ECONOMIC BASE OF THE FAIRBANKS

NORTH STAR BOROUGH, ALASKA

By

Robert C. Haring

and

Clem C. Correia

Institute of Social, Economic and Government Research

University of Alaska June 1967

The preparation of this report and all figures contained herein was financially aided through a federal grant from the Department of Housing and Urban Development, under the Urban Planning Assistance Program authorized by Section 701 of the Housing Act of 1954, as amended. This document and maps were prepared under the Urban Planning Assistance Program for the Alaska State Housing Authority.

FOREWORD

This report on the economic base of the Fairbanks North Star

Borough is one of several continuing Institute research projects relating to community planning and development in Alaska. It is part of the Borough's comprehensive planning program being carried out with the assistance of the Alaska State Housing Authority and the U. S.

Department of Housing and Urban Development.

The basic work for the economic base comple erl before

March of this year, and the initial report draft was completed in June,

It evaluated past and current economic activities, analyzed growth trends and dealt with the future extent and character of economic development in the Borough.

In the second week of August 1967, while the report was undergoing review, the Fairbanks area was hit by an unprecedented and devastating flood, The majority of private properties and public facilities sustained serious damage. Economic activity came to a standstill; next it was redirected toward the tremendous task of flood relief and reconstruction.

The flood has dealt a serious blow to the economic life of the

Fairbanks North Star Borough. But it also has created new opportunities for public and private actions that can result in a stronger economic base and a more viable community. The next weeks and months will tell whether the community will move in the direction of realizing these opportunities or whether the flood will constitute a permanent blow to

Fairbanks' economy.

i It is the current purpose of this economic base study to help provide a point of departure toward a positive and constructive planning and redevelopment effort. The report presents an economic profile of

Fairbanks as it was before and up to the flood. It provides a basis for seeing where Fairbanks would have gone without the disaster. It does not, however, attempt to define the alternative courses of development

available the This is a task that is part of the next stage in the development planning and programming process. And it is the hope of those who participated in this report that it will be helpful in this most important task.

Many persons contributed time, effort and special talents toward completing this project. In particular, Fairbanks North Star Borough

Chairman Harold Gillam and Planning Director Donn Hopkins helped with the directing and molding of the study. Mrs. Mary Putman and Charles Olson of the Alaska State Housing Authority provided both supervision and substantive help. Richard Berg, long experienced in Alaska transportation development and currently transportation specialist for the Port of

Seattle, was a key consultant for this project. A number of University of Alaska faculty members gave valuable aid to the study, particularly

Ernest Wolff of the Mineral Industry Research Laboratory and Ichirou

Inukai of the Department of Economics.

The University Computer Center assisted in developing the Regional

Input/Output Model and in processing results from survey research into the structure of personal income, occupations and preferences. Support in these endeavors was given by Computer Center Director Edward Gauss and Institute programmer Don Walker. This work was partly financed by the National Science Foundation.

ii Primary responsibility for the report rests with Dr. Robert C.

Haring, a senior member of the Institute and Head of the Department of Business Administration. His principal assistant for this study was Clem Correia. Mrs. Eleanor Hungate, James Sullivan and Edgar McDonald

contributed in their special areas of interest and in the thankless

task of assembling and revising portions of the final report.

versions and segments of this report were reviewed by the

Borough Planning Commission, and their suggestions proved particularly useful.

This project is part of the technical basis for preparing the

Comprehensive Plan for the North Star Borough. Its companion project,

titled Natural Resource Base of the Fairbanks-North Star Borough, was published earlier this year.

Victor Fischer, Director Institute of Social, Economic and Government Research

September 1967

iii TABLE OF CONTENTS

Chapter

FOREWARD i

LIST OF TABLES vi

LIST OF FIGURES ix

I INTRODUCTION 1

Purposes 1 Method of Research 2 Organization 3

II SUMMARY AND IMPLICATIONS 4

Employment and Earnings 4 Population and Labor Force Trends 7 Educational Composition of the Labor Force 11 The Input/Output Model 13 Spatial Distribution of the Economic Base 15 Logistics and Physical Distribution 17

III EMPLOYMENT AND EARNINGS 21

Occupational Pattern 21 Income Structure 2/ Changing Composition of Growth n Seasonal Forecast to 1970 34 Summary 41

IV POPULATION AND LABOR FORCE TRENDS 42

Social Characteristics and Migration 41 Educational Composition of the Labor Force 50 Cross-Section of the Adult Labor Force 61

v STRUCTURE OF THE REGION'S ECONOMIC ACTIVITY 65

Input/Output Framework 66 Growth Potential 7q Applications of the Planning Method p,4

VI SPATIAL DISTRIBUTION OF INDUSTRY AND HOUSEHOLDS p, 7

Historical changes R7 Geographic Density Patterns 90

iv TABLE OF CONTENTS

Chapter

Growth Alternatives and Potential Implications for Planning

VII LOGISTICS AND PHYSICAL DISTRIBUTION 102

Flow of Goods and Services 103 Logistics and Transportation 113

Appendixes

A 1965 TRANSACTION TABLE 137

B 1965 DIRECT REQUIREMENTS TABLE 141

c ANNOTATED BIBLIOGRAPHY ON INPUT/OUTPUT ANALYSIS FOR URBAN PLANNING IN NON­ METROPOLITAN AREAS 146

Bibliography 148

v LIST OF TABLES

Number Title

1 Sources of Personal Income in the Fairbanks­ Interior Alaska Region, by Industry Group, 1960, 23

2 Nonagricultural Wage and Salary Employment in Fairbanks Labor Market by Season and Industry, 1961-1965 ...... • . • • . . . . •... 24-25

3 Seasonal Indexes for Fairbanks, Alaska Nonagricultural Wage and Salary Employment, by Industry Category, 1961-1965 ...... 26

4 Summary of Characteristics of Selected Income­ Occupation Surveys of Fairbanks During 1965-1967 ...... 27

5 Reported Annual Income Grouping of Alaska Respondents According to Number and Percent for the State and North Star Borough, December, 1966-January, 1967...... • ...... 28

6 Survey of Alaskan Households by Borough Location of Residence According to Income Group by Number and Percent, December, 1966- January, 1967 ...... 30-31

7 Estimated Annual Family Income in the Fairbanks North Star Borough, Alaska, March, 1967 ... 32

8 Respondents in the Fairbanks North Star Borough, Alaska, According to Age and Income Classes as of January, 1967. . . . • ...... 33

9 Forecasted Annual Employment Rates in the Fairbanks Labor Market by Non-Agricultural Industries, 1967-1970 . . . . • .... 38

10 Forecast of Employment in the Fairbanks North Star Borough, 1967-1970, by Quarter ....

11 Distribution of Persons in the Fairbanks Election District by Age and Sex, 1960 ...... 40

12 Population of Fairbanks and the Nineteenth Election District, 1910-1965 ...... 45

vi LIST OF TABLES

Number Title

13 Recent Estimates of Population for the Fairbanks Area. 45

14 Percent of Inhabitants Age 25 and Over, According to Years of School Completed for the City of Fairbanks and Fairbanks Election District, 1950 and 1960 ...... 46

15 Percent of Inhabitants, Age 25 and Over, According to Years of School Completed, for the United States, Alaska, and Fairbanks Election District as of 1960...... 46

16 Estimated Elementary School Budgeting Capacity and Utilization, Fairbanks North Star Borough as of May 26, 1967 ...... 51

17 Projected Construction and Estimated Public School Capacity, Fairbanks North Star Borough, Alaska. 51

18 Recorded Birth and Mortality Rates in Selected Alaskan Areas, 1959-1965 .... 52

19 Enrollment in Barnette Elementary School, by Grade, 1960-1967 ...... 53

20 Enrollment in Denali Elementary School, by Grade, 1958-1967 ...... 53

21 Enrollment in Hunter Elementary School, by Grade, 1959-1967 ...... •. 54

22 Enrollment in Joy Elementary School, by Grade, 1961-1967 ...... 54

23 Enrollment in Nordale Elementary School, by Grade, 1958-1967 ...... 55

24 Enrollment in University Park Elementary School, by Grade, 1958-1967 55

25 Enrollment in North Pole Elementary School, by Grade, 1958-1967 ...... 56

26 Summary of Isolated Area Elementary School Enrollment in Fairbanks North Star Borough. 56

27 Enrollment in Main Junior High and Lathrop High Schools, by Grade, 1959-1967 .... 57

vii LIST OF TABLES

Number Title

27-A Total School Enrollment by Grade in Fairbanks North Star Borough, 1961-1967 58

28 Enrollment in Elementary and Secondary Parochial Schools, Fairbanks North Star Borough, Alaska, 1960-1966 ...... 59

29 Fairbanks North Star Borough Final Demand, 1Q65 70

30 Summary of Purchasing and Contracting Activities by the National Military Establishment in the Fairbanks Area, Fiscal Years, 1960-1965 .•.. 83

31 University of Alaska Net New Investment Expenditures on Building, 1957-1966 . 100

32 Gross Receipts As Reported In Business License Tax Returns, City of Fairbanks and Fairbanks North Star Borough, 1962-1965 ...... 114

33 Air Taxi and Charter Operations in the Fairbanks North Star Borough, 1966 ...... l?.0

34 Fairbanks International Airport, Summary Passenger and Freight Traffic, 1953, 1962-1966. l?.1

35 Common Motor Carriers Serving the Fairbanks North Star Borough...... 123

36 Percentage Distribution of Private and Commercial Trucks by Body Type and Industry Usage Operating in Alaska, 1963 • ...... 124

37 Selected Alaska Railroad Petroleum Rates to Fairbanks as of 1966 .•...... 127

38 Selected 1967 Commodity Tariffs to Fairbanks and Anchorage From Representative Points of Origin. 130-132

viii LIST OF FIGURES

Number Title

1 Actual and Trend Employment Overall and in Selected Industries, 1962-1966 .. 35

2 Actual and Trend Employment in Selected Industries, 1962-1966 ......

3 Proportion of Population of the City of Fairbanks According to Age Group and Sex, 1950 and 1960 ...... 47

4 Summary of Birth and Mortality Rates in the Fairbanks Election District According to Race, 1959-1965 ...... 4~

5 Employment, Non-Agricultural, Fairbanks Labor Market Area ...... 6?

6 Average Monthly Insured Unemployment, Fairbanks Labor Market Area . . 62

7 Population of Fairbanks and the Nineteenth Election District, 1910-1966...... 1)3

8 Condition of Structures, Fairbanks and Vicinity, 1966 ......

9 Condition of Structures, Fairbanks and Vicinity, 1958......

10 Land Use, Fairbanks and Vicinity, 1966 .•

11 Land Use, North Pole, 1966 ....

12 Density of Population, Fairbanks and Vicinity, 1950......

13 Designation of Subdivisions and Location of Public and Parochial Schools in Fairbanks and Vicinitv, 1967 •......

14 Comparison of Overall Cost of Living Indexes for Selected Alaskan Cities and Seattle, 1957-1966 . . . . . • ...... • . . . • . . 104

ix LIST OF FIGURES

Number Title

15 United States All-City Consumer Price Index Average Compared with the Seattle Consumer Price Index Average, 1960-1966 ...... 105-106

16 Seasonal Indexes for Housing in Fairbanks, 1962-1966 ...... 107

17 Seasonal Indexes for Selected Food Cost Compo- nents in Fairbanks, 1962-1966 ...... 10~

18 Seasonal Indexes for Costs of Transportation in Fairbanks, 1962-1966...... lnO

19 Seasonal Indexes for Costs of Apparel in Fairbanks, 1962-1966 ...... nn

20 Seasonal Indexes for Costs of Other Selected Products in Fairbanks, 1962-1966 ...... lll

x I

INTRODUCTION

The Economic Base Study of the Fairbanks North Star Borough is concerned with the Borough's economic base and its composition, and with forecasting economic conditions for the geographic area. It deals with the thin the it tion and labor force Tt examines conditions which had led to growth of private industries and households, as well as the composition of changes in the public sector of this urban economy.

Purposes

The purposes of the study are ---

(1) To inventory and analyze published data and subjective information on the structure of the Borough's business and economic conditions.

(2) To evaluate the Borough's economic growth record. Considering these conditions, (a) to determine appropriate short-range development possibilities which will stimulate the local economy; and (b) on a regional basis, to evaluate growth potential in the planning area.

(3) To survey the Borough's retailing, service and wholesaling facilities, and evaluate them with reference to adequacy in physical distribution and overall estimated space requirements.

(4) To survey the Borough's industries (as designated by the

Alaska Department of Labor) with respect to location, type, number of employees, type and value of product, and to appraise which new industries are likely to develop.

1 (5) To inventory and evaluate the region's overall transportation facilities concerning the capacity and services of this industry in providing balanced growth.

(6) In broad quantitative terms, to estimate future land use patterns and needs by commerce, industry and residences, and to forecast the demand for corresponding public service facilities.

(7) To forec t :ion and d composition by age, sex, and education; and also to evaluate labor force and employment trends through 1985.

Method of Research

This study represents a consolidation of many previous reports and an interpretation of social and economic data dating back over several census periods. These various source materials and references noted in the bibliography were placed in perspective. The existing information was supplemented materially by new surveys which were part of an examination of the structure of the Borough's economic activity shown in input/output table form in a later chapter and appendixes. Other types of estimates, such as price indexes and current income group information, were updated.

This vast assembly of information was condensed, interpreted, analyzed and consolidated into its present form.

The forecasts of economic activity, work force and population conditions are manifest in the several time series, usually including the preceding eight to ten years. Trend and cycle analyses were used at various junctures in forecasting, and alternative forecasts are presented based on varying sets of assumptions, which are indicated. An overriding

2 consideration in the entire project has been the presentation of the more relevant and current information, rather than reiteration of data

that are still available from original sources and which need not be

republished here. (See Bibliography.)

Organization of the Report

The report is divided into seven chapters, which follow directly

from the purposes stated earlier, and several appendixes. Chapter II,

following this introduction, is the overall summary and covers policy

implications of economic base research on the Fairbanks North Star

Borough. It is followed by major content and interpretive chapters,

designated Chapters III through VII. Chapter III reviews the employment

and earnings-income flow pattern within the Borough, and various factors

that have occurred which reflect how the economic base of the community has changed. A summary of economic forecasting is found in Chapters

III and IV which indicates the immediate long term economic outlook

for the community. Chapter V is concerned with the quantitative structure

of the region's industries and discusses the input/output matrixes

contained in Appendixes A and B. The interpretation of this planning

model is found in that chapter. Chapters VI and VII deal with spatial

and logistical problems, and depict how and where economic activity occurs.

3 II

SUMMARY AND IMPLICATIONS

Employment and Earnings

Since 1960, public agencies have been the major employers in the

Fairbanks North Star Borough. Growth in non-military employment has

rep largest share of private employment.

Personal income in the Fairbanks-Interior Alaska region was divided as follows in 1960 --

(1) government wages and salaries, 52 percent;

(2) private industry sources, 35 percent;

(3) proprietors and property income, 13 percent.

From 1960 to early 1967, only relatively minor changes were recorded in these industry shares of personal income generated. Changes were due largely to erratic movements of the construction industry and a continued decline in mining activities.

The occupational pattern and income structure of the Fairbanks area have been measured at regular intervals by a variety of surveys.

The Borough contains a large proportion of higher income families in

comparison to the rest of the State of Alaska. This apparently favorable

income differential is partially offset by higher actual income tax rates and by the prevailing costs of living. According to one survey, approxi­ mately 65 percent of local families earned in excess of $10,000 in the year 1966. Other surveys reported the proportion of high-income households

4 at a lower percentage for comparable periods. However, in each survey

Fairbanks was generally similar in income distribution to other cities in Alaska.

Fairbanks contains a significant number of near-poverty families.

Research on this topic indicated that these poverty groups consisted primarily of --

(a) relatively uneducated and untrained;

(b) young adults with families;

(c) migrants from other Alaskan communities to Fairbanks; and

(d) Alaska Natives.

The distribution of personal income in the region is also affected by other conditions. The most important are: sharp seasonal fluctuations in employment and personal income, rapid labor turnover, and critical shifts in the year-to-year location of business activities, e.g., dispersed location of construction contracts awarded in Interior and

Western Alaska.

In reviewing the performance of the Fairbanks economy during the period 1957-1966, several significant factors appeared. They were

(1) A large amount of public employment has shifted away from primary dependence upon military spending.

(2) Trade and service industries (motel, hotel, campgrounds) have prospered as a direct result of increased recreation and tourism demands.

(3) Individual industries have undergone offsetting changes, and consequently, overall employment has remained free from violent annual

5 fluctuations because of employee shifts from one industry to another, e.g., mining to construction.

(4) Subsistence level occupations (e.g., trapping) have practically disappeared, and have represented an increasingly marginal way of survival.

Many adult persons, when not fully employed, engage in part-time subsistence exploitation of natural resources, especially during the off-season.

Seasonal fluctuation of economic activity in the Fairbanks area has followed a recurring annual pattern. The analysis of annual data up to 1966 suggested several longer-term trends in employment according to industry category. The industry composition of employment was forecasted in detail from 1967 up to 1970. Major facets of this forecast are listed as follows:

(1) Employment has been increasing in the Fairbanks labor market by roughly 490 persons per year, or nearly a thousand new employees every two years.

(2) Logistics activities, e.g., transportation, wholesale-retail trades and services, comprise a segment of private industry which is already larger in employment size than contract construction, although obviously the activities of these industries are interrelated. In recent years, these logistics activities and contract construction have accounted for 45 percent of the employment in the Borough.

(3) Federal employment in the Fairbanks labor market has remained a stabilizing force. Overall federal employment has increased in a regular and recurring fashion, and the number of military personnel has been quite stable until recently.

6 (4) By 1970, Borough-wide average annual employment is expected to be between 11,600 persons during the seasonal low and 15,400 persons during the peak season of the third quarter. The government sector will continue to represent the dominant industry, comprising about 40 percent of total employed persons.

The longer-term outlook for population changes in the Fairbanks­

North Star Borough is very difficult to identify for several reasons-­

(a) There is no detailed long-term continuous time series

concerning past population.

(b) Historical growth rates, especially those available

through Bureau of the Census information, have changed

drastically, i.e., every seven to ten years.

(c) Trends apparent for the period 1950 to 1964 probably

will not continue, since major forces in business conditions

have already changed. Accordingly, the forecasts of

population and labor force have been a compromise between

a review of the historical trends and an evaluation of the

externally generated business conditions which will probably

appear in the next eight to ten years.

Both the population and the number of persons in the labor force will depend significantly upon what economic conditions occur three, five and fifteen years from the time this study was conducted. If external conditions become quite favorable and employment increases, the population

7 and labor force will expand more rapidly than projected, i.e., out­ migration and labor force turnover will decline, while in-migration from other Alaskan areas will increase. The significant growth stimulating factors will be -- growth of the recreation-tourism industry, multiple benefits derived as "stopover" privileges are granted to air carriers

(e.g., Pan American Airways), and continued expansion of educational facilities and operations at the Univers of Alaska

Even with these expanding external conditions, rapid overall employ­ ment growth is unlikely. More probably, the overall population and resulting labor force will expand much more rapidly than the demand for local employment (as young adults become educated and trained). However, the population growth rate will have little effect upon the remaining labor force ten years from now, i.e., employable persons will out-migrate if jobs are not available here. The rate of population growth, however, does affect this region in several other ways -- namely, increased demand for retail trade and housing services, and correspondingly large demand for public education at all grade levels.

In view of these general propositions, the following population and labor force trends were identified and the economic implications are shown

(1) Between the 1950 and 1960 Census, the proportion of males to females (in many adult age groups) was equalized. This trend has continued, and a significant disparity no longer exists.

(2) Persons in the more senior age groups, especially over

60 years of age, have become a smaller percent of the population. This change represents their out-migration prior to retirement rather than a significant mortality rate.

8 (3) The most rapidly increasing group, as a percent of the

population, has been the under-15 years group. This age group has doubled

in the decade 1950 to 1960, and large increases continued through 1966.

This major change in the age concentration of the population represents

a rapidly increasing demand for public education at the primary and

secondary levels.

es, i cond and

the Borough revealed several areas of concern

(1) These determinants of the population are quite different

for Native and non-Native groups.

(a) The Native birth rate and the death rate, at most

age groups, are much higher than rates for non-Native

persons, and this is especially apparent in infant

mortality. Overall, the natural increase to the

population (births minus deaths) is at least 50

percent higher for Natives than for non-Native

persons in Interior Alaska.

(b) In-migration of Native families occurs rapidly to

Fairbanks, and these persons are less able to move

from Fairbanks once they have arrived.

(c) Differences in the educational status, family size

and training of Natives are significant and represent

very real conditions limiting opportunities in employment

and for higher income.

(2) Net additions to the overall population are occurring at about

20 to 22 persons per thousand, and this rate is expected to remain stable

9 or increase slightly. Birth rates will remain high in comparison to other United States regions because of a younger population, reflecting adult persons in the childbearing stage of the life cycle.

(3) No age distribution of persons is available from the Bureau of Census since that of 1960. However, using resident enrollment in public schools to represent children of the corresponding age groups,

1 choo large and regular. In addition, the effects of the net immigration are apparent where grade-to-grade changes far exceed the previous year's totals. In addition, there was substantial evidence of household mobility in terms of family movement from one school location to another within the Borough area. The overall growth in demand for public education has occurred more rapidly than either overall population growth or employment growth. This condition constitutes a major cause of rising educational costs.

A review of the available information (which differed slightly by source) on the growth in enrollment and the facilities available at various schools, clearly substantiated the following conclusions

(1) Certain school areas are underbuilt, while others have idle room space and capacity.

(2) The growth rate in particular housing areas is much more rapid than in others, even after allowing for bus transfers of students from high enrollment to low enrollment facilities.

(3) The exact location of families in Fairbanks, and consequently the locational demand for educational facilities, is extremely difficult to forecast on a long-range basis.

10 Educational Composition of the Labor Force

The educational composition of the labor force is especially important because of the background of technical and managerial skills which it represents. Compared to the resident population, the labor force is relatively small because of the high proportion of school age children and the number of persons attending the University. These factors are partially offset by the wide incidence of two-adult wage­ earner families. The public school system is generating 350-400 high school graduates each year, and many of these proceed to college and military training rather than enter the labor force. In summary, the major sources of labor force growth are immigration, voluntary entry of adults temporarily not in the labor force (such as housewives) and entry of newly trained high school and college graduates.

In-migration additions to the labor force are a major area of concern for the following reasons --

(1) immigrants, especially from other Alaskan areas, are

relatively untrained and unskilled, and

(2) immigrants, who are semi-skilled, frequently arrive in

Fairbanks with interests and occupational plans which are not

usable in this labor market.

A cross-section of the adult labor force revealed the following conditions from 1960 to the present --

(1) Since governmental agencies are a major employment industry, their personnel policies effectively control the labor market. Educational attainment is a major criterion for governmental employment.

11 (2) The high level of educational background of Fairbanks residents, age 25 and over, is overstated because of the following conditions

(a) the small number of older persons who would have had

limited educational opportunities; and

(b) the relatively large numbers of less educated persons

who remain employed in Fairbanks only in seasonal

industries and on a sporadic basis. For the next

several years, the demand for these types of less

skilled workers will not grow, and unemployment is

inevitable unless upgrading and retraining occurs on

a relatively large scale. The effective labor force

(comprised of the employed and those unemployed who

easily enter the market) will not greatly exceed

maximum seasonal employment in Fairbanks for most

occupational groups; i.e., trained persons who remain

unemployed for extended periods must migrate or their

skill levels will deteriorate.

The economic outlook for 1975 and 1985 is represented in several

labor force and employment projections. The Borough's population

probably will expand at approximately a thousand persons per year until

1970, and out-migration will control the total population level after

that time. Expansion of public facilities must occur to handle the

increased number of school age persons, whether they migrate or eventually

reside in Fairbanks as employed adults. This demand for public education

will have doubled by 1975 over present levels and costs of education

will have risen rapidly as well.

12 The Input/Output Model

The Borough was identified as an economic region for purposes of a

quantitative input/output model. Using employment as the unit of account,

the sales connections among local and outside industries were shown and

evaluated. The model is relatively elementary as a mathematical tool, but eful for what factors have generated

economic changes in the Fairbanks region. A review of sales transactions

among industries indicated the following significant ties --

(1) Interior Alaska's state and federal government employment

is eventually dependent upon direct federal and transfer funds. In

other Alaskan regions, state agency employment is not so heavily

dependent upon direct federal support, i.e., much state employment

is based on natural resource-based industries, such as fisheries and

forestry.

(2) Logistical and supporting service businesses, such as

transportation, derive significant revenues from the high level of

governmental activity. Therefore, growth of the transportation

industry and of public utilities is indirectly dependent to a large

extent upon these same federal transfer funds.

(3) A large portion of the growth in wholesale and retail

trade is derived from "exports," in this case recreation and tourism.

(4) For all practical purposes, manufacturing as a basic industry

does not exist in Fairbanks.

(5) An analysis of final demand for Fairbanks goods and services

indicates that ultimately the economy is quite narrowly confined and

is highly exposed to externally generated recessions.

13 For example, a significant cutback in military expenditures or in federally sponsored construction, or a withdrawal of military federal

employment almost certainly would bring about direct declines in the

supporting businesses and industries. Fairbanks' existence has been

dependent upon federal transfer funds. This may be superficially desir­ able at present, but may not continue successfully a decade or more in

f sources of demand must be found or increased, e.g.,

recreation and tourist traffic should be expanded in the short run along with continued expansion of the University. Over longer periods, both

import substitute industries and the production of goods which may be

sold "outside" should develop. If these things occur, the economy

could become more diversified and stable.

