was available for charter side trips. But the company had been reducing its nonscheduled service for a decade, and it sold the last of its single engine aircraft in 1973. The following spring it petitioned the National Park Service to allow a new airline, Katmai Air, Inc., to provide air tours of the area and fly-out fishing trips. Katmai Air was owned and operated by Raymond F. Petersen, son of the founder of the Katmai camps.[43] The Service applauded the services which Katmai Air could provide to the visitors of Brooks Camp and the other local destinations. But a regional official noted that "a circumstance such as this does not fit in with the service's policy," and Petersen was instead encouraged to apply for an NPS Special Use Permit. He operated on the basis of that permit for the next eight years.[44]

Before he began Katmai Air, the 22-year-old Petersen had become familiar with camps both inside and outside of the monument. He grew up around the camps, learned to fly in 1968, and worked for five summers as a fishing guide at Kulik and Brooks lodges.[45] In 1974, when Katmai Air began, a popular guidebook to the monument noted that it was the only carrier stationed in Brooks Camp. Fishermen, however, had far greater need for aircraft charters than did tourists on three-day tours. Petersen himself, therefore, noted that his primary responsibilities in his first year were to provide pilot and guiding service for Kulik Lodge (the largest Wien-owned fishing lodge), as well as support for the other lodges. By the end of the decade, his operation had grown considerably, but most flying took place out of Kulik and Grosvenor camps, not Brooks. [46]

Kulik, rather than the camps in the monument, witnessed the construction of new improvements in the early 1970s. Personnel there used the on-site sawmill to construct an addition to the garage. Then, about 1973, the sawmill was dismantled. In the mid-to-late 1970s, one or more Panabode cabins were erected at the camp. [47]

During this period, the airline was finally able to legalize its use to the eastern portion of the Kulik Lake Airstrip. In 1967, protests from Native organizations had prevented the company from obtaining a lease for the 75 acres of airstrip located on public lands. The protest remained in effect until the Alaska Native Claims Settlement Act (ANCSA) was signed by President Richard M. Nixon on December 18, 1971. The passage of the act cleared the way for the company to obtain its lease, but it was not until October 1973 that the applicant, which by now had become Wien Air Alaska, was informed that the BLM was able to resume processing the case. [48] Wien responded to the reopening of the case file by providing documents to the BLM which showed its legitimate right to the original NCA application. Finally, on February 5, 1974, the agency granted the airline Public Airport Lease A-056478. The lease, which was not obtained until twelve years after submission of the original application, was effective for a twenty-year period. [49] The creation of the lease did not change usage patterns at the strip; the airline continued, despite scattered protests from the public and BLM officials, to prevent landings from anyone not connected to the lodge operation. [50]

Changes also took place in the vehicles used on the day trip out to the Valley of Ten Thousand Smokes. Through the 1960s, NCA had relied upon a 16-passenger bus and an eight-passenger Chevrolet van. In the late 1960s the bus was replaced by a 1960-vintage 40-passenger bus. [51] The larger bus, however, was unable to withstand service along the valley road for long. By 1973, it was suffering from broken windows and questionable brakes. The following year was worse; transmission repairs idled the bus for part of the season, and as the summer wore on the springs wore out and the brakes again became unsafe. [52] The concessioner responded by purchasing two new Dodge maxi-vans. The large bus, however, was not immediately mothballed; it saw sporadic service for the next three years. [53]

During 1975 and 1976, the last two years of Petersen's presidency, few improvements took place at the camps. The five-year contract signed in August 1971 terminated in December 1974, and was to be the last long-term pact signed during the decade. Correspondence relating to the creation and implementation of new contract extensions was a near-constant activity for the next several years. The period was, in many ways, a confusing stalemate because the growing complexity of park operations delayed the issuance of contract renewals. The concessioner, for its part, showed an increasing reluctance to provide services that did not provide an assured return on investment.

In the spring of 1974, negotiations began on the issuance of a contract to succeed the one due to expire that December. On April 17, the Associate Director of the NPS asked that the concessioner request a renewal. [54] Chuck Petersen, a Wien Vice-President and the eldest son of Raymond I. Petersen, responded by requesting a five-year contract extension.[55] For the next several months, however, negotiations languished because the NPS had to await the completion of an environmental assessment for the proposed concession contract. The assessment, which offered three scenarios for concession development at the two camps, was not particularly controversial, because both the concessioner and the Service were comfortable with a five-year contract renewal, which called for no particular capital improvements during the life of the contract.

