Alaska's Housing Shortage: The Factors That Cause It & The Levers We Control - 8/27/26

So now, today's format. We have 6 presenters, as you can see behind me, and each of them has been given 10 minutes to talk about a topic related to the housing situation. And Ross is going to hold them to it. I don't have a gavel, but he's got a look, and I've been told that it's very compelling when it's time to stop talking. I'll give each speaker a fuller introduction in just a second, but here's the batting order.

Daniel Delfino, Griffin Forrester, Bob Dole, Mark Foster, Tyler Robinson, and Sean Debenham. We have both a Forester and a Foster on the same panel, so I'm trying not to get those two mixed up. Hopefully, I'll get that sorted. After the presentations, we're going to open it up for Q&A after all the presentations are done, so not one after the other. So wait until the end, and we'll be able to ask questions live to each of the presenters.

And then two thank-yous before we begin. First is for our forum sponsor, Cook Inlet Housing Authority, whose support makes this affordable and open to everyone in this room. And then second, to the Alaska Housing Finance Corporation for this delightful boardroom that we're all in. This is a wonderful space and we really appreciate them letting us have it. All right, that's enough for me.

I think I've made it through my speech. So first up, we're going to welcome Daniel Delfino. Our first presenter sees Alaska's housing market from the 30,000-foot level, which is fitting because his agency touches nearly every corner of it. Daniel Delfino is Director of Planning and Program Development at the Housing— Alaska Housing Finance Corporation, where he's worked since 2008. His department manages statewide rental development, homeownership, and supportive housing programs.

And it produces research and market analysis reports. Please help me welcome Daniel Delfino.

Does this one work? That's all right. I can use this one.

Yay, technology works. All right, well, thank you, everyone. And don't worry, I set the timer. It's in my pocket. If you hear a dog barking, it means I've I've spoken for too long.

John said it is not my corporation. I'm one of the many, many people who work here. Alaska Housing, we do quite a bit of stuff. And I'm prefacing what I'm about to show you with that to explain why we have all this information. We offer mortgages.

We offer construction rebates for new home construction. We have a public housing division. And then we have the group that I work in, which manages about 20 different programs that operate in various housing spaces across the state. And to make sure the people who appropriate this money to us have good answers when they're asking us what we're doing with it, we try and make sure that we understand what's going on in the state so we can actually serve or respond to the things that aren't already happening and that we're not making things inadvertently worse by doing something that is competing with what people are already trying to do to help the economy. So when we talk about housing, we tend to frame it in terms of 3 different things.

It can be increasingly these days a rental unit. It can be a place that someone buys as a house, or it can be a short-term rental. I don't use the term vacation rental deliberately because these things occupy different spaces all across Alaska for seasonal employers and all that other stuff. But increasingly, these three things are items we're tracking together when we talk about housing. So in a 10-minute overview of this, this is the perspective that you're getting.

The synopsis is The housing market is tight in most of these spaces. It's expensive and it's getting more expensive. If we look at the rental space, the reason why I included this picture here, this is a modular unit constructed by NANA that was shipped up to Nome for one of our recent housing developments. This unit could be any one of these three and it could jump across that spectrum at any time during this year. If it operated in the rental space, it would be in the group of properties that have on the statewide basis a median value of about $1,450 a month in rent.

So that's where we take the smallest rent someone pays and we look at the highest rent someone pays and we find the midpoint. That's what we're talking about with the median. So that's gone up over the years. Statewide, the vacancy rate is hovering around 6%. It's actually well below 5% in most of the hub communities.

There are a couple of places where it is close to 10%, but the highest vacancy community that we survey in this region is about 10.5%. So vacancies tight, rents continue to go up. Homeownership, what do we have there? That is a bit of a different story in that we do a survey of lenders, and this is where we get the data, so we're actually getting this from banks that respond to our surveys every quarter. If we look at the same period that we survey for the rental market for the homeownership, the average sales price is over $400,000.

And when we, when we pulled these numbers back in March to make it equivalent to the Rental Market Survey, the interest rate was just under 6%. So that's high. That is not representative of every house. That's the average. So the homes on the higher end are driving up that value.

We don't have access to the medians or to present you with quartiles, but from the data that we see, the homes that are selling are driving the averages up and it's a very expensive market. Short-term rentals, it's a new thing. It's a new product class. We don't have a lot of historical data to compare this to. But when you look at how much revenue these units are generating, according to our data, it's somewhere between $1,200 a month in the trough months when there are seasonality factors going on, all the way up to $5,100 a month when we're in the peak season.

So it's a wide variance or swings in revenue that these are generating, as well as occupancy. We're seeing between 30% and 70% of the units are occupied that are listed. So a lot of volatility in occupancy, but a lot of upside in what people actually get for these. So when I said that the markets are tight, this compares affordability in the rental and homeowners— homeownership space. But what I also wanted to do was include— I apologize, this is a bit of a busy chart— a snapshot of population growth.

If you look going back, this is the data that our Department of Labor and Workforce Development reports. We have roughly the same amount of people that we did in calendar year 2013 to 2014 as a state. Some communities have gone up, some communities have gone down. But when we look statewide at what's driving the tight housing market, we have population that hasn't moved a lot over the past couple of years. So what's to explain this?

Are we seeing bigger households separate? So we're seeing multiple households where there used to be one. Are we seeing housing stock coming offline? Houses are like people. We, we all get it.

We all get up there in years, and sometimes you can repair them, and other times they, they get demolished and move They make way for the next generation of housing. Are units coming offline? There are any number of explanations for this, but it doesn't appear to be population-driven based on the numbers that we're seeing.

The Lions rents over this period have gone up by about 30%. It's been fairly consistent. The homeownership costs have gone up by over two-thirds. About 40% of that is attributable to the cost of the homes that we're seeing in our survey. The other is from interest rates.

Interest rates were about 3% at the trough, and they went up over 6% in the peak years that we've seen. So the separation between rent and homeownership is still real, but the lines have stopped moving away from each other at the pace that they did a couple of years ago. When we talk about homeownership, we have a couple of data sources that we look at for this. We, like I mentioned, we survey— lenders on a quarterly basis to generate this chart. And I want to qualify this data a lot by saying we survey the data.

This is a sample. There are a lot of online banks that are outside of our survey. When we check the federal sources, like the Federal Home Loan Bank, Federal Reserve, they have access to more data than we do. We tend to see that their datasets move in the same direction as ours. So when we're presenting this slide, I want to make it very clear, I'm not saying that it's 4,000 X number of units, that that's the size of the market in Alaska.

That was our sample. But we tend to see the same shape and the same slope in the lines with the lending market. What is telling about this is you can probably guess where the interest rates went to 3%. The brackets in yellow there represent people who are potentially benefiting from a 3% mortgage that are maybe reconsidering whether or not they want to move facing a 6% mortgage. So it was a boom year in 2020, 2021, but it could be having very real effects on the market that we're dealing with now.

So is it real estate risk? Is the market underperforming? Is something going on, or is it people locked into a 3% mortgage? It's an open question. Vacation— not vacation rentals, I just said I wasn't going to do that.

Short-term rentals. This is— it was a new data set. It's actually been around for enough years that we're starting to get some predictability with it. Not predictability, some familiarity with it to see whether or not we're going to have wild data spikes that are generated by it being a new data set. It seems to be behaving itself as far as data goes.

We're seeing the peak to trough continues to increase, so we're seeing an increasing rate of short-term rentals listed and occupied in the market each year, but that rate is slowing. It's still positive, but it's slowed considerably. When we look at how many units are occupied in this space, it ranges in the trough months when you're looking at, uh, the orange is the occupied listings and the blue is the listed. When you look at the least utilized time of the year, it's about 1,500 units recently that we see. Units per month that are in that space, whereas the peak months, it's over 5,000 units.

