Wasilla is strategically centered in the geographic growth area of Alaska, the thriving medical complex development, macroeconomic projects, airport expansion, population growth and even continued growth in the student enrollment of the local school district.
The greatest private sector economic expansion of our community is in the area of the Seward–Meridian, major private sector medical developments. Over a year ago a $12 million day surgery center was completed with the help of Alaska’s industrial development authority. Another multi-million dollar medical facility, skilled nursing home and other professional private sector buildings and services continue to be developed.
National and local retail expansion at the Sun Mountain Center is unprecedented in the fastest growing city in Alaska.
There continues to be industrial and airport related commercial development at the Wasilla Airport. The City continues to work toward its airport expansion as an economic development engine for the Valley, as it is located in the center of the demographic target of the Mat-Su. The Wasilla Airport now is surrounded by new road access – excellent infrastructure expansion by the government. Hopefully, the private sector will continue to invest in the surrounding location to bolster the tax base for the Mat-Su Borough.
The growth of the Mat-Su Borough is proof of the most desirable place to reside in Alaska. The greater Wasilla and borough wide community in Alaska is one of the only bright spots for continued growth – population and economic development. The community grew by approximately one and one-half percent in 2018, while most of Alaska is losing population and jobs because of a three year recession brought by the lower price of oil, which is in a current state of recovery, and governmental regulation.
Governor Michael J. Dunleavy recently stated, “private investment is up, GDP is up, personal income is up, and unemployment is down – these all point to an improving economy.”
According to the Alaska Department of Labor and Workforce Development, job growth in September jumped 0.6 percent, or about 2,000 jobs.
Positive Elements of the Alaskan Economy
The Alaskan recession has ended. Several huge positive elements are on the horizon, starting with the Alaska Permanent Fund Corporation.
The APF is significant and unique to Alaska. The fund has current value of approximately $65 billion available to provide dividends to all Alaskan residents and possibly help fund the huge state government. The current value of the APF is at https://apfc.org/our-performance/ and more information about the APF is at https://apfc.org/home/Content/home/index.cfm APF obtains it increase in assets from both more oil royalty/tax payments and earnings from a very diversified investment portfolio.
• Oil – All other economic endeavors are shadowed by the State’s most important industry. There is nothing but positive oil production increases on Alaska’s North Slope. Thousands of barrels more a day of North Slope crude are slated to begin production in the next year. Moreover the US government has determined that there are 8.7 billion barrels of oil for recovery in the National Petroleum Reserve and Alaska has even more natural gas.
• The hydrocarbon rich area of 10-02 next to the Arctic National Wildlife Refuge (ANWR) is now available for oil exploration. The Alaskan Congressional delegation were finally successful in convincing Congress to allow development in this very specific area. This will open more oil drilling and other energy development, lifting a 40 year ban on development in the area.
• Alaska’s strategic military location continues to be touted by both political powers. The President of the United States has made several recent stops in Alaska during trips to the Far East for economic development and peace. The recent nuclear weapon threats from North Korea have doubled the construction of interceptor missiles in Alaska, per the newly approved defense budget. The Vice President was just in our state and reemphasized the importance of the military in Alaska for the United States. Accordingly, the Alaska defense location on the globe is strategic to all of North America – its “top cover.” The missile locations are a couple hundred miles to the north of the Mat-Su Area, but many of the workers, both military and contractor families, live in our community. The military presence in Alaska will continue to remain, and grow, as a strategic asset to the Nation. Alaska’s congressional delegation continues to promote the importance of military expansion and investment in the Greatland.
• LNG – A $45 billion pipeline project to carry liquid natural gas from the North Slope to tidewater in Southcentral Alaska. The proposed project could be completed in 10 years using primarily foreign investment. Please see the following link, if you wish more information: https://alaska-lng.com The federal government has asked that the Port McKenzie of MSB be reassessed for a possible terminus of the megaproject. If the LNG plant is built on the shores of the Arctic Ocean, in my opinion, most of the workers will choose to reside in our Valley communities.
• Housing costs from inexpensive real estate – The Mat-Su continues to grow because of three paramount reasons. The cost of an average single family home is approximately $100,000 less than the “big sister city” of Anchorage. The Mat-Su Borough School District (MSBSD) remains the very best in the State (growth discussed further below). Finally, the vast space of the MSB allows for family freedoms (elbow room) not experienced in the city. Please see the entire Alaska Economic Trends issue: http://labor.alaska.gov/trends/sep17.pdf
• Young population - Alaska still has a young median age. Specifically, per the U.S. Census approximately 25% of the MSB population is 17 or younger.
• Millions of dollars are being invested in a huge new retail project that has attracted several national firms. The Sun Mountain shopping development is adding significant funds for the City of Wasilla sales tax receipts. Also, the City just completed another $2 million to the Wasilla Airport improvements.
• The greater Wasilla area has a currently population approximately 59,000, per the U. S. Census estimation. Other area communities have estimated populations of: Eagle River (26,000), greater Palmer area (27,000), Knik-Fairview (19,000), Valdez (4,000), Fairbanks (100,000), Kenai Peninsula (58,000), and Anchorage (299,000).
Growth in the Local Area
More specifically, over the past 8 years, the population of the MSB has grown by 18%. The current population is 105,000 (growing by 1.5% per annum).
• The median household income is approximately $77,000. About 36% of the households in the community have annual incomes greater than $100,000.
• The Mat-Su Borough School District (MSBSD) student enrollment continues to grow. With almost 19,000 students, the District is the second largest in the State. The last four years the District has grown by 1.6%, 4.0%, 1.9% and 1.5%, respectively. The growth in the District is consistent with the growth in the population within the MSB. Many families also provide home school or church school options.
The major employers of the community are: MSBSD, Mat-Su Regional Medical Center, Matanuska Electric, Princess Hotels, Red Dog Mine, North Slope and Cook Inlet oil companies, and local government, etc. Detail information of the local employers is now restricted by the federal government, per Mr. Neal Fried, economist with the State of Alaska. So additional, and current specific employer information is regrettably, not available.
Approximately one quarter of the community’s workforce is employed on the North Slope oil production, Red Dog Mine (world’s 2nd largest zinc mine) in the Arctic Circle, commercial fishing and other very high paying jobs outside of Wasilla.
There is a degree of continued optimism for the economy of the Greater Wasilla community.
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Dan F. Kennedy, CPA MBA, has been active in the Alaska business community for decades. His own real estate investment portfolio can be viewed online at: www.mtnvillagealaska.com