The study, however, was not finished until the end of October. By the time officials in Washington could comment on the matter, time had run so short that the contract had to be extended "for at least one year" instead of the five originally proposed. [56] The concessioner, apparently content with the recent turn of events, agreed to a one-year extension in January 1975. Because of unknown delays, however, Wien operated its camps that summer without the benefit of a signed contract. The concessioner signed Amendment No. 5 to the 1961 contract on June 26, 1975. The agency did not sign until November 6, less than two months before it was due to expire. [57]

Negotiations for the following year's contract extension began almost as soon as the former extension was signed. Fortunately, they were neither as fractious nor as protracted as those for former extensions. The concessioner was in no mood to invest further in the camps, and the Service apparently felt that short-term extensions were appropriate for stand-pat operations. [58] Both parties, therefore, were comfortable with a one-year contract. On March 11, 1976, the concessioner was informed that a one-year extension was in the works, and by the end of the month Amendment No. 6 had been prepared and signed by Chuck Petersen, an assistant vice-president for Wien Air Alaska, Inc. An NPS official signed it on April 22. [59]

Despite the continuing sense of frustration the concessioner must have felt with the issuance of short-term renewals, relations between Wien and the National Park Service remained surprisingly good during the early and mid-1970s. The Service was generally pleased with the level of service Wien provided to Katmai visitors. It continued to rate the concessioner positively during periodic evaluations. [60]

Key to the master plan process of the early 1970s was the implementation of commercial boat access into the monument. NPS officials considered that the creation of tour-boat service across Naknek Lake was of high priority, because it provided the potential for dispersing recreation uses and access into the monument by those other than the concessioner. [61] NPS officials at the time predicted, in fact, that tour boat would replace aircraft within the next few years. [62] But the logistics and expense of setting up a marine operation militated against its implementation, and without the creation of a deep-water port on the north edge of Naknek Lake, formidable physical factors prevented start-up of such a service. [63] As one observer noted:

During times of low water only boats with a very shallow draft can complete this trip [to Brooks Camp]. Transporting people in this manner would require large boats and this does not appear to be feasible without dredging and consequently disrupting very important fisheries resources. It is considered that the cost of purchasing, operating and maintaining such boats would also be prohibitive. [64]

Despite those barriers, the concessioner investigated the economic practicality of such a service during the summer of 1976. The airline had been relying on the Grumman Mallard to access Brooks Camp for the past several years, but had recently found the craft so uneconomical, and so unequal to the task of transporting an ever-increasing number of tourists, that it cast about for an alternative. [65] Its consideration of marine craft, however, was brief. The airline substituted other aircraft for the Mallard, and the idea of instituting boat service on Naknek Lake has not been seriously considered since that time. [66]

Events During the Early Flood Presidency (1976-1979)

On September 28, 1976, newspapers announced that Ray Petersen was stepping down from the presidency of Wien Air Alaska. His replacement was James J. Flood, a member of Wien's board of directors, a 15-year Alaska resident and the former head of the Alaska Brick Company. Flood, chosen after the airline conducted a nationwide search, also became the chief operating officer, while Petersen remained as chairman of the board and chief executive officer. Petersen, at 64 years of age, chose to retire after almost a half-century of work. He had headed an aviation company, of one size or another, for more than four decades. [67]

The announcement had been anticipated for some time, and had little to do with the operations of the Katmai camps. Wien, indeed, needed new leadership. The company, for instance, had failed to gain an appropriate share of business from the pipeline boom, had not been able to successfully merge with a larger carrier, and had poor relations with its employees in labor negotiations. Perhaps as a result of each of these factors, the company's stock had lost more than 70 percent of its value in the last two years. Underlying the company's difficulties was the perception that the company had deep-seated management problems, and that more enlightened leadership was needed. [68] In retrospect, Petersen has recognized that the merged airline had been an imperfect fit at best, a clash of two separate business philosophies, and that the troubles which beset the airline stemmed from the inability to mesh the management goals of the two former airlines. Petersen's operation of Northern Consolidated had been consistently profitable, but he was not able to duplicate that success after the merger. [69]

Whatever the reasons for the changeover, it meant that Petersen, for the first time in more than 25 years, had lost management control of the Katmai camps. His tenure had been remarkable. He had dealt with some fourteen seasonal park rangers or management assistants, seven superintendents, eight regional directors, and six NPS directors. [70] While Petersen, as WAA president, had been divorced from camp operations since 1971, his influence had continued through his son Charles, who managed the camps from 1971 until May 1977. During the six seasons after Charles' departure, the only member of the Petersen family involved whatsoever in the camp operations was Raymond F. Petersen, who provided air taxi and flightseeing service. [71]

During the seven-year period in which Flood presided over the Katmai camps, the concessioner initiated relatively few site improvements, and no new activities were developed. Wien showed a continuing reluctance to undertake investments that did not offer a guaranteed return; once, in fact, the airline pointedly refused to replace obviously deteriorating equipment. The NPS during this period made several investments of direct benefit to the concessioner; the extent of those investments, however, was relatively modest. Although the agency and concessioner ironed out a 15-year contract during this period, negotiations preceding that contract were often antagonistic. Tension, in fact, characterized much of the relationship between the two parties in the late 1970s and early 1980s.

Relations between the NPS and Wien Air Alaska were tentatively optimistic during the waning months of the Peterson presidency. During the early summer of 1976, Park Service officials hoped that they could engineer a five-year extension of the 1961 contract. Between early July and mid-August, NPS officials at the national and regional levels seemed firmly committed to a five-year term. (Such an extension would have guaranteed Wien continued camp operations without having to undertake a construction program.) [72] But on August 21, an incident took place on Lake Grosvenor which demonstrated the lack of trust between the agency and concessioner. It strained relations between them for months afterwards.