So it's a pretty significant range in units that we see coming online and offline in this space. And when we're comparing $1,200 a unit in revenue for these to $5,100, there's seasonal volatility to that as well in terms of where those revenue numbers come from. Oh, I'm sorry, I just got my little dog barking. Oh, that was your mother. I still have 54 seconds left.

So where does this leave us? We have tight markets. We don't have them being driven by a lot of different people. And we have inventory moving all across the place. We're trying to figure out what we can do to continue making housing affordable for Alaskans.

So what you see here is, again, that unit that we funded in Nome. It's a rental unit. Because it was part of our program. It could have been any number of things if Bering Strait Regional Housing Authority had a different plan for it. When we look at vacant land like the type— the picture there, it's actually a property that we picked up from the university last year and we're in the process of getting that developed.

Whenever someone's looking at the less than 1% of Alaska that's still available for sale, they have to make a decision on what they're going to do with it. The margins on these properties, when you're looking at $1,400 a month in rent versus $5,100 for a short-term rental or a home that you can sell to a homebuyer that's going to come out there with $300,000 or more in mortgage funding to take out your risks. These are real choices. And in a spreadsheet, they lead to mathematical outcomes. So I'm not— I'm not advocating for one thing or the other.

It's just that these are the numbers. And when we look at what people can actually do with the lands, The numbers are pointing them in certain directions. So with that, I hope this is helpful. We're available to answer any questions. Stacy, for anyone who holds elected office or is running for elective office, in the background is our Governmental Relations Director.

She's standing up. She can get you a copy of this, or we'd be happy to follow up when whatever detail is helpful. But thank you for the opportunity to share the data. Thanks.

Thank you, Daniel. Now, I don't know how many of you noticed on slide 5 that it said the data had been cleaned up to exclude non-traditional dwellings, such as treehouses. So Ross, I think for our next one of these, I think we should focus on those treehouses. I want to know how many there are for rent. Next up, we've got Griffin Forster.

Griffin Forster is Executive Director of the Association of Alaska Housing Authorities, the network of regional housing authorities serving communities from the Aleutians to the Arctic. He has spent his career on homes and energy systems built for the places most of America won't know are on the map. If you want to know why the housing shortage looks different at Utqiagvik than it does in Midtown Anchorage, he's your man. Please welcome Griffin Forster.

This right here? That'll do it. Okay. Uh-oh. I've already broken it, Ross.

Sorry. Good afternoon, everybody. Well, he's fixing my mistake. My name is Griffin Forster, as he said. I serve as the Executive Director of the Association of Alaska Housing Authorities, and my goal here is to really help maybe make people aware of a class of organization they might not have been aware of.

Who knew about regional housing authorities before today? Show of hands. Okay, good. Good amount of awareness in this room. How about NAHASDA?

Has that term floated around? I get some hands here. Good. Then we've got some room to run that I can be useful here today. So about AHA, and AHA is distinct from AHA, the Aleutian Housing Authority, or any of the other number of entities in Alaska that might have that acronym.

I really like to say when you look at the housing shortage statistics, that puts the ahh an aha. It's pretty sobering. We are an organization that's been around about 30 years. We provide nonprofit— we're the nonprofit voice for Alaska's 14 regional housing authorities. Federal and state advocacy is a big part of my job, which means I'm on the phone with people from Washington, D.C. who are never going to come to Alaska, let alone a place like Utqiagvik, and try to make it make sense to them, right?

Try to explain how a 2x4 can cost $13, that sort of thing. It's a big part of that job. Training and technical assistance, making sure our members have the tools and the know-how to do their job. We do— we are a pass-through entity. We receive a lot of— a share of HUD funding to provide that information to our members, everything from contract administration, procurement, environmental reviews.

Mold remediation, and so on. We also do— recently have done with some private support leadership training and development for the next generation of tribal housing professionals. So very excited to do that. Funding updates, research and analysis, other member services, we're really taking some long looks recently at what we can do to be— to provide more shared economies of scale, you know, like the Costco effect. Everybody in Alaska understands the Costco effect, right?

You do more together, you save more. So that's what AHA is and does primarily. We're a pretty small shop, but I work for 15 of the most amazing people you're going to meet in the state, the most diligent, innovative, resourceful human beings you could have the pleasure of doing business with. And if you're in the housing field, it's a funny conundrum because It's a commodity or a social need that everybody understands. Nobody disagrees and thinks we need less housing.

But to actually get it done and built is humbling, very, very difficult process. And I'll share some case studies related to that later. So regional housing authorities were created under Alaska state law in the 1970s. The legislature essentially found there is no private sector path to getting housing built in much of the state where local economies are so depressed. Logistics are as intimidating as they are and infrastructure is so constrained.

So we are going to allow this class of instrumentalities to do this work. Now, RHAs are an interesting legal construct. They exist once, you know, at the same time kind of in the state legal world and they also have— are set up as vessels to receive federal funding, the Indian Housing Block Grant. So they are designated as Tribally Designated Housing Entities, TDHEs, under the Native American Housing Assistance and Self-Determination Act of 1996, which is NAHASDA.

Every region served is different. Most folks around here will know Cook Inlet Housing Authority. It's their former leader Carol there, and my good friend, and their color and their design and their innovative thinking is is on display around here. You also— I worked as a CEO of the Regional Housing Authority on the North Slope for 6 years. Housing typologies look very different up there.

We were building homes on sleds starting 10 years ago because it's easier to move a home that's like built to move than to take it off pilings, right? Like that was our kind of insurance policy for the long term. Down in Southeast Alaska and Western Alaska, everybody builds it differently. The scale of RHAs varies a lot. You've got Cook Inlet Housing here, who is a tribal designated housing entity for Searee, for one entity, and you've got the AVCP Regional Housing Authority, for example, in Bethel, which serves 52 tribes.

So a lot of different scales and approaches to that work. And then there's several dozen tribes that are not affiliated with a housing authority out there, like the Native Village of Barrow and Kotzebue would be a couple examples, generally larger tribes. That receive their own share of HUD funding and do that work independently. So what is NAHASDA? And NAHASDA, just for the record, does not stand for Never Any Housing Available, so don't ask.

I've heard that one, and the first time I heard it, I'm like, wow, that is a piercing insight that reminds us how important this work is. You know, and I don't mean to be flippant there, but I'm like, I knew a friend up on the North Slope who who grew up on a waitlist, right? And he's the first one I heard that from, so it underscores for me the importance of doing this work. It's a landmark law passed in the late '90s amid the Native self-determination movement. And what it really did is took a bunch of different HUD programs that were sort of rigid and top-down and replaced them with a flexible block grant, the Indian Housing Block Grant Program.

Which emphasizes self-determination and tribal sovereignty. It really is this unicorn piece of public policy. It allows individual tribes to determine their own approaches to meeting need, whether that's new rental units, whether it's homebuyer units and assistance, rehabilitation, weatherization, serving elders, that sort of thing. It's the largest single source of federal funding for housing in Native communities nationwide and HUD's largest investment in Alaska. So today, 30 years later, this is the 30th anniversary of NAHASDA, it has not been reauthorized.

In fact, Congress has not acted to reauthorize it since 2008. The political reasons for that are beyond the scope of my discussion here today, but this has created a lot of uncertainty for regional housing authorities and tribes as developers, right, because like you want to know what the horizon is for future investments. And you're going to make different decisions about what you might build today or how much you would devote to development versus operations and maintenance if you don't know what the future holds, right? As time has gone by, there's, you know, time has passed on this and there's some outdated process and legal barriers. There's some complexities in environmental reviews.

