$24M Investment Fosters Community Collaboration
True to its mission to provide Alaskans access to safe, quality, affordable housing, Alaska Housing Finance Corporation continues to innovate new ways to support Alaska communities. As trends and the economy have ebbed and flowed throughout the past 50 plus years, one thing has remained constant: access to housing is an especially challenging circumstance in Alaska’s small communities and remote rural villages, many of which are off the road system.
The problem is especially prevalent for temporary or short-term healthcare providers, educators, law enforcement and court employees as well as other public service professionals, many of whom sleep on office or school floors during work assignments. The circumstances are unsustainable and a lack of housing means jobs are unfilled because prospective employees are unable to secure places to live. The detrimental impact of these circumstances ripple across communities with long-term repercussions.
Innovation Drives Sustainable Communities
People have always been the driving force behind Alaska Housing’s programs – both the people behind the ideas and people served. For decades, foresight has allowed AHFC to not only address the immediate housing needs of individuals and communities across the state but develop unique and buildable programs with the capacity to expand. Alaska Housing’s long-term approach to problem solving offers a significant statewide advantage steeped in a historical understanding of Alaska’s 350 distinct communities and their market needs.
Alaska Housing’s Last Frontier Housing Initiative is one such product. An expansion of AHFC’s successful Rural Professional Housing program, the Last Frontier Housing Initiative is designed to jumpstart housing development in five hub communities by working directly with local governments. Providing an opportunity to fill gaps associated with critical state positions, it is comprised of four parts:
- Fall 2023 State of Alaska Public Safety and Commissioner-level surveys that identified the communities in greatest need of hard-to-fill critical positions with direct impact on the agencies
- Analysis of past AHFC allocations and gaps in housing coverage
- Assessment of AHFC’s grant and staff resources
- Charting capacity and building units
Investing In Collaborative Solutions
AHFC’s Last Frontier Housing Initiative takes a unique approach encouraging community involvement and innovative thinking. A combination of federal and state funds allows Alaska Housing to embark on a once-in-a-generation opportunity to incentivize funds to local governments in Western and Southeast Alaska for new housing. The communities of Nome, Kotzebue, and Bethel in Western Alaska, as well as Ketchikan and Sitka in Southeast Alaska, have been identified as communities most in need and most likely to benefit. All five communities will receive funds to develop affordable rental housing for households at or below 50% of the area median income. Bethel, Kotzebue and Nome also received funding to develop rental housing for state workers.
Front Street, Kotzebue, AK
Western Alaska – $15 Million
Waterfront view of Sitka, Alaska
Southeast Alaska – $9 million
- AHFC allocation of up to $4.5 million per community in expiring grants from Emergency Rental Assistance funding for the communities of Ketchikan and Sitka.
- Access to the full funding per community requires local governments to secure a minimum 15% match to project costs which might include land, waiver of permits or fees, cash, and more.
- Communities are required to deliver a minimum of eight new housing units for households meeting the low income definition determined by U.S. Treasury.
- Communities are encouraged to leverage AHFC’s contribution with local, philanthropic or other funds to the greatest maximum extent.
- New construction must meet AHFC’s minimum criteria for financing, including energy efficiency standards of 5-star-plus or greater.
Building Community
Throughout 2023 and 2024, more than 30 meetings have been held with Commissioners and community partners. Alaska Housing staff has traveled on-site to each of the five communities to meet with local leaders.
Proactive thinking has sparked truly innovative solutions that best meet the individual needs of each location. Funding agreements have been executed between AHFC and all five communities and, as of late 2024, construction is underway in Bethel, Saxman and Sitka. AHFC is providing flexible level of support for each community to match their individual needs through the process.
As of this date:
- The City and Borough of Ketchikan and the City of Saxman are working in tandem and drawing on the strengths of each entity. With a larger available staff, the Borough is providing bookkeeping and administrative assistance. The City of Saxman is providing suitable land to be developed. An RFP was quickly issued and a contractor selected. They have also selected a developer who has committed to building 14 units – nearly double the minimum requirement. Buildings are under construction with project completion as soon as August 2025. The City of Saxman will own and manage the units once built.
- The City of Kotzebue is working closely with Alaska Housing. The city issued RFPs mid-2024 using AHFC’s online system to which they received proposals from multiple interested entities. The City ultimately selected Kikiktagruk Inupiat Corporation (KIC) as the developer for both the required six units of professional housing and an additional three units of affordable housing. They anticipate construction on the combined nine units will begin in 2025.
- The City and Borough of Sitka are working cooperatively toward the development of 10 units of affordable housing. The communities coordinated on rating criteria development for the project and selected Baranof Island Housing Authority as the developer. Construction on the units is underway with estimated completion in 2025.
- The community of Nome has worked cooperatively across community entities launching the project with a meeting in early 2024 with the local elected officials. After putting out RFPs, Nome selected Bering Straits Regional Housing Authority to develop nine new rental units. The construction is set to begin in 2025.
- Bethel has taken a slightly different route, awarding the federal money to a developer and property owner who will own and operate a new building with three housing units that are affordable. Construction on these units is currently underway. A separate builder will be hired for the required six professional housing units with the city offering two lots of land. The City of Bethel will own and manage the professional housing units. Construction is set to begin in 2025.
“When we started down this path, we knew that communities are being challenged with housing in ways they have not in recent memory,” says Bryan Butcher, CEO/executive director of Alaska Housing Finance Corporation.
“We didn’t know what their capacity would be in accepting our funding proposal but now, just a year in, the community energy is inspiring. It is exciting to see local leaders coming together to collaborate and identify unique ways to address area housing needs,”
“Our Last Frontier Housing Initiative has the capacity to change community landscapes and make a difference not just in the lives of high-need professionals but impact the overall wellbeing of these communities and ultimately our state” added Butcher.
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