366 



medical services will be one-fourth smaller. The net result is the municipality 

 losing significant revenue from fewer patients and in turn having to raise 

 rates to partial make up the difference. These rates must be paid buy the 

 remaining population which will have much less personal income to pay for 

 them. Further, significant reductior« in medical staff decreases the quality 

 «md quantity of health care available in Sitka. Private practitioners will also be 

 forced to dose shop. The end result of an APC closure will be less health care 

 for the average Sitka family and less ability to pay for what health care 

 remains. 



Finally, local government administration will lose significant state funding 

 (see main impact table) and layoffs will occur in schools, the hospital and 

 municipal administration. Everyday services such as street maintenance, fire 

 and police protection, upkeep of utility systems and administration will be 

 reduced. Insurance rates may increase as a result of lower levels of fire and 

 police protection. 



Social Service Impacts 



Severe economic recessions are a double-edged sword where social services 

 are concerned. Personal trauma increases the demand for social services but a 

 smaller population and less money mean less social services to meet demand. 

 Such social problenns as domestic violence, alcohol and drug abuse, divorces, 

 personcil bcmkruptcies, trauma from job loss and financial stress are all 

 exacerbated by economic catastrophe. Social services are needed to help 

 individuzds and families cope with the loss of homes, jobs and financial 

 security. 



Household Impacts 



The average household in Sitka (70% of which own their own homes) will 

 have negative equity in their investment in their home. They will lose an 

 estimate $48,000 in value of their major source of their financial security, 

 their home. They will be unable to sell the home for what they owe on it, 

 making it impossible to leave the community without taking a significant 

 cash loss or just abandoning their home and destroying their credit rating. 

 Anchorage, Juneau, the Matanuska-Susitna area and Fairbanks have had 

 thousands of homes abandoned in their recessions which were moderate 

 compared to the scale of Sitka's with an APC withdrawal. Many households 

 had no other choice than to remain unemployed and drain their reserves, 

 desperately trying to hang onto a house which they owned, which was worth 

 less than they owe on it for which there was no one to sell it to at any price. 

 Home ownership will become an economic yoke for two out of three Sitka 

 families. 



Another effect on households in a serious recession is the ceasing, or at least 

 slowing, of discretionary spending. Households become fearful and stop 

 buying a number of goods and services, especially those which cost much 



