Alaska mining provides huge revenues back to the state
A study by University of Alaska re- searchers documents who-pays-what among the state’s natural resource in- dustries. The report compares revenues paid to state and local governments against costs imposed on the state. Of three industries considered, min- ing comes out on top in terms of net financial contribution, followed by tourism. Oil and gas is by far the larg- est contributor to the state treasury, the study showed, but the principal focus was on mining, fisheries, and tourism. Bob Loeffler and Steve Colt of the University of Alaska’s Institute of Social and Economic Research did the study, which was released Feb. 24. A similar report was done in 2015. The new re- port updates it with average revenues and expenditures for state Fiscal Years 2016-2019. The conclusions in 2022 are similar to 2015, although the numbers are different. Tourism is included as a “resource”
industry because it relies on the state’s natural beauty and its wildlife to attract visitors and brings in money from out- side the state, as do fisheries, mining, oil, and gas. Mining pays the state far more than it costs for agencies to regulate the in- dustry and when minerals taxes to mu- nicipalities are included miners are far in the black in the benefit/cost com - parison. Average annual state revenue for FY 2016-2019 was $66.6 million per year; average expenses (for agen- cy management) was $6.5 million per year, for a net (for stage government) of $59.9 million per year. When average taxes paid to local governments are included ($36.8 mil- lion per year) the equation is positive by $96.7 million. Tourism, like mining, pays far more to the state in taxes than the indus- try costs even including capital costs to support visitors. When revenues to
municipalities are included the bene- fits over cost are even more substan - tial. Average annual state revenues at- tributed to tourism for FY 2016-2019 was $66 million per year; average ex- penses (for state-funded marketing) were $19.9 million per year, for a net positive (for stage government) of $41.1 million per year. However, when aver- age taxes paid to local governments are included ($101.8 million per year) the equation goes positive by $81.8 million. Commercial fishing costs the state a bit more ($8.3 million) than state tax- es paid, but when municipal revenues paid by fishing are included things go positive. Average annual state revenue for FY 2016-2019 was $64.4 million per year; average expenses (for fisher - ies management) was 70.9 million per year, for a net deficit (for stage govern - ment) of $8.3 million per year.
— Tim Bradner
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The Alaska Miner
Spring 2022
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