SOUTHEAST CONFERENCE Southeast Alaska 2020 Economic Plan Southeast Conference’s Comprehensive Economic Development Strategy 2016-2020 May 2016 Prepared by Rain Coast Data Southeast Alaska Economic Plan Page 4 SOUTHEAST CONFERENCE Southeast Alaska 2020 Economic Plan Introduction Southeast Conference is a designated Economic SWOT Analysis to identify regional Strengths, Development District (EDD) through the US Weaknesses, Opportunities, and Threats Economic Development Administration (EDA). As page 15; the region’s EDD, Southeast Conference is Economic Resilience map detailing how Southeast responsible for developing a Comprehensive Alaska communities intend to respond to the Economic Development Strategy (CEDS) for looming State fiscal crisis page 16; Southeast Alaska designed to identify regional priorities for economic and community Strategic Direction Action Plan incorporating development. This plan follows the new guidelines tactics identified through planning process, other released by the US Economic Development plans, and stakeholder feedback to develop the Administration in February 2015. The CEDS is a priority strategies for the region pages 17-29; strategy-driven plan developed by a diverse Strategic Direction Action Plan Part II Priority workgroup of local representatives from private, Objective Descriptions and Evaluation public, and nonprofit sectors. The following sections Framework to identify and monitor performance form the basis for the Southeast Conference CEDS: measures associated with the plan pages 30 to 39; One page Strategic Plan Summary page 2; Economic Plan Steering Committee roster of Summary Background of economic conditions in names page 40; the region pages 3-14; Appendices page 41. The CEDS process began in March 2015 to ensure maximum input from the Southeast Conference membership. This process engaged community leaders, leveraged the involvement of the private sector, and developed a strategic blueprint for regional collaboration. More than 400 people representing small businesses, tribes, native organizations, municipalities, and nonprofits were involved in various elements of the planning process. The following timeline shows meetings that took place over the past year: Southeast Alaska Comprehensive Economic Development Strategy Meeting Schedule Month Transportation Energy Timber Maritime Seafood Tourism Other CEDS March 2015 ! ! ! ! ! ! ! August 2015 ! ! ! ! September 2015 ! ! ! ! ! ! ! October 2015 ! ! November 2015 ! January 2016 ! ! ! ! February 2016 ! ! ! March 2016 ! ! ! ! ! April 2016 ! Southeast Alaska 2020 Economic Plan Page 1 Southeast Alaska Strategic Plan Summary Promote strong economies, healthy communities, and a quality environment in Southeast Alaska. Transportation Visitor Industry Priority Minimize Impacts of Priority Market Southeast Alaska Budget Cuts to AMHS and to Attract More Visitors. Develop Sustainable Improve Access to Public Lands. Operational Model. Increase Flexibility in Terms of Road Development. Permit Use. Move Freight to and from Increase Yacht and Small Cruise Markets More Efficiently. Ship Visitations. Ensure the Stability of Regional Improve Communications Transportation Services Outside of AMHS. Infrastructure. Advocate for Funding to Maintain Existing Energy Recreational Infrastructure. Priority Work with Federal and State Government to Grow Cultural and Arts Tourism. Promote Regional Energy Projects. Priority Diesel Displacement. Timber Industry Support Community Efforts to Priority Provide an Adequate, Economic and Create Sustainable Power Dependable Supply of Timber from the Tongass Systems That Provide National Forest to Regional Timber Affordable/Renewable Operators. Energy. Stabilize the Regional Timber Complete Regional Hydrosite Industry. Evaluation for Southeast Work with USFS to Direct Federal Alaska. Contracts Toward Locally- Owned Businesses. Maritime Support Small Scale Manufacturing of Wood Maritime Industrial Support Products in Southeast Alaska. Priority Maritime Industrial Support Sector Talent Continue Old Growth Harvests Until Young Pipeline: Maritime Workforce Growth Supply is Adequate. Development Plan. Community-Based Workforce Development. Continue to Grow the Regional Update Young Growth Inventory. Maritime Sector. Increase Access to Capital for the Regional Maritime Other Objectives Industrial Support Sector. Housing: Support Housing Support Capital Investments in Development. Expanded Marine Industry Food Security: Increase Support Infrastructure. Production, Accessibility, and Harbor Improvements. Demand of Local Foods. Examine Arctic Exploration Opportunities That the Communications: Improved Region as a Whole Can Provide. Access to Telemedicine in Southeast Alaska. Seafood Industry Marketing: Market Southeast