An analysis of the flows-of-funds represented in the requirements

tables of the input/output model clearly suggests the following

(a) relatively large amounts of money, income and

employment "leak" out of the economy as a result of the

structure of spending;

(b) sharp seasonal fluctuations in economic activity do

not encourage permanent growth in employment on an annual

basis; and

(c) unfavorable price-cost connections restrict growth. The

lack of competitive pricing or sufficient product lines

in supporting industries hampers development of a diversified

economy.

14 Spatial Distribution of the Economic Base

Land use patterns, including particularly the location of businesses and households, were examined for the period 1950 to present. In reviewing the information, several major geographic changes were apparent

(1) The major house building and urban growth period occurred from 1950 to 1963, during which time the population also increased most rapidly. The growth rate in housing investment has been relatively small since that period.

(2) Reported increases in population of the City of Fairbanks have been due principally to annexation.

(3) Within the Fairbanks North Star Borough, significant numbers of families moved from one location to another, i.e., from apartment to house--frequently from a lower to a higher income residence--and vacancy rates were not uniform among housing areas. The downtown business district, which once dominated Fairbanks trade, had declined in importance by 1966, at which time some three or four other shopping areas were present.

(4) Neighborhood densities have not approached the levels observed in other U. S. urban regions. Reported vacancy rates in some apartments and residences remain high. The poor condition of some dwellings and overpricing could account in part for this.

In other parts of the United States, the degree of installation of public utility services is frequently a controlling factor on the rate and direction of home building. In Fairbanks, however, annexation

15 has occurred long after residences in those neighborhoods were established,

and the extension of public utility services has been almost entirely

into areas which are already built up. The extension of the utility

services in the Fairbanks area has not been used to entice construction

into predesigned residential areas.

Many residential neighborhoods in Fairbanks have been declining in

rnarketabili There is 0 0 le

residential land; however, the following special conditions are noted

(1) Relatively large public land holdings exist within the

Borough.

(2) The setting aside of new recreation and wildlife areas,

such as the Creamer's Dairy area, could, if not properly planned and

integrated with other land uses, hamper organized development.

(3) Significant amounts of privately owned land are not in use.

Many owners are delinquent in their tax payments, owners-of-record

sometimes cannot be located, and public repossession of land is

occurring slowly.

The physical capacity of the Borough's business-industrial sector

at the close of 1966 was much greater than is apparent from the level

of activity which has been occurring, or than is expected to be required

over the next fifteen years. Existing businesses could increase output

(sales and employment) by using off-season capacity. These businesses

are capable of expanding output two-fold over existing levels. This

expansion could occur without appreciable new business and housing

investment.

16 All in all, projected employment, population and industry growth

for 1970 are sufficiently mild that no major changes in land use would be forthcoming under normal conditions. While tax revenues are increasing

regularly, these increases are directly attributable to gains in the sales

position of the Fairbanks community at large and to improved tax payment

enforcement. The long-term revenue position depends, of course, on the

's abi1 to compete in price, product and service with other

Alaskan urban areas, as well as with producers from outside the State.

In this respect, dramatic improvements in price competition and in local

business productivity are especially desirable.

Logistics and Physical Distribution

Except for the construction industry, which is highly dependent

upon governmental funding, retail and wholesale trade (including service

businesses) are the largest areas of private industry. These marketing

institutions dominate the Fairbanks business district, and the largest

proportion of their sales is allocated to households and non-corporate

business persons, including military personnel. Examinations of the

entry of Safeway Company in 1961 and J. C. Penney Company in 1967 have

provided a special insight into the development of this wholesale and

retail marketplace. The long-term impact of these new national stores

will be almost entirely favorable as the position of Fairbanks is

17 improved and the price reductions aid consumers in the long run. In­ directly, their entry will result in a continued improvement in sales tax revenues.

The following conditions affect marketing institutions in the

Fairbanks economic base --

(1) Consumer prices have remained relatively stable and product lines have extended rapidly in the last five years.

(2) Price and wage levels in Fairbanks historically have been quite high and represent a development problem in terms of attracting import substitute industries.

(3) The cost-of-living differential remains at 30 to 40 percent of gross salaries for most families, and wage differentials must be paid in order to attract talented persons to the area.

In examining the services which support the Fairbanks logistical complex, transportation facilities are found to be large and diversified in comparison to those serving similar-sized urban areas elsewhere. An analysis of in- and out-bound traffic (by mode and cost) supports the conclusion that substantial improvements have been made in recent years.

The most important are --

(1) Sea-Land innovations and the subsequent improvements by its competitors in the prompt delivery of goods to the Borough at lower and lower prices.

(2) The alteration of buying procedures and use of quantity discounts by dealers and wholesalers has lowered costs. The new tariffs, including freight breaks, have lower effective costs.

18 (3) The largest share of commodities is shipped, in part, liy water to the Borough. This inexpensive mode of shipment will probably undergo price reductions.

(4) Air freight service has become more economical for almost all routes and directly complements other modes of transportation as well as aiding the recreation and tourist industries.

and t affec the future economic position of the area, especially from 1970 to 1985.

Among these special considerations are extensions of the Alaska Railroad

and new pioneer roads north and west of the present widely-traveled

arteries. These public investments will almost certainly stimulate new

resource development near the Borough, and will result in a temporary build-up in sales and services to these areas. In certain product lines,

particularly petroleum cargo and natural gas, major logistic improvements

are long overdue. Public policy and regulatory barriers affecting trans­

portation of these commodities to Fairbanks discourage possible 40

percent reductions in retail prices. In the main, the marketing facilities

and transportation equipment which are available to the Borough's businesses and industries are quite advanced and are adequate to support

the current level of business activity.

Backhaul rates to other U. S. regions are highly favorable and

almost any product which could be sold in those markets will not encounter

high transportation costs or delays in arrival. The successful selling

of Fairbanks-produced goods to other regions depends upon low outbound

rates and probably upon the improvement of historically prevailing

19 inbound rates. Considering the rapid turnaround time of the present logistic facilities and new marketing institutions, the space requirements of these industries will not expand materially, except perhaps for parking space.

20 III

EMPLOYMENT AND EARNINGS

Employment and earnings patterns of adult persons in the Borough are important in that industrial conditions are reflected in the magnitude of earnings. Additionally, the income distribution of households reflects the current level of worker and skills. of employment and migration of households occur as employment opportunities are affected by local prosperity or recession. Certain conditions affecting labor migration are examined in this section of the report.

This chapter has the following purposes --

(1) To identify the Borough's major employer industries, their relative importance in growth since 1960, and the present industry composition of employment.

(2) To identify recent and present occupational patterns and the structure of income resulting from the employment and earnings patterns observed.

(3) To survey the changing job composition of public and private industries within the planning area.

(4) To project seasonal employment and earnings through the year 1970.

Occupational Pattern

The major employer industry in the Borough is government. This sector contributed approximately 52 percent of wage and salary income to

21 the region's economic base in 1960, as shown in Table 1. It is apparent from Table 2 that local dependence upon public employment has declined very slightly, if at all, since that time. For example, public employees represented more than 45 percent of covered employment in 1964-1965.

By implication, government's personal income contribution in the area 1 probably has changed very little.

The public employment sector is highly int , i.e., state employee levels depend significantly upon transfer payments from the federal government. These conditions are discussed in greater detail in

Chapter V. In terms of wages, contract construction and wholesale- retail trade were the largest private industries in 1960. Since then, transportation and service industries have grown in importance, In

Table 1 these conditions are partially disguised in proprietor's income.

Income Structure

The occupational pattern and structure of household income in 2 Fairbanks have been surveyed at regular intervals since 1959. Various surveys of local occupations and income were made by the Alaska Division 3 4 5 of Lands, Community Action Program, and Alaska State Housing Authority.

1 This point was verified recently. See J. Readnour, A Comparison of Governmental Agencies by Occupations and Wages in the North Star Borough Alaska. (College: unpublished M.B.A. Thesis, University of Alaska, 1967.)

2 see Bureau of Labor Statistics (1959) Sales Management (annual), Ward (1959), Haring, Price-Cost study (1965), Minion (1966) studies cited in the bibliography.

3 Hereafter referred to as the 1967 Alaska Outdoor Recreation Study, A.O.R.S. 4 Taken March, 1967. Hereafter designated C.A.P. study.

5 A low-income area survey covering a portion of the city, Spring, 1966.

22 TABLE 1

SOURCES OF PERSONAL INCOME IN THE FAIRBANKS-INTERIOR ALASKA REGION, BY INDUSTRY GROUP, 1960 (in $000,000 and percent)

(1) (2) (3) (4) Source 1960 Percent * Total Percent+

Government Wages and Salaries 72.1 51. 7 Federal - Civilian 17.7 24.5 Federal - Military 44.7 62.0 State and Local 9.7 13.5 100.0

Private Wages and Salaries 49.4 35.4 Mining 2.7 5.5 Cons true tion 17.2 34.8 Manufacturing 1. 7 3.4 Transportation, Communications, and Public Utilities 6.9 14.0 WhQlesale and Retail Trade 11. 8 23.9 Services 7.1 14.4 Other 2.0 ---4.0 100.0

Proprietors' Income 6.3 4.5 Property Income 6.9 4.9 Other 4.8 3.4

Total Personal Income 139.5 99.9

*Percentages of appropriate column (1) entry.

+Percentages of Total Personal Income

SOURCE: U. S. Department of Commerce.

23 TABLE 2

NONAGRICULTURAL WAGE AND SALARY EMPLOYMENT IN FAIRBANKS LABOR MARKET BY SEASON AND INDUSTRY, 1961-1967

Nonagricultural Contract Transportation Wholesale Retail Finance, Ins. Service Gov't Periods Wg. & Sal. Empl. Mining Construction Mfg. Comm., & Util. Trade Trade & Real Estate & Misc.

1961 lQ 8252 97 398 229 740 230+ 1139+ 299 992 4129 2Q 8794 262 857 258 751 220+ 1297+ 328 1100 3721 3Q 10079 282 1638 298 767 234+ 1301+ 313 1260 3987 4Q 9144 154 867 232 727 236+ 1230+ 328 1181 4191 Annual Average 9068 199 940 254 746 230 1424 317 1133 4007

1962 lQ 8711 69 316 212 803 225 1057 342 1281 4409 2Q 9329 192* 605 241 852 233 1147 346 1366 4347 3Q . 107 31 285 1557 268 839 244 1168 403 1516 4452 4Q 9754 160 986 227 774 233 1152 396 1288 4538 Annual Average 9632 177 866 237 817 234 1131 371 1362 4436

1963 lQ 8994 86 413 196 762 232 1110 391 1193 4613 2Q 10305 222 971 250 825 241 1211 430 1318 4836 3Q 12054 248 2168 299 911 265 1386 429 1277 5067 4Q 10464 174 1088 224 865 273 1336 405 1132 4967 Annual Average 10454 182 1160 242 840 253 1261 414 1230 4870

1964 lQ 9278 80 461 197 850 266 1157 370 1132 4765 2Q 10353 207 808 255 938 272 1265 379 1282 4946 3Q 12175 225)'t 1914 281 1123 328 1331 412 1471 5091 4Q 10917 136 1155 206 1016 299 1384 381 1205 5135

Annual Average 10681 162 1085 235 982 291 1284 385 1272 4984

24 TABLE 2 (cont'd)

Nonagricultural Contract Transportation Wholesale Retail Finance, Ins. Service Gov't Periods Wg. & Sal. Empl. Mining Construction Mfg. Comm. , & Util. Trade Trade & Real Estate & Misc.

1965 lQ 9985 68* 598 197 950 269 1254 377 1217 5057 2Q 11891 215 1524 239 1044 287 1373 389 1418 5311 3Q 12797 191* 1920 268 1078 324 1422 385 1550 5659 4Q 11360 136 874 193 1076 267 1460 391 1316 5666 Annual Average 11508 152 1229 224 1037 287 1377 386 1400 5423

1966 lQ 10569 47 575 171 1059 269 1339 398 1251 5460 2Q 12510 180 1650 210 1090 1750** 410 1390 5830 1670>'0 '< 3Q 12680 207 1794 220 1090 380 1267 6053 4Q 11297 94 844 203 1004 1764** 403 1214 5773 1967 lQ 10784 so 624 213 997 1721** 413 1240 5527 2Q 12280 150 1180 220 1150 1730*>'< 450 1350 6050

+Figures revised subsequent to publication of the Alaska Department of Labor Statistical Quarterly.

*Estimated employment, based on seasonal patterns. Actual employment figures not released by the Employment Security Division, Alaska Department of Labor.

** Aggregate figures only available.

SOURCE: Employment Security Division, Alaska Department of Labor.

25 TABLE 3

SEASONAL INDEXES FOR FAIRBANKS, ALASKA NONAGRICULTURAL WAGE AND SALARY EMPLOYMENT, BY INDUSTRY CATEGORY, 1961-1965

Nonagricultural Contract Transportation Wholesale Retail Finance, Ins. Services Gov't Periods Wg. & Sal. Empl. Mining Construction Mfg. Comm. , & Util. Trade Trade & Real Estate & Misc.

1961 lQ 91.0 48.7 42.3 90.2 99.2 100.0 91. 6 94.3 87.6 103.0 2Q 97.0 131. 7 91.2 101. 6 100.7 95.7 104.3 103.5 97.1 92.8 3Q 111.0 141. 7 174.3 117.3 102.8 101. 7 104.7 98.7 111.2 99.5 4Q 100.8 77.4 92.2 91. 3 97.5 102.6 99.0 103.5 104.2 104.6 1962 lQ 90.4 39.1 36.5 89.5 98.3 96.3 92.8 92.2 94.1 99.4 2Q 96.9 108.8 69.9 101. 7 104.3 99.7 101. 4 93.3 100.3 98.0 3Q 111.4 161.5 179.8 113.1 102. 7 104.4 103.3 108.6 111.3 100.4 4Q 101.3 90.5 113.9 95.8 94.7 99.7 101.9 106.7 94.6 102. 3 1963 lQ 86.0 47.1 35.6 81.0 90.7 91. 7 88.0 94.4 97.0 94.7 2Q 98.6 121. 6 83.7 103.3 98.2 95.3 96.0 103.9 107.2 99.3 3Q 115.3 135.9 186.9 123.6 108.5 104.7 109.9 103. 6 103.8 104.0 4Q 100.1 95.3 93.8 92.6 103.0 107.9 105.9 97.8 92.0 102.0 1964 lQ 86.9 49.4 42.5 83.8 86.6 91.4 90.1 96.1 89.0 95.6 2Q 96.9 127.8 74.5 108.5 95.5 93.5 98.5 98.4 100.8 99.2 3Q 114.0 138.9 176.4 119.6 114.4 112.7 103.7 107.0 115.6 102.1 4Q 102. 2 84.0 106.5 87.7 103.5 102. 7 107.8 99.0 94.7 103.0

1965 lQ 86.8 44.6 48.7 87.9 91. 6 93.7 91. l 97.7 86.9 93.3 2Q 103.3 141.0 124.0 106.7 100.7 100.0 99.7 100. 8 108.4 97.9 3Q 111. 2 125.2 156.2 119.6 104.0 112.9 103.3 99.7 llO. 7 104.4 4Q 98.7 89.2 71.1 86.2 103.8 93.0 106.0 101.3 94.0 104.5 5 Year Indexes lQ 88.2 45.8 41.l 86.5 93.3 94.6 90.7 94.9 90.9 97.2 2Q 98.5 126.2 88.7 104.4 99.9 96.8 99.9 100.0 102. 8 97.4 3Q 112.6 140.6 174.7 ll8.6 106.5 107.3 105.0 03.5 ll0.5 102.1 4Q 100.6 87.3 95.5 90.7 100.6 101. 2 104.1 101. 7 95.9 103.3 SOURCE: Table 2 26 These projects differed substantially in scope and design. They were supplemented on various matters and for specific areas with current surveys by the authors. (See Tables 6-8.)

The AORS-1967 and C.A.P. income surveys differ slightly in their

results. The former, which also provides the estimated income distribution

in other Alaskan Boroughs, indicated a larger proportion of higher income households. The AORS~l967 s shows a high degree of correspondence 6 with the 1965 Income Tax Survey of Minion. Considering that

these two surveys approached the Fairbanks population in different ways,

together they probably comprise the "best" overall estimates of the dis-

tribution of income and occupations for the area. These income estimates

and occupational patterns are summarized in Tables 4 and 5.

TABLE 4

SUMMARY OF CHARACTERISTICS OF SELECTED INCOME­ OCCUPATION SURVEYS OF FAIRBANKS DURING 1965-1967

Selection of Method of Gathering Survey Sample Sample Size Data

(a) Minion Study Municipal Utility Dii-ect Mail 1965 List, stratified 207* Questionnaire random

(b) O.R.S.-1967 Spatial density Personal interview sample, near­ 208 with followup random

(c) C.A.P. 1967 Mostly urban, Personal interview non-random 298 without followup

*A 20-percent return in the Fairbanks area, which also barely satisfied chi-square tests for the four geographic strata.

6 J. N. Minion, Personal Income Characteristics of .... , (College: unpublished M.S. Thesis, University of Alaska, 1966).

27 TABLE 5

REPORTED ANNUAL INCOME GROUPING OF ALASKA RESPONDENTS ACCORDING TO NUMBER AND PERCENT FOR THE STATE AND NORTH STAR BOROUGH DECEMBER, 1966 - JANUARY, 1967

STATEWIDE NORTH STAR BOROUGH

+ + Income Grouping No. of Cum. No. of Cum. (in dollars) Resp.* Percent Percent Resp.* Percent Percent

Up to 1,500 29 2.2 3 1. 4 2.2 1.4 1,500 - 2,999 69 5.2 5 2.4 7.4 3.8 3,000 - 4,499 48 3.6 3 1.4 11.0 5.2 4,500 - 5,999 71 5.4 13 6.3 16.4 11.5 6,000 - 7,999 140 10.6 11 5.3 27.0 16.8 8,000 - 9,999 184 14.0 30 14.4 41.0 31. 2 10,000 - 14,999 412 31. 3 72 34.6 72.3 65.8 15,000 - 19,999 206 15.6 39 18.8 25[ 87.9 30.8[ 84.6 20,000 - over 124 9.4 25 12.0 97.3 96.6 No reply 34 2.6 7 3.4 99.9 100.0 TOTALS 1317 99.9 208 100.0

*Number of Respondents

+Accumulative Percent

SOURCE: Authors' computations from data obtained from the Department of Natural Resources.

28 Some occupations change when persons are attracted to positions having built-in wage increases. Wage rates and salaries of public employees, skilled laborers and salaried professional workers have increased regularly since 1960 at a rate of 5 to 7 percent annually. However, overall personal income has not increased directly with wage rates.

Less overtime pay is available during local industry recessions

cordi inromP household falls during recession even though wage rates per hour continue to increase. Additionally, during recent years, out-migration has occurred among skilled, more highly trained laborers, while new jobs became available at lower skill levels and wage rates. Consequently, the labor force turnover has been accompanied by a lowering of wage payments to several income groups.

Changing Composition of Growth

Several major changes in the economic base of the Borough are apparent during the period 1959-1966. In addition, certain trends, shown partially in Figures 1 and 2, are evident and appear to govern the longer term development of the area. For summary purposes, the significant changes are:

(1) The relatively large public employment component is shifting away from major dependence upon military spending to a greater reliance upon non-military public spending.

(2) The trade and service industries have expanded markedly. This condition is partially attributable to "tourism and recreation" activities, which are increasing in economic importance. However, the finance-real

29 TABLE 6

SURVEY OF ALASKAN HOUSEHOLDS BY BOROUGH LOCATION OF RESIDENCE ACCORDING TO INCOME GROUP BY NUMBER AND PERCENT, DECEMBER, 1966 - JANUARY, 1967

Income Group * ($100's) -15 15-30 30-45 45-60 Borough No. Pent. No. Pent. No. Pent. No. Pent.

Nome 8 27 6 5 7,2 5 lOJf 6 8,5 Greater Anchorage 11 37.9 38 55.1 15 31.3 15 21.1 Matanuska-Susitna 0 o.o 2 2.9 5 10.4 8 11.3 Kenai Peninsula 2 6.9 8 11.6 10 20.8 9 12.7 Kodiak Island 0 o.o 2 2.9 3 6.3 4 5.6 Greater Juneau 4 13.8 5 7.2 5 10.4 6 8.5 Gateway 1 3.4 2 2.9 2 4.2 3 4.2 Greater Sitka 0 o.o 2 2.9 0 o.o 7 9.9 North Star 3 10.3 5 7.2 3 6.3 13 18.3 Military 0 0.0 0 0.0 0 o.o 0 0.0

TOTALS 29 99.9 69 99.9 48 100.1 71 100.1

*Percent for each income group by Borough.

Income Group + ($100's) -15 15-30 30-45 45-60 Borough No. Pent. No. Pent. No. Pent. No. Pent.

Nome 8 10.8 5 6.7 5 6.7 6 8.1 Greater Anchorage 11 3.8 38 13.1 15 5.2 15 5.2 Matanuska-Susitna 0 0.0 2 1. 9 5 4.7 8 7.5 Kenai Peninsula 2 1. 2 8 4.7 10 5.8 9 5. 2 Kodiak Island 0 o.o 2 2.2 3 3.4 4 4.5 Greater Juneau 4 2.6 5 3.3 5 3.3 6 4.0 Gateway 1 1.0 2 1. 6 2 1. 6 3 2.4 Greater Sitka 0 0.0 2 2.0 0 0.0 7 6. 9 North Star 3 1.4 5 2.4 3 1. 4 13 6.3 Military 0 0.0 0 0.0 0 0.0 0 0.0

+Percent for each borough according to income group.

SOURCE: Authors' computations and Department of Natural Resources

30 TABLE 6 (continued)

Income Group * ($100's) 60-80 80-100 100-150 150-200 200- Other No. Pent. No. Pent. No. Pent. No. Pent. No. Pent. No. Pent.

7 5.0 6 3.3 23 5.6 9 4.4 2 1. 6 3 8.8 32 22. 9 39 21. 2 81 19.7 39 18.9 14 11. 3 7 20.6 15 10.7 15 8.2 29 7.0 11 5.3 14 11. 3 7 20.6 20 14.3 24 13.0 59 14.3 24 11. 7 13 10. 5 3 8.8 16 11. 4 14 7.6 22 5.3 15 7.3 12 9.7 1 2.9 13 9.3 15 8.2 43 10.4 33 16.0 25 20.2 2 5.9 17 12.1 26 14.1 45 10.9 19 9.2 10 8.1 0 0.0 9 6.4 15 8.2 38 9.2 17 8.3 9 7.3 4 11. 8 11 7.9 30 16.3 72 17.5 39 18.9 25 20. 2 7 20.6 0 o.o 0 o.o 0 0.0 0 0.0 0 0.0 0 0.0 140 100.0 184 100.1 412 99.9 206 100.0 124 100.2 34 100.0

Income Group+ ($100's)

60-80 80-100 100-150 150-200 200- Other No. Pent. No. Pent. No. Pent. No. Pent. No. Pent. No. Pent.

7 9.5 6 8.1 23 31.l 9 12.2 2 2.7 3 4.0 32 11.0 39 13.4 81 27.8 39 13.4 14 4.8 7 2.4 15 14.2 15 14.2 29 27.4 11 10.4 14 13.2 7 6.6 20 11.6 24 14.0 59 34.3 24 14.0 13 7.6 3 1. 7 16 18.0 14 15.7 22 24. 7 15 16.9 12 13.5 1 1.1 13 8.6 15 9.9 43 28.5 33 21. 9 25 16.6 2 1.3 17 13.6 26 20.9 45 36.0 19 15.2 10 8.0 0 0.0 9 8.9 15 14.9 38 37.6 17 16.8 9 8.9 4 4.0 11 5.3 30 14.4 72 34.6 39 18.8 25 12.0 7 3.4 0 o.o 0 o.o 0 0.0 0 o.o 0 0.0 0 0.0

31 TABLE 7

ESTIMATED ANNUAL FAMILY INCOME IN THE FAIRBANKS NORTH STAR BOROUGH, ALASKA

March, 1967

Income Level * Cumulative (in dollars) Number Percent

Up to 1,900 8 2.69 2.69 2,000 - 2,900 13 4.37 7.06 3,000 - 3,900 11 3.69 10. 75 4,000 - 5,900 21 7.04 17. 79 6,000 - 7,900 35 11. 74 29.53 8,000 - 9,900 84 28.18 57. 71 10,000 - 14,000 83 27.86 85.57 15,000 - 20,000 35 11. 74 97.31 21,000 and over 8 2.69 100.00 TOTAL 298 100.00

*Rounded to nearest $100; to nearest $1,000 in over $10,000 classes; unequal class intervals.

SOURCE: Community Action Program

32 TABLE 8

RESPONDENTS IN THE FAIRBANKS NORTH STAR BOROUGH, ALASKA, ACCORDING TO AGE AND INCOME CLASSES AS OF JANUARY, 1967

Income Groups ($00)

Age Class 0- 15- 30- 45- 60- 80- 100- 150- 200- (in years) 15 30 45 60 80 100 150 200 Other Total Percent

20-29 0 1 0 6 2 8 13 4 3 0 37 21. 3

30-34 0 0 1 1 1 5 15 7 7 1 38 21.8

35-39 0 0 0 2 2 1 5 6 2 1 19 10.9

40-54 0 1 0 1 3 6 20 9 7 2 49 28.2

55-64 1 0 1 2 0 5 4 6 2 1 22 12.6

65-99 0 1 0 0 2 0 0 0 1 0 4 2.3

Other+ 0 0 0 1 0 1 1 0 1 1 5 2.9

TOTAL 1 3 2 13 10 26 58 32 23 6 174 100.0

PERCENT 0.6 1. 7 1.1 7.5 5.7 14.9 33.3 18.4 13.6 3.4 100.0

+Not reported

SOURCE: Authors' computations from O.R.S. - 1967 Study.