There's this Build America, Buy America Act that came with the infrastructure bill in 2021. That added a lot of new compliance requirements to what regional housing authorities do without any funding to support that, right? So an unfunded mandate. And that just stresses capacity that is already very constrained, you know. Our members, like, you know, putting something like BABA on the back of the procurement officers as a housing authority just makes an already hard job that much more complicated, right?

And this is a lost generation that's referred to in my title. For the last— since— from the late '90s through 2024 or 2023, the Indian Housing Block Grant appropriations remained essentially flat. And of course, inflation did not stay still in that time, right? So you can see, you know, roughly what that looks like on a nominal basis in the graph in the chart. The chart at the top there, and then below that you can see the inflation-adjusted basis, and you can see that blue field in there is that lost generation of housing production and opportunity.

Maybe a simpler way— and that note there just says that's thousands of homes that did not get built for Native communities across Alaska, across the rest of Indian Country. 2024 Appropriations did go up, thanks to some champions in Congress, but that returned the Indian Housing Block Grant temporarily to the level last seen when you adjust for inflation in the year 2000.

You don't need a degree in economics to understand this picture, right? So this is— I'm going to credit my friend, former colleague Chris Kolarock for this. He used to run the Bering Straits Regional Housing Authority. This is the Village of Brevig Mission. Out there in the Bering Strait region.

Those homes in the red circles were built 25 years ago, roughly, not long after NAHASDA first passed, those 20 homes. You can see in the green oval up at the top, the homes that were built in the next tranche, 15 years ago. 5 To 8 years ago, those homes in the black circle, the 5 homes, that's inflation, right? Lost purchasing power to tribal communities. It speaks for itself.

So how are regional housing authorities responding to this? Right now, I'm very excited to say we have been spending the last year developing the next generation of leaders for this incredibly complex and difficult work that takes a lot of skills, confidence, connections, ability to think outside of the box. You know, my board, many of my board leaders have been spending the last 30 years implementing this law, right? We need to bring up the next generation there. There's a lot of focus on shared capacity, economies of scale, as I mentioned, and elevating housing really as a— not just a commodity or a need, but really a key to economic development in communities.

Innovations and partnerships that drive real savings. I'll talk briefly about a couple of these. This is a— I was in Kodiak last week. Great self-help project going on down there. Great partnership between Kodiak Island Housing Authority, Kodiak, the regional corporation, Rural Cap.

I see Teal back there in the room. Really overcame some barriers there. Other one I was involved with was a military airlift, 39 tons of construction material up to the north slope at no cost to the regional housing authority. $1 Million in logistics. Happy to go into more detail on that later, but I think this is how to get a hold of me here.

My information is there. Thank you for the time to share a little bit about AHA and our members with you.

I will probably never forget the acronym, but I'm going to get it wrong every time. Never Any Housing, So Don't Ask, NAHASDA. That's, uh, or never any housing available, so don't ask. I don't know that I'm going to remember the real one. So Bob Dole is the Director of Community and Economic Development for the Municipality of Anchorage, where the Planning, Development Services, Real Estate, and GIS departments all report to him.

And he has a direct line to the Mayor of Anchorage as well. He's also a retired colonel with 3 decades of military service, and he has the distinction of being the only member of the panel not wearing glasses. Please welcome Bob Dole.

Hi, I'm Bob Dole, Director of Community Economic Development for the Municipality of Anchorage. Thank you for the adjustment there. I needed that apparently. I'm just going to give you kind of the local view of what we can control and what we can't in order to get on with housing that I think we all agree we need. First, you all recognize these factors here.

I think— I just wanted to spell them out though. There's a lot of national and regional things that we that you can't control, but you have— but if you're a developer, you have to deal with. If I was a developer or builder, I would need a special budget item just for roll aids, thinking about the uncertainty and cost these create. I put an asterisk after that last one, offsite infrastructure needs and cost. Senator Murkowski spoke a lot about this 2 days ago up in Fairbanks at the Alaska Defense Forum.

We're a young state and we don't have the water, sewer, utility lines, roads that— places that have— than states for a couple hundred years have. And that's a huge challenge for us in terms of what we need to do to grow our housing going forward. It's also a really expensive challenge going forward. By the time you look at a road and you put in water, sewer, and a road, you can be looking at thousands of dollars per linear foot to go forward. It is a huge burden, and there isn't a clear way to fund that.

The utilities have their rates regulated, so they don't get to build a capital reserve fund to do those improvements. Typically, it falls on the developers to be passed on to the owners in a new subdivision going forward. There's a couple little things we can do to mitigate that. The first one are called cooperative development agreements, where your utility will partner with the developer on a project. You can get a slight reduction in cost that way.

And frankly, our congressional delegation are tremendous grant chasers in this area to help with the infrastructure cost going forward. So what can we do? Well, first I want to say, despite these headwinds we face, the builders have been stepping up. You can see there the last 3 years of results looking at housing units. If we look at '24, it was about 290.

Last year, 401. This year, we're 412 to date. It's a climb gradient, but not steep enough going forward. We can look at this also in terms of valuation. And you can see we continue to climb in valuation.

We're up over $100 million in construction activity compared to last year. These are the metrics I look at to see how we're doing, just as kind of a barometer going forward. So where do we as a municipality lower the cost going forward? There's basically 4 areas we look at. First one, cut red tape.

If we had Title 21 up here and set it here, You might not be able to see me. It's about 1,000 pages. And that's just our land use title going forward. It is a large tome to navigate in order to develop going forward. Streamline municipal processes.

Municipal processes need to do what they need to do for governance, but they should not become a barrier in and of themselves in terms of development. Incentivize development. How can we as a municipality leverage what resources we have in order to support development going forward. And finally, remediate neglect. A building that is beyond salvage, that is just drawing problems, drawing emergency responders, dragging down the neighborhood, creating safety issues for the children who have to walk by it, is a drain on the economy.

And we have to recognize we all have a duty, too, to get after those as they go forward. Forward. So what's that look like at a more granular level? Title 21, I talked about this thing. We have to take out of it what doesn't make sense or adjust it so it does not become a wall or a barrier to development going forward.

We have paused— we had a design on— pause on design standards that were creating one of those walls to development. We have to be responsible in our development to avoid conflicting uses and that's done through what we call it comprehensive plan and zoning. But we have to make sure it doesn't become a barrier. We found a— by a way to accomplish that, what are called just a rezone process. It's only a $200 fee and much easier than what was previously a more long drawn-out process.

And also, we have to avoid things that don't make sense. If you want to remodel your bathroom and you have a driveway that is now considered not to be code compliant, you shouldn't have to fix your driveway in order to get— do that bathroom remodel.

But that was the practice until just a couple years ago. Those are the sorts of things where we need to make sure that the code is doing what it was intended to do and not just presenting a challenge. The next area you're going to see movement on— we have right now going to the Planning and Zoning Commission a proposal— actually, I had one more line, but then we'll go. We're fine. We're fine.

OK. So— and with Planning and Zoning Commission, we have what are called variances. When you have something that doesn't meet dimensional standards of the code, you have to go to a commission in order to approve it if it's over a certain amount. So what that means is something that should be relatively easy, a common sense thing for a director to say, "It doesn't work, but it doesn't fit, but it's not material," instead will be drawn out in 3 or 4 months of process of preparing an application and a staff report and a public hearing with one of the commissions. Case in point, a contractor I've had a sidebar with went in to replace a deck and back stairs for a house that really needed it because they needed it for a fire exit. However, 40 years ago, their front step was built 10 inches into the front encroachment beyond what the planning director could waive.

