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12122016 City Council Laydowns
b� CrJu�c� COSTS �r PRE OCT 2016 POST OCT 2016 DIFFERENCE Yearly $61,000.00 $67,200.00 �,,200,00 Monthly $5,064.00 $5,600.00 $536.00 Daily $211.00 $350.00 Days Open/yr 288 192 Hour Open/wk. 41 38 FEES Yearly $200.00 $300.00 Daily drop in $4.00 $5.00 Daily punch $2.00 $4.00 Notes: cost increases across the board with the "new" negotiated contract have resulted in decreased access to this facility to the pubic. The result is the public paying more for less A e,10 f,04®_�� Birch Horton Bittner & Cherot a professional corporation December 8, 2016 Mayor and Members of the City Council City of Seward P.O. Box 167 Seward, AK 99664 William A. Earnhart Respond to Anchorage Office T 907.263.7285 • F 907,276.2822 wearnhart@bhb.com RE. City Attorney Report for the Period November 22, 2016 through December 11, 2016 Our File No.: 507,486.1002 Dear Mayor and City Council: The following summarizes our activities as the City Attorney during the period November 22, 2016 through December 11, 2016: 1. General Matters: The City Attorney's office provided advice and worked on various matters regarding leases and extensions, deeds, contracts, resolutions and public records requests. 2. Litigation: In the Orion litigation, costs and fees of just under $19,000.00 have been awarded to Seward and we prevailed against Orion's Motion for Reconsideration. Orion has appealed the Judgment and is unwilling to discuss settlement. Orion has posted a bond for the outstanding judgment and has until February 13, to file its brief on appeal. 3. Electric Utility: We are also advising and participating in negotiations to protect Seward's interests regarding the Bradley Lake agreements. Please contact me if you have any questions or desire further information on any of the matters discussed above. Sincerely, BIRCH HORTON BITTNER & CHEROT William A. Earnhart WAE:alk cc: Jim Hunt, City Manager 1127 West Seventh Ave. Anchorage, AK 99501-3301 T 907.276.1550 • 800.478.1550 • F 907.276.3680 1156 15th St. N.W., Ste. 1020, Washington, D.C. 20005-1754 T 202.659 5800 • F 202.659.1027 50748641002\00562172 CMR December 12, 2016 Electric Department 1. Number of outages/trouble calls in November: 10 - Number of new Job Orders started since Jan. 1, 2016: 54 2. The crew is done with the construction season until next spring. A big thank you to the crew for their hard work and perseverance. 3. We have received 6000 meters from Kodiak Electric for the cost of shipping. We intend to transition to these new meters throughout our system and eliminate all the old meters as well as different variations. The electric department intends to roll out a plan to council early next year. 4. The City is now on the 811 for all digging and locates. Although the dig permits are still available with public works, the departments will be transitioning to 811 dig line as the primary means to verify underground utilities. If anyone from the public has questions about underground utilities we encourage them to still come in and talk to us for electric and Public Works for water and sewer. This is an attempt to make the process more efficient for our customers, but if customers feel more comfortable talking to us in person please come to the offices and we will be happy to help. 5.On 11/28 the Line Crew checked the Christmas tree on the hill and discovered that there was a problem with the lights. The problem seems to be a short. As the safety of the employees is the highest priority, staff will not be sent up the mountain for repairs if it seems unsafe. A volunteer will hike up Friday and is willing to take pictures and report on the condition of the trail leading to the site. Contingent on his report, the trail may be safe enough to send crew, equipment and materials up there to repair the lights. We will not know this until next week. We hope this matter will be resolved soon. 6. Snow River Project Completion Report Attached Harbor 1. We had construction meetings with Hamilton Construction and R&M for the SMIC breakwater project on 11-17-2016 and 12-1-2016. 2. Hamilton Construction is on a holiday break, they will have a small crew to work weather permitting. Starting January 2 they will be back with a full crew to finish the project. 3. The Harbor has hired a new Administration Assistant to replace the one that has moved on to fulfill her career goals. 4. Another administrative assistant has given her notice to fulfill her career goals in teaching/ we are currently in the process of hiring another admin assistant. 5. We have installed one of the floats for the polar bear jump; the second one should be installed soon. 6. PACAB is currently working on the Comp Plan. 7. The National Park Service has revised their site master plan for the Visitors Center. (attached) 8. On 11-17 we sent out 541 moorage renewals as of 12-1, 75 (14%) have renewed and 2 slip relinquishments. 9. ABCS Floats Project Completion and Fish Cleaning Station Reports Attached Finance Finance staff is preparing work on a major project with the electric department to plan for replacement of system -wide electric meters to take advantage of new technologies. This will require assistance from our utility billing software firm, as well as a firm to assist with the Meter exchanges. This will likely come before the Council for discussion at January's mid -cycle budget discussion where we will discuss the project, its benefits, a proposed timeline, and the associated costs. Finance staff have attended utility billing training and are considering new utility customer payment options which could allow customer payments via smart -phone, as well as options to reduce credit card processing fees for the City by passing on convenience fees. Previously staff recommended fees not be passed along to customers due to limited flexibility in how to assess fees differently between smaller monthly utility bills (for example)compared with harbor annual moorage payments, etc. but we are reconsidering due to new third -party processing options. We are also examining electronic billing options which would enable customers to receive bills via e-mail and opt out of paper bill mailings. Finance is developing options for Council's consideration with respect to repayment of a bond not to exceed $3 million, as approved by the voters for the upcoming spring road improvement project. Annual bond payments are estimated at approximately $230,000. We plan to work with JDO's Cynthia Cartledge again, as bond counsel for this bond, and will soon request a work session to discuss bond repayment options and a special council meeting to approve a bond resolution. Alaska Municipal Bond Bank informed us on December 7, that the bond bank board will hold their board meeting on January 10 for a bond sale anticipated for late March/early April timeframe. Staff is researching and is likely to propose an ordinance change with respect to bed tax, as a result of the proliferation of new room reservations systems such as Air BnB and VRBO, to ensure that all nightly rentals are properly registered and are reporting and remitting bed tax. PARKS and REC Community Playground Waterfront Erosion Project Completion Report Attached PROJECT COMPLETION REPORT Snow River Transmission Line Revetment 1 PROJECT SUMMARY 1.1 DEPARTMENT INFORMATION: Department: Electric POC: Type of Report: Final 1.2 CONTRACT INFORMATION: Contract Number: C16-056 Purchase Order Number: Contract Type: Fixed Price Award Date: 09/12/2016 Completion Date: 10/27/2016 Award Value: $ 1,972,080.00 Current/Total Dollar Value: $ 1,972,080.00 Contingency Value: $ 197,208.00 Change Order Value: $ 0.00 1.3 CONTRACTOR INFORMATION: Contractor Name/Address: Hamilton Construction: P.O. Box 241952, Anchorage, AK. 99524. Tel: 907-334-3910 1.4 KEY SUBCONTRACTORS: Subcontractors Name/City/State: Shannon&Wilson (AWR): Geotechnical Study, $33,300 w/Cont. 05/13/2016 Survbase (AWR): Hydrographic Survey, $32,463 w/Cont. 05/13/2016 Soltice Alaska Consulting (AWR): Permitting/Grant Scope, $18,860 w/Cont. 05/13/2016 1.5 CONTRACT/PROJECT DESCRIPTION: General Scope of Work/Services: Construction: Adding Rip -Rap to Snow River Bank to ensure the continued stability of the Transmission line at about mile 17.75 of the Seward Highway. 1.6 PROFESSIONAL SERVICES -DESIGN: Contract Number: Purchase Order Number: 740 Contract Type: Time & Material Award Date: 05/13/2016 Completion Date: Award Value: $ 48,965.00 $ 48,965.00 Current/Total Dollar Value: Contingency Value: $ 4,896.00 $ 4,896.00 Change Order Value: 1.7 FIRM INFORMATION: Contractor Name/Address: AWR Engineering: P.O. Box 190684, Anchorage, AK. 99519. Tel: 907-441-2973 1.8 PROFESSIONAL SERVICES —CONSTRUCTION MANAGEMENT AND INSPECTION: Contract Number: Purchase Order Number: Contract Type: othez Award Date: Completion Date: Award Value: Current/Total Dollar Value: Contingency Value: Change Order Value: 1.9 FIRM INFORMATION: Contractor Name/Address: 1.10 TOTAL PROJECT COSTS: Design Costs: $ 133,588.00 Construction Costs: $ 1,972,080.00 CM/Inspection Costs: $ 0.00 TOTAL PROJECT COST: $ 2,105,668.00 $ 133,588.00 2 QUALITY 2.1 BENEFITS ACHIEVED: The Transmission line next to the Seward Highway between mile 17 and 18 is now secure and will be less likely to be washed away. 2.2 BENEFITS NOT ACHIEVED: High water situations may still jeopardize the T197 structure guy wires. Relying on DOT to complete the protections with their mile 17 to 25 road project. 2.3 FACTORS AFFECTING BENEFITS: Relying on DOT to complete protections around Snow river bridge crossing. DOT did not pay anything for this project, but they are expected to pay all the money for the second part of the project. The City must keep reminding them of that. 3 SCHEDULE 3.1 TASKS EXCEEDING TIME: 3.2 TASKS REQUIRING LESS TIME: The Construction was estimated to take two weeks but only took 10 days. 3.3 FACTORS AFFECTING TIME: Getting a signed contract in place before construction was a challenge. The contractor was eager to get started but we needed to complete the paperwork before they could start. 4.1 COSTS EXCEEDING ESTIMATES: 4.2 COSTS LOWER THAN ESTIMATES: 4.3 FACTORS AFFECTING COSTS: Hamilton committed to a specific cost for the project and honored that cost even though they used approximately 2000ft^3 more than the estimate called for. S LESSONS LEARNED 5.1 POSITIVE OR NEGATIVE OUTCOMES: Need to make sure DOT follows up with the second phase as part of their road project scheduled for 2018. 6 RECOMMENDATIONS 6.1 RECOMMENDATIONS FOR ACTION: 6.2 RECOMMENDATIONS FOR FUTURE PROJECTS: Need to make sure DOT follows up with the second phase as part of their road project scheduled for 2018. The electric department is going to weld some additional steal protection onto the pilings for the guy wires on structure T197 blade sign• KEF1NationalPark L— _ _ _ _ _ _ _ _ _ _ I Emergency Veffide, Pedestrian 8 City Access Easement Fd. �� P S89'50'2YW — _ Fd. F�•� AI. Cap _ .87, +j �•� Y X q t,+ \` C I I m Con V h /ham• ' r I t ''�••r h� _ windscreen and _ �€ p � gathering area z Q. V Visitor Center _. _�_ --- --.. ._. _ for 20 - 25 Wind screen � D ::4' �0, y i O �j �'.� �` people SITE PROGRAM / LOT P i 14 I 0 Decking (with ramp and railings) - sculpture: 10,591 sf - 1000 sf accessible at sidewalk t - .. - - © Curbing (with curb cut for grade accessible parking) - 125 If Jq - I ©fourWind (rock gabion wall at ramp up to } ,.�"�': _ > r space . I foot tall)'30 If front entry decking Aftv Comfort Q Rock gabion seats/benches (with and �Q Paving - 2,5no St Station 0 / composite decking on top for s7 seat): on south side and on front deck at building entrance boulders or bollards: to prevent vehicle -= © Concrete plaza (south and west side of visitor center) - 2510 sf traffic onto plazas / olio safari Lodge ID Boulders - (20 total) r Easting Boardw Q Gravel surfacing - 775 sf F' accessible parking -- 3 Fd. A. Cep space N89' Fd. PK - _ - - Fd. AI_C�jt _ _ —� o o zo — Q Landscaping - 600 sf Nall Public Boat Launch & Lftllity Easement site master O OPTION A: extend decking from into access for fish carts plan comfort station south side plaza; connect to west side to cleaning tables Kenai Fjords National Park - VISITOR CENTER decking - new decking on front of from boat launch area 916 REVISED 07/01 /2016 building PROJECT COMPLETION REPORT A, B, C, and SD -Float Replacement Project 1 PROJECT SUMMARY 1.1 DEPARTMENT INFORMATION: Department: Harbor POC: Norm Regis 1.2 CONTRACT INFORMATION: Contract Number: C15-076 Contract Type: Fixed Price Award Date: 08/28/2015 Award Value: Contingency Value: 1.3 CONTRACTOR INFORMATION: Contractor Name/Address: Type of Report: Final Purchase Order Number: 694 Completion Date: 04/30/2016 $ 546,400.00 Current/Total Dollar Value: $ 0.00 Change Order Value: Turnagain Marine Construction Corporation 9330 Vanguard Dr, Suite 100 AnrhoraPa Alaska cM07 1.4 KEY SUBCONTRACTORS: Subcontractors Name/City/State: Puffin Electric 3808 Ben Walters Lane Homer, Alaska 99603 1.5 CONTRACT/PROJECT DESCRIPTION: General Scope of Work/Services: $ 5,440,000.00 -$ 16,000.00 la n The scope of work generally includes demolishing existing C and S and a portion of G floating docks, demolishing a portion of B float timber access trestle, demolishing the S float timber access trestle, furnishing and installing new B and C and a portion of G floating docks, furnishing and installing new gangway landing floats at S and B floats, furnishing and installing a new access trestle at S float, furnishing and installing a new steel pile at the end of the B float access trestle, furnishing and installing a new 6'x80' aluminum gangway at B float, installing an owner furnished 4'x100' aluminum gangway at S float, furnishing and installing new galvanized steel piling, furnishing and installing piped potable water and fire protection systems, furnishing and installing electrical 0 1.6 PROFESSIONAL SERVICES -DESIGN: Contract Number: C14-102 Purchase Order Number: 346 Contract Type: Fixed Price Award Date: 12/08/2012 Completion Date: Award Value: $ 151,102.00 $ 151,102.00 Current/Total Dollar Value: Contingency Value: $ 0.00 $ 0.00 Change Order Value: $ 0.00 1.7 FIRM INFORMATION: Contractor Name/Address: R&M Consultants, INC. 9101 Vanguard Drive Anchorage, Alaska 99507 1.8 PROFESSIONALSERVICES —CONSTRUCTION MANAGEMENT AND INSPECTION: Contract Number: C-14-102 Purchase Order Number: 346 Contract Type: Time & Material Award Date: 09/15/2015 Completion Date: 06/09/2016 Award Value: $ 134,653.00 Current/Total Dollar Value: Contingency Value: $ 0.00 Change Order Value: 1.9 FIRM INFORMATION: Contractor Name/Address: R&M Consultants, INC. 9101 Vanguard Drive Anchorage, Alaska 99507 1.10 TOTAL PROJECT COSTS: Design Costs: $ 151,102.00 Construction Costs: $ 5,440,000.00 CM/Inspection Costs: $ 91,764.60 TOTAL PROJECT COST: $ 5,682,866.60 $ 151,102.00 $ 0.00 $ 91,764.60 $ 0.00 2 QUALITY 2.1 BENEFITS ACHIEVED: All creosote pilings have been removed all the old creosote docks from 1966/67 have been replaced with new floats no wood is in the water. New handicap trestles have been installed with new GFCI code requirements 2.2 BENEFITS NOT ACHIEVED: A -float does not have individual power to each slip. S-float does not have power for vessels. 2.3 FACTORS AFFECTING BENEFITS: No release of chemicals from the creosote piles. No wood to rot sitting in the water. The smaller vessels that use A and S-float have not had power in the past, we have not had many request for power on A and S-float. 3 SCHEDULE 3.1 TASKS EXCEEDING TIME: The new electric Remote Utility Monitoring system had a small problem they had to order a taller antenna which took an extra week. Some of the electrical components were delayed by shipping but were installed in time. 3.2 TASKS REQUIRING LESS TIME: The floats were installed quickly with the new design from Transpac marine. 3.3 FACTORS AFFECTING TIME: Shipping to Alaska from Seattle some weather windows for shipping was adhered to but no major delays were noted. 4 COST 4.1 COSTS EXCEEDING ESTIMATES: There were no cost exceeding estimates 4.2 COSTS LOWER THAN ESTIMATES: We saved some funds by rerouting some electric and not using all the extra leveling flotation and an electric repeater for the Remote Utility Monitoring System, By the Harbor master staff doing on site daily inspections we saved over $31,000.00 in engineering fees 4.3 FACTORS AFFECTING COSTS: The well designed docks were built with the correct flotation so that additional flotation was not needed for leveling of the floats. The pile driving took less time, which saved funds by not having the engineer here an additional two weeks for inspecting the pile driving. 5 LESSONS LEARNED 5.1 POSITIVE OR NEGATIVE OUTCOMES: This project was done without a contingency I do not recommend this because some factors came up that required fixing, this could not have been done in time by going back to Council for additional funds, the Harbor staff accomplished rebuilding the B-float abutment with City equipment and funds out of the Harbors 2016 budget. If we had a 10% contingency with a 50/50 match from the State would have helped with o 6 RECOMMENDATIONS 6.1 RECOMMENDATIONS FOR ACTION: Allow for a contingency on projects, our budgets have been reduced and using Staff time and Budget funds to complete change orders or fix issues that pop up is not good for the project or the budget. 6.2 RECOMMENDATIONS FOR FUTURE PROJECTS: Allow contingencies 1 1.1 1.2 PROJECT COMPLETION REPORT NORTH EAST HARBOR FISH CLEANING STATION PROJECT SUMMARY DEPARTMENT INFORMATION: Department: Harbor POC: Norm Regis CONTRACT INFORMATION: Contract Number: C15-037 Contract Type: Fixed Price Award Date: 04/27/2015 Award Value: $ 549,193.00 Contingency Value: 1.3 CONTRACTOR INFORMATION: $ 54,000.00 Contractor Name/Address: Harmon Construction Inc P.O. Box 1650 Seward Alaska 99fF,4 1.4 KEY SUBCONTRACTORS: Subcontractors Name/City/State: Storm Chasers P.O. Box 757 Seward, Alaska 99664 1.5 CONTRACT/PROJECT DESCRIPTION: General Scope of Work/Services: Type of Report: Final Purchase Order Number: 459 Completion Date: 04/30/2016 Current/Total Dollar Value Change Order Value. - $ 550,468.00 $ 1,275.00 0 7 The scope of work includes removing the existing North launch ramp float in the North East corner of the small boat harbor, demolishing the end float and other items, grading the site under the new launch ramp floats, furnishing and installing rip rap erosion protection, reinstalling the existing launch ramp floats after grading, furnishing and installing three new timber floats each approximately 10 feet wide by 28 feet long, furnishing and installing two new fish cleaning tables with roofs, furnishing and installing a piped potable water system for the fish cleaning station, furnishing and installing new galvanized steel piling and installing salvaged galvanized steel piling to restrain the existing float system, and other associated work. 8 1.6 PROFESSIONAL SERVICES -DESIGN: Contract Number: C14-056 Contract Type: Time & Material Award Date: 07/14/2014 Award Value: Contingency Value: $ 0.00 1.7 FIRM INFORMATION: Contractor Name/Address: R&M Consultants Inc. 9101 Vanguard Drive Anchorage, Alaska 99507 Purchase Order Number: 548 Completion Date: 04/30/2016 Current/Total Dollar Value: $ 0.00 Change Order Value: $ 0 00 1.8 PROFESSIONAL SERVICES —CONSTRUCTION MANAGEMENT AND INSPECTION: Contract Number: C14-056 Purchase Order Number: 548/152 Contract Type: Time & Material Award Date: 07/14/2014 Completion Date: 04/30/2016 Award Value: $ 87,894.50 Current/Total Dollar Value: Contingency Value: $ 0.00 Change Order Value: 1.9 FIRM INFORMATION: Contractor Name/Address: R&M Consultants Inc. 9101 Vanguard Drive Anchorage, Alaska 99507 1.10 TOTAL P ROJ ECT COSTS: Design Costs: $ 0.00 Construction Costs: $ 550,468.00 CM/Inspection Costs: $ 75,361.00 TOTAL PROJECT COST: $ 625,829.00 $000 $ 75,361.00 $ 0.00 2 QUALITY 2.1 BENEFITS ACHIEVED: A new modern fish cleaning station with over double the cleaning area to clean fish and properly dispose of the carcases while keeping the wildlife out of the gut barge. You can offload your boat right at the fish cleaning station and remove your vessel from the water while someone cleans the fish. Also the harbor can remove this barge at any tide. p 2.2 BENEFITS NOT ACHIEVED: We did not have the funds within the project budget to put a life ring, fire extinguisher and a safety ladder, but we have ordered those items and they will be installed, the funds will come from the 2016 Harbor budget. 2.3 FACTORS AFFECTING BENEFITS: More fisherman can now clean their fish, the barge is always floating keeping the birds from getting trapped inside the gut barge. Currently with the front and end of the barge has anti sea -lion devices installed it should keep them out. 3 SCHEDULE 3.1 TASKS EXCEEDING TIME: Building the 3 new docks and the fish cleaning tables could have been done sooner but the subcontractor was busy with other task. The project was still completed on time. 3.2 TASKS REQUIRING LESS TIME: The Harbor staff rebuilt the old docks in the winter of 2014/2015 as time permitted which saved money that the project budget could not have supported. The harbor staff also removed the docks for the ground work, then returned them to finish the project. 3.3 FACTORS AFFECTING TIME: Some of the materials were inadvertently left off of the barge in Seattle but the project was still complected in time. The weather cooperated for the contractor. 4 COST 4.1 COSTS EXCEEDING ESTIMATES: One change order to cover some bolts that could damage vessels if they were to hit it. This is the item that put us $1,275.00 over budget. We did have a contingency which covered the amount. 4.2 COSTS LOWER THAN ESTIMATES: Harbor staff rebuilding 8 of the docks instead of buying 8 new ones. 4.3 FACTORS AFFECTING COSTS: For the harbor rebuilding the docks we had $23,000.00 in materials and one to two harbor staff rebuilding the docks as time permitted (3 - 8 hour days per dock section 8 total) where as the bids for 8 new dock sections averaged $197,000.00, without this change we could not have completed this project. 5 LESSONS LEARNED 5.1 POSITIVE OR NEGATIVE OUTCOMES: It was nice to have this completed very close to budget (over $1,275.00) even though the Harbor had to rebuild the docks, also we had to remove some of the other items that the engineer designed (concrete planks), it is still a nice improvement to what was located at the North East launch ramp. 6 RECOMMENDATIONS 6.1 RECOMMENDATIONS FOR ACTION: This was the second bid proposal that was sent out the first was not allowed due to two of the three contractors bid was double what was budgeted and the third was under budget but faxed in one document which by the City bid procedures was not allowed or this project could have been accomplished under budget and done during the previous year. 6.2 RECOMMENDATIONS FOR FUTURE PROJECTS: Allow a fax for a change to the bidders price at the last minute, I still agree that the bid should be mailed or hand delivered but to lose out on a low bid by faxing one piece of paper to me the City lost funds on this project by not allowing the lowest bid in the first set of bid proposals. PROJECT COMPLETION REPORT Community Playground Waterfront Erosion 1 PROJECT SUMMARY 1.1 DEPARTMENT INFORMATION: Department: Parks & Recreation POC: K. Sturdy, R. Long Type of Report: Final 1.2 CONTRACT INFORMATION: Contract Number: Purchase Order Number: Contract Type: Fixed Price Award Date: 10/28/2016 Completion Date: 10/31/2016 Award Value: $ 100,000.00 Current/Total Dollar Value: $ 100,000.00 Contingency Value: $ 10,000.00 Change Order Value: 1.3 CONTRACTOR INFORMATION: Contractor Name/Address: Hamilton Marine Construction LLC PO Box 241952 AnrhoraeP AK g9574 p 1.4 KEY SUBCONTRACTORS: Subcontractors Name/City/State: None 1.5 CONTRACT/PROJECT DESCRIPTION: General Scope of Work/Services: Place approx. 1800 cubic yards AKDOT Class -III rip -rap and 12-17" minus aggregate to the specifications in the plan set from R&M Consultants, to conform with USACE permit requirements, and produce final as -built for USACE close out. 1.6 PROFESSIONAL SERVICES -DESIGN: Contract Number: Contract Type: Time & Materia Award Date: W15/2015 Award Value: $ 25,075.72 Contingency Value: 1.7 FIRM INFORMATION: Contractor Name/Address: R&M Consultants, Inc. 9101 Vanguard Dr. Anchorage, AK 99507 Purchase Order Number: Completion Date: 03/05/2016 $ 25,075.72 Current/Total Dollar Value: $ 25,075.72 Change Order Value: 1.8 PROFESSIONAL SERVICES —CONSTRUCTION MANAGEMENT AND INSPECTION: Contract Number: (As -Built) Purchase Order Number: Contract Type: other Award Date: 11/21/2016 Award Value: Contingency Value: Completion Date: 11/23/2016 $ 7,850.00 Current/Total Dollar Value: Change Order Value: 0 $ 7,850.00 1.9 FIRM INFORMATION: Contractor Name/Address: Hamilton Marine, as -built is exclusion from construction fixed price, and is at T&M. 1.10 TOTAL P ROJ ECT COSTS: Design Costs: $ 25,075.72 Construction Costs: $ 100,000.00 CM/Inspection Costs: $ 7,850.00 TOTAL PROJECT COST: $ 132,925.72 2 QUALITY 2.1 BENEFITS ACHIEVED: Further undercutting of bank arrested and previous damage mitigated, Waterfront bike path, Community Playground and Evan Casey Skate Park protected. 2.2 BENEFITS NOT ACHIEVED: 2.3 FACTORS AFFECTING BENEFITS: Good structure north and south of affected area confining damage to ^300' 3 SCHEDULE 3.1 TASKS EXCEEDING TIME: 3.2 TASKS REQUIRING LESS TIME: Funding and construction 3.3 FACTORS AFFECTING TIME: Funding was expedited by a $50,000 award from the Seward Bear Creek Flood Service Area. Construction was expedited by a quantity of machinery and personnel on scene and available coincident with another similar project. 4 COST 4.1 COSTS EXCEEDING ESTIMATES: 4.2 COSTS LOWER THAN ESTIMATES: Construction costs. 4.3 FACTORS AFFECTING COSTS: Substitution of stone size classifications to capture sizes being produced incidental to the breakwater project but not usable for that project lowered the cost of rock production. The fortunate coincidence of having the immediate capacity to haul and place the rock kept construction costs down. Partnership with the SBCFSA lowered the City's total cost share 5 LESSONS LEARNED 5.1 POSITIVE OR NEGATIVE OUTCOMES: 6 RECOMMENDATIONS 6.1 RECOMMENDATIONS FOR ACTION: 6.2 RECOMMENDATIONS FOR FUTURE PROJECTS: Consider annual or biannual project cost contracting bid processes so that when a small project comes up the city can know the unit cost in advance and move the project ahead without the delay of bids/proposals for each project, the competitive procurement having already taken place. Ll Information compiled by the City Clerk at the request of Council Member Altermatt City of Seward Council Meeting December 12, 2016 Policy information addressing council's duties and rules of debate From the Cit►, Council Rules of Procedure: The City Council enacts the laws of the City of Seward, approves the annual budgets of the city, sets city policy and serves as an appeal board for actions taken by city boards and commissions and the city administration. In other words, your function is to serve as the legislative body of the city. The city's administrative functions are carried out by the City Manager. It is sometimes difficult to grasp the difference in these two areas of responsibility. For instance, you are setting policy when you adopt a budget for street plowing. However, it is up to the City Manager and their staff to determine who is going to do the plowing and which streets will be plowed first. (Introduction, Page i) RULE 4. ORGANIZATION OF COUNCIL The City Council must meet and organize not later than 30 days after each regular city election. At this organizational meeting, the Council elects one of its members to act as Vice -Mayor in the absence of the mayor. In addition, the Mayor may appoint the council liaison to the Planning Commission and the council representative to the Kenai Peninsula Borough Economic Development District. [See Rule 29(c) and SCC § 2.10.0201 (Page 1) RULE 5. PRESIDING OFFICER The Mayor presides at all meetings of the Council and is recognized as the head of the City for all ceremonial purposes. The Mayor has no regular administrative or executive duties. In case of the Mayor's absence or temporary disability, the Vice -Mayor acts as Mayor during the continuance of the absence. In case of the absence or temporary disability of the Mayor and the Vice -Mayor, an Acting Mayor selected by members of the Council acts as Mayor during the continuance of the absences or disabilities. The Mayor or Vice -Mayor is referred to as "Presiding Officer" from time to time in these Rules of Procedure. [SCC §2.10.020 and § 2.10-0251(Page 1) (Clerk's Note: Much of the City Council Rules of Procedure address the duties of the City Council, so it is recommended to look through the entire booklet for more information) From the City Charter. Chapter 3. - City Council 3.1. - Composition; powers and duties generally; term of office. The council shall consist of the mayor and six council members. The mayor and each council member shall be elected from the city at large. The term of office of an elective officer shall be two years and shall commence immediately before the council organizes following the officers election. The council shall exercise all of the legislative and policy -making powers of the city and shall provide for the performance of all duties and obligations imposed upon the city by law. (10/04/94, Resolution No. 94-113) 3.2. - Expiration of terms; qualification of appointees to fill vacancies. The terms of three council members shall expire in each year, except that in each second year, counting from 1959, the terms of the mayor and of three council members shall expire. When appointments are made to fill vacancies in the manner provided by section 2.13(a) of this Charter, appointees shall qualify for and assume the duties of office within ten days after appointment, unless such time be extended for not more than sixty days by council. 33. - Organization of council. The council shall meet and organize not later than thirty days after each regular city election. (10/04/94, Resolution No. 94-113) 3.4. - Mayor. (a) The mayor shall possess all powers and shall exercise all duties provided or required of him by law or by the council. (b) He shall be the presiding officer of the council. (c) He shall be a member of the council with all the powers and duties of that office. (d) He shall advise the council concerning the affairs of the city and make recommendations thereon. Information compiled by the City Clerk at the request of Council Member Altermatt City of Seward Council Meeting December 12, 2016 Policy information addressing council's duties and rules of debate (e) He shall make all required appointments subject to prior approval of the council. (f) He shall be ceremonial head and chief officer of the city. (g) He shall not possess the veto power. (10/04/94, Resolution No. 94-114) 3.5. - Meetings of council. (a) The council shall meet in the established council chambers or such other place as may be established in the Code, and shall hold at least two regular meetings in each month; provided that any regular meeting may be canceled by the affirmative vote of at least four council members. In selecting its meeting place, the council shall consider the reasonable accommodation of the public. (b) Special meetings shall be called by the city clerk on the written request of the mayor, the city manager or any two members of the council. The request shall specify the location of the special meeting, which shall be selected with consideration for the reasonable accommodation of the public. (c) At least six hours written notice shall be given designating the time and purpose of a special meeting. Such notice shall be served personally on each member of the council, or left at his usual place of residence or business by the city clerk or by someone designated by him. A copy of such notice shall also be delivered at the place of business of each newspaper printed and published in the city, but this requirement shall not be jurisdictional to the holding of any such meeting. (d) In an emergency, any special meeting shall be a legal meeting if all members are present or, if there be a quorum present, and all absent members having in writing waived the required notice. Waivers may either be before or after the time of meeting. (e) An affidavit of service of any notice required by this section shall be made a part of the journal of a special meeting. All waivers of notice shall be attached and made part of the journal of the meeting. (f) No business shall be transacted at any special meeting of the council, except that stated in the notice of the meeting. (g) All regular and special meetings of the council shall be public meetings and the public shall have a reasonable opportunity to be heard. (h) The council may, after its agenda is otherwise completed, recess for the purpose of discussing, in a closed or executive session, any question permitted by law which is expressed in the motion calling for executive session. The public may be excluded from the session, but final action shall not be taken by the council on any matter discussed in executive session until the matter is placed on the agenda. (i) Four members of the council shall be a quorum for the transaction of business. In the absence of a quorum, any member less than a quorum may adjourn a meeting to a later date. 0) The council shall determine its own rules and order of business and shall keep a journal of all its proceedings. The journal of each meeting of the council shall be signed by the clerk and counter -signed by the mayor. The vote upon all matters considered by the council shall be taken by yes or no votes which shall be entered upon the record, except that, where the vote is unanimous, it shall only be necessary to so state. (k) The council may compel attendance at its meetings of any officers or employees of the city. It may punish for non-attendance in such manner as it may prescribe in the Code. (1) No member of the council may vote on any question upon which he has a substantial direct or indirect financial interest. Otherwise, each member of the council shall vote on each question before the council for a determination, unless excused therefrom by the affirmative vote of all remaining members able to vote on the question. If a question is raised under this section at any council meeting, such question shall be determined before the main question shall be voted on, but the council member affected may not vote on such determination. (m) The vote of at least four members shall be required for official action by the council, unless a larger majority is required by law. (10/04/94, Resolution No. 94-115) 3.6. - Powers of council to appoint citizen boards. (a) The council may in its discretion by ordinance create or abolish boards or may grant to them the power to conduct hearings, to make recommendations and initial decisions which, unless appealed within ten days, shall become final. The council shall provide for appeals by any party affected by the proceedings or by city administration officers and shall direct that all decisions must be promptly filed with the city clerk as public record. (b) Unless the council shall otherwise determine by a majority vote, all questions presented to the council concerning any subject which has been delegated to a citizen board shall be submitted to the board for consideration. K a Information compiled by the City Clerk at the request of Council Member Altermatt City of Seward Council Meeting December 12, 2016 Policy information addressing council's duties and rules of debate (c) Boards established by the council shall not be authorized to employ or direct the employment or removal of any administration officer or employee of the city. (10/01/85, Resolution No. 85-89, § 1; 10/04/94, Resolution No. 94-116; 7/28/97, Resolution No. 97-111, § 1) 3.7. - Restrictions of power of council. The council and its members shall not direct the appointment or removal of any administration officer or employee of the city and shall deal with the administrative service of the city through the city manager only. (10/04/94, Resolution No. 94-117) From the Seward City Code. Chapter 2.10. - City Council 2.10.015. - Election of mayor and council.[61 The mayor shall be elected by direct vote of the qualified electors biannually in odd number years at the general municipal election held on the first Tuesday of October of said year, for a term of two years, holding office until his term has expired and his successor is elected and qualified. At the general election there shall also be elected annually three members of the city council, each to serve for a term of two years. 2.10.020. - Organization of council; election of vice -mayor. (a) The city council shall meet and organize not later than thirty days after each regular city election. (b) At its organizational meeting, the council shall elect one of its members to act as vice mayor in the absence of the mayor and the mayor shall make all appointments as required of him. 2.10.025. - Duties of mayor, vice -mayor, acting mayor.171 (a) Mayor. The mayor shall possess all powers and shall exercise all duties required of him by law or the city council. He shall be presiding officer of the council. He shall be a member of the council with all powers and duties of that office. (b) Vice -mayor. In the absence of the mayor, the vice -mayor shall possess all the powers of the mayor. He shall possess all duties provided for or required of him by law or the city council. (c) Acting mayor. In the absence of the mayor and the vice -mayor, and if a quorum shall be present, the council shall choose one of its members acting mayor for that session or until the appearance of the mayor or vice - mayor. He shall possess all duties provided for or required of him by law or the city council. 2.10.030. - Meetings.[81 (a) Open meetings. All regular and special meetings of the city council shall be public meetings and the public shall have reasonable opportunity to be heard. (1) Regular meetings. Regular meetings of the city council shall be held in the council chambers in the Seward City Hall, or at such other place as may be determined by the city council upon consideration of the reasonable accommodation of the public. Regular city council meetings shall be held on the second and fourth Mondays of each month at 7:00 p.m.; provided that any regular meeting may be canceled by the affirmative vote of at least four councihnembers. (2) Special meetings. Special meetings may be called by the city clerk on written request of the mayor, city manager or of any two members of the city council. Upon request being received, the city clerk shall give due and proper notice as required by section 2.10.032 of this Code. No business shall be transacted at any special meeting of the council except that stated in the notice of meeting. Special meetings shall be held at the regular meeting place of the council or at such other place as may be specified in the meeting notice. The location of the special meeting shall be selected with consideration for the reasonable accommodation of the public. (3) Emergency meetings. In an emergency, any special meeting shall be a legal meeting if all members are present or if there be a quorum present and all absent members have waived, in writing, the required notice requirements of section 2.10.032. Waivers may be before or after the time of the meeting. (4) Work sessions. Upon written request of the mayor, city manager, or any two members of the city council, council may hold work sessions for the purposes of planning, studying and discussing any question permitted by law. No formal action shall be taken by the council on any matters discussed in the work session until the matter is placed on the council agenda. Work sessions shall generally be held in the regular meeting place of the city council; however, the council may designate any other location provided that consideration is given to the reasonable accommodation of the public. i Information compiled by the City Clerk at the request of Council Member Altermatt City of Seward Council Meeting December 12, 2016 Policy information addressing council's duties and rules of debate (b) Executive sessions. [9] Council may, after its agenda is otherwise completed, recess for the purpose of discussing in closed or executive session, any question permitted by law which is expressed in a motion calling for the executive session. Those matters which may be discussed in an executive session are: (1) Matters, the immediate knowledge of which would clearly have an adverse effect upon the finances of the city; (2) Subjects that tend to prejudice the reputation and character of any person, provided the person may request a public discussion; (3) Matters pertaining to threatened or pending litigation; (4) Strategy for the negotiation of labor and other contracts; and (5) Matters, which by law, municipal charter, or ordinance are required to be confidential. The public may be excluded from an executive session but final action shall not be taken by the council on any matter discussed in an executive session until the matter is placed on the agenda of a public meeting. (c) Recessed meetings. The council may recess any of its regular or special sessions to a time not beyond the next regular meeting; and the city clerk shall publish the time and date to which recessed in the best manner. Footnotes: --- (8) --- See charter § 3.4 as to city council meetings; see AS 29.20.020 and AS 44.62.310 for state requirement that meetings be public and AS 44.62.312 for state policy regarding open meetings. --- (9) --- See charter § 3.5(h) for provisions on council executive sessions. 2.10.035. - Voting —Sequence, procedure, conflicts of interest.[10] (a) The voting sequence of the council shall be alternated for each meeting by the city clerk. (b) Any vote of the council may be by voice vote upon demand of any member, either prior or subsequent to any vote. Such vote shall be by roll call. Each member shall answer by the word "yes" or "no." The vote of any member who is present at a meeting and who refuses or fails to cast a vote on a matter upon which he is qualified to vote shall be cast on the side receiving the greatest number of votes. In the event of a tie vote, a vote so cast shall be cast as a "no" vote. (c) No member of the council may discuss or vote on any question in which the member has a direct or indirect substantial financial interest. Direct or indirect financial interest shall be disclosed to the presiding officer prior to the beginning of debate on the question for a ruling on a request from the member with the financial interest to be excused from the discussion and vote. The decision of the presiding officer on a request by a member of the city council to be excused from discussion and a vote may be overridden by the majority vote of the council. If there are not at least four councilmembers in attendance who are qualified to vote, the matter shall be tabled until the next regular or special meeting at which four councilmembers qualified to vote on the matter are in attendance. (d) A municipal employee or official, other than a member of the city council, may not participate in an official action in which the employee or official has a substantial financial interest. Footnotes: --- (10) --- See charter § 3.5(1) for provisions regarding voting and conflict of interest; see AS 29.20.010 for state provisions requiring the adoption of a municipal conflict of interest ordinance; see also § 2.01.020. 2.10.040. - Quorum—Majority.[111 (a) Four members of the city council shall be a quorum for the transaction of business. In the absence of a quorum, any number less than a quorum may adjourn a meeting to a later date. (b) The vote of at least four members shall be required for official action by the council, unless a larger majority is required by law. Footnotes: --- (11) --- See charter § 3.05(m) for provisions on council quorum. 2.10.045. - Methods of action. Legislative action shall be taken by the council only by means of an ordinance or resolution (see also § 2.15.010). Information compiled by the City Clerk at the request of Council Member Altermatt City of Seward Council Meeting December 12, 2016 Policy information addressing council's duties and rules of debate 2.10.065. - Rules of debate. (a) Robert's Rules of Order. Robert's Rules of Order shall be used as the authority on all questions of parliamentary law. These rules may be amended or altered or new rules adopted by the vote of council at any meeting of council. The clerk is designated the parliamentarian for the council and the ciWs boards and commissions. (b) Presiding officer may debate and vote. The presiding officer may move, second and debate from the chair, subject only to such limitations of debate as are by these rules imposed on all councilmembers, and shall not be deprived of any of the rights and privileges of a councilmember by reason of his acting as presiding officer. (c) Getting the floor; improper references to be avoided. Every councilmember desiring to speak shall address the chair, and upon recognition by the presiding officer, shall confine himself to the question under debate, avoiding all improper language and references to personalities. (d) Interruptions. A councilmember, once recognized, shall not be interrupted in speaking unless it be to call him to order or as herein otherwise provided. If a councilmember, while speaking, is called to order he shall cease speaking until the question of order be determined and, if in order, he shall be permitted to proceed. (e) Reconsideration. A motion to reconsider may be applied to any ordinance, resolution or action of the council and has precedence over all motions except the motion to adjourn. (1) A councilmember may make a motion to reconsider only if: a. The councilmember voted on the prevailing side on the question to be reconsidered; b. The councilmember makes the motion to reconsider on the same day and at the same meeting at which the vote to be reconsidered was taken; or C. The councilmember files with the clerk not later than 5:00 p.m. on the first city business day following the day on which the vote was taken a notice of intent to reconsider and then makes the motion to reconsider at the next regular council meeting. The councilmember may file by telephone provided that the notice of intent to reconsider is signed before the motion is considered. (2) A motion for reconsideration requires a two-thirds vote to carry. (3) For the purposes of this section, a council meeting which is recessed and reconvened on a different day shall constitute one meeting. The reconvened session of such a meeting shall not constitute the next regular council meeting as that term is used in this section. (4) Only one motion to reconsider shall be entertained on any ordinance, resolution or other action even if the council overturns the original action. If a motion to reconsider a particular ordinance, resolution or other action fails, a second motion to reconsider the same action shall not be in order. (5) Actions which may not be reconsidered. The following motions may not be reconsidered: a. A motion which can be renewed within a reasonable time; b. An affirmative vote whose provisions have been partly carried out; C. An affirmative vote in the nature of a contract when the party to the contract has been notified of the outcome; d. Any vote which has caused something to be done which it is impossible to undo; e. A vote on a motion to reconsider; or f. When practically the same result can be obtained by some other parliamentary motion. 2.10.075. - Decorum. (a) By councilmembers. When the council is in session, the councilmembers must preserve order and decorum and no councilmember shall, by conversation or otherwise, delay or interrupt the proceedings or the peace of the council, nor disturb any councilmember while speaking, nor refuse to obey the orders of the council or the person presiding. (b) By other persons. Any person making personal, impertinent, threatening or slanderous remarks, or who shall become boisterous while addressing the council, shall be forthwith, by the presiding officer, barred from further audience at the meeting before the council, unless permission to continue be granted by a majority vote of the council. (c) Enforcement. The chief of police shall be ex officio sergeant -at -arms of the council. He shall carry out all orders and instructions given him by the presiding officer for the purpose of maintaining order and decorum in the council chambers. Any person in the audience who uses loud, boisterous or profane language at a council meeting, or language tending to bring the council or any councilmember into contempt, or any person who persistently interrupts the proceedings of the council or refuses to keep quiet or take a seat when ordered to do so by the E l . 7 Information compiled by the City Clerk at the request of Council Member Altermatt City of Seward Council Meeting December 12, 2016 Policy information addressing council's duties and rules of debate presiding officer, shall be deemed guilty of a misdemeanor. Upon instruction from the presiding officer, it shall be the duty of any police officer present to eject any person from the council chambers, or place him under arrest, or both. 2.10.080. - Council as board of adjustments. The city council is designated to be the board of adjustments for the city. The mayor shall act as chairman. (Ord. 482, § l(part), 1980) 2.10.090. - Interference in administrative service prohibited.113] None of the city council, nor any of its committees or members, shall direct, request or attempt to influence, either directly or indirectly, the appointment of any person to office or employment by the city manager, nor in any manner interfere with the city manager to prevent him from exercising his own judgment in the appointment of officers and employees in the administrative service. The council and its members shall deal with the administrative service solely through the city manager and neither the council nor any member thereof shall give orders to any of the subordinates of the city manager, either publicly or privately. Footnotes: --- (13) --- See charter § 3.7 as to the power of council to deal directly with the administrative service. Rules of Debate. continued: 2.10.065. - Rules of debate. (a) Robert's Rules of Order. Robert's Rules of Order shall be used as the authority on all questions of parliamentary law. These rules may be amended or altered or new rules adopted by the vote of council at any meeting of council. The clerk is designated the parliamentarian for the council and the city's boards and commissions. (b) Presiding officer may debate and vote. The presiding officer may move, second and debate from the chair, subject only to such limitations of debate as are by these rules imposed on all councilmembers, and shall not be deprived of any of the rights and privileges of a councilmember by reason of his acting as presiding officer. (c) Getting the floor; improper references to be avoided. Every councilmember desiring to speak shall address the chair, and upon recognition by the presiding officer, shall confine himself to the question under debate, avoiding all improper language and references to personalities. (d) Interruptions. A councilmember, once recognized, shall not be interrupted in speaking unless it be to call him to order or as herein otherwise provided. If a councilmember, while speaking, is called to order he shall cease speaking until the question of order be determined and, if in order, he shall be permitted to proceed. Regarding speaking time, Robert's Rules states to save time, no member may speak more than two times on any one motion in any one day, and each of those speeches is limited to 10 minutes. From the Complete Idiot's Guide to Robert's Rules: The basis of this rule is that, in the democratic process, everyone should be able to participate in the debate. If one member dominates the debate, that reduces the rights of the other members. In small groups, there is no limit to the number of times a member may speak. Other rules of parliamentary etiquette: Only speak when called on Direct all comments to the chair Don't be disruptive You can (politely) make corrections The chair can interrupt you C• 2016 Kenai Peninsula Situat41 ions and Pros ec S P t 10*'.. je ' !- t • i lip .' ir ' '.� � ' ' � sir �.i� ,� 1• •* _�""- � ��. L � ta i � � I eJ ��-- KENAI PENINSULA ECONOMIC DEVELOPMENT DISTRICT N. or AL �! '{ PAN w - i 1�iCRy��1 Wo "11 y -'.