Here’s what Alaska’s gubernatorial candidates say they’ll do about the state housing shortage

Last year, housing prices in Alaska hit a record high, with the average sale price of a single-family house topping $388,000. The average cost of a rental rose 8% this spring, to $1,276 per month, and rental prices in Anchorage rose 14%.

These increases aren’t isolated to Alaska but have been exacerbated here by a decline in new-home construction. Since 2014, the number of home construction permits for three or more units has fallen from more than 600 per year to less than 200.

Here’s what Alaska’s governor candidates say they would do, if elected, to deal with the state housing shortage:

Les Gara

Democratic candidate Les Gara and independent candidate Bill Walker were the only two candidates to attend an Oct. 8 forum hosted by the Alaska Coalition on Housing and the Anchorage Coalition to End Homelessness.

The housing shortage “is one of those sort of subsurface crises that’s building in Alaska,” Gara said during the 80-minute event

He noted that the Alaska Housing Finance Corporation, a state-owned agency, pays a dividend to the state treasury each year. He suggested the corporation keep that money and invest it back into housing, coordinating with tribal, nonprofit and private housing groups.

“I think we’re going to have to start sacrificing some of that dividend to get people housing so that a family can start a home, so somebody can afford an apartment. Because right now, it’s a crisis,” he said.

Gara suggested the creation of a task force to coordinate housing efforts among various groups in order to better obtain federal funding for projects.

“If everybody’s doing it on their own, maybe they don’t realize that there’s one solution, and all three of them don’t have to do it. And maybe one of them can leverage federal funding that another one can’t,” he said.

Bill Walker

Walker, who served as governor from 2014 through 2018, noted that he created a housing summit in 2015 that did much of what Gara hopes to accomplish, “but we found ourselves, shortly thereafter, with a $4 billion hole in our budget” that made addressing the issue impossible.

Still, he said it’s a worthwhile idea and “would do the same again” as part of an approach to “be a little more aggressive and a little bit hungrier in going after federal funds.”

Walker, who worked as a carpenter in Valdez when younger, said he has “been involved in house building pretty much all my life.”

He said that in many cases, he believes that a lack of buildable land, not just funding, is hampering home construction. To that end, he believes the state should create a land trust, similar to one already in action in Sitka.

There, the trust builds affordable houses and sells them but keeps ownership of the land and three quarters of any increase in the home’s appraised value. For example, if someone buys a house at $200,000 and its value rises to $300,000, the homeowner would get $225,000 when they sell it back to the trust. The trust can then sell the house to a new buyer at less than its appraised value, keeping costs low.

Walker said there’s also a role for the state to play in helping make locally cut lumber more available for local construction.

That idea, announced in September by the Department of Natural Resources, would allow the state to change lumber-grading practices to ease local sales for Alaska sawmills.

He said that while he believes that local solutions tend to be better than top-down approaches, there is a need for a coordinated approach.

“All communities want to solve this problem,” Walker said of the housing shortage. “I haven’t seen a single one that said, ‘We don’t want to solve our housing problem.’ They’re just limited on what they can do as a community.”

Mike Dunleavy

Incumbent Republican Gov. Mike Dunleavy did not attend the housing forum, but his campaign spokesman, Andrew Jensen, outlined the governor’s position by email.

In office, Dunleavy has repeatedly proposed legislation to increase the amount and pace of state land sales, which would make more property available for private development.

Over the past four years, according to legislative records, the Legislature has not passed any of the land-related bills proposed by the governor.

Jensen said Dunleavy “has and will continue to press for legislation” to get more state land in Alaskans’ hands.

Another tool, Jensen said, is the Alaska Housing Finance Corp., which received $21 million — a record amount — to build housing for teachers, health care workers and law enforcement employees.

“AHFC can also work with local partners to address housing needs, but the best solutions for jurisdictions like Anchorage will have to come from local governments who have the most control over their permitting systems and the creation of incentive programs to spur development for affordable housing,” Jensen said. “Where the state of Alaska can be of assistance, the Dunleavy administration is always willing to work with local governments to address issues such as housing availability and affordability.”

Charlie Pierce

Republican challenger Charlie Pierce also did not attend the housing and homelessness forum. Pierce did not return a message seeking comment on his housing plan, a former campaign official said he was unaware of any remarks Pierce has made on the subject, and Pierce does not address the issue on his campaign website, social media or advertising.

Speaking about budget issues in general, Pierce has advocated a position of austerity, saying he is unwilling to raise taxes or new revenue and that additional funding for a new priority must come at the expense of cuts elsewhere.