Process to Streamline Alaska’s $3.2 Billion Economic Development Activities Begins
March 10, 2016
(SitNews) Juneau, Alaska -Governor Bill Walker today signed Administrative Order 281 to begin the process to explore options for a more streamlined and effective approach to economic development in the state. Three state corporations - Alaska Housing Finance Corporation (AHFC), Alaska Energy Authority (AEA) and Alaska Industrial Development and Export Authority (AIDEA) - will participate in finding potential opportunities for efficiency and consolidation.
“It’s important that members of these economic development agencies play an active role in finding opportunities to improve both effectiveness and efficiencies,” Governor Walker said. “As the state scales back on spending, we must also diversify our economy. I look forward to seeing the recommendations put forth by AEA, AIDEA and AHFC on the most efficient way to do so.”
About 440 people work at AEA, AIDEA and AHFC, which have a combined $3.2 billion in net assets.
“Today’s current environment of low oil prices and declining production necessitates a proactive response that signals to bond holders, business partners and Alaska families that our agencies are committed to doing our part to improve the economic health of the state,” said Bryan Butcher, AHFC CEO and Executive Director. “This administrative order sets in motion an initiative to strengthen and give laser-focus to AHFC’s assets, capabilities and talents.”
The steady decline in oil production and an outlook for a prolonged period of low oil prices is driving structural fiscal and economic change in Alaska. Quoting Administrative Order 281, waiting for the circumstance to self-correct is not an option. The State must deal with its new economic reality in a bold and thoughtful manner in order to ensure future prosperity.
The current structure and focus of AHFC, AEA, and AIDEA consistent with objectives of the Administrative Orderwill be evaluated. These three public corporations of the State were established decades ago and designed to support specific activities in furtherance of State objectives. Although these corporations have delivered a great deal of benefit to the state, it is time to consider whether they are currently optimally structured to dynamically facilitate future economic growth and diversification.
Objectives of the Administrative Order:
- Create economic vitality in Alaska with opportunities for every community in Alaska to grow and prosper.
- Streamline and better focus the State's economic development institutions, specifically the Alaska Housing Finance Corporation (AHFC), the Alaska Energy Authority (AEA), and the Alaska Industrial Development and Export Authority (AIDEA);
- Identify enterprise or other models of development that can be applied to housing, power generation and transmission, water and wastewater, broadband, health, and natural resource industries and infrastructure to simultaneously increase quality, access, and reduce costs of providing services;
- Engage with stakeholders in a transparent and open process to develop strategies for economic development that optimizes the use of State powers and resources and strengthens the relationships among public, tribal, nonprofit, and private enterprise stakeholders;
- Efficiently use the assets of public corporations of the State;
Engage with stakeholders in a transparent and open process to find efficiencies and reduce costs associated with the State's public corporations;
- Protect the interests of bondholders, assets of the State, and affected entities to ensure an orderly process and maximum protection of State finances; and
- Identify State lands and facilities having a potential for economic development.
AHFC, established in 1971, is an active investor on Wall Street that allows for low-cost mortgage financing across Alaska, provides 10,000 Alaskans with public housing each night, supports construction of special needs housing, and promotes energy efficient homes and public facilities.
“This initiative ensures we are engaging in an inclusive process with the stated goals,” said John Springsteen, AIDEA Executive Director. “Through this collaboration we look forward to enhancing our toolkit to support enterprise development in Alaska.”
AIDEA, created by the Alaska Legislature in 1967, is the State’s development finance authority. AIDEA advances economic growth and diversification in Alaska by providing support to business and industry through its comprehensive financing capabilities. As a result of this partnership with Alaskans, thousands of jobs have been created or retained across the state.
“As we advance this initiative we will engage in an inclusive process that includes private sector experts and corporation partners, employees, the legislature, and Alaskans,” said Sara Fisher-Goad, AEA Executive Director.
AEA has worked for the past 40 years to diversify Alaska’s energy portfolio, provide assistance to rural Alaska communities, lead strategic energy planning and construct energy systems. AEA administers the Renewable Energy Grant Fund and Emerging Energy Technology Fund and owns the Bradley Lake Hydroelectric project and Alaska Intertie.
Governor Walker has requested a report of recommendations ahead of the next legislative session.
On the Web:
Administrative Order 281
Edited by Mary Kauffman, SitNews
Source of News:
Office of Gov. Bil Walker
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