That cost them hundreds of— actually, thousands of dollars and a 3-month delay in construction. That's why we are going forward to address where— to give the Director the authority to just deal with these de minimis variances rather than tie up the cost, the delay, the risk of missing a building season and also working more on our volunteers who volunteer— your local citizens on the Planning and Zoning Commission, Planning Board and ZBEA. Ah, now we are here. Also, we have to make sure that we're working on our code and processes to go forward, not to hold things in place. Recently, we updated our building code, and when we did that, we brought in 100 folks from the industry to say, "What makes sense so this doesn't become a speed bump but rather supports development?" And what they did this time was they were inclusive.

They said— we looked at all the appendices we could adopt. So if you wanted to do something that is not normal construction, we will already have in place, if the International Code folks have looked at it, the code path you can expect. So you have predictability when you show up for your permit on how that looks. Previously, those were by exception, and if you wanted to do something that was a little unusual, say 3D printing, you had to kind of go into the building and see how it was received. Now there— we have affirmatively adopted the code language to deal with areas like that.

The— also a part of that was we kind of stretched out there a little bit with what's called single stair for buildings of a certain size. By doing that, we're able to better repurpose our buildings, some of our older multi-use buildings downtown into residential use. That was a 6-month negotiation with the state to get that. It was a heavy lift. And what really excites me is what we're doing now, rolling out first quarter of next year, which is a new permit management system.

Our permit management system now is the equivalent of carbon paper and multiple copies that don't talk to each other. It was an over-customized system that they continued to over-customize after they brought it online in 2005. It is unwieldy. It's clunky. Your designers and builders spend excessive time having to navigate through it.

It does a lot of things that are a filter rather than— or a block to effective communication between the design team and the reviewers. And also, it is unbelievably painful for pulling management reports to assess how things are operating there. We're finally jumping forward to move into this millennium. It's kind of exciting. Another area you have to focus on, you may not think of, but the municipality can influence is lowering operating cost.

By cleaning up a lot of our processes and demonstrating compliance with a certain level, we're able to increase our ISO rating from from a 5 to a 3. The ISO is an organization that looks at how well you're handling building safety for the insurance companies. By doing that increase in rating, we decrease potential premiums as the insurance companies look to that for guidance on how well your inventory is built together. So it's an important step going forward. Another effort we're doing, we're working with the base for a waste-to-energy plant next to the out by the current garbage dump.

What that will do is two things. First, by burning waste rather than putting it in the landfill, it'll create redundant energy and create capacity that way. And what really excites me, being close to the construction business, is you can also burn and destroy in place a lot of the hazardous materials we haul outside now. If you have a problem with PFAS right now in a building or you— when you tear out the asbestos or PCBs. What you do is you tear it down, you bag it, you drive it to the port, you put it on a barge, it floats down to Seattle, it gets on a truck, it goes out to Utah where it's buried.

Tremendously costly. The ability to destroy in place is a tremendous way forward in terms of lowering building cost. And thank you for the prompt.

We continue to press tax incentives. You know, in law school, the first thing they say is, "Show me the money," or, "Follow the money." And that's the biggest impediment we have in a lot of projects penciling out. We have with past— the past two acts been able to trigger a lot more capital and make projects pencil out. And we're looking at a couple more that we think will further increase that opportunity. We're also— we are right now proposing a swap of Block 102 downtown with Tozier Track that— so to work to bring housing to both of them and also have some other large parcels up for redevelopment.

We have some great products online to assist you in finding what your next project in town is with our GDIC library. And we're always looking for other means to find efficiency. How close am I? Thanks.

I think you should carry around the Title 21. It'll be a nice little visual aid. Next up, we've got Mark Foster, our next presenter, who's going to answer a question most of us have never thought to ask unless you live in the underground house on Forest Park Drive, which is how much of the price of a new home is buried underground before the foundation is even poured? Mark Foster is principal of Mark A. Foster and Associates, an Anchorage consulting practice and a longtime consultant to the Institute of Social and Economic Research.

At the University of Alaska Anchorage. He's a Stanford-trained engineer and a former commissioner for the Alaska Public Utilities Commission. Please help me welcome Mark Foster. Thank you. All right, I'm gonna try and move relatively quickly given the hour.

Can we find a few more affordable housing units if we reduce utility interconnection prices? Not costs, Prices. Thank you. You can read that later. All right.

What are the questions? Where have all the houses gone? How much does it cost to build a new housing unit in Alaska? We'll look at some comparisons. How much of that's utility-driven?

And what can we do about it? All right. First thing, how big a problem is it? So I went and said, OK, what's the housing market in Anchorage look like? Before COVID during COVID and after.

And let's compare it to Spokane, which I've compared a lot of things to, so I can just see how a regional hub does before, during, and after. Before COVID we had roughly 426 listings in any given month more than Spokane— 17, 18, 19. We're ahead of them during COVID slightly ahead. They declined and we're a little bit ahead, about 86. Post-COVID, this summer, Spokane is 1,375 listings ahead of Anchorage.

Anchorage is stuck in the doldrums. We have a problem. I don't know the source of the problem, but I know we have a problem looking at the listing data. At the regional market that is Anchorage housing. So I'm inspired to look for how can we reduce costs and potentially prices to help generate some more action in the market.

How much does it cost to build a new housing unit in Alaska? Look carefully at the vertical axis in dollars per square foot.

The big dots are sized based on the number of houses in the unit.

That's $2,500 a square foot.

$2,500 Per square foot in rural Alaska for a large multi-unit development.

The urban areas, $300, $400 a square foot. I can get up to the hillside for a fancy house, I'm at $450 maybe. So that's kind of the range that we're looking at. The small dots are fourplexes I was able to find.

It's really expensive.

And I had an opportunity to look at this for the Denali Commission a little over a dozen years ago. We are going faster than inflation in terms of the prices and costs that we're paying all across the state. It's not just commodities, it's not just labor. Other factors are playing in.

How much of that Our utility interconnection costs— the answer is it varies a lot depending on how close you are to the main, the water main, the sewer main, et cetera. Big spread of costs. And of course, once you get to a point where the costs are too much, you're not developing. So I'm— my sample of data really is ones that look like they're going forward or have gone forward. So you can get a really big quote out there, but if it's not going forward, it's not included in my data.

All right. So with that, what are some interesting observations? We're really expensive. I use Texas as a benchmark. You'll see there on the far right, half a percent to a percent in Texas for utility connection costs for a housing unit, residential on up to multi-unit developments.

Why? They're short, shallow trenching.

We're digging deep trenches because we are in an Arctic environment. Huge driver of costs. The water lines in Anchorage are typically at 10 feet, which means we're excavating maybe as much as 12 feet down.

That's a big expensive hole. The size of the pipe isn't the big consideration. It's the darn trench and how long you're trenching. That's a big problem. So I go and look at Alberta and go, all right, now let me look at another Arctic place.

I'm starting to see high costs again. So when you compare costs between Alaska and other places, be very mindful that you're comparing a very different environment.

And it really does sort of cap how much you can sort of extend your water sewer system. Electric's slightly different, but it has interesting similar challenges. If you look at copper inflation, you'll appreciate the electric system is strained. If you look at transformers, you'll appreciate the electric system is strained, largely driven by the stock market bubble you're all enjoying.

All right. How can we reduce costs and prices by shifting the utility interconnection cost pricing toward economic development rates? What does that mean?

NSTAR service lines. If you look at their tariff, They are paying you a 50% credit today against their 5-year average cost on a service line. They're giving you a 50% discount to expand their system. It's an economic development rate. I want to see something happen.

