Alaska: Alaska's Housing Market: The First Half of 2015 - There’s heightened interest in some of the state’s broad economic measures recently as a result of low oil prices and state budget challenges. Through the first half of 2015, Alaska housing prices and other housing market indicators showed no major signs of weakness according to Juneau-based ‎Economist Karinne Wiebold.

In the December 2015 edition of Alaska Economic Trends, Wiebold reports the average sales price for a single-family home in Alaska increased 4 percent from the first half of 2014. But despite higher prices, housing affordability improved over that period. Statewide wages rose 3.5 percent, outpacing a 1.1 percent increase in inflation, and the average mortgage interest rate dropped a little over half a percentage point.

For more than two decades, the Alaska Department of Labor and Workforce Development’s Research and Analysis Section has worked with the Alaska Housing Finance Corporation to collect and analyze Alaska’s housing statistics, including residential loans, new construction, foreclosures, interest rates, and affordability.

What follows is a summary of the department's most recent findings. - More...
Wednesday AM - December 09, 2015

Alaska: Alaska Faces Lower Oil Revenue with Lower Oil Price in Fall 2015 Forecast - Alaska Department of Revenue Commissioner Randall Hoffbeck released the Fall 2015 revenue forecast Tuesday. This annual forecast provides basic information about state revenue, as well as a forecast of state revenue over the next 10 years.

“The reality of our current fiscal condition is that total state revenues have dropped more than 50% from fiscal year 2014, and, of that total, general fund unrestricted revenues have declined nearly 60%,” Hoffbeck said.

Total state revenue was $8.5 billion in fiscal year 2015 from all sources. Of that total, general fund unrestricted revenue (GFUR) totaled $2.3 billion with oil and gas revenues accounting for approximately 75% of all unrestricted revenue. Unrestricted revenues have also collapsed by over 50%. For comparison, in FY 2014, total state revenues were $17.2 billion and general fund unrestricted revenue totaled $5.4 billion. The Department of Revenue forecasts total revenue as $9.5 billion in FY 2016 and $10.3 billion in FY 2017.

Overall oil production has declined by about 5% in the last year. “While there was a 13.6% increase in production in the Cook Inlet, that was not sufficient to offset a 5.6% decrease on the North Slope,” Hoffbeck said. “We are forecasting North Slope annual production to remain above 500 thousand barrels per day until 2018.”

The Fall 2015 revenue forecast is based on an annual average Alaska North Slope oil price of $49.58 per barrel for fiscal year 2016 and $56.24 per barrel for fiscal year 2017. “Beyond that, we project that annual average prices will slowly increase to more than the $80-per-barrel nominal price within the 10-year-forecast period, based on the analysis of the structure of oil markets,” Hoffbeck said.

This year’s forecast introduces a new presentation of revenue available for current-year appropriation, in the Executive Summary of the Revenue Sources Book. Revenues available for current-year appropriation include, in addition to unrestricted and designated General Fund revenues, realized earnings of the Alaska Permanent Fund accounted for in the Earnings Reserve, earnings of the Constitutional Budget Reserve Fund, and other deposits. - More...
Wednesday AM - December 09, 2015

Alaska: President Signs Long-Term Highway Bill: Alaska stands to receive more than $2.6 billion - The legislation providing funding for our nation’s surface transportation needs over the next five years, from highways to ferries and railroads was signed by President Obama on December 04, 2015 becoming Public Law #114-94.

Known as the Fixing America’s Surface Transportation (FAST) Act, FAST will provide annual increases in funding over a five year period which means that Alaska stands to receive more than $2.6 billion from Fiscal Years (FY) 2016-2020. This amounts to $281 million or 10.6% increase above current levels.

U.S. Senator Lisa Murkowski (R-AK) was a member of the surface transportation conference committee and able to negotiate the differences between both the House of Representatives and the U.S. Senate versions of the bill. Through this leadership position, Murkowski was able to give Alaska’s interests and priorities a voice at the negotiating table, and help retain provisions secured by Senator Dan Sullivan (R-AK) as a member of both the Environment and Public Works Committee and Commerce Committee, and Congressman Don Young (R-AK) as a member of the House Transportation and Infrastructure Committee.

“Alaska has unique transportation needs and challenges—whether it be due to our state’s vast size, remoteness, difficult terrain, or harsh climate. Because of this, it’s imperative that we have the certainty that comes with a long-term transportation funding bill,” said Murkowski. “We all recognize that Alaska is in the midst of budget crisis, so being able to rely on federal funding for critical infrastructure projects, whether it be on roads, bridges, or ferries, is key to our state. I’m proud that with the FAST Act, we have a five year bill with stable funding - the longest time period for transportation funding that Congress has secured in seventeen years.”

“Passage of a long-term highway bill will provide Alaskans with much-needed certainty in infrastructure investments throughout our state,” Senator Sullivan said.

Sullivan said, “Building off Congressman Young’s work as a past chairman of the House Transportation and Infrastructure Committee, and Senator Murkowski’s position on the Surface Transportation Conference Committee, combined with my position on both the Environment and Public Works and Commerce Committees, we were able to secure a number of Alaska-specific provisions that will increase transportation funding for core highway programs, tribal transportation and the ferry system that are so vital to Alaska’s economic future. The bill also includes reforms to our permitting system, which will help cut through project-killing red tape and streamline regulatory burdens. This bill amounts to a big win for Alaska as it will allow us to not only address our infrastructure needs but also promote and sustain economic growth throughout the state.”

The FAST Act contains numerous Alaska-focused provisions championed by the Alaska delegation. Alaska-specific provisions included in the five year transportation bill: - More...
Wednesday AM - December 09, 2015

Alaska: VA Misses Mid-November Deadlines to Improve Veterans Healthcare in Alaska - At a Senate Veterans’ Affairs Committee hearing last Wednesday, U.S. Senator Dan Sullivan (R-AK) changed his tone and lambasted the Deputy Secretary and the Undersecretary for Health of the Department of Veterans Affairs on the lack of progress on the Alaska Pilot Program for the Veterans Choice Program. After conducting a field hearing and a series of listening sessions throughout Alaska in August – held at the request of Senator Sullivan – the VA announced the pilot program would be fully implemented by mid-November 2015 to help fix the problems Alaska veterans were having with the Choice program.

But since the August announcement, the agreed-upon deadlines for the Alaska Pilot Program have not been met and veterans continue to complain about the implementation of Veterans Choice Program in Alaska.

“When are you going to fix the problem in Alaska like you committed to when you were there in August?” Senator Sullivan asked VA Undersecretary Dr. Shulkin. “On behalf on my veterans I'm pissed…By mid-November, it was all going to be done. It's not done.”

Senator Sullivan continued, “[The VA is] asking for $13-14 billion [from Congress] to fix the Choice Act and can't even fix it in my state where you know it is a freaking disaster… It is a nightmare.”

During the hearing, the VA admitted that they had not met their mid-November deadline, despite agreeing to implement the second and final phase of Alaska’s Pilot Program by that time. According to the VA, no staff has been hired and they have yet to even create job descriptions. - More...
Wednesday AM - December 09, 2015