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A $64 million runway for no one in Alaska?
Remember Alaska's "Bridge to Nowhere," a $400 million span that was supposed to connect Ketchikan to its airport on sparsely inhabited Gravina Island? The project gained infamy in 2005 as a waste of taxpayer dollars and the funds earmarked for it were withheld. The 8,000 residents of Ketchikan continue to be connected to their airport by ferry.
Fast forward six years and another remote Alaskan airport project is raising questions about how the government spends money.
The price this time is $77 million and the place is Akutan, a remote island village in the Aleutian chain, according to a report from the Alaska Dispatch.
By next winter Akutan is scheduled to have a 4,500-foot-long runway, built at a cost of $64 million ($59 million in federal and $5 million state funds), the Dispatch reports. The problem is, the runway is on Akun Island, 6 miles from the village across the treacherous waters of the Bering Sea. Plying those waters can be tricky with seas over 6 feet and winds above 30 mph.
Original plans called for using a hovercraft - at a cost of $11 million - to ferry passengers from Akutan to Akun. But, the Dispatch points out, the same model hovercraft planned for the route has proven unreliable under similar conditions elsewhere in Alaska. And when it did run, operating losses were in the millions.
Now, transportation officials are considering using a helicopter to ferry passengers from Akutan, according to the Dispatch report. Cost of that is still being determined.
Should officials get it all figured out and funded, who'll benefit? Akutan has a year-round population of 100, but that spikes to about 1,000 in the summer when Trident Seafoods processing plant, the largest seafood processing plant in North America, is in operation, the Dispatch reports. Trident is contributing $1 million to the project, the Dispatch says.
And why is this necessary? Air service to Akutan is now provided by World War II-era amphibious aircraft operated by Peninsula Airways. Those are becoming increasingly difficult to maintain, Peninsula Vice President Brian Carricaburu told the Dispatch.
Carricaburu also says the runway could cut the government's costs in one way. Peninsula Airways routes to Akutan are now subsidized by about $700,000 annually under the federal Essential Air Service program. Using bigger, more efficient aircraft could bring that cost down, he told the Dispatch.
But to reach that point, it looks like a lot of figurative bridges have to be crossed.
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opposed.
It sounds like it would make more sense to build new planes that will work with the existing infrastructure (or lack thereof). Wouldn't that cost less? Then, building those planes would maybe create new jobs.
You're welcome! I have great ideas sometimes.
There is one benefit to the new runway – another place to land in an emergency in a fairly remote area.
The 2007 gross state product was $44.9 billion, 45th in the nation. Its per capita personal income for 2007 was $40,042, ranking 15th in the nation. The oil and gas industry dominates the Alaskan economy, with more than 80% of the state's revenues derived from petroleum extraction.
Most food in Alaska is transported into the state from "Outside", and shipping costs make food in the cities relatively expensive. In rural areas, subsistence hunting and gathering is an essential activity because imported food is prohibitively expensive. The cost of importing food to villages begins at 7¢ per pound (15¢/kg) and rises rapidly to 50¢ per pound ($1.10/kg) or more. The cost of delivering a 1 US gallon (3.8 L) of milk is about $3.50 in many villages where per capita income can be $20,000 or less. *****Fuel cost can exceed $8.00 per gallon.***** (meaning its expensive to transport goods to and from the area hence the need for a commercial grade airport)
possibly they need to limit the percentage the feds can subsidive on a project like this.. Like in order to get federal money, you have to demonstrate 50 to 75 percent of the necessary funds and the matching funds cannot exceed 30% or something of that nature.. Requiring the businesses to come off the money and invest in the communities.. ..
Just give the 100 people $200,000 each to move out of there and it costs only $20 mil once!
At $77 mil, that is $770,000 for each person.... plus upkeep and maintenance then they will need some FAA people there as well.....
NUTS!
I like this idea, too.
Good ole self-reliant Republican Alaska! Standing on their own two feet!