Interior Gas Utility— they ran out of grants and they are continuing to offer a 90% credit. They want to expand their system.

Basic policy premise: I want new customers. I want the new customers to cover all of their costs and make a contribution to the utility's fixed costs. Utilities have a lot of investment and a lot of fixed costs. Let's find rates that make a contribution to that. An ex— intriguing example from the lower 48.

They said, "All right. We believe it's important to expand our utility systems by making those interconnection costs and prices more reasonable by recognizing the value new customers bring to the system and spreading out those fixed costs." They said, "Shoot, let's do a discounted cash flow over 7 years." What's your contribution over 7 years? Well, if the residential customer monthly rate for infrastructure and customer service, not the commodities, not the gas in a gas system or basically in the electric system, not the fuel they're buying. Just the— those costs that are associated with the infrastructure and the customer service. Those are largely fixed costs.

Water and sewer, they typically run about 80%. Electric system, those fixed costs might run 70% when you look at the cost studies. So the monthly residential customer contribution to fixed costs might be $40 over 7 years and discounted back. That's a $2,605 credit on a line extension, which is better than zero, which is what you have today.

Sewer, water, and electric in Anchorage, just to run it out for examples, you get a sense of $3,000 to $4,000 line credits using that tariff model they have in the Lower 48 where they give you 7 years. So in summary, 50% of the cost, 90% of the cost for gas, discounted cash flow model on the tariff on the— toward the utilities fixed cost. Let's give you some credit for that line extension. Add them up, $13,000, $14,000. Let's say something like 3% on $420,000 to $430,000.

Now, What's that equivalent to for those who are really paying attention to the market? Roughly equivalent to a reduction in the interest rate of about 300 basis points. So if interest rates went down by 300 basis points, would you pick up some new houses? I would submit you pick some up, and I think it's worth considering. And that's my presentation.

Thank you very much, Mark. Next up, we've got Tyler Robinson, who is the Vice President of Community Development, Real Estate, and Planning at Cook Inlet Housing. He joined the organization in 2010 in development finance, and he has spent the years since getting housing built, navigating land use code, financing structures, and the long distance between a good idea and a certificate of occupancy. When Anchorage rewrote its site access ordinance to unstick housing development, Tyler was one of the people in the room. Please help me welcome Tyler Robinson.

I'm using— Ross, is this what I'm using? All right. Thanks, everybody, for having me here this afternoon. Just a little bit about Cook Inlet Housing. We're one of those 14 regional housing authorities that Griffin was talking about earlier.

We are here in the Searee region. I would say that of the— Of the tribal members that live in our housing, about 90% come from regions outside of the Siri region. So we really sort of exemplify Anchorage as that hub that we are. We also use that NAHASDA money that Griff was talking about to leverage additional dollars so that we can serve everybody in our housing. And I would just say we're here in part because we stand next to people like Sean Debenham and private developers to say we build the same thing.

Just because we are a nonprofit or regional housing authority We're in the same permit center, we're working with the same contractors, and so we sometimes can use our models that are maybe less profit-motivated to say, hey, these are some challenges that exist, this is how we might be able to make some headway. So what type of product do we offer? We build primarily what we would call affordable housing in a senior and family model, but— and that could look like a 3 or 4-story elevated building, it could also look like Scattered sites, it could look like townhouses, it could be garden-level apartments. And we also do— we have for sale product. We have 8 condos for sale that I'm willing to talk to anybody about in Eagle River after this presentation for left, jump on board.

And then I think what I would also say is within our housing development, we take a sort of neighborhood and a community development approach. So in addition to housing, we're looking for other ways that we might be able to provide investment and sort of energy into a neighborhood, whether that involves, you know, public art or open spaces or just working with small businesses, nonprofits, artists in commercial spaces that are part of those housing developments. So what does today look like as opposed to roughly 10 years ago when working with AHFC and Daniel, Uh, in 2014, this was a typical deal size for us. So a 50-plus unit development in Eagle River, uh, a mixed income development where we have both affordable and market rate units in it. And I contrast that with something we built just a year or two ago.

Uh, the typical deal size is 20 to 24 units. So we go through the same process, we have a lot of the same fixed cost to bring these 20 units online, we have the same We have different operational challenges, right? Less efficiency to put a 20-unit development together. We're often having to piece 2 or 3 phases to just get to operational efficiency, whereas in the past, we used to be able to do that with one single phase. So we're definitely feeling it, not just on the construction side, but then when we turn around and operate those buildings.

So my framework to have this conversation today are the 5 L's. I saw this presentation done by a guy named Eric Kronberg who's an urbanist, a designer, an architect, and a real estate developer in the Southeast. I think he originally came from Atlanta. And he used this. And really, the purpose of him using this was to say, "Hey, we're going to focus on land and laws and really figure out how we can use our existing land base more efficiently, get more units in a much more incremental and sort of smaller way." So when I looked at those 5 L's, the only problem was as a rental developer, builder of rental housing, the operating side, the development pro forma that Daniel makes us, you know, sort of fill out and scrutinize to figure out whether we're going to get a project funded or not, the operating costs really matter.

And so the problem was I couldn't figure out the L, but so I relied on my high school French. You have les opérations. And so I'll just leave that as my operating costs and I'll include that in the category. So again, I'm going to focus on a couple of examples of land and laws, and then we can talk about the others. I think the other speakers have definitely touched on things beyond those two categories.

So the first one is land, and I really want to, you know, show appreciation to Bob Dole and Mayor LaFrance and their whole team. They really are making an effort of getting municipal land, whether that was obtained through tax foreclosure or a problem property, or whether that's municipal land that's just been in inventory for a while. Trying to get that out there. So the first image is a house we're under contract with. It had a fire.

It was sitting in the neighborhood for 3 years. The muni figured out how to get site control of it, and we're under contract to close and replace it with an existing— with a new housing unit next year. The larger sites are harder, and I think my pitch would say, so the municipality and other jurisdictions have larger pieces of land. One of the ways that they get rid of land or they they dispose of that land is through request for proposal processes. And I would just say that those processes aren't always amenable to really getting directly to a deal right away.

In other words, I would much rather see those RFP processes be about invitations to partnership, ultimately building a 15, a 25-acre site that has maybe some challenges, maybe some community expectations, maybe a role for the municipality to play. We really have to figure out not so much of, "Here's what the finished product is, please pick us," but how do we get somebody on board or a team on board that we can work together to bring housing to fruition in the near term.

Land means nothing without infrastructure. We've heard about that already. And I think about infrastructure really in 3 different ways. One is just getting infrastructure to that land to make it developable. The second is the infrastructure that you have to build on your site itself to sustain it.

The bigger the site, the more both public and private infrastructure you have on your site. And the third is offsite improvements to infrastructure. So in the first one, you know, absolutely the last speaker— I mean, we just broke ground this week on a water main extension to serve 40 homes. I think our estimate from AWWU for that improvement was somewhere around $400,000. The bid came back at $900,000.

This is a big deal, right? That doesn't—. That's just getting the main water line to the lots that we can serve these 40 units, 2 20-unit phases of development. Similarly, we are working to advance a senior housing development with a partner in Wasilla, and that project's on hold right now because it's not clear that Wasilla actually has sanitary sewer capacity at their treatment plant to serve that building. These are big deals, right, when we talk about housing.

Uh, off-site stuff— I think Bob has done a pretty good job, but this, this is still here. In other words, if when I say off-site, this is— I'm, I'm building adjacent to a road that already exists, but maybe that road doesn't meet what we would sort of want it to look like or what the standard would be. So often that means it doesn't have a sidewalk, it's not wide enough, it doesn't have curb and gutter, and The requirement to fix it often falls on the developer. And so these are two examples that we've shown. We're working for ways with the municipality to figure that out.

