As a lifelong Alaskan, mother of two small children, small business owner and as someone whose day job consists of promoting business growth in Southeast Alaska, I watched with dismay earlier this month when the Alaska Senate rejected legislation to generate new revenue to support our state.
This is not complicated: our schools are laying off teachers and seeing increased class sizes and reduced resources, the Alaska State Troopers workforce is shrinking, and our capital budget, which supports important infrastructure and construction projects, is practically at zero. While it is positive that both the Alaska House and Senate are in favor of using Permanent Fund earnings to support state services while making the dividend more sustainable, a comprehensive fiscal solution that gives me, my business and my children a hopeful future in our state is impossible without new revenue. This isn’t about keeping the government open, it’s about keeping Alaska open for business.
My husband and I own a small cafe in my hometown of Sitka and employ 10 people. I also work at Spruce Root, Inc., a nonprofit community development financial institution that provides technical resources, business planning, one-on-one assistance, and other training to support and grow a sustainable economy for our region. Spruce Root deploys capital in the form of loans to support expanding businesses and entrepreneurship in Southeast Alaska. Our loans help businesses with startup capital, leaseholder improvements, business expansion and working capital.
But we can’t do it alone. The state has an essential role to play in keeping our state healthy and thriving, particularly with core services such as public education, public safety and infrastructure. As a small business owner, I see every day how our future is inextricably connected to innovation and entrepreneurship. We should support innovation by the peoples that are here already, and we need to attract skilled, innovative entrepreneurs to relocate to and create wealth in Alaska. But who would want to move here when the Legislature is bleeding our school system and savings accounts dry?
Businesses have made this very clear: We can’t attract and retain a top-notch workforce if we don’t have an outstanding public education system. We are competing with all the other communities in America that have strong public schools, many of which have specialized programs in science, technology, engineering, math and languages. Highly-skilled workers and entrepreneurs have their choice of where to live. They will not move to states with low-quality education systems for their children, regardless of how low taxes might be. As I am acutely aware of with two young daughters, strong public schools are a cornerstone of economic development. Furthermore, when considering economic growth, having a strong and diverse mix of industries in the state is much more likely to create significant long-term benefits for all Alaskans than keeping the state at zero income tax. Creating new revenue through non-regressive measures such as a modest income tax will allow Alaska to be more self-sufficient, provide stability for and increase access to core state services and continue to grow our economy. Simply spending down our savings and not looking toward new revenue will have the opposite effect and slow the economy, offsetting any benefit of boasting a zero income tax.
Unfortunately, further deep cuts to our education system are inevitable without new revenue. There have already been hundreds of layoffs in our school districts over the last three years of cuts, and those layoffs will only get worse now that the state has significantly reduced its savings accounts.
It is time for the Alaska Senate to do its job and protect Alaska’s economic future. We need new revenue now, as part of a comprehensive fiscal plan. Without it, our public education (not to mention public safety and infrastructure) will be gutted.
I’m in the business of expanding our Southeast Alaska and statewide economy, and the Legislature needs to do its part rather than undermining the foundations of our prosperity.
• Alana Peterson is Tlingit of the Luknaxadi clan. She grew up and currently lives in Sitka. Alana works in economic development in her current role as Program Director of Spruce Root, Inc.