On that date Van Hartley, the fishing guide at Grosvenor Camp, took a party of fishermen via jet-boat to the east end of the lake, at the mouth of Hardscrabble Creek. Hartley, who had worked out of the camp for less than a season, failed to slow down sufficiently in the shallows and went aground. Superintendent Gil Blinn, along with his son and an NPS employee, were canoeing in the vicinity, and offered to help. Using a block and tackle, Hartley and the NPS employees freed the jet boat. Hartley admitted only later that two of his party had sustained minor injuries in the grounding. [73]

The superintendent dutifully filled out a case incident record of the event, but before long an obviously embarrassed Hartley began to complain that the NPS employee with Blinn had refused to provide help in extricating the jet boat. Hartley also accused Blinn of refusing to provide first aid to the injured fishermen. Blinn denied both charges. [74]

Tempers eventually cooled from the incident itself, but a more vexing problem was the legality of motorboat access at the east end of Lake Grosvenor. Back in 1971, hearings had been held on the issue in conjunction with proposed wilderness designation at Katmai. Ray Petersen, representing Wien Consolidated, testified in support of much of the Service's proposed plan. Hoping to support the status quo, however, he also lobbied to keep Coville and Grosvenor lakes upon to power boating. [75]

In 1974, the NPS issued a Final Environmental Statement (FES) for the proposed wilderness at Katmai. That document proposed that the use of motorized boats be banned on all but the western end of Lake Grosvenor. (A major reason NPS officials made this decision was because the so-called Savonoski Loop was a popular canoe route. They felt that the popular canoeing route needed to be restricted to non-motorized craft in order to better maintain a wilderness setting.) The FES noted that "under existing administrative regulations," the use of power boats anywhere on Lake Grosvenor was not permitted. [76]

Superintendent Blinn did not immediately begin to enforce those regulations; by 1976, however, he felt that it was time to do so, at least in regards to Lake Grosvenor. He made no announcement; instead, according to the head of the concession operation, Blinn began to voice displeasure with motorboats on the lake "in late July or early August." It was not until September 1, ten days after the jet boat incident, that he officially notified the concessioner that it was operating in violation of park regulations. [77] At the end of an otherwise routine meeting, Blinn announced the new policy, effective immediately. His basis for the new policy, he noted, was not the Proposed Wilderness Environmental Statement. Instead, it was administrative regulations, implemented as soon as the environmental statement had been approved, which mandated that proposed wilderness areas be managed as "de facto" wilderness pending Congressional approval. [78]

Chuck Petersen, Wien's representative in charge of the camps, responded to the decision by writing a vociferous, lengthy letter of protest. He accused the superintendent of being arbitrary and evasive, and appealed his case to Pacific Northwest Regional Director Russell Dickenson, NPS Director Gary Everhardt, and Alaska's Congressional delegation. He then notified several of Grosvenor Camp's longtime guests of the decision, and organized an informal lobbying effort to overrule Blinn's administrative regulation. [79] The lobbying effort worked. By January 7, 1977, Director Everhardt notified Petersen that it would allow the use of motorized boat service, pending action by Congress on wilderness recommendations. [80] (That usage has continued to the present day. ANILCA, passed in December 1980, gave Congressional approval to the administratively-designated Katmai wilderness. Section 1307 of the act, however, ensured that services that were active on or before January 1, 1979, could continue to operate if they were "consistent with the purposes for which such unit is established or expanded." Katmai staff have interpreted that motorboat usage on the lake has been consistent with the intent of that section.)

In retrospect, the furor over the issue could have been avoided. The superintendent's decision to enforce wilderness regulations in mid-season, shortly after an incident in which he was personally involved, appears ill-timed. Instead, he could have either announced the change in policy before the season began, or soft-pedaled the August 21 incident and delayed a more long-term policy decision until the end of season. Either way, he would have given the concessioner an opportunity to respond, protest, and perhaps work out a compromise. Given the fact that the concessioner had been using motorized boats on Lake Grosvenor since the early 1950s, it is doubtful that Wien would have readily acceded to the new regulation. But the company's use of the east end of Lake Grosvenor was sufficiently light that economic rather than emotional arguments might have prevailed. The concessioner, for its part, was also not blameless. Wien personnel were more emotional than rational in their description of the original incident which resulted in the superintendent's enforcement action. But its emotional protest to the new regulation, and the letter-writing campaign which followed, were justifiable measures in that their sole purpose was to protect existing conditions. [81]

The difficulties in resolving the dispute arising from the jet boat incident effectively stalled negotiations on the contract renewal for some six months. Neither side discussed matters relating to the contract until late February 1977, when a regional official told the Washington office to proceed with a one-year extension, followed by a new contract to be effective in 1978. [82] But by March 25, the contract extension advertised in the Federal Register had been expanded to two years. [83] John Nelson, Wien's assistant vice president of properties, signed Amendment No. 7 on June 13, 1977; by the time the National Park Service signed it on September 21, the summer season was effectively over. [84] The late date at which the NPS signed the extension and the lack of concern which either side expressed at the tardiness of the contract underlined the long-term interdependence which had developed between the concessioner and the agency. The summer of 1977 was the fourth season that decade in which the concessioner had operated the camps, for all or part of the season, without the benefit of a valid contract. It would not be the last year in which an unfinished contract extended into the camps' operating season.