But it's still like, as Bob said, ultimately at the end of the day, it costs money from somebody or it costs us looking at development, maybe at the actual standard a little bit differently. The laws part, and I hope I don't steal Sean's thunder, but he said, you know, number one in zoning code do no more harm. I hope you weren't going to say that. But he's like, before we talk about changing anything, just don't do anything else that will hurt us even more. So this is zoning code, this is building code, this is policy, this is procedure.

This is all the stuff that Mr. Dole is really working on and I think working well on. But I wanted to give this as an example because one of the slides that he said— put up there said, hey, we've paused multifamily design standards. Basically, what do you have to do to make— because we believe— there was a point when someone wrote this that said, in order to have this type of housing, we want you to make it as pretty as possible. Of course, that's their subjective opinion on what that looked like. If these two buildings were hotels, the only thing you'd have to do was that first bullet, go get a building permit.

This is not, however, a hotel. These were multifamily— multifamily residential buildings. Those are the other things that we had to do. So right now it's paused. It could come back in 2028.

Obviously, not having to do these things is a big deal. It saves cost. It saves a ton of time. We have two developments right now that are underway because a process requirement has been suspended. So we were able to move those forward a year earlier because of actions by the administration and the assembly.

So finally, beyond land and laws, I mean, I think we've heard some of those things, whether it's utility costs. I think there are things that we are sort of compelled to look at. Griff had these examples of modular housing. I mean, we had a project last year. It was pretty cold.

The framing crew walked off the job in January. That's a problem. Now, if they were building in a— you know, in a controlled environment all year and we minimize the amount of time it took to actually get that building dried in, might be— it might have sort of been a different situation. So it's a—. We're optimistic.

We're not jumping into modular manufactured housing right now, but it's something we ought to look at. Northrop Bank has what appears to be a pretty positive new product that looks at both the construction-to-perm loan conversion. I get calls all the time from small landowners that say, hey, I want to add a duplex, I want to add a unit. Where do I get money to do this? Right.

I think even at the smaller scale, there's a big opportunity. And then finally, my high school French. I mean, we— I'm not sure that our affordable housing portfolio can withstand the natural gas price increases that we're going to see. Simply put, I don't know that we're going to be in this business or what that's going to look like. And so We absolutely have a need, and that's not even talking about what it's going to do to new development.

We've got to look at these sorts of things. So with that, thank you very much.

All righty. And last but certainly not least, our final presenter builds housing for a living with his own capital on the line. Sean Debenham is president of Debenham, a family development and property management company that has been doing business in Alaska since 1964. When his father Ray built his first fourplex. Under Sean's leadership, the company has delivered hundreds of residential units focused on market-rate and workforce housing, including Block 96 Flats, the first market-rate apartment building constructed in downtown Anchorage in more than 15 years, and the Residences at Northwood.

Please help me welcome Sean Debenham.

I'm going to— is this working?

Testing, 1, 2, 3, and—.

Excellent. Awesome. I'm going to use this because I feel like this thing is going to hit me if I stand over here too far. And it's kind of distracting on top of that. So I'm going to use this.

I'm going to start with a story. So 20 years ago, I moved back to Anchorage. I was born and raised right here in Anchorage, Alaska, in Midtown. Went to East High, graduated, left for school, went to Denver, Colorado, worked as a structural engineer there for several years. Decided, hey, I want to move back to Alaska with my family.

I was married, had 3 kids, and want to do the typical thing, right, where you move back to a community, you get into an apartment building, you live there for a year or so. You know, let you— allow you to kind of purview Anchorage and see which kind of section you want to live in and then eventually move into a single-family house. I thought I was going to do that. I got up here after being away for several years, and I was like, oh my gosh, there's nowhere I can put my family in apartments up here. There's— we have all this '80s garbage that I'm not really interested in living in.

And I was like, we need some apartments up here. So I have a passion for multifamily housing, for housing. So I was like, this is a great fit. I should probably expand this and keep doing this and doing this. And so that's kind of my beginning of where I stand, or I came from, is I have a passion for housing.

I love to do it. I feel like the developments that we do not only bring housing units online and homes, but they enhance the community. In which they are. When you look at Block 96, you look at the residences at Northwood, you look at Raspberry Townhomes, these developments are actually enhancing the community in which they are, and that's important to me. So with that being said, I'll quickly just go through what's working, and things are working.

After 20-plus years of nothing working, we have finally made this— so instead of doing this like we're now kind of doing this, right? Like, so it's not going down anymore and it's not even level. It's actually starting— it's starting to kind of go back up. And so we want to enhance that and build on that and make it awesome for us and for housing. So things are getting built, you know, Block 96, the residences at Northwood, Raspberry Townhomes, the tax abatement.

You know, tax abatements are wonderful for those of you who aren't in Anchorage or in other communities. Tax abatements erase the sins of bad policy, essentially, right? So when we get into a bad position and we have to try to dig ourselves out of that, tax abatement is really good at cleaning those things up. So it works, it really does. Design standards moratorium— awesome.

Design— or sorry, Title 21 changes— we're getting some changes there. It's awesome. And MOA coordination— when I have an issue, I I can call the MOA and say, hey, I've got this issue, and they help me out. Like, that's just revolutionary. That was never there before.

Like, they didn't care. I could call nobody. I could say, I got this huge issue, I need to call somebody. I was like, who am I going to call? You know, it's like, I got nobody right now.

I can actually call somebody. Like, this— these are really awesome, great things. All right, so I decided to do a little thing here, and this is Raspberry Townhomes. It's a development we're doing in South Anchorage. It's It's a $20 million project, 58 townhomes.

And I wanted to show you the site plan. So this isn't nearly as sexy as this, which is the, you know, the nice-looking picture. But we'll play with this for a second here. So this site plan shows you, number one, where the units are, which are these white kind of boxes. Those are the actual townhomes, OK?

And then everything that's not white is something else. So that could be landscaping, that could be private open space, that could be snow storage, parking, drive aisles, and fire lanes. Okay, so I tried to maximize this site as much as I could. I tried to put every single unit I could possibly put on this site. It's 2.25 acres, and I got to 58 units.

So that represents 30% lot coverage ratio. 30%. Now, that's interesting because R-3, which is the zone that I'm in, allows 40%, right? So I missed out by 30%. I could have increased the number of units if I had actually been able to get to 40% just simply because of existing Title 21 setbacks and other types of regulations that they have.

So my contention is, is it's not only that we need more land, it's that we need to more efficiently use the land that we currently have, right? If I can increase the number of units that I have by 33% on every development that I do, that is a substantial amount of units that we can put just by simply changing policy that we have within the municipality of Anchorage, right? That's a policy change, and we can do that and increase our availabilities of doing units. All right, so what does that mean? That means that number one, we need a comprehensive setback analysis of our Title 21 code that's 1,000 pages.

I'm sorry, but somebody's got to sit down and someone's going to do it, and it's not going to be me. All right, we have to go through that. Number 2, the fire code has got to be changed. Okay, this is Raspberry Townhomes. All right, a normal driveway is 25 feet.

Okay, here we have 44 feet of asphalt, and that's because of the fire code on our south side. And on our north side, we have a 38-foot drive aisle All asphalt, all extremely ugly because of our fire code. Now I ask the question, why is a fire truck dictating housing policy in Anchorage, Alaska? So that fire lane access represents 7,520 square feet, which is 15 units, just because of our fire code policy. How come other municipalities are not also being hit by that?

