Towns in transition: Mat-Su on the move.

• Author: Tyson, Ray
• Position: Matanuska-Susitna Borough, Alaska

First a farming colony, then an Anchorage bedroom community, the Matanuska-Susitna Borough hopes to shore up its economy by luring industry.

The Matanuska-Susitna Borough continues to post big growth numbers, having fashioned an economic and community profile unlike any other in Alaska.

But trouble looms on the horizon, especially for the property owner who already shoulders most of the Valley's increasing tax burden.

"Property taxes just aren't going to cut it -- we need to diversify," warns John Duffy, the borough's planning director.

Borough watchers have been echoing the same concern for years, dating back to the early 1980s oil boom when the Valley experienced unprecedented growth as an Anchorage bedroom community. When the state economy fell on hard times a few years later, the region took an equally steep nose dive, losing population and more than 1,000 jobs.

Once again, a shaky petroleum industry has oil-dependent Alaska and the Mat-Su facing a tenuous future. But circumstances are much different today than they were during the economic heyday of 10 years ago.

For one, crude oil production is now on an irreversible decline, which has reduced dramatically the amount of money available to the Mat-Su under state revenue-sharing programs. With its savings account depleted, the borough has turned more and more to the taxpayer to shoulder the burden.

Moreover, people continue to flock to the Valley, attracted by its affordable housing and a rural lifestyle, requiring more government services and putting additional pressure on an already overburdened system, especially on public schools. In fact, more people reside in the Valley today than did during the oil boom.

"The Valley has a phenomenal growth rate ... one that has grown much faster than the state average," observes Neal Fried, a state labor economist. "It's been pretty much the growth leader for decades."

From 1980 to 1990, for example, Mat-Su's population grew 122.7 percent compared to the state average of 36.9 percent. That growth rate continued into the 1990s, with most of today's estimated 50,000 population centered in the Wasilla/Palmer area.

On the average, the population is a little older and the typical family household has a little less income compared to the rest of the state. Fewer minorities reside in the Valley. Rent is less. And the average cost of a single-family home is lower, about $106,289 compared to $145,231 in Anchorage.

The Mat-Su also is a popular recreational...