Department of Commerce, Community, & Economic Development - Alaska Industrial Development & Export Authority
Promote, develop, and advance economic growth and diversification in Alaska by providing various means of financing and investment.
- Finance and/or develop commercial, industrial and infrastructure projects to create jobs, grow the economy, and promote resource development in Alaska. Provide predictability to commercial borrowers to allow job growth and continually expanding economy.
- Manage AIDEA's project development and loan portfolio for best growth of net asset balance while maintaining positive returns to meet operational requirements.
- Provide long-term financing, and/or refinancing, to Alaskan businesses for new or existing projects, and provide conduit financing for taxable or tax-exempt bonds for Alaskan organizations.
|Mission Results||Core Services|
|A: Result - Promote economic growth in Alaska.|
|A1: Core Service - Finance and/or develop commercial, industrial and infrastructure projects to create jobs, grow the economy, and promote resource development in Alaska. Provide predictability to commercial borrowers to allow job growth and continually expanding economy.|
Target #2: Create, or retain, 400 construction jobs annually through the Project Development and Commercial Finance programs.
Analysis of results and challenges: AIDEA uses job creation as one of the measures of its success, and considers it important to distinguish permanent jobs from construction jobs. Construction jobs may be short-term by nature, but they are an important factor in the measurement of expanding economic activity. AIDEA includes both pre-construction and construction jobs into this category. Pre-construction jobs include activities such as design, engineering, and permitting. During FY2020, AIDEA loan and development financings supported the creation of 496 construction jobs. This is an increase over the previous year and exceeds AIDEA's target of creating or retaining 400 construction jobs.
|A2: Core Service - Manage AIDEA's project development and loan portfolio for best growth of net asset balance while maintaining positive returns to meet operational requirements.|
Target #1: Manage AIDEA's Development Project portfolio for best growth of net asset balance.
Analysis of results and challenges: AIDEA actively supports economic diversity, job creation, and responsible resource development through our loan, project finance, and infrastructure development programs. AIDEA pursues the responsible development of intermodal transportation systems, including roads, rail, and ports, to help reduce the cost of access and export of Alaska's natural resources. Additionally, AIDEA has been working to develop infrastructure to reduce the cost of energy throughout Alaska. As the state's development finance authority, AIDEA has been co-investing with the private sector through the use of Public-Private Partnerships to build the infrastructure needed to develop Alaska's natural resources.
Target #2: Maintain sufficient liquidity to meet bond covenants, fund project investments and fund new loans. Build and maintain liquidity to support Alaska projects, pay an annual dividend to the State general fund, and allow AIDEA to meet operating expenses.
Analysis of results and challenges: AIDEA's Revolving Fund Cash and Investments compared to General Obligation Debt communicates to the market that AIDEA has the financial management and internal controls to sufficiently meet its debt service obligations. This operationally driven liquidity enables AIDEA to meet its financing goals and access cost-effective external capital. A high cash ratio increases AIDEA's overall capacity for project investment and new loan funding. In FY2020, AIDEA defeased all of its outstanding general obligation bonds, resulting in a ratio of 0.
|A3: Core Service - Provide long-term financing, and/or refinancing, to Alaskan businesses for new or existing projects, and provide conduit financing for taxable or tax-exempt bonds for Alaskan organizations.|
Target #1: Issue $35 million in new loans each year.
Analysis of results and challenges: The current low interest rate environment and clients' needs to stabilize their debt service requirements over time has resulted in significant usage of the AIDEA Loan Participation program over the past six years. Despite continually decreasing oil prices starting in FY2015, this program has aided in expanding economic activity statewide, resulting in job and wage growth as well as steadily increasing AIDEA Revolving Fund values. Usage of the AIDEA Loan Participation program by the State's commercial lenders remained relatively flat in FY2020. This fiscal year included one quarter of economic disruption associated with the COVID-19 pandemic, however, the total amount of new loan participations funded still increased from the prior year by nearly $5 million.
Target #2: Maintain Revolving Fund loan portfolio delinquency rate lower than 3% of the outstanding balance.
Analysis of results and challenges: AIDEA consistently manages the challenge of making good financing decisions while providing financing to support economic growth in Alaska. Loan delinquency rates in FY2020 on the Loan Participation program remained well below the threshold of three percent as in previous years. However, the full impact of the economic disruptions related to COVID-19 were not fully realized in this fiscal year.
Current as of December 3, 2020