33 estate and manufacturing industries may not benefit directly from this type of growth.

(3) Monthly changes in activities of individual industries are much more pronounced than quarterly changes in total non-agricultural employment. Also, individual industry high and lows are offsetting.

Consequently, unemployment is much more pronounced and aggravated than immediately apparent from the overall data, (See Table ,)

A significant number of persons is excluded from coverage in the State Labor Department statistics. Among these are:

(a) trappers, certain miners and fishermen,

(b) certain proprietors and family businesses,

(c) subsistence activities, e.g., hunting, and domestic manufacture,

(d) non-resident employees of national firms who are physically situated in the Borough for relatively long periods, and

(e) many additional types of part-time employment.

A result of this limited employment "coverage" is the corresponding difficulty in gauging prosperity and declines in these activities.

For the most part, opportunities in trapping and subsistence work have declined or have become "marginal" employment during winter months.

Forecasting the Composition of Industry Employment to 1970, By Season

A detailed examination of nine major non-agricultural employment industries in the Fairbanks area, covering the first quarter 1961 through the second quarter 1967, generally revealed a highly predictable seasonal pattern. In addition, total non-agricultural employment for the Fairbanks labor market area moved from year to year in a regular growth pattern,

34 FIGURE l 12000 Total Employment

11500

11000

10500

10000

6000

5500

5000

4500

4000

1700

1600 Trade

1500

1400 Service ~~--- 1300 ~---=- ~ 1200

~~~~~-~~~~~~~L-~~~~~____J 1962 1963 1964 1965 1966

ACTUAL AND TREND EMPLOYMENT OVERALL AND IN SELECTED INDUSTRIES, 1962-1966 (in persons) FIGURE 2 1250

1200 Contract Construction 1150

1100

1050

1000 Transportation

950

900

850

800

450

400 Finance and Real Estate ------Trend --- 350

300

250 Actual Manufacturing Trend 200 = ~l 150 Trend =::::::::::: Mining 100

~ 1962 1963 1964 1965 1966 ACTUAL AND TREND EMPLOYMENT IN SELECTED INDUSTRIES, 1962-1966 (in persons) 7 usually less than two percent away from a central trend line. Using this trend formulation and the seasonal index numbers by industry, a forecast of quarterly employment was constructed. At the time of computation and statistical analysis, figures were reported through the second quarter 1966. Table 9 shows a forecast for 1967 through 1970.

The data, by industry, for these seasonal periods are summarized in

in Table 3. The detailed forecast derived from these data and local conditions in certain selected industries is shown in the Tables 10 and 11.

The following special conditions were noted --

(1) The major source of growth in employment, since 1961, clearly is the government sector. This industry alone (comprised of federal, state and local employees) accounted for approximately 50 percent of the annual growth rate of roughly 490 employees in the labor market.

(2) Contract construction, transportation and wholesale-retail- services trade are nearly equivalent in their positive contributions to

the wage and salary employment throughout the Borough. These three industries represented 44 percent of the growth which occurred since

1961.

(3) The finance-real estate sector has remained relatively stagnant

since Statehood; mining employment has moved erratically but, in the main,

7 Least Squares straight line trend, t = a +bx. The average growth rate for this area was 489 persons on an annual rate basis.

37 TABLE 9

FORECASTED ANNUAL EMPLOYMENT RATES IN THE FAIRBANKS

LABOR MARKET BY NON-AGRICULTURAL INDUSTRIES, 1967-1970

Industry 1967 1968 1969 1970

(a) Mining 120 107 94 81

(b) Contract Construction 1,308 1,388 1,467 1,547

(c) Manufacturing 288 232 236 240

(d) Transportation 1,103 1,169 1,235 1,301

(e) Trade 1,739 1,814 1,889 1,964

(f) Service 1,413 1,435 1,457 1,479

(g) Finance and Real Estate 385 385 385 385

(h) Government 5,686 5,949 6,212 6,475

Total Non-Agricultural Employment I 12,045 12,534 13,023 13,512 II 11,982 12 ,4 79 12,975 13,472

Trends: Straight line, least squares, by industry, T a + bx x = 0 in 1963. (a) Mining: 157 - 12.7x (b) Contract Construction: 1,113.6 + 79.5x (c) Manufacturing: 232.4 - 4.4x (d) Transportation: 942.8 + 66.3x (e) Wholesale and Retail Trade: 1,556.8 + 74.6x (f) Finance and Real Estate: 388.2 + Ox (g) Service: 1,332.6 + 21.8x (h) Government: 5,009.2 + 262.6x I Non-agricultural employment forecasted from aggregate trend line. II Sum of industry components (a) through (h) by year.

SOURCE: Authors' computation.

38 TABLE 10

FORECAST OF EMPLOYMENT IN FAIRBANKS NORTH STAR BOROUGH 1967-1970 BY QUARTER

Trans p. , Corn- Wholesale & Total Period Contract rnunication, Retail Finance and Non-agricultural Yr. Qtr. Mining Const. Mfg. Public Util. Trade Services Real Estate Gov't Ernployrnen t

1967 1 55 563 196 1,004 1,582 1,286 366 ,288 10,313 2 150 1,164 237 1,114 1,687 1,455 385 ,572 11,764 3 170 2,289 271 1,158 1,913 1,597 397 ,913 13,708 4 104 1,243 207 1,137 1, 774 1,328 393 ,970 12,156

1968 1 49 569 200 1,064 1,651 1,306 366 5,533 10,738 2 134 1,235 241 1,181 1,760 1,478 385 5,830 12,244 3 151 2,429 276 1,227 1,995 1, 622 397 ,187 14,284 4 94 1,319 211 1,204 1,850 1,349 393 6,246 12,666

1969 1 43 601 203 1,124 1, 719 1,326 366 s' 777 11,159 2 118 1,306 245 1,247 1,832 1, 501 385 6,088 12,722 3 133 2,567 281 1,297 2,078 1,646 397 6,460 14,859 4 82 1,394 215 1,272 1,927 1,370 393 6,523 13,176

1970 1 37 634 206 1,184 1,787 1,346 366 6,022 11, 582 2 101 1,377 250 1,314 1,876 1,523 385 6,346 13,172 3 115 2,707 286 1,366 2,160 1,671 397 6, 734 15,436 4 70 1,470 218 1,340 2,003 1,390 393 6,799 13' 683

r rounded to nearest 10 persons on an annual rate basis. s seasonally distributed using the following index numbers by quarters and industries shown.

Total Non- (a) (b) ( c) (d) (e) (f) (g) (h) Quarters Agric. Ernpl. Mining Contract Const. Mfg. Trans Comp. Whs. Ret. Service Fin. & R.E. Gov't 1 46 41 86 91 91 91 95 93 2 125 89 104 101 97 103 100 98 3 142 175 119 105 110 112 103 104 4 87 95 91 103 102 94 102 105

SOURCE: Authors' computations.

39 TABLE 11

DISTRIBUTION OF PERSONS IN THE FAIRBANKS ELECTION DISTRICT BY AGE AND .SEX, 1960

Total Male Female Age Group Num- Per- Cumulative Num- Per- Cumulative Num- Per- Cumulative (in years) ber cent Pent. ber cent Pent. ber cent Pent.

Under S 6,838 16 3,482 14 3,3S6 19 16 14 19 S to 9 4,663 11 2,377 9 2,286 13 27 23 32 10 to 14 3,098 7 l,S8S 6 l,Sl3 8 34 29 40 lS to 19 3,313 8 2,3SO 9 963 s 42 38 4S 20 to 24 S,972 14 4,232 17 1,740 10 S6 SS SS 2S to 29 4,69S 11 2,82S 11 1,870 10 67 66 6S 30 to 34 3,96S 9 2,311 9 l,6S4 9 76 7S 74 3S to 39 3,396 8 l,8S8 7 l,S38 9 84 82 83 40 to 44 2,626 6 l,S73 6 l,OS3 6 90 88 89 4S to 49 l,79S 4 1,089 4 706 4 94 92 93 so to S4 1,190 3 730 3 460 3 97 9S 96 55 to S9 784 2 484 2 300 2 99 97 98 60 to 64 492 1 332 1 160 1 98 99 6S to 69 272 * 1S7 * llS 1 70 to 74 lSS * 91 * 64 * 7S to 79 91 * S9 * 32 * 80 to 84 40 * 27 * 13 * 8S & over 27 * 20 * 7 * TOTAL 43,412 100 2S,S82 100 17,830 100

Under 18 lS,823 36.4 8,106 32 7' 717 43 6S & QVer S8S 1 3S4 1 231 1 Median 23.2 23.S 22.3

*Less than 1 percent

SOURCE: Bureau of Census

40 has not expanded. Manufacturing employment has declined. This is also 8 the case for agriculture, a sector excluded from the tables cited.

(4) Within the government sector, a breakdown of employment is not available in the detail desired. However, the following summary

comments are applicable. (a) Military employment has held up fairly well until recent reductions, which occurred in 1965 in conjunction with

the Vietnam War. ual t but

substitute indicators clearly substantiate this decline. (b) Non-

military federal employment has increased. Its growth is attributable

to a general expansion of federal government logistical activities in

the region, as well as to a centralization of federal employees in

Fairbanks as opposed to rural, northern and western Alaska posts.

(c) The state and local government employment component has expanded

steadily through 1966. This compo~ent is, however, potentially volatile.

Summary

The employment and earnings data, reviewed in this chapter, point

out the changing composition of regional economic activity. The Fairbanks

North Star Borough is exposed to sharp seasonal fluctuations in income

and employment in most if its major industries. Annual changes

shifts other than those identified in the regular seasonal pattern--are

regular and very small. The major changes identified in income and

employment were seasonal conditions. These also were a principal cause of

worker migration. In this respect, a leveling off of seasonality would

be an appropriate economic development goal. In the next chapter, changes

in the Fairbanks labor market are analyzed, including certain migration

factors. In addition, projections of the labor force are evaluated.

8 see Ernest Wolff and R. C. Haring, Natural Resource Base of the North Star Borough, for discussion of the agriculture and forestry sectors.

41 IV

POPULATION AND LABOR FORCE TRENDS

Employment growth in Fairbanks supports a regular flow of new additions to the labor force of about 490 persons annually. In recent years, the area's labor force expanded much more rapidly than employment opportunities. The compositicn of the population -- age groups, skills acquired and education attained is constantly changing and is very different from earlier periods. The changes occur through a combination of factors including Native immigration, increased high school and college graduations, and tra~sfers to Fairbanks from outside Alaska.

In recent years, reductions in the labor force were caused principally by out-migration. Mortality rates have approached the national average although relatively few wage earners retire in Interior

Alaska. Ultimately, out-migration must increase, including the loss of skilled laborers and educated young adults, unless the employment base of Fairbanks expands rapidly and in a manner conducive to their retention.

The purposes of this chapter are:

(1) To identify the population characteristics of the Borough and to indicate the demographic trends which are apparent.

(2) To examine migration factors and forecast labor force growth to 1975, and to evaluate labor force and employment trends through 1985.

42 Social Characteristics and Migration

A cross-section of population characteristics by states and sub­ regions is gathered by the Bureau of Census at regular ten-year intervals.

Intercensal surveys usually are less thorough, and normally are used to update the most current census report. In the Fairbanks areas, the census

detail 1950 than in 1960, but major shifts in the population are apparent. For example, the age and sex distributions for

these two periods are shown in Figure 3. The following conclusions, which

apply to Fairbanks, are apparent in analyzing that figure--

(1) The heavier proportion of males to females in the 20-55 year age group that prevailed in 1950 was nearly equalized by 1960.

(2) Persons of retirement age, over 60 years of age, have become a smaller percent of the population.

(3) The under-15 year age group has grown rapidly, and was nearly

twice as large in 1960 compared with 1950. Moreover, in Fairbanks this

condition obviously reflected a doubling of the per capita educational burden at a time when educational costs per student were also rising

rapidly. From 1960 to 1966, this growth in the school age population

continued at a rapid pace, a condition which is apparent in Tables 19-28.

In examining population changes, major factors of concern are birth

rates, mortality and migration. The incidence of these factors varies

among age groups and by race. Birth rates in the Fairbanks area, since

1959, are shown in Table 18 and Figure 4. The crude rates of 25-26

births per thousand population annually are relatively stable in Alaskan

43 urban areas. However, Native persons in Fairbanks accounted for a birth rate of approximately 60 per thousand, or more than twice the local all- race average. Overall, mortality rates in Fairbanks are 3.7 per thousand.

However, Native mortality remains at 8 percent per thousand. Considering the absence of retired persons and a high percentage of school age children in the local area, mortality conditions remain unusually high.

In the comb b rates in recent years, net population gains are occurring at an annual rate of 20-22 persons per thousand. Given a population of roughly 45,000 persons in the trade area, this represents a net addition factor of 1,000 persons to the population, considering crude birth and death rates, and correspondingly large additions to the supply of school age children. In comparison to

the 490 new jobs generated each year, the outlook of several thousand new additions to the labor force annually for the next fifteen to

twenty years almost certainly will cause net out-migration, unemployment 1 or both. (See Figure 4 and Tables 19-28.) Obviously, it will not

require fifteen years for these economic conditions to occur. Instead, out-migration of entire households will occur throughout the period,

resulting in a combined loss of trained labor and school age children.

1 Birth and mortality rates are, of course, age specific and readily available in standard mortality tables, such as the Statistical Abstract of the United States. Age specific data for this type are not available for Alaska. See George Rogers, "Alaska's Native Population and Poverty," (College: University of Alaska, mimeograph, 1965). For an advanced treatment of these questions, see F. Andrei Rogers, " Model of Population Growth in California Regions," in 1966 Papers of the Western Regional Science Association, (College: University of Alaska, 1967).

44 TABLE 12

POPULATION OF FAIRBANKS AND THE NINETEENTH ELECTION DISTRICT, 1910-1965 (In Persons)

Census Fairbanks Percent Change Fairbanks Percent Change Year City Limits (annual rate) District* (annual rate)

j 54-1 11,000(approxo) 1920 1,155 -6.7 2,182 -8. O(approx.) 1929 2,101 +8.2 3,446 +5.8 1939 3,455 +6.4 5,692 +6.5 1950 5, 771 +6.7 19,409 +24.1 1960 13,311+ +13.1 43,412 +12.4 1965 17' 800 (est) +9.0 45,000 (est) +3.0

*Although the area referred to as the Fairbanks District has not been the same in every Census, the changes have been roughly in accordance with the spread of the settled area and the increase in population in the places already settled. The District figures include the city in each case. In the 1920 Census the only places in the district which were large enough to be listed were Chena and Fairbanks towns and Chena (native), Garden Island and Graehl villages. The figures in the Censuses of 1929, 1939, and 1950 were for the Fairbanks Recording District. The 1960 figure is for the Election District, but the differences in the boundaries as compared with the figure for 1950 affected only a few small places, and the increase in population is almost entirely accounted for by the growth in Fairbanks itself, in Graehl and Hamilton Acres (since incorporated in the city) and in the large suburbs of College and Lemeta-Johnston.

+The large increase in the city population from 5,771 in 1950 to 13,331 in 1960, is accounted for by a growth of 2,545 (44.1%) in the former area in the city, and the annexation of some suburban areas with a population of 4,995. SOURCE: Bureau of Census

TABLE 13 RECENT ESTIMATES OF POPULATION FOR THE FAIRBANKS AREA

Census City Manager's Sales Manage- Authors' Fourth Judicial Dist. Year Estimate ment Estimate Estimate ) now obsolete) 1960 16,464 13,500 54,500 1964 69,600 1965 19,468 17,000 17,200 1966 17,800 59,700 SOURCE: As designated above.

45 TABLE 14

PERCENT OF INHABITANTS, AGE 25 AND OVER, ACCORDING TO YEARS OF SCHOOL COMPLETED FOR THE CITY OF FAIRBANKS AND FAIRBANKS ELECTION DISTRICT, 1950 AND 1960 1960 1960 1950 1950 City of Fairbanks City of Fairbanks Fairbanks Election Dist. Fairbanks Election Dist. Amount of Schooling Cum. Cum. Cum. Cum. Completed (in years) Pent. Pent. Pent. Pent. Pent. Pent. Pent. Pent. (1) None* .9 .9 2.4 12.8 12.8 (2) Elementary: 1-4 1. 2 1. 2 2.6 7.6 2.1 2.1 5.0 20.4 5-6 3.1 2.4 3.3 4.3 5.2 4.5 8.3 24.7 7 3.2 3.2 3.0 3.3 8.4 7.7 11.3 28.0 8 11. 2 10.1 15.8 13.0 19.6 17.8 27.1 41.0 (3) High School: 1-3 20.3 20.8 18.1 15.2 39.9 38.6 45.2 55.2 4 33.4 36. 3 30. 7 24.0 73.3 74.9 75.9 79. 2 (4) College: 1-3 17.2 15.0 15.1 13.0 90.5 89.9 91.0 92.2 4 and over 9.5 10.l 8.9 6.8 Median 11.8 years 11.8 years 11. 7 years 10.4 years *and not reported SOURCE: Bureau of Census

TABLE 15 PERCENT OF INHABITANTS, AGE 25 AND OVER, ACCORDING TO YEARS OF SCHOOL COMPLETED FOR THE UNITED STATES, ALASKA AND FAIRBANKS ELECTION DISTRICT AS OF 1960 Amount of Schooling United States Alaska Fairbanks Election Dist. Completed (in years) Cum. Cum. Cum. Pent. Pent. Pent. Pent. Pent. Pent. (1) None* 1.2 3.5 .9 2.3 3.5 .9 (2) Elementary: 1-4 6.0 4.6 1. 2 8.3 8.1 2.1 5-6 7.5 4.2 2.4 15.8 12.3 4.5 7 6.4 3.4 3.2 22.2 15. 7 7.7 8 17.5 10.6 10.l 39.7 26.3 17.8 (3) High School: 1-3 19.3 18.9 20.8 59.0 45.2 38.6 4 24.6 32.3 36.3 83.6 77. 5 74.9 College: 8.8 12.9 15.0 (4) 1-3 92.4 90.4 89.9 4 and over 7.6 9.5 10.l

*and not reported SOURCE: Bureau of Census

46 FIGURE 3

PROPORTION OF POPULATION OF THE CITY OF FAIRBANKS ACCORDING TO AGE GROUP AND SEX, 1950 AND 1960 (in percent of total population for year indicated)

9

7

5

3

.µ 1 i:: Q) 0 C) H L.__L_ Q) MALE - 1 1'.1-< l_L_L_ r-L 3 '-----L__L_~J - 5

- 7

9 rn H cu Q) :>-< O'\ -.:!" -.:!" 0\ -.:!" 0\ -.::t + Lf') -.:!" CV) CV) N N Lf') i:: Lf') '°I I I I I I I 0\ •ri Lf') 0 0 Lf') 0 Lf') 0 I " Q) " bO ~ 7

1950 5

3

.µ 1 i:: Q) 0 C) H Q) 1 1'.1-< MALE 3

5

7

SOURCE: Bureau of the Census.

47 FIGURE 4 SUMMARY OF BIRTH AND MORTALITY RATES IN THE FAIRBANKS ELECTION DISTRICT ACCORDING TO RACE, 1959-1965 Per (000) Population 80

-~ ,,.,,--- - ...... 70 / ...... /// ...... _ ___ -.- ____ _ ,; 60 ____

50 Ir--

40

Birth 30 Rates ------=====---- 20 -

10

1959 1960 1961 1962 1963 1964 1965

Per (000) Population ;-- ...... 14 _ I - 12 I "'- / _...... _ I ' '-"- 10 / _,,/ ...... / ""' // ...... ___ - _/

Mortality 8 Rates 6

4

2

1959 1960 1961 1962 1963 1964 1965 For all races White Native

SOURCE: Alaska Department of Health and Welfare

48 The number of Natives situated in Fairbanks is increasing much more rapidly than are the non-Native racial groups. This conditions is caused 2 principally by a higher natural growth rate among Natives, by in- migration of Natives from rural Alaskan communities and by labor immobility in the urban economy which retards subsequent out-migration. The natural growth among Fairbanks Natives is approximately 50 persons per thousand, more than twice as high as for non-Native persons. The movement of

Native households from rural communities to Fairbanks continues, but this rate has not been accurately estimated because of its seasonal character and because of the inherent difficulties in contacting new arrivals. Knowledgeable persons estimate this Native immigration at several hundred per year. Native families newly arriving and those already residing in Fairbanks face a widespread problem in becoming gainfully employed, The largest proportion of them is made up of persons who are relatively uneducated, unskilled and untrained when considering

the types of employment opportunities available. Employed Natives are

found concentrated in the unskilled, seasonally sensitive occupations.

While these conditions appear socially undesirable at first glance,

employment opportunities for Natives in most skills and job interests

(except fishing) are vastly superior in Fairbanks in comparison to

conditions in communities from which migration occurred. Specifically,

this out-migration occurred from areas with 40-60 percent actual unemploy- ment. These same factors also lead to a secondary problem in labor

immobility--without the skill and education, these same families are

virtually unable to leave Fairbanks for better job opportunities elsewhere.

2 Natural growth refers to net population change derived from births less mortality.

49 They are economically immobile, except in the sense of subsistence by living "off the land." These conditions lead to the following pro- visional conclusions --

(1) The natural rate of growth among the Fairbanks Native population, coupled with observed immigration, has resulted in a rapid growth of resident Native people. This rate of increase in recent years

(2) The observed population expansion will generate large demands upon the public school system, and most especially will require re- training and skill upgrading of adults. Unless such a program is force- fully instituted, seasonal and permanent unemployment will result at levels of 50 percent or more among certain ethnic groups.

(3) Out-migration of unemployable persons is unlikely and im- practical, and increasing local poverty will be a highly probable 3 result.

Education and Educational Composition of the Labor Force

Public Schools

The number and residential location of school age children have been major inter-censal indicators of population change and geographic dispersion of households since 1960. Persons under 18 years of age represent one-third of the area's population, and high school graduates from this group are significant additions to the labor force.

3 see Barbara Ure, Report on Comprehensive Community Mental Health Planning 1963-1964, (Anchorage: Alaska Department of Health, Education and Welfare, 1965).

50 .J...tUJl..JL ..LU

ESTIMATED ELEMENTARY SCHOOL BUDGETING CAPACITY AND UTILIZATION

FAIRBANKS NORTH STAR BOROUGH AS OF MAY 26 1 1967 (1) (2) (3) ( 4) ( 5) ( 6) (7) Number Present Utilization Room Use Present Educational Facilities Grades of Rooms Capacity Enrollment Col. (5) 7 4)xl00 Col. (5) 7 (3) Barnette K-6 16 400 484 121 30.2 Denali K-6 26 650 761 117 29.3 Hunter K-6 Sp. Ed. 24 600 715 119 29.8 Joy K-6 14 350 429 122 30.6 Nordale K-6 24 625 740 118 30.8 University Park K-6 20 500 601 120 30.0 North Pole K-8 8 200 204 102 25.5 Saleha 1-6 5 125 47 38 9.4 Two Rivers 1-4 1 25 12 48 12.0 Nenana Road 1-8 1 25 16 64 16.0 Adler 1-6 3 75 80 107 26.7 Birch (temporary) Sp. Ed. 2 30 0 --- TOTAL 3,605 4,089 lJ1 f-' TABLE 17 PROJECTED CONSTRUCTION AND ESTIMATED PUBLIC SCHOOL CAPACITY, FAIRBANKS NORTH STAR BOROUGH, ALASKA

Number Facilities Grades of Rooms Capacity Present Enrollment/Comments 1967-1968 School Year Adler K-6 6 150 North Pole K-8 21* 525 1969-1970 School Year Westgate K-6 20 520 Chena Hot Springs K-6 7 182 (Increase of 250 pupils per year anticipated) Elliot Highway 1-6 1 25 Nenana Road 1-6 1 --25.* (Replacement, no increase) SUBTOTAL 1,427 Present Facilities 3,925 4,899 (975 pupils over capacity) TOTAL Projected Facilities 5,352 *5 rooms of present facility plus 16 additional rooms. SOURCE: North Star Borough Schoo District TABLE 18

RECORDED BIRTH AND MORTALITY RATES IN SELECTED ALASKAN AREAS, 1959-1965 (Rates in number per 1,000 population)

Regions * 1959 1960 1961 1962 1963 1964 1965 - Birth Rates Anchorage 32.6 35.1 33.5 33.2 32.3 30.2 29.6

FAIRBANKS 33.0 33.3 31.6 30.5 30.4 28.0 25.6

Bethel 38.8 44.6 49.3 46.1 46.0 4(1 7 41.1

Barrow 37.0 43.5 36.6 43.1 37.0 44,9 45.0

Nome 36.8 35.5 29. 8 29.7 28.8 23.8 26.8 U1 N

Mortality Rates

Anchorage 3.6 3.6 3.3 3.8 3.6 3 6 4.2

FAIRBANKS 3.3 4.4 3.7 3.6 3.9 3.8 3.7

Bethel 9.8 8.8 12.2 10.7 6.5 7 9 11. 7

Barrow 10.6 5.1 6.3 9.9 3.4 9.0 4.4

Nome 10.5 8.0 9.8 5.1 10.5 7.2 4.7

*Election Districts

SOURCE: Alaska Department of Health and Welfare. TABLE 19

ENROLLMENT IN BARNETTE ELEMENTARY SCHOOL BY GRADE, 1960-1967

School Years (Pent.) Grades 1960- 1961- 1962- 1963- 1964- 1965- 1966- (1966-) (levels) 1961 1962 1963 1964 1965 1966 1967 (1967) K 64 63 82 74 78 74 61 (12. 6) 1 85 71 86 71 82 68 75 (15.5) 2 72 79 100 79 63 75 69 (14. 2) 3 64 52 96 71 67 65 79 (16. 3) 4 59 71 67 77 68 64 72 (14.9) 5 81 49 73 66 78 63 60 (12. 4) 6 59 54 63 57 66 75 68 (14.0)

TOTAL K-6 * 484 439 567 495 502 484 484 (99.9)

*Straight line least squares trend 1960-1967; T = 494 + 0.9x (in pupils).

SOURCE: North Star Borough School District

TABLE 20 ENROLLMENT IN DENALI ELEMENTARY SCHOOL BY GRADE, 1958-1967 School Years (Pent.) Grades 1958- 1959- 1960- 1961- 1962- 1963- 1964- 1965- 1966- (1966-) (levels) 1959 1960 1961 1962 1963 1964 1965 1966 1967 (1967)

K 121 127 121 145 178 139 129 114 111 (14.6) 1 159 155 167 133 178 127 111 123 112 (14.7) 2 126 143 136 142 126 133 113 111 125 (16.4) 3 99 114 136 124 119 102 114 107 106 (13.9) 4 93 92 103 133 128 113 100 111 99 (13.0) 5 126 97 86 84 108 110 107 100 108 (14.2) 6 _21. _fil 90 80 92 100 104 107 100 {13.12 TOTAL * 815 815 839 841 929 824 778 773 761 (99.9) K-6

*Straight line least squares trend 1958-1967; T = 819 - 8x (in pupils).

SOURCE: North Star Borough School District.

53 TABLE 21

ENROLLMENT IN HUNTER ELEMENTARY SCHOOL BY GRADE, 1959-1967 School Years (Pent.) Grades 1959- 1960- 1961- 1962- 1963- 1964- 1965- 1966- (1966-) (levels) 1960 1961 1962 1963 1964 1965 1966 1967 (1967)

K 80 61 119 107 128 101 103 99 (13.8) 1 108 111 111 94 123 123 120 109 (15.2) 70 9 96 114 126 (17 3 82 101 117 99 99 99 102 101 (14.1) 4 83 91 92 81 108 86 91 98 (13. 7) 5 69 110 85 71 68 106 90 98 (13. 7) 6 58 91 78 66 69 83 91 83 (11. 7)

TOTAL K-6 * 559 689 711 588 689 694 711 715 (99.8)

*Straight line least squares trend 1957-1967; T = 670 + 14.9x (in pupils).

SOURCE: North Star Borough School District.

TABLE 22

ENROLLMENT IN JOY ELEMENTARY SCHOOL BY GRADE, 1961-1967 School Years (Pent.) Grades 1961- 1962- 1963- 1964- 1965- 1966- (1966-) (levels) 1962 1963 1964 1965 1966 1967 (1967)

K 58 64 60 71 53 54 (12. 6) 1 53 76 75 51 74 69 (16 .1) 2 57 63 64 62 48 65 (15. 2) 3 48 79 57 57 68 57 (13. 3) 4 44 57 69 53 55 70 (16. 3) 5 49 56 54 55 64 54 (12.6) 6 49 57 59 51 68 60 (14.0)

TOTAL K-6 * 358 452 438 400 430 429 (100.1)

*Straight line least squares trend 1961 - 1967; T = 418 + 7.2x (in pupils).

SOURCE: North Star Borough School District.

54 TABLE 23

ENROLLMENT IN NORDALE ELEMENTARY SCHOOL BY GRADE, 19S8-1967 School Years (Pent.) Grades 19S8- 19S9- 1960- 1961- 1962- 1963- 1964- 1965- 1966- (1966-) (levels) 19S9 1960 1961 1962 1963 1964 1965 1966 1967 (1967) K 142 133 129 110 151 137 122 133 120 (16.2) 1 148 144 159 114 122 123 126 121 127 (17.2) 2 138 120 114 115 118 112 104 122 111 (lS.O) 3 132 ll3 121 99 110 109 (14, 4 122 102 110 101 101 95 98 98 107 (14.5) s 93 85 82 86 103 95 98 94 83 (ll. 2) 6 -2l 78 87 _]_.!!_ 86 87 103 99 88 {ll. 9) TOTAL K-6 * 868 775 802 699 791 7Sl 760 772 740 (100. O)

*Straight line least square trend 1958-1967; T 773 - 9.2x (in pupils).