` 2` F r • i� t c 7 t w "Leadership to Enhance, Foster, and r 11 Tom.0te". conomicDevelopwent ` ' y 4104 1 N1, 41, 07 T Y t lY , � r. _� ,rr.. c //R � / � . ' }f} - a '� i • E � •'� a q l_ ♦ _ 1. � � w �}{era � - - } • ° r• I • .- 1 .» .YY y• h } 4+ a 1 n , ry • _ M •. 1" °f�. _ A � � r .�� y + + .. 1 • - k. 6 � ,l„' P`' � • � " �'' i • ` sf } r » h d y Ma 2016 Y_% ' � � " � �i sl r, • A � � � • _.'a�+ ,j�.`il�' � �* • 1 . r , - � N .� 1 , {. ��1 ` �� � ti y L r�q� : \�. � I ,fir i, 9 'y�i! � ■/ .iYr � �� it � � ,� ' , � � ."� ` • a' "� a °IY•yr +,�'- `Y . a. , _I .. �� � _ - 4 I l �! , K� _ � �'. � ,4. {, '�� 4� y..� , at . ,.� 'l . 7 � " wiyf + � . I � � ' y i • , 3 � ��_ �. 1 ' - 4Ii. da 4J+ � � ' � i �I�r �Iy� ��`s"yi� , i. ,. ,� . i�` ,Y.". r.'. � , T � • i�=~+��,• ''�. .* - �.,. - i. � _ r�� do • 4 R 1 `• • LraAinbip ro inlw.ue. fo,rrr anA promorr rronnmir Amalapmrnr INDUSTRY OUTLOOK FORUM HOSTED BY -1 to L-O)do w+I Kenai Peninsula Economic Development District And Supported By City of Kenai, City of Soldotna, And Chambers of Commerce of Kenai, Soldotna, Seward and Homer Wednesday, January 111h, 2017 8:30 Registration & Coffee 9:00 Welcome - Tim Dillon Pledge of Allegiance Borough Update: 9:05 Mayor Mike Navarre (Confirmed) Kenai Peninsula Borough Economic Overview: Alaska State 9:45 Alyssa Shanks Rodrigues, Economist III (Confirmed) Alaska Department of Labor and Workforce Development Local Entrepreneur: 10:30 Pamela Parker, Owner (Confirmed) Everything Bagels 10:55 Networking Break Door Prize Workforce Outlook Panel - Opportunities and Training Rachel O'Brien, Alaska Dept. Labor (Confirmed) Gary Turner, Kenai Peninsula College (Confirmed) 11:10 Sean Dusek, Kenai Peninsula Borough School District (Confirmed) Bob Hammer, Kenai Peninsula Construction Academy (Confirmed) Cathy LeCompte, AVTEC (Confirmed) Page 1 of 2 Lunch Speaker - Alaska LNG Update from Keith Meyer (Confirmed) 12:00 Alaska Gasline Development Corporation Tourism Update Sarah Leonard, President & CEO (Confirmed) 1:15 Alaska Travel Industry Assoc. Shanon Davis, Executive Director (Confirmed) Kenai Peninsula Tourism Industry Local Entrepreneur: 2:00 Jack Bennett (Confirmed) Arctic Green Response Technologies Deborah Nyquist, Wellness Director (Confirmed) 2:20 Kenaitze Indian Tribe Health Update: 2:40 Rick Ross, Borough Health Task Force Chair (Confirmed) Peninsula -Wide Update Entrepreneur: 3:05 Ellen Adlam, Owner (Confirmed) Blue Moose Bed & Biscuit 3:20 Networking Break Door Prize Deantha Crockett, Executive Director (Confirmed) 3.'30 Alaska Miners Assoc. Fishing Update: Brandii Holmdahl, Assembly Member (Confirmed) 3:55 Kenai Peninsula Borough 4:25 Kara Moriarty, President & COO (Confirmed) Alaska Oil & Gas Association 4:55 Reception & Cocktails Dinner Speaker - Economic Impacts of Climate Change 5:25 Mead Treadwell, Past Lt. Governor (Invited) Former Chair of U.S. Arctic Research Commission 7:00 Wrap Up / End of Day Page 2 of 2 Kenai Peninsula Average Monthly Jobs by Industry January - June (categories shown if all 4 quarters data available) Prepared for KPEDD by Sheinberg Associates, Dec 2016 TOTAL ALL INDUSTRIES 40,271 39,306 -965 -2.4% TOTAL PRIVATE 30,283 29,256 -1,027 -3.4% NATURAL RESOURCES AND MINING 2,287 1,877 -410 -17.9% Agriculture, Forestry, Fishing, Hunting 145 170 25 17.2% Fishing, Hunting, Trapping 38 64 26 68.4% Mining 2,142 1,707 -435 -20.3% Oil and Gas Extraction 670 299 -371 -55.4% CONSTRUCTION 1,870 1,859 -11 -0.6% Construction of Buildings 543 516 -27 -5.0% Heavy Construction 251 420 169 67.3% Specialty Trade Contractors 1,078 923 -155 -14.4% MANUFACTURING 1,609 1,582 -27 -1.7% Food 667 700 33 4.9% Beverage and Tobacco Products 40 44 4 10.0% Transportation Equipment 176 147 -29 -16.5% TRADE, TRANSPORTATION AND UTILITIES 7,904 7,806 -98 -1.2% Wholesale Trade 442 397 -45 -10.2% Wholesale, Durable Goods 228 194 -34 -14.9% Wholesale, Nondurable Goods 176 172 -4 -2.3% Wholesale, Electronic Markets 38 31 -7 -18.4% Retail Trade 5,229 5,298 69 1.3% Motor Vehicle and Parts Dealers 551 508 -43 -7.8% Furniture and Home Furnishings 80 100 20 25.0% Electronics and Appliances 104 107 3 2.9% Building Material and Garden 649 682 33 5.1% Food and Beverages 1,205 1,216 11 0.9% Health and Personal Care 198 234 36 18.2% Gasoline Stations 312 239 -73 -23.4% Clothing and Clothing Accessories 99 124 25 25.3% Sporting Goods, Books, Music, etc. 272 272 0 0.0% General Merchandise 1,328 1,367 39 2.9% Miscellaneous 243 269 26 10.7% Non -store Retailers 185 180 -5 -2.7% Transportation and Warehousing 1,751 1,654 -97 -5.5% Air Transportation 330 325 -5 -1.5% Water Transportation 230 176 -54 -23.5% Truck Transportation 257 247 -10 -3.9% Scenic and Sightseeing 302 293 -9 -3.0% Support Activities 283 258 -25 -8.8% Couriers and Messengers 71 81 10 14.1% Utilities 481 457 -24 -5.0% Utilities 481 457 -24 -5.0% 2015 2016 Change Percent INFORMATION 474 475 1 0.2% Motion Picture and Sound Recording 62 63 1 1.6% Broadcasting, except Internet 94 90 -4 -4.3% Telecommunications 203 221 18 8.9% Other Information Services 10 12 2 20.0% FINANCIAL ACTIVITIES 1,207 1,245 38 3.1% Finance and Insurance 563 590 27 4.8% Credit Intermediation, etc. 376 391 15 4.0% Securities, Investments 47 54 7 14.9% Insurance Carriers 139 144 5 3.6% Real Estate, Rental and Leasing 644 655 it 1.7% Real Estate 234 234 0 0.0% Rental and Leasing Svcs. 410 421 11 2.7% PROFESSIONAL AND BUSINESS SERVICES 1,693 1,384 -309 -18.3% Professional, Scientific, Tech. 1,161 928 -233 -20.1% Professional, Scientific, Tech. 1,161 928 -233 -20.1% Mgmt. of Companies & Enterprises 62 59 -3 -4.8% Mgmt. of Companies and Enterprises 62 59 -3 -4.8% Administrative and Waste Services 470 396 -74 -15.7% Administrative and Support Services 382 319 -63 -16.5% Waste Management/Remediation 87 77 -10 -11.5% EDUCATIONAL AND HEALTH SERVICES 6,712 6,598 -114 -1.7% Educational Services 254 222 -32 -12.6% Educational Services 254 222 -32 -12.6% Health Care and Social Assistance 6,459 6,376 -83 -1.3% Out Patient Health Care 2,435 2,331 -104 -4.3% Social Assistance 1,537 1,416 -121 -7.9% LEISURE AND HOSPITALITY 4,708 4,786 78 1.7% Arts, Entertainment and Recreation 484 476 -8 -1.7% Amusements, Gambling, Recreation 412 413 1 0.2% Accommodation and Food Services 4,224 4,310 86 2.0% Accommodation 1,453 1,542 89 6.1% Food Services and Drinking Places 2,771 2,769 -2 -0.1% OTHER SERVICES 1,783 1,554 -229 -12.8% Repair and Maintenance 417 392 -25 -6.0% Personal and Laundry 287 280 -7 -2.4% Membership Organizations, etc. 1,044 848 -196 -18.8% Private Households 35 34 -1 -2.9% UNCLASSIFIED ESTABLISHMENTS 38 91 53 139.5% TOTAL GOVERNMENT 9,988 10,050 62 0.6% Federal 683 676 -7 -1.0% State 2,522 2,487 -35 -1.4% Local (Cities incld some hospital, Boro, Schools, Tribal) 6,783 6,887 104 1.5% Source: Alaska Department of Labor and Workforce Development, Research and Analysis Section, Quarterly Census of Employment and Wages Research, analysis, and the 2016 Situations & Prospects Report by Sheinberg Associates, a Community & Strategic Planning & Research firm, www.SheinbergAssociates.com GIS analysis and corresponding map production by Alaska Map Company www.akmapco.com Kenai Peninsula icons by graphic artist Averyl Veliz averylveliz. blogspot. com Cover photo by Barbara Sheinberg. Many photographs contributed by Peninsula Clarion, as noted in captions. May 2016 Dear Readers, Leadership to enhance, foster, and promote economic development The Kenai Peninsula Economic Development District, Inc. (KPEDD) is very pleased to issue the 2016 Situations and Prospects. We heard from many of you that you found last year's report quite valuable for your business, agency, or non -profit's decision -making. In the 2016 Situations & Prospects you will find a complete 2015 dataset for most information, making this the most current and comprehensive review of the Kenai Peninsula's economy and relevant metrics available. KPEDD's mission is to provide leadership in enhancing, fostering, and promoting responsible and sustainable economic development. In order to achieve this goal KPEDD has adopted the acronym of SAVE - Sustainable, Accountable, Visible, and Efficient. We hope you find the 2016 Situations and Prospects report will SAVE you time and help with your business decisions. It is available to download at our website at www.kyedd.org. If you have not visited the KPEDD website lately you will be surprised. We have economic data and indicators available in an easy -to -use platform there for your use. Stay in touch --- come by our office at mile 14.5 on the Kenai Spur Highway, give us a call at 283-3335, or email Rick anytime at rroeske@kpedd.oEg to see how we can assist you in meeting your business needs. Brendyn Shiflea President, Board of Directors Brendyn Shiflea, President Todd Smith, Vice President Rachel O'Brien, Treasurer Stephanie Queen, Secretary Dale Bagley Dale Butts Rick A. Roeske Executive Director Mike Dye Brandii Holmdahl Rick Koch Stan Mishin Joe Rybak Julie Woodworth Bryan Zak Acronym Guide AADT Average Annual Daily Traffic ACS American Community Survey ADEED Alaska Department of Education and Early Development ADF&G Alaska Department of Fish and Game ADOLWD Alaska Department of Labor and Workforce Development ADOR Alaska Department of Revenue ADOT&PF Alaska Department of Transportation and Public Facilities AHFC Alaska Housing Finance Corporation AIDEA Alaska Industrial Development & Export Authority AMHS Alaska Marine Highway System AVTEC Alaska Vocational Technical Center BEA Bureau of Economic Analysis BRE Business, Retention and Expansion CAH Critical Access Hospital CDP Census Designated Place CDQ Community Development Quota CFEC Commercial Fisheries Entry Commission CI Cook Inlet CMS Centers for Medicare and Medicaid Services CPH Central Peninsula General Hospital DCCED Department of Commerce and Community Economic Development DCRA Division of Community and Regional Affairs EIS Environmental Impact Statement FAA Federal Aviation Administration FERC Federal Energy Regulatory Commission IFQ Individual Fishing Quota KPB Kenai Peninsula Borough KPC Kenai Peninsula College KPEDD Kenai Peninsula Economic Development District KPTMC Kenai Peninsula Tourism and Marketing Council LNG Liquid Natural Gas NAICS North American Industry Classification System NOAA National Oceanic and Atmospheric Administration NRCS Natural Resources Conservation Service ODB Occupational DataBase OCS Outer Continental Shelf PFD Permanent Fund Dividend Pre -FEED Pre -Front End Engineering and Design PK-12 Preschool through 121h Grade QCEW Quarterly Census of Employment and Wages SNAP Supplemental Nutrition Assistance Program SPH South Peninsula Hospital TAG Tax Authority Group UAF University of Alaska Fairbanks USCG United States Coast Guard USDA United States Department of Agriculture Table of Contents 1 Kenai Peninsula at a Glance and Executive Summary.......................................................................................................1 2 Demographics............................................................................................................................................................................7 2.1 Overall Population..............................................................................................................................................................7 2.2 Population Projection including Age Distribution.........................................................................................................9 3 Education...................................................................................................................................................................................10 3.1 Kenai Peninsula Borough School District......................................................................................................................11 3.2 Postsecondary Schools......................................................................................................................................................14 4 Housing.....................................................................................................................................................................................15 5 Cost of Living...........................................................................................................................................................................17 6 Building Construction and Assessed Property Value......................................................................................................20 6.1 Built Space Added or Improved......................................................................................................................................20 6.2 Property Assessments and Taxes....................................................................................................................................21 6.3 Properties with Highest Assessed Value.......................................................................................................................22 7 Road, Air, and Marine Travel and Freight..........................................................................................................................24 7.1 Road Travel (Average Annual Daily Traffic AADT)....................................................................................................24 7.2 Alaska Marine Highway System.....................................................................................................................................27 7.3 Marine Cargo.....................................................................................................................................................................28 7.4 Air Access...........................................................................................................................................................................29 8 Regional and Personal Prosperity ........................................................................................................................................31 8.1 Total Personal Income.......................................................................................................................................................31 8.2 Sources of Total Personal Income....................................................................................................................................32 8.3 Per Capita and Household Income.................................................................................................................................33 8.4 Poverty Indicators.............................................................................................................................................................34 9 Business Prosperity.................................................................................................................................................................35 9.1 Innovation and Entrepreneurship -Profiles on the Kenai Peninsula........................................................................35 9.2 The Whole Work Economy (Employment + Self -Employed Business Owners) ..............................................................36 9.3 A Deeper Look at 2015 Employment and Wages on the Peninsula...........................................................................39 9.4 Resident -Nonresident Workforce...................................................................................................................................41 9.5 Kenai Peninsula Business Activity (Taxable and Gross Sales)....................................................................................42 9.6 Number of Businesses.......................................................................................................................................................46 10 KPB Economy: Industry Spotlights....................................................................................................................................47 10.1 Oil &Gas Industry..........................................................................................................................................................47 10.2 Kenai Peninsula Maritime Work...................................................................................................................................51 10.3 Commercial Fishing and Seafood Processing..............................................................................................................55 10.4 Tourism and Visitors.......................................................................................................................................................65 10.5 Health Care and Social Assistance................................................................................................................................73 11 Borough and City Profiles....................................................................................................................................................79 11.1 Kenai Peninsula Borough...............................................................................................................................................79 11.2 City of Homer..................................................................................................................................................................81 11.3 City of Kenai.....................................................................................................................................................................84 11.4 City of Seldovia................................................................................................................................................................87 11.5 City of Seward..................................................................................................................................................................89 11.6 City of Soldotna...............................................................................................................................................................92 List of Figures Figure 1 - Population Indicators, Kenai Peninsula Borough............................................................................................................. 7 Figure 2 - Population Growth, Kenai Peninsula Borough................................................................................................................. 7 Figure3 - Population by Place, 2011-2015........................................................................................................................................... 8 Figure 4 - Components of Population Change, Kenai Peninsula Borough..................................................................................... 9 Figure6 - Kenai Peninsula Population, 2015....................................................................................................................................... 9 Figure 6 - Projected Kenai Peninsula Population, 2045.....................................................................................................................9 Figure7 - Population, Past and Projected,.........................................................................................................................................10 Figure 8 - Total Enrollment, by School and Community (PK-12)..................................................................................................12 Figure 9 - Kenai Peninsula Borough School District........................................................................................................................13 Figure10 - SAT and ACT Test Scores................................................................................................................................................14 Figure 11 - AVTEC and Kenai Peninsula College, Number of Enrolled Students.......................................................................14 Figure 12 - Average Home Price, Kenai Peninsula Borough.........................................................................................................15 Figure 13 - Number of New Dwelling Units Constructed..............................................................................................................16 Figure 14 - 2015 Household Expenses, Select Alaskan Communities...........................................................................................17 Figure 15 - 2015 Housing Costs, Select Alaskan Boroughs/Census Areas....................................................................................18 Figure 16 - 2015 Average Sale Price - Single Family Homes...........................................................................................................18 Figure17 - Residential Construction Costs.......................................................................................................................................19 Figure 18 - Building Development by Place, 2010-2015, total square feet.....................................................................................20 Figure 19 - Example Mill Rates within Kenai Peninsula Borough................................................................................................. 21 Figure 20 - Assessed Taxable Value of Property and Tax Revenue, by Place...............................................................................21 Figure21 - Top 20 Property Tax Payers............................................................................................................................................. 22 Figure 22 - Average Annual Daily Traffic, Select Kenai Peninsula Locations.............................................................................. 25 Figure 23 - Number of Port Departures, Alaska Marine Highway System.................................................................................. 27 Figure 24 - Number of Disembarking (arriving) Passengers, Alaska Marine Highway System...............................................27 Figure 25 - Coal, Metric Tons Delivered to Seward.........................................................................................................................28 Figure 26 - Port of Seward Cargo Traffic, Short Tons...................................................................................................................... 28 Figure 27 - Arriving (Deplaning) Air Passengers/Freight on the Kenai Peninsula...................................................................... 30 Figure 28 - Total Personal Income, Kenai Peninsula - Actual and Inflation Adjusted (2014 dollars) ....................................... 31 Figure 29 - Sources of Kenai Peninsula Resident Income, 2014...................................................................................................... 32 Figure 30 - Change in Sources of Personal Income, Kenai Peninsula Residents.......................................................................... 32 Figure 31 - Per Capita Income, 2013 and 2014 (and percent change)............................................................................................. 33 Figure 32 - Number of Households by Median Income Level........................................................................................................ 33 Figure 33 - Economic Hardship Indictators, Kenai Peninsula........................................................................................................ 34 Figure 34 - Number (and %) of Students Qualifying for................................................................................................................. 34 Figure 35 - Workforce and Earnings Summary, Kenai Peninsula.................................................................................................. 36 Figure 36 - Sources of All Work Income (employment + self-employed)..................................................................................... 37 Figure 37 - Full Workforce (employment + self-employed)........................................................................................................... 37 Figure 38 - Number of Jobs — Top 5 Sectors (Employees + Self-employed).................................................................................. 38 Figure 39 - Total Work Earnings — Top 5 Sectors (Wages + Earnings of Self-employed).................................................................. 38 Figure 40 - 2015 Average Monthly Employment and Wages by Industry, Kenai Peninsula..................................................... 39 Figure 41 - Kenai Peninsula 5-Year Change in Employment (2011-2015) and 2015 Monthly Wages.......................................40 Figure 42 - Worker Residency by Borough or Census Area, 2014.................................................................................................. 41 Figure 43 - Taxable Sales by Type of Business, Kenai Peninsula Borough, by Year.................................................................... 43 Figure 44 - Business Activity - Gross Sales by Type of Business, Kenai Peninsula Borough, by Year ...................................... 44 Figure 45 - 2015 Gross Sales by City and Recent Change................................................................................................................ 45 Figure 46 - Gross Business Sales ($millions), by City, 2006-2015...................................................................................................45 Figure 47 - Number of State of Alaska Business Licenses with Establishments..........................................................................46 Figure 48 - Oil & Gas Employment and Total Wages, Kenai Peninsula, 2007-2015....................................................................48 Figure 49 - Kenai Peninsula Borough Gross and Taxable Sales Activity, Oil and Gas Businesses............................................49 Figure 50 - Kenai Peninsula Maritime Workforce by Type of Work, 2014....................................................................................51 Figure 51 - Kenai Peninsula Region Maritime Employment and Earnings, 2013 and 2014........................................................53 Figure 52 - Commercial Fishing Vessels, Kenai Peninsula Borough.............................................................................................54 Figure 53 - Value of KPB Resident's 2014 Harvest, Measured by Estimated Gross Earnings .................................................... 55 Figure 54 - Kenai Peninsula Resident Commercial Fishing Activity, 2014...................................................................................56 Figure 55 - KPB Resident Permit and Fishing Activity, by Year (all fisheries, all areas, all permits) ........................................ 57 Figure 56 - Amount of State Fisheries Taxes Shared with KPB and Cities................................................................................... 58 Figure 57 - Commercial Fishing and Seafood Processing in Kenai Peninsula Borough.............................................................58 Figure 58 - Gross Earnings Cook Inlet Drift and Set Gillnet Salmon Fisheries, 2014.................................................................. 60 Figure 59 - Average price per pound for Cook Inlet Salmon.......................................................................................................... 60 Figure 60 - Cook Inlet Salmon Harvests and Ex -vessel Prices, by Species, 2006-2015,............................................................... 61 Figure 61 - Commercial Halibut Harvest Landed in KPB (in pounds), and................................................................................. 62 Figure 62 - Commercial Catch of Pacific Sablefish in KPB (pounds)........................................................................................... 63 Figure 63 - Gross Sales for Visitor Related Businesses in the Kenai Peninsula Borough............................................................ 65 Figure 64 - Gross Sales, Visitor Related Businesses, Kenai Peninsula, 2009-2015........................................................................ 66 Figure 65 - Visitor Industry Employment and Wages..................................................................................................................... 66 Figure 66 - State's Commercial Passenger Vessel (CPV) Tax.......................................................................................................... 67 Figure 67 - Cruise Ship Passengers on the Kenai Peninsula........................................................................................................... 68 Figure 68 - Alaska Railroad Passengers in Seward.......................................................................................................................... 68 Figure 69 - Annual Visitors to KPB Destinations.............................................................................................................................. 69 Figure 70 - Gross Business Sales from Guided Land and Water Activities.................................................................................. 70 Figure 71 - Sport Fishing Days Fished, by Type, 2010-2014............................................................................................................ 70 Figure 72 - Kenai Peninsula and East Cook Inlet Sport Fishing, Number of Anglers by Type, 2010-2014 .............................. 71 Figure 73 - Number of Guided and Nonguided Anglers on the Kenai River, 2004-2014........................................................... 71 Figure 74 - Number of Guided and Nonguided Anglers on the Kenai River, 2014.................................................................... 72 Figure 75 - Kenai Peninsula - Health Care & Social Services, Employment & Wages, 2006-2015............................................. 73 Figure76 - Health Care & Social Assistance..................................................................................................................................... 74 Figure 77 - Business Activity - Gross Sales for Health Care & Social Assistance......................................................................... 74 Figure 78 - Health Care Occupations with at Least 25 Workers, on Kenai Peninsula, 2014....................................................... 75 Figure 79 - Health Coverage by Type, Kenai Peninsula.................................................................................................................. 75 Figure 80 - Socioeconomic Profile, Kenai Peninsula Borough........................................................................................................ 79 Figure 81 - Kenai Peninsula Borough Tax Revenue......................................................................................................................... 80 Figure 82 - City of Homer Socioeconomic Data................................................................................................................................ 81 Figure83 - City of Homer Tax Revenue............................................................................................................................................ 82 Figure 84 - Gross Business Sales in City of Homer (in $1000s)....................................................................................................... 83 Figure 85 - City of Kenai Socioeconomic Data.................................................................................................................................. 84 Figure86 - City of Kenai Tax Revenue............................................................................................................................................... 85 Figure 87 - Gross Sales in City of Kenai (in $1000s)......................................................................................................................... 86 Figure 88 - City of Seldovia Tax Revenue.......................................................................................................................................... 87 Figure 89 - Gross Sales for City of Seldovia (in $1000s)................................................................................................................... 88 Figure 90 - City of Seward Socioeconomic Data............................................................................................................................... 89 Figure91 - City of Seward Tax Revenue............................................................................................................................................ 90 Figure 92 - Gross Sales for City of Seward (in $1000s)..................................................................................................................... 91 Figure 93 - City of Soldotna Socioeconomic Data.............................................................................................................................92 Figure94 - City of Soldotna Tax Revenue......................................................................................................................................... 93 Figure 95 - Gross Sales for City of Soldotna (in $1000s).................................................................................................................94 Matanuska Susitna Borough Kenai Peninsula Borough l I Mt. Spurr OFNEW Nikiski CDP Anchorage O Kenai O Soldotna Seward Homer T� " O C1� Seldovia l f 100 M Miles Flu '---- g ��i a CDP cAl k C D P CDP _ r rw Hope CDP w Sunrise CDP L__ e Salamatof CDP Ridgeway CDP Sterling CDP City of Kenai Kalg in Kalifornsk CDP-----.Is land. r�� y � Funny River CDP City of Soldotna Coho Clam Gulch Cooper anding CDP Moose Pass CDP Crown Point CDP ~Kasilof CDP e CDP Primrose CDP--- CDP �� Bear Creek CDP Ninilchik CDP �¢ City of Seward ---I Lowell Point CDP Happy Valley CDP Nikolaevsk CDP P ' Fox River CDP Anchor Point CDP Fritz Creek CDP Diamond Ridge CDP Kachemak Cit - y , � � N City of Homer-4-e- Q 'che a� Halibut Cove CDP ".� mak B � Source Data. -+:-- � - US Census Bureau " *�Seldovia e Villa CDP_ Kenai Peninsula Borough g �" State of Alaska " USGS City of Seldovia " Port Graham CDP . 20 Miles Nanwalek CDP Kenai Peninsula Borough low Cities and Census Designated Places Alaska Map Company, LLC 1 Kenai Peninsula at a Glance and Executive Summary Population 56,610 57,415 57,763 348 1% 2% Median Age 40.9 41.1 41.1 0 - 0.2 yr Number < age 5 31594 3,679 3,549 -130 4% -1% Number > age 64 6,738 81161 8,594 433 5% 28% Number of PFDs 53,145 (110) 53,217 ('13) 53,656 ('14) 439 1% 1% Income 2010 1 1 • Total Personal Income $2,364,609,000 $2,739,895,000 $2,917,537,000 $177,642,000 6% 23% Per -Capita Income $42,555 $48,012 $50,760 $2,748 6% 19% Alaska Per Capita Income $471773 $51,259 $54,012 $2,753 5% 13% Median Household Income $57,454 $61/793 $63,099 $1,306 2% 10% Alaska Median Household $66,521 $70,760 $71,829 $1,069 2% 8% Income Free Lunch Eligibility 42% 39% 38% (% of all students 110/111 '13/'14 114/115 1% - -5% Number AK Business Licenses with 6,195 ('16) KPB Location Number Self-Employed/Proprietors 61117 (109) 6117 (' 12) 61110 (' 13) -9 0% 0% Gross Earnings from Self -Employed $246,342,000 $2771153,000 $2801868,000 $34 526 000 12% 14% Proprietors (109) (112) (113) Number Employees (ave. ann.) 19,123 20,704 20,782 78 0% 9% Total Government Employment 41740 4,820 4,875 55 1% 3% Total Private Sector Employment 14,384 15,884 15,907 23 0% 11% Total Employees Wages $787,672,297 $9531673,438 $9721205,459 $18,532,021 2% 23% Total Government Wages $227,659,325 $2471156,180 $2541107,499 $6,951,319 3% 12% Total Private Sector Wages $560,012,972 $706,517,257 $718,0971960 $11,5801703 2% 28% Average Annual Wage $41,190 $46,062 $46,781 $719 2% 14% Annual Unemployment Rate 111 114 115 9.5% ) 7.8% ( ) 7.8 % ( ) - - -1.7% not seasonallyadjusted)( • Families Below Poverty 5.6% 5.1% 5.8% 0.7% - 0.2% • Families Below Poverty with 18.5% 15.0% 16.9% 1.9% - -1.6% female head of house, no husband Gross Business Sales 20111 1 • Grand Total $3,603,606,805 $4,331,814/169 $31751,8311463 -$5791982,706 -13% 4% Retail & Wholesale Trade $1,432/513,902 $1,363,785,081 $11275,8241018 -$87,961,063 -6% -11% Oil & Gas, Mining $358,414,721 $1,187,150,909 $7551143,915 -$432,006,994 -36% 111% Construction Contracting $5651883/608 $4921129/671 $484/427,149 -$7,702,522 -2% -14% Tourism (A&E, Guides, Lodging, 221 448 627 $ 257 012 606 $ 271 188 229 $14175 623 6% 22% Restaurants/Bars)$ Services (other) $111,828,223 $186,336,968 $166,546,039 -$19,790,929 -11% 49% Utilities $1491208,806 $1441760,781 $158,4281172 $13,667,391 9% 6% Property Rentals (all) $104,607,580 $120,431,335 $128,047,032 $7,615,697 6% 22% Manufacturing $1781084/776 $1271020/578 $121/971/981 -$5f048f597 4% -32% Transportation & Warehousing $145,925,448 $119,961,880 $119,329,396 -$632,484 -1% -18% Prof. Svs, Finance & Insurance, Public Admin, Management $1571265,287 $1591504,970 $107,8391668 -$51,665,302 -32% -31% Companies, Education Svs KPEDD 2016 Situations & Prospects - Page 1 Gross Business Sales 2011 20141 • Waste Management, Admin, $ 81 656 789 $ 72 064 004 62 827130 $ ' -$9,236,874 -13% -23% Remediation Telecomm, Information $681318,422 $641445,739 $60,331,414 -$4,1141325 -6% -12% Health Care, Social Assistance $23,366,404 $341155,336 $36,509,660 $2,354,324 7% 56% A Forestry, Fishing, Hunting , $3,424,002 $3,054,311 $3,417,660 $363,349 12% 0% Schools 1 1 1 • PK-12 School District Enrollment 91222 9,150 91132 -18 0% -1% (111/112) (14/15) (115/'16) 3.0% 2.8% 2.8% Dropout Rate ' 10/' 11 ' 13/' 14 ' 14/' 15 0.0% - Ave. SAT / ACT Test Scores 1562 / 23.1 1496 / 21.7 / 22.3 /+0.6 - - Full & part time KPC and AVTEC students 4 027 4 105 4 281 ' 176 4% 6% Housing 2011 20141 • Number of New Dwelling Units 72 121 204 83 69% 183% (5 cities) Number of Dwelling Units 5rave./ACS 29,510 30,498 30,638 140 0% 4% Number Dwelling Units Occu ied 22,303 21,720 21,559 -161 -1% -3% Ave. Price SF Home $225,804 $246,948 $256,328 $9,380 4% 14% Statewide Ave. price $281,744 $306,042 $315,602 $9,560 3% 12% Ave. Rent (Contract) $831 $831 $859 $28 3% 3% Statewide Survey Ave. Rent $1,011 $1,082 $1,097 $15 1% 9% Homeowners w mortgage: paying >30% income for housing 32.6% 31.6% 29.1% -2.5% - Renters: % paying >30% income for 44.1% 39.7% 41.4% 1.7% - - housing State Fish Tax shared with $2,009,804 $1,775,545 $1,212,640 KPB/cities state FY ) FY'11 ( ) FY ' (14 ) ' FY15) -$562,905 -46% -$797,164 Total Pounds Landed in KPB (pounds) 171,744,645 1851479,739 145 609 946 i i -39 869 793 r r -27% -26134 699 r r Ex -Vessel Value Landed in KPB $125,1261250 $1361515,228 $115,963,196 -$20,5521032 -18% -$9,1631054 Passenger Transportation1 1 1 Total Passenger Arrivals 336,848 347,330 419,993 72,603 21% 25% Airline Passenger Arrivals 142/566 144/ 181 111,004 -33,177 -23% -22% Railroad Passengers (total) 66,477 80,320 87,644 7,324 9% 32% AMHS Passengers Disembarking (Homer, Seldovia) 15,809 14 840 13,105 -1 735 -12% -17% Cruise Passengers 151,513 148,778 2041250 55,472 37% 35% AADT- Seward Hwy @Placer River 3,865 4,012 4,214 202 5% 9% Bride AADT- at the "Y." Sterling Hwy & 16 650 18 275 15 168 -3107 ' -17% -9% Kenai Spur Rd Agriculture 20112014 2015 -1-Yr Chg 5-Yr Chg Total Number of High Tunnels 101 252 314 62 25% 211% Total Income, Farms (Gross, not $3,478,000 $47244,000 $7,3401000 Net ' 10 ( ) ' 13 ( ) ' 14 ) $3,096,000 73% 111% Data sources and details in report chapters KPEDD 2016 Situations & Prospects - Page 2 Economic indicators were mixed in 2015 on the Kenai Peninsula. Some sectors on the Peninsula had the best growth in five years, others slowed down. Entrepreneurs are making investments, housing is still the most affordable in Southcentral Alaska, total personal income (2014) grew at a very healthy rate of 6% and 27% of households earned $100,000 or more. However, the number of students qualifying for free or reduced fee lunches remained at 38% and 19% of households have an annual income less than $25,000. The size of the overall workforce on the Kenai Peninsula was unchanged between 2014 and 2015, staying at 26,940. The number of self-employed businesses proprietors increased by 380 and the number of wage and salary employees declined by 380. Total work income was up by $30 million or 2%, beating inflation which was half of one percent in 2015 in Alaska. Total employee compensation was up by 1% or $13.8 million on the Peninsula and self-employed business owner's receipts were up by $16.3 million or 6%. The top five economic sectors, as measured by size of the workforce, have not changed for three years. However, a review of the top five sectors, as measured by total earnings, showed some economic shifts occurring in 2015: • Construction slipped out of the top five sectors for work income. Mining, oil, and gas slipped from 2nd to 3rd place as oil and gas work slows down (in 2013 it was in 1st place). • Retail trade entered the top 5, trading places with construction, which is now ranked 6th Population continues to grow. Between 2014 and 2015, the borough's population grew by 0.6% or 348 residents, from 57,415 to 57,763. This continued a trend of population growth - since 2000 the population of the Kenai Peninsula increased by 8,395 residents or 17% overall. The state's newly issued population projections expect continued growth on the Peninsula. The projection anticipates the percentage of youth age 0 to 19 on the Peninsula to slowly rise, from 14,550 in 2015 to 17,840 in 2045. In 2015, people age 65 or older in the Kenai Peninsula Borough were 15% of the total population. This was a 5% increase in just one year, from 8,161 people in 2014 to 8,594 people in 2015. The population age 80 and older was at 3% of the total in 2015. The percentage of seniors that are part of the Peninsula's total population is expected to rise until 2030, when those age 65 or older will hit 23% of the total, and then begin slowly declining. Approximately 804,000 square feet (sf) of built space was added or improved in 2015 that included 580,000 sf residential development (new, additions, mobile homes, etc.) in 379 dwelling units, and 225,000 sf of commercial/industrial development (new, additions, fuel tanks, etc.) in 225 buildings. The availability and affordability of housing on the Kenai Peninsula is an asset and advantage for the region because nearby Anchorage, Mat -Su, and Valdez -Cordova have a more constrained and expensive housing market. The average sale price of single-family homes on the Kenai Peninsula was $256,328 in 2015, a 3.8% increase from 2014, according to the Alaska Department of Labor and Workforce Development (ADOLWD). Another source, the Alaska Multiple Listing Service, shows that in 2015, 812 dwelling units (of all types) sold on the Kenai Peninsula with a median sale price of $210,000. Homes were on the market an average of 124 days in 2015. KPEDD 2016 Situations & Prospects — Page 3 Total taxable sales in 2015 on the Kenai Peninsula were $1,024,252,931, down by 1% or $12 million since 2014. Business activity as measured by gross sales however, is the economic indicator of most concern. Gross business sales are a very good proxy for business activity and investment. Gross sales dropped 14% between 2014 and 2015, from $4.33 billion to $3.75 billion. For perspective, gross sales activity on the Peninsula in 2015 was essentially the same as in 2013. Businesses with the largest drop in gross sales in 2015 (with the size of decline in parentheses) were: • Mining, Quarrying, Oil &Gas (-$432.0 million) • Professional, Scientific, and Technical Services (-$57.8 million) • Wholesale Trade (-$44.5 million) • Retail Trade (-$43.5 million) • Services (-$19.8 million) Lines of business with the highest increased gross sales were: • Utilities (+$13.7 million) • Fire &Insurance (+$7.2 million) • Rental Residential Property (+$5.6 million) • Guiding Water (+$5.7 million) Despite the overall decline in gross sales activity on the Peninsula between 2014 and 2015, gross business sales grew in the cities of Kenai and Soldotna in 2015. There was a decline in business activity in Homer, Seward, Seldovia, and in places outside of cities. Key industry highlights follow now. The Oil and Gas industry is a major economic driver on the Kenai Peninsula, pumping $795 million in gross business sales into the economy in 2015, which was 21 % of all business sales on the Peninsula that year. However, gross business sales declined 35% or $432 million between 2014 and 2015, though this is still well above business spending levels prior to 2011. In 2015 oil, gas, and other hydrocarbon -based businesses paid out $166 million in wages, which was approximately 17% of all wages to employees on the Peninsula. This wage total was an increase of $800,000 compared to 2014, even though total workers were 250 fewer. Maritime jobs are those linked to the ocean or rivers, those who "touch" the sea. This includes fishermen, cannery workers, barge line operators, oil and gas vessel support, SeaLife Center researchers and employees, AVTEC maritime instructors, sport fish guides and whale watch charters, marine biologists, engineers, and surveyors, fishing crew, fishing gear retailers, fish wholesalers, local government port and harbor workers, state and federal fishery scientists and technicians, and more. Statistics typically aggregate maritime work and economic activity as part of many different industry sectors, so they are "hidden" as part of other work. When pulled together, maritime -related work is tied with health care as the largest source of employment on the Peninsula. Maritime work generated more earnings, at $177 million in 2014, than any other type of work; the next closest are Oil and Gas, and Local Government. KPEDD 2016 Situations & Prospects — Page 4 Over 3,400 worked in a maritime -related job on the Kenai Peninsula in 2014. The number of workers is up by 90 compared to 2013; however total earnings declined by $12 million. Earnings were down for most parts of the maritime industry, with the exception of water transportation and marine leisure and hospitality businesses. Commercial Fishing is a component of maritime work, and is a major industry in the Kenai Peninsula Borough. Residents of the Kenai Peninsula have a long and successful history in commercial fishing and seafood processing. Residents from 17 communities on the Kenai Peninsula commercial fished in 2014. In 2014, Seward was ranked 21St top US port for value and 26th for pounds and Kenai was ranked 35th for value and 33rd for pounds. For the commercial Pacific Halibut harvest in 2015, Homer was the 2nd top port in the US with 345 vessels landing 2.6 million pounds or 15% of the total harvest. Seward was the top US Sablefish port in 2015, with 316 vessels landing 5 million pounds or 25% of the US harvest across its docks. The Kenai Peninsula Borough has just under 8% of Alaska's population, and in 2014 its' residents: • Received 7% of the state's total commercial fish gross earnings • Harvested 3% of all commercial caught fish in Alaska • Were 11 % of the state's commercial permit holders • Accounted for 12% of all commercial permits fished Combining employment and proprietor data from several sources yields an estimate of 537 average annual workers, and over 2,200 working during peak season, in commercial fishing or seafood processing on the Kenai Peninsula. Income, from earnings and wages, is estimated at between $122 and $137 million. Cook Inlet sockeye salmon typically are 70-85% of all pounds of salmon commercially harvested in Cook Inlet; however, in 2015 they were only 38% of the total haul because there was a 5-fold increase in the pounds of pinks harvested that year. This pink salmon harvest broke records for the Cook Inlet region. Sockeye salmon was still the money fish though, accounting for almost $24 million or 79% of the total ex -vessel value for all Cook Inlet salmon commercially harvested in 2015. The average value of a Cook Inlet purse seine permit slipped $1,200 between 2015 and 2014; however, the 2014 value of $86,000 was a 20-year high. The value of Cook Inlet drift gillnet permits dropped 15% between 2014 and 2015, to $63,500. The Visitor Industry experienced very strong growth in 2015. Gross sales from visitor -industry related businesses increased from $257 million in 2014, to $271 million in 2015, up 6%. This is a 15% increase compared to gross sales five years ago. • Employment was up by 74 between 2014 and 2015, and total wages increased $2.9 million during this period. Looking at all data sources, there are over 1,000 large and small business owners with a low of 1,870 workers in January to a higher of 4,217 employed July workers in tourism businesses in the Kenai Peninsula Borough. Accommodation and Food Services work continues to drive the sector, generating over 80% of the employment and wages. KPEDD 2016 Situations & Prospects — Page 5 The state shares a portion of a $5/passenger commercial passenger vessel (CPV) excise tax it collects on cruise ship passengers with the 1st seven ports of call in the state, distributing it to boroughs and cities. In FY 2015, this brought $361,658 to the Kenai Borough, $347,733 to Seward, and $13,925 to Homer. Expect increases from this shared tax next year because the number of cruise ship passengers visiting the Kenai region in 2015 increased 37% compared to 2014. A number of destinations around the Peninsula also recorded increases in visitor traffic in 2015. The Alaska SeaLife Center in Seward welcomed 149,842 visitors to their aquarium (not including participants in their education programs), a 5% increase from 2014. Nearly 300,000 people paid a visit to Kenai Fjords National Park in 2015, a 10% increase over 2014 figures. Gross sales from guided land and water activity and businesses in the borough have increased significantly over the last five years. And, gross business sales increased steeply between 2014 and 2015, rising 14% for guided land sales and 9% for guided water activity. The Health Care and Social Assistance workforce was the largest of any traditional economic sector on the Peninsula in 2015, and the 2nd highest for total wages and earnings (when employees and self-employed small business owners are combined). The ADOLWD outlook for virtually all Alaska health care occupations is strong to robust growth, and most occupations have high job openings. The number of local health care and social assistance jobs grew between 2010 and 2014, but dropped by 71 or 2% in 2015. In 2015, 190 employers with 3,194 employees in a health -related field earned $134.3 million. There were also 273 small businesses owned by a sole proprietor who provided health and social services in 2014, earning $8 million. Collage of Kenai Peninsula activity. From Top L: Central Peninsula Hospital Dr. Humphreys and spine imaging unit, Vigor Shipyard in Seward, Satathite family runs the Turkey Trot 10K, LNG Workers in Kenai. Photos by Rashah McChesney and Brian Smith courtesy of Peninsula Clarion, and Shipyard by Barbara Sheinberg. KPEDD 2016 Situations & Prospects — Page 6 2 Demographics 2.1 Overall Population Between 2014 and 2015, the borough's population grew by 0.6% or 348 residents, from 57,415 to 57,763 (Figures 1 and 2). This continues a trend of population growth; since 2000 the population of the Kenai Peninsula increased by 8,395 residents or 17% overall. This equals an average annual growth rate of 1% during this period. Population has grown in all cities except Seldovia over the last year and five-year periods. Results are mixed over communities/census designated places (CDPs). Higher rates of population loss were in Primrose, Lowell Point, Crown Point, Cooper Landing, and Clam Gulch. Higher rates of population growth were in Hope, Fritz Creek, Kalif ornsky, Nanwalek, and Port Graham (Figure 3) . Figure 1- Population Indicators, Kenai Peninsula Borou Population 56,610 57,415 57,763 0.6% 2.0% PFDs total 52,974 53,073 53,656 1.2% 1.3% PFDs children under 18 12,364 12,218 12,249 0.3% -0.9% PK-12 School Enrollment 91222 91150 91132 -0.2% -2.1% Sources: ADOLWD Population Estimates 2010-2015, ADEED District Enrollment, Alaska Permanent Fund Division Annual Reports The Peninsula's population fluctuates annually as a result of births, deaths, and in and out -migration. Migration in and out of Alaskan communities is tracked using addresses provided on Permanent Fund Dividend (PFD) applications. These records track population closely, although they reflect a delay of up to two years, as individuals must live in Alaska for one calendar year starting January 1st before they can apply to receive the dividend. Figure 2 - Population Growth, Kenai Peninsula Borough 60,000 50,000 40,000 30,000 20,000 10,000 ® •1 0 1950 1960 1970 1980 1990 2000 2010 2011 2012 2013 2014 2015 Source: ADOLWD Population Est. 2010-2015, Historical Data 2000-2010, 1990-2000, 1980-1990, 1970-1979 KPEDD 2016 Situations & Prospects — Page 7 Figure 3 - Population by Place, 2011-2015 Kenai Peninsula Borough 56,610 57,415 57,763 0.6% 2.0% Anchor Point CDP 1,989 2,060 21054 -0.3% 3.3% Bear Creek CDP 11986 11995 2,063 3.4% 3.9% Beluga CDP 19 17 19 11.8% 0.0% Clam Gulch CDP 193 179 178 -0.6% -7.8% Cohoe CDP 11425 11411 11463 3.7% 2.7% Cooper Landing CDP 285 296 271 -8.4% -4.9% Crown Point CDP 72 68 58 -14.7% -19.4% Diamond Ridge CDP 11183 11168 11149 -1.6% -2.9% Fox River CDP 658 648 673 3.9% 2.3% Fritz Creek CDP 11903 21034 21043 0.4% 7.4% Funny River CDP 910 881 943 7.0% 3.6% Halibut Cove CDP 82 65 72 10.8% -12.2% Hammy Valley CDP 604 580 585 0.9% -3.1% Homer city 51116 51138 51153 T 0.3% 0.7% Hope CDP 190 196 208 6.1% 9.5% Kachemak city 461 467 483 3.4% 4.8% Kalifornsky CDP 8,068 8,468 8,534 0.8% 5.8% Kasilof CDP 568 571 560 -1.9% -1.4% Kenai city 7,172 71183 71229 0.6% 0.8% Lowell Point CDP 73 69 64 -7.2% -12.3% Moose Pass CDP 240 235 226 -3.8% 6.5% -5.8% 5.0% Nanwalek CDP 280 276 294 Nikiski CDP 41648 41679 41553 -2.7% -2.0% Nikolaevsk CDP 307 271 276 1.8% -10.1% Ninilchik CDP 883 854 849 -0.6% -3.9% Point Possession CDP 3 3 3 0.0% 0.0% 4.7% 2.9% Port Graham CDP 172 169 177 Primrose CDP 84 77 66 -14.3% -21.4% -0.6% 7.2% Ridgeway CDP 21056 2,219 21205 3.7% 10.3% Salamatof CDP 11054 11122 11163 -3.4% -7.8% Seldovia city 245 234 226 Seldovia Village CDP 162 170 169 -0.6% 4.3% Seward city 21735 21732 21740 0.3% 0.2% Soldotna city 41289 41300 41319 0.4% 0.7% Sterling CDP 5,795 5,900 5,992 1.6% 3.4% 22.2% -21.4% Sunrise CDP 14 9 11 0.0% -4.4% Tyonek CDP 183 175 175 4.2% 2.8% Balance 503 496 517 Source: ADOLWD, Population Estimates BY Borough, Census Designated Places (CDP), 2010-2015 KPEDD 2016 Situations & Prospects - Page 8 According to the Alaska Department of Labor and Workforce Development (ADOLWD) between 2014 and 2015, the Kenai Peninsula gained 348 new residents. This includes migration, births, and deaths. The net change due to migration in and out of the borough last year was 82 new residents. The change due to natural conditions was 704 births, and 436 deaths, yielding 266 net new residents. Together, this is 348 new residents. Figure 4 - Components of Population Change, Kenai Peninsula Borough 2014-15 57,763 348 0.60 704 438 266 82 2013-14 57,415 553 0.97 710 383 327 226 2012-13 56,862 190 0.33 713 386 327 -137 2011-12 56,672 62 0.11 715 336 379 -317 2010-11 56,610 880 1.57 711 377 334 546 2010 55,730 330 2.38 176 98 78 252 Source: ADOLWD Components of Population Change 2010-2015 2.2 Population Projection including Age Distribution In 2015, people age 65 and older in the Kenai Peninsula Borough were 15% of the total population. This was a 5% increase in just one year, from 8,161 people in 2014 to 8,594 people in 2015. The population age 80 and older was at 3% of the total in 2015, an increase of 4% in one year. ADOLWD projects continued increases in the senior population on the Peninsula and throughout Alaska as Baby Boomers age. By 2045, the percentage of people age 65 or older is projected at 21% of the Kenai Peninsula Borough's total population, while those age 80 or older are projected to be 8% of the region. Increasing attention is needed to senior transportation, housing, social, and medical needs to ensure residents can age in place and in their communities and remain with family and friends. Figure 6 - Kenai Peninsula Population, 2015 90+ 80-84 70-74 60-64 50-54 40-44 30-34 20-24 10-14 0-4 31000 2,000 11000 0 11000 21000 3,000 Source: ADOLWD Population Estimates 2010-2015 EN Figure 6 - Projected Kenai Peninsula Population, 2045 90+ 80-84 70-74 60-64 50-54 40-44 30-34 20-24 10-14 0-4 0 WOMEN ■ MEN 31000 21000 1,000 0 11000 21000 3,000 Source: ADOLWD Population Projections 2015-2045 KPEDD 2016 Situations & Prospects — Page 9 Population projections issued in 2016 by the ADOLWD expect that both the Kenai Peninsula and the State of Alaska will continue to grow over the next 25 years. However, growth on the Peninsula is projected to slightly slow from the current average annual population change of 0.6% to 0.4% by 2040. Figure 7 - Population, Past and Projected, Kenai Peninsula Borough and Alaska 100,000 1,000,000 90,000 • ... •• 900,000 ......