We have to look at that. That's a huge issue.

I love this one. All right, I'm not picking on Chugach, all right? Just, is there any Chugach people there? I promise I'm not picking on you. I'm just saying this is something that we need to look at, all right?

That's two different things. All right, so Chugach has a tariff issue that they have to comply with. All right, so that's not their fault, but they have to comply with it. And basically what it says is that for every door that you have that's residential, you have to have one electric meter.

Not a big issue, except if you want to hook up things like solar power or combined heat and power micro turbines. Or geothermal or any of these other alternative energies that you want to hook up to your building, you need one, one electric panel. All right? I can't hook up a microturbine to two. I only can hook it up to one.

And so when you have a regulation that says you have to hook it up to every single unit, that means that I have— I have no other alternative than to hook it up to Chugiak. Chugach Electric, right? Which is great for them, but not so great for maybe me. And again, I'm not picking on them. I'm just— that's the tariff that they have to comply with, and it's not their fault.

Permitting. Sorry, Bob. Took me 9 months to go through and get a permit. 9 Months! Like, this is crazy.

Like, in Anchorage, we have a very short little window for construction. And when it extends an extra even 3 months and it takes you past the ability to get in the ground and put a foundation in, then we've got serious issues when a permit is taking so much long. And it's easily resolvable. It's not like this is a hard thing. Sorry, Bob, again.

So, you know, what's the solution? We need to outsource it, right? This is not a hard thing. If we outsource a review, If we outsource our inspections, we have very talented people here in Anchorage that are more than capable of doing this and doing it well and quickly and under the time constraints that we currently have. This is very, very, very solvable.

Business morale. Okay. You need 3 things. You need 3 things if you want housing to prosper. 3 Things.

You have to have these things. Otherwise, they will not prosper. It doesn't matter how much, how cheap you think it might is. If you don't have these things, it doesn't matter because housing is not going to be built there. Number 1, you have to feel safe.

If you do not feel safe, you will not spend your money to build something in that area. You have to feel safe. Number 2, your property rights have to be valued. If they're being vandalized and terrible things are happening to your property, then, then you're not going to simply spend $20 million to put something there because the property rights aren't being recognized, right? And then number 3, the infrastructure around it has to be good.

If we don't update our infrastructure and we, and we have these terrible, you know, sidewalks that we're walking on that were 3 inches from a car going 50 miles an hour— like, if we have this terrible infrastructure then we also aren't going to want to super invest in that area, right? And so those are 3 things that have nothing to do with Title 21. Maybe in some ways they do, but they have to be present in order for us to do that. All right, am I up on my time? Will you give me the— All right, that's all.

Thank you.

Thank you very much, Sean. So now we are at the Q&A portion of the event. We've got a little bit of time for that. There's one mic, I think, for the audience. Is that how we're doing that?

Or—. And then one for the— one for the folks behind me. Actually, if you just repeat the question from the audience and then hand them a mic. Sure, we can play telephone. Perfect.

I'm going to give somebody—. But the one that connects to the audio for the Zoom people is the So I'm going to apparently take questions from you all and then turn around and give it to you. This is going to be— this is going to be a fun little logistical. So if you want to— if you're in the audience, go ahead and raise your hand. If you are online, we do have the capacity to take questions from the online crowd, I think.

Is that—. Yep. Somebody's going to be monitoring that. They'll give me a high five.

Oh, I know too many people in this room to think that none of you have questions. Don't try to pull that on me. Nobody has any questions about housing? There we go. Thank you.

Um, so I think David stated that our population has been, uh, growing over the last 10 years, um, and kind of touched on that they, uh, you didn't feel like it was a population increase that's creating our housing shortage, that it's a development, uh, situation that's not. Do we have any data on how many houses have left the market? Or like, you know, decommissioned or that needs that new growth to happen. Do we have any from any of those? All right.

So I'm going to repeat this for the folks online so they can hear it. The question was for David, and it was asked if the population hasn't been increasing, if the lack of housing isn't driven by an increase in population, is it being driven by houses falling off the market? And if so, do we know how many? Have fallen off. So, David, do you want to field that one?

Hi, everyone. Daniel Dolfino, but my sister married to David, so I'm used to being called David as well. It's all right. Happens all the time in my family. So population.

It has gone up, but it also came back down. So many, many years ago, it was 738,000. It grew up into the 740s across the state and then back down. I just put that out there because it's a statewide figure. We do have communities that are growing.

So in some communities, there is population-driven housing. Um, the reason why I wanted to put that out there is that I think most people assume that it's always population growth, and I'm just trying to provide context that there are a bunch of things beyond what we typically track that could be affecting this. It could be housing composition. It could be units coming offline because they're being demolished. You go to the villages, you see a lot of places that are probably counted in housing stock that no one's living in, especially up in Fairbanks.

The precise counts on that— I know the census tries to do a good job every 10 years, but that's the best data source that I'm aware of. I know a bunch of people have tried estimating it. I haven't found a robust enough data source that I feel comfortable with. That could just be my ignorance, but I'm not aware of one. But I appreciate the question.

Excellent. Why don't you hold on to that? We're going to pass it around for whoever has the next question. Yes, right here.

Modular homes. I was wondering if somebody could expand on that a little bit. All right, for the folks online, there was a mention of a Northrim program for modular homes. Does anybody want to weigh in on that? Yeah, if I said that, I misspoke.

What I was referring to, and I think actually Sean, maybe you've used the product, but Northrim has a construction loan product that converts to a PERM loan. And my point of sort of bringing that up is there's been a lot of talk on are there state agencies that want to fund some sort of interim financing? Is there, you know, what are the— are there possibilities for mezzanine financing, in other words, sort of gap financing that can be resolved not just at a private level but maybe through state cooperation? And then ultimately also at the smaller level, it's very hard if someone wants to go and, you know, add a unit onto a house or do something. It's like someone says, "Okay, I got 2 extra lots next to me.

I want to build, you know, 2 extra duplexes, sort of just understanding where that all starts, given how high the cost of capital is right now, being able to figure out how to manage that, both that construction piece to the PERM loan. But my point was saying, we have a local bank that's trying to create a product that's making the transition from that construction financing to PERM loan easier. Thank you very much. Jennifer? Yes, um, um, I know way too much about how Python and Windows is created.

And, uh, but, and I know other cities have done this, they have actually used AI to just look at redundancy and conflicts in code to —And I remember us suggested to the administration, is anybody doing that at this point? Can we use AI to look over Title 21 and suggest changes and efficiencies? Is that— looking for conflicts and redundancy. Who wants to handle that? There we go.

I think even AI could find itself challenged by Title 21. That aside, more We're at a point right now where we're in the midst of a 10-year targeted review of our comprehensive plan, which Title 21 involves— exists to implement. So ask us after that's completed because, you know, kind of the comp plan is the foundation. You need to get that built before you clean up what's on top of it.

Where are other cities that have been doing those in combination with comprehensive plans? And comprehensive plan is a vision plan, and then Title 21 is the implementation. But anyway, it's just—. So I was asked the schedule of that. Right now we're in the midst of that targeted review.

The staff has done their portion, and we're bringing out an outside reviewer or somebody who doesn't have any skin in the game of how it was written or developed to compare it with other more adaptable, more recent comp plans. We envision that to be done probably January, February, that we'll at least have that kind of better-defined baseline that we feel like we need before we— and then to adjust from there. And can I ask one more question? Sure. The municipality Does the municipality have TIFs for infrastructure, curbing, and other programs?

Tax Increment Financing. No, it does not.