65 million / 1,000 jobs = $65,000 per job. Spread out across 15 years = $4,333 per employee per year.
If you think of this from a jobs standpoint, subsidized by the government, the 15 year benefit to each employee is probably a bit larger than the per year cost over that time. If the individuals are at risk of losing their jobs due to maintenance of outdated equipment, from an economic investment standpoint, this may be worth it – they'll probably end up paying more in taxes back to the government by keeping those jobs.
Building it on the wrong island, however, doesn't sound like a good idea. But CNN didn't give us their reasoning for 'why' they chose that island – just that they did.
Thats an inital investment it makes no qualifcation of the funds necessary to maintain the facility after its built..
You're absolutely right. We're missing quite a bit in this story for us to pass full judgement on the project, now aren't we?
It looks like they're building it on the only fairly flat area in that area.
Jldub, then that does make sense. It's tough for us (including me) to pass full judgement when this article still requires astute observers like you to go out and find the pieces of the puzzle.
I'm curious about the full report – who's involved, what was at stake for the state of Alaska, how Alaskans prove to benefit (including those employed at this plant) how the plant benefits, and what the plant will be doing aside from the $1million dollar investment to give back to Alaskans.
Who did the cost benefit analysis of spending $64 million for this project? This is another Alaskan boondoggle and waste of taxpayer money.
Ya, like the lower 48 has no issues... no wasteful spending.. ya...
This is a stretch of the "drive until you qualify" suburban cycle. People drive 45 minutes, an hour, 75 minutes to work. There are windswept rocks up there in Alaska that someone would live on if you provided them ferry or air service. If they want to live there or a company wants a fish packing plant there – let them build the infrastructure. The return on investment is insane at a million dollars per resident.
It is time to sharply reduce scarce federal money going into runway extensions and for other airport projects at small airports like this. Cities and towns wanting this sort of thing need to step up with their own money, raising property taxes if necessary, if they really have to have it. The special committee reviewing for budget cuts, please take note!!
"Air service to Akutan is now provided by World War II-era amphibious aircraft operated by Peninsula Airways. Those are becoming increasing difficult to maintain..." Uuuhhhh... wouldn't it be cheaper to just build new planes? Even if this runway/ferry system is the only viable option; what about the cost split? Why is Trident Seafoods pitching in only $1M when the project is primarily for it's benefit? The secondary beneficiary is the state of Alaska; land of the midnight sun... and the Permanent Fund Dividend. Why is it only kicking in $5M?
$77M is A LOT of money to shell out for a year's worth of construction jobs!
Something stinks here; moreso than an old pair of cannery boots. It is, indeed "shovel ready"...
Uncle Sam, CURB YOUR DOG!
Exactly.
Who wrote the bill (or earmark) that authorized this – and why are not we calling them out? Do they get campaign contributions from Trident? And it so, how much? Your country , for sale.
Longer Runways = bigger planes
Simple.
bigger planes = fewer trips = corporate transportation budget savings
So we're spending $77 million to reduce a $700K annual cost. $77 million could pay the annual cost for 110 years. Let's just stick with the $700K
amen.
Say it isn't so... I wonder who's idea this was? I bet $64 million dollars that it was the same party that wants to cut down spending... and is against using the American taxpayers money for unnecessary things... If the people in Alaska and the Island want a bridge tell them to have a fundraiser because ........this is a want not a need... NEXT
An airport is a business asset, my friends. You have to evaluate its value to the company and employees it serves, and part of that involves depreciating its value as an expense over time.
Look at the over time depreciated value of the investment and you'll see that it's not quite as absurd as the media likes to bill it.
to the company.. and thats who should pay for it.. The state can buy it from them later..
You may be right. In this case, however, the financiers may have made a valuation that shows the state of alaska losing if the plant shuts down and benefitting by keeping those jobs.
The issue is that we don't have that report in this article. We have the part of the story that generates the biggest negative reaction.