•, 80,000 . • • •••''''' 800,000 • ••• • 70,000 700,000 60,000 00000 '000 ..009.0000000000000 ... • • •''''''• 600,000 00 0 • 0 PLO 50,000 500,000 x 40,000 400,000 30,000 300,000 20,000 200,000 o oo� ti o,�� � ono o�� ti r ono ti o�� r ono r ti Source: ADOLWD tKenai AK Church group brings youth to elderly at Heritage Place. Photo by M. Scott Moon, courtesy of Peninsula Clarion. Venice Norris, right, serves Mary Colston tea at Heritage Place. KPEDD 2016 Situations & Prospects — Page 10 3 Education 3.1 Kenai Peninsula Borough School District Declines in the number of youth enrolled in the Kenai Peninsula Borough School District (KPBSD) continued in academic year 2015/2016. The number of pre -kindergarten through 12th grade students enrolled in local schools declined 18 students from 9,150 students to 9,132, between academic year 2014/2015 and 2015/2016. Despite this decline, the number of borough residents age 5 through 19 has increased Wes. every year since 2012, according to the ADOLWD. This implies increasing participation in correspondence and homeschool programs. Enrollment declines were not spread evenly; in fact, enrollment for 2015/2016 was up at schools in Cohoe, Kalifornsky, Kenai, Seldovia, Seward, Soldotna, and Tyonek (Figure 8). Despite overall reduced school enrollments, some schools in the district are operating over capacity. For example, Nanwalek School is operating near 150% capacity, with an official enrollment count of 78 in a school building designed to serve 60 students. The impact of declining state revenue on education funding could also affect class size in the future. The Kenai Peninsula Borough School District has enjoyed increasing high school graduation rates for the last ten years, a trend that continued in academic year 2014/2015. In 2014/2015, the graduation rate was 81.7%, a 9% increase from five years ago, and a 15% increase since 2004/2005. School district administrators noted that recent graduates were some of the first to benefit from targeted preschool reading and literacy intervention programs, which may have contributed to student success. District officials also find that students have benefited from Career and Technical Education programs funded by the legislature in 2011. Career readiness trainings, along with several alternative education programs throughout the borough, allow students to focus on areas of interest with real -world applications, providing critical support for students at risk of dropping out. In addition to notable improvements in graduation rates and reductions in dropout rates, Kenai Peninsula high school students continue to achieve higher college preparatory test scores compared to statewide averages. KPBSD students scored an average of 22.3 overall on the ACT test in 2015, while the state average was 21.1 (Figure 10). In 2015, Alaskan schools throughout the state instituted new statewide assessment program known as the Alaska Measures of Progress (AMP), which replaced former Standards Based Assessments (SBA). AMP scores are not comparable to SBA results. Furthermore, the program is undergoing adjustments following the initial implementation, and additional changes were made to the AMP for the 2015/2016 school year, with the intent of using this year as a future baseline. AMP results will be reported in future Situations & Prospects. Preliminary testing results from 2015 show Kenai Peninsula Borough School District out -performing the neighboring Anchorage and MatSu School Districts in both English Language Arts and Math proficiency. Kenai Peninsula College, Process Technology assistant professor Haney. Photo Courtesy of Peninsula Clarion, by Kaylee Osowski KPEDD 2016 Situations & Prospects — Page 11 Figure 8 - Total Enrollment, by School and Community (PK-12) R6 '6ChangeCommunity '11jh12 '14/'15 11"15/' Kenai Peninsula Borough School District 91222 91150 Chapman School Anchor Point 123 113 Anchor Point Total 123 113 Tustumena Elementary Cohoe 168 181 Cohoe Total 168 181 Cooper Cooper Landing School Landing 10 19 Cooper Landing Total 10 19 Kachemak Selo School Fox River 75 57 17 6 91132 115 1-Yr 5-Yr Change -18 -90 2 -8 115 186 186 5 18 15 15 -4 5 49 Razdolna School Fox River Voznesenka School Fox River Fox River Total McNeil Canyon Elementary Fritz Creek Fritz Creek Total Fireweed Academy Homer 66 83 83 117 115 257 247 120 116 120 116 106 247 -10 0 126 126 -4 -10 130 103 92 Homer Flex School Homer Homer High School Homer Homer Middle School Homer Paul Banks Elementary Homer West Homer Elementary Homer Homer Total Hope School Hope Hope Total River City Academy Kalifornsky Skyview Middle/High School Kalifornsky Kalifornsky Total Aurora Borealis Charter School Kenai Kaleidoscope Sch. of Arts and Sci. Kenai Kenai Alternative High School Kenai Kenai Central High School Kenai Kenai Middle School Kenai Kenai Peninsula Youth Facility Kenai 32 31 35 407 385 199 192 212 216 y 228 245 429 199 169 224 -15 -18 1183 1180 1165 22 16 12 12 22 16 -6 4 73 88 73 375 395 421 448 483 494 188 181 253 256 77 78 511 523 11 46 193 248 88 542 366 383 382 - - - Marathon School Kenai Mt. View Elementary Kenai Kenai Total Moose Pass School Moose Pass Moose Pass Total Nanwalek School Nanwalek Nanwalek Total Nikiski Middle/High School Nikiski Nikiski North Star Elementary Nikiski Nikiski Total Nikolaevsk School FNikolaevsk Nikolaevsk Total Ninilchik School Ninilchik Ninilchik Total 6 10 453 1875 14 14 11 454 1885 10 10 463 1906 18 10 -21 -4 -8 18 78 78 78 78 78 78 413 374 370 373 783 747 0 0 404 366 770 -36 -23 71 64 66 71 64 L 66 164 141 164 141 2 -5 172 172 -23 -31 KPEDD 2016 Situations & Prospects — Page 12 ' Port Graham School I Port Graham Port Graham Total Susan B English School Seldovia Seldovia Total Seward Elementary Seward Seward High School Seward Seward Middle School Seward 22 22 47 47 282 178 83 27 27 27 27 0 5 41 48 41 48 7 1 300 310 186 178 125 146 Spring Creek School Connections Kalifornsky Beach Elementary Redoubt Elementary Soldotna Elementary School Seward Seward Total Soldotna Soldotna Soldotna Soldotna 11 - - 554 611 634 23 80 871 734 778 405 390 427 393 424 370 295 320 342 1 Soldotna High School Soldotna 521 605 588 Soldotna Middle School Soldotna 408 - - Soldotna Montessori Charter Sch. Soldotna 167 155 162 Soldotna Prep School Soldotna - 208 195 Soldotna Total 3060 2836 2862 Sterling Elementary FSterling167 251 241 Sterling Total 167 251 241 Tebu hna School T onek 40 31 39 Tyonek Total 40 31 39 Source: Alaska DEED, Enrollment Totals for all Alaskan Schools -198 74 26 -10 8 -1 Figure 9 - Kenai Peninsula Borough School District ° Comparison of Graduation and Drop -out Rates 85 /° c 83% 81% 79% Oe C� 77% 75% 400 73% 71% 69% 67% 65% '10 6 000 OOb 00� OOcb 00� O,�O O�� O,�`l• O�� O'��" Graduation Rate f Dropout Rate 20% 18% 16% 14% a� 12% �4 10% 8 % 0 6% A 4% 2% 0% KPEDD 2016 Situations & Prospects — Page 13 Figure 10 - SAT and ACT Test Scores 2008 2009 2010 2011 2012 2013 2014 2015 24.0 21.2 1572 1533 23.7 21.0 1570 1528 23.1 21.1 1544 1509 23.1 21.2 1562 1513 22.3 21.2 1516 1504 22.5 21.1 1493 1495 21.7 21.0 1496 1485 22.3 21.1 N/A N/A Source: Kenai Peninsula Borough School District Student Assessment Results 3.2 Postsecondary Schools Enrollment increased in 2015 at both the Kenai Peninsula College (KPC) and the Alaska Vocational Technical Education Center (AVTEC) in Seward. KPC enrollment in all campuses in the spring quarter of 2015 reached 2,883 students, an increase of 58 more students than the previous spring. The Process Technology program, which enrolled 225 students in the spring of 2015, continues to be a critical workforce training resource for the region, especially in the oil and gas industry. AVTEC saw enrollment increase by 118 students from Fiscal Year (FY) '14 to FY'15. The training center anticipates increased future enrollment as well due in part to an expanding array of U.S. Coast Guard -certified maritime courses designed to meet newly adopted workforce training requirements. The Kenai Peninsula College Metal Moose Sculpture Figure 11- AVTEC and Kenai Peninsula College, Number of Enrolled Students 4500 4000 3500 - 3000 - - 2 434 2, 718 2825 2883 2500 3,025 2,905 2000 1,988 21195 1500 1000 1• 1121 81 .. 500 1009 976 IL it 0 1 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 ■ AVTEC Students 0 KPC-All Campuses KPEDD 2016 Situations & Prospects — Page 14 4 Housing The availability and affordability of housing on the Kenai Peninsula is an asset and advantage for the region because nearby Anchorage, Mat -Su, and Valdez - Cordova have a more constrained and expensive housing market. Kenai Peninsula is therefore a more affordable place to rent or buy a home (see chapter 5 Cost of Living, Figures 15 and 16). According to the 2010-2014 American Community Survey (ACS), there were 30,698 housing units on the Kenai Peninsula, of which 21,559 were occupied. The 2010-2014 ACS reports that the vast majority of residents own their homes: of all occupied homes, 15,770 or 73% were owner -occupied. The average sale price of single-family homes on the Kenai Peninsula was $256,328 in 2015, a 3.8% increase from 2014, according to the ADOLWD. Another data source, the Multiple Listing Service, shows that in 2015, 812 dwelling units (of all types) sold on the Kenai Peninsula with a median sale price of $210,000. Homes were on the market an average of 124 days in 2015. Single-family home prices have grown steadily over the last ten years, while condominium prices, which lost value from 2008 through 2013, are now increasing as well (Figure 12). Multifamily residences, which include apartment buildings and duplexes, have a more erratic price history due to the inconsistency of sales and variety of housing types included in the category. $5001000 $450/000 $400/000 $350/000 $300/000 $250,000 $200/000 $150,000 $100/000 $50,000 $0 Figure 12 - Average Home Price, Kenai Peninsula Borough 1 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Single Family Source: ADOLWD Historical Lenders Survey ❑ Multi Family ♦Condo KPEDD 2016 Situations & Prospects — Page 15 Although smaller than the owner -occupied market, the rental market on the Kenai Peninsula is also robust and healthy. The ADOLWD 2015 Residential Rental Market Survey reported a 6.8% rental vacancy rate, and an average rent of $923 for single-family residences and apartments. Compared to other Southcentral Alaska places these rental costs are low (see chapter 5 Cost of Living, Figures 15 and 16). While the value of single-family homes is going up, the region also experienced a construction boom in 2015 with 204 new dwelling units built (Figure 13). • This is on top of 121 new units constructed in 2014. • Half of the 2015 housing construction happened in Soldotna, where 111 new units were built. Of all the new dwelling units built in 2015, 81% (166) were single-family homes, 13% were duplex units, 4% were in 3-4 plexes, and 2% were manufactured homes. Figure 13 - Number of New Dwelling Units Constructed 204 F® Soldotna 0 Seward ■ Seldovia El Kenai �0 Homer Source: Alaska Housing Finance Corporation, Housing Market Indicators If a household pays more than 40% of its income on housing, it is considered "housing -burdened." Housing costs here includes rent, mortgage, utilities, and insurance. As just noted, both rental and sale prices for housing on the Kenai Peninsula are the most affordable in Southcentral Alaska; however despite this, 29% of homeowners with a mortgage and 41 % of renters on the Peninsula pay more than 30% of their income on housing, according to the 2010-2014 ACS. The income of these 30-40% of households is not high enough to break out of the group considered housing -burdened. KPEDD 2016 Situations & Prospects - Page 16 5 Cost of Living Cost of Living is tied to the prices for everyday goods and services necessary to support a household, including housing, electricity, heat, and food. In June 2015 (Figure 14): • The cost of electricity was higher in select Kenai Peninsula cities than in other places in Southcentral Alaska, as has been typical. • Prices for gasoline were somewhat higher than in neighboring Southcentral places. • Heating fuel prices were lower than in Anchorage or Mat -Su in Kenai and Homer, but significantly higher in Seward and Seldovia. • Food costs in Kenai and Homer were respectively 11% and 17% higher than Anchorage prices. The effect of higher costs for household goods and utilities on the Kenai Peninsula is compounded by the fact that median household income of Kenai Peninsula residents is lower than in Anchorage or Mat -Su. Lower median income along with higher utility costs means that many Kenai residents must spend a higher percentage of their income on necessities such as food, gasoline, heat, electricity, and housing. Figure 14 - 2015 Household Expenses, Select Alaskan Communities moffla WRI-ellwi6m 0101&'m M . A-m ek Seldovi- Week of food for a $167.20 $173.50 $196.30 $185.20 - - family of four Electricity (1000 kWh) $172.00 $191.23 $243.03 $243.03 $204.73 $243.03 #1 Heating Oil ($/gal) $2.98 - $2.85 $2.64 $3.37 $4.10 Gasoline ($/gal) $3.25 $3.30 $3.60 $3.47 $3.66 $4.09 Propane ($/gal) $1.80 $4.53 $3.05 $2.60 - - Median Household 78 121 72 134 54 778 62 088 49 432 $ $ $ $ $ 45 000 $ ' Income Sources: Food Costs - University of Alaska, Fairbanks, Food Cost Survey; Electricity - Chugach Electric Association, Homer Electric Association, Matanuska Electric Association, Seward Light and Power, data for June 2015; Gasoline, Propane and Heating Oil — University of Alaska Fairbanks, except Seldovia and Seward — Alaska Housing Finance Corporation, Fuel Cost Survey - data for July 2015; Median Household Income — American Communities Survey 2010-2014 5-yr estimates. Housing costs are another significant contributor to a community's cost of living, and in this regard, the Kenai Peninsula is at an advantage (Figures 15 and 16). • According to the ADOLWD annual rental market study, the Kenai Peninsula continues to maintain the lowest rental costs in Southcentral Alaska and some of the lowest rental costs in Alaska. • Of the ten areas surveyed, only Wrangell had lower rental costs. Average rent prices increased by only 3% from 2014 to 2015, a rate of growth very similar to inflation. KPEDD 2016 Situations & Prospects - Page 17 Figure 15 - 2015 Housing Costs, Select Alaskan Boroughs/Census Areas Municipality of Anchorage $11135 $11141 1% 3.9% 6.8% Kenai Peninsula Borough $831 $859 3% 16.0% Fairbanks Northstar Borough $1,060 $1,054 -1% Juneau, City and Borough $1J17 $1,151 3% 3.4% Ketchikan Gateway Borough $912 $960 5% 13.3% Kodiak Island Borough $1,251 $1,277 2% 4.6% Matanuska Susitna Borough $1,022 $1,069 5% 3.3% Sitka, City and Borough $955 $965 1% 7.2% Valdez -Cordova Census Area $11120 $11128 1% 3.5% 5.6% Wrangell and Petersburg Boroughs $687 $685 0% F_ Source: ADOLWD Rental Market Survey Similar to trends in the rental market, the value of single-family homes on the Kenai Peninsula is also lower than many other areas in Alaska. The Alaska Housing Finance Corporation (AHFC) quarterly housing indicators report tracks the sale price of homes across the state. In 2015, the average sale price for single-family homes in the Kenai Peninsula Borough was $251,484, over $100,000 less than average sale prices in Anchorage. Of the regions surveyed by ADOLWD, only Fairbanks Northstar Borough reported lower home sale prices, at an average of $243,166. Figure 16 - 2015 Average Sale Price - Single Family Homes Select Alaska Boroughs/Census Areas Anchorage Municipality Matanuska-Susitna Borough Fairbanks North Star Borough Kenai Peninsula Borough Juneau Borough Ketchikan Gateway Borough Kodiak Island Borough Bethel Census Area Rest of State Statewide Average $249,088 $281,764 $314,243 $276,222 11 $273,397 $315,602 Source: Alaska Housing Finance Corporation, Housing Market Indicators KPEDD 2016 Situations & Prospects — Page 18 Construction costs can affect the cost of living by driving the cost of new housing and home maintenance. (Figure 17). The cost of a market basket of construction materials is measured annually by ADOLWD for AHFC. Across the 11 communities in the survey, the cost of construction materials in the city of Kenai were slightly higher than in Anchorage or Wasilla, and comparable to Juneau and Ketchikan. The price of construction materials increased in Kenai by 6% from 2014 to 2015, while costs decreased in Anchorage by 2% and increased in Wasilla by 10%. Transportation costs to ship construction goods from Seattle to Kenai decreased by 4% between 2014 and 2015, likely due to decreased fuel prices. Figure 17 - Residential Construction Costs ad] Average cost of Construction Market Basket (without concrete, rebar, doors or windows) Kenai (city) $23,282 $24,586 $27,360 $27,443 $29,018 6% 25% Anchorage $22,543 $21,524 $23,854 $23,848 $23,405 -2% 4% Fairbanks $22,484 $22,457 $25,744 $26,776 $26,971 100 20% Kodiak $24,210 $25,734 $27,276 $31,919 $30,826 -3% 27% Wasilla $21,776 $25,151 $23,862 $25,097 $27,604 10% 1 27% Transportation Cost of Market Basket (Shipping and handling from Seattle) Kenai (city) $8,093 $9,346 $11,137 $11,137 $10,740 -4% 33% Anchora e $7,116 $7,484 $8,245 $8,245 $9,049 10% 27% Fairbanks $8,777 $9,365 $9,279 $10,453 $10,842 400 24% Kodiak $10,615 $11,449 $8,376 $9,632 $11,275 17% 6% Wasilla $8,006 $8,332 $9,673 $9,673 $9,663 0% 21 % Construction baseline) Alaska Suppliers Comparison Index, Urban and Rural Residential (without concrete, rebar, doors or windows; Anchorage is Anchorage $100 $100 $100 $100 $100 Fairbanks $100 $104 $108 $112 $115 Juneau $99 $101 $110 $117 $119 Kenai (city) $103 $114 $115 $115 $124 Ketchikan $96 $115 $117 $117 $125 Kodiak $107 $120 $114 $134 $132 Sitka $92 $113 $115 $104 $112 Wasilla $97 $117 $100 $105 $118 Barrow $236 $249 $214 $226 $263 Bethel $142 $191 $161 $166 $213 Nome $170 $195 $176 $188 $197 Source: ADOLWD Construction Cost Survey KPEDD 2016 Situations & Prospects - Page 19 6 Building Construction and Assessed Property Value 6.1 Built Space Added or Improved Between 2010 and 2015, 6 million square feet (sf) of built space was constructed on the Kenai Peninsula. This included 3.6 million sf of residential development (new, additions, mobile homes, etc.) in 2,338 dwelling units and 2.4 million sf of commercial or industrial development (new, additions, fuel tanks, etc.) in 2,823 buildings. The six clusters that account for two-thirds of all building activity are around Kalifornsky (17%), Sterling (14%), Nikiski (9%), Soldotna (8%), Kenai (85), and Homer (8%) and Kenai (9%). Looking just at 2015, 804,000 sf was added that included 580,000 sf residential development (new, additions, mobile homes, etc.) in 379 dwelling units, and 225,000 sf of commercial/industrial development (new, additions, fuel tanks, etc.) in 225 buildings. Kalifornsky CDP Sterling CDP Nikiski CDP Soldotna city Kenai city Homer city Anchor Point CDP Salamatof CDP Ridgeway CDP Fritz Creek CDP Bear Creek CDP Ninilchik CDP Funny River CDP Cohoe CDP Seward city Diamond Ridge CDP Happy Valley CDP Fox River CDP Cooper Landing CDP Seldovia Village CDP Kasilof CDP Outside CDP Clam Gulch CDP Crown Point CDP Nikolaevsk CDP Seldovia city Hope CDP Kachemak city Moose Pass CDP Halibut Cove CDP Lowell Point CDP 0 200,000 475,035 472,764 241,696 165 252 189,926 263,481 building square footage 400,000 600,000 800,000 1,000,000 ❑ Residential (all types) ■ Commercial or Industrial Source: Kenai Peninsula Borough Tax Roll and Qualified Land Sales Data KPEDD 2016 Situations & Prospects - Page 20 6.2 Property Assessments and Taxes The strength of the region's tax base is linked to its ability to withstand change yet still provide reliable revenue to support desired services and operations. The value of the tax roll (the value of all assessed property in the borough) is thus part of the mix that contributes to a robust regional economy. Property tax rates have remained fairly steady in the Kenai Borough. Property tax rates vary by locality or Tax Authority Group (TAG). Property tax levy (mill) rates are set annually by the borough assembly, municipalities, and service areas boards. Sample current property tax mill rates are listed in Figure 19, and vary from a low of 5.9 (TAG 67, KPB Road Maintenance) to a high of 11.30 (Homer). A mill is 1/1000 of $1, so a home assessed at $200,000 where the mill levy is 8.86 would owe 0.00886 x $200,000 = $1,772 in annual property tax. Figure 19 - Example Mill Rates within Kenai Peninsula Borough IL • 20151 Homer - TAG 20 11.30 Seldovia - TAG 10 9.85 -4 Kachemak -TAG 80 7.80 Seward - TAG 40 8.37 Kenai -TAG 30 8.86 Soldotna - TAG 70 7.66 Source: Alaska Taxable The value of property typically slowly rises on pace with inflation. All things being equal, changes to the tax roll year over year are primarily due to changes in market conditions and to new growth. New growth includes subdivisions and improvements. The value of Kenai Peninsula tax roll increased 5% in 2015; this contrasts with 2014 when it had declined 1 %. Between 2014 and 2015, $590,000 or 1 %, less was collected in tax revenue. Property tax revenue increased in Kachemak and Soldotna and declined in other places. Figure 20 - Assessed Taxable Value of Property and Tax Revenue, by Place I - 111� 2012.1 2013.1 1 1 12011-2015 KP Borough I $6,666 $6,452 $6,693 1 $6,638 $6,967 5% 5% Homer $627 13% 8% $602 $618 $574 $649 $66 Kachemak $63 $66 $56 $69 23% 5% Kenai $616 $694 $755 $711 $806 13% 31% Seldovia $36 $35 $35 $32 $36 13% 0% Seward $234 $223 $228 $213 $240 F 13% 3% $461 $455 $440 $497 13% 8% Soldotna $455 $5,325 $4,355 $4,536 $4,613 $4,671 Outside Cities 1 % -12% Property(Includes Oil & Gas)Change Placj. 1.. 1., 1 1 1 1 1 1 1 KP Borough 1 $53.67 $54.07 1 $56.91 1 $58.67 + $58.08 -1% 8% Homer $2.91 $0.07 $3.00 $0.07 $3.06 $0.06 $3.40 $2.99 $0.07 $0.07 -12% 3% Kachemak 2% 2% $2.51 $2.89 $3.40 $3.41 Kenai $2.56 F 0% 36% Seldovia $0.18 $0.18 $0.10 $0.21 $0.18 -15% 1% Seward $0.95 $1.00 $1.01 $1.28 $0.99 -23% 3% -68% Soldotna 1 $0.87 1 $0.60 F $0.35 $0.27-F $0.28 4% source: Alaska Taxables, Tables 6 and 3 KPEDD 2016 Situations & Prospects - Page 21 6.3 Properties with Highest Assessed Value The 20 property owners with the highest assessed value in the Borough (Figure 21) continue to be oil and gas producers, companies that supply goods and services to the oil and gas industry, telecommunications companies (ACS), utilities (Enstar), and major retailers (Walmart, Fred Meyer). Figure 21- Top 20 Property Tax Payers Taxpayer Hilcorp Energy Company Conoco Phillips Tesoro Alaska Cook Inlet Natural Gas Storage Alaska LLC Cook Inlet Energy, LLC F ACS Alaska Pipeline Xto Energy Inc Harvest Alaska Enstar Natural Gas Furie Operating Alaska, LLC Wal-Mart Real Estate Business Trust 2015 1 2 3 4 _5 6 7 8 9 10 11 12 Assessed Property1 $573,814,820 $243,080,912 $188,467,683 $115,424,328 $84,438,950 $75,645,592 $631142,458 $58,045,010 $55,207,130 $44,4951401 $32,957,070 $26,565,300 1 113 1 2012 2008 2 2 2 3 3 3 4 1 4 5 9 10 19 5 6 5 6 7 8 10 11 6 7 6 7 10 20 14 14 11 11 8 Saxon Drilling BP Exploration F Agrium US Inc Weatherford US LP Fred Meyer Aix Energy LLC Miller Energy Resources, Inc 13 14 15 16 17 18 19 $25,171,630 $23,0661400 $19,0191712 $18,570,140 $17,840,560 $17,675,550 $16,603,760 13 12 13 9 5 18 17 13 9 15 20 19 12 10 Spartan Offshore Drilling LLC 20 $15,494,610 Kenai Offshore Ventures, LLC 8 9 Kenai Kachemak Pipeline 14 12 7 8 Armstrong Cook Inlet LLC Buccaneer Alaska, LLC Cook Inlet Pipeline Co Marathon Oil GCI Orion Offshore, Inc Unocal Phillips Gas Supply Co Kenai Pipeline Company Kenai Plaza Inc Tulin Charles E & Helen L Pacific Energy Resources Ltd r Rowan Drilling Co Inc ASRC Energy Services Inc Homer Spit Properties 16 15 17 19 14 17 12 4 3 4 16 11 15 18 1 2 15 13 16 17 18 10 16 18 19 20 Source: KPB Finance Dept. (values are based on KPB Certified Values for Tax Year at time of certification) ** includes, real, personal, and oil and gas assessments KPEDD 2016 Situations & Prospects — Page 22 • . r --MP 6101 4,0 OKI Or . f -` �•. ',` r T.- ,�F � ' KI. I °���: '.ram- . I'`�i j , 7 r S x P'lite, Op + f pit y " F r_- • � - • . - 4 _! �`#P �^ �r :'1:�T •. i.f y,�,• fir§ r CIF �.' `Y �1 •rr .f. _ � pf". - .y ,` �r�� Ly , �y s r#. r 'a. � F "r � # " �°' Y fit. ,�I ■a �`'+i rY 1 1. ... • • , Top: Sun sets behind Cook Inlet, as seen from the bluff overlook of Kenai's South Forest Street, Photo courtesy of Peninsula Clarion, by Ben Boettger. Bottom: Russian River Crossing on the Kenai River, Photo by Barbara Sheinberg KPEDD 2016 Situations & Prospects — Page 23 7 Road, Air, and Marine Travel and Freight The transportation of people and goods throughout the Kenai Peninsula is an indicator of commercial and industrial activity. Overall, the Kenai Peninsula saw a decrease of transportation activity across most modes in 2015. Air and ferry traffic declined, while vehicle traffic counts were mixed but down overall. Traffic at the "Y" and in Nikiski dropped in 2014 and 2015. Coal exports continued to decline. Marine freight through Seward grew by 23% between 2009 and 2011, but in 2013 (most recent data) declined to below 2009 levels. 7.1 Road Travel (Average Annual Daily Traffic AADT) The Alaska Department of Transportation and Public Facilities (ADOTPF) records the average number of vehicles per day (average annual daily traffic or AADT) at numerous locations on the Peninsula. Eight sites have been monitored by the Situations and Prospects Report as indicators of traffic through specific communities or areas (See Figure 22). Traffic in most locations has been slowly growing over the last five years. Small year over year increases are evident in places such as on the Kenai Spur Highway in the city of Kenai (line A, Figure 22), along the Sterling Highway in Soldotna (line C, Figure 22), at Moose Pass on the Sterling Highway (line E, Figure 22), or at the Placer River Bridge on the Seward Highway entering the Peninsula from the Anchorage area (line D, Figure 22). However, at the intersection of Kenai Spur Highway and the Sterling Highway, also called the "Soldotna Y" (line B. Figure 22), traffic dropped by 3,100 vehicles per day (on average) or 17% in 2015. This followed a 28% increase during the 10-years between 2004 to 2013 due to local commercial development and increased activity in Soldotna. Future traffic counts at this location will indicate if this one-year change was a data issue or if traffic is reduced due to the construction and oil and gas slowdown. The other recent decline occurred in Nikiski on the Kenai Spur Highway (line F, Figure 22), where traffic declined by an average of 500 vehicles per day on average or -14% between 2013 and 2015. Travel along the Kenai Spur Highway in Nikiski immediately spiked by over 1,300 average vehicles per day in 2012, following renewed investment in the oil and gas industry and the proposed LNG pipeline to a Nikiski gas liquefaction plant. By 2015 however, traffic along this highway segment had once again returned to levels similar to 2007. Busy intersection at the Kenai Spur Highway and Sterling Highway, Photo by Barbara Sheinberg KPEDD 2016 Situations & Prospects — Page 24 Figure 22 - Average Annual Daily Traffic, Select Kenai Peninsula Locations 20,000 111 16,000 14-4 14-4 If • F-' 14,000 Q 12,000 a) ac 10,000 111 4,000 0 J 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 B Soldotna - Sterling Hwy @ T13/400 KenaiSpur' 13 540 14120 16 634 16 900 16 650 18 085 18 650 18 275 15 168 r A Kenai - Kenai Spur Hwy 9,267 9,324 8,922 91157 9,449 91231 91218 91339 91587 9,587 i C Soldotna -Sterling Hwy @ Robinson Lp 8,212 81430 7,997 81352 81425 8,313 81314 81560 81819 8,881 -H Homer - Sterling Hwy 4,095 41125 3,840 31773 31874 31861 3,677 3,776 4,444 4,146 � D Placer River Bridge -Seward Hw y 4,110 3,842 3, 702 4,026 4,011 3,865 3,753 3,930 4,012 4,214 � --B F Nikiski - Kenai Spur Hwy 3,890 3,910 3,139 3,220 3,226 21418 3,747 3,800 3,270 3,281 G Anchor River -Sterling Hwy 2,641 2,611 21571 2,469 2,500 2,561 2,642 21715 2,467 21484 1,680 1,553 11572 11614 1,584 1,568 1,570 1,611 O E Moose Pass -Seward Hwy 11638 11555 KPEDD 2016 Situations & Prospects - Page 25 Matanuska Susjtna Borough Anchorage Kenai Peninsula Borough Kenai 00 Mt. Spurr Soldotna 0 Seward Homer 0 0 Seldovia 0� 100 Miles Beluga CDP Fad, lf4 Tyonek CDP 19,17. Point Possession CDP Opo Hope CDP Nikiski Ave Nikiski CDP Sunrise CDP -Salamatof CDP Cooper Landing CDP! Kenai Spur Hwy .,.Ridgeway CDP J_ Robinson Loop Rd Seward Hwy Sterling C P Moose Pass CDP City of Kenai Kalgan island Beaver Loop Rd/.,, { �- - Funny River CDP Kalifornsky CDP-"" Sterling Hwy Kas' lof CDP %City of Soldotna Crown Point CDP!'' Cohoe CDP Primrose CDP Bear Creek CDP---- Clam Gulch CDP,. City of Seward-----_-- 0 lop, Ninilchik CDP ""'Lowell Point CDP. Happy Valley CDP - Nikolaevsk CDP Fox River CDP Old Sterling Hwy Anchor Point CDP -Fritz Creek CDP--- N Diamond Ridge CDP KachemakCity rr City of Homer =g FAA Rd Source Data: US Census Bureau Qc/zernak 90"J -HalIbutCoveCDP Kenai Peninsula Borough State of Alaska Seldovia Village CDP USGS ADOT -City of Seldovia 20 Port Graham CDP Miles Nanwalek CDP _rx—}"Kenai Peninsula Borough -�-- -- -- -- -- -- -- --� DST Traffic Count Locations Alaska Map Company, LLC 7.2 Alaska Marine Highway System The Alaska Marine Highway Service provides state ferry service to Homer and Seldovia along the route to Prince William Sound, Kodiak Island, and the Aleutian Islands. In 2015, ferry service throughout the Marine Highway system was reduced by 26.2 weeks from 2014 levels to accommodate budget shortfalls. This reduction in port calls resulted in an overall reduction of 12% in disembarking passengers in Homer and Seldovia. With state budget concerns and service reductions continuing in 2016, this trend in reduced ferry service and ridership is likely to persist in coming years. Figure 23 - Number of Port Departures, Alaska Marine Highway System 350 300 250 v A 200 0 0 150 v 100 z 50 0 3 � 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 �+�Homer Seldovia Seward Figure 24 - Number of Disembarking (arriving) Passengers, Alaska Marine Highway System 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Homer Seldovia Seward Source: ADOT&PF, Alaska Marine Highway System Annual Reports KPEDD 2016 Situations & Prospects — Page 27 7.3 Marine Cargo The Seward Coal Loading Facility is at the southern terminus of the Alaska Railroad. It is the only facility in Alaska that can accommodate export of Usibelli coal. Shipments continued to decline in 2015 because the world market is becoming more competitive driving down the price of coal, higher calorie Indonesian coal was introduced into Japan causing Usibelli coal to lose significant market share, Chile has begun local sourcing its coal, and Korea instituted an import tax in the last year. The advantage of Usibelli coal is its low sulfur content; currently, Japanese buyers purchase small quantities to mix with Indonesian coal to meet emissions requirements. If downward trends continue, the Usibelli facility may go into cold storage until the market improves. Figure 25 - Coal, Metric Tons Delivered to Seward 11' 1 1 1 1 1'V 1 115 801,254 953,329 11083,757 871,935 574,755 465,079 124,000 Source: Alaska Railroad Corporation Seward is the Kenai Peninsula's main port hub. It is also the back-up port to Anchorage should a hazard close service in Anchorage at any time. Seward's strategic location on the Gulf of Alaska coupled with existing port, harbor, rail, and highway infrastructure make it an important regional maritime asset. From 2009 to 2013 (the most recent year for which data is available), the tons of goods received (inbound) at the Port of Seward increased from 13,649 tons to 48,055 tons, a 250% increase. Exports on the other hand have declined by 402,000 tons or 38% since 2011. In 2013, the tons of outbound freight were less than in 2009. Figure 26 - Port of Seward Cargo Traffic, Short Tons 1,200,000 1,000,000 800,000 c 600,000 400,000 200,000 0 � 2009 2010 2011 T 2012 2013 ■ Inbound 13,649 10,585 40,562 71,484 48,055 ❑ Outbound 889,937 948,796 1,072,634 893,026 670,486 Source: US Army Corps of Engineers Waterborne Commerce Statistics Center The City of Seward and the Alaska Railroad are working together to identify ways to increase freight volume and passenger use. This project, called Railport Seward, is funded by a $2.5 million TIGER grant and is analyzing traffic (ongoing), will develop alternatives (expected in August 2016), and a final master plan (early 2017). Multi - phased development could be expected to follow. The projects vision statement is, "Reimaging travel and trade to enhance economic vitality and increase opportunities in the region by balancing port, rail, and real estate to meet transportation demands." For Seward, studies suggest future trends will be mixed including slowing freight imports due to the downturn in the oil and gas and construction industries, continuing decline in coal exports, increasing fish exports, and increased passenger visitation. KPEDD 2016 Situations & Prospects — Page 28 7.4 Air Access In 2015, arrivals by airplane dropped in all communities on the Peninsula. Across the borough, air passenger arrivals dropped by 22% from 2014 to 2015 (Figure 27). This is a change from the past four years, when air traffic had remained relatively steady. Air freight saw steep declines in 2015, experiencing a drop of over 1 million pounds or 33% in 2015. While air freight fluctuates in each community from year to year contingent upon local projects, all communities have seen a trend of declining air freight shipments in the last year, with the largest decline percentage -wise in Beluga. Similarly, the number of pounds of air mail delivered on the Peninsula has fallen in half from 2011 to 2015, following a national trend of reduced mail volumes due in part to increased use of electronic communications. Commerce around the Kenai Municipal Airport, photo by Barbara Sheinberg KPEDD 2016 Situations & Prospects — Page 29 Figure 27 - Arriving (Deplaning) Air Passengers/Freight on the Kenai Peninsula AN& OEM 1 1 J 1 'o %•• BOROUGH TOTALS Air Passengers 142,566 146,719 144/181 144,680 1111004 -23% -22% Air Freight 4,626,607 41620,308 41935,609 31890,961 2,623,105 -33% -43% Air Mail 228,947 178,743 135,223 180,473 116,056 -36% -49% Beluga Air Passengers 31375 31266 21289 21673 1,487 -44% -56% Air Freight 11071,888 971,396 500,157 514/480 240,554 -53% -78% Air Mail 9,519 9,979 51266 12,036 31016 -75% -68% Homer Air Passengers 36,070 38,086 36,179 36,475 28,956 -21% -20% Air Freight 696,623 694,905 11322,397 767,228 726,106 -5% 4% Air Mail 32,074 20,214 18,376 19,715 61573 -67% -80% Kenai Air Passengers 90,775 92,863 94,478 94,333 71,790 -24% -21% Air Freight 1,401,360 1,415,967 1,418,710 1,682,795 1,143,308 -32% -18% Air Mail 13,480 9,184 8,395 10,537 51144 -51 % -62% Nanwalek Air Passengers 2,558 2,662 21391 21410 1,887 -22% -26% Air Freight 343,144 300,521 239,067 187,306 128,870 -31% -62% Air Mail 241711 16,549 15,941 22,213 15,199 -32% -38% Port Graham Air Passengers 21252 2,045 1,897 2,334 11891 -19% -16% Air Freight 335,167 344,881 301,742 207,020 137,410 -34% -59% Air Mail 42,819 34,989 22,386 31,304 25,752 -18% -40% Seldovia Air Passengers 41330 41215 31592 3,516 31186 -9% -26% Air Freight 198,550 136,651 113,764 72,963 48,924 -33% -75% Air Mail 85,117 72,892 48,609 73,305 50,709 -31% -40% Seward Air Passengers 14 5 3 10 3 -70% -79% Air Freight - - - - - Air Mail - - - - - Soldotna Air Passengers - 43 19 5 1 -80% N/A Air Freight - - 7,432 91635 51031 -48% N/A Air Mail - - - - - Tyonek Air Passengers 31192 31534 3,333 2,924 1,803 -38% -44% Air Freight 579,875 755,987 11032,340 449,534 192,902 -57% -67% Air Mail 211227 14,936 16,250 11,363 91663 -15% -54% Source: US Department of Transportation, Bureau of Transportation Statistics, T-100 Market Data KPEDD 2016 Situations & Prospects - Page 30 8 Regional and Personal Prosperity Personal income to Kenai Peninsula residents grew 6% between 2013 and 2014, has been increasing for over a decade, and continues to beat inflation. Between 2005 and 2014, inflation -adjusted Kenai Peninsula personal income grew by 32%. This exceeded the inflation -adjusted personal income growth of Anchorage (21%) and Alaska (23%) during this period. 8.1 Total Personal Income Total personal income, as measured by the US Bureau of Economic Analysis (BEA) is resident income only; 1t does not include income earned by non-resident workers in the Kenai region (such as non-resident oil and gas or seafood processing workers). Total personal income is the sum of all income that residents receive from these sources: • Work earnings, including wages, salaries and supplements as well as proprietors' income; • Dividends, interest and rent; and • Current transfer receipts, which includes Social Security and other retirement earnings (the largest component on the Peninsula), Medicare/Medicaid benefits, veterans' benefits, and unemployment insurance benefits. This category also includes Permanent Fund dividend payments. In 2014, total personal income on the Kenai Peninsula totaled $2,917,537,000. This was $177 million or 6% more than was earned by regional residents in 2013. Adjusted for inflation, growth in personal income was 5%. Figure 28 - Total Personal Income, Kenai Peninsula - Actual and Inflation Adjusted (2014 dollars) sources: BEA CA30 Economic Profiles, Anchorage CPlndex, Sheinberg Associates $3.50 $3.00 $2.50 $2.00 $1.50 $1.00 $0.50 $0.00 i Total personal income ($billions) 0 Inflation adjusted (2014 dollars, $billions) 2011 2012 $2.56 $2.72 $2.74 $2.85 2013 $2.74 $2.78 2014 $2.92 $2.92 KPEDD 2016 Situations & Prospects — Page 31 8.2 Sources of Total Personal Income According to the US Bureau of Economic Analysis (BEA), 64% of all personal income that Kenai Peninsula residents earned in 2014 came from work earnings;17% came from dividends, interest, and rent; and 19% came from transfer receipts (Figure 29). Looking at change over the last year (Figure 30) the amount of personal income coming from: • Work earnings was down 2% • Retirement income (the main component of current transfer receipts) grew by 3% or $90 million to 17% of the total • Unemployment insurance payments dropped by $7 million The increase in retirement income is likely due to the aging demographics on the Kenai (and elsewhere in Alaska) as baby boomers begin to retire. It could also be due to an increased number of retired individuals moving to the region. The economic opportunity and challenge is to provide as many ways as possible for retirement earnings to be spent and invested locally. Figure 29 - Sources of Kenai Peninsula Resident Income, 2014 Dividends, interest, & rent, $496,656100( Personal current transfer receipts, $549,298, 000 -zz Source: BEA CA30 Economic Resident work earnings, $11871,5831 000 I Figure 30 - Change in Sources of Personal Income, Kenai Peninsula Residents $1,800,000,000 $11600,0001000 $1,400,000,000 0 w $1,20010001000 0 U $1,000,000,000 U $800,000,000 $600,000,000 $400,000,000 u, $200,000,000 2010 2011 2012 2013 2014 + L- Work earnings $115271696,00 $11632,153,00 $1,739,932,00 $1,794,730100 $1,871,583,00 • • • • . SSI, SNAP, child tax credit, etc $491758,000 $54,407,000 $154,492,000 $54,295,000 $53,555,000 Unemployment insurance $25,150,000 $24,324,000 $20,754,000 $1711311000 $10f0551000 Retirement and other $3821353,000 $3931691,000 $3841431,000 $395,560,000 $485,6881000 Dividends, interest, and rent $379,652,000 $451,237,000 $519,056,000 $478,179,000 $496,6561000 KPEDD 2016 Situations & Prospects - Page 32 8.3 Per Capita and Household Income Per capita personal income on the Kenai Peninsula in 2014 was $50,760, an increase of 6% over 2013 (BEA). This is computed by dividing total personal income by Kenai Peninsula's total population. Per capita income in the Kenai Peninsula in 2014 was 6% below Alaska as a whole ($54,012), and 10% above the US per capita income ($46,049). Figure 31- Per Capita Income, 2013 and 2014 (and percent change) Alaska $51,259 $54,012 5% Matanuska-Susitna Borough Nome CA North Slope Borough $42,683 $41,559 $32,340 $44,820 $44,413 $34,061 Aleutians East Borough $35,272 $36,946 5% Aleutians West CA $50,081 $53,010 6% Anchorage Municipality $58,001 $61,134 5% Northwest Arctic Borough $42,014 $44,965 Bethel CA Bristol Bay Borough g $35,243 $56 600 $37,075 $59 603 5% 5% Petersburg Borough Prince of Wales-H der CA y $55,272 $35 940 $58,426 _ $37 684 , Denali Borough $57,079 $64,631 13% Sitka City and Borough $57,225 $61,204 Skagway Municipality $74,312 $771937 Dillingham CA $46,947 $50,212 7% Southeast Fairbanks CA Valdez -Cordova CA $37,692 $52,559 $39,605 $56,571 Fairbanks North Star Borough $49,079 $51,792 6% Haines Borough $74,742 $78,115 5% Hoonah-Angoon CA $45,863 $49,585 8% Wade Ham ton CA $26,491 $28,762 _ Juneau City and Borough $54,855 $57,033 4% Wrangell City and Borough $39,855 $43,230 Kenai Peninsula Borough $48,012 $50,760 6% Yakutat City and Borough $44,877 $45,364 Ketchikan Gateway Borough $55,730 $57,876 4% Yukon -Koyukuk CA $52,370 $54,323 Kodiak Island Borough $50,697 $53,792 6% United States $44,348 $46,049 Lake and Peninsula Borough $44,087 $46,787 6% CA= Census Area Source: Bureau of Economic Analysis, CAI Personal Income Summary NOTE: 2013 data is slightly different from reported in 2015 S&P because each year BEA data is refined for previous years as late filer information is added. 