SOURCE: North Star Borough School District.

TABLE 24

ENROLLMENT IN UNIVERSITY PARK ELEMENTARY SCHOOL BY GRADE, 1958-1967

School Years (Pent.) Grades 19S8- 1959- 1960- 1961- 1962- 1963- 1964- 1965- 1966- (1966-) (levels) 19S9 1960 1961 1962 1963 1964 1965 1966 1967 (1967)

K 29 S9 68 62 S8 88 74 105 77 (12.8) 1 so 4S 100 Sl 61 75 94 93 104 (17. 3) 2 Sl SS 73 52 51 79 102 85 81 (13. 5) 3 so 49 54 45 so 85 87 101 87 (14. S) 4 28 SS 56 31 48 83 98 94 92 (15.3) 5 32 32 29 40 31 66 85 96 81 (13. 5) 6 _]Q _li _ll ..22. __]_§_ 72 __]_'£ .-2.2. Ji {13. l} TOTAL K-6 * 270 329 413 320 33S 548 612 670 601 (100.0)

*Straight line least squares trend 1958-1967; T 4SS + 49.6x (in pupils).

SOURCE: North Star Borough School District.

SS TABLE 25

ENROLLMENT IN NORTH POLE ELEMENTARY SCHOOL BY GRADE, 1958-196 7

School Years (Pent.) Grades 1958- 1959- 1960- 1961- 1962- 1963- 1964- 1965- 1966- (1966-) (Levels) 1959 1960 1961 1962 1963 1964 1965 1966 1967 (1967)

K 22 22 (10. 8) 1 22 25 23 31 36 32 27 38 26 (12. 7) 2 20 26 23 27 34 35 29 39 24 (11. 8) 3 12 17 28 21 33 32 30 27 25 (12.2) 4 11 15 14 21 28 24 29 27 22 (10.8) 5 12 12 14 15 20 27 22 28 19 ( 9.3) 6 9 15 16 13 15 23 22 21 26 (12. 7) Subtotal 1-6 86 110 118 129 166 173 177 202 164 7 10 11 22 11 15 16 23 20 21 (10.3) 8 7 12 11 18 13 19 16 21 19 ( 9. 3) Subtotal 7-8 17 23 33 29 28 35 39 41 40 TOTAL K-8 * 103 133 151 158 194 208 216 243 204 (99.9)

* Straight line least squares trend 1958-1967; T = 179 + 15.2x (in pupils), SOURCE: North Star Borough School District.

TABLE 26 SUMMARY OF ISOLATED AREA ELEMENTARY SCHOOL ENROLLMENT IN FAIRBANKS NORTH STAR BOROUGH

(pent.) 1961- 1962- 1963- 1964- 1965- 1966- (1966-) Schools 1962 1963 1964 1965 1966 1967 (196 7)

Two Rivers 18 20 21 22 15 12 ( 8. 5) * Saleha 60 51 73 109 47 ( 61. 9) Nenana Road 11 10 10 16 ( 5. 7) Adler 49 42 80 ( 23.9) TOTAL 18 80 83 154 176 155 (100,0

*Military connected pupils entered during 1964-1965, In 1966-1967 some pupils were transferred to Eielson A.F.B. and some to Adler. SOURCE: Fairbanks North Star Borough School District

56 TABLE 27

ENROLLMENT IN MAIN JUNIOR HIGH AND LATHROP HIGH SCHOOLS BY GRADE, 1959-1967

School Years (Pent.) Grades 1959- 1960- 1961- 1962- 1963- 1964- 1965- 1966- (1966-) (levels) 1960 1961 1962 1963 1964 1965 1966 1967 (1967)

Main Junior High

7 354 355 366 3 404 Lf46 437 493 (SL; 9) 8 240 344 362 360 358 407 445 405 ( 45 .1) Subtotal 7-8 * 594 699 728 715 762 853 882 898 (100.0)

Lathroe High School 9 320 348 455 541 470 460 513 511 (30. 4) 10 294 248 293 372 429 401 424 444 (26. 4) 11 184 229 210 235 340 422 419 368 (21. 9) 12 134 145 187 190 248 312 367 356 ( 21. 2)

Subtotal 9-12+ 932 970 1145 1338 1487 1595 1723 1679 (99.9)

TOTAL 7-12 1526 1669 1873 2053 2249 2448 2605 2577

*Straight line least squares trend; T 766 + 41.2x (in pupils).

+Straight line least squares trend; T 1359 + 124.9x (in pupils).

Note: Eielson A.F.B. High School in 1965-1966: 9-13, 10-14, 11-12, 12-9, Total - 48; 1966-1967: 9-104, 10-85, 11-67, 12-55, Total - 311.

SOURCE: North Star Borough School District.

57 TABLE 27-A

TOTAL SCHOOL ENROLLMENT BY GRADE IN THE FAIRBANKS NORTH STAR BOROUGH SCHOOL DISTRICT, * 1961-1967+

SCHOOL YEARS (pent.) Grades 1961- 1962- 1963- 1964- 1965- 1966- (1966-) (Levels) 1962 1963 1964 1965 1966 1967 (1967)

K 557 640 626 593 604 544 8.4 1 564 653 626 614 637 622 9.6 2 581 562 596 569 594 601 9.2 3 506 586 548 563 575 559 8.6 4 493 510 569 532 540 560 8.6 5 409 462 486 551 535 503 7.7 6 387 415 467 501 557 505 7.8 7 377 370 420 469 457 514 7.9 8 380 373 377 423 466 424 6.5 9 455 541 470 460 513 511 7.8 10 293 372 429 401 424 444 6.8 11 210 235 340 422 419 368 5.7 12 --187 190 248 312 36 7 356 5.5

TOTAL 5,399 5,909 6,202 6,410 6,688 6,511 100.1

ANNUAL CHANGE +510 +293 +208 -278 -177

PERCENT CHANGE +9.4 +5.o +3.4 +4.3 -2.6

*The School District does not include Ft. Wainwright, Eielson A.F.B. or parochial schools.

+Due to insufficient data on grade level enrollments, Two Rivers, Saleha, Adler and Nenana Road Schools were not included. (See Table 26.)

58 TABLE 28

ENROLLMENT IN ELEMENTARY AND SECONDARY PAROCHIAL SCHOOLS, FAIRBANKS NORTH STAR BOROUGH, ALASKA 1960-1967

(1) (2) (3) + Year Elementary - High School - * Total (Annual Av.) No. Students No. Students Col. (1) + (2)

1960 320 93 413 1961 315 (M) 82 397 1962 308 92 400 1963 311 98 409 1964 332 125 457 1965 300 124 424 1966 304 128 432 1967 (est.) 301 129 430

+Immaculate Conception Elementary School

'}~ Monroe High School

(M) elementary enrollment May of year cited.

SOURCE: School Offices designated.

The geographic distribution of public school enrollment for 1959-1967 is found in Tables 19-28. The following conclusions are apparent:

(1) Several elementary schools are expanding rapidly while others 4 are stagnant or declining in enrollment. For example, University Park

Elementary School reflected more growth in enrollment until 1966-1967

4 Actual enrollment figures are very much "after the fact" as a population indicator. This is partially due to school bus reallocation of children from highly dense residential areas to schools with lesser demands upon their facilities. Also, enrollment represents families with school age children, but not those in a more senior stage of the life cycle.

59 than any other unit, while Barnette was stable and Nordale and Denali have declined in enrollment. The locations of these schools in residential areas and their estimated student capacities are shown in Figure 16,

Chapter 6.

(2) Average class size and apparent utilization of facilities differ significantly among the schools. To the extent that utilization

. ratios are a fair representation of the of the of 1~~ 1 education facilities, it can be said that certain schools are used more 5 efficiently than others. (See Tables 16 and 17.)

(3) Regional migration and relocation of families among neighbor- hood areas have made the forecasting of school enrollment extremely difficult. Apparently, relocation is caused by the following factors--

(a) increased income and wealth at a time when children are of school

age, (b) a strong preference for housing in areas with favorably rated

schools, (c) normal shifts from apartment living to home ownership,

(d) location of home near place of employment such as the University of Alaska, and (e) propensity to "live out," i.e., homestead or build one's own residence.

For example, the large year-to-year changes in enrollment shown in

Table 21 are not explained by the normal progression of each student

group from one grade to the next. The sources of change must be found in

out-migration and in population shifts within the Borough. Erratic

5 conversely, new schools (and additions) should be placed in neighborhoods with an expanding school age population for (a) better utilization rates and (b) reduced demand for bus travel. Table 16 is based upon certain arbitrary standards in defining "capacity," i.e., some schools are shown operating in excess of 100 percent of capacity.

60 changes of this type are apparent by reviewing the annual grade pro­ gression for each educational facility, by examining diagonal lines from top left to lower right in Tables 19-28,

(4) It is readily apparent that increasing demands will be placed upon the Borough's high school, technical and vocational programs and upon the University. Larger class enrollments, already present in the

schools, merely indicate how rapidly this expansion will occur.

Without significant employment growth, the regular out-migration of adults as their education is completed is inevitable. If the employment base of the Borough does not expand immediately, the local costs of education per gainfully employed person will continue to rise rapidly.

Cross-Section of the Adult Labor Force

The median level of education attained by household heads in

Fairbanks is clearly higher than reported in other U, S. regions. A comparative educational profile is presented in Tables 14 and 15. To a considerable degree, this high education level is to be expected for the following reasons:

(1) Governmental agencies are the major employer industry, as discussed in Chapter III, and their personnel policies dictate mandatory minimum education levels as a condition of employment. Examples are the civil service register, corresponding public service examinations and specialized positions at the University of Alaska.

(2) The relative scarcity of persons over 45 years of age operates to the benefit of an artificial picture of regional educational achievement.

61 FIGURE 5 FIGURE 6 EMPLOYMENT, NON-AGRICULTURAL, AVERAGE MONTHLY INSURED UNEMPLOYMENT, FAIRBANKS LABOR MARKET AREA FAIRBANKS LABOR MARKET AREA

11,500

11,000 375

10,500

350

10,00

9,50 325

1962 1963 1964 1965 1966 1962 1963 1964 1965 1966* SOURCE: Alaska Department of Labor *Based on first six months.

SOURCE: Alaska Department of Labor

62 (in thousands of persons) 50

40

30 Election District

20

10 Fairbanks

1910 1920 1930 1940 1950 1960 1966

FIGURE 7

POPULATION OF FAIRBANKS AND THE NINETEENTH ELECTION DISTRICT, 1910-1966

SOUkCE: From Table 12, page 45

Most adults of the Fairbanks population were in high school and eligible

for college at a time when successful completion of a degree was already

generally considered an occupational necessity.

(3) Much of the resident labor force is comprised of persons who

had immigrated from other U. S. regions to accept positions in the

Borough. One would expect recruitment of persons with more than "average"

skill and educational background.

(4) The major groups of uneducated and unskilled persons have

remained a small proportion of the overall population. The skill-

education level of the Fairbanks labor force will begin to reflect

declines unless the second generation of these groups are better trained

and educated than their parents.

63 (5) Both husband and wife are employed full time in a relatively large proportion of families. Of necessity, this condition has encouraged planned educational and job training patterns for women,

Population Trends and the Labor Force

Changes in the population of the City of Fairbanks and the overall election area from 1910-1966 are shown in Figure 7 and Tables 12-13.

From these, several conclusions

(1) The population of the Fairbanks area increased by 35,000 from

1940 to 1960, and this comprises a major growth trend. However, the trend in population growth was not maintained from 1960 to 1967, and out­ migration became a serious problem.

(2) The city's population has increased principally through annexation.

(3) From 1962-1966, the labor force grew more than employment.

This condition was a major cause of the increased out-migration and curtailed population growth.

Analysis of Alternative Growth Trends

The number of adults situated in the Fairbanks area is potentially volatile, and it is very difficult to predict the number who will remain over periods in excess of five years. For the most part, the urban popul­ ation level eventually is dependent upon prevailing employment conditions.

An expansion of the economic base is critical, and positive steps should be taken to stimulate employment and income growth. The economic structure of the Borough is examined in subsequent sections of this report, with special emphasis upon the areas in which growth might occur.

64 v

STRUCTURE OF THE REGION'S ECONOMIC ACTIVITY

The employment, earnings and population patterns, which were identified previously, are conditions reflecting economic activities in the Borough area. Technically, the Fairbanks North Star Borough region contains little or no "basic industry. For example, employment and 1 income which are generated from mining are declining. Manufacturing industries are in reality assembly industries. Notable among such industries are elementary fabrication and furniture rebuilding. In addition, one normally finds commercial printing listed as manufacturing, when actually it is a "service" industry. The main advantage of basic manufacturing to an urban area is that this sector exports goods and services to other areas. However, no manufacturing-export industry exists in Fairbanks which is of any substantial size. The major export industries of the Borough are tourism and federal governmental expen- ditures. Tourism is the major exporting industry which is not directly dependent upon federal funds.

There are several purposes of this chapter --

(1) To specify the region's economic activity in terms of an input/output model.

(2) To analyze the economic ties among industries and sectors within the planning area.

1 see Wolff and Haring, Natural Resource Base of the Fairbanks North Star Borough, (College: University of Alaska, 1967) for an examination of natural resource-based industries.

65 (3) To identify, in a preliminary fashion, which industries are likely to prosper and the probable effects upon the economic base when that growth occurs.

Input/Output Framework

The. or indus ries the Fairbanks North were examined in terms of the market to which their goods and services were sold. These annual transactions represent important economic ties between industries which are thought to be highly stable over a period of several years. In order to facilitate the review and analysis of these

economic ties and relations, they were assembled in a regional input/output 2 transactions table, shown in Appendix A.

Some Definitions

Unit of account. The transactions table is expressed in terms of

employment as a unit of account. That is, an industry's sales are divided

among markets (buyers) and the employment in each is allocated proportionally

to those market shares. For example, in the contract construction

industry, 57 percent of the products are sold to state and local government

as a sector. Therefore, 57 percent of the 1,229 employees in contract con-

struction are allocated to that transaction. (See Appendix A, Row 2,

Column 9.)

Reading Transactions. The transactions table is comprised of rows

(on the left, numbered 1 to 12) and columns (across the top, numbered 1 to 12)

2 This form of input/output matrix is unique to regional models and called a "rows only" convention. See Charles Tiebout, Community Economic Base Study, (New York: Committee for Economic Development, 1962); and William H. Miernyk, Elements of Input/Output Analysis, (New York: Random House, 1965), pp. 69-75.

66 Three additional columns are shown, consumption, investment and export; and these columns represent categories of final demand in the model.

Several examples are appropriate to demonstrate how the transactions table is interpreted. They are --

(1) Transportation (industry 4) sells its services predominately to contract construction and governmental agencies, and approximately

60 percent of 's is allocated to shown across row 4.

(2) Industries 6 and 7, comprised of wholesale and retail trade and services, sell substantially to local construction, but also on contract to the military establishment. In addition, a significant volume (one­ seventh of output) is allocated to the export column. This represents principally transactions to persons who are not residents of the Borough, i.e., outsiders who buy here as tourists.

(3) Manufacturing (industry 3) is depicted as selling principally to three markets; to the contract construction industry, to government and for home construction. Examples are the manufacture of expanded plastic insulation and of other construction,materials and the sale of these materials to builders and households.

The interpretation of certain entries is not entirely obvious. The following special considerations are noted

(1) The relationship among governmental agencies, shown as industries

9, 10, and 11, indicates a high degree of dependence of state and local

67 employment upon federal transfer payments. In the case of federal military expenditures in Alaska, services are "sold" in export, representing almost entirely the sale of military "protection" to the rest of the

United States.

(2) Tourism also is considered an export because products are sold to people who reside in other states and countries. Typically, these persons move to Alaska on a very short-term basis and spend funds here.

Conversely, Alaskans who vacation "outside" represent a "leakage" from the local economic base in terms of reduced spending and consumption.

(3) The employment relationships which are apparent in the transactions table suggest that employment will change proportionately with increases in sales. However, this implication is substantially incorrect for the

Fairbanks North Star Borough. For example, an increase of 20 percent in retail and wholesale sales within the Borough area would not cause a

20 percent increase in employment in industries 6 and 7, Instead, the employment multiplier would probably be only 2 to 3 percent,

Rounds of spending. The transactions among industries, as discussed previously, are highly interrelated. For example, it is readily apparent that Interior Alaska's contract construction industry is largely, and ultimately, dependent upon government spending. The linkages among industries are specifically demonstrated in the transactions table

(Appendix A). These linkages appear in the following way: Contract construction (industry 2) sells its products principally to governmental agencies (industries 9, 10 and 11), Federal agencies, in turn, sell services (funding) to the state and local government units. The

68 ultimate source of funding for contract construction is federal spending,

although this is disguised locally as construction for state agencies highways or the University. Note also that a significant portion of

employment in the trade and services industries is dependent upon

"exports," sales to persons outside the Borough, principally tourists

and residents from smaller communities. In this way, the spending and

emp of one indust oth d cted If

traces out repetitive rounds of spending, all of the employment is 3 allocated eventually to final demand.

Final demand. Estimates of the final demand which result from the

transactions table are shown in Table 29. They represent sources of

economic growth during the period of study. This table clearly points

out the growth "imbalance" situation in Fairbanks. For example, the

following special conditions are apparent --

(1) Ultimately, governmental activities (industries 9, 10, 11)

accounted for 90 percent of all "exports" and approximately 60 percent

of consumption. This amount of governmental activity is extremely high

in comparison to other regions and represents a heavy dependence upon 4 federal spending.

3 rn practice, three rounds of spending account for nearly all the final demand entries, a condition which suggests substantial income-multiplier "leakages," Cf. R. C. Haring, "The Employment Multiplier Impact of Defense Spending in Alaska," 1966 Papers of the Western Regional Science Association (College: University of Alaska, 1966). 4 see, for example, William W. Peek, An Economic Model of Butte County, California (Chico, California: Chico State College, 1965).

69 TABLE 29

FAIRBANKS NORTH STAR BOROUGH FINAL DEMAND, 1965

(In Persons)

Industries Final Demand Sources I II III Consumption Investment Export

Mining 1 o.o 0.0 103.9

Contract Construction 2 0.0 138. 7 o.o

Manufacturing 3 61.3 12.2 24.4

Transportation 4 23.5 5.9 o.o

Public Util. and Communications 5 478.1 30.9 o.o

Wholesale and Retail Trade 6 965.4 60.3 482.7

Services 7 630.2 10.5 210.1

Finance and Real Estate 8 216.3 0.0 0.0

Government - State and Local 9 3,476.8 0.0 2,804.0

Government - Fed. Non-Mil. 10 241. 8 0.0 2,188.0

Government - Military Est. 11 0.0 0.0 5,344.4

Agriculture 12 20.0 0.0 0.0

TOTAL 6,113.3 258.6 11,162.6

SOURCE: Appendix A

70 (2) The community economic base rests upon two especially weak market conditions: (a) the absence (noted earlier) of well-developed

manufacturing and agricultural industries and (b) the lack of significant

nearby trading areas where inter-regional costs advantages might arise.

(3) The region is particularly exposed to externally generated

recessions such as changes in federal fiscal policy which could cause

a the flow of funds through federal agencies in Interior

Alaska. For example, in 1965-1966, federal construction declined with

the reallocation of federal spending brought on by the Vietnamese War.

The likelihood of recessions of this type is especially strong in areas

which are dependent on national defense expenditures and on contract

construction, such as highways and other federally funded programs.

Requirements tables. Another method of analyzing the ties among

the community's industries is found in Appendix B, which is labeled the

Direct and Indirect Requirements Tables. These tables were constructed

from Appendix A and also are measured in terms of employment. However,

they reflect the procurement activities of the purchasing industries,

For example, when the mining industry (column 1, Appendix A) expands to

the point of hiring another hundred employees, one would expect only an

increase of 3.3 persons in the local community to support this expansion;

in this case, in the finance-real estate sector. Other increases in

economic activity, directly attributable to minerals industry expansion,

would occur outside of the Fairbanks North Star Borough. In column 2

of the direct requirements table, the situation is more complicated.

71 Contract construction, as it expands by a hundred employees, would generate increases in employment in seven other industries in magnitudes from approximately 1 to 7 persons.

The direct requirements table is, of course, a simplification of what occurs when sales and buying by an industry actually increase or decrease. In practice, as sales to the contract construction industry increase and additional workers a ( ed and general laborers), corollary procurement occurs in the purchasing of supplies, in financing and in insurance services. Also, a general increase in local consumption eventually occurs. That is, the economic linkage between industries occurs as dollar volumes of transactions, while Appendix B reflects only the average employment connecting ties (coefficients).

However, in forecasting the employment to support economic growth, these labor requirements are especially useful and appropriate,

The indirect labor requirements, also presented in Appendix B, reflect direct requirements (as discussed) and all related purchases which eventually result within the Fairbanks North Star Borough. In the case of the contract construction cited, the indirect spending ties relate to secondary businesses which benefited from selling goods and services to suppliers of the contract construction industry. Also, indirect spending ties include the local consumption purchases of workers employed by these expanding industries. All in all, this table shows

the total anticipated benefits which would accrue on the basis of the expansion in any industry to all other industries shown, reading down

the column of the indirect requirements table. For practical purposes,

the indirect requirement coefficients reported were quite realistic, and

72 they appear to account for the large amount of "value added" which accrues to distributors and manufacturers located elsewhere in the

United States. Conversely, the amount of value added (and additional employment) which occurs in Alaska from this expansion has been relatively 5 small.

Demand Analysis Orientation

The input/output model, which was discussed in the previous sections of this report, is demand (or output) oriented. The input side of the

transactions framework is very limited. The model is a partial analysis based upon sales among the Borough's major employment industries and sectors, and it does not include a full analysis of the products they procure. For example, when Seattle-based firms are awarded construction

contracts in Alaska and they procure their supplies mainly from the

Pacific Northwest, this type of buying is eliminated from the model

almost entirely, since virtually nothing is procured from other Alaskan

industries. Similarly, wholesale and retail stores typically purchase

almost all of their inventory (costs of goods sold) from regions outside

the Fairbanks North Star Borough. In the case of the Borough, the

absence of additional input detail is not serious at this time because

its usefulness is predominately in analyzing the role of "basic" industry,

as discussed earlier. Only a limited amount of value added occurs in

Interior Alaska as goods move through production and distribution.

Practically no production occurs in Alaska for goods sold in the Interior.

5 see Miernyk, op. cit., pp. 24-28. Note also that direct and indirect requirements may not be stable from year to year.

73 The value added in marketing institutions is limited to their gross margins on operations, and in the manufacturing industry the value 6 added is very small.

Inter-industry Analysis

Spending and employment changes. As business activities in the

Borough expand seasonally, the rate of increase in each industry is not uniform. An expansion of sales and output in wholesaling and retailing, though large in dollar volume, does not require a similarly large increase in man-hours utilized to support this growth. Consequently, the employ­ ment gains are relatively small. As construction and home building expand each summer, man-hours utilized in fabrication of house building materials and in the construction trades grow quickly and proportionally.

In perspective, the construction and house building materials industries are much more "basic" and manufacturing-like, while the wholesale and retail businesses are clearly "non-basic" in character. The Fairbanks

North Star Borough economic base is comprised largely of "non-basic" industries such as trade, services, hotels and motels and professional services. Consequently, the employment response in these services due to a seasonal expansion in construction and public works is usually very small.

Seasonality restricting growth. The sharp monthly fluctuations in spending and employment which were identified in Chapter III seriously

6 In Bureau of Census, Census of Manufacturers 1963.

74 reduce the capacity of the economic base to expand year to year. These seasonal fluctuations in sales and employment were so sharp that the following results have been observed --

(1) Many businesses are dormant for long periods in the winter with resulting idle capital and inventory investment.

(2) Employees migrate out of the area after working one season, and this condition tends to increase labor Consequently, businesses face the difficult problem of retraining a substantial portion of their employees each year.

