Alaska: New Report Ties Ferry System Funding to Economic Growth

Public investment in Alaska’s chronically-underfunded ferry system is producing an economic impact at a rate greater than twice its cost, according to a new report. 

The report, issued by the McDowell Group and funded by the Alaska Department of Transportation, concluded that the Alaska Marine Highway System produced a total economic impact of $273 million in 2014, based on $117 million in capital expenditures.

Marine transportation is an economic driver in Alaska. The state maintains 5,500 miles of inland waterways, ranking it first nationally, according to the American Society of Civil Engineers.

According to the study, the ferry system employs nearly 700 workers. Another 300 people work jobs dependent on ferry operations, most of them located in the southeast. Collectively, the labor pool earns more than $100 million in wages and benefits.

The McDowell Group
The McDowell Group

The ferry system provides basic transportation services to regional hubs for medical care, retail, travel, and other household needs, said Jim Calvin, co-principal of the Juneau-based McDowell Group. The ferry system “plays a particularly important role in both the visitor and seafood industries, but a wide variety of other businesses use the ferry to transport goods and materials essential for day-to-day operations,” he said.

Recognizing that public funding of infrastructure improvement is closely tied to energy revenues, now in decline, the report warned against further spending cuts. Calvin asserted that each dollar cut from infrastructure maintenance would diminish economic activity by $2.30.

“Alaska’s challenge at the moment is how to preserve the infrastructure we have in the face of major budget challenges associated with the sharp decline in oil prices,” said Calvin.

In a comment following the report’s release, Gov. Bill Walker said he was “surprised to learn just how widespread economic impacts are.”

Alaska 1
Source: The McDowell Group

In 2015, Alaska ranked 34th on Chief Executive’s Best & Worst States for Business. The quality of life is a good selling point and the low-taxation is an attraction for CEOs. However, companies in this isolated state struggle with finding enough qualified employees, and are concerned that low oil pricing will result in future tax increases.


MORE LIKE THIS

  • Get the CEO Briefing

    Sign up today to get weekly access to the latest issues affecting CEOs in every industry
  • upcoming events

    Roundtable

    Strategic Planning Workshop

    1:00 - 5:00 pm

    Over 70% of Executives Surveyed Agree: Many Strategic Planning Efforts Lack Systematic Approach Tips for Enhancing Your Strategic Planning Process

    Executives expressed frustration with their current strategic planning process. Issues include:

    1. Lack of systematic approach (70%)
    2. Laundry lists without prioritization (68%)
    3. Decisions based on personalities rather than facts and information (65%)

     

    Steve Rutan and Denise Harrison have put together an afternoon workshop that will provide the tools you need to address these concerns.  They have worked with hundreds of executives to develop a systematic approach that will enable your team to make better decisions during strategic planning.  Steve and Denise will walk you through exercises for prioritizing your lists and steps that will reset and reinvigorate your process.  This will be a hands-on workshop that will enable you to think about your business as you use the tools that are being presented.  If you are ready for a Strategic Planning tune-up, select this workshop in your registration form.  The additional fee of $695 will be added to your total.

    To sign up, select this option in your registration form. Additional fee of $695 will be added to your total.

    New York, NY: ​​​Chief Executive's Corporate Citizenship Awards 2017

    Women in Leadership Seminar and Peer Discussion

    2:00 - 5:00 pm

    Female leaders face the same issues all leaders do, but they often face additional challenges too. In this peer session, we will facilitate a discussion of best practices and how to overcome common barriers to help women leaders be more effective within and outside their organizations. 

    Limited space available.

    To sign up, select this option in your registration form. Additional fee of $495 will be added to your total.

    Golf Outing

    10:30 - 5:00 pm
    General’s Retreat at Hermitage Golf Course
    Sponsored by UBS

    General’s Retreat, built in 1986 with architect Gary Roger Baird, has been voted the “Best Golf Course in Nashville” and is a “must play” when visiting the Nashville, Tennessee area. With the beautiful setting along the Cumberland River, golfers of all capabilities will thoroughly enjoy the golf, scenery and hospitality.

    The golf outing fee includes transportation to and from the hotel, greens/cart fees, use of practice facilities, and boxed lunch. The bus will leave the hotel at 10:30 am for a noon shotgun start and return to the hotel after the cocktail reception following the completion of the round.

    To sign up, select this option in your registration form. Additional fee of $295 will be added to your total.