5% 7% 5% 7% 6% 5% 7% 5% 5% 8% 9% 8% 1% 4% 4% Household income is not available from the BEA. It is available from the US Census Bureau's 5-year (2010-2014) American Community Survey (ACS). According to the ACS, the Kenai Peninsula Borough's median household income was $63,099. This compares with the Alaska's median household income of $71,829 and $53,482 for the US. The ACS also reviews household income by income category (Figure 32), showing that 27% of Kenai Peninsula households make $100,000 or more while 19% make $25,000 or less. Figure 32 - Number of Households by Median Income Level Less than $10,000 961 $10,000 to $14,999 1,099 $15,000 to $24,999 11951 $25,000 to $34,999 11932 $35,000 to $49,999 2,447 $50,000 to $74,999 4,238 $75,000 to $99,999 3,110 $100,000 to $149,999 31669 $150,000 to $199,999 11363 $200,000 or more 789 -� Source: ACS 2010-2014 5-Year Survey KPEDD 2016 Situations & Prospects - Page 33 8.4 Poverty Indicators Some on the Kenai Peninsula are struggling financially and having a hard time making ends meet; several indicators are of concern. Figure 33 - Economic Hardship Indictators, Kenai Peninsula Residents below Poverty 9.1% 9.3% Families below Poverty 5.6% 5.8% Families headed by a female with no make below poverty 16.1% 16.9% Households receiving Food Stamps/SNAP 9.2% 8.2% Households receiving Food Stamps/SNAP 11978 111762 Source: US Census ACS 2010-2014 5-Year Survey Approximately 9% of Kenai Peninsula Borough residents and 5.8% of Kenai Peninsula Borough families have an income below federal poverty limits. For example, this is $14,840 for an individual or $30,380 for a family of four. In addition, 16.9% of families headed by a female with no male present live in poverty. There were 1,762 households (plus or minus 229) or 8% of all Kenai Peninsula Borough households that received Food Stamps/SNAP in the past 12 months, according to the most recent data available (ACS 2010- 2014 Survey). The percent of students qualifying for a free or reduced lunch went down 1 % in Alaska as a whole during academic year 2015/2016 (Figure 34). In Kenai Peninsula Schools the percent qualifying was 38%, unchanged from the previous year. Today, 2,925 or 38% of the Kenai region's students live in a family that qualifies for free or reduced fee school lunch. Most (80%) qualify for a free lunch. Those earning less than 130% of the federal poverty limit (FPL) qualify to receive a free lunch and those earning up to 185% of the FPL qualify for a reduced fee lunch. Using the January 2016 federal poverty thresholds in Alaska, this would mean that for example, students from a family of four that made less than $39,494 received a free lunch, or those earning less than $56,203 got a reduced fee lunch. For a single parent with one child, annual income limits to qualify for a free lunch were $26,026 or $37,037 for a reduced fee lunch. Figure 34 - Number (and %) of Students Qualifying for Free or Reduced Fee Lunches, by School Year mm, M VqWr MIMW Kenai Peninsula Schools 3,228 (42%) 21923 (39%) 21992 (38%) 21925 (38%) Anchorage Schools 19,363 (38%) 22,898 (46%) 21,558 (47%) 21,352 (47%) Mat Su Schools 51550 (37%) 5,868 (39%) 61185 (41%) 61503 (40%) Alaska Schools statewide 50,203 (42%) 56,383 (47%) 57,915 (50%) 56,891 (49%) Source: Alaska DEED Child Nutrition Services Free & Reduced Program Reports KPEDD 2016 Situations & Prospects - Page 34 9 Business Prosperity 9.1 Innovation and Entrepreneurship - Profiles on the Kenai Peninsula The Kenai Peninsula enjoys many economic advantages that make it an ideal location for innovators and entrepreneurs: a high quality of life that attracts location neutral workers, access to natural resources, a moderate coastal climate, state of the art workforce training facilities, and good access by road, air, and water. All of these assets combine to foster a creative, entrepreneurial culture. Four profiles are offered in the 2016 Situations & Prospects that highlight unique workforce training, people, and businesses doing new things in creative ways on the Peninsula. Small businesses are the backbone of the economy; these entrepreneurs create and sustain jobs one and two at a time and inspire others around them with new ways of doing. The four spotlighted here are but a sample of this type of activity and energy on the Kenai Peninsula: • New Agricultural Exports: Anchor Point Greenhouse • Entrepreneurs and Tech Start-ups: K2 Dronotics • Maritime Workforce Training: The AVTEC Alaska Maritime Training Center • Alternative Energy: Alaska SeaLife Center Collection of rock concretions from Cook Inlet beaches on display at Kenai Chamber of Commerce and Visitor's Center, Photo by Sarah Bronstein KPEDD 2016 Situations & Prospects — Page 35 New Agricultural Exports: Anchor Point Greenhouse According to the USDA's Agricultural Census, the number of farms on the Kenai Peninsula increased by 65% over the ten-year period from 2002 to 2012. Many of these new farms are small operations run by entrepreneurs attracted by the potential of new export crops such as peonies and rhodiola rosea that flourish in Alaskan growing conditions. Rhodiola rosea is a hardy root with a large market among herbalists in China and Scandinavia. Currently, most of the world's supply is wild harvested from China and Russia. In Russia, wild stocks have been so over -harvested that the plant has been listed as endangered. Twelve farmers are now cultivating the plant on the Kenai Peninsula, where it thrives in Alaska's cool short growing season. Although the existing cultivation of the crop is small, if Alaskan growers can scale up their production they anticipate a waiting and enthusiastic market for their product. The recently formed Alaska Rhodiola Products Cooperative has a standing order from the Swedish Herbal Institute for 50 tons of dried rhodiola root per year. Anchor Point Greenhouse, has begun growing starts and Newly planted Rhodiola Rosea at Anchor Point Greenhouse. Pictured Left to Right: Al Poindexter, Professor Mahtab Jafari, Dr. Petra Illig Picture: Dr. Petra Illig recruiting new growers, with the goal of eventually building a 50 acre, 2.5 million dollar export crop on the Peninsula. Dehydrated chips sell for $20 per pound, and an acre can yield approximately $20,000 in chips annually. In 2015, Anchor Point Greenhouse sold 55,000 rhodiola seedlings, and has orders for 80,000 seedlings in 2016, with an estimated demand for 200,000 seedlings in 2017. If this projected growth comes to fruition, it will require the construction of new regional processing facility to wash, slice, and dry rhodiola chips in preparation for sale. Developing a locally produced capsule form would lead to even more value added. If Alaska -grown rhodiola is successful, this would more than double the existing $2.1 million agriculture industry on the Peninsula. Very little research is available about rhodiola cultivation in Alaska, and growers are taking on the role of innovators, trying new growing methods. Thanks to their innovation and entrepreneurship, rhodiola could become a new and unexpected contributor to the Kenai Peninsula's economy. Rhodiola is well suited to cold climates and short growing seasons like those on the Kenai Peninsula. Picture: Petra Illig KPEDD 2016 Situations & Prospects — Page 36 Entrepreneurs and Tech Start-ups: K2 Dronotics The mix of access to wilderness and proximity to business development resources in nearby Anchorage makes the Kenai Peninsula a desirable location for entrepreneurs. Proximity of surrounding wilderness was a primary reason that K2 Dronotics founders Ben and Nick Kellie chose their native Kenai as the location to start their business. The Kenai Peninsula offers adventure and open spaces right out the back door, a lifestyle that drew Ben back to Kenai after three years working for a California -based aeronautics company, SpaceX. For K2 Dronotics, bringing new technology for remote sensing to Alaska is also a story of equity and access. Because drones are so much cheaper to operate than traditional manned aircraft, they make information collection affordable for small remote communities with fewer resources. The challenges inherent to living and working in remote areas provide new opportunities for innovation and entrepreneurship on the Kenai Peninsula. K2 Dronotics is a new Kenai -based startup that deploys small UAVs (better known as drones) to conduct remote data collection for industry clients and rural Alaskan communities. These flying drones can be used to do everything from infrastructure inspections in hard to reach or dangerous areas to creating maps and 3D models of remote facilities or geographical areas of interest. By flying smaller drone models, K2 Dronotics keeps costs lower and can quickly deploy in remote regions. For example, drones can be modified and improved to work in arctic and remote conditions, or to perform specialized work such as collecting polluted ground water or other scientific samples. Top: K2 Dronotics uses drones to collect digital information in remote locations for less than the cost of manned aircraft. Photo: K2 Dronotics Bottom: The Kenai Peninsula's surrounding wilderness is both a professional challenge and a -nPrcnrnal draw fn P-n rPnrwnP-rrrc Nirlc and Rion KPEDD 2016 Situations & Prospects - Page 32 Innovation Spotlight - Maritime Workforce Training: The AVTEC Alaska Maritime Training Center The Kenai Peninsula benefits from workforce training institutions that prepare Alaskans to work in local industries. One of these is the AVTEC Alaska Maritime Training Center (AMTC), a nationally accredited United States Coast Guard Approved Maritime Training School in Seward, Alaska. The mission of the Alaska Maritime Training Center is to provide Alaskans with the skills and technical knowledge to support the state's continually evolving and challenging maritime industry. Programs such as the Alaska Marine Training Center give the Kenai Peninsula a strategic edge in the maritime industry by providing cutting edge workforce training that attracts students from throughout Alaska and beyond. Currently, AVTEC's AMTC has 35 US Coast Guard and FCC approved courses. Without this approved curriculum, many Alaskan mariners would have to travel outside the state for advanced training. The training center operates Alaska's only Full Mission Bridge Simulator, made up of three separate ship bridges that communicate with each other and with instructors in a control room. Thanks to frequent software updates, the system can simulate every major port and harbor in the state, over 40 different vessels, and a variety of adverse environmental conditions. The simulator provides a The AVTEC Full Mission Bridge simulator attracts maritime professionals from around the country to Seward for advanced training. Photo: highly realistic ship navigation training experience (some facility users have even claimed seasickness after use of the simulator!) and has been utilized by international, federal, state, and local agencies, as well as the private sector for critical maritime training. The simulator plays a crucial role in research and development of port and harbor planning associated with Arctic infrastructure and oil & gas development, and is frequently used to test viability of Alaskan port projects. The AVTEC AMTC recently contracted with the AKLNG (Alaska Liquid Natural Gas) Partners to run simulations. Training requirements imposed on the maritime industry by the United States Coast Guard have posed new challenges and training opportunities for AVTEC. For example, beginning in January of 2017 all large vessels of 500 tons or greater operating north of 60 degrees latitude must have a crewmember aboard with an ice navigation certification. The Alaska Maritime Training Center developed the nation's first ice navigation certification course to meet this requirement, a course that has attracted students from across the country. AVTEC anticipates an increase in enrollment in their Maritime Training program as experienced mariners, public agencies, and businesses operating in arctic waters work to meet these new workforce training standards. Alternative Energy: Alaska SeaLife Center Thanks to the innovative leadership of the Alaska SeaLife Center in Seward, the Peninsula is becoming a national leader in utilizing the ocean as an energy source. In 2012, the Alaska SeaLife Center installed a sea water heat pump system, which collects heat from the waters of Resurrection Bay to heat the facility's buildings and de-ice sidewalks. Seawater heat pump technology is not new, and has been widely adopted in Norway and Sweden. However, at the time of installation only one other seawater heat pump was installed in the United States, at the Ted Stevens Marine Research Institute in Juneau. The Alaska SeaLife Center was uniquely positioned to install this innovative technology. The aquarium sits right on the edge of Resurrection Bay, an ice free water body that stores solar heat throughout the summer, reaching high temperatures of 50 degrees Fahrenheit. The center was using an average of 130,000 gallons of heating fuel per year, with annual utility costs of $1.2 million. In an attempt to reduce fuel use and save on operating costs, the SeaLife Center worked with an Anchorage -based energy consulting firm to design and build a seawater - sourced heat pump system. The system uses electricity to cycle ocean water from Resurrection Bay through a heat exchanger, heating freshwater to 100-120 degrees Fahrenheit to cycle through the building. In 2013, the center began operating the new pumps, and immediately cut their energy bills in half. In February of 2016, the Center completed the installation of two additional pumps, covering domestic hot water demand and effectively eliminating the need to run the oil -fueled boiler as a winter backup. Thanks in part to the success of the SeaLife Center, the City of Seward is now considering adding an energy chapter to its new comprehensive plan. The project has catalyzed a community discussion about the possibility of a seawater heat pump district heating system. Heat Pumps at the SeaLife Center collect residual heat from ocean water in Resurrection Bay. The heat from this source has now replaced oil -fueled boilers entirely at the aquarium. Pictured Left to Right: Special Projects Director Darryl Schaefermeyer, President and CEO Tara Riemer, and YourCleanEnergy consultant Andy Baker. Photo: Alaska SeaLife Center 9.2 The Whole Work Economy (Employment +Self -Employed Business Owners) About this Combined Dataset Wage and employment data from the Alaska Department of Labor and Workforce Development (ADOLWD) Quarterly Census on Employment and Wages (QCEW) is the most common dataset used in Alaska to understand economic activity. However, this important dataset does not include earnings or a count of those who are self-employed (like most commercial fishermen) or those who own their own small businesses (sole proprietors). Data on these individuals is available through the US Census Nonemployer Statistics database, which is based on US tax returns. Matching NAICS codes from these two data sources and aggregating them provides a more complete picture of the whole economy than either data set does alone. The availability of Nonemployer Statistics lags QCEW data by one year. Thus the 2016 Situations &Prospects (S&P) combines 2015 QCEW data with 2014 Nonemployer data; it is common to do this to understand the whole work economy, but remember that it is blending data for two years. When a time series does this consistently it provides a meaningful review of both totals and trends. Note that the 2015 Situations and Prospects (S&P) was published a month before the most recent years' data was issued; it reported on 2013 QCEW data and 2012 Nonemployer data. The 2016 S&P thus advances reporting on and understanding of the regional economy by TWO years compared to data reported in the 2015 S&P. Highlights Together, employment and self-employed business data shows that direct work earnings on the Kenai Peninsula totaled $1.28 billion in 2015, an increase of $30 million over 2014, and an increase of $52 million from 2013 (Figure 35). A review of the top five sectors in 2015, as measured by earnings, shows some economic shifts occurring: • Construction slipped out of the top five sectors producing work income Mining, oil & gas slipped from 2nd to 3rd place as oil and gas work slows down (in 2013 it was in 1st place). • Retail trade entered the top 5, trading places with construction which is now ranked 6th. The combined workforce is 26,940 including 24% who are self-employed small business owners and 76% who are wage and salary workers, employed by 2,055 firms on the Peninsula. The total workforce is identical to that of 2014; however, in 2015 there are 380 fewer wage and salary workers and 380 more self-employed small business owners. Figure 35 - Workforce and Earnings Summary, Kenai Peninsula 1_rr L 1 2015 A Change 2014-2015- Number of employees 20,782 20,400 -382 -2% Number of of self-employed small businesses II _ 6,160 �I 6,543 383 6% iF I — Combined total Amount of employee wages Amount of self-employed business receipts Combined total 26,942 261940 -2 0% $9721205,459 $986,023,133 $13,817,674 1% $280,8681000 $297,232,000 $16,364,000 6% $1,253,0731458 $11283,229,133 $301155,675 2% Sources: ADOLWD QCEW 2014 -2015, US Census Nonemployer Statistics, 2013-2014 KPEDD 2016 Situations & Prospects — Page 36 Figure 36 - Sources of All Work Income (employment + self-employed) on the Kenai Peninsula, 2015 2/° ° 5% Federal / State employment employment 230 Private small t2o/ business Local owners 1 The Earnings Mix government employment Sources: ADOLWD QCEW 2015; US Census Nonemployer Statistics, 2014 Figure 37 - Full Workforce (employment + self-employed) on the Kenai Peninsula, 2015 1% 7*__� Federal 24% Private small Of all work -related earnings coming to residents on the Kenai Peninsula in 2015: 5% State 12% Local '*"��overnment (Cities, KPB, Cl chools, Cribes, ospital) • Almost one-third (32%) was from goods -producing work (oil and gas, commercial fishing, construction, and manufacturing) • Almost half of total work earnings (48%) were from service -providing work, primarily businesses serving visitors, professional services, retail trade, and health care and social assistance • 20% of earnings were from government services, primarily local government, which includes school district staff, all city and borough employees, tribal government employees, and many hospital and clinic workers on the Peninsula. • This mix hasn't changed much during the last three years. Top 5 Sectors: Workforce (Employees +Self -Employed) The top five sectors producing jobs have been the same for the last three years. The number engaged in agriculture, forestry, fishing, and hunting work is up by 110 small business owners compared to last year, presumably more commercial fishermen. The number of jobs in the top five sectors is 14,430, which is 54% of the Kenai Peninsula workforce. KPEDD 2016 Situations & Prospects - Page 37 Figure 38 - Number of Jobs — Top 5 Sectors (Employees + Self-empl' =_oyed) Pr p9pw AI1 1 1 12014/2015 411M1 1. 1 1. 1 1. 1 1 1 1 Health care & social assistance 1 31500 (13%) 1 31506 (13%) 1 31467 (13%) Local government 2 31209 (12%) 2 31259 (12%) 2 31247 (12%) Retail trade 3 21970 (11%) 3 3,046 (11%) 3 3,160 (12%) Accommodation and food services 4 2,587 (10%) 4 2,596 (10%) 4 203 (10%) Agriculture, forestry, fishing, hunting 5 11662 (6 /°) 5 1,762 (7 /°) 5 1,873 (7 /o) Sources: US Census Nonemployer Statistics 2012-2014; ADOLWD QCEW 2015-2013 Top 5 Sectors: Earnings (Wages +Earnings of Self -Employed) In 2015, construction slipped out of the top five sectors for work income. Mining, oil & gas slipped from 2nd to 3rd place as oil and gas work slows down. Retail trade entered the top 5, trading places with construction which is now ranked 6th. Like 2014, local government, is still tanked 1St, providing 13% of all wages on the Peninsula. Total work earnings in 2015 were $1,283,255,133; up $30 million over 2014. For agriculture, forestry, fishing, and hunting, $4.3 million in wages came to employees while $103 million were receipts to small business owners. Figure 39 - Total Work Earnings — Top 5 Sectors (Wages + Earnings of Self-employed) in, =I rllffxlvw&�� Sector Total• 1 • 1Earnings i 1 1 � of all) L.Local government 2 $154,061,321 (13%) 1 $160,070,395 (13%) 1 $165,407,149 (13%) Health care & social assistance 3 $1311421,142 (11%) 3 $1331126,869 (11%) 2 $142,381,538 (11%) Mining, quarrying, oil & gas 1 $154,348,885 (13%) 2 $143,728,309 (11%) 3 $135,391,570 (11%) extraction Agriculture, forestry, fishing, ° ° ° hunting 4 $102,457,251 (8 /°) 4 $108,968,180 (9 /°) 4 $107,075,823 (8 /°) i g Retail trade 5 $96/794/611 (8%) Construction 5 $93,299,715 (8%) 5 $99,846,499 (8%) Sources: US Census Nonemployer Statistics 2012-2014; ADOLWD QCEW 2013-2015 Liquid Natural Gas tanker Excel at Conoco Phillips facility in Kenai. Photo courtesy of Peninsula Clarion, by Rashah McChesney KPEDD 2016 Situations & Prospects — Page 38 9.3 A Deeper Look at 2015 Employment and Wages on the Peninsula' Total employment wages on the Kenai Peninsula in 2015 was $968 million; this is up 1% or $13.8 million. Average monthly wages on the Kenai Peninsula are highest for employees in mining (oil and gas); utilities; management of companies; and the federal government (Figure 39). Wages are lowest for those working in arts, entertainment and recreation; accommodations and food services; unclassified work; and those providing education services (private sector). Figure 40 - 2015 Average Monthly Employment and Wages by Industry, Kenai Peninsula Mining, Oil & Gas 1,017 Utilities -1 239 Mgmt. of Companies & Enterprises Federal Government Manufacturing Construction 1 1 Wholesale Trade 22 Real Estate, Rental and Leasing Finance and Insurance 2 State Government56 1 29 Professional, Scientific, Tech.L7.2 1 32 355 938 W $9,258 Local Government 3.247 Average Monthly Wage KIM on Kenai Peninsula ($4,028 ) Transportation and Warehousin----------------------------------- A,� - -------- g 91 Ag, Forestry, Fishing, Hunting 1 Information 2 Health Care and Social Assistance "1194 Administrative and Waste Services 238 Retail Trade 21689 ❑ Average Monthly Employment Other Services Educational Services Unclassified Accommodation and Food Services Arts, Entertainment and Recreation average Monthly Wages Source: ADOLWD QCEW 2015 1 The last section of this chapter on The Whole Economy looked at combined data from employed wage and salary workers as well as that from self-employed business proprietors. This section looks only at employment and wage data provided by ADOLWD Quarterly Census on Employment and Wages (QCEW). This is the most often reported employment information and it is possible to "drill -down" and get a lot of detailed information at the borough -level. KPEDD 2016 Situations & Prospects — Page 39 job Growth has been in Lower -Wage Service -Providing Jobs Looking just at ADOLWD employment and wage data (excluding self-employment businesses and income): • The number of average annual employees on the Peninsula in 2015 declined by 380 workers. • Job growth over the last five years had a net gain of 963 jobs (between 2011-2015). • Job growth has primarily been in the private sector. • The line on Figure 41 shows average monthly wages in 2015. It indicates that high growth service - providing jobs have lower average wages than other types of work. • Over the last five years, the numbers of high paying goods -producing jobs and federal government jobs have declined by 47 and 51 jobs, respectively (Figure 41). Figure 41- Kenai Peninsula 5-Year Change in Employment (2011-2015) and 2015 Monthly Wages 1,000 932 $8,000 :11 1.0 •° 600 0 a� 400 an 200 0 Federal Govt -51 -200 $7,000 $6,000 Ln N $5,000 $4,000 ►� 0 $3,000 166 $2,000 State Govt Local Govt Private -Goods Private -Service $1,000 -37 Producing Providing 47 $0 KPEDD 2016 Situations & Prospects — Page 40 9.4 Resident -Nonresident Workforce Given that all the industries cited by the state below are significant in the Kenai Peninsula, it is surprising that only 21% of all workers in the Kenai Peninsula Borough are nonresidents, according to ADOLWD. ADOLWD occupational data and analysis show that in 2014, an estimated 24% of Alaska's private sector workers were nonresidents (Kreiger, K., et. al. ADOLWD, Research and Analysis Section. Nonresidents Working in Alaska: 2014). Statewide, the Seafood Processing industry was the largest employer of nonresidents. Nonresident percentages were also high in Leisure and Hospitality and Trade, Transportation, and Utilities industries. The nonresident workforce for these three industries combined represented more than half, or 54.3%, of all nonresident workers in 2014. Other industries with high percentages of nonresidents included oil and gas, construction, metal mining, and other visitor -related industries. These industries generally have one or more of the following: high seasonality, a need for specialized skills, or remote work sites. Figure 42 - Worker Residency by Borough or Census Area, 2014 Kusilvak Census Area Matanuska-Susitna Borough Fairbanks North Star Borough Nome Census Area Anchorage Municipality Bethel Census Area Juneau, City and Borough Kenai Peninsula Borough Yukon -Koyukuk Census Area Yakutat, City And Borough Kodiak Island Borough g Northwest Arctic Borough Prince of Wales-Hyder Census Area Hoonah-Angoon Census Area Sitka, City and Borough Ketchikan Gateway Borough Southeast Fairbanks Census Area Dillingham Census Area Haines Borough Wrangell, City and Borough Valdez -Cordova Census Area Petersburg Borough Aleutians West Census Area Lake and Peninsula Borough Skagway Municipality Denali Borough North Slope Borough Aleutians East Borough 234 3,492 7,454 863 23,305 1,114 3,810 6,232 412 90 2,328 750 1,000 258 1,733 2,461 518 1, 345 581 546 2,863 919 21789 867 998 2,591 7,771 3,510 Bristol Bay Borough 1 11% 405 410 1 2,807 Unknown, Offshore, or Outside AK 0% 0 11,748 Source: ADOLWD, Kreiger, K. et.al. Nonresident Working in Alaska, 2014 84% 2,980 321 78% 23,068 21991 77% 34,760 21799 75% 41407 615 75% 128,166 19,552 75% 71942 11597 74% 15,966 11716 71% 21,137 2,224 68% 21441 719 68% 280 41 551 66% 51674 66% 2,921 772 66% 21380 253 65% 698 111 65% 31796 324 975 64% 61133 57% 11789 855 55% 21096 383 54% 848 131 52% 764 168 871 51% 3,846 o 50 /0 11082 149 40% 21113 376 38% 676 230 30% 483 139 17% 648 641 16% 31433 111015 15% 691 328 4,247 3,535 29,551 45,013 5,885 171, 023 10,653 21,492 29,593 3,572 411 8,553 4,443 3,633 1,067 5,853 9,569 3,162 3,824 1,560 1,478 7,580 i 2,150 5,278 1, 773 1,620 3,880 22,219 4,529 3,622 5,995 KPEDD 2016 Situations & Prospects - Page 41 9.5 Kenai Peninsula Business Activity (Taxable and Gross Sales) Taxable Business Sales (Figure 43) Total taxable sales in 2015 on the Kenai Peninsula were $1,024,252,931, down by 1% or $12 million since 2014. Lines of businesses with the largest decline in taxable sales (with the size of decline in parentheses) were: • Retail Trade (-$19 million) • Information (-$5.6 million) • Mining, Quarrying, Oil & Gas (-$2.45 million) Three out of four of the lines of business with the highest increased taxable sales were in tourism, including: • Guiding Water (+$4.8 million) • Hotel/Motel/Bed & Breakfasts (+$4.2 million) • Utilities (+$3.8 million) • Restaurants/Bars (+$3.6 million) Gross Business Sales (Figures 43 and 44) While taxable sales are critical to provide revenue to run local and borough government, they are not a good indicator of business activity because of the various sales tax exemptions in place. Gross business sales are a very good proxy for business activity and investment. Gross business sales dropped 14% between 2014 and 2015, from $4.33 billion to $3.75 billion. For perspective, gross sales activity on the Peninsula in 2015 was essentially the same as in 2013. Businesses with the largest drop in gross sales in 2015 (with the size of decline in parentheses) were: • Mining, Quarrying, Oil & Gas (-$432.0 million) • Professional, Scientific, and Technical Services (-$57.8 million) • Wholesale Trade (-$44.5 million) • Retail Trade (-$43.5 million) • Services (-$19.8 million) Lines of business with the highest increased gross sales were: • Utilities (+$13.7 million) • Fire & Insurance (+$7.2 million) • Rental Residential Property (+$5.6 million) • Guiding Water (+$5.7 million) Despite the overall decline in gross sales activity on the Peninsula between 2014 and 2015, business sales grew in the cities of Kenai and Soldotna over the last year. There was a decline in business activity in Homer, Seward, Seldovia, and in places outside of cities. KPEDD 2016 Situations & Prospects — Page 42 Figure 43 - Taxable Sales by Type of Business, Kenai Peninsula Borough, by Year •.i Ad lip Changilso • .• s 1 1 1 1 Admin, Waste Management $10,041,226 $10,0091812 $9,367,87611 -$641,936 $132,543 Ag, Forestry, Fishing, Hunting $2,027,171 Arts & Entertainment $4,712,293 Construction Contracting $12,334,522 Educational Svs $11667,194 Financial & Insurance $1,374,245 Guiding Land $1,7901807 Guiding Water $48,211,422 Health Care, Social Assistance $1,7471100 Hotel/Motel/B&B $751549,517 Information $44,698,273 Management of Companies Manufacturing Mining/Quarrying, Oil & Gas Prof, Scientific & Technical Svs Public Admin Remediation Svs Rental Commercial Property Rental Non -Residential Property Rental Self -storage & Mini - warehouses Rental Personal Property Rental Residential Property Restaurant/Bar Retail Trade Services Telecommunications Timbering Trailer Court Transportation, Warehousing Utilities Wholesale Trade TOTAL $9,266,357 $7,650,051 $15,986,117 $17,290,842 $523,247 $2,166,046 $8,482,963 $2,454,094 $2,733,591 $11781, 254 $5,389,546 $12,610,057 $1,906,035 $1,362,225 $1,853,241 $47, 694,152 $2,169,088 $79,914,340 $42,443,863 $9,089,588 $ 8,164, 765 $15,774,869 $17,2861348 $466,718 $21261,534 $9,155,933 $2,517,592 $2,698,532 $22,579,038 $23,216,703 $85,303,841 $89,295,781 $492,2101171 $498,485,589 $35,428,030 $361975,592 $10,998,660 $10,513,808 $10,735 $4,215,629 $64,581,694 $8,670 $4,523,595 $70,377,823 $I f878,463 $5,525,310 $121011,211 $I f837,191 $1,370,257 $1,912,836 $521489,425 $2,226,289 $84,148,303 $36,828,675 $8,953,337 $5,710/511 $16,047,264 $18,362,550 $239,534 $2,355,403 $9,230,116 $2, 630,122 $2,577,421 $24,3011019 $92,932,653 $4791301,206 $35,972,220 $10,602,669 $4,084,949 $74,139,630 $31,831,157 $28,660,420 $271216,491 $1,017,866,033 $1,0361607,473 $1,024,252,931 change from year before 2 % 2 % -1 % $97/209 -$184,635 $135,764 $811,334 -$598,846 -$707,831 -$68,844 $312,898 $8,032 $237,003 $59,595 $632,342 $4,795,273 $7,6181306 $57,201 $677,846 $4,233,963 $16,052,910 -$51615,188 -$9,315,530 -$136,251 $128,474 -$2,454,254 $1,522,260 $272,395 $1,560,859 $11076,202 $2,7041864 -$227,184 $150,374 $93,869 -$341172 $74,183 $1,083,412 $112,530 $620,933 -$121,111 -$358,730 $1,084,316 $3,717,055 $3,636,872 $15,835,264 -$19,184,383 $4,109,644 -$1,003,372 $4,801,454 $88,861 $3911283 -$438,646 -$1,361,387 $3,761,807 $9,988,658 -$1,443,929 -$1,298,984 -$12,354,541 $59,819,157 -1% 6% (5-Yr change) Source: Kenai Peninsula Borough Finance Department, Sales Tax Division confidential KPEDD 2016 Situations & Prospects - Page 43 Figure 44 - Business Activity - Gross Sales by Type of Business, Kenai Peninsula Borou 1 1 1 • Business p, 1 1 by Year Admin, Waste Management $811561,362 $71,578,140 $62,472,337 -$9,105,803 Ag, Forestry, Fishing, Hunting $3,259,614 $3,054,311 $31417,660 $363,349 Arts & Entertainment $15,377,847 $7,070,683 $7,205,880 $135,197 Construction Contracting $566,348,085 $492,129,671 $484,427,149 -$7,702,522 Educational Svs $2,945,892 $3,487,518 $3,133,731 -$353,787 Financial & Insurance $10,033,276 $8,200,402 $15,433,738 Guiding Land Guiding Water Health Care, Social Assistance Hotel/Motel/B&B Information Management of Companies Manufacturing Mining/Quarrying (Oil & Gas)** Prof, Scientific & Technical Svs Public Admin Remediation Svs _Rental Commercial Property " Rental Non -Residential Property Rental Self -storage & Mini - warehouses Rental Personal Property Rental Residential Property Restaurant/Bar Retail Trade Services Telecommunications Timbering Trailer Court [Transportation, Warehousing Utilities Wholesale Trade TOTAL r change from year before $2,701,107 $2,954,865 �)bU,Jbb,�/� $20,369,553 $88,861,805 $55,491,122 $591567,601 $34,155,336 $91,180,202 (Z�'z 'zaa 71a �)Jf6UU,144 $127,020,578 $3,382,241 $65,036,445 $36,509,660 $95,864,781 $47,656,939 $7,233,336 $427,376 $5,468,844 $2,354,324 $4,684,579 -$5,742,800 -$19,085,189 -$6,342 -$7,332,812 -$81,456,459 $685,394 $7,605,134 $1,665,572 $8,483,537 $13,143,256 $17,182,434 -$9,981,560 $121,9711981-$5,048,597-$56,112,795 $552,5221750 $1,187,150,909 $755,143,915 11-$432,006,994 $396,729,194 $137,673,975 $121,8051586 $64,027,132 $21,096,106 $22,211,320 $25,245,067 $536,572 $485,864 $354,793 $6,766,394 $7,077,254 $8,428,631 $23,115,672 $331166,311 $35,859,373 $4,610,668 $4,741,670 $4,545,867 $4,911,307 $5,582,823 $3,723,481 $65,203,539 $69,863,277 $75,489,680 $92,841,409 $961239,255 $99,698,882 $9841180,277 $1,0171253,741 $973,766,377 $173,8131125 $186,336,968 $166,546,039 $11,365,241 $11,046,000 $12,674,475 $16,291 $96,3071920 $119,961,880 $1191329,396 $176,751,210 $144,760,781 $158,428,172 $319,501,740 $346,531,340 $302,057,641 $3,717,539,890 $4,331,814,169 $3,7511831,463 -6% 17% -13% -$571,778,454 -$64,595,219 $3,033,747 $6,879,073 -$131,071 $255,530 $1,351,377 -$3,438,266 $2,693,062 $17,654,613 -$195,803 $11206,553 -$11859,342 -$743,908 $51626,403 $21,653,623 $3,459,627 $15,202,179 -$43,487,364 $34,884,746 -$19,790 f929 $54,717,816 $1,628,475 $1,994,552 -$632,484 -$26,596,052 $13,667,391 $9,219,366 -$44,473,699 -$191,5741630 -$579,982,706 $148,224,659 -14% 4% (5-yr change) Source: Kenai Peninsula Borough Finance Department, Sales Tax Division 'confidential " ** Note that Mining, Quarrying, Oil & Gas gross sales reported here is slightly less than that reported in Chapter 10 Oil and Gas. In chapter " 10, a different aggregation of businesses is tallied which includes all hydro -carbon related business on the Peninsula. KPEDD 2016 Situations & Prospects — Page 44 The City Profiles in chapter 11 of the 2016 Situations and Prospects Report show each city's gross business sales in detail. Figure 45 - 2015 Gross Sales by City and Recent Change Homer $403,102,471 416,328,700 -$16,473,867 Kenai $6291610,107 43,454,045 $47,907,805 Seldovia $4,223,683 $975,610 -$450,838 Seward $282,0631853 $401,225 $42,682,199 Soldotna $4821124,898-$211383,594 $2,845,012 Outside of Cities $1,950,706,451 $654,063,784 -$656,493,016 TOTAL, Kenai Peninsula Borough $3,751,831,463 $614,274,279 -$5791982,706 Source: KPB Finance Dept. Sales Tax Office Figure 46 - Gross Business Sales ($millions), by City, 2006-2015 $5,000 $4,500 $4,000 $3,500 $3,000 c $2,500 •ro ,� $2,000 kus $1,500 $1,000 $500 $0 0 Outside of Cities 2006 $1,249.4 2007 $1,297.9 2008 $1,499.5 2009 $1,402.1 2010 $11545.2 2011 $2,035.6 2012 $2,245.5 2013 $1,953.2 2014 1 $2,607.3 2015 $1,950.8 ® Soldotna $432.9 $429.3 $468.2 $210.3 $420.8 $185.9 $428.6 $186.5 $430.7 $455.6 $500.7 $239.0 $3.7 $585.0 $436.0 $479.3 $239.4 $482.1 $282.1 0 Seward $198.4 $195.2 $211.0 $4.2 $516.7 $237.7 $3.6 ■ Seldovia $7.6 B Kenai $456.9 $9.5 $520.6 $5.5 $4.2 $6.4 $609.9 $I 395.7 $411.2 $383.6 , $364.2 1 $358.4 $4.7 $581.5 $4.2 $629.4 N $571.7 Homer , $356.2 $353.5 $405.4 $431.0 $419.7 , $403.2 Source: KPB Finance Dept, Sales Tax Office KPEDD 2016 Situations & Prospects - Page 45 9.6 Number of Businesses Differing sources of data suggest there are between 6,200 and 7,200 active business on the Peninsula. There were 7,270 businesses registered to report sales and potentially pay sales taxes in the Kenai Peninsula Borough in January 2016. Also at that time, there were 6,195 individuals that had an Alaska State business license with a physical location on the Kenai Peninsula (Figure 47). In 2014, the US Census Nonemployer Statistics documents 6,543 self-employed business owners that live in the Kenai Peninsula Borough with business income. Figure 47 - Number of State of Alaska Business Licenses with Establishments on the Kenai Peninsula, by Place, January 2016 Anchor Pt Clam Gulch Fritz Creek Halibut Cove Happy Vall Homer Hope Kachemak Kasilof Kenai Lowell Moose Pass Nanwalek Nikiski Nikolaevsk Ninilchik Port Graham Seldovia Seward Soldotna Sterling Sunrise Tyonek TOTAL Source: Alaska State Business License, 278 27 37 10 2 1,496 41 4 224 1,032 2 28 6 187 10 149 5 88 594 1,616 353 2 4 6,195 KPEDD 2016 Situations & Prospects — Page 46 10 KPB Economy: Industry Spotlights 10.1 Oil & Gas Industry The Oil and Gas industry is a maj or economic driver on the Kenai Peninsula, pumping $795 million in gross business sales into the economy in 2015, which was 21% of all business sales that year'-. However, gross business sales declined 35% or $436 million between 2014 and 2015, though this is still well above business spending levels prior to 2011. Oil and gas spending affects other business sectors. Approximately $730 million in 2015 gross business sales were from businesses linked (though not exclusively) to oil and gas activity including sales related to construction; professional, scientific, and technical services; remediation services; administrative and waste management; and transportation and warehousing. This suite of businesses together also saw declined gross business sales between 2014 and 2015 of 9% or $75 million. Workforce, Wages and Business Activity3 After a sharp build up in 2013, oil and gas employment on the Kenai Peninsula recorded by ADOLWD (QCEW) dropped in 2014 and 2015. The ADOLWD oil and gas employment tally is complicated by a coding correction made in early 2014 when the state discovered about 200 oil and gas workers coded to the Kenai region that instead were employed elsewhere. The erroneous employment had been counted in the Kenai region as far back as 2000, which means that all oil and gas employment figures before 2013 have been high by about 200. Thus, the 2014-2015 workforce decline in oil and gas is real, but less precipitous than published QCEW data indicates on Figure 48 (and in past reports). Keep this in mind and use it to temper interpretation of recent employment and wage trends. In 2015, oil and gas businesses paid out $166 million in wages, which was approximately 17% of all wages to employees on the Peninsula. This wage total was an increase of $800,000 compared to 2014, even though total workers were 250 fewer. In addition, 53 small business proprietors (self-employed) in the KPB were engaged in mining, quarrying, or oil and gas businesses generated $3.4 million in earnings. (Half of these businesses were in mining other than oil and gas.) 2 Uplands in the Kenai Peninsula Borough (KPB) and adjacent Cook Inlet host onshore and offshore oil and gas reservoirs, with a long history of development. Refer to the 2015 KPEDD Situations & Prospects for a review of Cook Inlet historic oil and gas production and context. 3 In the Situations & Prospects chapter on oil and gas, oil and gas activity is defined to include oil and gas extraction (NAILS 211), oil and gas well drilling (213111), work on oil and gas field wells (213112), petroleum and coal products manufacturing (324), and chemical manufacturing (325). This is slightly different than the combination of NAILS used by ADOLWD for its QCEW reporting, or by the Kenai Peninsula Borough for overall gross business sales (Figure 44). KPEDD 2016 Situations & Prospects - Page 47 1,800 1,600 1,400 w 1200 C7 1,000 800 O 600 0 400 z 200 u Figure 48 - Oil & Gas Employment and Total Wages, Kenai Peninsula, 2007-2015 1,669 15 2007 2008 2009 2010 2011 2012 2013 2014 2015 0 Employment (average annual) —Total Wages Number of Businesses in Mining, Oil & Gas $200,000,000 $180,000,000 $160,000,000 $140,000,000 $120,000,000 $100,000,000 $80,000,000 0 H $60,000,000 $40,000,000 $20,000,000 $0 Source: ADOLWD QCEW, A. Rodrigues There are currently about 50 businesses in this sector on the Peninsula, based on evidence from the following four sources: • In January 2016, the Kenai Peninsula Borough (KPB) listed 51 oil and gas related businesses registered for sales tax purposes (January 2016), of which eight show a Kenai Peninsula community as home. In 2014 there 61 registered with 15 headquartered on the Peninsula. • The list of Alaska State business license holders had 24 businesses in this sector with a physical address on the Kenai Peninsula in early 2015. • The ADOLWD QCEW listed 42 employers in this sector active in the KPB in 2015. • 53 small business proprietors (self-employed) lived in the KPB with a mining, quarrying, or oil and gas business in 2014. Business Sales Until 2011-2012, gross sales by oil and gas businesses fluctuated between $213 million and $380 million on the Kenai Peninsula. In 2011-2012, business activity increased 2 to 3 times in value, coinciding with significantly increased activity in Cook Inlet. Year 2014 saw anomalously high spending. In 2015, low oil prices and uncertainty over tax credits resulted in a decline of 35% or $436 million. Oil and gas related business activity comprised 21-25% of all business sales on the Peninsula in 2014 and 2015 (Figure 49). • The vast majority of oil and gas related sales are tax exempt, so taxable oil and gas sales comprise less than 1 % of all taxable sales on the Peninsula. KPEDD 2016 Situations & Prospects — Page 48 • This means that while decreased oil and gas activity has a number of negative economic implications, it does not have a significant negative impact on tax revenue to the borough. Figure 49 - Kenai Peninsula Borough Gross and Taxable Sales Activity, Oil and Gas Businesses 2015 $795,1021538 -35% 21% $61511,900 $8,042,010 0.54% 0.78% 2014 $1,231,538,492 106% 25% 2013 $598,579,715 -37% 16% $71049,602 0.69% 2012 2011 2010 $9571519,274 $640,427,871 $253,510,248 50% 153% 19% 24% 18% 9% $51532,043 0.56% $5,500,868 $4,1401876 0.57% 0.46% Source: Kenai Peninsula Borough Finance Office, Sales Tax Division Current Conditions and Outlook Because of low oil prices and the still undefined yet certain to change structure of Alaska oil and gas tax credits, Cook Inlet suffers some of the same challenges as other oil and gas regions but is somewhat shielded due to the region's producers heavier reliance on natural gas sales contracts rather than oil. A noticeable downturn in 2016 was the withdrawal of Apache Corporation from Cook Inlet oil exploration. Another was Cook Inlet Energy's reorganization under bankruptcy court authorization in early 2016, which will result in payment of 10 cents or less on the dollar owed to dozens of oil field goods and services providers owed $35 million. Just one local example is All America Oilfield, a Kenai -based subsidiary of Chugach Alaska owed $286,0004. A recent Peninsula Clarion articles summarized the Cook Inlet 2016 outlook: "Most of the Cook Inlet producers are smaller companies than those that operate on the North Slope and are planning to be here for the long term. Although the price of oil is predicted to remain low and the future of the oil and gas tax credit program is still uncertain, the three major companies in with interests Cook Inlet — Hilcorp Alaska, BlueCrest Energy, and Furie Operating Alaska — are expected to continue their plans for this year." Furie is a gas producer; the bulk of Hilcorp's production is gas, under contract to Southcentral Alaska utilities; and BlueCrest is just starting up a long-term oil prospect. Furie brought in another jack -up rig to drill offshore of Homer in its Kitchen Lights field and has recently signed a natural gas contract with Homer Electric Association that went into effect in April 2016. Furies has applied to drill nine new wells over the next five years, though go-ahead decisions are pending legislative decisions regarding the oil and gas tax credit program that is important to Furie's capital spending plans. Increased natural gas supply in the area continues to help hold down prices to local utilities and thus for consumers. Hilcorp Alaska plans to invest about $220 million in 2016 on maintenance, operations, and other projects, according to the March Peninsula Clarion article, one of which is an exploration project on the lower Kenai Peninsula. BlueCrest Energy started oil production from its Cosmopolitan field off Anchor Point in April 2016. They intend to drill additional oil production wells this year; however they cite pending decisions on oil and tax credits as a 4 DeMarban, Alex (2016, February 1). New York investors to take over Cook Inlet Energy in bankruptcy deal. Alaska Dispatch 5 Earl, Elizabeth (2016, March 29). Trends 2016: Cook Inlet producers continue with scheduled plans. Peninsula Clarion. KPEDD 2016 Situations & Prospects - Page 49 factor in their oil and gas drilling plans. Though the reservoir also includes gas reserves, B1ueCrest is holding off on investing in an offshore rig for gas drilling until it has customers for the production. The most significant future issue for the region is whether or not a gas pipeline will be built to deliver North Slope natural gas more than 800 miles through the state to a liquefaction plant and marine terminal at Nikiski for LNG export shipments. The partners in the Alaska LNG project in 2015 approved a budget of up to $230 million for 2016 for field work, further engineering and design, and regulatory work. That spending will include seismic work, geophysical work, and drafting environmental and socioeconomic resource reports, as well as evaluations of other factors, according to a news release from the Alaska LNG Project. According to updates issued by Larry Persily of the Kenai Peninsula Borough's mayor's office', this round of reports will address issues raised by regulatory agencies and the public, including why the project picked Nikiski as the site for its proposed natural gas liquefaction plant and how it would reduce impacts on highways, recreation activities, and tourism during construction and operations. The Alaska LNG project is in the pre -front-end engineering and design phase, which is expected to be completed in 2016. The current plan calls for submittingB1ueCrest Energy, Photos Courtesy of Rick Roeske p p the full project application and environmental and engineering reports to the Federal Energy Regulatory Commission (FERC) in late 2016 or early 2017. After a successful environmental impact statement process, regulatory approvals, and an investment decision by the partners on whether to proceed, construction could start in 2019. First production at the LNG plant would be in 2025, though the schedule is subject to change. fir►' '�„ � ;�i . `� , I �JJII y i�_ 6h1 i 5 IY 6 Persily, Larry (2016, April 26). LNG Project Update: Alaska LNG outlines issues for next round of resource reports. Kenai Peninsula Borough Mayor's Office KPEDD 2016 Situations & Prospects - Page 50 10.2 Kenai Peninsula Maritime Work Maritime Workers, Wages, and Activity? Maritime -related work is tied with health care as the largest source of employment on the Peninsula. Maritime work generates more earnings, at $177 million (2014), than any other type of work; the next closest is Local Government whose workers earned $142 million (2015). Over 3,400 worked in amaritime-related job on the Kenai Peninsula in 2014. • The number of workers is up by 90 compared to 2013. • However total earnings were down by $12 million. • Earnings were down for most parts of maritime industry with the exception of water transportation and marine leisure and hospitality businesses (Figure 51). Maritime jobs are those linked to the ocean or rivers, those who "touch" the sea. This includes fishermen, cannery workers, barge line operators, oil and gas vessel support, SeaLife Center researchers and employees, AVTEC maritime instructors, sport fish guides and whale watch charters, marine biologists, engineers, and surveyors, fishing crew, fishing gear retailers, fish wholesalers, local government port and harbor workers, state and federal fishery scientists and technicians, and more. The mix of maritime industry workers on the Kenai Peninsula can be reviewed on Figure 50. Figure 50 - Kenai Peninsula Maritime Workforce by Type of Work, 2014 7% Marine Professional, Scientific, & Technical Services 6% Marine Leisure & Hospitality 3% Marinas, Boat Dealers, Boat Building 4% Mar;rA r,,,rc+v Manu Rep(, 3% 0.4% Jovt 7 Statistics typically aggregate maritime work and economic activity as part of many different industry sectors, so they are "hidden" as part of other work. As a result, maritime contributions to the economy are often not recognized. This is beginning to change in Alaska as communities and regions recognize that living on and near the ocean, offers opportunities for economic growth when the opportunities are recognized and strategic land, workforce, and infrastructure investments are made. On the Peninsula, Seward and Homer in particular have recognized this part of their economy and are making strategic decisions to increase its size and strength. KPEDD 2016 Situations & Prospects — Page 51 Alaska ranks 3rd in the nation in per capita maritime jobs, according to the ADOLWD. Life and work in the Kenai Peninsula region strongly reflects this with the area's strong ocean -based economy. For example: • Seward's Alaska Vocational Technical Center (AVTEC) is home to the Alaska Maritime Training Center. Here eight instructors promote safe marine operations by training captains and crew members for employment in the Alaskan maritime industry. Courses use a world class ship simulator, state of the art computer based navigational laboratory, and modern classrooms equipped with the latest instructional delivery technologies. • The active Homer Marine Trades Association http://www.homermarinetrades.com/ has just affiliated with Maritime Works, a new statewide workforce investment organization dedicated to providing Alaska's employers with qualified workers across the maritime industry. • Homer is focusing on its growing marine trade services by leveraging a $4.2 million revenue bond that is bringing in $30 million in improvements at the harbor area by federal and state agencies and private businesses. A number of marine trades businesses are investing here. • NOAA ranks the commercial fish ports of Seward, Kenai, and Homer as 26th, 33rd and 70th (respectively) in the US in 2014 in pounds of fish landed. Cumulatively these three ports landed 85.2 million pounds of commercial fish that generated $107.5 million in ex -vessel value in 2014. (Though this is a decrease from 2013 totals of 130.2 million pounds landed with an ex -vessel value of $135.4 million.) • Seward is one of only four communities in Alaska with a drydock. In 2014, the City of Seward and Vigor Industrial inked transfer of the Seward Ship Drydock & Chandlery's assets and contracts to Vigor. • Seward is developing a sustainable business and infrastructure development plan for its Marine Industrial Center (SMIC) that includes better use of uplands to support marine industrial development and services and construction of a new breakwater. In late 2015 AIDEA conducted interviews with SMIC users and found growing interest in storing tugs and barges at SMIC, additional opportunities to provide winter moorage for drill rigs, SMIC has a competitive advantage for 50 feet+ vessel work and boat haul - outs, AVTEC training operations are beneficial to maintenance and repair operators and this may be a basis for expanding technical activities, that the USCS is investigating facilities for new Sentinel class cutters in Alaska, and also that oil and gas vessels are generally too large for SMIC facilities. • The Seward SeaLife Center is Alaska's only public aquarium and ocean wildlife rescue center. • Cook Inlet/Kenai River supports the most popular sport and personal use salmon fisheries in Alaska. • The University of Alaska Fairbanks/National Science Foundation research vessel SIKULIAQ is homeported in Seward. • The Homer -based Alaska Clean Harbors non-profit program, works with harbors around the state. • Cook Inlet is home to approximately 1,584 marine vessels over 28 feet. Commercial fishing vessels make up the majority of vessels and account for a higher gross tonnage than any other category. Recreational vessels make up the second largest category, both in terms of vessel count and gross tonnage. The average Cook Inlet vessel is 41 ft. long, 35 gross tons, and 29 years old. Seward Working Waterfront, Photo by Barbara Sheinberg KPEDD 2016 Situations & Prospects — Page 52 Figure 51- Kenai Peninsula Region Maritime Employment and Earnings, 2013 and 2014 AMMPIM __1 n O_1_ ' 21H� 1 2013 2014_111014 Fishing(self-employed)' 1,625 1,723 $104/126,000 $101/347,000 11625 11723 $64,078 $58,820 (receipts) (receipts) Fishing and Seafood Processing 2 ( employees/ payroll, for aquaculture, 44 45 $21,200,583 $18/879,300 545 500 $38,900 $37,759 fishing, seafood processing, wholesalers, seafood markets) Water Transportation 2 (e.g., water transportation, guides, 68 70 $19,701,920 $20/254,940 386 397 $51,040 $51,020 tours, support) Marinas, Boat Dealers, Boat 11 10 4 430 137 $ ' 3 907 948 $ ' 106 90 $ 41 794 43 422 $ ' Buildin 2 g Mixed Marine Leisure & Hospitality 2 (e.g. marine museums, marine or 55 60 $4,416/677 $4,9101780 158 180 $27,954 $27,282 fishing guiding services, fish camps with accommodations) Mixed Marine Professional, Scientific, & Technical Services 2 31 26 $19/925,368 $13/402/449 281 232 $70,909 $57,769 (e.g. boat design, marine surveyors, marine engineering, fisheries research) Mixed Marine Construction, Manufacturing, Education, 9 11 $2,787,253 $4,115,188 66 85 $421223 $48,414 Boat Repair & Maintenance 2 Boat repair (self-employed) 68 57 1 505 000 $ ' 1 239 000 $ ' 68 57 $ 22 132 21 737 $ ' (NAICS 811490) State government Maritime Employees 1 1 $4,359,251 $4,219,076 92 89 $47,383 $47,405 (ADF&G) Federal government Maritime Employees 2 2 $1,047/349 $1,100/564 13 13 $80,565 $84,659 (NOAA, some USFWS) Local Government Maritime 6 6 3 792 695 3 714 819 38 41 $99,808 90 605 Employees 3 Total Kenai Region 11920 21011 $189,292,233 $177,091,064 3,378 31407 $55,445 $51,979 Maritime Sources: 12013, 2014 US Census Nonemployer Statistics 2 ADOLWD QCEW data/research by M. Abrahamson and C. Bell 3 Local Government data excerpted from FY 15 budgets - Seward, Homer, Kenai, Seldovia, and Kenai Peninsula Borough (Kenai River Center); employment is estimated from web listings of employees by department or interviews. Data compiled by Sheinberg Associates KPEDD 2016 Situations & Prospects — Page 53 Marine Cargo - Seward is the Kenai Peninsula's main port hub. Chapter 7 on Road, Air, and Marine Travel and Freight reviews marine cargo imports and exports in detail (beginning on page 23). Vessels, Boat Building, and Repair In 2014, there were over 200 employees or small business owners engaged in activities related to boat building, repair, construction and manufacturing (and boat dealers). This is an area of economic activity that Homer and Seward seek to expand. This marine service work makes sense given the large number of vessel on the Kenai Peninsula. The Alaska Maritime Industrial Support Sector study (McDowell Group, 2014) found that slightly over half of Cook Inlet's vessels were built in the 1970s and 1980s, which is similar to the entire Alaska fleet. However, Cook Inlet has a large number of vessels built after 1990. This study also found that Homer is by far the largest regional port in Southcentral Alaska in terms of vessel counts. Homer is home to 440 commercial fishing boats, 84 recreational boats, and 54 passenger vessels (plus 19 other miscellaneous vessels). Seward is home to 167 recreational boats, 62 commercial fishing boats, and 61 passenger vessels. The Alaska Commercial Fisheries Entry Commission (CFEC) tracks commercial fishing vessels, and in 2014 listed 1,130 vessels registered to KPB residents. This included 111 owned by a company or partnership, 205 with a refrigeration system, and 939 registered for a salmon net area. Figure 52 - Commercial Fishing Vessels, Kenai Peninsula Borough Total Number of Commercial Vessels 1,130 Average Year Built 1986 Average Age (in the year 2014) 28 years Average Length 33.9 feet Type of Activity (vessels can be used for more than one purpose) Freezer/Canner 3 Tender/Packer 106 Guided Sport (Charter) 0 Commercial Fishing 1,103 Hull Type Aluminum 415 Concrete 0 Fiberglass/Plastic 631 Iron/Steel/Alloy 54 Rubber 5 Wood 23 Source: CFEC, Commercial Vessel Characteristics and Statistics One other data source is the Alaska Department of Motor Vehicles, since all vessel owners must register with them every three years and include their residence. In 2015, there were 68,614 motorized vessels registered in Alaska. Of this total, 14% or 9,449 were registered to a resident in the Kenai Peninsula Borough. This is many more vessels that the Alaska Maritime Industrial Support Sector study listed, which must have analyzed a different dataset. (hqp://doa.alaska.gov/dmv/research/boatl5.htm) KPEDD 2016 Situations & Prospects — Page 54 10.3 Commercial Fishing and Seafood Processing Commercial fishing is a major industry in the Kenai Peninsula Borough. Seward and Kenai are among the top United States ports in the pounds landed and value of commercial fishery landings. • In 2014, Seward was ranked 21s' top US port for value and 261h for pounds and Kenai was ranked 35th for value and 33rd for pounds. • For the IFQ Pacific Halibut harvest in 2015, Homer was the 2nd top port in the US with 345 vessels landing 2.6 million pounds or 15% of the total harvest. • Seward that year was the top US Sablefish port, with 316 vessels landing 5 million pounds or 25% of the US harvest across its docks. Residents of the Kenai Peninsula have a long and successful history in commercial fishing and seafood processing. Kenai Peninsula Borough (KPB) - had 7.8% of Alaska's population in 2015, and according to the Alaska Commercial Fisheries Entry Commission (CFEC), in 2014 its residents:- o • Received 6.6 /o of the states total�4 commercial fish gross earnings T. ! -- .... . A • Harvested 2.6% of all commercial caught fish in Alaska, • Were 10.7 /o of the states commercial - permit holders ¢ - • Accounted for 12% of all commercial -- - permits fished Photo courtesy of Peninsula Clarion, Rashah McChesney. Work at Kenai's Pacific Star Seafood Wharf Salmon harvest accounted for almost two-thirds (62%) of all commercial fishing gross earnings in 2014 to Kenai region residents. Figure 53 - Value of KPB Resident's 2014 Harvest, Measured by Estimated Gross Earnings Salmon $72,332,754 62% Sablefish $8,605,239 7% Halibut **$13,398,670 **12% Other Shellfish $2841168 0% Other Groundfish $8,553,566 7% Herring $1,237,489 1% Crab $10,498,045 9% Confidential $1,0531265 1% Total Gross Earnings $115,963,196 100% ' at least, there is additional confidential data not included. Source: CFEC Fisheru Statistics KPEDD 2016 Situations & Prospects — Page 55 Residents from 17 communities on the Kenai Peninsula commercial fished in 2014 (Figure 54). • Homer is "king," its commercial fishermen landed 74% of all pounds that Kenai Peninsula residents harvested and earned 65% of the gross that came to the region that year. • Neighboring Anchor Point residents added another 3% of total pounds harvested and earned 2% of the gross. • Seward residents harvested 5% of the Kenai Peninsula Borough total and brought home 8% of the region's gross earnings. Figure 54 - Kenai Peninsula Resident Commercial Fishing Activity, 2014 Harvest from All Places, All Fisheries Combined Holdersr Eross -"--q 0 -- I I Community,...j- F� F� IRTIN, Fermits Number of % Earnings.,.J- Harvested, Fished Permit KPB Total $115,9631196 145,6091946 11517 11432 Alaska Total $11752,856,030 51591,905,235 12,654 13,368 KPB as a % of AK 6.6% 2.6% 12.0% 10.7% Anchor Point $2,428,172 366,5220 45 52 Clam Gulch $11301,276 73,4653 33 29 Cooper Landing $0 0 0 2 Fritz Creek $11542,683 1,728,359 20 17 Halibut Cove $416,602 232,134 11 7 Homer $74/255,972 1071524,844 693 589 Hope $0 0 0 1 Kasilof $4,598,212 5,731,136 121 120 Kenai $7,079,028 6,0391906 202 217 Moose Pass $761,900 671/814 5 6 Nanwalek $0 0 0 6 Nikiski $1,175,189 736,650 34 41 Nikolaevsk $1,4181218 1,0941593 30 24 Ninilchik $1,336/977 1/177/298 36 43 Port Graham $176,105 160/542 6 5 Seldovia Seward Soldotna Sterling Tyonek $2,926,669 2,8091347 $8,7361426 71570,095 $5,392,487 31645,939 $2, 328, 767 21035,140 $88,513 52,276 Source: CFEC Fishery Statistics 43 F3 123 31 8 40 59 137 23 14 KPEDD 2016 Situations & Prospects - Page 56 Since the mid-1990s, Kenai region residents have consistently received 6 to 8% of all gross earnings from commercial fishing in Alaska. The last nine years of data is shown on Figure 55. Figure 55 - KPB Resident Permit and Fishing Activity, by Year (all fisheries, all areas, all permits) 2006 1,407 2,136 1,025 11364 1121739,074 $76,759,760 $11168,678,059 6.6% 2007 1,407 21121 999 11344 146,579,950 $99,431,356 $1,298,832,267 7.7% 2008 1 396 2 122 1 025 1 353 129,394,179 $107 634 696 $11489f 117 512 7.2% 2009 11408 21176 11024 11399 122,005,714 $851028,773 $1,149,586,999 t_$1 7.4% 2010 11428 21206 11024 11405 1711744,645 $125,126,250 1487f0151419 o 8.4 /o 2011 1,434 2,296 11079 11507 148/452,292 $124,888/822 $118691719,562 6.7% 2012 1,434 2,296 11079 11507 148,452,292 $1241888,822 $1,881,387,782 6.6% 2013 1,429 2,216 1,097 11504 185,479,739 $136,515,228 $1,909,477,746 7.1% 2014 1,432 2,124 1118 1,517 145,609,946 $1151963,196 $11752,8561030 6.6% Source: CFEC fishery statistics Gross earnings of KPB commercial fishermen were down 15% in 2014 compared to 2013. Statewide, commercial fishing gross earnings were down 8% in 2014. In 2014, KPB residents owned 1,130 licensed commercial fishing vessels, including 106 tender/packer vessels, and 3 freezer/canner vessels. The number of commercial fishing vessels owned by KPB residents declined for many years until a 2008 low of 938 vessels; since then the number has been rising. Business Activity, Workforce, and Earnings High levels of commercial fishing coincide with high levels of fish processing. A 2012 count by the state identified over 30 fish and shellfish processors on the Kenai Peninsula, located in Seward, Seldovia, Homer, Nikiski, Kenai, Soldotna, Kasilof, and Ninilchik. These range from smaller value-added operations to large statewide processors. The largest plants are Icicle Seafoods in Seward, and the Inlet Fish plants in Kenai and Kasilof. . According to ADOLWD occupational data, there were 1,639 seafood processing workers in KPB in 2014. Of this total, 547 (33%) were Alaskan workers and 1,092 were nonresidents. Seafood processing workers on the Peninsula earned $16.7 million in 2014; of this total $9 million (54%) went to nonresident workers and the rest to Alaskan workers. Seafood processors share approximately 3% of the value of the fish they process (collected from fishermen) with the state, which then shares half of this with the municipality where the processors are located. KPEDD 2016 Situations & Prospects — Page 57 During fiscal year 2015, the state shared $1.2 million with the Kenai region from commercial fishery taxes (Figure 56). • Half of the total shared went to the borough, and the other half is split among cities proportional with the amount of processing that occurred there. • Totals shared in FY 2015 were $644,000 to the borough, $349,000 to Seward, $196,000 to Kenai, $21,000 to Homer, and $2,800 to Soldotna. • This translates roughly to $81 million worth of fish processed in local plants. • The more fish that are processed locally and the more value per fish that processors can add, the higher will be the revenue that circulates through the region from commercial fishing. Figure 56 - Amount of State Fisheries Taxes Shared with KPB and Cities $2,009,804 $1,846,030 $1,775,545 $1,528,107 $1,212,640 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 Source: Alaska Department of Revenue Combining employment and proprietor data from several sources yields an estimate of 537 average annual workers and over 2,200 working during peak season in commercial fishing or seafood processing on the Kenai Peninsula. Income, from earnings and wages, is estimated at between $122 and $137 million. Keep in mind that the estimated gross commercial fish earnings to fishermen are not net earnings. This is the value of the fish harvested, against which commercial fishermen must deduct all their business expenses to determine their net income. 