Port, CBM development keys to borough's fiscal health

Spectrum, by Corri Feige

With the recent announcement by the Mat-Su Borough that it is facing an $8 million shortfall in its school district budget, more families in Southcentral Alaska are awakening to the fact that the long-forecast fiscal crunch is really here. State General Fund revenues are in decline and borough governments are receiving a smaller piece of the pie than ever before. New sources of tax revenues, new jobs and new businesses throughout all of Southcentral Alaska are the only clear path through this fiscal swamp.

But where might this new industry and new wealth come from? Increased taxes, new taxes, and expansion of existing business sectors like tourism may help to fill the gap, but it is clear that new industry is going to be the only thing to end the feast-or-famine fiscal cycle the Mat-Su Borough currently finds itself in. At present, there are only two new developing industries in the borough likely to generate a base of jobs and new tax revenues significant enough to turn the tide of the budget decline in years to come. Port MacKenzie and coal-bed methane development are those industries.

Both of these projects have been publicly criticized, each for different reasons. In the case of coal-bed methane development, however, the issue has been cast in an extreme light that shadows the benefits and realities of responsible development, and focuses on production scenarios with no relevance to Alaska. The latest bit of misinformation circulating around the CBM issue is the assertion that all of the gas, jobs and economic benefits will leave Alaska and not be available to the people of Mat-Su. Nothing could be farther from the truth. With the imminent approach of larger class sizes and fewer teachers in borough schools, it is time to think seriously about the very real benefits that can come form CBM development and the diverse economy it will help build.

Should the exploration program being undertaken by Evergreen Resources be successful, CBM development in the Valley could mean 230 full-time, well-paying jobs complete with benefits like health insurance and retirement. Additionally, another 300 jobs could be created in the contractor and supply sectors. Taxes assessed by the Mat-Su Borough each year for improvements and facilities could be in the millions of dollars. Last year alone, Evergreen Resources paid more than $2.9 million dollars in taxes in Las Animas County, Colo., where Evergreen is the largest single county taxpayer and where the oil and gas industry account for more than half of the taxes paid to the county each year. With CBM development in the Mat-Su, not only would more gas be flowing in the pipelines of Southcentral Alaska, but more money -- new money -- would be flowing into the coffers of the Mat-Su Borough. A diverse economy, like that which CBM development would help build in the Mat-Su, ensures that government-supplied services like education continue to thrive when times are tough in one business sector or another. This fact of economics is at work everyday in places like the Kenai Peninsula Borough where tax revenues from oil and gas development account for one out of every four dollars, and property tax burdens on private citizens are some of the lowest in the state.

Critics of CBM development have claimed that it would destroy all that makes Alaska special, with no benefit to those who live here. Alaska has a long history of balancing energy development with the values and needs of the people. We have always been able to come to the table with developers and work out a plan that ensures the protection of our environment and our way of life. What will destroy Alaska faster than any drill rig or gas well is a stagnant economy and poor schools. Our children will not have the tools and skills needed to get good jobs or to excel in schools beyond Alaska, and they will have no quality of life and no jobs to come home to.

Corri Feige is the manager of Governmental Affairs and Public Relations for Evergreen Resources (Alaska) Corp.