(3) Seasonal fluctuations are so sharp that sales forecasting is very short. Consequently, many firms are improperly stocked in terms of inventory, resulting in an insufficiency of product lines.

(4) From the workers' point of view, sharp seasonal fluctuation in employment opportunities often is undesirable compared with the more stable employment conditions elsewhere. Except for employees in industries where extremely high wages are paid, skilled workers tend to migrate to more stable employers.

Inter-industry transactions, as discussed, disappear during the slack periods of economic activity. For the most part, these seasonal

conditions retard growth of a stable and diversified industrial expansion.

These conditions are the proximate cause of short-term planning, high

labor turnover and expensive costs of operations, as discussed below.

Price-cost relations. The product selling prices of businesses and

industries in the Borough do affect their short and longer term growth

75 potential. These conditions are apparent in the input/output model and are substantiated in various surveys. For example, growth of agricultural output is impeded by lower in-bound freight rates (including air service) and more rapid delivery of fresh and frozen products from the Western United

States, Conversely, Interior Alaska's farmers face increasingly fierce price competition from outside producers when local supermarkets are able to discounts (See Chapter VII.)

As additional phenomena is that Fairbanks consumers have benefited from seasonal "dumping" of products overproduced in other regions, and from substantial seasonal price concessions. In the main, these marketing activities have improved the consumer price situation, especially in the case of the food price index. However, the growth of an agriculture sector in the local economy has been discouraged, rather than stimulated,

Seasonal difficulties plague the house building materials producers and have retarded the growth of an Interior Alaskan forest products industry. Expansion of saw mills and house log firms and the economic feasibility of a pulp mill have been seriously hampered. Construction and building materials dealers purchase by carload lots and at quantity discounts, receiving a wide mix of construction products from outside suppliers. Interior Alaskan industries are able to produce only very narrow product lines on intermittent production schedules. In the face of these product line and marketing disadvantages, many local businesses have elected not to purchase from Alaskan suppliers even at apparently 7 competitive prices. Other industries are also plagued by an adverse

7 See R. C, Haring and M. R. Massie, Survey of the Alaskan Forest Products Industry. (College: University of Alaska, 1966), pp. 75-81.

76 price-service position caused by persons making mail order purchases from national stores with liberal credit conditions, seasonally discounted 8 prices, and exempt from local sales taxes.

The major price-cost considerations which affect local economic development are:

(1) Three categories of living costs -- housing, food and transportation -- comprise approximately 70 percent of consumer expenditures. For local businesses, the costs of construction and of vehicle maintenance are disproportionally large in comparison to other

U. S. regions.

(2) The overhead costs-of-doing-business, such as utility charges and insurance (especially fire insurance rates), are particularly high in

Fairbanks. Commercial and industrial utility rates for comparable services were estimated at more than four times the prevailing level in 9 Seattle and nearly twice that of Anchorage, Alaska.

(3) Desirable business and industrial land remains in short supply considering the existing selling prices. Agricultural lands remain in scattered acres and uneconomic sizes and much of the land is uncleared and unreasonably priced.

8 cf .·A. D. Browning, Survey of Financial Institutions and Practices in the Fairbanks North Star Borough for 1966 (College, unpublished M.B.A. Thesis, University of Alaska, 1967).

9 Cf. R. C. Haring, Prices and Costs in the North Star Borough, Alaska. (College: University of Alaska, 1965), pp. 164-167.

77 (4) In heavy equipment purchasing, Interior Alaskan industries face considerable transportation charges and "setup" expenses which regularly represent as much as 45 percent of total capital costs.

(5) The level of labor costs in Fairbanks (excluding overtime and fringe benefits) has risen at approximately 6 to 8 percent annually in recent years.

(6) The relat 1 ial the fluctuations in sales limit the economies of large scale production and marketing activities in the region. Average costs of doing business are higher than elsewhere.

(7) The existing sales tax structure operates to the disadvantage of city businesses in favor of firms located outside the city.

(8) The largest proportion of consumers are left with very limited amounts of discretionary income and savings. The amount of money available after paying the costs of housing, food and minimum upkeep of the family is relatively small. Many consumers operate on a limited budget and are especially price-conscious.

The limited employment growth which has occurred in a few of the

Borough's support industries is directly attributable to adverse local pricing. Expenditures are siphoned away from the local economy to be used in purchasing from businesses in other areas, and there is movement of individual and business savings out of the community. By most standards of comparison, these practices retard growth and represent a serious economic development problem.

78 Growth Potential

It is apparent from the preceding analysis that there are several ways in which economic growth might be attained more rapidly than observed from a study of the past decade. Broadly conceived, these measures could be used to expand the export base to produce import substitutes, to stimulate the contra-seasonal use of facilities and employees and to establish more effective inter-industry linkages within the Borough.

Each measure is discussed below.

Expand Export Base

The Borough's export base is presently dependent upon federal government expenditures, tourism and small amounts of trade with northern

Alaskan points. The export base could expand through an increase in mining activities and the backhaul of processed goods to Anchorage, such as styrofoam and local handicraft products. Non-military governmental agencies could increase the export "services." For example, at the

University of Alaska additional student enrollment and research grants from outside the Borough operate in this export-like fashion. Similarly, non-military federal construction, such as the recent federal water pollution laboratory, tend to have the same type impact. Over several decades, the position of Interior Alaska's tourist industry will be very important. A continuation of the operation of the A-67 Centennial Site, and a growth in guide, packer and tourist facilities are particularly desirable. Certain public policy decisions, such as the issue of Pan

American stopover rights, are especially critical to the long-term 10 expansion. o f tra d e an d service . in . d ustries. .

10 see Barry Jackson, "Transpacific Route Investigation-Testimoney to be Submitted by Fairbanks Parties at Honolulu, February, 1967," (Fairbanks, Alaska: unpublished report, January, 1967).

79 The Borough's short-range trade position could be improved in several ways. Expanding the logistic role of Fairbanks in serving

Interior, Northern and Western Alaskan communities would cause local income to expand. This expansion is limited by the inability of local businesses to price competitively and by the relatively high freight rates charged by air and water carriers. As logistic support grows, discussed in Chapter VII, an indirect expansion of other local industries will begin. The Fairbanks-Anchorage highway (paralleling the railroad) and the proposed connecting roads north and west to established communities probably will generate a gradual improvement in pricing and income growth. An increase in manufacturing, such as in forestry and the assembly industries, requires new investment capital in the community.

The superficially ample natural resource position of the Borough alone is not sufficient to accomplish this, and new industries will enter the marketplace only when marketing conditions are profitable.

Import Substitutes

By producing locally goods which previously were brought in from outside, a new source of employment and income growth may arise. In view of the economic development record in other U. S. regions, local agricultural production usually is a foundation industry. Initially 11 it. prospers as an import. su b stitute . an d 1 ater as a major export in. d ustry.

Considering that the largest segment of final demand in the North Star

Borough is represented by government purchases, there is very little hope of attracting a diversified manufacturing base in the next 15 to 20 years.

11 see Harvey Perloff, Regions, Resources and Economic Growth, (Washington: Resources for the Future, Inc., 1960).

80 The wide introduction of import substitutes as a source of growth is a very real short-range development possibility. The major opportunities are found in agriculture, forestry and fisheries. To a much lesser extent, fabrication might occur locally, but the amount of value added in manu- facturing in the Borough would be very small.

Contra-Seasonal Activities

Existing businesses might undertake work during what is normally considered the slack period. This includes the shifting of contract construction firms from public works to private building contracts, and the general continuation of manufacturing trade when seasonal sales volumes are declining. To a considerable extent, this type of expansion runs in direct opposition to the best "profit" interests of business and industry. A few examples are appropriate. Recent shortages in high-quality housing, properly situated, indicate narrow and restricted demand for off-season building. Longer term contracts, which allow for weather protected construction during winter months, are adaptive tech- niques which would assist this industry. An expansion of winter activities,

especially recreation and tourism, is a possibility although its impact

in the next ten years probably will be modest.

Expansion of economic activities contra-seasonally in the face of

the severe weather conditions of Interior Alaska is a most expensive and 12 hazardous method of generating economic development. In addition,

l ZB usiness· opportun1. t ies ' in . t h ese areas are more preva1 ent th an common 1 y believed, Considering the short supply of competitively priced camp trailers and chassis mount campers, a contra-seasonal assembly and build-to-order plant could operate successfully. Similar opportunities probably exist in alcohol byproducts of potatoes, pre-built wood and plastic components for residential construction and the assembly of many durable goods that could be shipped unassembled at great cost saving.

81 this policy is less advisable because of the social costs of supporting a larger population throughout the winter, for example, larger school enrollments at a very time when personal incomE: and tax revenue are declining. A good many household heads are unemployed several months of

the winter and could work part time in unskilled positions. This solution

is apparently desirable. However, recent surveys indicate that skilled workers (receiving high summertime wages) are very unlikely to return to

lower income unskilled jobs off season. Some members of the labor force

are unwilling to work for reduced wages during the off-season and have

c h osen to receive. unemp 1 oyment compensation. instea . d . 13

Industry Linkages

The preceding analysis of industry transactions revealed that

Fairbanks wholesalers, retailers and building materials suppliers might

easily perform additional marketing and logistics functions to support

construction activities and the government sector. Purchasing and

procurement practices of nearby military establishments and local federal

agencies are critical. An analysis of the awards of prime military and

federal contracts in the area reveal that the vast proportion of procurement

occurs from out-of-state firms. In addition, the proportion of local

purchasing and contracting transactions which are directed to the

Fairbanks North Star Borough is declining. (See Table 30.) The fact

that Fairbanks businesses and industries have not been able to acquire a

greater share of the Interior Alaska federal procurement market is probably

attributable to the following reasons, which are listed in order of importance

13 cf. R. c. Haring, .2.R!__.sit., pp. 159ff.

82 TABLE 30

SUMMARY OF PURCHASING AND CONTRACTING ACTIVITIES * BY THE NATIONAL MILITARY ESTABLISHMENT IN THE FAIRBANKS AREA, FISCAL YEARS 1960-1966 (in thousands of dollars)

Category of FISCAL YEARS Expenditures 1960 1961 1962 1963 1964 1965 1966

1. Total Purchasing and Contract Expenditures Eielson A.F.B. 5 ,071 5,353 4,014 4,013 2,801 4.310 4.426

Ft. Wainwright N.A. N.A. N.A. N.A. 6' 715 5' 712 7,931

2. Total Spent in Alaska

Eielson A.F.B. 4,199 2.868 2,304 2,737 1,756 2,400 2,868

Ft. Wainwright N.A. N.A. N.A. N.A. 3,437 2,816 3,826 [2,583]+

3. Spent in Region (in percent)

Eielson A.F.B. (83) (54) (57) (68) (63) (56) N.A.

Ft. Wainwright N.A. N.A. N.A. N.A. (51) (49) (48)

*Contract construction awards by U. S. Army Corps of Engineers are separate from P. & C. activities presented in this table. Approximately 27 percent of Alaska heavy construction contracts are designated Interior Alaska, and annual fluctuations are substantial.

+Spent in Fairbanks. N.A. Not Available

SOURCES: Purchasing and Contract Offices designated; and U. S. Army Corps of Engineers (Anchorage).

83 (1) Insufficient equipment and staff to bid on most major contracts. Consequently, many Fairbanks contractors and suppliers 14 operate on the second and third tier of this market.

(2) Inability to compete in price and service.

(3) Lack of information about what is being bought and how to go about bidding for government contracts.

Applications of the Planning Model

The input/output model presented in this chapter has many uses in community planning. It was introduced as an analytical tool in exploring economic relationships among industries and also provided a means of evaluating alternative ways of generating economic growth or thwarting recessions. In terms of forecasting economic development and programming the impact of new industries, this I/O framework is even more practical.

Several examples of its uses are listed as follows --

(1) When a new industry enters the community, the model may be used to re-estimate levels of demand and trace out the likely employment impact of the additional investment in the community. From this and related models, one can readily estimate what types of businesses would be able to sell their products to a new industry and forecast the employ- ment and income generated by serving this new market. In this way, existing and new industries can examine the sufficiency of the community's economic base in servicing an industrial expansion.

14 Charles Beasley and Robert Haring, Marketing Cement Products , , , , (College: University of Alaska, 1965),

84 (2) As federal purchasing policies and practices change, these new conditions should be superimposed upon previous ones, thereby

analyzing the shifting of public sector markets. In addition, the

increase and exodus of military personnel and the changing operations

of non-military federal agencies should be gauged in terms of local

consumption and housing demands, as well as in terms of the obvious

procurement practices 0

federal government (and indirectly through state transfer payments)

is especially critical in the Borough, and should be reappraised often.

(3) As existing businesses and industries expand sales or enter

new product lines, final demand and export transactions could be readily

appraised. For example, the expansion of lumber mills into a full

product line for marketing to the contract construction industry would

have major positive employment and income effects through several industries.

"Buy locally" programs should be continued, and wide dissemination of

product information about the local economic base should be readily at

hand. All in all, this I/O model is a planning tool for forecasting the

roles of new businesses and expanding industries that are required to

support growth in the Fairbanks area.

(4) One longer-term and critically important role of this model

in community planning is: Where do we expect people to be employed in

the next year; in 1970 and over several decades? With the present

economic base of Fairbanks, a continuation of these economic conditions

will support only a slow growth of the observed jobs and professional

positions which were depicted in the transactions table. Unless conditions

85 I change materially, no significant number of employment opportunities will be available locally. Skilled and professional staff will out- migrate. Existing residents will leave the Borough to be gainfully employed.

A major use of this model is the forecasting of longer term labor requirements. Forecasting some twenty and thirty years ahead, regional

t of the type of question: "What kind of economic base must Fairbanks possess to sustain a population of a hundred thousand people in the year 1980?"

There are only a few feasible alternative ways of building an industrial base to sustain that population. Each alternative is manifest in a particular type of transactions matrix and composition of final demand. In summary, the input/output model of the Fairbanks North Star

Borough represents what has been going on in business, industry and government within the geographic area. Economic growth must occur to support a gainfully employed and increasing population. Obviously, the recipe for the desired economic growth is found in an input/output table far different from that observed for 1965-1966 and a correspondingly different economic base.

86 VI

SPATIAL DISTRIBUTION OF INDUSTRY AND HOUSEHOLDS

The development and expansion of the Fairbanks economic base are reflected in changing land use patterns. The urban business district, at one time tightly concentrated in downtown Fairbanks, is now more

ed the urban and s 0 the sparsely settled housing areas, the surrounding farm lands and much vacant land have now been developed into new subdivisions. The historical pattern of the location of these facilities is shown in this chapter.

The concentration of industry and businesses within the present urban and suburban areas is identified, as well as a shifting pattern of house- holds and an increase in housing density.

The purposes of this chapter are:

(1) to identify the changing spatial distribution of the

Borough's industries and households up to 1966.

(2) to estimate the spatial requirements for various industries and to indicate the probable direction and pace of building with respect to different kinds of economic growth patterns.

Historical Changes

The physical location of industrial enterprises and households in the Borough have changed continuously. Several major factors have caused

these spatial rearrangements in the last ten years.

87 (1) As population and employment in the market area expanded, 1 subdivisions were built and the city limits were extended. Electricity and telephone services were extended throughout the Borough while water and sewer utilities lagged behind city annexation. To a certain extent, the construction of new access roads in rural areas of the Borough also has been associated with sporadic home construction at locations several

les

(2) With the changing levels of income and composition of occupations in the area, the older sections of the city deteriorated and gradually 2 are being replaced.

(3) There was a rapid spurt in apartment house building during the period immediately after World War II. This has continued, although at a somewhat abated pace since 1955. During the same period, more liberal federal subsidies and insurance (G.I. loans and F.H.A. insurance) stimulated increased housing construction. Since 1959, the area has experienced sharp seasonal changes in vacancy rates, and vacancies have been estimated at 3 30 percent of rental units on an annual basis.

1 See, for example, Richard A. Cooley, Fairbanks, Alaska, A Survey of Progress (Juneau: Alaska Development Board, July 1954); several reports by R. W. Beck and Associates (1954-1961); reports by Clark-Coleman and Associates (1959-1960); North Pacific Consultants, Economic Analysis of Fairbanks and Contiguous Area, Alaska (Fairbanks: Golden Valley Electric Association, Inc., January, 1959).

2 western Real Estate Research Corporation, Marketability Survey: Central Downtown Area, Fairbanks, Alaska (Anchorage: Alaska State Housing Authority, 1959).

3 Cf. R. C. Haring, Prices and Costs in the North Star Borough, Alaska (College: University of Alaska, 1965).

88 (4) Because of the physical proximity of the Alaska Railroad spur area to downtown Fairbanks, industrial warehousing, including log- istical facilities for coal and bulk fuels, has been centered in the railroad area. Sea-Land and Consolidated Freightways are exceptions as they are not significantly dependent upon rail connections. These two firms represent the first stage of an increasing trend toward geo-

of local industries

(5) Many retailing and wholesaling businesses which have entered the market since 1955 are located outside the city center. Examples include Market Basket and Foodland in the grocery industry and Tip-Top 4 Chevrolet in auto sales and maintenance. Many of the less profitable retail stores formerly occupying high priority lands in the urban center have relocated or gone out of business.

(6) As evidenced by fewer vacant lots, the long-term building density pattern clearly indicates an increasing density of households in high income neighborhoods. Continued dilapidation of housing in lower income neighborhoods has required urban renewal efforts.

(7) Recent surveys confirm the incidence of pockets of poverty within the city. The low income housing survey of the Alaska State

Housing Authority in 1966 reconfirms data available from the Bureau of 5 Census for 1960. Both indicated that low income families and deteriorated

4 This trend is continuing. Cf. S. S. Haney, Food Pricing and Merchandising Practices in the North Star Borough, Alaska in 1965, (College: unpublished M.S. Thesis, University of Alaska, 1966), and G. J. Burgett, Analysis of Food Retailing in the Fairbanks North Star Borough with Particular Emphasis Upon Pricing and Promotion 1960-1966, (College: unpublished M.B.A. Thesis, University of Alaska, 1967).

5 Fairbanks Housing by City Blocks, 1960 Census of Housing.

89 housing conditions were associated particularly with older neighborhoods near the downtown area. These conditions were spreading into other residential portions of Fairbanks. These same relationships were substantiated through the block statistics of the Census data, which cross-classifies income, racial and housing characteristics by city block. The 1966-1967 surveys by the Alaska Division of Lands and the

Communi Action addi ionally th i (See

Chapter III.)

Geographic Density Patterns

The Fairbanks central business district in 1960 contained a sig­ nificant number of buildings which needed major repairs. Since that survey, substantial clearing efforts and urban renewal-like ventures throughout the area were undertaken. As a result, some 20 percent of the business district was improved. (See Figures 8 and 9.)

Residential housing throughout the Fairbanks area was rated as substandard by several corresponding surveys. Except for the immediate downtown areas, residence deterioration remained substantially unchanged through 1966.

The density of population in Fairbanks has changed in the last fifteen years. As shown in Figure 12 (Density of Population, 1950) the population was concentrated in the downtown urban area. At that time many subdivisions, as they are shown in Figure 13, did not exist. Home ownership was not widespread among families in Interior Alaska. Most of the developed subdivisions, such as those shown in Figure 13, grew up in

90 the period since 1950. Overall, these home building activities con- stituted a major addition to the community's stock of wealth.

New urban marketing centers were clustered about the Gaffney Road and Cushman Street intersection and southward. Smaller centers were established across the Chena River, and businesses along College Road have prospered. In the last several years, commercial and apartment vacCJncv rCJtes in the dm·mtown core areCJ have risen mCJrkedlv, and land values have not improved. Supporting parking areas for the business district have been relatively scarce. On most major streets and avenues in Fairbanks,

there is little consistency in the types of buildings which are found

adjacent one to another. A definite commercial district in a large

central city does not usually contain intermixed and unrelated businesses

to this degree. Property and sales taxes and speculation in real estate have not encouraged maximum economic twe of downtown area land.

The slow expansion of utility services has limited the geographic 6 expansion of commercial and residential building. In Interior Alaska,

the water and sewer service extension question is aggravated in the areas

annexed because residents have already invested in their own well and

cesspool-septic tank. Extension of water and sewer service into sparsely

populated residential areas is inefficient and very costly. This condition 7 is aggravated by the local weather. Because the extension of utility

services has not preceeded residential building, certain urban development problems have resulted.

6 utility services other than the Municipal Utility System exist. The dominant one is Golden Valley Electric Aasociation, an electric co­ operative. Of lesser importance are College Utilities in the College­ University Park area, and selected central water and sewage systems, installed by builders, e.g., Ballaine Lake Subdivision.

7 See Wolff and Haring, Natural Resource Base of the Fairbanks North Star Borou&h (College: University of Alaska, 1967).

91 (1) The immediate urbanizing area of the Borough does not possess all major utility services. Therefore, construction of many new residences requires the installation of wells and cesspools or septic tanks.