1'VVOU lllallula% Lullll6 -t-it/ ' `�1C•' 18 $539,000 465 (primarily fish) 3 (1,639 peak) million million TOTALS 537 $21.0 1 741 $101.8 - $116.4 2 278 F$122.8 - $137.4 million million million 1, 2 Salaried employees - ADOLWD QCEW, 2015-average annual; Self-employed proprietors no.- Nonemployer Statistics, 2014 for commercial fishing businesses only, Income from two sources - Nonemployer statistics, 2014 and CFEC 2014 estimated gross earnings of KPB resident commercial fishermen 2014; 3 Salaried employees - ADOLWD ODB as reported in 2014 Nonresident Workers in Alaska, Self-employed proprietors- Nonemployer Statistics, 2014 KPEDD 2016 Situations & Prospects — Page 58 Cook Inlet Fisheries Salmon Kenai Peninsula Borough residents - from many different communities - earned over 60% of Cook Inlet salmon fishery gross earnings. Cook Inlet sockeye salmon typically are 70-85% of all pounds of salmon commercially harvested in Cook Inlet (CI); however, in 2015 they were only 38% of the total haul because there was a 5-fold increase in the pounds of pinks harvested that year. This pink salmon harvest broke records for the CI region. Sockeyes were still the money fish though, accounting for almost $24 million or 79% of the total ex -vessel value for all CI salmon commercially harvested in 2015. The average weight of sockeyes was near the bottom of a 20-year record, at 5.32 pounds in 2015. The price per pound for Cook Inlet sockeye reported by ADF&G for 2015 was $1.59, down from $2.25 the year before. The commercial chinook salmon harvest in Cl was up in 2015, in both pounds and ex -vessel value. Escapement was high enough that sports harvest of kings in the Kenai River was opened for a few days for the first time in several years. The average value of a Cook Inlet purse seine permit slipped $1,200 between 2015 and 2014; however, the 2014 value of $86,000 was a 20-year high. The value of Cook Inlet drift gillnet permits dropped 15% between 2014 and 2015, to $63,500. Commercial fishing tenders and driftnet boats unload fish at the city of Kenai dock near the mouth of the Kenai River. Photo courtesy of Peninsula Clarion KPEDD 2016 Situations & Prospects - Page 59 Figure 58 - Gross Earnings Cook Inlet Drift and Set Gillnet Salmon Fisheries, 2014 Kenai Peninsula Borough Anchor Point Clam Gulch Homer Kasilof Kenai Nikiski Ninilchik Soldotna Other KPB Communities Alaska Total Anchorage $13,740,222 $7,316,895 $295,292 $178,761 $0 $1,046,281 $5,904,762 $234,677 $1,1481601 $11460,745 $2,160,129 $2,186,421 $5311116 $173,907 $345,734 $542,478 $1,583,685 $1,020,503 $1,7701903 $473,122 $16,317,762 $9,508,237 ()76 47.E $1 574 892 Kenai Peninsula Borough $13,740,222 Other places in Alaska $1,601,065 Total $21,897,315 Alaska $16,3171762 Washington $1,836,162 Oregon $1,655,698 California $373,948 Other States $1,713,745 Source: CFEC, Permit & Fishing Activity/ $7,316/895 $616/450 $11,085,187 $9,508/237 $479,136 $0 $90,993 $0 Figure 59 - Average price per pound for Cook Inlet Salmon Chinook $1.89 $2.02 $2.84 $2.55 $2.97 $2.94 $3.37 $2.89 $2.84 $2.05 Sockeye $1.07 $1.00 $1.26 $1.27 $1.65 $1.38 $1.44 $2.25 $2.25 $1.59 Coho $0.66 $0.56 $0.64 $0.79 $0.97 $0.77 $0.76 $0.85 $0.90 $0.60 Pink $0.12 $0.07 $0.30 $0.23 $0.31 $0.42 $0.33 $0.38 $0.26 Chum $0.30 $0.21 $0.54 $0.40 $0.65 $0.68 $0.51 $0.43 $0.53 $0.41 Source: Alaska Department of Fish and Game, Alaska Commercial Salmon Harvests and Ex -vessel Values KPEDD 2016 Situations & Prospects - Page 60 40,000 20,000 Figure 60 - Cook Inlet Salmon Harvests and Ex -vessel Prices, by Species, 2006-2015, with 5-year Moving Average Trendlines Cook Inlet SOCKEYE Salmon Harvest Cook Inlet SOCKEYE Salmon (1000s hounds) Exvessel Value (in $1000s) 0 !1 111 111 111 111 111 1 1 1 1 1 1 1 1 1 1 1 1 �10 N 00 (01\ O r+ N M d� O O O O O O O O O O N N N N N N N N N N 3,000 2,000 1,000 0 O O O O O O O O O O N N N N N N N N N N S Cook Inlet CHUM Salmon Harvest (1000s pounds) $60,000 $40,000 $20,000 $0 0 0 0 0 N N N N N N N N N N $6,000 $4,000 $2,000 $0 11.0 L� 00 ON CD N c r) d� r--� O O O O CD O O O O O N N N N N N N N N N $1,500 $1,000 $500 T7F- $0 � 00 a1 O r-+ N c'0 di N N N N N N N N N N Cook Inlet PINK Salmon Exvessel Value (in $1000s) Cook Inlet COHO Salmon Exvessel Value (in $1000s) Halibut and Sablefish Approximately $30.5 million or 26% of all estimated gross earnings from commercial fishing to Kenai region residents in 2014 came from groundfish, including 12% from the halibut harvest, 7% from sablefish, and another 7% from other groundfish. In 2015, 659 vessels landed 4.5 million pounds of commercial halibut at three ports in the KPB: Homer (2.6 million pounds), Seward (1.9 million pounds), and Kenai (14,000 pounds). The number of vessels participating continues to decline each year, from 1,105 in 2006 to 659 in 2015. Thirty percent of the statewide commercial halibut harvest was landed in the borough. Homer and Seward are the 2nd and 3rd top landing ports in the US for individual fishing quota (IFQ) halibut landings by pounds. Due to confidential data, the total gross earnings for KPB commerical halibut fisheries cannot be reported, but it was at least $13.4 million in 2014, which is an estimated $3.3 million less than in 2013. Figure 61- Commercial Halibut Harvest Landed in KPB (in pounds), and Percent this is of Statewide Harvest 18 16- 14 12 0 10 0 0 8 6 •� 4 4-0 > 2 x 0 � source: 2006 NOAA IFQ 2007 2008 2009 2010 2011 2012 2013 2014 2015 � Lbs Halibut Landed Percent of Statewide Harvest 45% 40% 35% 30% a� 25% r a 20% 15% x 10% 5% 0% 0 KPEDD 2016 Situations & Prospects — Page 62 Seward was the top sablefish port in Alaska, with 316 landings and 5 million pounds landed in 2015. Altogether, KPB 25% of the state's harvest crossed Seward or Homer's docks in 2015 creating $8.6 million in gross earnings, up $2.1 million compared to 2014. Figure 62 - Commercial Catch of Pacific Sablefish in KPB (pounds) with Five Year Moving Average Trendline 9 8 7 6 5 O 4 .0 3 .,__, 2 1 0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Source: NOAA IFQ Reports Fisheries within City of Kenai The City of Kenai occupies a unique position in that four distinctly different fisheries take place within the City's boundaries: commercial, sport, personal -use, and educational fisheries. Given this, the City works diligently with other agencies to support sustainable fisheries harvests. The rapid growth of the Kenai River personal use dipnet fishery has added a 250,000-400,0000 sockeye fish harvest in a short time period to the management mix; beginning in 2013, harvest of King Salmon was prohibited. The City of Kenai bears management expenses that nearly equal revenue from this fishery to the City. For example management activities in 2014 included instituting a tide dependent no wake zone for a 6,000 foot segment of the south river bank to reduce erosion; eliminated one access, improving another, and constructing a new access at the Kenai River mouth; maintaining solid waste and pit toilets, and providing police foot and boat patrols. Revenue from this personal use fishery to the City comes from municipal boat launch and parking fees. Sector Trends, Issues, and Outlook Add Value. Homer, Seward, and Kenai are top US ports for commercial fish landings and total ex -vessel value. Fish are plentiful in the region and the industry and workforce are positioned to continue to benefit. Cook Inlet region seafood processing operations have a competitive advantage over other parts of the state in being on the road system. Freshly frozen fish can be packed in refrigerated vans and trucked to US and Canadian markets immediately after it is caught. Additional economic opportunities are available by increasing local value-added seafood processing in areas such as new food products, nutraceuticals, cosmetics and skin care, fish skin leather, supplements, performance fabrics from crab and shrimp shells, bio-oils and fuels, and other products that increase the percent utilization of whole fish. KPEDD 2016 Situations & Prospects - Page 63 Cook Inlet has largest quota share but is only place in Pacific Northwest with reduced overall quota for 2016. After two decades of declining halibut quota due to declining stocks, the International Pacific Halibut Commission raised the overall halibut quota in 2016 for the second time in as many years. The commission also adopted management plans for the halibut charter fishery made by the North Pacific Fishery Management Council in 2015. Despite an overall quota increase however, area 3A (Cook Inlet region) was the only place with less - set at 9.6 million pounds limit a 500,000 pounds decrease from 2015. Higher overall quota and good halibut prices in 2015 are currently causing the price of quota shares to increase. For sports harvest, the commission kept the two fish daily bag limit with a maximum size limit on the second fish of 28 inches (down from 30 inches in 2015). Four fish is the annual bag limit. "Every Fish has a Name On It". Being near Alaska's population centers and having road accessible fisheries raises attention to Cook Inlet fisheries. At Alaska Board of Fisheries meetings, management concerns erupt among commercial gear groups, between Anchorage/Mat-Su versus and Cook Inlet fishing groups, and between area sport and commercial fishing associations. Unknowns among management and allocation decisions create anxiety and uncertainty among users. ADF&G Budget Cuts. Declining state budgets could impact fish research and data collection as well as the timeliness of fish decision -making. Ocean -Warming. The long-term effect of ocean warming and acidification on future commercial fisheries migration and growth patterns is an unknown and of concern to the industry. Fish Prices. Market prices for fish are subject to many different variables and market forces. Price significantly alters profitability and economic impact to the region. Fish business reporters and permit brokers are predicting another low year for salmon prices but a strong halibut market. In February 2016, fishery reporter Laine Welsh reported': "Early signs point to continuing headwinds in world markets for Alaska salmon "due to global currencies remaining in disarray, and the ongoing Russian seafood embargo diverts more farmed salmon to the US, tons of product remains in freezers from back-to-back bumper sockeye runs. (Most of Alaska's salmon goes to market in frozen, headed and gutted form). One plus reported by McDowell Group's Andy Wink is that aggressive market promotions have kept reds moving briskly at retail outlets at home and abroad, removing some of the backlog. 8 http://www.adn.com/article/20160220/dont-expect-price-jump-alaska-red-salmon-year KPEDD 2016 Situations & Prospects — Page 64 10.4 Tourism and Visitors Kenai Peninsula recreational opportunities are enjoyed by residents and visitors alike. The peninsula's road accessible rivers, lakes, bays, mountains, glaciers, fish and wildlife will continue — as long as transportation costs are not prohibitive — to ensure the area is an important travel destination for people from Anchorage, the rest of the state, the US, and the world. The area's diverse attractions include fishing, wildlife viewing, hunting, RVing, boating, hiking, biking, skiing, marathons, camping/ backpacking, ATVing, snow machining, kayaking, canoeing, rowing, sailing, and snowshoeing. The region also benefits from developed parks and Recreation Centers with tracks, rinks, swimming pools and more. In 2015, reduced gas prices and a stronger national economy meant more people traveling and vacationing. Tourism was up throughout the Peninsula, at most destinations and by all modes of travel. Tourism promises to be a growing advantage for the Kenai Peninsula, which caters to other Southcentral Alaska visitors, US travelers, and a growing international tourist market. The Kenai Peninsula is well known for its fishing, but it also offers adventure, scenic beauty, glaciers, and wildlife; these natural assets are increasingly valuable in the growing "experience economy," in which consumers prize experiences. Business Activity, Workers, Earnings The visitor industry experienced strong growth in 2015. For this report, visitor oriented businesses include those with Lines of Business (per KPB sales taxes) or those in the state's database in Arts, Entertainment, and Recreation (NAICS 71); Accommodations and Food Services (NAICS 72); and Scenic and Sightseeing Services, which includes Water and Land Guides (NAICS 487000, traditionally aggregated with Transportation for QCEW employment). Since restaurants and bars serve residents along with visitors, the economic impact just due to visitors is difficult to isolate for these businesses. Gross sales from visitor -industry related businesses increased from $257 million in 2014 to $271 million in 2015, up 6%. This is a 15% increase compared to gross sales five years ago. Figure 63 - Gross Sales for Visitor Related Businesses in the Kenai Peninsula Borough 1 1 1 '.r_'_2011-201,5(9-'Yr"7q Business Type �k SalpQ Mr Change _fig • e nag Arts and Entertainment $7,2051880 $135,197 2%-$7,332,812 -50% Guiding Land $313821241 $427,376 14% $1,665,572 97% Guiding Water $65,036,445 $5,468,844 9% $8,483,537 15% Hotel/Motel/Bed & Breakfast $95,864,781 $4,684,579 5% $17,182,434 22% Restaurant/Bar II $991698,882 II $3,459,627 4% IL $15,202,179 18% TOTALS $271,188,229 $14,175,623 6% $35,200,910 15% Source: Kenai Peninsula Borough Finance Dept, Sales Tax Division KPEDD 2016 Situations & Prospects — Page 65 Figure 64 - Gross Sales, Visitor Related Businesses, Kenai Peninsula, 2009-2015 $120,000,000 $1001000,000 $80,0001000 p V V $60,0001000IN — $40,0001000 — $20,000,000 — $0 =, 2009 2010 2011 2012 2013 2014 2015 (Arts and Entertainment Guiding Land ==06mGuiding Water ® Hotel/Motel/Bed & Breakfast Restaurant/Bar Source: KPB Finance Dept, Sales Tax Office Employment was up by 74 between 2014 and 2015, and total wages increased $2.9 million during this period (Figure 65). Average monthly wages increased by $42 or 2% (inflation was half of one percent this year), which is positive as average annual wages to workers in the visitor -oriented Leisure and Hospitality sector are the lowest in the Borough (as is true in most places). Figure 65 -Visitor Industry Employment and Wages 3,000 2,500 a� 2,000 0 1,500 w a� 1,000 a� 500 0 0 $60 $50 $40 0 $30 $20 $10 w $0 94 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 0 Employment — Earnings Source: ADOLWD QCEW KPEDD 2016 Situations & Prospects — Page 66 Looking at all data sources, there are over 1,000 large and small business owners with a low of 1,870 workers in January to a higher of 4,217 employed workers in July in tourism businesses in the KPB. Accommodation and Food Services continues to drive the sector, generating over 80% of the employment and wages. Visitor -oriented businesses and workers include: • 1,427 businesses registered for KPB sales tax purposes (2016) • 1,161 holding Alaska business licenses physically located on the peninsula (2016) • 357 businesses in this sector with average annual employment of 2,726 and $57.8 million in wages in the KPB (2015) (This is approximately 13% of the region's total employment and 6% of the region"s total wages.) • 733 small self-employed small business owner in this sector earning $23.7 million (2014) The state shares a portion of a $5/passenger/port commercial passenger vessel (CPV) excise tax it collects with the 1st seven ports of call in the state, distributing it to boroughs and cities. In FY 2015, this brought $361,658 to the Kenai Borough, $347,733 to Seward, and $13,925 to Homer. Figure 66 - State's Commercial Passenger Vessel (CPV) Tax Total Shared with KPB, Seward, and Homer $8121161 $6821418 $729,950 $723/316 $647,843 2011 2012 2013 2014 2015 Visitors by the Numbers As noted in the Alaska Visitor Statistics Program Report, the number of cruise ship passengers statewide increased significantly from 2014 to 2015. This pattern was evident on the Kenai Peninsula, where cruise ship passengers in 2015 increased by 37% over 2014. Seward had a 19% increase in the number of ship calls, resulting in a 35% increase in cruise passengers visiting the city. The number of port calls and cruise passengers in Homer doubled between 2014 and 2015. KPEDD 2016 Situations & Prospects - Page 67 Figure 67 - Cruise Ship Passengers on the Kenai Peninsula 200,000 160,000 120,000 80,000 ❑ HOMER 40,000 ❑ SEWARD 0 �b lo V 6 rf Source: Cruise Line Agencies of Alaska Increased cruise ship traffic, as well as increased travel overall, translated to a more modest increase in rail traffic on the two trains operated by the Alaska Railroad (Figure 68). • In 2015, the Grandview Cruise Train, which operates between Seward and Anchorage as an alternative to the cruise lines' motor coach service, had a 3.5% increase in passenger traffic in Seward compared to 2014, with most increases in departures from Seward (passengers ending their cruise in Seward and heading to Anchorage by train). • The Alaska Railroad second train line, the Coastal Classic, is open to the public and serves a mix of Alaskan residents, independent travelers, and cruise ship passengers. This train experienced an increase of 12.1% overall in Seward traffic (including both departures and arrivals). Figure 68 - Alaska Railroad Passengers in Seward 90,000 80,000 ❑ Grandview Train 70,000 to/from Seward 60,000 50,000 ❑Coastal Classic 40 000 ' Departures from 30,000 Seward 20,000 10,000 it ®Coastal Classic Arrivals Aff in Seward 2009 2010 2011 2012 2013 2014 2015 Source: Alaska Railroad Corporation KPEDD 2016 Situations & Prospects — Page 68 A number of destinations around the Peninsula also recorded increases in visitor traffic (Figure 69). • The Alaska SeaLife Center in Seward welcomed 149,842 visitors to their aquarium (not including participants in their education programs), a 5% increase from 2014. • Nearly 300,000 people paid a visit to Kenai Fjords National Park in 2015, a 10% increase over 2014 figures. Visitor levels were mixed among Chamber of Commerce -operated visitor centers in Kenai, Homer, and Soldotna. • The Soldotna Visitor Center installed a new motion sensor, resulting in lower measured visitor levels. • The Kenai and Homer Visitor Centers both saw increases in visitors. • Homer's levels of visitor traffic more than doubled, due to both increases in tourism as well as a shortened season in 2014 for Visitor Center renovations. Figure 69 - Annual Visitors to KPB Destinations Chamber of Commerce Visitor's Centers 2011 2012 N/A N/A 16,268 14,238 39,469 38,820 N/A 41,866 346,852 2811279 133,087 138,940 2013 14,000 14,467 43,320 38,707 283,592 143,829 2014 61245 13,061 40,071 35,354 270,666 142,349 2015 14,995 N/A 32,940 41,971 IE 296,697 149,842 Sources: Homer Chamber of Commerce, Seward Chamber of Commerce, Soldotna Chamber of Commerce, Kenai Chamber of Commerce, Alaska SeaLife Center, National Parks Service Kenai Peninsula Outdoors Club views Skilak Lake during November hike. Photo courtesy of Peninsula Clarion, by Dan Balmer KPEDD 2016 Situations & Prospects — Page 69 Sport Fishing, Charters and Guides To review sport fishing trends, data from ADF&G Statewide Harvest Surveys were analyzed for freshwater fishing on Kenai Peninsula streams, along the shoreline of eastern Cook Inlet, and from boats sport fishing in Cook Inlet (Figures 71-73)9. Trends in gross sales activity related to guided land and water activity was also considered. Gross sales from guided land and water activity and businesses in the borough has increased significantly over the last five years and year. Sales increased steeply between 2014 and 2015, rising 14% from guided land sales and 9% from guided water activity (Figure 70). Hizure 70 - Gross Business Sales from Guided Land and Water Activities Guided Land $1,7161669 $1,767,489 $2,701,107 $2,954,865 $3,382,241 14% 97% Guided Water $56,552,908 $57/773,657 $60,368,575 $59,567,601 $651036,445 9% 15% Source: Kenai Peninsula Borough Finance Office, Sales Tax Division All types of sport fishing in the region saw increased numbers of days fished in 2013 and again in 2014 (Figure 71). The number of anglers fishing increased in 2014 for those fishing from shoreline and in freshwater, the number declined for those fishing in saltwater. (Figure 72). In 2014, the average days fishing in freshwater, from the shoreline, and from a boat increased above 2013 levels for all types of fishing, and were estimated at 4.2, 2.4 and 2.0 days, respectively. Average days per angler fishing in freshwater and from a boat in saltwater have increased steadily over five years, but for angling from the shore there has been a small decline over this period. Figure 71- Sport Fishing Days Fished, by Type, 2010-2014 900,000 v 800,000 � 700,000 w 600,000 > 500,000 A 400,000 ° 300,000 200,000 100,000 z 0 2010 2011 2012 2013 2014 0 shoreline 13,297 11,054 71751 13,571 26,815 0 saltwater boat 167,797 168,214 168,040 1921745 196,037 ❑ freshwater 469,614 478,502 476,331 547,120 600,515 Notes: Harvest Estimates are for shoreline and saltwater in Cook Inlet and freshwater on Kenai Peninsula. Does not include freshwater out of Seward or Gulf of Alaska/Resurrection Bay. Also does not include west Cook Inlet drainages. Source: ADF&G, Statewide Harvest Surveil. 9 These analyzes do not include data from freshwater streams or shoreline fishing out of Seward or from west Cook Inlet drainages. Salt fishing in the Gulf of Alaska/Resurrection Ba is also not included. These areas could be added to this review in next year's Situations& Prospects.. KPEDD 2016 Situations & Prospects — Page 70 Figure 73 - Number of Guided and Nonguided Anglers on the Kenai River, 2004-2014 2004 2005 2006 2007 2008 2009 2010 2011 2012 ■ Non -guided ❑ Guided Figure 72 - Kenai Peninsula and East Cook Inlet Sport Fishing, Number of Anglers by Type, 2010-2014 300,000 250,000 X X X X 200,000 X `*150,000 0 v 100,000 Z 50,000 2010 2011 2012 2013 2014 Freshwater Saltwater f Shoreline X Total Notes: Harvest Estimates are for shoreline and saltwater in Cook Inlet and freshwater on Kenai Peninsula. Does not include freshwater out of Seward or Gulf of Alaska/Resurrection Bay. Also does not include west Cook Inlet drainages. Number of angler estimates are not unique because an angler may have visited more than one site. Source: ADF&G, Statewide Harvest Survey. Looking more closely at trends on the Kenai River alone, the number of non -guided anglers has been increasing since 2009, though the 2014 estimated total of 89,453 is off from the 11-year high of 103,700 in 2013. The number of guided sports fishermen on the Kenai River has declined since an 11-year peak in 2011 (Figure 73). 120,000 100,000 80,000 60,000 40,000 20,000 0 2013 2014 Notes: Number of angler estimates are not unique because an angler may have visited more than one site. Source: ADF&G, Alaska Sport Fish Surveil KPEDD 2016 Situations & Prospects — Page 71 Figure 74 - Number of Guided and Nonguided Anglers on the Kenai River, 2014 Kenai River - Cook Inlet to Soldotna Brid e - nonguided 37,028 Kenai River - Soldotna Bridge to Moose River - nonguided 331313 Kenai River - Moose River to Skilak Outlet - nonguided 13,514 98,453 Kenai River - Skilak Inlet to Kenai Lake - nonguided 13,478 Kenai River - reach not specified - nonguided 1,120 Kenai River - Cook Inlet to Soldotna Bridge - guided 11,724 Kenai River - Soldotna Bridge to Moose River - guided 81075 Kenai River - Moose River to Skilak Outlet - guided 51725 34,621 Kenai River - Skilak Inlet to Kenai Lake - guided 8,906 Kenai River - reach not s-Decified - guided 191 Notes: Number of angler estimates are not unique because an angler may have visited more than one site. Source: ADF&G, Alaska Sport Fish Survey ;-� - s Ilk'` s — r " 71" AiC 7 4?& T 262-6064 AM — King salmon fishermen ride upriver during the first day of fishing on the late run of Kenai River king salmon. Photo Courtesy of Peninsula Clarion, by Photo by Rashah McChesney KPEDD 2016 Situations & Prospects — Page 71 10.5 Health Care and Social Assistance Workforce, Wages, Business Activity Everyone needs health care services. With three hospitals, a wellness center, several health clinics, and many allied services and businesses, every dollar spent at one of these local health providers keeps income circulating within the region and supports local jobs. The health care and social assistance workforce was the largest on the Peninsula in 2015 and 2nd highest for total wages and earnings when both wage and salary employees and self-employed small business owners are combined (see Figures 37 and 38 in Chapter 9). The number of local health care and social assistance jobs grew between 2010 and 2014, but then dropped by 71 or 2% in 2015. There are 190 employers with 3,194 employees in a health -related field who earned $134.3 million in 2015. And, there were 273 small businesses owned by a sole proprietor in the field who earned $8 million by providing health and social service activity in 2014. The Alaska Department of Labor's occupational information rates the outlook for virtually all Alaska health care occupations as strong to robust growth, and most occupations have high job openings. Figure 75 - Kenai Peninsula - Health Care & Social Services, Employment & Wages, 2006-2015 3,500 3,000 0 00 2,500 w 2,000 a� 1,500 0 2006 Source: ADOLWD QCEW 030 3, 09 2007 2008 2009 2010 2011 2012 2013 2014 2015 employment —■— earnings $160 $140 $120 $100 $80 $60 $40 $20 $0 KPEDD 2016 Situations & Prospects — Page 73 Figure 76 - Health Care & Social Assistance Employment by Type, Kenai Peninsula, 2015 Source: ADOLWD, C Most sales of health services are tax exempt on the Kenai Peninsula; however, businesses and non -profits must report their gross sales prior to taking their legal exemptions. Only about 6% of all health care related sales are subject to sales tax. Gross sales by health care and social assistance businesses on the Kenai increased by 68% between 2013 and 2014, and then by 7% between 2014 and 2015. The total of $36.5 million is a new high in related sales activity (Figure 77). A significant part of the increased activity can be attributed to construction and furnishing of Central Peninsula Hospital's new Specialty Clinics Building, which provides orthopedic, orthopedic spine, urology, podiatry, oncology infusion, imaging, and cardiology services. Sales activity by the health care and social assistance sector accounts for about 1 % of all gross sales on the Peninsula. Figure 77 - Business Activity - Gross Sales for Health Care & Social Assistance Businesses on Kenai Peninsula, 2010-2015 $40,000,000 $35,000,000 $30,000,000 $25,0001000 $20,000,000 $15,000,000 $10,000,000 $5,000,000 ❑ Outside of Cities + Seldovia ■ Seward m Kenai ❑ Homer ® Soldotna $10,656, 712 $9,101,448 1 $9,101,448 KPEDD 2016 Situations & Prospects — Page 74 The Alaska Department of Labor occupational database shows at least 25 workers on the Kenai Peninsula in each of the following 32 health occupations in 2014: Figure 78 - Health Care Occupations with at Least 25 Workers, on Kenai Peninsula, 2014 Occupation FIM rWers M, Registered Nurses 462 Medical Records and Health Information 49 Technicians Home Health Aides Nursing Assistants Social and Human Service Assistants Healthcare Support Workers, All Other Recreational Therapists Medical Assistants Dental Assistants Medical Secretaries 367 Social and Communitv Service Managers 49 294 Nurse Practitioners 42 285 Family and General Practitioners 41 172 Social Workers, All Other 41 169 Massage Therapists 36 158 Rehabilitation Counselors 36 124 Medical and Clinical Laboratory Technicians 31 111 Pharmacists 30 Medical and Health Services Managers 83 Phlebotomists Physical Therapists 59 Substance Abuse and Behavioral Disorder Counselors Mental Health Counselors 57 Medical Transcriptionists Physicians and Surgeons, All Other 52 Speech -Language Pathologists Pharmacy Technicians 51 Veterinary Assistants and Laboratory Animal Caretakers Radiologic Technologists 50 Mental Health and Substance Abuse Social Workers Dental Hienists 49 Veterinary Technologists and Technicians Source: ADOLWD Occupational Worker Database Health Insurance 29 27 26 26 26 25 25 According to the 2010-2014 American Community Survey, 11,843 residents or about 20% of borough residents do not have health insurance coverage. Of those that have insurance, 27% receive public coverage (Medicaid, Medicare, VA) and the remainder have coverage from private insurers. Figure 79 - Health Coverage by Type, Kenai Peninsula F Number of Insured by Percent insured Margin of MarN ErrorEstimate 1 PRIVATE HEALTH INSURANCE 34,014 +/-1,007 61.3% +/-1.8 PrivatP health inc»rancP alnnP 26 678 +/-942 48 1010 Employment -based health insurance Direct -purchase health insurance TRICARE/military health coverage PUBLIC COVERAGE Public coverage alone 11 Medicare coverage Medicaid/means-tested public coverage VA Health Care UNINSURED Source: 2010-2014 ACS 5-uear Su 30,890 +/-1,053 55.7% 3, 941 1,429 15,502 7,660 81270 81284 21010 11,843 +/-444 +/-306 +/-737 +/-719 +/-232 +/-710 +/-241 +/-813 7.1 % 2.6% 27.9% 13.8% 14.9% 14.9% 3.6% 21.3 % y (S2701), Kenai Peninsula Borough +/-1.9 +/-0.8 +/-0.6 +/-1.7 +/-1.3 +/-1.3 +/-0.4 KPEDD 2016 Situations & Prospects — Page 75 Major Health Care Providers The Central Peninsula Hospital (CPH) located in Soldotna is an acute care hospital owned by Kenai Peninsula Borough (KPB), which leases the facility and its operations to CPH. CPH is a private nonprofit corporation governed by an appointed 11-member volunteer Board. CPH services a significant portion of the Kenai Peninsula population totaling over 40,000 including the Kenai, Soldotna, and Sterling areas. There are a number of facilities and services under the CPH umbrella including the 49-bed Hospital, the 60-bed Heritage House with long-term skilled nursing care, six family and specialty physician services clinics, and the new $43 million River Pavilion building. The River Pavilion opened in early 2016 and provided growing room for cancer oncology and infusion care, The Spine Center, and other programs. The hospital provides emergency medical services regardless of ability to pay and also promotes wellness services for all. South Peninsula Hospital (SPH) in Homer is a Critical Access Hospital (CAH) was named a Top 100 CAH in 2011. It has an emergency room, 22-bed acute care beds, and several other health and wellness services. They also run a 28-bed long term and extended care facility. The facility is a non-profit organization governed by a Board of Directors. SPH is also owned by the KPB, which leases the SPH facility and operations to South Peninsula Hospital, Inc., a private, nonprofit corporation governed by an appointed nine -member volunteer board. SPH serves a 13,500-population base on Kenai Peninsula, including the Homer, Anchor Point, Seldovia, and other communities across the bay. Providence Seward Medical and Care Center (PSMC), located in Seward is a six -bed Critical Access Hospital (CAH) with separate skilled nursing facility. It is owned by the City of Seward, which leases the PSMC facility and its operations to Providence Health and Services (PHS), a Washington nonprofit corporation with affiliated facilities throughout AK including Anchorage, Valdez, and Kodiak. Under its operating agreement, PHS manages PSMC while all financial risk and rewards from the operations remain with the City. KPB health - related powers do not extend to PSMC. This facility serves a population of about 5,000 comprised primarily of Seward area residents. The Dena'ina Wellness Center is a 52,000 sf facility incorporating traditional Kenaitze design elements that opened in 2014 in Kenai. It offers medical, dental, behavioral health, chemical dependency, wellness, physical therapy, pharmacy support and traditional healing services all beneath one roof for Alaska Native/American Indian beneficiaries on the Peninsula. Sector Trends, Issues, and Outlook A Sustainable Future for Kenai Health Care Facilities, Providers, and Services in an Evolving Health Care Market The biggest health care challenge for the Kenai region will be to maintain or enhance the services it has in rapidly changing ways of doing business in health care. At the 2016 Industry Outlook Forum, Rick Davis, CEO of Central Peninsula Hospital said, "Alaska is failing to prepare, so we are preparing to fail." The Kenai Peninsula Borough recently critically reviewed health care challenges and opportunities. The analysis's executive summary (Stroudwater, 2016) notes that the national healthcare industry is moving rapidly from a Fee for Service (FSS) model to a Patient Based Payments for Services (PBPS) and the bottom line of hospitals will be threatened by payment reductions and utilization declines. While PBPS has not reached Alaska, several emerging factors call for its adoption. Other stressors pushing change are the current Alaska state deficit that will force the Medicaid program to change, likely including reduced payments and/or reduced services. In addition, private healthcare insurance in Alaska costs are the highest in the nation (with prices still increasing) and one of only two insurers announcing in May 2016 that they will leave the market; all of which is a significant threat to not only health care providers but also to other businesses. Other changes already occurring on the KPEDD 2016 Situations & Prospects — Page 76 Kenai Peninsula include quality/patient safety as a new driver of hospital market share and reimbursement as well as payment cuts that are real forcing increased efficiency. The Stroudwater report finds that the service areas of all three Kenai Peninsula hospitals are distinctly separate due to geographic location, are supported by communities that are staunchly independent, and that advantages of Borough -wide ownership are limited from a cost -reduction perspective, but are valuable for developing an alignment strategy. And, an alignment strategy may well be key to meeting existing and future challenges in a rapidly evolving health care market, to and to ensure the ability to maintain or expand health care services on the peninsula in a financially sustainable manner. The report recommends engaging in a regional alignment effort to best position the KPB healthcare delivery system to achieve priorities while maintaining maximum flexibility in the rapidly changing healthcare environment. There is opportunity to position the Kenai Peninsula hospitals for the future by addressing individual hospital opportunities, seeking Kenai Peninsula -wide efficiencies, and aligning hospitals with physicians, capital/insurance partners, and other partners. This could be a pilot project to form a Coordinated Care Organization and move toward "global payments" for health services. This type of system incentivizes focus on more efficient service to a patient's holistic health needs. This will not be easy and involves risk -sharing among partners. It also offers significant rewards and opportunity, including the possibility of the region serving as a demonstration area and leading the state. Growing Senior Population In just one year, from 2014 to 2015, the Kenai Peninsula's population age 65 and older increased by 5%, from 8,161 to 8,594. The population age 80 and older increased by 4%. The Alaska Department of Labor and Workforce Development projects a continued increase in this demographic though 2030, a challenge faced by communities throughout Alaska as the Baby Boom population continues to age. By 2045, those age 65 or older will be 21% of the borough's total population while those age 85 or older are projected to be 9%. Providing services for this extremely fast growing demographic is something has increased demand from CPH and other providers. These patients are also requiring more of family members who are now finding themselves taking care of their aging family members. Many of these patients would be better served by home health and hospice services if they were more available. As the senior population grows, demand will increase for services to assist people to age in place, for traditional assisted living and long-term care, for home health, hospice, palliative care, respite care, and related services. Needs of Future Gas Pipeline Workforce Another important future concern is the impact to health care and social assistance facilities and providers needs if the gas pipeline is built and terminates in Nikiski with an LNG k ' , irT • p 1 a 74 ak: Seward's Providence Hospital, Photo by Barbara Sheinberg KPEDD 2016 Situations & Prospects — Page 77 plant. Expanding hospital and health care services cannot be done overnight. Current thinking is that this could mean an increase of 5,000 or more people on the Kenai, which would create a demand for 10-25 more hospital beds or related space at a rough cost of $100 million. This type of expansion typically needs a 15-year planning window, yet if the gasline goes there will not be 15 years to plan and meet service demands. Other Challenges • Demand for mental health and substance abuse services exceeds capacity • Demand for cardiology services that is now unmet • Reduce the outmigration of services, e.g. approximately 50% of joint replacement orthopedic cases are captured in Anchorage • Geography does not lend itself to natural connection with Seward. Seward is closer to Soldotna, yet it is faster to get to Anchorage. There is a significant lack of continuity of EMS with large geographic areas covered by volunteers. For example, approximately 95% of PSMC's medical transport is conducted via air instead of ground. • Limited access to continuing care services. For example, Seward has a single small capacity Assisted Living facility, no Home Health Aides; Soldotna lacks hospice services. • Lack of awareness in Seward regarding healthcare service offerings available in Soldotna • Lack of obstetrical care in Seward requires majority of patients to be cared for away from home: referral trend is 90% to Anchorage / 10% to Soldotna • The current system of care is not focused on prevention. Resources are not in place to fully support population health. Opportunities for Collaboration • Coordinate purchasing / supply chain distribution • Management support / expertise • Contracted services (laundry, credentialing, legal, etc.) • Share specialists (PSMC is currently supported by the following Anchorage -based specialists: OB, Ortho, ENT, GI, Cardio) • Telehealth • Recruitment of providers and staff (shared staffing) • Shared education and training (staff, leadership, medical staff, Board) • IT integration • Payer contracting and negotiations Central Peninsula Hospital's new Specialty Clinics Building„ Photo by Barbara Sheinberg KPEDD 2016 Situations & Prospects — Page 78 11 Borough and City Profiles 11.1 Kenai Peninsula Borough All Source Data: US Census American Community Survey, 5-Year Estimates 2009-2013, 2010-2014, unless noted otherwise. Figure 80 - Socioeconomic Profile, Kenai Peninsula Borough FSubj ect P 2009-20010-2014** POPULATION Population 1 57,212 ('14) 571763 ('15) # PFDs 2 53,217 (' 13) 53,656 (' 14) Kenai Peninsula School District Enrollment 3 9,150 (' 14/' 15) 9,132 (' 15/' 16) HOUSING Total housing units r Occupied housing units p g Vacant housing units Median value of owner-occuDied units Median monthly rent (for renters) Households spending more than 30% of income on housing For homeowners with a mortgage For homeowners without a mortgage For renters EMPLOYMENT STATUS Population 16 years and over In civilian labor force Employed Unemployed In Armed Forces Not in labor force Class of Worker p. Civilian employed population 16 years and over Private wage and salary workers Government workers Self-employed in own not -incorporated biz. workers Unpaid family workers INCOME AND BENEFITS Total households Median household income Mean household income Households with... Earnings Social Security Retirement income Supplemental Security Income Cash public assistance income Food Stamp/SNAP benefits in the Total Families Median family income Mean family income Per capita income 4 (single year data, source: BEA ast 12 months 30,498 21,720 8,778 $204,900 $917 2,947 700 2,091 100% 30,638 100% 71.2% 21559 70.400 28.8% 91079 29.6% $210,400 31.6% $938 29.1% 21718 10.9% 757 11.9% 39.7% 2,156 41.4% 44,681 100% 45,114 100% 28,228 63.4% 28,354 62.8% 25,455 57.0% 25,678 56.9% 2,773 6.2% 2,676 5.9% 121 0.3% 36.6% 134 16,626 0.3% 16,332 36.9% 25,455 100.0% 18,097 71.1 % 25,678 100% 18,632 72.6% 4,735 18.6% 4,475 17.4% 21549 10.0% 2,510 9.8% 74 0.3% 61 0.2% 21,720 - 21,559 $61,793 - $63,099 $77,022 - $78,020 17,751 5,912 4,178 837 1,227 1,890 14,479 $75,689 $90,449 $48,012 81.74% 27.2% 19.2% 3.9% 5.9% 8.7% 17,305 6,153 4,161 947 1,261 1,762 14,112 $77,352 $91,692 $50, 760 80.3% 28.5% 19.3% 4.4% 5.8% 8.2% '14 KPEDD 2016 Situations & Prospects - Page 79 • 11' 1 1 1 1 HEALTH INSURANCE COVERAGE Civilian noninstitutionalized population 55,029 - 55,484 With health insurance coverage 42,561 78.2% 43,641 78.7% Without health insurance coverage 12,468 21.8% 11,843 21.3% BELOW FEDERAL POVERTY LEVEL All families - 5.1 % 5.8% Families with female householder, no husband present - 15.0% 16.9% All people - 8.6% 9.3% EDUCATIONAL ATTAINMENT Population 25 years and over 38,242 100% 38,636 100% Less than 9th grade 2.4% 2.2% 9th to 12th grade, no diploma 4.8% 4.5% High school graduate (includes equivalency) 31.7% 32.4% Some college, no degree 30.0% 29.9% Associate's degree 7.5% 7.7% Bachelor's degree 15.7% 15.3% Graduate or professional degree 8.0% 8.0% **Unless otherwise noted, data is from 2009-2013 and 2010-2014 US Census American Community Survey 5-Year Estimate. Note that the 2015 Situations & Prospects comparable figure (Figure 13) listed 2011-2013 3-year ACS data. We now know that 2011-2013 was the last year that the US Census published 3-year estimates. These were previously available for places with a population between 20,000- 65,000. Annual (1-Year) data is available for places with population over 65,000; all other areas are now covered by the 5-year ACS Surveys. Data is this table for the previous year has been changed to 2009-2013 5 year data so that comparable data sets are being compared. 1 ADOLWD, Population Estimates 2 PFDs reported by zip code, ADOR 3 # Students enrolled in School District, ADEED 4 Bureau of Economic Analysis CA 30 Profile Figure 81- Kenai Peninsula Borough Tax Revenue Saleso.- ., Rate Revenue Mill Rate •:1 �. 