The 1977-78 extension was the only contract between 1974 and 1981 which lasted more than a year. As such, it created a rare six-month hiatus in correspondence relating to contract matters, and allowed both the Service and the concessioner to concentrate more fully on other matters. The concessioner made few efforts to initiate camp improvements during this period. The NPS continued to make small, incremental improvements.

One of those improvements was the elimination of long-festering problems related to garbage collection in the Brooks Camp area. In the early 1970s, the NPS had instituted guidelines prohibiting garbage from being left in outside barrels and mandated that all garbage be burned before dumping. [85] Because of the difficulty in carting it to the dump along the Valley Road, garbage continued to be burned at the dump just west of the NPS maintenance buildings at Brooks Camp. The NPS burned garbage there until 1976; after that time, the dump continued to attract bears. [86] In July 1979, NPS officials responded to the problem by covering up the Brooks Camp landfill. Both the Service and the concessioner began to compact rather than burn their garbage. A barge hauled the garbage to Lake Camp, from which trucks removed the refuse to the Naknek dump. This system continued in use until 1991, when the construction of an incinerator reduced the volume of refuse that had to be removed from the camp. [87]

The Service also had to contend with changes to its docks. In 1974-75, as part of the contract resulting in the new utility system, the Peterson Construction Co. had built a U-shaped dock on the north bank of the Brooks River which spread across all three sides of the embayment in which it was located. On the river's south side, boats continued to use a dock which had been in place since the early 1960s.

But no sooner had the new dock been installed than nature began to unravel the improvements. In 1977, high runoff caused the area surrounding the original concessions camp to flood, and continuing erosion threatened to undercut and destroy the new dock. The following year, NPS maintenance personnel dredged out the boat moorage area and tried to restore the dock to its former appearance. But in 1980, early runoff once again gouged under the north end of the dock and continued on into Naknek Lake, thus turning the embayment into a northern arm of Brooks River. The east side of the dock, by now severed onto an island, was manually removed in late May. The north side of the old dock, which was now protruding into Naknek Lake, was buttressed with scrapped sections of the former eastern portion of the dock. It began to serve as an impromptu fishing platform. [88]

The floods which had so greatly impacted the recently-completed dock on the north side of the river also played havoc with the older dock on the opposite bank. By 1978, floods had so weakened the small, L-shaped south side dock that NPS maintenance personnel had to dismantle it. It was not rebuilt. [89]

The elimination of the two docks, of course, complicated access across Brooks River. Until 1977, crossing the river had been fairly easy because of a reliance on motorized skiffs. The deterioration of the docks, however, made dockings more tenuous as new landing sites were sought. In addition, the noise and fumes of the motorboats—noted by at least one Brooks Camp visitor—and a national policy of greater energy conservation encouraged NPS personnel to pursue alternate methods by which visitors could cross the river. [90]

The first attempt was the installation of a boat pulley system. Raul Yoestrom, a seasonal ranger, designed and installed a makeshift system during the summer of 1978. The system, however, did not work well enough to be considered for more permanent use. [91] Edward Stondall, the maintenance chief at the Alaska Area Office, felt that a pulley system would not work over the long term, and suggested that a floating, removable bridge offered greater possibilities. Stondall designed the bridge during the 1979 summer season. Once the necessary approvals were gained, the bridge was constructed in 1981-82 with funds obtained from the Park Restoration and Improvement Program. [92]

The only other improvements were the addition of several new support buildings. At Brooks Camp, three Panabode-style seasonal ranger cabins were erected during the summer of 1980. These replaced four tent-frame residences which had been laid out in 1967. [93] The only structure put up by the concessioner during this period was a combination bath house and laundry building, erected at Grosvenor Camp about 1981. [94]

The end of the decade also saw a fundamental change in the way visitors reached Brooks Camp. Between 1950 and 1978 almost all Brooks Lodge visitors, along with most independent travelers to Brooks Camp, had arrived from King Salmon on the aircraft operated by the concessioner. But Wien Air Alaska, the concessioner after 1973, wanted to de-emphasize its use of small planes. The company had abandoned its charter operations in 1974, and in late 1978 it leased its Brooks Camp service to Peninsula Airways, a local service airline which had been serving Brooks Camp on a charter basis for several years. [95] Peninsula, known locally as "Pen Air," obtained a special use permit from the National Park Service for the summer of 1979. Using Grumman Widgeons, a Grumman Goose and other aircraft, it provided the primary means of access to Katmai through the 1987 season. [96]

Despite the above changes, the concessioner's primary concern between 1978 and 1982, as it pertained to the operation of the Katmai camps, revolved around its attempts to obtain a long term contract and to extract a greater profit from camp operations. To attain these goals, Wien plunged into a number of financial negotiations, with both the National Park Service and with its own successors and/or subsidiaries.

