• Economic diversity includes oil, gas, tourism, commercial and charter businesses
By Naomi Klouda
Health care facilities will take off as major economic developments on the Kenai Peninsula attempt to get costs under control in a long-term strategy, said Borough Mayor Mike Navarre.
A panel of government officials gave future snapshots at the Kenai Peninsula Economic Outlook Forum 2013 on Thursday, and a chance to hear from Seward, Homer, Kachemak City, Seldovia and Kenai mayors.
The peninsula’s economy is diversified in a borough larger than many states, Navarre noted. Public projects, like the new library in Soldotna and the new cancer center at Central Peninsula, were supported for public funding by the Borough Assembly.
“We’re also in discussion for planning and design money for a new medical center that is part of a long term strategy with health care. It’s a challenge and huge economic costs that are not sustainable,” Navarre said. “It’s a snowball going down hill and it’s hard to get in front of it, hard to get a handle on the effort, but there’s a lot of benefit.”
The college system at the Kenai River Campus of UAA’s Kenai Peninsula College is growing with new dorms going up. Homer’s gas line signals new benefits for the Southern Peninsula Hospital in huge cost savings, as well as for the school district.
“And I’m very optimistic about what’s going on in Cook Inlet – the best thing about gas and oil exploration and activity in the Kenai Peninsula is the people they bring. They’re good people,” Navarre said. “They are not here because they like Alaska and we, as stewards, have to keep in mind that we need to advocate on behalf of our shareholders because they are keeping an eye out for their shareholders.”
Homer Mayor Beth Wythe said an important message to impart is that Homer is a community open for business.
“Changes in both commercial and recreational fishing industries, combined with the general state of the economy, leave Homer in a financial situation that requires reviewing what we have to offer,” she told the group. “I want to share with you not only about our tourism industry, but also about many exciting activities taking place in the Port and Harbor and the much anticipated arrival of natural gas which could mean a lot for our future. The future is bright and things are good in Homer, although the times are tough.”
The harbor as an economic engine continues to see expansions in both upgrades and as a center for a thriving marine trades, Wythe said. The extension of the Homer Spit trail and the Nick Dudiak Fishing Lagoon mean more tourism opportunities that could keep folks at the End of the Road for longer stays.
The City of Homer has “proudly supported” Buccaneer during its time here. “Homer’s first class trades-workers are helping get the rig back to work, because everyone would rather see the rig securing energy for Alaska’s future rather than tied up at the Deep Water Dock,” Wythe said “Homer, like most Alaskan communities always has a concern for the environmental aspects of drilling and delivering oil and gas to meet the needs of our State and communities, but those rigs also represents jobs for people in Alaska and Homer.”
The revenue at the harbor has increased three-fold since the rig has been there, Wythe noted.
Kachemak Bay’s rich ecosystem continues to teach others about the environment. BP brings new hires to Homer to build a sense of team and show them how the environment would be impacted if there is an oil spill.
“It would be impossible to live here and not appreciate the majesty of our environment,” she said.
Kachemak City Mayor Phil Morris explained his community (population 500 plus) role in hooking up the gasline when it comes through Homer. He put it out there that they would need to generate cash to help build the distribution system. “We were able to generate $600,000 to pay for the distribution system within a few weeks. I don’t think anyone else has tried this lately,” Morris said. “Almost all this money came out of Kachemak City.”
They also are talking with other funding agencies, since the project will cost about $1 million. The philosophy at Kachemak City, for the mayor, is to “do nothing,” in the belief that services cost money and then residents pay higher and higher taxes.
“Well, we can no longer say we’re not doing anything. But then we say, just wait a year and we can go back to doing nothing. We put in the sewer line 20 years ago. This too will be over when it’s over and we can go back to doing as little as possible,” Morris said.
Seward mayor Ristine Casagrande talked about growth at the 600-student Alaska Vocational Technical Center and at the Alaska Sealife Center. They also are working on a new library-museum that began 10 years go.
Big projects are ahead for Seward. A Seward Marine Industrial Center is to be built with backing from the Alaska Industrial Development and Export Authority. A new coal terminal at the Alaska Railroad Corp., facility will have a big impact on the economy and add about 16 full time employees, she said. Shell’s Noble Discoverer was moored in Seward to provide support during the grounding of the Kulluk. “That does a wonderful job of keeping restaurants and hotels busy,” Casagrande said.
But even more exciting on the outlook is the home-porting of the Sikuliq, a new vessel for the University of Alaska Fairbanks School of Ocean and Science. It is owned by the National Science Foundation and should be home-ported there soon.
Ron Long, the Seward city manger, said projects have to pass a three-way test or “triple bottom line approach.” Is it economically feasible, socially acceptable and environmentally sustainable. “We work together… We’re are also in the borough, and as a whole it does a good time of presenting to oil companies that we can be a home and a resource for that industry.”
If Shell’s rig, the Kulluk, had been ported in Seward, it wouldn’t have gotten into trouble on rough seas that caused its grounding and an environmental threat, Long said.
Seward is hoping to capitalize on some of the $12 million in a transportation bond package to develop the port for such circumstances and for a new breakwater. A new vessel haul-out facility that would become the only one north of Ketchikan also in the works for funding, Long said.
Seldovia also has worked on a slate of projects to inject the economy. Mayor Tim Dillion said commercial fishing and tourism continue to be economic drivers of the 243 population. Construction produces the third leg of the economy there.
A Main Street construction project was funded through a legislative grant, as was a $200,000 RV Park project with money from the Alaska Department of Natural Resources. A $400,000 gazebo is being built on the harbor for people to wait in case it rains. And the town is refurbishing its famous boardwalks.
On the horizon also is a value-added processing plant in a 5,000 square foot building that has two investors waiting to lease it, Dillion said. A $2 million Denali Commission grant will go to harbor upgrades and new floats.
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