The United States Supreme Court issued a decision today in United States v. Alaska, No. 84 Original, commonly known as the "Dinkum Sands case." The Court ruled against the state on all issues, determining that the formation known as Dinkum Sands is not an island, that each island in Stefansson Sound has its own belt of territorial sea rather than one continuous belt of territorial sea, and that the United States retained ownership of the coastal waters within the National Petroleum Reserve-Alaska (NPRA) and the Arctic National Wildlife Refuge (ANWR) at statehood.

"Needless to say, we are extremely disappointed with the Court's ruling," Attorney General Bruce Botelho stated. "The state was exceptionally well represented in this case, and we presented very strong arguments, but the Court disagreed with our view of the law. As we analyze the decision in greater detail over the next few days, we will determine what courses of action remain open to the state."

The Court found that Dinkum Sands, a gravel and ice formation in Stefansson Sound along the northern coast of Alaska, is not an island constituting part of Alaska's coastline for the purpose of determining the state's entitlement to submerged land under the Submerged Lands Act. In order to constitute an island, the Court held, a formation must be above high water except in abnormal circumstances. Dinkum Sands is sometimes above high water and sometimes below, when the ice within the formation melts and the feature slumps in elevation; therefore, the Court concluded that it is not an island.

The Court disagreed with the state's argument that it owns the submerged lands extending seaward three miles from a line drawn connecting the fringe of islands in Stefansson Sound and between that line and the mainland. It ruled instead that the state has title only to the submerged lands within three miles of the mainland and each individual island. Because some of the islands are more than six miles from the main coastline, the ruling means that the United States has title to enclaves of submerged lands totally encompassed within state-owned submerged lands.

The Court also found that the United States rather than the state owns the lands underlying coastal waters within the boundaries of NPRA and ANWR. The state argued that it took title to these lands at statehood under the constitutional Equal Footing Doctrine and under the terms of the Submerged Lands Act of 1953. The Court, however, held that the United States clearly intended to retain title to these lands when Alaska became a state.

The case began in 1979 when the United States moved for leave to file a complaint under the Supreme Court's original jurisdiction, presenting a dispute with Alaska over the ownership of submerged lands along Alaska's Arctic Coast. The Supreme Court granted the federal government's motion and the United States filed a complaint setting out a dispute over the right to offer lands in the Beaufort Sea for mineral leasing. Alaska counterclaimed against the United States, seeking a decree that it holds title coastal submerged lands within NPRA and ANWR.

The filing of the complaint satisfied statutory requirements for the state and federal governments to conduct a joint oil and gas lease sale of the disputed lands on December 7, 1979. High bids for the disputed lands totaled more than $557,900,000, which was placed in two interest-bearing escrow accounts pending resolution of the disputes. Four additional escrow accounts were subsequently established to hold funds from later federal OCS lease sales presenting similar issues.

In settlement of a dispute over distribution of revenues from federal leasing of the OCS within three miles of state-owned submerged lands, Alaska in 1987 received 27 percent of the escrowed amounts -- approximately $323 million. The balances of the accounts have remained in escrow earning interest, currently totaling approximately $1.525 billion. Of this total, the state will receive approximately $4.2 million.