By KLAS STOLPE
Sentinel Staff Writer
While not commenting directly on Gov. Mike Dunleavy’s proposal to cut off all operational funding for the Alaska Marine Highway, the executive director of the Southeast Conference told a Sitka Chamber of Commerce audience Wednesday that the current operation model for the ferry system “is unsustainable.”
Creation of a state ferry system was a major goal of the Southeast Alaska communities and businesses that joined to form the Southeast Conference in 1958, said director Robert Venables.
“And of course we have stayed engaged passionately in that,” he said, adding that the conference and the Alaska Marine Highway are already engaged in a multi-year project to reform the system.
“It has got to be apparent to practically anyone that has been watching the Marine Highway system over the last decade that the system is in need of reform,” he said. “It was an unsustainable model, and we have been saying for the last 30 years things have to change. It could be that the ultimate outcome is not what is exactly being articulated at the moment, but we are trying to build a model that says here is how it should be run.”
It needs to be run more like a business, Venables said.
Southeast Conference Director Robert Venables speaks at the Sitka Chamber of Commerce noon luncheon Wednesday at the Westmark Sitka Hotel. (Sentinel Photo by James Poulson)
“We need to take the politics out of it as much as possible. May Bert Stedman live forever, and forever be the co-chair of Senate Finance, (but) just in case that is not the case, we have to build a governance model that’s going to use our folks with maritime expertise and the ability to make the decisions.”
In the past, he said, the system could be called “a poster child for dysfunctionality.”
“When you go to build the Alaska class ferry you have a vessel that has had five different governors touch the design for it,” he said. “We are trying to establish a long-term plan and it just changes from administration to administration without a lot of the public process that really needs to be involved.”
Taking the stance that the Marine Highway will survive, Venables laid out the challenges ahead. It’s not just about Southeast, Prince William Sound or Southwestern Alaska, but the larger state transportation system.
You don’t have to convince anyone in Southeast Alaska that the ferry system is important, Venables said, “but we do have to convince folks in the railbelt. We do have to show them why the ferry system benefits them, and there are benefits to the Interior… sometimes that ferry system traffic escapes them and goes unnoticed.”
As for the present, “One of the things we are most concerned with now is not just having a much smaller budget but how will they now make the decisions to spend that money and deploy the vessels.”
In his comments to the Chamber, Venables listed many of his organization’s recent accomplishments.
The National Association of Development Organizations (NADO) gave its 2018 Innovation Award to the Southeast Conference for its 2020 Economic Plan, the only plan in the state to receive the honor.
“It was not just for the projects in it but the process solidifying them,” Venables noted. “We believe in a public process. We had all the region involved… there were 1,300 posted notes all around the room as we were gathering data.”
In Energy, the conference is partnering with state and federal agencies to advocate for renewable energy development and advanced technologies. The SEC biomass operator training program at Coffman Cove is achieving energy savings of $400,000 annually, he said.
In Timber the conference is supporting the State’s petition to USDA for rule making to exempt the Tongass National Forest from the current application of the Roadless Rule to assure road access for mining and renewable energy and maintaining transportation corridors.
In Tourism Marketing created the Southeast Cruise Port Association Subcommittee and facilitated discussions on rural tourism. Since 2010, visitor industry employment has grown by 32%, with 1,900 new jobs. For 2019, cruise ship passengers arriving in the region is projected to be a 25% increase from 2017.
In the Seafood industry, SEC is championing specialty products that utilize harvested resources like kelp and seaweed to create new, value-added products, providing economic benefits to local communities.
In Mariculture industry the organization has been integral in 17 new aquatic farm/hatchery/nursery applications being submitted to the state by small and large companies in 2018, with a goal of having a $1 billion Alaska industry within 30 years.
In the Maritime Workforce Development Plan, Venables cited the UAS-Ketchikan Campus completion of a $6.5 million regional maritime and career center, and the construction of Marine Highway vessels Tazlina and Hubbard by the Vigor Alaska shipyard at Ketchikan.
Venables also touched on the SEC’s recent annual business climate survey, with responses from owners and managers of 320 businesses in 25 communities.
“We asked a new question,” he said. “Basically, what are your priorities for the budget.”
Venables said the answers were obvious.
“Do these things the most (reduce oil tax credits, reduce PFD payments) and do these things the least (AMHS cuts, K-12 cuts, state property tax)..” he said.
The survey asked the question:
“The State of Alaska has been struggling to develop a fiscal solution to the budgetary gap. Please rate your preferences regarding how you would like to see the state achieve a balanced budget.”
He said 77% said they supported reducing the tax credits to North Slope oil producers, with suggested ranges from “to the fullest extent possible” to “a small amount.”
Also, 71% percent were in favor of a Permanent Fund dividend cut ranging from “the fullest extent possible” to “a small amount,” with the savings in the earnings account used for state services.
A total of 63% said they supported some level of a state income tax, while 52% percent approved of a state sales tax to reduce the drain on state savings accounts.
Cuts to core services like public schools and the state ferry system ranked the lowest in priorities for balancing the budget, along with a state-wide property tax.
“While each community had a little variation, Sitka was pretty much identical with all,” Venables said. “You even had stronger support for the Marine Highway system, and you guys get some of the worst service, bless you. Thank you.”
The Southeast Conference will be have its annual meeting in Sitka Sept. 18-20.
