GOVERNOR DUNLEAVY’S FY2022 BUDGET CALLS FOR THREE MAIN ELEMENTS TO BE IMPLEMENTED
The FY2022 budget created in December is making its way through the 2021 legislative session. It calls for stabilizing Alaska’s economy, passing an infrastructure project bond, and building “fiscal certainty” for Alaskans. It contains a long list of goals, including funding the rest of the 2020 permanent fund dividend—an additional $1,916 for every Alaskan, funding $4 million to address sexual assault case backlogs, $26 million to fisheries, wildlife, and resource projects. It also funds $24 million in construction and maintenance projects, and $4million for statehood defense.
The infrastructure project Bond calls for up to $350 million for putting Alaskans to work building bridges, ports/harbors and roads across the state. Local legislators are concerned that the allocation for northern southeast community projects will shortchange any sort of recovery of our economy.
The budget aims to create fiscal certainty for Alaskans by proposing a full PFD for FY22, proposing a new dividend formula going forward. It also proposes constitutional Amendments to cap government spending, require a vote of the people to pass new taxes and to constitutionally protect the permanent fund and the Dividend.
Viewed as almost a certainty on the horizon, Dunleavy pledges to get voter approval of any proposals for new taxes on Alaskans.
JUNEAU LEADERS AND BUSINESS OWNERS GRAPPLE WITH CANADIAN FREEZE ON 2021 CRUISE SEASON
The decision in early February of the Canadian minister of transport to prohibit cruise ships for plying Alaskan waters will require business and community leaders to respond in a coordinated fashion. Because the Canadian restrictions will, in effect freeze the tourism business in Southeast for a second consecutive season, the impact on Juneau will hurt not only business, but the CBJ budget as well. In the coming weeks, there will be a concerted effort to seek either a temporary waiver of the Jones Act, which prohibits foreign “bottoms” to operate freely in Southeast Alaska or—to secure a negotiated agreement with the Canadian Government to allow for reduced traffic versus a total cruise industry shutdown until 2022.
INVENTORY OF RESIDENTIAL PROPERTIES IN JUNEAU DROPS TO HISTORICALLY LOW LEVELS.
With a continued trend of low interest rates as the primary factor, the number of available residential properties for sale in Juneau has reached an all-time low, according to local residential brokers. This further complicates the quest by municipal officials and developers to provide more affordable housing, because now the supply of nearly all types of housing stock has almost completely dried up. This continues the decades-long shortage of housing in Juneau (with the exception of the mid-eighties recession) which has been caused by a the lack of buildable land, and the high costs of shipping construction materials to Juneau and high local labor costs. With nearly 100 local licensed residential agents, it will be difficult for them to sustain current sales levels with inventories so low.