Alaska to benefit from upcoming construction season: more than $6.5 billion to be spent in 2006 statewide.

• Author: Orr, Vanessa
• Position: BUILDING ALASKA

As the weather gets warmer and the ground begins to thaw, the rumbling of heavy equipment signals the start of spring on the Last Frontier. As Alaska gears up for another construction season, employment and project spending are expected to increase, as are the number of new facilities around the state.

According to Dick Cattanach, executive director of Alaska General Contractors, in calendar year 2006, more than $6.5 billion will be spent on construction, which is up 13 percent from the previous year. Employment in the construction industry is expected to grow by approximately 4 percent, as it has in previous years.

"Part of the increase in construction spending is due to high energy prices-construction in the oil and gas industries is expected to increase by 20 percent in 2006 to more than $2 billion," Cattanach explained. "Utility spending will also be up, in part due to the new power plant that's being built in Fairbanks that is projected to happen this year."

According to the Alaska Construction Spending Forecast, published by the AGC and the Construction Industry Progress Fund (CIPF), this increase in oil and gas industry construction is mainly due to an increase in exploration and development activity on the North Slope and in Cook Inlet, as well as investments in refinery and pipeline upgrades. BP, ConocoPhillips and ExxonMobil are expected to invest $1.5 billion in their Alaska operations, much of which will be spent optimizing production from existing fields.

School construction also is expected to increase, with projects that were funded between 2003 and 2006 taking shape. "There will be quite a bit of school construction this year as money begins to hit the streets that was passed by the Legislature last year," said Cattanach. "Total university spending between Anchorage, Fairbanks and Juneau is estimated to be between 90 million and $100 million, and more than $200 million is expected to be spent on kindergarten through 12th grade construction statewide."

Roughly $300 million is budgeted for airport construction and improvements this year, including the A and B concourses at the Ted Stevens Anchorage International Airport, and major renovations at Fairbanks International Airport. The Port of Anchorage is also looking to spend approximately $40 million this year as part of a $300 million expansion project.

According to Cattanach, road construction will increase this year, up about $100 million from the $300 million appropriated last year. Many projects have yet to be determined, however, until a final decision is made on whether the current road program will contain both the Knik Arm bridge and the Ketchikan-Gravina bridge. "Though there will be an increase in the road budget, how it is used will depend on whether the state will be doing the same roads program in the past and one bridge project or two bridge projects," said Cattanach. "If we do two bridge projects in the amount the governor proposes, the state will end up cutting back on the current roads program."

One of the biggest players in this year's construction season is the U.S. Army Corps of Engineers, Alaska District, who is expecting to spend roughly $800 million in both fiscal years 2006 and 2007. This money will be spent on projects including military construction, civil works projects, environmental projects, operations and maintenance of existing projects and administrative services. In its biggest program ever, the district awarded $792.7 million in contracts...