Public Radio for the Central Kenai Peninsula
Play Live Radio
Next Up:
0:00
0:00
0:00 0:00
Available On Air Stations
Carhartts and Xtratufs Ball — get tickets here!

Econ 919 - The groundwork for investment

 

Everyone seems hopeful about the future both on the Kenai Peninsula and for the state as a whole. But simply being welcoming to new businesses or industries isn’t enough.

 

 

That’s the message out of the Department of Commerce, Community and Economic Development. Former borough mayor Mike Navarre is now the commissioner of that department. He spoke to the Kenai and Soldotna Chambers of Commerce this week about the need for investment coming from outside and inside the state.

The basic idea Navarre is pitching is that even the best, most magical plans for development don’t fix every problem or cure every financial ill. He uses an example of a big new project on the Kenai, coincidentally, not altogether unlike the proposed AK LNG plant. Lots of new jobs, tons of new tax revenue, but also a higher demand on state resources. So, while the borough makes off like a bandit, the state has a bunch of new troopers and students and roads to pay for.

“I just want us to have a dialogue about the costs that are associated and come along with economic development that we have to recognize and find a way to address in our budget strategies and in our revenue plans.”

Municipalities have tax structures in place to not only prepare for a big new venture, but also take maximum advantage of it. The state, not so much.

“It doesn’t matter where you go in Alaska. The tax bases and the tax structures are different at the local level. But because there’s tax structures, property taxes, sales taxes, et cetera, there’s a drawback on the economic activity that corresponds with the cost of services you have to provide as a result of that economic activity. From the state’s perspective, in all those examples, there is no drawback. It’s a net outflow.

This wasn’t an explicit endorsement of a state income tax, even the meager and temporary one proposed by Navarre’s boss, Governor Bill Walker. But the point is, keeping things as they are so that one industry is responsible for generating all the money that pays all the bills is no way forward.

“We have to recognize that if we want to take advantage of (Alaska’s opportunities), we have to spread the burden out. And we have to recognize that if we want economic opportunity and economic development in Alaska, we have to recognize the costs associated with it and make sure we have a rational plan in place that allows us to recover some of the costs to pay for the services that come with economic development.”

After Navarre’s presentation, there was a short Q and A. One question: if I’m ready to pay an income tax, who do I tell? Where do I go?

“It’s ok to talk about taxes. Taxes are not evil. Taxes are what we pay for quality of life things that we want in our communities. Good education, good roads, public safety, health and social services. That’s our cost as residents of society. So, we shouldn’t vilify the components of the discussion that we disagree with, but often, long term policy discussions collide with election cycles...Elect people who are going to engage, who are going to work to compromise, who are not going to be polarized on one end or the other philosophically, because compromise is not a bad word," Navarre said.

You can catch our full interview with Commissioner Navarre from the Kenai Conversation here.

Number for the week: 364.

 

We talk a lot about new plans, new projects, new proposals that will feed our economy now and in the future. But this week’s number, or numbers, reflect the importance of the resources that help feed ourselves, not just the economy.

 

Data for federal subsistence fisheries in the Cook Inlet area were released this week and in 2017, 364 subsistence fishing permits were issued. They went to the communities of Hope, Cooper Landing and Ninilchik and most of the fishing was done on the Kenai River, where nearly 2,000 sockeye were caught mostly with dipnets at Russian River Falls, but a few rod and reel fishermen are in there, too. They landed 82 reds on the Upper Kenai and Russian Rivers and about a dozen at Moose Meadows. An experimental gillnet fishery for Ninilchik residents brought in a little more than 2,000 sockeye. Another experimental fishery on the Kasilof brought in about 300.