By Mayor Beth Wythe
Charles Dickens may have said it best with the opening line from his 1859 classic, The Tale of Two Cities. “It was the best of times; it was the worst of times.”
The current economic situation in Homer reflects many aspects of that sentiment. 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. At this point in time, Homer certainly needs to present itself as a community that is open for business.
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.
Tourism: Just as fish processing diminished in Homer several years ago, a vibrant tourism industry began to grow. Many of you know what a great place Homer is for visitors. You may even bring your families here to enjoy our comfortable hotels, B&Bs and vacation rentals, world class dining, fishing, outdoor adventures and tours and the plentiful opportunities for shopping.
The businesses that make up the tourism industry in Homer now contribute largely to the fabric of our economy. Like all of Alaska, there has been a decrease in out-of-state driving traffic coming to Homer. Some of this was offset by an increase in Alaska Marine Highway traffic as a result of the advertising campaign for Alaska’s 50th anniversary.
Recent city projects enhance the attractiveness of Homer as a destination: Improvements at the Karen Hornaday Park, and trails upgrades like the Beluga Slough Trail provide family outdoor opportunities.
The Chamber has recorded a decline in length of stay for RV traffic due to poor maintenance of the fishing hole. This summer dredging was completed to restore the hole, and it is anticipated that it will again attract more visitors and keep them here longer.
Homer hosted a number of travel writers during 2012. The Chamber estimates $300,000 in free advertising. Alaskan visitors have also become important contributors to our tourism market.
Our Port and Harbor have long been a vital economic engine for Homer. The diversity of user groups in our harbor generates economic stability: commercial fishing, charter fishing, marine transportation,oil and gas support vessels,recreational boaters, water taxis and tour operators all contribute toward helping Homer survive downturns in the economy. The Harbor was reaching capacity due to a large number of derelict vessels, but an aggressive campaign was launched by the Harbor Master’s Office and space opened by working with local businesses like Peninsula Scrap.
The City Council helped by passing an “Underway” Policy which has provided a model for other communities as well. Homer’s long-term goal is an East Boat Harbor Expansion. There is demand for space to home-port more vessels in Homer; and, vessel owners want to take advantage of our marine crafts and trades people.
The expansion could also help to bring Alaska vessels home from out of state ports like Seattle. Improvements currently underway at the Port and Harbor include: Extension of the Spit Trail Replacing Floats; Energy Upgrades on System 5 and exploring tidal energy possibilities.
Homer is emerging as a port, and developing as a transportation sub-hub. Funds have also become available to perform a feasibility study on our Deep Water Dock Expansion project. This project would provide an alternative route for moving goods into Alaska’s central regions and provide the security of an alternative containerized freight port to Anchorage in the event of an emergency.
Jack-up Rig: You may have noticed the jack-up rig at the Deep Water Dock. Homer’s Port and Harbor and the City of Homer have been proudly supporting Buccaneer’s needs while they are 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. 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.
BP brings their new hires to Homer each summer for teamwork exercises and to show them first-hand the environment that an industrial accident would impact. Having participated in the closing dinner they host at the end of the training, I have no doubt that the employees and managers of the organizations that track down our oil and gas are just as concerned about protecting the environment as we are. Many of them are from Alaska, and there have even been some Homer High School graduates. It would be impossible to visit, or live as many do, in this area and not appreciate the majesty of our surroundings.
There is no denying that reckless acts and carelessness have wrought disaster on more than one occasion, but we live in a fallen world and none of us is without fault. Therefore, it is important not to cast stones, but to learn from our mistakes; make corrections in our course; and boldly move into a brighter future. Only through continued exploration do we progress, and only through progressing do our local, state and national communities continue to thrive.
On a very fundamental level for the Port and Harbor, the vessel moorage payments from the rig have almost tripled the Deep Water Dock revenues. Locally, the impact has been similar with many residents, businesses, hotels, stores and restaurants benefiting from employment opportunities and purchases made in support of the rig. This has been a boost to our winter economy at a time when it was sorely needed.
Homer crafts and trades workers are building business relationships with Buccaneer and their employees.
Hopefully, as a result of these relationships crew boats and rig tenders will continue to dock here.
This is the very face of economic development; building relationships and working together for a brighter future.
Natural gas is coming to Homer and many businesses and homes anticipate the benefits of lower heating bills.
Trunk line construction is scheduled for this spring, with a two-phase build-out of the distribution system also in the works.
The Council is in the process of determining what role the City will play in this build-out, but optimism is high for the long-term benefits of this change for our community’s economy.
Most of Homer heats with fuel oil.
Natural gas is projected to be more than 60 percent less expensive than fuel oil. It is anticipated that affordable heating will allow existing businesses to put the savings into developing and growing.
It is also expected that competitive energy rates will make Homer more attractive to businesses considering locating here because of our beautiful setting, location on the road system, and educated and enthusiastic work force.
While the economy is having an impact, things are still good in Homer. In times like these, we always draw on our strongest assets: our people and our location.
As we continue to work on: Establishing Homer as a destination through improving our parks, trails and outdoor attractions; and strengthening our Port and Harbor availability and services through upgrades and expansion; as well as anticipating the benefits of affordable energy through our new natural gas line.
We also look forward to the development of year-round jobs through expanded marine trades and other associated industries; and, diversifying our economy by working with potential newcomers such as oil and gas companies. In closing, the biggest take away that I would like to confirm is that Homer is open for business!
Mayor Beth Wythe was elected in October. She has served on the Homer City Council eight years prior to her election. She delivered these remarks at the Kenai Peninsula Economic Outlook 2013 last week in Homer.
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