Negotiations for a long-term contract began in early 1978, some nine months before the expiration of the two-year contract. The Service, as it had several times before, initially hoped to obtain a new contract. [97] These early hopes, however, proved premature. When the agency and the concessioner met in April 1978 to discuss such a contract, a series of disagreements between the two parties led the Service to recommend that the existing contract, initially signed in 1961, be extended for one more year. [98] Wien officials were in no mood to rock the boat, so on October 16, 1978, the company signed Amendment No. 8 to Contract No. 14-10-0434-498. The NPS signed the amendment six months later, on March 20, 1979. [99]

Of the various concerns raised in the April 1978 meeting, one of the thorniest related to housing for the Wien employees at Brooks Camp. Since the 1960-65 period, when NCA had constructed its Panabode-style units, Wien employees had been the primary users of the framed tents which were located between Brooks Lodge and the mouth of Brooks River. Several of these tents had been in place since the establishment of the camp in 1950. The Service had raised concerns about the adequacy of these tent cabins as early as 1974, when the construction of a new employee camp had been urged in exchange for the adoption of a ten-year contract extension. Wien, at that time, was not so eager to obtain a long term lease that it was willing to commit itself to a major construction program; therefore, that option was not exercised. [100] Four years later, the company showed no more willingness than before to allocate funds for the project, and the project was tabled again. In the meantime, however, the floods of 1977 had shown the vulnerability of the site, and the increasing number of encounters between humans and bears in the area raised the concerns of park officials. [101]

Even before Amendment No. 8 was officially put into effect, negotiations began again for a new ten-year contract. [102] This time, Wien officials were more amenable to the idea of a new concession housing area. However, Federal officials took more than a year, from March 1978 to December 1979, to prepare the contract. Despite the delay, the agency and concessioner continued to work toward resolution of a long-term agreement. By March 1980, both parties recognized that one more year-long extension would be necessary to bridge the time before a final contract could be hammered out. [103] Accordingly the two parties met and quickly ironed out their differences. On March 25, 1980, both parties signed Amendment No. 9 to the 1961 contract. [104]

Household Finance Takes Over, 1979-1982

In July 1979, while contract negotiations were stalled, Wien made a move which had the long-term effect of straining relations with the National Park Service. Wien's board of directors announced that the airline was on the market, and Household Finance Corporation (HFC) and Alaska Airlines soon emerged as the major competitors for ownership. In mid-September, after several months of wrangling, Household Finance Corporation emerged victorious. The chairman of HFC was Gil Ellis. Wien, one of many HFC subsidiaries, remained as the holder of the concession. [105] It took several months for HFC to impose its management style over the Wien operation. Events were to demonstrate that Wien, after the HFC takeover, was even less likely to invest in the camps than it was beforehand.

The obstinacy of Wien's new management began to be demonstrated as early as the spring of 1980. As noted above, several minor differences remained to be discussed before Amendment No. 9 was signed, and the largest area of contention dealt with the vehicles which the concessioner used for the Valley of Ten Thousand Smokes tour. The two Dodge vans used on the tour, which had been purchased in the fall of 1974, were recognized as being in poor shape even in the spring of 1979. The concessioner, despite the condition of the vehicles, demanded a sharp increase in the price of the day tour; the Service responded by allowing the increase, but only if Wien purchased a new vehicle. Despite its promise, Wien refused to uphold its end of the bargain. [106]

In the spring of 1980, the agency repeated its demands for a new vehicle during negotiations for the contract renewal. In response, a Wien official replied that it was planning to offer a flightseeing tour (through a contractor) of the Valley of Ten Thousand Smokes. As a consequence, no new buses would be needed because of the reduction in patronage. The official also promised that Wien would overhaul its buses before the tourist season commenced. [107]

Confronted with this announcement, the director of the Alaska Area Office, "with great reluctance," allowed the contract extension without the purchase of a new vehicle. But the Katmai superintendent, David Morris, was opposed to Wien's shift in marketing strategy. Morris cried foul, charging that the air tours, which provided Wien greater revenues than the bus tour, were a violation of the jointly signed concession operating plan. As de facto spokesman for the independent traveler, he also feared that the de-emphasis on the bus tour would endanger the travel options of those who were not lodge guests. Morris, as it turned out, had good reason to worry. Wien raised the cost of the valley tour for the second straight year and again refused to upgrade its equipment. [108]

Considering the condition of the valley road that summer, it was perhaps fortunate that air tours were available. Katmai Air Service, the carrier which had begun as a charter outfit in 1974, operated under a contract to Wien that summer, and pilot Dan Bail provided 75-minute flights over the Valley of Ten Thousand Smokes to some 800 tourists. [109] The bus tour was not as successful. The number of tourists, to be sure, was substantially reduced because of the air tour option. In addition, high water on Margot Creek closed the road from June 3 to July 23. Flooding forced the valley tours to be cut back to half a day; the buses on those trips turned around at either the first or second stream crossing. [110]

The concessioner ceased its promotion of scenic flights over the Valley of Ten Thousand Smokes after the 1980 season. But despite the objections of the agency, the company continued to delay its bus purchase for another two years. The lack of improvements, however, did not prevent price levels from continuing their escalation. By 1982, the cost of the bus tour (with lunch) had risen to $45, almost four times as much as had been charged just eight years earlier. Given the fact that it was a period of relatively high inflation—the nation's consumer price index rose more than 90 percent during those years—the bus fare increase was still substantial. [111]