All right. I would just say to that, you know, I think a lot of us that have been around this conversation for, you know, over a decade now. There was a time when tax increment financing is utilized elsewhere, but there's really some question as to whether it's even allowed through our— in the state of Alaska. But I can remember spending hours and hours and weeks talking about this issue. And what I would just say is, we go all the way up to the AG's office, we talk about— I mean, all of you are— I see a lot of heads nodding.

The point is, is the municipality figured out a tool that they could employ deploy themselves. So that by looking at tax abatement, it's not TIF, it's different, right? But it's a bit of a proxy to that. And they said, okay, the existing tool on the books was not a long enough period, it was hard to get, it was geographically constrained, we're going to open that up. So I think that's at least Anchorage's response to a tool that I think has proven perplexing and will continue to.

I will not volunteer for the TIF work— working group in the future. Let other people work on that one. But your question is a good one.

Our tax abate—. The tax abatement tool is for the project. It is simply for the benefit. It is not an ex— there's a couple of factors that if you do a few other things, you get to lengthen it. But it's not as, hey, we're only giving this to you because you're you're gonna fix this road.

In fact, that's— that to me, that's the big— that's the big change, which is finally understanding that there was a very real feasibility challenge of these developments. And but for this tool, it wasn't going anywhere. I think we got time for one or two more. Uh, Ross, and then—.

I guess with current projections 3 to 5 years out, how do we look as far as housing? I hear there's a lot of military investment coming in. And are we going to be— are we going to have enough housing for the next 3 to 5 years? With current projections— what are the current projections for housing needs in 3 to 5 years, especially with the military funding and personnel coming in? Are we going to have enough homes?

Sure. So this is Daniel for the people online. I'm not going to do projections, but I'll say that 3 to 5 years from now, a couple things could happen. The short-term rentals— we have 1,500 to 5,000 units that are short-term rentals at any given time during the year. What happens if they stop being short-term rentals?

What happens if more become short-term rentals? What happens if that interest rate drops from 6% down to 4% again? What if it goes up to 8%? We know that the markets are already tight. In Anchorage, the vacancy rate for rentals— not income-restricted rentals, just private sector rentals— is under 5%.

In Juneau, it's under 5%. In a lot of communities that most of the state lives in, it's under 5%. The average mortgage price— or mortgage— is over $400,000 across the state. So we're already in a place, even though I said it doesn't appear to be population-driven, statewide basis, it's already expensive and the lines continue going up. So if more people start getting added into there, it just— it's a basic math issue where I don't think I'm going out on a limb to say more people need places to live.

And right now, the stock doesn't seem to be providing enough choice for people to have downward pressure on prices or even stability. It's going up.

Thank you very much. So Ross tells me that we had time for 2 more. I said you would get one, and then Natasha, I think you've had your hand up, so go ahead. I have 2 things to say. One, I did come from the AGC Industry Day where the JBRUSA is talking about the funding they're going to be getting for $6.7 billion to do work on base, $2.1 billion for next year.

They're going to need workforce. The companies that can handle that are all coming from out of state. The workforce is going to come from out of state. They're going to come. That's one thing.

And then on a personal note, we invested a lot in infill properties in downtown Anchorage and Fairview. And I just want to reiterate what Sean said, which is it isn't just— I mean, tax payment is The requirements of Title 21 are ridiculous, but particularly downtown in Fairview, it is safety, it's security, it's crime, it is awful. And the municipality needs to do that. Our property values are down significantly. We have sold some properties, but, but what we bought it for and what it's valued at now is significantly— it doesn't make sense to invest down there.

And it really sucks because downtown was so beautiful, it was growing, it was moving eastward, and now it's not. It's stuck and people are moving out. And I just want to reiterate that the municipality has a lot of work to do, and not just with Title 42, but with security and crime. All right, I'm going to do my best for the people online, but that was a lot and And it's late in the day, so the first part was about the $7 to $8 billion coming in for JBear for infrastructure development and the workforce that that's going to require, the housing needs that that's going to drive. The second piece was a sort of call to action by the municipality to help address property value declines, public safety issues, and other factors that are causing people to either lose value in their properties or not create new properties.

I know that's not quite the full thing. Is that close enough? All right, fantastic. All right, Natasha, last one. Okay, thank you.

Um, one of the questions that Sean kind of briefly alluded to is the choice between an apartment house versus a hotel. And I think we have 4 hotels being built right now. We're seeing a lot more hotels than we are really seeing apartment houses. And you alluded to it saying, well, the hotel needs a permit and I need all these other things. So So first of all, I'm hoping to see if I can find out what are those other things, because I'm curious.

And is that something that Mr. Bob Dole can kind of take a look at? Or do you think it's because we haven't reached saturation yet with tourists and we still have all of these short-term Airbnb rentals that a hotel can do $300 a night for 4 months for one room and it's $36,000 a year versus an apartment $2,000 a month, it's $24,000 a year. I mean, is it money, i.e., cost, or is it the permits, or is it all of it? So the question goes back to Sean's slide about the difference in permitting between hotels and high-density housing. What's driving that?

Is it strictly the permitting issues, or is it a matter of the amount of money that you can raise from a hotel versus a rental unit? Was that—.

I think what— sorry, I think what Tyler was actually trying to say, because he had that little slide up there, and what his point was is that a hotel has no design standards requirement, right? But if I want to do multifamily, I have to increase my cost by 15% in order to achieve those design standards. And so why do we have design standards for multifamily, and we really desperately need multifamily, but no design standards for hotels, right? Like that's the dichotomy that we have here. As far as the saturation point, like, you know, there's smarter people here than I am, but the bottom line is that Anchorage has a lot of— not only do we have a lot of tourism that come here, we have a lot of seasonal workers that come here during the summertime, right?

And I constantly, constantly, every single day, I turn away probably 4 to 5 people every single day that are looking for someplace to stay for between the months of like March to September. So they don't want a full-year lease, and we only do full-year leasing, right? And so they have to go somewhere. These 7,000— I think it's 7,000 people move to Anchorage in the summertime. They have to go somewhere.

And so sometimes short-term housing like, like VRBOs is their solution. It's that they have to go someplace, right? Like, we have to account for all types of housing here in Anchorage, not just the 12-monthers, but also the 7-monthers or the 8-monthers, right? So we have to accommodate for all of those. And then, I don't know, did I answer all your questions?

I don't know if I did or not, but— Fantastic.

Well, thank you so much. Can everybody give our 6 presenters a round of applause here? This was fantastic.

We heard a lot this afternoon. There was a lot of information that was covered for those of you that maybe didn't feel like you took notes fast enough, we will be posting the entirety of this on our YouTube channel later on this week. I also want to just give one more round of thanks to the Cook Inlet Housing Authority and for the Alaska Housing Finance Corporation, one for funding this and one for housing the space today or providing the space today. Can we give them a round of applause? Awesome.

Thank you so much. If today's conversation was useful to you, if you enjoyed this and you think that this is a valuable feature to have in our state, in our communities, there's a couple things we'd like you to do. One is, of course, join Commonwealth North. The organization is really driven by memberships and participation. Ross is over there, he's gonna be standing by the door to talk to you on the way out.

It can't be avoided, so don't even bother trying, but he's got a very soft pitch and it's a wonderful organization. Second, We really hope you come back on September 17th. The more people that we get in the room for these conversations, the better the Q&A is, the more we all are sort of educated and have a delightful baseline for these issues that are so crucial to our cities and our states. Your participation makes all of this better, as well as the participation of the panelists. So last but not least, thank you all for coming here tonight.

Drive safe, and we hope to see you again at our future events.

Nice to meet you. Very nice. Hey, ladies. Hey.