CIRI cuts salaries, employees

Posted: Wednesday, December 18, 2002

ANCHORAGE (AP) -- Cook Inlet Region Inc. has laid off 13 staffers, cut executive and director pay, and eliminated some perks in an effort to slash overhead by 25 percent.

Chief executive Carl Marrs said the belt-tightening comes as management considers its next move after a wildly successful foray into telecommunications. CIRI is the most profitable of the Alaska Native corporations created by Congress in 1971.

The Anchorage-based company scored big two years ago when it cashed out an investment in VoiceStream Wireless. CIRI rewarded its owners with two huge payouts totalling $65,000 to the typical shareholder with 100 shares.

Now, as the company weighs its next investments and starts to pay higher taxes, it's time to ratchet back, Marrs said. The company faces higher taxes because it has exhausted the net operating losses that helped shelter its real estate income from taxes in recent years.

CIRI has trimmed the salaries of senior managers, including himself, Marrs said. He declined to specify by how much. Marrs' base salary 2001 was $321,021, not including a $220,000 bonus and $17,000 in profit-sharing, according to a company proxy statement.

The company is also discontinuing the use of company vehicles by Marrs and seven executive vice presidents as of January, spokeswoman Allison Knox said.

On Monday, 10 CIRI staffers in various departments received notice that their jobs are being eliminated, Knox said. The new cuts followed three layoffs in October. Also, the board of directors voted last Friday to reduce their monthly stipends by 20 percent, from $1,500 to $1,200, chairman Terry Simpson said.

The cuts coincide with calls for a $10,000 dividend for shareholders and continuing accusations from dissidents of extravagant spending by CIRI management. Marrs has characterized the accusations as baseless and said the $10,000 dividend proposal is nothing more than a ploy aimed at winning votes in next year's corporate election.

''I know it's the real motivation here,'' Marrs said.

Harold Rudolph, a board member and management critic, said the company is getting a cash infustion from the sale of real estate assets in the Lower 48. That money should be distributed to shareholders, Rudoph said.

Simpson called the dividend proposal fiscally irresponsible.

''Could we scrape together the cash and pay that out? Sure. But remember our investment in VoiceStream,'' Simpson said.

The money used to invest in VoiceStream came from the sale of radio and TV stations. If CIRI had taken the proceeds from those sales and paid the money out in dividends instead of investing it in wireless, shareholders would never have gotten their recent checks totalling $65,000, he said.



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