Regarding the Kulik Lake Airstrip, the late 1970s and early 1980s witnessed the gradual softening of attitudes toward public use. From 1959 through the mid-1970s, the various owners of the western half of the strip (NCA, WCA, and WAA) had successfully prohibited its use to all but a few outsiders. But by the late 1970s, so many parties had complained to the BLM about the exclusion of the general public that a BLM employee, David Mobratten, was asked to investigate. According to his findings, Wien claimed that the airstrip was private because a clause in the lease permitted "the use of the airfield by any aircraft under emergency conditions." But Mobratten found that the clause was "redundant and meaningless," and that the private use of the airport "would seem to violate and contradict the terms and conditions of the authority under which public airport leases are granted." He recommended that the lease be canceled if Wien did not allow public use of the strip. [112]

A branch chief, however, backtracked somewhat on that position. Neil Bassett felt that "for us to insist that the entire strip be made public puts us in the illegal position of dictating use of private lands and possibly of a 'taking' without compensation, not to mention tort claim problems." He instead recommended that Wien be issued a "Show Cause" notice, providing for cancellation of the lease for violation of the lease terms relating to public use. [113] For whatever reason, however, no such notice was sent, and the matter remained unsettled for the time being. [114]

After the National Park Service, in December 1980, obtained title to the eastern half of the airstrip, agency officials began to more strongly demand that the public be allowed to use the airstrip. This time, Wien was more conciliatory. By April 1982 James Flood, Wien's president and chairman of the board, told the Service that "Wien recognizes and understands the right of the public to use the runway ... located on federal land covered by the above described lease, as required by the lease itself and 49 U.S.C. §211." [115]

Creation of the New Concession Contract

The obstinate attitude which Wien showed toward its purchases of capital equipment continued during its negotiations with the National Park Service on a new contract. As noted above, the two sides had agreed on an interim, one-year contract during the spring of 1980. Negotiations for a long-term pact began even before Amendment Number 9 was signed. They continued through the spring of 1981.

The National Park Service began to prepare a prospectus for a long-term contract in the fall of 1979. It originally envisioned one lasting ten years, but when the prospectus was issued on April 18, 1980, the contract period had been lengthened to 15 years. [116] The document was published in the Federal Register and delivered to Wien. During the 30-day review period, however, Wien's representative in charge of the camps, Morgan Richardson, "simply overlooked" the matter, and no other party responded to the prospectus within the designated time frame. By its failure to respond, Wien lost its preferential right of renewal. [117]

Hoping that a level playing field might entice a greater degree of interest, the NPS issued a second prospectus on August 21, 1980. Wien, the existing concessioner, was provided a hand-delivered prospectus the same day. The agency gave interested parties until October 15 to respond to the prospectus. [118] During the period that the second prospectus was out for bid, the NPS openly encouraged Wien to respond. Wien's representative, however, was in no mood to be prodded. He waited until nine days after the closing date before he responded.

Wien was the only firm to bid for the new contract. A four-member ad hoc panel, convened on November 3 and chaired by AAO official Richard Stenmark, found that the offer was "conditionally responsive" to the prospectus. The two parties, however, did not agree on several key points. The agency, for instance, wanted to substantially increase the franchise fees, because the $900 fee being paid at that time was less than one-fifth of one percent of gross revenues. Wien offered a $100 fee increase; as an absolute limit, it was willing to double it to $1800.

NPS officials, however, felt that Wien should pay a percentage of gross profits rather than a flat fee. As far back as May 1974, the NPS had used concession management guidelines developed from Public Law 89-249 (passed in October 1965) as the primary basis for new contract fees; at Katmai, officials calculated that any new contract should include a 1.2 percent franchise fee. Between 1974 and 1980, any discussion of a new contract included either a 1.2 or 1.25 percent fee. (The latter figure was offered as an initial bargaining position.) [119] Therefore, Wien officials should not have been surprised that the 1980 prospectus included a 1.2 percent fee. But company officials fought the new rate because, based on 1980 revenues, it would have been approximately $5900—over $4000 more than the airline was proposing. [120]

Another source of tension indicated in Wien's response to the prospectus concerned the construction of new housing for the employees of the concessioner. Since the 1950s, Wien employees had lived in a series of framed tents near the mouth of Brooks River. Guests had shared adjacent tent frames in the early years, but after the construction of the Panabode lodge units during the 1960-1965 period, guests stayed less often in the former tent frame complex. By the early 1970s the tents were no longer considered as guest cabins. By 1974, the land surrounding the cabins was recognized to be subject [121]to periodic flooding. The condition of the cabins had deteriorated to such an extent that the NPS proposed their replacement as part of the granting of a ten-year contract. [122] The floods of the late 1970s, noted above, served only to underscore the need for new employee dwellings. In 1979, the NPS approached the problem more directly when it drew up its first development concept plan for Brooks Camp, the primary purpose of which was the removal and replacement of the existing concessioner housing.