2015 3% $30,040,682 4.5 mills —borough. $47,750,273 $10,326,610 $58,076,883 ° 2014 3% $30,277,598 Borough+ cities rate $491372,199 $9,294,743 $58,666,942 2009 3% $28,5851036 varies from 5.0 to $46,2861259 $6,618,858 $521905,117 2004 2% $14,910,977 11.30 in 2015 $37,752,405 $7,946,360 $45,698,765 Source: DCCED Alaska Taxable Data Base Kenia Peninsula Borough gross and taxable sales can be reviewed in chapter 9 KPEDD 2016 Situations & Prospects — Page 80 11.2 City of Homer All Source Data: US Census American Community Survey, 5-Year Estimates 2009-2013, 2010-2014, unless noted otherwise Figure 82 - City of Homer Socioeconomic Data 1 1 ' 1 �1� [ID►�1� L' of % of POPULATION Total Total Population 1 5,099 (' 14) - 51153 (' 15) - # PFDs 2 (in zip code 99603) 91554 ('14) - 91691 ('15) - School Enrollment, all schools in City of Homer 3 11180 (' 14/' 15) - 11165 (' 15/' 16) - HOUSING Total housing units 21747 - 21691 Occupied housing units 21207 80.3% 21122 78.9% Vacant housing units 540 19.7% 569 21.1 % Median value of owner -occupied units $262/400 - $261,000 - Median monthly rent (for renters) $892 - $914 - Households spending more than 30% of income on housing For homeowners with a mortgage ME - 285 34.7% For homeowners without a mortgage ME - 85 16.8% For renters ME - 392 52.8% EMPLOYMENT STATUS Population 16 years and over 41082 - 41161 In civilian labor force 2,528 61.9% 21651 63.7% Unemployed 175 4.3% 189 4.5% Working 21353 57.6% 21462 59.2% Private wage and salary workers 11557 66.2% 11653 67.1% Government workers 407 17.3% 430 17.5% Self-employed in own not -incorporated biz. workers 381 16.2% 368 14.9% Unpaid family workers 8 0.3% 11 0.4% In Armed Forces 37 0.9% 33 0.8% Not in labor force 11517 37.2% 11477 35.5% INCOME AND BENEFITS (in 2013 and 2014 inflation -adjusted dollars) Total households 21207 - 21122 - Median household income $53,750 - $54,778 - Mean household income $72,703 - $73,852 - Households with... Earnings 11763 79.9% 11680 79.2% Social Security 621 28.1 % 606 28.6% Retirement income 399 18.1 % 378 17.8% Supplemental SecurityIncome 92 4.2% 101 4.8% Cash public assistance income 189 8.6% 160 7.5% Food Stamp/SNAP benefits in the past 12 months 215 9.7% 209 9.8% Total Families 11246 - 1,246 - Median family income $74,583 - $74,808 - Mean family income $91,596 - $91,352 - Per capita income $32,046 - $311237 - KPEDD 2016 Situations & Prospects - Page 81 HEALTH INSURANCE COVERAGE Civilian noninstitutionalized population 5,085 - 5,173 With health insurance coverage 3,865 76.0% 3,939 76.1 % Without health insurance coverage 1,220 24.0% 1,234 23.9% BELOW FEDERAL POVERTY LEVEL All families - 6.6% 8.3% Families with female householder, no husband present - - ME - All people - 10.2% 12.1 % EDUCATIONAL ATTAINMENT Population 25 years and over 31555 - 31519 - Less than 9th grade - 0.6% - 0.6% 9th to 12th grade, no diploma - 3.8% - 4.1% High school graduate (includes equivalency) - 21.9% - 23.2% Some college, no degree - 32.2% - 31.6% Associate's degree - 9.1 % - 9.0% Bachelor's degree - 20.6% - 19.0% Graduate or professional degree - 11.8% - 12.5% ME - Margin of error exceeds 6%, not reported 1 ADOLWD 2 Reported by zip code, ADOR 3 # Students enrolled in schools within city boundary, ADEED Fiv-ure 83 - Citv of Homer Tax Revenue Sales Rate 3.5% Tax Revenue $4,353,146 Mill Rate 13.35 4.5% $7,600,739 11.3 4.5% $7,3991059 11.3 4.5% $7,484,925 11.3 0 $85,866 0 -$227,018 Revenue $1,742,434 $2,980,980 $3,220,859 $2,993,841 Property Oil &Gas Tax $0 $0 $181,087 0 -$181,087 Revenue Total $1,742,434 $2,980,980 $3,401,946 $2,993,841 -$408,105 Source: DCCED Alaska Taxable Data Base KPEDD 2016 Situations & Prospects — Page 82 Figure 84 - Gross Business Sales in City of Homer (in $1000s) Admin, Waste Mgmt $21,554 $17,534 $171430 $15,014 Ag, Forestry, Fishing, Hunting $221 $161 $209 $305 Arts & Entertainment $1,167 $1,206 $11238 $1,289 Construction Contracting $27,237 $34,242 $39,968 $44,477 Educational Svs $288 $302 $274 $288 Finance & Insurance $113 $107 $99 $87 Guiding Land $142 $124 $446 $121 Guiding Water $10,676 $10,686 $11,353 $10,566 Health Care, Social Asst $4,785 $5,509 $5,376 $5,029 Hotel/Motel/B&B $13,481 $13,875 $14,419 $15,786 Information $7,390 $6,917 $6,735 $6,618 Mgmt of Companies $0 $0 ' Manufacturing $7,798 $9,237 $7,660 $7,953 Mining/Quarrying Prof, Scientific & Technical Svs $6,341 $8,084 Public Admin $4,639 $5,078 Remediation Svs $420 Rental Commercial Prop $1,054 $942 Rental Non -Residential Prop $828 $900 Rental Self -storage & Miniwarehouses $2,159 $2,451 Rental Personal Prop $976 $907 Rental Residential Prop $10,467 $11,321 Restaurant/Bar $16,120 $16,012 Retail Trade $163,337 $167,112 Services $16,726 $20,595 Telecommunications $2,136 $1,707 Timbering Trailer Court Transportation, Warehousing $24,657 $28,624 Utilities $41,979 $48,569 Wholesale Trade $18,995 $18,366 $10,097 $10,053 $5,265 $5,248 $516 $455 $935 $895 $11181 $11282 $2,659 $2,726 $875 $1,108 $11,619 $11,330 $17,229 $18,410 $162,593 $165,449 $24,813 $23,506 $1,677 $1,923 $15,988 $31,492 $49,358 $13,526 $25,956 $24,740 GRAND TOTAL $405,367 $431,017 $436,004 $419,675 Annual % change 13.1% 6.3% 1.2% -3.7% Source: Kenai Peninsula Borough Finance Dept 'confidential $15,226 $361 $1,493 $31,409 $283 $74 $213 $10,956 $4,905 $16,968 $6,762 $5,122 $9,003 $8,594 $207 $1,084 $1,390 $2,577 $1,021 $13, 775 $20,041 $1541414 $24,329 $1,546 $32,940 $14,014 $24,394 $403,102 -3.9% $212 $56 $204 -$13,068 -$4 -$13 $91 $390 -$124 $1,182 $144 -$2,831 -$1,049 $3,346 4248 $188 $108 -$149 -$87 $2,445 $1,631 -$11,035 $824 -$377 *I $1,448 $488 -$346 -$16,573 KPEDD 2016 Situations & Prospects - Page 83 11.3 City of Kenai All Source Data: US Census American Community Survey, 5-Year Estimates 2009-2013, 2010-2014, unless noted otherwise Figure 85 - City of Kenai Socioeconomic Data AEL 2009 12010-201iE=. %of Total POPULATION % of Total Population 1 71167(' 14) - 71229 (' 15) - # PFDs2 (in zip code 99611) 12,653 (114) - 12,911 (115) - School Enrollment, all schools in City of Kenai 3 1,875(' 14/' 15) - 1,885 (15/' 16) - HOUSING Total housing units 31108 - 31221 Occupied housing units 21820 90.7% 21896 89.9% Vacant housing units 288 9.3% 325 10.1% Median value of owner -occupied units $184,800 - $193,900 - Median monthly rent (for renters) $885 - $910 - Households spending more than 30% of income on housing For homeowners with a mortgage 328 30.5% 339 30.3% For homeowners without a mortgage 52 9.4% 46 8.6% For renters 390 35.9% 456 F-40.8% EMPLOYMENT STATUS Population 16 years and over 51608 - 51705 - In civilian labor force 31915 69.8% 3,834 67.2% Unemployed 437 7.8% 404 7.1% Working 31478 62.0% 31430 60.1% Private wage and salary workers 21664 76.6% 2,674 78.0% Government workers 561 16.1% 554 16.2% Self-employed in own not -incorporated biz. workers 253 7.3% 202 5.9% Unpaid family workers 0 0.0% 0 0.0% In Armed Forces 0 0.0% 0 0.0% Not in labor force 11693 30.2% 11871 32.80% INCOME AND BENEFITS (in 2013 and 2104 inflation -adjusted dollars) Total households 21820 - 2,896 - Median household income $63,019 - $62,088 - Mean household income $78,137 - $78,824 - Households with... Earnings 21390 84.8% 2,339 80.8% Social Security 634 22.5% 713 24.6% Retirement income 511 18.1% 490 16.9% Supplemental Security Income 184 6.5% 242 8.4% Cash public assistance income 165 5.9% 196 6.8% Food Stamp/SNAP benefits in the past 12 months 271 9.6% 278 9.6% Total Families 11870 - 11833 - Median family income $76/815 - $76/445 - Mean family income $89,140 - $921768 Per capita income $311710 - $32,471 - KPEDD 2016 Situations & Prospects - Page 84 HEALTH INSURANCE COVERAGE Civilian noninstitutionalized population 71230 - 7,321 With health insurance coverage 51417 74.9% 5,562 76.0% Without health insurance coverage 11813 25.1% 11759 24.0% BELOW FEDERAL POVERTY LEVEL All families - 3.7% - 4.8% Families with female householder, no husband present ME - ME - All people - 9.40% - 11.1 % EDUCATIONAL ATTAINMENT Population 25 years and over 41662 - 4,766 - Less than 9th grade - 1.8% - 1.8% 9th to 12th grade, no diploma - 5.1 % - 6.4% High school graduate (includes equivalency) - 35.6% - 35.2% Some college, no degree - 27.4% - 26.4% Associate's degree - 7.9% - 7.0% Bachelor's degree - 12.8% - 13.3% Graduate or professional degree - 9.4% - 9.9% ME - Margin of error exceeds 6%, not reported 1 ADOLWD 2 PFDs reported by zip code, ADOR 3 # Students enrolled in schools within city boundary, ADEED Figure 86 - City of Kenai Tax Revenue -. -1 I'll 11� 11' 1 1 1 � 1 Change115 Sales Rate 3% 3% 3% 3% 0% Revenue $3,6801000 $5,3721499 $6,623,650 $7,136,866 $513,216 Tax 9 8.86 8.86 0 Mill Rate 12.1 Property Tax Revenue Oil and Gas Revenue $1,950,156 $ 26 130 $2,550,238 $3,204,551 $3,147,836 -$56,715 68 005 $' 90 104 191 845 259 850 $ $ $ Total Tsl,976,286 $2,640,342 F$3,396,396 $3,407,686 $11,290 Source: DCCED Alaska Taxable Data Base KPEDD 2016 Situations & Prospects — Page 85 Admin, Waste Mgmt Figure 87 - Gross Sales in City of Kenai (in $1000s) $3,024 $3,090 $3,615 $3,059 I Ag, Forestry, Fishing, Hunting $319 $359 $463 $244 Arts & Entertainment $750 $738 $604 $596 Construction Contracting $311488 $51,662 $61,791 $50,241 Educational Svs $310 $362 $643 $884 Finance & Insurance $659 $584 $572 $687 F Guiding Land Guiding Water $513 $719 $361 $374 Health Care, Social Asst $624 $375 $326 $452 Hotel/Motel/B&B $7,798 $9,659 $9,759 $10,535 Information $10,894 $10,750 $10,656 $10,962 Mgmt of Companies $0 $0 $0 Manufacturing $39,115 $22/286 $25/157 $19,252 Mining/Quarrying $9,770 $5,001 $4,519 $6,400 Prof, Scientific & Technical Svs $11/419 $14,704 $12,552 $14,270 Public Admin $4,408 $4,749 $5,158 $5,509 r _ Remediation Svs Rental Commercial Pro p $833 $611 $618 $826 _ Rental Non -Residential Prop $3,961 $4,884 $4,260 $4,456 Rental Self -storage & Miniwarehouses Rental Personal Pro - Rental Residential Prop Restaurant/Bar Retail Trade Services r Telecommunications Transportation, Warehousing Utilities Wholesale Trade GRAND TOTAL $871 $845 $11,368 $12,220 $14,234 $14,287 $267,720 $276,010 $7,334 $8,119 $1,807 $1,780 $15,127 $17,042 $3,594 $535 $228 -$16 $508 -$88 $78,423 $28,182 $808 -$76 $912 $225 $440 $1,636 $10,609 $11,587 $0 $34,337 $5,060 $13,213 $5,770 $1,165 $4,087 $176 $455 $347 $418 $12,170 $15,273 $16,730 $14,362 $14,893 $14,829 $269,715 $282,790 $287,531 $7,901 $9,218 $9,886 $1,685 $2,473 $3,054 1�19.79n 1�11 _W;7 '11.899 $18,489 $34,499 $46,216 $40,737 $47,728 $53,846 $76,385 $78,681 $73,172 $62,988 $516,682 $571,720 $584,960 $581,506 $629,610 Annual % change 25.65% 10.65% 2.32% -0.59% Source: Kenai Peninsula Borough Finance Dept 'confidential 8.27% $67 $74 $624 $0 $15,085 -$1,340 -$1,058 $262 $339 -$369 $71 $1,457 -$64 $4,740 $668 $36 $6,991 -$10,183 $48,104 KPEDD 2016 Situations & Prospects - Page 86 11.4 City of Seldovia A demographic profile is not presented for the City of Seldovia because the population is small enough that the 2010-2014 American Community Survey margin of error is high and renders the data unreliable. Fieure 88 - Citv of Seldovia Tax Revenue 06k- A j"w--AaWL &=L Change Rate 2.5%/4.5% 2.5%/4.5% 2.5%/4.5% 2.5%/4.5% 0% Sales Tax Revenue $107,299 $76,970 $128,487 $117,065 -$11,422 Mill Rate 13.85 9.1 9.85 9.85 0 $126,554 $213,696 $181,013 -$32,683 Revenue $146,451 Property Oil and Gas Tax $ 0 $ 0 $ 0 $ 0 0 Revenue Total j $146,451 T$1261554 1 $213,696 $181,013 -$32,683 Source: DCCED Alaska Taxable Data Base KPEDD 2016 Situations & Prospects — Page 87 Figure 89 - Gross Sales for City of Seldovia (in $1000s) Admin, Waste Mgmt Ag, Forestry, Fishing, Hunting Arts & Entertainment Construction Contracting Educational Svs Finance & Insurance Guiding Land Guiding Water Health Care, Social Asst Hotel/Motel/B&B Information Manufacturing Prof, Scientific & Technical Svs Public Admin Rental Commercial Prop Rental Non -Residential Prop Rental Self -storage & Miniwarehouses Rental Personal Prop Rental Residential Prop Restaurant/Bar $49 $58 $31 $1,314 $870 $990 $237 $273 $253 $54 $0 $0 $180 $193 $163 $389 $427 $398 $146 $325 $343 $217 $299 $317 $1,237 $69 $52 $54 $91 $836 $735 $638 $300 Retail Trade $778 $645 $798 $818 Services $166 $37 $31 $144 Telecommunications Transportation, Warehousing Utilities Wholesale Trade GRAND TOTAL $41217 $3,614 $3,699 $41675 Annual % change -33.8% -14.3% 2.4% 26.4% Source: Kenai Peninsula Borough Finance Dept 'confidential $16 $775 -46 -415 $221 4 $452 153 $284 -33 $0 $448 -789 $203 $39 -52 $323 22 $1,027 209 $101 -43 $332' $41224 -451 -9.6% KPEDD 2016 Situations & Prospects — Page 88 11.5 City of Seward All Source Data: US Census American Community Survey, 5-Year Estimates 2009-2013, 2010-2014, unless noted otherwise Figure 90 - City of Seward Socioeconomic Data 2009 - 2013 2010-2014 %of Total MEMN POPULATION % of Total Population 1 21768 ('14) - 2,740 ('15) - # PFDs 2 (in zip code 99664) 31900 (' 14) - 31982 (' 15) - School Enrollment, all schools in City of Seward (Oct 1, 2015 ) 3 611 (' 14/' 15) - 634 (' 15/' 16) - HOUSING Total housing units 11210 - 1,165 - Occupied housing units ME - ME - Vacant housing units ME - ME - Median value of owner -occupied units $176,300 - $181,700 - Median monthly rent (for renters) $724 - $721 - Households spending more than 30% of income on housing For homeowners with a mortgage ME - ME For homeowners without a mortgage ME - ME For renters ME - ME - EMPLOYMENT STATUS Population 16 years and over 21386 - 2,327 - In civilian labor force ME - ME Unemployed 91 - 101 - Working ME - - Private wage and salary workers ME - ME - Government workers ME - ME Self-employed in own not -incorporated biz. workers 87 7.7% 102 9.0% Unpaid family workers 9 0.8% 7 0.6% In Armed Forces 7 - 7 0.3% Not in labor force ME - ME - INCOME AND BENEFITS (in 2015 inflation -adjusted dollars) Total households 975 - 939 - Median household income $46,971 - $49/432 - Mean household income $72/889 - $72,416 - Households with... ME - ME - Earnings ME - ME - Social Security ME - ME - Retirement income ME - ME - Supplemental Security Income 28 2.9% 0 0% Cash public assistance income ME - ME - Food Stamp/SNAP benefits in the past 12 months ME - ME - Total Families 530 - 493 - Median family income $75,114 - $69,158 - Mean family income $99,462 - $95,933 - Per capita income $28,902 - $30,076 - KPEDD 2016 Situations & Prospects — Page 89 HEALTH INSURANCE COVERAGE Civilian noninstitutionalized population 21325 - 2,226 With health insurance coverage ME - ME - Without health insurance coverage ME - ME - BELOW FEDERAL POVERTY LEVEL All families - 2.8% - 3.2% Families with female householder, no husband present ME - ME - All people - 4.2% - 5.5% EDUCATIONAL ATTAINMENT Population 25 years and over 21160 - 21088 - Less than 9th gradAe - 3.1 % - 1.7% 9th to 12th grade, no diploma - 5.5% - 6.2% High school graduate (includes equivalency) ME - ME - Some college, no degree ME - ME - Associate's degree - 3.0% - 4.2% Bachelor's de ree ME - ME - Graduate or professional degree ME - - 6.7% ME - Margin of error exceeds 6%, not reported 1 ADOLWD 2 PFDs reported by zip code, ADOR 3 # Students enrolled in schools within city boundary, ADEED Figure 91- City of Seward Tax Revenue Sales Tax Rate 4% 4% 4% 4% 0% - Revenue $2,674,839 $4,138,995 $4,584,701 $4,535,707-$48,994 Mill Rate 10.22 8.12 8.37 8.37 $0 Revenue $670,297 $953,957 $1,276,897 $986,448-$290,449 Property Oil and Gas Tax $0 $0 $0 $0 $0 Revenue Total $670,297 $953,957 $1,276,897 $986,448 j -$290 f449 Source: DCCED Alaska Taxable Data Base KPEDD 2016 Situations & Prospects — Page 90 figure yZ - Gross Sales for Laity of Seward (in $IUUUs) Admin, Waste Mgmt $11772 $2,077 $2,514 $2,173 $2,333 -$160 Ag, Forestry, Fishing, Hunting $10 $27 $24 Arts & Entertainment $616 $252 $58 $61 $77 -$16 -$26,991 Construction Contracting $23,956 $29,769 $26,040 $13,395 $40,386 Educational Svs $57 $56 $39 $25 $11 $14 Finance & Insurance $446 $144 $47 $20 $21 -$1 Guiding Land $149 $151 $604 $656 $536 $120 Guiding Water $21,080 $20,968 $23,936 $23,622 $26,955 -$31332 Health Care, Social Asst $1,225 $1,165 $1,310 $1,639 $1,676 -$37 -$11895 Hotel/Motel/B&B $11,601 $12,604 $13,892 $13,710 $15,605 -$130 Information $3,845 $3,644 $3,705 $3,644 $3,774 Manufacturing $16,136 $20,175 $16,941 $16,279 $12,064 $41214 Mining/Quarrying *'� Prof, Scientific & Technical Svs $11,314 $10,257 $8,624 $7,707 $6,752 $955 Public Admin $7,076 $7,366 $7,399 $7,207 $7,687 -$480 Remediation Svs Rental Commercial Prop $1,516 $1,973 $1,845 $1,791 $2,635 -$844 Rental Non -Residential Prop $262 $348 $426 $308 $429 -$121 Rental Self -storage & Miniwarehouses $257 Rental Personal Prop $149 $160 $133 $128 $151 -$23 $69 Rental Residential Prop $5,397 $5,257 $7,865 $7,023 $6,953 -$11171 -$31120 Restaurant/Bar $11/132 $12,005 $13,192 $13,949 $15,120 Retail Trade $51,417 $52,178 $54,276 $54/256 $57,376 Services $10,434 $17,973 $14/361 $16,793 $23,913 -$71119 Telecommunications $493 $480 $396 $513 $606 -$93 Transportation, Warehousing $4,631 $7,127 $9,722 $10/477 $12,091 -$11614 -$41 Utilities $4,835 $4,876 -$632 Wholesale Trade $26,292 $31/537 $31/627 $39/147 $39,779 -$42,682 GRAND TOTAL $210,994 $237,677 $238,980 $239,382 $282,064 Annual % change 13.1% 12.6% 0.5% 0.2% 17.8% Source: Kenai Peninsula Borough Finance Dept *confidential KPEDD 2016 Situations & Prospects - Page 91 11.6 City of Soldotna All Source Data: US Census American Community Survey, 5-Year Estimates 2009-2013, 2010-2014, unless noted otherwise Figure 93 - City of Soldotna Socioeconomic Data AM 11' 1 IN&W 1 1 1 POPULATION %of Total % of Total Population 1 41311 (' 14) - 41319 (' 15) - # PFDs 2 (in zip code 99669) 14,473 (' 14) - 14,523 (' 15) - School Enrollment, all schools in City of Soldotna 3 21836 (' 14/' 15) - 2,862 (` 15/' 16) - HOUSING Total housing units 11844 - 11828 - Occupied housing units 11669 90.5% 11651 90.3% Vacant housing units 175 9.5% 177 9.7% Median value of owner -occupied units $213,800 - $221/300 - Median monthly rent (for renters) $990 - $988 - Households spending more than 30% of income on housing For homeowners with a mortgage ME - ME - For homeowners without a mortgage ME - ME - For renters ME - ME - EMPLOYMENT STATUS Population 16 years and over 3,323 - 3,433 - In civilian labor force 21007 60.4% 2,142 62.4% Unemployed 256 7.7% 237 6.9% Working 11751 52.7% 11905 55.5% Private wage and salary workers 1,474 84.2% 1,565 82.2% Government workers 236 13.5% 268 14.1 % Self-employed in own not -incorporated biz. workers 41 2.3% 72 3.8% Unpaid family workers 0 0.0% 0 0.0% In Armed Forces 0 0.0% 0 0.0% Not in labor force 1,316 39.6% 1,291 37.6% INCOME AND BENEFITS (in 2014 inflation -adjusted dollars) Total households 1,669 - 1,651 - Median household income $54,931 - $63/068 - Mean household income $77,447 - $82,021 - Households with... Earnings 1,337 80.1% 1,330 80.6% Social Security 497 29.8% 500 30.3% Retirement income 314 18.8% 353 21.4% Supplemental Security Income 111 6.7% 149 9.0% KPEDD 2016 Situations & Prospects - Page 92 Cash public assistance income 131 7.8% 143 8.7% Food Stamp/SNAP benefits in the past 12 months 199 11.9% 167 10.1 % Total Families 11193 - 1,148 - Median familyincome $57/656 - $65,000 - Mean family income $881484 - $91,939 - Per capita income $31,295 - $32,892 - HEALTH INSURANCE COVERAGE Civilian noninstitutionalized population 41211 - 4,293 - With health insurance coverage 31226 76.6% 3,515 81.9% Without health insurance coverage 985 23.4% 778 18.1 % BELOW FEDERAL POVERTY LEVEL All families - 3.5% - 3.3% Families with female householder, no husband present ME - ME - All people - 5.0% - 3.4% EDUCATIONAL ATTAINMENT Population 25 years and over 21615 - 2,722 - Less than 9th grade - 2.8% - 3.0% 9th to 12th grade, no diploma - 4.7% - 4.4% High school graduate (includes equivalency) - 30.8% - 25.0% Some college, no degree - 29.6% ME - Associate's degree - 8.0% - 8.2% Bachelor's degree - 13.8% - 14.0% Graduate or professional degree - 10.3% - 11.9% ME - Margin of error exceeds 6%, not reported 1 ADOLWD 2 PFDs reported by zip code, ADOR 3 # Students enrolled in schools within city boundary, ADEED h, Sales Tax Rate Revenue Mill Rate Property Revenue Tax Oil and Gas Revenue Total Figure 94 - City of Soldotna Tax Revenue 3% 3% 3% 3% $7,641,757 0% -$83,714 $5,694,134 $7,717,581 $7,725,471 11.6 9.1 7.66 7.66 $0 $523,714 $803,576 $268,057 $279,920 $11,863 $0 $0 $0 $0 $0 $523,714 $803,576 E$268,057 F $279,920 IF $11,863 Source: DCCED Alaska Taxable Data Base KPEDD 2016 Situations & Prospects — Page 93 Figure 95 - Gross Sales for City of Soldotna (in $1000s) Admin, Waste Mgmt Ag, Forestry, Fishing, Hunting Arts & Entertainment Construction Contracting Educational Svs Finance & Insurance Guiding Land Guiding Water Health Care, Social Asst Hotel/Motel/B&B Information Mgmt of Companies Manufacturing Mining/Quarrying Prof, Scientific & Technical Svs Public Admin Rental Commercial Prop Rental Non -Residential Prop Rental Self -storage & Miniwarehouses Rental Personal Prol Rental Residential Prop $2, 824 $3,144 $3,656 $107 $84 $88 $1,570 $1,633 $4,046 $25,989 $39,160 $73,914 $721 $712 $716 $376 $385 $442 $908 $777 $605 $12,002 $10,657 $9,101 $41794 $4,811 $4,971 $10,526 $10,472 $10,090 $9,329 $15,010 $7,551 $79 $56 $3,125 $10,621 $10,531 $10,883 $1,394 $1,634 $1,612 $1,815 $2,000 $2,219 $4,678 $4,354 $6,712 $759 $849 $856 $9,331 $9,827 $11,112 Restaurant/Bar $23,378 $25,489 $25,678 Retail Trade $243,332 $255,400 $261,132 Services $8,998 $9,095 $9,760 Telecommunications $21436 $21705 $3,071 Timbering Transportation, Warehousing $13,801 $13,741 $31451 Utilities $22, 768 $14,142 $14,103 Wholesale Trade $18,202 $18,960 $311766 GRAND TOTAL $430,740 $455,627 $500,663 Annual % change 0.5% 5.8% 9.9% $3,530 $3,396 -$133 $95 $2,221 $1,969 -$255 $55,446 $72,454 $17,299 -$37 $842 $805 $493 $651 $157 $387 $386 -$7 $23,348 $23,659 $308 $5,207 $5,248 $41 $10,899 $10,097 -$947 $5,652 $5,229 -$423 $16 $30 $51 $10,877 $10,647 -$230 $1,640 $1,692 $52 $2,157 $81 -$185 $684 $5,181 $1,971 ' $5,944 $939 $54 -$327 $350 $10,875 $678 $26,954 $11,262 $789 -$10,911 $251,699 $27,710 $10,109 $2401903 $401 $3,791 $10,535 $928 ' $4,720 $4,116 $3,036 -$1,082 $15,612 $16,598 $986 $27,181 $22,349 -$4,919 $479,280 $482,125 $2,471 -4.3% 0.6% Source: Kenai Peninsula Borough Finance Dept 'confidential KPEDD 2016 Situations & Prospects - Page 94 Kenai Peninsula Borough Comprehensive Economic Development Strategy 2016 Kenai Peninsula Economic Development District Prepared for the US Economic Development Administration Pictures are from Community Photo Library, Division of Community and Regional Affairs Executive Summary This Comprehensive Economic Development Strategy (CEDS) for the Kenai Peninsula Borough is the result of a region -wide, public planning effort led by the Kenai Peninsula Economic Development District (KPEDD). It sets a vision for the economic growth of the region from 2016 to 2021, and serves as the action plan for KPEDD as the primary entity responsible for economic development initiatives for the Borough as a whole. The CEDS provides an overview of the economic, demographic, and employment trends of the region, places its unique geography in context, and reviews the strengths, weaknesses, opportunities, and threats. Using this background information collected from public datasets and extensive public outreach, the document then lays out the goals, objectives, and strategies for the five-year period, with an eye toward the resiliency of the region as it faces downturns in the oil and gas industry and declining state funds. The Kenai Peninsula Borough is in some respects a microcosm of Alaska as a whole. Its landmass hosts glacial rivers, mountain ranges, spruce forests, and coastal fjords —a sampling of the state's varied geography. The region's economy is likewise home to a large resource sector (fisheries, oil, and gas mostly) and a substantial visitor industry built around access to wilderness amenities. Peninsula communities range from rural and remote to urban and well-connected with highways and broadband internet. Statewide concerns like the potential liquefied natural gas (LNG) pipeline and 2014-15 decline in oil prices loom large in the Borough. However, the region is unique in several respects, including a rapidly aging population and relatively low public sector employment with no military bases and few state employees. In both its challenges and opportunities, the Kenai Peninsula Borough exhibits both strong resemblances and notable contrasts to Alaska as a whole. The CEDS attempts to capture these unique conditions and incorporate them into a comprehensive plan for future growth. The Kenai Peninsula Economic Development District "To attract, grow, and retain business and industry on the Kenai Peninsula that will enhance the vitality and quality of life in our communities."—KPEDD Mission Statement KPEDD is a 501©(4) non-profit regional economic development organization. Established in 1988, KPEDD serves the residents and communities of the Kenai Peninsula Borough in Southcentral Alaska. As the first federal Economic Development District designated in Alaska, as well as the first Alaska Regional Development Organization or ARDOR, KPEDD has actively pursued development opportunities for the region. Over its lifetime, KPEDD has been involved in a variety of projects including public works advocacy, shellfish industry development, international trade, promotion of a North Slope Natural Gas Pipeline to Cook Inlet, building infrastructure, industry recruitment, and business retention and expansion (BR&E). KPEDD, with funding provided by the Kenai Peninsula Borough, US Economic Development Administration, and State of Alaska, compiles and publishes the Kenai Peninsula Borough CEDS, and the this document represents the most recent update, replacing the previous 2011 document. Kenai Peninsula Comprehensive Economic Development Strategy Page 3 CEDS Strategy Committee The KPEDD staff and the University of Alaska Center conducted the CEDS process for Economic Development (UACED), under the general direction and guidance of the KPEDD Board of Directors. The Board also formed the core of the CEDS Strategy Committee, which convened bi-monthly from October 2015 until April 2016, along with a full -day strategy session on March 15, 2016. The Strategy Committee consisted of the following individuals: Current KPEDD Board Members: • Brendyn Shiflea (Board Chair) ConocoPhillips • Dale Butts, City of Seward • Stephanie Queen, City of Soldotna • Todd Smith, Kenai, Business Owner • Brandii Holmdahl, Kenai Peninsula Borough • Rick Koch, City of Kenai • Bryan Zak, Alaska Small Business Development Center • Stan Mishin, Kenaitze Indian Tribe • Rachel O'Brien, State of Alaska • Dale Bagley, Kenai Peninsula Borough Assembly • Julie Woodworth, Homer, Banking Former Board Members (engaged during process): • Tim Dillon, City of Seldovia • Mark Dixson, City of Soldotna • Katie Koester, City of Homer • Joe Rybeck, Soldotna, Private Industry • Mike Dye, Homer, Private Industry KPEDD Staff: • Tim Dillon, Executive Director • Rick Roeske, Former Executive Director • Caitlin Coreson, Programs Manager Process The Kenai Peninsula Borough CEDS was developed in accordance with the U.S. Economic Development Administration's guidelines, with KPEDD Executive Director Rick Roeske overseeing its completion. UACED conducted the background research, coordinate the public process, facilitated the creation of the action plan, and drafted the document itself. Wherever possible and practical, the Executive Director and Board members participated in community forums and industry focus groups, and provided extensive feedback and input on various drafts of the document. Kenai Peninsula Comprehensive Economic Development Strategy I ``1 Page 4 The relationship with the UACED began in June 2015, with work continuing into the fall and then the spring of 2016. Key milestones in the CEDS development include: • August 17, 2015—meeting between I<PEDD Executive Director and UACED team to discuss major economic trends to analyze for the CEDS. • January 27, 2016—Tourism industry focus group with Kenai Peninsula Tourism Marketing Committee • January 29, 2016—Business Forum to gather input at KPEDD's annual Industry Outlook Forum • February 3, 2016—Kenai and Soldotna Chambers of Commerce joint meeting, luncheon presentation and listening session. • February 5, 2016—Seward Chamber of Commerce luncheon presentation and listening session • February 20, 2016—Fisheries focus group held in conjunction with the annual meeting of the Cook Inlet Aquaculture Association • March 8, 2016—Homer Chamber of Commerce luncheon and listening session. • March 9, 2016—Seldovia Chamber of Commerce presentation and listening session. • March 15, 2016—CEDS Strategy Committee Meeting for the review of public input and formation of action plan/work plan. • May 16, 2016—CEDS draft approved by Strategy Committee, 30-day comment period initiated. • June 16, 2016—Comment period closed, document finalized for submission to EDA. Goals and Action Plan The Kenai Peninsula Borough is a collection of diverse and vibrant communities where citizens have year-round employment opportunities; businesses have access to a highly skilled, trained, and educated workforce; residents and visitors can enjoy the unique mix of urban and rural recreation activities; and responsible city and Borough management promotes economic growth and diversification. —Kenai Peninsula CEDS Vision Statement Through the participatory process described, the CEDS team identified six major goal areas summarized below. These goals attempted to holistically address the future economic needs of the Kenai Peninsula as a diversified, thriving region with adequate job opportunities and a uniquely Alaskan lifestyle. Each goal was matched with a series of actions, metrics, and partner organizations. These goals reflect the overall needs of the Borough as described by community forum participants, background research, and the SWOT analysis as the best way to maximize the assets of the region while mitigating potential areas of weakness. Kenai Peninsula Comprehensive Economic Development Strategy a Page 5 • Build ties to industry associations and communities •Coordinate region -wide economic development with communities • Industry focused infrastructure • Transportation infrastructure • Expanded broadband access • Industry partnerships and voc-tech • Workforce attraction and retention • Strengthen existing businesses through business retention and expansion • Promote responsible development • Develop entrepreneurial ecosystem • Develop Kenai Peninsula "brand" for residents, visitors, and businesses • Promote expansion of recreational ammenities and public access •Track and report economic and demographic trends • Seek new venues to publicize findings Figure 1: Goal and Action Plan Summary. Human Capital • Population in the Kenai Peninsula Borough, at about 58,000 in 2014, is projected to grow more slowly than the rest of the state, although LNG and other factors could result in significant population growth. • Unincorporated communities with highway access, and in close proximity to commercial centers like Soldotna or Kenai show the highest rates of growth. Established cities like Seward, Homer, and Soldotna have grown at a slow -to -moderate pace, and several South Peninsula communities are losing population. • The Borough shows low rates of in -migration. Most migrants moved to, or from, other parts of Alaska —predominantly Anchorage, the Matanuska-Susitna Valley, or the Fairbanks area. • The population of the Kenai Peninsula Borough is aging faster than the rest of the state, as the "economically active" share, those aged 20 to 64, is smaller than the statewide average. • Healthcare and social assistance is the largest employment sector, followed by retail trade, accommodation and food service, agriculture (fisheries), construction, and mining (oil and gas) according to US Census data. • Employment in the region is spread widely across these sectors, giving the Borough a higher degree of diversification than almost any other part of the state. Kenai Peninsula Comprehensive Economic Development Strategy J Page 6 • Despite having a relatively strong, diverse economy, unemployment rates are usually higher than the state average. For instance, in March 2016 the Borough's unemployment rate of 9.7% exceeded the state rate of 7.3% by almost two percentage points.' Geography • The land mass of the Kenai Peninsula Borough is roughly the size of Massachusetts and New Jersey combined. However, the Borough has only 3.7 residents per square mile. Waterways make up 8,741 square miles of the Borough. • 99% of the population resides on the Peninsula itself, with the western part of the Borough being sparsely populated. • The Kenai Peninsula Borough has many diverse climates. This can be seen by the numerous National Forest/Parks within or adjacent to the Kenai Peninsula Borough. Community Development and Quality of Life • In terms of cost of living, the Kenai Peninsula Borough has some of the least expensive housing costs in the state. The average Peninsula home sells for $115,000 less than an average Anchorage home, and about $10,000 less than an average Mat -Su home. • Consumer goods ranging from groceries to gasoline are more expensive than either Anchorage or the Mat -Su, but residents often save enough on housing to achieve a lower overall cost of living. • Low taxes and cost of living are the likely factors attracting retirees and seniors to the Borough from other parts of the state. Infrastructure and Transportation • Infrastructure in the Borough ranges from communities with highway access to those only accessible by air and water. Highway communities support the highest rates of population growth. • The only communities currently on the Alaska Marine Highway System are Homer and Seldovia. Ferry service is a critical link for these cities. • Average energy costs are low by state standards, but wide variation exists between communities with natural gas and those without. Industry Analysis • Using a location quotient (LQ) analysis, which measures employment concentration, economic sectors in the Borough were analyzed for their size and growth. Industries were then categorized as "Stars," "Mature," "Watch -list", "Challenged," or "Opportunity" industries. • Star industries (high concentration, positive growth) include: healthcare and social assistance, real estate, government, and retail trade. • Mature industries (high concentration, negative growth) include: accommodation and food services (tourism), agriculture (fishing), mining (oil and gas). These are the historic drivers of employment growth, although in some cases may face significant challenges, such as oil and gas. ' Source: Alaska Department of Labor and Workforce Development, Research and Analysis Section Kenai Peninsula Comprehensive Economic Development Strategy a Page 7 • Watch -list industries (high concentration, negative growth) include: manufacturing, and construction. • Challenged industries (low concentration, negative growth) include: wholesale trade, and administrative services. • Opportunity industries (low concentrations, positive growth) include: information, professional services, educational services, and financial services. • Economic and demographic resiliency is analyzed in this document as well. The Kenai Peninsula Borough is highly diversified by Alaska standards, but still exposed to volatile national or international markets such as oil and gas, and fisheries. LNG presents enormous opportunities for future growth, but significant workforce gaps must be filled to take advantage of them. • In terms of demographics, the Borough is facing low in -migration and an aging population. The region also has strengths to combat this, such as a low crime rate, and affordable energy and housing. "Placemaking" strategies to attract young families to these assets could be one approach. Kenai Peninsula Comprehensive Economic Development Strategy Page 8 Table of Contents ExecutiveSummary............................................................................................................................3 The Kenai Peninsula Economic Development District.............................................................................. 3 CEDSStrategy Committee.........................................................................................................................4 Process...................................................................................................................................................... 4 Goalsand Action Plan............................................................................................................................... 5 HumanCapital...........................................................................................................................................6 Geography................................................................................................................................................. 7 Community Development and Quality of Life.......................................................................................... 7 Infrastructure and Transportation............................................................................................................ 7 IndustryAnalysis....................................................................................................................................... 7 I. Human Capital..............................................................................................................................13 Demographics.................................................................................................................. ..............13 GeneralTrends....................................................................................................................................13 Raceand Ethnicity...............................................................................................................................14 Employment............................................................................................................................................15 Education................................................................................................................................................17 II. Geography...................................................................................................................................19 LandArea................................................................................................................................................19 Location...................................................................................................................................................19 Naturalenvironment..............................................................................................................................21 Climate.................................................................................................................................................... 22 III. Community Development and Quality of Life...............................................................................22 Costof living ............................................................................................................................................ 22 Income....................................................................................................................................................24 HousingAvailability................................................................................................................................. 25 IV. Infrastructure and Transportation Development: ......................................................................... 27 Transportation........................................................................................................................................ 27 Roads................................................................................................................................................... 27 AirAccess............................................................................................................................................ 29 Railroad............................................................................................................................................... 30 Kenai Peninsula Comprehensive Economic Development Strategy Page 9 Alaska Marine Highway System.......................................................................................................... 30 Energy..................................................................................................................................................... 30 Communications..................................................................................................................................... 33 V. Business Development: Industry Sector Analysis...........................................................................33 Utilizing Location Quotient Analysis....................................................................................................... 33 Star Industries — Local Economic Drivers...........................................................................................37 Healthcare and Social Assistance............................................................................................................37 Real Estate and Retail Trade: .................................................................................................................. 38 GovernmentSector................................................................................................................................. 39 Matureindustries............................................................................................................................40 Tourism...................................................................................................................................................40 Agriculture, forestry, fishing and hunting...............................................................................................41 Mining, Oil and Gas.................................................................................................................................44 Watch -list industries........................................................................................................................46 Construction............................................................................................................................................ 46 Manufacturing........................................................................................................................................47 ChallengedIndustries.......................................................................................................................48 Wholesale trade and Administrative and support services....................................................................48 Opportunityindustries.....................................................................................................................49 ResilienceComponent.....................................................................................................................51 Challenges to economic resiliency..........................................................................................................51 Challenges to demographic resiliency.................................................................................................... 52 PublicEngagement..........................................................................................................................53 Economic state of Kenai Peninsula Borough.......................................................................................... 53 Availability, training, and education of workforce..................................................................................54 Fisheries.................................................................................................................................................. 54 VI. SWOT Analysis............................................................................................................................56 Vill. Goals and Action Plan...............................................................................................................57 VisionStatement.....................................................................................................................................57 Kenai Peninsula Comprehensive Economic Development Strategy a Page 10 List of Figures Figure 1: Goal and Action Plan Summary...................................................................................................... 6 Figure 2: Kenai Peninsula Borough Communities by Population................................................................14 Figure 3: Total employment by industry, 2013...........................................................................................15 Figure 4: Employment in KPB and Alaska, 2003-2013................................................................................16 Figure 5: Not seasonally adjusted unemployment rates, 2005-2015.........................................................17 Figure 6: AVTEC and Kenai Peninsula College enrolled students, 2007-2014............................................18 Figure 7: Alaska Boroughs, Kenai Peninsula Borough in red......................................................................19 Figure 8: Map of Kenai Peninsula Borough................................................................................................ 20 Figure 9: Air miles between Anchorage and Borough communities.......................................................... 21 Figure 10: Average cost of living in: Anchorage, City of Kenai, and US ...................................................... 24 Figure 11: Single-family home price vs. Number of houses built, 2004-2015 (projection) ........................ 26 Figure 12: Kenai Peninsula Borough Road Service Area Boundaries..........................................................28 Figure 13: Average annual home energy costs vs. Energy consumption................................................... 31 Figure 14: Power Provider in KPB............................................................................................................... 32 Figure 15: Location Quotient in 2013 vs. Location Quotient Growth Rate ................................................ 36 Figure 16: Location Quotient in 2013 vs. Location Quotient Growth Rate from 2012 to 2013 in health care and social assistance........................................................................................................................... 37 Figure 17: Location Quotient in 2013 vs. Location Quotient Growth Rate from 2012 to 2013 in Real Estateand Retail Trade............................................................................................................................... 38 Figure 18: Kenai Government Employment for the First quarter of 2015................................................. 39 Figure 19: Tourism Employment in the KPB and Real GDP, 2002-2013.....................................................40 Figure 20: Location Quotient in 2013 vs. Location Quotient Growth Rate from 2012 to 2013 in Tourism4l Figure 21: Gross Earnings vs. Gross Pounds Landed, 2014.........................................................................42 Figure 22: Agriculture, Forestry, Fishing and Hunting Workforce & Total fish harvested in Kenai, 2002- 2013............................................................................................................................................................ 42 Figure 23: Location Quotient in 2013 vs. Location Quotient Growth Rate from 2012 to 2013 in Agriculture, forestry, fishing and hunting...................................................................................................44 Figure 24: Location Quotient in 2013 vs. Location Quotient Growth Rate from 2012 to 2013 in mining, oil andgas........................................................................................................................................................ 45 Figure 25: Location Quotient in 2013 vs. Location Quotient Growth Rate from 2012 to 2013 in Construction................................................................................................................................................ 47 Figure 26: Location Quotient in 2013 vs. Location Quotient Growth Rate from 2012 to 2013 in Manufacturing............................................................................................................................................48 Figure 27: Location Quotient in 2013 vs. Location Quotient Growth Rate from 2012 to 2013 in Challenge Industries....................................................................................................................................................49 Figure 28: Location Quotient in 2013 vs. Location Quotient Growth Rate from 2012 to 2013 in OpportunityIndustries................................................................................................................................50 Figure 29: Public Participation Summary....................................................................................................53 Figure 30: Workforce Availability................................................................................................................54 Figure 31: types of marketing desired by fisheries groups......................................................................... 55 Kenai Peninsula Comprehensive Economic Development Strategy Page 11 List of Tables Table 1: Housing expense comparison....................................................................................................... 23 Table 2: Average housing sae price for Kenai and Anchorage ...................................................................25 Table 3: Housing cost burden, rate of overcrowding, and energy rating ................................................... 27 Table 4: Public and Private Airports in KPB................................................................................................. 29 Table 5: Energy cost comparison for: Anchorage,. KPB, and Mat -Su .......................................................... 31 Table6: TV and Internet Rates.................................................................................................................... 33 Table 7: Summary of industry analysis....................................................................................................... 34 Table 8: Local government employment.................................................................................................... 39 Table 9: Location and number of logging products and operations...........................................................43 Kenai Peninsula Comprehensive Economic Development Strategy Page 12 I. Human Capital Demographics General Trends Based on U.S. Census data from July 2014, 57,212 people live on the Kenai Peninsula. From 2010 to 2014, population on the Peninsula increased 3.3%. By the year 2042, the population is projected to grow by roughly 15%. This growth translates into a projected 65,647 residents, which would suggest an average annual growth of 0.4%. After the year 2022, population growth is expected to slow for both Alaska and the Kenai, but Peninsula growth rates will decline more sharply than the state overall as the state should grow at an annual rate of 0.9% through 2042. At the community level, growth rates vary considerably. The bedroom communities of the Central Peninsula, a highway accessible area that spans from Sterling to Kasilof, showed robust growth rates between 2010 and 2014. This includes Ridgeway, Kalifornsky, and Salamatof, all located a short drive from the commercial centers of Soldotna and Kenai. These latter two communities, taken together with other established cities like Seward, Homer, and Nikiski, showed modest growth —likely a consequence of limited buildable land within their municipal boundaries. The small coastal communities of the South Peninsula such as Ninilchik, Kachemak City, and Seldovia were more likely to see a shrinking population. Anchor Point and Diamond Ridge, however, showed significant growth. Highway access, buildable land, and proximity to an existing population center seem to be the biggest predictors of growth. See Appendix 1 for more information on the communities' population changes. In any region, there are two main components of population change: natural increase and net migration. Natural increase is based on birth and death rates, while net migration reflects movement to and from the region. For example, from 2013 to 2014 the population on the Kenai Peninsula Borough increased by 399 residents. Of this, 325 (81%) were due to natural increase, and 74 (19%) to net migration. Population projections provided by the Alaska Department of Labor and Workforce Development suggest that in the coming decades this dynamic will change (see Appendix 2): by 2032, 57% of population growth will be due to natural increase and the rest to net migration. By 2042 64% of population growth will come from net migration. This trend is connected to another challenge the region faces, an aging population. Over time the Borough's workforce will increasingly rely on individuals relocating to the region rather than births, putting additional pressure on a small labor market. Kenai Peninsula Comprehensive Economic Development Strategy Page 13 Salamatof 1,120 L 14.3% Homer 5,099 1.9% Nanwalek Ridgeway 275� 2,187 8.3% 8.2% Tyonek Diamond Ridge 174 11174 1.8% 1.6% Kalifornsky 81F441 7.5% Bear Creek 11985 1.5% Anchor Point 2,059 6.7% Kenai (city) 7,167 0.8% Fritz Creek 2,024 4.8% Funny River 877 0.0% Kasilof 574 4.6% Kachemak 460 -2.5% Sterling 51869 4.5% Ninilchik 847 -4.1% _ Clam Gulch 183 4.0% Happy Valley 566 -4.6% Soldotna (city) 41311 3.6% Port Graham 168 -5.1% Nikiski 4,652 3.5% Fox River 644 -6.0% Seward city 2,768 2.8% Seldovia (city) Halibut Cove 233 65 -8.6% -14.5% Cohoe 1,394 2.2% Hope 196 2.1% Nikolaevsk 270 -15.1% Cooper 295 2.1% Landing Figure 2: Kenai Peninsula Borough Communities by Population Source: US Census Bureau American Community Survey, 2010-2014 With slowing population growth and an increasing share of net migration as the main driver of growth, age distribution becomes a vital indicator. Based on U.S. Census data from 2014, the region's economically active population, which includes individuals between 20 and 64 years old, accounts for about 60% of total population (see Appendix 3). Statewide, the share of the economically active population is similar at around 62%. Population projections for 2042, show a decrease in the economically active population from 34540 in 2014 to 33,989 or 52% of the total residents, compared to 56% statewide. Alarmingly, the Borough's working -age population is expected to shrink, even as the total number of residents will increase slightly. Race and Ethnicity The Kenai Peninsula Borough is less ethnically diverse than the state as a whole, but the non -white share of the population is growing. According to U.S. Census Data, a large majority of Peninsula residents are white (85% in 2014, compared to about 66.9% statewide 2), although the growth rate for this group is the lowest among ethnic groups, 3.2% over the period from 2010 to 2014 (see Appendix 5). At about 12%, "American Indian and Alaska Native" is the second largest group in the region, and this share of the population grew by 5% during these years. The highest growth rate over the same period was by the "Black or African American" group at 39.1%, reaching a population of 762 in 2014. Asian and Native 2 Race and Hispanic Origin, 2010-2014. Retrieved from http://Iaborstats.alaska.gov/pop/estimates/data/RaceHispAK.xls. Retrieved on 10.03.2015. Kenai Peninsula Comprehensive Economic Development Strategy Page 14 Hawaiians are the smallest ethnicity groups on the Kenai, but taking into account average growth rates, these groups should increase in the next five years. Employment In analyzing employment on the Kenai Peninsula it is useful to look at the most established industries in the region, including fisheries (part of agriculture, forestry, fishing and hunting U.S. Census category), oil and gas (classified as mining), health care and social assistance, retail trade, and accommodation and food services (see Figure 3).3 Total Employment by Industry, 2013 Unclassified Management of companies and enterprises Educational services Wholesale trade Utilities Information Finance and insurance Administrative and waste services Arts, entertainment, and recreation Real estate and rental and leasing Professional and technical services Manufacturing Transportation and warehousing Other services, except public administration Mining, quarrying, and oil and gas extraction Construction Agriculture, forestry, fishing and hunting Accommodation and food services Retail trade Health care and social assistance 3,491 0 500 11,000 1,500 21000 21,500 3,000 31500 41,000 Figure 3: Total employment by industry, 2013 Source: US Census Nonemployer Statistics data, Quarterly Census Employment and Wages Measured by employment, the Kenai Peninsula Borough economy is more diversified than the state overall. Oil and gas, and government are the key statewide sectors. In Kenai, mining (including oil and gas) employment is at the same level as construction (7.1% and 7.4% respectively), and agriculture (including fishing, see Appendix 7) takes a slightly higher share, 8.1%. At the same time the healthcare and tourism sectors have the largest share of total employment (accommodation and food services —11%, retail trade 3 When evaluating employment in the region two main databases are key: 1. Quarterly Census Employment and Wages (QCEW); 2. US Census Nonemployer Statistics data, which contains information on earnings and counts self-employed individuals and sole proprietors. As Kenai Peninsula contains a significant number of self-employed commercial fishermen, the second source of information plays an important role. See Appendix 6 for a more detailed breakdown. Kenai Peninsula Comprehensive Economic Development Strategy a Page 15 — 13.5%, and health care and social assistance —16%). That means there are at least six reasonably large sectors driving employment in the Kenai Peninsula Borough, insulating it from shocks in any one employment category. Alaska Employment in Kenai Peninsula Borough and Alaska, 2003-2013 Borough 3101000 221500 22,000 300,000 21,500 290,000 21,000 20,500 2801000 20,000 270,000 19,500 19,000 2601000 18,500 2501000 18,000 Total Employment Alaska Total Employment KPB 17,500 240,000 17,000 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Figure 4: Employment in KPB and Alaska, 2003-2013 Source: US Census Nonemployer Statistics data, Quarterly Census Employment and Wages From 2003 to 2013 there were two dips in Kenai Peninsula Borough employment: 2006, and 2008-2009. Some explaining factors are: poor fish harvests, tourism, changes in construction, and oil and gas. Poor fish harvests led to low fishery employment in 2006 and 2008. Tourism played an important role in the 2008 decline as the visitor industry in Alaska generally follows trends in the national economy closely, which was in decline in 2008 (see Appendix 10). The construction industry is another sector with substantial influence on Borough employment trends. There were two significant declines in construction employment since 2003: 2006, and a more prolonged decline that started in 2008 and lasted until 2012 (see Appendix 9). The oil and gas industry is also an economic driver in the Kenai Peninsula Borough. Oil production was decreasing until 2009, and it caused a continuous decrease in sector employment from 2008 to 2011. It recovered in the following two years, reaching a high in 2013 (1,540 employees) when Alaska North Slope West Coast Average Oil Spot Price was at a high point $107.60 per barrel (please see Appendix 12).4 For the last 10 years, the unemployment rate in Kenai Peninsula Borough was on average higher than at the state level: 8.6% vs. 7% (see Figure 5). Borough unemployment follows state trends: from 2007 to 4 AOGA Fact Sheet: Cook Inlet Oil and Gas Production. Retrieved from http://www.aoga.org/sites/default/files/news/cook inlet fact sheet final.pdf. Retrieved on 10.01.2015. Kenai Peninsula Comprehensive Economic Development Strategy I 11' Page 16 2010 there was a constant increase from 7.6% to 10%. Beginning in 2010 unemployment began declining, and in the last three years it leveled out at 8%. Not seasonally adjusted unemployment rates, 2005-2015 10.5 10.0 9.5 9.0 8.5 8.0 7.5 7.0 6.5 6.0 Alaska, 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Figure 5: Not seasonally adjusted unemployment rates, 2005-2015 Source: Alaska Department of Labor and Workforce Development Education Education is one of the most important areas for identifying economic development in the Kenai Peninsula and Alaska overall, as future availability of specialists and a qualified labor pool depends on high graduation rates and educational attainment. Available statistics divide the school -age population into three age groups: 5-9, 10-14, and 15-19 years old. Based on population estimates from July 2014, these groups combined make up about 19% of the Kenai Peninsula Borough's population. Statewide, the same groups account for almost 21% of the population, with almost equal distribution between groups. It is projected that through 2042 the share of students will remain essentially flat at both the Borough and state level. At the state level this group will grow faster than at the Borough level with the state growth rate becoming 27.3%, and the Borough growth rate becoming 18.7%. Over the last 10 years, enrollment in the Kenai Peninsula School District has continuously declined from the 2003-2004 school year, when there were 9,645 students, to 9,077 students in 2013-2014. This trend is associated primarily with the decreasing population of school -age children. It is significant that enrollment is decreasing slower than school -age population: in the last decade enrollment in public schools decreased 5.9%, while population in the age group decreased 12.2%. This indicates that a greater share of the school age population is enrolling — an observation validated by increasing graduation numbers, and falling dropout rates (see Appendix 13). Based on information provided by Kenai Peninsula Borough School District, this trend was facilitated by a number of other changes, programs, and initiatives over the past few years. The School District works with "at -risk" students at Nikiski Middle -High, Soldotna High, and Seward High schools. Another program that helps students succeed is personalization of the education experience with distance courses. They provide opportunities for students that meet their individual needs and interests at a time, place, and Kenai Peninsula y Comprehensive Economic Development Strategy a Page 17 pace that works for them. Moreover, state investment in career and technical education programing has expanded with the passage of Senate Bill 84 in 2010, which may have a positive impact on graduation rates. Beyond the K-12 system, the Kenai Peninsula College and Alaska Vocational Technical Center (AVTEC) are located in the Kenai Peninsula Borough. The former is a community campus system within the University of Alaska Anchorage, with four locations — Soldotna, Homer, Seward and Anchorage (via distance delivery).' AVTEC is located in Seward and provides training in a variety of industrial and technical fields, ranging from welding to nursing.6 Other training organizations include the Homer Marine Trades Association. 