ISER Research Matters No. 12 The Alaska Natural Gas Pipeline: What's It All About?
November 28, 2005

The first Lee Gorsuch Public Policy Forum, on November 29 from 7 to 9 p.m. in UAA's Wendy Williamson Auditorium, will  examine one of the biggest public policy issues in Alaska today:  potential construction of a pipeline to carry natural gas from the North Slope. Has construction of a $20-billion pipeline now become feasible—and should the state government try to advance the project through its policy choices? Key questions for the state include whether it should invest public money in the pipeline; what it should do with its royalty gas; and whether it should change its tax system.

The forum is free and open to the public. It will bring together industry experts, state and local  government representatives, and  others from public and private organizations. Lee Gorsuch, former UAA chancellor, will moderate the forum.

A new ISER paper, prepared for the forum, discusses the public policy issues surrounding the potential pipeline. Click here to read the paper, and click here to learn more about the forum.

The Lee Gorsuch Public Policy Forum honors Lee Gorsuch's many contributions to Alaska public policy. Future forums will examine other major public policy issues facing Alaska.

ISER Research Matters No. 11 Changing Alaska's Salmon Harvesting System: What Are the Challenges?
September 21, 2005

What will it take, for Alaska's salmon fisheries to once again become—and remain—profitable, given the challenges of increasing competition and changing global seafood markets? Changing the harvesting system is part of the answer, according to Fran Ulmer and Gunnar Knapp, authors of a new ISER publication. Such changes could help by reducing the costs of catching salmon and increasing the quality and value of the harvest. But changing the harvesting system also raises difficult and complex issues—and is unlikely to happen until Alaskans clarify their goals for the fisheries and establish ways to achieve those goals.

Thousands of Alaskans have quit fishing for salmon since the late 1980s, as increased competition and rapidly changing global seafood markets battered prices. Prices and permit values in some fisheries have rebounded somewhat since hitting lows in 2002, but they are still far below what they were 15 years ago.

Changing the harvesting system, or "restructuring," means changing the rules about who can fish, when and where they can fish, and how much they can catch. Examples of potential restructuring options include permit buybacks, fishing co-ops, and community allocations. If these kinds of changes could help the troubled salmon industry, why has the harvesting system remained essentially the same, after more than a decade of economic crisis? For several reasons:

• The 26 salmon fisheries are diverse, with each facing its own issues.

• Making changes will be complex, and not everyone will benefit. There are many possible ways to change the system, and any change carries its own potential benefits, design considerations, concerns—and uncertainties.

• There's a long-standing tension between social and economic goals for the fisheries, and no consensus among Alaskans about what any changes should accomplish—or who should benefit. In particular, there is a tension between the social goal of creating jobs and the economic goal of reducing costs.

• No organization in state government has clearly defined responsibility for the economic success of the fisheries; clear and broad authority to make changes in the harvesting system; and resources to study and take action on changes. Clarifying that authority will require the Alaska Legislature itself to act, or to give some state agency clear authority to act.

The authors believe that Alaskans need to find ways of addressing the complex and difficult issue of restructuring, for the Alaska salmon industry to become and remain profitable.

Click here to read the Research Summary,"Changing Alaska's Salmon Harvesting: What Are The Challenges?"

Click here to read an earlier, longer paper, "Challenges In Restructuring Alaska's Salmon Fisheries"

ISER Research Matters No. 10 Anchorage at 90
July 11, 2005

Anchorage reflects—in fact magnifies—three nationwide trends: a growing number of minority residents, a large number of baby boomers on the cusp of retirement, and a fast-growing population over 65. Rapid growth in the adjoining Mat-Su Borough is also making Anchorage more like other cities where the population in the outlying areas is less racially diverse and more concentrated among families. Those changes and many more are described in a new ISER profile of recent economic and demographic change in Alaska's largest city.

• Anchorage's growing minority population is on average younger, less well-educated, and poorer than the white population. Those differences are already changing the labor force, school enrollment, and more.
• Growing international immigration to Anchorage is reflected in a 26% increase in the number of Permanent Fund dividend applications from non-citizen residents between 1995 and 2004.
• Anchorage has more baby boomers than almost any place else. Their decisions about when and where to retire will have big effects on the make-up of the population, demand for housing and health care, and more.
• People over 65 could make up 1 in every 10 Anchorage residents by 2020, up from about half that level in 2000. Older residents help stabilize the economy, because they have income that doesn't depend on jobs, but they also increase demand for health care and related services.

• Education levels among young adults in Anchorage are down slightly, even as it gets harder for those without a college education to find good-paying jobs. In 1980, high-school dropouts in Anchorage could earn 72% as much as college graduates; by 2000, that had dropped to just 43% as much.

• Permanent Fund dividends keep poverty at bay, with dividends making up about $1 of every $5 of income among the poorest 20% of Anchorage households. The likeliest to be poor (as is true in other cities) are single mothers and their children, old people living alone, minorities, and people with less education.

Anchorage at 90: Changing Fast, With More To Come, by Scott Goldsmith, Lance Howe, and Linda Leask.

ISER Research Matters No. 9, Economic Significance of the Alaska Railroad
March 16, 2005

ISER recently looked at the economic significance of the Alaska Railroad and found:

• The Alaska Railroad supports about 1,900 Alaska jobs and $83 million in annual payroll. That's based on what the railroad currently spends in Alaska—$108 million a year—to operate trains and to build and upgrade facilities.
• Just over 40 percent of those jobs are railroad jobs and nearly 60 percent are in other Alaska businesses. Railroad spending supports a lot of non-railroad jobs because (1) the railroad buys supplies and services from Alaska businesses; and (2) railroad employees spend their paychecks locally, generating additional jobs and income.
• A $1 million increase in railroad operations spending would generate 14 new Alaska jobs, and a $1 million increase in capital spending would generate 13 jobs. But if railroad spending dropped, it would cost the economy jobs and income.
• Besides spending money, the railroad provides economic benefits we can't measure in jobs and income. For instance, it provides a cheaper, more efficient way to transport bulk commodities like coal; it hauls jet fuel from the refinery near Fairbanks to Anchorage's airport, providing an in-state source of fuel; and it offers tourists a chance to see areas not accessible by road. These benefits are real, but difficult to quantify.

Full report by Bradford Tuck and Mary Killorin.

Research Matters No. 8, Alaska School District Cost Study Update
February 24, 2005

• Cost differences among Alaska's school districts are from 7 percent to more than 100 percent above costs in Anchorage. That's the range of  proposed new geographic cost differentials ISER developed for the Alaska Legislative Budget and Audit Committee. The legislature is considering changes in the differentials the state has used since 1998. These cost differentials are one of several factors that go into a complex formula the state uses to calculate state aid to individual districts. The formula is applied to a base allocation per student that the legislature sets each year.

• The proposed differentials are higher than the existing ones, which range from about 1 to 70 percent above Anchorage costs. That's mostly because, in looking at school operating expenses,  ISER researchers (1) attempted to estimate what it would cost to hire and keep comparable teachers and administrators in all districts; and (2) used districts' actual costs for heat and lights when calculating differences in energy costs.

• Recruiting and keeping teachers and administrators with comparable qualifications could cost anywhere from 5 percent to 67 percent more in other districts than in Anchorage.

• Energy costs per student  can be ten times as high in some remote districts as in Anchorage.     Although energy costs are a much smaller share of operating costs than are salaries, in some districts they contribute significantly to the cost differential.

 

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