My turn: Mega-projects are not the solution to the economic woes of rural Alaska

Posted: Monday, November 08, 2010

Alaskans like to think big when it comes to economic development. Although many Alaskans profess to dislike government, proposals to broaden our shaky economic base always require the involvement of the state and federal governments.

Little wonder since the government controls virtually all of our coastal waters and almost all of the uplands. Alaska's large savings accounts and willingness of the Legislature and U.S. Congress to spend hundreds of millions of dollars on capital projects certainly help fuel these schemes.

Mega-projects attract much attention (gas line, Nome highway, Susitna dam, Pebble Mine, etc.), but our economy continues to be reliant on the declining flow of oil from Prudhoe Bay and a massive influx of federal dollars which now appears to be slowing to a trickle. The outlook for rural Alaska is particularly sobering.

Small communities along the Gulf of Alaska are a case in point. The impact of the collapse of the timber industry and job loss from a constricting fishing industry over the past two decades has been devastating. Consider that Alaska's population should increase by 35 percent between 1996 and 2030, while six of the eight census districts in Southeast should decrease by 27 to 62 percent over the same period, according to projections by state economists.

So, what can be done? How can we create profitable businesses and jobs in areas where costs are very high, transportation infrastructure is almost non-existent and labor pool very shallow? Certainly, extraction of non-renewable resources can generate enough value to overcome these challenges, but these projects are relatively short-term in nature and can have adverse impacts upon other resources.

A community-led initiative to stimulate the growth of small businesses on Prince of Wales Island appears to hold promise. When the logging industry collapsed, the former logging camp of Naukati had virtually no economy. Community leaders began working with oyster farmers and the Marine Advisory Program on ways to attract more shellfish businesses.

During the past 15 years, this coalition has made significant progress, with a lot of hard work and creation of some unique approaches to economic development. Since access to seed was a major concern of growers, the coalition sought and secured grants to construct and operate a shellfish nursery in Naukati. The grant dollars were matched by local residents volunteering hundreds of hours of labor. The community-operated nursery has become the state's largest supplier of oyster seed.

The unincorporated community then created a unique program (with the help of another small grant) that has allowed new growers to learn oyster husbandry and start growing their own crop while obtaining permits for their own aquatic farm sites. The nursery and "weekend warrior" program has helped triple the number of oyster farms in the Naukati area, and interest continues to grow.

Indeed, shellfish farming in the region has increased significantly over the past several years. Sealaska launched a program designed to help village residents start their own farms. A joint venture with Yak-Tat Kwaan recently resulted in the creation of three new farms in Yakutat and another partnership with an established oyster farmer resulted in new jobs in Kake.

While these numbers lack the pizzazz of a Pebble Mine, they are significant to the continued viability of small communities. Alaska shellfish growers spend 75 percent of their gross revenues within 50 miles of their farms and employ 2-3 people. The addition of 8-10 of these businesses can have a huge impact in a small community. Importantly, these businesses can continue for many generations, and Alaska can support literally hundreds of aquatic farms.

What's government's role? Infrastructure, technology transfer, training and education, research, use of state and federal uplands and support of food safety programs required for the industry to operate all are vital roles for government.

So far the response of the state of Alaska has been modest, but we're hoping the current attention being focused upon creation of sustainable, environmentally friendly jobs may increase the level of enthusiasm and support for these community-based initiatives.

What a change it would be for the state to be excited about small business rather than the next mega-project.

• Painter has been a close observer of Alaska politics over the past 35 years and is president of the Alaskan Shellfish Growers Association. He can trace his family roots in Alaska to 1790.



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