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Aedcconnections WELCOME! TO OUR new INVestoRS: AEDC STAFF 4th Quarter, 2007 Bob Poe The Arts are Big Business Bill Popp Princess Tours in Anchorage President & CEO Scott Balice Strategies, LLC connections Arts & Economic Prosperity III, a national survey from promoters of the arts, Erin Ealum RenewinG INVestoRS: AEDC shows that nonprofit arts and culture are a thriving industry in Anchorage – one Business & Economic The Newsletter of AK Supply, Inc. that generates $45.16 million in annual economic activity. Development Director Anchorage Economic Alaska Interstate Construction Development Alaska InvestNet According to the survey, this spending–$27.91 million by nonprofit arts and Heather Gould Corporation culture organizations and an additional $17.25 million in event-related spending Communications Alaska National Insurance Co. Director by their audiences—supports 1,168 full-time equivalent jobs, generates $24.24 Alaska Railroad Corporation million in household income to local residents, and delivers $3.84 million in local Alaska Rubber and Supply, Inc. and state government revenue. Not included in the study was spending by individ- Hallie Bissett WHAT’S INSIDE Alaska Telecom, Inc. ual artists and the for-profit arts and culture sector – such as for-profit arts groups, Logistics & International Trade Alaska Considers Increased Oil Taxes Anchorage Council of Bldg artists, photographers, painters, sculptors or the multi-million dollar expansion of Director & Construction Trades Unions the Anchorage Museum of History and Art at the Rasmuson Center. page 1 New rate will be the highest in North America Carr-Gottstein Properties Kari Mahar Chugach Electric Association, Inc. Alaska Considers Platinum Investor Spotlight While the study focused solely on the economic impact of the nonprofit arts, the Investor Relations & Incrreased Oil Taxes Events Coordinator City Electric, Inc. social and community benefits cannot be overlooked. Organizations such as the The key to the future of oil development in Alaska is investment. Investment will enable Coffman Engineers, Inc. Alaska Center for the Performing Arts, Anchorage Museum of page 2 Alaska’s oilfields to keep producing revenue for the state, and create jobs for Alaskans for Cornerstone Construction Co., Inc. History and Art, and all of the various performance Rebecca Shortman decades to come. Without large sustained investment, oil production will go into a steep groups, galleries and individual artists also Executive Assistant CRW Engineering Group, LLC President’s Letter decline, a fact on which the industry, the regulators and economists all agree. enhance the quality Dorsey & Whitney LLP of life and help Economic Snapshot On October 18, the Alaska Legislature will convene in Juneau to consider changing and, F.R. Bell & Associates, Inc. attract new residents, Flowers International LLC quite likely, raising oil taxes. This will be an important decision that will impact the future business and a skilled page 3 for every Alaskan. Fred Meyer Stores, Inc. workforce to Anchorage. Greatland Laser, LLC MOUs Offer Chinese The governor has proposed a new oil tax that would replace the PPT (petroleum profits tax), Business Boost HDR Alaska, Inc. Anchorage is one of 156 approved by the Alaska Legislature in August 2006. Under the proposed tax, the state Holmes Weddle & Barcott PC communities and regions estimated the total government take would reach 68 percent, based on a $60 oil price. that participated in Arts & Immediate-Care, Inc. page 4 Economic Prosperity III, which International Union of Operating Alaska already has the highest government take in North America. The proposed changes Engineers, Local 302 documents the nonprofit arts Anchorage Museum On Target for 2010 Opening would further increase Alaska’s tax rate and make the state less attractive to investment just Jaguar Development Group and culture industry in 116 cities as more investment is needed. JL Properties, Inc. and countries, 35 multi-county regions and five states. Anchorage organizations filled out Ken Brady Construction Co. Inc. page 5 “I think we have to respect the governor’s right to ask the Legislature to re-address the existing surveys in the summer and fall of 2006. Merrill Lynch AEDC is a private nonprofit tax structure (PPT),” said BP President Doug Suttles. “What is important now is that we corporation (IRS code 501(c)(6)), Banking Innovations Help operating since 1987. It exists to have a good and thoughtful debate. This is going to be about Alaska’s future. It’s important Millenium Alaskan Hotel encourage growth and diversity in Foil Fraud Attempts Anchorage the Anchorage economy, promote that we encourage investment in this state and make sure the Alaska tax structure will do that.” a favorable business climate and Movers, Inc. improve the standard of living of Anchorage residents. Funding page 6 N C Machinery Co. sources for the corporation are As context, it is worth bearing in mind that the new PPT tax amounted to a significant tax municipal and state grants, con- increase just last year. The Department ofR evenue estimates