NSEDC has a wholly-owned subsidiary, Norton Sound Investment Company LLC, or NSIC. The State of Alaska and the federal government approved the formation of NSIC in December 2001, and the subsidiary was formed effective January 1, 2002.
The formation of NSIC is part of NSEDC's long-term strategy for managing its proceeds from allocations of Bering Sea fish. The NSEDC Board of Directors has adopted a policy which strikes a balance between addressing today's economic development needs in the region and the need to develop a solid financial base for the future, comprised of investments in the offshore Bering Sea and other financial investments. These investments have increased in complexity, and NSIC's role is to oversee and manage them.
The investments held in NSIC, such as the 50% ownership interest in Glacier Fish Company and 50% ownership in Norton Sound Ventures, IFQ holdings, and other acquisitions, generate income which can supplement CDQ royalties. NSEDC refers to these funds from its investments as "second-generation" funds, since NSEDC first receives royalties ("first-generation"), and then receives income from the investment of royalties ("second-generation" funds).
NSIC will identify additional investments and also oversee the operation of those investments. NSIC's job is to help ensure that these investments are run in a business-like fashion. NSIC will not, itself, make in-region grants or subsidize any operation. Instead, NSIC will remit a portion of each year's income to NSEDC. It is at the NSEDC level that local economic development decisions are made, subject to state and federal approval.
It is hoped that over time, the income from NSIC will provide an increasing level of second-generation funds to NSEDC for in-region benefits. The Community Benefit Share, which has been a per-community payment of $10,000 in 2000, $20,000 in 2001, $20,000 in 2002,
$35,000 in 2003, $50,000 in 2004 and $75,000 in 2005 were all made from second-generation funds.
NSIC has contracted with S. Rieger & Company LLC to perform management services for NSIC.
Norton Sound Economic Development Corporation
420 L Street, Suite 310, Anchorage, AK 99501, Phone 1-907-274-2248, Fax 1-907-274-2249