When contract negotiations began in 1980, NPS officials repeated their stipulation that any new contract include a provision for replacing the employee housing complex. Wien officials, however, responded to the Service's housing demands with only vague replies. The company had estimated that the construction of a new employee complex would cost more than $600,000. Therefore, they were in no mood to undertake such a large investment. [123]

To iron out these and other differences, officials from Wien and the newly designated Alaska Regional Office of the NPS met on December 5. The meeting was inconclusive. Wien officials, who were now part of Household Finance Corporation, stated matter-of-factly that new company guidelines required a 15 percent after-tax return on invested capital. The two Katmai concession camps, in fact, had provided a return exceeding 15 percent during 1977 and 1978 seasons. In the two years since the HFC takeover, gross revenues had continued to increase, but camp expenses were reportedly so high that the company showed negative net income figures. [124] The lack of profits, combined with the rigid guidelines imposed by HFC, prohibited Wien from investing in employee quarters, and the company was equally uninterested in the prospect of purchasing new buses for the Valley of Ten Thousand Smokes tour. Wien, in fact, told NPS officials that it was on the verge of "cashing out" its investment. The two sides were hopelessly deadlocked but agreed to meet again in an attempt to resolve their differences. [125]

The two sides met again on December 16. By this time Morgan Richardson, the previous Wien representative in charge of the camps, had been replaced by Ralph Stemp; apparently as a result of the personnel change, agency officials found Wien more willing to negotiate a contract than at their first meeting. The two sides, however, remained substantially at odds regarding franchise fees, the construction of employee quarters, and the purchase of new buses. [126] After the meeting, the stance of Wien officials reverted to that shown at the December 5 meeting, and when the two sides met at a hastily-arranged third meeting on January 23, 1981, Wien officials again suggested the possibility of being "cashed out." NPS officials responded by threatening to terminate the process if an agreement could not be reached before February 9. (This deadline was later extended to February 23.) [127]

At this point the situation looked bleak for both sides. Wien was on the verge of abandoning an operation which had been under continuous airline management for more than thirty years. The NPS faced the equally dismal prospect of having to go without an active concession operation—an operation responsible for bringing a large share of Katmai's visitors and providing a quality experience to thousands of its guests.

Confronted with the prospect of breaking their long-established working relationship, the two sides appealed to each other for an equitable compromise. Ralph Stemp, the company's new camp representative, was apparently given a wide latitude by company management to hammer out an agreement; NPS officials, though legally bound to follow Servicewide contract language to a large extent, worked toward the same goal. Stemp, overseen by Wien president James J. Flood, negotiated with Concessions Management Officer Joe Alston, Associate Regional Director Robert L. Peterson, and Regional Director John Cook. [128]

By early May, the two sides had agreed to a proposed contract. Wien still had concerns on matters related to the length of the tourist season, maintenance of the Valley of Ten Thousand Smokes road, and the ability to construct new guest cabins at Brooks Camp. These problems, however, proved not to be insurmountable, and on June 4, 1981, Wien Air Alaska signed Contract No. CC-9100-1-0001, valid through the end of 1995. The National Park Service signed the contract on September 25. [129]

At the insistence of the National Park Service, the contract mandated a series of improvements at both Brooks and Grosvenor camps. It called for the replacement of all concessioner employee housing units at Brooks Camp. It also required the replacement of the existing Brooks Camp store and lounge (also located in the tent complex), the construction of an addition to the Brooks Camp dining room, and the replacement of the kitchen and dining room at Grosvenor Camp. Finally, it mandated the replacement of the current tour buses with a fleet sufficient to meet visitor needs and road conditions. A timetable giving dates by which each of the improvements was to be completed was incorporated into the contract. [130]

The first scheduled improvement, which was the replacement of the tour buses, followed soon after the contract was signed. The 1974 Dodge vans were in a ramshackle condition by the end of the 1981 season. To remedy the situation, Wien bought three new eight-passenger Chevrolet Suburban vans that winter. Placed into service at the beginning of the 1982 season, they were readily accepted by Katmai visitors. [131] Other amenities also began to improve. The quality of concessions employees, which had been questionable at best during the late 1970s, rose dramatically during the early 1980s. The camp's appearance also improved as with the removal of collected oil drums and related camp refuse. [132]

Household International Moves to Sell the Camps

During the winter of 1981-1982, various proposals were made concerning the ownership of the camps. On November 23, 1981, less than two months after Wien had signed its 15-year NPS contract, Household International (the successor to HFC) announced its intention to sell Wien Air Alaska. The intended buyer was Eagle Enterprises, an air cargo and oil exploration firm; the announced purchase price was $50 million. Eagle Enterprises was initially reported as two-fifths owned by the Doyon Native Corporation. On December 10, however, it was identified as a holding company wholly owned by Neil G. Bergt, the man who that day had become the chairman and chief executive officer of Western Airlines. [133]

Bergt's plan upon assuming the Western Airlines leadership was to push for the Eagle purchase of Wien so that Wien, in turn, could be purchased by Western and incorporated into the Western system. Both of those purchases, however, required the approval of the boards of directors of the purchasing airlines as well as the U.S. Civil Aeronautics Board. During the winter of 1981-82 Wien's sale to Eagle was an off-again, on-again proposition; in November 1982, negotiations between the two companies were terminated. [134]

In November 1981, Household had made it known that they wished to divest Wien. Until that time, Wien had pinned its financial future upon the financial backing provided by Household International. When Wien became aware of the upcoming sale, its growth plans began to unravel and its fortunes began to slide. [135]

