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Stuart Denslow Tongass Testimony Page 3 



products. Payroll losses would total $37 nillion, or 29 percent of all income 



earned in the Sitka economy. Sitka's average monthly wage would drop from 



$2,033 to $1,885 per month if the highest paying sector, forest products, were 

 removed . 



Declines in gross business sales are assumed to be in direct proportion to 

 losses in total income — a 29 percent loss. An estimated $37 million loss in 

 business sales would result, with $19 million of it in retail trade. Further 

 sales decline could result because industries which maintain a stable economy 

 such as construction would be virtually eliminated. 



Municipal utility and property tax revenues would be affected through the 

 direct loss of APC payments, such as the $1.4 million in electricity, $100,000 

 in water, and $326,000 in property tax paid by APC, as well as through 

 population loss and related decline in the commercial sector. Direct funding 

 from the State of Alaska through Municipal Assistance and Revenue Sharing would 

 be reduced in proportion to the population loss. The mill pays 17 percent of 

 property taxes in Sitka, and APC-employed households pay an additional 18 

 percent. 



The largest economic losses are likely to be in the decreased value of all 

 forms of real estate. If Sitka were to lose 24 percent of its employment and 

 29 percent of its payroll (a moderate estimate), a 40 percent loss in the value 

 of all residential real estate could be anticipated. If the average Sitka 

 single family homeowner owns a $120,000 home, it would be worth $72,000 

 following APC closure, a loss of $48,000 per family. For the economy as a 