(2) Jurisdictional disputes among governmental agencies have arisen over the question of how far and where utility services should be extended. Related questions are:

1 . (a) What es should e .~lC

utility services to the already developed suburban

areas?

(b) Considering the excess capacity of City of Fairbanks

water reservoirs, what is the appropriate public policy

concerning the wholesaling of water at city limit lines,

as opposed to extending city limits?

(c) What are the corresponding public health responsibilities

of the state, the Borough, and the city?

Growth Alternatives and Potential

The anticipated increases in employment and income, discussed in previous chapters, are insufficient to encourage steady in-migration of adult persons and households. A slow growth rate is expected for the following reasons

(1) Conditions of demand for output from the Borough's industries are insufficient.

(2) Existing firms are too small, or they produce products which cannot be exported.

92 (3) The resident labor force is comprised of individuals of whom a large number are not eligible for vacant jobs or are unwilling to work in the occupations required.

(4) The physical environment of the Interior may be an absolute barrier to any continued long-term urban and employment growth.

The following projections are appropriate.

The anticipated pattern of commercial and residential building for

the next five to ten years depends significantly upon certain public and private decisions which control the supply of buildable land. Much of

the Borough's urbanizing area is not taxable. This is especially the

case where title is held by governmental agencies, including the 8 University of Alaska. For practical purposes, these areas are withdrawn and not available to private industry and commerce. Exceptions arise --

University lands are sold and leased, as are those of some federal agencies.

The state land selection program within the confines of the Borough does not directly affect urban development, but a transfer of state-acquired land to the Borough is potentially very important. The outcome of land

selection constitutes an uncertainty in forecasting, especially when the

Native land claims which have been filed on most of the Fairbanks area 9 are considered.

8 Donations in lieu of taxes are paid by governmental agencies in particular instances.

9 see unpublished map prepared by the Alaska Division of Lands, Anchorage, "Alaska Land Selections and Native Claims as of February 7, 1967,"

93 The projected employment and popula~ion growth, along with likely industrial expansion specified in previous chapters, will occur at a regular and fairly predictable pace. The locations of public lands in the Borough are shown in Figures 10 and 11. Public land and reserves now withdrawn from private use very likely will not be transferred to and built upon by private industry in the next three years. The local demand f o and s ec e the Alaska 67 Centennial complex, is relatively large, and public land holdings for this purpose probably will increase. A significant expansion of tourist and recreational facilities by 1975 is forecasted.

The following conclusions are drawn regarding the physical capacity of the urban area and its potential growth --

(1) The density of businesses and residences will remain sparse in comparison to other United States urban areas.

(2) Although parking space may be in short supply in certain areas, commercial land and complementary services will be generally available at a variety of locations without undue congestion or consumer travel time.

(3) The slow building rate will affect the existing land use patterns only in very minor ways.

(4) The physical capacity and therefore the growth potential of

the area, even considering the wide ownership of land by public agencies, are well in excess of anticipated private needs for the period to 1970.

(5) Seasonal utilization of commercial facilities will continue.

At the peak summer season, many of the retail establishments will operate

94 at abnormally high levels of activity. In the winter they will encounter correspondingly large amounts of idle capacity. The seasonal use of business facilities, together with high mid-winter vacancies in residential and apartment rental businesses, will continue to generate inflationary pressures.

Taxation

Property taxes, a major source of public school system support, are real estate costs which are traditionally borne by homeowners or passed on to rentors and other consumers. Preliminary investigation into the matter of real estate taxation revealed a lack of uniform and current appraisals, especially among residences widely separated from the city center. Many homes which were partially built or under construction as long as five years ago have not since been effectively reappraised. The overall tax situation might be improved by the extension of the Borough governmental powers, or by a more complete use of powers already available. Personal property taxes, currently not leveyed, could represent a major source of revenue in lieu of the alternatives of higher property appraisal levels or an increase in the mill levy.

New business and industry might be attracted to Fairbanks by indirect means. Industrial development parks with lease prices which are favorable, as well as the outright public construction of industrial facilities, have been used successfully in other regions. Industrial parks could be financed from municipal bond proceeds and would represent a tax-shelter subsidy to new industry located here. This tactic is a very real governmental stragety toward expanding the community's economic base. In the last

95 several years, the sale of municipal bonds (which are tax exempt) for developments which eventually entice industry into a particular locality has become increasingly subject to federal review and scrutiny.

The sales tax situation in the Fairbanks area has been discussed at 10 length in several recent reports. These revenues represent payments by consumers of 3 and 5 percent of the value of each retail transaction 11 to the Borough and , respect An ability to generate sales is especially desirable because every million dollars of sales provides at least $30 thousand of direct revenues to local government. If the Fairbanks area is able to recapture markets lost through mail order purchasing and by Fairbanksans shopping widely in

Anchorage and Seattle, and if a general sales expansion is derived from recreation and tourism, this portion of the tax base will become a most important source of governmental revenues. The price competition between

the Anchorage business complex and Fairbanks for Western and Northern

Alaskan markets is becoming more pronounced. However, the market should

expand gradually.

Implications for Planning

The local economic base and its geographic expansion could follow several different kinds of growth patterns. For the most part, these patterns will be controlled by employment growth, income levels and migration. For

10 see Peat, Marwick and Mitchell, "Review of the Revenue Structure of the North Star Borough, Alaska," (Fairbanks: March, 1965); and R. C. Haring, loc. cit.

11 city of Fairbanks, "Sales and Service Tax Ordinance Rules and Regulations," (Fairbanks: Mimeographed, Chapter 5, Code of Ordinances, Article II, March, 1961). example, if sales and employment expand at approximately 40 and 10 percent respectively, one would expect significant secondary consumption and building to result. Conversely, a reduction in residential constructio1 and government contracting, especially if coupled with an exodus of military personnel, almost certainly would cause a major downturn in the local economy. (See Chapter VII.) In such a case, widespread un-

no in land use patterns would result.

The contents of this study and especially the conclusions given below are relevant to urban planning in the Fairbanks North Star Borough.

Business, industrial and public administrators in local government units could utilize this information in programming their economic development 12 efforts. In this regard, several conclusions are drawn concerning these planning activities

(1) The collection and compilation of business data and the forecasting of local business conditions should be improved and accomplished on a regular basis. While forecasts will not be absolutely accurate, their regular and wide use tends to improve the quality of publ ic. p 1 ann1ng. . 13 Benefit-cost analysis of local projects should be encouraged. The use of this tool is appropriate in this Interior urban area, especially if applied to public investment decisions.

(2) The Fairbanks community is significantly dependent upon a federal expenditures base, which has been relatively stable since World

12 see Committee for Economic Development, Community Economic Development Efforts, (New York: C.E.D. Supplementary Paper 18, December, 1964).

13 cf. Charles Tiebout, Community Economic Base Study, (New York: Committee for Economic Development; 1962).

97 War II. Non-military expenditures and income represent an apparently

sound but very restricted economic base. Diversification of the community

into industries whose markets are non-governmental is especially

desirable. Future development should seek a more balanced economic

structure with a greater inherent potential for continuing growth.

(3) A realistic approach should be taken in designing facilities

and programs for the education and of s

should be provided with marketable skills by giving them training which

will encourage their promotion into higher income groups elsewhere should

they out-migrate to other regions.

(4) The anticipated growth within the Borough to 1975 and 1985

will not warrant increasing prices, such as speculative land values or

increased housing costs. Businesses almost certainly will become more

competitive, and consequently prices can be expected to remain quite

stable or to decline, Costs of factors of production in Fairbanks need

to be held stable if an expansion in the economic base is to occur.

This is especially necessary in business overhead costs and wages.

Therefore, increased operating costs should be completely matched by

gains in labor productivity.

(5) In certain instances the Fairbanks economic community suffers

from adverse price-cost relations. Because of high local labor costs and

improved logistical support by outside firms selling in the Borough,

business opportunities for local producers are becoming fewer and more

restricted. For example, opportunities for selling agricultural products

have worsened in the past two years. An excess of facilities in a

particular area, such as Anchorage, is likely to encourage "dumping" of

products into the Fairbanks market. In some cases, permanent entry will

98 almost certainly be the result, e.g., bakery goods. In the main, high wages and overhead costs of operation almost certainly preclude attracting many kinds of new industries which prospered in other United States regions

at a similar stage of regional development.

(6) The pace of development will require only gradual public and

private investment. With the observed conditions, federal spending is

expected to remain at the same level in the Fairbanks

decade. Federal "pump priming" spending normally generates a relatively

dampened impact upon a local economy. A more diversified economic base

is preferable to large federal spending projects in the local area.

(7) Businesses and industries that do prosper in the Borough are

not expected to earn high or "excessive" profits during the coming decade.

Active price and service competition will control profit margins on an

unprecedented scale.

(8) The quality of marketing services probably will improve, and

consumer product lines will expand.

(9) If prices remain stable, as is expected, real income benefits

will accrue to Fairbanks residents in comparison to major metropolitan

areas, such as Seattle, where inflation is proceeding without inter­

ruption.

In the planning of economic development, individuals normally

demonstrate a bias toward optimism. In reviewing economic base studies on

the Fairbanks environment, over-estimation of business expansion has been

the general rule. Many mistakes have been made by business, industry and

public agencies during the last fifteen years. Over-investment of public

and private resources is costly when compared to the alternative programs

which might have been implemented. In this regard, more reliable information

99 TABLE 31

ANNUAL EXPENDITURES ON BUILDINGS,

UNIVERSITY OF ALASKA (COLLEGE), 1957-1966 (in thousands of dollars)

Improvements to t'< Year New Buildings Existing Facilities Total 1957-1958 1,227 150 1,377 1958-1959 1,978 818 2,796 1959-1960 143 69 212 1960-1961 2,936 12 2,948 1961-1962 2,181 324 2,505 1962-1963 48 178 226 1963-1964 7,985 315 8,300 1964-1965 4,967 1,243 6,210 1965-1966 177 170 347

TOTAL 21,642 3,279 24,921

PERCENT (84.9) (15.1) (100.0)

*Straight line least squares trend: T 2,769 + 309.6 (in thousands of dollars)

SOURCE: Comptroller's Office, University of Alaska.

100 on the Fairbanks economic base should be used widely by business and industrial leaders to avoid the kinds of errors which have arisen in recent years.

101 VII

LOGISTICS AND PHYSICAL DISTRIBUTION

A relatively large proportion of business enterprise in the Borough is concerned with marketing and logistics activities identified in the preceding chapters. Changes in marketing institutions within the

Borough have been very dramatic, New national stores, such as S in 1961 and more recently the J. C. Penney Company in 1967, have entered

the retail marketplace. Entry of new larger stores has been associated with a decline in number of smaller stores. The Fairbanks marketplace has witnessed the regular exit of many older line businesses since 1957.

In addition, new modes and services in transportation, such as that provided by containerized Sea-Land traffic, have affected the area in

terms of the delivered costs of acquiring goods. In this chapter, many

of these marketplace conditions are examined.

The purposes of this chapter are --

(1) To depict the flow of goods and services within the Borough

in terms of value of transactions.

(2) To identify the transporta~ion network and forecast the types

of changes which will occur.

(3) To survey wholesaling and retailing facilities in terms of

their sufficiency in technology and extent.

(4) To indicate the type of businesses which will be required to

support economic growth.

(5) To indicate the spatial requirements of these changes.

102 Flow of Goods and Services

The nature of flows of commodities brought into the Borough and those produced locally are of particular concern because of their role in the formation of retail prices. The price situation in Fairbanks has been reported over a relatively long period and analyzed in a 1 variety. o f stu d'ies. For summary purposes, these consumer price move- ments are depicted in Figures 14 to 20.

Compared to other U. S. urban areas, overall Fairbanks retail prices showed little or limited inflation since 1957 and have remained relatively stable since 1960. Several special consumer cost conditions are apparent

(1) Seattle consumer prices have risen annually while Fairbanks price indexes have declined in terms of the Seattle price base. Thus, by implication, there has been relative price stabiliy. (See Figures

17-18.)

(2) Individual family expenditures in certain product areas change regularly. Some components of the price index increased while others, as housing costs shown in Figure 16, remained stable. Certain

local industries have contributed toward higher prices while others have not.

(3) Since 1960, major improvements in retail merchandising, product lines and in marketing services have occurred. For the most part, these benefits are not reflected in the consumer prices indexes.

1 see, for example, R. C. Haring, Prices and Costs in the North Star Borough, Alaska, (College: Institute of Business, Economic and Government Research, University of Alaska, 1965).

103 FIGURE 14

COMPARISON OF AN OVERALL COST OF LIVING INDEX FOR SELECTED ALASKAN CITIES AND SEATTLE 1957-1966 (SEATTLE = 100)

150 Fairbanks

145

140

Anchorage 135 f-' 0 ~ 130

125 ~~~~----~ ------~------~--~~~~~~~~~~~~~~-- 120 ..__-- Ketchikan ll5

llO

105

100 1957 1958 1959 1960 1961 1962 1963 1964 1965 1966 FIGURE 15

UNITED STATES ALL-CITY CONSUMER PRICE INDEX AVERAGE COMPARED WITH THE SEATTLE CONSUMER PRICE INDEX AVERAGE, 1960-1966 (1957-59 = 100) Seattle

United States All-city Average

114

I '/ 112 I 112 I lll I I I Housing I I I 110 I I All Items Food I I f-' / 0 llOl / I; \J1 / / 108 108- // / ./// / // // 106 / /"'// 106f.- / / / / ,...... //~ All Items / / 1041- 104 f / / ?/"'/~~ Food :Y / / Housing 1021- 102 / / / I lOOL 100

60 61 62 63 64 65 66 60 61 62 63 64 65 66 SOURCE: Bureau of Labor Statistics, The Consumer Price Index FIGURE 15 (continued)

122 I I I 120 Seattle Medical United States All-city Average ~ // 118 Medical ~~/ / 116 I I I I 114 L Transportation - / / I I / 1121- / I I / I-' Transportation ~ 0 / I 0\ / / 110 / I / / I / I / ;Y I / / / I / 108 //-~I / / /------/ // / // 106 / _.,,...,.. / / ersonal Care / // / Personal Care 104 /~- Apparel & Upkeep 102 Apparel & Upkeep

I I _J 60 61 62 63 64 65 66 60 61 62 63 64 65 66 114 SEASONAL INDEXES FOR HOUSING ~ COST COMPONENTS IN FAIRBANKS, 1962-1966 112 Household ...... ~ ,,,. ~ (May-October, 1960 = 100) Operation ...... ~ "" \ llO ------108 House------Furnishings & Operations 106

House Furnishings 104 I

102 ·------I-' 0 / "" //alid Fuels & Petroleum '--I 100 ~ -~- -~/ -_;~~/~/~~~~~~~~- 98 Rent

96

94 ---·--

92

90 Gas & Electricity 88 Oct 1962 April 1963 Oct 1963 April 1964 Oct 1964 April 1965 Oct 1965 April 1966 Oct 1966 SOURCE: United States Department of Labor, Bureau of Labor Statistics FIGURE 17 SEASONAL INDEXES FOR SELECTED FOOD COST COMPONENTS IN FAIRBANKS, 1962-1966

(May-October, 1960 = 100)

114

112 j---~------110 Pro

Food _,,..,.,,.,...... 108 S

I-' ~~ 0 106 00

104

102

100 Dairy Products ------98 & Vegetables

I _I 96 Oct 1962 April 1963 Oct 1963 April 1964 Oct 1964 April 1965 Oct 1965 April 1966 Oct 1966 SOURCE: United States Department of Labor Bureau of Labor Statistics FIGURE 18

SEASONAL INDEXES FOR COSTS OF TRANSPORTATION IN FAIRBANKS 1962-1966

(May-October, 1960 = 100)

114

1121 Public 110

108

f-' 106 0 '° Public 104t - Private ~ 7' 102 -

100 Private

98

Oct 1962 April 1963 Oct 1963 April 1964 Oct 1964 April 1965 Oct 1965 April 1966 Oct 1966

SOURCE: United States Department of Labor Bureau of Labor Statistics FIGURE 19

SEASONAL INDEXES FOR COSTS OF APPAREL IN FAIRBANKS 1962-1966 (May-October, 1960 100) 116. /

11

Footwear 1121

110

y---=- 108

I-' 106 ------.___ /Men & Boy's I-' /I 0 >. ~ -...... _ Apparel _ _// Women & Girl's Apparel 104 ~ ---~ All Apparel and Footwear______.,, 102 100 ~ 98 ..

I I I I I I f I I Oct 1962 April 1963 Oct 1963 April 1964 Oct 1964 April 1965 Oct 1965 April 1966 Oct 1966

SOURCE: United States Department of Labor Bureau of Labor Statistics FIGURE 20

SEASONAL INDEXES FOR COSTS OF OTHER SELECTED PRODUCTS IN FAIRBANKS, 1962-1966

(May-October, 1960 = 100)

114 Reading & Recreation

112

110

Medical Care

f-' f-' f-'

Personal Care Other Goods & Services

~

9

Oct 1962 April 1963 Oct 1963 April 1964 Oct 1964 April 1965 Oct 1965 April 1966 Oct 1966

SOURCE: United States Department of Labor Bureau of Labor Statistics (4) Although inflation since 1957 has not been a serious industrial development problem, the level of prices in Fairbanks is very high. The cost of living differential between Fairbanks and the continental United

States is still 30 to 40 percent of the gross salary for most families.

(5) The impact of higher consumer prices in Fairbanks falls unevenly upon households and discriminates heavily against households with average and large families Actu~l costs of li s persons and married couples are very similar to those in western metropolitan areas but are markedly higher for households comprised of four or more persons.

(6) Because of consumer cost considerations, and in view of the employment opportunities discussed in Chapter III, three related conditions are particularly critical. They are -- (a) In a relatively high proportion of families, two adults work full time. (b) Even considering (a) above, the amount of "discretionary income" is limited, 2 and personal saving is small for most income groups. (c) Migration from

Fairbanks to Anchorage and elsewhere results, and transfers of this type will continue in many occupational areas.

The overall value of goods and services sold in the Fairbanks

North Star Borough is difficult to pinpoint. However, the following table depicts the value of transactions for each major industry. For summary purposes, an analysis of the region's flow of goods and services reveals the following patterns --

2 Bureau of Labor Statistics, Consumer Expenditures and Income-Fairbanks, Alaska, (Washington: 1959).

112 (1) The single most important money flow is represented by disposable personal income of residents and military personnel (net wages and salaries). Its stability is, as shown in Chapter III, dependent largely upon governmental employment.

(2) The personal consumption expenditures pattern of households to a considerable degree bypasses local businesses except for rents and

enance purchases, In addition governmental and private construction spending stimulates the local economy very little due to

"leakages" to outside contractors and the high degree of value added to 3 products prior to arriving in Alaska.

(3) Within the business sector, the value of local wholesaler transactions has declined as retailers purchase directly from the

Seattle-Portland trade complex. The "value added" by trade in Fairbanks is estimated at a very minimal figure, a matter brought out fully in

Chapter V.

Logistics and Transportation

Interior Alaska is a vast and diverse area and has been characterized by complex transportation demands since the 1950 1 s. The Fairbanks North

Star Borough, with its central core population, requires unique logistics, especially in the context of Alaskan seasonal fluctuations in economic activity. It is doubtful that any other area of comparable population concentration in the world is endowed with the wide availability of

3 cf. G. E. Huddelson, Survey of Military Personnel ... , (College: unpublished M.S. Thesis, University of Alaska, 1966), and E. J. Mayo, Mail Order Buying Habits ... , (College: unpublished M.S. Thesis, University of Alaska, 1966),

113 TABLE 32

GROSS RECEIPTS AS REPORTED IN BUSINESS LICENSE TAX RETURNS, CITY OF FAIRBANKS AND NORTH STAR BOROUGH, 1962-1965

1962 1963 1964 1965 Construction $27,964,061 $27,115,158 $27,677,169 $32,386, 728 Manufacturing 785' 119 761,325 956,786 681,482 Professional 3' 774, 046 5,459,555 4,043,431 3,667,983 Transp., Comm. and Utilities 11, 965, 709 12,150,330 14,442,099 12,767,672 Wholesale 8,454,209 9,289,144 9,648,567 13,248,524 Retail 38,674,514 40,940,364 37,593,412 46,010,663 Finan~e and Real Estate 12,036,782 8,634,211 7,585,641 8,447,005 Service 3,828,232 3,886,933 3,121,756 4,412,998 Agriculture 230,554 3,043 -0- ,550 Miscellaneous -0- -0- 23,664 -0-

TOTAL $107' 713' 226 $108,240,063 $105,092,525 $121,623,605

SOURCE: State Department of Revenue

transportation services which are readily available here. In outlying areas of relatively sparse population, however, transportation demands often fluctuate widely.

This section of the report is concerned with identification of the region's existing transportation systems. Various modes and services are outlined, including the Borough's in- and out-bound traffic network.

The Borough is the farthest north transportation center on the continent.

Daily flights connect with many surrounding areas, to Canada and to the contiguous United States. It is the northern terminus of the highway

114 system ~onnecting Alaska to the other states via Canada. It is also a northern terminus of the Alaska Railroad, which provides the Interior access to ocean carrier services from Canada. Limited river traffic also is routed from the Borough. These major categories are the framework of the Fairbanks North Star Borough's transportation system. Each is discussed separately in the following sections together with comments on petroleum distribut , warehous and t

By Water

A majority of consumer goods arrives in the Fairbanks North Star

Borough via water carriers and subsequent inland delivery. Water carriers from Puget Sound and British Columbia connecting ports utilize vanships

(converted conventional steamships) and rail-carrying conveyances. At 4 present, the Alaska Steamship Company and Sea-Land Freight Service, 5 Incorporated, operate vanships between Seattle and the railbelt ports of Anchorage and Seward, respectively. These vessels haul commodities such as plaster board, lumber, plywood, vehicles and some bulk commodities, e.g., special petroleum and milk products.

The largest share of commodities is shipped partly by ocean vessel to Alaska. Barges of the Canadian National Railway's Aqua-train system operate between Prince Rupert, British Columbia and Whittier, providing

Fairbanks with connections to Canadian National routes to the Midwest

4 Alaska Railroad, Seattle-Alaska Van Express Tariff, U. S. Department of the Interior, Freight Tariff No. 74.

5 sea-Land Service, Inc., Freight Tariff No. 116.

115 6 and East. The Alaska Trainship Corporation operates a trainship on a weekly schedule from Vancouver, British Columbia (Delta Terminals near 7 New Westminster), to Whittier. Puget Sound-Alaska Van Line's hydro-train operates the world's largest rail car barges from Seattle to Whittier, with connections to Midwestern and Eastern points via four northern U. S. transcontinental railroads. Overall, this transport arrangement is

imi] to Alaska rail connecting- water logistic services to the Borough account for most deliveries of 8 general commodities and non-petroleum bulk products.

The only "true" water distribution system to and from the Borough is the operation of Inland Riverways, Inc. This historical vestige of river transportation in the Borough maintains regular services during the ice-free season from Fairbanks to points along the Tanana and Yukon 9 Rivers, with transfer connections to other water carriers in the Koyukuk,

