Ketchikan invests in its own economic development

Posted: Sunday, July 31, 2005

Ketchikan Daily News By Lew Williams

Ketchikan won the National Municipal League's All American City designation in 1957. It was for a decade of community activism that brought Alaska a year-round industry, the $54 million Ketchikan Pulp Co. mill, and for community improvements: expanding hydro power, utilities, schools, harbors and streets. Mayor Joe Goding complimented the people of Ketchikan for planning and for approving $12.9 million in bonds to pay for the improvements

Ketchikan could win another national award in 2007 for a decade of rebuilding its community after the timber industry collapsed when the pulp mill closed in 1997.

The Ketchikan City Council last week approved long-term tax and power incentives for the state-owned Ketchikan Shipyard. The borough assembly granted tax incentives earlier. That means that the state's Alaska Industrial Development and Export Authority will immediately make available $14 million for construction of a second ship lift, more than doubling the yard's capacity.

Also, Congressman Don Young has $50 million in a pending bill to complete the shipyard. That is $64 million to create a facility capable of employing up to 300 people in high-paying maritime jobs serving Alaska's maritime industry.

The agreement with the shipyard was the first of three steps Ketchikan must take to boost its economy to All American status.

The next step comes Aug. 16, when city of Ketchikan voters will be asked to approve $70 million in bonds (equivalent to $12.9 million 55 years ago?) for a fourth berth in the harbor, and for upgrading existing berths and upland areas to support the cruise industry.

Ketchikan officials sat down with representatives of the cruise industry to see what the industry needed, agreed upon a design and reached an agreement on how to pay for it. The city will sell the bonds, with voter approval, but the industry will pay them off. Local taxpayers benefit from increased sales tax revenue from additional visitors staying in port longer because of expanded facilities.

The third needed improvement is completion of the Swan Lake-Tyee Lake Intertie. Ketchikan needs the power for its expanding industries: the shipyard, the hospital, tourism and hopefully timber again with a veneer mill and Pacific Log and Lumber's Gravina sawmill and dry kiln. Gov. Frank Murkowski's administration is cooperating by making state timber available to supplement national forest timber, much of which is held up by litigation.

The goal of the Southeast Conference, an organization of all Southeast Alaska communities, is a hydro-electric power grid that removes Panhandle communities from dependence on high-priced diesel fuel.

While construction on the Swan Lake-Tyee Lake Intertie is stalled, a 9.7-mile underwater power cable will be laid in September to carry hydro power to the Greens Creek mine on Admiralty Island and on to Hoonah.

The economies of small communities are threatened by power rates four to five times those of towns on hydro power. The economic viability of Greens Creek mine is threatened as diesel fuel prices rise.

Which brings us to the sleeping giant in Southeast: mining.

Final permits were granted last week for the Kensington Mine at Berners Bay. That mine can benefit, too, from clean hydro power from Juneau.

Active mineral exploration is going on this year at Woewodski Island between Wrangell and Petersburg and close to their Tyee Lake power line.

One hundred years ago, a dozen mines operated in the Ketchikan district, on Gravina, Revillagigedo, and Prince of Wales islands and up the Unuk River. Two copper smelters operated on Prince of Wales. Those mines shut down because of the high cost of production and transportation compared with other parts of the world.

If Southeast can provide the power, mining could bring additional high paying jobs to the region. Of course we also need low cost access - roads and airport access. But that is another column.

In the meantime, Ketchikan rises again.

• Lew M. Williams Jr. is former publisher of the Ketchikan Daily News.

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