5,000 4,000 3 000 AVTEC and Kenai Peninsula College enrolled students, 2007-2014 �,009� 2,744 1,12 2007 2008 2009 2010 2011 2012 2013 2014 © AVTEC Students ■ KPC Students, all campuses Figure 6: AVTEC and Kenai Peninsula College enrolled students, 2007-2014 Source: University of Alaska Anchorage Institutional Research Enrollment Reports; http://www.uaa.alaska.edu/ir/reports/Enrollment/index.cfm The year 2011 was characterized by the largest number of students enrolled in AVTEC and Kenai Peninsula College in the last seven years (see Figure 6). Since 2011, enrollment numbers in both institutions fell slightly, though there was an uptick between 2013 and 2014. In comparison with the previous year the increase was about 12.7%, but after 2011 the number of enrolled students declined until 2014. The GRAD program donation in 2011 was primarily focused on the College Access Program; which provides structural, motivational, and experiential support targeting college and career awareness, academic rigor, college readiness, and affordability so that students successfully complete postsecondary education.' The GRAD program may have been one motivator behind the increase in college enrollment.' s About Kenai Peninsula College. Retrieved from http://www.kpc.alaska.edu/about/. Retrieved on 10.08.2014. 6 AVTEC. Retrieved from http://www2.Borough.kenai.ak.us/Econ/1S P%20data/Demographics/AvTech.htm. Retrieved on 10.08.2015. ' Walmart Donates $25,000 to Project GRAD Kenai Peninsula. Retrieved from http://www.akbizmag.com/Alaska-Business- Monthly/October-2011/Walmart-Donates-25000-to-Project-GRAD-Kenai-Peninsula/. Retrieved on 08.10.2015. 8 GRAD Program Kenai Peninsula Borough. Retrieved from http://alaska.project rg ad.org/pro r ams/. Retrieved on 12.11.2015. Kenai Peninsula Comprehensive Economic Development Strategy J Page 18 II. Geography Land Area The Kenai Peninsula Borough is 25,600 square miles, of which 15,700 square miles are land', and 8,741 square miles are water10. The population per square mile is 3.7. The Borough is roughly the size of New Jersey and Massachusetts combined. Figure 7: Alaska Boroughs, Kenai Peninsula Borough in red Location The Borough is surrounded by Anchorage to the north, the Alaska Range to the west, the Gulf of Alaska and Prince William Sound to the south and east. The Kenai Mountains run to the north and south of the Borough. The Cook Inlet runs in the center of the Borough, creating two land masses. Although, approximately 99% of the population resides in the Peninsula, with the west side of the Borough being sparsely populated. 9Source: Kenai Peninsula Borough, Our Geography: http://www.kpb.us/our-geography 10 Source: NOAA, South Central Alaska, Kenai Peninsula Kenai Peninsula Comprehensive Economic Development Strategy I 11' Page 19 City C."fl) P HI g hvia y Road Borough/GA N Map Prepkjre.d lyy Alas Ka Department of Labo-r WorkTorce Deve!lopmervt ��prem her 20 11 ;SOWC� US C121k�L-n 2010 TIGERline Kenai Peninsula Borough BOW Census kee Laka and Pan inside Borough Matanuska-susitn'ci Borougli Thorage2lunici ali Hope Sun Ps Valdez- Pairil Posses!Mcn Cordova idv-way Ctl 0 Pe r pCens U-S Lary Arim SalarnaV Sterling I Moo5e Pam Cf own Porn, k Ka1ff-.qmsq - Funny River comoe suldalln'l Onn-irose Bear CreeK Cram Gulert 4? wa rd, Kenai Peninsula Borough N1n1 Ich k F41 Lowell Point [lap py Valle%- N kolaeVA OX Rwr 1 A P%ncr,or Po-int FrjtZ-CFF-Lek Diamond, Rid e Eliomer 7 laik ut c'cve 9 A-mL Seldom Valage N anwam Pori Grah-am KOd-liak Ishirld I C. 15 30 GG M141 Figure 8: Map of Kenai Peninsula Borough Source: Alaska Housing Finance Corporation Kenai Peninsula Comprehensive Economic Development Strategy Page 20 41P The Borough's 37 communities are connected by land, air, and ferry. The Kenai Peninsula Borough has 29 airports or landing strips (discussed further in infrastructure and transportation). The air miles from major public Kenai Peninsula Borough airports to Anchorage, the closest hub city, are as follows: Kenai Soldoin Homer • 60 miles SW • 55 miles SW • 119 miles SW • 75 miles SE Seldovia 134 miles SW Figure 9: Air miles between Anchorage and Borough communities Natural environment The Borough consists of diverse climates including: glacial rivers, mountain ranges, spruce forests, and coastal fjords. Much of this diverse climate is part of national forests/parks within or adjacent to the Kenai Peninsula Borough including: • Chugach National Forest • Katmai National Park and Preserve • Kenai Fjords National Park • Kenai National Wildlife Refuge • Lake Clark National Park and Preserve • Kachemak Bay State Park The Kenai Peninsula is an active zone for earthquakes, the Pacific Plate found in the Gulf of Alaska is still quite active. The January 24t", 2016 earthquake was centered in the Cook Inlet region, it was 7.1 magnitude. There are also volcanoes in the Cook Inlet area. There are a plethora of waterways in the Borough, which support the extensive aquaculture economies. Two important water habitats are the Chickaloon River Flats, which is a major saltwater estuary, and the Kenai National Wildlife Refuge. The refuge is drained by numerous waterways including: • Kenai River • Anchor River • Six Mile Creek • Fox River • Snow River • Chuitna River • Trail Creek • Palmer Creek Kenai Peninsula Comprehensive Economic Development Strategy a Page 21 • Chakachatna River • Rocky River." In 2013 an Anadromous Streams Ordinance was passed to prohibit development within 50 feet of waterways that are salmon -bearing. The vegetated buffer zones help filter out a variety of contaminants from reaching the waterway. The contaminants are produced by a variety of sources including storm water runoff. Climate Winter The Borough has relatively mild winters with the average temperature ranging from 4° to -380 F. Winter is short by Alaskan standards lasting from December to February. The winter season has far less sunlight, the shortest day of the year, December 20, has only 5 hours and 43 minutes of sunlight. The average snowfall varies greatly based on location. The greatest average snowfall is in Hope (89.5 inches), and the smallest average snowfall is in Nikiski (33 inches), many other communities in the Borough have average snowfalls more similar to Hope. Spring Spring is short, lasting from March until May. This is when the snow begins to melt, and the temperature and amount of daylight are increasing. This is the time of year people use for harvesting, particularly of perennial plants such as: fiddleheads, young marsh marigolds, and Devil's club. Fall Beginning in September, as many of the tourists and sport fisherman have left, the level of precipitation increases (when compared to the spring months). Many seasonal businesses close up for the winter. The temperature begins to drop from an average high of 57' in September to an average high of 310 in November. Summer The summers are mild, with temperatures ranging from 46-700 F. Summer lasts from June through August, and is prime fishing season. The average precipitation ranges from a high of 66 inches in Seward, to a low of 18 inches in Nikiski. Summer brings much more sunlight, the longest day of the year, June 215t, has 17 hours and 4 minutes of daylight. III. Community Development and Quality of Life Cost of living A strong indicator for cost -of -living is the consumer price index (CPI), which in Alaska is calculated only for Anchorage. Average prices around the state vary considerably depending on community, so while CPI indicates a general rate of inflation, it provides limited insight into local prices outside of Anchorage. In 2014 prices increased 1.6%, and in the first half of 2015, only 1.1% (see Appendix 14). 11 Source: U.S. Fish & Wildlife Service Kenai Peninsula Comprehensive Economic Development Strategy �' 1 J Page 22 According to the July 2015 Trends publication from the Alaska Department of Labor, Borough prices are higher than those of Anchorage in the categories of groceries, supplies for housing construction (both local and delivered from Lower 48 states), and fuel prices. Only housing is cheaper in the Borough than in Anchorage (see Table 1), which may be additional incentive for migration to the region, both for permanent relocation and for seasonal jobs, as both rent and home prices are lower than in Anchorage.12 However, because housing is such a large share of a typical family's expenses, it frequently offsets higher prices in other categories for some Borough communities. Table 1: Housing expense comparison kmmmmfimp Weekly Grocery Cost, Family of Four, $ 1 Two Bedroom Apartment Rent per Month, $ 923 11331 969 2014 0.69 The Cost of Buying from Local Suppliers, Home construction, $ 291,018 23,405 27,604 2015 1.24 The Cost of Buying from Seattle, Home construction, $ 35,124 33,433 341047 2015 1.05 Average Housing Price, $ 246,948 3601965 2561295 2014 0.68 Gasoline Price per Gallon, $ 4.13 3.90 3.97 2013 1.06 Diesel #1 Price per Gallon, $ 3.88 3.71 3.94 2014 1.05 Another way to look at cost -of -living is the cost -of -living index (COL), which differs from CPI by the fact that the former takes into account changes in purchasing patterns in the region, and therefore provides a better picture. Moreover, COL data is available for the Kenai Peninsula Borough (see Figure 10). This index compares the region with the national average based on several factors: groceries, health care, housing, utilities, transportation, and miscellaneous. " Cost of Living. Retrieved from http://Iaborstats.alaska.gov/col/col.pdf. Retrieved on 10.26.2015. Alaska Energy Data Gateway. Retrieved from https://akenergvgateway.alaska.edu/community-data-summary/1411788/. Retrieved on 10.26.2015 Kenai Peninsula Comprehensive Economic Development Strategy a Page 23 Average Cost of Living in: Anchorage, City of Kenai, and US ■ United States ■ Kenai (city) Anchorage 200 180 160 140 120 100 80 60 40 20 0 Overall Grocery Health Housing Utilities Transportation Miscellaneous Figure 10: Average cost of living in: Anchorage, City of Kenai, and US Source: http://www.bestplaces.net/cost of living/city/alaska/kenai The Borough has high utility and grocery costs in comparison with the national and Anchorage averages. Health expenses are similar to Anchorage, and housing is significantly less expensive, which underscores the previous conclusion. As with the Mat -Su Borough, affordable housing provides a source of competitive advantage for the Borough and may be used as an inducement for young families to relocate. Income Income levels in the region provide another indication of quality of life when taken together with price levels. Per capita income trends in the region show that over the last 10 years there was only one year of decline: 20091 the year after the national economic and financial crises unfolded. The same year ANS oil price declined almost 38%, which may have also contributed to falling incomes on the Peninsula (see Appendix 12). Per capita income in Alaska, and particularly in Anchorage, has also increased over the last 10 years, but the Borough growth rate was notably higher. Statewide incomes grew 3.8% on average, and 3.3% in Anchorage. In the Borough the annual rate was 4.9% (see Appendix 15). While Anchorage historically has higher incomes, the gap has shrunk considerably (in 2013 it was only $1,665 per year). Taking into account the overall picture (see Figure 10), cost -of -living in Anchorage is 7.3% higher than in the Kenai Peninsula Borough, but income per capita in 2013 was 13% higher (per capita income in Anchorage - $54,766 per year, in the Borough — $48,485 per year.) The region has the 12th highest income per capita in Alaska. Total personal income in Kenai Peninsula Borough in 2013 was $2.6 billion. Appendix 16 represents total personal income by industry. The highest income is in three industries: transportation and warehousing (about 18% of total income), local government (16% of total income), which is divided into school district Kenai Peninsula Comprehensive Economic Development Strategy a Page 24 4 employees' income (66%) and non -education employees' income (34%), and mining, quarrying, and oil and gas extraction (slightly more than 12% of total income). The share of employment in the mentioned industries is presented in the second graph in Appendix 16. This graph shows that, for example the transportation and warehousing sector has the highest share of employee personal income out of total personal income in the region, and also has the highest share of employment. The local government sector accounts for 16% of personal income, and 10.5% of total employment. The difference is even higher in mining, quarrying, and the oil and gas sector, 12.4% of income and 5.1% of jobs. Essentially each of these sectors produce jobs that pay well above average. The situation in retail trade and healthcare is opposite — these industries' employment have a much higher share than the total income, in other words, these industries have more employees who work for less income. Household income in the Kenai Peninsula Borough is lower than the statewide average but higher than at a national level (see Appendix 17). About 19.9% of households have average income ranging from $50,000 to $74,999 per year, 4.4% live on less than $10,000 per year, and about 3.7% on more than $200,000. Housing Availability As stated in the "Cost of Living" section, housing in the Kenai Peninsula Borough is more affordable than in Anchorage. Average sales price varies depending on the type of housing, but on average prices in Anchorage are 28% higher than on the Peninsula. According to Alaska Housing Finance Corporation, the average home loan amount in the Kenai Peninsula Borough in 2015 was $214,885. As the cost of building supplies for home construction on the Peninsula are higher than in Anchorage, housing prices may be lower because of other factors like cost of land and labor force. For example, average monthly wage in the Building Construction sector in the Borough is $4,280, while in Anchorage it is $6,679.13 Table 2: Average housing sale price for Kenai and Anchorage Single -Family 147 7.5% 226,205 260,510 361,983 86.8% Condominium 3 -40% 153,300 176,000 210,238 87.1% Multi -Family 2 -60% 265,150 467,500 582,596 56.7% Source: Alaska Housing Market Indicators, Q12015. Retrieved from https://www.ahfc.us/efficiency/research- information-center/alaska-housing-market-indicators/. Retrieved on 10.21.2015. The number of houses constructed varies by year and by community. On average 45.3% of the houses are built in Homer, 26.8% in Kenai and about 23% in Soldotna, among the communities reporting data to the Alaska Housing Finance Corporation Housing Market Indicators survey, which includes only a selection of Borough communities. There is a strong correlation between the number of houses built and the average price the same year (see Figure 11). Housing demand appears strong although building activity can vary from year to year. Most construction is funded by private developers rather than publicly -funded housing authorities, as in rural Alaska. 13 Preliminary Annual Employment and Wages. Retrieved from http://Iabor.alaska.gov/research/qcew/eel4.pdf. Retrieved on 10.21.2015. Kenai Peninsula Comprehensive Economic Development Strategy Page 25 Single-family here price vs. Number er of houses built 4- 15 (projection) 270P000 170 150 2501000 130 230?000 110 2101000 90 70 190P000 50 170?000 —Average Housing Price,m k Total Housing ing Built 0 2006 2007 2008 2000 2010 2011 201 2013 2014 2015 Figure 11: Single-family home price vs. Number of houses built, 2004-2015 (projection) Source: Alaska Housing Market Indicators. Retrieved from https://www.ahfc.us/efficiency/research-information-center/alaska- housing-market-indicators/. Retrieved on 10.21.2015. Note: 2015 — Houses built is based on regression analysis projection. In the last 10 years there were several spikes in home prices, including 2008, 2010, 2012 and 2015. On average housing cost inflation per year was about 3.5%, while average inflation on consumer goods during the same period was about 2.5%. This means the home prices in the Borough increased 1.4 times faster than general prices. As for affordability, on average about 29% of households in the Kenai Peninsula Borough spend more than 30% of total income on housing costs, including rent, utilities, and energy costs, meeting the definition of "cost burdened."14 in the Matanuska-Susitna Borough about 34% of households are cost -burdened, while at the state level the figure is 31%.15 Only a small percentage of homes are 1-star energy rated in the Peninsula region, the least efficient category of housing (see Table 3). Approximately 3% of housing units on the Kenai Peninsula are available for sale or rent with the lowest percentage being found in Clam Gulch (only 1%) and the highest, at 8%, in Seldovia.16 14 2014 Alaska Housing Assessment. Kenai -Peninsula Borough. Retrieved from https://www.ahfc.us/efficiency/research- information-center/housing-assessment/. Retrieved on 10.21.2015. 15 2014 Alaska Housing Assessment. Matanuska-Susitna Borough and statewide report. Retrieved from https://www.ahfc.us/efficiency/research-information-center/housing-assessment/. Retrieved on 10.26.2015. 16 2014 Alaska Housing Assessment. Retrieved from https://www.ahfc.us/efficiency/research-information-center/housing- assessment/. Retrieved on 10.21.2015. Kenai Peninsula Comprehensive Economic Development Strategy Page 26 Table 3: Housing cost burden, rate of overcrowding, and energy rating Seward Soldotna 33.4% 42.1% 6.4 % 1.2% Anchorage Municipality 35.0% 4.2% Matanuska-Susitna 34% 6% Borough Source: 2014 Alaska Housing Assessment. Retrieved from https://www.ahfc.us/efficiency/research-information- center/housing-assessment/. Retrieved on 10.21.2015. *Red — High **Black — Moderate ***Green —Low IV. Infrastructure and Transportation Development: Transportation Roads Unlike most of Alaska's landmass, large portions of the Borough are connected to the North American Highway System through Anchorage. The Seward and Sterling Highways are the primary arteries on the Kenai Peninsula and provide much of the region ground access to the rest of Alaska, Canada, and the Lower 48. The Kenai Spur Highway connects the large population centers of the Central Peninsula — Kenai, Nikiski, Ridgeway, and Salamatof —to the Sterling Highway. At opposite ends of the Peninsula, the Seward and Sterling Highways connect Seward to Homer and enable the development of numerous communities like Moose Pass, Cooper Landing, and Anchor Point, which lie between. The diversified economy of the region owes much to this relatively well -developed highway infrastructure, enabling the flow of people (including tourists), consumer goods, and construction materials at lower cost than regions dependent entirely on air transportation. A number of communities and villages in the Southern Peninsula do not connect to the road system, including Seldovia, Nanwalek, and Port Graham. These communities are accessible by boat or air. On the western side of the Borough, the village of Tyonek is also only accessible by boat or air. Disconnectedness from ground transportation creates challenges such as: difficulty receiving timely medical care, increased cost of living, and fewer employment opportunities than the rest of the Borough.17 The Kenai Peninsula Borough Road Service Area includes more than 630 miles of roads. The area is divided into five regions: Central, West, North, East, and South, and each region is divided into units. There are 28 units overall (see Figure 12).18 17 http://www.cityofseward.us/DocumentCenter/View/396 18 Road Service Area. Retrieved from http://www.kpb.us/rds-service-area/about-rds. Retrieved on 11.09.2015. Kenai Peninsula Comprehensive Economic Development Strategy Page 27 AM 7-Ke SO 4C KAOHEWAK SAT STATE PAURK LAIC-- Sig Legeiid Figurel2: Kenai Peninsula Borough Road Service Area Boundaries Source: Retrieved from ons.a.zo1a. Roads also connect commuters to places of employment. About 8.4% of workers commute to the Peninsula from other areas, both in Alaska (7.996) and from other states (0.5Y6), though it is not known what share commute via air transportation." About 12.5% of commuters work in Agriculture, forestry, fishing and hunting, and mining sector., 11.6%— in Retail trade and 22.896— in Educational services, and health care and social assistance .20 According to a U.S. Census Bureau report, most workers within the region drive a car to work — 79%. 19 Based onu�Census Bureau, 2010-2014 American Community Survey s-YearEstimates. 20Based onu�Census Bureau, 2010-2014 American Community Survey s-YearEstimates. Kenai Peninsula Comprehensive Economic Development Strategy Page2O Air Access There are both public and private airports in the Kenai Peninsula Borough, ranging from those that receive daily commercial service, such as Homer and Kenai to remote gravel airstrips.21 Public airports include major hubs and airfields used for large carriers, jet liners, and international flights, as well as smaller public charter flights and personal aircraft. Private airports may require special permission, a private membership, or use of private charter flights. Most airports are private as there is a need to access many small, remote communities. "Flightseeing" tours are very popular among tourists, especially in Homer, Soldotna, and Kenai. Table 4: Public and Private Airports in KPB irport ocationdi • • River Airpark Airport Anchor Point qwAnchor Private Hackney Landing Seaplane Base Clam Gulch Private Bear Cove Farm Airport Homer Private Bradley Lake Hydroelectric Project Airstrip Airport Homer Private Homer Airport Homer Public Kasilof Airport Kasilof Public Carty's Airstrip Airport Kenai Private Doyle Estates Airport Kenai Private Henley Airport Kenai Private Island Lake Seaplane Base Kenai Public Kenai Municipal Airport Kenai Public Drift River Airport Kenai Public McGahan Industrial Airpark Nikiski Private Offshore Systems -Kenai Heliport Nikiski Private Bangerter Field Airport Soldotna Private Soldotna Airport Soldotna Public Mackeys Lakes Seaplane Base Soldotna Public Alaska Airpark Airport Sterling Private Sterling Air Park Airport Sterling Private Dutch Landing Strip Airport Sterling Private Lakewood Airstrip Airport Sterling Private Scooters Landing Strip Airport Sterling Private Sterling Air Park Airport Sterling Private Seward Airport Seward Public Nanwalek Airport (was English Bay Airport) Nanwalek (English Bay) - Dog Fish Bay Airport Nanwalek Private Port Graham Airport Port Graham - Seldovia Airport Seldovia Public Seldovia Seaplane Base Seldovia Public Tyonek Airport Tyonek Private 21 Kenai Peninsula County Public and Private Airports. Retrieved from http://www.tolIfreeairline.com/alaska/kenaipeninsuIa.htm. Retrieved on 11.09.2015. Kenai Peninsula Comprehensive Economic Development Strategy Page 29 Source: http://www.tolIfreeairline.com/alaska/kenaipeninsuIa.htmI http://www.gutenberg.us/articles/List_of airports_in_the_Kenai_PeninsuIa_Borough. Kenai Municipal Airport is the largest of nine airports in the region and serves as the primary collection and distribution center for scheduled passenger, cargo, and mail service. Regular commuter flights out of Kenai Municipal link the Central Peninsula to Anchorage, 60 air miles away. Railroad The Alaska Railroad Corporation operates two trains between Seward and Anchorage. The Grandview Cruise Train is only available to cruise ship passengers beginning or ending a cruise in Seward. The Coastal Classic is open to the public and makes a daily round-trip from Anchorage to Seward with a stop in Girdwood. Seward is the only community in the Borough with rail access, and the train moves freight (including coal from the Interior for export) in addition to passengers. Alaska Marine Highway System The Alaska Marine Highway System serves Homer and Seldovia on the Kenai Peninsula. In 2006, Homer's ferry passengers increased, as AMHS ferry service to and from Seward was discontinued. The ferry currently goes to Homer and Seldovia as part of the Southcentral Alaska route. Not unlike traditional highway access, ferry service is a vital link between coastal communities and allows vehicles as well as passengers to access places like Seldovia, which are not on the road system. 22 Energy In 2014, the estimated average annual energy cost for houses in the Kenai Peninsula Borough was about $4,510, approximately 1.6 times more than the cost in Anchorage and 2.1 times the national average. About 18% of the occupied housing in the Kenai Peninsula Borough has completed either the Home Energy Rebate, Weatherization, or Building Energy Efficiency Standards (BEES) program since 2008, compared to 21% statewide. These programs subsidize residential upgrades to housing to increase efficienCy. 23 As for the cost burden, on average, approximately 29% of households in the Kenai Peninsula Borough spend more than 30% of total income on housing costs, which includes rent, utilities, and energy costs. Annual energy costs constitute approximately 8% of the Census median area income for occupied housing, Matanuska-Susitna Borough residents spend 5.2%.24 Based on the "2014 Alaska Housing Assessment," the highest annual energy cost is in Seldovia (about $7,303) and the lowest is in the City of Kenai ($3,000). It should be noted that natural gas distribution has continued to expand since these data were compiled, reducing costs by displacing more expensive heating oil. 22 Communities. Retrieved from http://www.dot.state.ak.us/amhs/communities.shtml. Retrieved on 11.09.2015. 23 2014 Alaska Housing Assessment: Kenai Peninsula Borough, 2014. 24 Ibid. Kenai Peninsula Comprehensive Economic Development Strategy Page 30 Dollars 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 Average annual home energy costs vs. Energy consumption Annual Energy Cost, $ Annual Energy Use (MMBTU/Year) 4�N 5,999 M M BTU/Yea r 300 250 200 150 100 50 0 Kenai Kenai Sterling Homer Nikiski Seward Anchor Point Ninilchik Seldovia Nanwalek Peninsula Figure 13: Average annual home energy costs vs. Energy consumption Source: 2014 Alaska Housing Assessment: Kenai Peninsula Borough, 2014 The graph above shows that the highest energy consumption is in Nikiski — about 265 MMBTU per year. The lowest is in Nanwalek at 126 MMBTU per year. Overall, on the Peninsula, the most often used heating fuel is gas (43.6%) followed by fuel oil, kerosene, etc. (38.2%) wood (7.4%) bottled, tank, or LP gas (6.3%), and electricity (3.4%).25 Table 5 contains information on prices for different types of energy in the Kenai Peninsula Borough. Table 5: Energy cost comparison for: Anchorage, KPB, and Mat -Su Ireating --Electricity ($/ kWh •Propane • . • - 0.15 ($/galL $3.98 $3.85 $3.73 0.15 $4.54 $3.85 - • - 0.24 $4.66 $4.28 $4.12 Kenai0.24 $4.77 $4.41 $4.15 . • 0.22 $4.80 $4.34 $3.38 - • • $5.12 $5.13 - Source: 2015 Kenai Peninsula Situations and Prospects Based on the data provided in the table, the highest electricity price is in Homer and Kenai (city), and the lowest in the region is in Seward. Overall, electricity on the Peninsula is more expensive than in Anchorage or the Mat -Su Valley. The same is true of heating oil, gasoline, and propane prices. 25 City -Data: Kenai Peninsula Borough. Retrieved from http://www.city-data.com/county/Kenai Peninsula Borough-AK.html. Retrieved on 11.09.2015. Kenai Peninsula Comprehensive Economic Development Strategy Page 31 Most of the communities in the Kenai Peninsula Borough are not eligible for the power -cost equalization program, an energy subsidization program run by the state. In fact, there are three main companies providing electric power to the region (see Figure 14): • Homer Electric Association serves most communities on the west side of the Kenai Peninsula, from Kenai and Soldotna to the non -highway communities on the south side of Kachemak Bay. It buys most electricity from Chugach Electric and operates the Bradley Lake Hydroelectric Facility for the Alaska Energy Authority. It is cooperatively owned by the ratepayers. • Seward Electric System is the smallest Railbelt utility, providing electricity only to Seward, on the east side of the Kenai Peninsula. It buys most power from Chugach Electric and is owned by the City of Seward. • Chugach Electric Association is the largest utility in the state, directly providing electricity to most of Anchorage and other communities in Southcentral Alaska. In the Borough, it sells power to communities on the northern and eastern sides of the Peninsula, as well as Tyonek. It owns the Cooper Lake Hydroelectric Facility near Cooper Landing.26 Like the Homer Electric Association, it is a member -owned cooperative. Maw MEW x alrn r AL fiffi BEChit so'cid don Tyanek ArKhorage-------- 7 Va Pi H ne Girdwood Tatillek � lai 4 I�itti o * .&Eardoya Soldotna moffie Pas mega Yakutat nilchik 'a r= Ancharage Munidpa I Eight & Power iro Eay ArKLhoF kL .. # Humr swia E Poo graham Ser%fard Electric Service Natural Gas Diesel Ier `'.1 aHrn� r El��tri� .ssiati Orinkir Hydropower I Figure 14: Power Provider in KPB Source: http://www.iser.uaa.alaska.edu/Publications/2012 07-RS-EnergizingAlaska.pdf. Most of the Borough is connected to the state electrical intertie, which links most of the state's highway - accessible (Railbelt) communities, providing relatively low cost power compared to rural Alaska. Alaska's Railbelt region includes about 75% of all Alaskans. These communities rely on natural gas from Cook Inlet to generate more than 90% of electricity. All Railbelt utilities share hydropower from the state-owned Bradley Lake Dam on the Kenai Peninsula, and additional sources of hydropower.27 26 How electricity is generated in Alaska. Retrieved from http://www.iser.uaa.alasl<a.edu/Publications/2012 07-RS- EnergizingAlaska.pdf. Retrieved on 11.05.2015. 27 http://www.iser.uaa.alaska.edu/Publications/2012 07-RS-EnergizingAlaska.pdf Kenai Peninsula Comprehensive Economic Development Strategy Page 32 Communications General Communication Inc. (GCI) and Alaska Communications (AC) are the two main providers of internet, telephone, and cellular services. The former is also is also a leading provider of cable TV services. Information on broadband access and cable TV service prices is provided below (see Table 6). Table 6: TV and Internet Rates $59.99-$174.99 per month $59.99-$174.99 per month $59.99-$134.99 per month $29.99-$44.99 $29.99-$44.99 $29.99-$44.99 About $79.99 per month About $79.99 per month About $79.99 per month Source: GO and Alaska Communications website. Internet price depends on the speed of connection and the volume of information for download for every specific plan in Kenai, Soldotna and Homer. TV service price depends primarily on number of channels. V. Business Development: Industry Sector Analysis. Utilizing Location Quotient Analysis Location quotients (LQ's) are ratios that compare the concentration of employment by sector in a defined region to that of a larger area.28 In this case, location quotients are used to compare Kenai Peninsula Borough employment by industry to those of the state as a whole. LQ's are an indicator of economic specialization for regions —as an example, parts of the industrial Midwest have high LQ's in manufacturing, meaning they have a higher concentration of manufacturing employment than the nation a whole. An LQ of 1.0 means employment in that sector is average for the state. Greater than 1.0 means higher than average, and less than 1.0 indicates below average concentration.29 Industries were broken into quadrants based on location quotient and growth rates, which can be seen in Table 7. 28 Location Quotient Calculator. Retrieved from http://www.bls.gov/cew/cewlq.htm. Retrieved on 10.22.2015. 29 Traditionally Quarterly Census of Employment and Wages (QCEW) data is used to calculate location quotients, but as on Peninsula there is a significant number of self-employed commercial fishermen and employment in this area is not counted in QCEW. US Census Nonemployer Statistics contains information on earnings and counts self-employed individuals and sole proprietors that is why it was also taken into account. Kenai Peninsula Comprehensive Economic Development Strategy a Page 33 Table 7: Summary of industry analysis Star industries Mature industries Watch -list industries Challenge industries Opportunity industries Agriculture, forestry, fishing and hunting Educational services Health care Utilities Transportation and warehousing Construction Administrative and waste services Professional and techincal Real estate Mining, oil and gas services Financial services and Manufacturing Wholesale trade insurance Real estate and Accommodation and Information rental leasing food service Management of companies and enterprises Note: Industries are listed from highest LQ to lowest LQ, and positive growth rates are shown with black and negative growth rates are shown in red, within each quadrant. Star industries (high concentration, positive growth): Industries in this segment are more concentrated in the Borough than at the state level (LQ>1). Star industries act as economic drivers for the region. All the listed industries had a positive employment growth rate from 2004 to 2013, so their role in the regional economy is likely to grow. Local decision makers should pay close attention to industries with LQ>1, as negative trends in these industries could mean significant job losses. Industries in this sector include: • Health care • Real estate and rental and leasing • Real Estate Mature industries (high concentration, negative growth): Industries in this segment are more concentrated in the Borough than at the state level (LQ>1), and are usually export -oriented (meaning the bulk of sales come from outside the region though not necessarily outside the country). These industries are drivers of the local economy, but the same time they show a negative employment growth rate from 2004 to 20131 meaning that they are becoming less concentrated. A highly concentrated industry (LQ >1), having a negative growth rate could indicate risk for the regional economy. Oil and gas, in particular, has shown strong growth in the past but is currently retrenching. Industries in this sector include: • Accommodation and food services (included in tourism industry analysis) • Agriculture, forestry, fishing and hunting • Mining, oil and gas • Utilities Watch -list industries (high concentration, negative growth): There are industries with declining employment, which should be closely watched by decision -makers, as there could be potential challenges in the immediate future. Industries in this sector include: • Manufacturing (including refining and fish processing) Kenai Peninsula Comprehensive Economic Development Strategy 41P Page 34 • Construction Challenge industries (low concentration, negative growth): Industries in this segment are less concentrated in the Borough than at the state level, (LQ<1), and are declining as a share of employment. Wholesale trade is a relatively small industry (only 1.2% of the total employment in 2013), and it has a negative growth rate (-32% in 2013 compared with 2012) and declining concentration, which indicates potential problems. Industries in this sector include: • Wholesale trade • Administrative and waste services Opportunity industries (low concentration, positive growth): Industries in this segment are less concentrated in the Borough than at the state level (LQ<1). As growth rate in this sector is positive, industries are growing faster than at the state level, but are not yet as concentrated. In other words, these industries may have opportunities for job growth. These industries are still small, but fast-growing. Industries in this sector include: • Information • Professional and technical services • Financial services and insurance • Transportation and warehousing • Educational services • Management of companies and enterprises A location quotient map was developed based on Borough employment data. Industries can be classified on five main categories based on their location on the map. Figure 15 represents LQ analysis for Kenai Peninsula Borough industries. Kenai Peninsula Comprehensive Economic Development Strategy Page 35 m 0 lw E 0 ilt ro Lj u 0 C cr J 0 Ln Nf to Ln m r z � J LA F}' !Fi cu u di li•I Ln m 4-J m T] G m E 0 G u U 4a4 wti G 4 m wl Lei ku :3 u ro w LA 0 L (! cu u m 0 Lp C a vi G_ Q LINE 46 �J E IV �C m c 0 0 0 0 0 4-; N r i U a-•+ C� C� 0 N .L N .C: Q L Q N N L Q 0- 0 N u N vi t V 3 � � O Qj o +� o -C Q z " N cr Lq ,O u a) Q) N L O J 4-) (/) M E O v E N E I _O N Q) aA U o O Ln cr :3 N N Q U O LJJ V can • v) J 4-1 I C .. Ln -C cr N Q) �D i u C: ,z 0 0 O m cn z U Q_ Star Industries — Local Economic Drivers Healthcare and Social Assistance This sector has three major employers: Central Peninsula Hospital (CPH), South Peninsula Hospital (SPH) and Dena'ina Wellness Center (DWC.) CPH is the largest with a roughly 49-bed hospital and 60-bed house with a long-term skilled nursing center, six family and specialty physician services clinics, and a new specialty medical office building that is scheduled to open in 2016.30 SPH is located in Homer and includes an emergency room, 18-bed acute care, and other health and wellness services. DWC offers medical care for Alaska Native and American Indian beneficiaries in the region. The Dena'ina Wellness Center offers medical, dental, behavioral health, chemical dependency, wellness, physical therapy, pharmacy support and traditional healing services.31 Healthcare is a large employer in the region, accounting for 16% of total employment. It plays an important role in the region. There are three sectors, each roughly equal in terms of employment: • Hospitals, nursing, and residential care facilities - 35% of the industry, 1,209 jobs in 2013 • Social assistance - 27% of the industry, 936 jobs in 2013 • Ambulatory health care services - 39% of the industry, 1,346 jobs in 2013 4m I1 u ate r- h e e th ce re s e r,r c e s 10. 0 H a s p iT als' Nursing hnd Kesi*ential 0.0% scare f-a b1fties - � Sri a I Assistance -20_ LQ 201 Figure 16: Location Quotient in 2013 vs. Location Quotient Growth Rate from 2012 to 2013 in health care and social assistance Source: Quarterly Census of Employment and Wages, Census Nonemployer Statistics. The Hospitals, Nursing and Residential Care facilities sector has an employment concentration greater than the state (LQ>1). This sector had a slowing growth rate in 2013, but with a new wellness center that opened in 2014 in Kenai, faster growth should materialize. Three potential future sources of growth for the healthcare industry are: Medicaid expansion (healthcare reform), aging population healthcare, and 30 2015 Kenai Peninsula Situations and Prospects. April 2015. — P. 39. 31 Dena'ina Wellness Center. Retrieved from http://www.kenaitze.org/index.php/dwc-menu/. Retrieved on 10.30.2015. Kenai Peninsula Comprehensive Economic Development Strategy J Page 37 services for LNG project employees. These changes would bring additional demand for services in all three sectors mentioned above and increase healthcare employment in the region. Real Estate and Retail Trade: Two other star industries are real estate and retail trade. About 16.7% of total employment, 3,646 jobs, are in these industries. Most sectors in the retail trade industry have less than 300 employees, which is less than 1.5% of total employment. For the current analysis we will focus on sectors with more than 500 employees including: • Food and beverage stores - 19.5% of the industry, 709 jobs in 2013 • General merchandise stores —15.4% of the industry, 561 jobs in 2013 LQ Growth Rate 7 20% Real estate and rental and Electronics and appliance leasing stores Food and beverage stores 10% Gasoline stations General merchandise stores Building material and % C) Clothing and clothing U 0 0 garden supply stores of accessories stores Health and personal care �\ stores 0.4 '- i.30 � i.ti� i.yu 7 Nonstore retailers A o Furniture and home Miscellaneous store -10% furnishings stores Sports, hobby, music retailers 0 instrument, book stores Motor vehicle and parts -20% dealers LQ 2013 Figure 17: Location Quotient in 2013 vs. Location Quotient Growth Rate from 2012 to 2013 in Real Estate and Retail Trade Source: Quarterly Census of Employment and Wages, Census Nonemployer Statistics. Real estate and rental and leasing has an employment concentration that is similar to the state. This sector had positive growth, about 9%, from 2012-2013, which could be due to the increase in the number of houses being built. This sector includes: car rental, recreational vehicle rental, recreational goods rental, real estate and property management. The food and beverage stores category has an employment concentration greater than the state (LQ>1). This sector had positive growth, about 10% from 2012-2013. General merchandise stores has an employment concentration less than the state (LQ<1). It had almost zero growth from 2012-2013. Kenai Peninsula Comprehensive Economic Development Strategy a Page 38 Government Sector Government employment plays an important role in the Kenai Peninsula Borough. Based on Quarterly Employment Census data, about 26% of total employment comes from the public sector, which is about 51012 jobs in federal, state, and local government (see Appendix 18). Borough Government Employment Federal r 6.0 State 25.2% Loca 1 68.8% Figure 18: Kenai Government Employment for the First quarter of 2015 Source: Based on http://Iabor.alaska.gov/research/gcew/eel4.pdf Within the public sector jobs in Kenai Peninsula Borough, about 68% are in local government (see Figure 18). This share did not change significantly over the last five years, and the share of federal and state employment in the Borough also held steady. Members of the military make up the majority of the federal employment. The vast majority of local government employment is in education services — about 65% in 2013 based on IMPLAN analysis. Table 8: Local government employment � � rM70OW Federal 0.41 0.41 0.39 State 0.86 0.83 0.80 0.38 0.34 0.79 0.79 Loca 1 1.35 1.35 1.37 1.38 1.36 Source: Based on Quarterly Census of Employment and Wages, Census Nonemployer Statistics Location quotient analysis for the government sector shows that local government on the Kenai Peninsula is more concentrated than at the state level, (LQ>1). In 2015, this concentration slightly decreased. The State government LQ (for the Borough) is close to 1, indicating employment concentration similar to the state level. Federal government is less represented on the Kenai Peninsula than Alaska overall, (LQ<1). This is apparent in the fact that on the Peninsula there are not large federal military bases. Kenai Peninsula Comprehensive Economic Development Strategy a Page 39 Mature industries Tourism In 2013, tourism brought in $88M in sales, a number expected to increase with economic growth in the Lower 48, which drives visitation. According to sales tax data, the largest share of visitor -related sales occur in Seward, about 20% ($51.7 million in 2013), followed by Homer and Soldotna with 17% and 14% respectively. Seward and Homer provide visitors with a highway -accessible scenic coastal experience, while Soldotna sits on the world-renowned Kenai River and hosts much of the Borough's retail. Tourism most closely follows national economic cycles. Since the industry relies heavily on Lower 48 visitors, any downturn in the economy causes fewer people to visit Alaska, and those that come spend less while in -state. Information on visitor spending spans 2008 to 2013 (see Appendix 10), and shows that a 13% decline occurred between 2008 and 2009. This led to tourism employment dropping 8.6% (see Figure 19). The largest declines were in the water guiding, and hotel/motel/bed & breakfast sectors — 24% and 16% respectively (see Appendix 10). By 2012 tourism employment had recovered to the pre - downturn level. 2,780 2,730 2,680 2,630 2,580 2,530 2,480 2,430 2,380 2,330 2,280 Tourism employment in the KPB and Real GDP, 2002-2013 Billion $ 16,000 M 0 !l 10000 Total Tourism m<>=Real GDP, US Total, billion Dollars 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Figure 19: Tourism Employment in the KPB and Real GDP, 2002-2013 Source: Quarterly Census Employment and Wages, Bureau of Economic Analysis 15,500 15,000 14,500 14,000 13,500 13,000 12,500 12,000 In 2013 tourism -related sectors accounted for almost 16% of the total employment in the Kenai Peninsula Borough, making it the second largest employment industry after healthcare and one of the primary economic drivers in the region. Tourism is a seasonal industry in the region, which causes significant fluctuations in employment numbers season -to -season, the average monthly employment of 2,648 includes a summer high of over 3,700 employees.32 In 2014 there was an increase in the number of visitors coming to the KPB, compared to previous years. This contributed to a modest (1.3%) increase in 32 2015 Kenai Peninsula Situations and Prospects. April 2015. — P. 66. Kenai Peninsula Comprehensive Economic Development Strategy a Page 40 employment. While there is no one Census category that encapsulates tourism's many categories, there are two sectors that serve as proxies: • Accommodation and food services — 2,568 jobs in 2013 • Arts, entertainment, and recreation — 608 jobs in 2013 L.Q G rowth Rats 16-0 12-0 8.0 4.0 0. 20.c .5 a ntE Tr .