Although Household hoped to sell Wien, they had no such plans to sell the various Katmai camps. These included the Wien-owned camps outside the old monument as well as the concessions contract for Brooks and Grosvenor camps. [136] The prospect of Wien's separation, however, put Household in a quandary, because it recognized that if the sale went through, it would have neither the management expertise nor the contractual ability to operate them. Both lay with Wien; more specifically, they lay with Ralph Stemp and Randall Day, the management team which had spearheaded the camp operations the previous summer. [137]

To get around its dilemma, Household created a wholly-owned subsidiary of Wien, Household-Alaska Properties, Inc., which was responsible for the operations of the camps. It transferred the NPS concession contract from Wien Air Alaska to the subsidiary in April 1982; the transfer was made retroactive to December 31, 1981. [138] James J. Flood, the president of Wien, told the agency that no controlling interests were changed in the transfer. On June 6, 1982, Douglas Warnock, the acting regional director of the Alaska Region, concurred with Flood's assessment. Household-Alaska Properties, therefore, operated Brooks and Grosvenor camps during the summer of 1982, although the "controlling interest" of the camps remained with Wien Air Alaska. Stemp and Day continued to run the camp operations. [139]

During the winter of 1981-1982, the NPS was provided glimpses into the tumultuous internal affairs at Wien, the proposed sale to Eagle being just one symptom. In December, for instance, the agency was told that the camps were to become part of another holding company within Household International; [140] the following March, it heard that the camps might be sold or leased to Wien officials Ralph Stemp and Randy Day. [141] Westours, a large Alaska tour company, also expressed an interest in the camps. [142] The Service felt at one point that Wien wanted to donate its concession to the Federal government, and met with Household International officials to evaluate such a possibility. [143] During this period, the Service's reaction to each proposal was that it cared little who owned the camps. Instead, it was more concerned with the ability of the various potential buyers to effectively operate them, and with their willingness to engage in the improvement program as stipulated in the contract.

By the summer of 1982, Household International had expressed a public willingness to sell its interests in Katmai National Park and Preserve. In early August, Household chairman Donald Clark (the successor to Gil Ellis) received an offer to purchase the camps from a new corporation called KatmaiLand, [144] which was headed by Raymond I. Petersen and his son, Raymond F. ("Sonny") Petersen. [145] KatmaiLand offered $110,000 in earnest money to purchase certain land, equipment, and leases owned by Household-Alaska Properties, Inc. These included "all of the property and concession rights in Katmai Park, and the Household owned land, buildings, and property including trucks, vans, boats and tractors needed to operate the camps and lodges [at] Battle Lake, Nonvianuk Lake West [sic], and Kulik Lodge ... also, an 80 acre fee simple airport at Kulik." Two airport leases were also included (one of which was at Kulik Lake), as well as the right to the certificate for air service between King Salmon and Brooks Camp. [146]

Household accepted the offer. The total purchase price, not including the required investment in concessioner housing, was $1.1 million; this total did not include the $350,000 needed for construction of the concessioner employee housing complex. After discussions with the buyer and the National Park Service, the purchase price was apportioned in the following way: $930,000 for the three Wien-owned camps (Kulik, Nonvianuk and Battle), and "all buildings, improvements thereon and all interest in the Concessioner's improvements;" $100,000 for "all fixtures, vehicles and personal property used in connection with" the three camps; $50,000 for "all right, title and interest in the Concession Agreement;" and $20,000 for "all right, title and interest in the [Kulik] Public Airport Lease and the King Salmon Airport Lease." To purchase Household-Alaska's interest at Katmai as well as the new employee buildings, the Petersens paid $500,000 cash; they obtained an additional $1.1 million from the Alaska Industrial Development Authority. [147]

The Petersens seemed to be an excellent choice to take over the camps. Neither man had played an active role in camp operations since the elder Petersen had stepped down as Wien's Chairman of the Board and Chief Executive Officer in 1978. [148] The two were familiar with camp operations. Raymond F. Petersen, KatmaiLand's president, was a thirty-year-old pilot who had grown up in and around the camps; in addition, he had been head of Katmai Air Inc., a charter outfit and air taxi service, for the past nine seasons. (Though Katmai Air retained its business name, the company was liquidated at the time of purchase. Its operating certificate was transferred to KatmaiLand.) His father, KatmaiLand's secretary-treasurer, was 70 years old. Away from the camps for the last four years, he admitted he was "getting bored stiff" with retirement and relished the idea of being involved again. His experience with the camps was an enormous advantage; in addition, he contributed much-needed financial muscle to the fledgling corporation. [149]

The Petersens' bid for the camps was more serious than earlier offers, and the purchase proceeded with little delay. KatmaiLand informed Dave Morris, Katmai superintendent, of the proposed purchase in mid-September, and by late October the financing for the purchase had been completed. On November 19, 1982, the National Park Service approved the transfer of Concession Contract Number CC-9100-1-0001 (for the use of Brooks and Grosvenor camps) and Airport Lease Number A-056478 (for the use of the eastern half of Kulik airstrip) from Household-Alaska Properties, Inc. to KatmaiLand, Inc. After a four-year hiatus, Raymond I. Petersen had once again become active in the management of the Katmai properties which he had developed some thirty years earlier. [150]

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Last Updated: 13-Oct-2004