Alaska as Priority Mariculture Development. a Region. Priority Full Utilization and Solid Waste: Regional Solid Waste Disposal. Ocean Product Education: Partner with University & K-12 to Meet Development. Workforce Needs Increase Energy Efficiency Arts: Increase Recognition of Southeast Alaska’s and Reduce Energy Costs. Thriving Arts Economy. Regional Seafood Processing. Mining: Minerals & Mining Workforce Development. Seafood Markets. Research: Attract Science and Research Jobs to Sea Otter Utilization and Southeast Alaska. Sustainable Shellfish. Cultural Wellness: Support Activities and Maintain Stable Regulatory Regime. Infrastructure That Promote Cultural Wellness Seafood Workforce Development. Healthcare: Meet Regional Needs. Southeast Alaska 2020 Economic Plan Page 2 SOUTHEAST CONFERENCE Southeast Alaska Summary Background This summary tells two stories about the Over the last five years we added 2,600 people and 1,500 jobs to our economy. Total workforce regional economy: a positive tale of five- earnings increased by $275 million, with most of that coming from the private sector ($209 year trends, and a more sobering one- million). With the exception of government, nearly every sector flourished. New jobs and year analysis and future forecast. investments occurred in the areas of seafood, tourism, mining, construction, healthcare, maritime, and energy. Housing starts tripled. After watching so many indicators fall from the early 1990s to the late 2000s, we became Changes in Southeast accustomed to an economy of decline, and this recent rise was nothing short of exhilarating. In the past five years, we have broken records, reaching all-time highs in population, workers, and Alaska: 2010 to 2014 total workforce earnings. But most of this expansion occurred Regional Map at the start of this five-year REGIONAL POPULATION period, and data from the last year especially indicates a INCREASED BY 2,616 contraction. PEOPLE TO 74,280 (+4%) Between 2013 and 2014 there were few areas of growth, and many indicators trended slightly LABOR FORCE INCREASED downwards. Jobs fell by 300, in the areas of government, BY 1,500 JOBS TO construction, and health care. 45,694 JOBS (+3%) There were 34,000 fewer cruise and ferry visitors to the region. The value of seafood harvested in the region fell by $100 million. The price of gold fell by GOVERNMENT JOBS 10%. Early 2015 job reports DECREASED BY show more losses on the way. 260 JOBS (-2%) The most concerning signal is the long-term strength of our government, which accounts for more than a third of all JOB EARNINGS INCREASED workforce earnings in the region. The State projects a BY $275 MILLION TO $2.2 two-year deficit of $7.7 billion, BILLION (+14%) and that our savings will be gone in four years. Clearly something will need to happen to address this, and because we are so dependent on the role PASSENGER ARRIVALS that government plays in our VIA PLANE, FERRY & CRUISE economy, that something could SHIP INCREASED BY create a significant downward 138,400 (+8%) drag on our economy. Southeast Alaska 2020 Economic Plan Page 3 S OUTHEAST ALASKA R EGIONAL OVERVIEW THE REGION The Southeast Alaska Panhandle extends 500 miles along the coast from Metlakatla to Yakutat, encompassing approximately 33,500 square miles of land and water. The saltwater shoreline of Southeast Alaska is approximately 18,500 miles. 78% More than 1,000 islands make up 40 percent of the total land area. The region is home to 34 communities. The three largest communities— Juneau, Ketchikan, and Sitka—together are home to 75 percent of the regional population. Alaska Natives make up nearly a quarter (22%) of the region’s population. LAND OWNERSHIP Southeast Alaska’s land ownership is dominated by the federal government, which manages 94 percent of the land THE FEDERALLY-MANAGED base. Most of this (78%, 16.75 million acres) is the Tongass TONGASS MAKES UP NEARLY National Forest. The remaining federal lands are mostly in Glacier ship 4/5TH OF ALL SOUTHEAST Bay National Park. The State manages 2.5 percent of the total ALASKA land base (511,500 acres), including the Alaska Mental Health Trust Authority and University of Alaska lands. Boroughs and communities own 53,000 acres—a quarter of one percent of the entire regional land base. Alaska Native organizations, including village, urban, and regional corporations and the Annette Island Reservation own 3.4 percent (728,100 acres) of the land base. Other private land holdings account for 0.05 percent of the OTHER FEDERAL HOLDINGS MAKE remaining land base. The lack of privately-owned land and land 16% available for development is unique in Southeast Alaska and UP NEARLY ALL THE REST (MOSTLY GLACIER BAY) impedes the ability of the region to nurture the private sector. (See