If you had been in Juneau this past week, mixed in with the bustle of committee hearings and the chatter of visitors streaming off the first cruise ship of the summer season, you might have heard something else: Lawmakers trying to tamp down expectations for funds to repair and upgrade the Port of Alaska.
Meanwhile, ebullience about a big election-year Permanent Fund dividend check is high. The PFD might tip the scales at $2,600, if the most recent numbers in the Alaska Senate hold up. On the House side, the PFD check amount passed in the operating budget was lower, at $1,250, but it was paired with a $1,300 “energy rebate” that would be a de facto PFD supplement. That would make the total allocation for the two checks roughly $1.7 billion — nearly three times the amount being sought for the port. The “energy rebate” on its own would cost about $875 million, 50% more than the port improvements.
It’s always more fun to hand out candy than vegetables, particularly when it might make the recipients more favorably inclined to reelect you. But have our elected representatives considered that rather than a one-time cash payout, it might be better for Alaska’s future to invest in infrastructure that will serve all Alaskans for generations to come?
Anchorage officials are seeking $600 million for the Port of Alaska, to replace the aging cargo docks that see goods bound for 90% of Alaska — fully half of all freight that enters our state. Granted, that’s no small ask. As recently as a year ago, the prospect of a $600 million infrastructure project funded by the state would have gotten you laughed out of the Capitol Building. But oil prices in excess of $100 per barrel have forecasts for state revenue in a place where such a project is not only possible, it makes more sense than some of the state’s other big spending priorities.
Still, lawmakers who can see the political writing on the wall are trying to downplay the potential for the port to get the funding it needs — or even a substantial fraction of it. They ask:
• What if oil prices go back down and leave us with a fiscal shortfall again? It’s a fair question, and the oil price fairy won’t bless us forever. However, given that inevitability, why not put our current excess into a project that will reap cost savings across the board on consumer and commercial goods statewide for decades instead of a one-off mega-PFD?
• What if we could get some federal money for the port with grants funded by the infrastructure bill? There are a lot of ifs involved with the potential for federal port funding. The Port of Alaska might indeed qualify for some money, but none is set aside specifically for it, and it would have to compete for small grants with other similar infrastructure needs. Also, the full scope of the port project is north of $1 billion, so it may well be that limited federal funds will still be needed to complete it regardless. This question is the political equivalent of one parent telling a child to ask the other for their allowance — less a serious solution than a plea to be left alone.
• If we allocate this money for the port, what can we tell other regions that demand similar spending in their areas? This one is simple: More so than probably any other infrastructure project in the state, money spent improving the Port of Alaska directly benefits residents statewide through cheaper freight. The vast majority of retail goods and grocery items come in via barge, and most of them come right across Anchorage’s cargo docks. State funding means fees for that freight are lower. Lower fees mean retail costs are lower. And retail cost savings add up, in time, to more value than a big one-time PFD. If you plan to live in Alaska for more than the next six months, opting to fix the port instead of handing out free money makes far more sense. There are other worthy projects both in Anchorage and elsewhere, but none have nearly the reach that the port does.
It’s human nature — especially in an election year, sadly — to prioritize short-term rewards. It seems that the fiscal discipline to make a long-term decision is in short supply in our capital these days. But our lawmakers should remember: We sent them to Juneau to do the responsible thing, and that means prioritizing funding the Port of Alaska over a supersized PFD.