Chandalar and Procupine Rivers. The company operates two modern tugs with dual-purpose barges to distribute general cargo and petroleum products at the various villages and government facilities along the rivers. The barges have a capability of hauling various petroleum products in separation tanks in the hull, and general cargo and barrelled petroleum products are carried on deck.

6 Alaska Railroad, Seattle-Alaska Car Barge Tariff, U. S. Department of the Interior, Freight Tariff, No. 65-A. 7 Alaska Railroad, Seattle-Alaska Trainship, U. S. Department of the Interior, Freight Tariff No. 70-A. 8 Alaska Railroad, Seattle-Alaska Hydro-Train Tariff, U. S. Department of the Interior, Freight Tariff No. 67. See also Maritime Administration Survey of the Ports of Alaska (Washington: U. S. Department of Commerce, March, 1965), and Alaska Trade Study: A Regulatory Staff Analysis (Washington: March, 1967). 9 Inland Riverways, Inc., Tariff 1-A.

116 Inland Riverways face competition from Yutana Barge Lines, which 10 operates in. simi . ·1 ar territory. f rom t h e rai·1 trans f er point . o f Nenana.

The rate and service competition from hauling petroleum products to the river points for military and federal agencies is especially difficult because of the unpredictable outcome of annual I.C.C. (Section 22) rate quotations. The bids are made annually to the various government

fied

By Rail

The Borough is unique as the only Interior Alaska 'terminus of a major operating railroad in the State. The federal government owned and operated Alaska Railroad contributed to the growth and development of the railbelt area. Its operations date back to 1923--the opening of 11 the route from Seward to Fairbanks. Conceived and built as a resource development factor, the Alaska Railroad actually has aided directly in the development of only two of the area's resources--coal and gold.

Birch lumber and logs from the Wasilla-Talkeetna area have been shipped, b ut in. l'imite . d quantities. . . 12 Inbound movement of general commodities and petroleum products by the railroad for consumption in Fairbanks has been an important factor from the early days of service. The railroad's monopoly-like position is constantly being challenged by competing transportation modes which now maintain a more significant role in supplying the market area.

10 Yutana Barge Lines, Tariff No. 3. - 11 Richard A. Cooley, Fairbanks Alaska ... , (Juneau: Alaska Development Board, 1954). 12 cf. Michael Massie, Marketing Hardwoods from Alaska's Susitna Valley (College: Institute of Social, Economic and Government Research, University of Alaska, 1966).

117 In addition to moving general commodities and petroleum from tidewater, a significant activity of the railroad is the transfer of coal from the producing fields at Healy and Suntrana. Buyers are the University of

Alaska, the Golden Valley Electric and Municipal Utilities System power plants in Fairbanks and the military installations at Fort Wainwright and Eielson Air Force Base. In spite of the relatively short distance involved, the volume of coal the has sub- stantial Tevenues for the railroad, i.e., about $66 per car of 20 tons 13 from Suntrana.

Freight hauled on the railroad from connecting water services at

Seward, Whittier and Anchorage consists of petroleum, bulk commodities,

(such as cement) and, particularly in the last five to eight years, 14 container or van cargoes. Freight train schedules to the Borough are usually tied to connecting vessel arrivals at the ports of entry. In the winter months, the freight trains usually operate when a full load is made up in the Anchorage area. Definite schedules are maintained for at least two trips per week northbound.

Tourism provides sufficient traffic for the passenger trains to operate daily on the summertime twelve hour run between Anchorage and

Fairbanks. With the exception of summer tourism, passenger traffic on

13 Alaska Railroad Freight Tariff 16-F. Cf. Frances Connor, An Economic Analysis of Alaska's Coal Industry, (College: unpublished M.S. Thesis, University of Alaska, 1965). Also R. C. Haring, Prices and Costs in the North Star Borough, Alaska, (College: Institute of Business, Economic and Government Research, University of Alaska, 1965).

14 charles Beasley and R. C. Haring, Alaskan Cement Markets and Opportunities for Regional Production, (College: Institute of Business, Economic and Government Research, University of Alaska, 1965).~

118 the railroad is comparatively non-existent since the advent of fast and frequent air service and improved highway and driving conditions through- out Alaska.

By Air

Development of air transportation facilities and services in the

Borough has been rapid in the last decade, and the Fairbanks International

ed the Alaska Division of Aviation, has shown a sub- stantial increase in operations. Daily services to Seattle are maintained by Pan American World Airways and Alaska Airlines, the latter recently acquiring additional Southeast Alaska routes. Wien Air Alaska services

Juneau from Fairbanks by way of Whitehorse, Yukon Territory, with connections to Seattle via Pacific.Northern Airlines. Northern Consolidated provides weekly services to Lake Minchumina and the Koskokwim communities of McGrath,

Aniak and Bethel, and direct daily connections to Anchorage. A recent surge of mergers among the airlines indicates the increased demand for coordinated air transportation throughout the State.

The airport services several international carriers such as Lufthansa,

Scandanavian Airlines System, Japan Airlines and KLM Royal Dutch Airlines 15 as an alternate refuel stop to Anchorage for Europe-Orient flights. Major charter operators of the area such as Interior Airways, Reeve Aleutian

Airways, and Skyway Vans are regular users of the airport. Many private air taxi and charter operators also utilize facilities at Fairbanks

International. The Borough also contains a general aviation facility,

Phillips Field. This airport, utilized by private air taxi and charter operators, is conveniently located between Fairbanks and College.

15 see Fairbanks International Airport Problem (Fairbanks: February, 1958).

119 TABLE 33

AIR TAXI AND CHARTER OPERATORS IN THE FAIRBANKS NORTH STAR BOROUGH, 1966

Fairbanks Air Service Tanana Air Taxi Flightways Interior Airways, Inc. Ft. Yukon Air Service Marvin Jones Charter Service Frontier Flying Service Merrie, Incorporated Glenn R. Gregory Tundra Copters, Inc.

SOURCE: Authors' survey.

Air cargo is increasingly important to most carriers and to the overall utilization of the Fairbanks International Airport. Many tons

of commodities are arriving daily via the scheduled and charter carriers

from the contiguous states and Alaskan points. The airport serves as a hub for marketing activities to surrounding bush areas, the North Slope of the Brooks Range and the Arctic communities of Kotzebue, Point Barrow

and Barter Island. Outbound tonnage to these communities is usually more

than double that of inbound cargo.

With the introduction of the Lockheed Hercules air cargo planes, purchased by Alaska Airlines, 50,000 pound individual loads have been

transported to a variety of points on the North Slope in support of oil

exploration and copper development activities. A forty foot trailer-van

of goods is easily moved from Seattle to Fairbanks via the traditional

120 .TABLE 34

FAIRBANKS INTERNATIONAL AIRPORT, SUMMARY PASSENGER AND FREIGHT TRAFFIC, 1953, 1962-1966 *

Annual Traffic Growth Rate Categories 1953 1962 1963 1964 1965 1966 1962-1966

Passengers

( Disembarking 32,743 60,541 62' 721+ 67,917 73 ,108 76,358 +4.2

(2) Embarking 30,430 61,589 65,923 6 8, 9 61 72 ,011 75,240 +3.3

(3) Through n.a. 11,864 9,139 15, 718 7, 774 3,136 -1. 9

Freight (short tons)

(4) In-Bound 951 3,633 4,082 5,369 5,229 5,641 +.5

(5) Out-Bound 207 8, 773 9, 964 10 ,096 9,460 11,183 +.4

* Calendar Year Figures

SOURCES: 1953 Data; Fairbanks, Alaska, A Survey of Progress, Alaska Development Board (Juneau, 1954), p. 44

1962-1965 Data; "The Fairbanks Economic Community," Alaska Review of Business and Economic Conditions, Institute of Social, Economic and Government Research (College, 1966).

1966 Data; Alaska State Department of Public Works.

vessel/rail routing, then transferred to the airport by truck and loaded aboard

the Hercules cargo aircraft for final delivery to the natural resource

development areas.

121 By Highway

By 1967, Alaska contained over 7,000 miles of primary, secondary, municipal, pioneer access forest and oil service roads. The Alaska highway network provides continually improved road communications between most urban centers, including the Borough.

The Richardson Highway, which connects the Glenn and Alaska Highways to the , is the 's access road. The S eese and

Elliott Highways head north from Fairbanks, but serve no significant population centers. For many years, highway trucking to Fairbanks was monopolized by Valdez. In the early 1959's, however, with the opening of the Seward Highway to Anchorage, the easier year-round access to

Fairbanks led to shifting a considerable amount of motor freight away from Valdez to Seward. Consequently, more and more trucking is directed from the railbelt to Fairbanks in competition with the railroad.

Fairbanks is provided with a variety of motor freight services, including standard freight vehicles, temperature controlled vans, petroleum carrying tank trucks, asphalt and cement carriers and automobile carriers.

The trucking industry in Alaska has grown to over three hundred carriers representing all aspects of the hauling industry. As the highways have been improved and extended, price competition (among more trucking concerns) has evolved. Fairbanks receives daily freight by truck from

Seattle and Anchorage, and regular freight from Seward and Valdez.

Frequent service is routed through the Canadian highway system to major

Midwest cities. Occasional motor vehicle cargo is routed to the Borough from Southeast Alaskan points via the Alaska Marine Highway and Haines.

122 TABLE 35

COMMON MOTOR CARRIERS SERVING THE FAIRBANKS NORTH STAR BOROUGH

INTERSTATE *

Alaska Division Consolidated Freightways Lynden Transfer Weaver Brothers (Washington State) Ar-Dees Alaska Truck Lines, Inc. (Midwest)

INTRA-STATE

General Service Carriers Specialized Carriers Alaska Terminals, Inc. Alaska Van and Storage Arctic Motor Freight Continental Van Lines Al Rank and Sons Fairbanks Fuel Supply B & M Transport Service Mitchell Truck & Tractor Service V. D. Barber & Sons Norg as Denali Transportation Corporation North American Van Lines Dieringer Trucking Service Sig Wold Storage & Transfer H & S Warehouse Association Sourdough Express Sourdough Freight. Lines Peninsula Fast Freight Persinger Transport Company Peter's Express Pioneer Alaska Express, Inc. Sea-Land Freight Service, Inc.

*In addition to Interstate Authority, these companies also have Intra-state rights.

SOURCE: Alaska Carriers Association 1) Participating Carrier--Scope of Operating Rights Tariff 2-C. 2) Motor and Inland Riverway Scope of Alaska Operating Authorities.

Five active interstate and more than twenty-one intra-state certified carriers are serving the area. Few, if any, urban areas with comparable populations are endowed with the variety and physical capacity of motor freight services, summarized in Table 36.

123 TABLE 36 PERCENTAGE DISTRIBUTION OF PRIVATE AND COMMERCIAL TRUCKS * BY BODY TYPE AND INDUSTRY USAGE OPERATING IN ALASKA, 1963 Agri- Per- For Contract Manufact- Wholesale and Total culture sonal Hire Construct. uring Retail Business Services All other uses Distribution by Industry Usage Pick-up 100.0 4.8 65.2 1.4 12.7 1.8 6.4 6.0 1. 7 Panel Walk-in 100.0 5.6 22.2 3.3 17.6 2.6 22.0 21. 4 5.3 Platform and Cattle Rack 100.0 12.5 22.0 11.0 21.0 4.6 12.8 7.1 9.0 Vans 100.0 2.5 5.1 50.9 0.8 5.7 29.2 2.5 3.3 Refrigerator 100.0 ------100.0 Dump 100.0 5.5 6.7 25.1 36.1 1. 6 7.9 8.9 8.2 Tank 100.0 0.8 -- 16.1 8.9 5.6 62.1 6.5 Other 100.0 3.4 -- -- 10.3 58.1 -- -- 28.2 All Types 100.0 5.5 48.7 6.1 14.7 2.9 11.3 7.4 3.4 Distribution by Body Ty~e Pick-up 67.4 58.5 90.2 15.2 58.3 41. 2 38.2 55.3 33.8 Panel Walk-in 8.0 8.1 3.6 4.3 9.6 7.2 15.4 23.1 12.5 Platform and Cattle Rack 11. 3 25.6 5.1 20.3 16.1 17.9 12.8 10.9 30.3 I-' N Vans 3.5 1.6 0.4 29.2 0.2 6.9 9.0 1. 2 3.4 -I" Refrigerator 0.1 ------1. 3 Dump 5.3 5.2 0.7 21. 6 13.0 3.0 3.7 6.4 12.9 Tank 3.6 0.5 -- 9.4 2.2 6.9 19.6 3.1 Other 0.8 0.5 -- -- 0.6 16.9 -- -- 7.1 All Types 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0

>'< State Private and Commerical Truck Registrations Total number on file...... 27,586 Miscellaneous types not classified by size...... 1,117 Types included in table ...... 26,409 Truck Inventory and Use Sample Number selected on sample ...... 1,687 Out-of-scope types and postmaster returns ...... 198 Unanswered questionnaires ...... 100 Net number on sample...... 1,389 Miscellaneous types not classified by size...... 118 Number on sample included in table...... 1, 271 SOURCE: Bureau of Census, 1963 Census of Transportation. Household goods operators represent an important segment of the motor carrier industry. Sig Wold, H & S Warehouse Association, Denali

Transportation Company, and Sourdough Express are local agents for

national firms, such as Allied Van Lines, Continental Van Lines, Mayflower

Transit, North American Van Lines and Smythe Overseas Van Lines. Alaska

Orient Van Lines and Alaska Van and Storage are firms domiciled in Alaska

the area, Seven passenger bus companies include

Fairbanks in their current schedules. The Alaskan firms of Alaskan

Coachways, Inc. (Anchorage) and Alaska Overland, Inc. (Fairbanks) operate

throughout the year on intra-state highway routes. Large tourist busses

of the Alaska Highway Tours, Canadian Coachways, Greyhound Lines of

Canada, Trailways Tours, and the Whitehorse and Yukon Route usually circuit

the Borough area during summer months.

For the most part, transportation of goods and passengers by motor

carrier in Alaska is under the reg 1il11t:i.on of the Anchorage-based Alaska

Transportation Commission. The Interstate Commerce Commission issues

certificates indicating routes served, tariffs to be charged, and various

aspects of safety which control the activities of these firms doing

business in Alaska and interstate. Members of the Alaska Carriers

Association in Anchorage serve as a tariff filing bureau and as a center

for information regarding compliance of members.

Petroleum Transport

Petroleum products initially are shipped to the distribution ports

of Seward, Whittier, Anchorage and Valdez via privately-owned conventional

tanker vessels. Stove oil, diesel and jet fuels are sold from the refinery

125 at Nikiski on the Kenai Peninsula and are moved by tanker to storage and distribution facilities at the Port of Anchorage. Subsequent transportation of the majority of these products is by Alaska Railroad tanker cars from the railbelt entry ports to the Borough. In some instances, Valdez also receives the products of the Nikiski refinery by tanker. Connecting shipment of petroleum products from Valdez via the Richardson Highway is provided sporatically tcmker ro p such as prums, arrive on van or platform conveyance along with other

"general" cargo. Non-bulk petroleum, such as greases, lubricating oils and canned gasoline, move to the Borough from Anchorage, Seward or

Whittier at rates approximately 25 percent higher than the bulk or tank car load costs. Since 1960, Anchorage has acquired an increasingly large share of this logistical support.

An eight-inch pipeline (680 miles long) from the tidewater receiving and storage point at Lutak Bay (Haines) to the Borough serves most 16 petro 1 eum nee d so f t h e ml. l'itary insta. 11 ations.' Attempts to route civilian petroleum products via the military pipeline have been un- successful.

Warehousing

The several local warehousing facilities tend to follow no pattern 17 o f centra 1ization. . f or mark eting . nee d s. An exception to this is the concentration of household goods warehouses in the Alaska Railroad industrial area. Along with the modern facility of the Fidelity Warehouse

16 Alaska's Transportation Systems (Juneau: Department of Economic Department, 1966). 17 vernon Kiely, Wholesale-Retail Functions and Warehouse Facilities in Fairbanks and Anchorage, Alaska (College: University of Alaska, 1959).

126 TABLE 37

SELECTED ALASKA RAILROAD PETROLEUM RATES TO FAIRBANKS AS OF 1966 (In Cents Per 100 Pounds)

Origin of Shipment

Type of Rate Anchorage Seward Whittier

Bulk Rate * 90 115 115

Standard Rate 118 128 128

*Tank car loads.

SOURCE: Alaska Railroad Petroleum Products Tariff, Freight Tariff 8-C.

Corporation, in the same general area, this constitutes a nucleus for

consumer goods wholesaling. Specialized warehousing occurs at the H. s.

Warehouse Corporation, Fidelity Warehouse Corporation, the University of

Alaska, Odom Company, K & L Distributors, West Coast Distributing Company,

Norther Commercial Company and Weaver Brothers.

The recent introduction of door-to-door containerization delivery

and pickup by certain major carriers has caused a decrease in warehousing businesses. Twenty-four and thirty-five foot container vans (easily

transportable and representing storage in the customer's yard), reduce

the need for large temperature controlled warehouses. The containerized

transportation concept competes cost-wise with warehouses because of

decreased handling costs. Also, these containers are the investment

and amortization concern of the shipping company, not of the consignee.

The impact will be more significant when the wide use of containers becomes

accepted by additional consignees. This trend will continue and reduce

the need for additional warehouse space as economic activity expands.

127 Rates

Freight rates applicable to Alaska trade are a significant factor in high "living costs." For example, the "market basket" and general cost-

of-living comparisons with Seattle traditionally have estimated Fairbanks

40 to 50 percent h1g. h er. 18 Table 38 shows a complete listing of freight

rates.

Historically, water transportation rates were structured as e

price item (cents per 100 pounds or cubic foot, whichever created the

highest revenue) with little or no consideration for quantity discounts.

With the introduction of container vans in the early 1950's, 30-40,000

pound single unit loads became a common standard. The advantages of

shipper-to-consumer traffic, such as door-to-door delivery and minimum

handling of unit lifts, resulted in additional incentive rates. These

incentives were reflected in "rate-breaks," or reduced rates, for higher weight utilization of a given van or combination of vans. For example,

a typical "break" decreases the rate from 358 (cents per 100 pounds) for

any quantity under 5,000 pounds, to 348 for 10,000 pounds, to 335 for

20,000 pounds and to 320 for 30,000 pounds.

Introduction of containerized shipments with incentive rates proved

to be a stabilizing factor for the Borough. "Through service" to Alaska by rail carriers from all Canadian and contiguous U. S. railpoints

commenced in 1962. Fully loaded railroad cars delivered to Alaska brought

about new volume rates for general commodities up to 100,000 pounds (and

an additional category -- "over 100,000 pounds"). Effective freight rates

18 Cf. R. C. Haring, loc. cit., and figures presented earlier in this chapter.

128 have been substantially reduced from the days prior to the wide use of container and rail cars. More competitive services and the use of volume rates have maintained or lowered the cost of transportation to the

Borough in almost every commodity group. This downward drift in costs has occurred in spite of substantial increases in certain operating costs of the commercial carriers. The two rate tables demonstrate existing rates to the Borough for selected items arriving via water/rail carriers.

Note that the latest corrected tariffs are subject to frequent revision, and that Anchorage rates have been entered in all examples for comparative purposes. Local buyers are confronted with service alternatives (shipper load and unload door-to-door versus distributive rate extras) fo~ all weight minimums available. These tables are "representative" of the costs of moving most goods to the Borough.

Fairbanks' logistical disadvantages are readily apparent in comparison with Anchorage. The rate spreads (or differences) between Anchorage and

Fairbanks are, in some instances, substantial percentages of the total transportation cost. In spite of the relatively short distance between these two Alaskan cities, the rate "spreads" are not uniform or consistent.

The Alaska Railroad, being the connecting carrier to the Alaska Steamship

Company, Alaska Trainship Corporation, Canadian National's Aqua-train,

Puget Sound Alaska Van Lines' Hydro-train and Sea-Land Services, is in a situation of "setting" the spreads or differences within rough limits imposed by tqe competitive modes. For example, beer and canned or preserved foodstuffs move to Fairbanks at uniform spreads of 50¢ and 59¢ per 100 pounds respectively from non-Puget Sound origins. Groceries,

129 TABLE 38

SELECTED 1967 COMMODITY TARIFFS TO FAIRBANKS AND ANCHORAGE FROM REPRESENTATIVE POINTS OF ORIGIN

RATES To To Delta To To Minimum Weights Tariff+ Commodity Origin Seattle Terminal, B.C. Fairbanks Anchorage in pounds Reference

Beer and Ale Los Angeles 310 260 80,000 PSFB i< (rates in cents 305 255 90,000 308-A per 100 lbs.) 300 250 100,000 298 248 110,000 " 297 247 120,000 " San Francisco 301 251 80,000 " 296 246 90,000 II 291 241 lOn,ooo " 289 239 110, 000 " 288 238 120,000 "

Portland 252 202 100,000 NPCF~ 251 201 120,000 49-B I-' w 0 Olympia 239.5 189.5 100,000 " 236.5 186.5 120,000 " Tacoma 243.5 193.5 80,000 " 238.5 188.5 90,000 " 233 183 100,000 " 218 168 excess over 100,00~' Foodstuffs, Fresno, Calif. 312 253 80,000 PSFB * Canned or Pre- 298 239 100,000 308-A served (rates in 289 230 120,000 " cents per 100 lbs.) 258 199 130, 000 " Merced, Calif. 304 245 80,000 " 290 231 100,000 " 281 222 120,000 " 250 191 130,000 " San Francisco 298 239 80,000 " 284 225 100,000 " 275 216 120,000 " i< 244 185 130,000 308-A TABLE 38 (continued)

RATES To To Delta To To Minimum Weights Tariff+ Commodity Origin Seattle Terminal, B.C. Fairbanks Anchorage in pounds Reference

Passenger vehicles Detroit 167 132 60,000 TCFB (rates in dollars 1-10 & 5-B per vehicle) San Francisco 65 50 60,000 PSFB 1< 308-A Seattle 219 174 no min. Sea-Land 116 247 211 no min. ARR 67 Delta Terminal, B.C. 197 158 no min. ARR 70-A - Structural Steel Pittsburgh 253 253 60,000 TCFB (rates in cent3 per 1-10 100 pounds) Chicago 203 203 60,000 TCFB I-' w 1-10 I-' San Francisco 312 271 80 PSFB * 302 261 100 308-A 259 120 fl Los Angeles 299 258 80 II 289 248 100 fl 245 120 II Seattle 219 178 80 Sea-Land 209 168 100 116 194 153 excess over 100,000 " 228 168 40 TCFB 184 143 80 5-B 179 138 100 II 177 136 120 II 175 134 150 " TABLE 38 (continued)

RATES To To Delta To To Minimum Weights Tariff+ Commodity Origin Seattle Terminal, B.C. Fairbanks Anchorage in pounds Reference

Structural Steel (rates in cents per 100 pounds) Walla Walla, Washington 28.5 40,000 NPCFB 25 75,000 2-R Seattle 277 168 38,000 ARR 74 404 320 40,000 ARR 67 & 70-A 277' 302 218' 243 60,000 Sea-Land 232 173 80,000 116 163 104 excess over 80,000 II w~ N *Rates apply via Seattle (Hydro-train) or Delta, B.C. (Alaska Trainship).

+Tariff References and Abbreviations: TCFB -- Transcontinental Freight Bureau NPCFB -- North Pacific Coast Freight Bureau PSFB -- Pacific South Coast Freight Bureau Sea-Land 116 -- Sea-Land Service, Inc. Freight Tariff No. 116 ARR 65-A -- Canada-Alaska (Aqua Train) Car Barge Tariff (Prince Rupert, B.C.) ARR 67 -- Seattle-Alaska (Hydro-train) Tariff (via Seattle) ARR 70-A -- Seattle-Alaska Trainship Tariff (via Delta Terminal, B.C.) ARR 74 -- Seattle-Alaska Van Express Tariff (Alaska Steamship Company)

SOURCE: Tariffs and Carriers' quotations cited. however, reflect spreads ranging from 84¢ on 30,000 pound minimum weight down to 59¢ on 80,000 pound minimum weight. Steel spreads range from 60¢ at 40,000 pounds down to 41¢ at 150,000 pounds minimum. As Borough demands for transportation increase, more carriers will be forced into competitive efficiencies.

Implications

The ion sys and facili handle annual growth and seasonally accelerated volumes of traffic in the near future. Changes in the transportation system depend principally on actions of regulatory bodies. In this respect, connecting carriers and many logistical functions are under regulatory control of federal and state agencies, such as the Federal Maritime Commission, the Interstate

Commerce Commission, the Civil Aeronautics Board and the Alaska Trans­ portation Commission.

"Reasonable" rates are maintained on carrier-owned facilities for hauling of goods to and within the Borough, and service probably will remain similar to that presently observed. Freight rates charged are a factor contributing to relatively high cost-of-living indexes observed in the Borough. For the most part, the Borough possesses advanced logistics distribution facilities. Fairbanks is located at the terminus of a major railroad and highway, has an up-to-date jet airport, and enjoys the technological advances in transportation not available in other interior area~ in Alaska.

Present rate levels charged for delivery of merchandise to the Borough are a matter of vital concern. It is fairly common knowledge that tariff

133 rates are intended to cover total operating expenses. They are structured to cover the round-trip voyage cost of the carrier. Interior Alaska's virtual "end of the line" situation has led to high tariffs. With no products to backhaul, higher costs are the result. The disparity of available space used northbound in comparison to southbound is approximately

85 to 90 percent. Moreover, long-haul carriers serving the Borough are

faced th a 90 to 95 tua Tf and when southbound space is used, the northbound tariffs will likely undergo downward price revisions. For the most part, carriers have not enjoyed dependable year-round southbound shipping and the present situation justifies no rate reductions.

In the next decade, more unit shipments will occur using combined transportation modes. Air cargo activities will undoubtedly undergo gains, even more than witnessed in the past 13 years. Cargo jet service

(including jumbo jets and the introduction of the SST) is likely to result in rates of approximately three cents per ton-mile or less. The Trans­ pacific Route Case, now being considered by the Civil Aeronautics Board, concerns stop-over rights and route privileges to Fairbanks. The outcome of this case would affect the tourism potential of the Borough and probably stimulate cargo traffic operations. As more international carriers take advantage of Fairbanks' strategic location, additional airport facilities

