From dust to dawn: Southeast awakens to a new era of prosperity after sawmill closures left it in the dark.

• Author: Swagel, Will
• Position: Alaska

Melissa Thorsen-Broschat is a long way from the portable espresso cart that once constituted the whole of her business, Highliner Coffee Co. Now the owner of a spiffy cyber-cafe in downtown Sitka, Thorsen-Broschat wants to make her Highliner Coffee beans the third regional roast for Southeast Alaska, after Juneau's Heritage and Ketchikan's Raven's Brew. To do that, among other things, she'll need to buy a $45,000 roaster.

These days, Thorsen-Broschat is fielding questions from the Sitka Economic Development Commission, a nine-member citizen group that constitutes the first review for businesses seeking to tap into Sitka's $18 million in Economic Recovery Funds, the so-called "Stevens Money." Thorsen-Broschat is seeking a $72,000 low-interest loan from a $7 million revolving loan program the city has set up to help new or expanding businesses. The commissioners tell Thorsen-Broschat they especially support the manufacturing and export potential of her business.

In the fall of 1996, the timber-dependent economies of Southeast Alaska - which had seen timber harvests severely curtailed and three major timber processing facilities close over the previous three years - received a windfall, primarily engineered by Sen. Ted Stevens of Alaska. More than $75 million in federal economic disaster funds were appropriated for Southeastern - and after some haggling, the communities were given full control of the money.

Two years later, the fruits of that money are evident. In Sitka, Wrangell and Ketchikan - the three primary beneficiaries of the Stevens funds - new infrastructure and new businesses can trace their origin back, at least partially, to the flood of money. Displaced timber industry workers were offered job counseling and retraining, and a shot at construction jobs on the public works projects. Wrangell even took the sales tax off food to ease the drain from former millworkers' pockets.

Although the three towns received their money at the same time, each was at a different point in downsizing its timber industry.

Sitka's Alaska Pulp Corp. mill closed in 1993 - three years before the Stevens money came. APC workers' severance pay had run out and local businesses were already feeling the pinch, but the initial panic was over.

Wrangell's big sawmill had shut down Christmas of 1994, more than a year before the money came. The town, still in shock, calmed with news of the coming funds.

Ketchikan received word of its share of the funds virtually at...