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Stuart Denslow Tongass Testimony Page 6 



Support sector impacts would be far reaching. The construction industry 

 would be devastated, with loss of much of this industry's $4 million payroll. 

 Other industries, such' as transportation services, utilities, trade and seafood 

 industries, finance, insurance and real estate would all be reduced, with fewer 

 jobs, services and goods available. Service industries are expected to decline 

 in relation to the 29 percent loss of income in the community. 



Other communities have experienced devastating economic recessions during 

 the 1986-88 period. Juneau's recession drove real estate values down by one- 

 third and was the result of a loss of less than 10 percent of the economy. In 

 Anchorage, where the real estate market collapsed, banking system destabilized, 

 thousands of homes were left empty, businesses closed, and business and 

 personal bankruptcies continue, the economic loss was less than 15 percent of 

 the total employment. The I970's recession in Seattle triggered by Boeing, 

 when signs appeared saying "Will the last one out turn off the lights?" was a 

 loss of just 5 percent. Sitka's potential loss of one-fourth of its economic 

 base is far more severe than any of these, with the analysis of impacts 

 resulting from the closure of APC erring, if at all, by being too 

 conservative. 



An economic dislocation of the scale of Sitka's projected loss would cost 

 home owners an average of $50,000 in home value with no market to sell to. Job 

 losses, financial ruin, personal trauma and increased social problems are 

 inevitable. Leaps of 50 percent in utility rates and property taxes; cutbacks 

 in municipal services such as police, fire, health care, and education; higher 

 prices for goods and services; and less selection are certain to occur. The 