(including air cargo) will be required. A major factor to Fairbanks' success as an international and inter-regional air distribution center will be the availability of jet fuels at competitively low cost.

134 The extension of roads and railroads to oil and copper development regions, as well as to the Seward Peninsula and Nome, unquestionably will stimulate economic growth. State legislation could be initiated to build a winter haul road out of Fairbanks upon which specialized equipment over frozen winter trails would be used. The feasibility of these projects has yet to undergo serious study.

An immediate prospect is the completion of the new Anchorage-

Fairbanks Highway in the early 1970's. This project will reduce the total distance between the two major trade centers of the state by about 100 miles and travel time would be even more significantly reduced. Motor vehicle carriers anticipate an improved pricing situation upon completion of this new overland route. Present rates are based upon the existing highway's mileage and conditions. These tariffs will probably decline immediately. Active price and service competition with the Alaska Railroad is expected on nearly all commodities, except possibly the very heavy bulk items, such as cement.

Given the present trends in population and employment growth in the planning area, marketing and logistics institutions will continue to evolve slowly. Additional space requirements are small and apply largely to service industries, such as motel and tourism accommodations.

135 136 APPENDIX A

13_7 1965 TRANSACTIONS TABLE,

FAIRBANKS NORTH STAR BOROUGH, ALASKA (in persons as the unit of account)

Employment 1 2 3 4 5

152 Mining 1 0 0 0 0 0

1,229 Contract. Construction 2 0 29 0 0 75

224 Manufacturing 3 0 so 0 0 0

350 Transportation 4 0 80 10 0 5

687 Public Util. and Communication 5 0 15 5 5 5

1,664 Wholesale and Retail Trade 6 0 34 0 0 5

1,400 Services 7 0 20 5 10 30

386 Finance and Real Estate 8 5 65 20 20 5

3,613 Government - State and Local 9 0 0 0 0 0

2,810 Government - Fed. Non-Mil. 10 0 0 0 0 0

5,000 Government - Military Est. 11 0 0 0 0 0

20 Agriculture 12 0 0 0 0 0 17,535

SOURCE: Authors' computations

138 196S TRANSACTIONS TABLE,

FAIRBANKS NORTH STAR BOROUGH, ALASKA (in persons as the unit of account)

FINAL DEMAND Consumption Investment Export 6 7 8 9 10 11 12 I II III

47 s 0 0 0 () 0 0 0 100

2S 0 0 700 100 200 0 0 100 0

40 0 0 2S 2S 0 0 so 10 24

70 2 0 7S 7S 8 0 20 s 0 so 2S 2S 7S so 20 0 387 2S 0

10 10 s 200 so 100 0 800 so 400

0 10 lS 200 200 100 0 600 10 200 so s s 25 0 0 0 186 0 0

0 0 0 0 0 0 0 2,000 0 1,613

0 0 0 800 0 0 0 200 0 1,810

0 0 0 lSO 0 0 0 0 0 4,8SO

0 0 0 0 0 0 0 20 0 0 4,263 200 8,997

139 1-40 APPENDIX B

141 1965 DIRECT REQUIREMENTS TABLE, FAIRBANKS NORTH STAR BOROUGH, ALASKA (in persons as the unit of account)

Industries 1 2 3 4

Mining 1 0.0 0.0 o.o 0.0

Contract Construction 2 o.o 0.024 0.0 o.o

Manufacturing 3 o.o 0.041 0.0 o.o

Transportation 4 0.0 0.065 0.045 o.o

Public Util. and Connnunication 5 o.o o.a12 a.a22 a.a14

Wholesale and Retail Trade 6 o.a o.a28 o.a a.a

Services 7 0.0 a.a16 0.022 a.a29

Finance and Real Estate 8 0.033 0.053 0.089 0.057

Government - State and Local 9 0.0 0.0 o.o 0.0

Government - Fed. Non-Mil. 10 o.o 0.0 o.o 0.0

Government - Military Est. 11 o.o 0.0 0.0 0.0

Agriculture 12 0.0 0.0 o.o a.o

SOURCE: Computations from Appendix A.

142 1965 DIRECT REQUIREMENTS TABLE, FAIRBANKS NORTH STAR BOROUGH, ALASKA (in persons as the unit of account)

5 6 7 8 9 10 11 12

0.0 0.028 0.004 o.o 0.0 o.o 0.0 0.0

0.109 0.015 0.0 0.0 0.194 0.036 0.040 0.0

o.o 0.024 0.0 0.0 0.007 0.009 0.0 0.0

0.007 0.042 0.001 0.0 0.021 0.027 0.002 0.0

0.007 0.030 0.018 0.065 0.021 0.018 0.004 0.0

0.007 0.006 0.007 0.013 0.055 0.018 0.020 0.0

0.044 0.0 0.007 0.039 0.055 0.071 0.020 0.0

0.007 0.030 0.004 0.013 0.007 0.0 0.0 0.0

0.0 0.0 0.0 o.o o.o 0.0 0.0 o.o o.o 0.0 o.o o.o 0.221 0.0 0.0 0.0

0.0 0.0 0.0 0.0 0.042 0.0 o.o 0.0

0.0 0.0 0.0 0.0 0.0 0.0 0.0 o.o

143 1965 INDIRECT REQUIREMENTS TABLE,

FAIRBANKS NORTH STAR BOROUGH, ALASKA (in persons as the unit of account)

Industries 1 2 3 4

Mining 1 LO 0 ,0 0,0 ()' 0

Contract Construction 2 0.001 1.027 0.042 0.070

Manufacturing 3 0.0 0.003 1.0 0.045

Transportation 4 0.0 0.002 o.o 1.0

Public Util. and Communication 5 o.o 0.113 0.005 0.015

Wholesale and Retail Trade 6 0.028 0.019 0.025 0.045

Services 7 0.004 0.002 0.0 0.002

Finance and Real Estate 8 0.001 0.008 0.001 0.002

Government - State and Local 9 0.002 0.213 0.019 0.045

Government - Fed. Non-Mil. 10 0.001 0.039 0.011 0.031

Government - Military Est. 11 0.001 0.042 0.002 0.005

Agriculture 12 o.o 0.0 0.0 0.0

SOURCE: Computations from Appendix A.

144 1965 INDIRECT REQUiREMENTS TABLE,

FAIRBANKS NORTH STAR BOROUGH, ALASKA (in persons,as the unit of account)

5 6 7 8 9 10 11

0,002 0 0 0,001 0,033 0,0 0,0 0,0 0,0

0.020 0.030 0.023 o'. 064 0.0 0.0 0.0 0.0

0.030 0.002 0.029 0.094 0.0 0.0 o.o 0.0

0.019 0.001 0.032 0.058 0.0 0.0 0.0 0.0

1.011 0.011 0.047 0.015 0.0 o.o 0.0 0.0

0.034 1.007 0.005 0.038 0.0 o.o o.o 0.0

0.019 0.008 1.008 0.004 o.o 0. () o.o 0.0

0.068 0.014 0.043 1.015 o.o o.o 0.0 o.o

0.034 0.068 0.080 0.025 1.0 0.221 0.042 0.0

0.021 0.020 0.075 0.006 0.0 1.0 0.0 o.o

0.006 0.022 0.021 0.004 o.o 0.0 1. 0 o.o

0.0 0.0 0.0 0.0 o.o o.o o.o 1.0

145 APPENDIX C

Annotated Bibliography on Input/Output Analysis for Urban Planning in Non-Metropolitan Areas

P. J. Bourque and G. Hansen. An Inventory or Regional Input-Output Studies in the United States, Seattle: Graduate School of Business Administration, University of Washington, 1967. A listing of completed and in-progress studies.

M. Revised Edition. Cincinnati: , 1965. introduction Lo econometric models with limited emphasis upon I/O.

H. B. Chenery and P. G. Clark. Inter-industry Economics. New York: John Wiley, Inc., 1959. An excellent, technically and theoretically advanced statement about inter-industry studies.

E. A. Fiegenbaum (ed.). Computers and Thought. New 'for;<:: McGraw-Hill Book Company, 1963. An interesting and up-to-date treatise on the role of economic model-building in forecasting as well as other decision experiments.

B. F. Green. Digital Computers in Research. New York: McGraw-Hill Book Company, 1963. A sound introduction to computer programming of this type.

R. C. Haring (ed.). 1966 Papers of the Western Regional Science Association. College: University of Alaska. An alternative method of surveying the impact of a university upon a community is found in the Mischaikow article. Aspects of the Oregon I/O and Washington I/O studies are found there also in article form.

Werner Hirsch. Regional Accounts for Policy Decisions. Baltimore: Johns Hopkins University Press, 1966, Survey of Public Planning uses of regional account data.

J, Johnston. Econometric Methods. New York: McGraw-Hill Book Company, 1960. A survey of conventional models in which a chapter is concerned with matrix models. A fairly advanced mathematical treatment.

William H. Miernyk. Elements of Input-Output Analysis. New York: Random House, 1965. A thorough, inexpensive paperback treatise on I/O analysis, especially useful in explaining the mathematical framework and interpretation of results.

National Bureau of Economic Research. Regional Income. Princeton: Princeton University Press, 1957. A thoroughly documented report on theoretical and empirical issues in estimating regional economic activity.

William W. Peek. An Economic Model of Butte County, California. Chico, California: Chico State College, July, 1965. A regional impact study for a county area comprised of a 28 thousand persons annual employment, and includes analysis of a state college in the economic base.

146 M. R. Rosenthal. Numerical Methods in Computer Programming. Homewood, Illinois: Richard D. Irwin, Inc., 1966, Contains a thorough explanation of matrix methods and matrix inversion programs utilized in the present study.

Henri Theil et aliii. Operations Research and Quantitative Economics. New York: McGraw-Hill Book Company, 1965. A standard introduction to model-building, including I/O.

C. E. Tiebout. Community Economic Base Study. New York: Committee for Economic Development, 1962. A well-written and straightforward statement of the logic and usefulness of quantitative economic research in community p

J. Tinbergen and H. C. Bos. Mathematical Models of Economic Growth. New York: McGraw-Hill Book Company, 1962. An advanced exposition of growth models, particularly thorough with regard to various forms (e.g., lags, open and modified models) and treatment of coefficients of the type presented in the Borough model.

S. Valavanis. Econometrics: An Introduction to Maximum Likelihood Methods. New York: McGraw-Hill Book Company, 1959. A thorough treatment of problems in estimation, many of which are applicable to the Borough model.

147 BIBLIOGRAPHY

Government Documents

Federal

Alaska International Rail and Highway Commission. Transport Hearing - Fairbanks, Alaska. Washington: U. S. Department of Interior, 1959.

Brockett, Jean C. "Index of Living Costs for Alaskan Cities," Monthly Labor Review, March, 1962.

Bureau of Census. "Alaska Farms, Farm Characteristics and Farm Products," Census of Agriculture 1964 (preliminary report). Washington: U. S. Department of Commerce, March, 1966.

Census of Housing 1960. Washington: U. S. Department of Commerce. 1963.

"Fairbanks, Alaska - City Blocks," Census of Housing 1960, Washington: U. S. Department of Commerce, 1961.

"Finance of Municipalities and Township Governments," Census of Governments 1962. Was~ington: U. S. Department of Commerce, August, 1964.

"Governmental Organization," Census of Governments 1965. Washington: U. S. Department of Commerce, 1964.

"Retail Trade - Alaska, II Census of Business 1958. Washington: u. s. Department of Commerce, 1960.

"Retail Trade - Alaska, II Census of Business 1963. Washington: u. s. Department of Commerce, 1964.

"Rural Housing," Vol. 6 in Census of Housing 1960. Washington: U. S. Department of Commerce, 1963.

"State Finances: 1962," Compendium of State Government Finances in 1962. Washington: U. S. Department of Commerce, 1963.

Statistical Profiles of Alaska Rural Development Areas. Washington: U. S. Department of Commerce, July, 1962.

"Taxable Property Values," Census of Governments 1962. Washington: U. S. Department of Commerce, August, 1964.

"Wholesale Trade - Alaska," Census of Business 1958. Washington: u. s. Department of Commerce, 1960.

"Wholesale Trade - Alaska," Census of Business 1963. Washington: u. s. Department of Commerce, 1964.

148 "Wholesale Trade - Alaska and Hawaii," Census of Business 1954. Washington: U. S. Department of Census, 1957.

Bureau of Labor Statistics. Consumer Expenditures and Income. Washington: BLS Report Number 237-30, Fairbanks, 1959, and subsequent releases.

ES-219B Labor Market Report, July, 1963. Washington: U. S. Department of Labor, 1963.

Indexes of Consumer Prices and Living Costs for Anchorage, Alaska. Washington: SF BLS 3-48, April, 1963, and subsequent releases.

Indexes of Consumer Prices and Living Costs for Fairbanks, Alaska~ Washington: SF BLS 3-47, April, 1963, and subsequent releases.

Indexes of Consumer Prices and Living Costs for Juneau, Alaska. Washington: SF BLS 3-54, May, 1963, and subsequent releases.

Indexes of Consumer Prices and Living Costs for Ketchikan, Alaska. Washington: SF BLS 3-55, May, 1963, and subsequent releases.

Indexes of Consumer Prices and Living Costs for Anchorage, Fairbanks, Juneau and Ketchikan, Alaska, Autumn 1966. San Francisco: March 21, 1966.

The Conservation Foundation. A Policy Study of Outdoor Recreation Potential in Alaska. Washington: Outdoor Recreation Resource Review Commission, June, 1960.

Federal Power Commission. "Publicly Owned Systems," Statistics of Electrical Utilities in the United States, 1962. Washington: 1964.

Federal Maritime Commission. Alaska Trade Study. Washington: Bureau of Domestic Regulation, March, 1967.

Graham, Robert Jr. "A Supplement to the Survey of Current Business," Income in Alaska. Washington: Office of Business Economics, U. S. Department of Commerce, June, 1960.

Labovitz, I. M. Federal Revenues and Expenditures in the Several States - Averages for the Fiscal Years 1959-1961. Washington: Library of Congress Legislative Reference Service, September, 1962.

Mueller, Frederick. "Selected Services Alaska," Census of Business 1958. Washington: U. S. Department of Commerce, 1959.

National Park Service. Alaska Recreation Survey: A Recreation Program for Alaska. Washington: 2 Vols., 1955.

Office of Emergency Planning. Inpact of Earthquake of March 27, 1964 Upon the Economy of Alaska. Washington: Executive Office of the President, April 6, 1964.

149 Office of the Secretary of Defense. Department of Defense Prime Contract _A_w_a_r_d_s_i_·n __ A_r_e_a_s_o_f __ Su_b_s_t_a_n_t_i_a_l_U_1_1_e_m....._p_l_o~y'-m_e_n_t. Washington: U. S. Department of Defense, 1964.

O.R.R.R.C. Financing Public Recreation Facilities. Washington: Report No. 12, 1962.

United States Army Corps of Engineers. Waterborne Commerce of the United States, Part IV. San Francisco, California: United States Army Engineer District - San Francisco, annual.

United States Department of Commerce. Survey of Ports of Alaska. Washington: Maritime Administration, March, 1965.

United States Department of Interior. "Published Tariffs." Washington: for carriers, commodities and times indicated.

United States Department of Labor. "Wage Rates for Alaskan Industry, Area 2," Wage Determinations AC-25, 702. Washington: April 13, 1964.

United States Geological Survey. Mineral and Water Resources of Alaska. Washington: 1964.

United States Weather Bureau. Climate of Alaska. Washington: U. S. Department of Commerce, 1959.

State and Local

Alaska Architectural and Engineering Company. Engineering Report 1961-1965 Expansion Program - Telephone and Electric Systems. Fairbanks, Alaska: Municipal Utilities System, 1960.

Alaska Department of Commerce. Alaska Passenger Traffic Survey. Juneau, Alaska: 1961.

Alaska Division of Lands. Alaska Public Outdoor Recreation Plan. Juneau: 1965.

Alaska Resource Development Board. The Ward Index on Consumer Price in Seven Alaskan Cities. Juneau, Alaska: November, 1958.

City of Fairbanks. Budget Message and 1965 Proposed Budget. Fairbanks, Alaska: December, 1964.

"Sales and Service Tax Ordinance Rules and Regulations." Fairbanks, Alaska: Mimeographed, Chapter 5, Code of Ordinances, Article II, March, 1961.

The Fairbanks International Airport Problem. Fairbanks, Alaska: February, 1958.

150 City Planning Commission. The Economic Base of the Greater Anchorage Area. Anchorage, Alaska: Advisory Committee on Economic Studies, September, 1956.

The Economic Base of the Greater Anchorage Area with Projections to 1963 and 1980. Anchorage, Alaska: Supplement Number 1, June, 1958.

City Planning Office. A Neighborhood Analysis of Fairbanks, Alaska. Fairbanks: City of Fairbanks, 1961.

Cooley, Richard A. Fairbanks, Alaska, A Survey of Progress. Juneau, Alaska: Alaska Development Board, July, 1954.

Courtright, A.M. Game Harvest Report. Juneau: Alaska Department of Fish and Game, January, 1964.

Department of Economic Development and Planning. A Capital Improvement Program for the State of Alaska. Juneau, Alaska: February, 1963.

A Capital Improvement Plan for the State of Alaska 1963-1969. Juneau, Alaska: February, 1963.

Alaska Campers 1964. Juneau, Alaska: 1965.

Alaska Passenger Traffic Survey. Juneau, Alaska: 1961.

Alaska Passenger Traffic Survey, 1961. Juneau, Alaska: September, 1962.

Department of Economic Development. Alaska's Transportation Systems. Juneau: 1966.

Department of Highways. Annual Traffic Report. Juneau, Alaska: State of Alaska and Bureau of Public Roads and United States Department of Commerce, 1964.

Department of Natural Resources. Alaska Passenger Traffic Survey, 1958. Juneau, Alaska: August, 1959.

Division of Mines and Minerals. Report For the Year 1964. Juneau, Alaska: Department of Natural Resources, State of Alaska, December, 1964.

Division of Tourist and Economic Development. 1959 Consumer Price Index in Seven Alaskan Cities. Juneau, Alaska: Alaska Resource Development Board, November, 1959.

Employment Security Division. A Study of Unemployment Insurance for Alaska State Government Employees. Juneau, Alaska: Alaska Department of Labor, 1963.

Highway Planning Board. Greater Fairbanks Master Highway Plan. Fairbanks, Alaska: September, 1958.

Hinkson, Charles E. Traveler Profiles 1963-1964. Juneau, Alaska: Department of Economic Development and Planning, 1964.

151 Local Affairs Agency. Borough Manual: Planning, Zoning and Public.Services. Juneau, Alaska: Office of the Governor, 1963.

Municipal Utilities System of the City of Fairbanks. Annual Report. Fairbanks, Alaska: annual.

Peat, Marwick and Mitchell. "Review of the Revenue Structure of the North Star Borough, Alaska." Fairbanks, Alaska: North Star Borough Tax Study Committee, March, 1965.

Price Waterhouse and Company. "Wage and Salary Survey of Fairbanks, January, 1964." Fairbanks, Alaska: Mimeographed, February, 1964.

State Division of Industrial of Development. Industrial Opportunities in Alaska. Juneau, Alaska: Department of Economic Development and Planning, September, 1962.

State of Alaska. Budget Document 1964-1965. Juneau, Alaska: Submitted to the Second Session of the Third State Legislature, 1964.

University of Alaska. Long Range Development Plan. College, Alaska: Office of the Director of Physical Plant and Campus Planning, 1964.

Ure, Barbara. Report on Comprehensive Community Mental Planning, 1963-1964. Anchorage, Alaska: Alaska Department of Health and Welfare, July, 1965.

Foreign

Bourne, L. S. Yellowknife, N.W.T., A Study of Its Urban and Regional Economy. Ottawa, Canada: Department of Northern Affairs and National Resources, 1963.

Books and Reports

Beasley, Charles. The Market Potential for Alaskan Clay Products. College, Alaska:· Mineral Industry Research Laboratory, University of Alaska, 1965.

Beasley, Charles and Haring, Robert. Marketing Cement Products in Alaska and ~rtunities for Regional Production. College, Alaska: Institute of Business, Economic and Government Research, University of Alaska, 1965.

R. W. Beck and Associates. Annual Engineering Report Municipal Utilities System of the City of Fairbanks, Alaska, as of July 31. Seattle, Washington: annual.

Comprehensive Plan, Fairbanks, Alaska. Seattle, Washington: 1953.

Engineering Report 1954, Extension and Improvement Program Municipal Utilities System of the City of Fairbanks, Alaska. Seattle, Washington: February 1, 1954.

Feasibility Report Financing and Improvement Program Municipal Utilities System of the City of Fairbanks, Alaska. Seattle, Washington: annual.

152 ~~- Inventory and Valuation, Telephone, Water, and Steam Heat Properties of Municipal Utilities System of the City of Fairbanks, Alaska at December 31, 1955. Seattle, Washington: June 20, 1956.

Preliminary Feasibility Report Water System Extensions and Improve­ ments Municipal Utilities System of the City of Fairbanks, Alaska. Seattle, Washington: October, 1961.

Buckley, J. L. Wildlife in the Economy of Alaska. College, Alaska: Alaska Cooperative Wildlife Research Unit, University of Alaska, 1957.

Clark-Coleman & Associates. Central Business District Study for Fairbanks, Seattle, Washington: June, 1960~

Civic Center Study for Fairbanks, Alaska. Anchorage, Alaska: Alaska State Housing Authority, 1960.

Comprehensive Plan for Fairbanks, Alaska. Seattle, Washington: October, 1959.

Fairbanks, Alaska Planning Report. Seattle, Washington: 1959.

Fairbanks Industrial Development. Anchorage, Alaska: Alaska State Housing Authority, 1960.

Conunittee for Economic ·Development. Community Economic Development Efforts. New York: C.E.D. Supplementary Paper Number 18, December, 1964.

Co-Venture Engineers. Preliminary Evaluation of Air Terminal Facilities and Requirements at Fairbanks International Airport. Anchorage, Alaska: Division of Aviation, Department of Public Works, 1960.

Eckstein, Otto. Trends in Public Expenditures in the Next Decade. New York: Committee for Economic Development, 1959.

Golden Valley Electric Association, Inc. Annual Report. Fairbanks, Alaska: 1962-1965.

Haring, Robert C. Prices and Costs in the North Star Borough, Alaska. College, Alaska: Institute of Business, Economic and Government Research, University of Alaska, 1965.

Haring, Robert and Beasley, Charles. Market for Insulation in Alaska and Feasibility of Regional Manufacture. College, Alaska: Mineral Industry Research Laboratory, University of Alaska, 1965.

Haring, Robert and Massie, Michael. Survey of the Alaskan Forest Products Industry. College, Alaska: Institute of Social, Economic and Government Research, University of Alaska, 1966.

Isard, Walter and Gauschow, James. Awards of Prime Military Contracts by County, State, and Metropolitan Area of the United States, Fiscal Year 1960. Philadelphia, Pennsylvania: Department of Regional Science, University of Pennsylvania, 1961.

153 Isard, Walter and Karaska, Gerald J. Unclassified Defense and Space Contracts Awards by County, State, and Metropolitan Area, United States, Fiscal Year 1964. Philadelphia, Pennsylvania: Department of Regional Science, University of Pennsylvania, March, 1965. ·

J. Walter Thompson Company. The Alaskan Market. Seattle, Washington: October, 1958.

Kiely, Vernon. Wholesale-Retail Functions and Warehouse Facilities in Fairbanks and Anchorage, Alaska; the Development and Possibilities for Expansion. College, Alaska: University of Alaska, 1959.

Kiely, V. and Hilpert, John. Small Business Administration

Leigh Fisher Associates. Fairbanks International Airport. San Francisco, California: 1962.

Linck, Stevens and Thompson. Water Works Improvements for the City of Fairbanks, Alaska. Portland, Oregon: 1961.

Massie, Michael. Marketing Hardwoods from Alaska's Susitna Valley. College: Institute of Social, Economic and Government Research, University of Alaska, 1966.

Neft, David S. Statistical Analysis for Areal Distributions. Philadelphia, Pennsylvania: Regional Science Research Institute, University of Pennsylvania, 1966.

North Pacific Consultants. Economic Analysis of Fairbanks and Contiguous Area, Alaska. Fairbanks, Alaska: Golden Valley Electric Association, Inc., January, 1959.

Perloff, Harvey, et alii. Regions Resources and Economic Growth. Washington: Resources for the Future, Inc., 1960.

Rogers, George W. "Alaska's Native Population and Poverty." College, Alaska: Mimeographed, Institute of Business, Economic and Government Research, University of Alaska, 1965.

Shoemaker, James H. Tourism in Alaska 1965-1975. College, Alaska: Institute of Social, Economic and Government Research, University of Alaska,1965.

Tax Foundation, Inc. Facts and Figures on Government Finance. New York: Thirteenth Edition, 1964-1966.

Tiebout, Charles. Community Economic Base Study. New York: C.E.D. Supplementary Paper No. 16, 1962.

United States Savings and Loan League. Local Housing Research Techniques and Data. Chicago, Illinois: January, 1965.

Upper Midwest Research and Development Council. Developing and Financing Private Outdoor Recreation in the Upper Midwest. Minneapolis, Minnesota: October, 1966.

154 Warnty, William. Macrogeography and Income Fronts. Philadelphia: Regional Science Research Institute, University 9f Pennsylvania, 1965.

Weisbrod, Burton A. The Economics of Poverty. Englewood Cliffs, New Jersey: Prentice-Hall, Inc., 1965.

Western Real Estate Research Corporation. Marketability Survey: Central Downtown Area, Fairbanks, Alaska. Anchorage: Alaska State Housing Authority, 1959.

Wolff, Ernest and Haring, Robert. Natural Resource Base of the Fairbanks­ North Star Borough. College: Uni versi ty of Alaska, 1967.

Wonnacott, Ronald J. Manufacturing Costs and the Comparative Advantages of United States Regions. Minneapolis: University of Minnesota, April, 1963.

Periodicals

Clawson, Marion and Held, R. B. "Demand for Rural Resources in the Context of Long-Range National Needs," Journal of Farm Economics, December, 1963.

Haring, Robert C. "Marketing in the Economic Growth and Development of Alaska," in Charles Goodman (ed.), Economic Growth Competition and World Markets. Chicago, Illinois: American Market Association, 1965.

"Some Water Quality and Air Purity Conditions Which Affect Economic Growth in Subarctic Urban Areas," 1967 Papers of the Regional Science Association: Western Section. Bellingham: Western Washington State College, 196 7.

Institute of Business, Economic and Government Research. Alaska Review of Business and Economic Conditions. College: University of Alaska, July, 1965.

McCosh, R. I. "Recreation Site Selection," Administration, December, 1961.

Watt, Darrell. "Fairbanks Residents and Outdoor Recreation in Interior Alaska." College: A.A.A.S. Reprint, 1964.

Unpublished Materials

Browning, A. D. Survey of Financial Institutions and Practices in Consumer Financing in the Fairbanks-North Star Borough for 1966. College: unpublished M.B.A. thesis, University of Alaska, 1967.

Bureau of Census. "Alaska Enumeration District Data," Census of Population and Housing 1960. Washington: unpublished photocopy.

Burgett, G. J. Analysis of Food Retailing in the Fairbanks-North Star Borough with Particular Emphasis Upon Pricing and Promotion 1960-1966. College, Alaska: unpublished M.B.A. thesis, University of Alaska,--1967.

155 Connor, F. An Economic Analysis of Alaska's Coal Industry. College: unpublished M.S. thesis, University of Alaska, 1965.

Haney, S. S. Food Pricing and Merchandising Practices in the North Star Borough, Alaska in 1965. College: unpublished M.S. thesis, University of Alaska, 1966.

Huddelson, G. E. Survey of Military Personnel Buying Habits at Fort Wainwright, Alaska for the Fiscal Year 1965. College: unpublished M.S. thesis, University of Alaska, 1966.

Jackson, Barry W., Esq. "Transpacific Route Investigation-Testimony to be Submitted Fairbanks Parties at Honolulu, February, 1967. Fairbanks, Alaska: January 30, 1967.

Mayo, E. J. Mail Order Buying Habits in Fairbanks, Alaska, 1965. College: unpublished M.S. thesis, University of Alaska, 1966.

Minion, J. N. Personal Income Characteristics of the Four Major Cities in Alaska for the Year 1964. College: unpublished M.S. thesis, University of Alaska, 1966.

Readnour, J. Comparison of Governmental Agencies by Occupations and Wages in the North Star Borough, Alaska 1966-1967. College: unpublished M.B.A. thesis, University of Alaska, 1967.

156