that during the first nine months Norcoast Mechanical tracts, and private contributions. UAA Opens New For permission to reproduce any Science Center of the petroleum profits tax, the state collected $805 million more than it Northrim Bank part of this newsletter, please call (907) 258-3700. would have under the previous tax system (April 1 – December 31, 2006). Nye Frontier Toyota Lexus of Alaska page 7 This article sponsored by BP Pegasus Aircraft Maintenance, LLC BuyAlaska Unveils Perkins Coie New Website Porcaro Communications, Inc. Convention Center Potelcom Supply, Inc. Progress Premera Blue Cross Blue Shield of Alaska 900 West Fifth Avenue, Suite 300 Providence Alaska Anchorage, AK 99501 page 8 Medical Center (907) 258-3700 Prudential Jack White The Arts Are Big Business Vista Real Estate www.aedcweb.com RIM Architects Shell Oil Sheraton Anchorage Hotel Ted Stevens Anchorage International Airport Tesoro Alaska Petroleum Company The Wilson Agency, LLC URS Corporation WebWeavers 8 Technology Group 1 ECONOMIC SNAPSHOT BOARD OF DIRECTORS EX-OFFICIO MEMBERS 2nd Quarter Commercial AEDC Construction Permit Valuations LEGISLATORS $144,930,205 4.63 $110,398,474 $109,993,367 Letter from the President $11 Billion Target of Harry Crawford Representative, Alaska State Legislature Alaska’s economy continues to grow, with nearly 2000 new jobs created in Anchorage alone Buy Alaska’s New Website during the first half of this year. Solid employment numbers in Anchorage and Alaska for Fred Dyson 2005 2006 2007 The Buy Alaska program will revolutionize the process of promoting local businesses, products and Senator, 2007 show the largest workforce, largest number of people employed and one of the lowest Alaska State Legislature • Commercial construction valuations totaled services when it launches buyalaska.com, a completely new, state-of-the art website, on Alaska Day, unemployment rates in Anchorage and Alaskan history. And a number of projects in our $110.4 million for the 2nd quarter of 2007, a October 18, 2007. decrease of 24 percent from the 2nd quarter downtown core and beyond, some of which you will read about in this issue, will spark even of 2006 and an increase of 0.4 percent from Hollis French more economic development in our vibrant city. the 2nd quarter of 2005. Alaskans spend approximately $11 billion Outside each year (UAA ISER 2007), with an ever- Senator, increasing trend toward on-line shopping by consumers, businesses and government purchasers. The Alaska State Legislature new website, buyalaska.com, will enable any and all Alaska businesses to take advantage of this trend But growing pains are coming, and some would say they are already here. 2nd Quarter Residential Craig Johnson Construction Permit Valuations by making it easy for shoppers to find Alaska businesses on the web. According to UAA ISER, if Representative, Alaska State Legislature $103,411,340 Alaskans shift just 10% of Outside purchases back to Alaska, $1.1 billion revenue will be generated Local business leaders report increasing difficulties filling open jobs with talented and skilled $92,687,275 workers. With several large oil & gas and mining projects in various stages of development and over 4,000 Alaska jobs created. $53,754,285 across Alaska, as well as other development and growth in our broader economy, we are Alaska businesses can set up their free, lifetime, full-page, color listings facing a new dynamic that runs counter to our past experiences. Growing worker shortages by going to buyalaska.com and following the easy instructions. could have implications for our entire Alaskan economy in the next decade. 2005 2006 2007 MUNICIPALITY Buy Alaska’s goal is to have 10,000 Alaskan businesses listed on the website by the October 18 • Residential construction valuations totaled launch day. Mayor Mark Begich Alaska is also competing with the rest of America, and even internationally, to attract and $53.8 million for the 2nd quarter of 2007, a decrease of 48 percent from the 2nd quarter Municipality of Anchorage retain these highly sought after workers. Earlier this summer, at the Pacific NorthWest of 2006 and a drop of 42 percent below the same period in 2005. Economic Region (PNWER) conference in Anchorage, provincial government officials from Dan Coffey Alberta noted that they are projecting a 100,000+ worker shortfall in their province over Assembly Member, Anchorage’s Dena’ina Civic & Municipality of Anchorage the next 10 years and similar projections were shared by British Columbia and the states of 2nd Quarter Total Employment Washington, Idaho and others. 151,335 150,470 147,335 Convention Center Progressing Rapidly But the question should be “how,” not “if,” will we fill these jobs. APPOINTED BY THE BOARD With just a little under a year to go, the $107 stellation,” will cascade through the 100-foot- million, 215,000-square foot Dena’ina Civic & high lobby creating a visual anchor through In the following pages, you’ll read about the University of Alaska Anchorage’s growth, Chris Anderson Convention Center in Anchorage remains on the multi-level facility.
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