- ve and a rra r Ere n- ent and cen—c a n d s ightseei rig tra nspo rtat io n 1-2 o rr.m odati on food servicer- 1.4 LQ 2013 Figure 20: Location Quotient in 2013 vs. Location Quotient Growth Rate from 2012 to 2013 in Tourism Source: Quarterly Census of Employment and Wages, Census Nonemployer Statistics. Accommodation and food services is the largest sector of tourism within the region. The employment concentration is greater than at the state level (LQ>1). There was no growth between 2012 and 2013. With that being said, this industry alternates between being a driver of growth, and maturing into a steady, slow growth industry. Arts, entertainment, and recreation is another tourism -related category. Employment here is less concentrated than at the state level (LQ<1). It has a negative growth rate with a 2% drop in employment from 2012-2013. This sub -industry brings more than $15M in visitors spending every year, having a significant impact on the region (see Appendix 19). Agriculture, forestry, fishing and hunting Fisheries have a long history in the Borough. Seven main species are harvested: salmon (about 22 fisheries), three types of crab (about 9 fisheries), halibut (3 fisheries), shrimp, clams (12 fisheries), herring (about 18 fisheries), and groundfish (about 17 fisheries.) Based on Fish and Game and NOAA Fisheries Service information most salmon (39%)and halibut(61%) in 2014were harvested in Homer. Most harvest earnings are coming from salmon (about $72 million), which is followed by halibut (about $14 million), and crab (about $10 million, see Figure 21). Kenai Peninsula Comprehensive Economic Development Strategy Page 41 Gross Earnings vs. Gross Pounds Landed, 2014 Million Million $ llion Pounds 80 100 70 O 80 60 ■ Estimated Gross Earnings, million $ 50 • Total Pounds Landed, million pounds 60 40 L=j 30 40 20 20 10 Crab Halibut Herring Other Other Shellfish Sablefish Salmon Groundfish Figure 21: Gross Earnings vs. Gross Pounds Landed, 2014 Source: https://www.cfec.state.ak.us/gpbycen/2014/122.htm From 2003 to 2013 there were three dips in Kenai Peninsula Borough employment: 2006, 2008-2009, and 2012. One factor was poor fish harvests and thus low fishery employment (see Figure 22). For example, in 2006 total employment in fishing fell almost 8% while the harvest (total pounds landed) decreased about 19%. The next decrease started in 2008, and employment bottomed out in 2009: a total decrease in two years of 5.5%. An interesting trend occurred in 2012, when total employment dropped about 8% without a substantial change in fish harvest. Information for 2014 fishing employment trends is not available yet, but Cook Inlet commercial salmon harvest decreased 21% that year. Agriculture, Forestry, Fishing, and Hunting Workforce and Total fish harvested in Kenai 2002-2013 Million Pounds 200.00 180.00 O 160.00 140.00 � 120.00 jjjjj�������$ 0 0 100.00 0 80.00 Workforce 1,850 0 11800 P 1,750 1,700 1,650 11600 1,550 1,500 1A50 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 O Total Pounds Landed, Million Pounds ®Total Workforce Figure 22: Agriculture, Forestry, Fishing and Hunting Workforce & Total fish harvested in Kenai, 2002-2013 Source: US Census Nonemployer Statistics data, Quarterly Census Employment and Wages, Commercial Fisheries Entry Commission Fishery Statistics - Participation and Earnings. Kenai Peninsula Comprehensive Economic Development Strategy Page 42 RP Ntl n %1 4%& NA 11 4r41rw1k .i.v.i Llr lxa eu�r.it:e According to the State Division of Agriculture, there are about 55 farms registered in the Kenai Peninsula Borough.33 Most farms listed on the Division website focus on flowers (mostly peonies), vegetables, herbs and teas, and mushrooms. In addition to agriculture, the Kenai Peninsula Borough contains part of the Chugach National Forest, which is the second largest national forest in the United States. Most of the commercial timber harvest is located in the coastal zone, but only 6% of the land is considered productive, so harvests are relatively small compared to other national forests. The primary tree species are Sitka and White Spruce. Based on Alaska Forest Facts, spruce bark beetle infestations have killed many of the trees on the Chugach in recent years.34The entire Chugach, and much of the Kenai region, has been affected by this pest. There are 19 businesses registered under the following forestry industries and located in Kenai Peninsula Borough: Timber tract operations, forest nurseries and gathering of forest products, and logging. Table 9: Location and number of logging products and operations Number NAICS and Location 113110 - TIMBER TRACT OPERATIONS Businesses Kenai Ninilchik 1� Talkeetna 1 113210 - FOREST NURSERIES AND GATHERING OF FOREST PRODUCTS 4 Cooper Landing 1 Kasilof 1 Ninilchik 1 Sewa rd 1 113310 - LOGGING 12 Anchor Point 1 Kasilof 1 Kenai 1 Nikiski 1 Ninilchik 1 Sewa rd 1 Soldotna 6 Source: Based on Department of Commerce and Community Development Business License Database. Agriculture, forestry, fishing, and hunting is a mature industry. In 2013 employment was 1,762, equal to 8% of the total employment within the Borough. There are four sectors within this industry including: • Fishing, hunting and trapping (98% of which is commercial fishing) • Agriculture and forestry support activities • Forestry and logging 33 Kenai Peninsula Alaska Farms. Retrieved from http://dnr.alaska.gov/ag/sourcebook/KNindex2014.html. Retrieved on 12.21.2015. 34 Alaska Forest Facts. Retrieved from http://www.akforest.org/facts.htm. Retrieved on 12.22.2015. Kenai Peninsula Comprehensive Economic Development Strategy a Page 43 • Crop production ya Growth Rare 32 2 24Cro p proij u c a r i 2 16 For try and 12 Ida ng 4 0 U. lio 0-40 AVicurcure anei forestry 56LP acovi, 0- 0-190 LQ 201 Figure 23: Location Quotient in 2013 vs. Location Quotient Growth Rate from 2012 to 2013 in Agriculture, forestry, fishing and hunting Source: Quarterly Census of Employment and Wages, Census Nonemployer Statistics Fishing, hunting and trapping has an employment concentration greater than the state (LQ>1). In a ten- year perspective, the industry concentration declined 3.7%. However, from 2012-2013 it had a moderate growth rate of 3.8%. In 2013, employment in this sector increased 7%. However, even small changes in employment resulting from poor harvests, regulatory burdens, or weak prices should be watched closely. Agriculture and forestry support activities employment concentration is less than the state, (LQ<1). Support services had an LQ growth rate equal to 30% between 2012 and 2013. This sector provides services that are an essential part of agricultural and forestry production.35 Mining, Oil and Gas Aggregated mining, quarrying, and oil and gas extraction shows the largest growth among all industries — 31% in 2013. The oil and gas industry in the Kenai Peninsula Borough, centered on the Cook Inlet Basin, has a significant influence on the region. Appendix 12 shows total mining sector employment and Cook Inlet oil production from 2002-2014.Outside this period, oil production peaked at 230,000 barrels per day in 1970.36 The lowest level of production was 2009, when the figure reached 7,500 barrels per day, and it was believed that more than 90% of the Basin's recoverable oil reserves were depleted. By that time the Kenai Peninsula Borough (and Southcentral Alaska as a whole) faced energy shortages: large industrial producers slowed operations until the Alaska Legislature passed the "Cook Inlet Recovery Act," expanding capital credits for producers and leading to increased operations by smaller drilling companies.37 There are ongoing talks of altering or sunsetting the tax credit programs, but as a result of the initiative, oil 35 NAICS Definition. Retrieved from http://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=115&search=2012. Retrieved on 10.27.2015. 36 AOGA Fact Sheet: Cook Inlet Oil and Gas Production. Retrieved from http://www.aoga.org/sites/default/files/news/cook inlet fact sheet final.pdf. Retrieved on 10.01.2015. 37 Ibid. Kenai Peninsula Comprehensive Economic Development Strategy Page 44 production increased 35.5% in 2010 from 7,209 to 10,244 barrels per day and kept increasing for the next four years. As production was decreasing in 2009, it caused continuous decreases in sector employment from 2008 to 2011; though it recovered in the following two years, reaching a high in 2013 (1,540 employees), when ANS West Coast Average Oil Spot Price also was at a high point $107.60 per barrel (see Appendix 12). In 2014, oil prices began declining, causing a reduction in employment in the industry. The industry accounts for 7% of overall employment, predominantly associated with oil and gas. Jobs in oil and gas extraction are centered on the Cook Inlet Basin, which has a significant influence on the region. Taking into account direct and indirect economic impacts, this industry provides about 6,000 jobs, meaning that approximately in 8 jobs are tied to this industry, and $430million in annual wages. Sectors included in this industry are: • Oil and gas extraction —384 jobs in 2013 • Support activities for mining —1,115 jobs in 2013 • Mining —411 jobs in 2013 LQ Growth Rat R _11 C and onas- ex1r-eCt CI-1 1 1 -2 3 -4 Support attiviti es r fnining 4il I I LQ 013 Figure 24: Location Quotient in 2013 vs. Location Quotient Growth Rate from 2012 to 2013 in mining, oil and gas Source: Quarterly Census of Employment and Wages, Census Nonemployer Statistics. Support activities for mining has an employment concentration greater than the state, (LQ>1). Support activities for mining had a negative growth rate from 2012-2013. However, there is great potential for growth in the years ahead because of the proposed gasoline mega -project on the horizon. The Alaska Liquefied Natural Gas (LNG) Project calls for a pipeline from the North Slope to Nikiski, where an LNG plant would be located. If implemented, Alaska LNG would result in tens of billions in capital expenditure, and bring 9,000-15,000 jobs during construction and 1,000 long-term jobs statewide, many of which would be in the Borough.38 If BP, ConocoPhillips, ExxonMobil, and the State of Alaska continue to move forward 38 AOGA Fact Sheet: Cook Inlet Oil and Gas Production. Retrieved from http://www.aoga.org/sites/default/files/news/cook inlet fact sheet final.pdf. Retrieved on 10.01.2015. Kenai Peninsula Comprehensive Economic Development Strategy a Page 45 with the Alaska LNG Project through the front-end engineering and design stage, oil and gas extraction and support activities will grow. Which will bring additional employment in industries such as transportation, warehousing and wholesale trade, healthcare, and many others. While often overlooked in the discussion about oil and gas, the mining industry still plays a significant role in the Borough. Gravel pits are in operation along the Seward and Sterling Highways, and there are active placer gold miners in the Hope and Canyon Creek areas. In addition, PacRim Coal is developing the Chuitna Coal Project on the West side of Cook Inlet (within Borough boundaries) which could begin construction in 2018. The company believes the project will create 500 direct jobs during the construction phase, and 250 year-round jobs once operations begin.39 Watch -list industries Construction The construction industry is another traditional driver of the regional economy, providing 1,618 jobs in 2013. Construction provides an average of 8.5% of total employment in the region (see Appendix 9). Borough sales tax records list 699 construction businesses physically located in the region.40 There were two significant declines in construction employment since 2003: 2006, when it dropped by 2.2%, and a more prolonged decline that started in 2008 and lasted until 2012, with an overall drop of 5.5 % (see Appendix 9). A period of decreased sales is usually followed by decreased construction employment and vice versa. The first graph in Appendix 9 shows the lag between gross construction sales and employment. Graph 2 in Appendix 9 shows that construction employment trends also follow the number of houses built in the region. The employment growth rate between 2012 and 2013 was 5%. In 2013 sales began declining, so there may be a decline in employment in the future. However, as of 2013, all 3 sectors showed increased employment. The 3 sectors within the construction industry are: • Construction of buildings — 28% of the industry, 456 jobs in 2013 • Specialty trade contractors — 60% of the industry, 964 jobs in 2013 • Heavy and civil engineering construction —12% of the industry, 198 jobs in 2013 39 Dan Graham, Chuitna Coal Project Manager, Personal Communication. 40 2015 Kenai Peninsula Situations and Prospects. April 2015. — P. 66. Kenai Peninsula Comprehensive Economic Development Strategy a Page 46 LQ Growth Rate 20.E 10_ . -10. -0_ '51 U C11,t.9 bui I lin s 1 .2 SRecialty trade r-ontractors UQ 2.0 "? 7 Figure 25: Location Quotient in 2013 vs. Location Quotient Growth Rate from 2012 to 2013 in Construction Source: Quarterly Census of Employment and Wages, Census Nonemployer Statistics Specialty trade contractors form the largest construction sector, with a concentration higher than at the state level (LQ>1). This includes companies focusing on specific activities like pouring concrete, site preparation, plumbing, painting, or electrical work.41 This sector's growth rate is almost zero, which indicates it should be watched for signs of diminishing employment. The heavy and civil engineering construction sector has been in decline for years and never reached the statewide concentration (LQ<1). LNG project implementation would change this situation and potentially make this category a key driver of employment, at least during the construction phase. For the region to take advantage of this opportunity, significant investments in workforce development and attraction of specialists would be logical steps. The LNG project would likewise impact every subsector of construction. Construction of buildings has an employment concentration less than at the state level, (LQ<1). Construction of buildings employment closely follows trends in homebuilding. This sector grew prior to 20141 but 2015 projections show declining homebuilding activity, possibly signaling falling employment in this sector. Manufacturing Manufacturing accounts for about 5% of total employment in the Kenai Peninsula Borough. In the Borough there are two main manufacturing sectors: food manufacturing and fabricated metal product manufacturing. Petroleum and coal products manufacturing (i.e. jobs at the Port of Nikiski) would also be included in this analysis. However the number of employees for this sub -sector is not disclosed to the Bureau of Labor Statistics. The largest sub -sectors of the other manufacturing are: beverage and tobacco product manufacturing, and transportation equipment manufacturing. Combined employment is these two subsectors based on only "Quarterly Census of Employment and Wages" data is about 105. 41 2012NAICSDefinitions.Retrievedfrom http://www.census.gov/cgibin/sssd/naics/naicsrch?code=238&search=2012. Retrieved on 10.28.2015. Kenai Peninsula Comprehensive Economic Development Strategy Page 47 LQ Growth Rate 10% Other Manufacturing 5% Fabricated metal 0 product manufacturing 0 0% 0.50 0.80 1.10 1.40 1.70 2.00 Food -5% oranufacturing -10% LQ 2013 Figure 26: Location Quotient in 2013 vs. Location Quotient Growth Rate from 2012 to 2013 in Manufacturing Source: Quarterly Census of Employment and Wages, Census Nonemployer Statistics Food manufacturing is less concentrated than at the state level (LQ<1), and employment decreased 9% in 2013. This sector includes fresh and frozen seafood processing, which is a key support sector for the fishing industry. Based on Alaska Department of Labor and Workforce Development information, about 8.2% of the state processing employment is located in Kenai Peninsula Borough (2,043 employees).42 In the Borough 56.2% of employees come from out-of-state for seasonal employment. At the state level about 69.3% of seafood processing employees are coming from out-of-state.43 Fabricated and metal product manufacturing employment is more concentrated that at the state level (LQ>1), but employment declined in 2013 by 1%. This sector tends to follow trends in oil and gas sector, which purchases metal components. Overall, employment in the manufacturing industry declined — about 22% from 2004 to 2013. Challenged Industries Wholesale trade and Administrative and support services Wholesale trade is not a driver of the economy, but it is connected with industries such as mining (including oil and gas), transportation, warehousing, and others playing important roles in the region. Which is why declining growth and employment concentration are potentially problematic. About 4% of Kenai Peninsula Borough employment is in these industries, in which employment concentration shrank between 2012 and 2013. There were 1,697 jobs in this quadrant in 2013 spread across 5 sectors, including: • Merchant wholesales of durable goods • Merchant wholesales of non -durable goods • Electronic markets, agents and brokers • Administrative and support services 42 Seafood Processing Employment by Borough or Census Area, 2012. Retrieved from http://Iaborstats.alaska.gov/seafood/Southcentral/SCSFPBorca.pdf. Retrieved on 12.18.2015. 43 Alaska Statewide Seafood Industry, 2001-2012. Retrieved from http://Iaborstats.alaska.gov/seafood/statewide/AKSFPOver.pdf. Retrieved on 12.18.2015 Kenai Peninsula Comprehensive Economic Development Strategy Page 48 • Waste management and remediation services LQ Growth Rate 80% 75% 70% 65 % 60% 55% 50% 45 % 40% 35% 30% 25% 20% 15% 10% 5% 0% Waste management and remediation services -5%0.80 wholesalers, Q.90 -10% nondurable goods -15% -20% �1 Electronic markets and agents and brokers Merchant wholesalers, durable goods O Administrativbl§nd 1.20 support services LQ 2013 Figure 27: Location Quotient in 2013 vs. Location Quotient Growth Rate from 2012 to 2013 in Challenge Industries Source: Quarterly Census of Employment and Wages, Census Nonemployer Statistics Merchant wholesales, non -durable goods employment is less concentrated than at the state level, (LQ<1). This sector showed 18.5% decline from 2012-2013. Non -durable goods merchant wholesale trade establishments are engaged in wholesaling products such as paper and paper products, chemicals and chemical products, drugs, textiles and textile products, apparel, footwear, groceries, farm products, petroleum and petroleum products, alcoholic beverages, books, magazines, newspapers, flowers and nursery stock, and tobacco products. Items must have a lifetime less than three years to fit into this category.44 Administrative and support services employment concentration is equal to the state level. This sector had insignificant growth from 2012-2013. This sector includes: employment services, business support, services to buildings and dwellings, investigation and security services, and travel arrangement and reservation services. Opportunity industries About 10% of total employment in the region (2,252 jobs) are inopportunity industries, those with a low concentration but fast growth rate. These industries have the potential to become major employment drivers in the future. Opportunity industries are: • Information • Professional and technical services • Financial services and insurance • Transportation and warehousing 44 2012 NAILS Definitions. Retrieved from http://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=424&search=2012. Retrieved on 11.01.2015. Kenai Peninsula Comprehensive Economic Development Strategy Page 49 • Management of companies and enterprises • Education services LQ Growth Rate 10.0% Telecommunications O 5.0% Professional and Other information technical services services 0.4 0. .8 1.0 1.2 1.4 1.6 1.8 2.0 2.2 -5.0% . 0 Credit Air transportation intermediation and -10.0% ` Educational services related activitiesSupportactivities -15.0% G for transportation Truck transportation -2o.o°i Transit and ground -25.0% passenger transportation Water transportation O 0 2.4 2.6 2.8 Scenic and sightseeing transportation 3.0 -30.0% LQ 2013 Figure 28: Location Quotient in 2013 vs. Location Quotient Growth Rate from 2012 to 2013 in Opportunity Industries Source: Quarterly Census of Employment and Wages, Census Nonemployer Statistics The category of professional, scientific and technical services is the largest opportunity sector with employment of 1,029, which continues to grow. Employment in the professional and technical services sector is less concentrated that at the state level (LQ<1). However, the employment in this sector has been growing. Interestingly, this fast-growing opportunity industry consists of specialized services that require advanced education. For instance, this category includes lawyers, architects, accountants, engineers, designers, and other professionals. The growth of this portion of the economy may reflect the growth of the "knowledge economy" in the Borough. Historically, many parts of the state contracted professional work from Anchorage or out-of-state, but it appears that a greater share of this work can be done locally —a positive development. Educational services has a concentration less than at the state level, (LQ<1), and it is declining further. It may reflect trends in high school enrollment, which has declined over the last 10 years; with less students enrolled, there is less demand for specialists providing educational services. It includes establishments that provide instruction and training in a wide variety of subjects. Services are provided by specialized establishments such as schools, colleges, universities, and training centers. These establishments may be privately -owned and operated for profit or not for profit, or they may be publicly -owned and operated. They may offer food and accommodation services to their students.45 The Kenai Peninsula Borough is accessible by water, railway, road, and from nine airfields. Depending on the source of information, there are between 150 and 300 large and small businesses in the transportation 45 2012 NAICS Definitions. Retrieved from http://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=238&search=2012. Retrieved on 11.01.2015. Kenai Peninsula Comprehensive Economic Development Strategy Page 50 and warehousing sector.46 Employment concentration increased from 2004 to 2013, however employment concentration is still less than at the state level (LQ<1). The recent decline in transportation volumes may be a good reason to watch this industry closely as it may face some challenges that can lead to employment decreases in the future. The sectors within transportation and warehousing include: • Water transportation • Air transportation • Track Transportation • Transit and ground passenger transportation • Support activities for transportation • Scenic and sightseeing transportation Resilience Component Challenges to economic resiliency The Kenai Peninsula Borough economy is more diversified than the state overall, according to employment figures. Even though the economy is diversified, several industries that act as economic drivers — oil and gas, healthcare, fisheries, and tourism are facing challenges. Sustainability of the Kenai economy depends mostly on the resilience of these industries against external threats and whether or not there are mechanisms in place to help overcome challenges. As previously stated, the fishing industry is heavily dependent on harvest figures and quotas distributed in a specific area. While quotas and harvest figures cannot be adequately address at the local level, other issues within the fishing and related industries can be addressed. One of the issues that can and should be addressed is the decline in fresh and frozen fish processing as a share of the food -manufacturing sub - sector. Seafood processing accounts for 500 jobs, which could ultimately be lost to offshore processors or those based in adjacent regions. Seafood processors serve an important function in enabling commercial fishermen to sell their catch. It is important for this sub -sector to thrive in the region so that the fishing industry is not only utilizing natural resources but also providing value added to the product, and therefore supporting economic development in the region through increased employment. The mining, oil and gas industry is dependent heavily on global markets both in terms of price and demand, which makes it vulnerable to external threats outside of local control. However, there are many opportunities associated with the Alaska LNG project. It will potentially have large impacts on industries associated with gas production, such as transportation and warehousing, healthcare, construction, and retail trade. There may be opportunities for workforce training to provide specialists needed in the project during the construction phase, and when an LNG plant, storage, and tanker terminal in Nikiski is in operation. Truck transportation and transportation support activities are sub -sectors of the oil and gas industry. These sub -sectors are areas of concern because they are becoming less concentrated than at the state level with constantly declining employment. These two sub -sectors may need additional attention from local decision makers and a greater understanding of the challenges they face. Likewise, the heavy and 46 2015 Kenai Peninsula Situations and Prospects. April 2015. — P. 64. Kenai Peninsula Comprehensive Economic Development Strategy a Page 51 civil engineering sub -sector has seen recent declines. This is problematic because it has the potential to become an economic driver due to oil and gas linkages. Among all healthcare sub -industries, social assistance is the one most in decline. This sector plays an important role in the Borough because of the aging population and potential need for more services in the near future. By 2042 the share of population over 65 years old is expected to grow from 14% in 2014 to 22%, an increase of about 6,000 people. In addition, the Alaska LNG project will potentially bring additional employees and their families to the region, which will further increase demand for healthcare services. Tourism is an industry that is highly vulnerable to economic conditions of the national economy. Lower 48 (or global) downturns cause sharp decreases in the number of tourists coming to Alaska, depressing jobs and sales tax receipts. Strategies to grow visitor revenues by extending "shoulder" seasons and increasing the average expenditure of visitors are worthy of careful consideration. Employment within the arts, entertainment, and recreation sub -sector is declining. Aside from its impact within the tourism sector, this is an area with strong implications for the livability and quality of life in the Borough. It could be addressed through placemaking initiatives, which seek to improve arts and entertainment options for residents. The Kenai Peninsula Mural project, along with art projects in libraries and parks throughout the region testify to the importance of arts within the Borough. Challenges to demographic resiliency There are several main challenges in regional demographics: 1. Aging population 2. Decreasing economically active population 3. Shortage of young individuals and families relocating to region The core problem is availability of well -paid jobs in the region that would potentially attract young professionals to move to the Kenai Peninsula Borough. In addition, the region is aging more rapidly than the rest of the state, and the popularity of the region as a retirement destination is related to this. It may be useful to develop programs that focus on attraction of young professionals and their families, highlighting the benefits of living in the Kenai Peninsula Borough. For example, the Borough has one of the lowest crime rates per capita in the state: only 1.91 crimes per 100 people in 2014, (compared to 6.13 in Anchorage, see Appendix 20). In addition, Borough housing prices are lower than in the Mat -Su Borough or in Anchorage. As the greatest number of people moving to the region come from the Municipality of Anchorage, Matanuska-Susitna Borough, and Fairbanks North Star Borough, a regional marketing program may be aimed at these regions specifically. As an additional factor, the relatively high internet speeds may be attractive to telecommuters wishing to take advantage of the region's natural amenities and high quality of life. If the Alaska LNG Project comes to fruition, an effort to attract new families to the Kenai Peninsula Borough should become more effective as jobs become more available. There may be some other areas lacking qualified employees, such as construction, healthcare, and some areas of tourism. It is important Kenai Peninsula Comprehensive Economic Development Strategy a Page 52 to support activities to fill these gaps, which will potentially increase employment and lead to economic diversification throughout the region. Public Engagement Public engagement for the project was conducted through surveys at community forums. Three surveys were administered: to Cook Inlet Aquaculture members, at a KPEDD board meeting, and at a community meeting. Respondents were generally optimistic about the economic future of the community. While respondents were generally amiable to increased population growth, many were worried about the repercussions of a population boom due to the construction of the LNG pipeline. They were supportive of the current education system, and many felt there was a need for increasing support for K-12, and post- secondary education. Borough residents felt optimistic about the future of the community, however a lack of economic opportunity and rising cost of living could drive some residents out. Finally, respondents were less than optimistic about the general health and future of the fisheries and commercial fishing industry. ype of Engagement Community Input Strategy Committee Surveys Events 0 • Tourism Focus Group with Kenai Peninsula Tourism Marketing Committee, January 2016 • Industry Outlook Forum business leader discussion (oil and gas representation), January, 2016 • Fisheries Focus Group in conjunction with Cook Inlet Aquaculture Association Annual Meeting, February 2016 • Kenai and Soldotna Chambers of Commerce joint meeting, February 2016 • Seward Chamber of Commerce meeting, February 2016 • Homer Chamber of Commerce Meeting, March 2016 • Seldovia Chamber of Commerce Meeting, March 2016 • Bimonthly KPEDD Board meetings, August 2015—April 2016 • In-depth goal formation workshop, March 2016 • Community Survey distributed at community meetings (Kenai, Soldotna, Seward, Homer, Seldovia, Industry Outlook Forum) • Fisheries survey distributed by Cook Inlet Aquaculture Association 1 • KPEDD Board pre -meeting survey Public Comment • 30-day comment period, document posted on KPEDD website, newspaper and media advertisements Figure 29: Public Participation Summary Economic state of Kenai Peninsula Borough About 75% of the community felt the peninsula was average or somewhat prosperous. Some factors that were adding or detracting from the prosperity level in the community were: uncertainty in the economy Kenai Peninsula Comprehensive Economic Development Strategy a Page 53 due to oil prices, the lack of year-round employment with corresponding salary, and increased tourism leading to additional jobs. A total 69% of the participants felt somewhat or very optimistic about the future of the peninsula. Some factors they felt were adding, or detracting to their optimism were: the uncertainty of the LNG pipeline and plant, lack of local and state assistance/funding for projects, and tourism as a consistent provider of jobs. Availability, training, and education of workforce About 61% of the community surveyed felt that there was not a sufficient workforce available. Some issues with workforce availability were: lack of seasonal workers, and available workers not being trained for industries with job openings. Workforce availability Respondents were also worried about the declining number of young } We have more available people investing and working in workforce than we need. commercial fishing. . we have a sufficient 52% of respondents felt that the available workforce. current workforce is not adequately, r . ■ We do not have a sufficient or far from prepared. Respondents available workforce. desired the following: better ■ We are far from having a alignment between local high sufficient available schools and local industry, customer workforce. service skills, and applicants with Figure 30: Workforce Availability additional skills/training. Numerous respondents suggested that industry specific training could be provided through partnerships and or vocational education program hosted at the Borough high schools. Approximately 75% of respondents felt the K-12 education system in the Kenai Peninsula was average to somewhat high quality. There was a lot of discussion of increasing funding for education, and making the K-12 and post-secondary/community college systems better. In particular aligning job training with growing industries such as healthcare. Fisheries There were three main themes discussed by respondents in the fisheries and aquaculture survey. Respondents were interested in having KPEDD provide the following: increased marketing, increased lobbying, and educational outreach. Respondents felt that KPEDD could be using targeted marketing to bring additional economic development to the region. Top marketing priorities included: Kenai Peninsula Comprehensive Economic Development Strategy Page 54 Figure 31: types of marketing desired by fisheries groups. Kenai Peninsula Comprehensive Economic Development Strategy Page 55 VI. SWOT Analysis Beneficial Strengths 1. Increasing graduation rate combined with decrease in dropout rates. 2. Kenai Peninsula College and AVTEC's ability to prepare professional workforce. 3. Housing prices are lower than in Anchorage and the Mat -Su. 4. Third lowest crime rate per capita in Alaska (among 20 tracked Boroughs and census areas). 6. Large communities are accessible by road. 7. The region is accessible by road, air, and water transportation as well as rail service in Seward. 8. Diverse economic base spans tourism, oil and gas, fisheries, healthcare, and construction. 9. Two Alaska Small Business Development Center offices: Homer and Kenai. 10. Two large ice -free ports with Coast Guard presence, Homer and Seward. 11. Natural gas expanded in 2015 to additional communities. Opportunities 1. Increase in employment in oil and gas, construction, and healthcare sectors associated with Alaska LNG. 2. Infrastructure to be built for Alaska LNG in Nikiski. 3. The oil and gas industry has a higher than average income in the region, so with an increase in employment in this sector, average income in the region will increase as well. 4. There are several opportunity industries that show high growth rates in comparison with the state: professional and technical services, telecommunications, administrative and support services, and information services. Kenai Peninsula Comprehensive Economic Development Strategy Page 56 Harmful Weaknesses 1. Aging population. 2. Economically active population (potential workforce) is shrinking. 3. Low in -migration. 4. Decreasing public school enrollment. 5. Higher prices than Anchorage and Mat -Su for groceries and gasoline. 6. In most communities in the region, the share of cost -burdened houses is about 29 %. 7. Tourism sector's dependence on the Lower 48 economic situation. 8. Fishing sector's dependence on harvest quota and fluctuation in the number of fish. 9. Decrease in oil production resulting from low prices. Threats 1. Lost opportunities if Alaska LNG is not implemented. 2. Possible economic downturn in the Lower 48 affecting tourism. 3. Further decrease in oil prices. 4. Uncertain economics of Alaska LNG. 5. Increase in salmon harvest limit in the region. 6. Seafood harvest subject to natural fluctuations. 7. There are several industries that are at risk: truck transportation, educational services, merchant wholesales (nondurable goods,) food manufacturing (including fish processing), general merchandise stores, arts, entertainment and recreation (part of tourism), heavy and civil engineering construction. 8. State funding for education, a key employer, is subject to cuts in coming years. VIII. Goals and Action Plan The following section describes the goals, objectives, strategies, partners, and metrics developed in response to background research, extensive public input, and the direction of the Strategy Committee. These six goals address regional partnerships, infrastructure and technology, workforce and human capital, business climate and entrepreneurship, and quality of place. Following lengthy discussions and reviews of data, the Strategy Committee believed that these areas served to holistically address the future economy of the Kenai Peninsula Borough by strengthening the capacity of the region to engage in economic development, supporting existing large employers, improving workforce readiness, investing in new business creation, and addressing quality of place factors that have recently been recognized as a driver of regional economies. Flowing from the SWOT analysis, community and industry feedback, and Strategy Committee guidance, these goals seek to maximize the use of the region's assets —diverse economy, reasonable cost of living, well -developed infrastructure, outdoor recreation —to build a more prosperous future. At the same time, the demographic challenges of a relatively small workforce and shocks in the price of oil are factors to be mitigated. Vision Statement "The Kenai Peninsula Borough is a collection of diverse and vibrant communities where citizens have year-round employment opportunities; businesses have access to a highly skilled, trained, and educated workforce; residents and visitors can enjoy the unique mix of urban and rural recreation activities; and responsible city and Borough management promotes economic growth and diversification." 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QL 3� o 3 LA (-+ r r 3 rD �� (D 3 o Ln10 O p 0 0 o o m --+-, rD r+ --, o o 0 rD au (DD o � o Ln 3 (D Ln Q r.. f Q (D 3 • • • O m aj =3 lu 3 LrD + m Q =3 fl.l N (D (D r+ � O (D L O I ° O l V O rD VMT J l /• Data Appendices for Kenai Peninsula Borough CEDS Appendix 1: Population by Community (U.S. Census Bureau) Salamatof CDP Nanwalek CDP Ridgeway CDP Kalifornsky CDP Moose Pass CDP Anchor Point CDP Fritz Creek CDP Kasilof CDP Sterling CDP Clam Gulch CDP Soldotna city Nikiski CDP Seldovia Village CDP Seward city Cohoe CDP Hope CDP Cooper Landing CDP Homer city Tyonek CDP Diamond Ridge CDP Bear Creek CDP Kenai city Funny River CDP Point Possession CDP Kachemak city Crown Point CDP Ninilchik CDP Happy Valley CDP Port Graham CDP Fox River CDP Primrose CDP Seldovia city Halibut Cove CDP Beluga CDP Lowell Point CDP Nikolaevsk CDP Sunrise CDP =MA 'IChang- 980 ====I 1112 0 14.3% 254 27 5 8.3% 21022 2,18 7 8.2% 7,850 81441 7.5% 219 23 4 6.8% 1,930 2,05 9 6.7% 1,932 2102 4 4.8% 549 57 4 4.6 51617 5,869 69 4.5 176 18 3 4.0% 4,163 41311 11 3.6% 4,493 4,65 2 3.5 165 17 0 3.0% 21693 21,768 2.8% 11364 1.394 94 2.2% 192 19 6 2.1% 289 29 5 2.1 5,003 5,0 Kenai Peninsula Comprehensive Economic Development Strategy Data Appendix Page 1 Appendix 2: Population Trends Population Growth Rates, 2014-2042 Kenai Alaska 4.00% 6.00% 0 Kenai Peninsula 3.50% ® mAlaska o 5.00/ 3.00% .00% 4 2.50%Air Cf 2.00% 3.00% 1.50% 0 2.00% 1.00% 1.00% 0.50% 0.00% 0.00% 2014 2017 2022 2027 2032 2037 2042 Source: Alaska Department of Labor Data Component of Population Growth in Kenai Peninsula, 2012-2042 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 2012-2017 2017-2022 2022-2027 2027-2032 2032-2037 2037-2042 ■ Natural Increase Migration Source: Department of Labor: http://Iaborstats.alaska.gov/pop/estimates/data/AgeBySexBCA.xls Kenai Peninsula Comprehensive Economic Development Strategy Data Appendix Page 2 Appendix 3: Age Distribution of Population in Kenai Peninsula Borough and Statewide Population by Age in Alaska, July 2014 90+ 80-84 ■ Male 70-74 60-64 50-54 IIh 40-44 — 30-34 20-24 10-14 0-4 O O O O O O O O O O O O O 00 00 00 00 00 00 00 00 00 00 00 00 Population by Age in Kenai Peninsula, July 2014 90+ Male 80-84 70-74 1 � 60-64 50-54 1 40-44 I I 30-34 20-24 SON 10-14 SON 0-4 00 00 00 00 00 00 00 00 00 00 00 Population by Age in Alaska, 2042 90+ MEN! �� ■ Male 80-84 � 70-74 �� Female i 60-64 k, IIIIIII 50-54 IF 40-44 11r,", 30-34 20-24 L- 10-14 F 0-4 00 R0 R0 R0 R0 00 (& 00 O 00 00 (& 00 R0 00 00 00 00 �O 00 �O 00 �Oe �O Population by Age in Kenai Peninsula, 2042 90+ i 80-84 ■ Male 70-74 � Female 1 60-64 50-54 f 1 40-44 30-34 20-24 10-14 MISSION 0-4 00 00 00 00 00 00 00 00 00 00 00 Source: Alaska Department of Labor: http://Iaborstats.alaska.gov/pop/estimates/data/AgeBySexBCA.xls Kenai Peninsula Comprehensive Economic Development Strategy Data Appendix Page 3 Appendix 4: Migration to and from Kenai Peninsula Borough Where people are moving from? Top 10 regions Sitka City and Other Lake and Peninsula Borough Nome Census Area 11% Borough 0% 2% 1%FJun eau City and Borough g 2% Valdez -Cordova Anchorage Census Area Municipality 4% 47% Bethel Census Area I 2% Kodiak Island Borough 4% Fairbanks North Star Matanuska-Susitna Borough Borough 9% L 18% Source: Alaska Department of Labor, PFD-Based Migration Indicator Data, http://Iaborstats.alaska.gov/pop/migration.htm Southeast Fairbanks Census Area L 1/ Juneau City ana Borough 2% Nome Census Area Kodiak Island Borough 2% Bethel Census Area Valdez -Cordova 2% Census Area L 2% "_T_ Fairbanks North Star Borough 6% Dillingham Census Area 1% Where people are moving to? Top 10 regions Other 7% Source: Alaska Department of Labor, PFD-Based Migration Indicator Data, http://Iaborstats.alaska.gov/pop/migration.htm Kenai Peninsula Comprehensive Economic Development Strategy Data Appendix Page 4 Appendix 5: Race and Ethnicity, 2010-2014 Population 60,000 50,060 51643 50,000 40,000 30,000 20,000 10,000 0 White 6,477 6800 548 762 11,165 1423 Black or African American Indian Asian American and Alaska Native Source: U.S. Census Bureau, Population Division Kenai Peninsula Comprehensive Economic Development Strategy Data Appendix Page 5 Growth Rate ■ 2010 45 ❑ 2014 40% O Growth Qn2 2AE; Native Hawaiian and Other Pacific Islander 35% 30% 25% 20% 15% 10% 5% 0% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 o Ln � m rn 00 �o r-I rn 0) r- O � Ln . . . . . . . . . . . . . . . . . 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O c� N 0 }, cn N cn cn Oi N E U E L•m i L oc Q L Q O m D 0 U Appendix 8: Fish harvest and Seafood industry employment Salmon, Halibut and Sablefish Harvest in Kenai Peninsula, Pounds 2002-2013 140,000,000 120,000,000 100,0001000 80,0001000 60,000,000 40,000,000 20,000,000 0 0 0 0 0 0 O C� 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 O Commercial Sablefish Pounds Commercial Halibut Pounds Landed —Total Pounds Landed Salmon Source: Alaska Department of Fish and Game Kenai Peninsula Comprehensive Economic Development Strategy Page 10 Appendix 9: Real Estate Indicators for Central Peninsula Central Peninsula Median Home Sales Price $220,000 $210,000 $200,000 $190, 000 $180, 000 $170, 000 $160, 000 $150,000 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Median Price Source: Alaska Multiple Listing Service Central Kenai Peninsula Residential Home Sales 600 160 1 40 500 120 � 400 o 100 i (D V) 2t N 300 80 c: o o = 200 N 60 0 40 100 20 0 0 2006 2007 2008 2009 2010 2011 2012 2013 2014 Axis Title ■� Days on Market Number of Sales Source: Alaska Multiple Listing Service Kenai Peninsula Comprehensive Economic Development Strategy Page 11 Appendix 10: Tourism Industry in Kenai Peninsula Borough Visitor related Gross Sales, 2008-2013 $300,000,000 $250,000,000 $200,000,000 $150,000,000 $100,000,000 $50,000,000 wMMEW Lj j $0 2008 2009 2010 2011 2012 2013 ■ Guiding Land ■ Arts and Entertainment ❑ Guiding Water ❑ Hotel/Motel/Bed & Breakfast ❑ Restaurant/Bar Source: Kenai Peninsula Borough Structure of Tourism and Hospitality Industry by Employment, 2014 NAICS 487 Scenic and sightseeing transportation 6.4 NAICS 72 Accommodation and food services 83.5 Source: Kenai Peninsula Borough NAICS 5615 Travel arrangement and reservation services 0.3% INAICS 71 Arts, entertainment, and recreation 9.8 Kenai Peninsula Comprehensive Economic Development Strategy Page 12 Appendix 11: Visitor related Gross Sales by Place, 2013 vs. 2015 Visitor related Gross Sales by Place, 2013 �7 Outside of Cities 39.3 % Seldovia 0.4% Soldotna 13.6% Homer 17.2% Kenai 9.6% Visitor related Gross Sales by Place, 2015 Homer 16% Other Cities 40% di Soldotna 10% Seldovia 0% Kenai 8% Sewa rd L 26% Kenai Peninsula Comprehensive Economic Development Strategy jr.,I" I., 1C Page 13 Appendix 12: Mining, quarrying, and oil and gas extraction sector 11600 1,500 1,400 1,300 1,200 1,100 1, 000 900 800 Total Mining Sector Employment and Cook Inlet Oil Production, 2002-2014 Million Barrels 0 ® Total Mining Employment 10 8 6 4 2 —C)�Cook Inlet Oil Production, million barrels 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Source: US Census Nonemployer Statistics data, Quarterly Census Employment and Wages, http://dog.dnr.alaska.gov/Rovalty/Production.html 120.00 110.00 100.00 90.00 80.00 70.00 60.00 50.00 40.00 30.00 ANS West Coast Average Oil Spot Price in Dollars, 2004-2014 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Source: http://www.tax.alaska.gov/programs/oil/prevailing/ans.aspx 0 Kenai Peninsula Comprehensive Economic Development Strategy Page 14 Appendix 13: Education Graduation vs. Drop -out Rates in Kenai Peninsula Borough, 2003-2014 Graduation Rate Drop Out Rate 85% 20% 83% -Graduation Rate* wDropout Rate 18% 81 % E 16 79% - - 14% 77% 12% 75 % 10% 73% 8% 71 % 6% 69% 4% 67 % 2 65% 0% O°� '�O '��` 0 ,ti0 Off\ Op\ ,ti0 ,ti0 ,ti0 ,LO OLj\ 00\ Off\ Ocb\ ,ti0 ,ti0 ,ti0 ,ti0 Oo�\ ,y0\ ,y�\ ,y1,\ ,ti0 ,y�\ ,LO ,ti0 ,�O ,ti0 ,ti0 e e 11 ,ti0 rp" ,ti0 Source: State AYP District Reports, http://education.alaska.gov/reportcard/, Alaska State Report Card to the public, http://education.alaska.gov/reportcardtothepublic/ Population 13,000 12,500 12,000 11,500 11,000 10,500 School Age Population vs. Enrollement in Kenai Peninsula Borough School District, 2003-2014 Population age 5-19 years old Enrollment (PK-12) 9,800 O Enrollment (PK-12) 91700 9,600 9,500 3 9,400 9,300 ,u 9,200 AM' VM0 9,100 9,000 Off` O� Oro O'� O� O°� ,y0 `�'� ,y'1. '�'� ,�D� ,LO �O �O �O ,LO ,LO �O ,LO ,LO �O ,LO Source: State AYP District Reports, http://education.alaska.gov/reportcard/, Alaska State Report Card to the public, http://education.alaska.gov/reportcardtothepublic/, Department of Labor and Workforce Development, Research and Analysis Section; and U.S. Census Bureau Kenai Peninsula Comprehensive Economic Development Strategy Page 15 Attendance Rate vs. Enrollement in Kenai Peninsula Borough School District, 2003-2014 Attendance Rate Enrollment (PK-12) 100% 9,800 99% Attendance Rate Enrollment (PK-12) 911700 98% 9, 600 97% 96% ^ 9,500 95 % 9,400 0 94% 9,300 9,200 92% 91% 9,100 90% 9,000 Off` O� 00 O� OOP O°� ,yO '�'� ,y1, '�05 ,yN ,LO ,LO ,LO ,LO ,LO ,LO ,LO ,LO ,LO ,LO ,LO Q� Q� ti T ti T ti T T ti ti ti ti Source: State AYP District Reports, http://education.alaska.gov/reportcard/, Alaska State Report Card to the Public, http://education.alaska.gov/reportcardtothepublic/ Kenai Peninsula Comprehensive Economic Development Strategy'` Page 16 Appendix 14: Cost of Living 5.0 % 4.0% .80% 3.40% 3.20% 3.0% 2.80% 2.0 % 1.0% 0.0% Li Li - I 2005 2006 2007 2008 1.0% Source: Alaska Department of Labor DAnchorage 0 US 3.20% 2.10% .60% 50% 1.60% 2 9 2010 2011 2012 2013 2014 2015 -0.40% -0.10 % Kenai Peninsula Comprehensive Economic Development Strategy Page 17 Appendix 15: Kenai Peninsula Borough Income Per Capita Personal Income in Kenai Peninsula Borough and Alaska on Average, 2003-2013 Kenai Alaska 50,000 55,000 5 451000 0,000 45,000 40,000 40,000 35,000 35,000 30,000 0000 30,000 25,000 25,000 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Kenai Per Capita Personal Income, $ Alaska Per Capita Personal Income, $ Source: Bureau of Economic Analysis Per Capita Personal Income Growth Rate in Alaska and Kenai Peninsula Borough, 2004-2013 12% 10% 8% 6% 4% 2% 0% N 2004 2005 2006 2007 2008 109 2010 2011 2012 2013 -2 ■ Kenai Per Capita Personal Income Growth, $ Alaska Per Capita Personal Income Growth, $ Source: Bureau of Economic Analysis Kenai Peninsula Comprehensive Economic Development Strategy Page 18 Appendix 16: Total Personal Income by Industry Total Personal Income by Industry, 2013 Other governmental entities 2 14,034,489 Federal government 46,810,246 State government 69,995,216 Local government Other services, except public administration 63,836,708 Accommodation and food services 68,5111946 Arts, entertainment, and recreation , 11,014,799 Health care and social assistance Educational services ' 7,107,750 Administrative and waste services ■ 18,531,262 Management of companies and enterprises I 3,456,170 Professional and technical services 74,039,195 Real estate and rental and leasing 50,477,997 Finance and insurance 25,496,028 Information ■ 16,041,286 Transportation and warehousing Retail trade 99,222,263 Wholesale trade N 15,693,263 192.1487,619 Manufacturing 861,4161159 Construction 146.12191810 Utilities 46,673,700 Mining, quarrying, and oil and gas... Agriculture, forestry, fishing and hunting 40,752,348 Source: IMPLAN model for Kenai Peninsula Borough 332,566,856 363,627,264 253,889,787 100,000,000 200,000,000 300,000,000 400,000,000 Kenai Peninsula Comprehensive Economic Development Strategy �f.. Page 19 Share of Total Personal Income vs. Share of Employment, 2013 20.0 % 18.0% 16.0 14.0 % 12.0 10.0 % 0 8.0% 6.0% 4.0% 2.0% 0.0% E 0 Mining, quarrying, and Retail trade Transportation and Health care and social Local government oil and gas extraction warehousing assistance Share of employment, % Share of total personal income, % Source: US Census Bureau 2013, IMPLAN Kenai Peninsula Borough Model Kenai Peninsula Comprehensive Economic Development Strategy �f Page 20 Appendix 17: Household Income in Kenai Peninsula Borough Number of KPB Households by Income, 2013 1000 2000 [c3I 1111111i < $10,000 933 $10,000 to $14,999 11,192 $15,000 to $24,999 21,001 $25,000 to $34,999 1,773 35,000 to $49,999 21P474 $50,000 to $74,999 $75,000 to $99,999 3,149 $100,000 to $149,999 31597 $150,000 to $199,999 11235 >$200,000 or more 802 Source: 2011-2013 American Community Survey, Kenai Peninsula Borough Median Household Income ($), 2013 80,000 70,000 60,000 50,000 40,000 30,000 20,000 101000 United States Alaska Source: 2011-2013 American Community Survey, Kenai Peninsula Borough 011111" 4,262 Kenai Peninsula Borough Kenai Peninsula Comprehensive Economic Development Strategy Page 21 Appendix 18: Government Employment in Kenai Peninsula and Alaska, 2015 First quarter 4,000 3,500 AID 3,000 2,500 2,000 1,500 1,000 500 0 Federal State Loca Source: Based on Quarterly Census of Employment and Wages - http://Iaborstats.alaska.gov/qcew/qcew.htm Kenai Peninsula Comprehensive Economic Development Strategy'` Page 22 45,000 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0 Appendix 19: Sales by Tourism Sector and City, 2013 30,000,000 ■ Arts and Entertainment Guiding Water 25,000,000 Hotel/Motel/Bed & Breakfast Restaurant/Bar 20,000,000 15/000/000 10,000,000 5/000/000 Soldotna Homer Kenai Seward Source: KPB Finance Department Kenai Peninsula Comprehensive Economic Development Strategy Page 23 Seldovia E _KF-4iI "AF-14LINA 14AP.+fl}R.Nl� 11 h1�1 L114ll Tlf olsr■I Appendix 20: Number of Crimes per 100 People by Borough/Census Area Number of Crimes per 100 people Matanuska-Susitna Borough 0.99 Prince of Wales-Hyder Census Area 1.14 Kenai Peninsula Borough 1.91 Valdez -Cordova Census Area 2.01 Aleutians West Census Area 2.01 Skagway Municipality 2.04 Haines Borough 2.13 Fairbanks North Star Borough 2.13 Bethel Census Area 2.32 Nome Census Area 2.69 Dillingham Census Area 2.82 Ketchikan Gateway Borough 2.95 Bristol Bay Borough 3.08 Petersburg Borough 3.12 Sitka City and Borough 3.15 Kodiak Island Borough 3.41 North Slope Borough 3.76 Juneau City and Borough Northwest Arctic Borough Anchorage, Municipality of Source: http://www.dps.alaska.gov/statewide/docs/UCR/UCR_2014.pdf 4.81 5.45 6.13 Kenai Peninsula Comprehensive Economic Development Strategy Page 24 Appendix: Community Survey Results 1 In your opinion, what is the current economic status of the Kenai 61 responses) Ve ry P rOS De ro.. s Somewhat. prosperous. Average Less than PrOS Pero us 0 eQ-k 2) Haw optimistic do you feel about the economic future of the Kenai Peninsula? {61 responses) 0 Very optirristc 40 S o rnewhcat 0 DIL Mi Sti C Neutral Not. opt n, i sti c Pessimistic Kenai Peninsula Comprehensive Economic Development Strategy � Page 1 3) Which of these growing industrIes do you feel has the most growth potential? 66 respon-ses) EdUCatioral services Fi nG- n ci,-r_l services :vices and insurance Hea Ithcare 40 1 nfo rm ation Management of CoMparies and e r, kerp rises Professional a nc tec nn ical services 0 Real estate, rent@ a i d leasing Tray i sp or < . c)r7 and wa re nn us inn 4 How do you feel about the current workforce availability? (61 responses). e have more available workforce than we need. e Nave a sufficient available workforce. We do noL have a suffi Gient available workforce. e a re fa r from hav in g a suffl Gient available workforce. Kenai Peninsula Comprehensive Economic Development Strategy Page 2 5) In your opinion, how adequately trained anti prepared is the current available workforce? Very pro Dareo S o rnewhaL p repa red NOL adequately prepared Far from prepared 6) Wh at i s the q ua lit y of I 2 educati on o n the Ken a i Pen insu la ?,. (56 responses', 0 Ve ry h igh q ual ity So mewhat. h .gig h q L�al its{ Average S o mewhat low q ual ity Very low quality Kenai Peninsula Comprehensive Economic Development Strategy Page 3 7) What is the quality of post -secondary d U ation on the Kenai Peninsula? Very high quality SomffwhaL high quality Average S o mffwhaL low q ual ity Very low quality 1 +1 If you left the Kenai Peninsula, where would you most I Ikely move? 161 respon-ses) Anchorage or the Matsu area Fairbanks area Juneau area S n ras hers i n Alaska othe r tha n the hut) areas listed above Outside of Alaska Outside of the United States Kenai Peninsula Comprehensive Economic Development Strategy Page 4 A Special Thanks to our Funding Partners ALASKA D F PART M F N T O F COMMERCE, COMMUNITY, AND ECONOMIC DEVELOPMENT United States Department of Commerce, Economic Development Administration Contact KPEDD 14896 Kenai Spur Hwy, Suite 103A Kenai, AK 99611 907-283-3335 www.kpedd.org